ILLINOIS POLLUTION CONTROL BOARD

March 20, 2003

HERR PETROLEUM CORPORATION, an

Illinois corporation,

Petitioner,

OFFICE OF THE STATE FIRE MARSHAL,

Respondent.

)

PCB 03-86

(UST Fund)

ORDER OF THE BOARD (by L.P. Padovan):

Herr Petroleum Corporation (Herr Petroleum) petitioned the Board to review a

determination of the Office of the State Fire Marshal (OSFM) concerning Herr Petroleum’s

gasoline station, which is located at 319 E. Main Street, Route 150, in Knoxville, Knox County.

The OSFM determined that Herr Petroleum must pay a $100,000 deductible before it could be

reimbursed from the State’s Underground Storage Tank (UST) Fund for costs of a leaking UST

environmental cleanup at the gasoline station.

See

415 ILCS 5/57.9(c)(2) (2002); 35 Ill. Adm.

Code 101.300(b), 105.504(b). Herr Petroleum contends that the OSFM erred in determining that

a $100,000 deductible applied instead of a $10,000 deductible. The Office of the Attorney

General, on behalf of the OSFM, filed a motion to dismiss Herr Petroleum’s petition or, in the

alternative, for summary judgment in favor of the OSFM.

For the reasons below, the Board grants the OSFM’s motion for summary judgment and

affirms the OSFM’s $100,000 deductible determination. The Board first describes the

procedural history of this case and the applicable statutory provisions. Next, the Board sets forth

the undisputed facts, followed by the parties’ arguments. The Board then discusses the law and

renders its decision.

PROCEDURAL HISTORY

On December 18, 2002, Herr Petroleum filed a petition with the Board to review the

OSFM’s November 12, 2002 determination of the applicable UST Fund deductible.

On January

9, 2003, the Board accepted the petition for hearing. The OSFM filed a motion to dismiss or, in

the alternative, for a judgment in its favor, on February 6, 2003. Herr Petroleum filed a response

to the motion on February 20, 2003.

On February 28, 2003, the OSFM filed the record on

which it based its determination.

The Board cites Herr Petroleum’s petition as “Pet. at _.”

The Board cites the OSFM’s motion as “Mot. at _” and Herr Petroleum’s response as “Resp. at

_.”

APPLICABLE STATUTORY PROVISIONS

The UST Fund was created under the Environmental Protection Act (415 ILCS 5/1

seq

. (2002)) in the 1980s. The Fund may be accessed by eligible UST owners and operators to

help pay for the environmental clean up of leaking petroleum USTs. In addition, the UST Fund

is used to satisfy the financial assurance requirements of owners and operators.

See

P.A. 84-

1072, eff. July 1, 1986;

see also

415 ILCS 5/57.11 (2002). The UST Fund consists of monies

received as fees under the Gasoline Storage Act (430 ILCS 15/4, 5 (2002)) and the Motor Fuel

Tax Law (35 ILCS 505/1

et seq

. (2002)).

Under the Environmental Protection Act, the OSFM decides whether persons are eligible

to have their cleanup costs reimbursed from the UST Fund and, if so, which deductible applies.

The UST owner or operator may appeal the OSFM’s decision to the Board.

See

415 ILCS

5/57.9(c)(2) (2002); 35 Ill. Adm. Code 105.Subpart E. Eligibility to access the UST Fund is

based on several criteria, including the following: (1) cleanup costs must be in response to a

confirmed release of specified types of petroleum from a UST; and (2) the UST owner or

operator must have registered the UST with and paid all fees to the OSFM.

See

415 ILCS

5/57.9(a) (2002). Herr Petroleum’s

eligibility

to access the UST Fund is not at issue. The OSFM

decided that Herr Petroleum is eligible. What is at issue today is Herr Petroleum’s

deductible

The OSFM decided that the highest deductible applied and Herr Petroleum has appealed that

decision to the Board.

Section 57.9(b) of the Environmental Protection Act sets forth the applicable deductibles

($10,000, $15,000, $50,000, or $100,000) for accessing the UST Fund:

b. An owner or operator may access the Underground Storage Tank Fund for

costs associated with an [Illinois Environmental Protection] Agency

approved plan and the Agency shall approve the payment of costs

associated with corrective action after the application of a

$10,000

deductible, except in the following situations:

1. A deductible of

$100,000

shall apply when none of the

underground storage tanks were registered prior to July 28, 1989

. . . .

2. A deductible of

$50,000

shall apply if any of the underground

storage tanks were registered prior to July 28, 1989, and the State

received notice of the confirmed release prior to July 28, 1989.

3. A deductible of

$15,000

shall apply when one or more, but not all,

of the underground storage tanks were registered prior to July 28,

The Board cites the OSFM’s record as “R. at _.”

1989, and the State received notice of the confirmed release on or

after July 28, 1989. 415 ILCS 5/57.9(b) (2002) (emphasis added).

FACTS

The facts of this case are undisputed. Herr Petroleum owns a gasoline station at 319 E.

Main St., Route 150, in Knoxville, Knox County. Pet. at 1. Herr Petroleum has been the owner

of this site since a gasoline service station was built there in 1988.

. at 2. Five USTs were

installed at the Knoxville site in March 1988: three USTs for gasoline (one 8,000 gallon

capacity, two 4,000 gallon); one UST for diesel fuel (2,000 gallon); and one UST for kerosene

(1,000 gallon). R. at 3, 19. Product was placed in the USTs in May 1988.

In the late 1980s, Robert J. Herr was the president of Herr Petroleum and responsible for

the corporation’s operations. Pet. at 2. In approximately 1986, Mr. Herr began to experience

“symptoms of forgetfulness and the onset of dimentia.”

. Mr. Herr is now 77 years old and “in

advanced stages of Alzheimer’s disease.”

In November 1990, Herr Petroleum registered the Knoxville site’s five USTs with the

OSFM. R. at 3. Also in November 1990, the OSFM assigned the site a facility number (3-

026408) and assessed Herr Petroleum the “1988 annual tank fee of $100 per tank,” resulting in a

total amount due of $500 for the five USTs. R. at 5.

When the OSFM assessed these fees for the Knoxville site, the OSFM also charged Herr

Petroleum the annual $100 tank fee for USTs at three other Herr Petroleum sites (facility

numbers 3-015290, 3-015291, and 3-026407), as well as a “a late registration fee of $500 per

tank” for USTs at one of these other three sites. R. at 5; Pet. at 2. The OSFM imposed no “late

registration fee” on Herr Petroleum for the Knoxville site. R. at 5.; Pet. at 2

In March 2002, Herr Petroleum reported to the Illinois Emergency Management Agency

(IEMA) a release from the three gasoline USTs at the Knoxville site. IEMA assigned the release

an “incident number” (02-0407). R. at 141; Pet. at 1. In October 2002, Herr Petroleum applied

with the OSFM for a determination of eligibility for UST Fund reimbursement and the applicable

deductible. R. at 147-50. On November 12, 2002, the OSFM determined that Herr Petroleum

was eligible to be reimbursed cleanup costs associated with the three gasoline USTs over

$100,000,

i.e.

, a $100,000 deductible applied. R. at 141-43.

PARTIES’ ARGUMENTS

Herr Petroleum’s Petition

Herr Petroleum claims that it is entitled to a $10,000 deductible under the UST Fund.

Pet. at 2-3. According to Herr Petroleum, “any failure to timely register the tanks at this property

was a clerical or innocent error caused by Robert J. Herr’s medical and mental condition.”

. at

2. Additionally, Herr Petroleum asserts that it “reasonably relied to its detriment upon the fact

that no late registration fee was assessed for this site,” maintaining that it “took no actions from

1990 to the present time to minimize the costs which it would incur in remediating petroleum

contamination” because the OSFM’s failure to assess a late fee led Herr Petroleum to reasonably

believe it would have a $10,000 deductible.

. at 3. Herr Petroleum concludes that under these

circumstances, imposing the $100,000 deductible would constitute a “severe hardship,” a

“penalty . . . disproportionate to any harm or violation which has occurred,” an “unconstitutional

taking,” and failure of due process.

OSFM’s Motion

The OSFM has moved the Board to dismiss Herr Petroleum’s petition or, in the

alternative, to enter a judgment in the OSFM’s favor. Mot. at 1. The OSFM argues that,

regardless of Herr Petroleum’s reasons for not registering the USTs before July 28, 1989, the

USTs were in fact not registered by then.

. at 2. According to the OSFM, the plain and

unambiguous statutory language on deductibles contains no exception of any aid to Herr

Petroleum, and the Board cannot read one into the Environmental Protection Act.

. at 3.

Herr Petroleum’s Response

In its response to the OSFM’s motion, Herr Petroleum states that as a gasoline station

owner in Illinois, it has fulfilled its obligations to pay sums into the UST Fund and to register its

USTs. Resp. at 1, 3. Herr Petroleum reiterates that beginning in 1986, Robert J. Herr “was beset

by forgetfulness and experiencing the onset of dimentia.”

. at 3. Herr Petroleum maintains

that the USTs at its Knoxville gasoline station were not registered by July 28, 1989, because by

that time Robert J. Herr was “gripped by senility and mentally unable to function as an

owner/operator under the statute.”

. Under these circumstances, Herr Petroleum argues, it

should be subject to the “default deductible” of $10,000 instead of the “heightened deductible of

$100,000.”

. at 3.

Herr Petroleum also asserts that the State of Illinois failed to provide it “adequate process

under the law” because the “‘notice’ embodied by the statute was inadequate to inform Robert J.

Herr of the need to register the tanks by mid-1989.” Resp. at 3. Herr Petroleum continues:

The state’s subsequent failure to inform Herr Petroleum of the late registration or

bring attention to the situation via imposition of a “late registration fee” when the

tanks were eventually registered exacerbated the failure of the state to provide

notice to Robert J. Herr.

. at 3-4.

Herr Petroleum concludes that “[b]ut for the state’s failure of process,” Herr Petroleum would be

entitled to the $10,000 deductible.

. at 4.

DISCUSSION

Before analyzing the issues and ruling on the OSFM’s motion for dismissal or,

alternatively, for judgment in its favor, the Board discusses the standard for reviewing the

OSFM’s motion.

Standard for Reviewing the OSFM’s Motion

Initially, the Board notes that the OSFM’s motion does not contest the sufficiency of Herr

Petroleum’s petition for review, but rather asserts that there are no disputed facts in this case and

that the OSFM is entitled to judgment as a matter of law. Mot. at 2-3. Therefore, the motion,

besides being untimely as a motion to dismiss,

is best construed as a motion for summary

judgment.

Summary judgment is appropriate when the pleadings, depositions, admissions,

affidavits, and other items in the record, show that there is no genuine issue of material fact and

that the moving party is entitled to judgment as a matter of law.

See

Dowd & Dowd, Ltd. v.

Gleason, 181 Ill. 2d 460, 483, 693 N.E.2d 358, 370 (1998);

see also

35 Ill. Adm. Code

101.516(b). When ruling on a motion for summary judgment, the Board “must consider the

pleadings, depositions, and affidavits strictly against the movant and in favor of the opposing

party.” Dowd, 181 Ill. 2d at 483, 693 N.E.2d at 370.

Summary judgment “is a drastic means of disposing of litigation,” and therefore the

Board should grant it only when the movant’s right to the relief “is clear and free from doubt.”

Dowd, 181 Ill. 2d at 483, 693 N.E.2d at 370, citing Putrill v. Hess, 111 Ill. 2d 229, 240, 489

N.E.2d 867, 871 (1986). “Even so, while the nonmoving party in a summary judgment motion is

not required to prove [its] case, [it] must nonetheless present a factual basis, which would

arguably entitle [it] to a judgment.” Gauthier v. Westfall, 266 Ill. App. 3d 213, 219, 639 N.E.2d

994, 999 (2d Dist. 1994).

Board Analysis

The Environmental Protection Act states that a $10,000 deductible applies before a UST

owner or operator will be reimbursed its cleanup costs from the UST Fund, but the deductible

increases to $100,000 if

none

of the USTs at the site were registered before July 28, 1989.

See

415 ILCS 5/57.9(b)(1) (2002). Herr Petroleum concedes that none of the USTs at its Knoxville

gasoline station were registered before July 28, 1989. It is undisputed that all five USTs were

registered in November 1990. Nevertheless, without citing any supporting legal authority, Herr

Petroleum argues that it is entitled to the $10,000 deductible for several reasons.

Alleged Failure of the State to Provide Adequate Process

Herr Petroleum does not claim that the OSFM made any misrepresentations to it, let

alone a misrepresentation with knowledge of its falsity, as minimally required to establish

equitable estoppel against a public entity.

See

Community Landfill Co. v. PCB, 331 Ill. App. 3d

1056, 1061-62, 772 N.E.2d 231 (3d Dist. 2002). Instead, Herr Petroleum argues that it is entitled

to the lowest deductible because the State

statute

served as inadequate notice of the company’s

legal duty to register the USTs “by mid-1989.” Resp. at 3. Further, according to Herr

A motion to dismiss must be filed within 30 days after service of the challenged document.

See

35 Ill. Adm. Code 101.506.

Petroleum, the OSFM should have notified it that the company was late in registering, including

by assessing a $500 per tank “late registration fee.”

Herr Petroleum misunderstands the applicable statutes. At the time, the Gasoline Storage

Act required Herr Petroleum to register the five USTs not by mid-1989, but by early 1988. The

statute required USTs being

installed after September 24, 1987

to be registered with the OSFM

before installation

See

P.A. 85-861, eff. Sept. 24, 1987 (adding Section 4(b)). Herr Petroleum

was therefore required to register its USTs before their March 1988 installation. The date of July

28, 1989, was not a registration deadline under the Gasoline Storage Act, but rather the effective

date of the deductible provisions under the Environmental Protection Act.

Regulated entities, such as UST owners and operators, are responsible for complying

with the laws that apply to them. This responsibility cannot be foisted upon the State, as Herr

Petroleum argues. “It is the responsibility of companies doing business in Illinois to determine

whether they are complying with Illinois’ environmental laws. * * * Companies cannot . . .

simply assume that they are not violating Illinois’ environmental laws.” People v. Panhandle

Eastern Pipe Line Co., PCB 99-191, slip op. at 21 (Nov. 15, 2001) (rejecting alleged affirmative

defense and penalty mitigation based on State’s failure to uncover company’s violations sooner).

Herr Petroleum’s statement that because the company assumed a $10,000 deductible

would apply, it “took no actions” for twelve years “to minimize the costs which it would incur in

remediating petroleum contamination” (Pet. at 3) is as irrelevant as it is troubling. Moreover,

contrary to Herr Petroleum’s suggestion, the $500 “late registration fee,” which the OSFM

assessed against Herr Petroleum for another site, did not apply to the Knoxville site. Under the

Gasoline Storage Act, the late fee applied to unregistered USTs that contained petroleum

between January 1, 1974, and September 24, 1987

See

P.A. 85-861, eff. Sept. 24, 1987, P.A.

85-1324, eff. Jan. 1, 1989;

see also

13 Ill. Reg. 14992, eff. Sept. 11, 1989 (adding 41 Ill. Adm.

Code 170.72). Product was not placed in the USTs at the Knoxville gasoline station until

May

1988

. The Board finds no deprivation of adequate process.

Alleged Hardship and Penalty

Herr Petroleum argues that applying the $100,000 deductible would constitute a severe

hardship and a disproportionate “penalty.” Pet. at 3. In this case, the Board is in no different a

position than was the Fourth District Appellate Court in Stroh Oil Co. v. OSFM & PCB, 281 Ill.

App. 3d 121, 130, 665 N.E.2d 540, 547 (4th Dist. 1996): “Even if we regarded the $85,000

difference in deductibles as excessive [$100,000 instead of $15,000 deductible], those concerns

are properly addressed to the legislature, not the courts.”

Herr Petroleum was two and one-half years late in registering the five USTs. The law

made failing to register a UST a “business offense punishable by a fine of not more than $10,000

per day.” P.A. 85-361, eff. Sept. 24, 1987. Under similar facts, the Stroh Oil court stated:

Stroh could have been assessed statutory fines in excess of $7 million for its

failure to register its USTs from September 24, 1987, to October 28, 1989. Thus

Stroh cannot justifiably object to imposition of the $100,000 deductible for failing

to fulfill its statutory obligations after 764 days of noncompliance, especially

where Stroh is merely attempting to access state funds to cover costs for which

Stroh could legitimately be held liable in the absence of the UST Fund. Stroh Oil,

281 Ill. App. at 130-31, 665 N.E.2d at 548.

The Board likewise finds no merit in Herr Petroleum’s position.

Taking

Herr Petroleum asserts that applying the $100,000 deductible in this case constitutes an

“unconstitutional taking” by the government. Pet. at 3. The case law rejects this position.

Payment of the $100 per UST registration fee into the UST Fund is “similar to an automobile

owner paying a fee to register his car with the State or his locality rather than being an insurance

premium entitling the payor to coverage.” Rockford Drop Forge Co. v. PCB, 221 Ill. App. 3d

505, 582 N.E.2d 253, 259 (2d Dist. 1991) (denial of eligibility, despite payment of registration

fee, is not a governmental taking of private property without just compensation). The Board

finds no taking here.

Robert J. Herr’s Mental Condition

Herr Petroleum argues that Robert J. Herr’s mental condition in the late 1980s entitles it

to the lowest deductible. Again, Herr Petroleum offers no supporting legal authority for its

position. No one questions that Robert J. Herr’s described condition is most unfortunate. The

Environmental Protection Act’s language, however, is clear and affords no exceptions. The

Illinois Supreme Court has held:

Where, as here, the language in a statute is clear and unambiguous, we are not at

liberty to depart from the plain language and meaning of the statute by reading

into it exceptions, limitations, or conditions that the legislature did not express.

Citizens Organizing Project v. Department of Natural Resources, 189 Ill. 2d 593,

599, 727 N.E.2d 195, 198 (2000);

see

also

D.D., 196 Ill. 2d 405, 419, 752

N.E.2d 1112, 1120 (2001).

As the OSFM argues, the Board is without power to accept Herr Petroleum’s invitation to

ignore a statutory requirement.

CONCLUSION

Herr Petroleum has presented no factual basis that would arguably entitle it to prevail in

this appeal. Considering the pleadings strictly against the OSFM and in favor of Herr Petroleum,

the Board finds that there are no genuine issues of material fact and that the OSFM is entitled to

judgment as a matter of law. The Board therefore grants the OSFM’s motion for summary

judgment and affirms the OSFM’s decision to apply a $100,000 deductible before Herr

Petroleum can be reimbursed from the UST Fund. The Board closes the docket.

IT IS SO ORDERED.

Section 41(a) of the Environmental Protection Act provides that final Board orders may

be appealed directly to the Illinois Appellate Court within 35 days after the Board serves the

order. 415 ILCS 5/41(a) (2002);

see also

35 Ill. Adm. Code 101.300(d)(2), 101.906, 102.706.

Illinois Supreme Court Rule 335 establishes filing requirements that apply when the Illinois

Appellate Court, by statute, directly reviews administrative orders. 172 Ill. 2d R. 335. The

Board’s procedural rules provide that motions for the Board to reconsider or modify its final

orders may be filed with the Board within 35 days after the order is received. 35 Ill. Adm. Code

101.520;

see also

35 Ill. Adm. Code 101.902, 102.700, 102.702.

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

adopted the above order on March 20, 2002, by a vote of 7-0.

Dorothy M. Gunn, Clerk

Illinois Pollution Control Board