ILLINOIS POLLUTION CONTROL BOARD
October 25, 1990
PEOPLE OF THE STATE OF
ILLINOIS,
Complainant,
PCB 90—84
v.
)
(Enforcement)
WE-TOAST BREAD, INC.
an Illinois Corporation,
Respondent.
DISSENTING OPINION (by J.D. DuInelle and J. Theodore Meyer):
We dissent from the Board’s action today for a variety of
reasons. First, we believe that the Board is under an
affirmative duty to be an active participant rather than an
administrative rubberstamp when it ratifies stipulated
settlements. Second, we believe that the existing process for
approving these settlements is deficient in that the information
we are supplied prior to ratification is lacking the basic
information in order to reach an informed decision. Finally, we
believe that the permitting system is a significant aspect of
regulatory enforcement.
This matter is an enforcement action brought against
Respondent We—Toast Bread, Inc. (“We-Toast”) by the State of
Illinois. The two parties entered a stipulation and proposal for
settlement and sought Board ratification. On August 30, 1990,
the Board issued an order seeking more information regarding
material facts and/or mitigating factors because the duration of
the violation and the penalty amount stipulated to appeared
inconsistent.
Pursuant to the Board’s Order, the Attorney General and the
respondent filed a supplement on October 15, 1990, outlining the
reasons for the execution of the settlement agreement. This
supplemental filing contained a significant amount of material
information as well as a legal analysis regarding fines for
permit violations. Based upon this filing, the Board approved
the stipulation by a 5—2 vote.
At issue in this case was the Board’s concern that the
$3,000 penalty assessed might be inadequate due to the fact that
We—Toast had operated eleven pieces of equipment emitting air
pollution into the environment for a period of eighteen years.
On its face, this seemed to be a low penalty in the absence of
any mitigating factors. Of equal importance to us, however, is
our belief that We—Toast represents a pattern whereby the Board
accepts generic stipulated settlements which are devoid of
material facts and other valid considerations.
115—433
—2—
In Chemetco v. Pollution Control Board, 140 Ill. App. 3d.
283 (5th Dist. 1986), the court held that a respondent could
enter into a stipulation with a penalty and still avoid any
admission of violation under the Act. In doing so, the Court
analyzed the Board’s settlement procedures contained in Section
103.180 of our procedural rules. The court stated:
Thus, from the aforementioned rule, it is
undeniable that settlements are of the Board’s
own making and comport with the purposes of
the Act.
Chemetco at 287. (Emphasis added.)
This leads us to believe that the Board is under a duty to be a
participant. Accordingly, it does not seem unreasonable to
expect a summation of material facts in addition to what
statutory factors were considered. Instead, the Board receives
pages of boilerplate which outlines the factors but does not
explain how the facts in the case apply to those factors.
While we do believe that a $3,000 penalty is too low for
numerous violations encompassing eighteen years, we are equally
unaware of the criteria considered in cases where larger fines
are levied. At the very same Board meeting, for example, Crown
Cork and Seal (PCB 89—159) entered into a stipulation with the
state and agreed to a $16,000 fine. Based on the filings in
these cases, we are unable to ascertain the differences
—
with
the exception that the violations in We—Toast spanned a longer
time period. In short, we are unable to determine the factors
which lead to an assessment of a penalty/fine, and we are unable
to see how other Board members can.
The case at bar also exemplifies another disconcerting
point. We—Toast admitted violations spanning a time period of
nearly two decades. Other recent stipulations such as Miller
Fluid (PCB 90—93) and Magnaflux (PCB 90—107) have also
encompassed long time periods with admitted violations. How many
others are out there? Why is the Agency unaware of them?
As far as the importance of the regulatory system is
concerned, the Attorney General submits that courts have taken a
dismal view of permit violations alone; and that they are not apt
to uphold a stiff penalty absent adverse environmental impact.
Yet the cases cited are entirely distinguishable from the one at
bar. Citizen’s Utilities v. PCB, 127 Ill. App.3d 504 (1984) and
East Moline v. PCB, 133 Ill. App.3d 431 (1985) are site—specific
problems. Moreover, the circumstances involved are replete with
mitigating factors. These fines were reduced because the courts
believed that the imposition of penalties in their cases would
not aid in enforcement of the Act in that the parties had done
something affirmative in order to achieve corrective action
during the period of violation.
115—4 34
—3—
In Trilla Steel Drum v. PCB, 180 Ill. App. 3d 1010 (1989),
the court was presented with a totally different set of facts.
In this case, the Board attempted to penalize the company $10,000
for operating without a permit for 15 months.1 Yet the company
had applied for a permit and it was denied by the Agency. In
light of that denial, the company subsequently sought and was
granted a variance by the Board. During the course of the entire
period, the company was negotiating with the Agency and
concurrently seeking alternative methods to comply with the
regulations.
Similarly, in Modine Manufacturing v. PCB, 193 Ill. App. 3d
643 (1990), the court reduced the Board’s assessment of a $10,000
fine to $1,000. The court held that Modine’s actio9 did not
warrant a fine of $10,000 for a variety of reasons. Like
Trilla, Modine had applied for a permit but was rejected by the
Agency. Also like Trilla, the company had worked extensively
with the Agency in order to rectify the identified
deficiencies. Indeed, Modine has spent $322,000 for new
technology in addition to hiring outside consultants within the
course of two years. In short, the good faith demonstrated by
Trilla and Modine is not readily apparent in the instant case as
well as other similar cases where corporations have successfully
bypassed the permitting system. If in fact it does exist, (i.e.,
the transgressions were inadvertent) this information is
unascertainable by the information provided to the Board within
the settlement agreement. In sum, where mitigating circumstances
exist, the parties should include those facts in the signed
stipulation.
We also believe that it is misrepresentation to broadly
state that courts have dismissed the permitting process as
inconsequential. In Standard Scrap v. PCB, 118 Ill. App.3d 1041
(1983), the Court found that:
Standard Scrap’s bad faith is further
evidenced by the fact that it admittedly never
had the required operating permits from the
Agency for its furnace and incinerator, and
that it failed to secure an operating permit
for its boiler from February 1974 until 1983.
Contrary to Standard Scrap’s contention,
violation of the Act’s permit requirement is
not a mere “paper” or “minor” violation.
1This would be akin to penalizing a company $50,000 today
under the current penalty structure in that $10,000 represented
the m~ximumfine at that time.
‘The $10,000 amount would likewise represent the maximum
fine under the then existing penalty provisions.
115—4 35
—4—
Rather, the violation of a permit requirement
goes directly to the heart of the State’s
enforcement program and ability to protect
against environmental damage. The permit
program is a method through which the State of
Illinois can control emitters on contaminants
into the atmosphere, as well as emissions that
may result in the presence of contaminants in
the environment. (See Currie, Enforcement
Under the Illinois Pollution Law 70 Nw.L. Rev.
389, 476 (1976).)
(118 Ill. App. 3d at 1045) (Emphasis added.)
Moreover, in People v. Keevin, 385 N.E~2d804, the court
held that where the state alleged that owners of an apartment
complex failed to obtain a permit as required by the Agency prior
to installing a wastewater device, in order to secure an
injunction (the effect of which would be a shutdown) the state
need only show that: (a) a permit was required, and (b) that the
entity subject to that regulation failed to procure the permit.
The appellate court stated that the circuit court had no
discretion but must issue the injunction once these two prongs
were established. That holding demonstates that the appellate
courts believe that operating without a permit is indeed a
serious violation of the Act and regulations. The Board also
notes that if the Agency were to refer cases to the Attorney
General as soon as it becomes aware of the situation rather than
after compliance has been secured, the Attorney General could
obtain an injunction shutting down a facility. Such an event
would surely aid in enforcement of the Act.
These decisions underscore the significance of the
permitting system. As in the instant case, we have witnessed a
pattern of cases where companies do not possess permits for
nearly two decades. The obvious regulatory dilemma remains that
if one were to be caught, the penalty is so minimal that there
exists no incentive to obtain the necessary permits. The message
being sent is that it pays to pollute in Illinois. Yet another
serious ramification exists. The purpose of the permitting
system is to ascertain the amount of the particular matter being
emitted and set limits accordingly. The amount a company may
emit is necessarily related to overall output. If a large group
of generators are bypassing the permitting system, it is those
who have submitted to regulations who are paying for the
scofflaw’s pollution because the amount they are allowed to emit
in their permits may be is based upon the overall sum of
pollution that is known (i.e. from existing permits). Needless
to say, such a result is both inequitable and contravenes the
intent of the statute.
Finally, we are bothered by the Attorney General’s
115—4 36
—5—
explanation as to why the earlier request for costs and fees,
pursuant to Section 42(f) of the Act, was not included in the
stiuplation. The Board asked the Attorney General to address
this issue in the October 15 supplemental filing. The response
the Board received was that the attorney time spent on this
proceeding was considered when the stipulated penalty was
negotiated. If indeed the $3,000 penalty includes attorney time,
the actual penalty for We-Toast’s 18 years of violations is even
lower than we originally believed. We are concerned that these
low penalties, for lengthy violations, do not even cover the
costs of prosecuting the action.
For these reasons, we dissent.
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_________________
/Ja~o~bD. Dumelle, P.E.
7
Board Member
Li
i, Dorothy M. Gunn, Clerk of the Illinois Pollution Control
Board, hereby certify that the above Dissenting Opinion was
submitted
on
the
___________
day of
~
,
1990.
J4Theodore Meyer
Board Member
Ill
liution Control Board
115—437
.
.