BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
vs. ) PCB No. 03-146) (Permit Appeal)
Submitted by
NORTH SHORE SANITARY DISTRICT,Petitioner,
By MOHAN, ALEWELT, PRILLAMAN & ADAMI,Its counsel
By________Pa4i~k-tX~’Shaw
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
NORTH SHORE SANITARY DISTRICT,Petitioner,
CERTIFICATE OF SERVICE
,~2~ntlrIhaw
The Parties
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:
ANSWER:

OPERATING THE FACILITY WITHOUT LOCAL SITING APPROVAL
ANSWER:
ANSWER:
COUNTYCLAIM FOR DECLARATION THAT NSSD IS REQUIRED TO COMPLY WITH THE
WAUKEGAN BUILDING CODE
ANSWER:
ANSWER:

RECEIVED

ClERK’s

OFF!CF

/~PR23

2003

BEFORE

THE

BOARD

STATE

OF IWNOIS

NORTH SHORE

SANITARY 01ST

llutlon Control Board

Petitioner,

)

PCB No. 03-146

)

(Permit Appeal)

ILLINOIS ENVIRONMENTAL

)

PROTECTION AGENCY,

)

Respondent.

)

NOTICE OF FILING AND PROOF OF SERVICE

TO:

Dorothy Gunn, Clerk, Illinois Pollution Control Board,

100

West Randolph Street,

James R. Thompson

Center, Suite

11-500, Chicago, IL 60601-3218;

Bradley Halloran, Hearing Officer,

Illinois Pollution Control Board,

100 West Randolph

Street, JamesR. Thompson Center, Suite

11-500, Chicago, IL 60601

Robb

Layman, Division of Legal Counsel,

Illinois Environmental Protection Agency,

101

North Grand Avenue East,

P.O. Box

19276, Springfield,

IL 62794-9276

PLEASE TAKE NOTICE that on April 21, 2003, I filed with the Office ofthe Clerk of

the Pollution Control Board

an original and

four copies ofthe

Petitioner’s Motion to

Compel

and For Expedited Ruling Directed to Hearing Officer by U.S.

Mail.

The undersigned certifies that he

served

the Petitioner’s Motion

to Compel and For

Expedited Ruling Directed to Hearing Officer by mailing a copy to

the above

persons by U.S.

Mail on April 21, 2003.

NORTH

SHORE SANITARY DISTRICT,

Petitioner

By its attorneys,

MOHAN, ALEWELT, PRILLAMAN &

ADAMI

By________

Patrick 0.

Shaw

Mohan, Alewelt, Prillaman

& Adami

North

Old

Capitol Plaza

Suite 325

Springfield, IL 62701-1323

Telephone: 217/528-2517

Facsimile:

217/528-2553

C:\Mapa\NSSD\NoticeofFiling.wpd\PDScrk\4\2

l\03

)

BEFORE THE ILLINOIS

POLLUTION CONTROL BOARD

NORTH

SHORE SANITARY

DISTRICT,

)

Petitioner,

)

vs.

)

PCB

No. 03-146

)

(Permit Appeal)

ILLINOIS ENVIRONMENTAL

)

PROTECTION AGENCY,

)

Respondent.

)

PETITIONER’S MOTION TO COMPEL AND

FOR EXPEDITED

RULING DIRECTED

TO HEARING OFFICER

NOW COMES Petitioner, NORTH SHORE

SANITARY DISTRICT

(hereinafter

“NSSD”), by its undersigned counsel, pursuant to Section

101.618(h) ofthe Board’s procedural

rules

(35

III. Admin. Code

101.618(h)), and moves the hearing officer to strike the objections

ofthe ILLINOIS ENVIRONMENTAL PROTECTION AGENCY (hereinafter “the IEPA”) to

Petitioner’s Request to Admit,

states as follows:

On March 27,

2003, NSSD served Petitioner’s Request to Admit on the IEPA,

a true

and correct copy of which is attached hereto

as Exhibit

On April

17, 2003, the IEPA objected to

fourteen ofthose requests.

A true and correct

copy ofthe IEPA’s Responses to

Petitioner’s Request

to Admit are attached hereto as Exhibit

The IEPA has objected on grounds of relevancy to those requests pertaining to the

litigation between the City of Waukegan, NSSD

and the IEPA.

Specifically, the IEPA objects to

requests pertaining to

the circuit court lawsuit in City ofWaukegan v. NSSD & IEPA,

01CH1777 (Req.

Admit ¶5 -~8,

¶10

¶14), the appellate proceedings

in City of Waukegan v.

NSSD & IEPA, No. 2-02-0635 (Req.

Admit ¶15

¶18),

as well as matters preliminary to

said

litigation.

(Req.

Admit ¶4)

The IEPA claims that

the City of Waukegan litigation is “neither relevant nor

calculated to

lead to relevant

information that relates to

the subject matter of this proceeding.”

(Resp. Req.

Admit ¶4

¶8, ¶10

¶18)

The IEPA’s objection is frivolous and entirely without merit.

To briefly summarize

the background of this permit appeal:

NSSD asked the IEPA

to revise the expiration date on its

existing construction

permit due to

its inability to proceed with construction in

light of the pending

litigation.

(Pet.

Rev.

Ex. B)

IEPA responded by requesting nineteen items of additional information,

including additional justification as to

the pending litigation.

(Pet.

Rev. Ex.

at 1)

NSSD appealed the IEPA’s decision and moved to

stay the expiration of the

existing construction permit.

In granting NSSD’s motion,

the Board

expressly made, and

relied upon,

preliminary findings regarding the pending litigation.

(Order of March 20,

2003, at 2)

The City of Waukegan litigation has been relevant at all

stages of this

permit appeal,

including the Board’s own preliminary evaluation of the issues

in dispute.

The circuit court and appellate court filings which make up the City of Waukegan

litigation are public records of which the Board may take official notice.

(35 Ill.

Admin.

Code

101.630; ~

Morton College Board ofTrustees v. Town of Cicero, PCB 98-59 (Jan.

12,

1989);

Callils

v. Norfolk

& Western Railway,

195

Ill.

356,

363

(2001)) Instead of filing the thousands of

pages of these public

records, NSSD has asked the IEPA

to admit the genuineness of a

few

documents and

the accuracy of a few statements which summarize the City ofWaukegan

litigation.

The purpose of requests such admissions is “to separate the wheat from the chaff” by

allowing contested

issues

to be clearly and succinctly presented to the trier offact.

P.R.S. Int’l v.

Shred Pax Corp.,

184

III.

224,

237

(1998).

a party to

the City ofWaukegan litigation, the IEPA is well aware of the nature of

those proceedings and their relevance herein.

The Board should likewise be allowed access to

this information.

Given that the hearing in this matter is scheduled for May

15, 2003,

Petitioners request

an expedited ruling in this matter to ensure that the discovery issues are resolved prior to

hearing.

WHEREFORE Petitioner prays for an order striking the objections

(1J4-118, ¶10 -~18)

and

either deeming the requests admitted or compelling a response thereto

at least one week prior to

trial, or for such other and

further relief as the Hearing Officer deems meet and just.

Submitted by

NORTH

SHORE

SANITARY DISTRICT,

Petitioner,

By MOHAN, ALEWELT, PRILLAMAN & ADAMI,

Its

counsel

By________

Pa4i~k-tX~’Shaw

BEFORE THE

ILLINOIS

POLLUTION

CONTROL BOARD

NORTH SHORE

SANITARY DISTRICT,

)

Petitioner,

)

Vs.

)

PCB No. 03-146

)

(Permit Appeal)

ILLINOIS ENVIRONMENTAL

)

PROTECTION AGENCY,

)

Respondent.

)

PETITIONER’S REOUEST TO

ADMIT

Petitioner, NORTH SHORE

SANiTARY

DISTRICT

(“NSSD”), hereby requests

Respondent, ILLINOIS ENVIRONMENTAL PROTECTION AGENCY (“IEPA”), pursuant to

Section

101.6 18

of the Board’s procedural rules

(35

Ill. Admin.

Code

101.6 18),

to admit the

truth of the following facts and/or the genuineness ofthe following documents.

Failure to

respond to the following requests to

admit within 28

days may have severe consequences.

Failure to respond to

the following requests will result in

all the facts requested being-deemed

admitted as true for this proceeding.

Ifyou have any questions about this procedure, you should

contact the hearing officer assigned to

this proceeding or an attorney.

On April

17, 2001,

the mPA received an application

from NSSD for an air emissions

construction permit (“air permit application”).

A true and correct copy of the first nine pages ofthe technical

support document filed

with the application for an air permit is attached hereto as Exhibit A.

On July 27,

2001, the IIEPA issued a draft construction permit for a sludge

dryer/melter (“draft air permit”).

____________________________

EXHIBIT

On September

25,

2001, the EPA rejected a demand made by the City of Waukegan

that

the hearing on the draft air permit be canceled in the absence of a siting approval issued by

the Waukegan City Council.

On December 6,

2001,

the City ofWaukegan,

its mayor

and members of its city

council filed a Verified Complaint for Injunctive

and DeclaratoryRelief in the Circuit Court of

Lake County against the illinois Environmental Protection Agency (“EPA”)

and the North Shore

Sanitary District (“NSSD”), which was given case number 01CH1777 (“circuit court lawsuit”).

Attached as exhibits to

the complaint in

the circuit court lawsuit were copies of the air

permit application and the draft airpermit.

Counts I through VI of the complaint sought, inter alia,

stop the issuance of any

permit by the EPA without proofof local

siting approval and Counts VII through X ofthe

complaint, sought, inter alia,

stop the construction ofthe project without first

obtaining

building/zoning

approvals.

On February 27, 2002, the circuit court dismissed the lawsuit on the grounds

that the

plaintiffs “have no standing to

seek a Court intervention on

these issues at this time,” namely

prior to

the issuance of a permit.

March 11,

2002, the EPA

issued

a construction permit to NSSD, a true and correct

copy of which is attached as Exhibit A to

the Petition for Permit

Review.

On April

15,

2002,

the City ofWaukegan filed a motion

for leave to

reinstate its

lawsuit by filing an

amended complaint.

The City ofWaukegan was subsequently granted leave to file an amended complaint.

10.

On May

2002, NSSD filed its Verified Answer and Counterclaims of Defendant

North Shore Sanitary District

Waukegan’s Amended Complaint, a true and correct copy of

which is attached hereto as Exhibit

11.

On June

18, 2002, the Circuit Court ofLake County dismissed the circuit court

lawsuit with respect to

local siting approval issues.

12.

Furthermore, on June

18, 2002, the Circuit Court ofLake County found that the ~

Flames trilogy of cases relied upon by NSSD for its

argument that NSSD

is exempt from local

zoning had been overruled.

13.

The court’s June

18, 2002, rulings have been appealed to the Illinois Appellate Court,

Second District,

where the appeal remains pending.

14.

On February 18, 2003, the Circuit Court of Lake County entered

a temporary

restraining order against NSSD

from “beginning any construction activity on the subject site in

an effort to

construct the facility atissue.”

15.

On March

2003, the Circuit Court ofLake County converted the tempororary

restraining order into

a preliminary injunction.

16.

Attached hereto

as Exhibit C

is a true and correct copy ofthe Memorandum of

DefendantlCounter-PlaintiffiAppellant North Shore Sanitary District in

Support ofAppeal

Pursuant to Rule 307(d) ofthe illinois Supreme Court.

Submitted by

NORTH

SHORE

SANITARY DISTRICT,

Petitioner,

By MOHAN, ALEWELT, PRILLAMAN &

ADAMI,

Its

counsel

CERTIFICATE OF SERVICE

I, the undersigned, certi~

that I have served the Petitioner’s Request to Admit, by U.S.

Mail on the

27th

of March,

2003, upon the following person:

Robb H.

Layman

Special Assistant

Attorney General

Illinois Environmental Protection Agency

1021

North Grand Ave. East

P.O. Box

19276

Springfield, IL 62794-9276

Fred C. Prillaman

Patrick D.

Shaw

MORAN, ALEWELT, PRILLAMAN & ADAMI

One North Old

State Capitol Plaza

Suite 325

Springfield,

IL 62701

217/528-2517

,~2~ntlrIhaw

B’

~J0j~Ch

TECtINICALSUPpQRTOQCIJMENTAf4D

1. 31flSXH

bxy CiCid

CONSTRUCTION PERMIT APPLICATiON

NORTH SHORE

SANITABY DISTRICT

WAUKEGAN, ILLINOIS

1.0

INTRODUCTiON

The North

Shore

Sanitary

Disnict

(NSSD)

submitting

this

Tcchniéal

Support Document and

Construction

Permit Application forms

to the

Uhinois Environment~lProtection

Agency

(TEPA)

for the installation’of slutheldryini and melting ‘equfpmeth that will allow

NSSD

process

its

wastewater sludgc

into

glass

‘âggreg~te.

This

pmcc~swill

eliminate

the

need

for

its

surface

disposal while yielding ~ valuable, environmentally inert,

product.

The

new

glass

aggregate

equipment

wilt’

built

the

existing

NSSD

Waukegan

Sewage

Treatment

Plant

Dahringer Road,

Wankegan

Illinois.

The

construction

permit

application

addresses

aiF air

emission ~ources

and

operations planned

for the

new

processing

equipment.

NSSD requests expedited review ‘of this permit application.

Appendix A to this Technical Support Document contains the ~PA

Permit Application forms.

2.0

PROJECT

DESCRiPTION

The

proposed

facility

will

prodtice

glass

aggregate

from

14550’s

wastewater -sludge.

Glass

aggregate

inert,

marketable

product which

has

broad

range

uses

construction.

Nationwide.

wastewater treatment’distriéts are implementing

environmentally

beneficial

re-uses

for wastewater sludge.

The proposed project will

allow NSSD to eliminate

the need to landfiul

w’astewater

solids

from

all threeouitrfacilities.

‘

The

project

will

have

numerous environmental

benefits,

indluding allowing

the Closure of

the

District’s sludge landfill,

reducing

the potential for any

soil and groundwater

contamination

and

tliminaxing it

potential

odor

source.

Other.benefits

Includi elirninating..one’third of

the

sludge truck traffic and~associated

odor ernissibns inLakeCoutity.

The

process

uses

ozygen.rich~closed loop melting system.

Pre-dried sludge is stkected

high

tempeiatures in

oxygen-rich

atmosphere.

The

high

temperatures

will

cause

the non-

combustible

sludge material to melt.

Quenching

thc molten

material yields thehighly inert

product.

By bringing

all

sludge

processing within

enclosed building, the project

able to

utilize a state-of-the-art

odor control system

virttaily eliminate this environmental impact

The proposed project consistiof five major subsystems:

Sludge receiving and

storage

‘

TSDtsuOIblIO

‘

4c~tS&a

TECHNICAL SUPPORT DOCUMENT AND

1-3l7I9~1

CONSTRUCTION PERMIT

APPLICATION

NORTh SHORE SANITARY DISTRICT

WAUKEGAN, ILLINOIS

Sludge

dryer ant

dry granulatestorage

N4eltir

•

Air separation

unit

•

Auxiliary

heater

—

The equipment will be

designed

to ~mcess

approxithat.ely.200

tons

per day of wet sludge to

dry

Ions per

day

grantilate, and then

to~isóf

gi~ss

aggregate.

The

sludg~

feedstock

will

come from

NSSD’s

Waukegan.

Gurnee,

and Oave’~’

Road facilities.

The

equipment

has a

compict footprint and

is highly energy

efficient.

Other than a

small amount of natural

gas. al!.

the energy required to

dry thesludgefeedstock

and melt the

mineral

fraction into glass aggregate

supplied

by the energy

in the sludge’s organic

matter.

The project will

emit

number of air

contaminants and

generate a srnallqt amity of ~olid-

and

liquid

waste streams:

The

solids

an&wastewater itrearns

will

be routed back to

NSSO for

re-

processing.

The closed-loop melter generates much lowCr NO1 levels

than

alternative,

combustion-based systems.

This is

due toit~

unique oxygen-enriched combustion

system.

essentially removing nitroEen

from

the supply “air’, the closed-loop melter SducS the criic~l

ingredient for.N01 formation.

302,PM. and odor control will be accomplished using-a

---

combination of filtration ~

scrubbing technoiggy.

The

proposed

facility

will

located

in -the

northeast

com~rof- NSSDs

Waukegan

Sewage

Treatnjeñt

Plant’s

property.

site

plot

plan

is provided

with

the

permit

application

fonns

Appendix

2.1

Process Descriptions

Air

emitting

processes

and

associated

equipment

are

described

the

following sub-sections.

Figure B-I (in Appendix 3)illustrates

the

overall

process

flow

for the

?aciliry.,

2.1.1

Sludge Receiving and Storagâ

Wet sludge (approx.

moisture) will

delivered to

the

new

processing equipment by

truck

from

the Clavey-Road

and Gumee sewage treatment plants

There, it will

be dumped into oneof

TSDTwOIO*lI

-TECHNICAL

SUPPORT DOCUMENT AND

CONSTRUCTION

PERMIT

APPLICATION

NORTH SHORE SANITARY

DISTRICT

WAUKEGAN,

ILLINOIS

two

receiving

pits

within an ènclos~dbuilding.

‘rhe

Wailkegan

sewale

treaiment plant sludge

will be puiñped directly into the wet sludge silo.

Thewer

sludge

will

be conveyed from the pit to

one of two wet

sludge

silos ~storage

capacky

of 375

tons,

each)

for

storage until

reclaimed for

processing.

The

wet

sludge silo

vents will

routed

the plant’s odor

control

system

prior to cxhaustin~.

The

sludge receiving room will

be ventilated and treated in the odor control

system.

2.1.2

Sludge Dryer/Dry Granulate Silo

The

sludge dryer is designed

td evaporate

up to

13,000 pounds of moisture

per hour, yielding a

dried

granulate of approximately

moistu~e.The dryer is heated indirectly, ~via

a hot oil

heat

recovery icop from the melter.

The dryer exhaust will

be routed through

a condenser and vented

into the dry granulate silo:

Dry grantilate wilt be Conveyed from the dryer, th~ougl-t

a cooler,

150 ton capacirt silô~The

dry granulate

silo will be

vented

through

the odor control

scrubber

prior to exhausting.

2.1.3

Melter

Dry granulate is drawn

frOm the dry granulate silo, through the surge

hopper, and into

the melter,

which

operated

temperature of 2,400

to 3,000

degrees

Fahrenheit.

Oxygen

supplied

from theair separation unit to support

combustion.

In the melter, the combustible fraction of the

dry granulate

bums, while the mineral

portion forms

molten

glass;

The

glass flows through-a

drain

port

where it

drops

iñto.a ~uenchrahk

fornüng

the

gins

aggregate product.

The

melter

exhaust gal

passes through a heat

exchanger where recovered

energy heats

oil

transfer fluid

which

use ttotheat the sludge dryer.

After the heat

recOvery unit, the exhaust passes through.

particulate andS02 emission control

devices.

It is then split, with

most of the flow recirculated

the melter.

The remainder

of the gas flow is cooled and then

vehted.

The

use of an

oxygen-.

rich

combustion

environment

serves

a NO~control

technology.

significandy

reducing

potential emissions relative to using air to support combtstion.

This procesi

is disünct from the

common

defjOilion

incineration

inthat

speciffdalty.dài~iedto yield

commercial

product—glass aggregate.

In contrast,

incinerator’sprimary function is

reduce the volume

of material, with residual

material disposed of as

waste.

i.E

North

ShariSat~yOiLdd

3j7~9~j

~IIO/2I

I—

-4

TSDTu8OIDIIO

~cre5an~taiyOtsb1cj

4/1O.21

NORTh SHORE SM~tTARY

DISTRICT

WAUKEGAN,

ILLINOIS

2.1L4

Air Separation Unit

The

use

of oxygen

rather

than

air

support

melter combustion

a key

feattire

of the claged-

loop

melter

system.

Since

nitrogen

effectively

stripped

out. NO~emissions

are

greatly

reduced—resulting

primarily

from

oxidation or nitrogen

compounds

contained

the

sludge.

The

air

separation

unit

electrically_driven,

drawing

air

and

yielding

separate

streams

oxygen

(touted

to the melter)

and the balance of air constituents (pritharily

nitrogen).

As such

generates no

air pollutants, and is

not included in the permit application.

2.1.5

Auxiliary Heater

A 20 million Btuihr natural gas-fired auxiliary heatei will

used for-unit start~up

and back-up it

‘

the

melter is

not

in operation.

This heater will be

equipped with a lovc-NO~burntr

and will

•~

used

during

startup

and periods

when

the

moisture

content

the

incoming

sludge

requires

additional energy to achieve adequate drying.

2.1.6

Truck Loadout

The

dry sludge silo will be equipped-with

a trOck loadout facility to-enable diversion of material

an alternaje-site for use asfertilizerorfixelif the melter is ‘nàtinioperntion.

This

facility will

be located inside the building and will incorporate

an internally-vented püticulate filter.

2.2

EmIssion Estimates

Applicability of

federal

and Illinois air

permitting and emission

control

requirements

are

based

proposed facility’s

expected

actual emissions, and/or its

“Potential

to. Erriif

(Pit).

The

following

emission

estimates were

made

determine

regulatory- applicability

pertains

this project.

‘

Criteria pollutants

axe defined

those for which National Ambient Air Quality

Standards

have

been

adopted, or in the case of ozone, precunor~

such as volatile organic compounds.

Table 24

presents

actual

expected

and Fit

estithates for each

criteria

pollutant,

emission

source.

Emissions estimates arc also provided for selected substances which

the EPA

has designated as

Hazardous

Air

Pollutants

(MAPs).

Table

2-2

presents

the

same

information,

categorized

emission stack orvent.

TSOtosalOtII

‘

-:~-‘

•-?r~,--,:—r—-—

:‘~.~‘:‘.

I-

North

Shore Sar4taq btttrict

1’ IITIIZI

~‘1a2~1

TECHNICAL SUPPORT

DOCUMENT AND

cONSTRUcTIoN

PERMIT

APPLICATION

NORTH

SHORE

SANITARY DISTRICT

WAUKEGAN,

ILLINOIS

Table

2.1

Pollutant

Emissions, By Emission Soui-ce

Pollutant

Emission

Source;

•

—j

•

•~Expected Actual

Emissions

Potential to

Emit’

•

(PIE)

-..

NSR Major

Source

Threshold

jib/br)

•(tonfyr)

(lb/br)

(toniyr)

•

(!on/rr)

VOC

Wet

SIudae Silo

•

0.00

-0.00

Sludge

DryerISilo

2.07

4.69

1.63

7.22

Melter

0.18

0.81

028

1.25

AuxiliaryHester

OCt

‘0.06

0.11

0.48

~!-‘~&-~

Tetail~

1.27-i

‘556

—

,204

$95

25(NAA)

PMJ

PM.10

•

WetshsdgeSllo

Sludge

Dryer/Silo

0.02

0_ti

0.04

0.17

~~:zgL:f

-•

Melter

0,33

1.48

Oil

2.25

:--c~:

~-:

Auxiliary

Heater

0.02

0.08

0.15

0.67

Truck

Lcadou:

0.26

Oil

C.26

1.13

•_____________

-•

-Total

~3~~Y~-i.77-

036

4.21

‘‘-~v-2so(pSn)

NO,

•

Melter

12.70

55.65

1954

85.61

----~-~-‘

Auxiliary Heater

0.25

1.10

2.00

8.76

c-~ftt~

$W4~

Dryer/Silo

Oil

• 0:47

046

0.72

‘~~~-

Total

33.06-

57.21

•

21.71

• -

95.Q9’

:-.v~~

250 (PSDy

502

Melter

•

4.93

2159

• 753

33.22

Auxiliary

Heater

0.00

0.01

0.05

~.“.‘~-ii:A&

Total

•

4~93

21.60

---7.60

33.27.

..~2SO(PSD)-

‘

Melter

0.32

1.39

0.49

2.15

Auxiliary

Heater

0.21

0.92

LoS

7.36

Sludge Dryer/SIlo

0.26

1.13

0.40-

t.73

-:f~:;-~::-’~r~r

•

‘Total

-----~-0.79

3~4

•

247

-:11,24’

l’a~250(P$D)’

Lead

Melter

0.0058

0.0256

0.0090

0.0394

~2~’:~t~

Auxiliary

Heater

0.0000

0:0000

0.0000

‘~i~

Sludge Dryer/Silo

0.0000

-0.0000

~L~?

H-’’

-:-~53.

‘.

0.0256—

~::o.g0,o:

t0.0394,

r4~M’:r~o.6~!’

Bei7iUum

Melter

0.0001

0.0004

0.0001

0.0006

Mercury

‘

Melter

0.0068

.-r~t-:2.

‘TàS

.~0iO0M

0.0297

0,0104

0.0457

-f

described

Annusl

P1.1.10

arid

$03

emissions

contained

proposed

federally.-enIoraable

prodlaction

limits

below.

“Slgnkflcanz increase threshold, subject to nujor sowa (250

tort/yr Fit) facilities.

—

730

Tnt 020420

I-

-,1

-—

•

*•5i8~iflcaat

increase threshold subject to major saint

(250

1*1/yr Pit) facilities,

‘“Annual

PM-b

and

$O~

omissions consu~iaed

pthposed

tedersily-entarccabJe

production

Iimäs

dnezibed

below,

•

Emission calcuiacion:details

are provided

in Appendix B.

T3Dt.ieOIO4to

Noah

S/tareSsMa~’

Cisc~

31719Xl

•4/10.2001

TaMe

2.2

Pollutant Emissions, By Stack/Vent

TECHNICAL

SUPPORT DOcUMENT AND

CONSTRUCTION PERMIT APPLICATION

NORTH SHORE SANITARY DISTRICT

WAUKEI3AN, ILUNOIS

I-

I-.

Pollutant

Stack/Vent 3~

Code’

•

Expected

Actual

Emzssions

Potential

to Emit”

(Pit)

NSR Major

Source

Threshold”

:(Ib/h~-)

(ton&r)

•

(lb/br)-

(ton/yr)

(toi’Jyr)

VOC

-S-UI

1.07

4.69

1.65

7.22

..L1

3-02

•

0.28

0.81

•

0.28

•

1.25

•-.

5-03

0.01

0.06

0.11

0.48 --c.i;:-:~~

Total

1,27

556

2.04

835

25(~NAA)j

PMJ

3-01

0,28

0.22

0.30

130

~j~c~4CL~

0.33

1.46-

Oil

2.25

;!;i.~-.~--4~$

5.03

0.02

0.08

0.15

0.67

TobF

0.63

1.17

• --

036

4.21

2S0(PSD).

NO,

3.02

12.70

55.65

19.55

85.61

• ---

:~‘--~

•

•~-

&03

0.25

-1.10

2.00

8.76

3.-UI

0.11

0.47

0.16

0.72

•

Total

13.06-

57.21.

21.71-

95.09

250 (P5D)’

S0~

3432

4.93

2139

7.58

33.22

‘~:--;~:

3-03

0.00

0.01

0.01

0.05

-•

•~-•

-•

•

Total

•

433

•

22.60

7.60

•

33.27

.:-m250(PSD)-

-Co

S.02

0.32

1.39

0.49

—

215

-•

~-k.~-

3.03

0.21

•

0.92

1.68

7.36

3-01

0.26

-LI)

0.40

1.73

.t_~~-t-.:il~’:

Total

0.79

•

344-

---Y257

11.24

--~-;2S0(PSD)’

lad

3-02

0.0058

0.0256

0.0090

0.0394

S-03

0.0000

~i000O -~Mk’tHt~.

3-01

0.0000

0:0000

0.0000

- --~

.-•~--~

-~-

0.0058

0.0256

-0.0090

0,0394

~-~~:-:

BeryllIum

-3.02

0.0001

•

Total

0.0001

0.0004

0.0001,

aocco

0.0004

o.ooei-t~o.oooo

~.,;~~:.:,:::r-

0.0004”-

Mercury

5.02

0.0068

0.0291

0.0104

a0457

.z:

~:•

•~

Total- .‘t

0.006*.

0.0297

-.0Sl04J~.- 0.0457’

--:

‘$tacI~

Cons:

S-Cl-—Odor Control System

Discharge

5-02—-Melter

Stack

5-03—Auxiliary

Heater Stack

North Shore

~pA

TECHNICAL SUPPORT

DOCUMENT ANU

I-

a171g~1

•

CONSTRUCTION PEPMIT APPLICM1ON

41~200I

NORTH SHORE SANITARY DISTRICT

•

WAUKESAN, ILLINOIS

3.0

REGULATORy

REVIEW-

•

Potential

air emissions

include PMIPM.10, NO,, SO3,

carbon monoxide

(CO),

volatile

organic

‘

compounds

(VOC), and

number oftrace

maeijais

(e.g., lead,-rnercury).

In addition.

the

sludge

receiving

and

handling operations have the potential forgencrating objectionable odors.

The

potential

for significant air emissions necessitates obtaining construction

and operating air

emission permits from

the flhinois Environmental Protection Agency

emPA).

Inadditio’n

permittingrequirements, the project wilt

be subject

to aitumber of regulatoty emission limits;

and monitoring, recordkeeping, and reporting requirern~nts.The following subsections

deicribe

the

applicable air regulations and

the correspcnding elements of the project’s compliance

strategy.

3.1

Construction Permit

Northern

Lake County, Illinois is designated as a slverenon-attainment for ozone, and

attainment

for

all

other pollutants.

Therefore its-N05-and VOC emissions

are potentiallysubject

nonanainment area

(NAA)

New Source Review (NER):

PM/PM-l0.-NO~.

S02. CC, lead,

beryllium, and mercury

emissions are porentiallysubjectto Prevention of Significant

Deterioration

(PSD) NER.

NC1 is regulated under NAA NSR as an ozone precursor,

and under

P50

for compliance withtheNOj incr~n’ent

and ainbientair quality standar&

•1

The project is not subject to major source- rleviel tinder either NSR program.

It requires

a state

•

(minor source) construction permit unless

it qualiflesfor one of the specified exemptions.

Table

•

2.1

compares the cântrolledemission. estimates for these constituents with the corresponding.

major source permittingthiesholds.

•

A major modification is only subject ioNSR

itis

associatód with an-existirigmijor sothce oiif

it, by itself,

constituëes a major source.

“Major source!’ for PSD purposes is defined as a fSiiity

with emissions of any regulated poflutànc greaterthan

250 toWyr.

Ait

ozoite NAA NSR major

source is

one

that ethits more than.25 ton/yr of NO2 orVOC,

VOC emissions associated with

the

project are less than the25 ton/yrthreshold.

Since the Lake County area is covered by an

EPA

“NC2

waiver”, NO2

emissions

not tsiggerNAANSR.for this project

•

-•

•

tSOTn,OIaiIO

•

.•

North Shore SiM

tECHNICAL SUPPORT 00CUMENT AND

l.31719X1-f

•

CONSTRUCTJONPZRMITAPPUCXnO$

•

NORTH

SHORE SANITARY DISTRICT

•

WAUkEGAN,

Without

considering the proposed emission controls, theproposed project would, of itself,

constitute a

major P30 source for PM/PM-rO and SO~.

Therefore it must either proceed

with

the

FSD

permitting process or commit

federally-enforceable Umitations

that would restrict

emissions

below

the applicable major source thresholds.

Since

the proposed emission control

equipment will

maintain emissions well below the major source/significant

modification

thresholds, a permit including federally enforceable minâr source limitations is Thebasis fo~

the

application.

3.2

40 CF9 503

•

The proposed project is subjcct to the requiretiients of 40 CFR 503, “Standardsfor the Use or

Disposal of Sewage Sludge”.

This regulation establishes emission

limits, monitoring.

recordkeepi~,g.

and reporting requirements.

The regulated pollutants are CO. mercury.

beryllium,

lead, cadmium,

arsenic, nickel, chromium,

and total- hydrocarbons.

The control

measures planned fórthe project will

comply with these emission

limits.

Total hydrocarbons

and

CO arC

each limited to

100 ppm, monthly

à,~emge.The lead,

cadmium, arsenic, nickel,

and

chromium are risk-basedsludge maximum

cOñcentrátion values that mu~t

com~ned

for each-

specific

site.

3.3

New Source Performance Standards

The

auxiliary heater is subject tothe ~ubpartDc

(4OCER6O.40c) Industri~l-CommerciaI-

Institutional Stain Generating UnitNSPS.

Since the lipnter-is exclusively

natural gas-fired, the

•

NSPSdoes

not impose additional emission limits or thanitoring or reporting obligations.

•

The other proposed proc~ssing

equipment

does not m~et

the definitionofany

source category for

which a New Source Performance Standard-has

been promuigate&

3.4

MACT/NESHAPS.

•

National

NESHAPS

limits have been established for beryllium

and mercury. ‘The-beryllium and

mercury limits are

and 3200

giams/24 hours, respectiveLy.

The

Cican Air Act

defines a numbeVof-marcrialé àshazardous air pollutants CHAPs).

Specified

categories

facilities

are

subject

cettain

(MACI’)

emission

controi

requirements

they

exceed

the major source emission

threshold for

compound.

-The-proposed melter-and .slud~en

dryer az-c not in a defined source category; so no MACT or NESHAP standard applies.-

Even if

T!DTcuOIO4IQ

•

•

TECHNICAL SUPPORT DOCUMENT AND

Noh&cci SI~’dVYOiOid

•

CONSTRUCTION PERMrr APPUCATION

•

NORTH

SHORE

SANITARY

DISTRICT

WAUICEGAN,

the

proposed

equipment

were

a designated

MACT

source

category,

MACI’

would

not

applicable

since

the

potential

emit -HAl’S

v~ellbelow

thC major

source

thresholds

(10

•

ton/yearof an individual HA-P or 25

ton/year

total of

all

NAPs).

3.5

OperatIng Permit

The project will requfre a-state operating pen-nit.

The operating

permit

will not impose

any

emission oroperazing restrictions

beyond those described aboye

andcbntained in

the.state’s

au-

pollution

rules, but will specify all

monitoring, recordkeeping

and icporting obligations.

The

permit

will be

a non-Part

70 permit, incorporating thefederally-enforceable lii-nits.

According

Illinois regulations, NSPS-ap~1icabiiity

does

not automatically subject non-major

100

ton/year

of an~’

criteria pollutant emissions) sources toTitle V permitting, .so the auxiliary heater’s

Subpart

Do applicability

does

not triggerTitleY.

3.6

Odor

The

state

air regulations (Part

245)

forbid

the

release

of nuisance odors.

Several of-the project’s

emission sources have the potential

to generate offensive odors.

The plant design calls for

routing these

gas

streams

through

an odor control system prior

release.

This treatment will

reduce

odors

and emissions below levels of concern.

•

llnT.noIOHO

•

3/7/02-’

THE

C~CIJITCOURT OF LAKE COUNTY, ILLINOIS

COUNTY

DEPARTMENT,

CHANCERY DIVISION

CITY OF

WAUXEGAN,

a municipal

corporation, the Waukegan City Council, the

governing

body ofthe CITY OF WAUKEGAN,

Daniel

Drew,

Mayor of

the CITY OF

WALFKEGAN and

John Balen, Sam

Cunningham,

A. “Tony” Figueroa, Frank

Harris, Jr., Richard Hyde, Patrick R. Needham,

No.

1777

John Rickerd, and

Lawrence TenPas,

members

of the

Waulcegan City Council, Russ

Tomlin,

Judge Stephen Walter

Director of Planning and

Zoning, and Chuck

Perkey, Building and Planning Director.

PlaintiffiCounter-Defendants

THE ILLINOIS ENV~ONMENTAL

PROTECTION AGENCY

Defendant, and the

NORTH SHORE

SANITARY DISTRICT,

Defendant/Counter-Plaintiff,

VERIFIED ANSWER AND COUNTERCLAIMS

OF DEFENDANT NORTH

SHORE

SANITARY DISTRICT TO WAUKEGAN’S

AMENDED

COMPLAINT

Defendant,

The North Shore

Sanitary District

(“NSSD”),

and

through

its

attorneys,

Gardner,

Carton

Douglas,

states

its

Verified

Answer

and

Counterclaims

Plaintiffs’

Amended Complaint,

as follows:

ALLEGATIONS COMMON TO

ALL

COUNTS

The Parties

Waukegan

municipal

corporation

located,

Lake

County,

Illinois

and

Illinois

Home Rule unit

of government.

ANSWER:

NSSD admits that Waukegan

a municipal corporation

located in Lake County, Illinois.

NSSD lacks sufficient Iciowledge or information sufficient to

form

a belief as to

the truth of the

remainder of the allegations in this paragraph, and therefore

denies each and

every such

allegation.

Richard

Hyde

the

Mayor

of the

City

Waukegan

and

member

the

Waukegan

City

Council,

citizen of the

State

of Illinois

and

resident of the

City of Waulcegan

(the “Mayor”).

ANSWER:

NSSD

admits

the allegations contained in this paragraph.

John Balen,

Sam

Cunningham,

“Tony”

Figueroa,

Frank Harris, Jr.,

Patrick

R. Needham, John Rickerd, and Lawrence TenPas,

are

members of the Waukegan

City Council,

citizens

of the

State

of Illinois,

and residents

of the City of Waukegan

(the

“City Council”

and

“Alderman”,

respectively).

ANSWER:

NSSD admits the allegations contained in this

paragraph.

The Agency

an agency of the State

ofIllinois,

empowered to

consider, issue or

deny

various

applications for permits.

ANSWER:

NSSD

admits the allegations contained in this

paragraph.

NSSD

special purpose

unit of local

government

established by

North Shore

Sanitary District Act,

70 ILCS

§2305/0.1, et

ANSWER:

NSSD admits that it is a unit of government,

established by

the

North Shore Sanitary

District Act,

70 ILCS 2305/0.1, et ~g.,

the North Shore Sanitary District Extension

(1st)

Act,

ILCS 2310/0.1,

et ~g.,

and. the North Shore Sanitary District Extension (2nd) Act,

70 ICS

2315/i, et ~g.

NSSD denies the remaining allegations in this

paragraph.

Further answering,

NSSD affinnatively statas that it is charged with disposal of sewage for a population of

approximately 350,000 people, within its Facility Planning Area boundary, encompassing the

geographic

area roughly bordered by Lake Cook road

on the south,

the Illinois

and Wisconsin

border on the north,

the Tri-State Toilway in the west, and Lake Michigan in the east.

See map

ofboundary,

attached

as Exhibit

Ito this

Verified Answer and Counterclaims ofDefendant

North Shore Sanitary District

to Waukegan’s Amended Complaint.

Nature of Action

This

action

relates

the

unilateral

actions of the

NSSD

construct

new

pollution

control

facility

(the “Facility”)

the

Waukegan

lakefront,

and

haul

sewage

sludge

through

the

City of Waukegan

stored

and

burned

the new

Facility.

The NSSD

has

refused to

comply

with state and

local

laws, requiring it to

first

obtain

a land

use

decision

from

the City.

For

its

part, the Agency

has

said

it will not

require

NSSD

obtain

the

local

siting

decision

required

state

law

and

has

issued

permits

NSSD

for

the

construction

and

development of the Facility.

The City

asks

this

Court

declare

that

the Facility

subject to

specific

state

and

local

laws requiring NSSD

obtain

land use

and

building

permit

decisions

from the City.

In this

action,

the City seeks declaratory and injunctive relief.

ANSWER:

This paragraph states numerous

conclusions of law to which no answer is required.

the extent this paragraph may be interpreted to contain any factual allegation, NSSD denies that

it has acted

in a unilateral manner.

NSSD

admits that it intends to

replace its

current sludge

disposal practice with a beneficial biosolids reuse,

and has received permits

from the Illinois

Environmental Protection Agency

(“Agency”) to

construct and operate

a beneficial biosolids

drying/melting facility (the “biosolids drying/melting facility”)

at its Waukegan sewage

treatment plant.

Further answering NSSD affirmatively states that the United States

Environmental Protection Agency uses the term “biosolids” to distinguish sewage sludge which

is to be beneficially reused,

ratherthan discarded.

See Standards

for the Use or Disposal of

Sewage

Sludge,

Fed. Reg.

9248,9251

(Feb

19,

1993)(codified at 40

CFR Part 503).

Further

answering, NSSD affirmatively

states

that

in order

eliminate the current method ofsludge

discard and disposal through

landfilling,

and facilitate

this new

biosolids

reuse process, it intends

cease transporting sludge

from its

Waukegan sewage

treatment plant to

its Newport Township

Landfill.

NSSD affirmatively states

that

as part of its landfllling activities, it currently transports

five

truckloads of sludge from

its Waukegan sewage treatment plant,

five from its Gurnee plant,

and two

from its Highland Park plant on

a daily basis Monday through Friday, to

its Newport

Township Landfill.

Further answering, NSSD affirmatively states that

its new processes will

eliminate the current practice oftransporting these truckloads ofsludge from the Waukegan,

Gumee,

and Highland Park

plants to the Newport Township Landfill.

Further answering, NSSD

affirmatively states, that rather than discard sludge, it proposes to instead transport

five

truckloads ofbeneficially reusable biosolids

from the Gumee plant, and two

truckloads from

the

Highland Park plant,

to the Waukegan sewage treatment plant,

forprocessing

in the proposed

biosolids drying/melting facility, on a daily basis Monday through Friday.

NSSD afflmiatively

states that this

will result in a total net gain of two full truckloads per dayto be transported

through the City ofWaukegan.

NSSD

denies that the biosolids drying/melting facility is a

“pollution control facility” or a “new Facility” as alleged in this paragraph, or a new “Pollution

Control Facility” as defined in Section 3.32

of the Illinois

Environmental Protection Act (“the

Act”), 415

ILCS

5/3.32.

NSSD denies each and every remaining allegation as

it relates

NSSD.

the extent this paragraph may be

intended to contain any factual allegation related to

any other party, NSSD

admits-that the Agency has indicated that it deems the local

siting

provisions contained in Section

39(c) ofthe Act,

415

ILCS

5/39(c),

and Section 39.2 of the Act,

415

ILCS

5/39.2, inapplicable to NSSD’s proposed biosolids

drying/melting facility, and has

issued permits

to NSSD for the construction and development of the biosolids

drying/melting

facility.

NSSD denies each and

every remaining allegation in this paragraph.

The NSSD Processes Materials Discarded by Others

The

NSSD

operates three

wastewater treatment

plants

Lake

County,

Illinois

located

in Highland

Park, Gurnee

and

Waukegan.

These

plants receive

and

treat

variety of

wastewaters,

ranging

from

human

sewage

industrial

waste

containing

toxic

substances.

Though

the

physical

and

chemical

properties

the

wastewaters

may

vary

widely,

the

wastewaters

common

characteristic:

all

the wastewaters

have

been

discarded by

the

persons genefating them.

The wastewaters,

serving

useful

purpose

the persons

generating

them,

are transported by

various

means

the NSSD treatment

plants.

Some

wastewaters

are

delivered to

the treatment plants by sewer lines.

Other wastewaters

are

delivered to the treatment

plants

tanker trucks.

Plaintiffs

are

informed

and

believe

that

the

wastewaters

delivered

tanker trucks have been generated (i.e., discarded) by persons located outside the geographic

area

of the NSSD established by the North Shore Sanitary District Act.

ANSWER:

This paragraph states numerous conclusions oflaw

to which no

answer is required.

the extent this paragraph contains factual allegations, NSSD admits that it operates three

permitted wastewater

treatment

plants in Lake County, Illinois,

located in Highland Park,

Gurnee, and Waukegan.

NSSD

admits that these plants treat domestic sewage,

and also

receive

some industrial discharges which are from point sources subject to discharge permits

under

Section 402 of the Clean Water Act,

33 U.S.C.

1342.

Further answering, NSSD

affirmatively

states that to

the extent required, all industrial discharges have been treated through the permitted

pretreatment program prior to receipt by the NSSD plants.

NSSD admits that wastewater is

delivered

to the sewage treatment plants by sewer lines.

NSSD further admits that septic haulers

deliver septage to

the Waukegan sewage treatment plant,

and further answering, NSSD

affirmatively states that the

septic

haulers

must certif~r

that

each

septage load originated from

within the NSSD’s Facility Planning Area.

NSSD denies each and every

remaining

allegation in

this paragraph.

The NSSD does not

manufacture goods for sale

to others.

in the business

processing waste produced by others.

The NSSD processes

wastes received

from others

so they

can

easily

and safely disposed

The NSSD

subjects

wastewaters

various

forms

physical,

chemical

and biological

processes.

The purpose of these processes

to separate

solids

the

wastewater from

the water

itself,

reducing the

amount

the incoming

waste

which

will

have

disposed.

the

wastewater is

dewatered,

increasing

its

solids content,

is referred

as Sludge.

ANSWER:

NSSD admits that it is engaged in

the activities specified by the North Shore

Sanitary

District

Act,

ITLCS

2305/0.1,

NSSD further admits that

it does not currently

manufacture goods for sale to

others, but affirmatively states

that it intends

sell the glass

aggregate finished product ofits

biosolids drying/melting facility process as

a useful product,

thereby eliminating the need for

future

landfllling of sludge.

NSSD further denies each and

every remaining allegation in this paragraph.

The NSSI) Proposes To Build The Facility at

a Critical Juncture

in the History of the Waukegan Lakefront

The NSSD

treatment plant in

Waukegan

located on

Dahringer Road

along the

Lake Michigan lakefront (“NSSD Property”).

ANSWER:

NSSD

admits

the allegations contained in

this paragraph, and further answering the

NSSD affirmatively states that it has operated the Waukegan sewage treatment plant since 1928

on approximately

acres ofland owned by the NSSD.

10.

The NSSD proposes to

construct the Facility on the NSSD

Property to

store,

dry

and thermally treat Sludge.

ANSWER:

NSSD

admits that it intends to

replace. its

current

sludge method of landfilling its

discarded sludge,

with

a beneficial biosolids

reuse process, and has received permits

from the

Agency to

construct and operate a biosolids

drying/melting facility at its Waukegan sewage

treatment plant.

NSSD denies remaining allegations in this

paragraph, and specifically

denies

that the biosolids drying/melting facility is

a “Pollution Control Facility”

as defined

in Section

3.32

of the Illinois

Environmental Protection Act

(“the Act”),

415 ILCS

5/3,32.

11.

The Facility

is proposed to

located

on an

area of the NSSD Property

currently

used as a parking lot (the “Facility Boundaries”).

ANSWER:

NSSD

admits that it intends to

replace its current sludge method of landfilling its

discarded sludge, with a beneficial biosolids

reuse process, and has received permits

from the

Agency to

construct and operate

a biosolids drying/melting facility at its Waukegan sewage

treatment plant.

NSSD admits that the NSSJ

intends to, locate the biosolids drying/melting

unit

a portion ofNSSD property currently used as a parking lot.

NSSD denies

remaining

allegations in this paragraph, and specifically denies that the biosolids

drying/melting facility is a

“Pollution Control Facility” as defined in Section 3.32 of the Illinois Environmental Protection

Act

(“the Act”), 415

ILCS

5/3.32.

12.

The Sludge

has

strongly

offensive

and

obnoxious odor.

The

Sludge

would

transported

year

around

from

the

Highland

Park

and

Gurnee

sewage

treatment

plants

the

Facility

trucks.

The

trucks

carrying

Sludge

will

travel

through

Waukegan

route

the

Facility.

The Sludge will be stored in new pits

and “silos”.

In the event of a malfunction

at the

Facility,

the Sludge

may have

be re-loaded

and transported by truck back through Waukegan

alternate

disposal

facility.

The storage

and

transportation

of the

Sludge

has the potential

for

emitting

strongly

offensive

and

obnoxious

odor

Waukegan

beyond.

the

Facility

Boundaries.

ANSWER:

NSSD admits that

it intends

transport

biosolids from

its Highland Park and Gurnee

sewage treatment

plants

to its

Waukegan sewage

treatment plant

in trucks

Monday through

Friday.

NSSD denies remaining allegations in this paragraph, and specifically denies that the

biosolids

drying/melting facility is

a “Pollution

Control Facility” as defined in Section 3.32

the Illinois Environmental Protection Act

(“the Act”), 415

ILCS

5/3.32.

Further answering,

NSSD

affu-rnatively states that

is has

transported

sludge

through the boundaries ofthe NSSD

Facility Planning

Area,

including

through Waukegan,

from the

Waukegan

sewage treatment

plant,

forthe past 74 years, and

for over

years to the landfill in Newport Township.

NSSD

denies that it will store biosolids

in pits, and affirmatively states

that the biosolids

will be

contained in silos located inside a coveredbuilding, prior to

being processed for

drying and

melting.

NSSD denies that

all of the biosolids have a strong or obnoxious odor.

13.

Sludge will be

heated

and

dried prior

incineration.

The drying

process

itself

emits an offensive and obnoxious odor with the potential of escaping the Facility Boundaries.

ANSWER:

NSSD

denies the allegations in

this paragraph,

except

for as

admitted hereafter.

NSSD

denies that the potential exists

for offensive or obnoxious

odors to escape from the Waukegan

sewage

treatment plant,

as a result of operation ofthe

drying

process.

Further

answering, NSSD

affirmatively

states that the current system uses a drying or dewatering process.

The new

beneficial reuse biosolids drying/melting process will not increase,

and may serve to reduce

odor.

Further

answering, NSSD

affirmatively states that

less than 88 cfit (cubic feet per minute)

of emissionwill be vented as a result of the drying process, and those emissions will be

subject

odor control treatment,

as compared

to the average household bathroom vent, which typically

emits

100

cfin.

14.

The Sludge

will be

incinerated

combustion

chamber.

The Facility

will

emit

various

air

pollutants

into

the

atmosphere,

including

Nitrous

Oxide,

Sulfur

Dioxide,

Lead,

Beryllium,

and Mercury,

all

ofwhich

must be controlled by complex pollution control devices.

ANSWER:

NSSD admits that its biosolids

drying/melting facility will emit Nitrous

Oxide,

Sulffir

Dioxide, Lead, Beryllium,

and Mercury well below levels allowable under permitted limits.

NSSD denies remaining allegations in this

paragraph, and specifically denies that the biosolids

drying/melting facility is a “Pollution Control Facility” as defined in Section 3.32

ofthe Illinois

Environmental Protection Act (“the Act”), 415 ILCS

5/3.32.

15.

visible

plume

will rise

from

the Facility’s

stack.

The stack will

least

feet high.

ANSWER:

NSSD denies

the allegations in this paragraph, except for admitted hereafter.

SSD

admits

that

stack

will rise

feet above

a roofelevation of approximately 50

feet. NSSD denies

remaining allegations in this

paragraph, and specifically denies that the biosolids drying/melting

facility is a “Pollution Control Facility”

as defined in Section

3.32

of the Illinois Environmental

Protection Act (“the Act”),

415 ICS

5/3.32.

16.

The NSSD

intends

operate

the Facility 24

hours

a day,

days

a week

and 52

weeks a year.

ANSWER:

NSSD admits that its

permit

applications were

allow for operation of the biosolids

drying/melting facility 24 hours a day,

days a week and

weeks

a year.

NSSD denies

remaining allegations in this paragraph,

and specifically denies

that

the biosolids

dryinglmelting

facility is a “Pollution Control Facility” as defined in Section

3.32

of the Illinois Environmental

Protection Act (“the Act”), 415

ILCS 5/3.32.

17.

Upon information and belief, on or before December 22, 2000 the NSSD prepared

a “fast-track” schedule

design and construct the Facility,

which included a review of permits

necessary for the construction of the facility.

ANSWER:

NSSD

admits

that it has prepared a proposal to design

and construct

the

biosolids

drying/melting

facility, and that it reviewed the permits

which may be applicable

such a

project.

NSSD denies remaining allegations in

this

paragraph, and specifically denies that

the

biosolids

drying/melting

facility is

a “Pollution Control Facility” as defined in Section

3.32 of

the Illinois

Environmental Protection Act (“the Act”), 415

ILCS

5/3.32.

18.

On April

16,

2001

the NSSD submitted an

application to

the Agency

for a

permit

construct the Facility,

an air emission

source,

within the Facility Boundaries

Thereafter,

November

26,

2001,

the

NSSD

submitted

application

the

Agency

for

further

set

permits to

construct

and

develop the Facility,

a waste storage, waste treatment

or waste disposal

operation, within the Facility Boundaries.

On March

11, 2002,

the Agency granted Permits to the

NSSD

authorizing

the

construction

and

development

of the Facility

(the

“Agency

Permits”).

Copies of the Agency Permits are attached hereto as Exhibits A and B,

respectively.

ANSWER:

NSSD

admits

that on April

16, 2001, it submitted an Air Emission Construction

Permit

Application to

construct the biosolids drying/melting facility at its

Waukegan facility to the

Agency, and that on

November 26,

2001,

it submitted an Agency Bureau ofLand Permit

Application and

Technical Support Documents

to construct the biosolids drying/melting facility

at its Waukegan facility to

the Agency.

NSSD further admits that on March ii,

2002, the

Agency

granted Permits

the NSSD authorizing the construction

and development of the

proposed biosolids

drying/melting

facility.

NSSD denies

that the biosolids

drying/melting

facility is

a “Pollution Control Facility” as defined in Section

3.32 of the Illinois Environmental

Protection Act (“the Act”), 415

ILCS

5/3.32.

The remaining allegations

in this paragraph

contain a conclusion of law, to

which rio

answer is required.

19.

Upon

information

and

belief,

the

NSSD

has

signed

contracts

with

various

suppliers

fabricate, deliver and assemble the Facility within the Facility Boundaries.

ANS’WER:

NSSD denies the allegations contained in this

paragraph, except as admitted hereinafter.

NSSD admits that it has entered into

contracts for the construction of the biosolids

drying/melting facility.

NSSD denies that the biosolids drying/melting facility is a “Pollution

Control Facility” as defined in Section

3.32

of the Illinois Environmental Protection Act (“the

Act”), 415 ILCS

5/3.32.

20.

Upon information

and belief,

the NSSD

has accepted delivery of components

the Facility at the NSSD Property.

ANSWER:

NSSD

admits that it has accepted delivery of a limited number of components forthis

project.

NSSD denies that the biosolids drying/melting facility is

a “Pollution Control Facility”

as defined in Section

3.32 of the Illinois Environmental Protection

Act (“the Act”),

415 ILCS

5/3.32.

21.

Waukegan

has

entered

into

agreement

with

Mesirow

Stein

Development

Services,

Inc.

(“Mesirow”)

assist

the

preparation

comprehensive

plan

for

the

redevelopment of the lakefront,

including the Outboard Marine Corporation property, located on

the lakefront

to the

south of the NSSD Property.

ANSWER:

NSSD

lacks knowledge or information

sufficient to

form a belief as to the truth of the

allegations in this

paragraph, and therefore denies each and every such allegation,

and demands

strict proofthereof.

22.

Waukegan,

with

the assistance of Mesirow, has

submitted

application

the

Urban

Land

Institute

(“Till”)

requesting

that

IJLI

assist

the

City

the

development

comprehensive plan for the lakefront. On February 25, 2002, TiLl issued its recommendations for

a comprehensive lakefront development plan.

ANSWER:

NSSD

lacks knowledge or information sufficient to

form

a belief as

to the truth of the

allegations in this paragraph, and therefore denies each and every such allegation,

and demands

strict proof thereof.

23.

On November

19,

2001

the City Council

passed a

one

year moratorium

the

approval of building permits

and zoning approvals for all

development along the lakefront while

Waukegan,

Mesirow and TiLl develop

and

implement

plan for the

lakefront.

The Ordinance

adopted by the City Council

states in relevant part as follows:

The

city has determined that it is in the best interests of the citizens ofWaukegan

study the possibilities

for future development

along the city’s

lakefront

area to

determine what can harmoniously

be developed there.

ANSWER:

This paragraph states numerous conclusions oflaw to which no

answer is required.

the extent this paragraph may be interpreted to

contain any factual allegation, NSSD denies each

and every such allegation as it relates to

NSSD.

the extent that this

paragraph may be

interpreted to

contain any factual allegation related

to any other party, NSSD

lacks knowledge or

information sufficient

form a belief as

to the truth of such allegation,

and therefore denies each

and every such allegation.:

24.

The

City Council has not

determined whether the proposed Facility

compatible

with harmonious future development along the lakefront.

ANSWER:

This paragraph states

a conclusion oflaw to which no answer is required.

the extent

this paragraph may be interpreted to

contain any factual allegation, NSSD lacks knowledge or

information sufficient to form

a belief as to the truth ofsuch allegation,

and

therefore

denies

each

and every such allegation,

and demands strict proofthereof.

NSSD denies that the biosolids

dryinglmelting facility is a “Pollution

Control Facility” as defined in Section 3.32 ofthe Illinois

Environmental Protection Act

(“the Act”), 415 ILCS

5/3.32.

25.

Section

21(d)(1)

of the Illinois

Environmental

Protection

Act

(the

“Act”),

415

ILCS

§5/21(d)(1) provides, in relevant part,

as follows:

No person shall

...

conduct

any waste-storage or

waste-treatment

...

operation

without

...

a permit

granted by the Agency.

ANSWER:

NSSD

states that Section 21(d)(l) of the Act,

415

ILCS

5/21(d)(1)

speaks for itsel~and

therefore,

this paragraph requires no

answer.

Further answering, NSSD affirmatively states that

the statutory

Section cited by Plaintiff in this paragraph contains additional language

which is

relevant, and therefore, NSSD denies that Plaintiffhas accurately cited relevant portions of the

statute.

26.

Waste

is defined in

Section 3.53

of the Act

415

ILCS

§5/3.53

in relevant part as

follows:

“Waste”

means

any

...

sludge

from

waste

treatment

plant

...

air pollution

control facility or other discarded material,

including

solid,

liquid,

semi-solid,

contained

gaseous

material

resulting

from

industrial,

commercial,

mining

and

agricultural operations, and from community activities

ANSWER:

NSSD states

that Section

3.53 of the Act,

415

ILCS

5/3.53

speaks for itself,

and

therefore, this

paragraph requires no answer.

Further answering, NSSD affirmatively states

that

the statutory Section

cited by Plaintiff in this

paragraphcontains additional

language

which

relevant, and therefore, NSSD denies that Plaintiff has accurately cited relevant portions of the

statute.

27.

Sludge is

defined in Section

3.44 of the Act,

415

tLCS

§5/3.44

in relevant part

follows:

“Sludge” means

any solid,

semi-solid, or liquid waste generated from

a municipal

wastewater treatment plant

...

or air pollution control facility or any

other such

waste

having similar characteristics and effects.

ANSWER:

NSSD

states that Section

.44 ofthe Act,

415

LLCS

5/3.44 speaks for itself,

and

therefore, this

paragraph requires no answer.

Further answering, NSSD affirmatively states that

the statutory Section cited by Plaintiff in this

paragraph contains additional language which

relevant, and therefore, NSSD denies that Plaintiff has accurately cited relevant portions of the

statute.

28.

The Sludge is a waste as defined under Section

3.53

of the Act.

ANSWER:

This paragraph states a conclusion of law to

which no answer is required.

the extent

this paragraph may be interpreted to

contain any factual allegation, NSSD denies each and every

such allegation.

Further answering,

NSSD affirmatively states that the United

States

Environmental Protecticn Agency uses

the term “biosolids”

to distinguish sewage sludge

which

is to

beneficially reused, rather than discarded.

See Standards

for the Use or Disposal of

Sewage

Sludge,

Fed. Reg.

9248,9251

(Feb

19,

1993) (codified at 40 CFR Part 503).

further answer, NSSD affirmatively states that

intends to

cease discarding its sludge,

and reuse

its

biosolids in the biosolids drying/melting

process, which will beneficially reuse the sludge

NSSD produces as a by-product

from its own domestic

sewage

treatment processes, and produce

a useful

glass aggregate product.

NSSD further affirmatively states that with the exception of

mercury, all heavy metals

contained within the biosolids will be locked within the glass

aggregate useful product.

29.

Storage is

defined in Section

3.46 of the

Act, 415

ILCS

§5/3.46

in relevant part

follows:

“Storage”

means

the containment of waste,

either

a temporary

basis

for

period of years, in such a manner as not to constitute disposal.

ANSWER:

NSSD

states that

Section 3.46 ofthe Act,

415

II.~CS5/3.46 speaks for itself, and

therefore, this paragraph requires no

answer.

As further answer, NSSD affirmatively states that

as the biosolids drying/melting process will beneficially reuse the sludge NSSD produces as

by-product from its own domestic sewage treatment processes, and produce a useful glass

aggregate product, rather than discard the sludge,

and as the biosolids produced at its sewage

treatment plants are not discarded, they are not “waste,” as “waste” is defined by Section

3.53

the Act,

415

ILCS

5/3.53.

Further answering, NSSD affirmatively states that activities related to

the proposed biosolids drying/melting process do

not include waste storage.

Further answering,

NSSD affirmatively states

that the statutory Section cited by Plaintiff in this paragraph contains

additional language which is relevant, and therefore,

NSSD denies that

Plaintiff has accurately

cited relevant portions of the statute.

30.

The

Facility

proposed

the

NSSD

will

include

bins

and

silos

used

for

the

storage of Sludge,

a waste.

The Facility is

a waste storage

facility.

ANSWER:

This paragraph states numerous

conclusions of law to which no

answer is

required.

the extent this paragraph may be interpreted to contain any factual allegation, NSSD

admits that

the biosolids drying/melting facility will include silos

contained within a covered building.

NSSD further denies that it will use pits as part of the biosolids drying/melting facility, and

further denies that the facility is

a “waste storage facility”.

NSSD denies that the biosolids

drying/melting facility is

a “Pollution

Control Facility” as defined in Section

3.32 of the Illinois

Environmental Protection Act (“the Act”), 415 ILCS 5/3.3g.

NSSD affirmatively states that as

the biosohds produced at

its sewage treatment plants are not “waste,” as “waste” is defined by

Section

3,53 ofthe Act, 415 ICS

5/3.53,

activities

related to the proposed biosolids

drying/melting process do not include waste storage.

31.

Treatment

defined in

Section

3.49

of the Act,

415

ILCS

§5/3.49,

relevant

part as follows:

“Treatment”

means

any

method,

technique

or process,

including

neutralization,

designed to

change the physical, chemical,

or biological character or composition

of any waste

as to

neutralize

it or render

nonhazardous,

safer for transport,

amenable forrecovery, amenable for storage, or reduced in volume.

ANSWER:

NSSD states

that Section

3.49

the

Act,

415

ILCS

5/3.49

speaks for itself,

and

therefore, this paragraph requires no

answer. Further answering, NSSD affirmatively states that

the statutory Section cited by Plaintiff in this paragraph contains additional

language which

relevant,

and therefore.

NSSD denies

that Plaintiff has accurately cited relevant portions of the

statute.

fUrther answer, NSSD affirmatively states that

as the biosolids produced at

its

sewage treatment plants

not “waste,”

as “waste” is defined by Section

3.53

the Act, 415

ILCS

5/3.53,

activities related to

the proposedbiosolids

drying/melting process

not include

waste treatment.

32.

The Facility

will,

among other processes, dry and

oxidize

the

Sludge

and

vitrify

the metallic compounds

in the Sludge.

ANSWER:

NSSD

admits that proposed biosolids drying/melting process will

dry

and vitrify the

biosolids.

NSSD denies that the biosolids

drying/melting facility is a “Pollution Control

Facility” as defined in

Section 3.32 of the Illinois Environmental Protection Act (“the Act”),

415

ILCS

5/3.32.

33.

The Facility is a waste

treatment facility.

ANSWER:

This paragraph states

a conclusion oflaw to

which no

answer is required.

the extent

this paragraph may be

interpreted to contain a factual allegation, NSSD denies that the biosolids

drying/melting facility is

a “Pollution Control Facility” as defined in Section

3.32 of the Illinois

Environmental Protection Act (“the Act”), 415

ICS

5/3.32.

NSSD further denies that the

proposed biosolids drying/melting facility is a “waste-treatment facility.”

34;

Waukegan and the City Council have a protectible interest in ensuring that the site

location for the Facility is

approved by the City Council.

Waukegan and the City Council would

irreparably

harmed if

the Facility

were

allowed

permitted,

constnxcted

and

operated

without

proper

siting

approval.

such,

Waukegan

and

the City

Council

have

adequate

remedy at law.

ANSWER:

This paragraph states a conclusion oflaw

to which no

answer is required.

To the extent

this

paragraph may be interpreted

contain

factual allegation, NSSD denies each and every

such allegation.

NSSD denies that the biosolids drying/melting facility is

a “Pollution Control

Facility” as defined in

Section 3.32 ofthe

Illinois Environmental Protection Act (“the Act”), 415

ICS

5/3.32.

Further answering,

NSSD affirmatively states that Plaintiff has an adequate

remedy at law,

specifically,

it may bring an enforcement action before the Illinois Pollution

Control Board pursuant to Section 31(b) of the Act,

415 ICS

5/31(b).

Further answering,

NSSD denies that Plaintiffhas a protectible interest in ensuring that the site jocation for the

proposed biosolids

drying/melting facility is approved by the City Council.

COUNT I

CLAIM

FOR DECLARATORY

RELIEF

THAT

THE

FACiLITY IS A NEW

POLLUTION CONTROL FACiLITY FOR WHICHNSSD IS

REQUIRED

OBTAIN

LOCAL SITING APPROVAL

34.

Plaintiff adopt and reallege paragraphs

through

of the Allegations Common

All Counts

as paragraphs I through 34 ofthis Count I.

ANSWER:

NSSD

adopts and restates its

answers to paragraphs

1 through 34,

fUlly set

forth

herein.

35.

Pollution

Control

Facility

defined

Section

3.32

the

Act,

415

ICS

§5/3.32, in relevant part as follows:

“Pollution

control

facility”

any

waste

storage

site

...,

waste

transfer station

waste treatment facility, or waste incinerator.

ANSWER

NSSD

states that

Section

3.32 of the Act,

415

ILCS

5/3.32 speaks for itself,

and

therefore,

this paragraph requires

answer.

Further answering, NSSD affirmatively states

that

the statutory Section cited by Plaintiff in this paragraph contains additional language and which

is relevant,

and therefore,

NSSD denies that Plaintiff has accurately cited relevant portions of the

statute.

36.

The

Facility

“waste

storage

site”,

“waste

treatment

facility”

“waste

incinerator” as those terms

are used in Section 3.32 of the Act.

ANSWER:

NSSD

states that no

answer is required for this paragraph, as it calls for a legal

conclusion.

To the extent that this paragraph could be interpreted to contain factual allegations,

NSSD denies each and every such allegation.

Further answering, NSSD affinratively

states that

the Agency has determined that theproposed facility should be required to monitor Mercury

emissions pursuant to

the National Emissions

Standards for Hazardous AirPollutants

(“NESHAPS”) for Mercury.

37.

The

NSSD Property within the Facilities

Boundaries

currently

used as parking

lot.

ANSWER:

NSSD denies the allegations contained in this paragraph, but admits that a portion of the

biosolids drying/melting facility, as proposed, will be

located on a portion of the Waukegan

sewage treatment plant that

is currently used. a parking lot for the existing facility.

38.

Prior

March

Ii,

2002,

the

Agency

never

issuecL a

permit

authorizing

the

storage,

treatment orincineration ofwaste within the Facility Boundaries.

ANSWER:

NSSD denies

the allegation

contained in this paragraph, and affirmatively states that this

paragraph mischaracterizes and distorts the regulatory requirements

for wastewater treatment

plants.

NSSD affirmatively states that

at all times,

has been permitted to collect, treat

and

dispose of sewage,

regardless of whether such permits

are for “waste”.

Further answering,

NSSD states that it has obtained all necessary permits

for

its current operation as

a sewage

treatment plant,

and

that

it has received all necessary permits

for construction and development

of its proposed biosolids drying/melting

facility.

39.

Prior to

March II,

2002,

the NSSD never received a permit

from

the Agency

store, treat or incinerate waste within the Facilities Boundaries.

ANSWER:

NSSD denies the allegation contained in this paragraph, and affirmatively

states that this

paragraph mischaracterizes and distorts the regulatory requirements

for wastewater treatment

plants.

NSSD affirmatively states that at all times,

it has been permitted to

collect, treat and

dispose of sewage, regardless ofwhether such permits are for “waste”.

Further answering,

NSSD states that it has obtained all necessary permits

for its current operation as

a sewage

treatment plant,

and that it has received all necessary permits for development and construction

ofits

proposed biosolids drying/melting

facility.

40.

A New

Pollution

Control Facility

defined in

Section

3.32(b) of the Act,

415

ILCS

§5/3.32(b),

in relevant part as follows:

new

pollution

control

facility

is:

(1)

pollution

control

facility

initially

permitted

for development or

construction after July

1981;

or (2)

the

area of

expansion beyond the boundary of a currently permitted pollution control facility;

or (3)

a permitted pollution

control

facility requesting approval to

store;

dispose

of, transfer or incinerate, for the first time,

any special or hazardous waste.

ANSWER:

NSSD states that

Section 3.32(b) of the Act, 415 ICS

5/3.32(b) speaks for itself,

and

therefore, this

paragraph requires no

answer.

Further answering, NSSD affirmatively states that

the statutory Section cited by Plaintiff in this paragraph contains additional

language and which

is relevant, and therefore, NSSD

denies that Plaintiffhas accurately cited relevant portions of the

statute.

Further answering, NSSD affirmatively states that neither the Waukegan sewage

treatment plant, nor the proposed biosolids drying/melting facility is

a “new pollution control

facility” as that term is defined by Section 3.32(b) ofthe

Act, 415

ILCS

5/3.32(b).

41.

The Facility proposed within the Facility Boundaries is

a pollution

control facility

initially

permitted

for development

or construction

after July

1981,

and

therefore

new

pollution control facility.

Alternatively, the Facility proposed within the Facility Boundaries will

result in the expansion

beyond

the boundary of a

currently

permitted pollution

control facility,

and is therefore a new pollution control facility.

Additionally, the Facility does not

fit within any

of the exceptions

articulated in the definition of a pollution

control facility

in Section

3.32

of the

Act,

415

ICS

§5/3,32.

ANSWER:

This

paragraph states numerous conclusions of law to which no answer is required.

the extent this paragraph may

interpreted to

contain factual allegations, NSSD denies each

and every such allegation.

NSSD denies that the biosolids

drying/melting facility is a “Pollution

Control Facility” as defined in Section

3.32

of the Illinois Environmental Protection Act (“the

Act”), 415

ILCS

5/3.32.

Further answering, NSSD affirmatively states that neither the

Waukegan sewage treatment plant, nor the proposed biosolids drying/melting

facility is a “new

pollution control facility”

as that term is defined by Section 3.32(b) of the Act, 415

ILCS

5/3.32(b),

and denies that the proposed biosolids drying/melting

facility will be

constructed

beyond the boundary of a permitted pollution control facility, or that the existing permitted

facility will be expanded beyond its current boundary.

NSSD affirmatively states that at all

times,

it has been permitted to

collect, treat and dispose ofsewage, regardless of whether such

permits

are for “waste”.

42.

Section

39.2

of the Act, 415

ILCS

§5/39.2

provides

that the governing body of the

municipality is

to consider specific criteria in reviewing an

application for a local siting approval

for

new

pollution

control

facility.

For

example,

the

Facility

a new

pollution

control

facility,

the

City

Council

would

determine

whether

the

proposed

Facility

compatible

with

harmonious

fi.iture

development

along

the

lakefront.

Specifically,

section

39.2(a)

of the

Act

provides, in relevant part,

as follows:

The county board of the county or the governing body of the municipality,

determined by paragraph (c)

of Section

39 of this

Act

415

ILCS

5/39J,

shall

approve or disapprove the request for local

siting approval

for each pollution

control

facility which

subject to

such review. An applicant for local

siting

approval

shall

submit

sufficient

details

describing

the

proposed

facility

demonstrate compliance, and

local siting approval shall be granted only

if the

proposed facility meets the following criteria:

the facility

necessary

accommodate

the waste needs

of the area

it. is

intended to

serve;

the facility

designed,

located

and

proposed

operated

that

the

public health,

safety and welfare will

be protected;

the facility

located so

as to

minimize

incompatibility with the character

of the

surrounding

area

and

minimize

the

effect

the value

of the

surrounding property;

(A)

for a

facility other than a

sanitary landfill or waste

disposal site,

the

facility

located

outside the boundary of the

100

year

flood

plain or the

site

flood-proofed; (B) for a

facility that

sanitary landfill or waste

disposal

site,

the facility

located

outside the boundary of the

100-year

floodplain,

if’ the facility

facility

described

subsection

(b)(3) of

Section 22,l9a

415

IT_CS

5122.19a),

the site is flood-proofed;

the plan of operations for the facility is

designed to minimize

the

danger to

the surrounding area from fire, spills,

or other operational accidents;

the traffic

patterns

to or from the facility are

designed

minimize

the impact on existing traffic flows;

the facility will be

treating,

storing

or disposing of hazardous waste,

emergency response plan exists

for the facility which includes notification,

containment and evacuation procedures

be used in case of an accidental

release;

if the facility

located

county

where

the

county

board

has

adopted

solid

waste

management

plan

consistent

with

the

planning

requirements

of the

Local

Solid

Waste

Disposal

Act

the

Solid

Waste

Planning

and

Recycling

Act

415

ILCS

10/1

seq.

or 415

ILCS

15/1

seq.,

the facility is consistent with

that plan;

and

the

facility

will

located

within

regulated

recharge

area,

any

applicable

requirements

specified by

the Board

for such

areas

have been

met.

The county board or the governing body ofthe municipality may also

consider

evidence

the previous

operating

experience

and

past

record of

convictions

admissions

violations

the

applicant

(and

any

subsidiary

or parent corporation)

the

field of solid

waste

management

when considering criteria

(ii)

and (v) under this

Section.

ANSWER:

NSSD states

that Section

39.2 ofthe Act,

415

IT_CS

5/39.2 speaks

for itself,

and

therefore, this paragraph requires no answer.

NSSD further states that this paragraph states

numerous conclusions of law to which no answer is required.

NSSD denies that the proposed

biosolids drying/melting

facility is a “Waste Incinerator.”

NSSD denies

that the biosolids

drying/melting facility is

a “Pollution Control Facility” as defined in

Section 3.32

ofthe illinois

Environmental Protection Act (“the Act”),

415 ICS

5/3.32.

Further answering, NSSD

affirmatively states

that neither the Waukegan sewage treatment plant, nor the proposed

biosolids

drying1melting facility is a “new pollution

control facility” as

that term is defined by

Section 3.32(b)

of the Act,

415

IT_CS

5/3.32(b), and denies that

the proposed biosolids

drying/melting facility will be constructed beyond the boundary of a permitted pollution

control

facility, and therefore,

Section 39.2 of the Act,

415

ILCS

5/39.2 is inapplicable to

the proposed

biosolids drying/melting

facility.

43.

reviewing

the

NSSD’s

application

for permits

construct

and

develop

the

Facility,

the

Agency has

authority to

consider,

and, upon

information

and belief,

the

Agency

has adopteda policy not to consider, whether “the

facility is necessary to accommodate the waste

needs

the

area

intended

serve”,

whether

“the

facility

located

minimize

incompatibility with the character of the surrounding area and to minimize the effect

on the value

the

surrounding

property”

whether

“the

traffic

patterns

from

the

facility

are

designed

minimize

the impact on existing

traffic

flows”,

See Sections

39.2(a)

(i),

(iii)

and.

(vi)

of the Act,

respectively.

The Agency

is without

authority

base

decision regarding the

issuance

of a

permit

the NSSD

construct

or operate

air

emission source,

solid

waste

treatment operation

or ~ohd waste

storage

operation

the Agency’s

determination of whether

the

proposed

Facility

compatible

with

harmonious

ftiture

development

along

the

lakefront.

The Agency is

a pollution control, not a site location approval body.

ANSWER:

NSSD states that Section

39.2

of the Act, 415

ILCS

5/39.2

speaks for itself,

that the

Agency is empowered with the authorities

set forth in the Act, 415

ILCS

5/i

and

therefore, this

paragraph requires no answer.

NSSD further states that this paragraph states

numerous conclusions oflaw to which no answer is required.

NSSD denies that the proposed

biosohds drying/melting

facility will be constructed beyond the boundary of a permitted

pollution control facility, and denies that the proposed biosolids drying/melting facility is a

“Waste Incinerator.”

NSSD denies that the biosolids drying’melting facility is a “Pollution

Control Facility” as

defined in

Section 3.32 of the Illinois

Environmental Protection Act (“the

Act”),

415

ILCS

5/3.32.

Further answering, NSSD affirmatively

states that neither the

Waukegan

sewage treatment plant,

nor the proposed biosolids drying/melting facility is a “new

pollution control facility” as that term is defined by Section 3.32(b) ofthe Act,

415 ILCS

5/3.32(b), and denies that the proposed biosolids drying/melting facility will be constructed

beyond the boundary ofa permittedpollution

control facility, and therefore,

Section

39.2 of the

Act, 415 ILCS

5/39.2 is inapplicable to

the proposed biosolids drying/melting facility.

Further

answering, NSSD

states that

the Agency is empowered with those duties

included in the Act,

and

relevant regulations.

44~

Section 39.2 of Act establishes specific requirements for public notice,

and actual

notice

adjacent

property

owners,

the

fact

that

request

for

siting

approval

has

been

submitted to the governing body of a municipality.

The notice must describe the right ofpersons

comment on

a request for siting approval.

Specifically,

section 3 9.2(b)

of the Act provides in

relevant part as follows:

24-

later

than

days prior

request

for location approval

the

applicant

shall

cause

written notice of such

request

to be

served

either

person or by

registered

mail, return receipt requested, on the

owners of all

property within

the

subject

area not

solely

owned by

the

applicant,

and

the owners

all

property

within

250

feet

each

direction

the

lot

line

the

subject

property,

said

owners

being

such

persons

or entities

which

appear

from

the

authentic

tax

records

of the

County

which

such

facility

located;

provided,

that

the

number

of all

feet

occupied

all

public

roads,

streets,

alleys

and

other

public

ways

shall

excluded

computing

the

250

feet

requirement;

provided further,

that

in no

event shall

this

requirement exceed

400

feet, including

public streets,

alleys and other public ways.

Such

written

notice

shall

also

served

upon

members

the

General

Assembly

from the legislative district in which the proposed facility is

located

and

shall

published

a newspaper of general

circulation

published in

the

county in which the site is located.

Such

notice

shall state the name and

address of the applicant,

the location of

the proposed

site, the nature

and

size

of the development,

the nature of the

activity proposed, the probable life ofthe proposed activity,

the date when the

request for site approval will

submitted,

and

description of the

right of

persons

to comment on such request as hereafterprovided.

ANSWER:

NSSD states that Section 39.2 ofthe Act, 415

ILCS

5/39.2

speaks for itself, and

therefore, this paragraph requires

answer.

NSSD further states that

this paragraph states

numerous conclusions oflaw to

which no answer is required.

NSSD denies that the proposed

biosolids drying/melting facility will be constructed beyond the boundary of a permitted

pollution control facility, and denies that the proposed biosolids

drying/melting facility

is a

“Waste

Incinerator.”

NSSD denies that

the biosolids

drying/melting facility is a “Pollution

Control Facility” as defined in Section

3.32 of the illinois

Environmental Protection Act

(“the

Act”),

415

ICS

5/3.32.

Further

answering, NSSD affirmatively states that neither the

Waukegan sewage

treatment plant, nor the proposed biosolids drying/melting facility is a “new

pollution control facility”

as that term is defined by Section 3.32(b)

of the Act, 415

ICS

5/3.32(b), and

denies that the proposed biosolids drying/melting facility will be constructed.

beyond the boundary of a permitted pollution control facility, and therefore,

Section 39.2

of the

Act,

415

ILCS

5/39.2

is inapplicable to

the proposed biosolids drying/melting

facility.

45.

In addition to

the notice

required by Section

39.2(b) of the Act,

Section 39.2(c) of

Act

requires

that

notice

given

the

general

public,

and

others,

the

opportunity

participate

public

hearing

conducted

the

governing

body

the

municipality.

Specifically,

section 39.2(c) of the Act provides

in relevant part as follows:

applicant

shall

file

copy

its

request

with

the

county

board

of the

county or the governing body of the municipality in which the proposed site

located. The request shall include

(i)

the substance of the

applicant’s

proposal

and

(ii)

all

documents,

any,

submitted

that

date

the

Agency

pertaining

the

proposed

facility,

except

trade

secrets

determined under

Section

7.1

this

Act

415

ILCS

5/7.1.

All

such

documents

other

materials on

file with the county board or governing body

of the municipality

shall

be made available

for public

inspection

at the office of the county

board

or the governing

body

of the municipality

and may be

copied upon

payment

of the actual cost of reproduction.

Any

person

may

file

written

comment with

the

county

board

governing

body

of the municipality concerning

the appropriateness

of the proposed site

for

its

intended

purpose.

The

county

board

governing

body

the

municipality

shall

consider

any

comment

received

postmarked

not

later

than 30

days after the date of the last public hearing.

ANSWER:

NSSD

states that Section

39.2 ofthe Act, 415

ILCS

5/39.2 speaks for itself,

and

therefore, this paragraph requires no answer.

NSSD further states that this paragraph states

numerous conclusions of law to which no

answer is required.

NSSD denies that theproposed

biosolids drying/melting facility will be constructed beyond the boundary of a permitted

pollution control facility, and denies that the proposed biosoids drying/melting facility is

“Waste Incinerator.”

NSSD denies that the biosolids drying/melting

facility is a “Pollution

Control Facility” as defined in Section 3.32 of the illinois Environmental Protection Act (“the

Act”),

415

ILCS

5/3.32.

Further answering, NSSD

affirmatively states

that neither the

Waukegan sewage treatment plant, nor the proposed biosolids drying/melting facility is a “new

pollution control facility” as that temi

is definedby

Section 3.32(b) of the

Act,

415

ILCS

5/3.32(b),

and denies

that

the proposed biosolids drying/melting facility will be constructed

beyond the boundary of a permitted pollution control facility, and therefore,

Section 39.2 of the

Act,

415 ILCS

5/39.2

is inapplicable to the proposed biosolids drying/melting facility.

46.

Section 39.2(d) of the Act requires the governing body ofthe municipality

to hold

at least one public

hearing on the request

for local

siting approval.

Specifically,

Section

39.2(d)

of the Act provides in relevant part

as follows:

least

one

public

hearing

held

the

county

board

or governing

body of the municipality

sooner than

days

but

later

than

120

days

from

receipt

of the request for

site approval.

later

than

days

prior

such hearing notice

shall be

published

newspaper of general

circulation

published in the county of the proposed site, and delivered by certified mail to

all

members of the General Assembly

from the

district in

which

the proposed

site

located,

the governing authority of every municipality contiguous

the proposed site or contiguous

the municipality

in which the proposed site

is to

located, to the county board ofthe county where the proposed site is to

located,

the

proposed

site

located

within

the

boundaries

municipality,

and to

the Agency. Members

or representatives of the governing

authority

of a municipality

contiguous

the

proposed site

contiguous

the

municipality

which

the

proposed

site

located

and,

the

proposed site

located

a municipality,

members or representatives

of the

county

board

county

which

the

proposed

site

located

may

appear

and participate in

public hearings held pursuant to

this

Section.

The

public

hearing shall

develop a record sufficient to

form the basis of appeal of

the

decision in

accordance

with

Section

40.1

of this

Act

415

ILCS

5/40.1.

The

fact

that

member

the

county

board

governing

body

the

municipality has

publicly expressed

opinion

issue related

site

review

proceeding

shall

not

preclude

the

member

from

taking

part

the

proceeding and voting on the issue.

ANSWER:

NSSD

states that Section 39.2

of the Act, 415

ILCS

5/39.2

speaks for itself,

and

therefore, this paragraph requires no answer.

NSSD further states that this paragraph states

numerous conclusions of law to which no

answer is required.

NSSD denies that the proposed

biosolids drying/melting facility will be constructed beyond the boundary of a permitted

pollution

control facility, and denies

that the proposed biosolids

drying/meltingfacility

“Waste Incinerator.”

NSSD denies

that the biosolids drying/melting facility is

a “Pollution

Control Facility” as defined in Section 3.32 of the Illinois

Environmental Protection Act (“the

Act”),

415

ILCS

5/3.32.

Further answering, NSSD affirmatively states

that neither the

Waukegan sewage treatment plant, nor the proposed biosolids drying/melting

facility is

a “new

pollution control facility” as that term is defined by Section

3.32(b) of the Act,

415

ILCS

5/3.32(b),

and denies

that the proposedbiosolids drying/melting facility will be

constructed

beyond the boundary of a permitted pollution control facility, and therefore,

Section

39.2

ofthe

Act,

415 ILCS

5/39.2 is inapplicable to the proposed biosolids drying/melting

facility.

47.

Section

39.2(e)

provides

that the governing body of the municipality may impose

conditions

upon

its

approval of a

request

for siting

approval.

Those

conditions

may

address

matters

not

provided

for

the

State’s.

pollution

control

regulations,

long

they

are

reasonable and necessary,

and not

inconsistent with the State’s regulations.

way of example

only, these conditions may address traffic

impact and landscaping.

ANSWER:

NSSD

states that Section 39.2 of the Act, 415

ILCS

5/39.2 speai.cs for itself, and

therefore,

this paragraph requires no answer.

NSSD further states that this

paragraph states

numerous conclusions of law to which no answer is required.

NSSD denies that the proposed

biosolids drying/melting facility will be constructed beyond the boundary ofa permitted

pollution control facility, and denies that the proposed biosolids drying/melting facility is a

“Waste Incinerator.”

NSSD denies

that the biosolids drying/melting facility is a “Pollution

Control Facility” as defined in Section 3.32 ofthe Illinois Environmental Protection Act (“the

Act”),

415 ICS

5/3.32.

Further answering, NSSD

affirmatively states that neither the

Waukegan sewage treatment plant,

nor the proposedbiosolids drying/melting facility is

a “new

pollution control facility” as that term is defined by Section 3.32(b) ofthe Act,

415

LCS

5/3.32(b), and denies

that the proposed biosolids drying/melting facility will be

constructed

beyond the boundary of a permitted pollution

control facility, and therefore,

Section 39.2 of the

Act, 415

ILCS

5/39.2

inapplicable

to the proposedbiosolids

drying/melting facility.

48.

Specifically,

section 39.2(e) of the Act provides in

relevant part as

follows:

Decisions of the county board or governing body of the municipality are

to be

writing,

specifying

the

reasons

for

the

decision,

such

reasons

conformance

with

subsection

(a)

of this

Section.

granting approval

for

site the county board or governing body of the municipality

may impose such

conditions

as may be reasonable

and

necessary to

accomplish the purposes of

this

Section

and

as are

not

inconsistent

with

regulations

promulgated

the

Board.

Such

decision shall be

available

for public

inspection

at the office of

the

county board

or governing body

of the municipality

and

may be

copied

upon payment of the

actual

cost of reproduction. If there

is no

final action by

the county board or governing body of the municipality within

180

days after

the

filing of the request for site approval the applicant may deem the request

approved (emphasis added).

ANSWER:

NSSD

states that Section 39.2 of the Act, 415

JLCS

5/39.2

speaks for itself,

and

therefore, this paragraph requires no

answer.

NSSD

further states that this paragraph states

numerous

conclusions of law to which no

answer is required.

NSSD denies that the proposed

biosolids drying/melting facility will be constructed beyond the boundary of a permitted

pollution control facility, and denies that the proposed biosolids drying/melting facility is a

“Waste Incinerator.”

NSSD denies

that the biosolids drying/melting facility is a “Pollution

Control Facility” as defined in Section 3.32 of the Illinois Environmental Protection Act (“the

Act”), 415 ILCS

5/3.32.

Further answering, NSSD affirmatively states that neither

the

Waukegan sewage treatment plant, nor the proposedbiosolids drying/melting facility is

a “new

pollution control facility” as that term is defined by

Section 3.32(b) of the Act, 415 ICS

5/3.32(b), and denies that the proposedbiosolids

drying/melting facility will be constructed

beyond the boundary of a permitted pollution control facility, and therefore,

Section 39.2 of the

Act,

415

ILCS

5/39.2

is inapplicable to

the proposed biosohds drying/melting facility.

49.

Section

39.2(g)

of the

Act,

415

ICS

§S/39.2(g),

provides

relevant

part

follows:

The siting approval procedures, criteria and appeal procedures provided for in

this

Act

for new

pollution

control

facilities

shall be

the

exclusive

siting

procedures

and

rules

and

appeal

procedures for

facilities

subject

such

procedures.

Local

zoning or other

local

land use requirements

shall

not be

applicable

to such siting

decisions.

ANSWER:

NSSD

states that Section

39.2

of the Act, 415 ICS

5/39.2 speaks for itself,

and

therefore,

this paragraph requires no

answer.

NSSD

further states that

this paragraph states

numerous

conclusions of law to which no

answer is required.

NSSD denies that the proposed

biosolids

drying/melting facility will be constructed beyond the boundary of a permitted

pollution control facility,

and denies that the proposed biosolids drying/melting

facility is a

“Waste Incinerator.”

NSSD denies that the biosolids

drying/melting facility is a “Pollution

Control

Facility” as defined in Section 3.32 of the Illinois Environmental Protection Act

(“the

Act”), 415 ICS

5/3.32.

Further answering, NSSD af±innatively

states that neither the

Waukegan

sewage treatment plant,

northe proposedbiosolids

drying/melting

facility is a “new

pollution control facility” as that term is defined by Section 3.32(b) of the Act, 415

ILCS

5/3.32(b), and denies that the proposed biosolids drying/melting facility will be constructed

beyond the boundary of aperrnitted pollution control facility, and therefore,

Section 39.2 ofthe

Act, 415

ILCS

5/39.2 is inapplicable to. the proposed biosolids drying/melting facility.

50.

The City Council

is the governing body ofWaukegan.

Al”

SWElt

NSSD admits the allegations contained in this

paragraph.

51.

The NSSD has not

filed

a request for siting approval for the

Facility with the City

Council.

The City Council has not

issued

a siting approval for the Facility.

ANSWER:

NSSD

admits that it has not submitted a request for siting approval for its proposed

biosolids

drying/melting

facility, and that the Waukegan City Council has not issued siting

approval for such unit.

Further

answering, NSSD affirmatively states

that this is

consistent with

past practice with respect to the relationship between the NSSD

and the City of Waukegan,

since

1941,

in that the City ofWaukegan has not previously sought to require siting approval for

activities ofthe NSSD.

NSSD denies that

it proposes to

construct a “Waste Incinerator.”

NSSD

denies that the biosolids drying/melting facility is a “Pollution Control Facility” as defined

Section 3.32 of the Illinois Environmental Protection Act (“the Act”),

415 ICS

5/3.32.

Further

answering, NSSD affirmatively states that neither the Waukegan sewage treatment plant, nor the

proposed biosolids drying/melting

facility is a “new pollution control facility” as that term is

defined by Section 3.32(b) ofthe Act, 415 ILCS

5/3.32(b),

and denies that the proposed

biosolids drying/melting facility will be constructed beyond the boundary of a permitted

pollution control facility, and therefore,

Section

39.2 of the Act, 415

ILCS

5/39.2

is inapplicable

to the proposed biosolids drying/melting facility.

52.

Section

39(c)

of the

Act,

415

ILCS

§5/3.39(c),

provides

relevant

part

follows:

permit

for

the

development

construction

new

pollution

control

facility may

granted by

the Agency

unless

the applicant submits

proof to

the

Agency that the location of the facility has been approved by the County

Board of

the county if in an unincorporated area, or the governing body of the municipality

when

incorporated

area,

which the facility

located

accordance

with Section 39.2

of this Act.

ANSWER:

NSSD

states that

Section 39.2 of the Act,

415

ICS

5/39.2

speaks for itself,

and

therefore,

this

paragraph requires

answer.

NSSD denies that the proposed biosolids

drying/melting facilitywill be constructed beyond the boundary of a permitted pollution control

facility, and denies that the proposed

biosolids

drying/melting facility

is a “Waste Incinerator.”

NSSD denies that the biosolids drying/melting facility

a “Pollution Control Facility” as

defined in Section 3.32 of the Illinois Environmental Protection Act

(“the Act”),

415 ICS

5/3.32.

Further answering, NS&D affirmatively states that neither the Waukegan sewage

treatment plant, nor the proposed biosolids drying/melting facility is a “new pollution control

facility” as that tent

is defined by Section 3.32(b) of the Act, 415

ILCS

5/3.32(b), and denies

that the proposed biosdids drying/melting facilitywill

be constructed beyond the boundary of a

permitted pollution control facility, and

therefore, Section

39.2

ofthe Act, 415

ILCS

5/39.2 is

inapplicable to

the proposed biosolids

drying/melting facility.

53.

The

NSSD

has

not

submitted

proof

the

Agency

that

the

City

Council

has

issued,

accordance

with

Section

39.2

the

Act,

local

siting

approval

for

the

Facility

Boundaries

or the Facility (“Local Siting Approval”).

ANSWER:

NSSD admits

that it has not submitted local siting

approval under to Section 39.2 of the

Act,

4.15

ILCS

5/39.2.

NSSD

denies

that the proposed

biosolids dzying/melting facility

Will

constructed beyond the boundary of a permittedpollution control facility, and denies that the

32.

proposed biosolids

drying’melting facility is

a “Waste Incinerator.”

NSSD denies

that the

biosolids drying/melting facility is

a “Pollution Control Facility” as defined in Section

3.32 of

the Illinois Environmental Protection Act

(“the Act”), 415

ILCS

5/3.32.

Further answering,

NSSD

affirmatively states

that neither the Waukegan sewage

treatment plant,

nor the proposed

biosolids

drying/melting

facility is a “new pollution control

facility” as that term

defined by

Section 3.32(b)

of the Act, 415

ILCS

5/3.32(b),

and denies

that the proposed biosolids

drying/melting facility will be

constructed beyond the boundary ofa permitted pollution control

facility, and therefore,

Section 39.2 of the

Act,

415 ILCS

5/39.2

is inapplicable to

the proposed

biosohds

drying/melting

facility, and further denies that it intends to construct a Waste

Incinerator.

54.

The NSSD’s

failure

obtain

and provide valid proof of a Local Siting

Approval

in accordance with

Section 39.2

of the Act renders the Agency Permits void.

ANSWER:

NSSD

states that this paragraph contains a legal conclusion which requires no response.

NSSD

denies that the proposed biosolids drying/melting

facility will be

constructed beyond the

boundary of a permitted pollution control facility, and denies that the proposed biosolids

drying/melting facility is

a “Waste

Incinerator.”

NSSD denies that the biosolids drying/melting

facility is a “Pollution

Control Facility” as defined in Section 3.32 of the Illinois Environmental

Protection Act (“the Act”), 415

ILCS 5/3.32.

Further answering, NSSD

affirmatively states that

neither the Waukegan

sewage

treatment plant, nor the proposed biosolids drying/melting facility

is a”new pollution control facility” as that term is definedby Section 3.32(b) ofthe Act, 415

ILCS

5/3.32(b),

and denies that the proposed biosolids

drying/melting facility will be constructed

beyond the boundary of a permitted pollution control

facility, and therefore,

Section 39.2 of the

Act, 415

ILCS

5/39.2

inapplicable to

the proposed biosolids

dryinglmelting facility, and

fiarther denies

that failure to

obtain siting approval from the City of Waukegan renders the

lawfiully issued Agency Permits void.

55.

The

Agency’s

issuance

of the Agency

Permits

contravenes

Section

39(c)

of the

Act,

which

prohibits

the

Agency

from

granting

permit

for

new

pollution

control

facility

absent proof of a

local siting appmoval.

The Agency thus

lacked jurisdiction to

grant the Agency

Permits.

ANSWER:

NSSD denies each and every allegation contained in this paragraph. Further

answering,

NSSD affirmatively states that neither the Waukegan sewage treatment plant, nor the proposed

biosolids drying/melting

facility is a “new pollution

control facility” as that term is defined by

Section 3.32(b) of the Act,

415

ILCS

513.32(b),

and denies that the proposed biosolids

dryinglmelting facility will be constructed beyond the boundary of a permitted pollution control

facility, and therefore, Section 39.2 of the

Act, 415

U.SCS

5/39.2 is inapplicable to the proposed

biosolids

drying/melting facility,

and further denies that it intends

to construct a Waste

Incinerator.

NSSD denies that the biosolids

drying/melting facility is a “Pollution Control

Facility” as defined in Section 3.32 of the Illinois Environmental Protection Act (“the Act”), 415

ICS

5/3.32.

56.

actual

controversy

exists

between the

parties

whether the Facility

new

pollution control facility requiring Local Siting Approval.

ANSWER:

This paragraph states a conclusion of law to

which no answer

is required.

the extent

this

paragraph may be interpreted to contain

factual allegation, NSSD denies each and every

such allegation, including the allegation that the proposed biosolids drying/melting facility is a

“new pollution control facility” as that term is defined by Section

3.32(b) of the Act, 415 ICS

5/3,32(b).

Further answering, NSSD affirmatively states that Plaintiff has an adequate remedy at

law,

specifically,

may bring

an enforcement action before the

Illinois Pollution Control Board

pursuant to

Section

3 1(b) of the

Act, 415 ILCS

5/31(b).

COUNT

CLAIM FOR INJUNCTION PRECLUDING THE NSSD FROM CONSTRUCTING OR

OPERATING THE

FACILITY WITHOUT LOCAL SITING

APPROVAL

55.

Plaintiffs

adopt

and reallege paragraphs

through

of Count

paragraphs

through 55

of this

Count II.

ANSWER:

NSSD

adopts and restates its

answers to paragraphs

through

55,

as is fully set forth

herein.

56.

Waukegan and the City Council have a protectible interest in ensuring that the

site

location for the Facility is

approved by the City Council.

Waukegan and the

City Council would

irreparably harmed if

the

Facility

were

allowed

permitted,

constructed

and

operated

without

proper

siting

approval.

such,

Waukegan

and

the

City

Council

have

adequate

remedy at law.

ANSWER:

This paragraph states a conclusion of law to which

answer is

required.

the extent

this paragraph may

be interpreted to

contain

a factual allegation, NSSD denies each

and

every

such allegation.

Further answering, NSSD affirmatively

states that Plaintiff has an adequate

remedy at law,

specifically, it may bring an enforcement action before the Illinois

Pollution

Control Board pursuant to

Section 31(b) of the Act, 415

ILCS 5/31(b).

Further answering,

NSSD denies that Plaintiff has a protectible

interest in ensuring that

the site location for the

proposed biosolids

dryinglmelting facility is approved by the City Council.

COUNT III

CLAIM

FOR DECLARATORY RELIEF THAT

NSSD

IS REQUIRED

COMPLY

WITH THE

WAUKEGAN ZONING ORDINANCE

55.

Plaintiffs

adopt

and reallege

paragraphs I

through

of Count

I as paragraphs

through

of this Count III.

ANSWER:

NSSD

adopts

and restates its answers to paragraphs

through

55,

fully set forth

herein.

56.

Inthe alternative, if the Facility does not meet the definition of a pollution control

facility under

Section

3.32

of the

Act

or is

otherwise exempt

from

the requirement of obtaining

Local Siting Approval, the City retains its

authority to regulate

the siting of the Facility under the

Waukegan

Zoning

Ordinance

(the

“Zoning

Ordinance”),

pursuant

the

sixth

paragraph

Section 39(c) ofthe Act.

ANSWER:

This paragraph states a conclusion of law to which rio answer is

required.

Further

answering, NSSD denies the legal conclusions contained in this

paragraph.

To the extent this

paragraph may be interpretedto

contain factual allegations, NSSD denies each and every such

allegation.

NSSD

denies

that the biosolids drying/melting facility is

a “Pollution Control

Facility” as defined in Section 3.32

ofthe illinois Environmental Protection

Act (“the Act”),

415

ILCS

5/3.32.

Further answering, NSSD affirmatively states that neither the Waukegan sewage

treatment plant, nor the proposed biosolids drying/melting facility

is a “new pollution

control

facility”

as that term is defined by Section 3.32(b) of the Act, 415

ILCS

5/3.32(b).

57.

The NSSD Property

located

1-2

District,

such District

established

under Article 10 of the Zoning Ordinance.

ANSWERZ

This paragraph states

a conclusion oflaw to

which no answer is required.

To the extent

this paragraph may be interpreted to

contain

a factual allegation, NSSD admits

the allegation.

58.

A waste

storage operation,

waste

treatment

operation

and

waste

incinerator are

not permitted uses

under

§10.4-3, Permitted Uses,

General Industrial

District,

of the

Zoning

Ordinance.

ANSWER:

This paragraph states a conclusion of law to which rio

answer is required.

Further

answering, NSSD affirmatively states that the operation of the proposed biosolids

drying/melting

facility will not constitute waste storage or treatment operation

or waste incineration.

Further

answering,

NSSD affirmatively states that under Section 6.3.2 ofthe Zoning Ordinance, essential

services such as disposal systems are

exempt from zoning.

59.

Section 10.4-4(26), Conditional Uses,

General Industrial District, ofthe Zoning

Ordinance provides

in relevant part as follows:

The following conditional

uses may

allowed

the

District,

subject to

the

provisions ofSection 3.11:

Other

manufacturing,

processing,

storage,

commercial uses

determined by

the

Zoning Administrator to be of the same general

character as the use permitted in

Section

10.4-3,

above,

and

found not

obnoxious, unhealthful,

or offensive by

reason of the potential emission or transmission of noise,

vibration,

smoke,

dust,

odors,

toxic or noxious matter or glare or heat.

ANSWER:

NSSD

states

that the ordinance

cited in

this paragraph speaks for itself,

and therefore,

this

paragraph requires

no answer.

Further answering, NSSD

affirmatively

states that the operation

of the proposed biosolids

drying/melting facility will not

constitute waste storage or treatment

operation

or waste incineration.

60.

A waste

storage and waste treatment operation

Conditional Use under

§10.4-

4(26), Conditional Uses,

12 General Industrial District, of the Zoning Ordinance.

ANSWER:

This

paragraph states a conclusion oflaw to which no

answer is

required.

Further

answering, NSSD affirmatively states

that the operation of the proposed biosolids

drying/melting

facilitywill not constitute waste storage, ortreatment or waste incineration.

61.

April

12,.

2002,

NSSD

submitted

what

claimed

Applications

for

Conditional Use Permit

and

Zoning Variance

with

Waukegan’s Department

of Planning

and

Zoning.

A copy of this

submittal

attached hereto

as Exhibit

Thereafter, on

April

17,

2002,

NSSD

submitted an amendment or supplement to the

above submittal. A

copy ofthis subsequent

submittal is

attached hereto

as Exhibit D.

These

submittals were

tendered under

a reservation of

rights, with the NSSD

taking the position that Waukegan has no jurisdiction to

impose zoning or

building permit requirements or fees

on the NSSD. Waukegan has not issued zoning approval for

the construction

and

operation of the NSSD Facility

the NSSD Property

within the Facility

Boundaries.

ANSWER:

NSSD

admits that it filed an application for zoning approval and building permits with

the City of Waukegan on March

12, 2002.

NSSD admits that it also filed a separate Conditional

Use Permit and Variance

application with the City of Waukegan on

April

12,

as well as a

supplement to those applications on April

17~2002.

Further answering, NSSD

states that

Exhibits C and D

to Plaintiffs

Amended Complaint, which NSSD admits

are true

and accurate

copies ofNSSD’s April

12th,

2002,

and April

17th

2002 submissions to

the

City ofWaukegan,

speak for themselves.

NSSD

admits that the City of Waukegan has to date failed to render

decision on those

submittals.

COUNT

CLAIM

FOR INJIJNCTION PRECLUDING THE

NSSD

FROM CONSTRUCTING THE

FACILITY ABSENT COMPLIANCE WITH

THE

WAUK.EGAN

ZONING

ORDINANCE

61.

Plaintiffs

adopt and

reallege paragraphs

through

of Count

as paragraphs

through 61

ofthis

Count

IV.

ANSWER:

NSSD

adopts

and restates its answers to

paragraphs

through

61,

as is

filly set

forth

herein.

62.

Waukegan

and

the

City

Council

have a

protectible

interest

ensuring

that

the

Waukegan Zoning Ordinance

complied with

and the site location for the Facility is

approved

by the

City Council.

Waukegan and the City Council would

be irreparably harmed if the Facility

were

allowed

permitted,

constructed

and

operated

without proper

zoning

approval.

such, Waukegan and the City Council have no

adequate remedy at law.

ANSWER:

This paragraph states a conclusion of law to which no answer is required, but is in any

event denied by NSSD.

To the extent this paragraph may be

interpreted to contain a factual

allegation, NSSD denies each and every such allegation.

Further answering, NSSD

affirmatively

states that Plaintiffhas an adequate remedy at

law,

specifically,

it may

bring

enforcement

action before the Illinois Pollution Control Board pursuant to Section

31(b)

of the Act, 415

ILCS

513

1(b).

Further answering, NSSD denies that Plaintiff has aprotectible interest in ensuring that

the site

location for the proposed biosolids

drying/melting, facility is approved by the

City

Council,

or that the Waukegan Zoning Ordinance is complied with,

as it relates to

the proposed

biosolids

drying/melting facility, which is

exempt

from the Ordinance.

COUNTY

CLAIM FOR DECLARATION THAT NSSD

IS REQUIRED

TO COMPLY WITH THE

WAUKEGAN BUILDING CODE

33.

Plaintiffs

adopt

and

reallege paragraphs

through 33

of Count

I as paragraphs

through

of this

Count V.

ANSWER:

NSSD adopts and restates its

answers to paragraphs I

through 33,

as is

filly

set

forth

herein.

34.

Section

6-26

of the

Waukegan

Code

Ordinances,

Chapter

BUILDtNGS

AND

BUThDThTG

REGULATIONS

(the

“Building

Code”),

adopts

“The

BOCA

National

Building Code, Twelfth Edition,

1993” (the

“BOCA Code”)

as part of the Building Code.

ANSWER:

NSSD states that the ordinance cited

in this paragraph speaks for itself,

and therefore, this

paragraph requires no

answer.

Further

answering, NSSD affirmatively states that

its design for

the proposed biosolids

drying/melting facility,

is in accordance with the BOCA Code,

but denies

that the proposed biosolids drying/melting facility, is

subject to

the BOCA Code.

35.

Section

107.1

ofthe BOCA Code provides

in relevant

part as follows:

application,

shall be

submitted

the code

official

for the

following

activities,

and these activities

shall not commence without a permit

being

issued in accordance with Section

108.0:

Construct or alter a structure

ANSWER:

NSSD states

that Section

107.1

of the BOCA Cbde speaks for itself,

and therefore,

this

paragraph requires

answer.

Further answering,

NSSD affinnatively states

that its

design for

the proposed biosolids drying/melting facility,

is in accordance with the BOCA Code, but

denies

that the proposed

biosolids

drying/melting facility, is subject to

the BOCA Code.

36.

Section

202.0

of the BOCA

Code,

General

Definitions,

defines

“structure”

“that

which

built

constructed

a portion

thereof.”

The

proposed Facility

structure

within the meaning of the Building Code.

ANSWER:

NSSD

states that Section 202.0 ofthe BOCA Code speaks for itself,

and therefore,

this

paragraph requires no answer.

Further answering,

NSSD affirmatively states that its

design for

the proposedbiosolids drying/melting

facility, is in accordance with the BOCA Code, but denies

that the proposed biosolids drying/melting facility,

is subject to the BOCA Code.

Further

answering, this paragraph states a conclusion of law to

which no

answer is required.

37.

Section

116.1

of the

BOCA

Code,

Unlawful

acts,

provides

relevant

part

follows:

It shall be

unlawful for any person, finn or corporation to

erect,

construct,

alter,

extend,

repair,

remove,

demolish

or occupy

any

building,

structure

equipment regulated by this

code, or cause same

to be done,

conflict

with or in violation of any of the provisions

of this code.

ANSWER:

NSSD states

that Section

116.1

of the BOCA

Code speaks for itself, and therefore,

this

paragraph requires

no answer. Further answering, NSSD affirmatively

states that its design for

the proposed biosolids

drying/melting facility,

is in

accordance with the BOCA Code, but

denies

that the proposed biosolids drying/melting facility,

is subject to

the BOCA Code.

38.

Section

6-47

of the Building Code

establishes

schedule of fees

for the issuance

ofbuilding

permits.

ANSWER:

NSSD

states that

Section 6-47 of the Building Code speaks

for itself,

and therefore,

this

paragraph requires

no answer.

39.

On March

12, 2002,

the NSSD submitted what it

claimed

be an

application for

Building

Permit to

the Waukegan Building

Department.

This

application was

submitted under

a reservation of

rights,

with the NSSD taking

the position that Waukegan has

no jurisdiction

impose

zoning

or building

permit

requirements

fees

the NSSD.

Copies

of the

NSSD’s

transmittal letter

and

Building

Permit

Application

are

attached hereto

Group

Exhibit

building

permit has to

date been issued by Waukegan.

ANSWER:

NSSD

admits that it filed an application for zoning approval and building permits with

the City of Waukegan on March

12, 2002.

Further answering, NSSD states that Group Exhibit E

to Plaintiffs Amended Complaint, which NSSD

admits contains true and accurate copies of

NSSD’s application and transmittal letter to the City ofWaulcegan, speak for themselves.

NSSD

admits that the City ofWaukegan has to

date failed to render a decision on its

application.

40.

An actual controversy exists between the parties regarding the NSSD’s obligation

secure a building permit from Waukegan.

ANSWER:

This

paragraph states

a conclusion of law to which no

answer is

required.

the extent

this paragraph may be interpreted to

contain a factual allegation, NSSD denies each and every

such allegation.

COUNT VI

CLAIM FOR

INJIJNCTTON PRECLUDING THE

NSSD FROM CONSTRUCTING THE

FACILITY ABSENT COMPLIANCE

WITH THE

WAUKEGAN BUILDING CODE

40.

Plaintiffs

adopt and reallege paragraphs

through

of Count

as paragraphs I

through

this Count VI.

ANSWER:

NSSD

adopts

and restates its

answers to paragraphs

through

40,

is fully set forth

herein.

41.

Waukegan

and

the

City

Council

have a

protectible

interest

ensuring

that

the

Waukegan

Building

Code

complied

with.

Waukegan

and

the

City

Council

would

irreparably harmed if the Facility were allowed to be permitted, constructed and operated without

proper permits.

such, Waukegan and the City Council have no adequate remedy at law.

ANSWER:

This paragraph states a conclusion oflaw to which no

answer is required, but is in any

event denied by NSSD.

the extent this paragraph may be

interpreted to contain a factual

allegation, NSSD denies each and every such allegation.

Further answering, NSSD affirmatively

states that Plaintiffhas an adequate remedy at law, specifically, it may bring an enforcement

action before the Illinois Pollution Control Board pursuant to Section

1(b) of the Act, 415

ILCS

5/31(b).

Further

answering, NSSD

denies

that Plaintiff has a protectible interest in ensuring that

the Waukegan Building Code

is complied with,

as it relates

to the proposed biosolids

dryinglmelting facility.

which

exempt from the Code.

AFFIRMATIVE DEFENSES

FIRST AFFIRMATIVE DEFENSE

Plaintiff’s

Amended Complaint, and each of the Counts

thereof, fails to state a claim

against NSSD upon which the requested relief may be

granted.

SECOND

AFFIRMATIVE DEFENSE

Plaintiff lacks standing to

assert the claims

alleged in the Amended Complaint for

declaratory and injunctive relief.

THIRD AFFIRMATIVE DEFENSE

Plaintiff has failed to

exhaust all administrative remedies, as required prior to

initiating

this judicial action for declaratory and injunctive relief.

FOURTH AFFIRMATIVE DEFENSE

The matters alleged in the Amended Complaint are not ripe for adjudication.

FIFTH AFFIRMATIVE DEFENSE

Plaintiff cannot seek to

enjoin the lawful actions ofpublic

officials and agencies.

SIXTH AFFIRMATIVE DEFENSE

Plaintiff has an

adequate

remedy

at law,

and

therefore is not entitled

to the declaratory

and injunctive

relief sought in the Amended Complaint.

Specifically, Plaintiff may bring

enforcement action before the Illinois Pollution Control Board

pursuant to

Section 31(b) ofthe

Act, 415

ILCS

5/31(b).

SEVENTH

AFFIRMATIVE DEFENSE

The proposed bicsolids

drying/melting

facility, is exempt

from the siting requirements of

Section 39.2

of the Act, 415

ILCS

5/39.2.

EIGHTH

AFFIRMATIVE DEFENSE

The proposed biosolids drying/melting

facility, is exempt

from the requirements of the

City of Waukegan Building

Code, the City ofWaukegan Zoning Ordinance, and the BOCA

Code.

NINTH

AFFIRMATIVE DEFENSE

The City of Waukegan, by virtue of its past practices,

is estopped from asserting that the

proposed biosohds drying/melting facility, is subject to the siting requirements of Section 39.2

the

Act, 415

ILCS 5/39.2,

or the

City ofWaukegan Building Code, or the City of Waukegan

Zoning Ordinance, or the BOCA Code.

TENTH

AFFIRMATIVE

DEFENSE

As set

forth in NSSD’s verified counterclaim,

and in the alternative, NSSIJ has a vested

right to

issuance of any zoning and building permits which it maybe required to obtain prior to

construction ofits proposed biosolids drying/melting facility.

VERIFIED

COUNTERCLAIM OF THE

NORTH SHORE

SANITARY DISTRICT

FOR

DECLARATORY

AND

INJUNCTIVE RELIEF

AND MANDAMUS

Defendant/Counter-PlaintiffNorth Shore Sanitary District (“NSSD”),

by and through its

attorneys,

Gardner,

Carton

Douglas,

its

Verified

Counterclaim

for

Declaratory

and

Temporary,

Preliminary

and

Permanent

Injunctive

Relief

and

Mandamus

against

Plaintiffs/Counter-Defendants

City

Waukegan,

Daniel

Drew,

Mayor

the

City

Waukegan,

and

John

Balen,

Sam

Cunningham,

“Tony”

Figueroa,

Frank

Harris,

Jr.,

Richard

Hyde,

Patrick

Needham,

John

Rickerd,

and

Lawrence

TenPas,

members

of the

Waukegan

City

Council,

Russ

Tomlin,

Director of Planning

and

Zoning,

and

Chuck

Perkey,

Building

and Planning Director (collectively, “Defendants”),

states as follows:

GENERAL

ALLEGATIONS

NSSD

a unit of government,

established

the North

Shore Sanitary District

Act,

ICS

2305/0.1,

seq.

(“NSSD

Act”),

the

North Shore

Sanitary

District

Extension

(1st) Act, 70

~CS

2310/0.01,

seq.,

and

the North

Shore Sanitary District

Extension (2nd)

Act, 70 ILCS

2315/1,

etseq.

The

Board of

Trustees of the NSSD

is obliged under

the NSSD Act to

fulfill

its

duties to the public as follows:

Such

board

shall

provide

suitable

and

modernly

equipped

sewage

disposal

works

plants for the separation and disposal of all solids

and deleterious matter from the liquids,

and

shall

treat

and puri~~

the residue of such sewage

so that when it

flows into any

lake,

will not injuriously contaminate the waters thereof.

The board shall adopt any feasible

method to accomplish the objectfor which such sanitary district may be

created.

ILCS

2305/7

(emphasis added).

NSSD

charged with

the disposal of sewage

for

a population of approximately

350,000

people

within its

Facility

Planning Area boundary,

which

encompasses

the geographic

area roughly bordered by Lake Cook Road on the south,

the Illinois

and Wisconsin border on the

north,

the Tn-State Toflway on the west, and Lake Michigan on the east.

(See

Map ofBoundary,

attached hereto as Exhibit

1.)

There

are

individual municipal governments within the Facility Planning

Area,

including

Beach Park,

Highland Park,

Highwood,

Knollwood,

Lake Bluff,

Lake

Forest,

North

Chicago, Waukegan,

Winthrop Harbor, Zion, and Lake County.

Defendant Waukegan is

a municipal corporation located in Lake County, Illinois.

Defendant Richard H.

Hyde

the Mayor of the

City of Waukegan,

a citizen of

the State ofIllinois

and resident ofthe City of

Waukegan (the “Mayor”).

Defendants

John Balen,

Sam

Cunningham,

I. A. “Tony” Figueroa, Frank Harris,

Jr.,

Richard Hyde, Patrick R. Needham, John Rickerd, and Lawrence TenPas

are members of the

Waukegan

City Council,

citizens of the

State of Illinois, and residents of the City of Waukegan

(the “City Council” or“Aldermen”,

respectively).

Defendant

Russ

Tomlin

the Director of Planning

and

Zoning

for the City

Waukegan and an

agent for the

City of Waukegan.

Defendant Chuck Perkey

the Director of Building

and Planning for the City of

Waukegan and an

agent for the City ofWaukegan.

10.

This action

relates to the

unreasonable

efforts

Waukegan

to thwart or frustrate

the NSSD in

its efforts

fulfill its

statutory duties

to its

constituents.

The NSSD

operates three

wastewater

treatment

plants

Lake

County,

illinois

located

Highland

Park,

Gurnee

and

Waukegan.

These

plants

receive

and

treat

domestic

sewage,

well

some

industrial

discharges which

are

from

point sources subject to

discharge permits

under

Section

402

of the

Clean Water

Act,

U.S.C.

1342.

the

extent required, all industrial

discharges

are treated

4,7

through the permitted pre.treatrnent program prior

receipt by

the NSSD plants.

Wastewater

delivered to

the aforementioned sewage treatment plants by sewer lines.

11.

The NSSD treatment plant

Waukegan

located

Dahringer Road along

the

Lake Michigan lakefront.

NSSD has operated the Waukegan sewage

treatment plant

since

1928

on approximately

72 acres ofland owned by the NSSD.

12.

NSSD

has

transported

sludge

through

the

boundaries

the

NSSD

Facility

Planning

Area,

including through Waukegan,

from the Waukegan

sewage treatment plant,

for the

past 74 years,

and

for over 30 years to

a landfill it owns and operates in Newport Township.

CURRENT

METHOD OF SLUDGE DISPOSAL

13.

The

NSSD

for several

years

has

been

leader

researching,

developing

and

implementing

a more

environmentally

responsible

and

economical

means

of waste

disposal.

This has entailed utilization of state ofthe art wastewater sewage treatment processes.

It has also

involved the NSSD’s diligence in researching

and developing the most optimal disposal methods

ofsludge created from its wastewater

treatment processes.

14.

In its

continuing

efforts to improve its

service to

its

constituents, the NSSD over a

decade

ago

developed a process of

combining fly

ash

and

sludge to

make “fludge.”

This

was

revolutionary

breakthrough in

waste

disposal

because

fludge

had

environmentally

remarkable

attributes:

the

smell

was

locked

into

the new

structure

and

the propensity

of the

hazardous

materials

contained in

the sludge

leach

out

over

time

was

markedly

decreased.

Moreover,

when

a volume of sludge was mixed

with

equal

volume

of fly ash the resulting

fludge was

only

160

of the prior

volumes.

The

landfill’s

life

was extended

from

years

with

the

fludge process.

15.

However,

“fludge”

still requires

disposal

landfilling,

which

takes

place

the

landfill

at Newport Township.

The NSSD

currently

disposes

of approximately

52,600

tons

sludge

each year.

The current disposal process results

approximately

200,000

cubic yards of

fludge

being

disposed

of in

the

landfill

each

year.

The

NSSD’s

only

existing

and

available

permitted

landfill

located

property owned by

NSSD

Newport Township

the

City of

Zion,

and its

available capacity

in Cell A will be exhausted within two

and one-halfyears.

16.

The

NSSD

also

owns

land

adjacent

Cell

which

has

obtained

development

permit

for

landfill,

which

would

add

only

another

five

years

of capacity

for

sludge

disposal via landfill.

open and

operate

the new landfill would require the issuance by

the Agency of a

construction

and

operating permit

for the site

well as

site development that

would

conservatively cost the NSSD $4,670,000 before the site would be

available for landfill.

17.

If the NSSD

started inniediately to

make this additional

land available

fludge, it would

take at

least twenty-three months

before it could be ready to

accept the

fludge,

assuming no unforeseen delays or obstacles.

There

is a material risk that the NSSD would not

able

bring

the new land

fill

space

on-line before

its

current

land

fill

filled

its

current

fludge disposal.

18.

While until now

landfilling

fludge has been the only viable method to NSSD, it is

not an environmentally desirable

disposal method as compared to the Biosolids

Reuse project.

BENEFICIAL BIOSOLIDS REUSE

PROPOSAL

19.

The

United

States

Environmental

Protection Agency uses the

term “biosolids” to

distinguish

sewage

sludge

which

beneficially

reused,

rather

than

discarded.

See

Standards for

the

Use or Disposal of Sewage Sludge,

Fed.

Reg.

9248,

9251

(Feb

19,

1993)

(codified

CFR Part

503).

49.

20.

For

the

past

few

years,

the

NSSD

has

been

researching

alternatives

sludge

disposal

involving

biosolids

reuse.

This

research

has

included

examining

proven

processes

common

Europe

and

elsewhere

where

beneficial

reuse

promoted.

The process

the NSSD

has

discovered

and

developed

the

state

of the

art

method

of biosolids

reuse

the

most

environmentally responsible method

developed

date.

In this

process,

the biosolids

are dried

and

used

the

fuel

for

melting

itself

into

glass

product

with

innumerable

commercial

applications

(“Biosolids

Reuse

Project”).

Moreover,

this

process,

the

hydrocarbons

are

completely used up

in the melting process,

and all inorganic

materials, including all heavy metals

except a small

amount of mercury, become locked into the glass structure.

21.

The

NSSD will then sell

this

glass

for commercial

uses.

One of the

commercial

uses

for

this

glass

product

replacement

for sand

concrete,

which

renders

the resultant

concrete

even

stronger than if sand

were

used.

September 26,

2001,

the

NSSD

entered into

Glass

Aggregate

Purchase

Agreement

(“Agreement”)

with

Minergy

Corp.

copy

the

Agreement

attached hereto

Exhibit

2).

Under

the

terms

the

Agreement,

NSSD

has

agreed

sell,

and

Minergy

has

agreed

buy,

all

of the

Glass

Aggregate

produced

from

the

Biosolids Reuse Project.

The

Glass Aggregate is “the product made in the GlassPack

process...,”

which

the

“closed-loop

process

invention

for

the

conversion

of’

sludge

from

municipal

wastewater

treatment

plants

into

Glass Aggregate...”

The Agreement

provides

for a minimum

purchase priceby Minergy for the

Glass Aggegate

of 5.00

per

ton F.O.B. the

plant.

22.

NSSD’s

Biosolids Reuse Project is environmentally beneficial

in that it eliminates

the

need

for

scarce

landfill

space

and

turns

what

otherwise

would

waste

product

into

something

reusable.

Environmentally beneficial recycling

and reuse of materials

in encouraged

by the Illinois Environmental Protection Act.

415

ILCS

5120(a)(b).

23.

accordance

with

its

statutory

obligations

under

the

NSSD

Act,

the

NSSD

intends

implement

the beneficial

Biosolids

Reuse

Project

its

Waukegan

sewage

treatment

plant on

the land it has owned in Waulcegan since the early

1900’s, when the NSSD was created

by the legislature.

24.

operation

of the

Biosolids

Reuse

Project,

the

biosolids

will

contained

silos located inside a covered building, prior to being processed for drying and melting.

25.

the

wastewater

and

sewage

treated

NSSIJ,

approximately

twenty-five

percent originates

from the residents of the

City of Waukegan.

Similarly, approximately twenty-

five percent of the biosolids

to be recycled into

glass will

originate

from the residents of the City

of Waukegan.

26.

NSSD’s

current

waste

disposal

system

already

uses

drying

dewatering

process.

The new

drying/melting process of the Biosolids

Reuse

Project will

not

increase,

and

may

serve

reduce,

odor.

In the

Biosolids

Reuse

Project,

less

than

88 c~

(cubic

feet

per

minute) of emission will be vented as

a result of the drying process,

as compared to

the average

household

bathroom

vent,

which

typically

emits

100

cfln,

and

emissions

from

the

proposed

Biosolids Reuse Project

will be subject to odor control treatment.

ALTERNATIVES

TO CONSTRUCTION

OF PROJECT IN WAUKEGAN

27.

The

NSSD

has

agreed

sell

land

owns

that

adjacent

the

Newport

Township

landfill to the City of Zion, under an agreement entered

into October 8, 2001

(“NSSD-

Zion

Agreement”).

Under the

NSSD-Zion

Agreement,

contingency

case NSSD

was

prevented

from

constructing

and

operating

the Biosolids

Reuse

Project on

NSSD’s

property in

Waukegan, the NSSD reserved the right to use the part of the property on

which NSSD currently

has

landfill

development

permit

construct

and

operate

the

Biosolids

Reuse

Project

and

related

facilities

long

complies

with

the

Environmental

Protection

Act

and

Illinois

Enviromnental Protection Act requirements.

28.

In order for NSSD

to construct the beneficial

Biosolids Reuse

Project on

the Zion

property,

the

NSSD

would

have

the

following:

(a)

build

roads,

sewers,

water

supply

piping,

and

other

preliminary infrastructure planning and

construction

that would conservatively

cost the NSSD

$18,000,000 over

the next

twenty years,

more than the project

at the

Waulcegan

location

and

take,

conservatively,

months

complete;

(b)

develop

new plans

that will

more complicated due

to the current undeveloped nature of the Zion property; (c)

apply for and

obtain Air and Land permits

from

the Agency; and (d)

face the possibility of defending a suit by

the

Lake

County State’s Attorney, since the IEPA

siting issue would be no

different

in Zion than

in Waukegan for Biosolids Reuse Project.

29.

The

Biosolids

Reuse

Project

requires

approximately

275,000

gallons

of water

each

day

for

cooling

and

other

purposes.

This

water must be

disposed of daily.

There

water

sewer

capacity

currently

NSSD’s

Zion

property

for

this

purpose.

Therefore,

construction

and

development of the

Biosolids

Reuse

Project

Zion

would

require

NSSD

construct

piping

secure

approximately

100,000,000

gallons

of fresh

water

from

the

City

Zion

at an annual

cost of 3197,000.00.

Because there is

currently no

sewer

system

available

that

land, NSSD would be required to construct miles of new sewers to remove the cooling water

and

other

discharges.

contrast,

constructing and

operating

the Biosolids

Reuse

Project on

NSSJ’s

Waukegan

site,

NSSD

can

utilize

the residual water

from

its

treatment

plant

before

pumping

the

DesPlaines

River

through

the

NSSD’s

existing

sewers

and

pumps

that

location.

This also saves anothermaterial resource from being wasted.

30.

estimated that

it will

cost

the NSSD

than

$11,000,000.00

initially and

more

than

$360,000.00

annually

over

what

will

cost

NSSD

construct

and

operate

the

Biosolids

Reuse Project

at NSSD’s

Waukegan property.

31.

NSSD

currently

transports

five truckloads of sludge

from

its

Waukegan

sewage

treatment plant, five

from its Gumee plant,

and two

from its Highland Park plant on a daily basis

Monday

through

Friday,

its

Newport Township

landfill.

order

eliminate

the

current

method of sludge

discard

and disposal through

landfilling,

and facilitate this new biosolids

reuse

process,

the

NSSD

intends

cease

transporting

sludge

from

its

Waukegan

sewage

treatment

plant to the NSSD’s Newport Township landfill.

AUTHORIZATION TO PROCEED

Project Permits from

the Illinois Environmental

Protection Agency

32.

April

16,

2001,

NSSD

submitted

Air

Emission

Construction

Permit

Application

to the Illinois

Environmental Protection Agency (“IEPA”)

to construct and operate

biosohds

drying/meltin.g

facility (the “biosolids drying/melting facility”)

at its

Waukegan sewage

treatment plant.

33.

On August 19, 2001,

LEPA published a public notice

(“Notice”) requesting public

comments

draft

permit

authorizing

the

construction

“sludge

processing

facility,

consisting

sludge

receiving

and

storage

area

drying

process,

and

melting

process

Dahringer

Road

Waukegan”,

air emission

source

(“Air

Permit”).

(The

Notice

and

Air

Permit

are attached hereto as Exhibits

and

respectively.)

A Public Hearing

was

held on this

application by the IEPA.

The EPA

did

not

issue the

Air Pennit

for the Biosolids

Reuse Project

until March

11, 2002,

some eleven months

after NSSD

‘5

application.

34.

addition

the

Air

Permit,

the

IEPA

also

requested the

NSSD

submit

Agency

Bureau

Land Permit

Application

and

Technical

Support

Documents

construct the

biosolids

drying/melting

facility at

its

Waukegan

facility.

The NSSD

did

November

26,

2001.

EPA

also

published

a public

notice

for

this

permit

and

public

hearing was

held

January

24,

2002.

On March

11,

2002,

the IEPA

issued

a land permit

for the NSSD’s

proposed

beneficial

Biosolids

Reuse

Process

its

Waukegan

sewage

treatment

plant.

(The notice

and

land

permit

are

attached

hereto

Exhibits

and

respectively).

The

EPA

found that

the

“ceramic” material produced from

the sludge is not

a waste in at

least two applications for which

NSSD had submitted data.

35.

The

Illinois Environmental Protection Act requires

siting only

for the construction

development of a “new

pollution

control facility.”

415

ILCS

5/39(c).

36.

415

ICS

5/3.32

the

Illinois

Environmental

Protection

Act

provides,

pertinent part, the following:

Sec.

3.32.

Pollution

control

facility.

(a)

“Pollution control

facility” is

any

waste

storage

site,

sanitary landfill, waste disposal site, waste transfer station, waste

treatment

facility,

waste

incinerator.

This

includes

sewers,

sewage

treatment

plants,

and

any

other

facilities owned or operated by sanitary districts organized under the Metropolitan

Water

Reclamation District

Act

ICS

2605/1

seq..

The following are

not pollution

control facilities:

(3) sites orfacilities used by

any person conducting a waste storage,

waste

treatment,

waste

disposal,

waste transfer or waste

incineration operation,

or a

combination thereoffor wastes

generated

by such person ‘s own activities,

when

such wastes are stored,

treated,

disposed. of transferred or

incinerated within the

site orfacility owned,

controlled or operated by such person,

or when such

wastes are transported within

or between

sites orfacilities owned,

controlled or

operated by such person....

415 ILCS

5/3.32 (emphasis added).

37.

The

permits

requested

NSSD

are

for

processing

sludge/biosolids

generated

from

NSSD’s

own

activities

within

the

meaning

of the Illinois

Environmental

Protection

Act.

The Illinois Environmental

Protection Act’s definition of “sludge” is as

follows:

Sec.

3.44.

“Sludge”

means any solid, semi-solid, or liquid

waste generatedfrom

municipal,

commercial,

or industrial wastewater treatment plant,

water supply

treatment

plant,

or air pollution control facility or any other such waste having similar

characteristics

and effects.

415

ILCS

5/3.44 (emphasis

added).

38.

Defendants

not

and

never

wanted the

NSSD’s

project

constructed

Waukegan

and

have

made

numerous

attempts

stop

the

NSSD’s

Biosolids

Reuse

Project,

including

causing written and

oral protests

the project

be made before the EPA

in person

and at public hearings.

39.

On September

10,

2001,

one ofWaukegan’s attorneys, Jeffrey Jeep,

wrote a letter

EPA

stating

that EPA

is without authority to

issue any

permit for the development of a new

pollution control facility in the absence of a Local Siting Approval issued by the Waukegan City

Council,

and that the EPA should accordingly terminate its

review of the Application and cancel

the October

2001

public hearing relating to

the Air Permit.

(The September

10,

2001

letter is

attached

hereto

Exhibit

7.)

Waukegan

claimed

the

Biosolids

Reuse

Project

would

pollution

control

facility

and

would

thus

require

siting

under

Section

39.2

the

Illinois

Environmental Protection

Act.

40.

Also

September

10,

2001,

Robert

Masini,

one

the

attorneys

for

Waukegan,

sent

NSSD

letter,

stating

that

Waukegan

expects a

“host

community agreement”

from

the NSSD

before

the

NSSD

could

proceed

with

the

Biosolids

Reuse

Project,

and

also

stating

that:

“additionally,

the

propo~ed.sludge

facility

subject

the

City’s

Zoning

Ordinance and Building

Code requirements

and fees.”

(A copy of the September

10,

2001

letter

from Mr.

Masini

attached as

Exhibit

S.)

41.

The NSSD filed a response with

the EPA

Mr. Jeep’s

protest, demonstrating to

the satisfaction of the IEPA that the proposed Biosolids Reuse Project was not

a pollution control

facility requiring local

siting

because of one

or more

exclusions

from the definition of Pollution

Control Facility under the Illinois Environmental Protection Act.

42.

letter dated September

25,

2001, the EPA

informed Waukegan that the public

hearing scheduled for October

3, 2001

would proceed and that the EPA

would continue with its

review of the Application even

the absence of proof of a Local

Siting

Approval.

copy of

the

IEPA’s

September 25, 2001

letter is attached hereto as Exhibit 9.)

43.

The

EPA

agreed

with

the NSSD

that

“sludge”

a defined

term in

the

Illinois

Environmental Protection

Act,

that

the only

sludge that would

processed

the new facility

would be sludge

generated from the NSSD’s

own waste water treatment

processes, and that

the

facility

was therefore

excluded

from the definition of Pollution Control Facility and

not

subject

to the local

siting requirements of Section

39.2 of the Illinois

Environmental Protection Act.

44.

The

process recycles

the NSSD’s sludge

into a commercially viable product,

should not be considered waste,

45.

During

the October

2001

public

hearing

the proposed

Air Permit,

Robert

Masii

restated

Waukegan’s position that the EPA

is without authority to

continue its

review of

the Application

or issue the Air

Permit absentproof of a Local Siting Approval.

46.

letterdated November

15,

2001

to the EPA,

Waukegan again stated that

the

EPA

without

authority

issue

any

permit

for the

development of a new pollution

control

facility on the NSSD property absent a Local Siting Approval.

(The November

15, 2001

letter is

attached as Exhibit

10.)

47.

Waukegan

was not

successful

attempting

impede

the lawful issuance of all

permits

deemed necessary by IEPA to

allow NSSD

to proceed with construction of its

Biosolids

Reuse Project.

Independence

ofNSSD

from Local Zoning

48.

The

NSSD

unit of regional

government,

established

state

statute,

and

constructing the biosolids

reuse

facility,

NSSD

exercising

its

statutory

authority

thlfill

need, wastewater treatment and disposal, that

can only

met on a regional basis.

49.

The

NSSD

serves

several

other

municipalities,

some

which

are

themselves

home rule units.

NSSD

is an independent government body and

the performance

of its

statutory

duties may not be

frustrated by local

land

use or zoning controls, even those of home rule

units

of government,

such

Waukegan.

NSSD’s

statutory

regional

powers

are not

subordinate

those of

Waukegan,. and

a result,

under

City ofDes Plaines

Metropolitan

Sanitary District

of Greater

Chicago,

Ill. 2d

11,

268

N.E.2d 428

(1971);

City

of Des Flames

Metropolitan

Sanitary District of Greater Chicago,

Ill.

2d 29,

31,

32,

319

N.E.2d

(1974);

Metropolitan

Sanitary

District of Greater Chicago

City

of Des

Plaines,

IU.

256,

347

N.E.2d 716

(1976)

(collectively,

the

“Des

Plaines

Trilogy”),

and

under

The

Village of Swansea

The

County

of St.

Clair,

Ill.

App.

184

(5th

fist.

1977),

NSSD’s

Biosolids

Reuse

Project

exempt from

Zoning.

50.

September 26, 2001,

Murray Conzelnian, the attorney

for the NSSD, met with

Jeffery

Jeep

and

Robert

Masini,

attorneys for Waukegan,

discuss

the proposed NSSD

project

attempt

through

intergovernmental cooperation

to explore whether Waukegan

had

any

reasonable requirements relative to the project that

the NSSD could

meet

consistent with the

NSSD’s

statutory duty to its

constituents.

51.

In that September

26th

meeting, Mr.

Conzelman informed the

Waukegan attorneys

of the NSSD’s

understanding

that

the NSSD

not

required

obtain

local

siting

because

the

Biosolids

Reuse

Project

not

a New Pollution

Control

Facility.

Mr.

Con.zelman

also

advised

the

Waukegan’s attorneys that

the NSSD

did not

believe

its

construction of the Biosolids

Reuse

Project would

subject to

Waukegan’s Zoning

Ordinance,

so there would

be no

requirements

for

variances

or any conditional

use permits

or approvals from

the City for the Biosolids

Reuse

Project.

Mr.

Conzelman

also advised the

Waukegan

attorneys

that he

did

not believe the NSSD

could be required to

obtain

building permit

for the Biosolids Reuse Project.

WAUKEGAJ”i’S ATTEMPT TO

IMPEDE NSSD THROUGH

ZONING

The Previous Zoning Ordinance

52.

At the

time

of the September

26th

meeting, Waukegan

was

aware

that NSSD

was

exempt

from

its

zoning

ordinance

under

Section

6.3.2

the

Waukegan

Zoning

Ordinance,

which

exempted

Public Utilities providing

essential

services

such

disposal

systems,

which

includes

the NSSD

and

its

current

facility

Waukegan

and

its proposed

new

Biosolids

Reuse

Project.

Under

the

then-current

Waukegan

Zoning

Ordinance,

Subsection

of Section

6.3

MJNICIPAL

OR PUBLIC USE AND ESSENTIAL SERVICES

EXEMPTED,

provided:

The erection,

construction,

alteration,

or maintenance by public

utilities

or municipal

departments

or commissions, of overhead, sur±kce

under~ound

gas,

electrical,

steam,

or water distribution or transmission systems, collection,

communication, supply or

disposal systems, including mains, drains, sewers, pipes, conduits, tunnels, wires,

cables,

fire

alarmboxes, police call boxes,

traffic

signals,

hydrants,

towers, poles, electrical

substations,

gas

regulator stations and other

similar

equipment

and

accessories in

connection

therewith,

reasonably necessary for the

furnishing

adequate

service by such

public health,

safety, or general

welfare,

shall be exempt from the regulations ofthis

ordinance.

Provided, however,

that the installation shall confonu to Federal

Communications Commission and Federal Aviation Agency rules

and regulations,

and

those ofother authorities having jurisdiction.”

53.

the

time

the

September

26Lh

meeing,

Section

10.4-3(46)

the

Zoning

Ordinance

also

classified

“public

utility

and

service uses”

a permitted use in

the

District,

which applied to NSSD.

(A copy of that ordinance

is attached as Exhibit 11.)

54,

the

time

of the

September

26th

meeting,

the

Defendants

loew

that

NSSD

believed

that

was

important

NSSD

and

its

constituents

that

the

Biosolids

Reuse

Project

should be

commenced as

soon as the EPA

permits

were

issued.

At that time,

Defendants

also

knew that NSSD intended to have the project bid out immediately upon issuance of permits from

the EPA.

Amendment of

the Zoning Ordinance to Thwart NSSD

55.

Defendants were

aware

that

NSSD’s

Biosolids

Reuse

Project

was

either

exempt

from zoning or was a permitted use

General Industrial District.

On Noyember

19, 2002,

Defendants

passed

special

legislation

aimed

taking

away

the

exemption

the

zoning

ordinance that

applied to

NSSD

and

its

Biosolids

Reuse

Project.

Defendants

and

their counsel

were

mindful

of the

fact

that

NSSD

was

not

under

the

terms

of the

then

zoning

ordinance

required to

obtain a special use permit under the terms of the Ordinance.

Therefore,

Defendants

and their counsel decided to

change the Zoning Ordinance in an obvious attempt

make it more

difficult

impossible

for

NSSD

construct

its

Biosolids

Reuse

Project

Waukegan.

pursuit of their objective, on November

19,

2001,

the Defendants passed

ordinance

01-0-125,

amending

Section

6.3.2.

Waukegan’s

zoning

ordinance

narrowly

define

“Public

Utilities”

such

way

remove

the

NSSD

and

its

Biosolids

Reuse

Project

from

the

exemption.

the

same time,

Defendants

also

amended

the

Zoning

Ordinance

reclassify

“public

utility and

service uses” from a permitted use to

a conditional

use in the

District

under

Section

10.4-3(46)

of the Zoning Ordinance.

Finally,

November

19,

2001,

the City Council

also adopted 01-R-126, imposing a one-year moratorium on the approval ofbuilding permits

and

zoning

approvals

for

all

development

along

the

lakefront.

(The

Moratorium

attached

Exhibit

12.)

56.

and

before

November

19,

2001,

NSSD

had

vested

right

pursuing

the

project

under

the

zoning

then

force,

which

Defendants

sought

frustrate

and

take

away

through

these

ordinances.

These

ordinances

are

special

legislation

aimed

either blocking

NSSD

from

constructing

its

Biosolids

Reuse

Project

outright,

with

the

object

of materially

delaying

NSSD

constructing

its

Biosolids

Reuse

Project

for

long

enough

time

that

would

become

infeasible

for

the NSSD

build

the

proposed

facility

Waukegan.

These

ordinances

violate the

Bill

of Attainder

Clause

of the United

States

Constitution,

(U.S.

Const.

Art.

Section

10), and

the prohibition

against

special legislation

set

forth

in Article

IV,

Section

the

Illinois

Constitution

1970

(III.

Const.

1970,

Art.

IV,

Section

3),

and

finally

constitutes

unconstitutional

taking

of property,

violation of the Fifth

Amendment

of the

United

States

Constitution,

and should

therefore

be invalidated.

57.

As of the September 26,

2001 meeting and as of the date of NSSD’s~

property sale

agreement with the City of Zion, neither Waukegan nor any of its agents

and representatives ever

communicated

any

manner whatsoever to

NSSD or its

agents

and

representatives that

NSSD

was consideringre-zoning NSSD’s Waukegan property.

58.

all

times,

NSSD

acted

good

faith in

reliance

the

zoning

ordinance

effect

prior

November

19,

2001,

which

did permit

NSSD

construct

the Biosolids

Reuse

Project on the NSSD’s proposed site.

The Zoning

and Building

Code Applications

59.

Assuming NSSD

not

exempt

from

Zoning,

NSSD’s

Biosolids

Reuse

Project

falls

within

permitted

use

the

zoning

classification

which

the

project

will

built.

NSSD’s

land

which

the project

will

built

located

General

Industrial District

under

Waukegan’s Zoning

Ordinance.

Such

District

established

under

Article

10.4

of the

Zoning

Ordinance.

Section

10.4-3 establishes “Permitted Uses” in

the 12

district, in relevant

part

follows:

“(26)

Glass products production”

“(44)

Pottery and ceramic manufacture”

60.

The

manufacture

Glass

Aggregate

permitted

use

the

General

Industrial District

because

falls within

either or both of Glass

products production or Pottery

and ceramic manufacture.

61.

Assuming NSSD

not

exempt

from

Zoning

and

not

within a permitted

use,

NSSD’s Biosolids Reuse Project

falls

within a conditional use

for which a conditional

use permit

should be

granted.

Otherwise, NSSD’s

ability to thIflil

its

statutory obligation to

its

constituents

would be frustrated.

62.

Section

10.4-4(26),

Conditional

Uses,

General

Industrial

District,

the

Zoning Ordinance provides in relevant part as follows:

The

following

conditional

uses

may

allowed

the

District,

subject

the

provisions of Section 3.11:

Other manufacturing,

processing,

storage,

or commercial uses detennined by the

Zoning Administrator to be of the same general character as the use permitted in

Section

10.4—3,

above,

and found not be obnoxious, unhealthful, or offensive by

reason of the potential

emission or transmission of noise, vibration,

smoke, dust,

odors, toxic or noxious

matter or glare or heat.

63.

All but

two of the Defendants filed suit against NSSD

and the IEPA on December

2001,

in this

Court,

claiming violations

by the NSSD of the Illinois Environmental Protection

Act

and

certain

Waukegan

ordinances

pertaining

zoning

and

building

permits.

The

IEPA

moved

dismiss

the

counts

under

the

Illinois

Environmental Protection

Act,

and

the NSSD

moved

for judgment on

the pleadings

on those counts

well.

These motions were granted with

prejudice by the Court on March

2002.

The NSSD

also moved for judgment on the pleadings

the

remaining

counts

relating

zoning

and

building

permits

and

the

Court

granted

that

motion without prejudice.

64.

Since the IEPA had not yet issued permits,

NSSD could not file an application

for

building

permits

any

zoning

materials.

Because

the

above

facts,

was

unclear

what

Waukegan

would

require of

it.

Therefore,

March

2002,

one

of NSSD’s

counsel

wrote

Michael

Blazer,

one

of the attorneys

for Waukegan,

asking

what

Waukegan would

require by

way of zoning and building permits of the NSSD.

NSSD hoped

avoid unnecessary delay over

zoning

and

building

permit

issues,

because

of the

substantial

and

irreparable harm

that

would

result

the NSSD’s

constituents

from

delay

constructing the Biosolids

Reuse

Project.

copy of the letter is

attached

as Exhibit

13.)

65.

Counsel for Waukegan’s response to

that letter was made in writing by Mr. Blazer

March

2002.

copy

attached

Exhibit

14.)

copy of

the

ordinance

was

not

attached,

contrary

what Mr.

Blazer

stated in

his

letter.

Mr. Blazer’s

response evidences

intention

the

part

of Waukegan

not

engage

good

faith

interaction

with

NSSD

addressing

Wankegan’s

reasonable

zoning

and

building

permit

requirements

the

spirit

intergovernmental cooperation.

failed

answer

the NSSD’s

specific

zoning

and

building

permit

and

building

permit

fees

inquiries,

except

partially

respond

the

inquiries

the

Moratorium Ordinance.

Notably,

Mr.

Blazer

stated the

obvious,

that

the

Ordinance

does

not

even address

moratorium

processing

any

application

made by NSSD.

But,

offered no

hope of any

relief from

the

effect

of the Moratorium Ordinance, that

is,

absolutely

permits

will issue

until

after November

17,

2002

for NSSD, regardless.

This

the

theme continued

Waukegan on the Zoning Moratorium to

date.

66.

After the permits were

issued by

the EPA,

Robert

Masirii, Waukegan’s attorney,

was

contacted

behalf of NSSD

about

whom

NSSD

should

make

its

application.

Mr.

Masini

advised that the NSSD should

direct

the application

and

inquiries

Mr.

Chuck Perkey,

Building

and

Planning Departments

of the City of Waukegan,

who

would

then

make

sure

the

appropriate persons received the application.

67.

On March

12,

2002,

the day

after the

permits

were

issued

the

EPA,

Brian

Jensen,

General Manager of NSSD,

sent

Mr.

Perkey

the NSSD’s

application

for a

building

permit,

under

cover letter reserving NSSD’s

rights.

the

letter,

Mr.

Jensen

also requested

Waukegan’ s

views

zoning

requirements

and

approvals

that

Waukegan

would

require

and

what building

permit fees, if any

would be

required.

(A copy of

the letter is

attached as Exhibit

15.)

The submission also

included

a set ofPlans.

68.

On March

13,2002,

Mr.

Perkey

requested

the NSSD

provide

four additional

complete sets ofPlans, which were delivered to him on March

15,

2002.

69.

NSSD

must

start

fabrication

of the

silos

and

certain

other

structures

included

within

the

Biosolids

Reuse

Project

before

construction

can

commence.

NSSD

notified

Defendants

of this

fact in writing

March

28,

2002.

In his

March

28,

2002. letter

Messrs

Perkey and

Tomlin, Mr. Jensen not

only inquired about the

status of the NSSD’s

application, but

reiterated

the

importance

of moving

quickly

possible

and of the necessity

of certain pre-

construction

fabrication on

site.

(See

letter attached

Exhibit

16)

In relevant

part,

the

letter

states:

previously mentioned,

very

important

that

we resolve

any

zoning

and

permit

issues

soon

possible.

We have

advertised

the

project

for

bids

and

expect to select a general contractor within a few weeks.

We expect

to commence

construction on the

project

the beginning of June.

However,

you will

note,

there are certain

structures

that

will

incorporated within the

facility that

will

require prefabrication

before

construction

commences.

This

prefabrication

will

have

occur

site

because

the

size

and

weight

these

structures.

Specifically,

these are the sludge

storage silo and the sludge

receiving bins.

You

can locate these structures on pages 43-47 in Volume I of the specifications.

These

structures

are

required

have

these

essential

dimensions

and

design

characteristics

for

proper

operation

of the

facility.

not

feasible

•to

our

knowledge

change

their

nature,

design,

dimensions

characteristics.

Therefore,

unless you intend

rethse

grant zoning approvals andlor variances

and

issue

permits

build

the

facility

the

location

shown

the

plans

and

specifications, you

should have

objection

our starting prefabrication of the

sludge

storage

silo

and

the

sludge

receiving

bins

site.

important

the

NSSD’s

constituents that the fabrication of these be started very soon, so

to not

materially delay the start ofthe construction of this facility.

Therefore, unless you

advise

of some

reasonable

objection we

intend

start prefabrication of the

sludge

storage

silo

and

the

sludge

receiving

bins

location

the

first

week of

May.

Of course, if you want to

discuss this

or any other aspects ofour application

for permits and zoning

approvals andlor variances,

we are

prepared to discuss

the

matter

at your convenience.

There should be more than enough time

for you

to complete whatever it is you

reasonably need to accomplish so that all requirements you intend to

impose for

issuance ofzoning approvals

and permits

for this project

can be accomplished in

sufficient time for our anticipated construction commencement date.

70.

After Mr.

Jensen

submitted

the

additional

requested

sets

of Plans,

NSSD

heard

nothing from the City until a letter from

Robert Masini was received April

1, 2002,

promising a

response no

later than April 4, 2002.

(A copy ofhis

letter is

attached as Exhibit

17.)

64.

71.

Hearing

nothing,

April

2002,

one

of NSSD’s

attorneys

wrote

Mr.

Masini

inquiring when

a response could

be expected.

(A copy of this

letter is attached hereto

as Exhibit

18.)

72.

April

2002,

NSSD

received

letter

from

Defendant

Russ

Tomlin

dated

April

2002.

In it he indicated that NSSD’s application would follow the Waukegan’s “routine

process.”

He.also

opined

that NSSD’s

Biosolids

Reuse

Project

required

a special

use

permit,

thus taking the position that NSSD met

none of the

12 District

permitted uses,

nor

was

exempt

under

Section

6.3.2.

claimed the

November

19,

2002

Ordinance

prevented

NSSD

from

falling within the utility exemption and from

falling under a permitteduse as a ‘Public utility

and

service uses.”

He mentioned

that

the performance standards

the NSSD had

meet “are those

set

forth in

the General Requirements section of Article

(i.e.

10.1)”

copy

of his

letter

attached as Exhibit

19.)

73.

Mr.

Tomlin

also

that

letter

advised NSSD

that

would

need

request

variance

from

the

height

restrictions

the 12

zone.

Mr.

Tomlin

enclosed

with

his

letter the

fonns for special use and variances to which he referred.

74.

The height limitation in the

district is 60 feet.

The Biosolids Reuse Project will

at its

highest point be

feet, although

most of the proposed facility will be under

the

feet.

The proposed structure as to

height is

materially less than the existing structures surrounding the

Biosolids

Reuse

Project,

including

bluff

that

extends

along

the

entire

area. on

the

West,

Commonwealth Edison Plant

on the North, with two

enormous

smoke

stacks

hovering

440

feet

in the

air together with building

structure up

185

feet tall,

and

cement

plant

and

gypsum

plant

the

South

with

five

silos

between

145

and

160

feet tall.

copy of

the site map

showing these structures

and physical features is

attached as Exhibit 20.)

75.

The

project

was

contracted

for

and

designed

prior

the

November

19,

2001

Ordinances

and

was

submitted

the

IEPA together

with

the

applications

for

permits.

The

manufacturer’s optimal

design is

the one

designed into the NSSD project,

and a different project

redesign

solely

produce

lower

project

height,

could be

accomplished

all,

not

recommended

the

manufacturer

and

patent

holders

this

highly

complex

system

and

equipment.

Years of research and

development have resulted in

this

design as

optimal

terms

of safety and

operational efficiency.

The height of the Biosolids

Reuse Project

a result of the

measurements

of the required equipment necessary to

operate

the process safely

and efficiently.

The

tanks

and

system

operate

largely

through

gravity,

and must

under

the

equipment

design

requirements

higher than they

are narrow, thus

producing the project

height

for the required

project

volume.

Any change in

height

would

also require a

total

and

material

redesign of the

project and resubniission ofthe project for amended permits.

76.

In addition,

order to

meet

the imminent

deadlines

associated

with

the

limited

remaining available landfill, NSSD ordered this

equipment prior to November

19,

2001,

entering

into

contracts

on September

26,

2001,

March 21,

2001,

and

additional

contract

on February

27, 2002.

Equipment has already

been shipped

and

manufactured according to the project design

specifications at a

cost of in

excess of $10,000,000,

Even

if the project could be

redesigned so

that the tanks

and other equipment could

be made wider and

shorter to meet

the

feet

height

requirement, most of the existing equipment would have to

be scrapped, costing $10,000,000

for

equipment that has already been specifically designed for this project.

77.

his

April

4th

letter, Tomlin

also

mentioned the Moratorium Ordinance, stating:

“The moratorium

the

issuance

of any

conditional

use permits

or variations,

however,

the

District

can

certainly

make

its

application

any

time.

Additionally,

the

interests

intergovernmental cooperation, I will recommend to the City Council that it receive

and consider

the District’s request

the ordinary

course of business when

those requests

are referred to

the

City Council

by the Development Commission.”

78.

April

12,

2002,

Mr.

Jensen

responded

and

delivered

Mr.

Tomlin,

under

reservation

of rights,

the NSSD’s

applications

for

special

use

permit

and

variance

with

check for the required

fee of $650.

(A copy ofthis letter is attached as Exhibit

21.)

In his

letter,

Mr.

Jensen reiterated

the

importance

the

NSSD

and

its

constituents

that

this

project

must

proceed without undue

delay, stating

“While we recognize the City’s

interest in

conducting

its

review of these materials,

as previously indicated, it is

important to

the constituents of NSSD and

the NSSD

that

this

project

proceed

without

undue

delay.

look

forward

working

cooperation with

the

city

achieve

resolution

of these matters

manner that

achieves

our

respective objectives.”

79.

April

17,

2002,

Mr.

Tomlin

notified

Mr.

Jensen

that

the

application

for

conditional

use permit was

incomplete.

Mr. Jensen promptly

corrected them and

submitted the

revised

application

April

17,

2002.

(Copies

of these

revised

applications

are

attached

Exhibit 22.)

80.

On April

10,

2002,

the NSSD received a letter

from Mr.

Masini addressed

Mr.

Jensen raising several issues not

relevant

the zoning

and building

permit

issues for NSSD’s

Biosohds Reuse Project.

(A copy of his

letter is attached

as Exhibit

23) Mr. Murray Conzelman

responded to

Mr.

Masini’ s letter on April

15,

2002.

copy of that

letter is

attached

as Exhibit

24.)

The

Building Code

81.

Section

6-26

the

Waukegan

Code

of Ordinances,

Chapter

BUILDINGS

AND

BUILDING

REGUlATIONS

(the

“Building

Code”),

adopts

the

“The

BOCA

National

Building

Code,

Twelfth

Edition,

1993”

(the

“BOCA

Code”)

part

of the

Building

Code.

Section

107.1

ofthe BOCA

Code provides

in relevant part as follows:

An application

shall be submitted to

the

code

official for the following activities,

and

these

activities

shall

not

commence

without

permit

being

issued

accordance with

Section

108.0:

Construct or alter a structure.

82.

Under

the

Des

Plaines

Tri1o~,

NSSD

exempt

from

the

requirement

Waukegan’s

Ordinance

and

the Boca

Code

of obtaining

building

permit

and

paying

fees.

83.

However,

effort

avoid

delay

the

project

arid

attempt

pursue

intergovernmental

cooperation

with

Defendants, NSSD

submitted

completed Application for

Building

Permits

Waukegan

March

12,

2002,

under

reservation of rights.

NSSD

has

supplied all information Waukegan has requested ofit in order to process that application.

84.

Section

6-47 of the

Waukegan Building Code

establishes a schedule of fees to

paid

upon

issuance

of building permits.

Those building permit fees are not due

in advance under

the

Ordinance.

85.

NS SD has requested Defendants determine what fees it would require for building

permit fees.

Counsel

for Waukegan advised NSSD

that Defendants would

consider the request,

but Waukegan has said nothing

ifirther about the amount ofbuilding permit

fees,

if any,

it would

require.

Since submitting its

Building Permit Application the NSSD has not reffised to pay

fees.

In fact, when it submitted

its

application.

NSSD stated that

other to

obtain

building permit

for the project,

as a practical matter it may

pay the fees.

IfNSSD concludes

the building permit

fees Defendants ultimately decide to

assess are unreasonable, NSSD, nevertheless,

intends to

pay

Defendants such building permit

fees imposed under Waukegan’s ordinances, although such fees

may be paid under

a reservation ofrights.

86.

NSSD’s Biosolids Reuse Project is

flill compliance with the BOCA code.

87.

On April 26,

2002, NSSD received a letter from Tomlin aclciowledging receipt of

the

NSSD’s

petition

for

conditional

use

permit

and

height

variation.

copy

attached

Exhibit

25.)

His

letter

demonstrates

the

bad

faith with

which

Waukegan

has

dealt

with

the

NSSD.

Starting with the November

19,

2001

ordinances and

the manner

which

Defendants

are

dealing with

NSSD’s

Biosolids

Reuse

Project,

clear

that

Waukegan

and

Defendants

intend to

drag

out

the proceedings and

have no

intention of granting a building

permit.

Tomlin

advises

his

letter that

his

staff had not

even begun

its review

of the NSSD’s

submittals.

also

evidences

callous

disregard for

the

importance of commencing this

project

soon

possible

scheduling it for

Public

Hearing before the

City’s

Development

Commission

June 11;

2002,

three months

after the EPA

issued permits

to NSSD.

This

was also one

day

shy

of three

months

from

the

time

when NSSD

applied

for

building

permit,

which

but

for

the

November

19, 2001

Ordinances, Waukegan would have beenrequired to promptly grant.

NSSD’S NEED TO COMMENCE CONSTRUCTION IMMEDIATELY

88.

NSSD

must

commence

fabrication

of certain

structures

the

project

site

immediately if the project is to be completed before the available landfill is fiñl.

See Affidavit of

David Speth,

attached.

89.

Following

the issuance of the permits by

the EPA,

NSSD put the project

out

for

competitive

bids

prospective

contractors,

which

will be

received

the NSSD

May

2002.

The

NSSD

Board

scheduled

consider the

bids

and

select

contractor

May

22,

2002

and

issue

its

notice

of award

the successful

bidder on

May

23,

2003.

comply with

legal requirements, the Construction contract is

scheduled to

submitted to the NSSD Board on

June

26,

2002 with issuance ofNotice to

Proceed to

Successful

Contractor on June 27,

2002.

90.

From

the

time

the

notice

proceed

issued

and

construction

able

commence,

assuming

unforeseen

delays,

will

take

approximately

fifteen

months

complete the project to

the point where

system testing

may commence

under the IEPA’s permit

requirements, preliminary to

full operation of the system.

91.

If Waukegan does

not issue

a building permit until

after the Moratorium ends on

November

19,

2002,

construction of the project

would

not

commence until

the Winter months

starting

late

November,

thus

almost

guaranteeing

delay

the

project

and

probable

cost

increases.

This

would

place

the probable

completion of the project

dangerously

the

point at which the NSSD’s present

land fill capacity is

exhausted, with almost no

room for error.

This

delay caused by

Waukegan’s intentional

efforts

block the NSSD project

will mean that

the landfill

in Zion will be at capacity, leaving the NSSD with no

facility to

receive the

area’s

solids.

The public health and safety ofthe region will be

endangered and NSSD will be forced to

incur significant expenses to resolve this

problem.

92.

If NSSD

were required

build the biosolids

reuse

project on

the Zion

site, the

bidding

and

construction process

could

not

commence until

permits

were

issued by

the EPA,

and it would be

sometime in 2003

before

any

bid could even be

awarded to

a contractor to

start

construction of the project.

Any such project

at the Zion property could almost certainly not

completedbefore the NSSD’s present landfill capacity is exhausted.

93.

The

cost

the

Biosolids

Reuse

Project

expected

approximately

$26,000,000,

including

about

$16,000,000

for

construction

the

facility

and

another

$10,000,000

for the

equipment

required

operate

the

process.

Under

Waukegan’s

building

code the

fee that Waulcegan would

assess on

this project

unclear and Defendants have refused

clarify

the

amount

of fees they

would

require.

If the

one

percent of cost

applied

for

the

entire

project

the building permit

fee

would

approximately $260,000.

Such

fee

would

unreasonable

and not related to

any

legitimate

interest of Waukegan

promoting

public health

or public safety.

COUNT I

DECLARATORY

JUDGMENT

THAT NSSD IS

NOT

SUBJECT

TO WAUKEGAN’S

ZONING ORDINANCE

94.

NSSD adopts

and

realleges paragraphs

through

as paragraphs

1. through 93

of this

Count I.

95.

regional

entity

created

state statute

and

serving

its

statutory

purpose,

NSSD may not be

compelled

obtain Waukegan’s

approval, lest it be thwarted

fulfilling

its

statutory

duties

dispose

of wastewater

within

its

region.

Defendants

have

authority

jurisdiction to require NSSD to comply with Waukegan’s zoning ordinance for this project.

96.

a regional entity fulfilling its statutory purpose by constructing and developing

the Biosolids

Reuse

Project,

NSSD

not

subject

the

Waukegan

Building

Code

and

not

subject to paying the fees

demanded ofit for such project under said building code.

97.

A case or controversy exists

between the parties and pursuant

the provisions

§2-701

ofthe Illinois Code of Civil Procedure,

735

ILCS

5/2-701, it

is desirable

and

feasible that

the Court declare the

rights

of the parties.

WHERFORE, NSSD

requests that

The Court enter an order declaring that NSSD

not subject to the Waukegan

Zoning Ordinance.

The Court declare

that NSSD

not

subject to

the Waukegan Building

Code

and

not subject to paying the fees demanded of it for such project under said building code; and

For such other relief as the court deems appropriate.

COUNT II

PRELIMINARY

AND PERMANENT

INJUNCTION ENJOINING DEflNDAT’tTS

FROM IMPOSING

WAUKEGAN’S ZONING ORDINANCE ON THE NSSD~S

BIOSOLIDS

REUSE

PROJECT

98.

NSSD

adopts

and realleges paragraphs

I through

of the Allegations

of Count

Ill as paragraphs

through

112 of this Count IV.

99.

NSSD

has

a protectible

interest

proceeding

with

its

Biosolids

Reuse

Project

without acceding

the Zoning

Ordinance

of Waukegan

and

Defendants,

that

NSSD

has

statutory obligation handle the wastewater needs of the region it serves and dispose of the solids

generated by the wastewater treatment processes.

100.

NSSD would be irreparably harmed ifNSSD

is required to

accede to

Waukegan’s

Zoning Ordinance,

that

it may be thwarted or delayed

fulfillment of its

statutory

mandate

and

required

expend money

comply

with

Waukegan’s

demands

that would

otherwise be

available

serve

the

needs

of its

constituents.

In addition,

NSSD

may

required to

make

alternative arrangements

for disposal of sludge at great expense

to NSSD and its

constituents if it

is delayed from proceeding in

accordance with its time schedule.

101.

NSSD

has no

adequate remedy at

law

in that

it must proceed with

the Biosolids

Reuse Project in a timely manner for it to remain viable.

WHEREFORE, Plaintiff NSSD respectfully requests that:

Enter orders temporarily, preliminarily, and permanently enjoining Waukegan and

the other Defendants

from seeking to impose on NSSD, or otherwise attempting to impose on

NSSD,

any zoning requirements

under the Waukegan Zoning Ordinance or otherwise, relating to

the Biosolids Reuse Project on the property; and

For such other relief as the court deems

appropriate.

COUNT III

DECLARATORY JUDGMENT

—

VESTED RIGHT

102.

NSSD adopts

and realleges paragraphs I

through

101

of the Allegations of Count

II as paragraphs I through 101

this Count Ill.

103.

all

times before November

19,

2001, the NSSD’s status

under

the Waukegan

Zoning

Ordinance

and

the

zoning

applicable

the

property

permitted

the

development

and

construction of the Biosolids

Reuse Project.

NSSD possesses

a clear legal

right

issuance of a

building permit for the Biosolids Reuse Project.

104.

In the

alternative, NSSD

possesses a

clear

legal

right

issuance

of a

building

permit

for the

Biosolids

Reuse

Project on

the Waukegan

property based

the

fact that

even

under the Waukegan Zoning Ordinance

as amended on November

19,

2001,

the Biosolids Reuse

Project

a Permitted Use

under

the Waukegan

Zoning

Ordinance,

and

based

the fact that

NSSD

incurred

substantial

expenditures

regarding

developing

the

Biosolids

Reuse

Project

good

faith

reliance

the Zoning

Ordinance

effect both

before

and

after

November

19,

2001.

105.

Defendants

have

also

asserted

that

NSSD

required

obtain

variance

for

building

height,

even

though

prior

November

19,

2001,

that

requirement

did

not

apply

NSSD

this Biosolids

Reuse Project on the property.

106.

Defendants have

also

asserted

that

the

Moratorium prevents

them

from

issuing

any permits

until November

19,

2002.

107.

NSSD,

good

faith

reliance

the

zoning relating

NSSD

and

the

zoning

classification

of the

property

made

substantial

expenditures

reliance

NSSD’s

rights

develop

and

build the Biosolids Reuse Project

was proposed and permitted by the Agency.

108.

NSSD

has also

entered contracts

with Minergy,

contractors,

and the City of Zion

in reliance on the

zoning classification.

109.

date, Waukegan has refused to

complete its review ofNSSD’s

application

for

a building permit

for the Biosolids Reuse Project and has failed to

issue NSSD

a building permit

for

the

Biosolids

Reuse

Project.

Waukegan

and

Defendants

have

legal

justification

for

refusing

complete the review ofNSSD’s

Application for

a Building

Permit

for

the Biosolids

Reuse Project or for failing to

issue NSSD a building permit for the Biosolids Reuse Project.

110.

NSSD

has

substantially

changed

its

position,

good

faith,

and

has

incurred

substantial

expenditures

in reliance upon the probability ofthe issuance of a building permit.

111.

NSSD has

complied

with

all

lawful requirements

for issuance of the applied

for

building permit by Defendants, or

has

offered to do so,

and

stands

ready

and willing

to do

so.

112.

A case or controversy exists

between the parties and pursuant to

the provisions

§2-701 ofthe Illinois

Code of tivil Procedure, 735

ILCS

5/2-701,

it is desirable

and feasible that

the Court declare the rights of the parties.

WHEREFORE,

NSSD requests that:

The

Court

declare that

NSSD

has

vested

property

right

the

issuance

building permit

to develop the Biosolids Reuse Project on the Property;

The

Court

declare that by virtue of the positions of the parties and

the Waukegan

Zoning Ordinance in effect prior to November 19,

2001,

NSSD

exempt from

the application of

the Zoning Ordinance for the Biosolids

Reuse Project;

the alternative,

the Court

should

declare

that

virtue of the positions of the

parties

and

the

Waukegan

Zoning

Ordinance

effect

prior

November

19,

2001,

NSSD’s

Biosolids

Reuse Project on the property is

a permitted use;

In the alternative, the Court should declare that by virtue of the Waukegan Zoning

Ordinance as it

exists currently,

NSSD’s Biosolids

Reuse

Project on

the property is

a permitted

use;

and

Grant

such other and further relief as this

Court

shall consider appropriate.

COUNT IV

PRELIMINARY

AND

PERMANENT INJuNCTION

ENJOINING DEFENDANTS

FROM REFUSING TO

GRANT NSSD APPROVAL OF THE

BIOSOLIDS REUSE

PROJECT FOR WHICH NSSD

HAS

A VESTED RIGHT

113.

NSSD adopts

and realleges paragraphs

through

112

of the Allegations of Count

III

as paragraphs

through 112

ofthis

Countl’V.

114.

NSSD has

protectible

interest

proceeding

with

its

Biosolids

Reuse

Project

without

acceding

the Zoning

Ordinance of

Waukegan

and

Defendants,

that

NSSD

has

statutory requirement to handle the wastewater needs ofthe region it serves.

115.

NSSD would be irreparably hanned if Waukegan

is not enjoined

from refusing to

permit the NSSD’s

Biosélids

Reuse Project or if

delays

issuance ofpermits

beyond

NSSD’s

schedule

for commencement of the Biosolids

Reuse

Project, in

that

NSSD

will

required to

make

alternative arrangements

for disposal of solids from

wastewater

treatment

at great expense

NSSD

and its constituents.

116.

Granting

the

injunction

will

not

adversely

affect

the

public

interest

and

will

protect the public health and safety of the residents within NSSD’ s service area.

117.

NSSD has

adequate remedy

law

that it

must

proceed with

the Biosolids

Reuse Project in a timely manner for it to remain viable.

WHEREFORE, Plaintiff NSSD respectfully requests that:

Enter orders temporarily, preliminarily,

and permanently enjoining Waukegan and

the other Defendants

from refusing to permit, or delaying

issuance of permitsundenthe

Waukegan Zoning Ordinance or otherwise, relating

to the Biosolids Reuse Project,-and

For such other relief as

the court deems appropriate.

COUNT V

DECLARATORY JUDGMENT

—

IMPAIRMENT

OF CONTRACT

118.

NSSD adopts and realleges paragraphs

through

117 of the Allegations

of Count

IV as paragraphs

through 117

ofthis Count V.

119.

NSSD

entered

into

contracts

with

various

parties,

including

its

contract

with

Minergy

for the

Biosolids

Reuse

Project for

production of glass

aggregate,

reliance

the

Zoning Ordinance prior to November

19, 2001.

120.

The legislation

passed by

Defendants

unconstitutional

impairment of these

contracts,

violation

of the

federal

and

state

constitutional

prohibitions

impairment

contract.

WHEREFORE, NSSD requests that:

The

Court

declare that

the actions

of Defendants have

impaired

the contracts

NSSD,

violation

the

federal

and

state

constitutional

prohibitions

impairment

contracts;

Grant such other and further relief as this Court shall consider appropriate.

COUNT VI

WRIT OF MANDAJSIUS REQUIRING DEFENDANTS

TO ISSUE NSSD

ANY ZONING APPROVALS

AND BUILDING PERMITS

THAT MAY BE REQUIRED FOR THE PROJECT

121.

NSSD adopts and

cealleges paragraphs I

through 120 of the Allegations

of Count

as paragraphs

through

120 ofthis

Count VI.

122.

Defendants have

clear

legal

duty

and

are

required

issue

approvals

the

beneficial Biosolids Reuse Project and

do not have discretion to refuse

to issue the permits.

123.

Defendants

have

refused

complete

their

review

and

issue

the

permits

Waukegan, despite repeated demands.

WHEREFORE, NSSD requests that:

The

Court

declare

that

NSSD

has

vested property

right

the

issuance

of a

building permit to

develop the Biosolids Reuse Project;

The

Court

enter

writ

of mandamus

directing

Waukegan

complete

its

site

review

and to issue permits for the development and

construction ofthe Biosolids

Reuse Project;

and

The Court declare such other and further rights ofthe parties and grant such other

and

further relief as this

Court shall consider appropriate.

COUNT VU

DECLARATORY JUDGMENT

THE BIOSOLIDS

REUSE PROJECT IS A

PERMITTED

USE UNDER THE

ZONING ORDINANCE AND NSSD

IS NOT

REQUIRED

TO OBTAIN

A SPECIAL

USE PERMIT

124.

NSSD

adopts

and realleges paragraphs I through

123 ofthe Allegations of Count

VI as paragraphs

through 124 ofthis

Count VII.

125.

case

controversy

exists

between

the

parties

regarding

whether

NSSD’s

Biosolids

Reuse

Project

permitted use

the

District

under

the

Zoning

Ordinance

and.

77.

pursuant to the provisions of~2-70lof the Illinois

Code of Civil Procedure,

735 ICS

5/2-701,

is desirable

and feasible that the Court declare the rights of the parties.

WHEREFORE, Plaintiff NSSD respectfully requests that:

The

Court

declare

that

NSSD’s

propose

project

permitted

use

the

District

under

the Zoning

Ordinance,

and

NSSD

not

required

obtain

special

use

permit

under Waukegan Zoning ordinance;

and

The

Court declare such other and further rights of the parties and grant

such other

and

further relief as this Court shall consider appropriate.

COUNT

VIII

PRELIMINARY AND PERMANENT INJUNCTION ENJOINING DEFENDANTS

FROM REQUIRING NSSD TO

OBTAIN A SPECIAL USE

PERMIT UNDER

WAUKEGAN’S

ZONING ORDINANCE

126.

NSSD adopts

and realleges paragraphs

through

123 of the Allegations of Count

VU as paragraphs

through

123 ofthis

Count VIII.

127.

NSSD

has

protectible

interest

proceeding

with

its

Biosolids

Reuse

Project

with timely approval by

Waukegan and Defendants,

in that

NSSD

has

a statutory requirement to

handle the wastewater needs ofthe region it serves.

128.

NSSD

would

irreparably

banned

Waukegan

were

allowed

require

special

use permit

under its

Zoning Ordinance for the Biosolids Reuse

Project, in that

NSSD will

delayed

prevented

from

implementing

its

construction

schedule

and

required

make

alternative arrangements

for disposal

of solids

from

wastewater treatment

at great

expense to

NSSD

and

its

constituents.

129.

Granting

the

injunction

will

not

adversely

affect

the

public

interest

and

will

protect the public health and safety ofthe residents within NSSD’s service area.

130.

NSSD

has no

adequate

remedy at

law in

that

must

proceed with

the Biosolids

Reuse Project in

a timely manner for it

to remain viable.

WHEREFORE, Plaintiff NSSD respectfully requests that:

Enter orders temporarily, preliminarily, and permanently enjoining

Waukegan and

the other Defendants from

seeking to

impose on NSSD, or otherwise attempting to impose on

NSSD, any

zoning requirements under the Waukegan Zoning Ordinance or otherwise, relating to

the Biosolids

Reuse Project on the Waukegan property;

and

For such other relief as the court deems appropriate.

Dated:

May 6, 2002

Respectfully submitted,

THE NORTH SHORE

SANITARY DISTRICT

By:______________________

ne ofIts Attorneys

Mark E. Furlane (ARDC No. 0897175)

Michael

J. Hayes

(ARDC No. 01161725)

Francis X.

Lyons (ARDC No. 6199617)

Sheila H. Deely (ARDC No, 6236949)

Gardner, Carton &

Douglas

321 N. Clark Street

Suite 3400

Chicago, IL

60610-4795

Telephone:

(312) 644-3000

Facsimile:

(312) 644-3381

CI-102/22186410.1

STATE

OF ILLThTOIS)

)SS

COUNTY OF

LAKE

)

AFFIDAVIT

David J.

Speth, being first duly sworn on oath, states as follows:

lam

employed

as Vice President of Donohue & Associates,

Inc.

Donohue

and

Associates

has been

engaged by the North Shore

Sanitary

District (“NSSD”) to provide design

and

constructionphase

engineering services,

support ofits plans to replace its

current sludge disposal practice with an

environmentally

beneficial biosolids reuse.

Rather than discard

sludge, NSSD proposes to instead subject its

sludge to

a drying

and melting process which will yield a commercially viable glass product..

I have been informed by Brian Jensen,

General Manager ofthe NS&D, that

NSSD must have

this

new process fully operational by January 22, 2004.

Mr.

Jensen

has

communicated to me

his

estimated construction timeline

for the entire project.

According to Mr.

Jensen,

that

timeline generally includes the

following milestones:

Receive Bids on May 9,

2002; Award Construction

Contract on

May 22, 2002; Issue Notice to Proceed on June 27, 2002;

Construction Substantially

Complete on October 24, 2003;

and Construction Complete on January 22, 2004.

avoid interfering

with

Contractor’s work,

the bin and sludge silo

fabrication should be complete before the Contractor’s Notice to Proceed.

The

Supplier

has identified

that

they will need

weeks

to complete fabrication ofthe

bins

and sludge

silos.

At this time, there is insufficient time to complete the bin and

silo fabrication

before the Contractor’s Notice to Proceed.

For this reason,

it is critical

that the bin

and

silo fabrication begin again immediately,

Any further delay in

immediate commencement ofbin and sludge silo

fabrication will potentially result in a corresponding delay in completion of the Sludge

Drying/Melting Project.

FURTHER A.FFIANT

SAYETH NOT.

Subscribed and

sworn

to before me this 3~~y

ofMay,

2002

NOTARY?LIC

CH02122

1866071

f’~FFJCAL

DOROTHY

BAKER

N~a,y

Public, State

of Illinois

Comrthas,on

Exoiresos/2w2x3

CERTIFICATION

Under penalties

as provided by law

pursuant to

Section

1-109 of the Illinois Code of Civil

Procedure, the undersigned certifies that he

is General

Manager of The North Shore

Sanitary

District, a Defendant herein,

and

its duly authorized agent

in this regard; that he

has

read the

above

and

foregoing Verified Answer To

Plaintiffs Amended Complaint

And Counterclaim

and

that he

has knowledge ofthe relevant

facts related to foregoing,

and that statements set forth

the foregoing instrument are

true and correct, to the best of his knowledge, information and

belief.

Brian Jensen, ~tt.

General Manager

NORTHSHORE

SANITARY DISTRICT

CHO2/22 164213.1

No.

IN THE APPELLATE COURT

OF ILLINOIS

SECOND

DISTRICT

CITY OF WAUKEGAN,

a municipal

corporation, et al,)

Plaintiffs/Appellees,

THE

ILLINOIS ENVIRONMENTAL

PROTECTION AGENCY,

Defendant,

and

THE NORTH SHORE

SANITARY

DISTRICT,

Defendant/Appellant.

)

Appeal from

Circuit Court for

the Nineteenth Judicial

Circuit,

Lake County, Illinois

)

Circuit Number 01

1777

Hon.

Stephen Walter,

Judge Presiding

)

THE NORTH SHORE SANITARY DISTRICT,

)

Counter-Plaintiff7Appellant,

)

CITY OF WAUKEGAN, a municipal corporation, et al.,)

)

Counter-Defendants/Appellees.

MEMORANDUM OF DEFENDANT/COUNTER-PLAINTIFF/APPELLANT

NORTH SHORE

SANITARY DISTRICT IN SUPPORT

OF APPEAL PURSUANT TO

RULE 307(d) OF

THE ILUNOIS

SUPREME COURT

North Shore Sanitary District (“NSSD”) files this Memorandum ofLaw pursuant to S.

Ct.

Rule 307(d),

allowing immediate review of an order

granting or denying a temporary

restraining

order.

NSSD

appeals

an order ofthe Circuit

Court

ofthe Nineteenth Judicial Circuit.

Lake County entered on February

18, 2003,

granting

the Plaintiffs/Counter-

Defendants/Appellees’

motion for temporary

restraining

order

and

denying NSSD’s

Motion for

Temporary Restraining Order.

The motions and appeal

arise from Waukegan’s refusal to allow

approval under

its zoning

and building codes for NSSID’s Project to

proceed.

Introduction

NSSD is a unit of government created by the North Shore Sanitary

District Act, 70

ILCS

2305/0.1,

seq.

(“NSSD Act”), the North Shore Sanitary

District Extension (1st) Act, 70

ILCS

2310/0.01,

et seq.,

and the North Shore Sanitary District Extension (2nd) Act,

11_CS

2315/1,

seq.

NSSD is charged with disposal ofsewage for a population of approximately

350,000 people within its Facility Planning Area boundary,

encompassing the geographic

area

roughiy bordered by Lake Cook Road on the south,

the illinois and

Wisconsin border on the

north, the Tn-State Tollway in the west, and Lake Michigan on the east.

NSSD’s enabling

legislation grants the District specific powers and authority in order to fulfill its duty to protect

the public health ofthe region

it serves through proper wastewater treatment and disposal.

The

NSSD currently

disposes ofsludge bytransporting it to a landfill

located within the District,

and

mixing its sludge with flyash to create

a mixture called “fludge.”

The landfill, however,

quickly reaching capacity and will be filly used up within seven years.

There are

individualmunicipal governments withinthe Facility Pinrining Area,

including Beach Park, Highland Park, Highwood, ICnollwood, Lake Bluff, Lake Forest, North

Chicago, Waukegan, Winthrop Harbor,

Zion,

and Lake County.

NSSD operates three

wastewater treatment plants in Lake County,

Illinois, located in Highland Park,

Gurnee,

and

Waukegan,

all of

which serve the people

ofthe Disthct and

all ofwhich are permitted by

the

IEPA.

NSSD’s three wastewater treatment

plants all generate solids, called sludge, from

wastewater handled by NSSD.

NSSD must dispose of 52,600 tons ofsludge

per year.

To replace the method of landfill disposal, the NSSD seeks to construct on its own

property the Project.

The District’s property

at issue is located within the City of

Waukegan.

That

same property

already houses

a wastewater treatment

and processing plant that serves the

entire sanitary district

region.

NSSD’s Board ofTrustees authorized the Project, having

concluded

it is

the most environmentally responsible

method for the NSSD to meet its sludge

disposal

needs given the less

than

seven year life of

its available landfill.

The Project is

also designed

to serve the entire

region, including Waukegan.

The Project

is designed to

create a usable by-product front the sludge currently landfllled in another

municipality within the District

Service

Area, and theDistrict

has elected to pursue the Project in

order to greatly reduce or eliminate

the need to

landfill the sludge.

This new process applies the

technologic advances to produce an environmentally sound method

disposing ofNSSD’s

sludge for the foreseeable

future,

and produces a saleable by-product, which the TEPA recognizes

is no longer a waste.

In this Project, the sludge will be dried and then used as

both the ffiel

and

the raw material to

manufacture a commercially viable glass or ceramic product, all

hydrocarbons

in the sludge will be eliminated,

and all inorganic

materials, including

all heavy

metals

except mercury, will be

locked into the

glass structure

ofthe

glass

aggregate

end product,

although the mercury will be reduced to

below

quantifiable levels.

The

sludge will be

contained

in silos located on the NSSD’s

own

site, inside the Project building, which

is a covered building,

prior to

beingprocessed for drying and melting in

the

same proposed facility building.

This

case was brought by

the City of

Waukegan against

theNSSD

and the Illinois

Environmental Protection Agency (“Agency” or “IEPA”)

prevent the NSSD from constructing

a beneficial biosolids drying/melting

facility (“the Project”)

on the NSSD’s property within

Waukegan’s

boundaries.

PlaintifD’Counter-Defendant Waukegan is

municipal corporation

located in Lake County, Illinois and an illinois Home Rule unit of government.

The other

Plaintiffs/Counter-Defendants also include members of the Waukegan City Council, except that

Russ Tomlin is the Director ofPlanning and

Zoning for

the City of

Waukegan and Chuck Perkey

is the Director ofBuilding

and Planning for the City ofWaukegan, and an agent of the City of

Waukegan.

The City alleged that the local siting provision of the Illinois Environmental

Protection Act, 415

ILCS

§5/1

et seq.

(“the Act”), required NSSD to

obtain siting approval from

Waukegan prior to IEPA’s issuance ofpermits for the Project to NSSD.

The City also alleged

that the NSSD’s construction ofthe Project violated the City’s zoning and building codes and

sought injunctive

relief to prevent

construction.

The NSSD filed a counter-claim against Waukegan seeking both declaratory and

injunctive relief.

The NSSD’s

action asked the court to

declare that the City’s

zoning and

building codes

not apply to

a regional

governmental

entity, like theNSSD,

in the fulfillment

of its

statutory duty to provide regional public health services.

The NSSD

argued that the

City of

Des Plaines

Trilogy

ofcases controlled and mandated both

preliminary and permanent injunctive

relief.

See

City ofDes Plaines

Metropolitan Sanitary District ofGreater Chicago,

48 Ill. 2d

11, 268 N.E.2d 428

(1971)

(Des .P!aines

.1);

City of

Des Flames v. Metropolitan Sanitary District

ofGreater Chicago,

Ill. 2d 29, 31,

32,

319 N.E.2d 9 (1974)

(Des

Flames J..fl; Metropolitan

Sanitary District of Greater Chicago v.

City of

Des

.Plaines, 63

Ill.

2d 256,

347 N.E.2d 716

(1976)

(Des Plaines 111)

(collectively

“Des Plaines

Trilogy”).

After several motions were filed by the NSSD

and

the

City, the court entered an

order on

June

18,

2002 that granted

NSSD’s Motion for Judgnient on the Pleadings as to Counts I

and II

ofthe Amended.

Complaint (applicability oflocal siting

under the

Act)

and denied this motion as

Counts

through VI of

the

Amended Complaint (applicability ofWaukegan’s building and

zoning

codes).

That order also denied NSSD’s Motion

for Summary Judgment on Counts I and

II ofNSSD’s counter-claim for injunctive

and

declaratory relief.

The court’s order also granted

the IEPA’s Motion to Strike

and

Dismiss Counts I

and

II against as applicable to IEPA.

In each

instance, the Court’s order also found that

to those rulings there was

no just reason for

delaying either the enforcement or appeal or both as provided under Rule 304 of the Illinois

Supreme

Court

Rules.

The

court

also certified

two questions

for interlocutory appeal under Rule

308 ofthe Illinois Supreme Court Rules.

In paragraph 12 ofthe June

18,

2002

Order the Court found:

Pursuant

Supreme Court Rule 308 the Court

expressly

finds that

this

order

involves

question

law

which

there

substantial

ground for difference of opinion

and

that the immediate

appeal

from

that

part

the

order

that

question

may

materially

advance

the

ultimate

termination

the

litigation.

Those

questions

are

the following:

(1)

Whether

under

the

Des

Plaines

trilogy

line

of authority,

the North

Shore

Sanitary

District

exercising

power

within

its

statutory

grant,

such

exercise

subject

zoning

restrictions

imposedby Waukegan,

a host home rule municipality?

(2)

Whether

the

amendments

the

Environmental Protection

Act have over ruled the

Des Flames Trilogy

line of authority under

the facts

this case?

Both

the

NSSD and the City ofWaukegan

filed

appeals

this Court, which are pending

before this

Court under

Appellate

Court

No.

02-02-0635, pursuant

to Illinois Supreme Court

Rules 304,

307

and 308.

This appeal

comes before this Court pursuant to

an other ofthe

Circuit

Court ofthe

Nineteenth Judicial Circuit, Lake

County

entered on February

18, 2003,

granting the

Plaintiffs/Counter-Defendants/Appellees’ motion for temporary restraining order and

denying

NSSD’s Motion for Temporary Restraining Order.

The motions and appeal arise from

Waukegan’s reffisal to allow approval

under its zoning

and

building codes for NSSD’s Project to

proceed.

The NSSD

applied to the EPA

for those permits the Agency deemed necessary to

construct the Project.

The

TEPA, alter

thorough review, issued

all necessary permits

to the

NSSD.

These included permits

from the EPA’s Bureau of Air, issued on March

11,

2002,

and

Bureau ofLand, also issued on March 11, 2002.

Public hearings were held

on both permit

applications by the EPA.

March

11,2002, the EPA

issued air

and

land permits to NSSD

to build

a sludge dryer/melter

facility

on NSSD’s Wastewater Treatment Plant property

Waukegan.

NSSD

promptly filed applications

with Waukegan under

reservation ofrights

for a

building permit

and

thereafter for conditional uses

and

variation. NSSD

submitted

a completed

Application

for Building Permits to Waukegan on March

12, 2002,

stating

that

NSSD

did

not

believe

that it was

subject either to Waukegan’s Zoning or

Building

Ordinances

and

reserving its

rights.

On April

11, 2002 NSSD filed applications with Waukegan under reservation ofrights

for

conditional uses

and

variation as direct by Waukegan

and

also paid the applicable fee.

In these

applications NSSD

sought zoning approval

and

a building permit

for the Project.

Thereafter,

NSSD participated in Public Hearings on its

applications before the Waukegan

Development

Commission

(

“WDC”) under

Waukegan’s Zoning Ordinance.

The

WDC

closed the Public

Hearing

September

10, 2002, voting

at the time to deny/recommend

denial

ofNSSD’s

applications.

On October 18, 2002 the

WDC

gave

its

Findings

and

Recommendations on the

applications

to the Waukegan City Council.

On October 21, 2002, the Waukegan City Council

voted to deny outright NSSD’s applications

for zoning

approvals

to proceed with the Project.

NSSD

filed

its Verified Answer

and

Second Amended Counterclaim against Waukegan

on December

10,

2002, both declaratory

and injunctive relief as well as

judicial review ofthe

administrative record and

Waukegan’s

zoning decisions.

The NSSD’s action asked the court to

declare that the City’s outright

refusal to allow NSSD to proceed

with the

Project under

any

circumstances exceeded Waukegan’s Home Rule Power under under

The

City ofHighland Park

The County of Cook,

37111.

App.

(2d Dist.

1975);followed by The

Village ofQakBrook

The County ofDu Page,

173

Ill.

App.

3d 490 (2d fist.

1988);

Schillerstrom

Homes, Inc.

The

City of

Naperville,

198

Ill.

2d 281; 762 N.E.2d 494; 260

Ill. Dec.

835

(2001);

Villagtof

Bolingbrook

Citizens

Utilities Co.

ofillinois,

158

Ill. 2d

133,

138

(1994); and

Kalodimos v.

Village ofMorton

Grove,

103

fll. 2d 483,

501

(1984);

and

the Des Plaines Trilogy.

The

legislative history ofthe Illinois Constitution states:

If a home

rule unit attempts

to exercise a

power or to

perform a function which is

not within the

scope of the

cant contained in Subsection 6(a)—i.e., if the action

does not

pertain to the government and affairs ofthe

home

rule unit—Dillon’s

Rule would continue to apply,

and the exercise or

performance

would be void

unless authorized by statute or by

another

provision ofthe

1970 Constitution.

Constitutional Commentary toIll.

Const., Art.

7. Sec.

The

air permit for the Project issued by the

Illinois

EPA

is a permit to construct only,

and

inter cilia

subject to

Standard Condition

No.

1, which states:

The following conditions

are applicable unless superceded by special condition(s).

Unless this permit has been

extended or it

has

been voided by a newly issued

permit, this permit will expire

one year

from the date of issuance, unless a continuous

pro~amofconstnction

or development on this

project has

started by

such

time.

To avoid the lapse of its Air Permit, NSSD attempted to start construction on the Project until

such time as the legal

status of the Project was decided.

Waukegan physically prevented this by

impeding access to NSSD’s facility by its contractors

and threatening them.with arrest,

and. the

parties filed

cross motions

for

temporary restraining orders.

Waukegan sought to enjoin

construction and

NSSID sought

to restrain Waukegan from interfering

with construction until

such time as

the Circuit Court could reach the merits.

As it

stands, NSSD’s air permit issued by

the EPA expires

ott March

11, 2003, unless NSSD

can

establish “a continuous

program of

construction or development on

this

project has started by” March 11,

2003.

Ifthe air permit

lapses, NSSD would

then need to reapply

for

a new

air

permit.

On February

18, 2003

the

Circuit

Court heard the parties cross motions for temporary restraining order

and

granted Waukegan’s

motion

and

denied NSSD’s motion.

The court’s decision

was

based on its

ruling

June

18,

2002,

on appeal before

this

Court,

which found that NSSD

was

subject to

Waukegan’s zoning.

NSSD now appeals the

denial

ofthe Court’s

order

granting Waukegan’s

motion

for

temporary

restraining order and the denial of NSSD’s

motion

for temporary

restraining order.

The

parties

then filed the cross motions

for temporary restraining orders that led to

the

Court’s February

18,

2003

order that is the subject of this appeal.

STANDARD

REVIEW

This

appeal presents questions.

of law.

The trial

court

decided the crossmotions for

temporary injunctive relief on the papers without taking evidence.

Questions of law are

reviewed

de novo.

In re Chicago Flood Litigation,

176

Ill.

179,

189, 223

III. Dec. 532,

680

N.IE.2d 265

(1997);

Morris v.

Margulis,

197

111. 2d 28,

35,

257

Ill.

Dec.

656,

754 N.E.2d 314

(2001);

Petrovich v. Share Health Plan ofillinois, Inc.,

188111.

2d. 17,30-31,241111.

Dec.

627,

719 N.E.2d

756

(1999).

ARGUMENT

2t.

Waukegnu’s Regulation

ofNSSD

and

prohibition ofthis Project

beyond

Waukegan’s Rome Rule Power

NSSD

unit

regional

government

that

is established by statute for the purpose of

serving. NSSD’ s regional needs. for

wastewater treatment and

disposal.

The North Shore Sanitary

District Act (“NSSD Act”), 70 ILCS

2305/1,

et seq.,

specifically grants the Board ofTrustees

ofNSSD the power

and authority

to flulfill its duties to the public:

Such board shall provide suitable and

modernly equipped sewage

disposal

works

or plants

for the

separation

and disposal

all

solids

and deleterious matter

from

the liquids,

and

shall treat

and puri~r

the

residue of such

sewage

that

when

flows

into

any

lake, it

will

not

injuriously

contaminate

the waters

thereof.

The

board shall

adopt

any feasible method

accomplish

the

objectfor

which

such

sanitary

district may be created.

ILCS

2305/7

(emphasis

added).

NSSD

meant

its

enabling

legislation

the

exclusive

provider

of wastewater

treatment

services

within

its

territory

(“and no territory shall

included within

more than one sanitary district under this act.”

70 ILCS 2305/1.)

The NSSD

board

of trustees

alone

has

the power

and

authority

provide

those services

under

the

Act

within

the territory

(

the Trustees

‘tshall

exercise

all

powers

and

manage

and

control

all

the

affairs

of the district, and

shall

exercise all

the powers and

manage and control all

the

affairs

andproperty ofthe district.”

ILCS 2305/4(emphasis added).)

The

Circuit

Court failed to follow

this

Court’s holding in

City ofHighlandParkv.

County ofCook,

37 Ill.App.Jd

15,

(1975), where

this

Court examined the limits ofthis

home

rule

authority.

The court held

that

Highland Park

had

exceeded

its

home

rule

power in

the

application of its

ordinance to the

County and

therefore the

County

would be

doing

nothing

illegal by i~oring

the ordinance.

The City claimed it had

authority

enact

the challenged

ordinance governing construction of ahighway under the City’s Home Rule Power. The

Court

did not agree

with

the City’s claim, stating:

“It seems obvious

to us

that this only expanded

home

rule

units power over strictly local affairs, not those involving othermunicipalities or the

county orState.”

This

Court also state±“We

hold

therefore that the City’s second contention

that, under its

“Home

Rule” powers under the 1970 Constitution,

it has the power to and did

enact ordinances requiring its

approval

before the.

County or any other “unit of local

government’

could construct, alter or maintain

a highway within its corporate limits

which

approval has not been obtained,

is without merit”

Id.

This

Court quoted

favorably from an

Illinois

Municipal

Law Treatise:

“A home rule

unit

may exercise

any power and perform any

thnction

‘pertaining

to its government and affairs.’

The government

and affairs

language

was

clearly intended

a limit on home rule powers.”

Id. at

24.

The Court then noted

that:

These

ordinances,

in effect,

require not only persons

and corporations but “any

unit

oflocal government” other

than

itself, to obtain the approval ofthe City

Council before commencing any “installation”...11 held valid and applied

to the

factual

situation present in the case at bar,

they

are

intended to

and

will affect the

affairs of the County, the State

and

other municipalities

and,

our

opinion,

therefore

are

not, as

they must be, limited to the City’s

own

affairs.

Id.

at25,

Highland Park,

this Court

recognized that the analysis of the Home Rule Power must

considered before injunctive relief can

lie

for enforcement of a

municipality’s

ordinance

against another governmental entity.

The detemiinative issue

is whether as applied to the case at

hand,

the

municipal entity

regulated only strictly local affairs

or whether predominantly

regional

interests

were involved.

I~oring

Highland Par/c

the

Circuit

Court

held

that

the Municipal Code

gave the City

presumption ofharm

that

required no fUrther legal analysis.

The court rejected NSSD’ s

argument that

the court needed to first determine whether Waukegan’s actions

in stopping NSSD

from proceeding

with

construction ofthe Project were beyond and an

abuse

ofWaukegan’s

Home Rule Power under Section 6(a) ofArticle

VII

of the Illinois Constitution.

The trial court erred by not determining whether NSSD

would be doing something illegal

if it proceeded with construction ofthe Project in Waukegan over Waukegan’s objection.

See

The

City ofHighland Park v.

The County of Cook,

111.

App.

(2d Dist.

1975);

followed

The

Village

Oak Brook v.

The

County ofDu Page,

173

Ill.

App. 3d 490 (2d Dist.

1988).

The

legislative

history of

the illinois Constitution

states:

If a home rule

unit

attempts to exercise a power or to perform

a function which is

notwithin

the scope of the

~arit

contained

in Subsection

6(a)—i.e., if the action

does not pertain to the government

and affairs ofthe home rule unit—Dillon’s

Rule would continue to apply,

and the exercise or performance would be void

unless authorized by statute orby

another provision of the

1970 Constitution.

Constitutional Commentary to Ill. Const.,

Art.

Sec.

Under the Illinois Constitution the drafters viewed

sewage treatment as requiring

regional rather

than local regulation,

and

it is one of

only three

examples identified.

NSSD’s

statutory

purpose

and

authority

derives

from

the constitutionally recognized regional

importance

of sewage

treatment

in the minds of the committee responsible for the home rule power

and

its

limits

in the Constitution.

The Local Government

Committee ofthe

constitutional

convention

reported,

apparent

agreement, that

‘Control ofair and water pollution,floodplains andsewage treatment

are often cited as important examples ofareas requiring regional or statewide

standards and controls.

Record ofProceedings, Sixth Illinois

Constitutional

Convention

1642(hereafter cited as Proceedings).) Similar sentiment was

expressed,

without

disagreement, in debates on the convention

floor.”

(emphasis added.)

Des Plaines .W

III. 2d

256,

at 260-61.

NSSD serves eleven home

rule municipalities,

including Waukegan,

and over 350,000

constituents, all

ofwhom

are impacted

Waukegan’s

actions.

While

some 42

ofNSSD’s sludge

is produced at NSSD’s existing Waukegan plant,

the rest

originates from other municipalities

within

the NSSD

texttoiy.

Every home rule

municipality and every constituent

within the NSSD,

and every

one

affected

by the NSSD

landfill, is directly impacted by Waukegan’s actions

prohibiting

NSSD

from building

the Project.

The

Circuit

Court

also i~ored

the Illinois Supreme Court’s holdings that have fUrther

developed

this Court’s

Home Rule analysis under

Highland Park

Schillerstrom

Homes,

Inc.

The

City ofNaperville,

198

Ill. 2d 281; 762 N.E.2d.494;

260

Ill. Dec.

835

(2001), the

Court

outlined the test for determining the limits of a

municipality’s

exercise ofits

home rule power,

stating:

This

court

has fonnulated a three-part inquiry

for evaluating the

constitutionality

of exercise ofhome rule power. First, we must determine whether the disputed

exercise of local government power falls within section 6(a)-that is, whether the

local government’s activity is

a fUnction

pertaining

to its government

and

affairs.

John Sexton

Contractors

Co., 75111.

2d at

508. If so, we must determine whether

the General Assembly

has

preempted the use ofhome rule powers

this

area.

John

Sexton Contractors Co.,

75111. 2d

at 508. If not, we then must determine

“the proper relationship”

between the local ordinance

and

the state statute.

John

Sexton Contractors Co.,

75 fll. 2d at

508. 762 N.E,2d 494, 498.

Waukegan has stopped NSSD

from pursuing

the Project under any conditions.

To detennine the

limit

ofWaukegan’s exercise ofhome

rule

power against NSSD in

this

case, the

first two

Schillerstrom Homes, Inc.

inquiries

are to

be made before proceeding to

the

third

inquiry.

The

first

Schillerstrom Homes, Inc

inquiry requires the court to determine whether the

dispute

addresses local, rather than state or

national

problems.

Kalodimos v.

Village ofMorton Grove,

103

Ill. 2d 483, 501

(1984), the court

adopted

this

test

addressing

that

inquiry, stating

follows:

Whether a

particular

problem is ofstatewide rather than local

dimension must

be decided

not on the basis of a specific

formula or listing

set

forth in the Constitution but

with

regard for the nature

and

extent of theproblem, the units of government which have the

most vital interest

solution,

and

the role

traditionally

played by local and statewide

authorities in dealing with it.

The analysis is not

just

ofthe Orrlin2nce facially, but also as to

its

application in a

given

case.

See also

Village ofBolingbrookv.

Citizens Utilities

Co.

illinois,

158111. 2d

133,

138 (1994).

All ofthese cases recognize

that

aHome Rule Municipality does not have

unbridled authority

regulate another governmental entity serving regional interests within

and

pursuant to

its

express

statutory

authority.

The 1981 Amendment ofthe

Illinois

Environmental Protection Act by S.B.

172

Did

Not Overrule Applicable Supreme Court Authority or the

Highland

Park

case

Waukegan claims

thatthe amendment to Section 39(c) ofthe

Environmental

Protection

—

r’J

i~rn

p~it

nozuer.

~mer,

Village

Carpentersville,

the

Court confirmed

the

case was about preemption, stating:

“At the

core of

~.ctmandates that NSSD must obtain zoning approvals from Waukegan without regard to any

Home Rule Power analysis because it claims there now exists a special rule

and

analysis for

~ases

in which a permit

has

been issued by the

IEPA,

such as in

this

case,

citing

The

Village of

Carpentersville v. PCB,

135

Iii. 2d 463, 469

(1990).

The Circuit Court not only relied on that

argument to hold that the

Des Plaines Trilogy

has

been overruled by the Legislature in the

amendment ofSection 39(c) in the prior pending appeal, but in the instant order the Circuit Court

~owapplies the same conclusion to overrule the requirement ofconducting aHome Rule

Analysis under

Highland Park,

Bolingbrook; Kalodimos or Schilerstrom Homes.

The

Des

Flames

Trilogy

cases were not decided based on preemption ofthe Act.

Rather, they were

decided at step one ofthe analysis used in these more recent cases,

i.e.,

whether the local

entity

was engaged in a valid exercise ofHome Rulepowerpertaining to

its government and

affairs.

The Circuit Court’s holding and reasoning is flawed.

The amendment to Section 39(c)

was aimed at prior case law thathad held that the Environmental Protection Act had preempted

zoning by non home

rule

municipalities.

It neither addressed the

DesFlames Trilogy,

whichwas

not based on preemption by the Act,

nor is there any indication the amendments to

Section 39(c)

were meant to create an IEPA permit exception to

the analysis required under

Bolingbroolc

Kalodimos, or Schilerstrom Homes.

No case has ever suggested such a distinction in the Home

Rule analysis simply because it concerned issuance of an IEPA permit holder.

Rather, in

Village

ofCarpentersville,

the Court confinned the case was about preemption, stating:

“At the

core of

this

appeal is the question ofwhether a village zoning ordinance

is preemptedby a requirement

set forth in a permit issued by the Environmental Protection.Agency (Agency) underthe

provisions of the Environmental Protection Act..”

135

Iii. 2d

463,

465.

13~

Significantly, in

The

Village ofCarpentersville v.

PCB,

135

Eli. 2d 463, 469 (1990), the

Court noted that the Illinois Environmental Protection Act was amended between 1981

and 1987

to remove the burden from the applicant to

show zoning compliance.

After the amendment the

Act simply eliminated preemption, by stating that any permit issued did not “relieve an applicant

from meeting and securing all necessary zoning approvals from the unit ofgovernment having

zoning jurisdiction over the proposed facility.”

In comparing the respective language ofSection

39(c) before and afterthe amendment, it can be seen that the Legislature removed the burden

from the applicant of showing zoning compliance (“unless an applicant submits proof to the

Agency that the Applicant has secured all necessary zoning approvals.”)

415

ILCS

513

9(c).

Waukegan’s actions stop NSSD’s attempt

to dispose ofits

sludgein amore modem and

environmentally responsiblemanner dead in its tracks.

Waukegan not only denied NSSD use of

its property for the Minergy Project, but advises NSSD that it should be

“built at its plant in

Gumee,” orWaukegan wants NSSD to “build theincinerator in Zion” or simply wants thà NSSD

to continue to

dump sludge in “its own landñll and substantially available other land~ll

space.”

In short, Waukegan is attempting to manage the NSSD Board’s disposal ofits sludge, and not

simply use Waukegan’s zoning process to reconcile

anypurely local interests

This case is the classic example ofa

HighlandPark

situation involving governmental.

entities where it is appropriate for the court to proceed immediately to

the Home.Rule analysis

before enforcing an Ordinance based on merely apresumption ofvalidity.

This is especially

true, where as here; The North Shore Sanitary District Act authorizes the general manager ofthe

NSSD to

seek. an injunction if in his opinion the lack of such an injunction will result in harm to

the sewer system ofthe NSSD, which opinionwas averred to and filed, with the Court in this.

case;

Under the applicable law an& the proper legal analysis, the Circuit Court acted.

14.

erroneously when it granted Waukegan’s motion for temporary injunctive relief and denied

1~’SSD’s

motion for injunctive relief.

Th~

Court’s order of February 18, 2003 should be reversed.

CONCLUSION

For all ofthe foregoing reasons, NSSD respectfblly requests that this Court overturn the

iFebruary 18, 2003

Order ofthe Circuit Court,

denying NSSD’s Motion forTemporary

Restraining Order and granting Waukegan’s Motion forTemporary Restraining Order.

Respectfully submitted,

NORTH SHORE SANITARY DISTRICT

By:,

One ofits attorneys

Michael I. Hayes, Sr. (ARDC No. 01161725)

Francis X. Lyons (A.RDC No. 6199617)

Mark E. Furlane (ARDC No. 896165)

Sheila H. Deely (AR.DC No. 6236949)

Gardner Carton & Douglas LLC

191 N. Wacker Drive,

Suite 3700

Chicago, IL

60610-4795

Telephone:

(312)569-1000

Facsimile:

(312) 569-3000

1 &

BEFORE THE ILLINOIS POLLUTION CONTROL

BOARD

OF THE STATE OF ILLINOIS

NORTH

SHORE

SANITARY DISTRICT,

)

Petitioner,

)

PCB No.

03-146

)

(Permit Appeal)

)

ILLINOIS ENVIRONMENTAL

)

PROTECTION AGENCY,

)

Respondent.

)

NOTICE

To:

Fred

Prillaman

Bradley P. Halloran

Mohan, Alewelt, Prillaman & Adami

Hearing Officer

North

Old Capital

Plaza,

Suite

325

Illinois Pollution Control Board

Springfield, Illinois

62701-1323

James R.

Thompson

Center

100 West Randolph Street

Suite 11-500

Chicago, Illinois

60601

PLEASE

TAKE

NOTICE that

I have today

served the RESPONSES

PETITIONER’S REQUEST TO ADMIT ofthe Respondent, ILLINOIS

ENVIRONMENTAL PROTECTION AGENCY, a copy of which is herewith served

upon the attorney for the Petitioner, NORTh SHORE SANITARY DISTRICT.

Respectfully submitted by,

Robb H. Layman

Special Assistant Attorney General

Dated: April

17, 2003

Illinois

Environmental Protection Agency

1021

North Grand Avenue East

P.O.

Box

19276

Springfield, Illinois 62794-9276

(217)524-9137

EXHIBIT

-t--

BEFORE

THE ILLINOIS POLLUTION

CONTROL BOARD

OF THE

STATE OF ILLINOIS

NORTH

SHORE

SANITARY DISTRICT,

)

Petitioner,

)

PCB No. 03-146

)

(Permit Appeal)

)

ILLINOIS ENVIRONMENTAL

)

PROTECTION AGENCY,

)

Respondent.

)

RESPONSES TO

PETITIONER’S

REQUEST TO ADMIT

NOW COMES the Respondent,

ILLINOIS

ENVIRONMENTAL PROTECTION

AGENCY (“Illinois EPA”), by

and through

its attorneys, and pursuant

to 35

Ill.

Adm.

Code 101.618, hereby responds

to the Petitioner’s, NORTh

SHORE SANITARY

DISTRICT (“NSSD”), Request to Admit,

as follows:

Statement

On April

17, 2001, the IEPA received an application from NSSD for an

air

emissions

construction permit (“air permit

application”).

Answer:

The Illinois EPA admits

this

statement.

Statement 2:

true

and correct

copy ofthe first

nine pages ofthe technical support document

filed with the application for an

air

permit

is attached hereto

as Exhibit A.

Answer:

The Illinois EPA admits

this

statement.

Statement

On July 27, 2001, the IEPA issued a

draft construction permit for a sludge

dryer/melter (“draft air permit”).

Answer:

The Illinois EPA denies that

any

kind ofdraft construction permit

was formally

issued, but admits that a draft construction

permit was proposed forissuance on

July 27, 2001.

Statement 4:

September 25,

2001, the IEPA rejected

a demand made by the City of

Waukegan that the hearing on the draft air permit

be canceled in the absence ofa

siting approval issued by the Waukegan City Council.

Answer:

The Illinois EPA objects to

this request on the grounds that the information is

neither relevant nor calculated to lead to relevant information that relates to

the

subject

matter

of this proceeding.

Statement

On December 6, 2001, the City of

Waukegan, its mayor and members ofits

city

council filed a Verified Complaint for Injunctive

and

Declaratory Relief in the

Circuit Court of Lake County against the fllinois Environmental Protection

Agency (“IEPA”) and the North Shore

Sanitary

District (“NSSD”), which

was

given case

number 01CH1777

(“circuit court lawsuit”).

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neitherrelevant nor calculated to lead to relevant information that relates to the

subject matterof this proceeding.

Statement 6:

Attached as exhibits

to the complaint

in the circuit court lawsuit were copies of

the

air

permit

application

and the

draft

air

permit.

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to

lead to relevant information that relates to

the

subject matter ofthis proceeding.

Statement 7:

Counts I through VI of the complaint sought, inter alia, to stop the issuance ofany

permit by the IEPA withoutproof oflocal siting approval and Counts VII through

X ofthe complaint sought, inter alia,

to stop the construction ofthe project

without first obtaining building/zoning approvals.

Answer:

The Illinois

EPA objects to this request on the grounds that the information is

neither relevant nor calculated to

lead to relevant information that relates to the

subject matter ofthis proceeding.

Statement 8:

On February 27, 2002, the circuit court dismissed the lawsuit on the grounds that

the plaintiffs “have no standing to

seek a Court intervention on these issues at this

time,” namely prior to the issuance of a permit.

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to lead to relevant information that relates to the

subject matter ofthis proceeding.

Statement

191:

March 11,2002, the IEPA issued a construction permit to NSSD, a true and

correct copy ofwhich is attached as Exhibit A to the Petition for Permit Review.

Answer:

The Illinois EPA admits that a construction permit was issued to NSSD on March

11, 2002 and that the

copy ofthe construction permit referenced as Exhibit A in

the Petition forPermit Review is a true and accurate copy ofsaid permit.

Statement 1101:

On April

15,

2002, the City ofWaukegan filed a motion for leave to reinstate its

lawsuitby filing an amended complaint.

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to lead to relevant information that relates to the

subjectmatter ofthis proceeding.

Statement

1111:

The City

 ofWaukegan

was subsequently granted leave to file an amended

complaint.

Answer:

The Illinois EPA objects to this requeston the grounds that the information is

neither relevant nor calculated to leadto

relevant information that relates to the

subject matter ofthis proceeding.

Statement

1121:

On May 7, 2002, NSSD filed its Verified Answer and Counterclaims of

Defendant North Shore SanitaryDistrict to Waukegan’s Amended Complaint, a

true and correct copy ofwhich is attached hereto as Exhibit B.

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to lead to relevant information that relates to the

subject matter ofthis proceeding.

Statement

13:

On June 18, 2002, the Circuit Court ofLake County dismissed the circuit court

lawsuit

with respect to local siting approval issues.

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to lead to

relevant information that relates to the

subject matter ofthis proceeding.

4’

Statement 1141:

Furthermore, on June 18, 2002, the circuit Court ofLake County found that the

Des Plaines trilogy ofcases relied upon by NSSD for its

argument that NSSD

exempt from local zoning had been overruled.

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to lead to relevant information that relates to the

subjectmatter ofthis proceeding.

Statement

1151:

The court’s June 18, 2002, rulings have been appealed to the Illinois Appellate

Court,

Second District, where the appeal remains pending.

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to lead to relevant information that relates to

the

subject matter ofthis proceeding.

Statement 1161:

On February 18, 2003, the Circuit Court ofLake County entered a temporary

restraining order against NSSD from “beginning any construction activity on the

subject site in an effort to construct the facility at issue.”

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to lead to relevant information that relates to the

subject matter ofthis proceeding.

Statement

1171:

On March

2003, the Circuit Court of LakeCounty converted the temporary

restraining order into a preliminary injunction.

Answer:

The Illinois EPA objects to this request on the grounds that the information is

neither relevant nor calculated to lead to relevant information that relates to the

subject matter ofthis proceeding.

Statement 118:

Attached hereto as Exhibit C

is a true and correct copy ofthe Memorandum of

Defendant/Counter-Plaintiff’AppellantNorth Shore Sanitary District in Support

ofAppeal Pursuant to Rule

3 07(d) ofthe Illinois Supreme Court.

Answer:

The Illinois

EPA objects to thisrequest on the grounds that the information is

neither relevantnor calculated to lead to

relevant information that relates to the

subject matter ofthis proceeding.

Respectfullysubmitted by,

ILLINOIS ENVIRONMENTAL PROTECTION AGENCY

Special Assistant Attorney General

Dated: April 17, 2003

Illinois Environmental Protection Agency

1021 North Grand Avenue East

P.O. Box 19276

Springfield,

 Illinois 62794-9276

(217)524-9137

CERTIFICATE OF SERVICE

I hereby certif~r

that on the

17th day ofApril, 2003, I did send, by First Class Mail

with postage thereon fully paid

and deposited into the possession ofthe United States

Postal Service, the RESPONSES

PETITIONER’S REQUEST TO ADMIT

ofthe

Respondent, ILLINOIS ENVIRONMENTAL PROTECTION AGENCY, a copy of

which is herewith served upon the following persons:

Fred C. Prillaman

Bradley P. Halloran

Mohan, Alewelt, Prillaman & Adami

HearingOfficer

North Old Capital Plaza, Suite 325

James R. Thompson Center

Springfield,

Illinois

62701-1323

100 West Randolph Street,

Suite 11-500

Chicago, Illinois

60601

The Respondent has also faxed a true and correct copy ofthe same instrument on this

date to the Petitioner’s attorney.

Robb H. Layman

“

Special Assistant Attorney General

This filing is submitted on recycledpaper.