ILLINOIS POLLUTION CONTROL BOARD
May 6, 2004
PEOPLE OF THE STATE OF ILLINOIS,
Complainant,
v.
ECONOMY PLATING, INC., an Illinois
corporation,
Respondent.
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PCB 97-69
(Enforcement - Air)
OPINION AND ORDER OF THE BOARD (by N.J. Melas):
Today’s order imposes a remedy in this air enforcement matter. On October 10, 1996,
the Office of the Attorney General, on behalf of the People of the State of Illinois (People), filed
a complaint against Economy Plating, Inc. (Economy Plating). The People amended the original
complaint twice. The Board accepted the second amended complaint on November 21, 2002.
The complaint contained a total of five counts, alleging that Economy Plating constructed a hard
chrome electroplating tank with one fume scrubber without a permit, operated seven tanks
without a permit, failed to file annual emission reports, violated special operating permit
conditions, and failed to meet the initial certification requirements.
The Board’s August 21, 2003 order granted the People’s motion for summary judgment
on all five counts of the complaint, finding Economy Plating in violation of the Illinois
Environmental Protection Act (Act) as the People alleged. The order also directed the parties,
either at hearing or in briefs, to address the Section 33(c) factors and propose a civil penalty, if
any, supporting their position with facts and arguments that address any or all of the Section
42(h) factors. Economy Plating has not responded to the Board’s order or the People’s brief in
support of a remedy. A party that fails to respond to a motion is deemed to have waived any
objection to the granting of the motion. 35 Ill. Adm. Code 101.500(d). The Board finds
Economy Plating has waived any objection to the People’s arguments.
In the following paragraphs, the Board discusses the procedural background, applicable
statutes, facts deemed admitted, and Economy Plating’s arguments and the Board’s analysis
regarding an appropriate remedy. Finally, the Board orders Economy Plating to pay a civil
penalty of $5,000 and cease and desist from further violations of the Act and Board regulations.
PRELIMINARY MATTER
On December 5, 2003, the People filed a brief in support of a remedy. In the brief, the
People analyzed the Section 33(c) and 42(h) factors and asked the Board to impose a $5,000 civil
penalty and order Economy Plating to cease and desist from plating operations and close the
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facility by June 2004. In support of the argument that Economy Plating is undergoing financial
difficulties and will close within a year, the People referred to Exhibits A and B.
The People did not attach the exhibits to the brief. At the request of Board Hearing
Officer Brad Halloran, the People submitted the exhibits on April 1, 2004. Exhibit A is a letter,
dated January 17, 2003, from Economy Plating to the People stating that Economy Plating does
not have the ability to pay a significant fine and references three tax returns that were not
included in the exhibit. Exhibit B is a letter, dated June 2, 2003, from Economy Plating to the
People negotiating a settlement including how and when Economy Plating intends to close the
facility.
The Board cannot consider either of the exhibits as proof of the facts they contain. The
Exhibit A letter regarding Economy Plating’s financial status is not supported by the tax returns
to which it refers. The Exhibit B letter proposes a settlement. Matters relating to offers of
settlement or compromise are generally inadmissible.
Suriano v. Lafeber, 324 Ill. App. 3d 839,
850, 756 N.E.2d 382, 391 (1st Dist. 2001). Therefore, the Board cannot consider the facts
contained in Exhibits A and B.
PROCEDURAL BACKGROUND
On May 22, 2003, the People moved to deem admitted facts alleged in the second
amended complaint. On June 19, 2003, the Board granted the motion. On June 30, 2003, the
People moved for summary judgment on all five counts. On August 21, 2003, the Board
granted the People’s motion for summary judgment, finding that Economy Plating violated
Sections 9(a), (b), and 9.1(d)(1) of the Act and Sections 201.142, 201.143, 201.302, 201.144,
254.102(c), and 254.402 of the Board’s air pollution regulations as alleged in the People’s five-
count amended complaint, and directed the parties to hearing on the remedy. 415 ILCS 5/9(a),
(b), and 9.1(d)(1) (2002); 35 Ill. Adm. Code 201.142, 201.143, 201.302, 201.144, 254.102(c),
and 254.402.
Board hearing officer Brad Halloran scheduled a hearing for December 23, 2003.
Attorney for Economy Plating, withdrew his appearance on November 5, 2003. The hearing
officer, together with the parties, cancelled the hearing. The hearing officer indicated in orders
dated November 26 and December 31, 2003, that he had advised Mr. Koerner, the President of
Economy Plating, that the corporation must be represented by an attorney.
The People filed a brief in support of a remedy on December 5, 2003. To date, no
attorney has filed an appearance on behalf of Economy Plating. Economy Plating has not
appeared through an attorney since November 5, 2003, or responded to the People’s motion to
deem facts admitted, the motion for summary judgment, or the brief in support of remedy.
APPLICABLE STATUTORY LANGUAGE
Section 33(c) of the Act provides that in making orders and determinations in
enforcement actions, the Board must consider facts relating to the following five factors:
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(i)
the character and degree of injury to, or interference with the protection of
the health, general welfare and physical property of the people;
(ii)
the social and economic value of the pollution source;
(iii)
the suitability or unsuitability of the pollution source to the area in which
it is located, including the question of priority of location in the area
involved;
(iv)
the technical practicability and economic reasonableness of reducing or
eliminating the emissions, discharges or deposits resulting from such
pollution source; and
(v)
any subsequent compliance. 415 ILCS 5/33(c) (2002).
Section 42 of the Act addresses civil penalties. The Act provides that after the Board
finds a violation, the Board must consider five factors in determining whether or not to impose a
civil penalty and the amount of the penalty, if any:
(1)
the duration and gravity of the violation;
(2)
the presence or absence of due diligence on the part of the violator in
attempting to comply with requirements of this Act and regulations
thereunder or to secure relief therefrom as provided by this Act;
(3)
any economic benefits accrued by the violator because of delay in
compliance with requirements;
(4)
the amount of monetary penalty which will serve to deter further
violations by the violator and to otherwise aid in enhancing voluntary
compliance with this Act by the violator and other persons similarly
subject to the Act; and
(5)
the number, proximity in time, and gravity of previously adjudicated
violations of this Act by the violator. 415 ILCS 5/42(h) (2002).
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FACTS DEEMED ADMITTED
Economy Plating owns and operates an electroplating facility located at 2350 N. Elston
Avenue, Chicago, Cook County. At the facility, Economy Plating operates seven hard chrome
electroplating tanks. Mr. Victor Koerner is the President of Economy Plating. Four of the tanks
are controlled by centrifical mist eliminators, and three are controlled by fume scrubbers with
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Section 42(h) of the Act (415 ILCS 5/42(h) (2002)) was amended by P.A. 93-575, effective
January 1, 2004. The amendments establish that the economic benefit from delayed compliance
is the minimum penalty to be imposed by the Board. Because the record in this proceeding was
complete before January 1, 2004, the Board does not apply the amended Section 42(h) of the Act
in determining the appropriate penalty in this matter.
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composite mesh pads. One glass bead blasting operation at the facility is controlled by a
baghouse. Economy Plating also operates one polishing lathe and one gas-fired boiler.
Economy Plating had a permit (no. 73031926) to operate six of the electroplating tanks,
six scrubbers, one polishing lathe, and one gas-fired boiler, effective from May 22, 1973 until
May 7, 1983. Economy Plating was reissued the operating permit (no. 73031926), valid from
March 31, 1998 through March 31, 2003.
In the June 19, 2003 order, the Board determined that Economy Plating admitted the
material allegations set forth in the following paragraphs.
Operating Without a Permit
The Board found that Economy Plating violated Section 9(b) of the Act (415 ILCS 5/9(b)
(2002)) and Section 201.144 of the Board rules (35 Ill. Adm. Code 201.144) by operating six
hard chrome electroplating tanks, six polishing lathe and a gas-fired boiler without an operating
permit between March 7, 1983 and November 30, 1995. Economy Plating violated these same
provisions for operating a glass bead blasting operation with baghouse for the seventh scrubber
between May or June of 1973 through November 30, 1995. Am. Pet. at 6. Economy Plating
violated Section 9(b) of the Act and Section 201.143 of the Board rules (35 Ill. Adm. Code
201.143) by operating a seventh hard chrome electroplating tank with a seventh fume scrubber
without the required new source operating permit from the Agency between May or June of 1973
through November 30, 1995.
Id
.
Construction Without a Permit
The Board also found that Economy Plating violated Section 9(b) of the Act (415 ILCS
5/9(b) (2002)) and Section 201.142 (35 Ill. Adm. Code 201.142) of the Board’s rules by
constructing a hard chrome electroplating tank with a fume scrubber without an Agency
construction permit. Am. Pet. at 9.
Failure to File Annual Reports
The Board found that Economy Plating violated Section 9(a) of the Act (415 ILCS
5/9(a)) and Section 201.302 of the Board’s regulations (35 Ill. Adm. Code 201.302) by failing to
timely file annual emission reports in 1992 and 1994. Am. Pet. at 12. Economy Plating filed the
1992 annual emissions report to the Agency on October 4, 1993, and the 1994 annual emissions
report on February 29, 1996. The respective deadlines were October 1, 1993, and May 1, 1995.
Violation of Special Operating Permit Conditions
The Board found that Economy Plating violated federal Clean Air Act regulation 40
C.F.R. 63.342 (c)(1)(ii) and conditions 1(b) and 1(c) of operating permit #73031926 by failing to
maintain compliance with the chromium emission limit during a special permit compliance test
on November 25, 1997. Economy Plating failed to establish required testing parameters in
violation of federal Clean Air Act regulation 40 C.F.R. 63.343(c)(1)(ii) during a compliance test
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performed on February 16, 2001. Finally, Economy Plating violated 40 C.F.R. 63.346(b)(1) and
(8) and special operating permit condition 4(b) for failing to maintain complete records of
inspection, maintenance and repairs for the add-on air pollution control equipment. Am. Pet. at
19. As a result, Economy Plating violated Section 9(b) of the Act, and by violating federal
regulations, Economy Plating violated Section 9.1(d)(1) of the Act.
Certification Violation
Finally, the Board found that Economy Plating conducted an initial performance test on
February 16, 2001. The test results demonstrated that Economy Plating failed to comply with
the performance test requirements as set out the operating permit in violation of Section 9(b) of
the Act and special operating permit condition 5 (a through i). Additionally, Economy Plating
violated 40 C.F.R. 63.343(b)(1) by failing to comply with the parameters for the February 16,
2001 performance test, thereby violating Section 9.1(d)(1) of the Act. Am. Pet. at 23.
REMEDY DISCUSSION
Having previously found violations, the Board will now determine the appropriate
remedy, including civil penalty, if any. In making a determination, the Board considers the
factors set forth in Section 33(c) in determining the unreasonableness of the alleged pollution
(Wells
Manufacturing Company v. PCB, 73 Ill. 2d 226, 383 N.E.2d 148 (1978)), and the factors
in Section 42(h) of the Act in determining the appropriate penalty (415 ILCS 5/42(h) (2002)).
The People move the Board to impose a $5,000 civil penalty, and order Economy Plating
to cease and desist from plating operations and close the facility within a year. Below the Board
discusses the People’s arguments under each of the Section 33(c) and 42(h) factors and presents
the Board’s findings and reasons for those findings.
Section 33(c) Factors
In determining what kind of remedy is appropriate, the Board considers all facts and
circumstances of record relating to the reasonableness of the respondent’s violations of the Act.
415 ILCS 5/33(c) (2002).
The Character and Degree of Injury to, or Interference With the Protection of the Health,
General Welfare and Physical Property of the People
The People argue that Cook County is a non-attainment area for ozone. The People also
maintain that hexavalent chromium emissions are extremely toxic and carcinogenic, and
therefore, endanger human health, general welfare, and the physical property of the people. As a
result, the People maintain that Economy Plating interfered with the public welfare by not
providing information necessary to monitor and control air pollution sources and their control
equipment.
The Board finds that Economy Plating did not comply with several permit requirements
for a period of more than 12 years, and in one instance more than 20 years. Further, the record
shows that Economy Plating exceeded the federal limits for chromium emissions on two
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occasions. The first occasion occurred on November 25, 1997, in conducting an initial
performance test. The second instance took place on February 16, 2001, in conducting a
compliance test. The Board weighs this factor against Economy Plating.
The Social and Economic Value of the Pollution Source
The People contend that because the facility employs fewer than five people, Economy
Plating has limited social and economic value. The Board does not find any information in the
admitted facts supporting this fact or in regard to the size of the facility or economic value of the
pollution source. The Board finds that Economy Plating has social and economic value as an
employer, but that its value is undercut by its history of non-compliance.
The Suitability or Unsuitability of the Pollution Source to the Area in Which it is Located,
Including the Question of Priority of Location in the Area Involved
The People state that Economy Plating is suitable to its location because it is located in an
industrial area. Again, the Board does not find this information in the record, but finds that
Economy Plating is located in Cook County. The Board finds that if operated in compliance
with the Act, Economy Plating is suitable to the area in which it is located. However, the People
contend that because there exists a threat to human health, it is imperative that Economy Plating
cease and desist operations until it can comply with 40 C.F.R. 63, Subpart N.
The Technical Practicability and Economic Reasonableness of Reducing or Eliminating the
Emissions, Discharges or Deposits Resulting from Such Pollution Source
Next, the People argue it is technically practicable and economically reasonable for the
source to reduce or eliminate emissions because other similarly situated sources have done the
same. The People did not discuss the technical practicability or economic reasonableness of
alternative means that Economy Plating may employ to avoid violating applicable chromium
emissions standards in the future. Because Economy has made no argument to the contrary, the
Board finds that compliance is technically practicable and economically reasonable.
Any Subsequent Compliance
As to subsequent compliance, the record indicates that Economy Plating was reissued an
operating permit from March 31, 1998 through March 31, 2003. The record does not indicate
whether Economy Plating has taken any further initiative to comply with the Act or Board
regulations. The Board weighs this factor against Economy Plating.
Remedy Analysis
After considering the Section 33(c) factors, the Board finds a civil penalty is proper in
this instance. To determine the proper penalty, the Board considers factors listed in Section
42(h) of the Act.
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In addition to a civil penalty, the People request that the Board order Economy Plating to
cease and desist plating operations and close the facility by June 2004. The record does not
support an order requiring Economy Plating to close the facility by a date certain. However, the
Board will require Economy Plating to cease and desist further violations of the Act and Board
regulations. Incidental to the cease and desist order, Economy Plating may have to cease
operations in order to come into compliance.
Section 42(h) Factors
The People’s Arguments
In determining the appropriate amount of civil penalty to impose, the Board considers
any matters of record that may mitigate or aggravate the penalty amount. 415 ILCS 5/42(h)
(2002).
With regard to the Section 42(h) factors, the People argue that Economy Plating operated
six hard chrome electroplating tanks, six fume scrubbers and/or centrifugal mist eliminators, and
one polishing lathe and a gas-fired boiler from March 7, 1983 until November 30, 1995 without a
permit from the Environmental Protection Agency (Agency). The People contend that from May
1973 until November 30, 1995, Economy Plating both constructed and operated a seventh hard
chrome electroplating tank with a fume scrubber and class bead blasting operation with baghouse
also without an Agency permit. The People maintain that Economy Plating has been out of
compliance for more than 20 years and has not yet achieved compliance.
The People next argue that Economy Plating has not demonstrated due diligence in
complying with the permitting requirements and remains out of compliance with the established
procedures for stack testing. The People state that Economy Plating has economically benefited
from its noncompliance by not paying the required permit fees for substantial periods of time.
The People contend a $5,000 penalty will deter Economy Plating from further violating
the Act and associated regulations and aid in future voluntary compliance. The People add that
there is no evidence of previously adjudicated violations of the Act or Board regulations against
Economy Plating.
The People move the Board to impose a $5,000 penalty. The People state that Economy
Plating claims that it has been losing more than $26,000 per year of operation. The People
further state that in a letter dated June 2, 2003, Economy Plating indicated it would close the
plating operation in accordance with applicable regulations within one year. The People refer to
exhibits A and B in support of this argument, but as discussed above, the Board cannot consider
the facts contained in exhibits A and B. The People maintain that a nominal penalty of $5,000 is
adequate in light of the status of Economy Plating’s business and inability to comply with
Section 40 C.F.R. 63, Subpart N.
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2
40 C.F.R. 63 Subpart N, National Emission Standards for Chromium Emissions from Hard and
Decorative Chromium Electroplating and Chromium Anodizing Tanks, includes Sections
63.341-347.
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Penalty Analysis
The Board find that, considered in isolation, the duration and gravity of the violations, the
lack of diligence on the part of Economy Plating, and the economic benefits that Economy
Plating accrued through noncompliance would warrant a substantial civil penalty. The record
clearly shows that Economy Plating operated six of the hard chrome electroplating tanks without
a permit for twelve years. Economy Plating constructed and operated the seventh tank for more
than 20 years. Further, Economy Plating failed to file annual reports on two occasions, and
violated certain special operating permit conditions on two occasions. The special operating
permit condition violations amounted to Economy Plating exceeding the chromium emission
limit during compliance testing on November 25, 1997 and February 16, 2001, and failing to
maintain complete records of inspection, maintenance, and monitoring data. Finally, Economy
Plating failed to meet the initial certification of compliance requirement.
The Board finds the actual harm to the environment was relatively minimal since
Economy Plating emitted contaminants into the environment above the allowable amounts on
only two occasions. Nonetheless, the permit requirement is an essential part of the State’s
enforcement program to protect against damage to the environment and public welfare.
Economy did not display due diligence in attempting to comply with the Act and Board
regulations. The record does not indicate that Economy Plating has applied for the necessary
permits. The record also shows that Economy Plating benefited from avoiding the cost of
permitting. Economy Plating owned and operated six unpermitted chrome electroplating tanks
for twelve years and a seventh unpermitted tank for more than 20 years. The Board weighs these
three factors in aggravation of the civil penalty.
However, the Board also finds that the amount that will serve to actually deter further
violations by Economy Plating and similarly situated entities merits a lesser penalty. Economy
Plating is a small entity. Economy Plating’s most recent operating permit incorporated federal
regulations applicable to small electroplating facilities.
See
40 C.F.R. 63.342(c)(1)(ii).
Additionally, the record shows that Economy Plating has had no previously adjudicated
violations of the Act. The Board finds these two factors serve to mitigate the civil penalty.
Section 42(a) provides for a civil penalty not to exceed $50,000 for violating a provision
of the Act or Board regulation and an additional civil penalty not to exceed $10,000 for each day
during which the violation continues. By multiplying $50,000 times nine (the number of sections
of the Act and Board regulations that respondents are alleged to have violated), a potential civil
penalty of $450,000 is reached.
Add to that sum, a civil penalty of $10,000 a day for each day of noncompliance with
those sections, and the total maximum penalty could amount to a multimillion dollar penalty.
The complainant moves the Board to impose a civil penalty of $5,000.
The Board finds that the People’s requested civil penalty of $5,000 is appropriate. The
Act contemplates the Board assessing a penalty amount that will deter violations by the violator
and similarly situated entities. 415 ILCS 5/42(h)(4) (2002). Accordingly, though the violations
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have been ongoing for several years, a $5,000 penalty will serve to deter a small facility
undergoing financial difficulties like Economy Plating. Further, while the permit requirement is
an essential part of the State’s enforcement program to protect against environmental damage,
the record establishes that Economy Plating emitted contaminants into the environment above
the allowable amounts on only two occasions, amounting to minimal actual harm to the
environment.
CONCLUSION
The Board finds a civil penalty is appropriate and imposes a penalty in the amount of
$5,000. In addition, the Board orders Economy Plating to cease and desist from further violating
the Act and Board regulations.
This opinion constitutes the Board’s findings of fact and conclusions of law.
ORDER
1.
The Board incorporates by reference its August 21, 2003 order granting the Office
of the Attorney General, on behalf of the People of the State of Illinois (People),
summary judgment on all five counts of the second amended complaint. That
order finds that Economy Plating, Inc. (Economy Plating) has violated Sections
9(a), (b), and 9.1(d)(1) of the Act and Sections 201.142, 201.143, 201.302,
201.144, 254.102(c), and 254.402 of the Board’s air pollution regulations. 415
ILCS 5/9(a), (b), and 9.1(d)(1) (2002); 35 Ill. Adm. Code 201.142, 201.143,
201.302, 201.144, 254.102(c), and 254.402.
2.
Economy Plating must pay a civil penalty of $5,000 no later than May 30, 2004,
which is 45 days from the date of this order. Such payment must be made by
certified check or money order, payable to the Environmental Protection Trust
Fund. The case number, case name, and Economy Plating’s social security
number or federal employer identification number must be included on the
certified check or money order.
3.
Economy Plating must send the certified check or money order by first class mail
to:
Illinois Environmental Protection Agency
Fiscal Services Division
1021 North Grand Avenue East
P.O. Box 19276
Springfield, Illinois 62794-9276
4.
Penalties unpaid within the time prescribed will accrue interest under Section
42(g) of the Environmental Protection Act (415 ILCS 5/42(g) (2002)) at the rate
set forth in Section 1003(a) of the Illinois Income Tax Act (35 ILCS 5/1003(a)
(2000)).
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5.
Economy Plating must cease and desist from further violations of the Act and
Board regulations.
IT IS SO ORDERED.
Section 41(a) of the Environmental Protection Act provides that final Board orders may
be appealed directly to the Illinois Appellate Court within 35 days after the Board serves the
order. 415 ILCS 5/41(a) (2002);
see also
35 Ill. Adm. Code 101.300(d)(2), 101.906, 102.706.
Illinois Supreme Court Rule 335 establishes filing requirements that apply when the Illinois
Appellate Court, by statute, directly reviews administrative orders. 172 Ill. 2d R. 335. The
Board’s procedural rules provide that motions for the Board to reconsider or modify its final
orders may be filed with the Board within 35 days after the order is received. 35 Ill. Adm. Code
101.520;
see also
35 Ill. Adm. Code 101.902, 102.700, 102.702.
I, Dorothy M. Gunn, Clerk of the Illinois Pollution Control Board, certify that the Board
adopted the above opinion and order on April 15, 2004, by a vote of 5-0.
Dorothy M. Gunn, Clerk
Illinois Pollution Control Board
