2

2004, PIPE filed a response to the amended motion supporting the Agency’s motion for

emergency rulemaking (Am. Resp.1). On May 19, 2004, CW

3

M filed a response which joined in

the response of PIPE to the Agency’s amended motion for emergency rules, and withdrew its

prior objection to adoption of emergency rules (Am. Resp.2). Also, on May 19, 2004, United

Science Industries (USI) withdrew its response to the Agency’s April 19, 2004 motion for

emergency rulemaking (Am. Resp.3). Finally, on June 2, 2004, the Consulting Engineers

Council of Illinois (CECI) filed its response to the Agency’s April 19, 2004 motion for

emergency rulemaking (Am. Resp.4).

For the reasons discussed below, the Board denies the Agency’s motion for adoption of

emergency rules. First, the Board will summarize the arguments in the Agency’s motion to

adopt emergency rules, and then the Board will summarize the response from IERG. The Board

will not summarize the responses of PIPE, CW

3

M, and USI to the Agency’s original motion for

emergency rulemaking since PIPE and CW

3

M now support the Agency’s amended motion, and

United Science has withdrawn its response. The Board will then summarize the Agency’s

amended motion for emergency rulemaking and the response from PIPE, USI and CECI.

Finally, the Board will review the legal framework for emergency rulemaking before discussing

the Board’s findings in ruling on this motion.

MOTION FOR EMERGENCY RULES

The Agency’s April 19, 2004 motion urges the Board to adopt an emergency rule

pursuant to Section 27 of the Environmental Protection Act (Act) (415 ILCS 5/27 (2002)),

Section 5-45 of the Administrative Procedure Act (APA) (5 ILCS 100/5-45 (2002)), and Section

102.612 of the Board’s procedural rules. 35 Ill. Adm. Code 102.612. Mot. at 1. The Agency

proposed that the Board adopt the text of the proposed amendments to Part 732, and the new Part

734 the Agency had proposed in January 2004, subject to some amendments contained in the

motion. The Agency claims that the Agency is seeking an emergency rule so that the Agency

may “review budgets and applications for payment from the Underground Storage Tank Fund

(UST Fund).”

The Agency maintains that an emergency exists as a result of the Board’s recent decision

in

Illinois Ayers Oil Company v. IEPA, PCB 03-214 (Apr. 1, 2004). In Illinois Ayers, the Board

found that the Agency’s rate sheet for professional services was an improperly promulgated rule.

In the instant motion, the Agency argues that without the use of the rate sheet, there is no

standard methodology for the Agency to use in determining whether costs are reasonable in UST

Fund reimbursement cases. Mot. at 2. The Agency asserts that adoption of the emergency

rulemaking proposal will allow the Agency to review budgets and applications for

reimbursement.

Id

. Without the standard methodology the Agency argues that it cannot review

budgets and applications for reimbursement other than those already approved before the

Board’s decision in

Illinois Ayers.

Id

.

The Agency argues that emergency rules are appropriate because the Board has the

authority to adopt emergency rules to address a situation that: “reasonably constitutes a threat to

the public interest, safety, or welfare.” Mot. at 2, citing 5 ILCS 100/5-45(a) (2002). The Agency

asserts that the inability to approve budgets and application for payment from the UST Fund

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3

constitutes an emergency. Mot. at 3. The Agency argues that the approval of budgets and

payments from the UST Fund “drive[s] the remediation of leaking underground storage tank

(LUST) sites.”

Id

. The Agency maintains that if budgets and applications for reimbursement are

not processed by the Agency, then “remediation of LUST sites will not proceed.”

Id

. The

Agency argues that the fact that unremediated sites poses a threat to the public interest, safety, or

welfare, has been established by the fact that state and federal law requires remediation.

Id

. The

Agency did not cite to any case law in support of its motion.

IERG’s Response

IERG opposes the use of emergency rulemaking in this proceeding. Resp.2 at 4. IERG

distinguishes between the content of the proposed emergency rules “which it does not

necessarily oppose” (

id.

), and whether an emergency exists sufficient to justify use of the

Board’s emergency rulemaking authority. IERG argues that the administrative justifications

propounded by the Agency are not sufficient to establish a threat to the public interest, safety, or

welfare.

Id

. IERG notes that there are numerous cases that discuss the level of justification

necessary to support emergency rulemaking. But, IERG points to the similarities between the

facts in this proceeding and the facts in two recent appellate cases involving emergency

rulemaking.

IERG first argues that the facts here are “strikingly similar” to those in the

Senn Park

Nursing Center v. Jeffrey C. Miller, 104 Ill. 2d 169, 480 N.E.2d 1029 (1984). Resp.1 at 4. In

Senn Park, the appropriateness of an emergency rulemaking by the Illinois Department of Public

Aid (DPA) was at issue. DPA had filed emergency rules to implement a reimbursement

procedure for nursing homes after the circuit court had previously declared the DPA procedure

an illegally promulgated rule.

Senn Park, 104 Ill. 2d at 174. The court invalidated the rule

stating that there was no emergency within the meaning of the APA. The court found that any

emergency “was the result of an avoidable administrative failure to properly enact a rule in

accordance with statutory requirements, and the reasons given by defendant in support of his

finding of an emergency are all tainted by this fact.”

Senn Park, 104. Ill. 2d at 184. The Illinois

Supreme Court affirmed this decision in its review of the case.

Senn Park, 104. Ill. 2d at 186.

IERG next cites to

Citizens for a Better Environment v. PCB, 152 Ill. App. 3d 105, 504

N.E.2d 166 (1st Dist. 1987) (CBE). In CBE, petitioners challenged the existence of an

emergency sufficient to support the Board’s adoption of emergency rules implementing Section

39 (c) of the Act. That Section prohibited deposit of hazardous waste streams in permitted

hazardous waste landfills without specific Agency authorization. The court stated that “the need

to adopt emergency rules in order to alleviate an administrative need, which, by itself, does not

threaten the public interest, safety, or welfare, does not constitute an ‘emergency’.”

CBE, 152

Ill. App. 3d 105, 109. IERG additionally recites that “the court also noted the Board realized that

the administrative problem could have been prevented and that the rules should have been

promulgated years before.” Resp.2 at 5, citing

CBE, 152 Ill. App. 3d at 110.

In summary, IERG maintains that the

Senn Park and CBE cases provide “meaningful”

guidance to the Board with respect to what constitutes an emergency under the APA. Resp.2 at

5. IERG asserts that, here, as in

Senn Park and CBE, there is no emergency. Until permanent

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4

rulemaking is completed, IERG suggests that the best interim course of action for the Agency

may be to rely on the “years of experience in determining the reasonableness of corrective action

costs in reviewing budgets and applications for reimbursement.” Resp.2 at 6.

AMENDED MOTION FOR EMERGENCY RULES

The Agency’s May 18, 2004 amended motion for emergency rules requests that the

Board adopt as emergency rules one new subsection at Section 732.505(d) and Section

732.Appendix D “Allowable Unit Rates.” The Agency requests adoption of these rules in lieu of

those proposed in its original April 19, 2004 motion. Am.Mot. at 4-8.

The Agency reiterates that emergency rules are needed to “provide a standard

methodology for determining the reasonableness of costs” submitted to the Agency. Am.Mot. at

2. The Agency asserts that since the

Illinois Ayers case, the Agency has “struggled to develop” a

new method for reviewing the costs; however, the process has proven difficult.

Id

. The Agency

has resumed processing budgets and applications on a case-by-case basis.

Id

. The Agency

maintains that without rules to govern how to determine reasonableness of costs, the Agency’s

ability to control costs and maintain consistent and fair review is limited.

Id

. Without the

emergency rule, the Agency argues that the UST Fund will “decrease at an even faster rate.”

Am.Mot. at 3. The Agency further asserts that rules will “provide some cost containment

measures by establishing a benchmark for rates via a limited rate sheet and a nationally

recognized construction cost manual.” Am.Mot. at 3. The Agency’s amended motion did not

address any of the case law cited in IERG’s response to the Agency’s original motion.

PIPE’s Response To The Amended Motion

PIPE indicates that it and its members have met with the Agency and the Agency’s

amended motion reflects those meetings. Am.Resp.2 at 1-2. PIPE states that based on the

amended motion PIPE “withdraws its objection to emergency rulemaking and supports” the

proposed Section 732.505(d). Am. Resp.2 at 2. PIPE further states that while PIPE does not

agree that the

Illinois Ayers decision justifies an emergency rule, the Agency’s reaction to the

decision and “the chaos which has resulted from” the Agency’s inability to use the rate sheet,

does justify an emergency rule. Am.Resp.2 at 2.

PIPE argues that emergency rulemaking is in the public interest because the emergency

rule will resolve “an administrative dilemma and [the rule] sets forth public parameters that are

intended to create stability for the UST Fund.” Am.Resp.2 at 4-5. PIPE’s major concern is that

dollars be available from the fund to remediate contaminated sites in the State. Am.Resp.2 at 5.

PIPE agrees with the Agency that the emergency rules are necessary while the regular

rulemaking is pending to ensure that the Agency and applicants are under the same “rules of the

game” when seeking reimbursement. Am.Resp.2 at 6.

PIPE notes that the Agency’s original motion did not provide emergency justification

however, PIPE asserts the proposed subsection (d) does provide emergency justification.

Am.Resp.2 at 6. PIPE maintains that the justification is that the limited subsection will provide a

specific public framework for the regulated community to know what standards the Agency uses

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5

in reviewing reimbursement and budget requests.

Id

. PIPE argues that this situation is similar to

other Board emergency rules wherein the Board “recognized that, in order to avert uncertainty in

the administrative process” emergency rules were justified. Am.Resp.2 at 6-7, siting

Emergency

Rule Amending the State II Gasoline Vapor Recovery Rule in the Metro-East Area, 35 Ill. Adm.

Code 219.586(d), R93-12 (May 20, 1993).

USI’s Response to the Amended Motion

USI supports emergency rulemaking to adopt a new subsection 732.505 (d) that was

introduced in the Agency’s amended motion. Am.Resp.3. USI states that “this new subsection

will provide the Agency with the regulatory framework it claims it needs in order to apply a

standard method of reviewing budgets, corrective action plans and requests for reimbursement

while the rulemaking process proceeds on its normal course before the Board.” Am.Resp.3. USI

believes that numerous conferences between PIPE and the Agency have resulted in a proposed

section 732.505 (d) that is reasonable, practicable and workable, and therefore withdraw its prior

objection to emergency rulemaking.

Id

.

CECI’s Response to the Amended Motion

CECI’s response supports adoption of the Agency’s amended emergency proposal at the

Board’s meeting June 3, 2004. CECI states that it is one of the groups that met with the Agency,

and that the amended proposal will “serve satisfactorily as an interim guide for the Agency’s

decisionmaking.” Am. Resp.4 at 1. While CECI believes some aspects of the proposal “could

be improved,” it suggests that the Board adopt “emergency rules because it is in the public

interest that the Agency be given formal guidelines for determining reasonableness of LUST

costs for reimbursement purposes, and that those guidelines be known to all interested parties.”

Am. Resp. 4 at 2.

LEGAL FRAMEWORK

The Illinois Administrative Procedure Act (APA) sets forth the requirements for

emergency rulemaking in Illinois (5 ILCS 100/5-1

et seq.

(2002)). The Board’s procedural rules

concerning emergency rulemaking quote the APA. The APA defines an “emergency” as:

the existence of any situation that any agency finds reasonably constitutes a threat

to the public interest, safety, or welfare. 5 ILCS 100/5-45(a) (2002).

The courts have reviewed emergency rulemakings filed by agencies, including one case

where the Board adopted an emergency rule. The Illinois Supreme Court in

Senn Park found

that an emergency rule adopted by the Illinois Department of Public Aid (DPA) was invalid

because there was no emergency. The facts surrounding the adoption of the emergency rule by

DPA are very similar to the facts in this proceeding. In

Senn Park, the DPA’s procedure for the

reimbursement of Medicaid services was determined to be an invalid rule.

Senn Park, 104 Ill. 2d

174. DPA then used the emergency rule process to amend the means by which nursing homes

received Medicaid reimbursements.

Senn Park, 104 Ill. 2d at 175. The court found that the

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6

emergency rule was invalid.

Id

. at 184-85. The court found DPA’s arguments unpersuasive

including an argument that without the rule the State could lose matching federal funds.

The courts have also reviewed the Board’s use of emergency rulemaking in

CBE. In

CBE, the appellate court found that the Board’s rules, adopted as emergency rules, were invalid

because there was no emergency. Specifically, in

CBE, the Board had adopted emergency rules

to implement the provisions of Section 39(h) of the Act (Ill. Rev. Stat. 1985 ch. 111 1/2 par.

1039(h)). Section 39(h) of the Act was enacted to prohibit the deposit of hazardous waste

streams in permitted hazardous waste landfills unless the waste generators and site owners and

operators obtain specific authorization from the Agency to do so. (Ill. Rev. Stat. 1985 ch. 111 1/2

par. 1039(h)),

CBE at 504 N.E.2d at 168. The Board argued that the amendments were

necessary to clarify Section 39(h) and reduce uncertainty in the industry. Further, the Board

argued that the rules would lessen the number of potential appeals. The court was unpersuaded

and found that none of these reasons constituted a threat to the public interest, safety, or welfare.

DISCUSSION

Before proceeding to a discussion on the merits of the motion, the Board will summarize

the emergency rulemakings undertaken by the Board in the last 11 years. Then the Board will

discuss the merits of the motion.

History of the Board’s Recent Use of Emergency Rulemaking

Before proceeding with a discussion of the merits of the proposed emergency rule, the

Board will review the recent history of emergency rulemaking before the Board. In the past

eleven years the Board has entertained emergency rule proposals only a handful of times. Twice

the Board adopted emergency rules to address waste left behind after the devastating flood of

1993.

See

Emergency Amendments to Landfill Rules for the On-Site Burial of Dead Animals in

Flood-Disaster Counties, R93-25 (Sept. 23, 1993) and Emergency Amendments to the Open-

Burning Rules, R93-15 (Aug. 20, 1993). The Board also adopted emergency livestock waste

management rules.

See

Emergency Rulemaking: Livestock Waste Regulations 35 Ill. Adm.

Code 505, R97-14 (Oct. 29, 1996 and Mar. 20, 1997). And the Board adopted two emergency

rules addressing air pollution in the Metro-East area.

See

Emergency Rule Amending 7.2 psi

Reid Vapor Pressure Requirement in the Metro-East Area, 35 Ill. Adm. Code 219.585(a), R95-10

(Feb. 23, 1995) and

Emergency Rule Amending the State II Gasoline Vapor Recovery Rule in

the Metro-East Area, 35 Ill. Adm. Code 219.586(d), R93-12 (May 20, 1993). The Board has

also declined to proceed with an emergency rule proposal.

See

Revisions of Treatability Testing

Exclusion Limits: Amendments to 35 Ill. Adm. Code 721.104(f)(3) through (f)(5), R94-18

(July 21, 1994).

With regards to the flood-related emergency rulemakings (R93-25 and R93-15), the

Board noted that the sheer volume of waste created by the flood and potential health hazards to

leaving the waste unmanaged resulted in a threat to the public interest safety and welfare.

See

,

R93-25, slip op at 5; R93-15. slip op at 5. In R93-15 and R95-10, the Board found a threat to

public interest because of the economic hardships that would be placed on businesses dispensing

and producing gasoline in the Metro East area.

See

R93-15, slip op at 8; R95-10, slip op at 5.

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7

The Board’s reasons for emergency rulemaking in R97-14 were to alleviate a potential threat to

public health and interest by adopting design standards for livestock management facilities at a

time when such facilities had begun to proliferate in the State.

See

R97-14, slip op at 6.

Discussion of the Amended Motion for Emergency Rulemaking

In analyzing any request for emergency rulemaking, the Board must determine first

whether an emergency within the meaning of the APA exists, and only second what the content

of the emergency rule should be. Here, the Board’s analysis begins and ends at the answer to the

first question, and the Board need not address the content of the proposed emergency rules.

The Board has rarely used emergency rulemaking in the last 11 years. In each instance

where the Board decided to proceed with the emergency rulemaking, a serious threat to the

public existed. In this proceeding, the Board is not persuaded that a situation exists which

“reasonably constitutes a threat to the public interest, safety, or welfare” (5 ILCS 100/5-45(a)

(2002)). In fact the Board finds that the situation created by the Board’s decision in

Illinois

Ayers and the resulting response of the Agency to that decision is completely analogous to the

facts of

CBE.

In

CBE, the legislature added Section 39(h) of the Act (415 ILCS 5/39(h) (2002)) in

1981, although the section did not become effective until January 1, 1987.

CBE, 504 N.E.2d at

168. On October 23, 1986, the Board adopted emergency rules.

Id

. at 169. The Board argued

several reasons for the emergency which justified rulemaking under Section 5.02 of the APA (5

ILCS 100/5-02 (2002)).

CBE, 504 N.E.2d at 169. First the Board argued that the emergency

rules clarified the generally worded provisions of Section 39(h) and the clarification would

reduce uncertainty in the regulated community.

Id

. The Board also argued that clarifying

Section 39(h) would reduce appeals to the Board and ease the transition period when final rules

are adopted.

Id

.

The court in

CBE was not persuaded. The court noted that emergency rulemaking is

justified “when there

exists

a situation which reasonably constitutes a

threat

to the public

interest, safety or welfare.”

CBE, 504 N.E.2d at 169. The court went on to state:

Stated differently, the need to adopt emergency rules in order to alleviate an

administrative need, which by itself, does not threaten the public interest, safety

or welfare, does not constitute an emergency. Notwithstanding that the reason

given by the Board to justify the invocation of emergency rulemaking would

indeed ease in the implementation of Section 39(h) no facts have been presented

to show that without the emergency rules the public would be confronted with a

threatening situation.

Id.

The court found that the Board had not established that ambiguity in Section 39(h) constituted a

threat to the public.

Id

. The court further found that the Board’s argument concerning the

limiting of appeals also did not establish a threat to the public safety or welfare.

Id

.

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8

In this instance, the threat to the public interest as argued by the Agency appears to be

two-fold. First, the Agency argues the Agency cannot guarantee consistency in decisions

without the emergency rule. Second, the Agency predicts the fund will be depleted at “an even

faster rate.” Am.Mot. at 2, 3. PIPE asserts that a threat to the public interest exists because of an

“administrative dilemma.” Am.Resp.1 at 4-5. Neither the Agency nor PIPE has supplied facts

that establish a situation exists which “reasonably constitutes a threat to the public interest,

safety, or welfare” (5 ILCS 100/5-45(a) (2002)). Prior to the Agency’s use of the rate sheet, the

Agency processed reimbursement and budget requests and the UST Fund survived.

See

,

e.g.

,

Platolene 500, Inc. v. IEPA, PCB 92-9 (May 7, 1992); Kathe’s Auto Service Center v. IEPA,

PCB 96-102 (Aug. 1, 1996);

Riverview F.S. v. IEPA, PCB 99-227 (May 3, 2001); Rantoul

Township High School Dist. No. 193 v. IEPA, PCB 03-42 (Apr. 17, 2003); and Riverview FS,

Inc. v. IEPA, PCB 97-226 (May 3, 2001). Thus, the concerns about consistency and slowing

depletion of the fund may be legitimate concerns, but do not constitute a

threat

to the public

interest, safety or welfare.

Furthermore, as the court found in

CBE, easing administration of the program while

proceeding with permanent rules also does not constitute an emergency. In this case, adopting

an emergency rule to assist the Agency in processing reimbursement and budget requests

while

the permanent rules are proceeding under the APA, does not amount to an emergency situation

within the meaning of the APA. Therefore, the Board finds that there is no situation exists which

“reasonably constitutes a threat to the public interest, safety, or welfare” (5 ILCS 100/5-45(a)

(2002)) and the motion and amended motion are denied.

Finally, as a practical matter, the Board observes that the participants desire for

administrative ease would likely not be guaranteed even if the Board were to grant the Agency’s

amended motion and today adopt the emergency rules proposed in the motion. The Board notes

that it has already held three days of hearing in this matter, on March 15, 2004 and May 25-26,

2004. The Board has not yet heard testimony from the public or affected participants on the

subject of the proposed rules. At the conclusion of the last hearing a new round of hearings was

scheduled for the week of June 21, 2004, with an additional day scheduled for July 6, 2004.

Under these circumstances, it is highly unlikely that the Board can propose a permanent rule for

first notice and complete permanent rulemaking in this consolidated docket within the 150-day

period in which any emergency rule adopted today would be in effect.

CONCLUSION

The Board has reviewed the APA and the recent history of emergency rulemaking before

the Board, including court decisions in

Senn Park and CBE. Based on the definition of

“emergency” in the APA, as well as the ruling in

Senn Park and CBE, the Board finds that the

Agency has not demonstrated that a situation exists which is a threat to the public interest, safety,

or welfare justifying an emergency rulemaking. Therefore, the Board denies the Agency’s

motion and amended motion for adoption of emergency rules in this proceeding. In so ruling,

the Board makes no comment on the merits of the content of the rules proposed in the Agency’s

amended motion.

Hearings in this docket will continue as scheduled beginning June 21, 2004.

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9

IT IS SO ORDERED.

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

adopted the above order on June 3, 2004, by a vote of 5-0.

Dorothy M. Gunn, Clerk

Illinois Pollution Control Board