RECEIVED
BEFORE THE POLLUTION CONTROL BOARD
CLERK’S OFFICE
OF THE STATE OF ILLINOIS
FREEDOM
OIL
COMPANY,
)
Petitioner,
V.
ILLINOIS ENVIRONMENTAL
PROTECTION AGENCY,
)
PCB No.
03-54
)
PCB No. 03-56
)
PCB No. 03-105
)
PCBNo.03-179
)
PCB No. 04-02
)
(LUST Fund/UST Appeal)
)
(Consolidated)
)
MAY 132005
STATE OF
ILUNOIS.
Pollution Control Board
Respondent.
)
Dorothy M. Gunn, Clerk
Illinois Pollution Control Board
James R. Thompson Center
100 West Randolph Street
Suite 11-500
Chicago, IL 60601
Carol Webb, Hearing Officer
Illinois Pollution Control Board
1021 North Grand Avenue, East
P.O .Box 19274
Springfield, IL 62794-9274
Diana M. Jagiella
Howard & Howard
One Technology Plaza
Suite 600
211 Fulton Street
Peoria, IL 6 1602-1350
PLEASE TAKE NOTICE that I have today filed with the office of the Clerk of the Pollution
Control Board a RESPONSE TO MOTION FOR SUMMARY JUDGMENT AND CROSS MOTION
FOR SUMMARY JUDGMENT, MOTION TO STRIKE, and MOTION FOR LEAVE TO FILE
iNSTANTER, copies ofwhich are herewith served upon you.
Respectfully submitted,
John ~k’Kim
Assistant Counsel
Special Assistant Attorney General
Division ofLegal Counsel
1021 North Grand Avenue, East
P.O. Box 19276
Springfield, Illinois 62794-9276
217/782-5544
217/782-9143 (TDD)
Dated: May 11, 2005
AGENCY,
NOTICE
ILLINOIS ENVIRONMENTAL
PROTECTION AGENCY,
PCB No.
03-54
)
PCB No. 03-56
)
PCB No. 03-105
)
PCBNo.03-179
)
PCB No. 04-OT
)
(LUST Fund!LJST Appeal)
)
(Consolidated)
)
FREEDOM OIL COMPANY,
RECEIVED
BEFORE THE POLLUTION CONTROL BOARD
CLERK’S OFFICE
OF THE STATE OF ILLINOIS
.
MAY 132005
)
STATEOFILLINOIS
Pollution Control Board
Petitioner,
V.
Respondent.
)
MOTION FOR LEAVE TO FILE INSTANTER
RESPONSE TO MOTION FOR SUMMARY JUDGMENT
AND MOTION TO
STRIKE
NOW COMES the Respondent, the Illinois Environmental Protection Agency (“Illinois
EPA~’),by one of its attorneys, John J. Kim, Assistant Counsel and Special Assistant Attorney
General, and, pursuant to 35 Ill. Adm. Code 101.500, hereby requests that the Illinois Pollution
Control Board (“Board”) grant the Illinois EPA leave to file instanter its Response to Motion for
Summary Judgment and Motion to Strike. In support ofthis motion, the Illinois EPA states as
follows:
On or about April 4, 2005, the Petitioner, Freedom Oil Company, filed its Motion for
Summary Judgment with the Board. However, the Illinois EPA received its copy ofthe motion
on March 31, 2005. Therefore, the Illinois EPA’s response was due on or before April 14,
2005.
On April 14, 2005, the Illinois EPA mailed a motion for extension of time to the Board and to
the Petitioner. The motion sought an extension oftime until April 19, 2005, by which to file the
response to the Petitioner’s motion.
On April 18, 2005, the Hearing Officer approved the Illinois EPA’s request for an
extension of time. Unfortunately, on April 19, 2005, the Illinois EPA’s computer network
r
1
experienced apparent hardware problems, and thus the ability to perform any word processing or
printing of documents was lost. This problem was reported to the Hearing Officer by the
undersigned counsel for the Illinois EPA.
On April 22, 2005, the Hearing Offiôer entered an order, noting the Illinois EPA’s
computer problems and directing the Illinois EPA to file a motion for leave to file instanter when
the response to the Petitioner’s motion for sununaryjudgment was filed. Since the time of the
entry of the Hearing Officer’s order to the present date, counsel for the Illinois EPA has
unfortunately not been able to complete the response to the Petitioner’s motion for summary
judgment and related motion to strike until now. While certainly regrettable and not at all
desired, this delay was the result of the undersigned counsel’s continued obligations to other
pending appeals as well as non-appeal matters.
This delay was not in any way due to any bad faith on the part ofthe Illinois EPA, and all
possible efforts will be made to prevent any further recurrence of this type of delay henceforth.
However, the Illinois EPA respectfully requests that the Board grant this motion so that both
parties will be heard and the Board can rule upon the, motions with a full understanding of the
facts and legal arguments.
WHEREFORE, for the reasons stated above, the Illinois EPA hereby respectfully
requests that the Board grant the Illinois EPA leave to file instanter its Response to the
Petitioner’s Motion for Summary Judgment and Motion to Strike.
2
Respectfully submitted,
ILLINOIS ENVIRONMENTAL PROTECTION AGENCY,
Assistant Counsel
Special Assistant Attorney General
Division ofLegal Counsel
1021 North Grand Avenue East
P.O.Box 19276
Springfield, Illinois 62794-9276
217/782-5544
217/782-9143 (TDD)
Dated: May 11, 2005
This filing submitted on recycled paper.
3
BEFORE THE POLLUTION CONTROL BOARD
CLERK’S OFFICE
OF THE STATE OF ILLINOIS
MAY 132005
FREEDOM OIL COMPANY,
)
•PCB No 03-54
STATE OF ILLINOIS
/
.
Pollution Control Board
Petitioner,
)
PCB No.
03-56
)
PCB No. 03-105
v.
)
PCB No. 03-179
)
PCB No. 04-02
-
ILLiNOIS ENVIRONMENTAL
)
(LUST FundIIJST Appeal)
PROTECTION AGENCY,
)
(Consolidated)
)
Respondent.
)
MOTION TO
STRIKE
PORTIONS OF TilE
PETITIONER’S MOTION FOR SUMMARY JUDGMENT
NOW COMES the Respondent, the Illinois Environmental Protection Agency (“Illinois
EPA”), by one of its attorneys, John J. Kim, Assistant Counsel and Special Assistant Attorney
General, and, pursuant to 35 Ill. Adm. Code 101.500 and 101.502, hereby requests that the
assigned Hearing Officer or the Illinois Pollution Control Board (“Board”) strike portions of the
Petitioner’s motion for summary judgment. In support ofthis motion, the Illinois EPA states as
follows:
The Petitioner MakesReference To Information Outside Of The Administrative Record
The Petitioner, Freedom Oil Company, filed a motion for summary judgment (“motion”)
on or about April 4, 2005. Included in the motion are a number ofreferences to documents and
content contained within exhibits to the motion. Specifically, the motion refers to two affidavits,
and representations therein, as found in Exhibit 17.
However, the representations ofthe affiants, Michael J. Hoffman and Richard Pletz, were
made on March 30, 2005. Exhibit 17, pp. 1089, 1091. These representations clearly post-date
all ofthe final decisions currently under appeal, therefore reference to the information within that
exhibit is not appropriate. The Board’s review ofpermit appeals, including appeals ofdecisions
1
related to the Leaking Underground Storage Tank Program, is generally limited to information
before the Illinois EPA during the Illinois EPA’s statutory review period, and is not based on
information developed by the permit applicant or the Agency after the Agency’s decision. Alton
Packaging Corp. v. Pollution Control Board, 162 Ill. App. 3d 731, 738, 516 N.E.2d 275, 280
(5th
Dist. 1987); Saline County Landfill, Inc. v. Illinois EPA, PCB 02-108 (May 16, 2002).
Pursuant to well-established Board precedent, the Board should consider any of the
information contained within Exhibit 17, and the Petitioner’s motion should be stricken
accordingly.
WHEREFORE, for the reasons stated above, the Illinois EPA hereby respectfully
requests that the Board strike Exhibit 17 in the Petitioner’s motion, and further strike any and all
references to that Exhibit the information therein as such references may exist within the
Petitioner’s motion.
Respectfully submitted,
ILLINOIS ENVIRONMENTAL PROTECTION AGENCY,
Assistant Counsel
Special Assistant Attorney General
•Division ofLegal Counsel
1021 North Grand Avenue, East
P.O. Box 19276
Springfield, Illinois 62794-9276
•
217/782-5544
217/782-9143 (TDD)
Dated: May 11, 2005
,
This filing submitted on recycled paper.
2
BEFORE THE POLLUTION CONTROL BOARD
RECEIVEDCLERK’S
OFFICE
OF THE STATE OF ILLINOIS
MAY 13 2005
FREEDOM OIL COMPANY,
)
STATE OF ILLtNOIS
)
PCB No. 03-54
Pollution
Control Board
Petitioner,
)
•
PCB No. 03-56
)
PCB No. 03-105
v.
)
PCB No. 03-179
)
PCB No. 04-02
-
ILLINOIS ENVIRONMENTAL
)
(LUST FundIUST Appeal)
PROTECTION AGENCY,
)
(Consolidated)
)
Respondent.
)
RESPONSE TO MOTION FOR SUMMARY JUDGMENT
AND CROSS MOTION FOR SUMMARY JUDGMENT
NOW COMES the Respondent, the Illinois Environmental Protection Agency (“Illinois
EPA”), by one of its attorneys, John J. Kim, Assistant Counsel and Special Assistant Attorney
General, and, pursuant to the Illinois Pollution Control Board (“Board”) Rules at 35 Ill. Adm. Code
101.500, hereby responds to the Motion forSummary Judgment (“motion forsummaryjudgment” or
“motion”) filed by the Petitioner, Freedom Oil Company (“Freedom Oil”) and also moves for,
summary judgment in favor ofthe Illinois EPA. The Illinois EPA requests that the Board enter an
order denying the Petitioner’s motion in its entirety and issue an order granting the Illinois EPA’s
cross motion.
I. NOT
ALL
ISSUES RAISED IN THE APPEALS
ARE ADDRESSED IN PETITIONER’S MOTION
Previously, in late January 2003, the Hearing Officer assigned to the above-referenced
appeals consolidated the appeals for purposes ofdocketing convenience. Of the five appeals that
have been consolidated, three appeals involve final reimbursement decisions (PCB 03-105, 03-179,’
04-02) and two appeals concern technical final decisions (PCB-03-54,
03-56).
The motion filed by
1
the Petitioner addresses only the issues raised in the three reimbursementdecisions, and therefore it
must be assumed that, at least for now, the Petitioner is not choosing to present a motion for
summaryjudgment as to PCB 03-54 and 03-56. Accordingly, fornow, the Illinois EPA will also set
those matters aside and instead shall focus on the three reimbursement final decisions.
II. COMMON
ISSUE ON
APPEAL
In its motion, the Petitioner states that the issue before the Board is a simple one.
Specifically, can the, Illinois EPA direct or compel, by court order, corrective action with regard to
releases from tanks eligible for reimbursement from the Underground Storage Tank Fund (“UST
Fund”), and then deny such reimbursement because ineligible tanks are discovered during the
implementation ofthe corrective action. Simply put, the Illinois EPA can clearly take the action
describedby the Petitioner.
The Petitioner’s issue is really a two-part question. First, can the Illinois EPA direct or
compel, by~court order, corrective action with regard to releases from tanks (either eligible or
ineligible for reimbursement from the UST Fund)? The answer is yes, as provided for in several
different provisions ofthe Illinois Environmental Protection Act (“Act”) (415 ILCS 5/1, et
However, it should be noted that, as was done in this case, it is not the Illinois EPA but rather an
action brought in the name of the People of the State ofIllinois that compels a defendant to take
corrective action if warranted. The Illinois EPA can request that the Illinois Attorney General’s
Office initiate such an action (subjectto certain procedural requirements having been met), but it is
formally the State ofIllinois, and not a particular agencythereof, that acts as the plaintiffin an action
‘The Petitioner’s motion includes copies ofthe complaints and orders related to the corrective action in this
particular situation. There are other general provisions in the Act, including prohibitory water pollution and
land pollution sections, that are applicable depending on the specific facts related to a release.
•2
seeking to compel the performance ofcorrective action. Though this clarification is a fairlyobvious
one, it needs to be stated given that there seems to be a thematic implication in the Petitioner’s
motion that the Illinois EPA itselfhas acted in either an inappropriate orinconsistent manner. Such
is not the case, and the Illinois EPA’s role needs to be defined and understood.
The second part ofthe issue identifiedby the Petitioner is whetherthe Illinois EPA-candeny
reimbursement of costs paid from the UST Fund on the basis that ineligible tanks are discovered
during remediation ofa site in which at leastone eligible UST hasexperienced a release. Again, the
answer is clearly yes, as provided forin Section
57.8(m)
of the Act (415 ILCS
5/57.8(m)).
So the answerto the questionposed by the Petitioner must be answered affirmatively, which
is consistent with the sequence of events here. The Petitioner attempts to tie the performance of
ordered corrective action with the possibility of resulting costs being reimbursed in full from the
UST Fund. Thereis no such condition in the Act, and the court here recognized no suchconnection,
in terms ofa party not being requiredto perform corrective action if contamination is found at a site
that includes tanks that are ineligible for reimbursement.
The true issue here is whether the Illinois EPA properly apportioned costs submitted for
reimbursement by the Petitioner, given that therewere indisputably ineligible tanks at the site and the
Petitioner failed to properlyjustif~’all costs attributable to eachUST at the site. The Petitioner states
that the Illinois EPA imposed the apportionment despite an absence ofevidence demonstrating the
ineligible tanks created any conditions requiring remediation.
That statement twists the
interpretation ofSection
57.8(m),
since it is the owner/operator that is required to justify that costs
are attributable to each UST at the site. Put anotherway, Freedom Oil failed to demonstrate that the
costs that were the subject ofthe reimbursement requests in the three consolidated appealswere all
3
attributable only to eligible, and not in any wayto any ofthe ineligible, tanks at the site. Given that
failure, Freedom Oil did not satisfy its obligation pursuant to Section 57.8(m) ofthe Act, and the
action taken by the Illinois EPA in response was correct.
III.
STANDARD
FOR
ISSUANCE
OF SUMMARY JUDGMENT
A motion for summary judgment should be granted where the pleadings, depositions,
admissions on file, and affidavits disclose no genuine issue as to any material fact and the moving
party is entitled to judgment as a matter oflaw. Dowd & Dowd, Ltd. v. Gleason, 181 Ill.2d 460,483,
693 N.E.2d 358, 370 (1998); Ozinga Transportation Services v. Illinois Environmental Protection
Agency, PCB 00-188 (December 20, 2001), p. 2.
In the present situation, the relevant facts are applicable to each ofthe three consolidated
reimbursement appeals, with one caveat. From the time ofthe initial reporting ofa release at the
Freedom Oil site, to the date ofthe final decision under appeal, there were new facts that came to
light and also there were a sequence ofdifferent eligibility and deductibility decisions issued by the
Office ofthe State Fire Marshal (“OSFM”).
In order forthe Board to grant summary judgment in favor ofeither party in this action, it
must first decide that there are no material facts at issue. The parties generally agree upon the facts
here, but the conclusions to be drawn from those facts are not agreed upon, asthe parties have polar-
opposite positions on the fundamental question ofwhether the Petitioner has satisfied its burden to
demonstrate that all costs are attributable to each UST at the site. Freedom Oil believes it has met
that burden such that apportionment is not appropriate, while the Illinois EPA argues no suchburden
hasbeen met. Ifthe Board determines this situation is tantamount to a material issue offact, then the
Board should deny Freedom Oil’s motion for summaryjudgment. Ifthe Board instead determines
4
that the parties do agree on the basic facts, and that the legal interpretation to be drawn therefrom is
the basis for the dispute, then the Board should grant summary judgment in favor ofthe Illinois
EPA.2
IV. ARGUMENT
Freedom Oil has presented three arguments in support of its claim that it should not be
subjected to the apportionment provisions of Section 57.8(m) of the Act and corresponding
regulation Section 732.608
(35
Ill. Adm. Code 732.608).
First, the Petitioner argues that OSFM’s field observations, and requirement that the
petitionerreport suspected releases, are not determinative ofwhether correctiveaction was required,
since the field observations and analytical results from the site show no basis for such order.
Petitioner’s motion, p.
15.
Second, the Petitioner argues that the Illinois EPA has taken different positions in circuit
court and in its final decisions now under appeal. Petitioner’s motion, pp.
‘15-16.
Finally, the Petitioner argues that the field conditions and analytical evidence confirm thatthe
eligible tanks, not the ineligible tanks were the source ofthe contamination at the site. Petitioner’s
motion, p. 16.
As the Illinois EPA will counter, each ofthose arguments fails and instead a conclusion in
favor ofthe Illinois EPA should be reached.
2
Although the Board could reach the conclusion that a hearing is needed based upon a finding that factual
issues remain, the Illinois EPA will henceforth argue that summary judgment is appropriate and should be
•
granted in favor ofthe Illinois EPA.
5
A. OSFM’s Actions Were Correct
-
The involvement ofOSFM (both from field inspections and in issuance of final eligibility
and deductible decisions) in this situation was correct in all aspects, but does not reflect any reason
why the Illinois EPA’s decisions under appeal were in error.
InMarch 1993, a 1,000 gallon underground storage tank (“UST”) was removed AR I, p. 29.~
As the Petitioner noted, the release and removal activities associated with that tank (Tank #5) was
resolved and the incident numberassociated with the release was closed. Petitioner’s motion, p. 4.
In September and October of1996, the UST system at the site was undergoing environmental
upgrade under the supervision ofa representative ofthe OSFM. AR I, p. 29. Later, in April of2002,
a release was reported (Incident #2002-0433) based upon a presence ofodors in an adjoining high
school. AR I, p. 76. Severalmonths later, in August of2002, anothersuspected release was reported
(Incident #2002-1122) based upon further odors detected near the site. Petitioner’s motion, Exhibit
4, p. 57. As the Petitioner itself noted, the role of OSFM in removal oversight is not to determine
whether corrective action (orwhat type ofcorrective action) is neededbased upon site conditions at
the time of tank removal. Rather, the role of the on-site inspector/representative of OSFM is to
determine whether conditions (either the site conditions or the tank/system conditions) indicate the
possibility ofa release from the subject UST(s). Ifthere is reason to believe a suspected release has
occurred, the inspector/representative will direct the owner/operator of the UST to report the
suspected release to IEMA.
~The administrative records in these appeals were unfortunately filed following the filing ofthe Petitioner’s
motion. Henceforth, reference to the records will be made as follows. For the administrative record for PCB
03-54and 03-56, reference will be to “ART, p._.” The record for PCB 03-105 will be referredto as “ARII,
p.
,“
the recordforPCB 03-179 will be “ARIII, p.
,“
and the record for PCB 04-02 will be “ARTV, p.
6
Thus, the OSFM inspectors in this situation performed theirroles exactly as-required.
-
They
witnessed all requisite on-site removal activities, and properly instructed the owner/operator ofthe
USTs to report the suspected releases to IEMA. What was more telling, though, were the actions of
the Petitioner in filing applications for eligibility/deductible determinations from OSFM.
On July 11, 2002, OSFM received an Eligibility and Deductibility Application (“EDA” or
“application”) from Freedom Oil. In the July 2002 EDA, Freedom Oil represented that there were
six tanks at the site, four of which had had a release. Freedom Oil also stated that the Incident
numberfor which reimbursementwould be sought was #2002-0433. AR II,pp. 8-9. Ofthe six tanks
at the site, Freedom Oil presented the following information to OSFM:
AR H, p. 11. Therefore, Freedom Oil informed OSFM that there were at one time six tanks at the
site, one ofwhich (Tank
#5)
having been previously removed. Freedom Oil also stated that all the
tanks but Tanks #1 and 6 had experienced a release.
,
Based on this information, OSFM issued a determination on August 1, 2002, which found
that Tanks #2,3 and 4 were eligible for reimbursementfrom the UST Fund, and that Tanks #1,5 and
6 were listed for the site but not found eligible at that time. AR II, pp.
5-6.
This decision from
7
OSFM was the first of several to be issued for the site, each based upon additional or new
information received from Freedom Oil.
-~
Later in August 2002, another sus~ectedrelease was discovered at the FreedomOil site, and a
second report was made to IBMA, with a second incident number (#2002-1.122) being assigned to
the site. This release was the subject ofat least one court hearing in Edgar County Circuit Court, a
transcript of which is found in Exhibit 9 of the Petitioner’s motion. As a result of the legal
proceedings, at least two different injunction orders were issued by the court, one on August 15,
2002 (AR I, pp. 198-203), and one on August 23, 2002 (Petitioner’s motion, Exhibit 11, pp. 579-
584).~Based upon the arguments ofthe partiesand the court’s consideration ofthe facts presented,
the relief found in the orders was carried out.
In late October 2002, Freedom Oil submitted another EDA to OSFM. AR II, pp. 18-21. In
that EDA, Freedom Oil then represented that there were 11 tanks at the site, nine of which had
experienced a release. AR II,pp. 19, 21. As noted by the Petitioner in its motion, none ofthe parties
were aware ofthe additional tanks (#7 through #11) until the remediation initiated following the
issuance of the court’s orders. The information in the October 2002 EDA was the same as the
information in the table above, with some exceptions. Tanks #1 through #4 were now listed asbeing
taken out ofservice on September
5,
2002, with removal dates of September 6, 2002. Also, Tanks
#7 through #11 were now listed as being associated with the site, with the installation and taken-out-
of-service dates being pre-1974, and removal dates ofOctober 3, 2002 (with the exception of#l 1,
4 There are certain documents contained within the Petitioner’s motion’s exhibits which are not foundin the
administrative records filed by the Illinois EPA. This omission is due to the fact that the records contain the’
documents relied upon by the Illinois EPA staffin issuing the final decisions under appeal, and those omitted
documents were not included in the list ofdocumentsreliefupon. However, to the extent that such documents
did pre-date the final decisions under appeal, and in this instance reflected the participation of the State of
8
which was removed on October 8, 2002). Also, Tanks #7 through #11 were all reported as having
hadarelease. ARII,p.21.
The Illinois EPA’s final decision dated December 18, 2002, was issued in accordancewith
the information available at that time. AR H, pp. 1-4. See, Attachment i.5 After the Illinois EPA’s
December 2002 final decisionwas issued, OSFM issued another final decisionregarding eligibility
and deductible. On February 26, 2003, OSFM issued a decision that determined Tanks #1, 2, 3, 4,
and 6 were eligible for.reimbursement from the UST Fund. The decision also noted that Tanks #5,7,
8, 9, 10 and 11 were listed for the site, though they were not found to be eligible. AR ifi, pp. 35-36.
Inreliance onthe informationfound within the February 2003 OSFM final decision, the Illinois EPA
issued another final reimbursement decision on March 19, 2003. AR ifi, pp. 1-5; Attachment 1.
Finally, on March 25, 2003, OSFM issued anotherrevisedeligibility and deductible decision
for the Freedom Oil site. That decision was essentially the same in content as the February 2003
decision, other than noting that Tank #11 contained heating oil instead ofused oil. On May 28,
2003, the Illinois EPA issued the last reimbursement decision under appeal, again relying on the
most recently-issued OSFM decision. AR IV, pp. 1-5; Attachment 1.
-
In each instance, OSFM has acted in accordance with its statutory mandate, issuing final
decisions regardingeligibility and deductibles based on the applications submitted .to it. The on-site
inspector from OSFM properly noted that there were conditions regarding the ineligible tanks such
that a suspected release should be reported. The related information contained in the EDAs
submitted to OSFM by Freedom Oil must be taken as true, as the information was certified as such
Illinois in enforcementproceedings regardingthe FreedomOil site, reference to such documents is appropriate.
5Attached to this pleading is Attachment 1, which summarizes the information relied upon (including admitted
errors in calculation) by the Illinois EPA in each of the reimbursement decisions under appeal.
9
by Freedom Oil (or a designated agent thereof). AR H, p. 10; AR H, p. 20. Therefore, as was
certified by Freedom Oil, Tanks #7 through #11 did experience releases.
-~
B. Judicial Estoppel Is
Not Appropriate
In its motion, the Petitioner also argued that the State represented in circuit court that
corrective action was needed due to discharges from eligible tanks at the Freedom Oil site, and thus
the State is now judicially estopped from taking a different position in this forum. To support this
claim, the Petitioner has cited to portions oftranscripts from hearings held on August 15, 2002, and
August 23, 2002. Petitioner’s motion, pp. 8-10.
However, as even the Petitioner acknowledges, neither the State (including representatives of
the Illinois EPA and OSFM) nor Freedom Oil was aware ofthe existence ofthe ineligible tanks until
September 2002 when the excavation at the site revealed theirpresence. Petitioner’s motion, p. 17;
Petitioner’s motion, Exhibit
5,
p. 456 (“The five ineligible or unregulated tanks (tanks 7-11) were
discovered on October 2, 2002
* *
With that understanding of the time line (i.e., August 2002: statements made in court;
October 2002: ineligible tanks first discovered), the Petitioner’s argument in support ofjudicial
estoppel must fail for one—if not all—ofthe following reasons.
First, and foremost, no party, including the State, was aware ofany ineligible tanks at the site
at the time ofthe statements cited to in circuit court. Those ineligible tanks were only discovered
after the issuance of the resulting orders from the court. The Petitioner’s argument, if taken as
correct, would mean that a party would not be ableto conform arguments with the discovery ofnew
facts. It would be extremelyprejudicial to hold any party to aposition based on facts that all parties
later agree do not accurately reflect conditions at a site. In short, the Petitioner cannot show that the
10
State has made inconsistent statements, since the facts upon which any such statements would be
based were different from August 2002 (when statements were made in court) to December 2002
(whenthe first ofthe reimbursement decisions was issued). The contravening discovery in October
2002 ofthe ineligible tanks more thanjustifies the Illinois EPA acting on the most recent set offacts.
Further, it is likely there is no real inconsistency (of the kind referred to in the elements of
judicial estoppel) in this situation. Courts have determinedthat representations on matters ofopinion
are insufficient to support the invocation ofthe doctrine ofjudicial estoppel. Ceres Terminals, Inc.
v. Chicago City Bank & Trust Co., 259 Ill. App. 3d 836, 851, 635 N.E.2d 485, 496 (1st Dist. 1994).
When the representative of the State made statements in court in August 2002, it was an opinion
based upon the facts asthen known. When the Illinois EPA issued final reimbursement decisions in
December 2002, February 2003 and May2003, theywere opinions based on the facts as then known.
The change in opinions, if any, is due to the change in facts.
Also, to prevail in a claim ofjudicial estoppel, the estopped party must have asserted
inconsistent positions in separate proceedings in order to receive favorable judgments in each
proceeding. Ceres Terminals, 259111. App. 3d at 850, 635 N.E.2d at 494. Here, while the statements
made by the State in August 2002 were clearly made in circuit court proceedings, the decisions
issued by the Illinois EPA in December 2002, March 2003 and May2003 were final administrative
decisions. The decisions were not offered by the Illinois EPA in any court or administrative
proceeding in order to obtain a favorable ruling, but ratherreflected the Illinois EPA’s determination
based upon information and claims submitted. For there to be some attempt by the Illinois EPA to
obtain a favorable ruling, the Petitioner would have to show that the Illinois EPA somehowbenefited
from the decisions under appeal. However, such is not the case, as the deduction ofcosts by the
11
Illinois EPA pursuant to apportionment does not in turn allow the Illinois EPA any access to that
money. There is no favor to be gained on the part ofthe Illinois EPA through thQ final decisions
here.
While the Illinois EPA is obviously defending the correctness of its decisions before the
Board, the argumentshere are not madeto further any benefit that would otherwise fall to the Illinois
EPA, but rather are in defense offinal decisions that conceivably maynot have-ever beenthe’subject
of any judicial or quasi-judicial review. To argue that the position taken by the State in seeking
injunctive relief equatesto a final decision issued in responseto a claim forreimbursement from the
UST Fund is a classic “apples and oranges” comparison.
-
For these reasons, the Petitioner has failed to demonstrate that the doctrine of judicial
estoppel is appropriate in this setting. Even if the argument is made that the doctrine could be
considered, the Petitioner has failed to prove all the necessary elements to warrant the imposition of
judicial estoppel.
C. The Petitioner Has
Not Shown Field Conditions And Analytical Results
Prove The Eligible Tanks The Sole Source
Of Contamination
The last argument proffered by the Petitioner is that the field conditions and analytical results
from the site demonstrate that only the eligible tanks were the source ofcontamination, anidtherefore
the costs associated with corrective action should be consideredwithout any regard to the ineligible
tanks.
As the parties agree, the standard for application of apportionment of costs is found in
Section 57.8(m) ofthe Act:
12
The Agency may apportion payment of costs for plans submitted under Section
-
57.7(c)4)(E)(iii) if:
(1)
The owner or operator was deemed eligible to access the Fund for
payment of corrective action costs for some, but not all, of the
underground storage tanks-at the site; and
•
(2)
the owner or operator failed to justify all costs attributable to each
underground storage tank at the site.
To apportion costs as was done in the final decisions under appeal, the two requirements of
Section 57.8(m) must be in place. Here, the parties agree that Freedom Oil received final decisions
from OSFM that determined Freedom Oil was eligible to seek reimbursement for some, but not alL,
ofthe underground storage tanks at the site. Thus, the first requirement has been met.
Freedom Oil is arguing that the Illinois EPA cannot apportionment costs because Freedom
Oil hasnot failed to justify all costs attributable to eachunderground-storage:tankatTthe -site.. On this
point the parties differ.
The Petitioner argues that work related to the costs in Reimbursement Application 16 was
clearly related to the shear valve release from Pump No. 1. Further, the Petitioner argues that the
work done in connection-with ReimbursementApplications 2 and 3 was caused by tank linerfailure.
Petitioner’s motion, p. 16. The Petitioner goes on to contendthat Illinois EPA has submitted no
evidence ofany condition created by the ineligible tanks-that-required-remediation’under Illinois law.
Petitioner’s motion, p. 17.
The Petitioner claims that analytical results from sampling in connection with the 1993 and
1996 release, along with sampling from 2002, demonstrate that the ineligible tanks did not give rise
~
Application 1 was the claim forreimbursement that led to the December 2002 final decision,
while Reimbursement Applications 2 and 3 resulted in issuance ofthe February 2003 and May2003 final
decisions, respectively.
13
to any remediation obligation or create conditions needing corrective action. The Petitioner then
provides examples ofthe sampling results taken from those time periods as proofofits arguments.
Petitioner’s motion,, pp. ~1.7-22.
These arguments and offers ofinformation notwithstanding, thePetitioner’scontentions are
without merit. It is the owner or operator of the UST, not the Iliinois EPA, that carries the
responsibility ofjustifying all costs attributable to each UST at the site. The Illinois EPA is not
required to prove the negative, i.e., that there is information that demonstrates ineligible tanks were
contributory to contamination at the site. Even if the Illinois EPA were required to offer some
information to that end, the analytical results and site conditions would demonstrate the clear
likelihood that the ineligible tanks were responsible for at leastpart ofthe contamination at the site.
1. Freedom Oil’s consultant admitted it
did not verify whether
the ineligible tanks were contributing to the site condition
In a letter dated January 8, 2003, Michael Hoffhian, P.E., of MACTEC Engineering and
Consulting, Inc. (“MACTEC”), on behalfofFreedom Oil, responded to the Illinois EPA’s December
2002 final decision.
-
AR III, pp. 463-473. In the letter, sent to Michael Heaton ofthe Illinois EPA,
Mr. Hoffhian stated in part:
“Since this emergency response action was under the direction of the IEPA
Emergency Response Unit with a deadline mandated by the injunction obtained by
the state, Freedom was not afforded the opportunity to stop work to collect and
analyze soil samples to verify the orphan tanks were not contributing to the site
condition.” AR ifi, p. 466.
Mr. Hoffman both before and after making that statement argued that other information
available could be shown to demonstrate that the ineligible-tank-swerenot a contributing factor, and
those arguments will be addressed. However, the statement cited above clearly shows MACTEC’s
14
admission that it did not take any samples that would verify whether or not the ineligible tanks
contributed to the site conditions.7 Regardless ofthe factthat Freedom Oil was under a court order
to perform the remediation in question, Mr. Hoffman’s statement makes clear that no soil samples
were ,takento verify whether the ineligible tanks were responsible in any way forthe contamination
at the site. This lack ofpre-excavation sampling shows that Freedom Oil did not justify all costs
attributable to eachUST at the site.
2. The analytical and sampling results cited by Freedom Oil do not
rule out the possibility ofthe ineligible tanks contributing to the contamination
Despite the fact that Freedom Oil’s consultant conceded it did not take any samples that
would demonstrate the ineligible tanks were not contributor~imnature,Freedom Oil still argues that
it other information proves the ineligible tanks could not have caused any portion of the release
contamination at the site. In its motion, the Petitioner cites to several different sets ofsampling data
as proofthat the ineligible tanks were not a cause ofany contamination.
Before reviewing eachofthose sets, the Illinois EPA directsthe Board’s attention to a report
submitted by Harding ESE, Inc. (“Harding”) (the predecessor to MACTEC) on behalfofFreedom
Oil to the Illinois EPA, datedMay 22, 2002. AR I,pp. 73-163. Inthat report, Harding states that the
groundwater flow direction at the Freedom Oil site was determinedby aprevious consultant, PSI, in
1996 to be to the southwest. Further investigations by Harding confirmed a westerly flow direction.
7Throughout the Petitioner’s motion, there are repeatedprotestations regardingthe mannerin which the court-
ordered remediation was obtained, as well as the scope ofthe remediation. These comments have no relevance
ormerit in this appeal, however, as the Board is not in the position to second-guess injunctive orders issued by
a circuit court. The Petitioner’s complaints regarding the circuit court action could have seen dealt with in a
different forum, and the Board should not allow the Petitioner to cloud the issues here by attempting to
introduce such complaints into these appeals. While the Petitioner may have objections asto the scope ofthe
work that was performed, it was undisputably done following the entry ofordersby the court. The discovery,
following issuance ofthose orders, ofthe ineligible tanks is something that cannot be ignored or discounted
15
AR I, pp. 80, -93. With this statementregarding groundwater flow in mind, the sampling sets cited to
by the Petitioner should be reviewed.
The first sampling cited to by the Petitioner was taken by PSI as reported in a Preliminary
Contamination Assessment (“PCA”)dated January 16, 1997. Petitioner’s motion, p. 18; Petitioner’s
motion, Exhibit 3, pp.391-419 (or20-47, depending on’which page numbers are used). In the PCA,
PSI stated that four soil samples were taken from Borings B-l, B-2, B-3 and B-4. Petitioner’s
motion, Exhibit 3, p. 401. PSI also stated that the four soil borings were converted to four
groundwater monitoring wells, MW-i through MW-4, presumably consistent with the boring
numbers. Petitioner’s motion, Exhibit 3, p. 398. In a figure that accompanied the PCA, PSI showed
the locations ofthe four soil borings/monitoring wells, though not to scale. Petitioner’s motion,
Exhibit 3, p. 408.
The Petitioner cites PSI’s conclusion that the results from Borings 1 and 2 may not be as
extensive asthose near borings 3 and 4. Petitioner’s motion, p. 18. Boring 1 is locatedto the north
ofthe site, and Boring 2 is in the southeast corner ofthe site. The Petitioner then cites to the data
from Borings 3 and 4, which showed much more significant levels ofcontamination. Petitioner’s
motion, p. 19. Borings 3 and 4 were located somewhere on the south edge of the site, possibly
bordering the centerline ofthe site (again, the figure provided by PSI is not to scale). Petitioner’s
motion, Exhibit 3, p. 408. A more recent figure preparedby Harding shows the locations ofthe four
borings/monitoring wells utilized by PSI, along with showing the location of the UST Bed that
contained Tanks #1 through #5. ART, p. 176. The UST Field referred to by PSI is the same as the
UST Bed referred to by Harding. These figures should also be compared to a soil excavation map
simplybecause Freedom Oil disagreed with having to perform the remediation in the first place.
16
prepared by Harding that also shows the location ofthe pre-74 USTs, orthe ineligible tanks at issue
here. AR HI, p. 473.
Takinginto account the locations ofthe borings/wells usedby PSI, and the groundwater flow
directions (southwesterly orwesterly) reported byHarding, it is anticipated that PSI’s Borings 1 and
2 would not yield datashowing significant contamination, as those borings were to the north and east
ofTanks #1 through #4 (the UST Field/Bed), #5 (shown in the “Excavation Former UST Location”
in PSI’s map (AR I, p. 43)), and the ineligible tanks (the pre-74 USTs shown in the Harding map
(AR ifi, p. 473)). Put another way, Boring 1 is north of the UST field/Bed and pre-74 tanks, and
Boring 2 is to the east ofthe UST Field/Bed and to the southeast ofthe pre-74 USTs. Given that the
groundwater flow is to the west or southwest, neither Boring 1 or 2 should show any significant
contamination.
Looking to PSI’s Borings 3 and 4, the higher levels of contamination that were shown are
expected, given the proximity ofthose borings to the UST Field/Bed. So, the PSI results cited tO by
the Petitioner are consistent with the site conditions and all UST locations, including the ineligible
tanks.
-
-
-
-
The next set ofsampling information referenced by the Petitioner is taken-from M-ACTEC’s
2002 sampling. The Petitioner notes in its motion that the analytical results of the samples taken
closest to the ineligible tanks did not identify contamination caused by the tanks requiring
remediation. The Petitioner then cites to results for: RW-l, B-02-1, MW-02-4, MP-02-3, B-02-6,
B-02-7, B-02-2, B-02-3, B-02-4, B-02-5, MW-i, MW-02-3 and MW-02-4. Petitioner’s motion, pp.
20-21. Looking to the Harding soil excavation map which shows the location of each of those
sampling points shows that each and every one ofthose points is located to the north ofthe Pre-74
17
USTs (ineligible tanks). AR ifi, p. 473. Again, given the groundwater flow being to the west or
southwest, there would be no reason to believe that any contamination resulting from releases fiom
the ineligible tanks would influence the sample results cited in the Petitioner’s motion, since eachof
those sampleswere taken in a direction opposite to the groundwater flow. Therefore, thereis no way
the Petitioner can claim that the results cited in its motion in any way support a claim that it has
justified the costs associated with each UST at the site.
Furthermore, the Petitioner’s reliance on
~m
readings is also without substance. The
Petitioner argues that the readings taken around the ineligible tanks in October 2002 indicate low
readings showing no releases requiring remediation. Petitioner’s motion, p. 22. But again, looking
to the locations cited to by the Petitioner, only one
~m
reading is in the approximate area ofany of
the Pre-74 (ineligible) tanks. Petitioner’s motion, Exhibit 16, p. 1087. Just one reading is far too
scant to draw any substantive conclusions as are being made by the Petitioner.
Also, the Petitioner argues that samples taken during removal and excavation in October
2002 confirm an absence of contamination. Petitioner’s motion, p. 22. But, as Freedom Oil’s
consultant acknowledged, there were no samples taken prior to excavation to test whether the
ineligible tanks were contributingto the contamination. AR ffi, p. 466. The samples that were taken
were bottom and sidewall samples taken after excavation was completed. AR ifi, p. 466. A
comparisonofthe dates ofineligible tank removal (October 3 and 8,2002)versus the sampling dates
(October 3, 7 and 9,2002) confirmthat no pre-excavation samples were taken. AR ifi, pp. 471-472;
ARffl,p. 485.
Therefore, none of the sampling data presented by the Petitioner demonstrates. that the
ineligible tanks were not contributory to the contamination-at the site, and there is no showing ofany
18
kind by the Petitioner that it justified the costs attributable to each UST at the site prior to the
issuance ofany ofthe reimbursement decisions under appeal.
-~
V. CONCLUSION
-
Section 57.8(m) ofthe Act clearlyplaces the burden upon the owner oroperator to justify the
costs attributable to each UST at a site to avoid the possible imposition ofapportionmentofcosts. In
this situation, Freedom Oil did not provide the Illinois EPA with any information as ofthe time of
issuance of its reimbursement final decisions that could allow Freedom Oil to escape an
apportionment ofits costs. Ifanything, there is a dearth ofsampling information that would allow
Freedom Oil to make any kind of claim to justify the costs at the site on an UST-by-UST basis.
Given that there were ineligible tanks at the site, and that Freedom Oil failed to justify the costs as
otherwise requiredby statute, the Illinois EPA’s imposition ofan apportionment ofcosts was correct.
The Illinois EPA therefore respectfully requests that the Board affirm its decisions as to
apportionment ofcosts.8
--
ILLINOIS ENVIRONMENTAL PROTECTION AGENCY,
Assistant Counsel
Special Assistant Attorney General
Division ofLegal Counsel
-
-
1021 North Grand Avenue, East
P.O. Box 19276
Springfield, Illinois 62794-9276
217/782-5544
217/782-9143 (TDD)
Dated: May 11,2005
•
8
The other miscellaneous costs included in the reimbursement final decisions are contested from a factual
standpoint, and therefore are not suitable for resolution via a motion for summary judgment.
19
Attachment
1
D:
Diesel
E:
Eligible
G:
Gasoline
TB:
Ineligible
K:
Kerosene
UK:
Existence
unknown
at
time
UO:
Used
Oil
*:
Tank
5
was
erroneously
included
in
the
calculations.
**:
Tank
7’s
volume
was
erroneously
calculated
at
500
gallons
instead
of
the
correct
1,000
gallons.
Ratio
of
total
eligible
tank
volume
to
total
tank
volume
=
12,000
/
21,500
=
0.558
14
Thus
55.8
14
of
eligible
costs
were
approved.
100
minus
55.814
=
44.186
=
percentage
of
eligible
costs
deducted
from
final
approval
of
costs.
1
Ratio
of
total
eligible
tank
volume
to
total
tank
volume
=
17,000
/
21,500
=
0.7907
Thus
79.07
of
eligible
costs
were
approved.
100
minus
79.07
=
20.93
percentage
of
eligible
costs
deducted
from
final
approval
of
costs.
Ratio
of
total
eligible
tank
volume
to
total
tank
volume
=
17,000
/
21,000
=
0.8095
Thus
80.95
of
eligible
costs
were
approved.
100
minus
80.95
=
19.05
=
percentage
of
eligible
costs
deducted
from
final
approval
of
costs.
‘~
IP~
1~5~1
~
~
~I~1o~’
-ii’.:
Gall~?~
000
,0
0
4,000
4,000
~
,000
~1~00
~
~~,000
•
1,000
1,00Q
500
conten:.~k..-D,.~.~..
G
•,G
•..G.l:~.-~iG
-K.;-,~.
C
•
~
~G..
UO.
Tank
5
was
erroneously
included
in
the
calculations.
**:
Tank
7’s
volume
was
erroneously
calculated
at
500
gallons
instead
of
the
correct
1,000
gallons.
*
*:
Tank
7’s
volume
was
erroneously
calculated
at
500
gallons
instead
of
the
correct
1,000
gallons.
2
-
CERTIFICATE OF SERVICE
I, the undersigned attorney at law, hereby certify that on May 11, 2005, I served true and
correct copies of a RESPONSE TO MOTION FOR SUMMARY JUDGMENT AND CROSS
MOTION FOR SUMMARY JUDGMENT, MOTION TO STRIKE, and MOTION FOR LEAVE
TO FILE INSTANTER, by placing true and correct copies in projerly sealed and addressed
envelopes and by sending via First Class U.S. Mail delivery to the following named persons:
Dorothy M. Gunn, Clerk
Diana M. Jagiella
Illinois Pollution Control Board
Howard & Howard
James R. Thompson Center
One Technology Plaza
100 West Randolph Street
Suite 600
Suite 11-500
211 Fulton Street
Chicago, IL 60601
•
Peoria, IL 61602-1350
Carol Webb, Hearing Officer
Illinois Pollution Control Board
1021 North Grand Avenue, East
P.O .Box 19274
Springfield, IL 62794-9274
ILLINOI
NVIRONMENTAL PROTECTION AGENCY,
Res ond
.Gm
Assistant Counsel
Special Assistant Attorney General
Division of Legal Counsel
1021 North Grand Avenue, East
P.O. Box 19276
Springfield, Illinois 62794-9276
217/782-5544
217/782-9143 (TDD)
