CERTIFICATE OF SERVICE
A. Supporting Data
V. CONCLUSION

RECEIVED

CLERK’S OFFICE

JUL

BEFORE THE ILLINOIS POLLUTION CONTROL BOARD

STATE OF ILLINOis

ll’4

THE MATTER OF:

)

Pollution Control Board

)

PROPOSED AMENDMENTS TO

)

R05-19

EXEMPTIONS FROM STATE

)

(Rulemaking

Air)

PERMITTING REQUIREMENTS

)

(35ILLADM.CODE2O1.146)

)

NOTICE OF FILING

TO:

Ms. DorothyM.

Gunri

Ms.

Amy Antoniolli

Clerk ofthe Board

Hearing Officer

Illinois Pollution Control Board

100 West Randolph Street

100

West Randolph Street

Suite 11-500

Chicago, Illinois 60601

Chicago, Illinois

60601

(VIA FIRST CLASS MAIL)

(VIA FIRST CLASS

MAIL)

(PERSONS ON ATTACHED SERVICE LIST)

PLEASE TAKE NOTICE that I have today filed with the Office ofthe Clerk of

the Illinois Pollution Control Board an original

and nine

copies ofthe POST-HEARING

COMMENTS OF THE ILLINOIS ENVIRONMENTAL REGULATORY GROUP

IN SUPPORT OF R05-19, a copy of which is herewith served upon you.

Respectthlly submitted,

ILLINOIS ENVIRONMENTAL

REGULATORY GROU~

By:JOSa

£k~

One ofIts Attorneys

Dated:

July

14, 2005

N. LaDonna Driver

Robert A. Messina

Jeanne B. Heaton

General Counsel

HODGE DWYER ZEMAN

Illinois Environmental Regulatory Group

3150

Roland Avenue

3150 Roland Avenue

Post Office Box

5776

Post Office Box 5776

Springfield,

Illinois

62705-5776

Springfield,

Illinois

62705-5776

(217) 523-4900

(217) 523-4942

THIS FILING SUBMITTED ON RECYCLED PAPER

CERTIFICATE

OF SERVICE

I, N. LaDonna Driver, the undersigned, certify that I have served the attached

POST-HEARING COMMENTS OF THE ILLINOIS ENVIRONMENTAL

REGULATORY GROUP IN

SUPPORT OF R05-19 upon:

Ms. Dorothy M. Gunn

Clerk ofthe Board

Illinois Pollution Control Board

100 West Randolph Street, Suite

11-500

Chicago, Illinois

60601

Howard Chinn

Chief Engineer

Environmental Bureau

Office ofthe Attorney General

188 West Randolph Street,

20th

Floor

Chicago, Illinois

60601

Charles E. Matoesian

Assistant Counsel

Illinois

Environmental Protection Agency

1021 North Grand Avenue East

Post Office Box

19276

Springfield, Illinois

62794-9276

Roy M. Harsch, Esq.

Gardner, Carton & Douglas, LLP

191

North Wacker Drive,

Suite 3700

Chicago, Illinois

60606-1698

Mr. Christopher W. Newcomb

Karaganis, White & Magel, Ltd.

414 North Orleans Street, Suite 810

Chicago, Illinois

60610

D. Volz

OSF Healthcare Systems

800 NE Glen Oak Avenue

Peoria, Illinois

6 1603-3200

Amy Antoniolli

Hearing Officer

Illinois Pollution Control Board

100 West Randolph Street, Suite 11-500

Chicago, Illinois

60601

Rosemarie

Cazeau, Esq.

Bureau Chief

Environmental Bureau

Office of the Attorney General

188 West Randolph Street, 20ul~Floor

Chicago, Illinois

60601

Annet

Godiksen

Legal Counsel

Illinois Environmental Protection Agency

1021

North Grand Avenue East

Post Office Box

19276

Springfield, Illinois

62794-9276

Steven J. Murawski, Esq.

Gardner, Carton &

Douglas, LLP

191

North Wacker Drive, Suite 3700

Chicago, Illinois

60606-1698

Mr.

Michael Severns

Bodine Environmental Services, Inc.

5350 East Firehouse Road

Decatur, Illinois

62521-9601

Ms.

Patricia F. Sharkey

Mayer,

Brown, Rowe & Maw, LLP

South Wacker Drive

Chicago, Illinois

60606

Mr. Bruce Nilles

Attorney

Sierra Club

214 North Henry, Suite 203

Madison, Wisconsin

53703

Mr. Rodney Harper

Rush Oak Park Hospital

520 South Maple Avenue

Oak Park, Illinois

60304

by depositing said documents in the United States Mail, postage prepaid, in

Springfield,

Illinois, on July

14, 2005

N. LaDonna Driver

BEFORE THE ILLINOIS POLLUTION CD

~C)ARD

LEffi(S OFflCE

INTHEMATTEROF:

)

ju~\920C5

PROPOSED AMENDMENTS TO

)

RJI54~F

iLLINO’~

EXEMPTIONS FROM STATE

)

~fi~tS*innVOl

~,r

PERMITTING REQUIREMENTS

)

(35 ILL. ADM. CODE 201.146)

)

POST-HEARING COMMENTS OF

THE ILLINOIS ENVIRONMENTAL REGULATORY GROUP

UPON PROPOSED AMENDMENTS TO 35 ILL. ADMIN. CODE 201.146

NOW

COMES HODGE DWYER ZEMAN, on behalfof the ILLINOIS

ENVIRONMENTAL REGULATORY GROUP (“IERG”), and provides the following

comments

on the proposed amendments to 35 Ill.

Admin.

Code

201.146.

INTRODUCTION

IERG is a not-for-profit Illinois corporation comprised of

member companies

engaged in industry, commerce, manufacturing, agriculture, trade, transportation or other

related activities

regulated by governmental agencies that promulgate, administer or

enforce environmental

laws, regulations, rules or other policies.

IERG was organized to

promote and advance the interests of its members before governmental agencies such as

the Illinois Environmental Protection Agency (“Illinois EPA”) and the Illinois Pollution

Control Board (“Board”).

IERG is also an

affiliate of the Illinois State Chamber of

Commerce, which has more than 5,000

members in the State.

A number of IERG

member companies conduct activities governed by the regulations set forth in 35

Ill.

Admin. Code

201.146.

IERG would like to thank the Board for the opportunity to participate in the

April

12, 2005,

and June

14,

2005, hearings’

held on the proposed rulemaking.

IERG

also appreciates this opportunity to makethe following additional comments upon the

proposed amendments to 35

III. Admin. Code

20 1.146.

II.

SUMMARY

OF PROPOSAL

The proposed rulemaking seeks to add four categories to the permit exemptions in

Ill. Admin.

Code

201.146.

The requirements for obtaining state construction and

operating permits are extremely broad.

See

Ill. Admin. Code

201.142 and

201.143.

Sources sometimes wait for months for construction permits.

35111. Admin.

Code

201.146 provides state permit exemptions on

a category basis only.

There is

permit exemption for projects that have emissions below a certain

level.

Also,

there is no

permit exemption for pollution control equipment or for insignificant activities

under the

Title V program.

The provisions

in this proposal seek to address these problems with

Section 201.146.

IERG has worked closelywith

Illinois EPA to formulate these

additional permit exemptions.

The parties believe that the proposed permit exemptions

will eliminate unnecessary permitting burdens for Illinois

EPA and regulated

sources

while being protective ofthe environment.

Proposed subsection (hhh) would allow the replacement or addition ofair

pollution control equipment in certain limited circumstances, such as where the existing

unit being replaced is already permitted by Illinois EPA, has operated in compliance, will

provide equal or better emission control and will have the required monitoring

equipment, etc.

All references

to “Tr. at

“refer to the transcript for the April

12, 2005, hearing.

The second and third new categories ofpermit exemptions are proposed

subsection (iii), pertaining to Federally Enforceable State Operating Permits (“FESOP”)

sources and proposed subsection (jjj), pertaining to

Lifetime Operating Permit

sources.

These provisions allow permit exemptions in similar circumstances.

The replacement,

addition or modification ofnew emission units would be allowed when a series of criteria

are satisfied, including when the potential emissions

from the project are less thaita very

low threshold amount, when there is no change to the source’s status as a nonmajor

source under Title V, when specified federal requirements are not triggered, and when

there are no outstanding specified compliance and enforcement matters.

Both

subsections (iii) and (jjj) have other source-specific restrictions, such as the hazardous air

pollutant limit for the FESOP source exemption in subsection (iii) and the prior

notification requirement for emissions

increases ofcertain levels for Lifetime Operating

Permit sources in

subsection (jjj).

Finally, the fourth proposed exemption, subsection (kkk), pertains to Clean Air

Act Permit Program (“CAAPP”) sources.

The proposal will allow CAAPP sources to

construct or modify an emission unit or activity that

is an insignificant activity without a

construction permit.

The exemption clarifies that the source must still satisfy existing

notification and

compliance requirements.

III.

JUSTIFICATION

ERG has stated its

support for this

proposed rulemaking in its previous filings

and testimony before the Board

in this matter.

However, IERG would like

re-emphasize its rationale for supporting this important first

step in the process of

improving the Illinois air permitting system.

Supporting Data

Data provided by the Illinois EPA in its “Answers to

Questions Raised at the

April

12, 2005 Hearing” confirms our prior analysis of earlier data by showing that the

vast majority of all construction permits issued by the Illinois EPA in

2003

and 2004

went to facilities where there was no emissions increase or an emissions increase ofless

than one ton per year.

This finding confirms our earlier conclusion that there is a

significant need to eliminate a large percentage of such construction permits.

Additionally, analysis of airpermitting data from surrounding states

reveals that

many states are recognizing the benefits of exempting minor emission increases from the

traditional permitting review system.

In fact, all other Region V states, except Illinois,

have some form of a

de minimis

permitting

exemption and many ofthose states have

established classes of permits for similar sources, sometimes called general permits, and

streamlined permitting review processes for sources with low emissions, sometimes

called registration-onlypermits.

($~

Exhibit #2 from “Pre-Filed Testimony of

Katherine D. Hodge on Behalf of the Illinois Environmental Regulatory Group in

Support of R05-19” filed with the Board on April 4,

2004.)2

It is clear from the changes occurring in other states that a much needed shift is

occurring—a shift from a system that takes the same approach to permitting

all types of

activities, to

a system that targets permitting resources to a level that is more appropriate

In preparation ofthis comment, IERG has reviewed the

status ofthe state provisions in this exhibit, to

ensure

that all

information there is still current.

All information in the exhibit remains current except for

footnote 2

for the Ohio provisions.

We have been informed

by personnel at Ohio EPA that the proposal

at issue

in that

footnote

has been put on

hold.

In addition, ERG

investigated Sierra Club’s reference to

USEPA’s concerns with Act 118, referenced at Section III of the

Wisconsin information in Exhibit 2.

Our

discussions with Wisconsin DNR revealed that while USEPA had initial questions and/or concerns with the

statute, Wisconsin DNR has been working with USEPA to resolve those

issues and the rulemaking

implementing Act

118

is scheduled to be

finalized in September.

to the regulatory or emissions consequence of a proposed activity.

Because USEPA has

approved the permit streamlining initiatives

in otherRegion V states, which in some

cases, involve

much higher emission thresholds, USEPA should certainly approve the

provisions at issue in this proceeding.

Benefits

By the elimination of full permitting review for minor projects, more Illinois EPA

resources will be freed up to

concentrate on permit actions involving something more

than minimal emissions.

This would allow

reallocation of Agency resources away from

merely processing routine permits, to

a greater focus on projects with greater emission

and regulatory ramifications.

Additionally, facilities eligible

to proceed with minor projects under the proposed

exemptions will be freed from burdensome and costly delays that often occur

in the

lengthy permitting process.

This will provide greater operational flexibility for facilities,

with little

orno

cost to the environment,

due to the minimal nature ofthe emissions

involved.

Further, the environment would benefit from proposed subsection (hhh).

This

provision would allow a facility to replace or add air pollution control equipment quickly,

rather than waiting for full permit review.

Thus, this proposal eliminates permit hurdles

that can unnecessarily delay the air quality benefit that may be realized by installing and

operating air pollution control equipment.

Safeguards

Although some questions havebeen raised by Sierra Club about the proposed

amendments, the safeguards in the proposed regulatory language counteract these

concerns.

First, it should be emphasized that the exemptions themselves would not

cause increased emissions of any pollutants.

Even without the availability of these permit

exemptions, there is little question that for a facility seeking to accomplish one ofthe

activities covered by the proposed exemptions, Illinois EPA would,

upon review of a

permit application, routinely issue a permit.

So, with or without the permit exemption,

the project would be done with a potential consequence of very little or no emissions

increase.

The proposed exemptions would simply remove the requirement to

secure the

permit before the project begins; thus, the impact on the environment is the same with or

without the exemption.

Additionally, the four proposed exemptions are narrowly directed to

circumstances when a state construction or operating permit will not be required.

The

permit

exemptions are in no way exemptions from other substantive regulatory

requirements. For example, although

a new emission

unit

may qualify for one ofthe

proposed exemptions, compliance would still

be required with substantive provisions that

target particular pollutants at Parts

212-219 ofthe Board’s regulations.

As a second safeguard, the existing introductory language in

Section 201.146 will

also be applicable to the proposed amendments.

That language specifically states that the

permitting exemptions do not relieve the source

from obligations to comply with any

other applicable requirements, including obligations for obtaining permits

as required by

nonattainment New Source Review (“NSR”), Prevention ofSignificant Deterioration

(“PSD”), New

Source Performance Standards (“NSPS”) or National Emission Standards

for Hazardous Air Pollutants (“NESHAP”).

Applicability for these federal requirements

may trigger from the project’s potential emission increases, or applicability canbe

emissions-neutral

in that a certain activity

in a project will bring about compliance and

permit requirements. When these federal

obligations exist, traditional permitting

procedures apply and the

exemptions will be unavailable for the project. ~

Similarly, the proposed permit exemptions themselves contain provisions that

prevent their use where

federal obligations would ultimately be

triggered, including by

cumulative emissions increases at the facility.

For example, proposed subsection

(hhh)(4) prohibits use of the pollution control equipment exemption where different

regulatory requirements would apply (e.g., NSPS).

Also, subsection (jjj)(2) prohibits use

of the permit exemption where NESHAP requirements apply (e.g., potential HAP

emissions

at the facility reach major source thresholds).

Subsection (iii)(4) prohibits use

ofthe permit exemption at FESOP sources where the project would, in

addition to other

emissions at the facility, trigger nonattainment NSR or PSD requirements,

or the need

for a revised FESOP limiting potential to

emit.

Subsection (jjj)(3) prohibits use of the

permit exemption at Lifetime

Operating Permit sources where the project would, in

addition to

other emissions at the facility, trigger Title V permit requirements, either for a

CAAPP permit or a FESOP.

Thus, triggers for federal regulatory and permit

requirements, including for cumulative emissions, are more than adequately provided for

the permit exemptions.

A third safeguard ofthe proposal is the compliance requirement in subsections

(hhh), (iii) and (jjj).

Unlike other currently existing exemptions

in Section 201.146, the

proposed exemptions prevent the use of the exemption if there is a pending specified air

Notably, the

industries raised by

Sierra Club repeatedly in the April hearing, medical waste incinerators

and utilities, are

regulated by NSPS,

and would, of course, have potential coverage

for a given project

under nonattainment NSR or PSD.

emissions compliance

inquiry or enforcement action involving the source, even if the

compliance inquiryor enforcement action is completely unrelated to the emission unit at

issue in the proposed project.

This requirement sets a particularly high standard for using

the exemption, certainly more stringent than that placed on currently existing exemptions

Section 201.146.

Another safeguard is the prior notice requirement of proposed subsection

(jjj)(1)(b) for Lifetime Operating Permit sources.

When emissions are projected to be

more than 0.1

pound

per hour but less than 0.5 pound per hour, before initiating the

proposed project, the facility must notify the Illinois EPA.

Again, this

is a more stringent

requirement than is currently found in any ofthe existing exemptions in

Section 201.146.

There was a concern voiced by Sierra Club at the April hearing that Illinois EPA

might not know whether a project qualifies for a permit exemption until after the project

is completed.

IERG would like

to re-emphasize that this approach is standard across all

of the current permit exemptions, because Illinois EPA does not typically inspect a

facility prior to issuing

a permit.

The burden of determining proper use of a permit

exemption and the risk that the Illinois

EPA will later disagree with that determination

are on the facility using the exemption.

As Mr. Sutton stated in his testimony, the use of

the exemption does not shield the facility from future enforcement, if in fact, the facility

incorrect about

project

emissions

and

use of the permit exemptions.

Tr. at

110.

Clearly, the safeguards drafted

into

the proposed

amendments

Section 201.146

are

than adequate to address the concerns that have been raised.

The proposal is

narrowly

crafted

to capture those

minor

emission projects that

not rise to the

level

needing full permit review.

CONCLUSION

For the reasons discussed above, IERG urges the Board to

adopt the proposed

amendments to

35111. Admin.

Code

201.146.

As discussed extensively in

the filings

and testimony,

IERG believes this proposal to begin the Illinois air permit streamlining

process will greatly benefit both industry and the Illinois EPA with little or no negative

impact on the environment.

A significant number of safeguards have been inserted into

the proposed amendments to allay concerns about compliance, emission increases, etc.

Additionally, the proposal will begin to move the Illinois

air permitting system

direction more consistent with the air permitting systems ofneighboring Region V states.

Respectfully

submitted,

ILLINOIS ENVIRONMENTAL

REGULATORY GROUP,

By~&~

One of Its Attorneys

Dated:

July

14, 2005

N. LaDonna Driver

RobertA. Messina

HODGE DWYER ZEMAN

Illinois Environmental Regulatory Group

3150 Roland Avenue

Post Office Box 5776

Springfield, Illinois

62703

Springfield,

Illinois

62705-5776

(217) 523-4942

(217) 523-4900

IERG:OOl/R Dockets/Filings/R05-19/Filings/CommentsPre-first notice.doc