BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
OF THE STATE OF ILLINOIS
MIDWEST GENERATION, LLC, )
WILL COUNTY GENERATING STATION )
)
Petitioner, )
) PCB No. 2006-156
v. ) (Permit Appeal - Air)
)
ILLINOIS ENVIRONMENTAL )
PROTECTION AGENCY, )
)
Respondent. )
NOTICE
To: Dorothy Gunn, Clerk Sheldon A. Zabel
Illinois Pollution Control Board Kathleen C. Bassi
100 West Randolph Street Stephen J. Bonebrake
Suite 11-500 Kavita M. Patel
Chicago, Illinois 60601 Schiff Hardin, LLP
6600 Sears Tower
Bradley P. Halloran 233 South Wacker Drive
Hearing Officer Chicago, Illinois 60606
James R. Thompson Center,
Suite 11-500
100 West Randolph Street
Chicago, Illinois 60601
PLEASE TAKE NOTICE that I have today electronically filed with the Office of
the Clerk of the Illinois Pollution Control Board the
MOTION FOR LEAVE TO FILE
SURREPLY AND SURREPLY
of the Respondent, Illinois Environmental Protection
Agency, a copy of which is herewith served upon the assigned Hearing Officer and the
attorneys for the Petitioner.
Respectfully submitted by,
_____/s/______________
Robb H. Layman
Assistant Counsel
Dated: May 26, 2006
Illinois Environmental Protection Agency
1021 North Grand Avenue East
P.O. Box 19276
Springfield, Illinois 62794-9276
(217) 524-9137
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
OF THE STATE OF ILLINOIS
MIDWEST GENERATION, LLC, )
WILL COUNTY GENERATING STATION )
)
Petitioner, )
) PCB No. 2006-156
v. ) (Permit Appeal - Air)
)
ILLINOIS ENVIRONMENTAL )
PROTECTION AGENCY, )
)
Respondent.
MOTION FOR LEAVE TO FILE SURREPLY
NOW COMES the Respondent, ILLINOIS ENVIRONMENTAL PROTECTION
AGENCY (“Illinois EPA” or “Respondent”), by and through its attorneys, and moves the
Illinois Pollution Control Board (“Board”) for leave to file a Surreply to the Petitioner’s,
MIDWEST GENERATION, LLC, (hereinafter “Midwest Generation” or “Petitioner”),
recent responsive pleading concerning its Request for Stay. In support of this Motion, the
Respondent states as follows:
1. On March 3, 2006, the Illinois EPA granted a construction permit,
Construction Permit No. 06020009, to Midwest Generation for the construction of new
wet dust extractor control devices for the Unit 3 and Unit 4 coalAs part of its Petition,
Dynegy Midwest sought a stay of the effectiveness of the entire CAAPP permit.
2. On or about April 7, 2006, Petitioner filed a petition with the Board
seeking an appeal of the Illinois EPA’s permitting decision. The Illinois EPA received an
electronic version of the appeal on the same date. Formal notice of the appeal was served
on the Illinois EPA on April 11, 2006.
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
3. The Illinois EPA electronically filed a Response in Opposition to the
Petitioner’s Request for Stay with the Board on April 25, 2006.
4. On or about May 12, 2006, Petitioner filed a Motion for Leave and an
accompanying Reply to the Illinois EPA’s Response in Opposition to Petitioner’s
Request for Stay with the Board. The Illinois EPA received an electronic version of the
appeal on the same date. Formal notice of the appeal was served on the Illinois EPA on
May 15, 2006.
5. In accordance with the Board’s procedural requirements, the Illinois EPA
possesses no formal right to file additional responsive pleadings except as may permitted
by the Board or a hearing officer to prevent material prejudice. Any such reply or
surreply must be filed with the Board within 14 days after service of the response.
See,
35 Ill. Adm. Code 101.500(e).
6. In its recent Reply, Petitioner asserts several legal-related arguments
concerning the Illinois Administrative Procedure Act (“APA”),
5 ILCS 100/10-
65(b)(2004),
that are, in fact, misstatements of applicable law. This filing is necessary to
avoid undue prejudice arising from those misstatements. The Board has previously held
that a surreply is an appropriate filing when brought to correct misstatements contained
in briefing documents.
See, Illinois Ayers Oil Company v. Illinois EPA, PCB No. 03-
214, UST Appeal (August 5, 2004).
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
WHEREFORE,
the Illinois EPA respectfully seeks leave from the Board to file
the attached Surreply in the above-captioned matter.
Respectfully submitted by,
ILLINOIS ENVIRONMENTAL
PROTECTION AGENCY,
_____/s/______________
Robb H. Layman
Assistant Counsel
Dated: May 26, 2006
Illinois Environmental Protection Agency
1021 North Grand Avenue East
P.O. Box 19276
Springfield, Illinois 62794-9276
(217) 524-9137
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
OF THE STATE OF ILLINOIS
MIDWEST GENERATION, LLC, )
WILL COUNTY GENERATING STATION )
)
Petitioner, )
) PCB No. 2006-156
v. ) (Permit Appeal - Air)
)
ILLINOIS ENVIRONMENTAL )
PROTECTION AGENCY, )
)
Respondent. )
SURREPLY
NOW COMES the Respondent, ILLINOIS ENVIRONMENTAL PROTECTION
AGENCY (“Illinois EPA”), by and through its attorneys, and files this Surreply to correct
several misstatements expressed by the Petitioner, MIDWEST GENERATION, LLC,
(hereinafter “Midwest Generation” or “Petitioner”), in its Motion for Leave and an
accompanying Reply (“Reply”) to the Illinois EPA’s Response in Opposition to
Petitioner’s Request for Stay filed with the Illinois Pollution Control Board (“Board”) on
May 12, 2006.
ARGUMENT
In its Reply, Petitioner challenges certain assertions that were presented in the
Illinois EPA’s Response in Opposition to the Petitioner’s Request for Stay (“Response”)
that was filed with the Board on April 25, 2006. The focus of the relevant issue is the
automatic stay, contested case and waiver provisions of the Illinois Administrative
Procedure Act (“APA”),
5 ILCS 100/10-5-10/70 (2004).
As set forth below, certain
arguments raised by Petitioner in its Reply misstate applicable law and should therefore
be rejected by the Board in its consideration of the pending Request for Stay.
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
2
I. The permitting decision challenged on appeal does not involve a state
operating permit for the Will County Generating Station.
In its Response, the Illinois EPA urged the Board to reject Petitioner’s argument
that the APA’s automatic stay provision applies to the state construction permit
challenged here on appeal. The Illinois EPA sought to distinguish between the state
operating permits issued under the Illinois’ Title V program, which represented a new
type of license for an on-going activity, from the current state construction permit for a
new emissions control equipment. It is the Illinois EPA’s position that a state
construction permit is not the type of new license for a continuous activity that is
encompassed by the APA’s automatic stay provision.
See, 5 ILCS 100/10-65(b)(2004).
Petitioner argues in its Reply that the construction permit issued by the Illinois
EPA on March 3, 2006, was, in essence, a combined construction and operating permit.
According to Petitioner, the permitting decision included conditions relating to existing
emissions sources (i.e., coal bunkers) and was not confined to the installation of new wet
dust extractor control devices. To the extent that the permit addresses an “activity of a
continuing nature,” Petitioner reasons that the appealed permit is both a construction and
operating permit, thus falling within the ambit of the APA’s automatic stay provision.
Petitioner’s argument misconstrues the permitting requirements for CAAPP emission
sources.
Contrary to Petitioner’s assertion, the Illinois EPA does not argue that “there is no
activity of a continuing nature” relative to the subject permit. Indeed, Petitioner is correct
to observe that certain conditions of the construction permit, namely those relating to the
“affected operations,” necessarily assume an operational aspect. This characteristic of a
construction permit is perhaps owing to the fact that the addition of control equipment to
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
3
an existing operation cannot usually occur without, in some way, affecting the existing or
affected emission units. It is also consistent with the Board’s permitting regulations,
which require a permittee seeking a construction permit for control equipment to submit
information in its application concerning “processes to which the… air pollution control
equipment is related.”
See,
35 Ill. Adm. Code 201.152.
While a construction permit may possess certain operational attributes, it does not
magically convert a construction permit into an operating permit. The relevant
permitting regulations speak in terms of permit type. Midwest Generation sought and
obtained a construction permit for the installation of new wet dust extractor control
devices.
See generally
, Administrative Record at pages 1-92, 95-109 and 152-164. The
company did not seek, and the Illinois EPA, in its discretion, did not issue, a joint
construction and operating permit authorized by 35 Ill. Adm. Code 201.163.
Furthermore, CAAPP emission sources are required to obtain a construction permit for
new emission sources or control equipment but are not subject to the requirements for
obtaining a garden-variety operating permit.
See,
35 Ill. Adm. Code 201.207. In this
situation, the relevant permitting scheme for CAAPP emission sources envisions a
subsequent amendment to an existing CAAPP permit, not the issuance of a state
operating permit. Thus, Petitioner’s notion that it has obtained an operating permit
through the vessel of a construction permit is fallacious.
Petitioner’s argument also reads too much into the APA’s statutory scheme. The
APA does not expressly contemplate a bifurcated licensing process where one portion of
the permit is subject to the APA’s requirements and the other portion is not. While the
concept bears some resemblance to the Board’s discretionary stay authority, in which
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
4
certain conditions of the permit can be stayed but others are not, nothing in the APA’s
language indicates that the automatic stay provision can apply on a partial basis. Rather,
the focus of the provision is again placed on permit type, which, in the present context,
means a permit renewal or a new permit for existing sources. The permit appealed in this
proceeding does not satisfy either of these two types of permit. As previously mentioned,
Petitioner made an unambiguous request for a construction permit for new control
equipment, not an operating permit, and the Illinois EPA subsequently granted the
Petitioner’s request consistent with the permitting scheme devised by the Board for
CAAPP emission sources.
II. The present appeal is not a “contested case” under the APA and, as
such, Petitioner cannot repudiate the plain meaning of the statute’s
waiver provision.
Petitioner appears befuddled by the Illinois EPA’s argument concerning the
separate nature of the APA’s licensing and contested case provisions. The main thrust of
the Illinois EPA’s position is that the APA’s waiver provision only authorizes a waiver of
the contested case procedures, not the licensing procedures that have been presented in
both this proceeding and the separate CAAPP appeals involving Midwest Generation and
the other coal-fired power plants. As such, the Illinois EPA argued that Petitioner’s
reliance upon prior Board
dicta
concerning waiver of the APA’s automatic stay provision
is misplaced.
Petitioner attempts to refute the Illinois EPA’s argument by contending that the
present appeal is, in and of itself, a “contested case.” This argument is erroneous.
Permitting decisions under the Illinois Environmental Protection Act (“Act”), as where
the Illinois EPA issues a permit that is then appealed to the Board, are only subject to the
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
5
APA’s contested case procedures if and when the relevant permitting “is required by law
to be preceded by notice and an opportunity for a hearing.”
See,
5 ILCS 100-10-
65(a)(2004). The focal point of this language lies with the requirements that
accompanying the Illinois EPA’s permitting issuance, not the Board’s consideration of
whether a particular permit issued by the Illinois EPA can be sustained and made final on
appeal. Section 40(a)(1) certainly does not satisfy the two-prong requirement. While the
provision may afford a permittee an opportunity for a hearing before the Board in
contesting the Illinois EPA’s permit decision, it is silent with respect to any kind of
notice.
Even if the present proceeding was governed by the contested case proceedings,
Petitioner’s argument is completely irrelevant as to whether the APA’s automatic stay
provision can be waived under Section 10-70. Perhaps Petitioner’s argument was simply
meant to obfuscate the differences between the APA’s contested case and licensing
procedures. In either event, Petitioner’s argument offers nothing to refute the Illinios
EPA’s proffered interpretation of the APA’s waiver provision. .
III. The Illinois EPA generally accepts Petitioner’s alternative proposal
for staying certain contested conditions of the construction permit.
In responding to the Illinois EPA’s contention that the pending request for stay is
overly-broad, the Petitioner has stated that it is alternatively agreeable to a partial stay, as
authorized through the exercise of the Board’s discretionary stay authority, of the
appealed construction permit. To this end, Petitioner attached a redlined version of the
construction permit to its latest Motion that identifies the contested conditions of the
permit that would be stayed if the Board does not find a blanket stay of the entire permit
warranted.
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
6
Upon review, and subject to only one limited exception, the Illinois EPA is
prepared to accept the Petitioner’s attachment as an accurate representation of conditions
currently being challenged on appeal. The one exception involves Condition 9(b)(i)(A),
which Petitioner contends is not susceptible to identification through redlining. Instead
of addressing its issue through redlining, Petitioner offers to “interpret the condition to
imply that the five six-minute periods identified in the condition are consecutive.”
See,
Reply at page 8. Unless the Illinois EPA has misunderstood Petitioner’s explanation, the
Illinois EPA is troubled by this approach.
In its appeal, Petitioner contends that certain references in the challenged
provision are inconsistent, but ultimately concludes that the use of the word
“consecutive” in the second reference to the permit condition is appropriate.
See,
Petition at pages 12.
In the redlined version of the contested permit conditions, the
existing language of the “five or more 6-minute averaging periods” is retained but the
parenthetical language for the “five consecutive 6 minute averaging period” is redlined.
If Petitioner contends that the former reference should include the term “consecutive,”
then it might be more appropriate to show that language as being contested, and thus
stayed, even if it leaves the remaining part of the condition without meaning. Otherwise,
a part of the permit that will not subject to a stay will remain subject to different
interpretation; one reflected by the existing language that lacks the term “consecutive”
and the other by Petitioner’s “implied” insertion of the term.
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
7
WHEREFORE,
the Illinois EPA reiterates it request that the Board deny
Petitioner’s request for an automatic stay under the authority of the Illinois APA and,
further, that the Board exercise its discretionary stay authority to stay only the contested
conditions of the permit, consistent with the views expressed herein, or order such other
relief as is deemed just and appropriate.
Respectfully submitted by,
ILLINOIS ENVIRONMENTAL
PROTECTION AGENCY,
_____/s/______________
Robb H. Layman
Assistant Counsel
Dated: May 26, 2006
Illinois Environmental Protection Agency
1021 North Grand Avenue East
P.O. Box 19276
Springfield, Illinois 62794-9276
(217) 524-9137
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006
CERTIFICATE OF SERVICE
I hereby certify that on the 26
th
day of May 2006, I did file, by electronic mail, the
following instruments entitled
MOTION FOR LEAVE TO FILE SURREPLY and
SURREPLY
to:
Dorothy Gunn, Clerk
Illinois Pollution Control Board
100 West Randolph Street
Suite 11-500
Chicago, Illinois 60601
and further, that I arranged for a true and correct copy of the same foregoing instruments
to be sent, on the 30
th
day of May 2006, by First Class Mail with postage thereon fully
paid and deposited into the possession of the United States Postal Service, to:
Bradley P. Halloran
Hearing Officer
James R. Thompson Center
Suite 11-500
100 West Randolph Street
Chicago, Illinois 60601
Sheldon A. Zabel
Kathleen C. Bassi
Stephen J. Bonebrake
Joshua R. More
Kavita M. Patel
Schiff Hardin, LLP
6600 Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
_____/s/______________
Robb H. Layman
Assistant Counsel
ELECTRONIC FILING, RECEIVED, CLERK'S OFFICE, MAY 26, 2006