1. NOTICE OF FILING
      2. FOR EXTENSION OF ADJUSTED STANDARD
      3. INTRODUCTION
      4. I. QUESTIONS POSED BY THE BOARD
      5. II. DISCUSSION OF ADDITIONAL ISSUES RAISED AT THE HEARING
      6. A. The Board Should Not Ignore Facts Related To The Piasa Creek Watershed
      7. Project
      8. The Agency's Position In This Case Is Not Based On A Best Professional
      9. Judgment Analysis
      10. c. Neither State Regulations Nor State or Federal Policies Prohibit Illinois-
      11. American Water's Use Of An Offset Project
      12. D. The Board Should Not Accept The Agency's Unsupported Interpretation Of
      13. USEPA Policy
      14. E. Requiring Treatment Would Be Detrimental to the Environment
      15. F. Another Sunset Period Is Unnecessary
      16. G. Send the Right Message to the Regulated Community, the Public, and to
      17. Other States and Regulatory Agencies
      18. CONCLUSION
      19. CERTIFICATE OF SERVICE
      20. EXHIBIT
      21. EXHIBIT
  1. IllinoisAmerican Water®
  2. Piasa Creek Watershed Project
    1. A Successful Partnership
    2. Between Industry, Environmentalists
  3. IllinoisAmerican Water®
  4. Fact Sheet
      1. Alton District Treatment Plant
      2. Adjusted Standard Allowing Direct Discharge of Residuals
      3. water treatment plants.
      4. water treatment site.
      5. EXHIBIT
      6. AFFIDA.VIT UFCINDY BERENS,TOOlT

BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
IN THE MATTER OF:
)
)
PROPOSED EXTENSION OF ADJUSTED STANDARD )
APPLICABLE TO ILLINOIS-AMERICAN
)
WATER COMPANY'S ALTON PUBLIC WATER
)
SUPPLY FACILITY DISCHARGE
)
TO THE MISSISSIPPI RIVER
)
NOTICE OF FILING
AS 2007-2
(Adjusted Standard)
John Therriault, Assistant Clerk
Illinois Pollution Confrol Board
James R. Thompson Center
100 West Randolph Street, Suite 11-500
Chicago, Illinois 60601
William Richardson, ChiefLegal Counsel
Illinois Department
ofNatural Resources
One Natural Resource Way
Springfield, Illinois 62702
Matthew
J.
Dunn
Division Chief, Environmental Enforcement
Illinois Attorney General
100 West Randolph Street, 12
th
Floor
Chicago, Illinois 60601
Sanjay Sofat
Division
ofLegal Counsel
Illinois Environmental Protection Agency
1021 North Grand Avenue East
P.O. Box 19276
Springfield, Illinois 62794-9276
Carol Webb
Hearing Officer
Illinois Pollution Control Board
1021 North Grand Avenue East
P.O. Box 19274
Springfield, Illinois
62794-9p4
PLEASE TAKE NOTICE that on September 10, 2007, the PETITIONER ILLINOIS-
AMERICAN WATER COMPANY'SPOST-HEARING BRIEF IN SUPPORT OF ITS
AMENDED PETITION FOR EXTENSION OF ADJUSTED STANDARD was filed with the
Clerk
of the Pollution Control Board. A copy is herewith served upon you.
Respectfully submitted,
By:
Bradley
S.
H'
es, #03128879
Blackwell S ders LLP
720 Olive St., 24th Floor
St. Louis, MO 63101
Telephone: (314)345-6000
Facsimile: (314) 345-6060
An
Attorney for Petitioner
Electronic Filing, Received, Clerk's Office, September 10, 2007

BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
IN THE MATTER OF:
)
)
PROPOSED EXTENSION OF ADJUSTED STANDARD
)
APPLICABLE TO ILLINOIS-AMERICAN
)
WATER COMPANY'SALTON PUBLIC WATER
)
SUPPLY FACILITY DISCHARGE
)
TO THE MISSISSIPPI RIVER
)
AS 2007-2
(Adjusted Standard)
PETITIONER ILLINOIS-AMERICAN WATER COMPANY'S
POST-HEARING BRIEF
IN SUPPORT OF ITS AMENDED PETITION
FOR EXTENSION
OF ADJUSTED STANDARD
Petitioner, Illinois-American Water Company ("Illinois-American Water"), by its
attorneys, Bradley
S. Hiles and Alison M. Nelson, hereby submits its post-hearing briefin
support
of its Amended Petition For Extension Of Adjusted Standard.
INTRODUCTION
After the submittal of numerous pleadings and exhibits, and now the conclusion ofa
hearing, two issues remain dominant in the present case. The ftrst is an issue
of fact: Is the Piasa
Creek Watershed Project ("PCWP") showing "signs
of success" in achieving its 2 to 1 offset
goal by
201O? This issue has been resolved without dispute. The answer is "yes." The second
dominant issue in the present case is an issue
of law: Is the offset trading accomplished through
the PCWP "substantially and signiftcantly different" from the factors relied
on by the Board in
1972 in establishing the effluent limits
of general applicability for Total Suspended Solids (TSS)
and iron? That issue could be restated with a federal regulatory bent: Is the PCWP a "unique
factor"?
It
is, of course. This Board already made that determination in AS 99-6, and nothing
has changed since 1999 to alter that the validity
of that legal conclusion.
In
fact, the only
relevant change since this case originated in 1999 is that the success
ofthe PCWP has become an
undisputed fact.
1

Seven years ago, the Illinois Environmental Protection Agency (the "Agency")
acknowledged that the PCWP was a substantially and significantly different factor.
See
Opinion
&
Order ofthe Board, AS 99-6 at 9 (Sept. 7,2000). But there has been a changing ofthe guard
at the Agency. The Agency'snew spokesman now asks the Board to blindly apply its 1972
effluent standards
of general applicability, insisting that the PCWP success story is now
irrelevant and should be ignored. That reasoning is fatally flawed. The PCWP offset trading
project was the essence
of case AS 99-6, and remains the essence ofthe present action as well.
The success
of the project cannot be ignored. Illinois law governing adjusted standards cannot
be ignored, either. The "substantially and significantly different factor" analysis must, by
necessity, draw the Board to the PCWP.
The U.S. Environmental Protection Agency's ("USEPA's")water quality trading policy
does not impact the present case. That policy has not changed, in substance, since 1996.
It
has
never prohibited the issuance
of an adjusted standard on these facts, and should not prohibit the
extension
ofthe present adjusted standard now. Moreover, even ifUSEPA's policy could
somehow be read to send a negative message against this offset trading project - which it
cannot - the policy is not found in a statute or regulation. A published policy document
ofthis
nature simply lacks the force and effect
of law.
This briefaddresses the water quality trading policy issue and other matters raised at the
August 28, 2007 hearing. One matter, addressed first, was raised by a Board representative,
while the remaining issues were raised at the hearing by a witness or the Agency'scounsel.
I.
QUESTIONS POSED BY THE BOARD
At the hearing on August 28, 2007, Mr. Anand Rao, the Board'sSenior Environmental
Scientist, asked Illinois-American Water'switness Jeffrey
T. Kaiser whether the Kinkaid area's
2

water system uses lime softening as a part of its treatment process. (Tr.
1
28:17-22.) Mr. Kaiser
was unsure whether that water system uses lime softening, and stated that he would have to
review his notes to determine this. (Tr.28:23-29:5.) After conducting this review and
additional research, Mr. Kaiser has determined that the Kinkaid area'swater system does not use
lime softening as part
of its treatment process.
See
Affidavit of Jeffrey T. Kaiser (attached hereto
as Attachment A).
II.
DISCUSSION OF ADDITIONAL ISSUES RAISED AT THE HEARING
A.
The Board Should Not Ignore Facts Related To The Piasa Creek Watershed
Project
As a preliminary matter, Illinois-American Water believes it is wrong for the Illmois
Environmental Protection Agency (the "Agency") to brush aside the facts
ofthis case. Mr.
Sanjay Sofat, counsel for the Agency, stated at the Board hearing on August 28,2007, that
"discussions related to [the Piasa Creek Watershed Project and the associated offset] are
irrelevant to the question
of whether the Board should grant the requested relief' (Tr. at 16:2-4),
and that "[w]e are not here to talk about the project." (Tr. 79:24.) This is clearly belied by the
Agency'sfocus on the facts
of Illinois-American Water'scircumstances versus the facts
surrounding other water treatment facilities using nonpoint source projects to achieve soil
savings.
See
Agency Rec. at
~15
(discussing 6 facilities that the Agency claims as "additional
examples
of regulated facilities in the State that are conducting soil conservation projects to
protect source water without requesting relief from applicable effluent standards"). But as Mr.
Jeffrey Kaiser (Illinois-American Water's certified expert) explained in his prefiled testimony,
these facilities are not similar to Illinois-American Water'sAlton facility, because:
(1) the
1 The transcript from the August 28, 2007 hearing in this matter is referred to throughout the text of this briefas the
"Hearing Transcript" and in citations as "Tr." Also, the hearing exhibits admitted into evidence at the August 28,
2007 is this matter are referred to in citations as "Ex."
3

conditions necessary to maintain a viable water supply on the Mississippi River are much
different from those necessary in lakes; (2) the six point sources identified by the Agency have
used state and/or federal funds to conduct soil conservation measures; and (3) the sediment
reduction efforts for the six point sources are a matter
of business necessity or even survival in
some cases.
See
Ex. 3 at 6:1-6:12 (summarizing the purpose of his testimony). The Agency
would not have raised these factual "similarities"
if it did not believe the facts were relevant
B.
The Agency's Position In This Case Is Not Based On A Best Professional
Judgment Analysis
By ignoring the facts, the Agency would have this Board rely entirely on the regulation of
generally applicability. However, this position is inconsistent with even the regulatory principles
explained by the Agency at the hearing. As
Mr. Frevert acknowledges on behalf of the Agency,
there is no federal technology-based effluent limitation applicable to Illinois-American Water's
Alton facility.
See
Tr. 51 :3-4 ("There are no federal effluent guidelines for total suspended
solids and iron discharges") (answering the Board'squestion
#3 posed to the Agency). As Mr.
Frevert also acknowledges, federal regulations require that where there are no federal effluent
guidelines, the permitting authority may impose effluent limitations using the authority'sbest
professional judgment
(BPI). See id.
at 48:8-48: 11
("In
situations or activity classifications
where EPA has yet to promulgate effluent standards, the permitting authority must rely solely
upon case-by-case effluent limitations.") (answering the Board'squestion
#la posed to the
Agency);
see also id.
at 14:17-22 (statement of Mr. Sanjay Sofat) (stating that "in the absence of
a federal promulgated effluent limitation," the Agency'smethod of imposing technology controls
in permits is
"on a case-by-case basis according to EPA's best professional judgment").
Under 40 C.F.R. 125.3, a permitting authority imposing technology-based treatment
requirements must consider:
4

(i)
The appropriate technology for the category or class ofpoint sources of
which the applicant is a member, based upon all available information;
and
(ii)
Any unique factors relating to the applicant.
See
40 C.F.R. 125.3(c)(2), Exhibit 12. In the proceedings on AS 99-6, the parties agreed that
under BPJ, the appropriate technology-based effluent limit was "no treatment." Illinois-
American Water commissioned ENSR to perform a BPJ analysis
in 1999.
2
Regarding the best
practicable control technology (BPT) for the facility based
on consideration ofthe statutory
factors at 40 C.F.R. 125.3(d)(l) and unique factors relating to the applicant as required by 40
C.F.R. 125.3(c), ENSR determined through BPJ "that BPT for the proposed Alton replacement
facility is no treatment
ofTSS in the discharge."
See
SSIS at 6-17, Section 6.5.1.7. Regarding
the best conventional pollutant control technology (BCT) for the facility based
on consideration
of the statutory factors at 40 C.F.R. 125.3(d)(1) and unique factors relating to the applicant as
required by 40 C.F.R. 125.3(c), ENSR determined that "[a]pplication
of the candidate BCT
technology was not cost-reasonable" and thus "adoption
ofBCT effluent limitations in lieu ofthe
previously developed BPT effluent limitations [no treatment] is not warranted."
See
SSIS at 6-
20, Section 6.5.2.8. In summary, ENSR stated that "this BPJ evaluation
ofthe existing NPDES
effluent limitations concludes that the existing no effluent limitation is the appropriate control
technology under both BPT and BCT."
See id.
The Agency'samended recommendation
presented no opposition to this conclusion in the proceedings
on AS 99-6, and the Agency
similarly has not presented any opposition here.
2
ENSR'sanalysis is set forth at length in the Site Specific Impact Study (incorporated by reference into this
proceeding by the Board's order dated December 7, 2006).
See
SSIS at 6-15, Section 6.5 ("This section provides a
BPJ evaluation of the effluent limitations at the proposed replacement facility. Development ofBPT under BPJ is
provided in Section 6.5.1, through consideration ofthe regulatory factors contained in 40 CFR 125.3(d)(1).
Development of Best Conventional Technology (BCT) under BPJ is provided in Section 6.5.2, through
consideration ofregulatory factors contained in 40 CFR 125.3(d)(2).").
5

The Agency has not performed a separate best professional judgment analysis to
determine what technology-based effluent limitation should apply to Illinois-American Water's
facility. The Agency instead argues that the appropriate effluent limitation is the standard set
forth in the Board'sregulation
of general applicability.
See
Tr. at 48:12-18 (testimony of Toby
Frevert) ("[T]he Agency has historically relied upon effluent limitations contained in the Board's
pollution control regulations to meet its NPDES permitting responsibilities.',).3 This regulation
of generally applicability
promulgated more than 35 years ago - is neither facility-specific
nor industry-specific.
See id.
at 63:11-16 (testimony of Mr. Toby Frevert) (acknowledging that
the standard reflects "technology to be applied across the board to all point sources") (emphasis
added);
id.
at 70:15-18 (testimony of Mr. Toby Frevert) (acknowledging that the "BPl" standard
applied by the Agency was set in 1972).
The Agency'sreliance
on the regulation of general applicability certainly does not
consider "any unique factors relating to the applicant" - factors which must be considered
pursuant to 40 C.F.R 123.3(c)(2)(ii). Illinois-American Water has
an adjusted standard that
requires Illinois-American Water to offset any solids in its effluent
by a ratio of no less than 2 to
1. The Agency clearly considered this offset a unique factor in the past.
See
Hearing Transcript,
In the Matter of: Proposed Adjusted Standard Applicable to Illinois-American Water Company's
Alton Public Water Supply Replacement Facility Discharge to the Mississippi River, AS 99-6
3 The Agency clearly stated this position numerous times throughout the hearing.
See also id.
at 64:1-64:6
(testimony ofMr. Toby Frevert)
("In
those cases where there are no federal categorical standard, we have...
historically and routinely adhered to those Board effluent standards as our judgment on what best available and
practical technology is.");
id.
at 70:4-11 ("Again, to keep with the historical and consistent practice of our agency in
those areas where we have
an obligation to exercise
BPI
judgment in carrying out point source permitting activities,
we have recognized Board-promulgated general effluent standards as the appropriate reasonable technology to apply
to those sources, and we'renot treating this source differently.").
See also id.
at 14:22-15:1 (statement of Mr.
Sanjay Sofat) ("Where the federally promulgated effluent limitations are not available, the Agency has always
considered the
Board'sPart 304 standards as equivalent to the EPA's best professionaljudgment.");
id.
at 74:2-74:3
("[W]e consider the Board'sPart 304 as the
BPI.
That is our response.").
6

(Nov. 30, 1999) at 9:7-9: 15 (statement of Lisa Moreno, counsel for the Agency) ("Initially,
when we filed our response to the Water Company'spetition, we did not support their request to
be able to discharge without treatment, and we believe that the technology exists for them to
treat. However, having said that, since the meeting that
we had and the proposal that was made,
we are enthusiastically looking at this opportunity to try something, to be honest with you, that is
new for us too.").
In
addition to the PCWP, there are other "unique factors" presented by
Illinois-American Water'sAlton facility, and the regulation of general applicability also fails to
take these into account. For example, the facility is located
on the Mississippi River (a large and
sediment-laden river), and the solids in the facility's effluent are comprised almost entirely
ofthe
sediment present in the raw water.
The statute which authorizes the Board to grant
an adjusted standard, 35 IlL Adm. Code
104.406, also requires the Agency to consider the "unique factor" that is the PCWP. That statute
contains the basic requirement that the petition for an adjusted standard must contain a statement
which explains how the petitioner seeks to justify the proposed adjusted standard, and one
ofthe
elements
ofthis justification requires Illinois-American Water to establish that factors relating to
Illinois-American Water are substantially and significantly different from the factors relied on
by
the Board in adopting the general regulation applicable to that petitioner.
See
415 IlL Compo
Stat. 28.1(c)(I). Significantly, this Board has already determined that Illinois-American Water's
offset involving the Piasa Creek Watershed Project is a substantially and significantly different
factor than those considered by the Board
in establishing the regulations of general applicability.
See
Opinion
& Order of the Board, AS 99-6 at 18 (Sept. 7,2000) ("The Board fmds that the
GRLT Project is significantly and substantially different from any factor than the Board relied
on
in adopting the regulations at issue herein.").
See also id.
at 19 & 20 (same). The Agency has
7

acknowledged this as well.
See id.
at 9 (observing that in its amended response, the Agency
"said that the GRLT Project, which will offset the residuals
in the untreated discharge from the
new facility by a two to one margin, is a substantially different factor than those that the Board
were concerned with in adopting the three standards at issue herein").
In its briefing in this case, the Agency has not presented any opposition to or
disagreement with the BPJ analysis conducted in 1999 and incorporated by reference into this
proceeding.
However, the Agency now asks this Board to ignore the facts of this case; to
abandon the conclusions reached by Illinois-American Water, ENSR, the Agency, and the
Board
in
1999-2000; and to rely solely on the regulation of general applicability.
This
position is clearly
at odds with the basic purpose of an adjusted standard - to vary the
application
ofthe regulation of general applicability where the particular circumstances
applicable to a permit applicant deem appropriate. The Board should not determine what
technology-based effluent limitations should apply to the Alton facility solely through reliance
on the Agency'sview of how to apply a regulation of general applicability passed over 35 years
ago. Clearly, the
Agency'sview is subject to change. As in AS 99-6, the "case-by-case"
effluent limitation for the facility should be determined
on a "case-by-case" basis, through a best
professional
judgment analysis specific to this facility that considers the "unique factors"
presented
by this case.
c.
Neither State Regulations Nor State or Federal Policies Prohibit Illinois-
American Water's Use
Of
An
Offset Project
The Agency argues that the "[u]se of [the Piasa Creek Watershed Project and associated
offset], however, as a substitute for best available technology controls is inconsistent with the
basic intent
of the Clean Water Act and the State'slong-standing policy of imposing technology-
8

based effluent limitations on point sources." (Tr. 16:4-16:9.) This argument is not supported by
state regulation, state trading policies, or federal trading policies.
First, Illinois regulations provide the Board with a mechanism to grant permit applicants
an adjusted standard from technology-based effluent limitations.
See
35 Ill. Adm. Code 104.406.
Adopting the Agency'sposition would allow a federal policy - notably, not a federal statute or
regulation
4
-
to preempt this state regulation whenever offset projects are involved. This would
create the possibility for absurd results. The Board would then be unable to grant an exception
under Section 104.406 to the state'stechnology-based effluent limits when
an offset project were
involved. But the Board could still grant an adjusted standard to a facility with inadequate room
to build lagoons, or a facility located in a zoning district that prohibited the cqnstruction
of
lagoons.
In
other words, application of the federal policy to preempt state regulations would tie
this Board'shands when an offset project could create a net environmental benefit, but would
nonetheless allow the Board to grant an adjusted standard with the potential to create greater
harm to the environment than traditional treatment.
In
addition, the Agency'sargument is not supported by state trading policies. As Mr.
Sanjay Sofat stated at the August
28,2007 hearing, "[t]he simple fact is that Illinois does not
have a promulgated trading policy.
If and when Illinois decides to adopt a trading policy, some
ofthe points raised by Illinois-American may become relevant in drafting ofthe policy.
However, this adjusted standard proceeding is surely not a proper forum to discuss the details
of
such a policy." (Tr. 17:5-11.) Illinois-American Water should not be punished because the
Agency has not found the time or inclination to promulgate a trading policy. Here, the only
"policy" explained by the Agency is an informal statement
of a few Agency representatives. The
4 The federal policy does not have the force and effect of law. The policy is just that - a policy - and does not carry
the same weight as a statute
or regulation.
9

Board should not give the Agency'sinfonnal position undue weight. Rather, once the Agency
promulgates an official statement
of its policy, the Board should take its cue from that Agency
policy - but not until that time.
More importantly, as a matter
of law, the absence of a state trading policy does not
prohibit Illinois-American Water'suse
ofan offset, as the Agency suggests. If that were the
case, the Agency would not have approved (and the Board would not have granted) the Alton
facility's existing adjusted standard -
or any other adjusted standard involving an offset project,
for that matter. At the hearing on August 28,2007, Agency witness Toby Frevert stated that the
adjusted standard applicable to Illinois-American Water'sAlton facility is a lone deviation in
Illinois'shistory
of adjusted standards.
See
Tr. 67:7-8 (affInning that the state of Illinois has
never had a nonpoint source project used as an offset trading project, and stating that
"I'mhappy
to say there are no others"). But there are.
In AS 91-9, for instance, the Board granted the City
of East Moline an adjusted standard
from the Board'seffluent regulations for TSS and iron at 35 Ill. Adm. Code 304.124 as applied
to the wastewater discharges from East Moline'swater treatment plant.
See
Opinion and Order
ofthe Board, In the Matter of: Petition ofthe City of East Moline and the Illinois Environmental
Protection Agency for Adiusted Standard from 35 Illinois Administrative Code 304, AS 91-9 at
3 (May 19, 1994). Also, in AS 91-13, the Board granted the City
of Rock Island an adjusted
standard from the
Board'seffluent regulations for TSS and iron at 35 IlL Adm. Code 304.124 as
applied to the wastewater discharges from Rock Island'swater treatment plant.
See
Opinion and
Order
ofthe Board, In the Matter of: Petition ofthe City of Rock Island for An Adjusted
Standard from 35 Illinois Administrative Code 304, AS 91-13 at 3 (Oct. 19, 1995). One
of the
conditions imposed on East Moline as a result
of the adjusted standard was that East Moline
10

obtain land that was presently being farmed and to hold the land as fallow land, with the purpose
of "more than offset[ting] the net amount of solids added to the Mississippi River from the
discharge
of its mixing tank as compared to the amount of solids which result from the raw water
used."S The conditions imposed on Rock Island similarly required Rock Island to offset any
possible increases in sediment discharges to the Mississippi River by removing some erodable
land from cultivation.
6
These Board orders establish that other facilities use offsets as part of an adjusted
standard from Illinois' effluent limitations
at 35 Ill. Adm. Code. 304.124, contrary to Mr.
Frevert'stestimony. These orders also show that those other facilities are subject to more lenient
conditions than Illinois-American Water. East Moline'scondition requires only that it "more
than offset" the amount
of solids it adds to the raw water.
7
Similarly, Rock Island's condition
requires only that it offset in
"an equal amount" the total suspended solids caused by the water
5 The permit condition applicable to East Moline's facility provides that "[u]ntil at least January 1, 1996, East
Moline shall maintain as fallow land approximately 33.7 acres which are part of Farm #2116, Tax Parcel 350 and
351 in Coe Township and after that date shall either continue to maintain that land as fallow or shall obtain, through
lease or purchase, other agricultural land which at the time of acquisition is not fallow land and which is calculated
through the use of the Universal Soil Loss Equation to contribute a net suspended solids loading to the Mississippi
River (as compared to the calculated loading for fallow land) of least an average of 500 tons per year ofthe term of
the lease or ownership ofthe water plan shall implement some other plan approved by the Agency for offsetting the
water plant'snet contribution of suspended solids to the Mississippi River."
See
Opinion and Order ofthe Board,
AS 91-9 at 9 (May 19, 1994).
6 The permit conditions applicable to Rock Island's facility provide that: "Within nine (9) months from the start of
operations of all three circular clarifiers, Rock Island shall then obtain, through lease or purchase, agricultural land
which at the time of acquisition is not fallow land and which amount is calculated through use ofthe Universal Soil
Loss Equation to contribute an equal amount oftotal net suspended solids loading to the Mississippi River as the
total suspended solids caused by the water treatment plant's discharge; Rock Island shall remove the land... from
agricultural service and shall maintain such land as fallow land, unless such land is replaced with other land
similarly removed from agricultural service and maintained as fallow land or the water plant implements some other
plan approved by the Agency for offsetting the water plant'scontribution of suspended solids to the Mississippi
River."
See
Opinion and Order ofthe Board, AS 91-13 at 6 (Oct. 19, 1995).
7 If Illinois-American Water were subject to such a condition, it could comply with its adjusted standard by
achieving a soil savings of only 66 tons.
See
Affidavit ofPaul Keck at
~20
(noting that Illinois-American Water
adds approximately 66 tons of solids to the raw water, in the form of coagulant residue) (attached to the Amended
Petition as Attachment D).
11

treatment plant'sdischarge.
8
Finally, these orders also show that this Board has granted adjusted
standards to such other facilities on an indefInite basis. East Moline'sadjusted standard does not
address when the adjusted standard will terminate, and clearly contemplates that the adjusted
standard will continue for at least 20 years.
See
Opinion and Order ofthe Board, AS 91-9 at 7-8
(May 19, 1994) (stating that "[o]ver a twenty-year period the proposed adjusted standard would
thus save East Moline approximately $20 million," and granting the proposed standard). Rock
Island'sadjusted standard similarly does not address when the adjusted standard will terminate.
See
Opinion and Order of the Board, AS 91-13 (Oct. 19, 1995). Thus, contrary to Mr. Frevert's
testimony, Illinois-American Water is not the only facility in Illinois that uses nonpoint source
reductions to comply with an adjusted standard from the state'sgenerally applicable effluent
limitations. Granting the relief requested by Illinois-American Water would be neither
unprecedented nor inconsistent with state policy.
Finally, federal trading policies do not prohibit Illinois-American Water'suse
of an offset
project in these circumstances. USEPA's2003 Water Quality Trading Policy states specifIcally
that "EPA does not support trading to comply with existing technology-based effluent limitations
except as expressly authorized by federal regulations."
See
USEPA, OffIce of Water, Water
Quality Trading Policy (Jan. 13, 2003). This federal trading policy applies only to facilities that
are subject to "existing technology-based effluent limitations" and, as even
Mr. Frevert was
willing to admit, Illinois-American Water is not currently subject to any such standards.
9
See
Tr.
8 Assuming that Rock Island'spennit condition requires an offset ofthe total amount of solids in the facility's
effluent (rather than the amount
of solids added by the facility to the raw water), Illinois-American Water could
comply with its adjusted standard by achieving a soil savings
of only 1,600 tons if it were subject to such a
condition.
See
Affidavit ofPaul Keck at
~21
(noting that the total tons of solids discharged from the Alton facility
each year is approximately 1,600 tons) (attached to the Amended Petition as Attachment D).
9
There are no federal effluent limits applicable to the Alton Plant either. Tr.51:3-4. ("There are no federal effluent
guidelines for total suspended solids and iron discharges.")
12

90:5-10
("In
terms of attainability and reasonable accuracy, I believe [both the TSS limit and the
iron limit adopted by the Pollution Control Board in 1972] constitute readily available best
practical judgment technology, but I do understand your point that at points in the past the Board
has consciously relieved [Illinois-American Water]
ofthat technology in lieu of other
conditions.");
id.
at 90:14-15 (confIrming that "there is not a technology-based effluent
limitation applicable to the Alton plant
of Illinois-American Water Company" in Pollution
Control Board regulations).
Furthermore, the fact that
tltefederal trading policy Itas
not cltanged
cannot be
emphasized enough. The 1996 policy that was
in effect at the time AS 99-6 was granted states
the same principles as the [mal policy issues in 2003. Notably, the Agency has not provided one
example in support
ofthe changes it claims were made, either in its recommendation or at the
hearing. This suggests that the Agency has simply changed its mind, and is citing the federal
policy as a smokescreen in lieu
of actual support for its position.
D.
The Board Should Not Accept The Agency's Unsupported Interpretation Of
USEPA Policy
The backbone ofthe Agency'schange from supporting AS 99-6 to opposing an extension
ofthat standard is its newfound beliefthat the use of an offset project runs counter to state law
and USEPA policy.
See
Tr. 16:4-9 (statement
of Mr. Sanjay Sofat) ("Use of this project,
however, as a substitute for best available technology controls is inconsistent with the basic
intent
ofthe Clean Water Act and the State'slong-standing policy of imposing technology-based
effluent limitations
on point sources."). The Agency appears to base this position in part on
discussions between Mr. Toby Frevert and USEPA representatives. However, Illinois-American
Water has received written statements from a USEPA representative that conflicts with the
position reported
by Mr. Frevert.
13

Mr. Frevert testified that he contacted Mr. Peter Swenson and Mr. George Azevedo, both
employees of USEPA's Region 5 office. (Tr. at 52:1-3.) Mr. Frevert reported that Mr. Swenson
said "his understanding
of what Illinois-American was requesting was inconsistent with his
understanding
ofwhat federal policy and good practice requires." (Tr. 52:7-11.) Mr. Frevert
further stated that
Mr. Azevedo was "surprised" and "disappointed" that this was the nature of
the program, and that Mr. Azevedo said that "this was a prime example of misuse of a trading
concept, a good example
of what trading should not be." (Tr.53:2-5.)
Unfortunately, no one participated in the Frevert-Azevedo telephone discussion but the
two
ofthem (Tr. 59:18-60:2), and the Agency elected not to invite Mr. Azevedo to testify at the
August 28 hearing. But
we have the benefit of two e-mail exchanges between Mr. Azevedo and
Cindy Hebenstreit, Director
of Environmental Management for American Water Company's
Central Region. Those two messages contradict the statements attributed to Mr. Azevedo by Mr.
Frevert. In those written exchanges, Mr. Azevedo stated "we want this program to be
successful," and "I believe that the situation [i.e. Illinois EPA's opposition] is salvageable and 1
will work with the State to that end.,,10
The cause for this discrepancy is unclear. Unfortunately,
Mr. Frevert did not invite
anyone else from the Agency
or Illinois-American Water to participate in his call. (Tr.59:17-
60:2.) Mr. Frevert testified that he did not share a copy of Illinois-American Water'spetition for
10
See
e-mail correspondence from George Azevedo, U.S. EPA Region 5, NPDES Nutrients and Water Quality
Trading Coordinator, to Cindy Hebenstreit, Director, Environmental Management, American Water -Central Region
re: water quality trading materials (Feb. 27, 2007); e-mail correspondence from George Azevedo, U.S. EPA Region
5, NPDES Nutrients and Water Quality Trading Coordinator, to Cindy Hebenstreit, Director, Environmental
Management, American Water -Central Region re: Illinois American Water Piasa Creek project (May 30, 2007).
(This correspondence, as well as an intervening e-mail from Cindy Hebenstreit to George Azevedo, are attached
hereto as Exhibit 1. Also, an Affidavit of Cindy Hebenstreit attesting to the authenticity ofthis e-mail
correspondence is attached hereto as Attachment B.)
14

the adjusted standard with Mr. Azevedo (Tr. 56:24-57:3), nor did he share a copy of Illinois-
American Water'samended petition (Tr. 57:4-6), the ENSR study (Tr. 57:14-18), or the latest
report from Great Rivers Land Trust on the Piasa Creek Watershed Project (Tr. 57:19-24).
Moreover,
Mr. Frevert testified that he did not inform Mr. Azevedo that the Piasa Creek
watershed project had reached a soil savings level
ofapproximately 6,700 tons (Tr. 58:13-17),
and did not inform
Mr. Azevedo of the net savings that had been achieved when factoring in the
loading from the plant to the savings achieved in the
Piasa Creek watershed (Tr. 58:18-22). As
Mr. Frevert himselfobserved, "I was not attempting to understand the federal perspective on the
Piasa Creek Watershed Project." (Tr. 60:23-61:6.)
As noted above, the facts
of this case cannot be ignored. Mr. Frevert'spresentation of
the issue to Mr. Azevedo in the abstract may have colored Mr. Azevedo'sanswers to Mr.
Frevert'spointed questions.
In
addition, Mr. Frevert'sconversation with Mr. Azevedo took
place before Ms. Hebenstreit'scorrespondence with
Mr. Azevedo in late May of2007. Mr.
Frevert explained that his conversation with Mr. Azevedo took place in April or May of2007.
(Tr.58:1-12.) Because no one else participated in these calls and neither Mr. Azevedo nor
USEPA has entered a statement on the record regarding USEPA'sperspective on the application
of federal policy in this case, Mr. Frevert's summary of USEPA'sperspective should not be
given any weight.
This is particularly true in light
of the conference on June 15,2007, between Ms. Cindy
Hebenstreit and Ms. Marsha Willhite (Director
of the Division of Water Pollution Control at the
Agency),
Mr. Jim Hanlon (Director, Office of Wastewater Management in Washington, D.C.),
Mr. Marcus Zobrist (Team Leader ofthe Water Permitting Program, in Washington, D.C.), Ms.
Nina Badgerfield (Washington, D.C.), and
Mr. Peter Swenson (Branch Chief, Permits Section,
15

Region V). During this conference, no one from USEPA advised or implied that the adjusted
standard should not be extended, and Ms. Hebenstreit came away from the call strongly
encouraged that USEPA officials had a favorable view
of TSS offset trading generally - and the
GRLT/Illinois-American Water offset trading in particular.
See
Ex. lat 2:9-2:19 (confIrming
that Illinois-American Water'sanswers to the Board'squestion
#4
posed to the Agency are true
to the best
of her knowledge, information, and belief); Petitioner Illinois-American Water
Company'sWritten Answers To The Board'sQuestions For IAWC And IEPA Pertaining To
The Amended Petition AS 2007-2 at 28-30 (Aug. 21, 2007).
As with all permits issued by the Agency, USEPA will have the opportunity
to object ifit
believes that the terms of the permit will run counter to federal law. Rather than simply adopting
the Agency'sperspective regarding whether the permit is consistent with USEPA policy and
federal law, the Board should give USEPA the opportunity to weigh in on this issue itself,
if
USEPA deems that to be necessary.
11
As noted above, neither federal law nor USEPA trading
policy have changed since AS 1999-6 was granted, so Illinois-American Water believes it is
highly unlikely that USEPA will object.
E.
Requiring Treatment Would Be Detrimental to the Environment
The Agency also claims that extending the adjusted standard would be inconsistent with
the Clean Water Act. (Tr. at 13:9-13.) However, the stated purpose
ofthe Clean Water Act is
"to restore and maintain the chemical, physical, and biological integrity
ofthe Nation'swaters."
See
33 U.S.C. 1251(a). This belies Mr. Frevert'sassertion that "I don'tthink net benefIt,
whether it be positive or negative, is the point here." (Tr. at 78:5-6.) Although net benefIt may
II
Illinois-American Water firmly believes that USEPA's silence on the record with respect to this specific adjusted
standard to date shows that the USEPA policy is consistent with the proposed standard, as USEPA is clearly aware
of Illinois-American Water'sAmended Petition and its request for an indefinite extension of its adjusted standard.
16

be irrelevant when federal categorical effluent standards apply, it is clear that no such standards
apply to the Alton facility. The benefit to the environment - the stated purpose
ofthe Act and
its implementing regulations - therefore cannot be ignored here.
The Agency'sown supervisor
of the Water Quality Standards Unit with the Division of
Water Pollution Control, Robert G. Mosher, has acknowledged the net environmental benefit
that Illinois-American Water'soffset project has achieved.
In
his deposition on August 16,
2007, Mr. Mosher stated, "[p]ersonally, I don'twant to see it ended necessarily. It'sprobably
good for the Piasa watershed."
See
Deposition Transcript (Aug. 16,2007) at 52:17-19. He also
stated that given his frame
ofreference, "it seems to me that the offset was a benefit to the
environment,
[a] net benefit."
See id.
at 55:10-12.
For some unknown reason, the Agency refuses to acknowledge the certain effect of
terminating the adjusted standard and requiring Illinois-American Water'sAlton facility to
install lagoons and conventional treatment equipment - a net increase in the solids loading to
the Mississippi River. Rather, Mr. Frevert avoided the question, asking "[a]re you asking me to
speculate that the Piasa Creek project would die and there is no community support for that
project or federal or state funds available to support that?" (Tr. at 83:6-9.) Mr. Frevert's
question misses the point. The fact is,
if Illinois-American Water must install lagoons and
conventional solids handling facilities, it will no longer fund the PCWP and, over time, the soil
savings that exist today will decline., Eventually, a greater volume
of solids will be added to the
Mississippi River using conventional treatment than under the offset trading project.
12
12
In
fact, the result would be a harsh drop from 5,091 net tons saved to 205 net tons discharged (calculated using the
formula set forth in the Affidavit of Paul Keck, attached to the Amended Petition as Attachment D) - a swing of
approximately 5,296 more tons of TSS to the Mississippi River than the amount current achieved through Illinois-
American Water's compliance with the adjusted standard.
17

F.
Another Sunset Period Is Unnecessary
At the hearing, Anand Rao asked Terry Gloriod to comment on whether the Board should
impose another sunset provision in the adjusted standard ifthe Board decides to grant Illinois-
American Water'srequested relief. (Tr.37:24-38:3.) Mr. Gloriod responded that there is no
need for an additional sunset, because "the NPDES pennit runs on a five-year cycle, and so
every five years we're going to come up for renewal of our NPDES permit, and clearly, ifthe
pennit condition is compliance with the adjusted standard and maintaining [a] two to one offset
or at least 6600 tons, that'sgoing to get reviewed every five years." (Tr. 38:5-11.) Illinois-
American Water'sAmended Petition further explains why a sunset provision is unnecessary,
13
but these reasons are restated here for the Board'sconvenience.
First, the factors the Board has identified in other adjusted standard proceedings that
justify use of a sunset provision to allow the Board to revisit a case are not present in this case.
Those factors include circumstances in which a sunset provision would encourage the petitioner
to take advantage ofnew technology and to continually explore methods to lower its effluent
limits
14
;
in which the water quality of the receiving stream was expected to change in the near
future, when granting pennanent relief would remove any incentive for the petitioner to improve
its effluent quality, and when the petitioner'sevaluation
of alternatives was not detailed enough
to conclusively rule out all alternatives
15
; and in which granting pennanent reliefwould utilize a
portion ofthe receiving water that would not then be available to future dischargers.
16
Here,
13
See
Amended Petition at
~~15-17.
14
See
In
the Matter of: Petition ofPDV Midwest Refining, L.L.C. for a Site-Specific Rulemaking Amendment to 35
111. Adm. Code 304.2 13, R98-14 at 3 (Dec. 17, 1998).
15 See
In
the Matter of: Proposal ofUnion Oil Company of California to Amend the Water Pollution Regulations,
R84-13 at
12 (March 19, 1987).
16
See
In
the Matter of: Site-Specific Rulemaking for the Sanitary District of Decatur, Illinois, R85-15 at 7 (Jan. 23,
1986).
18

exploration of new technologies or alternative methods to reduce the amount ofTSS and iron in
Illinois-American Water's effluent is not necessary because the offset actually improves the
environmental quality
of the River; the conditions in the Piasa Creek Watershed and the
Mississippi River are not likely to change
in the near future; Illinois-American Water's Site-
Specific Impact Study was comprehensive enough to rule out other alternatives; and the Piasa
Creek Watershed Project actually
creates
capacity in the receiving waters for future dischargers
by reducing the amount ofTSS and iron in Piasa Creek and in the Mississippi River.
Second, permanent relief is also appropriate because Illinois-American Water has
successfully enhanced water quality
in the Mississippi River above even the most ambitious
expectations, and this Board has granted permanent reliefto petitioners on lesser groundS.
17
As
noted above, the East Moline and Rock Island facilities are subject to less restrictive offset
requirements, yet the adjusted standards applicable to those proceedings do not include
termination
or sunset provisions.
Finally, requiring submission to the Board
of annual reports reflecting the soil savings
ofthe Project and conditioning the adjusted standard on satisfaction of certain conditions, rather than
including a sunset provision, would allow this adjusted standard to remain in place until the Board
determines that the adjusted standard is no longer successfully reducing the TSS loading to the
Mississippi River. Illinois-American Water'sproposed order,
if granted, will require Illinois-
American Water to maintain a 2 to 1 offset
ofthe solids in its effluent (with a soil savings ofno less
than 6,600 tons per year), and to submit annual reports on its soil savings and offset reduction to the
Board and the Agency. This Board has approved the use
of a reporting requirement in other adjusted
standard proceedings, provided that the Board retains some oversight over the petitioner's
17
See, e.g.,
In
the Matter of: Proposal ofMobil Oil Corporation to Amend the Water Pollution Regulations, R84-16
at 8 (Feb. 5, 1987) (holding that a sunset provision was not necessary when the petitioner's discharge was "quite
close" to the regulation of general applicability).
19

compliance with the standard.
18
The annual reports provide the Board with this oversight, and
Illinois-American Water'sneed to renew its NPDES permit every five years ensures that the Agency
will review Illinois-American Water'scompliance with the adjusted standard
no less than every five
years.
G.
Send the Right Message to the Regulated Community, the Public, and to
Other States and Regulatory Agencies
This case has an audience. The PCWP has been a remarkable success, and news ofthat
success has spread well beyond the Alton community. The PCWP has achieved acclaim
on a
state-wide level and on a national level.
See
Affidavit ofAlley Ringhausen at'8 (attached to the
Petition as Attachment A).
An invited speaker at many national forums, Alley Ringhausen has
trumpeted the success
of GRLT's program and helped other environmental groups and point
source dischargers understand that point/non-point source offset trading projects really
do work.
See id.
at '10. He has touted the success that can be achieved through the cooperative efforts of
a private company, a land trust and the governing regulatory body. Without question, the PCWP
is perceived as a model
of success in and outside of Illinois, as it should be. Indeed, USEPA has
acknowledged that it is considering the PCWP as it deliberates
on whether or not to propose
federal standards for water treatment plants.
See
Ex. lat 2:9-2:19 (confirming that Illinois-
American Water'sanswers to the Board'squestion #4 posed to the Agency are true to the best
of
her knowledge, information, and belief); Petitioner Illinois-American Water Company's Written
Answers To The Board'sQuestions For IAWC And IEPA Pertaining To The Amended Petition
18 See, e.g.,
In
the Matter of: Amendments to Water Quality and Effluent Standards Applicable to the Chicago River
System and Calumet River System, R87-27 at 23 (March 24, 1988) (including a reporting requirement);
In
the
Matter of: Site Specific Rule for City ofEffingham
Treatment Plant Fluoride Discharge, 35
Ill.
Adm. Code 304.233, R03-11 at 9 (July 24,2003) (granting permanent
relief, but noting that the Board would revisit the standard ifthe passage oftime reveals that the proposed water
quality standards are not being met).
20

AS 2007-2 at 29 (Aug. 21, 2007) (Mr. Hanlon, stating that EPA is working on categorical
standards but "is looking at your situation there
in Alton").
So, the denial
of an indefInite extension will be noticed by the regulated community, and
by other regulatory agencies as well. Terry Gloriod'stestimony is compelling on this point.
(Ex. 6
at 16:1-22.) Reflecting on the seven year "journey" from the fIrst adjusted standard case
to now, Mr. Gloriod expressed understandable frustration. Illinois-American Water satisfIed
every requirement the Agency imposed, answered every question the Agency raised
in 1999 and
2000, spent time and resources to make the PCWP succeed, achieved success years ahead of
schedule, and then faced unwavering opposition from the Agency at the eleventh hour. For
seven years, the Agency made no negative comments while Illinois-American Water invested
in
soil savings projects that will be effective well beyond 2010. Then the Agency'sonly witness
insisted that the Board end the adjusted standard, essentially calling it a mistake from the start.
(Tr.67:11-13.)
Ifthe Board denies the Amended Petition, it will send a negative message to the regulated
community, to wit: Come to the Board for
an adjusted standard if you are serious about an offset
trading project; do everything asked of you in the Board'sOrder granting your adjusted standard
and meet offset goals years ahead
of schedule; make sure to implement soil savings projects that
will continue to eliminate TSS loading years into the future
... achieve all that and the Board will
terminate your adjusted standard. Illinois-American Water doubts that the Board intends to send
such a message,
but that will be the unfortunate result ifthe Agency's "new direction" is
adopted.
Illinois-American Water urges the Board to send a different message - one
of
encouragement for point sources that might be considering offset trading for TSS: Improved
21

water quality really does matter in Illinois. If a petitioner presents a SSIS that concludes, without
. contradiction from the Agency, that untreated discharge is BPJ for a particular water body, and
. that same petitioner promises to eliminate two pounds
of solids for every pound it loads, it
should - and will - be taken seriously by the Board. The Board will follow the regulation
governing adjusted standards, determine whether that offset project is "significantly and
substantially different," and stand by that decision years later when the offset project is a proven
success.
That message will be consistent with Illinois law, and will maintain the credibility the
Board has earned for decades. In addition, it will allow one
of America'smost successful and
acclaimed offset projects to stay the course and improve water quality on the Mississippi River.
CONCLUSION
Illinois-American Water dutifully honored every requirement established by the Board in
case AS 99-6. The fruits
ofthat labor have been one of the most successful and acclaimed TSS
offset trading projects in America. Although the Agency failed to perform a five-year study
of
the effectiveness ofthe PCWP, that effectiveness is undisputed. The ten year goal was achieved
in year six. Success
of this magnitude warrants an extension. The Board should stay the course,
extend the adjusted standard, continue the mechanism that improves water quality in the
Mississippi River near Alton and Godfrey, and continue to send the message to the regulated
community, the public, and other states that successful offset projects will be encouraged, not
terminated, in Illinois.
22
Electronic Filing, Received, Clerk's Office, September 10, 2007

Respectfully submitted,
By:
Bradley
S. H es, #0 128879
Blackwell
S ders LLP
720 Olive St., 24th Floor
St. Louis, MO 63101
Telephone: (314) 345-6000
Facsimile: (314) 345-6060
An
Attorney for Petitioner
23
Electronic Filing, Received, Clerk's Office, September 10, 2007

BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
IN THE MATTER OF:
PROPOSED EXTENSION OF ADJUSTED STANDARD
APPLICABLE TO ILLINOIS-AMERICAN
WATER COMPANY'SALTON PUBLIC WATER
SUPPLY FACILITY DISCHARGE
TO THE MISSISSIPPI RIVER
)
)
) AS 2007-2
) (Adjusted Standard)
)
)
)
CERTIFICATE OF SERVICE
I hereby certify that on September 10,2007, the attached PETITIONER ILLINOIS-
AMERICAN WATER COMPANY'SPOST-HEARING BRIEF IN SUPPORT OF ITS
AMENDED PETITION FOR EXTENSION OF ADJUSTED STANDARD was filed by
electronic transmission with the Office
ofthe Clerk ofthe Illinois Pollution Control Board, and
was served by first class mail, postage prepaid, upon the following persons:
John Therriault, Assistant Clerk
Illinois Pollution Control Board
James R. Thompson Center
100 West Randolph Street, Suite 11-500
Chicago, Illinois 60601
William Richardson, ChiefLegal Counsel
Illinois Department
ofNatural Resources
One Natural Resource Way
Springfield, Illinois 62702
Matthew
J. Dunn
Division Chief, Environmental Enforcement
Illinois Attorney General
100 West Randolph Street,
12
th
Floor
Chicago, Illinois 60601
Sanjay Sofat
Division
ofLegal Counsel
Illinois Environmental Protection Agency
1021 North Grand Avenue East
P.O. Box 19276
Springfield, Illinois 62794-9276
Carol Webb
Hearing Officer
Illinois Pollution Control Board
1021 North Grand Avenue East
P.O. Box 19274
Springfield, Illinois 62794-9274
Respectfully submitted,
By:
Bradley
S. H" es, #03128879
Blackwell S ders LLP
720 Olive St., 24th Floor
St. Louis, MO 63101
Telephone: (314) 345-6000
Facsimile: (314) 345-6060
An
Attorney for Petitioner

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Illinois
American Water®

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Piasa Creek Watershed Project
A Successful Partnership
Between Industry, Environmentalists
PROJECT SUMMARY
In Alton, the Piasa Creek Watershed Project is an example of a unique, successful
relationship between environmentalists (Great Rivers Land Trust) and industry (Illinois
American Water).
In 1999, Illinois American Water began construction of a new water treatment facility on
the Great River Road in Alton. The new plant replaced a 108-year-old plant that was
flooded
in August 1993. The original Alton facility had a permit that allowed discharge
without suspended solids limits, permitting the Company to return river mud and silt
filtered
in the treatment process back to the river. This direct discharge practice had
been allowed in the Alton District for more than 100 years.
The discharge permit was part of
an adjusted standard alloWing such discharge under
state environmental regulations.
As the Company explored extending the adjusted
standard to the new plant, the state regulatory agency, Illinois Environmental Protection
Agency (IEPA), indicated opposition and proposed adding solids limits to the permit for
the new facility. Solids limits, if imposed, would require construction of impoundment
lagoons and trucking tons of river silt along the Great River Road, a national scenic
highway, to a landfill several miles from the new Alton treatment facility.
Several concerns were raised by interested stakeholders. Construction of lagoons and
operating dewatering equipment (belt presses) would have substantially increased
construction and operating costs at the water treatment facility, and such costs would
be
passed on to local residents, as the Company's ratepayers. In addition, City of Alton
officials, local residents and civic leaders strongly opposed construction of lagoons at the
new treatment facility site. Among other things, there was public concern that lagoons
would significantly increase truck traffic (hauling)
on the Great River Road and that the
disposal of river silts would utilize valuable space at nearby landfills.
As
an alternative, the stakeholders developed an innovative trading concept that would
allow the new treatment facility to return river mud and silt to the river
in exchange for the
Company's participation
in a sediment reduction project in the Piasa Creek watershed.
1

Specifically, Illinois American Water and Great Rivers Land Trust (GRLT) proposed a
partnership
in which Illinois American Water would fund the Piasa Creek Watershed
Project over 10 years
in an attempt to reduce net sediment loading in the river by a 2: 1
ratio, offsetting the amount discharged into the river by the water treatment process. The
plan was to reduce sedimentation through silt basins, dry dams, streambank
stabilization, land acquisition,
and various other practices that could ultimately be
maintained at a level of 6600 tons of soil savings per year.
The IEPA supported the offset project
and, in October 2000, the Illinois Pollution Control
Board (Board) issued the adjusted standard allowing the new plant to start operations.
Under the adjusted standard and related permit, Illinois American Water continues the
practice of direct discharge of residuals from the new Alton treatment facility. The
sediment control from the Piasa Creek projects more than offset the sediment that the
water treatment process returns to the river.
In fact, the unique program has been highly
successful. The
2:1 offset ratio has been achieved four years ahead of schedUle. The
project has
won many state and national awards. It has had a positive impact in the
Alton community, serving
as a strong example of community values being achieved
when industry and environmentalists work together for common goals.
Nevertheless, direct discharge by the facility and maintenance of the soil savings
program may
be discontinued. At the outset, no one knew whether the 2:1 offset could
be attained, so the Board inserted two safeguards into the adjusted standard: 1) a five
year IEPA review at the half-way point of the project to determine if the project was
on
target to meet the ten year goal (which it was); and 2) a seven year sunset provision to
allow the Board to consider the effectiveness of the project before continuing
it. Under
the second safeguard, the adjusted standard is scheduled to expire
in October 2007,
and Illinois American Water
is required to seek an extension.
In October 2006, Illinois American Water filed a Petition for Extension of the Adjusted
Standard that would allow it to continue the practice of direct discharge from the new
Alton treatment facility into the river
in exchange for funding maintenance of soil savings
from the Piasa Creek Watershed Project at
an agreed upon level. Despite the success
of the project, IEPA
has expressed opposition to the Petition and to any permit that
allows direct discharge. Without the adjusted standard and related permit, Illinois
American Water
will be forced to construct lagoons at its treatment facility in Alton, over
the objections of the local public and elected officials. Denying the adjusted standard
also jeopardizes the future maintenance of the Piasa Creek Watershed Project.
--end--
2

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Illinois
American Water®

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Fact Sheet
Alton District Treatment Plant
Adjusted Standard Allowing Direct Discharge of Residuals
./
"Direct discharge" of residuals always has been utilized at the Alton
water treatment plants.
In the Alton District, Illinois American Water has always discharged its residuals from the
water treatment processes directly to the Mississippi River. This practice has been
allowed for more than 100 years.
~
Direct discharge has not posed environmental concerns.
The direct discharge allowance means the company can return sediments (dirt, sand)
that are removed
in the water treatment process back to the Mississippi River.
Approximately
91 percent of what is returned to the river is sediment (dirt, sand). Nine
percent
is biodegradable and inert chemical solids used in the treatment process.
Studies show these chemicals do not adversely affect the river environment. Basically,
the water company returns nothing more to the river than what was removed from
it.
./
If the adjusted standard is denied, the alternative is lagoons at the Alton
water treatment site.
Adding lagoons will require substantial acreage at the site of the existing water treatment
facility to
be developed for storage of river sediment. The stored solids would be treated
on-site with filter presses, and then the solids would
be hauled by truck to a landfill. At a
July 1998 "stakeholders" meeting at the Stratford Hotel
in Alton, with IEPA officials in
attendance, several local homeowners voiced their concern about the potential of
lagoons being constructed at the plant. They
do not want lagoons "in their backyards."
These residents, and the City of Alton, still oppose constructing lagoons.
./
On-site treatment of residuals is substantially more expensive.
There would be a financial impact on water rates for local customers. Lagoons and the
alternate residual-handling technologies at the treatment plant are substantially more
expensive than the direct discharge and offset program that has been
in place since
2000.
In 1999, the construction of lagoons/filter presses was estimated to cost $7.4
million at the new plant, or $720,000 annualized over
30 years. In addition, it was
estimated that it would cost approXimately $420,000 more annually
to maintain and
operate lagoons/filter presses at the plant site.
3

.../
Increased truck traffic on scenic byway.
Treatment of solids would require the daily hauling of waste solids from the water
treatment plant site to a landfill. Under worst-case conditions, this would mean
17
truckloads per day. At a minimum, hauling was expected to require three truck trips per
day. Hauling solids would mean increased truck traffic along one of the nation's most
scenic highways, near a public park and bike trail.
.../
The "direct discharge" practice meets all current legal standards.
Allowing direct discharge of residuals into the Mississippi River in Alton was studied by
an independent expert, which recommended direct discharge as the best method for
handling residuals at the Alton facility under the relevant standards set by federal and
state laws.
.../
Illinois American Water's partnership with Great Rivers Land Trust is a
creative alternate solution that has benefited all of the stakeholders and
the environment.
Eight years ago, Illinois American Water worked with the Great Rivers Land Trust
(GRLT)
and the Illinois EPA to create an alternative to lagoons that would benefit all
stakeholders
and the environment and could be proposed to the Illinois Pollution Control
Board. The parties came
up with an innovative solution -- allow the new treatment
facility to return river
mud and silt to the river in exchange for participation in a sediment
reduction project
in the Piasa Creek watershed. The Illinois Pollution Control Board
approved the proposal and issued
an adjusted standard allowing direct discharge.
As a result, Illinois American Water continued its practice of direct discharge when the
new Alton treatment facility went on-line. Illinois American Water also has provided
funding to the GRLT for the Piasa Creek Watershed Project, a project designed
to
significantly improve the sediment loading which occurs from the Piasa Creek, located
"up-river" from the new water treatment facility. The sediment control from this project
more than offsets the sediment which the water treatment plant would return to the river.
This
is being accomplished at less cost, and without the negative impact of using
lagoons (at the plant site)
and trucking the sediment to landfills daily.
The Piasa Creek Watershed Project has been highly successful. The goal was to reduce
net sediment loading to the river by at least 2:1. The
2:1 offset was achieved four years
ahead of schedule. Further reductions
are practically guaranteed through 2010. Soil
savings are self-sustaining for
an extended duration.
Land acquisitions and
conservation easements will last indefinitely.
In addition, over the past eight years, the Piasa Creek Watershed Project has earned the
following recognition and awards:
• 2002 Illinois Governor's Pollution Prevention Award
• Trees Forever National Award
• National Resource Conservation Service's Conservation Academy Award.
• U.S. Department of Agriculture Earth Team Volunteer Program Award
• Soil and Water Conservation Society's National Merit Award
4

../
Eight Years Later, The Program is in Jeopardy
No one knew in 1999 whether the 2: 1 offset could be attained, so two safeguards were
inserted into the adjusted standard:
1. A 5-year Illinois EPA review at the halfway point of the project to determine if the
project was
on target to meet the ten-year goal.
2. A 7-year sunset provision to allow the Board to consider the effectiveness of the
project before continuing
it.
The sunset provision is scheduled to expire in October 2007. Because of the sunset
provision, Illinois American Water must seek
an extension of the adjusted standard from
the Illinois Pollution Control Board. The Petition for Extension was filed October 31,
2006. Illinois EPA stated initial opposition, and Illinois American Water tried to address
some of the agency's concerns, and filed
an Amended Petition on April 2, 2007. Illinois
EPA has until May 17, 2007 to file a response.
../
The original objective was environmental - sediment loading reduction
-
and the environmental benefits, along with cost savings, continue to
make the project a win-win for all stakeholders.
-- end-
5

Azevedo.·~rge@ep~~i1;e
~,gi:)v'
"
. ....
.
Q5J30/2Il0710:38.AM
'To
CindY.H.ebel1~ti:eit@~mW~ter;c,:pni·
ci::
bee
Slibject Re:lliinois:American'Water PiasaCre.el<proJect
}li.Gi,riqy,;
'tha,iih; You,:5qil;" 'yoti:i:: ;m$$s1:\.g,Ei.,.
I understand that' your
NPDES
J?ermit is
up
'£¢>r t¢ri:e'\\'c:iici.Oci:
tha.t.:
'Y(5~
"i:lt,e
c'oncerned about the'
:prqces.s.
,,~owever,
I
:encourag.e you.tocontii;nue; wor:kfngwith the Illinois ililnv±:tbrimertta,l
p;¢pt~~,1::fQn
1\.MilGY .:i,:pt:.n.i$;
'IIii:ttte:it",
as
tl:1ey .a.r.e,
the designated permitting
a.1.lthCiJ:;.itY~
,Th~li!P'pE$p¢r:m;it
,a.nei
V:,:irJ.anc~
fromwat:E;lr.q'\iFi.JJ;i::¥'.
's.t,?il.ciai:'q:s '.
you are seeking for :tihis. fa'ciiityare issuecth
y
the Statieor illinois.
r:be'lievethcit thes±tU:ctt:iOt:l ±g;Salvageapleai14 '):.
w:tJ,l,\,,,:ork:
'1i't:lj the
state'£:0 that
'end.,
~~st ~egC1:ttiS.,
GEi(jJ:'.ge "
(EiribeCldedimagemoved. t.o fi,le,: picl1643.gif)
Gi;Dd,y,.:He)::ien
$,!:f,i3i
t@ClirlW:i;l,te'r..'<::911\
0512~I20Q701;$9
PM
To.
Subjeot
I11J:1i6,1;5
J\Ii1.$i'~¢~h,
Nap'e)::' I?ias.a,.
CreekpJ:Qject,
.!i;:i,:G~()rg',e,
,
, '
,,' .
.,
.. '.
We: 'had spoken a couple months ago regarding thePiasCl C.t'e:ek Watershed
l?:po,JeGt~':"a~ater
g:uaTit,ytr4t1i.1ig proj ecttli:.at Il1:Lnoi,q
1\rri~rican
Water
'has'
been involved in sJ.nc.e2bd.b..The program has been.very-successful,
4¢l1ievihg
morethcii!,
a
2:1
,reduction in
sed::Lmemt.loading,
Illinois
EPA
Pi3,;S
,
.
sta.ted opposition
t,o
the IIHnois Pollution :Control Bo:ard renewal oftihe
adjiJ.sted stancia..t'.d tha.t ',dlo:\1i!; discharge of
tll.ere~,;iduaistothe
,S
j
EXHIBIT
Ie

r1i~~si$si..pp:i.
Rlvex. The explanation given is that ,a ('ph-:CLo.sophical cnangei'na:s
oqqurred
in hqw the
~geii¢:Y
views thisiss1.le. , I'f IliihQ:LSi-'ArltericaIi is ,Iid,t granted,
the renewal, then the companywiii ha:Ve,to
g~
,. ahead and bu±lda
r\3s
i:Qu
a
l,s "., ",
' . ,
prqq~s~ing
f:Cl:cj,,lJ;ty apyway;a:p,q.
P1"l.~
,,itii.j:;i?:L
.$4 roiHicm imrested in,
the
wa.t'ersnedprotectionprogramwiH be viewed only asa delay t.othe,
eventual
..,
s11.ldgep.a:r:iq.;L,illg:fp.QJ..li
tx~
Erom,previd1.ls ,conversations,
t
understand tt.S. 'ElBA prorootesand p;upp.ox't:s
wate:r:guallby,
':!:'ri'J.,qi,n.g as
ariipnoyi;i:.:j:Y,$,apqpQ$.teffectiv'f:;lapp'rb'q;qh
t.'9
acht¢v¢VvCl.t~r
:qualitYstanda:rds..I't;W·C?1.l~o.b§!b:elpful
if
.the :a.g(;jnc::i'6,S
in
I:ll~npis ~nJ:lwQft1i~.
gf:;lhercd
s'gpP¢J:d:;:f:q';t-:sJ.i9lip.:ttQgr,~lIts.
Ceil). YQii,o't;E$:iJ
a:t!vipe a$ tQ ,h:oWt9.
?pproachE~~ .1:'~
;gt:it
·~hei..r
:i:'nput into thisimatt'er'?
I've. abtacheda,summaryof thepr.ojec::C,anciiss'Ues< below. l'lease,cali me
to
.'
cli$cus$ ifY9\J.wbtCL<i
1ikeae:td.iii:A9i1~}
:i-J~~9tJ:liat:J:bh.
YOUr cotisiderat1..bhbf
this matter. is, ver'{l mucba!?preciahed,
(Seeatti:lchec:!, 'fi::l.:e:1\:ltbn Direq1:
Qi,schaii',g!i::
l).,pj:'il 2007
S.U1l)J1tar.y Fa¢t.
Sheet',DOQ)
Qih¢lY.:flepen:s:t~$;Lt
Director, Env.ironmen'ta'l Management
Auierican Wi3.fer--'Gentra:l Region
727G.r~;Lg,~c>ad
,..... ,
st. Louis,
MO.133.:I.41
314-9~()-2i39'J.
office
314-640;.,77;~7cell(S$f3
a:tt~ch¢ij
tne;
'NttOri
DfI:E:oqt Discha.rge'April 2'007

"",:' '
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
IN THE MATTER OF:
PROPOSED EXTENSION
OF ADJUSTED STANDARD
APPLICABLE TO ILLINOIS-AMERICAN
WATER COMPANY'SALTON PUBLIC WATER
SUPPLY FACILITY DISCHARGE
TO THE MISSISSIPPI RIVER
)
)
) AS 2007-2
) (Adjusted Standard)
)
)
)
AFFIDAVIT OF JEFFREY T. :KAISER
I, Jeffrey T. Kaiser, after being first duly sworn upon my oath, do depose and say as
follows:
1.
I work at Black
&
Veatch Corporation where I hold the position ofProject
Manager for water and wastewater projects. I have been actively engaged in the field
of civil
engineering for more than 20 years, and I am registered by the state oflllinois as a Professional
Engineer. Also, I was certified as an expert at the Board'sAugust 28, 2007 hearing.
, ::
'
2.
I submitted pre-filed testimony in this 'case'on behalf ofIllinois-American Water
Company
("lllii1ois~Arilerican:Water").
The purpose ofmy teStiirlonyYtas t6 compare and'
. contrast the
seCiiillent reductioJieffort ofIllinois-AriJ.ericanWatei-;s Alton plant (tJ.1iough the
Piasa Creek Watershed Project) with the sediment reductionefforts
of six point soUrces
ideilti:ti~d
by the Agency in its Recoinniendation.
'. . . ".
3.
For the majority ofthose six point sources, my testimony addressed whether the
facility in question uses lime softening as part
ofits treatment process. My testimony did not
address this point for the Kincaid area'swater treatment system. At the August 28, 2007
hearing, the Board'sSenior Environmental Scientist,
Mr. Anand Rao, asked me to state whether
the Kincaid system uses lime softening, and
~
was unable to do so without reviewing my notes
and conducting a minimal amount
of additional research.
4.
Following this review
ofmy notes and this additional research, I determined that
the Kincaid system does not use lime softening as part
ofits treatment process.
..
",-
Further, Affiant sayeth not.
ATTACHMENT A

State ofMissouri
)
) ss
County
of St. Louis )
Subscribed and sworn to before
me this
kO
day of September, 2007.
Notary
...
~.7li
Public
'
....
k~
' , ,
My Commission Expires:
[SEAL]
ANTOINETTE M',
WilCOX'"--'
Notary Public - Notary Seal
.
'
State of Missouri '. County of St. Louis
My Commission Expires Aug,
9,
2009
Commission #05402679
\)"" "',."
, ..
",
.."'"

)
)
} AS; 2007-2'
); (Adj;ds.ted Sttindul:d)
)
)
)
,BEF.QRETFlH
I'LL1NOlSPOLLUT10NCQNTROLB@;\R..[)
IN.
TB1~
MATTER
OF:
:PROPOSED. EXTENSIONQF ADJUSTED STANDARD
APPLICABLETOTLLlN018"AMERICAN
WATER COMPANY'sAUrG>NPUB'11C
WATER
SUppLY
.-.,
.., ,
,",
FAcILIty
.. ' ,.".,'
'., ',"
DIS.CHARGE
' ,
, .. ,,'
.
TO tH.p; Ml$SIS$U'}JIRIVER
AFFIDA.VIT UFCINDY BERENS,TOOlT
hdiitdyHdb~,nstt¢if,~fre{b,¢jl)g.:fitst
dulysWQ):'il,11,PIJ(l
jnY:()~lfh,.d()
~¢pqs~al1d'say
f;i$
1Qll()ws;
..
.
T.
I
a1il~I1);ployec.tby
Arnerican Water Works Seniicei@ompany, Inc., a subsldiary.of
l\merican Water Works Company, Inc. fAmerican Water")ILlS Central
:Ih~!?iQnDlrector,
Envit.()11
11
1elltalMahagcment &Conipliahte. The CeritnilReglQii iilCl
udes
the opcriitioilso'f
UfjnpJs~AI)ie.dc~J..Wa,t¢i:·(jQ)llpanY('?Ulhtois-America.I'iW~t~t'~).
2.1\I1J.0eot'g¢
Az~YeqQ, tht:!,NpD.E$:Nutriel1t~i:"!n4W~t¢t',Q1Jq,lity
Tt~.rmng
'G()()i:t:iitiat'9t
f(;ttlsErAE:egj()n$d\l;all~Ql1)ein
Al!gtl~t
.2QQ<k
to:gjscyss,the.PiasaCreelt
W~t~r§Jl~<l
,Fr()] eot C'PCWp1')and walerquality trading. I <Hscussedfhe PCWP ii1detail with.
him
a~
thattiille....
])lJrii~g,
that. can? Mt. Azevedo said heis Veryihiptessedbythc'PC\VP. Alstl,
Jie:~aidthathls
jpb is tq'
~et:{tate's".Qiib6afdwith,
.tinc!'tp
pr().mQt~"
\YE!t¢r9.~ili.ty
tradin&.
.
'3. . .lcalle:d
l\i1r~ A~~v¢do
ih,Fehrucll'y2001l'¢gardilJ.aOvr¢otfGeri1$'l:lbOllttltcllljilQi'$
)3PVlt9J1Ll1¢iJtal
Pr9!~¢ti()nAg~:nl¢Y;S;(tlW
"Agen(jY's")vj.~w(mWhetherwgterqmiHty.
tpldil1g
sho'Uklhcpepl11tted,in fllisGase;During,thi
scall,Mr~
AzevcdoagpjnBta:ted.thathe is extremely
supportiveoflhePCWP. HeiuisOrefeir:redfo lllinois-AmeticimW.atei.,asa '"chan111ion;" ,and
shHqdlhat'USEPA WMtsUl¢ PCWP to'besucoessful.
4.
1rCCP!y¢(J.i,lil {'Huail'n:QPlMi".
Azeve4(~on
t:<ePIV1l1D/,2:7,;tOQ7.
The e-l1tll,il
'att~¢h¢qton1i1]ois-Ain§n'i¢~I1'W~t~1"'~
Pos.t-E1earing Bti,¢fCls.]3'x'hi1.JiilA.is"atfllC Cl,nd aCCllrate:
~C)p;y·,()ffhllt·e;'lllail
..
$.
1 scntane;"111alltpMr. Az.evedo on May29';2007.,.Thec"-mail aHachedto Illinois"-
American Water"s Posl;"HearingBrlefas.JExhibit 1B isa tfueaiiduccuratethpy of
thate~iilaiL
6.
I receivedane.,nial'lniessagefi.omMr.AteVed6.on,.MaY30,2007. Thee....iliUil
attached to
miilois-Ameiiqah'Wat¢t'~
post-Hearing
BtJef~$.
Exhibhl¢lsa
ttuean~Lm::c:utat,¢
GOp)'QI
th
l:lte-m
a
il,
]?il1ther,
Affi@tsay~th
N>f.,
.r
...............
~l"
,....
~
...
Cind~str~if
. .
ATTACHMENT B

StM~
otM'isso\.irl
)
1,$$
'@OUllty orsc Louis )
Silbsctib~~t4tld$Wql'iJ.
tObefQxe me this
/1/v14-
day 9t:$¢pteJ'nber,,200i7.
,~
...
~
•.
'.;~;,
..,..,...,."",.,.,..,.,.,..,." ..,
N·ota~Y·Pi:iBHQ'
""~"""';"'"''''''''''''''''''''''''''''
,$taC\t~,()Js~l1
NC)tc:m1.~~.~li~~Nptc:Jw:~
"
[SEAL,,']
Staf~ofMlssourl
,StChcirl$SCbulJl:V'
,
Commlssldn#OS5,1921P
I\IlYCommls$lon.ExplrE!S:
Mdrch20,~o(jll

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