BAILEY ENTERPRISES,

INC.

ILLINOIS

ENVIRONMENTAL

PROTECTION

AGENCY,

)

)

)

PCB

(LUST

Permit

Appeal)

)

)

)

NOTICE

OF FILING AND

PROOF

OF SERVICE

To:

Clerk

Illinois Pollution

Control Board

State

of Illinois

Center

100W. Randolph,

Ste. 11-500

Chicago, IL

60601

Melanie A.

Jarvis, Assistant

Counsel

Division of Legal Counsel

Environmental

Protection

Agency

1021 North

Grand Avenue

East

P0

Box 19276

Springfield,

IL 62794-9276

PLEASE

TAKE

NOTICE

that I have today electronically

filed

with the Office of the

Clerk of the

Illinois Pollution Control

Board, pursuant

to Board Procedural

Rule

101.302 (d),

a Petition for

Review of

Agency LUST

Decision,

a copy of

which

is herewith

served upon the

Illinois Environmental

Protection

Agency.

The undersigned

hereby certifies

that

a

true

and

correct copy of this

Notice of Filing,

together

with

a

copy of the document described

above, were today

served upon

the Illinois

Environmental

Protection

Agency

by enclosing

same in an envelope

addressed

to Melanie

A. Jarvis, Assistant

Counsel, with

postage fully

prepaid, and by depositing

said envelope in

a U.S. Post Office

Mailbox in

Springfield, Illinois on the

lO day

of February,

2009.

Respectfully

submitted,

BAILEY

ENTERPRISES,

INC.,

BY:

MOHAN,

ALEWELT,

PRILLAMAN

& ADAMI

BY:

Patrick D. Shaw

Fred C.

Prillaman

MOHAN, ALEWELT,

PRILLAMAN

&

ADAMI

1

North

Old Capitol Plaza, Suite

325

Springfield, IL

6270 1-1323

Telephone: 217/528-2517

Facsimile: 217/528-2553

Patrick D. Shaw

Fred C.

Prillaman

BEFORE

THE

ILLINOIS POLLUTION

CONTROL

BOARD

V.

Petitioner,

)

OFFICE

FEB

1

02009

Poiiut

STATE

OF

Control

ILLINOIS

Board

Respondent.

)

---

CLKs

opi

BEFORE THE ILLINOIS

POLLUTION CONTROL BOARD

FEB

10

200g

STATE

OF

I

LLINO,S

BAILEY

ENTERPRISES, INC.,

)

orltrol

Petitioner,

)

v.

)

PCB________

(LUST Permit

Appeal)

ILLINOIS ENVIRONMENTAL

PROTECTION AGENCY,

Respondent.

)

PETITION

FOR REVIEW OF AGENCY LUST

DECISION

NOW COMES Petitioner, Bailey Enterprises, Inc.

(“Bailey”), pursuant to Section 40

of the

Illinois Environmental Protection Act, 415 ILCS

5/40, and Part 105 of the Illinois Pollution

Control

Board Rules,

35

III. Admin. Code Sections 105.400 through

105.412, and hereby appeals that

portion

of the LUST decision issued January 7, 2009, by Respondent

Illinois Environmental Protection

Agency (Agency), in which the Agency failed and refused

to

approve

the payment

of

$20,460.07

for

costs, and in support

thereof

states as follows:

A.

BACKGROUND

1.

Bailey is the owner of the underground

petroleum storage tanks at the service

station

located at

105 North

4

th

Street in Albion, Edwards

County, Illinois, LPC #0470055030, Incident

#20080640--55145.

2. On September

8,

2008, the Agency received from

Bailey

its request for

reimbursement

for

$54,189.78, for the billing period of May 1, 2008 through

July31, 2008, together with all required

engineered certifications, owner/operator billing certifications,

and related Agency forms duly

completed,

and all required supporting documentation

and justification, as required by

applicable law.

3.

All line-item sums requested for reimbursement

were within the Agency’s previously

approved format for early action costs.

4. The amounts requested for reimbursement

were certified by Bailey, on

the Agency’s own

forms, as

being correct and reasonable

and submitted in accordance with applicable

laws, as follows:

The attached application for payment and all

documents submitted with it were

---

prepared

under the supervision of the licensed

professional engineer

or licensed

professional

geologist and the owner and/or

operator who signatures are

set

forth

below and in accordance

with a system designed

to assure that qualified personnel

properly

gathered and evaluated the information

provided. The information

in the

attached

application for payment is, to the

best of my knowledge and belief,

true, and

complete.

The

costs

for

remediating the above-listed

incident are correct, are reasonable,

and

if

applicable, were

determined in accordance with

Subpart H: Maximum Payment

Amounts, Appendix D.

sample

Handling

and Analysis amounts,

and Appendix E

Personnel

Titles and Rates of

35

III. Adm.

Code 732 or 734.

5.

Nevertheless, on January

7, 2009, the Agency prepared its

letter notifying Bailey that

it

was refusing to approve for

payment

$20,460.07

of said costs, the

sole and entire reason for

the

rejection

appearing in the Agency’s

final decision attached hereto

as Exhibit A.

B. DATE ON WHICH THE AGENCY’S FINAL DECISION

WAS SERVED

The Agency’s

final

decision was dated January 7, 2009

and, on information and belief,

was

served on January 8, 2009, making February 12, 2009, the

deadline for the filing of this appeal,

pursuant to Section 40(a)(1) of the Illinois Environmental Protection

Act, 415 ILCS 5/40(a)(1).

This

appeal is timely filed.

C.

CONFIRMATION OF APPROVAL OF

$23,729.71

FOR PAYMENT

Bailey is not appealing the

$23,729.71

approved payment,

and hereby confirms that the

Agency will, in fact, prepare a

voucher

in that amount for submission

to the Comptroller’s Office

for

payment, as funds become

available

based upon the date the Illinois EPA

received the application

for

payment.

D.

GROUNDS FOR APPEALING THE

$20,460.07

IN REJECTED COSTS

1. The majority of the

$20,460.07

costs rejected

by the Agency were costs submitted

per

bidding, which the Agency wrongfully rejected for reasons

nowhere found in applicable

statutes,

regulations, or even on the Agency’s own forms. Specifically,

the Agency rejected

$19,189.59

of the

costs for

four (4) reasons, none of which are reasons

for rejection provided

in applicable statutes,

regulations, or

even on the Agency’s

own forms, to-wit:

a. Per the

Agency, “in

order for the bids to be reviewed, .

.

.

a breakdown of what is

included

2

---

in

the bid. .

. must be provided.” This is legally incorrect.

No statutes or regulations, nor even the

Agency’s own forms, require such “breakdowns”

to be provided, either for purposes of “reviewing”

the

bids or, pertinent

to

this

appeal, for reimbursement of costs.

b. Per the Agency, “in order for the bids to be reviewed,..,

a

breakdown

of what. .

. specific

costs exceed the Subpart H rates must

be

provided.” This

is equally incorrect, as a matter of law.

No

statutes or regulations, nor even the Agency’s

own forms, require such “breakdowns”

to be

provided,

either for purposes of “reviewing”

the bids or, pertinent to this appeal, for reimbursement

of costs.

c.

Per

the Agency,

“in

order for the bids to be reviewed,...

iustification

must be provided to

document why the bids were necessary.” The Agency is legally incorrect

on

this

argument, as well,

since no statues or regulations, nor even the Agency’s own forms, require

such “justification” to be

provided,

either for purposes of “reviewing” the bids or, pertinent to this appeal, for reimbursement

of

cost.

d. Per the

Agency, “in

order for the bids to be reviewed,...

iustification

must

be

provided

to

document. .

.

why the Subpart H rates

could not be met for this project.” This reason for rejection

is

equally

flawed; no statutes or regulations, nor even the

Agency’s own forms, require such

“justification” to be provided, either for purposes of “reviewing”

the bids or, pertinent to this appeal,

for

reimbursement of cost

2. If such “breakdowns” and/or “justifications” were required (which

they were not; indeed,

neither of these terms appear anywhere in the regulations), they would have

been furnished by Bailey

on the Agency’s own forms, in response to the Agency’s request to furnish

same. However, the

Board’s Regulations are

very

clear on this point: bids submitted in accordance

with 35 III. Adm.

Code

734.855

shall include only the degree of specificity required on the form itself,

as prescribed by the

Agency.

The Agency’s forms did not ask for this so-called “breakdown” or

“justification” information.

Bailey

did exactly what the Agency, in its forms, required,

yet

in its rejection

letter the Agency, for

the

first time,

demanded that the information requested on its own forms was

not enough, and that

more

was

needed. This is a fundamentally unfair reason to deny reimbursement,

akin to rejecting bids

on a

3

---

public

project

that fail to conform to

the specifications

first published

after

the bidding

is closed.

3.

None of these

after-the

fact requests for further

information

appear

anywhere

in the

regulations

or in

the form

prepared by the Agency

itself,

which

form

was fully

completed by each

of

the bidders

and by Bailey, as well

as by

Bailey’s

consulting engineer.

The Agency

does not

complain

that the form itself

is incomplete.

4.

Indeed,

at no time during the

Agency’s

consideration

of Bailey’s request

for

reimbursement

did

the Agency request any

further or additional

information concerning

any

particular item

of

remediation

and disposal.

5.

As

to

the remaining

$1,270.48

in wrongfully rejected

costs, the

Agency mistakenly

believes

that

they

lacked

supporting

documentation.

Specifically,

$1,270.48

was deducted

for the cost

for

direct push

drilling, yet all required

information and

supporting documentation

necessary

to reimburse

for this cost, was,

in fact, submitted with

the application,

and is part of this record

6.

To the extent that

the Agency ascertained,

during the

pendency of

the subject request

for

reimbursement,

that

either the facts

or conclusions presented

by Bailey

were inaccurate

or

incomplete, the Agency

had

a duty to disclose

such information

in writing during

the

Agency’s

statutory

review period, but it failed

to do so, and failed

to request additional

or clarifying

information

concerning its purported

reasons for denial.

7. In rejecting

$20,460.07

for costs of reimbursement

for this remediation

work, the Agency

acted arbitrarily

and contrary to the

certified facts presented,

contrary to

its own prior

interpretations

of

applicable laws and policies,

contrary to its own

established

customs

and practices,

and contrary

to

the law.

E. REQUESTED

RELIEF

WHEREFORE,

Petitioner, Bailey Enterprises,

Inc.,

prays that:

(a)

the Agency produce

the

Record; (b) a

hearing be held;

(c) the

Board

find that Bailey’s application

for LUST

reimbursement

contained

all

information

and

documentation

necessary

to support the

$20,460.07

for

costs rejected

by

the Agency, and,

accordingly;

(d) the

Board direct the

Agency to restore

the

$20,460.07

in

costs

4

---

rejected

and

to

prepare a voucher

for

$20,460.07,

and

to

submit that

voucher

to

the Comptroller’s

Office

for payment

as

funds

become available,

based

upon the

date

the

Agency

received

the

subject

application

for payment;

(e) the

Board

grant Bailey

his

attorney’s

fees; and

(f)

the Board

grant Bailey

such

other

and

further relief

as it just.

Respectfully

submitted,

BAILEY

ENTERPRISES,

INC,

Petitioner

By

his attorneys,

MOHAN,

ALEWELT,

PRILLAMAN

&

ADAMI

By:

Patrick

D.

Shaw

By:

Fred

C.

Prillaman

Patrick

D. Shaw

Fred

C.

Prillaman

MOHAN,

ALEWELT,

PRILLAMAN

& ADAMI

1 N. Old Capitol

Plaza,

Ste.

325

Springfield,

IL

62701

Telephone:

217/528-2517

Facsimile:

217/528-2553

THIS

FILING

IS SUBMITTED

ON RECYCLED

PAPER

5

---

ILLINOIS

ENVIRONMENTAL PROTECTION AGENCY

1021 NORTH

GRAND

AVENUE EAST, P.O. Box 19276, SPRINGFIELD, ILLINOIS 62794-9276

— (217)

782-2829

JAMES

R.

THOMPSON

CENTER,

100 WEST RANDOLPH, SUITE 1 1-300, CHICAGO, IL 60601

— (312)

814-6026

ROD R.

BLAGOJEVICH,

GOVERNOR

DOUGLAS P.

Scon, DIRECTOR

217/782-6762

CERTIFIED

MAIL

#

JAN

0

7

2009

7004

2510

0001

8618

2164

Bailey Enterprises, Inc.

Attn: Edward Bailey

P.O.

Box 571

Carlinville, Illinois 62626

Re:

LPC #0470055030 -- Edwards

County

Albion./Bailey

Enterprises,

Inc.

105 North 4th Street

Incident-ClaimNo.: 20080640--

55145

Queue Date: September 8, 2008

Leaking

UST FISCAL FILE

Dear Mr.

Bailey:

The

Illinois Environmental Protection Agency has

completed the

review of

your

application

for

payment

from

the

Underground Storage Tank Fund

for the

above-referenced

Leaking

UST

incident pursuant to Section 57.8(a)

of

the Illinois

Environmental

Protection

Act

(Act),

and

35

Ill. Adm. Code 732, Subpart F. This information

is

dated

September 1, 2008

and

was

received

by the Agency on September 8,

2008.

The application

for

payment

covers

the

period

from

May

1, 2008 to

July

31, 2008. The amount requested

is

$54,189.78.

The deductible amount to be assessed on this claim

is

$10,000.00, which is

being

deducted

from

this payment.

In

addition to the deductible, there

are costs from

this

claim

that

are not

being

paid. Listed

in

Attachment

A are the costs that are not being

paid and the

reasons

these

costs

are

not being paid.

On September

8,

2008, the Agency received

your application

for payment

for

this

claim.

As

a

result of

the

Agency’s review of this application

for payment,

a

voucher for

$23,729.71

will

be

prepared for submission to the Comptroller’s Office

for payment

as

funds become

available

based

upon the

date the Agency received your

complete request

for payment

of

this

application

for payment. Subsequent applications

for

payment that

have

been/are

submitted

will

be

processed based upon

the

date

complete

subsequent

application

for payment

requests

are

received

by

the Agency. This constitutes the

Agency’s final

action with

regard

to

the

above

application(s)

for payment.

ROCEFORD

-4302

North

Main Street, Rockford, IL

61103

- (815)

987-7760

.

DES PEAINES - 9511

W. Harrison St., Des

Plaines,

IL.

- 1847)

ELGIN — 595 South State,

Elgin,

IL

60123

— (847) 608-3131

.

PEORIA - 5415 N.

University

St., Peoria,

L 61614

- (309)

693-5463

BUREAU

OF LAND - PEORIA

— 7620 N. University St., Peoria, IL

61614

— (309) 693-5462

.

CHAMPAIGN — 2125

South

First

Street,

Champaign,

IL 61820

— (217)

278.5800

COWFISVILLE

— 2009

MalI

Street,

Collinsville,

IL 62234

— (618)

346-5120

.

MARION

— 2309W. Main

St., Suite 116,

Marion,

IL

62959

—

(618)

993-7200

PRINTED ON RECYCLED PAPER

---

Page

2

An

vnderground storage tank owner

or

operator may appeal this

final

decision

to the

Illinois

Pollution

Control Board (Board) pursuant to Section 57.8(i) and Section 40

of

the Act

by filing

a

petition for

a

hearing within 35 days after the date of

issuance

of the final

decision.

However,

the

35-day

period

may be

extended for

a

period

of

time not

to exceed

90

days

by

written

notice

from

the

owner or operator and the Illinois EPA

within

the

initial

35-day appeal

period.

If

the

applicant wishes

to

receive

a 90-day

extension, a written

request that includes

a

statement of

the

date

the

final

decision

was

received, along with a copy of this

decision, must be

sent

to the

Illinois

EPA

as soon as possible.

For

information regarding the

request for

an

extension,

please contact:

Illinois Environmental Protection

Agency

Division

of

Legal Counsel

1021 North

Grand

Avenue

East

Springfield, Illinois 62794-9276

217/782-5544

For

information regarding the filing of an appeal,

please

contact:

Illinois Pollution Control

Board,

Clerk

State of Illinois Center

100 West

Randolph,

Suite

11-500

Chicago, Illinois 60601

312/814-3620

If you have any questions

or require further assistance,

please contact

Theresa

Sitton or

Brian Bauer of my

staff at

217/782-6762.

Sincerely,

L

John

Sherrill,

Manager

Financial Management Unit

Bureau

of Land

JS :TS :mls\08 0073

.doc

cc:

CW3M

Company

LCU File

Theresa

Sitton

---

Attachment A

Technical Deductions

Re:

LPC #0470055030

-- Edwards

County

Albion / Bailey

Enterprises

105

North

4

th

Street

Incident-Claim No.:

20080640 -- 55145

Queue Date: September 8,

2008

Leaking UST

Fiscal File

Citations

in this attachment are from the

Environmental

Protection

Act

(Act),

as amended

by

Public Act

92-0554 on June 24,

2002,

and 35 Illinois Administrative Code

(35 111.

Adm.

Code).

Item

#

Description

of

Deductions

$20,460.07

for costs that lack supporting

documentation and

justification.

Pursuant

to

35

Ill.

Adm. Code 734.605(b)(9) and 734.630(cc), application

for

payments

must

include

an

accounting

of

all

costs, including but not limited.to,

invoices,

receipts,

and

supporting

documentation

showing

the dates

and

descriptions of the

work performed.

In

addition,

reasonableness

of

costs cannot be determined without

documentation.

Pursuant

to

734.63 0(ee), costs

incurred during

early action that are

unreasonable

are

ineligible.

*$

1,270.48 Direct Push Drilling.

*$

15,884.41

Excavation, Transportation, and Disposal.

*$

3,305.18

Backfill.

$19,189.59

of the

costs

above were submitted

per bidding.

In order

for the

bids to

be

reviewed pursuant

to

35

Ill. Adm.

Code 734.855,

a breakdown of

what is

included

in

the

bid

and what specific costs exceed

the

Subpart

H rates must

be provided.

Justification

must be

provided

to

document why

the bids were

necessary and why

the Subpart

H rates

could not be

met

for

this project.

Therefore,

such costs are

not approved

pursuant

to Section

57.7(c)(3) of

the Act

because

they

may be used

for site investigation

or corrective

action

activities

in excess

of

those

required

to

meet

the minimum requirements

of Title XVI of the

Act.