APPELLATE COURT OF ILLINOIS, THIRD DISTRICT
544 N.E.2d 82, 188 Ill. App. 3d 349, 135 Ill. Dec. 725 1989.IL.1349
Petition for review of order of Pollution Control Board.
JUSTICE SCOTT delivered the opinion of the court. BARRY and STOUDER, JJ., concur.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE SCOTT
The City of East Moline (East Moline) appeals from a decision of the Illinois Pollution Control Board (Board) wherein the Board affirmed the Environmental Protection Agency's (Agency's) denial of East Moline's application for a National Pollution Discharge Elimination System permit for the operation of East Moline's public water supply treatment facility.
The underlying facts of this appeal are generally undisputed. On May 15, 1986, East Moline applied to the Agency for an NPDES permit for the discharge of waste water from its public water treatment facility into the Mississippi River. The application represented that the maximum daily concentration of total suspended solids in the plant's discharge was 20,000 mg/1 with normal concentrations at 10,000 mg/1. Thus, East Moline requested a permit be issued with a TSS limitation of 20,000 mg/1. The Agency issued a draft permit proposing that the TSS discharge be limited to 15 mg/1 as a 30-day average and 30 mg/1 as a daily maximum. East Moline filed objections to the proposed permit and also submitted a formal written comment to the Agency, wherein it argued the proposed TSS limitations were arbitrary, unreasonable and invalid as applied to East Moline and, therefore, requested the Agency to revise the permit to the original standard of 20,000 mg/1 it previously requested. As support for its position, East Moline noted the current economic hardship it was facing due to loss of industry and the inadequate funds available to install control equipment to meet the Agency's proposed limitation levels. The Agency, at the hearing before the Board, stipulated that certain meetings regarding East Moline's inability to meet the limitations and Discussions regarding environmental impact took place, although no documentation of these meetings was included in the Agency record before the Board. Despite East Moline's objections, on November 20, 1986, the Agency issued to East Moline an NPDES permit subject to the TSS limitations as previously outlined in its draft permit.
On December 19, 1986, East Moline filed an NPDES permit appeal with the Board challenging the TSS limitation imposed by the Agency permit on the grounds the regulations establishing the limits were arbitrary, unreasonable and invalid as applied to East Moline, because of the cost of compliance and the nonadverse impact of the present discharge on the water quality of the Mississippi River. A hearing was held before a hearing officer August 28, 1987. East Moline attempted to present testimony and admit exhibits into evidence regarding the cost of compliance with the TSS restriction and a study concerning the environmental impact of the current discharge level. The hearing officer disallowed the evidence on the basis that it had not been submitted to the Agency and was, therefore, beyond the scope of review. The Board upheld the hearing officer's decision and subsequently denied East Moline's appeal.
Two issues are presented for review. First (issue 1), whether a petitioner can challenge the validity of a regulation as applied in the context of a permit application and appeal, and second (issue 2), whether a petitioner can submit evidence not previously presented to the Agency at a hearing before the Board hearing officer. The questions presented are issues of law, not of fact.
Regarding issue 1, the Agency permit issued to East Moline restricted the TSS discharge in accordance with regulation 35 Illinois Administrative Code section 304.124(a) (1985), which prohibits discharge of effluent containing TSS in excess of 15 mg/1. East Moline has made no claim that the regulation does not control its public water discharge facility, nor does East Moline claim that the regulation was improperly promulgated and therefore is arbitrary and unreasonable in a general sense. Instead, East Moline argues that because it cannot comply with the TSS limitations for financial reasons, or because East Moline's discharge, at present levels, does not create an adverse economic impact, the regulation is invalid as applied to East Moline's facility.
East Moline cites Celotex Corp. v. Pollution Control Board (1983), 94 Ill. 2d 107, 445 N.E.2d 752, Village of Cary v. Pollution Control Board (1980), 82 Ill. App. 3d 793, 403 N.E.2d 83, and Central Illinois Public Service Co. v. Pollution Control Board (1976), 36 Ill. App. 3d 397, 344 N.E.2d 229 , for the proposition that a permit applicant may challenge the application of a regulation in a permit appeal on the basis that the rule as applied to the particular individual or entity would impose an arbitrary and unreasonable hardship. Our review of these cases, however, reveals that East Moline has misconstrued the holdings, and these cases are not determinative of the issue at hand.
East Moline's application for permit was made pursuant to section 39 of the Illinois Environmental Protection Act (the Act) (Ill. Rev. Stat. 1987, ch. 111 1/2, par. 1039). Section 39(a) of the Act states "it shall be the duty of the Agency to issue such a permit upon proof by the applicant that the facility . . . will not cause a violation of this Act or of regulations hereunder." Further, "[i]n granting permits the Agency may impose such conditions as may be necessary to accomplish the purposes of this Act, and as are not inconsistent with the regulations promulgated by the Board hereunder." (Ill. Rev. Stat. 1987, ch. 111 1/2, par. 1039(a).) Section 39(b) of the Act specifically allows the Agency to issue NPDES permits as defined in the Federal Water Pollution Control Act Amendments of 1972 (P.C. 92-500) (33 U.S.C.A. § 1251 et seq. (1985)), and further, allows for conditions to be imposed to accomplish the purposes of this Act, including effluent limitations. (Ill. Rev. Stat. 1985, ch. 111 1/2, par 1039(b).) If the Agency refuses to grant a permit or grants a permit with conditions under section 39, the aggrieved party may file a petition for hearing with the Board. "At such hearing the rules prescribed in Sections 32 and 33(a) of this Act shall apply, and the burden of proof shall be on the petitioner." (Ill. Rev. Stat. 1987, ch. 111 1/2, par. 1040(a)(1).) Section 32 of the Act outlines hearings and states that any party "may make oral . . . testimony, cross-examine witnesses, or take any combination of such actions. Ill. Rev. Stat. 1987, ch. 111 1/2, par. 1032.
Generally, the issue to be decided at a permit hearing is whether the applicant can demonstrate that no violation of the Act would occur if the permit was issued or that no violation would occur if the permit was issued without special conditions. (Ill. Rev. Stat. 1987, ch. 111 1/2, par. 1039(a); see also Joliet Sand & Gravel Co. v. Pollution Control Board (1987), 163 Ill. App. 3d 830, 516 N.E.2d 955.) The cases of Celotex and CIPS, however, stand for the proposition that a permit applicant may challenge the validity of a Board regulation at a permit hearing. In Celotex, the Agency contended that section 29 of the Act sets forth the exclusive method for challenging a regulation by taking action within 35 days of its adoption. (Ill. Rev. Stat. 1987, ch. 111 1/2, par. 1029.) Thus, the Agency contended the only means for testing the validity of a regulation after a permit denial is to request the Board to change the regulation under section 28 of the Act (Ill. Rev. Stat. 1987, ch. 111 1/2, par. 28). The Celotex court stated that there is nothing in the Act indicating the General Assembly intended to deprive one the opportunity to challenge the validity of a regulation simply because the regulation was not challenged immediately after its adoption. The court further stated the absurdity of the Agency's position was clear if the applicant was not in business 35 days after adoption of the regulation. (Celotex, 94 Ill. 2d 107, 445 N.E.2d 752.) Thus, the court held that since the regulations, upon which the Agency based its permit denial, were invalid as improperly promulgated, the permit applicant was entitled to test the validity of the regulations at the permit application hearing. (Celotex, 94 Ill. 2d 107, 445 N.E.2d 752.) Celotex, however, does not address the issue of whether the validity of a regulation can be challenged as applied to the applicant for the reasons stated by East Moline in the present case. The CIPS court also reached the same decision as the Celotex court and was cited in Celotex as authority and also similarly fails to address the issues at hand. We completely agree with these decisions but find them inapplicable to this issue.
On the other hand, the Cary decision, also cited by East Moline, holds that the validity of a regulation as applied may be challenged at a Board hearing. We agree with Cary because the central reason for a variance is that the regulation as applied to a petitioner would be arbitrary or unreasonable. Again, however, ...