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September 21, 1995


Administrative Review of the Illinois Pollution Control Board. No. 93-59.

As Corrected December 6, 1995.

Honorable James A. Knecht, P.j., Honorable Robert W. Cook, J., Honorable Frederick S. Green, J., Concurring

The opinion of the court was delivered by: Knecht

PRESIDING JUSTICE KNECHT delivered the opinion of the court:

Petitioner, Freedom Oil Company (Freedom), filed its petition for direct review in this court of a supplemental opinion and order of the respondent, Illinois Pollution Control Board (Board). (People v. Freedom Oil Co. (June 6, 1994), Ill. PCB Supp. Op. 93-59.) The order appealed from changed the amount of the penalty assessed against Freedom as recited in a previous opinion and order (People v. Freedom Oil Co. (May 5, 1994), Ill. PCB Op. 93-59) (hereinafter Freedom Oil). Freedom challenges (1) the result of the June 6 special meeting, which it argues was not a valid meeting (415 ILCS 5/5(a) (West 1992)); (2) the Board's characterization of the change in penalty as a clerical error; and (3) the Board's authority to hold a meeting by telephone conference call. The Board questions this court's jurisdiction over Freedom's petition for review. We have jurisdiction and affirm the Board's opinion and order.

On March 19, 1993, the Illinois Attorney General (AG), on behalf of the People of the State of Illinois (the People) and at the request of the Illinois Environmental Protection Agency (IEPA), filed a two-count complaint with the Board against Freedom. The violations alleged involved the failure to investigate and report releases from underground storage tanks at two separate locations owned by Freedom. The People sought a $30,000 penalty for each release and an additional $10,000 for each day the violations continued.

After a hearing, the Board found Freedom to be in violation of IEPA regulations at both of its facilities. In post-hearing briefs filed by the parties, the AG sought and Freedom Oil opposed imposition of a $30,000 civil penalty for the two incidents of releases from the underground tanks. In its 13-page written order issued on May 5, 1994, the Board assessed a penalty of $15,000 against Freedom in setting forth the following reasoning:

"Examining the duration of the violations, again we consider that the release at the Savoy site was recorded on November 22, 1989, almost 3 and 1/2 years before the complaint was filed in this action on March 19, 1993. The release at the Oblong site was reported on April 4, 1991, almost 2 years before this action was filed. In the interim, the Agency sent Freedom three letters concerning the Savoy site and two letters concerning the Oblong site. In each letter, the Agency notified Freedom of the information it must collect at each site, and that the same must be submitted to the Agency. Even with these letters, Freedom did next to nothing to comply, and, as of this date, Freedom still has not complied with the applicable investigation and reporting requirements. Freedom's recalcitrance demonstrates a lack of due diligence to comply with the Board's regulations.

Addressing the gravity of the violation, again we must correct Freedom. These violations are not mere paper violations. Without the required reports and sampling data, the Agency has no way of knowing the extent of contamination that may exist at either site. For at least 3 and 1/2 years and two years at the Savoy and Oblong sites, respectively, the presence of ground water, as well as soil, contamination remained undetermined. The reporting requirements are there to prompt the investigation necessary to determine the extent of contamination and remediation. Left uninvestigated, the pollution can migrate and cause more damage than it did initially. Not only did Freedom fail to submit the reports despite the Agency's repeated requests for them, it also failed to undertake the investigations required at each site to insure that the environment is protected.

Until the extent of contamination is known at each site, the economic benefit accrued by Freedom due to its recalcitrance cannot be accurately determined. While the cost of the investigations could be estimated, the costs saved by deferring any necessary remediation cannot be. Without the investigation, we only know that the remedial costs could range between zero and multiple millions of dollars. ***

Freedom's failure to comply, the fact that the extent of contamination remains unknown because of that failure, and Freedom's recalcitrance over the three year period lead the Board to conclude it must assess a penalty sufficient to deter continuing violations at these sites and future violations at other UST sites owned by Freedom. The Act authorizes the Board to assess a civil penalty of up to $50,000 per violation, and an additional civil penalty of not to exceed $10,000 for each day during which a violation continues.

The Agency seeks a penalty of $30,000 and an award of costs and fees pursuant to Section 42 of the Act. In support of a penalty in that amount, the Agency cites Freedom's blatant disregard for the applicable regulations. For the most part, Freedom ignored the Agency's letters warning Freedom that it was in possible violation of those regulations. Freedom went so far as to promise soil sampling in its response to the NORL for Savoy, but then went on to ignore the subsequent CIL and Pre-Enforcement Conference Meeting letter sent by the Agency. Concerning the Oblong site, Freedom did submit reports but only after it received a CIL and, thereafter, it ignored the Agency's request for more information concerning the extent of contamination evidenced by those reports. Finally, Freedom has taken no action to correct the contamination at the Oblong site, and simply submitted information insufficient for the Agency to determine if remediation is necessary due to the release at the Savoy site.

The Board finds that Freedom acted with knowledge of and blatant disregard for the applicable Board regulations. The Board further finds no facts or circumstances which would mitigate the penalty requested. Therefore, the Board orders Freedom *** to pay a penalty of $15,000 into the Environmental Protection Trust Fund. In setting this penalty amount, we have considered the costs Freedom saved through its refusal to property investigate either site, the costs saved through its refusal to submit adequate 20[-] and 45[-]day reports at either site, and its recalcitrance in the face of repeated attempts by the Agency to obtain this information. We have also considered the increased threat to the public health and welfare posed by the delay in quantifying the releases, and ...

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