March 7, 2012 Meeting Minutes




MARCH 7, 2012

John Polak, Chairperson, called the Drycleaner Environmental Response Trust Fund Council of Illinois to order at 2:05 p.m. A quorum was present. Roll call was taken with the following members present:

John Bredenkamp
Young B. Kim
Paul Kwak
Jerry Lewicki
John Polak
(via telephonic conference)

Also present were:
H. Patrick Eriksen, Program Administrator's Office
John J. McCarthy, Program Counsel

Juho So, Program Administrator's Office


The minutes from the January 18, 2012 Council meeting were reviewed. On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the minutes were approved by a vote of 5-0.


Mr. Eriksen reviewed background information with the Council noting that Mr. Tom Davig is the owner/operator of Davigs Custom Cleaners located at 2625 N Mulford Rd in Rockford, IL. The facility has been licensed since the Fund’s inception through December 31, 2011. In 2007, Mr. Davig converted his drycleaning machine from using perchloroethylene (perc) to DrySolv.

Mr. Eriksen reviewed the gallons of DrySolv used by the drycleaning facility for the years 2007 through 2010. The annual license fee for those years was $1,500. In early 2011, Mr. Davig began experiencing mechanical problems with his drycleaning machine, which resulted in increased solvent usage. Replacement of the evaporation coil, related gaskets and seals did not resolve the issue, resulting in the purchase of 185 gallons of solvent in 2011. In late December 2011, Mr. Davig leased a new drycleaning machine made specifically for DrySolv.

Mr. Davig is requesting the Council reduce his 2012 license fee from the projected $3,750 fee to $1,500, due to the significant mechanical problems he experienced in 2011. He provided invoices to the Administrator substantiating his repairs. The invoices totaled in excess of $9,000.

Mr. Davig addressed the Council reiterating what Mr. Eriksen had summarized for them. During 2011 he spent considerable time and money trying to repair his machine. He stated the excess solvent vaporized during machine operation.

Mr. Kim stated he did not understand how so much solvent was wasted based on the repairs that were made. Mr. Davig responded they were never successful in getting all the gaskets and seals to hold properly once the initial repairs were made in early 2011. Mr. Polak commented based on prior Council decisions and the events Mr. Davig experienced, it would be reasonable to consider reducing his license fee.

After additional discussion by the Council, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 5-0 to reduce Mr. Davig’s 2012 license fee from $3,750 to $1,500, based on the mechanical problems incurred in 2011.


Legislative Update:


Mr. Eriksen reviewed with the Council that HB4526, EPA-Perchloroethylene Ban sponsored by Rep. Michael Zalewski and Rep. Kelly Cassidy, is similar to last year’s SB1617 that banned perc, except that it removes the January 2030 date for banning the use of perc at a drycleaning facility. The bill passed out of the Environmental Health Committee on February 21, 2012 by a vote of 13-1-4.

HB4150, EPA-Perchloroethylene Ban, sponsored by Rep. Kelly Cassidy, is identical to SB1617 that was introduced by Illinois EPA last year. The Illinois EPA did not request this bill nor are they currently supporting it. It is assigned to be heard by the Environmental Health Committee on Thursday, March 8, 2012 at noon.     

HB4488, sponsored by Rep. Michael Tyron, would amend the Drycleaner Environmental Response Trust Fund Act (415 ILCS 135/45) by adding a new paragraph under the insurance account of the Act and would allow an owner or operator who has their insurance coverage cease for reasons other than submittal of a claim on that account or the existence of an emergency or emergency action to reenroll in the insurance program, provided the owner/operator pays the annual premium calculated using the same risk basis on the date the owner/operator was last covered under the account. This bill is scheduled to be heard by the Environment and Energy Committee today, Wednesday, March 7, 2012 at 4 p.m. Mr. Eriksen noted that on behalf of the Council members, he filed a hearing witness slip opposing HB4488, as the proposed language is not needed as the Council currently will allow immediate reenrollment of insurance coverage by someone who has had their coverage terminated. In addition, there are three (3) shell bills that have been introduced and sponsored by Rep. Tryon. Senate President Cullerton has also introduced a shell bill involving the Drycleaner Trust Fund Act.

Mr. Eriksen stated he would keep the Council updated as to future legislative developments.

  B. Update on Industry Meeting:

Mr. Eriksen updated the Council on the two (2) hour industry meeting held Tuesday afternoon, March 6, 2012 at the Wyndham Hotel in Lisle, IL. He noted there were 15 in attendance, including Dr. So and himself, representing the Fund. The two (2) drycleaning associations and the five (5) compliance programs were all represented at the meeting. He stated a good discussion was had as they reviewed nine (9) different financial projection scenarios. Three (3) scenarios reflected the financial impact if the program’s sunset date is not extended; three (3) more scenarios if it was extended 5½ years to June 30, 2025, and three (3) additional scenarios if it was extended 10½ years to June 30, 2030.

Members participating in the meeting stated they believe other revenue sources need to be considered to try and provide new funding for the Fund. These sources include licensing of drop stores, possibly seeking contributions from solvent manufacturers, and the feasibility of a gross receipts for sales tax on drycleaning services. Mr. Eriksen reviewed in detail with the Council the discussion on those three (3) potential revenue topics.

The industry group is planning to meet again in early June and attempt to formulate a recommendation to the Council on what should be done regarding the projected Fund deficit so the Council could consider it at their Strategic Planning meeting in August. The three (3) recommendations brought forth by Peter Marberry at the January 18, 2012 meeting were discussed by the group.

The Council had general questions for Mr. Eriksen regarding the meeting. Mr. Eriksen noted there was no consensus among the members participating in how the projected Fund deficit should be addressed.

  C. Audit of Compliance Programs:

Mr. Eriksen reviewed with the Council that he would like to change the date of the audit from Wednesday, April 4, 2012 to Thursday, April 5, 2012, at the Wyndham Lisle Hotel to accommodate scheduling conflicts for one of the Council members. The members in attendance agreed to move the meeting date to April 5th and determined they would like the meeting to begin at 10:00 a.m. Mr. Eriksen reviewed the number of files selected by compliance programs for review. He stated he would no longer approve Trust Fund and/or industry updates for continuing education credits unless the updates are presented by the Administrator’s staff or the Administrator. Recent updates have resulted in inaccurate or misleading information being provided to the drycleaners attending the continuing education seminars.


Mr. Eriksen noted the following bills were before the Council for the Council's review and action.

  1. Williams & Company Consulting, Inc  $98,719.00
    Standard flat fee billing for January 2012, licensing, underwriting, claims processing and site inspections.
  2. John J. McCarthy  $4,510.80
    Professional legal services to the Council for the period of January 7, 2012 through February 25, 2012.
  3. Johnston, Greene, LLC  $3,047.50
    Professional legal services provided by Iain Johnston as administrative law judge for January 2012.
  Mr. Eriksen carried in to the meeting:.
  4. Williams & Company Consulting, Inc  $71,465.00
    Standard flat fee billing for February 2012, licensing, underwriting, claims processing and site inspections.

Mr. Eriksen noted that Williams & Company's January and February bills were comparable to the previous year, with the main difference in the billings being the number of drycleaners licensed in each month.

On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council approved the bills as presented by a vote of 5-0.


Mr. Eriksen reviewed with the Council the January 2012 monthly activity report, which reflected that 625 drycleaners were licensed at the end of January 2012. As of March 6, 2012, there were 810 licensed drycleaners with 47 applications in house to be reviewed and/or processed. Insured drycleaners totaled 526; remedial claims totaled 258, with estimated reserves of $28.9 million. Mr. Eriksen noted the number of licensed drycleaners as of March 6, 2012 is approximately 40 less than one (1) year ago.

The Fund balance as of January 31, 2012 is $2,958,782; year-to-date remedial claim payments total $1,398,570.


Mr. Eriksen noted there were two (2) claim payment requests in excess of $75,000 requiring Council review and approval.


Kustom Kleen Cleaners, Arlington Heights, IL; Claim #50158;
Site #0001297:


Dr. So reviewed background information with the Council noting activity on the facility since 2006 has focused on obtaining No Further Remediation (NFR) letters for the two (2) adjacent properties impacted by the drycleaning solvent contamination. These NFR letters were obtained in November 2010 and effectively eliminated further site investigation and potential remedial activities in those directions. The focus is now to complete the site investigation and delineation activities on the site itself. The consultant is requesting $25,000 to do additional site assessment work at the facility.

On a motion by Mr. Lewicki and a second by Mr. Kim, the Council approved the budget request of $25,000 by a vote of 5-0.


Royal Cleaners, Des Plaines, IL; Claim #50438; Site #0002242:


Dr. So reviewed background information with the Council noting that a pilot study was previously completed at this facility and was successful in demonstrating the ability to reduce the Csat level of PCE contamination. The budget request is for implementation of a full-scale remediation project involving BIOX. Proposed costs, including a 20% contingency, is $110,000. In addition, the Administrator is requesting waiver of the two (2) bid requirement for the environmental consultant due to the extensive knowledge and understanding the environmental consultant has regarding the facility.

On a motion by Mr. Lewicki and a second by Mr. Kim, the Council approved the $110,000 in full-scale remediation and waiver of the two (2) bid requirement by a vote of 5-0.


Mr. Eriksen referenced the three (3) enclosures in the Council packet. The first references a drycleaning business in Akron, Ohio was fined $10,000 for violating Ohio’s air pollution control laws. The second is the current issue of the Illinois Ethics Matters newsletter and the third is an article which states a recent study indicated that perchloroethylene can increase the risk of developing bi-polar disorder and post-traumatic stress syndrome.

Mr. Eriksen noted the next Council meeting is scheduled for Thursday, April 5, 2012, beginning at 10:00 a.m.

Mr. Eriksen attended the Fund’s Senate appropriation hearing on Wednesday, February 29, 2012. The Council’s requested amount of $5,360,000 is the same as it has been for the past three (3) years. The House hearing is scheduled for mid-April.
  Mr. Polak asked if there were any comments from the public. There were none.

On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 5-0 to go in to Closed Session 2:45 pm to discuss matters of potential litigation. The motion passed by a vote of 5-0. The Council adjourned from Closed Session at 2:55 pm.

In Open Session, on a motion by Mr. Kim and a second by Mr. Lewicki, the Council voted 5-0 to reduce the license late payment fees for MG Cleaners to $850 and accept the proposed payment plan.

Regarding Cleaners Depot, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 5-0 to allow Cleaners Depot to pay their $10,500 in civil penalties in $1,000 monthly payments beginning April 1, 2012.

There being no further business, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council adjourned at 2:58 pm.

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