March 12, 2014 Meeting Minutes

  MINUTES
 

DRYCLEANER ENVIRONMENTAL RESPONSE TRUST FUND
COUNCIL of ILLINOIS

CHICAGO MARRIOTT NAPERVILLE
NAPERVILLE, ILLINOIS

MARCH 12, 2014

John Polak, Chairperson, called the Drycleaner Environmental Response Trust Fund Council of Illinois meeting to order at 10:03 a.m. A quorum was present. Roll call was taken with the following members present:

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

Also present were:
H. Patrick Eriksen, Program Administrator's Office
John McCarthy, Program Counsel
Juho So, Program Administrator's Office
Yong Kim, Program Administrator's Office

PRELIMINARY BUSINESS

Mr. Polak noted that Mr. McCarthy had not yet arrived at the meeting and requested moving off the agenda to begin with agenda item #3, “Approval of Program Billings.”

  APPROVAL OF PROGRAM BILLINGS
 

Mr. Eriksen reviewed the bills included in the January 29, 2014 Council packet. They were as follows:

  1. Williams & Company Consulting, Inc         $10,399.00
Standard flat fee billing for December 1-7, 2013, licensing, underwriting, claims processing and site inspections.
 

2. Williams & Company Consulting, Inc          $45,694.00
Standard flat fee billing for
December 8-31, 2013, licensing, underwriting, claim processing and site inspections.

This billing reflected a 1.2% cost of living increase per Williams & Company’s contract with the Council.

  3. John J. McCarthy                                      $6,555.00
Professional legal services for the period of November 21, 2013 through January 18, 2014.
  4. Midwest Litigation Services                                      $409.00
Transcript copies from administrative law judge hearing of December 18, 2013 for John J. McCarthy.
 

In addition, Mr. Eriksen noted the following bills were emailed to the Council prior to the January 29, 2014 meeting:

  1. Midwest Litigation Services                                      $947.30
Transcript copies from administrative law judge hearing of December 18, 2013.
  2. Hinshaw & Culbertson, LLP                                      $2,571.69
November and December 2013 professional legal fees in conjunction with December 18, 2013 administrative law judge hearings.
 

Included in the February 2014 Council packet were the following bills:

  1. Williams & Company Consulting, Inc          $96,156.00
Standard flat fee billing for January 2014, licensing, underwriting, claims processing and site inspections.
  2. John J. McCarthy                                      $4,340.00
Professional legal services to the Council for the period of January 19, 2014 through February 8, 2014.
  Mr. Eriksen noted all of the January and February Council packet bills had been individually approved by six (6) of the seven (7) Council members.
 

Included in the March 2014 Council packet were the following bills:

  1. Williams & Company Consulting, Inc          $74,131.00
Standard flat fee billing for February 2014, licensing, underwriting, claims processing and site inspections.
 

2. John J. McCarthy                                      $4,340.00
Professional legal services to the Council for the period of February 9, 2014 through March 3, 2014.

 

On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the bills were approved by a vote of 6-0.

  REVIEW OF ACTIVITY REPORT AND FINANCIAL STATEMENTS
 

Included in the Council packet were the monthly activity reports for January and February 2014 and December 2013. Mr. Eriksen noted as December 31, 2013, 982 drycleaners were licensed in 2013 compared to 1,017 for 2012, for a reduction of 35 licensed drycleaners. As of March 10, 2014, 746 licenses have been issued, with 778 renewal applications received. This is approximately 51 fewer drycleaning facilities as compared to the prior year.

As of December 31, 2013, open remedial claims totaled 208, with estimated reserves to close out those claims set at $24.5 million. As of December 2012, the total number of open claims was 230, with estimated reserves of $26.7 million; 22 claims were closed during calendar year 2013.

The December 31, 2013 financial statements reflect a fund balance of $2,662,546, compared to the December 31, 2012 fund balance of $3,017,000. Fiscal year-to-date claim payments total $1,149,622.

  CLAIM PAYMENTS IN EXCESS OF $75,000
 

Mr. Eriksen noted there were nine (9) payment requests needing Council review and approval.

 

A.

Classic Cleaners, Decatur, IL; Claim #50045, Site #0001103::

   

Dr. So reviewed with the Council that the Administrator is requesting budget approval for $6,064, including contingency costs, to close and abandon approximately 20 monitoring wells at the drycleaning facility. A No Further Remediation (NFR) letter was recorded on May 30, 2013.

On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the $6,064 in monitoring well closure costs were approved by a vote of 6-0.

 

B.

Spotless Cleaners, Lombard, IL; Claim #50261, Site #0002125:

   

The Administrator is requesting budget approval for $148,000 in remedial action costs. Dr. So reviewed background information with the Council noting substantial site investigation work has been conducted at the facility over the past 12 years. The Remedial Action Plan (RAP) was approved by the Illinois Environmental Protection Agency (IEPA) on October 31, 2013.

The site has soil contamination in excess of the Csat limit and the proposed remedial action plan is a chemical oxidation injection over a period of time with the goal to reduce the soil contamination level below the site specific Csat limit. The Administrator has reviewed the cost and the scope of work and concurs with the work plan proposed by the environmental consultant.

In addition, the Administrator is requesting waiver of the two (2) bid requirement for consulting costs as the environmental consultant has extensive knowledge regarding the site specific conditions at the facility.

On a motion by Mr. Lewicki and a second by Mr. Young B. Kim, the Council approved the remedial action budget request of $148,000 and waiver of the two (2) bid requirement by a vote of 6-0.
  C.

Lee’s L&L Cleaners, Arlington Heights, IL; Claim #50262, Site #0001313:

   

The Administrator is requesting budget approval for $35,000 related to closure of a drinking water well and connection of an offsite property to city water. Dr. So reviewed background information noting environmental modeling indicated the contamination will migrate offsite of the existing property in a southwesterly direction. The environmental consultant proposed the use of engineered barriers to address exceedance of the Tier I soil remediation objectives on the south adjacent property, including the prohibition to use groundwater for potable water sources. The property owner south of the drycleaner property was contacted regarding the environmental land use restriction and notified the consultant they were using a previously unidentified water well for potable water at the residence on the site. In order to obtain a NFR letter for the drycleaning facility, the offsite water well must be addressed. After a period of negotiation with the property owner, the consultant provided an addendum to the remedial action completion report in which Illinois EPA was notified the water well would be closed and the residence connected to city water supply. The cost of such proposed activities is $35,000.

After additional discussion by the Council, on a motion by Mr. Lewicki and a second by Mr. Kim, the Council approved $35,000 in costs to abandon the offsite property well and hook up the offsite residence to city water by a vote of 6-0.

  D.

North Suburban Cleaners, Morton Grove, IL; Claim #50421, Site #0001401:

   

Dr. So reviewed with the Council that the drycleaning facility has a priority ranking score of 58 and has not been released for funding by the Council.

The facility has high levels of soil contamination (up to 10,000 mg/kg). The previous environmental consultant conducted site investigation activities at this facility in 2003 and 2004. The drycleaning facility is part of a small strip mall and residential properties surround the drycleaning facility to the north, west and east. Directly to the south of the property is a high school. 

Due to the high level of soil contamination and because the drycleaning facility is surrounded by residential properties and a high school, a representative of the IEPA contacted the Fund requesting the Council release funding to conduct additional site investigation activities at the facility and conduct offsite soil gas investigations to determine if solvent vapors have migrated to the surrounding properties.

The Administrator is requesting that the Council release for immediate funding a total of $25,000 for offsite soil gas investigations and additional site investigation activities at the facility to further quantify and determine potential health concerns raised by the IEPA regarding this property.

On a motion by Mr. Young B. Kim and a second by Mr. Lewicki, the Council approved the immediate release of $25,000 for the necessary offsite soil gas investigations and additional site investigation activities at the facility by a vote of 6-0.
  E.

Ravinia Vogue Cleaners, Highland Park, IL; Claim #50312, Site #0002257:

   

Mr. Eriksen reviewed the memorandum included in the Council packet noting this is a unique property and project that is going to entail significant renovation of the existing drycleaning facility in order to obtain an NFR letter from the IEPA. Mr. Eriksen briefly summarized some of the renovations that were necessary at the facility and stated he was requesting Council guidance as to what costs should be considered eligible for reimbursement from the Fund. He noted the $7,200 in asbestos removal costs submitted in the environmental consultant’s proposal were not eligible as the Council has previously taken the position that remediation of chemicals/contaminants other than those related to drycleaning solvents would not be eligible for reimbursement from the Fund. Mr. David Kay of Laicon, the environmental consultant, was in attendance at the meeting and would review in further detail the proposed scope of work and address any questions the Council may have regarding the proposed RAP and associated costs.

Mr. Kay commented that to obtain an NFR letter on the property, soil gas inhalation pathways needed to be addressed per the new indoor inhalation rules that went into effect July 1, 2013. To properly address the indoor inhalation issues requires the existing wood floor be removed, all utility lines that currently run underneath the floor be relocated above the floor, and that an appropriate vapor barrier and a cement floor be installed. The proposed cost to complete the remediation before any contingencies is $216,000, which when combined with the funds that have already been reimbursed by the Fund puts the total reimbursement costs close to the Council’s maximum $300,000 remedial benefit.

Mr. Kay acknowledged the drycleaner, who is also the real estate owner, is getting improvements to his property but did not ask for such improvements. In addition, his facility will be shut down for at least a period of 4-6 weeks, in which he has to make other arrangements for handling his drycleaning, including the drop-off and pick-up of all drycleaning items. Mr. Kay stated because of the Council’s prioritization requirement, the drycleaner at the facility was not able to address cleanup of the contamination prior to the July 1, 2013 effective date of IEPA’s indoor air inhalation regulations. 

After a lengthy discussion by the Council, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 6-0 to authorize the Administrator to negotiate line item costs with the environmental consultant and bring back a final budget for Council review and approval. In addition, with the exception of the asbestos costs listed in the proposal, the Council agreed that all of the costs were eligible remedial action costs necessary to obtain an NFR letter from the Illinois EPA.

 

Mr. McCarthy arrived at the meeting at 10:15 a.m.

  F.

State Cleaners, Belleville, IL; Claim #50821, Site #0001885:

   

The Administrator is requesting budget approval for $43,000 to perform an additional chemical oxidant injection and confirmatory site investigation activities. Dr. So reviewed background information on the facility noting a recent post remedial confirmatory site investigation shows a significant reduction of contamination. There are still some additional hot spots that need to be dealt with prior to obtaining a NFR letter for the facility. The proposed additional chemical oxidation injections will hopefully result in the cleanup goals being met.

On a motion by Mr. Young B. Kim and a second by Mr. Lewicki, the budget request of $43,000 was approved by a vote of 6-0.
  G. Speedy One Hour Cleaners, East St. Louis, IL; Claim #50820, Site #0002161
   

The Administrator is requesting budget approval for $51,240 for additional remedial action at the facility. Dr. So reviewed background information noting that chemical oxidant injections have been completed but that additional remediation action to an offsite property is required in order to get a NFR letter for the drycleaning facility and the contaminated offsite property. It is anticipated at this time the total remediation costs will not exceed the $300,000 cap.

On a motion by Mr. Lewicki and a second by Mr. Young B. Kim, the Council approved the $51,240 in remedial action costs by a vote of 6-0.
  H.

Darien Cleaners, Darien, IL; Claim #50201, Site #0001152:

   

The Administrator is requesting budget approval for $7,409 to close monitoring wells at the facility. Dr. So noted a NFR letter has been issued for the facility and this is the last necessary step to bring closure to the claim.

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved the $7,409 in monitoring well abandonment costs by a vote of 6-0.

  I.

Scot Cleaners, Evanston, IL; Claim #50222, Site #0001515:

   

The Administrator is requesting $227,500 in remedial costs at the drycleaning facility. Dr. So reviewed background information noting that the proposed remedial action plan is a combination of soil excavation and mixing along with chemical oxidation injections via Chemical Oxidant Retention Ponds (CORPs). In addition, the Administrator is requesting the Council waive the two (2) bid requirement inasmuch as the environmental consultant has conducted extensive site investigation activities at the facility and is familiar with the site specific conditions, which are important to the successful implementation of the remedial activities. At this time the Administrator does not believe the total remedial action costs will exceed $300,000, although the approved budget when combined with previous costs reimbursed would put the total project cost close to the $300,000 remedial benefits cap.

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved the $227,500 in remedial action costs and waiver of the two (2) bid requirement by a vote of 6-0.

  Mr. Polak stated that since Mr. McCarthy was now in attendance, he would move back on the agenda, beginning with the approval of the December 4, 2013 Council minutes.

 

PRELIMINARY BUSINESS

 

The minutes from the December 4, 2013 Council meeting were reviewed. On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved the minutes by a vote of 6-0.

  OPERATIONAL ISSUES
  A.

Review of January 1, 2014 Operator Training for Perc Drycleaners:

   

Mr. Eriksen reviewed with the Council the online training that was developed by the Illinois EPA in conjunction with the Administrator’s staff to meet the requirements of Public Act 097-1057. The training consists of 45 screens and should take approximately 30-45 minutes to complete. The slides are timed to prevent individuals advancing through the presentation without reviewing the content. At the end of the training is a short quiz. The initial course material was taken from a presentation put together by members of the State Coalition for Remediation of Drycleaners (SCRD) of which Illinois is a member. Mr. Eriksen played an active role in the development of this presentation for SCRD in 2007.

The presentation was reviewed with industry representatives on October 16, 2013 and their suggestions for modifications to the presentation were incorporated in the final course. The training course currently resides on the Council’s web site and is available in both English and Korean. In addition, the compliance programs may request a copy of the course material and present it to their members. This has been done twice by the National Drycleaner Institute (NDI).

Since the training’s online launch on December 16, 2013, approximately 244 drycleaners have completed the online training and another 95 have participated in the training via two (2) seminars hosted by NDI.

Mr. Eriksen noted Public Act 097-1057requires that the Council approve the content. He stated it was his oversight and this issue should have been included on the December 4, 2013 Council meeting agenda for approval even though the training was not 100% complete as of that date. The Illinois Environmental Protection Agency (IEPA) took the lead in developing the format and the associated best management practices and the Administrator’s staff played a supporting role in getting the course completed and up and running prior to the January 1, 2014 training deadline.

After a brief discussion by the Council, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council approved the online Environmental Best Management Practices For Perc Drycleaners by a vote of 6-0.

  B.

Report on and Proposed Modification to Compliance Program Requirements:

   

Mr. Eriksen noted at the Council’s August 21, 2013 annual Strategic Planning meeting, the Administrator outlined four (4) proposed modifications to the compliance program policies and procedures. Proposed modifications one (1) and two (2) were adopted by the Council at that meeting. Modifications three (3) and four (4), discussed at the August 21, 2013 Council meeting, were deferred until the Administrator could meet with the compliance programs and get input from them. The following is a discussion of the proposed modifications and feedback received from the compliance programs per their meeting on October 16, 2013:

   
i. Compliance Program Certificate – Effective Period
 

Mr. Eriksen noted the Council currently allows a compliance program certificate to be issued for no longer than a two (2) year period. The compliance programs have the ability to issue annual certificates if they so choose, which is what most compliance programs have opted to do.

The Administrator had suggested as a proposed modification for the compliance program certificate to be issued for a four (4) year period that would expire on September 30th. At the October 16, 2013 compliance/ industry meeting, the compliance programs in attendance requested they be allowed to continue to issue an annual compliance program certificate and use December 31st as the certificate expiration date.

Based on discussion with the compliance programs and industry representatives, the Administrator recommends the compliance program certificate be issued for no longer than a four (4) year period and no shorter than annually. In addition, the Administrator recommends that all certificates issued after March 31, 2014 expire on December 31st.

After discussion by the Council, on a motion by Mr. Kwak and a second by Mr. Bredenkamp, the Council approved the Administrator’s recommendation that a compliance program certificate be issued for no longer than a four (4) year period and no shorter than annually and that all certificates issued after March 31, 2014 expire on December 31st by a vote of 6-0.
ii.

Perc Operator Training (i.e. Environmental Best Management Practices for Drycleaners) Completion – Maintaining Fund Insurance Coverage and Ownership Change

 

Currently all operators of perc drycleaning machines are required by statute to have completed the online training by January 1, 2014. As discussed at the Council’s December 4, 2013 Council meeting, it was understood by the Illinois EPA and the Administrator’s staff that the January 1, 2014 date was not a realistic date for all operators to complete such training due to the short time period the training was available. In addition, the Council at their August 21, 2013 meeting, modified the policies and procedures to require all drycleaners who have financial responsibility (insurance) coverage with the Fund, complete the Perc Operator Training course to maintain coverage with the Fund.

Mr. Eriksen noted the Administrator is proposing the following policy and procedure modifications related to the Perc Operator Training requirement as it applies to a drycleaning facility insured by the Fund:
  1. That all current Fund insured drycleaner operators complete the Perc Operator Training by June 30, 2014.  Failure to complete the training by June 30, 2014 will result in issuance of a 60-day cancellation notice by the Administrator to complete the training within the 60-day notice period.
  2. When an ownership of a drycleaning facility changes, the new owner must complete the Perc Operator Training by April 30th of the year subsequent to the ownership change. Failure to complete the training by April 30th will result in issuance of a 60-day cancellation notice by the Administrator to complete the training within the 60-day notice period.
 

It is the Administrator’s recommendation that both of these modifications be implemented effective immediately.

Mr. Kwak initiated a lengthy discussion as to the necessity of all Fund insureds completing the online perc operator training course and also commented on the proposed change in the site inspection frequency for the compliance programs from once every two (2) years to once every four (4) years, with the Administrator having the authority to inspect facilities as often as once every four (4) years. The ensuing discussion focused on the cost of the compliance program inspections versus those completed by the Fund and whether this format would result in enhanced pollution prevention practices or not.

Mr. Bredenkamp noted it was his recommendation the Council allow the modifications adopted at the August 21, 2013 Council meeting a chance to be implemented to see if they were effective. If time shows they are ineffective, the Council could review them at a later date.

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved, by a vote of 6-0, that all Fund insureds complete the perc operator training course by June 30, 2014. Failure to complete it by that date would result in issuance of a 60-day Cancellation Notice to complete the course.

On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 6-0 that when an ownership of a drycleaning facility change occurs, the new owner must complete the perc operator training by April 30th of the year subsequent to the ownership change. Failure to do so would result in the issuance of a 60-day Cancellation Notice to complete such training.

iii.

Revisions to Site Inspection Form

  Mr. Eriksen noted the Council had previously agreed that the Administrator and the compliance programs should meet and discuss modifications to the Council’s required compliance program site inspection form to make certain that it clearly addresses all site inspection program requirements. Attached for the Council’s review and approval is the modified site inspection form based upon comments received from the compliance programs at the October 16, 2013 meeting and the Council’s August 21, 2013 modifications to the compliance program policies and procedures. Mr. Eriksen reviewed the modifications with the Council noting the substantial changes to page 6, which defines the specific photographs that are required at each Council inspection.
 

On a motion by Mr. Lewicki and a second by Mr. Young B. Kim, the Council‘s revised Site Inspection Form was approved by a vote of 6-0.

  C.

Update on Drycleaner Fund Task Force:

    Mr. Eriksen reported that the state legislators have made their appointments to the Drycleaner Trust Fund Task Force and the only remaining appointments are those to be made by the Governor’s office. It was his understanding the task force appointments would be completed in the near future and that the initial task force meeting would happen sometime in late April or early May of this year.
  D.

Legislative Update:

   

Enclosed in the Council packet was a copy of HB4322, which was sponsored by Rep. Michael Zalewski. The bill contains the legislative issues the Council approved at their August 21, 2013 Strategic Planning meeting.

The Governor had requested the Council defer seeking legislative approval of the bill until such time as the Drycleaner Trust Fund Task Force could complete their review of the program. Mr. Eriksen noted six (6) of the seven (7) individual Council members had agreed to the Governor’s request and that he had communicated to Rep. Zalewski that the Council wished to table the bill at this time.

  OTHER ISSUES AS PRESENTED
 

The next Council meeting is tentatively scheduled for Wednesday, April 23, 2014. The Council members in attendance indicated that at this time the meeting date was acceptable.

Per Mr. Kang’s request, Mr. Eriksen read an email that he had received that morning from Mr. Kang regarding inquires he had made of the Administrator and Mr. McCarthy as to policies and procedures related to adding items to the Council’s agenda and the status of specific action items taken by the Council in the past.

Mr. Polak noted it was unfortunate that Mr. Kang had decided not to attend this meeting but that was his prerogative. Mr. Eriksen replied that Mr. McCarthy and he would reach out to Mr. Kang and try to meet with him to discuss, clarify and further try to understand his issues and concerns.

  PUBLIC COMMENT PERIOD
 

Mr. Joel Lockwell, vice president of CD One Price Cleaners, made some general comments regarding the compliance program site inspections and the Council’s approval of claim costs..

  CLOSED SESSION
 

Mr. Polak noted there were matters for discussion involving potential litigation for discussion by the Council in Closed Session. On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 6-0 to go into Closed Session at 12:43 p.m.

The Council returned from Closed Session at 12:46 p.m. On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 6-0 to settle the 2013 license late payment fee on Shore Cleaners, Site #0002417 in Chicago, IL for $300.

There being no further business, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 6-0 to adjourn the meeting at 12:50 p.m.

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