April 6, 2011 Meeting Minutes

  MINUTES
 

DRYCLEANER ENVIRONMENTAL RESPONSE TRUST FUND
COUNCIL of ILLINOIS

WYNDHAM HOTEL LISLE/CHICAGO
LISLE, ILLINOIS

APRIL 6, 2011

John Polak, Chairperson, called the Drycleaner Environmental Response Trust Fund Council of Illinois meeting to order at 10:06 a.m. A quorum was present. Roll call was taken with the following members present:

John Bredenkamp
Young B. Kim
Charles Kwon (arrived at 10:10 a.m.)
Jerry Lewicki
John Polak

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

Randy Jackson, Program Administrator's Office
Yong Kim, Program Administrator's Office

PRELIMINARY BUSINESS

The minutes from the February 23, 2011 Council meeting were reviewed. On a motion by Mr. Bredenkamp and a second by Mr. Kim, the minutes were approved by a vote of 4-0.

  APPEAL OF LICENSE LATE PAYMENT FEES
  Site #0001385-New Simon Cleaners, 1167 W Park Ave, Libertyville, IL
 

Mr. Eriksen reviewed background information with the Council regarding New Simon Cleaners located at 1167 W Park Avenue in Libertyville, IL.

On December 24, 2010, Mr. Sang W Kwon paid $1,500 towards his 2011 license fee. In licensing New Simon Cleaners for 2011, the Administrator’s staff noted Mr. Kwon had purchased 54.2 gallons of perchloroethylene drycleaning solvent, placing him in the license fee category of $2,250. Mr. Kwon was billed the additional $750 in license fees. He appealed the additional license fee to the Council on March 3, 2011, noting that on November 23, 2010, he did not receive 10 gallons of perchloroethylene from Tri-Supply Company as indicated on the invoice, but only received 5 gallons. He refused to pay Tri-Supply the full amount of the bill for 10 gallons of solvent, noting it was not the correct amount. The Administrator contacted Tri-Supply, who confirmed in writing they delivered 10 gallons of solvent to Mr. Kwon but he refuses to pay for the solvent. Tri-Supply provided the Fund with an accounts receivable aging, noting the invoice for 5 gallons of solvent is still outstanding.

Mr. Kwon addressed the Council stating he had ordered 10 gallons of perchloroethylene from Tri-Supply Company. They delivered the solvent in 20-gallon containers, but the pump gauge was broken and in viewing the container, did not believe he had received the 10 gallons of solvent based on looking at the sight glass in the solvent tank of his drycleaning machine.

Mr. Charles Kwon arrived at the Council meeting at 10:10 a.m.

Mr. Polak referenced that based on past licensing history, Mr. Kwon has managed to limit his purchase of solvent each year to 50 gallons or less.

After additional discussion by the Council, on a motion by Mr. Lewicki and a second by Mr. Kim, the Council agreed that New Simon Cleaners license fee for 2011 should be set at $1,500. The motion passed by a vote of 5-0.

  CONTINUED APPEAL OF 2010 LICENSE LATE PAYMENT FEE
  Site #0001089-Golden Hanger Cleaners, 589 Roosevelt Rd, Glen Ellyn, IL
 

Mr. Eriksen noted that this is a continuation of an appeal the Council initially heard at their January 12, 2011 Council meeting. Mr. Eriksen reviewed information that Mr. Young S Kong, drycleaning facility owner/operator, had previously provided the Council and referenced Mr. Kong’s statements from the January meeting that the boiler had broken down and was inoperable as of December 2009, and his statement that an insurance claim had been filed to repair the boiler and he had invoices substantiating the clothing he had taken in at his facility and sent to other drycleaners for drycleaning for the period of December 2009 through March 20, 2010.

Mr. Eriksen reviewed the additional information Mr. Kong submitted to the Fund, including an invoice stating that boiler repair was conducted on August 29, 2009, and an affidavit from Mr. Bang Oh Ahn, which states he is the owner of Park Avenue Cleaners in Glen Ellyn, IL, and that he provided drycleaning and laundry services from December 26, 2009 to February 12, 2010 for Golden Hanger Cleaners. Based on the review of this information, Mr. Eriksen requested copies of all cancelled checks made payable to Park Avenue Cleaners for drycleaning services they provided to Golden Hanger Cleaners for the period noted above. Mr. Eriksen requested the cancelled checks because Mr. Bang Oh Ahn was not the owner/operator of Park Avenue Cleaners during the period of December 26, 2009 to February 12, 2010. Mr. Ahn did not acquire ownership of Park Avenue Cleaners until August 1, 2010.

Mr. Kong was not present to provide any additional testimony or information to the Council.

After additional discussion, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 5-0 to deny Mr. Kong’s request to have his 2010 license fee refunded in the amount of $1,500.

  APPEAL OF CIVIL PENALTY FOR DELIVERING SOLVENT TO AN UNLICENSED DRYCLEANER
  1. Wausau Chemical Corporation, Wausau, IL  
   

Mr. Eriksen reviewed background information with the Council noting that effective January 1, 2010, the Council had the authority to assess a civil penalty not to exceed $500 for the first violation and a civil penalty not to exceed $5,000 for a second or subsequent violation against any person who sells or transfers drycleaning solvent to an operator of a drycleaning facility that is not licensed by the Council.

Mr. Eriksen reviewed information that was sent to the drycleaning distributor regarding the notification requirements and the need to verify that all drycleaners are licensed prior to delivering drycleaning solvent.

Wausau Chemical Corp. was assessed a civil penalty of $500 on February 16, 2011 for delivering solvent to an unlicensed drycleaner in January 2010, prior to the facility being licensed. On February 25, 2011, Wausau Chemical Corp. paid the civil penalty of $500 to the Fund and appealed the civil penalty to the Council.

Mr. Kevin Braden of Wausau Chemical Corp. was in attendance and addressed the Council. He stated Wausau Chemical Corp. understood the rules and had obeyed the regulations and this incident involved a long-time drycleaner customer of the company. They had a good working relationship and the drycleaner had indicated he had been issued a license for 2010. Mr. Braden stated Wausau Chemical Corp. took him at his word, that it was a clerical error, and that it was not the intent of Wausau Chemical Corp. to attempt to infringe on the regulations and therefore they were requesting leniency since this was their initial violation. Mr. Braden noted that at the first of each year they clear out all licensed drycleaners from their database and then manually enter in the new licenses based on those posted to the Fund website. If they go fill an order, a flag comes up if the drycleaning facility is not licensed. Mr. Braden indicated it is not the responsibility of the delivery driver to check to make certain there is a current license.

The Council conducted a general discussion regarding the validation process, with Mr. Polak noting that it could be done via three (3) ways:
1.  via the Fund’s web site;
2.  via a telephone call to the Administrator’s staff; or
3
.  via a physical review of the current year drycleaning license.

It was clarified that the second and all subsequent violations, based on the Council’s current policy, would be assessed at $5,000 per violation.

Mr. Kim made a motion to waive the $500 penalty for the initial violation but indicated he wanted to be on record that the second offense would be subject to a $5,000 penalty. Mr. McCarthy stated that such a motion was not legitimate and must be withdrawn, which Mr. Kim did.

After brief additional discussion, on a motion by Mr. Bredenkamp and a second by Mr. Kim, the Council voted 5-0 to deny waiver of the $500 civil penalty for delivery of drycleaning solvent to an unlicensed drycleaner. The motion passed by a vote of 5-0.

 
  2. EMCO Chemical Distributors, Inc., North Chicago, IL  
   

Mr. Eriksen provided background information to the Council noting that EMCO Chemical Distributors, Inc., headquartered in North Chicago, IL, was assessed civil penalties of $5,500 on March 2, 2011 by the Administrator for delivering solvent to an unlicensed drycleaner in January and June 2010 prior to the facility being licensed. On March 21, 2011, EMCO Chemical Distributors, Inc. appealed the civil penalties to the Council.

Ms. Terry Berry, Regulatory Affairs Director, and Ms. Vera Banks, Accounting Specialist, for EMCO Chemical Distributors, Inc., addressed the Council regarding EMCO’s appeal of $5,500 in civil penalties. Ms. Banks noted that EMCO has never been cited in the past for delivering solvent to an unlicensed drycleaner and stated EMCO had a policy in place up until 2010 in which they requested a copy of the current year license from the drycleaner prior to selling them solvent. In 2010, they printed the list of licensed drycleaners from the Fund’s web site and provided it to their Customer Service Department, and it was left to them to verify the drycleaner was licensed prior to selling them solvent. Ms. Banks indicated the drycleaner at which the two (2) violations occurred, was their only drycleaning solvent customer. They have since revamped their entire sales system, which allows them to be more proactive and minimizes the possibility of a future delivery to an unlicensed drycleaner.

Mr. Eriksen informed the Council the drycleaner had paid his license fee on April 15, 2010, but had not paid the license late payment fees until mid-June, which resulted in a drycleaning facility license not being issued until the license late payment fees had been paid.

After additional discussion by the Council, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 5-0 to deny the appeal waiving or reducing the $5,500 in assessed civil penalties for delivering solvent to an unlicensed drycleaner.

 
  OPERATIONAL ISSUES
  A.

Legislative Update:

   

Mr. Eriksen noted that SB1617, which would prohibit the installation or operation of drycleaning machines that use perchloroethylene after January 1, 2030, was passed by the Senate on March 31, 2011, by a vote of 52-0. The bill has now moved over to the House, where it will be assigned to a committee in the near future and debated by the House.

Regarding the Council’s proposed legislation (HB1953), the bill was voted out of the House Environmental Committee by a vote of 18-0 and is scheduled for a second reading in the House. Mr. Eriksen noted April 15th is the deadline for passage of all House bills. He will continue to keep the Council updated as to the status of proposed legislation.

  Mr. Polak recessed the Council meeting for a short break at 11:20 a.m. The Council reconvened at 11:27 a.m.
  B. Presentation on Remedial Technologies:
   

Dr. Juho So and Mr. Randy Jackson of the Administrator’s staff presented a slide show on remedial technologies being used for cleanup of sub-surface drycleaning solvent contamination in Illinois. The Council expressed their appreciation for the presentation and the updated information it provided them.

  APPROVAL OF PROGRAM BILLINGS
 

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

  1. John J. McCarthy    $2,603.78  
    Professional legal services to the Council for the period of February 12, 2011 through March 25, 2011.
  2.  Williams & Company Consulting, Inc
$68,102.00  
 
    Standard flat fee billing for February 2011, licensing, underwriting, claims processing and site inspections.
  3. Iain D. Johnston
 $927.50
 
    Professional legal services as the Administrative Hearing Officer for the month of February 2011.
 

Mr. Eriksen stated he had one (1) carry in bill for the Council’s review:

  4. Williams & Company Consulting, Inc
$74,101.00  
 
    Standard flat fee billing for March 2011, licensing, underwriting, claims processing and site inspections.  
 

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.

  REVIEW OF ACTIVITY REPORT AND FINANCIAL STATEMENTS
 

Mr. Eriksen reviewed with the Council the February 2011 monthly activity report noting that 872 facilities had been licensed for 2011 as of February 28, 2011 and as of April 4, 2011, 966 facilities are licensed. As of February 28, 2011, 554 facilities have pollution liability insurance coverage with the Fund and 275 remedial claims were open with estimated reserves of $31 million. Mr. Eriksen reviewed the graph of No Further Remediation (NFR) letters issued by year dating back to 2002.

Mr. Eriksen noted the Fund balance as of February 28, 2011 was $4,800,365. Mr. Eriksen reported there was a transfer on March 21, 2011 from the Fund to the State’s General Revenue Fund in the amount of $948,100. This transfer was done in accordance with legislation passed during the 2010 legislative session, which stated this money must be repaid within 18 months with interest. He has been in contact with the Office of Management and Budget explaining the Council may need some of that money in fiscal year 2012 in order to pay for budgets that have been approved on claims released for funding. Mr. Eriksen stated he would continue to monitor the Fund transfer.

  CLAIM PAYMENTS IN EXCESS OF $75,000
 

Mr. Eriksen noted there were four (4) claims in excess of $75,000 requiring Council review and approval. These claim requests would be reviewed with the Council by Dr. Juho So and Mr. Randy Jackson.

  A. Spring Cleaners, Western Springs, IL - Claim #50504, Site #0002436:
   

Dr. So reviewed background information with the Council noting that remediation conducted at the facility has been moderately successful in reducing the contamination levels but further remediation is required at the facility. He reviewed with the Council reasons why the initial remedial activities were not totally successful. The Administrator is requesting $75,000 in additional remedial costs to complete the cleanup

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved the Administrator’s budget request for additional remediation by a vote of 5-0.

  B. Johnny on the Spot Cleaners, Freeport, IL - Claim #50775, Site #0001268:
   

Mr. Jackson addressed the Council noting the Administrator is seeking budget approval for $80,000 in monitoring and drinking well abandonment and water line installation costs.

Mr. Jackson reviewed background information with the Council noting that substantial site investigations have been conducted at the facility in order delineate on and off-site soil and groundwater contamination. The conclusion of these investigations was that active remediation was not necessary as the soils at the site did not exceed the default Csat limit and the City of Freeport has a groundwater ordinance. However, numerous existing private wells remain open at the facility and several of them are being used. In order to obtain a No Further Remediation (NFR) letter, these wells must be closed and the water supply for several structures must be replaced with a municipal water supply, which includes the installation of lines from the City water mains.  

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved the $80,000 in additional monitoring well closure and installation of water lines to existing structures by a vote of 5-0.
  C. Ravinia 1 Hour Cleaners, Highland Park, IL - Claim #50547, Site #0001832:
   

Dr. So addressed the Council noting active remediation is required at the facility due to the high level of contamination in the soil and groundwater. The proposed remediation will be excavation with In-Situ Chemical Oxidation via Chemical Oxidant Retention Ponds (CORPs). The estimated cost including $40,000 for contingency is $130,000. Dr. So indicated the extent of the contamination has been well defined.

On a motion by Mr. Kim and a second by Mr. Lewicki, the Council approved $130,000 in cleanup costs, by a vote of 5-0.

  D. Barrington Elegance Cleaners, Barrington, IL - Claim #50042, Site #0001036:
   

Dr. So reviewed background information with the Council noting active remediation is required at the facility due to the high level of contamination in the soil and groundwater. The consultant is currently in the process of obtaining a groundwater ordinance at the facility. Active remediation is required to reduce the soil contamination to at or below the Csat level. The proposed scope of remediation method is In-Situ Chemical Oxidation via Chemical Oxidant Retention Ponds (CORPs). The Administrator is requesting $180,000 in remediation costs, which includes $30,000 of contingency costs.

On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council approved the budget request for a total of $180,000 in remedial action costs by a vote of 5-0.
  OTHER ISSUES AS PRESENTED
 

Mr. Eriksen stated the next Council meeting is tentatively scheduled for Wednesday, May 18, 2011.

Mr. Eriksen noted the field audit work for the fiscal year 2010 audit had been completed. He expects to receive a draft audit report in the near future for review. In addition, he reported both the House and Senate Appropriation Committee hearings for the fiscal 2012 appropriation request for the Trust Fund were held March 9, 2011.

  PUBLIC COMMENT PERIOD
 

Mr. Polak asked if there were any comments from the public. There were none.

Mr. Polak noted there were matters involving litigation needing discussion in Closed Session. On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council voted 5-0 to go into Closed Session at 12:40 p.m. The Council adjourned from Closed Session at 12:50 p.m. and went back in to Open Session.

Regarding the settlement of outstanding license and late payment fees for Olney Cleaners, located in Olney, IL, on a motion by Mr. Lewicki and a second by Mr. Kwon, the Council voted 5-0 to settle all past due license and license and late payment fees for a total of $13,500, whereby the drycleaner would pay $150 per month until the past license and license late payment fees are paid in full.

Regarding MK Cleaners, on a motion by Mr. Lewicki and a second by Mr. Kwon, the Council voted 5-0 to settle the 2010 and 2011 license late payment fees for $500. In addition, the drycleaner would pay the 2011 license fee in a single payment.

There being no further business, on a motion by Mr. Lewicki and a second by Mr. Bredenkamp, by a vote of 5-0, the Council meeting adjourned at 12:52 p.m.

   
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