June 7, 2012 Meeting Minutes

  MINUTES
 

DRYCLEANER ENVIRONMENTAL RESPONSE TRUST FUND
COUNCIL of ILLINOIS

CHICAGO MARRIOTT/NAPERVILLE
NAPERVILLE, ILLINOIS

JUNE 7, 2012

John Polak, Chairperson, called the Drycleaner Environmental Response Trust Fund Council of Illinois meeting to order at 10:08 a.m. A quorum was present. Roll call was taken with the following members present:

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

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

Yong Kim, Program Administrator’s Office

PRELIMINARY BUSINESS

The minutes from the April 5, 2012 Council meeting were reviewed. On a motion by Mr. Lewicki and a second by Mr. Kim, the minutes were approved by a vote of 6-0.

  OPERATIONAL ISSUES
  A.

Interstate Chemical Company, Hermitage, PA:

   

Mr. Eriksen provided background information to the Council noting that Interstate Chemical Company, headquartered in Hermitage, PA, was assessed a civil penalty of $500 on January 12, 2012 by the Administrator for delivering solvent to an unlicensed drycleaner in January 2011, prior to the drycleaning facility being licensed by the Fund. On February 17, 2012, Interstate Chemical Company appealed the civil penalty of $500 to the Council. Mr. Tom Beatty, representing Interstate Chemical Company, participated in the appeal via telephonic conference. He noted Interstate Chemical Company had only one (1) customer in Illinois and they were not aware the drycleaning facility was not licensed. Interstate Chemical Company had previously acquired Coleman Chemical Company, which is where previous notices regarding the licensing requirements had been sent. Interstate Chemical Company has implemented procedures to prevent such an occurrence in the future.

After discussion by the Council, on a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted 6-0 to deny waiver of the $500 civil penalty assessment to Interstate Chemical Company for delivering solvent to an unlicensed drycleaner.

  B.

Quality Cleaning Fluids, Franklin Park, IL:

   

Mr. Eriksen reviewed background information with the Council noting that Quality Cleaning Fluids, headquartered in Franklin Park, IL, was assessed a civil penalty of $500 on January 30, 2012 by the Administrator for delivering solvent to an unlicensed drycleaner in January 2011, prior to the facility being licensed. On March 2, 2012, Quality Cleaning Fluids appealed the civil penalty of $500 to the Council. Ms. Doris Dellegarzie, president of Quality Cleaning Fluids, addressed the Council. She provided background information on Quality Cleaning Fluids to the Council, noting the drycleaner had shown a copy of his DS-3 license fee payment receipt of $2,250 to the truck driver who delivered the solvent. Ms. Dellegarzie stated the civil penalty was punitive and the Council should have issued a drycleaning license prior to the delivery date, as they had received a majority of the necessary licensing information by early January.

The Council conducted a discussion regarding waiver of the $500 civil penalty. Mr. McCarthy noted that if the Council granted the appeal, they are going down a “slippery slope” as the solvent distributor had three (3) different means to determine if the facility was licensed. Those being they could actually view the license at the time of the delivery, they could go to the Trust Fund web site and determine if the drycleaner was on the list of licensed drycleaners or they could call the Fund and confirm the drycleaner had a current license. Based on evidence presented, it appears Quality Cleaning Fluids failed to confirm the licensure status for the facility using one of those three (3) means.

Mr. Polak asked if the Council ignores the licensing requirement and the verification process, how does the Council address future appeals and the criteria for assessing the penalty? After additional discussion, on a motion by Mr. Bredenkamp and a second by Mr. Kwon, the Council voted 5-1 to deny waiver of the $500 civil penalty assessed to Quality Cleaning Fluids for delivering solvent to an unlicensed drycleaner.

  OPERATIONAL ISSUES
  A.

Legislation Update:

   

Mr. Eriksen reviewed with the Council that HB4526: EPA-Perchloroethylene Ban was amended on May 3, 2012. Key provisions of the amendment are:

1. Clarifies that required operator training relates only to drycleaning machines using perchloroethylene.
2. Training involving best management practices, etc., as approved by the Drycleaner Environmental Response Trust Fund Council as compliance program CEU credits can be applied towards meeting the operator training requirement of the bill.
3. Amends the licensing requirement of the Illinois Drycleaner Environmental Response Trust Fund Act. Specifically, it requires that license renewal application forms after January 1, 2013 must include a certification by the applicant that all hazardous waste stored at the drycleaning facility is stored in accordance with all applicable federal and state laws and regulations and that all hazardous waste transported from the drycleaning facility is transported in accordance with all applicable federal and state laws and regulations. The drycleaner must include copies of all manifests for hazardous waste transported from the drycleaning facility during the previous 12 months or since the last submission of copies of manifests, whichever is longer. After a three (3) year period, if the Council has not received a copy of the waste manifest for a drycleaning facility, they shall make appropriate inquiry into the management of the hazardous waste at the facility and may share the results of the inquiry with the Illinois EPA.
  The bill passed the House and the Senate on May 30, 2012 and included the amendments listed above. The Senate vote was 53-6-0 and the House vote was 102-15-0.

No other legislation specifically modifying the Illinois Trust Fund Act was passed by the legislature during the 2012 spring legislative session.

  B. Review of Draft Report - April 5, 2012 Audit of Individual Compliance Programs:
   

Mr. Polak summarized the report and noted the key issue to consider is what progress programs have made in meeting the requirements for administering a compliance program as defined by the Council. This year’s audit included two (2) additional categories, the first being new inspection photographs for each inspection and second, the requirement of original signature on documents. It was his overall sense that two (2) programs did not improve as much as the other programs in the overall. He stated the biggest issue for Council consideration is what to do with the two (2) programs that still had substantial non-compliance in several areas. It was his recommendation that at the Strategic Planning Session to be held in late August that the Council looks at what means are needed to address how to bring these programs in to compliance with the requirements established by the Council. Mr. Eriksen noted the Administrator is recommending the Council consider auditing both the NDI and the Asian-American Small Business Association compliance programs in the first quarter of calendar year 2013 to see if further progress has been made in coming into compliance with the Council’s requirements.

  C.

Legal Representation:

   

Mr. Eriksen noted that Mr. John McCarthy’s fiscal year 2012 contract with the Council for provision of legal services expires June 30, 2012. His contract was a one (1) year contract for total costs not to exceed $19,999. To date, the Council has paid Mr. McCarthy $17,379.74.

Mr. Eriksen stated it is his recommendation the Council enter into a contract with Mr. McCarthy to provide legal services to the Council for fiscal year 2013, for a cost not to exceed $19,999. Mr. McCarthy currently charges the Fund $170 per hour for professional services and $100 per hour for travel time. Mr. McCarthy is requesting his rates remain the same for 2012.

On a motion by Mr. Bredenkamp and a second by Mr. Kim, the proposed contract and hourly rates were approved by a vote of 6-0.

  D.

Administrative Law Judge Contract:

   

Mr. Iain D. Johnston’s fiscal year 2012 contract to provide Administrative Law Judge services to the Council expires June 30, 2012. His contracted hourly rate is $265 per hour and his contract was a one (1) year contract for total costs not to exceed $19,999. To date, the Council has paid Mr. Johnston $7,844.50.

It is the Administrator’s recommendation that the Council enter into a new contract with Mr. Johnston at the same hourly rate for fiscal year 2013. The total amount of the contract shall not exceed $19,999.

On a motion by Mr. Bredenkamp and a second by Mr. Kwon, the Council approved the fiscal year 2013 contract for an amount not to exceed $19,999 at a professional hourly rate of $265 per hour. The motion passed by a vote of 6-0.

  E.

Update on Industry Meeting – Extension of Fund Sunset Date:

   

Mr. Eriksen provided a brief update regarding the industry meeting held June 6, 2012 in Des Plaines, IL. At that meeting, industry representatives looked at two (2) additional financial projection scenarios. A consensus has not been reached by the industry representatives on what plan of action should be recommended to the Council to address the projected deficit of over $10 million as of the Fund’s sunset date of January 1, 2012. He noted most of the representatives were in agreement on a plan of action but one (1) organization needs to discuss further the potential options with their leadership group at the end of June.

Mr. Eriksen stated this topic will be on the agenda for further discussion at the August Strategic Planning Session.

  F.

Topics for Strategic Planning Meeting:

   

Mr. Eriksen reviewed the outline of tentatively identified issues for discussion at the Strategic Planning meeting, noting Fund solvency continues to be a key priority of the Council. The meeting is tentatively scheduled for Wednesday, August 29, 2012. Council members present indicated that at this time they did not have a conflict with that date. Mr. Polak recommended the Administrator meet with representatives of the Illinois EPA to discuss policies and procedures the Council would need to enact to implement HB4526.

  APPROVAL OF PROGRAM BILLINGS
 

Mr. Eriksen stated there were four (4) invoices before the Council for their review and action; three (3) were included in the Council packet. They were as follows:

  1. Williams & Company Consulting, Inc $65,095.00
    Standard flat fee billing for April 2012, licensing, underwriting, claims processing and site inspections.  
  2. John J. McCarthy  $2,300.00
    Professional legal services to the Council for the period of March 25, 2012 through May 17, 2012.  
  3. Johnston, Greene, LLC $927.50
    Professional legal services as Administrative Law Judge for March 2012.  
 

Mr. Eriksen stated he had distributed via email one (1) additional bill, which was:

  4. Williams & Company Consulting, Inc $50,498.00
    Standard flat fee billing for May 2012, licensing, underwriting, claims processing and site inspections.  

On a motion by Mr. Bredenkamp and a second by Mr. Kwak, the Council approved the bills as presented by a vote of 6-0.

  REVIEW OF ACTIVITY REPORT AND FINANCIAL STATEMENTS
 

Mr. Eriksen noted that as of the end of April 2012, there were 952 licensed drycleaners. As of June 1, 2012, there were 971 as compared to 1,045 as of June 1, 2011. Forty-four (44) applications are currently pending review and additional information, making total potential licensees of 1,015 as of June 1, 2012.  

Open remedial claims totaled 251, with estimated cleanup reserves of $28.6 million. Five hundred thirty-three (533) drycleaning facilities are insured with the Fund.

The Fund balance as of April 30, 2012 was $2,524,435; year-to-date remedial claim payments total $1,995,094.

CLAIM PAYMENTS IN EXCESS OF $75,000

Mr. Eriksen noted there were five (5) claim payment requests in excess of $75,000 requiring Council review and action. Four (4) were included in the Council packet and one (1) was completed subsequent to the packet and was a carry-in for today’s meeting.

  A.

L-Nor Cleaners, Mount Prospect, IL; Claim #50358; Site #0001299:

   

Mr. Eriksen reviewed background information with the Council noting remediation will be required at this facility. Prior to developing a remedial action plan, the consultant is needing to re-sample soil and groundwater at the site to determine current site conditions as previous soil and groundwater samples were last collected in 2003 and 2004. The proposed cost to do the additional site investigation work is $15,000, including a 20% contingency. In addition, the Administrator is requesting Council waive the two (2) bid requirement for consulting services due to the extensive knowledge the consultant has of the site conditions at the facility.

On a motion by Mr. Lewicki and a second by Mr. Kim, the budget request of $15,000 was approved as well as waiver of the two (2) bid requirement for consulting services by the Council by a vote of 6-0.

  B.

Concord Custom Cleaners #082 , Springfield, IL; Claim #50631;
Site #0001122:

   

Mr. Eriksen reviewed background information with the Council noting that remediation utilizing in-situ chemical oxidation was performed at the facility in 2005. Additional remediation will be necessary to reduce the contaminate levels at the site. However, the consultant believes that sufficient biological activity is occurring that continues to reduce the levels of contaminants at the site and has requested cost approval to complete two (2) additional sampling events to determine if this reduction is taking place. The proposed budget request is $8,250 to conduct four (4) quarterly groundwater monitoring events at the site.

On a motion by Mr. Kim and a second by Mr. Lewicki, the $8,250 budget request was approved by the Council by a vote of 6-0.

  C.

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

   

Mr. Eriksen noted that remediation has been completed at this drycleaning facility and the Administrator is requesting budget approval of $11,560 for costs related to provide a closure plan, obtain a groundwater ordinance and complete a Remedial Action Completion Report (RACR).

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the $11,560 in requested costs were approved by the Council by a vote of 6-0.

  D. New Poly Cleaners, Oak Park, IL; Claim #50224, Site #0001931:
   

Mr. Eriksen reviewed background information with the Council noting this facility had minimal site investigation work done at the facility in 2006 but a high level of soil contamination was discovered during that initial site investigation activity. No additional investigation activities have been conducted since then due the low priority ranking score.

Due to the severity of contamination and proximity between the hotspot and the property line, the remedial activity is expected to be costly despite the fact that a full groundwater ordinance exists in Oak Park, IL. In April 2012, the Council released funding for M K Cleaners in Chicago, IL for a full site investigation to be used for a pilot test design utilizing new remedial technologies. During the subsequent  onsite meeting with representatives of Pure Enviro Management (PEM), they indicated  they would like to try their technology at two (2) facilities, and specifically this one, as the clay soil is not as tight as that at M K Cleaners and there is a relatively large working space and high ceiling inside the facility to facilitate installation of the remedial system. The Administrator noted the fund will not pay for pilot test costs until the outcome of the pilot study meets remediation objectives and is not requesting approval of any pilot test costs at this time.

The Administrator is requesting $44,130 for site investigation costs, with additional contingency costs of $20,000, for a total of $64,130 to definitively define the contamination at the drycleaning facility in order for PEM to develop and implement a pilot remedial test project at the facility.

On a motion by Mr. Kim and a second by Mr. Bredenkamp, the budget request of $64,130 was approved by the Council by a vote of 6-0.
 

Mr. Eriksen stated he had a carry-in request for the following facility:

  E.

Wilmette Tailors & Cleaners, Wilmette, IL; Claim #50128, Site #0001622:

   

Mr. Eriksen reviewed background information with the Council noting that extensive site investigation work has been conducted at the facility and that remedial action will be necessary in order to get an NFR letter for the facility. A Remedial Action Plan (RAP) has been completed by the consultant and the proposed remedial technology is chemical oxidation using Regenox via a slow feed delivery system. The proposed cost to implement this system is $85,500, which includes a 20% contingency. In addition, the Administrator is requesting the Council waive the two (2) bid requirement for environmental consulting services, as the current consultant has conducted extensive site investigation activities at the facility and is familiar with the site specific conditions.

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved the $85,500 in requested costs and waiver of the two (2) bid requirement by a vote of 6-0.
  OTHER ISSUES AS PRESENTED
 

Mr. Eriksen provided an update as to the LOGIC training requested by the Governor’s Office for all state agencies. The training focused on performance-based budgeting and the completed report is due to the Governor’s Office in October of this year.

Mr. Eriksen reminded the Council that they needed to complete new reimbursement forms if they wanted their travel expense check direct deposited.
  PUBLIC COMMENT PERIOD
 

Mr. Polak asked if there were any comments from the public. Mr. Sung Kang, representing NDI, stated he would like a list of missing documents from the NDI audit and a copy of the letter where NDI was found to not be in compliance with the requirements. Mr. Eriksen stated a summary of the deficiencies was noted in the report. Mr. Kang commented there should be a simpler way to license drycleaning facilities. He referenced rising perc prices and it had been suggested to him that this may be due to the Council’s requirements they place on solvent distributors in order to verify that drycleaners are properly licensed. Ms. Heather Kim, representing KC Supply, noted they have seen perc prices increase since 2010 but was they are uncertain as to what factors are causing the increased prices. Mr. Eriksen noted that a recent article in one of the drycleaning publications noted there are only two (2) major manufacturers of perc left and the reduced usage by the drycleaning industry has caused the cost to increase, i.e., a direct relationship between supply and demand. Mr. Polak reaffirmed that the cost discussion was not relevant as the price is being set by the manufacturers. The Council has not made in changes in their regulations in the past several years that should impact the price of perc nor is he aware of any environmental regulations implemented on a federal or state level that should impact the price.

  CLOSED SESSION
 

Mr. Eriksen noted there were matters of potential litigation requiring Council review and action in Closed Session. On a motion by Mr. Polak and a second by Mr. Kwak, the Council voted 6-0 to go in to Closed Session at 11:56 am.

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp the Council voted 6-0 to go out of Closed Session and back in to Open Session at 12:20 pm.

On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted  to settle all outstanding license fees for OK Cleaners in Naperville, IL in the amount of $5,000. The motion passed by a vote of 6-0.

On a motion by Mr. Bredenkamp and a second by Mr. Kwon, the Council voted to allow Monaghan Corporation to pay their civil penalties in monthly installments of $5,000. The motion passed by a vote of 6-0.

There being no further business, on a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council meeting adjourned at 12:25 pm.

   
  Back to Top