OCTOBER 13, 2016 Meeting Minutes

 

MINUTES
DRYCLEANER ENVIRONMENTAL RESPONSE TRUST FUND
COUNCIL of ILLINOIS

CHICAGO MARRIOTT NAPERVILLE
NAPERVILLE, ILLINOIS

OCTOBER 13, 2016

 

John Polak, Chairperson, called the Drycleaner Environmental Response Trust Fund Council of Illinois meeting to order at 10:04 a.m. A quorum was present. Roll call was taken with the following members present:

 

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

Also present were:

H. Patrick Eriksen, Program Administratorís Office
John J. McCarthy, Program Counsel
Dr. Juho So, Program Administratorís Office
Yong Kim, Program Administratorís Office

  PRELIMINARY BUSINESS
 

The minutes from the August 25, 2016 Council meeting were reviewed. On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the minutes were approved by a vote of 7-0.

  OPERATIONAL ISSUES
  A. Status Update Ė NDI Appeal of Decertification
 

Mr. Eriksen referenced his memo included in the Council packet and noted Mr. Christopher Grant of the Attorney Generalís Office was in attendance to answer questions from the Council regarding the status hearings.

Mr. Grant reviewed Judge Flynn vacated the Councilís August 27, 2015 decision to decertify NDIís compliance program. Judge Grantís decision was based on lack of formal notice by the Council to NDI that the August 27, 2015 meeting was a decertification hearing. Judge Flynn said the Council can hold a decertification hearing with proper notice.

Mr. Bredenkamp made a motion for the Council to hold a formal decertification hearing of the NDI Compliance Program in accordance with Judge Flynnís guidelines. The motion was seconded by Mr. Lewicki.

Mr. Young Kim inquired if the Council would incur additional legal cost for a decertification hearing. Mr. McCarthy replied the Council could request Mr. Grant to represent them which would not result in any out-of-pocket legal costs for the Council. He noted other related expense should be minimal. A brief discussion of the potential legal costs associated with the decertification hearing ensured. Mr. Bredenkamp called for the question.

On a roll call vote, the motion passed 5-1-1 with Mr. Bredenkamp, Mr. Daniel Kim, Mr. Kwak, Mr. Lewicki and Mr. Polak voting in favor of the motion. Mr. Young Kim voted against the motion and Mr. Kang abstained.

Mr. Eriksen stated the second issue for Council consideration was whether they wished to request of the Attorney Generalís Office that Mr. Grant represent them at the decertification hearing. Mr. Polak commented Mr. Grant has considerable institutional knowledge on this topic.

Mr. Kwak commented the Council needs to review at the decertification hearing the information presented and discussed up to and at the August 27, 2015 meeting. He stated since Mr. Chung Nam was the chairman of NDI as of August 27, 2015 that he should attend and participate in the decertification hearing.

Mr. Daniel Kim asked what is considered to be an adequate notice period. The response was 30 days written notice is adequate.

On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, on a roll call vote, the Council voted 5-1-1 to request of the Attorney Generalís Office for Mr. Grant to represent the Council in the decertification hearing. Mr. Bredenkamp, Mr. Daniel Kim, Mr. Kwak, Mr. Lewicki and Mr. Polak voting in favor of the motion. Mr. Young Kim voted against the motion and Mr. Kang abstained.

  B. Proposed Modifications to Compliance Program Requirements
 

Mr. Eriksen updated the Council on the September 15, 2016 meeting with the five compliance programs and two industry associations. The September 15th meeting discussion focused on:

  • Suggested changes to the compliance program policies and procedures,
  • Modifications to the site inspection form,
  • Revised draft compliance program rules.
Based on the September 15th meeting, Mr. Eriksen proposed the following modifications to the Councilís compliance program policies and procedures:

1. Shorten the timeframe for compliance programs to submit site inspection reports to the Fund from 90 days to 45 days.

It was a consensus of all five compliance programs that shortening the reporting timeframe from 90 to 45 days was acceptable and would not create operational issues for them.

On a motion by Mr. Lewicki and a second by Mr. Daniel Kim, the timeframe for submitting inspection reports to the Fund was reduced from 90 to 45 days by a vote of 7-0.

2. Require at least 25% of the site inspections be completed by June 30th of each year.

The Administrator had suggested to the compliance programs 50% of the site inspections be completed by June 30th of each year. Several of the compliance programs expressed concern with meeting that completion percentage. Other employment responsibilities was given as a reason for lowering the required percentage.

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved by a vote of 7-0, requiring all compliance programs complete 25% of their annual inspections by June 30th of each year.

3. Site inspection revisions - During the September 15th meeting with the compliance programs, a request was made by one of the compliance programs to eliminate the requirement to complete a site diagram at each inspection if there have been no changes to the facility layout. It was suggested a copy of the previous site diagram be reviewed and if there are no layout changes, the diagram is dated and initialed by the inspector with the notation of ďno changes.Ē

It was suggested the site inspection form be modified to include a section for storage of drycleaning solvents. The compliance programs have seen an increase in hydrocarbon drycleaners storing solvent onsite. This suggestion is included on the revised site inspection form.

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved by a vote of 7-0 adding the solvent drum size to the inspection report and allowing the site inspector to use a copy of the previous site diagram if there have been no changes to the facility layout. The diagram copy must be dated and initialed by the site inspector.

Enclosed in the Council packet was an updated draft (September 12, 2016) of the proposed compliance program rules. Mr. Eriksen updated the draft rules approved by the Council in May based on Judge Flynnís comments at the August 26, 2016 NDI compliance program decertification status hearing. A copy was distributed on September 15th to the compliance programs and industry associations and they were requested to provide written comments on the draft rules by November 15, 2016. These draft rules will need to be modified for the policy modifications approved today. By consensus, the Council approved adding discussion of the revised draft compliance program rules to the next Council meeting agenda.

  C. Fund Solvency Update
 

Mr. Eriksen reviewed his research on obtaining drop store information from various cities and counties. Most cities and counties do not have a tracking code to specifically identify drop stores. In 2001 legislation was introduced to require registration of drycleaning drop stores for those sites in which 15% or more of gross sales at the site are attributable to drycleaning services. The legislation did not have consensus support from the drycleaning industry and was not passed.

A general discussion ensued on how drop store information could be obtained. Suggestions included;

  • Review business names for indication facility may be a drop store,
  • Contact Illinois Department of Revenue (IDOR) to determine if they have or track a business activity code,
  • Request information from licensed drycleaners.
Several Council members expressed concern the drycleaning industry is moving in the direction of fewer operating plants, with increased drop stores. Such a trend would further erode the Fundís revenue stream.

Mr. Eriksen agreed to determine if IDOR has (or tracks) a business activity code for drop stores and send a mailing to all licensed drycleaners requesting they provide the name and address of all drop stores they own/operate and all drop stores they provide wholesale drycleaning services. In addition, the mailing will request the name and address of all drop stores in the general vicinity of the licensed drycleaning plant.

APPROVAL OF PROGRAM BILLINGS
 

Mr. Eriksen noted there were two (3) bills before the Council for their review and approval. They were:

1. Williams & Company Consulting, Inc.    $43,344.00

Standard flat fee billing for August 2016, licensing, underwriting, claims processing and site inspections.

2. John J. McCarthy                             $ 3,747.50

Professional legal services to the Council for the period of August 9, 2016 through September 30, 2016.

3. Williams & Company Consulting, Inc.     $43,015.00

Standard flat fee billing for September 2016, licensing, underwriting, claims processing and site inspections.

On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the bills were approved by a vote of 7-0.

  REVIEW OF MONTHLY ACTIVITY REPORTS AND FINANCIAL STATEMENTS
 

Mr. Eriksen reviewed the monthly activity report for September 30, 2016 noting 848 licenses were in effect at the end of the month compared to 889 as of September 30, 2015. Four hundred fifty three (453) active dry-cleaning facilities had pollution liability insurance coverage with the Fund. Open claims totaled 178, with estimated reserves of $19 million.

The September 30, 2016 financial statements reflect a fund balance of $1,354,188. Year-to-date claim reimbursement requests approved for payment total $258,802.

  CLAIM PAYMENTS IN EXCESS OF $75,000
 

Mr. Eriksen noted there was one claim payment requests in excess of $75,000 requiring Council review and action.

1. Kleene Towne Cleaners, Chicago, IL; Claim #50010, Site #00012393:

Dr. So reviewed background information on the facility noting additional site investigation to delineate the horizontal and vertical extent of contamination. The request is to install ten soil borings and convert two to groundwater monitoring wells; revised the FSIR/ROR; and develop a remedial action plan. The estimated cost to complete these activities is $38,750, including contingency costs.

On a motion by Mr. Young Kim and a second by Mr. Lewicki, the Council approved the Administratorís budget request of $38,750 by a vote of 7-0.

  OTHER ISSUES
 

Mr. Eriksen noted the next meeting date is tentatively scheduled for Thursday, December 8, 2016. Mr. Polak indicated December was an extremely busy month and asked if it would be possible to meet in late November? After general discussion, the Council tentatively set the next meeting date as Tuesday, November 29, 2016.

  PUBLIC COMMENT PERIOD
 

Mr. Tae Su Jung, Fox Valley Cleaners, distributed a one page document to the Council members.

Mr. Dae Ho Yang, Alpha Cleaners, distributed two documents to the Council members.

  ETHICS TRAINING
 

Mr. Eriksen reviewed in detail with the Council the 2016 Ethics Training material for Appointees to State of Illinois Boards. Special emphasis was placed on the topics of:

  • Official Misconduct, Bribery and Solicitation Misconduct
  • Conflicts of Prohibited Political Activities
  • Prohibited Offer or Promise
  • Ban on Gifts from Prohibited Sources
  • Additional Rules for Appointees

  CLOSED SESSION
 

Mr. Eriksen noted there were several issues for discussion in Closed Session.

There being no further business, on a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council meeting adjourned at 11:58 a.m.

Respectfully submitted,

H Patrick Eriksen
Administrator

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