JULY 8, 2019 Meeting Minutes

 

MINUTES
DRYCLEANER ENVIRONMENTAL RESPONSE TRUST FUND
COUNCIL of ILLINOIS

COURTYARD CHICAGO SCHAUMBURG/WOODFIELD MALL HOTEL SCHAUMBURG, ILLINOIS

JULY 8, 2019

John Polak, Chairperson, called the Drycleaner Environmental Response Trust Fund Council of Illinois meeting to order at 1:20 p.m. A quorum was present. Roll call was taken with the following members present:

Robert Dunham
Sung Do Kang
Daniel Kim (joined the meeting at 1:22 p.m.)
Young B. Kim
John Polak

Also present were:

H. Patrick Eriksen, Program Administrator’s Office
Emily Masalski, Legal Counsel
Dr. Juho So, Program Administrator's Office
Yong Kim, Program Administrator's Office

PRELIMINARY BUSINESS

The minutes from the March 5, 2019 Council meeting were reviewed. Mr. Kang made the motion the minutes be approved as presented. The motion was seconded by Mr. Dunham and approved by a vote of 4-0.

Mr. Daniel Kim joined the meeting at 1:22 p.m.

  APPEAL OF CANCELLATION OF INSURANCE COVERAGE
 

1. Mr. Tae Su Jung, owner/operator of Oak River Cleaners, 1112 Chicago Avenue, Oak Park, IL (site #0002554), requested the Council reinstate the insurance coverage on his drycleaning facility without a lapse in coverage and reinstate the facility's remedial program benefits.

Mr. Eriksen reviewed background information outlined in his Council memo. Mr. Jung addressed the Council noting he was out of the country during the 60 day cancellation notice period due to his mother's hospitalization.

After additional discussion, on a motion by Mr. Young Kim and a second by Mr. Dunham, the Council voted 5-0 to reinstate the insurance coverage without a lapse in coverage and restore the drycleaning facility's remedial program benefits.

2. Mr. Youngkil Kim, owner/operator of Waynes Cleaners, 575 Roger Williams Ave., Highland Park, IL (site #0001613), requested the Council reinstate the insurance coverage on his drycleaning facility without a lapse in coverage. Mr. Richard Kim, ESM Compliance Program, translated for Mr. Kim.

Mr. Eriksen reviewed background information outlined in his Council memo. Mr. Kim informed the Council he had been out of town for approximately 3 months assisting his daughter in taking care of a new grandchild and his employee failed to communicate to him phone calls from the administrator's staff and the needed information. He has a new employee who is better educated and is a better communicator so this problem should not occur in the future.

After additional discussion, on a motion by Mr. Kang and a second by Mr. Young Kim, the Council voted 5-0 to reinstate the insurance coverage without a lapse in coverage.

 

APPEAL OF LOSS OF REMEDIAL PROGRAM BENEFITS

 

Mr. Lim, the appellant, contacted the administrator's office this morning informing staff he is unable to attend today's meeting due to equipment failure at his drycleaning facility. The appeal will be deferred to the next Council meeting.

 

APPEAL OF DENIAL OF INSURANCE BENEFITS

 

Mr. Pyong Lee, owner/operator of Dial Cleaners, 2827 Dundee Road, Northbrook, IL (site #0001652) requested the Council allow his October 31, 2018 claim for insurance benefits.

Mr. Eriksen reviewed background information outlined in his Council memo. Dr. Yung Yu, Hydrodynamics Consultants, Inc., and Dr. Juho So, Williams & Company Consulting, Inc., reviewed the level and location of contamination remaining at completion of the cleanup in 2013 and compared it to the contaminants found during the June 21, 2018 Limited Phase 2 Subsurface Soil & Groundwater Investigation report. Dr. Yu estimated the cost to get an NFR letter for the facility to range from $60,000 to $80,000.

After discussion by the Council, on a motion by Mr. Kang and a second by Mr. Dunham, the Council voted 5-0 to provide insurance benefits for the claim filed October 31, 2018.

 

APPEAL OF SOLVENT DELIVERY CIVIL PENALTY

  1.

Mr. Eriksen reviewed the information contained in his Council memo. Quality Cleaning Fluids, Franklin Park, IL, was assessed a $5,000 civil penalty for delivering solvent to an unlicensed drycleaner on April 18, 2018. This was their second violation; the first being assessed on January 30, 2012. He noted the DeGellegrazies were requesting waiver or reduction of the penalty.

After discussion by the Council, on a motion by Mr. Dunham and a second by Mr. Kang, the Council voted 5-0 to reduce the $5,000 penalty to $500.

  2.

Mr. Dennis Porter, representing Drug & Laboratory Disposal, Inc. (DLD), Plainwell, MI, addressed the Council regarding the assessment of a $500 penalty for a first time violation of the Council's regulations of delivering drycleaning solvent to an unlicensed drycleaner. He noted staff checks the list of licensed drycleaners posted daily to the Fund's website to confirm the drycleaner is licensed and stated he believes the website was in error. Mr. Eriksen reviewed how the website is updated automatically each evening to include all new licenses issued that day. All solvent distributors have been informed to physically review the license which drycleaners are required to post in a visible location in their facility before delivering solvent.

After discussion by the Council, on a motion by Mr. Daniel Kim and a second by Mr. Young Kim, the Council voted 5-0 to reduce the $500 penalty to $0 and any future violation(s) by DLD will be considered a second (or subsequent) violation for determining the dollar amount of the penalty.

 

APPEAL OF FINANCIAL ASSURANCE REQUIREMENT

 

Mr. Vilma was not in attendance to present his appeal. On a motion by Mr. Dunham and a second by Mr. Kang, the Council voted 5-0 to defer the appeal to a future Council meeting.

 

OPERATIONAL ISSUES

  A. Legisltative Update
 

SB0171 was passed by the legislature in May. The following are key provisions of the bill:

  1. Specifically states the Fund is not subject to sweeps, administrative charge-backs, or any other fiscal maneuver that would transfer money out of the Fund to any other fund of the State.
  2. Extends the Fund's sunset date to January 1, 2030.
  3. Extends the remedial program financial responsibility requirement (415 ILCS 135/40(j)) from January 1, 2020 to January 1, 2030.
  4. Effective January 1, 2020, inactive drycleaning facilities with an open remedial claim must pay an annual assessment of $3,000 per year until January 1, 2030. Failure to pay the annual assessment may result in a civil penalty equal to 3 times the total in assessments owed.
  5. Eliminates the Council effective June 30, 2020. Transfers administration of the Fund to the Illinois Environmental Protection Agency and the Pollution Control Board. Council cannot extend or enter into a contract for third party administration services that extends beyond June 30, 2020.
  6. Caps the IEPA administrative expenses at $600,000 per year. This is in addition to IEPA costs for reviewing remedial action plans/reports submitted by environmental consultants that the Fund reimburses on eligible, open remedial claims.
  7. Gives the IEPA authority to spend Fund monies to investigate or perform remedial actions at Fund eligible sites.
  8. In calendar years 2021 and 2022, requires the Director of IEPA to report on the status of the Fund and convene a public meeting to disseminate information on the report.
  9. Adds a new remedial claim prioritization category: "whether the claimant is currently licensed, insured, and has paid all fees and premiums due under the Act."
  10. A site receiving remedial program benefits from the Fund must enroll in IEPA's Site Remediation Program.
  11. Adds new section for "Criminal Penalties". Any person who knowingly makes an oral or written statement that is false, fictitious, or fraudulent that is materially related to or required by the Trust Fund Act or regulations, commits a Class 4 felony.
  12. The Agency may enter at all reasonable times upon any private or public property for the purpose of inspecting and investigating possible violations of the Trust Fund Act.

The bill was sent June 25, 2019 to the governor for his review and action.

  B. Summary of Calendar Year 2018 Site Inspections
 

The compliance programs performed 106 site inspections in calendar year 2018. All insured facilities had a compliance program site inspection within the Council required 4 year period.

The top three issues noted per staff review of the inspections:

  1. Secondary containment size was not calculated correctly.
  2. Inspector did not identify all drums located on secondary containment pan.
  3. Vaporizers/misters were missing or had an improper lid.
  C. Legal Representation
 

Mr. Eriksen recommended Ms. Emily Masalski be retained as legal counsel for the Council for FY20. Her rates for FY19 were $225 per hour for professional services and $100 per hour for travel time. She has requested her rates remain the same for FY20.

On a motion by Mr. Dunham and a second by Mr. Daniel Kim, the Council voted 5-0 to enter into a contract with Ms. Masalski for legal services for FY20 at $225 per hour for professional services and $100 per hour for travel time for a total cost not to exceed $29,999.

  D. Updated Financial Projections for the Period of July 1, 2018 to January 1, 2020
 

Mr. Eriksen reviewed the updated financial projections noting the projected deficit as of January 1, 2020 is $16, 268,204. This is an $8,200 reduction from prior projections.

  APPROVAL OF PROGRAM BILLINGS
 

There were two (2) bills before the Council for their review and approval::

1. Hunter Masalski LLC $ 1,272.50

Professional legal services for the period of March 1, 2019 through April 24, 2019.

2. Williams & Company Consulting, Inc. $ 51,200.00

Standard flat fee billing for March 2019, licensing, underwriting, claims processing and site inspections

3. Williams & Company Consulting, Inc. $ 47,186.50

Standard flat fee billing for April 2019, licensing, underwriting, claims processing and site inspections.

4. Williams & Company Consulting, Inc. $ 56,508.00

Standard flat fee billing for May 2019, licensing, underwriting, claims processing and site inspections

5. Williams & Company Consulting, Inc. $ 71,165.00

Standard flat fee billing for June 2019, licensing, underwriting, claims processing and site inspections.

6. Hunter Masalski LLC $ 1,272.50

Professional legal services for the period of April 25, 2019 through June 26, 2019.

On a motion by Mr. Kang and a second by Mr. Dunham, the bills were approved by a vote of 5-0.

  REVIEW OF MONTHLY ACTIVITY REPORTS AND FINANCIAL STATEMENTS
 

Mr. Eriksen reviewed the monthly activity report for June 30, 2019 noting 676 licenses were in effect at the end of the month compared to 731 licenses as of June 30, 2018. Three hundred sixty six (366) active dry-cleaning facilities have pollution liability insurance coverage with the Fund. Open claims totaled 147 with estimated reserves of $15.1 million.

The May 31, 2019 financial statements reflect a fund balance of $1,359,953.

Twenty nine (29) unlicensed drycleaners have been referred to the Attorney General's Office for enforcement action. Approximately 12 drycleaners have paid their license fee but have not submitted the required licensing paperwork.

  CLAIM PAYMENTS IN EXCESS OF $75,000S
  1. Burling Professional Cleaners, Bradley, IL; Claim #50102, Site #0002085:
 

Dr. So reviewed background information on the facility noting the budget request is for costs relating to soil vapor sampling and building control technology installation. The administrator requested budget approval of $26,295.63 which represents the remaining remedial program benefits available.

On a motion by Mr. Daniel Kim and a second by Mr. Young Kim, the Council approved the administrator's budget request of $26,296.63 by a vote of 5-0.

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

Dr. So reviewed background information on the facility noting the budget request is for costs relating to a sodium permanganate injections and post injection sampling. The administrator requested budget approval of $22,500.

On a motion by Mr. Dunham and a second by Mr. Kang, the Council approved the administrator's budget request of $22,500 by a vote of 5-0.

  3. Yorktown Cleaners, Woodridge, IL; Claim #50519, Site #0001664
 

Dr. So reviewed background information on the facility noting the budget request is for costs relating to Enhanced Reductive Dechlorination injections, excavation of soil, confirmation sampling and reporting. The administrator requested budget approval of $79,500. Total remedial costs will exceed the Fund's maximum benefit of $300,000 and the claimant has provided proof of the ability to pay the excess cost.

On a motion by Mr. Young Kim and a second by Mr. Dunham, the Council approved the administrator's budget request of $79,500 by a vote of 5-0.

  OTHER ISSUES
 

The next Council meeting is scheduled for Tuesday, August 20, 2019 beginning at 1 p.m.

  PUBLIC COMMENT PERIOD
 

Mr. Polak asked for public comment. There was none. Mr. Polak recessed the meeting at 3:15 p.m. for a brief break. The meeting reconvened at 3:20 p.m.

  CLOSED SESSION
 

On a motion by Mr. Dunham and a second by Mr. Young Kim, the Council voted 5-0 to go into closed session to discuss matters of potential litigation at 3:20 p.m.

The Council adjourned from closed session at 3:33 p.m.

On a motion by Mr. Kang and a second by Mr. Dunham, the Council voted 5-0 to reduce the 2018 license late payment penalty for Pride Cleaners, Homewood, IL, from $1,280 to $137.

On a motion by Mr. Daniel Kim and a second by Mr. Young Kim, the Council voted 5-0 to not reduce $3,652.23 owed by Eileen Cleaners, Chicago, IL and require immediate payment.

On a motion by Mr. Daniel Kim and a second by Mr. Dunham, the Council voted 5-0 to deny the request to refund Crisp N Clean of Chicago 87th, Chicago, IL the 2019 license late payment penalty fees.

There being no further business, on a motion by Mr. Dunham and a second by Mr. Daniel Kim, the Council meeting adjourned at 3:42 p.m.

  There being no further business, on a motion by Mr. Dunham and a second by Mr. Daniel Kim, the Council meeting adjourned at 3:42 p.m.

Respectfully submitted,

H Patrick Eriksen

Program Administrator
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