STATE OF INDIANA

COUNTY OF MARION

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BEFORE THE INDIANA DEPARTMENT
OF ENVIRONMENTAL MANAGEMENT

 

COMMISSIONER OF THE DEPARTMENT
OF ENVIRONMENTAL MANAGEMENT,

Complainant,

v.

BUCKEYE TERMINALS, LLC,

Respondent.

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Case No. 2015-22864-A

 

 

AGREED ORDER

 

Complainant and Respondent desire to settle and compromise this action without hearing or adjudication of any issue of fact or law, and consent to the entry of the following Findings of Fact and Order.  Pursuant to IC 13-30-3-3, entry into the terms of this Agreed Order does not constitute an admission of any violation contained herein.  Respondent's entry into this Agreed Order shall not constitute a waiver of any defense, legal or equitable, which Respondent may have in any future administrative or judicial proceeding, except a proceeding to enforce this order.

 

I.  FINDINGS OF FACT

 

1.             Complainant is the Commissioner (“Complainant”) of the Indiana Department of Environmental Management (“IDEM”), a department of the State of Indiana created by Indiana Code (“IC”) 13-13-1-1.

 

2.             Respondent is Buckeye Terminals, LLC (“Respondent”), which owns and operates the source with Plant ID No. 089-00320, located at 400 East Columbus Drive and 3823 Indianapolis Boulevard, in East Chicago, Lake County, Indiana (“Site”).

 

3.             IDEM has jurisdiction over the parties and the subject matter of this action.

 

4.             Pursuant to IC 13-30-3-3, IDEM issued a Notice of Violation (“NOV”) via Certified Mail to:

 

Mr. Clark Smith, President and CEO

Corporation Service Company – Registered Agent

Buckeye Terminals, LLC

251 East Ohio Street, Suite 500

5 Tek Park

Indianapolis, IN 46204

9999 Hamilton Boulevard

 

Breinigsville, PA 18031

 

 

5.             Buckeye Terminals, LLC owns and operates a stationary pipeline breakout tank farm and bulk liquid fuel storage and transfer terminal.

 

6.             During an investigation conducted by a representative of IDEM, the following violations were found:

 

a.    Pursuant to Part 70/Title V Operating Permit (“TVOP”) No. 089-31989-00320 (“Permit”) Condition D.5.10(a)(2), Respondent shall maintain monthly records of the number of ventdown or flaring events, which shall be complete and sufficient to establish compliance with the VOC usage limits and/or the VOC emission limits established in Permit Conditions D.5.1 and D.5.2.

From January 29 through February 1, 2013, Respondent failed to maintain records of the railcar venting volume when operating on the portable vapor combustion unit (“VCU”), in violation of Permit Condition D.5.10(a)(2).

 

b.    Pursuant to Permit Condition D.5.8(a), Respondent shall maintain a monitor to detect the presence of a pilot flame using a heat-sensing device at all times when vapors are being vented to the VCU.

From January 29 through February 1, 2013, Respondent failed to operate a monitor to detect the presence of a pilot flame using a heat-sensing device at all times when vapors are being vented to the VCU, in violation of Permit Condition D.5.8(a).

 

c.     Pursuant to Permit Condition C.8(c) and 326 Indiana Administrative Code (“IAC”) 3-6-4(b), all performance testing reports must be received by IDEM Office of Air Quality (“OAQ”) not later than forty-five (45) days after the completion of the testing.

On April 30 through May 2, 2013, Respondent conducted performance testing on the VCU and portable VCU while loading gasoline and propylene through the tank truck loading rack and propylene storage and loading facility.  The performance test report was submitted on June 21, 2013 but was due on June 16, 2013.  Respondent failed to submit the performance test report not later than forty-five (45) days after the completion of the testing, in violation of Permit Condition C.8(c) and 326 IAC 3-6-4(b).

 

d.    Pursuant to Permit Condition D.5.5(a), the VCUs for volatile organic compound (“VOC”) control shall be in operation at all times when propylene is being loaded or unloaded from the spheres or railcars and during all line purging events.

On May 9, 2013, Respondent failed to control VOC emissions using the VCUs when 21 gallons of propylene was released from a railcar, in violation of Permit Condition D.5.5(a).

 

e.    Pursuant to Permit Conditions D.2.2(d), D.6.3(a)(4), E.1.2, 40 Code of Federal Regulations (“CFR”) 60.113b(a)(4), and 326 IAC 8-9-5(b)(4), Respondent shall visually inspect the internal floating roof, the primary seal, the secondary seal, if one is in service, gaskets, slotted membranes, and sleeve seals each time the vessel is emptied and degassed.  In no event shall these inspections occur at intervals greater than ten (10) years.

Respondent conducted the required inspections for storage tanks 112, T-401, and 134 at an interval greater than ten (10) years, in violation of Permit Conditions D.2.2(d), D.6.3(a)(4), E.1.2, 40 CFR 60.113b(a)(4), and 326 IAC 8-9-5(b)(4).

 

f.      Pursuant to Permit Condition D.6.4(b)(2) and 326 IAC 8-9-6(d)(2), within sixty (60) days of performing the seal gap measurements required by 326 IAC 8-9-5(c)(1), Respondent shall furnish IDEM OAQ with a report that contains the date of measurement, the raw data obtained in the measurement, and the calculations described in 326 IAC 8-9-5(c)(2) and (c)(3).

Respondent failed to furnish IDEM OAQ with a report that contains the date of measurement, the raw data obtained in the measurement, and the calculations described in 326 IAC 8-9-5(c)(2) and (c)(3) within sixty (60) days of performing the seal gap measurements required by 326 IAC 8-9-5(c)(1), in violation of Permit Condition D.6.4(b)(2) and 326 IAC 8-9-6(d)(2).

 

g.    Pursuant to TVOP No. 089-33112-00320, Condition E.3.2 and 40 CFR 63.6655(f), Respondent shall maintain records of the hours of operation of the engine that is recorded through the non-resettable hour meter, document how many hours are spent for emergency operation, including what classified the operation as emergency and how many hours are spent for non-emergency operation.

Respondent failed to maintain records of the hours of operation of the diesel-fired emergency fire pump engine that is recorded through the non-resettable hour meter and how many hours are spent for emergency operation; including what classified the operation as emergency and how many hours are spent for non-emergency operation, in violation of TVOP No. 089-33112-00320, Condition E.3.2 and 40 CFR 63.6655(f).

 

h.    Pursuant to TVOP No. 089-33112-00320, Condition E.3.2 and 40 CFR 63.6603(a), Respondent shall change oil and filter every 500 hours of operation or annually, whichever comes first, inspect the air cleaner every 1,000 hours of operation or annually, whichever comes first, and replace as necessary, and inspect all hoses and belts every 500 hours of operation or annually, whichever comes first, and replace as necessary.

Respondent failed to change oil and filter every 500 hours of operation or annually, whichever comes first, inspect the air cleaner every 1,000 hours of operation or annually, whichever comes first, and replace as necessary, and inspect all hoses and belts every 500 hours of operation or annually, whichever comes first, and replace as necessary, in violation of TVOP No. 089-33112-00320, Condition E.3.2 and 40 CFR 63.6603(a).

 

i.      Pursuant to Permit Condition D.7.1, the VOC capture efficiency from the loading rack shall be 97.3% and the VOC emissions from the loading rack shall be less than 35 mg per liter of gasoline loaded by the loading rack.

According to submitted semi-annual reports, from January 1 through June 30, 2013, Respondent exceeded the VOC emission limit of 35 mg per liter of gasoline loaded by the loading rack for a total of 28.2 hours (1.6% of total operating time), in violation of Permit Condition D.7.1.

According to submitted semi-annual reports, from July 1 through December 31, 2013, Respondent exceeded the VOC emission limit of 35 mg per liter of gasoline loaded by the loading rack for a total of 18.2 hours (0.7% of total operating time), in violation of Permit Condition D.7.1.

 

According to submitted semi-annual reports, from January 1 through June 30, 2014, Respondent exceeded the VOC emission limit of 35 mg per liter of gasoline loaded by the loading rack for a total of 10.2 hours (0.35% of total operating time), in violation of Permit Condition D.7.1 and TVOP No. 089-33112-00320, Condition D.7.1.

 

j.      Pursuant to Permit Condition E.2.2 and 40 CFR 63.11092(b), Respondent shall install, calibrate, certify, operate, and maintain, according to the manufacturer's specifications, a continuous monitoring system (“CMS”) while gasoline vapors are displaced to the vapor processor systems.

From July 1 through December 31, 2013, Respondent failed to operate and maintain a CMS while gasoline vapors were displaced to the vapor processing systems for 19 hours (0.7% of total operating time), in violation of Permit Condition E.2.2 and 40 CFR 63.11092(b).

 

k.     Pursuant to TVOP No. 089-33112-00320, Condition E.1.2 and 40 CFR 60.115b(a)(3), if any of the conditions described in 40 CFR 60.113b(a)(2) are detected during the annual visual inspection required by 40 CFR 60.113b(a)(2), a report shall be furnished to the Administrator within 30 days of the inspection.

On September 18, 2014, Respondent conducted an annual inspection on storage tank 107 and observed conditions described in 40 CFR 60.113b(a)(2).  A report was required to be furnished to the Administrator within 30 days of the inspection, October 18, 2014.  Respondent submitted the required report on November 3, 2014, in violation of TVOP No. 089-33112-00320, Condition E.1.2 and 40 CFR 60.115b(a)(3).

 

l.      Pursuant to TVOP No. 089-33112-00320, Condition D.5.6(e)(1) and 326 IAC 8-7-9(4), in order to demonstrate compliance with TVOP No. 089-33112-00320 Condition D.5.3, Respondent shall test the control system for the propylene rail loading rack every two (2) years after the date of the initial test.

Respondent failed to conduct performance testing of the control system for the propylene rail loading rack by May 2, 2015, in violation of TVOP No. 089-33112-00320, Condition D.5.6(e)(1) and 326 IAC 8-7-9(4).

 

m.   Pursuant to Permit Condition E.2.2 and 40 CFR 63.11092(b), Respondent shall install, calibrate, certify, operate, and maintain, according to the manufacturer's specifications, a CMS while gasoline vapors are displaced to the vapor processor systems.

From January 1 through June 30, 2013, Respondent failed to operate and maintain a CMS while gasoline vapors were displaced to the vapor processing systems for 13.3 hours (0.7% of total operating time), in violation of Permit Condition E.2.2 and 40 CFR 63.11092(b).

 

7.             Respondent conducted the required inspections for storage tank 112 on October 14, 2014, on October 24, 2014 for storage tank T-401, and May 28, June 27, and September 2, 2014 for storage tank 134 as required by Permit Conditions D.2.2(d), D.6.3(a)(4), E.1.2, 40 CFR 60.113b(a)(4), and 326 IAC 8-9-5(b)(4).

 

8.             The seal gap measurements required by 326 IAC 8-9-5(c)(1) for storage tanks 202, 803, 804, and 806 were conducted on May 2, 2013.  The seal gap measurements required by 326 IAC 8-9-5(c)(1) for storage tank 801 were conducted on May 22 and June 14, 2013.  On March 30, 2015, Respondent furnished IDEM OAQ with a report that contains the date of measurement, the raw data obtained in the measurement, and the calculations described in 326 IAC 8-9-5(c)(2) and (c)(3) for storage tanks 202, 801, 803, 804, and 806.

 

9.             Respondent submitted a TVOP Administrative Amendment application received by IDEM, OAQ on February 10, 2016.  The amended TVOP No. 089-36820-00320 was issued on March 17, 2016.

 

10.          In recognition of the settlement reached, Respondent waives any right to administrative and judicial review of this Agreed Order.

 

II.  ORDER

 

1.             This Agreed Order shall be effective (“Effective Date”) when it is approved by Complainant or Complainant’s delegate, and has been received by Respondent.  This Agreed Order shall have no force or effect until the Effective Date.

 

2.             Respondent shall comply with rules and permit conditions above at issue.

 

3.             Respondent shall develop and implement an Environmental Management System (“EMS”) in accordance with elements listed in Appendix A.

 

4.             No later than thirty (30) days after the Effective Date of this Agreed Order, Respondent shall submit notification to IDEM summarizing how each element contained in Appendix A has been implemented.

 

5.             All submittals required by this Agreed Order, unless Respondent is notified otherwise in writing by IDEM, shall be sent to:

 

Brooke A. Myer, Compliance and Enforcement Manager

Compliance and Enforcement Branch – Mail Code 61-53

Indiana Department of Environmental Management

100 North Senate Avenue

Indianapolis, IN 46204-2251

 

6.             Respondent is assessed and agrees to pay a civil penalty of Forty-Nine Thousand Seven Hundred Fifty Dollars ($49,750.00).  Said penalty amount shall be due and payable to the Environmental Management Special Fund within thirty (30) days of the Effective Date; the 30th day being the “Due Date”.

 

7.             In the event the terms and conditions of the following paragraph is violated, Complainant may assess and Respondent shall pay a stipulated penalty in the following amount:

 

Paragraph

Violation

Stipulated Penalty

4

Failure to notify IDEM of EMS implementation summary.

$250/week (or part thereof)

 

8.             Stipulated penalties shall be due and payable no later than the 30th day after Respondent receives written notice that Complainant has determined a stipulated penalty is due; the 30th day being the “Due Date”.  Complainant may notify Respondent at any time that a stipulated penalty is due.  Failure to notify Respondent in writing in a timely manner of a stipulated penalty assessment shall not waive Complainant’s right to collect such stipulated penalty or preclude Complainant from seeking additional relief against Respondent for violation of this Agreed Order.  Neither assessment nor payment of stipulated penalties shall preclude Complainant from seeking additional relief against Respondent for a violation of this Agreed Order; such additional relief includes any remedies or sanctions available pursuant to Indiana law, including, but not limited to, civil penalties pursuant to IC 13-30-4.

 

9.             Civil and stipulated penalties are payable by check to the “Environmental Management Special Fund.”  Checks shall include the Case Number of this action and shall be mailed to:

 

IDEM Office of Legal Counsel

IGCN, Rm  N1307

100 N Senate Ave

Indianapolis, IN  46204

 

10.          This Agreed Order shall apply to and be binding upon Respondent and its successors and assigns.  Respondent’s signatories to this Agreed Order certify that they are fully authorized to execute this Agreed Order and legally bind the party they represent.  No change in ownership, corporate, or partnership status of Respondent shall in any way alter its status or responsibilities under this Agreed Order.

 

11.          In the event that the monies due to IDEM pursuant to this Agreed Order are not paid on or before their Due Date, Respondent shall pay interest on the unpaid balance at the rate established by IC 24-4.6-1.  The interest shall be computed as having accrued from the Due Date until the date that Respondent pays any unpaid balance.  Such interest shall be payable to the Environmental Management Special Fund, and shall be payable to IDEM in the manner specified in Paragraph 9, above.

 

12.          In the event that any terms of this Agreed Order are found to be invalid, the remaining terms shall remain in full force and effect and shall be construed and enforced as if this Agreed Order did not contain the invalid terms.

 

13.          Respondent shall provide a copy of this Agreed Order, if in force, to any subsequent owners or successors before ownership rights are transferred.  Respondent shall ensure that all contractors, firms and other persons performing work under this Agreed Order comply with the terms of this Agreed Order.

 

14.          This Agreed Order is not and shall not be interpreted to be a permit or a modification of an existing permit.  This Agreed Order, and IDEM’s review or approval of any submittal made by Respondent pursuant to this Agreed Order, shall not in any way relieve Respondent of its obligation to comply with the requirements of its applicable permit or any applicable Federal or State law or regulation.

 

15.          Complainant does not, by its approval of this Agreed Order, warrant or aver in any manner that Respondent’s compliance with any aspect of this Agreed Order will result in compliance with the provisions of any permit, order, or any applicable Federal or State law or regulation.  Additionally, IDEM or anyone acting on its behalf shall not be held liable for any costs or penalties Respondent may incur as a result of Respondent’s efforts to comply with this Agreed Order.

 

16.          Nothing in this Agreed Order shall prevent or limit IDEM’s rights to obtain penalties or injunctive relief under any applicable Federal or State law or regulation, except that IDEM may not, and hereby waives its right to, seek additional civil penalties for the same violations specified in the NOV.

 

17.          Nothing in this Agreed Order shall prevent IDEM or anyone acting on its behalf from communicating with the EPA or any other agency or entity about any matters relating to this enforcement action.  IDEM or anyone acting on its behalf shall not be held liable for any costs or penalties Respondent may incur as a result of such communications with the EPA or any other agency or entity.

 

18.          This Agreed Order shall remain in effect until IDEM issues a Resolution of Case letter to Respondent.

 

 

TECHNICAL RECOMMENDATION:

 

RESPONDENT:

Department of Environmental Management

 

Buckeye Terminals, LLC

 

 

 

By:

 

 

By:

 

 

Janusz Johnson, Chief

 

Printed:

 

 

Compliance and Enforcement Section 1

 

Title:

 

 

Office of Air Quality

 

 

 

Date:

 

 

Date:

 

 

 

 

 

 

 

 

 

 

 

COUNSEL FOR RESPONDENT:

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Date:

 

 

 

 

 

 

APPROVED AND ADOPTED BY THE INDIANA DEPARTMENT OF ENVIRONMENTAL

MANAGEMENT THIS

 

DAY OF

 

, 2016.

 

 

For the Commissioner

 

 

 

Signed on May 12, 2016

 

Keith Baugues, Assistant Commissioner

 

Office of Air Quality

 

Indiana Department of Environmental Management

 

 

 

 

 

 

Appendix A:

Environmental Management System (EMS) Elements

 

  1. General Requirements

Buckeye Terminals, LLC (hereafter “Buckeye”) shall establish, document, implement, maintain and continually improve an EMS in accordance with Appendix A and determine how it will fulfill these requirements.  Buckeye shall define and document the scope of the EMS.

 

  1. Environmental Policy

This section of the EMS comprises the policy upon which the EMS is based.  Buckeye shall clearly communicate top management’s commitment to achieving compliance with applicable federal, state, and local environmental statutes, regulations, enforceable agreements, and permits (hereafter, “environmental requirements”) and other requirements to which Buckeye subscribes, which relate to its environmental aspects.  The environmental policy must be appropriate to the nature, scale, and environmental impacts of its activities, products, and services; commit to continual environmental improvement and prevention of pollution; and provide the framework or setting and reviewing environmental objectives and targets to improve its environmental performance.  The policy shall state management’s intent to provide adequate personnel and other resources for the EMS, and shall be communicated to all persons working for or on behalf of Buckeye.  The environmental policy shall be documented, implemented, and maintained.

 

  1. Accountability and Responsibility

This section of the EMS must:

a.    Specify accountability and responsibilities of management, on-site service providers and contractors for:

                                 i.         Environmental protection practices,

                                ii.         Assuring compliance,

                               iii.         Required reporting to regulatory agencies, and

                              iv.         Corrective actions implemented in their area(s) of responsibility.

b.    Describe incentive programs for managers and employees to perform in accordance with compliance policies, standards and procedures.

c.     Describe potential consequences for departure from specified operating procedures, including liability for civil/administrative penalties imposed as a result of noncompliance.

 

  1. Communication Requirements

With regard to its environmental aspects and EMS, Buckeye shall establish, implement, and maintain procedures for:

a.    Internal communication among the various levels and functions of Buckeye.

b.    Receiving, documenting, and responding to relevant communication from external parties.

c.     Prospectively identifying and obtaining information about changes and proposed changes in environmental requirements, and incorporating those changes into the EMS.

d.    Ensuring communication with regulatory agencies regarding environmental requirements and regulatory compliance.

e.    External communication, if Buckeye decides to communicate externally about its significant environmental aspects.  Regardless, Buckeye shall decide whether to communicate externally about its significant environmental aspects, and shall document its decision.

 

  1. Assessment, Prevention, and Control

Buckeye shall:

a.    Identify an ongoing process for assessing operations, for the purpose of preventing, controlling, or minimizing reasonably foreseeable releases, environmental process hazards, and risks of noncompliance with environmental requirements.  This process shall include identifying operations and waste streams where equipment malfunctions and deterioration, and/or operator errors or deliberate malfeasance, are causing, or have the potential to cause:

                        i.         Unplanned or unauthorized releases of hazardous or harmful contaminants to the environment;

                       ii.         A threat to human health or the environment; or

                      iii.         Noncompliance with environmental requirements.

b.    Describe a process for identifying operations and activities where documented operating criteria, such as standard operating procedures (SOPs), are needed to prevent noncompliance or unplanned/unauthorized releases of hazardous or harmful contaminants, and defines a uniform process for developing, approving and implementing the documented operating criteria.

c.     Describe a system for conducting and documenting routine, objective, self-inspections by department supervisors and trained staff, especially at locations identified by the process described in Item 5a above, to check for malfunctions, deterioration, worker adherence to operating criteria, unusual situations, and unauthorized or unplanned releases.

 

  1. Environmental Incident and Noncompliance Investigations

Buckeye shall:

a.    Describe standard procedures and requirements for internal and external reporting of potential violations and release incidents.

b.    Establish, implement, and maintain a procedure(s) for dealing with actual and potential violation(s) or non-conformance(s) and for taking corrective action and preventive action.  The investigation process includes root-cause analysis of identified problems to aid in developing the corrective actions.

                             i.     The procedure(s) shall define requirements for:

1.       Identifying and correcting nonconformity(ies) and taking action(s) to mitigate their environmental impacts;

2.       Investigating nonconformity(ies), determining their cause(s) and taking actions in order to avoid their recurrence;

3.       Evaluating the need for action(s) to prevent nonconformity(ies) and implementing appropriate actions designed to avoid their occurrence;

4.       Recording the results of corrective action(s) and preventive action(s) taken; and

5.       Reviewing the effectiveness of corrective action(s) and preventive action(s) taken.

                         ii.       Actions taken shall be appropriate to the magnitude of the problems and the environmental impacts encountered.

c.     Describe a system for development, tracking, and effectiveness verification of corrective and preventative actions.

d.    Ensure that any necessary changes are made to the EMS documentation.

e.    Specify self-testing, where practicable, of the procedures developed according to Items 6a and 6b.

 

  1. Environmental Training, Awareness, and Competence

Buckeye shall ensure that any person(s) performing tasks for it or on its behalf that have the potential to cause a significant environmental impact(s) identified by Buckeye is (are) competent on the basis of appropriate education, training or experience, and shall retain associated records.  Consistent with this goal, Buckeye shall:

a.    Identify specific education and training needs associated with its environmental aspects and its EMS for any person(s) performing tasks for it or on its behalf and a process for documenting training provided.

b.    Establish, implement, and maintain a procedure(s) to make persons working for it or on its behalf aware of the importance of conformity with the environmental policy and procedures and with the requirements of the EMS; the significant environmental aspects and related actual or potential impacts associated with their work, and the environmental benefits or improved personal performance; their roles and responsibilities in achieving conformity with the requirements of the EMS; and the potential consequences of departure from specified procedures.

 

  1. Environmental Planning and Auditing

Buckeye shall:

a.    Establish, on an annual basis, written targets, objectives, and action plans for improving environmental performance, by at least each operating organizational subunit with environmental responsibilities, as appropriate, including those for contractor operations conducted at the facility, and how specified actions will be tracked and progress reported.  Targets and objectives must include actions that reduce the risk of noncompliance with environmental requirements and minimize the potential for unplanned or unauthorized releases of hazardous or harmful contaminants.

b.    Describe a program for periodic audits (at least annually) of facility compliance with environmental requirements.  Audit results are reported to upper management and instances of noncompliance are addressed through the process described in Item 6c above.

 

  1. Management Review

a.    Top management shall review Buckeye’s EMS at planned intervals to ensure its continuing suitability, adequacy, and effectiveness.  Reviews shall include assessing opportunities for improvement and the need for changes to the EMS, including the environmental policy and environmental objectives and targets.  Records of the management reviews shall be maintained.

b.    Input to management reviews shall include:

                             i.     Communication(s) from external interested parties, including complaints;

                            ii.     The environmental performance of Buckeye;

                          iii.     The extent to which objectives and targets have been met;

                          iv.     Status of corrective and preventive actions;

                           v.     Follow-up actions from previous management reviews;

                          vi.     Changing circumstances, including developments in legal and other requirements related to its environmental aspects; and

                         vii.     Recommendations for improvement.

c.     The outputs from management reviews shall include any decisions and actions related to possible changes to environmental policy, objectives, targets, and other elements of the EMS, consistent with the commitment to continual improvement.

 

  1. Public Involvement/Community Outreach

The EMS should include a procedure for ongoing community education in the environmental aspects of Buckeye’s operations and general environmental awareness of Buckeye’s activities.