Objection to Denial of Excess Liability Trust Fund
Claim No. 200710506/FID No. 9465 Fuels,
2009 OEA 6, (08-F-J-4068)
[2009 OEA 6= , page 6 begins]
OFFICIAL S= HORT CITATION NAME: When referring to 2009 OEA 6, cite this case as
&nbs=
p; Fuels,
Topics: &=
nbsp;
pipeline
dispenser
contamination
UST
Environmental Site Assessment
petroleum
tank registration fees
Excess Liability Trust Fund
release
Presiding Environmental Law Judge= :
Mary L. Davidsen
Party representatives:
IDEM: = ; Julie E. Lang, Esq.
Petitioner: = ; Glenn D. Bowman, Esq., Robert M. Frye, Esq.; Stewart & Irwin, P.C.
Order issued:
February 20, 2009
Index category:
Land
Further case activity:
[none]
[2009 OEA 6= , page 7 begins]
STATE OF
&n= bsp; = ; &n= bsp; = ; ) &= nbsp; &nbs= p; ENVIRONMENTAL ADJUDICATION
IN THE MATTER OF: &= nbsp; &nbs= p; &= nbsp; &nbs= p; )
&n= bsp; = ; &n= bsp; = ; &n= bsp; = ; )
OBJECTION TO DENIAL OF
EXCESS LIABILITY TRUST FU= ND &= nbsp; &nbs= p; ) &= nbsp;
CLAIM NO. 200710506 / FID=
NO.
9465 &nb=
sp; )
FUELS,
FINDI=
NGS OF
FACT, CONCLUSIONS OF LAW AND FINAL ORDER GRANTING SUMMARY JUDGMENT
This matter is before the= Court pursuant to Motions for Summary Judgment filed by Claimant Allan Willig, for a facil= ity operated as Fuels, USA, and by Respondent, Indiana Department of Environmen= tal Management, as to whether any genuine issues of material fact exist as to Respondent, Indiana Department of Environmental Management’s (“IDEM”) determination that Willig was not eligible reimburseme= nt from the Excess Liability Trust Fund for failure to pay tank fees for 1988 through 1992, and Willig was not in substantial compliance with then-applic= able spill reporting requirements, based on dispenser-area contamination reporte= d in 2007. The parties fully briefed their positions on summary judgment, participated in oral argument,= and submitted proposed findings of fact, conclusions of law and orders. The Chief Environmental Law Judge (“ELJ”) having considered the petitions, testimony, evidence, a= nd pleadings of the parties, now finds that judgment may be made upon the reco= rd. The Chief ELJ, by substantial evid= ence, and being duly advised, now makes the following findings of fact and conclusions of law and enters the following Order:
FINDINGS OF FACT
1. Claimant Allan J. =
Willig
and his spouse, (collectively referred to as “Willig”), own real
estate located at
2. From 1986 to 1991,
Willig leased the Site to James and Arlene Boes (“Boes”), who
operated a truck stop known as Fuels,
[2009 OEA 6= , page 8 begins]
3. In early 1991, wit=
hout
notice to Willig, Boes ceased operating the Site, had the pipelines and
dispensers removed but did not remove the tanks or pay the 1990 tank fees.<=
span
style=3D'mso-spacerun:yes'>
4. Upon discovering that Boes was no longer operating the Site, Wil=
lig
engaged an environmental contractor to close and remove the USTs. The USTs were removed from the pro=
perty
in June, 1991. Id. Soil from the each tank’=
;s pit
floor and sidewall areas were sampled, and no contamination from petroleum
constituents was discovered above 10mg/kg.=
5. In 1991, Willig an= d his contractor reported the UST closure and removal, including soil sampling results, to IDEM.
6. In the fall, 2007, Willig engaged an environmental contractor to
perform a Phase 1 Environmental Site Assessment (“ESA”) at the
Site, for purposes of a potential Site sale. On the contractor’s recommen=
dation
based on UST presence in the past at the Site, a Phase II ESA was
performed. The Phase II ESA
revealed evidence of petroleum releases in the areas of the former gasoline
dispenser islands and at the former combined gasoline and diesel dispenser
islands, which information was reported to IDEM. See Initial Site Characterizati=
on
Report, FID 9465, Incident Nos. 200710500 and 200710506 (“ISC”)=
at
2, 3 and Figure 11. In dr=
afting
the ISC, Willig’s consultant noted the absence of any 1991 sampling d=
ata
related to the pipeline and dispenser areas.
7. IDEM required Willig to conduct further delineation and characterization of the contamination, which work Willig authorized.
8. On October 25, 200= 7, IDEM received Willig’s request for a determination of eligibility to = the IDEM’s Excess Liability Trust Fund (ELTF). Willig Affidavit. On or about February 6, 2008, IDEM issued its determination that Willig was not eligible for ELTF reimbursement for the following reasons:
1. Willig had paid less than 50% of t= he necessary tank fees in a timely manner with years 1988 through 1990 being deficient; and
2. Willig was not in substantial=
compliance
with spill reporting requirements as no regulated tanks existed at the site
since June, 1991 and no release was reported at the time of tank removal.
9. Willig timely= filed its Petition for Review on February 11, 2008.
[2009 OEA 6= , page 9 begins]
10. For 1988 tank registrati= on fees, Willig offered his affidavit statement as evidence of payment to the Indiana Department of Revenue (“IDOR”), as required. Petitioner’s Motion, Exs.= 1, 2. For 1989 fees, during the December= 15, 2008 Oral Argument, Willig submitted receipts for registration fees paid in June of 1989. Petitioner&#= 8217;s Supplemental Designation of Matters in Support of Motion for Summary Judgme= nt, Ex. 1. For 1991 tank registration fees, the parties did not contest that Willig paid tank registration fees for 1991 in a timely manner. IDEM’s Reply in Support o= f Its Motion for Summary Judgment, pg. 3.
11. For 1990 fees, Wi= llig provided payment receipts which indicated that payment was not made until January of 1992; more than six months after the USTs were removed. Petitioner’s Motion, Ex. = 1A. When Willig received the February, = 1992 invoice for UST registration fees for fiscal year 1991, Willig sent a Febru= ary 9, 1992 letter to IDOR, informing the State that the USTs had been removed = in June, 1991, and to confirm that the State had received 1990 UST fees. 1990 fee payment was confirmed fur= ther by an August 5, 1993 letter from IDOR.
12. Both parties filed Motions for Summary Judgment on September 25, 2008, responses on October 24, 2008 and reply briefs on November 26, 2008. Oral Argument was conducted on Dec= ember 15, 2008. Proposed Findings of Fact, Conclusions of Law and Orders were submitted on December 23. 2008 by Claimant and on December 24, 2008 by Respondent, the IDEM.
CONCLUSIONS OF LAW
all issues = are to be determined anew, based solely upon the evidence adduced at that hearing = and independent of any previous findings.
[2009 OEA 6= , page 10 begins]
=
Grisell
v.
4. =
The O=
EA may
enter judgment for a party if it finds that “the pleadings, depositio=
ns,
answers to interrogatories, and admissions on file, together with the
affidavits and testimony, if any, show that a genuine issue as to any mater=
ial
fact does not exist and that the moving party is entitled to judgment as a
matter of law.” I.C.
5. =
“The fact that both parties requested summary
judgment does not alter our standard of review. Instead, we must separately
consider each motion to determine whether there is a genuine issue of mater=
ial
fact and whether the moving party is entitled to judgment as a matter of
law.”
6. =
OEA is required to base its factual findings on
substantial evidence. Huffman v. Office of Envtl. Adjud., 811 N.E.2d
806, 809 (Ind. 2004)(appeal of OEA review of NPDES permit); see also
I.C. § 4-21.5-3-27(d). W=
hile
the parties disputed whether IDEM’s determination of Willig’s E=
LTF
claim was proper, OEA is authorized “to make a determination from the
affidavits . . . pleadings or evidence.” I.C. § 4-21.5-3-23(b). “Standard of proof generally=
has
been described as a continuum with levels ranging from a "preponderanc=
e of
the evidence test" to a "beyond a reasonable doubt" test. The
"clear and convincing evidence" test is the intermediate standard,
although many varying descriptions may be associated with the definition of
this intermediate test.” Matter
of
[2009 OEA 6= , page 11 begins]
7.&n=
bsp; =
;
Willig’s February 22, 2008 Petition for
Review objecting to the February 6, 2008 Determination was filed in a timely
manner. The petition raises t=
wo (2)
issues for consideration. The=
first
is that IDEM erred in calculating Willig’s eligibility. The second is that IDEM erred in
concluding that Willig was not in substantial compliance with spill reporti=
ng
requirements as no regulated tanks existed at the site since June, 1991 and=
no
release was reported at the time of tank removal.
8.&n=
bsp; =
;
In order to receive reimbursement from the
Excess Liability Trust Fund (“ELTF”), a claimant must meet its
requirements to pay annual tank registration fees to the Indiana Department=
of
Revenue, for each tank that has not been closed before July 1 of any year.<=
span
style=3D'mso-spacerun:yes'> I.C. § 13-23-12-1. This requirement began in 1998, wi=
th the
first payment due by September 1, 1998.&nb=
sp;
I.C. § 13-7-20-32(b)(1988)(repealed 1996).
9.&n=
bsp; =
;
For purposes of reimbursement from the Excess
Liability Trust Fund (“ELTF”), underground storage tank
(“UST”) owners and operators may be reimbursed for eligible cos=
ts
arising out of releases of petroleum according to the formula provided in 3=
28
IAC 1-3-3(b)<=
span
style=3D'mso-special-character:footnote'>[2]
as follows:
(b) Persons listed in section 1 of this=
rule
shall be eligible to apply to the fund for reimbursement from the fund
according to the following formula:
<=
span
style=3D'mso-list:Ignore'>(1)&=
nbsp;
Determine the number of payments that w=
ere
owed under I.C. §
13-23-12-1 on all regulated tanks at the facility from which a release
occurred, beginning with the date that the fees for each tank first became =
due
under I.C. § 13-=
23-12
and continuing until the date on which the release occurred.
<=
span
style=3D'mso-list:Ignore'>(2)&=
nbsp;
Determine the number of payments actual=
ly
made under I.C. §
13-23-12-1 on all regulated tanks at the facility from which a
release occurred, beginning with the date each tank became regulated under =
I.C.
§ 13-23 and continuing until the date on
which the release occurred. Divide the number of payments actually made by =
the number
of payments due as determined in subdivision (1).
<=
span
style=3D'mso-list:Ignore'>(3)&=
nbsp;
Determine the amount of money the person
would have received from the fund if all payments due on the date the relea=
se
occurred had been paid when due and multiply the amount by:
[2009 OEA 6= , page12 begins]
(=
A) &=
nbsp; the
percentage determined in subdivision (2), if the percentage is fifty percent
(50%) or more; or
(=
B) &=
nbsp; zero
(0), if the percentage determined in subdivision (2) is less than fifty per=
cent
(50%). (emphasis added)
10.
I.C.
§ 13-23-12-5(a), and its predecesso=
r I.C.
§ 13-7-20-32(d), requires the perso=
n who
pays underground storage tank fees to keep a copy of the receipt. In addition, 328 IAC 1-3-3(a)(1)
requires that an applicant to the ELTF demonstrate that “the requirements in I.C. § 13-2=
3-8-4(a)(1)
through I.C. § 13-23-8-4(a)(4) have been met.”<=
span
style=3D'mso-spacerun:yes'> This includes the requirement that=
tank
fees have been paid. <=
span
style=3D'color:black'>Therefore, the obligation to retain UST fee receipts =
and
produce them upon request lies with the owner/operator. Since here, IDEM determined that f=
our
years of tank fee payments, 1988-1991, had to be considered in calculating
Willig’s percent eligibility, Willig, as owner/operator, has the
obligation to retain and produce UST fee receipts .
11.
As support for i=
ts
Motion for Summary Judgment, Willig offered affidavit testimony of his beli=
ef
that 1988 tank fees had been paid.
Applicable law, cited above in para. 13, requires the owner/operator=
to
retain and produce UST fee receipts.
No provision excepts an owner/operator from that duty, even if those
documents may have been maintained by Boes, as Site operators, during the
period of their lease. Willig has not provided substantial evidence to supp=
ort
a conclusion that 1988 UST fees were paid for 1988. 1988 tank fees cannot be
used in calculating Willig’s ELTF eligibility.
12.
Claimant Willig =
has
provided substantial evidence of a lack of genuine issue of material fact t=
hat
UST fees were paid for 1989, 1990 and 1991. IDEM’s calculations interpre=
ted
applicable ELTF regulations to require UST fees for years 1988, 1989, 1990 =
and
1991 to be used in calculating Willig’s ELTF eligibility. However, th=
ere
is no dispute of fact that the tanks were closed in June, 1991, before July=
1,
1991. Willig’s tank fee
payment for 1991 is not required for calculating the ELFT eligibility. As
Willig paid UST fees for two (2) out of three (3) years of relevant
eligibility, or 66%, Willig is 66% eligible for reimbursement, provided Wil=
lig
was in substantial compliance with applicable requirements.
13.
To be
eligible for ELTF reimbursement, Willig was required to be in substantial
compliance with the spill reporting requirements in effect in 1991. In 1991, the ELTF eligibility
requirements of I.C. § 13-7-20-33(d) stated:
<= /p>
An owner or oper= ator may receive money from the fund under subsection (a)(1) or (a)(3) only if t= he following requirements are satisfied:
[2009 OEA 6= , page 13 begins]
(A)&= nbsp; &= nbsp; This chapter.
(B)&= nbsp; &= nbsp; Rules adopted under this chapter.
(C)&= nbsp; &= nbsp; 42 U.S.C. 6991 through 6991i.
(D)&= nbsp; &= nbsp; Regulations published under 42 U.S.C. 6991 through 6991i.
A release from an underground petroleum storage tank my not prevent an owner or operator from establishing compliance with this subdivision to receive money from the fun= d.
14.&= nbsp; As determined previously by this Court, definition of “substantial compliance” shall define “substantial” as “being largely but not wholly that which is specified”, and “compliance” as “conformit= y in fulfilling official requirements”.&n= bsp; In the Matter of: Objections to Denial of Excess Liability Trust Fund #200203501, GasAmerica #47, Greenfield, Hancock County, Indiana<= /i>, 2004 OEA 123 (November= 19, 2004). Since no statute, regulation, or policy at the time defined ‘substantial complianceR= 17;, this Court has applied a ‘totality of the circumstances’ test t= o determine whether substantial compliance has been met. Objections to Denial of Excess Liability Trust Fund Claim No. 9202513, Johnson Oil Company, Columbus, Bartholomew County, Indiana, Cause No. 03-F-J-3279, 2005 OEA 63, 68 (December 1, 2005)= .
15.&= nbsp; In 1991, Claimant Willig was subject to Federal Regulation of USTs, including = 40 C.F.R. § 280.72, which required: =
(a) Before permanent closure or a change-in-service is completed, owners and operators must measure for the presence of a release where contamination is most likely to be present at the UST site.=
According t= o 40 C.F.R. § 280.12, an “UST means any one or combination of tanks (including underground pipes connected thereto)…” IDEM argued that the closure proce= dures applicable to the site at the time required Willig to test the surrounding underground pipes as well as the tank pit, which may have revealed the release. The surrounding underground pipes were installed and removed by a third party at the direct= ion of the lessee of the site, Boes, prior to Willig’s tank closure. Boes contracted with that third pa= rty to remove the pumps and pipes prior to the closure of the USTs. No evidence was presented that the surrounding underground pipes had reportable releases prior to their remova= l. Therefore, when Claimant Willig contracted to have the USTs
[2009 OEA 6= , page 14 begins]
closed and removed, he may have assumed that the pipes and pumps were properly rem= oved and that soil testing of that area had been conducted.
16.&=
nbsp; Under
the ‘totality of the circumstances’ test, Claimant Willig
substantially complied with the applicable 1991 UST closure requirements.
17.&= nbsp; Claimant Willig discovered the release during the Phase II ESA in 2007. 329 IAC 9-4-1 (2003) provides that= a duty to report a release is triggered by the discovery of a release. When Willig discovered the release= in 2007, he complied with all applicable statutes and regulations. IDEM was timely notifi= ed of the spill. At that time, IDEM required Willig to further delineate and characterize the contaminated site. Willig authorized that testing. No further facts hav= e been introduced by either party to demonstrate a genuine issue of material fact = as to whether Willig was required to test at the sites of surrounding undergro= und pipes. The totality of the circumstances indicates that Claimant Willig made a good faith effort to substantially comply with the closure and removal requirements in 1991. In addition, Willig complied with = the spill reporting requirements when the release was discovered in 2007. Finally, since the release was rep= orted, Willig has complied with IDEM requirements at the site. Therefore, Willig substantially co= mplied with the ELTF requirements and is entitled to Summary Judgment on the issue= of ELTF eligibility as a matter of law.
18.&= nbsp; Sufficient evidence has been produced by Claimant Willig to meet his burden of proof t= hat no genuine issue of material fact exists that Willig paid UST fees for 1999= and 1990, and is eligible for 66% reimbursement of ELFT claim number 200710506,= if Willig’s claim met other reimbursement eligibility requirements. Will= ig presented sufficient evidence of a lack of genuine issue of material fact t= hat Willig substantially complied with then-applicable spill reporting requirem= ents. On its Motion for Summary Judgment, seeking an opposite result on the same issues, IDEM has not produced suffic= ient evidence in support of its contentions.&nb= sp; As a matter of law, summary judgment should be granted in Claimant Willig’s favor, and denied as to IDEM.
FINAL ORDER
For all of the foregoing = reasons, IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that:
[2009 OEA 6= , page 15 begins]
You are further notified = that pursuant to provisions of I.C. § 4-21.5-7-5, the Office of Environment= al Adjudication serves as the ultimate authority in administrative review of decisions of the Commissioner of the Indiana Department of Environmental Management. A party is eligib= le to seek Judicial Review of this Order as stated in applicable provisions of I.= C. § 4-21.5, et seq. Pursuant to I.C. § 4-21.5-5-5= , a Petition for Judicial Review of this Order is timely only if it is filed wi= th a civil court of competent jurisdiction within thirty (30) days after the date this notice is served.
IT =
IS
SO ORDERED this 20th day of February, 2009 in
Hon. Mary L. Davidsen
Chief Environmental Law Judge
[2009 OEA 6: end of decision]
2009 OEA 6 in .doc format
2009 OEA 6 in .pdf format
[1] Indiana, via IDEM, began requiring UST owner/operators to pay a registration fee for each UST tank, to be paid annually per the State’s fiscal yea= r, which fiscal year begins on July 1, and ends the following June 30. Ind. Code § 1307020-32 (1991)= . Willig would pass each annual invo= ice to the Boes for payment.
[2] This rule was authorized by Ind. Code § 13-23-8-4.5.
Objection to Denial of Excess Liability Trust Fund
Claim No. 200710506/FID No. 9465 Fuels,
2009 OEA 6, (08-F-J-4068)