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.

CATERPILLAR, INC.,

Respondent.

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Case No. 2012-21218-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 Caterpillar, Inc. (“Respondent”), which owns and operates the source with Plant ID No. 157-00044, located at 3701 State Road 26 East in Lafayette, Tippecanoe 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 an Amended Notice of Violation (“NOV”) to Douglas R. Oberhelman, President, and CT Corporation System, Registered Agent.

 

5.            Respondent is a stationary internal combustion engine manufacturing source.

 

6.            During an investigation including an inspection on September 26, 2012 conducted by a representative of IDEM, the following violations were found:

 

a.            Pursuant to Condition D.6.8 of Permit No. 157-31472-00044 (“Permit”), daily inspections shall be performed to verify the placement, integrity and particle loading of dry filters. If a condition exists which should result in a response step, the Respondent shall take reasonable response steps.

 

Pursuant to Condition D.6.5 of the Permit and 326 IAC 6-3-2, particulate from the surface coating shall be controlled by a dry particulate filter, and the Respondent shall operate the control device in accordance with manufacturer’s specifications.

 

Respondent did not maintain the placement and integrity of the dry filters, in violation of Condition D.6.8 of the Permit, Condition D.6.5 of the Permit and 326 IAC 6-3-2.

 

b.            Pursuant to Condition D.6.2 of the Permit and 326 IAC 8-2-9, the cleanup or color change containers shall be closed as soon as the solvent spraying is complete. All solvent shall be disposed of in such a manner that minimizes evaporation.

 

Respondent had the lid open on the paint gun washer and had solvent dripping from the paint gun washer into an open bucket, in violation of Condition D.6.2 of the Permit and 326 IAC 8-2-9.

 

c.            Pursuant to Condition D.6.9 of the Permit and 326 IAC 2-2, the Respondent shall maintain records of the amount of coating material and solvent less water used, cleanup solvent used for each month, and total VOC usage for each month.

 

Respondent did not maintain complete records of the amount of coating materials used, cleanup solvent used for each month, and accurate total VOC usage for each month, in violation of Condition D.6.9 of the Permit and 326 IAC 2-2.

 

d.            Pursuant to 40 CFR 63, Subpart MMMM, Respondent must collect and keep records of the calculation of each twelve (12) month organic hazardous air pollutant (HAP) emission rate, and the content of each coating, thinner and/or other additive, and cleaning material used during the compliance period when coatings with HAP contents 1.0% or greater are used.

Respondent used a coating with HAP content of 1.0% or greater without maintaining required records, in violation of 40 CFR 63, Subpart MMM. 

 

e.            Pursuant to 326 IAC 8-2-9, Respondent shall store all VOC containing coatings, thinners, coating related waste, and cleaning materials in closed containers.

Respondent had open paint containers in the metal recycling bin that contained waste coating, in violation of 326 IAC 8-2-9.

 

7.            Respondent repaired/replaced paint booth dry filters corrected the open lid on the paint gun washer and repaired the paint gun leaking solvent immediately following the inspection.  Respondent completed training and implementation of additional internal procedures to prevent reoccurrence.

 

8.            As of January 1, 2013, Respondent has only received and plans to use cleanup solvent containing less than 1.0% hazardous air pollutants such that there is no requirement to calculate the twelve-month organic HAP emission rate otherwise required in 40 CFR 63, Subpart MMMM.

 

9.            Respondent submitted revised quarterly reports of VOC usage for the time period starting January 1, 2012 and ending March 31, 2013.

 

10.         Respondent submitted corrected emissions statements replacing those originally submitted for calendar years 2008 through 2011.

 

11.         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 applicable provisions of 326 IAC 6-3-2, 326 IAC 8-2-9, 40 CFR 63 Subpart MMMM and the Permit at issue in Findings of Fact Paragraph 6.

 

3.            Within sixty (60) days of the Effective Date, Respondent shall submit an application to incorporate practically enforceable details of the solvent reclamation process in the Permit and document the current insignificant activity designation of the paint storage/mixing room.  Said permit application shall be sent to:

 

IDEM Air Permits Administration

ATTN: Incoming Application

100 North Senate Avenue

MC 61-53, IGCN 1003

Indianapolis, IN 46204-2251

 

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

 

Janusz Johnson, Section Chief

Compliance and Enforcement Branch – Mail Code 61-53

Indiana Department of Environmental Management

100 North Senate Avenue

Indianapolis, IN 46204-2251

 

5.            Respondent is assessed a civil penalty of Twelve Thousand Five Hundred Dollars ($12,500).  Within thirty (30) days of the Effective Date of the Agreed Order, Respondent shall pay a portion of this penalty in the amount of Two Thousand Five Hundred dollars ($2500).  Said penalty amount shall be due and payable to the Environmental Management Special Fund.  In lieu of payment of the remaining civil penalty, Respondent shall perform and complete a Supplemental Environmental Project (“SEP”).  Respondent estimates that this SEP will cost Forty Thousand Two Hundred Forty One dollars ($40,241).  Within 30 days of completing this SEP, Respondent shall submit written notice and documentation to IDEM which substantiates all actions taken and costs incurred with respect to the SEP.  In the event that the cost of the SEP is less than Twenty Thousand dollars ($20,000), Respondent shall pay fifty percent (50%) of the difference between that amount and the actual cost of the SEP.

 

6.            As a Supplemental Environmental Project, Respondent shall complete a Perimeter Lighting Replacement Project to reduce energy consumption at the Site.  The project replaces 45 high pressure sodium lights with 45 LED lights.  Respondent shall purchase necessary equipment and complete installation by no later than May 15th, 2014.  Respondent shall provide a status report on progress by December 31st, 2013 if project completion has not occurred by that date.  Implementation of this SEP is expected to reduce energy consumption at the Site by two hundred fifteen million British thermal units per year (215 MMBtu/yr).

 

7.            In the event that Respondent does not complete the SEP by May 15th, 2014, the full amount of the civil penalty as stated in Order Paragraph No. 5, above, plus interest established by IC 24-4.6-1-101 on the remaining amount, less the portion of the civil penalty Respondent has already paid, will be due within fifteen (15) days from Respondent's receipt of IDEM’s notice to pay.  Interest, at the rate established by IC 24-4.6-1-101, shall be calculated on the amount due from the date which is thirty (30) days after the Effective Date of this Agreed Order until the full civil penalty is paid.

 

8.            Respondent agrees to pay Title V Emissions fees in the amount of Four Thousand Eighty Three dollars and Seventy Five cents ($4,083.75). These Title V Emissions fees are assessed for the period of January 1, 2008 to December 31, 2011, during which Respondent did not report 99 tons of VOC emissions.  Said fee amount shall be due and payable to IDEM within thirty (30) days of the Effective Date.

 

9.            In the event the terms and conditions of the following paragraphs are violated, Complainant may assess and Respondent shall pay a stipulated penalty in the following amount:

 

Paragraph

Violation

Stipulated Penalty

4

Failure to submit permit application

$100 per week

 

10.         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.

 

11.         Civil penalties and Title V Emissions fees are payable by check to “IDEM”. A cover letter shall accompany the check specifying that the civil penalties required in Order Paragraph No. 5 shall be deposited into the “Environmental Management Special Fund”, and Four Thousand Eighty Three dollars and Seventy Five cents ($4,083.75) in Title V Emissions Fees shall be deposited into the “Title V Investments Fund.”  Checks shall include the Case Number of this action and shall be mailed to:

 

Indiana Department of Environmental Management

Cashier – Mail Code 50-10C

100 North Senate Avenue

Indianapolis, IN 46204-2251

 

12.         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.

 

13.         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 15, above.

 

14.         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.

 

15.         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.

 

16.         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.

 

17.         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.

 

18.         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.

 

19.         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.

 

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

 

 

TECHNICAL RECOMMENDATION:

 

RESPONDENT:

Department of Environmental Management

 

Caterpillar, Inc.

 

 

 

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

 

, 2013.

 

 

For the Commissioner

 

 

 

Signed on October 23, 2013

 

Keith Baugues, Assistant Commissioner

 

Office of Air Quality

 

Indiana Department of Environmental Management