STATE OF INDIANA

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SS:

BEFORE THE INDIANA DEPARTMENT OF

 

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COUNTY OF MARION

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ENVIRONMENTAL MANAGEMENT

 

COMMISSIONER OF THE DEPARTMENT

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OF ENVIRONMENTAL MANAGEMENT,

 

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Complainant,

 

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v.

 

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Case Nos. 2018-25794-A &

2020-27284-A

 

 

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SOUTH BEND ETHANOL, LLC,

 

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Respondent.

 

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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 Indiana Code (“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 IC 13-13-1-1.

 

2.             Respondent is South Bend Ethanol, LLC (“Respondent”), which owns and operates the stationary fuel-grade ethanol production plant with Plant ID No. 141-00033, located at 3201 West Calvert Street, in South Bend, St. Joseph 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, on May 3, 2021, IDEM issued a Notice of Violation (“NOV”) via Certified and Electronic Mail to:

 

Mercuria Energy America Inc.

National Registered Agents, Inc,

Attn: Manager

Registered Agent

20 East Greenway Plaza

Suite 650

334 North Senate Avenue

Indianapolis, IN  46204

Houston, TX  77046

CTSOPReceipt@wolterskluwer.com

 

5.             During investigations conducted by representatives of IDEM, the following violations were found:

 

a.             Pursuant to Part 70 Permit 141-37438-00033 condition D.4.3(c), total VOC emissions shall not exceed 3.99 pounds/hour for the two RTOs identified as RTO-1 and RTO-2.

 

Respondent exceeded 3.99 pounds of VOC/hour for the two RTOs during a stack test conducted on August 1, 2018, in violation of Part 70 Permit 141-37438-00033 condition D.4.3(c).

 

b.             Pursuant to Part 70 Permit 141-39515-00033 condition C.14(b) and subsequent permits with the same condition, a retest to demonstrate compliance shall be conducted within one hundred eighty (180) days of a noncompliant stack test.

Respondent failed to conduct a retest of the two RTOs within one hundred eighty (180) days after the stack test failure on August 1, 2019, in violation of Part 70 Permit 141-39515-00033 condition C.14(b) and subsequent permits with the same condition.

 

c.              Pursuant to Part 70 Permit 141-39515-00033 condition D.4.10(c) and subsequent permits with the same condition, on and after the date the approved stack test results are available, the Permittee shall operate the thermal oxidizer at or above the 3-hour average temperature as observed during the most recent compliant stack test.

From May 29, 2019 through August 28, 2020, Respondent operated the RTOs below the 3-hour average temperature as observed during the stack test conducted on April 11, 2019, in violation of Part 70 Permit 141-39515-00033 condition D.4.10(c) and subsequent permits with the same condition.

 

d.             Pursuant to Part 70 Permit 141-42120-00033 condition D.5.2(d) and subsequent permit with the same condition, the load-out natural gas-fired flare, identified as G-602, shall not exceed 4,034 hours of loadout per twelve (12) consecutive month period, with compliance determined at the end of each month.

In January, February and March 2020, Respondent exceeded 4,034 hours of loadout per twelve (12) consecutive month period, with compliance determined at the end of each month, in violation of Part 70 Permit 141-42120-00033 condition D.5.2(d) and subsequent permit with the same condition.

 

6.             Respondent conducted extensive maintenance on both RTO units.  Respondent subsequently retested the RTOs on April 11, 2019 which demonstrated compliance with revised limits in Part 70 Permit 141-39515-00033 which was issued on November 26, 2018.

 

7.             On August 28, 2020, Respondent raised the operating temperature of the RTOs to the temperature determined during testing on April 11, 2019.

 

8.             Respondent re-evaluated the operations of the alcohol load-out, a malfunction of the flare hour-meter was discovered.  Respondent determined and implemented a different methodology to track and report alcohol load-out hours.

 

9.             Orders of the Commissioner are subject to administrative review by the Office of Environmental Adjudication under IC 4-21.5; however, in recognition of the settlement reached, Respondent acknowledges notice of this right and 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 Part 70 Permit 141-42172-00033 unless superseded by a permit modification or renewal.

 

3.             All submittals required by this Agreed Order, unless IDEM notifies the Respondent otherwise in writing, shall be sent to:

 

Matthew Chaifetz, Senior Enforcement Case Manager

Office of Air Quality

Indiana Department of Environmental Management

100 North Senate Avenue

Indianapolis, IN 46204-2251

mchaifet@idem.IN.gov

 

4.             Respondent is assessed and agrees to pay a civil penalty of Seventy-One Thousand Six Hundred Dollars ($71,600.00).  Within thirty (30) days of the Effective Date of the Agreed Order, Respondent shall pay a portion of this penalty in the amount of Seventeen Thousand Nine Hundred Dollars ($17,900.00).  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”. In lieu of payment of the remaining civil penalty, Respondent shall make a cash payment to the Indiana Finance Authority (“IFA”) to fund a Supplemental Environmental Project (“SEP”) of activities related to brownfield development at a brownfield site (“Brownfield Site”) in South Bend, Indiana.  Respondent will make a payment in the amount of Fifty-Three Thousand Seven Hundred Dollars ($53,700.00) to fund SEP activities at the Brownfield Site.  Respondent shall make such payment to the IFA within thirty (30) days of the Effective Date of his Agreed Order.  Payment to the IFA satisfies Respondent’s obligation to undertake a SEP to offset a portion of the civil penalty assessed in this matter.  Implementation of this SEP will benefit the community by rejuvenating neighborhoods, increasing tax base, mitigating threats to human health and the environment and/or reducing blight.

 

The Brownfield Site at which some or all of the SEP proceeds will be spent will be determined by the Brownfields Program for a site located in South Bend, Indiana. The designation of this Brownfield Site to receive the SEP proceeds is agreed upon by the Complainant, Respondent and the IFA.  The IFA will account for the SEP payment and the Brownfields Program will oversee the work undertaken at the Brownfield Site funded by the SEP proceeds.  If SEP proceeds remain following a determination by the Brownfields Program that no additional SEP proceeds are needed at the Brownfield Site, the Brownfields Program will select another site or sites in South Bend at which work will be funded with the balance of the SEP proceeds.  The IFA will notify IDEM’s Enforcement Case Manager when SEP-funded activities at the Brownfield Site (and any other site at which activities may be funded with SEP proceeds) are complete.

 

In the event that Respondent does not make its SEP payment within thirty (30) days of the Effective Date of this Agreed Order, the full amount of the civil penalty as stated in this paragraph, 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 to IDEM 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.

 

Payment for the SEP is payable by check to the “Indiana Finance Authority.”  The text “SEP- South Bend” and the Case Number of this action shall be included in the memo line of the check.  The check shall be mailed to:

 

Andrea Robertson

Indiana Brownfields Program – SEP

100 N. Senate Avenue

Room 1275

Indianapolis, IN 46204

 

Respondent shall provide Complainant with documentation of payment to the Indiana Finance Authority within one (1) week of such payment.

 

5.             Civil 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:

 

Indiana Department of Environmental Management

Accounts Receivable

IGCN, Room 1340

100 North Senate Avenue

Indianapolis, IN 46204

 

6.             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 5, above.

 

7.             Signatories to this Agreed Order certify that they are fully authorized to execute this Agreed Order and legally bind the party they represent.

 

8.             This Agreed Order shall apply to and be binding upon Respondent and all successors and assigns. Respondent shall provide a copy of this Agreed Order, if in force, to any subsequent owners, successors, or assigns before ownership rights are transferred.

 

9.             No change in ownership, corporate, or partnership status of Respondent shall in any way alter the Respondent’s status or responsibilities under this Agreed Order.

 

10.          Respondent shall ensure that all contractors, firms, and other persons performing work under this Agreed Order comply with the terms of this Agreed Order.

 

11.          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.

 

12.          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 the obligation to comply with the requirements of any applicable permits or any applicable Federal or State laws or regulations.

 

13.          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.

 

14.          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 violation specified in the NOV.

 

15.          Nothing in this Agreed Order shall prevent IDEM or anyone acting on its behalf from communicating with the U.S. Environmental Protection Agency (“U.S. 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 U.S. EPA or any other agency or entity.

 

16.          This Agreed Order shall remain in effect until Respondent s complied with all terms and conditions of this Agreed Order and IDEM has issued a Resolution of Case letter to Respondent.

 

 

 

TECHNICAL RECOMMENDATION:

 

RESPONDENT:

Department of Environmental Management

 

South Bend Ethanol, LLC

 

 

 

By:

 

 

By:

 

 

David P. McIver, Chief

 

Printed:

 

 

Enforcement Section

 

Title:

 

 

Office of Air Quality

 

 

 

Date:

 

 

Date:

 

 

 

 

 

 

 

 

 

COUNSEL FOR COMPLAINANT:

 

COUNSEL FOR RESPONDENT:

For the Department of Environmental Management

 

 

 

 

 

By:

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Date:

 

 

Date:

 

 

 

 

 

 

APPROVED AND ADOPTED BY THE INDIANA DEPARTMENT OF ENVIRONMENTAL

MANAGEMENT THIS

 

DAY OF

 

, 2021.

 

 

For the Commissioner:

 

 

 

Signed on October 5, 2021

 

Matthew Stuckey

 

Assistant Commissioner

 

Office of Air Quality

Indiana Department of Environmental Management