Via Certified Mail #:                                         Via Certified Mail #:

To: Scott Lougheed, President                             Mike Everton, President
Scott Lougheed & Associates                             Earth Construction, Inc.
1017 South Hadley                                             4002 Engleton Drive
Fort Wayne, IN 46804-5535                             Fort Wayne, IN 46804

Based on an investigation, the Indiana Department of Environmental Management (IDEM) has reason to believe that Scott Lougheed & Associates and Earth Construction, Inc. (Respondents) have violated environmental rules and statutes. The violations are based on the following:

1. Respondents engaged in closure activities at the Arlington Heights wastewater treatment plant (WWTP) located on the east side of Highway 24, approximately 1.5 miles south of Roanoke, in Huntington County, Indiana (the "Site').

2. Pursuant to 327 IAC 2-1-6(a)(1), all waters at all times and places, including the mixing zone, shall meet the minimum conditions of being free from substances, materials, floating debris, oil, or scum attributable to municipal, industrial, agricultural, and other land use practices, or other discharges:

(A) that will settle to form putrescent or otherwise objectionable deposits;
(B) that are in amounts sufficient to be unsightly or deleterious
(C) that produce color, odor, or other conditions in such degree as to create a nuisance;
(D) which are in amounts sufficient to injure, be acutely toxic to, or otherwise produce serious adverse physiological responses in humans, animals, aquatic life, or plants; and
(E) which are in concentrations or combinations that will cause or contribute to the growth of aquatic plants or algae to such a degree as to create a nuisance be unsightly, or otherwise impair the designated uses.

3. Pursuant to IC 13-30-2-1 a person may not discharge, emit, cause, allow, or threaten to discharge, emit, cause, or allow any contaminant or waste into the environment in any form that causes or would cause pollution that violates or would violate rules, standards, or discharge or emission requirements adopted by the appropriate board under the environmental management laws.

4. Pursuant to IC 13-18-4-5, a person may not: (1) throw, run, drain, or otherwise dispose into any of the streams or waters of Indiana, or (2) cause, permit, or suffer to be thrown, run, drained, allowed to seep, or otherwise disposed into any waters, any organic or inorganic matter that causes or contributes to a polluted condition of any waters, as determined by a rule of the board adopted under IC 13-18-4-1 and IC 13-18-4-3.

5. IDEM representatives have conducted an investigation of the Arlington Heights WWTP closure activities. The investigation revealed that, on or about September 23, 2003, the Respondents were engaged in closure activities at the Arlington Heights WWTP that resulted in the discharge of solids and/or sludge to the Little Wabash River, a water of the state, via the Arlington Heights WWTP Outfall 001, in violation of 327 IAC 2-1-6(a)(1), and therefore in violation of IC 13-30-2-1 and IC 13-18-4-5.

In accordance with IC 13-30-3-3, the Commissioner herein provides notice that violations may exist and offers an opportunity to enter into an Agreed Order providing for the action required to correct the violations and for the payment of a civil penalty. The Commissioner is not required to extend this offer for more than sixty (60) days.

As provided in IC 13-30-3-4, an alleged violator may enter into an Agreed Order without admitting that the violations occurred. IDEM encourages settlement by Agreed Order, thereby resulting in quicker correction of the environmental violations and avoidance of extensive litigation. Timely settlement by Agreed Order may result in a reduced civil penalty. Also, settlement discussions will allow the opportunity to present any mitigating factors that may be relevant to the violations.

If an Agreed Order is not entered into within 60 days of receipt of this Notice of Violation, the Commissioner may issue a Notice and Order under IC 13-30-3-4 containing the actions that must be taken to correct the violations and requiring the payment of an appropriate civil penalty. Pursuant to IC 13-30-4-1, the Commissioner may assess penalties of up to $25,000 per day for each violation.

To discuss this matter further, please contact Dave Knox at (317) 233-5975 within fifteen (15) days after receipt of this Notice to request a conference. If settlement is reached, an Agreed Order will be prepared and sent for review and signature.

For the Commissioner:

Date: _Issued 3/19/04__________________________

Felicia A. Robinson
Deputy Commissioner
for Legal Affairs

cc: U.S. E.P.A., Region 5
Huntington County Health Department