                                                                                 FILED
                                    2015 IL App (4th) 140593                       July 7, 2015
                                                                                  Carla Bender
                                          NO. 4-14-0593                       4th District Appellate
                                                                                    Court, IL
                                 IN THE APPELLATE COURT

                                          OF ILLINOIS

                                      FOURTH DISTRICT

                                                     Petition for Direct Review of
THE ESTATE OF GERALD D. SLIGHTOM,               )
           Petitioner,                          )    an Order of the Illinois
                                                     Pollution Control Board
            v.                                  )
                                                     PCB No. 11-25
THE POLLUTION CONTROL BOARD and THE             )
ILLINOIS ENVIRONMENTAL PROTECTION               )
AGENCY,                                         )
            Respondents.                        )
______________________________________________________________________________

               PRESIDING JUSTICE POPE delivered the judgment of the court, with opinion.
               Justices Turner and Steigmann concurred in the judgment and opinion.

                                            OPINION

¶1             In June 2014, the Pollution Control Board (Board) affirmed the decision of the

Illinois Environmental Protection Agency (IEPA or Agency) to deny the request for

reimbursement of the Gerald D. Slightom estate (Estate) from the Leaking Underground Storage

Tank Fund (LUST Fund) for costs associated with cleaning up property, upon which a gas

station had operated, located in Girard, Illinois. The Estate appeals, arguing the Board erred in

affirming the Agency's decision. We reverse and remand with directions.

¶2                                     I. BACKGROUND

¶3             In 1991, Gerald D. Slightom, who owned the property in question, reported a

release of gasoline, used oil, and heating oil from underground storage tanks on the property. All

of the underground tanks were removed from the property shortly thereafter.
¶4             On December 6, 1991, IEPA received Slightom's application for reimbursement

from the LUST Fund for corrective action costs for the property. According to the application,

Slightom became aware of a release on August 30, 1991. The storage tanks had been registered

with the office of the State Fire Marshal (State Fire Marshal) on April 18, 1990. On December

20, 1991, IEPA responded to Slightom via letter, stating as follows: "It has been determined that

you are eligible to seek reimbursement for corrective action costs, accrued on or after July 28,

1989, in excess of $100,000.00." The letter continued:

                         "A $100,000.00 deductible applies to sites where the owner

               or operator had registered none of the underground storage tanks

               located at the site prior to July 28, 1989. (Section

               22.18b(d)(3)(B)(i) of the Illinois Environmental Protection Act).

               The review of your Application, and/or confirmation with *** the

               State Fire Marshal, indicates that none of the tanks at the site were

               registered prior to July 28, 1989."

The property was not remediated.

¶5             In September 1993, Title XVI of the Environmental Protection Act (Act) (415

ILCS 5/57 to 57.17 (West 1994)), known as the Leaking Underground Storage Tank Program

(LUST Program), went into effect pursuant to Public Act 88-496. The purpose of the LUST

Program is as follows:

               "(1) to adopt procedures for the remediation of underground

               storage tank sites due to the release of petroleum and other

               substances regulated under this Title from certain underground

               storage tanks or related tank systems; (2) to establish and provide



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              procedures for a [LUST] Program which will oversee and review

              any remediation required for leaking underground storage tanks,

              and administer the [LUST] Fund; (3) to establish [a LUST] Fund

              intended to be a State fund by which persons who qualify for

              access to the [LUST] Fund may satisfy the financial responsibility

              requirements under applicable State law and regulations; (4) to

              establish requirements for eligible owners and operators of

              underground storage tanks to seek payment for any costs

              associated with physical soil classification, groundwater

              investigation, site classification and corrective action from the

              [LUST] Fund; and (5) to audit and approve corrective action

              efforts performed by Licensed Professional Engineers." 415 ILCS

              5/57 (West 2012).

Public Act 88-496 repealed sections 22.18b and 22.18c of the Act (415 ILCS 5/22.18b, 22.18c

(West 1992)), which had been the law regarding eligibility requirements and disbursements from

the LUST Fund as it existed at that time. See Pub. Act 88-496 (eff. Sept. 13, 1993). Under the

repealed law, IEPA applied the deductible to an award of LUST Funds. Under Public Act 88-

496, the State Fire Marshal became responsible for determining the deductible.

¶6            In 1997, after Title XVI was in effect, section 732.603(b) of the Board's

administrative rules regarding Petroleum Underground Storage Tanks was amended by adding

the language "or the Agency." See 35 Ill. Adm. Code 732.603(b)(1), amended at 21 Ill. Reg.

3617 (eff. July 1, 1997). The amended section read: "Any deductible, as determined by the

[State Fire Marshall] or the Agency, shall be subtracted from any amount approved for payment



                                               -3-
by the Agency or by operation of law ***." 35 Ill. Adm. Code 732.603(b)(1), amended at 21 Ill.

Reg. 3617 (eff. July 1, 1997). In 2002, section 732.603 of the Board's administrative rules was

amended again, adding the following provision: "Where more than one deductible determination

is made, the higher deductible shall apply." 35 Ill. Adm. Code 732.603(b)(4), amended at 26 Ill.

Reg. 7119 (eff. Apr. 29, 2002). (These rules were later codified at 35 Ill. Adm. Code 734.615,

adopted at 30 Ill. Reg. 5090 (eff. Mar. 1, 2006)).

¶7             In September 2007, 14 years after Title XVI went into effect, Gerald Slightom

died. In November 2007, Slightom's Estate contacted CSD Environmental (CSD), a consulting

firm, to determine whether the property at issue could be remediated so as to obtain a "No

Further Remediation" letter for less than $15,000. Shane Thorpe, a senior project manager for

CSD, reviewed the online LUST incident tracking database administered by IEPA, which,

according to the Estate's brief, "informed Thorpe that very little work had been performed at the

property." Thorpe also reviewed the State Fire Marshal's online database and response to a

Freedom of Information Act (FOIA) request. He found no evidence of a prior eligibility and

deductibility determination in the State Fire Marshal's records. As a result, Thorpe believed the

Estate would be eligible for a $15,000 deductible.

¶8             The Estate retained CSD to apply to the State Fire Marshal for an eligibility and

deductibility determination. The Estate's agreement with CSD was contingent on the Estate

receiving a deductible of $15,000 or less. The State Fire Marshal determined on February 6,

2008, the Estate would be eligible to seek reimbursement from the LUST Fund, subject to a

$10,000 deductible. The State Fire Marshal forwarded a copy of its decision and the application

materials to IEPA.




                                                -4-
¶9             Based on the State Fire Marshal's deductible determination, the Estate executed

an election to proceed as "owner" of the property. The "Election to Proceed as 'Owner' " form

stated:

               "I understand that by making this election I become subject to all

               of the responsibilities and liabilities of an 'owner' under Title XVI

               of the Environmental Protection Act and the Illinois Pollution

               Control Board's rules at 35 Ill. Adm. Code 734. I further

               understand that, once made, this election cannot be withdrawn."

IEPA approved the Estate's election to proceed as "owner," stating in part:

                      "As the new owner, you may be eligible to access the

               [LUST] Fund for payment of costs related to remediation of the

               release. For information regarding eligibility and the deductible

               amount to be paid, please contact *** the State Fire Marshal ***."

¶ 10           On March 12, 2008, IEPA informed the Estate the Stage I Site Investigation Plan

was approved pursuant to the Estate's certification. The letter also stated: "Please be advised

that, if you do not meet the eligibility requirements as determined by *** the State Fire Marshal,

you may not be entitled to payment from the [LUST] Fund for costs incurred." The Stage I work

revealed contamination was still present on the property.

¶ 11           On January 29, 2009, IEPA sent a letter to the Estate, stating in part:

               "As a result of [IEPA's] review of the application for payment [for

               work done in the period from February 11, 2008, to October 2,

               2008], a voucher for $19,239.08 will be prepared for submission to

               the Comptroller's Office for payment as funds become available



                                                -5-
               based upon the date [IEPA] received the application for payment.

               Subsequent applications for payment that have been or are

               submitted will be processed based upon the date of receipt by

               [IEPA]. This constitutes [IEPA's] final action with regard to the

               above application for payment."

                      The deductible amount of $10,000 was withheld from your

               payment."

¶ 12           The Estate also submitted a series of Stage 3 investigation plans and budgets.

These Stage 3 investigations were intended to determine the extent of offsite contamination onto

neighboring property. After the extent of offsite contamination had been determined, a site

investigation completion report was submitted and conditionally approved on July 8, 2010.

IEPA also approved $82,057.28 in actual Stage 3 costs plus handling charges.

¶ 13           On July 19, 2010, the Estate applied for payment of $83,912.58. As of August 4,

2010, the LUST Incident Tracking Database showed a $10,000 deductible applied to the site.

¶ 14           However, upon review, IEPA determined a $100,000 deductible, not a $10,000

deductible, should be applied to the remediation work pursuant to IEPA's 1991 deductible

determination. On October 29, 2010, IEPA issued a decision, finding a voucher could not be

prepared for submission to the Comptroller's Office for payment. The denial letter stated:

               "Pursuant to 35 Ill. Adm. Code Part 734.615(b)(4)[,] where more

               than one deductible determination has been made, the higher

               deductible shall apply. On December 20, 1991[,] the [Agency]

               issued an Eligibility and Deductibility Determination of

               $100,000.00 for this site. A second Eligibility and Deductibility



                                              -6-
               Determination of $10,000.00 was issued on February 6, 2008[,] by

               the *** State Fire Marshal. The [Agency] has determined that the

               $100,000.00 deductible applies to this site."

¶ 15           In December 2010, the Estate appealed IEPA's decision to the Board. In

September 2013, IEPA issued a new decision, approving payment in the approximate amount of

the original application for payment. According to the Agency's new decision:

               "Re-review of the October 29, 2010[,] decision is warranted under

               information presented in an appeal filed with the [Board]

               December 6, 2010[,] and assigned case number PCB 2011-25 ***.

                      ***

                      This letter addresses all issues presented in the

               aforementioned appeal in favor of the applicant. As a result of [the

               Agency's] re-review of this application for payment, a voucher for

               $83,908.73 will be prepared for submission to the Comptroller's

               Office for payment."

Shortly thereafter, the Estate's consultant received a check for $83,908.73, which was deposited.

¶ 16           IEPA moved to dismiss the Estate's appeal to the Board as moot. The Estate

opposed the motion because its claim for attorney fees was not moot. The Board denied IEPA's

motion, holding IEPA was without jurisdiction to reconsider its earlier decision.

¶ 17           After a hearing, the Board affirmed IEPA's original decision to allow a $100,000

deductible, with one member dissenting.

¶ 18           This appeal followed.

¶ 19                                      II. ANALYSIS



                                               -7-
¶ 20           The primary issue in this case is the amount of deductible the Estate is required to

pay before it can access payment from the LUST Fund. After the State Fire Marshal notified the

Estate a $10,000 deductible would be applied, the Estate began the process of remediating the

property. When the Estate applied to IEPA for final payment from the LUST Fund, IEPA

informed the Estate the $100,000 deductible it had prescribed to Gerald Slightom in 1991 would

be applied regardless of the $10,000 deductible set by the State Fire Marshal. On administrative

appeal, the Board agreed with IEPA's determination a $100,000 deductible applied in this case.

¶ 21           The Board noted the State Fire Marshal erred in applying a $10,000 deductible

pursuant to section 57.9(b)(1) of Title XVI of the Act (415 ILCS 5/57.9(b)(1) (West 2008)) as it

read on February 6, 2008. However, the Board recognized this deductible determination was not

appealed and constituted a final determination. The Board found IEPA's $100,000 deductible

determination, which it made on December 20, 1991, was correct based on the law in effect in

1991 (see Ill. Rev. Stat. 1989, ch. 111 1/2, ¶ 1022.18b(d)(3)(B)(i) (repealed 1993)). Because

IEPA's 1991 deductible determination was not appealed, the Board stated it was faced with "two

conflicting final agency determinations."

¶ 22           The Board held, "under the circumstances of this case, the earlier [IEPA]

decision, and the correct decision, applies." According to its decision:

                       "In its 'Election to Proceed as Owner,' the Estate elected to

               'become subject to all of the responsibilities and liabilities of an

               'owner' under Title XVI of the Environmental Protection Act and

               the Illinois Pollution Control Board's rules at 35 Ill. Adm. Code

               Part 734.' *** The Estate also argues that it elected to become an

               owner in reliance on [the State Fire Marshall's] $10,000



                                                -8-
deductibility determination. [Citations.] Taking the Estate's

position that it elected to proceed under Title XVI of the Act and

Part 734 of the Board's regulations, the Estate subjected itself to

the language of 35 Ill. Adm. Code 734.615(b), which sets forth

rules applying to deductibles.

       As discussed above, Mr. Slightom was assigned a $100,000

deductible determination, and the Estate was assigned a $10,000

deductible determination. The two deductible amounts apply to

the same incident number at the same site. ***

       The Estate has elected to proceed under Part 734 of the

Board's regulations. *** The language of Part 734.615(b)

anticipates that deductibles may have been issued by [the State Fire

Marshal] or [IEPA]. See 35 Ill. Adm. Code 734.615(b)(1) ('Any

deductible, as determined by the [State Fire Marshall] or [IEPA],

must be subtracted from any amount approved for payment by

[IEPA] or by operation of law, or ordered by the Board or courts.')

(emphasis added). Further, '[o]nly one deductible must apply per

occurrence.' 35 Ill. Adm. Code 734.615(b)(2). 'Where more than

one deductible determination is made, the higher deductible must

apply.' 35 Ill. Adm. Code 734.615(b)(4). In this case, there have

been two deductible determinations made for the same incident.

The language of Part 734.615(b)(4) is clear and the $100,000

deductible applies to the site." Estate of Gerald D. Slightom v.



                                 -9-
               Illinois Environmental Protection Agency, Ill. Pollution Control

               Bd. Op. 11-25 (June 19, 2014).

¶ 23           The Board is correct the language of its administrative rule called for the

$100,000 deductible to be applied. Section 734.615(b) states:

                      "b) The following rules must apply regarding deductibles:

                                1) Any deductible, as determined by the

                      [State Fire Marshall] or [IEPA], must be subtracted

                      from any amount approved for payment by [IEPA]

                      or by operation of law, or ordered by the Board or

                      courts;

                                2) Only one deductible must apply per

                      occurrence;

                                3) If multiple incident numbers are issued

                      for a single site in the same calendar year, only one

                      deductible must apply for those incidents, even if

                      the incidents relate to more than one occurrence;

                      and

                                4) Where more than one deductible

                      determination is made, the higher deductible must

                      apply." 35 Ill. Adm. Code 734.615(b), adopted at

                      30 Ill. Reg. 5090 (eff. Mar. 1, 2006).

The question is whether this is a valid rule pursuant to the rulemaking authority provided to the

Board by the General Assembly.



                                                - 10 -
¶ 24           " '[A]n administrative agency is a creature of statute[;] any power or authority

claimed by it must find its source within the provisions of the statute by which it is created.' "

Granite City Division of National Steel Co. v. Illinois Pollution Control Board, 155 Ill. 2d 149,

171, 613 N.E.2d 719, 729 (1993) (quoting Bio-Medical Laboratories, Inc. v. Trainor, 68 Ill. 2d

540, 551, 370 N.E.2d 223, 228 (1977)). Section 57.14A (415 ILCS 5/57.14A (West 2008))

concerns administrative rules governing Title XVI. It states:

                        "(a) The Agency shall propose and the Board shall adopt

               amendments to the rules governing the administration of this Title

               to make the rules consistent with the provisions herein.

                        (b) Until such time as the amended rules required under

               this Section take effect, the Agency shall administer this Title in

               accordance with the provisions herein." 415 ILCS 5/57.14A (West

               2008).

¶ 25           An agency's decision on a question of law is not binding on a reviewing court.

Our review of a question of law is independent and not deferential to the agency. Cinkus v.

Village of Stickney Municipal Officers Electoral Board, 228 Ill. 2d 200, 210, 886 N.E.2d 1011,

1018 (2008). In other words, our standard of review is de novo. Our supreme court has stated:

                        "As in all cases of statutory interpretation, our duty is to

               ascertain and give effect to the intent of the legislature. [Citation.]

               The best evidence of the legislature's intent is the language of the

               statute, which must be given its plain and ordinary meaning.

               [Citations.] Where the statutory language is clear, it will be given

               effect without resort to other aids of construction. [Citations.]"



                                                 - 11 -
               Hadley v. Illinois Department of Corrections, 224 Ill. 2d 365, 371,

               864 N.E.2d 162, 165 (2007).

"Where an administrative rule conflicts with the statute under which it was adopted, the rule is

invalid." Id. at 385, 864 N.E.2d at 173.

¶ 26           Title XVI of the Act is clear the State Fire Marshal is responsible for making

eligibility and deductible determinations. Section 57.9(c) of Title XVI states:

               "Eligibility and deductibility determinations shall be made by ***

               the State Fire Marshal.

                              (1) When an owner or operator reports a

                      confirmed release of a regulated substance, *** the

                      State Fire Marshal shall provide the owner or

                      operator with an 'Eligibility and Deductibility

                      Determination' form. The form shall either be

                      provided on-site or within 15 days of *** the State

                      Fire Marshal receipt of notice indicating a

                      confirmed release. The form shall request sufficient

                      information to enable *** the State Fire Marshal to

                      make a final determination as to owner or operator

                      eligibility to access the [LUST] Fund pursuant to

                      this Title and the appropriate deductible. The form

                      shall be promulgated as a rule or regulation

                      pursuant to the Illinois Administrative Procedure

                      Act by *** the State Fire Marshal. Until such form



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                       is promulgated, *** the State Fire Marshal shall use

                       a form which generally conforms with this Act.

                               (2) Within 60 days of receipt of the

                       'Eligibility and Deductibility Determination' form,

                       *** the State Fire Marshal shall issue one letter

                       enunciating the final eligibility and deductibility

                       determination, and such determination or failure to

                       act within the time prescribed shall be a final

                       decision appealable to the *** Board." 415 ILCS

                       5/57.9(c) (West 2008).

Section 57.8 of Title XVI (415 ILCS 5/57.8 (West 2008)) also makes clear IEPA's

responsibilities as to its processing of payment applications, stating in relevant part:

                       "(a) Payment after completion of corrective action

               measures. The owner or operator may submit an application for

               payment for activities performed at a site after completion of the

               requirements of Sections 57.6 and 57.7, or after completion of any

               other required activities at the underground storage tank site.

                               (1) In the case of any approved plan and

                       budget for which payment is being sought, the

                       Agency shall make a payment determination within

                       120 days of receipt of the application. Such

                       determination shall be considered a final decision.

                       The Agency's review shall be limited to generally



                                                - 13 -
                      accepted auditing and accounting practices. In no

                      case shall the Agency conduct additional review of

                      any plan which was completed within the budget,

                      beyond auditing for adherence to the corrective

                      action measures in the proposal. If the Agency

                      fails to approve the payment application within 120

                      days, such application shall be deemed approved by

                      operation of law and the Agency shall proceed to

                      reimburse the owner or operator the amount

                      requested in the payment application. However, in

                      no event shall the Agency reimburse the owner or

                      operator an amount greater than the amount

                      approved in the plan.

                                              ***

                              (4) Any deductible, as determined pursuant

                      to *** the State Fire Marshal's eligibility and

                      deductibility final determination in accordance with

                      Section 57.9, shall be subtracted from any payment

                      invoice paid to an eligible owner or operator. Only

                      one deductible shall apply per underground storage

                      tank site." (Emphases added.)

Nowhere in Title XVI is the Agency given the authority to apply a deductible it, as opposed to

the State Fire Marshal, determined to be appropriate.



                                              - 14 -
¶ 27           As a result, the administrative rule in question in this case (35 Ill. Adm. Code

734.615(b)(4), adopted at 30 Ill. Reg. 5090 (eff. Mar. 1, 2006)) is invalid insofar as it allows the

Agency to apply a deductible the Agency determined to be appropriate as opposed to the

deductible the State Fire Marshal determined to be appropriate when a party has elected to

proceed pursuant to Title XVI of the Act. The Estate chose to proceed pursuant to Title XVI.

¶ 28           We note neither the administrative rule in question (35 Ill. Adm. Code

734.615(b)(1), adopted 30 Ill. Reg. 5090 (eff. Mar. 1, 2006)) nor its predecessor rule (35 Ill.

Adm. Code 732.603(b), amended at 21 Ill. Reg. 3617 (eff. July 1, 1997)), each of which allow

IEPA's deductible determination to be considered, was in effect when Title XVI of the Act

became law in 1993. Because the Agency's decision to apply the $100,000 deductible and the

Board's decision to affirm the Agency's decision were based on an administrative rule contrary to

the clear language of Title XVI, we hold the Board erred in affirming the Agency's decision and

find the $10,000 deductible determined by the State Fire Marshal should have been applied

based on the facts in this case.

¶ 29           Because we are reversing the Board's determination the Agency correctly applied

a $100,000 deductible, we remand this case to the Board to consider the Estate's request for

reimbursement of legal defense costs pursuant to section 57.8(l) of Title XVI (415 ILCS

5/57.8(l) (West 2008)).

¶ 30                                    III. CONCLUSION

¶ 31           For the reasons stated above, we reverse the Board's decision and remand for

further proceedings consistent with this opinion.

¶ 32           Reversed; cause remanded with directions.




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