March 2003 Meeting Minutes

	MINUTES
	DRYCLEANER ENVIRONMENTAL RESPONSE TRUST FUND COUNCIL of ILLINOIS HOLIDAY INN NAPERVILLE, ILLINOIS MARCH 27, 2003
	John Polak, Chairperson, called the Drycleaner Environmental Response Trust Fund Council of Illinois meeting to order at 9:46 a.m. A quorum was present. Roll call was taken with the following members present:
	John Bredenkamp (via telephone) Augustine Chung David Gibson Young B. Kim Jerry Lewicki John Polak Also present were: H. Patrick Eriksen, Program Administrator's Office C. Michael Perkins, Program Administrator's Office Juho So, Program Administrator's Office
	PRELIMINARY BUSINESS
	The minutes from the February 18, 2003 Council meeting were reviewed. On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the minutes were approved by a vote of 6-0. The minutes from the February 28, 2003 Council meeting were reviewed. On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the minutes were approved by a vote of 6-0. Mr. Polak noted that there would be a couple of deviations from the posted agenda. The first was that the appeal of the license late payment penalty would be deferred until 11:30 a.m. Secondly, agenda issue D, Update on Innovative Technology Projects-United Cleaners, Lemont, IL, would be moved up to the next item on the agenda to accommodate the schedule of Jay Jaktar.
	OPERATIONAL ISSUES
	D.	Update on Innovative Technology Project-United Cleaners
		Mr. Matt Cohen, of the Jeff Diver group, addressed the Council, stating that the project has not met its cleanup goal and that additional time is needed to complete the remediation of the project. He noted a majority of the site has been cleaned up with one (1) small area needing additional treatment. Jay Jaktar, developer of the heated soil vapor extraction technology, stated that it is going to be necessary to add at least two (2) wells, one for injecting additional heat into the soil and the second extraction well to recover the volatized contaminants. He is estimating the additional cost of the two (2) wells is approximately $5,000 and is requesting that the Council consider extending the timeframe for completing the project but also give consideration to funding an additional $5,000. Mr. Jaktar noted the higher contaminate levels are 2-3 feet below the surface. It is his opinion that since the system was operating during the winter months and the top surface was not insulated, that the HSVE technology has not been effective in remediating the contaminant located close to the surface. He is estimating that the current contamination level is 240 PPM and can be reduced to below the cleanup goal of 100 PPM in the next 90-120 days. Dr. Juho So questioned Mr. Cohen and Mr. Jaktar on why the Fund has not been presented with additional detailed information on the specific results of the project. Mr. Jaktar reported that it was the obligation of K-Plus Environmental Consultants to provide the analytical data and written report to the Fund as well as the Illinois Environmental Protection Agency (IEPA). Dr. So expressed frustration that the consultant has not kept the Fund adequately informed as to the status. It was his understanding less than 30 days ago, that the project was on point to be completed by the end of February, which was the 60-day extension granted by United Cleaners to Jay Jaktar and the consultant. The Council questioned at length the need to expend an additional $5,000 on the project. Mr. Jaktar requested that the $5,000 would only be payable if the project was successful. Mr. Polak noted that he felt that the Council has been fairly generous in previous extensions plus increases in the budget based on what was originally presented to the Council in February 2002. Mr. Eriksen asked for clarification if Mr. Cohen and Mr. Jaktar were asking for Council extension of 120 days from March 1st or 120 day extension from April 1st. Mr. Cohen replied it would be 120-day extension beginning March 1, 2003 and stated that if the project is not successful by July 1, 2003, they would not come back for an additional request but would look to some other technology to complete the remediation of the facility. Mr. Chung suggested a 30-day extension to allow the consultant to provide current data and then make a determination whether to allow the additional time. Mr. Cohen replied that he would prefer to extend it only once, as he noted that if it were not completed within 120 days, they would look at some other technology. Mr. Eriksen commented that the Council's financial exposure in approving the project's extension would be $37,000. This is the difference between the approved project budget which is approximately $60,000 if the project is unsuccessful, and the cost if it is successful which is approximately $97,000. He noted his staff is not certain that existing technologies can clean up the remaining hot spot for the approximately $37,000 difference. A motion was made by Mr. Gibson to extend until July 1, 2003, the completion date of the innovative technology project without the provision of any additional funding. The motion was seconded by Mr. Bredenkamp. Mr. Bredenkamp commented that provided the consultant provides some additional up-to-date reports to the Council in the very near future, the Council should consider the reimbursement of the additional $5,000 cost if it is justified. Mr. Gibson accepted the friendly amendment and the motion passed by a vote of 6-0.
	A.	Legislative Update:
		Mr. Polak thanked the drycleaner associations and individual drycleaners who worked with the Council on drafting the amendments to the Trust Fund Act. On a personal note, he stated he was proud of the Council, that they had done a detailed discussion of each suggestion provided them and had overwhelmingly recommended and adopted the recommendations put forth by the industry. Mr. Polak summarized the key benefits of the Council's proposed legislation that included: a) a doubling of the benefits to $300,000, which guarantees that a majority of the drycleaners will have adequate benefits to pay for remediation of any contamination that exists at their drycleaning facility; b) extending the sunset date of the Fund by 10 years to provide additional revenue to pay for the cleanup of contaminated sites; c) extending the testing period by two (2) years which allows drycleaners additional time to plan and budget for intrusive testing at their facilities; d) creating a new category of green solvent which will provide incentives to drycleaners using green solvents on virgin sites; e) creating a broader matrix for licensing purpose to take into account the diversities and economic differences between drycleaners based upon their use of drycleaning solvents; f) creating an amnesty period to allow drycleaners an opportunity to buy Fund insurance coverage and qualify for remedial benefits; g) incorporating necessary technical corrections that the Council has requested for more than three (3) years. Mr. Polak reported that he received word and a letter late Wednesday evening from the Korean American Drycleaners Association of Chicagoland (KADA) stating that they were no longer supporting HB1553 without being specific to why they are opposed to the bill. Mr. Chang Lee, a KADA director, stated that he had attended a KADA director's meeting on Tuesday, March 25, 2003, and reported that the directors did not wish to support the bill. They wanted to drop the existing amendments and create a new bill when there is more time to review each individual legislative amendment. He indicated the KADA directors did not understand why the Council was in such a hurry to make changes to the existing Trust Fund Act. Mr. Polak asked Mr. Lee what specific pieces of the proposed amendments to the Trust Fund Act the KADA directors did not like. Mr. Lee stated that he could not respond to the specifics as they were not discussed but noted that the current officers of KADA did not take into consideration public opinion and did not do surveys of the KADA members before submitting and supporting the proposed amendments at the Council's February 28, 2003 Council meeting. Mr. Lee indicated he has no idea exactly what the KADA directors do not like in the proposed amendments. Mr. Polak replied that he was disappointed with KADA's position as it will hurt the industry and individual drycleaners and most likely will require that the Council take action to increase Fund revenues sooner rather than later. In addition, it will provide no incentive for using green solvents, there will be no amnesty period to allow almost 550 drycleaners, the majority who are Korean, to be eligible for remedial benefits and it will not provide an extension of the program sunset date to allow the additional timeframe to raise the necessary revenue to pay for the drycleaning facility cleanups. He noted that hopefully the legislation will pass in spite of KADA's last minute rejection of the proposed amendments. He stated the amendments are needed more today than when the bill was initially crafted due to the larger number of sites requiring cleanup. He noted this is particularly frustrating when the Council has worked so hard to accommodate all interested parties' recommendations, and then at the last minute receives opposition from an organization that has been participating in the process for a lengthy period of time. He reiterated that was particularly frustrating with KADA opposing the language that they had previously submitted without providing specifics of what they are opposed to. Mr. Bredenkamp agreed with Mr. Polak that he was very disappointed in KADA as he also felt the Council has worked hard with all associations, particularly the KADA in adopting the changes that they had requested. Mr. Gibson asked Mr. Lee how KADA's rejection of HB1553 came about when the Council spent the better part of the February 28, 2003 Council meeting reviewing KADA's recommendations and agreeing to every one. Mr. Lee reported that Mr. Sung Do Kang, president of KADA, did not go over each of the amendments with all of the members and that the directors did not understand the proposed amendments at the time it was initially presented by Mr. Kang to the Council. Mr. Chung took exception with Mr. Lee's comment, noting that the KADA directors approved and authorized the KADA Environmental Committee with the authority to review and agree to changes to the Trust Fund Act. Mr. Lee disagreed with Mr. Chung, stating that it was most important that any changes be taken back to the KADA members for their review and support. Mr. Polak asked if KADA wanted to kill the bill. Mr. Lee replied that KADA would not support the legislative changes, that they will send letters to the state representatives and senators, asking them to defeat any changes to the Trust Fund Act. Mr. Gibson asked Mr. Sink if the South Suburban Drycleaners Association supports the Council's proposed amendments. Mr. Sink stated that South Suburban has not taken any votes on the proposed changes but that he is personally opposed to the amendments. Mr. Polak asked, "Is the bill better than it was?" Mr. Sink replied that he wasn't certain. He noted that the bill and the Fund never talked about the cost impact on drycleaning businesses. For example, he just became aware that if you conduct a site investigation and the facility tests clean, that you personally pay for all of the site investigation costs without any reimbursement from the Fund. Mr. Gibson replied that that is the best deal in the world in that you know your facility is clean and you don't have to go through the cleanup process. Mr. Polak stated that it is his observation that everyone would like the revenue or cost of the program to stay the same but the rest of the program, including benefits, to get better. Mr. Jim Rusciolelli, speaking on behalf of the Illinois State Fabricare Association (ISFA) defended Mr. Kang, stating that prior to Mr. Kang being elected president, the KADA had spent $80,000 in lobbying for legislation. ISFA had spent $40,000 in lobbying for legislation, with nothing being accomplished. Since Mr. Kang has been in office, the industry, in particular KADA and ISFA have worked together to try to improve the Trust Fund Act without creating another war within the industry. Mr. Rusciolelli stated that as president of ISFA, he was elected to represent the interest of the association and has done so. He noted that ISFA members have not voted on the proposed amendments but as a whole, ISFA is in support of the bill. It contains significant technical corrections and has broad based amendments that assist all drycleaners within the industry and he gave credit to the Council for proactively trying to improve the Act. The Council has a direct voice to the governor and applauded them for taking the lead on this difficult issue. If the Council missed the deadline for getting this bill passed, then they will have to wait until next year and who knows what problems will exist at that time and he hoped that everyone opposed to the bill would reconsider their position in the very near future. He reiterated the Council has done their job and that ISFA is willing to work with Mr. Lee and any other KADA directors or officers to try and resolve the differences. Mr. Sink stated both Dr. Chweh and Mr. Lee have indicated that the Council should hold back on moving ahead at a quick pace on legislative amendments and maybe it would be better to try to initiate something for consideration during the Legislature's veto session. He also questioned, has ISFA every polled their members on what they believe? Mr. Rusciolelli replied that the ISFA newsletter informed the members of ISFA's position and he typically does not get any responses from their members on the Association's position. Mr. Polak stated the Speaker of the House had two (2) questions on the proposed amendments, one dealing with the composition of the Council and the second with the extension date of the sunset period. Mr. Polak polled each of the Council members individually with each indicating they feel strongly that the current makeup of the Council should remain the same and that the Council position designations should not be removed from the bill so that the program continues to be the best for the drycleaners and is governed by drycleaners. Mr. Polak replied that this information would be conveyed to the governor's office. He commented that he, the Administrator and several other Council members would be meeting on Friday with Rep. Smith and a representative of the governor's office to update them on the status of the Trust Fund Program.
	B.	Classification of New Solvents For Solvent Taxing Purposes:
		Mr. Eriksen reviewed with the Council that the Administrator's office has become aware of several types of new drycleaning solvents that are being used in Illinois that have not been previously been classified as either a chlorine-based or hydrocarbon-based solvent for solvent taxing purposes. The new solvents are as follows: • PureDry • Sur Dri • Kwik Dry Mr. Eriksen stated he is asking the Council to make a determination on the classification of these three (3) solvents for taxing purposes. He noted PureDry is manufactured by NIRAN Technologies, Inc. of West Orange, NJ. A review of a material safety data sheet (MSDS), that was provided under a confidentiality agreement, indicated that this solvent should be classified as a hydrocarbon solvent for taxing purposes. Sur Dri is manufactured by Citgo Petroleum Corp. and a review of the MSDS indicates that it is a member of the petroleum hydrocarbon solvent family. The MSDS composition information reflects 100% stoddard solvent and 100% hydrotreated light distillate petroleum. It is the Administrator's recommendation that this solvent also be classified as a hydrocarbon solvent for taxing purposes. Kwik Dry is manufactured by Calumet Lubricants Co. and a review of the MSDS indicates that its composition is a 100% concentration of hydrotreated light distillates. The Administrator recommends this solvent be classified as a hydrocarbon solvent for taxing purposes. Mr. Kim indicated a concern in classifying these solvents as hydrocarbon as they may impact the funding of the program. Mr. Eriksen stated that it would not impact the funding as based on the current definition of the Act, these all are solvents that primarily contain hydrocarbons and therefore should be classified as such. If the legislature passes the Council's legislative package it would create a new category of "green" solvents. The Council, at a future date, would want to review if any of these three (3) solvents would meet the definition of a "green" solvent. For the time being, the Council can only classify them within the context of the current Act. On a motion by Mr. Bredenkamp and a second by Mr. Lewicki, the Council voted to treat all three (3) of the above referenced solvents as hydrocarbon based solvents for solvent taxing purposes. The motion passed by a vote of 6-0.
	C.	Review of Site Investigation Boring Statistics:
		Mr. Eriksen noted that since Dr. Chweh was ill and absent from the meeting, that the Council consider deferring discussion of the analysis of site investigation statistics until the next meeting as Dr. Chweh had been the one who wanted additional information regarding site investigation borings and at what depth contamination was discovered at the drycleaning facility. It was a consensus of the Council members to defer discussion of this topic until the next meeting. Mr. Polak recessed the meeting at 11:20 a.m. and reconvened at 11:35 a.m.
	E.	Presentation of Remediation Technologies and Report on Vendor Technical Meeting:
		Dr. Juho So gave a 40-minute Power Point presentation to the Council on various remedial technologies. They included soil excavation, soil vapor extraction, pump and treat (multi-phase extraction) air sparging, chemical oxidation, bio-remediation, thermal technology and passive remediation. The Council had numerous questions regarding the technologies. Mr. Perkins and Dr. So briefly reviewed with the Council the results of the innovative technology seminar that the Council sponsored on February 19, 2003 at the Holiday Inn in Naperville, IL. Four (4) vendors presented their technologies at the seminar and the topics included technical information, the benefits of the technology, how it may be applied to drycleaner facilities and the projected cost to clean up drycleaner facilities for each technology. The vendors who presented were as follows: 1. MECX, whose technology involved chemical oxidation (hydrogen peroxide and Fenton's reagent. 2. Accelerated Remediation Technologies, whose technology was groundwater recirculation and in-well air stripping. 3. Regenesis, whose technology was bioremediation with a hydrogen-releasing compound. 4. Carus Chemical, whose technology was chemical oxidation with permanganate. Dr. So noted that several of the technologies are being tested on drycleaning facilities in Illinois at this time. He indicated that the Administrator would keep the Council informed as to the successes and failures as these technologies are tried in Illinois.
	APPEAL OF LICENSE LATE PAYMENT PENALTY
	Mr. Ankil Patel, who operates Brookdale Cleaners, Site #0001067, in Naperville, IL, addressed the Council regarding his appeal of a late payment penalty for the calendar year 2002 annual license fee, in the amount of $465. Mr. Patel indicated that he had contacted the Fund in March 2001, when he had taken over the facility, regarding the transfer of the license from the then current owner, Mr. Mannish Patel, to himself. He stated he did not hear from the Fund on the information nor was he aware that the 2002 license fee was due and payable until he called the Administrator in February 2002 to check on the status of his license transfer. He indicated that he paid the fee as quickly as he could after he became aware that it was due for 2002 and that is should be waived as it is really confusion in the Administrator's office regarding the ownership transfer that created him to be late with his payment. Mr. Eriksen reviewed for the Council his memorandum contained in the packet, noting that the Administrator's office had sent the Transfer Form to Mr. Mannish Patel on several occasions. The form was not completed. In addition, a licensing application was mailed to the facility in November 2001, indicating that a renewal for 2002 was needed. A second mailing was conducted in February 2002. After discussion by the Council, on a motion by Mr. Polak and a second by Mr. Gibson, the Council, by a vote of 6-0, agreed to waive the late payment penalty for calendar year 2002, in the amount of $465, as they believed that Mr. Patel had acted in good faith effort to transfer the prior license. It was suggested that the Council consider requiring all transfer papers be handled via certified mail.
	APPROVAL OF PROGRAM BILLINGS
	Mr. Eriksen noted that there were two (2) bills requiring Council review and action:
	1. Williams & Company Consulting, Inc $ 61,261.00 Standard flat fee billing for February 2003, licensing, underwriting and claims processing.
	2. John J. McCarthy $ 3,322.50 Professional legal services to the Council for the period of February 5, 2003 through March 17, 2003.
	On a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the bills were approved by a vote of 6-0.
	MONTHLY ACTIVITY REPORT AND FINANCIALS REVIEWED
	Mr. Eriksen reviewed the February 2003 monthly activity report with the Council, noting there are approximately 1,250 drycleaners currently licensed and approximately 341 out of 950 eligible drycleaners have either tested or sought budget approval for testing their drycleaning facility. The Council had a brief discussion on the likelihood of how may more drycleaners would be able to obtain budget approval and complete their initial site investigation prior to the June 30, 2004 deadline. Mr. Eriksen reviewed the February 28, 2003 financial statements noting that the Fund balance as of February 28, 2003 was $6,763,324. Mr. Chung inquired about the allowance for uncollectible receivables. Mr. Eriksen replied this relates to license late payment fees that had been agreed to by the drycleaner operator and incorporated in an installment note. Several of the drycleaners who signed the installment agreements have gone out of business and have defaulted on their installment agreements. The Administrator is investigating the cost of hiring a collection agency to collect the overdue installment payments.
	APPROVAL OF CLAIM COSTS IN EXCESS OF $75,000
	Mr. Eriksen noted that the Administrator was requesting Council approval in the amount of $42,100, to implement a remedial action plan at Family Pride Cleaners in West Dundee, IL. IEPA has approved the remedial action plan and the technology utilized would treat the groundwater at the facility. Included in the write-up was technical background information that noted there are low levels of groundwater contamination that are moving very quickly to offsite locations. Mr. Perkins indicated that West Dundee does not have a groundwater ordinance. After additional discussion, on a motion by Mr. Lewicki and a second by Mr. Bredenkamp, the Council approved the budget of an additional $42,100 by a vote of 6-0.
	OTHER ISSUES AS PRESENTED
	Mr. Eriksen noted the appropriation letter received from the Bureau of the Budget and a letter of concern on the insurance premium increase from a drycleaner.
	PUBLIC COMMENT PERIOD
	Mr. Chang Lee stated that many drycleaners think the license fee is the same as the insurance premium and therefore, once they have obtained their license, they should also have insurance from the Fund. Mr. Eriksen stated that the Council has had numerous seminars, meetings and mailings since the program's inception and most meetings had poor attendance. Until recently, KADA did not invite the Council to provide presentations on the issues at their meetings. Mr. Lee noted that Illinois is the only state that requires insurance. Mr. Eriksen replied that is correct and explained the relationship between the insurance program and the remedial program. Mr. Polak noted that he has been in contact with reinsurers who have no interest in the remedial fund due to the higher frequency of contamination discovered but there is some interest in possibly providing reinsurance to the insurance fund. Mr. Sink replied with the insurance there is a "but" that puts a hook into the program. Mr. Eriksen reiterated how the insurance program ties into the remedial program and the benefits. General discussion focused that if people pay in, they should get benefits regardless of the need for insurance. Mr. Sink thanked the Council for allowing input and appreciated Dr. So's comments on United Cleaners. Mr. Bob Soni, Northern Environmental, stated that he has emailed his opinion to the Administrator within the past week on the Fund not allowing a markup on subcontractors cost. He stated this is a typical practice within the industry and markups have been allowed by the Illinois Underground Storage Tank Fund Program. Mr. Polak requested Mr. Eriksen to bring the issue to the next Council meeting for additional discussion. The Council tentatively established Tuesday, April 29, 2003 at 9:30 a.m. at the Holiday Inn in Naperville for their next meeting. There being no further business, the meeting adjourned at 1:25 p.m.
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