Color Communications, Inc. v. Pollution Control Board , 288 Ill. App. 3d 527 ( 1997 )

                               NO. 4-96-0657

                          IN THE APPELLATE COURT

                                OF ILLINOIS

                              FOURTH DISTRICT

COLOR COMMUNICATIONS, INC.,              )  Administrative

         Petitioner,                    )  Review of the

         v.                             )  Illinois Pollution

THE ILLINOIS POLLUTION CONTROL BOARD and )  Control Board

THE ILLINOIS ENVIRONMENTAL PROTECTION    )  No. 96-125

AGENCY,                                  )  

         Respondents.                   )  

_______________________________________________________________

         PRESIDING JUSTICE STEIGMANN delivered the opinion of

the court:

         Petitioner, Color Communications, Inc. (CCI), appeals

from an order of respondent Illinois Pollution Control Board

(Board), which affirmed an administrative decision by respondent

Illinois Environmental Protection Agency (Agency), denying sepa-

rate "Clean Air Act Permit Program" (CAAPP) permits for CCI's two

Chicago plants.  Color Communications, Inc. v. Illinois Environ-

mental Protection Agency, Ill. Pollution Control Bd. Op. 96-125,

at 17 (July 18, 1996).  CCI contends that the Board erred by

determining that CCI's two Chicago plants constituted a single

source for the purposes of the CAAPP.  We agree and reverse and

remand.

                             I.  BACKGROUND

         CCI produces color systems, samples, color boards, and

color marketing systems for paint, automotive, and other indus-

tries.  It has manufacturing facilities in Chicago and other

domestic and foreign locations.  Its two Chicago facilities are

located at 4000 West Fillmore Street (hereafter the 4000 plant)

and 4242 West Fillmore Street (hereafter the 4242 plant).  These

two facilities are separated by more than a full city block.

Another company, Ribbon Webbing Corporation (Ribbon), which is

wholly unconnected to CCI, owns a manufacturing plant and offices

in the city block between CCI's two plants.  

         The 4242 plant houses color-mixing operations and

paint-coating lines and produces coated substrates, including

paper and plastic.  This plant sends color bases and colorants it

produces to other CCI facilities, including the 4000 plant and

plants in New York and New Zealand.  The 4000 plant houses

printing and assembly operations and warehousing and shipping

functions.  More than half of the printing and assembly of color

boards at the 4000 plant involves the use of coated substrates

provided by the 4242 plant.  However, many of the 4000 plant's

printing activities involve materials obtained from customers and

third-party vendors, not materials produced at the 4242 plant.

         Because the two plants perform different operations and

use different raw materials, their pollutant-emitting activities

are classified differently under the Standard Industrial Classi-

fication (SIC) Manual.  The first two digits of the code desig-

nate the major industrial grouping to which each plant belongs.

The 4000 plant's pollutant-emitting activities are classified as

group 2759 (27 is the SIC code for "commercial printing not

elsewhere classified").  The activities at the 4242 plant are

classified as group 2672 (26 is the SIC code for "paper coating

not elsewhere classified").  The CCI plants have had these SIC

classifications for at least five years.  The Agency does not

question the appropriateness of the different SIC codes assigned

to the two plants.

         The 1990 amendments to the federal Clean Air Act (CAA)

(42 U.S.C. §7401 et seq. (1988)) required states to establish

permitting programs for air pollution sources.  Clean Air Act

Amendments of 1990, Pub. L. No. 101-549, 104 Stat. 2399, 2404

(1990).  The CAAPP (see 415 ILCS 5/39.5 (West 1994)) establishes

permitting requirements for certain sources of air pollutants

regulated pursuant to the CAA.  The Agency administers the CAAPP.

CCI's Chicago plants are subject to the CAAPP because they are

located in a severe nonattainment area and each has the potential

to emit 25 or more tons per year of volatile organic material.

See 415 ILCS 5/39.5(2)(a), (2)(c)(iii)(A) (West 1994).  The 4242

plant emits more than 25 tons per year of volatile organic

material, and the 4000 plant emits approximately 10 tons per year

of volatile organic material.  

         The Agency issued an air operating permit to the 4242

plant in 1979 and renewed the permit in 1983, 1988, and 1994.  In

1989, CCI acquired the 4000 plant (from a company with which CCI

was not associated in any way), and in 1994, the Agency issued an

air operating permit for that plant.  In 1995, the Agency issued

a joint construction and operating permit for certain additional

emission units at the 4000 plant.  Each of these permits treated

the two plants as separate, independent facilities.

         In September 1995, CCI submitted separate CAAPP appli-

cations to the Agency for CCI's two Chicago plants.  In November

1995, the Agency issued a "Notice of Incompleteness"--a form of

permit denial--advising CCI that the two plants must be consid-

ered one "source" for purposes of CAAPP permits.  The notice

stated:

         "The Agency has previously learned that oper-

         ations at both of CCI's locations include

         pollutant[-]emitting activities that belong

         to the same industrial grouping, are located

         on one or more contiguous or adjacent proper-

         ties[,] and are under common control.  Be-

         cause the locations together constitute a

         single CAAPP source, CCI cannot seek recogni-

         tion for each of its locations of operation

         as a separate CAAPP source."

The Agency then informed CCI that it must submit only one CAAPP

application that treated both plants as a single "source."

         CCI appealed the Agency's decision to the Board,

arguing that the two plants constituted separate, independent

sources pursuant to the CAAPP.  In July 1996, the Board affirmed

the Agency's decision (with two Board members dissenting), agree-

ing that the two plants constituted the same "source" under the

CAAPP.  

                              II.  ANALYSIS

         CCI appeals, arguing that the Board's decision con-

flicts with applicable state and federal statutes and regula-

tions.  Specifically, CCI contends that the Board erred by

concluding that the two plants constitute a single source when

statutes and regulations require separate permits for sources of

emissions that (1) did not belong to the same industrial grouping

because they are classified by different SIC codes, and (2) are

located on properties that are neither contiguous nor adjacent.

                         A.  Standard of Review

         Section 3-110 of the Code of Civil Procedure (735 ILCS

5/3-110 (West 1994)) governs review of final administrative deci-

sions, providing in part that, in an action for review, "[t]he

hearing and determination shall extend to all questions of law

and fact presented by the entire record before the court."  In a

case involving the legal effect of undisputed facts, as here, the

issue is a matter of law, and we review it de novo.  Denton v.

Civil Service Comm'n, 277 Ill. App. 3d 770, 773, 661 N.E.2d 520,

524 (1996).  

         The primary rule in statutory construction is to give

effect to legislative intent.  First of America Bank, Rockford,

N.A. v. Netsch, 166 Ill. 2d 165, 181, 651 N.E.2d 1105, 1112

(1995).  Ordinarily, the statutory language provides the best

indicator of legislative intent, and where that language is plain

and unambiguous, courts must give it effect without considering

other indicia of legislative intent.  First of America, 166 Ill.

2d at 181, 651 N.E.2d at 1112.  

         Generally, courts give a great deal of deference to an

agency's interpretation of a statute that it is charged with

administering.  City of Decatur v. American Federation of State,

County, & Municipal Employees, Local 268, 122 Ill. 2d 353, 361,

522 N.E.2d 1219, 1222 (1988); Denton, 277 Ill. App. 3d at 774,

661 N.E.2d at 524.  However, an agency's interpretation is not

binding and will be rejected if erroneous.  City of Decatur, 122

Ill. 2d at 361, 522 N.E.2d at 1222.

                      B.  Description of the CAAPP

         The CAAPP provides that any major source of air pollu-

tion must apply for a CAAPP permit.  415 ILCS 5/39.5(2)(a)(i)

(West 1994).  Section 39.5(1) of the Environmental Protection Act

(Act) defines "source" as follows:

              "'Source' means any stationary source

         (or any group of stationary sources that are

         located on one or more contiguous or adjacent

         properties, and are under common control of

         the same person or persons ***) belonging to

         a single major industrial grouping.  For the

         purposes of defining 'source,' a stationary

         source or group of stationary sources shall

         be considered part of a single industrial

         grouping if all of the pollutant[-]emitting

         activities at such source or group of sources

         on contiguous or adjacent property belong to

         the same Major Group (i.e., all have the same

         two-digit code) as described in the Standard

         Industrial Classification Manual, 1987."

         (Emphasis added.)  415 ILCS 5/39.5(1) (West

         1994).

Thus, for the two plants in this case to be considered a single

source, they must (1) be under common control by the same entity;

(2) be on contiguous or adjacent property; and (3) belong to a

single major industrial grouping.  Sources belong to a single

major industrial grouping when they have the same two-digit SIC

code.  No party disputes that CCI owns and operates both plants.

                            C.  The SIC Codes

         CCI contends that the Board erred by concluding that

the two plants constituted a single source even though they were

classified under different two-digit SIC codes.  We agree.

         The Board does not dispute that the two plants have

different SIC codes, nor does it contend that the codes should be

changed.  Nevertheless, the Board concluded that the plants

should be treated as a single "source" despite the fact that

their individual operations have different SIC codes because the

4242 plant "supports" the 4000 plant by providing raw materials.

The Board explained this conclusion as follows:

              "The Board finds it proper under

         [s]ection 39.5 of the Act to apply the sup-

         port[-]facility concept when determining

         whether two or more facilities are within the

         same major industrial grouping.  ***  [T]his

         conclusion is supported by the fact that the

         CAAPP's definition of 'source' shares the

         language[] and history[] of the federal defi-

         nition.  Additionally, *** in order to avoid

         imposing contradictory obligations upon the

         Agency, the support[-]facility analysis must

         be included ***."

         The Board's decision relies on the fact that (1)

federal law allegedly incorporates the support-facility concept

into the federal definition of "major source"; and (2) Illinois

law parallels federal law and section 39.5(3)(a) of the Act ex-

pressly requires that the CAAPP must be consistent with federal

law, providing as follows:  "The Agency shall issue CAAPP permits

under this [s]ection consistent with the [CAA] and regulations

promulgated thereunder and this Act and regulations promulgated

thereunder."  415 ILCS 5/39.5(3)(a) (West 1994).

         The Board contends that federal law incorporates the

support-facility concept into its definition of "major source"

based on (1) language found in the preamble to a proposed federal

regulation, which preamble was never adopted (45 Fed. Reg. 52,676

(1980) (preamble to the Prevention of Significant Deterioration

regulations); and (2) the testimony of Ronald Van Mersbergen, a

national air permitting expert, who testified that the federal

Environmental Protection Agency employs the support-facility

concept when determining whether two facilities fall under a

single major industrial grouping.

         In this case the plain language of the statute, as set

forth above, clearly requires that if several stationary sources

have the same two-digit SIC code, they must be considered to

belong to a single major industrial grouping.  Accordingly, an

industrial grouping is defined by SIC codes.  A plain reading of

this statute is that if several stationary sources do not have

the same two-digit SIC code, they do not belong to the same

industrial grouping.

         Where a statute is clear and unambiguous, as this one

is, a court is not at liberty to depart from its plain language

and meaning by reading into it limitations or conditions that the

legislature did not express.  Solich v. George & Anna Portes

Cancer Prevention Center of Chicago, Inc., 158 Ill. 2d 76, 83,

630 N.E.2d 820, 823 (1994).  By relying on the support-facility

concept, the Board improperly looked beyond the unambiguous

language of the statute to determine whether the two plants

belonged to a single industrial grouping.  Accordingly, the Board

erred in concluding the plants constituted a single "source" for

CAAPP purposes.

                            III.  CONCLUSION

         Because we hold that the two plants do not belong to a

a single major industrial grouping, we need not resolve whether

they are "adjacent" within the meaning of the statute.

         For the reasons stated, we reverse the Board's decision

and remand for further proceedings consistent with this opinion.

         Reversed and remanded.

         GARMAN and COOK, JJ., concur.