TRANSMITTAL LETTER FOR BOARD MEETING OF JUNE 18, 2026
COMMITTEE ON JUDICIARY
Mr. John P. Murray, Executive Director
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Authority to settle administrative proceedings related to A-F Acquisition, LLC d/b/a Pullman Innovations, including the Show Cause Proceedings captioned Metropolitan Water Reclamation District of Greater Chicago v. A-F Acquisition, LLC d/b/a Pullman Innovations, Case No. 25B-005, and the Administrative Appeal captioned In re: A-F Acquisition, LLC d/b/a Pullman Innovations’ Appeal of Denial of Discharge Authorization Request, Case No. 25B-006, and approve the Agreed Order of Settlement issued by the Board-appointed Hearing Officer
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Dear Sir:
A-F Acquisition, LLC d/b/a Pullman Innovations (“Pullman”) operates a vegetable oil processing and distribution facility located at 2701 East 100th Street in Chicago, Illinois (“Facility”), where it had authority pursuant to a Discharge Authorization (“DA”) from the District to discharge process wastewater into the local sewer connected to the District’s sewerage and treatment facilities. The DA prohibits the discharge of process wastewater that exceeds any of the pollutant concentration limits contained in the Sewage & Waste Control Ordinance (“SWCO”) and a limit for Total Phosphorus (“TP”) contained as a special condition in the DA.
Based on sampling events that occurred between February 2025 and August 2025, the District issued multiple Cease & Desist Orders (“C&Ds”) to Pullman for Facility discharges that exceeded the DA’s limits of TP and Fats, Oils, and Greases (“FOG”).
The DA expired on November 30, 2025. Prior to the DA’s expiration, Pullman submitted a Discharge Authorization Request (“DAR”) seeking to renew the DA for an additional term. On November 26, 2025, the District denied Pullman’s request due to the Facility’s repeated failure to comply with the pollutant concentration limits contained in the DA and SWCO. On November 28, 2025, Pullman appealed the denial of the DAR (“Pullman’s Appeal”). Under SWCO, Pullman is authorized to continue discharging to the District subject to the terms and conditions of its expired DA until such time as Pullman’s Appeal has been fully adjudicated.
On December 10, 2025, the District initiated Show Cause proceedings against Pullman based on Pullman’s violations of SWCO from February 2025 to August 2025 (“Show Cause Proceedings”). The Board-appointed Hearing Officer consolidated Pullman’s Appeal and the Show Cause Proceedings.
At a Pre-Hearing Conference in the consolidated proceedings, Pullman advised that it had invested over $3 million the past two years to upgrade the Facility’s pretreatment facilities to meet the pollutant concentration limits contained in the expired DA and SWCO. Pullman advised that its upgraded pretreatment system has been in continuous operation since December 2, 2025. District sampling has confirmed that from December 2, 2025 to the present, the Facility’s wastewater discharges have met the pollutant concentration limits contained in the expired DA and SWCO.
In total, Pullman’s violations comprise 132 separate days from February 26 to December 1, 2025, when the Facility’s discharges exceeded the discharge limits contained in the expired DA and SWCO. While all of these daily violations concern exceedances of the pollutant concentrations limits contained in the expired DA, the violations were of greater magnitude on 93 of those days. This includes 92 days when Pullman exceeded the daily loading limits for TP contained in the expired DA, meaning the mass of TP received by the District was greater on those days, and 1 day when Pullman’s exceedance for FOG was more than five times SWCO’s local limit.
Following extensive negotiations that also allowed the District to confirm Pullman’s continued compliance with the expired DA and SWCO, the parties agreed to the terms of an Agreed Order of Settlement (“Agreed Order”), which provides:
1) Pullman will pay $225,000.00 in civil penalties to the District, comprising the maximum allowable daily civil penalty available under SWCO of $2,000 per day for the 93 days mentioned above, and $1,000 per day for the remaining 39 daily exceedances.
2) Pullman will reimburse the District for court reporter and Hearing Officer costs in the amount of $2,063.77.
3) Pullman will pay the District all outstanding User Charges owed pursuant to the District’s User Charge Ordinance and all Noncompliance Enforcement Charges and Late Filing Fees owed pursuant to SWCO.
4) Pullman will continue maintaining the Facility’s pretreatment system so that it is functioning properly and achieving compliance with SWCO.
5) Subject to SWCO’s requirements for DARs, a new 1-year DA will be issued for the Facility, which will contain a more stringent limit for TP, an amount more than 15 times lower than the limit for TP contained in the expired DA.
6) The Hearing Officer will retain jurisdiction over this consolidated case for a period of three years following the date that the Board approves the Agreed Order, with the District having leave to reinstate the case if, during such time, Pullman violates the effluent exceedance provisions contained in the Agreed Order.
The Monitoring and Research Department (“M&R”) and Law Department worked closely to effectuate a settlement on terms and conditions favorable to the District, and Pullman has agreed to these terms. The Board-appointed Hearing Officer reviewed the agreement, determined that it was appropriate and electronically signed and issued the Agreed Order, which is subject to Board approval.
Accordingly, the General Counsel respectfully requests that the Board of Commissioners authorize a settlement in the administrative proceedings related to A-F Acquisition, LLC d/b/a Pullman Innovations, including the Show Cause Proceedings captioned Metropolitan Water Reclamation District of Greater Chicago v. A-F Acquisition, LLC d/b/a Pullman Innovations, Case No. 25B-005, and the Administrative Appeal captioned In re: A-F Acquisition, LLC d/b/a Pullman Innovations’ Appeal of Denial of Discharge Authorization Request, Case No. 25B-006, and approve the Agreed Order of Settlement issued by the Board-appointed Hearing Officer.
Requested, Susan T. Morakalis, General Counsel, STM:CMM:ATF:jc
Disposition of this agenda item will be documented in the official Regular Board Meeting Minutes of the Board of Commissioners for June 18, 2026
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