The Drycleaner Environmental Response Trust Fund Council was created under the Drycleaner Environmental Response Trust Fund Act (Act). The Act was established to protect the health and safety of the citizens and natural resources of the State of Illinois.

The Act requires the Council to be audited annually by the Auditor General. This is the first audit of the Council, since the fiscal year 1999 represents its initial year of operation.

The Council was unable to determine whether drycleaners were paying the proper amount of annual license fees.

The license fees are set at $500, $1,000 or $1,500 depending on the number of gallons of drycleaner solvent purchased in the preceding license year. A license application has been developed that requires the drycleaner operator to indicate which fee category is applicable. However, Council representatives stated they do not have a cost-effective method to verify that the operator has properly completed the application and remitted the appropriate fee.

For 1999 the Council licensed approximately 1,300 drycleaner facilities, of which approximately 1,100 (85%) paid license fees at the $500 level. (Finding 1, pages 12 - 13).

The Council accepted our recommendation to implement additional procedures to verify solvent purchases. The Department of Revenue collects a tax on drycleaner solvent sales; however, the seller of the solvent rather than the purchaser (the drycleaner operator) remits the tax. The Council said it has submitted a request to the Department of Revenue that it require the collectors of the tax to list the gallonage of solvent sold to individual drycleaner operators.

Our auditors stated the financial statements of the Drycleaner Council State Trust Fund as of June 30, 1999, and for the year then ended are fairly presented in all material respects.

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WILLIAM G. HOLLAND, Auditor General

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Our special assistant auditors for this audit were Sikich Gardner & Co, LLP.