[Senate Hearing 109-1046]
[From the U.S. Government Publishing Office]
S. Hrg. 109-1046
EPA REGIONAL INCONSISTENCIES
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON
ENVIRONMENT AND PUBLIC WORKS
UNITED STATES SENATE
ONE HUNDRED NINTH CONGRESS
SECOND SESSION
__________
JUNE 28, 2006
__________
Printed for the use of the Committee on Environment and Public Works
Available via the World Wide Web: http://access.gpo.gov/congress.senate
__________
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COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
ONE HUNDRED NINTH CONGRESS
SECOND SESSION
JAMES M. INHOFE, Oklahoma, Chairman
JOHN W. WARNER, Virginia JAMES M. JEFFORDS, Vermont
CHRISTOPHER S. BOND, Missouri MAX BAUCUS, Montana
GEORGE V. VOINOVICH, Ohio JOSEPH I. LIEBERMAN, Connecticut
LINCOLN CHAFEE, Rhode Island BARBARA BOXER, California
LISA MURKOWSKI, Alaska THOMAS R. CARPER, Delaware
JOHN THUNE, South Dakota HILLARY RODHAM CLINTON, New York
JIM DeMINT, South Carolina FRANK R. LAUTENBERG, New Jersey
JOHNNY ISAKSON, Georgia BARACK OBAMA, Illinois
DAVID VITTER, Louisiana
Andrew Wheeler, Majority Staff Director
Ken Connolly, Minority Staff Director
(ii)
C O N T E N T S
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Page
WEDNESDAY, JUNE 28, 2006
OPENING STATEMENTS
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma... 1
Jeffords, Hon. James M., U.S. Senator from the State of Vermont.. 4
Obama, Hon. Barack, U.S. Senator from the State of Illinois...... 25
Warner, Hon. John W., U.S. Senator from the Commonwealth of
Virginia....................................................... 12
WITNESSES
Nakayama, Grant, Assistant Administrator, Office of Enforcement
and Compliance Assurance, U.S. Environmental Protection Agency. 6
Prepared statement........................................... 32
Responses to additional questions from:
Inhofe................................................... 36
Jeffords................................................. 45
Voinovich................................................ 47
Paylor, David, Executive Director, Virginia Department of
Environmental Quality, Officer, Environmental Council of States 22
Prepared statement........................................... 63
Response to additional questions from Senator Jeffords....... 67
Payne, Jean, President, Illinois Fertilizer and Chemical
Association.................................................... 15
Prepared statement........................................... 49
Schaeffer, Eric, Director, Environmental Integrity Project....... 20
Prepared statement........................................... 60
Response to additional questions from Senator Jeffords....... 62
Stephenson, John, Director, Natural Resources and Environment,
U.S. Government Accountability Office.......................... 8
Prepared statement........................................... 69
Response to additional questions from Senator Jeffords....... 76
Waterman, Richard W., Chair, Department of Political Science,
University of Kentucky......................................... 18
Prepared statement........................................... 55
Response to additional questions from Senator Jeffords....... 58
Welsh, Donald, Regional Administrator, Region III, U.S.
Environmental Protection Agency................................ 7
Prepared statement........................................... 32
ADDITIONAL MATERIAL
Chart, Percentage of Total Regulated Facilities Inspected Under
the Clean Air Act During Fiscal Year 2000, by EPA Region....... 72
Document, In the United States District Court for the Southern
District of Illinois; Memorandum and Order..................... 97
Letters:
A-way........................................................ 81
Asmark Institute............................................. 82
At Arrowsmith................................................ 85
Calendonia Farmers Elevator.................................. 86
Cooperative Gas & Oil Co., Inc............................... 88
Earlville Farmer's Co-Operative; Crop Production Center...... 89
Effingham Equity............................................. 90
Har Brand Inc................................................ 91
Kohlbrecher Truck Service, Inc............................... 92
M & M Service Company........................................ 93
Mont Eagle Mills, Inc........................................ 94
Okaw Farmers COOP............................................ 95
Tarter Feed & Fertilizer..................................... 96
Table:
ECOS's Recommended Delineation of Appropriate Roles.......... 66-67
SBA-funded study; The Impact of Regulatory Costs on Small
Firms...................................................... 77
EPA REGIONAL INCONSISTENCIES
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Wednesday, June 28, 2006
U.S. Senate,
Committee on Environment and Public Works,
Washington, DC.
The committee met, pursuant to notice, at 9:30 a.m. in room
628, Dirksen Senate Office Building, Hon. James M. Inhofe
(chairman of the committee) presiding.
Present: Senators Inhofe, Warner, Jeffords, and Obama.
OPENING STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM
THE STATE OF OKLAHOMA
Senator Inhofe. The meeting will come to order. Our policy
is to start on time. We have done that 100 percent of the time
so far, so we want to keep it up.
Today we are going to take a hard look at the
organizational structure of the EPA and whether it contributes
to damaging and unfair practices against States and businesses.
I am referring to the regional structure that divides the
Agency into 10 different geographic areas, each one having
about a thousand EPA career employees. Because of this design,
the EPA regions are notoriously autonomous and have been known
to advance their own priorities and agenda.
Some regional flexibility is necessary; however, when
regions make their own determination of law we end up with 10
different sets of rules for regulated communities throughout
the country. This is unfair to similarly situated businesses
located in different regions. For example, the businesses in a
particularly aggressive region must comply with requirements
that the same businesses in another region don't have to comply
with.
The GAO will inform us of their studies on this issue and
what they believe EPA could do to address this.
We will also hear today of an example of a renegade region
whose interpretation of laws is not only contrary to national
practice and standards but has been openly questioned by
Congress and the Judicial Branch.
When District Judge Gilbert threw out the Region V
pesticide criminal case filed days before the statute of
limitations ran, he questioned the Government's judgment in
filing a case and declared the statute unconstitutionally vague
as applied. Unfortunately, this was after the defendant, Wabash
Valley, a farmer-owned co-op, had paid over $220,000 to defend
itself. The Wabash Valley, however, was willing to spend any
amount of money to keep their pesticide applicator out of jail
for allegedly ``applying pesticide in a manner inconsistent
with its labeling.''
Another troubling incident occurred this past December. The
Illinois agriculture community was shocked when Region V
determined that the entire fertilizer retail industry,
approximately 500 members, was not in compliance with the Clean
Air Act because they did not include so-called ``nurse tanks''
in their risk management plans. This Region V requirement was
never communicated to the agriculture community and is not
required in other regions.
In fact, Region V's first contact with the fertilizer
retailers was to send enforcement letters to the members who
had bothered to file the RMPs, only threatening $32,500 a day
penalties. Incredibly, these letters were mailed right before
the Christmas holidays. Consequently, it was a very difficult
thing to try to comply with.
Jean Payne, the president of the Illinois Fertilizer and
Chemical Association, is here to provide the facts of this
story, and we want to hear this. As a former businessman,
myself, I can speak to challenges of disputing the Federal
Government and bureaucracies like the EPA. It is not hard to
imagine the level of fear and uncertainty that accompanies
letters like these for the average citizen. I became aware of
this situation immediately after the fertilizer retailers
received the letter, and I opened an inquiry as chairman of the
committee of jurisdiction. I felt that someone had to do this.
We remember the other things that have happened in the
past, Senator Jeffords, when you and I sat up here and heard
the testimony of a guy named Jimmy Dunn who had a lumber
company where they were going to impose penalties on him on a
daily basis that would have put him out of business after three
generations of his family running the company, in a matter of
about 40 days.
Senator Jeffords. Yes.
Senator Inhofe. It is the fear factor that is always out
there of the bureaucracy doing something that is going to take
away your livelihood.
Finally, another important aspect that requires review when
evaluating the EPA's regions and bureaucratic factor: does the
presence of only one Administration appointee hamper effective
policy implementation? To what extent are unelected officials
setting policy in these regions? If bureaucrats are managing
the regions, how can we be sure that the public's wishes are
translated into policy and realistically implemented?
I am a firm believer that elected officials who answer to a
constituency can best manage according to the public's will.
Dr. Richard Waterman, author of the book ``Bureaucrats,
Politics, and the Environment,'' is here today to help us
understand the nuances accompanying the EPA bureaucracy and the
strength of their voice in Government today.
With unlimited resources, the EPA must be mindful of
prosecution techniques that can actually survive judicial
scrutiny. We should not hear about cases that are thrown out
with judicial commentary chastising Government for filing a
criminal case. I will continue to oversee the EPA's regional
activities to ensure that we are effectively protecting the
environment, as well as our citizens.
In a note to Mr. Schaeffer on the second panel--I am glad
to see you back here once again. You have become quite a
spokesman for the environmentalists since your departure from
the EPA in 2002 when you resigned in protest of the
Administration's policies. In your testimony you criticize the
purpose of today's hearing as being motivated by the Region V
example from last December. My staff began this oversight
initiative over a year ago, more than 6 months before the
Region V example took place. They discovered the problem in
Region V during the investigation.
It is my intention that today's hearing will be the first
in a series over the next 2 years looking at how the EPA
bureaucracy operates. I am considering field hearings at the
EPA's regional offices and legislation, if needed, to ensure
that we get measurable results in reforming the EPA's regions
in their inconsistent, detrimental approach to environmental
laws.
This is a problem. I have mentioned only Region V when, in
fact, there are problems in other regions, too. I think that a
bureaucracy can become abusive and there has to be some
consistent policy and regulations between the various regions.
That is the whole purpose of this hearing.
[The prepared statement of Senator Inhofe follows:]
Statement of Hon. James M. Inhofe, U.S. Senator
from the State of Oklahoma
Today we are going to take a hard look at the organizational
structure of the EPA and whether it contributes to damaging and unfair
practices against States and businesses. I am referring to the regional
structure that divides the Agency into 10 different geographical
regions headed by a Regional Administrator managing approximately 1,000
EPA career employees. Because of this design, EPA regions are
notoriously autonomous and have been known to advance their own
priorities and agendas. Some regional flexibility is necessary.
However, when regions make their own determination of law, we end up
with 10 different sets of rules for the regulated communities
throughout the country. This is unfair to similarly situated businesses
located in different regions. For example, businesses in a particularly
aggressive region must comply with requirements that the same
businesses in another region do not. The GAO will inform us of their
studies on this issue and what they believe EPA could do to address
this.
We will also hear today of an example of a renegade region whose
interpretation of laws is not only contrary to national practice and
standards but has been openly questioned by Congress and the Judicial
Branch. [SEE CHART] When District Judge Gilbert threw out a Region V
pesticide criminal case--filed days before the statue of limitations
ran--he questioned the Government's judgment in filing the case and
declared the statute unconstitutionally vague as applied.
Unfortunately, this was after the defendant, Wabash Valley, a farmer-
owned co-op, paid over $220,000 to defend itself. Wabash Valley,
however, was willing to spend any amount of money to keep their
pesticide applicator out of jail for allegedly ``applying pesticide in
a manner inconsistent with its labeling.''
Another troubling incident occurred this past December. The
Illinois agriculture community was shocked when Region V determined
that the entire fertilizer retail industry--approximately 500 members--
was not in compliance with the Clean Air Act because they did not
include so-called nurse tanks in their Risk Management Plans. This
Region V requirement was never communicated to the Ag. Community and is
not required in other regions. In fact, Region V's first contact with
the fertilizer retailers was to send enforcement letters to the members
who had bothered to file RMPs only, threatening fines of $32,500 per
day. [SEE CHART] Incredibly, the letters were mailed out on December 15
and gave the rural businessmen and women only 10 days to respond over
the Christmas holidays. [SEE CHART] Jean Payne, the President of the
Illinois Fertilizer and Chemical Association, is here to provide the
facts of this story.
[The referenced document can be found on pages 97-125.]
As a former businessman myself, I can speak to the challenges of
disputing the Federal Government and bureaucracies like the EPA. It is
not hard to imagine the level of fear and uncertainty that accompanies
letters like these for the average citizen. I became aware of the
situation immediately after the fertilizer retailers received the
letters and I opened an inquiry as Chairman of the Committee of
Jurisdiction. I felt that someone had to help these farmers deal with
the EPA.
Consequently, there are many important lessons we can learn from
studying the EPA regional structure and how inconsistent enforcement
impacts the regulated community, the States, and their relationship
with one another. I am interested to hear from the States'
perspective--through Dave Paylor, the Director of the Virginia DEQ--how
the EPA regions affect their ability to effectively monitor and enforce
the environmental laws.
Finally, another important aspect that requires review when
evaluating the EPA regions is the bureaucracy factor. Does the presence
of only one Administration appointee hamper effective policy
implementation? To what extent are unelected officials setting policy
in the regions? If bureaucrats are managing the regions, how can we be
sure that the public's wishes are translated into policy and
realistically implemented? I am a firm believer that elected officials
who answer to a constituency can best manage according to the public's
will. Dr. Richard Waterman, author of the book Bureaucrats, Politics,
and the Environment, is here today to help us understand the nuances
accompanying the EPA bureaucracy and the strength of their voice in
Government today.
With unlimited resources, the EPA must be mindful of prosecution
tactics that can actually survive judicial scrutiny. We should not hear
about cases that are thrown out with judicial commentary chastising the
Government for filing a criminal case. I will continue to oversee the
EPA regional activities to ensure that we are effectively protecting
the environment as well as our citizens.
And a note to Mr. Schaeffer on the second panel, glad to see you
back here once again. You have become quite a spokesperson for the
environmentalists since your departure form the EPA in 2002 when you
``resigned in protest'' of the Administration's policies. In your
testimony you criticize the purpose of today's hearing as being
motivated by the Region V example from last December. My staff began
this oversight initiative over a year ago and more than 6 months before
the Region V example took place. They discovered the problem in Region
V during the investigation.
It is my intention that today's hearing will be the first in a
series over the next 2 years looking at how the EPA bureaucracy
operates. I am considering field hearings at the EPA Regional offices
and legislation if needed to ensure that we get measurable results in
reforming the EPA regions and their inconsistent, detrimental approach
to our environmental laws.
Senator Inhofe. Senator Jeffords.
OPENING STATEMENT OF HON. JAMES M. JEFFORDS, U.S. SENATOR FROM
THE STATE OF VERMONT
Senator Jeffords. Thank you, Mr. Chairman. I share your
interest in learning more about the important patterns within
the Environmental Protection Agency. I welcome efforts to
determine whether EPA regions enforce our environmental laws
differently. But I am afraid that today's hearing will not
accomplish that goal. Instead, we are here to discuss an
isolated incident in one State. This one example tells us
little about EPA's enforcement and a lot about one case that
has pitted the regulators against those who are regulated.
We are here to discuss the plight of Illinois' fertilizer
retailers who failed to adequately file risk management plans
for the storage of dangerous chemicals. I believe we all agree
that these risk management plans are essential to aiding first
responders and protecting those who live near these facilities
in the event of an emergency. Congress should support the
Agency's efforts to administer this program.
I would hope we could expand this hearing to include
discussion about the gaps in the enforcement in many regions of
the Country. Perhaps more importantly, we should examine
whether the lack of enforcement adversely affects human health
and the environment.
We know that there must be some flexibility in EPA's
regional enforcement structure. Quite simply, some regions face
challenges that others do not. Managing this flexibility is
sometimes difficult and has likely led to inconsistent
enforcement actions within the same community. What causes
these inconsistencies? What variables affect enforcement
decisions? I asked earlier, how do those inconsistencies affect
human health and the environment?
I had hoped today to begin to answer some of these
questions. I hope that in the future hearings we may begin to
address them.
Thank you, Mr. Chairman and thanks to our witnesses for
participating here today.
[The prepared statement of Senator Jeffords follows:]
Statement of Hon. James M. Jeffords, U.S. Senator
from the State of Vermont
Thank you Mr. Chairman. I share your interest in learning more
about the enforcement patterns within the Environmental Protection
Agency.
I welcome efforts to determine whether the EPA regions enforce our
environmental laws differently. I am afraid that today's hearing will
not accomplish that goal. Instead, we are here to discuss an isolated
incident, in one State. This one example tells us little about the
EPA's enforcement, and a lot about one case that has pitted the
regulators against those who are regulated.
We are here to discuss the plight of Illinois fertilizer retailers
who failed to adequately file risk management plans for the storage of
dangerous chemicals.
I believe we all agree that these risk management plans are
essential to aiding first responders, and to protecting those who live
near these facilities in the event of an emergency. Congress should
support the Agency's efforts to administer this program.
I would hope we could expand this hearing to include a discussion
about the gaps in enforcement in many regions of this country. Perhaps
more importantly, we should be examining whether the lack of
enforcement adversely affects human health and the environment.
We know that there must be some flexibility in the EPA's regional
enforcement structure. Quite simply, some regions face challenges that
others do not.
Managing this flexibility is sometimes difficult, and has likely
led to inconsistent enforcement actions within the same community.
What causes these inconsistencies? What variables affect
enforcement decisions? And as I asked earlier, how do these
inconsistencies affect human health and the environment?
I had hoped to begin to answer some of these questions today. I
hope that in future hearings, we can begin to address them.
Thank you again Mr. Chairman, and thank you to our witnesses for
participating in today's hearing.
Senator Inhofe. Thank you, Senator Jeffords.
We are going to be joined by other members. I think that
what we have tried to do in the past, unless someone objects,
when they get here we will only submit opening statements for
the record for those who are not here on time.
On our first panel, we have Grant Nakayama. We appreciate,
Mr. Administrator, your being here. We have Donald Welsh, the
Regional Administrator of Region III; John Stephenson, Director
of Natural Resources and Environment from the GAO. We
appreciate your being here very much.
We will start with statements. Try to confine them to 5
minutes, and your entire statement will be made a part of the
record.
We will start with you, Mr. Administrator.
STATEMENT OF GRANT NAKAYAMA, ASSISTANT ADMINISTRATOR, OFFICE OF
ENFORCEMENT AND COMPLIANCE ASSURANCE, U.S. ENVIRONMENTAL
PROTECTION AGENCY
Mr. Nakayama. Thank you, Mr. Chairman. Good morning.
Mr. Chairman and members of the committee, I am Grant
Nakayama, EPA Assistant Administrator for Enforcement and
Compliance Assurance. With me today is Donald Welsh, Regional
Administrator for EPA Region III in Philadelphia. We appreciate
the opportunity to discuss how EPA ensures consistent
enforcement of Federal environmental laws throughout the United
States.
First, let me state that I believe that consistent
enforcement of our environmental laws is a very important goal.
It is my job to oversee responsible and consistent enforcement
of our environmental laws, and I take it very, very seriously.
EPA works hard to ensure a level playing field across the
country when enforcing environmental laws. Unfair disparity in
the application of the law is not acceptable, and I am
committed to working to address and reduce instances of unfair
disparity.
Second, responsible implementation of environmental laws
requires a degree of regional flexibility, as I am sure my
colleague Mr. Welsh will agree. This is a large and complex
country. We have a wide range of environmental problems,
regional and local circumstances and conditions. We cannot
dictate from Washington how every situation should be handled,
even if we wanted to. The particular issues and circumstances
are just too many and too varied.
However, there is a lot that we can do to assure a
reasonable level of consistency in the enforcement of
environmental laws, and I want to assure you we are doing that.
We use a number of tools to bring the regions together on a
common approach to enforcement. We engage in national planning
and regular communications with the regions and States to
identify the most pressing environmental problems and to agree
on how to address them. My office also issues national guidance
and policies that direct the enforcement and compliance work of
all the regions.
Do we do a perfect job? No, of course not. In a country as
diverse as ours, it is inevitable that enforcement situations
will occur that appear to be differences between the regions,
but as you consider the examples that will be offered today I
ask you to carefully consider whether you are seeing an unfair
disparity in treatment or just reasonable variations in EPA's
responses to different circumstances. Different circumstances
and varying compliance strategies do not necessarily add up to
unfair disparity in treatment, but if there is unfair disparity
in treatment we will take action to address it.
While we do not do a perfect job, I would like to mention
some of the excellent work we do. In fiscal year 2005 the
enforcement program reduced the pollution through the Nation's
air, land, and water by 1.1 billion pounds. That is the highest
total in the last 5 years and is one of the highest totals in
the Agency's history.
This year we launched a new tips and complaint website to
allow citizens to easily report potential environmental
violations. Since the site went up in January, we have seen a
significant upswing, incredible information from citizens
reporting significant environmental problems. This has allowed
EPA to focus on intentional and willful violations. The
response from citizens tells me we are on the right track.
We look forward today to discussing with you how we can
improve our program, and I would be happy to take any questions
the committee might have.
Thank you.
Senator Inhofe. Thank you, Mr. Administrator.
Mr. Welsh, did you have something to add to that or do you
have an opening statement?
Mr. Welsh. Very brief statement, sir.
Senator Inhofe. OK.
STATEMENT OF DONALD WELSH, REGIONAL ADMINISTRATOR, REGION III,
U.S. ENVIRONMENTAL PROTECTION AGENCY
Mr. Welsh. Good morning, Mr. Chairman. I am Don Welsh, the
Regional Administrator for EPA Region III. Thank you for this
opportunity to testify.
At the regional level we do often see first-hand the
importance of consistency and the value of flexibility. The
regional staff, along with our State partners, implement the
daily activities that are guided by the strategic plan,
national program guidance, and tracked through the annual
commitment system. The regions, and through them the States,
are active participants in the processes that develop and
contribute to each of these important mechanism. The inclusion
of the regions and States in a meaningful way throughout the
process increases the understanding of our shared goals and
reduces the opportunities for inconsistency.
While we strive to maintain consistent national program
implementation, flexibility is occasionally necessary to allow
us to be responsive to individual States' needs, as well as to
address issues that are unique to our specific geographic
areas. In circumstances where we feel that a different emphasis
or approach can achieve the best environmental result, we
coordinate closely with our headquarters offices, as well as
our States, to discuss options and paths forward and to avoid
surprises.
This can sometimes be a challenging task, with many
different State and local partners and perhaps several
different headquarters offices involved in implementing a
particular program. I am sure our execution is not always
seamless, but we do make every effort to avoid confusing our
partners, the regulated community, and the public.
In conclusion, at the regional level our on-the-ground and
State oversight activities necessitate that we maintain a
balance between a priority of national consistency and
occasional flexibility to address individual State needs and
unique regional circumstances.
Thank you again for the opportunity to testify. I am happy
to take your questions.
Senator Inhofe. Thank you, Mr. Welsh.
Mr. Stephenson.
STATEMENT OF JOHN STEPHENSON, DIRECTOR, NATURAL RESOURCES AND
ENVIRONMENT, U.S. GOVERNMENT ACCOUNTABILITY OFFICE
Mr. Stephenson. Thank you, Mr. Chairman and Senator
Jeffords. I am pleased to be here today to discuss our work
concerning EPA's efforts to ensure consistent and equitable
enforcement actions among its ten regions. Our testimony today
is based on many reports we have issued on EPA's compliance and
enforcement activities over the past several years, as well as
ongoing work for this committee.
EPA seeks to achieve cleaner air, purer water, and better-
protected land, in part through compliance with the Nation's
environmental laws. Enforcement is a vital part of its effort
to encourage State and local Governments, companies, and others
who are regulated to meet their environmental obligations.
Enforcement deters those who might otherwise seek to profit
from violating the law, but it is very important to ensure a
level playing field, as you heard, for regulated entities. Most
companies want to do the right thing, but they need to know
what is expected and that they will be treated consistently,
regardless of where they are located.
While the extent of inconsistencies is debatable, largely
because of the lack of data, no one disputes the fact that
EPA's ten regions vary significantly in their approach to
environmental compliance. These variations show up in key
management indicators that EPA has used in the past to monitor
regional performance, such as the number of inspections
performed at regulated facilities and the amount of penalties
assessed for non-compliance in environmental regulations.
For example, one of our past reports showed that 80 percent
of the regulated facilities in Region III, Philadelphia,
received inspections under Clean Air Act authorities, versus
only 27 percent in similar facilities in Region I, Boston, and
Region II, New York.
In addition, while our work did not focus specifically on
the effects of inconsistent enforcement, EPA's own strategic
plan notes that companies that do not comply with statutory
requirements gain an unfair advantage over companies that
invest the necessary resources to comply.
We also note that a recent study commissioned by the Small
Business Administration suggests that environmental
requirements fall most heavily on small businesses that have
proportionately fewer resources for compliance activities then
their larger counterparts.
EPA often cites, as you have heard today, regional
flexibility or difference in philosophy as the reasons for such
inconsistencies. For example, one region may choose to conduct
in-depth inspections at a fewer number of facilities instead of
conducting less-intensive examinations at more facilities. This
may be fine, but we believe and have recommended that such
variations need to be more clearly reported as part of EPA's
regional oversight process.
Further, EPA needs to clarify which enforcement actions it
expects to see consistently implemented across the regions and
direct the regions to measure and report against these core
enforcement requirements.
EPA, in effect, has somewhat competing goals in that it
wants to allow regional flexibility but also wants to ensure
consistent application of environmental laws. One can debate
the right balance for these goals, but the basic problem as we
see it is that EPA lacks sufficient data--data on the 40-plus
million entities in the regulated community, on State and
regional enforcement activities and programs, and on measures
of environmental results to accurately determine the extent of
variations and whether they, indeed, represent a problem.
In addition, EPA still lacks an adequate workforce planning
and allocation system to effectively deploy staff in a manner
that will ensure consistency in enforcing environmental
requirements. We have made numerous recommendations to EPA in
both of these areas over the past several years.
EPA, as you have heard, acknowledges that to ensure fair
and equitable treatment core enforcement requirements must be
consistently implemented so that similar violations are met
with similar enforcement responses, regardless of geographic
location. As you heard in part today--and we will hear more
from your other witnesses--EPA has several initiatives underway
to improve management information, to enhance workforce
analyses and planning, and to establish a State review
framework that will help address this problem. We are
encouraged by these initiatives, but it is too soon to tell how
effective they will be. It will take sustained top management
commitment on these new initiatives if they are to be more
successful than past initiatives.
Mr. Chairman, that concludes my statement.
Senator Inhofe. Thank you, Mr. Stephenson.
Senator Jeffords was called away to make a quorum at the
Finance Committee, and he will be right back.
I will start with you, Mr. Nakayama. You heard me in my
opening statement talk about what the judge said when he
dismissed a Region V regional criminal pesticide case. I will
actually read his statement here.
He said, ``When experienced trial lawyers decide whether to
file a lawsuit, they often look at the instructions the court
will give to a jury if the case makes it to trial. By analyzing
what he must prove to the jury, an attorney can make a
reasonable approximation of the strength of the case. The court
wonders if the Government considered this simple question. The
court has considered it and candidly it has given pause by
question.''
Now, this is the farmer-owned co-op, Wabash Valley. These
are the ones that had $220,000 they had to pay in attorneys'
fees for what I call a frivolous lawsuit. The director of
criminal enforcement, Tom Seton, at headquarters said--and this
is a quote--``There is nothing unusual about the Wabash case,
in that it provided a deterrent effect.''
Now, I guess the question I would have of you, Mr.
Administrator, is: does the EPA's goal of deterrence override
the need to file legitimate enforcement cases?
Mr. Nakayama. Thank you for the question, Mr. Chairman.
Certainly not. We need to pursue those cases which are
legitimate and we need to exercise judgment in deciding what
cases to pursue.
Senator Inhofe. You disagree with the Seton statement?
Mr. Nakayama. I think when a person says there is nothing
unusual, in our view the case involved the need to protect
human health and the environment, including ensuring that
pesticide chemicals are used carefully and properly. In this
particular case, there was evidence of repeat violations.
Pesticides actually came in contact with a neighbor.
We understand the State had previously issued penalties
concerning pesticide application at this same location. In
those cases when we believe that there is a repeat violation
and there is a need for some sort of sanction to prevent
continued application in a manner which exposes the public, we
cannot condone activities like that and we do need to take
action.
Senator Inhofe. Well, you start out by saying you do not
think it is appropriate to have gone ahead with this case, the
fact that they ended up having to pay a defense of $220,000.
Which side are you on? I am not real sure.
Mr. Nakayama. Let me clarify the answer. I don't think it
is ever in the Agency's intention nor is it in its best
interest of its law enforcement efforts to file frivolous
lawsuits. I don't believe this case was a frivolous case. Now
obviously there was a difference of opinion.
Senator Inhofe. Yes.
Mr. Nakayama. The judge felt that the standard couldn't be
met for a criminal conviction and therefore the matter was
dismissed. This difference in the view of the adequacy of the
label warning is certainly a legal question, an important
question, and one that obviously the Agency had a different
view or it would not have brought the case.
Senator Inhofe. At the beginning of your statement you
talked about you believe strongly in consistency of
enforcement, which I do, too. What have you done? You're fairly
new in the job, but what have you done to try to promote
consistency where I believe--and I think you probably believe,
judging from our discussions prior to your confirmation--that
inconsistencies are there?
Mr. Nakayama. Well, a couple things.
Senator Inhofe. What have you done to try to make that your
program, your legacy?
Mr. Nakayama. Right. Mr. Chairman, I think there are a
couple of things we have done. One of the things we have done
is strengthen our communications with the regions. We have,
obviously, regular communications with the regions about
ongoing enforcement cases.
We have also improved the coordination between our criminal
program and our civil program, because, quite frankly, I
thought that could use increased coordination because we need
to ensure that we are bringing a unified approach to
enforcement, and we need to know what the regions are doing as
well as what our criminal enforcement program is doing.
Senator Inhofe. Yes.
Mr. Nakayama. Structurally, the criminal enforcement
program is actually run out of headquarters and it is run
through our various field offices. That is run separately from
our civil enforcement program. So there is a need for better
coordination both between the civil and criminal side and
between our regions and----
Senator Inhofe. You mentioned the tips program. Is that
something you started or was that already there?
Mr. Nakayama. We had a website originally that was very
hard to get to before I came to EPA. It was buried several
levels deep in the website. We now have a direct link from the
EPA home page. The idea there was if we could get better
information we could focus our efforts on really the
intentional and willful violations if we knew about them.
Senator Inhofe. Yes. Do the tips come from citizens and
also from the regulated community?
Mr. Nakayama. Yes. They come from the public, in general,
both citizens, the public in general, non-citizens. They come
from the regulated community, such as competitors who believe
they are unfairly disadvantaged by another company's non-
compliance.
Senator Inhofe. OK. Mr. Welsh, frankly, in looking and
making evaluation of the different districts and different
regional offices, it seems to me that yours is a pretty good
model, in that I have heard a lot of complimentary things and I
think you have made a real effort to doing that. How have you
accomplished this?
Mr. Welsh. I would agree with Grant that one of the real
problems----
Senator Inhofe. Is your area around Philadelphia or----
Mr. Welsh. Correct. We are headquartered in Philadelphia,
and it is the mid-Atlantic region, six States in the mid-
Atlantic region.
Senator Inhofe. OK.
Mr. Welsh. I think one of the things that all of the
regional administrators can work hard to do is really to
emphasize the communications aspect of the work that we are
doing.
Senator Inhofe. Yes.
Mr. Welsh. When we are doing enforcement activity, we are
partners with our States and we have to coordinate with Grant's
office in headquarters, as well as the national program manager
for the particular media program, such as the Office of Water.
When we determine something through our pattern of
investigation that we think needs additional emphasis or more
work, one of the ways to avoid confusion or any concern that we
are going beyond what we ought to be doing for the sake of
national consistency is to be sure that we consult with the
folks in headquarters and make sure they know what we are
planning to do and have had an opportunity to review what we
plan to do so that there are no surprises.
I mentioned in my opening statement that I am sure our
efforts are not always seamless in that area, and it brings to
mind the monthly Monday morning conference call that we have
with the Administrator and all the AAs where the regions will
frequently report on something that they are working on or
something that they have discovered. From time to time the
Administrator or Grant or the General Counsel will say, ``Wait
a minute. I haven't heard about that yet. Before you proceed on
that, please give me a briefing and let me know what's going
on,'' or, ``Let me see that document before you do it.'' So I
think communication is one of the best ways that we can avoid
any areas where we are getting out of consistency in a way that
is harmful.
Senator Inhofe. So you are actually talking to each other?
Mr. Welsh. Yes, I think we do, a good bit.
Senator Inhofe. All right.
Senator Warner.
OPENING STATEMENT OF HON. JOHN W. WARNER, U.S. SENATOR FROM THE
COMMONWEALTH OF VIRGINIA
Senator Warner. Thank you, Mr. Chairman. This is a subject
that has interested me. It is difficult to manage. You want to
have strong individuals take over the districts and you have
got to provide them some flexibility of thinking and
management, and at the same time--and this is no reflection on
your district, Mr. Welsh, which serves my State very well, and
throughout my long period here in the Senate I have had very
good cooperation from the Philadelphia office.
But the plain fact of the matter is that there are some
problems which are common among the States that shouldn't have
variation in solution because the facts of the thing. A dam is
a dam, really, whether it is built in my State or down in
Oklahoma or wherever the case may be.
We have struggled through a dam situation. The clouds
parted this morning. A little sunshine is now coming down after
14 years working to get the permits through. It is a dam that
is badly in need for a growing community and a congested region
where the military bases are down in Norfolk and Newport News.
But she's on her way, so I don't want to jiggle the process now
that we have got it going.
You have simply got to watch how the States and the time to
get the permitting. I know, Mr. Welsh, when we were struggling
with this the infrastructure would chatter, ``Oh, you can get
this permit down in the Carolinas much quicker than you can up
out of the Philadelphia office,'' and so forth. But anyway, we
worked it through.
You have got to have a certain amount of consistency in
this permitting process because the industrial base in America
is struggling to be competitive with the world and we have got
to protect our environment and do it in such a way that we
don't put too much stress on industrial and manufacturing base
to achieve their goals and remain a competitive nation in the
world economic market.
So, Mr. Chairman, I thank you for bringing this hearing to
the attention of the full committee. Thank you very much,
gentlemen. I appreciate it.
Senator Inhofe. Thank you, Senator Warner.
Mr. Stephenson, you have testified to pretty serious
inconsistencies, and the first question I would ask you is: why
should we be concerned with inconsistencies among the regions?
Mr. Stephenson. Well, I think EPA's own strategic plan says
it best--``If you have inconsistent enforcement, some companies
may have an unfair competitive advantage over others.'' It is
not fair for a company in a region with particularly stringent
enforcement environmental laws to compete against one in a less
stringent region.
The problem is that the data doesn't exist on enforcement
actions and on the activities of the States and the regions, in
fact, to make informed decisions about the extent of the
inconsistency and what problems it actually represents. You
have heard today that flexibility is appropriate, and I agree,
but without better data you can't tell what's flexibility and
what is inconsistent enforcement.
Senator Warner. Would you yield, Mr. Chairman?
Senator Inhofe. Sure.
Senator Warner. He has struck on an important point. I
talked about that international competition, but it is
certainly State by State. How well you know that we are always
in competition between the several States for an industrial
plant, and that area which has a reputation for granting its
permits earlier is likely to get it and get the jobs that go
with it. We don't want to put that into our economic system.
Thank you for bringing that important point up.
Senator Inhofe. Mr. Stephenson, how long has this been
going on?
Senator Warner. Since we probably founded the Agency.
Senator Inhofe. I asked him.
[Laughter.]
Mr. Stephenson. That is the right answer. You know, I have
been doing this for 6 years, and it has been a prevalent
problem. It is interesting to note that the State framework
that EPA is working on now dates all the way back to a Barnes
memo back in 1986, so at least two decades that they have been
trying to address this problem. Mr. Barnes was the Deputy
Administrator during the Reagan Administration. So there have
been lots of initiatives to try to address this problem, but
they have had limited success so far.
You know, GAO is a data oriented organization, and we want
to see better data with which to measure regional performance
and State performance, and then you are in a better position to
say how much of this is inconsistency and how much of this is
flexibility.
Senator Inhofe. Senator Warner is right, it has been since
the beginning of the Agency. That is the whole reason for this
hearing. We have not, to my knowledge, at least in the last 12
years, we have not had a hearing----
Senator Warner. That is exactly right, Mr. Chairman.
Senator Inhofe [continuing]. That addresses this.
Senator Warner. You're the first chairman really to bring
this to the forefront for the whole committee, and I commend
you for it.
Senator Inhofe. I think when you hear people in the
regulated community that might have shops on the east coast as
well as in Illinois and they see the disparity, it is wrong.
I think, Mr. Stephenson, with your research and with your
efforts you could give us a lot of advice as to how to achieve
a greater consistency. Do you have anything right now you would
like to say in the way of offering a helpful solution?
Mr. Stephenson. To hark back on the data, again, better
data. There could be some 41 million plus in the enforceable
community--companies, waste water facilities, drinking water
facilities. EPA, as the DOD IG reporting just last year, simply
doesn't have a good handle on the types of facilities, the
extent that they represent a problem. If you don't have good
information on the regulated community, you don't have a good
handle on how to effectively deploy your resources. That
combined with the lack of a good workforce planning system in
EPA makes you wonder how EPA assigns enforcement resources to
the individual regions.
Senator Inhofe. You heard Mr. Welsh talk about their
communications effort and getting everyone in the same room and
communicating.
Mr. Stephenson. Right.
Senator Inhofe. I had a personal experience in that. It
happens in my State of Oklahoma we had probably the most
devastating of the Superfund sites, and have been addressing it
for some 20 years and nothing has gotten done. I found out that
it is because we never had the DOI, DOJ, Corps of Engineers,
EPA, and everybody in the same room. When we did that, we
started on the road to resolving the problem.
Do you think that what we are hearing from Mr. Welsh is
something that may be missing in some of the other regions,
specifically Region V?
Mr. Stephenson. I do. Effective communication and
coordination among the EPA staff and the State enforcers and
the regulated community is an extremely important aspect of all
of this. EPA has an oversight role of State enforcement. So
they have to do some duplicative inspections of facilities to
ensure that the States are doing it right on the one hand, but
on the other hand you don't want to see EPA regions
overstepping the bounds of the State enforcers who work the
lion's share of the Federal environmental programs.
Let's face it. The States have over 90 percent of the
responsibility for inspections, et cetera. So you don't want to
see EPA coming in after them and overstepping the State
enforcers and redoing an inspection. EPA needs to communicate
with the States what they are doing, and with the regions, and
make sure the regions toe the line and are accountable.
Senator Inhofe. What do you think about that, Mr. Nakayama?
Mr. Nakayama. I do agree. I think better communications
would aid in ensuring consistency, because if there is no
communication you're not going to know when disparities exist.
With respect to the work with getting better data, which is
important, that is one of our highest priorities. We are
upgrading our integrated compliance information system--it is
one of the largest data bases in the Federal Government--to get
better data on what the compliance data for the various States
are.
With respect to the State review framework, a very
important effort started in cooperation with the Environmental
Council of the States, ECOS, where EPA's regions are assessing
the adequacy of the various States to ensure that, in fact,
each State meets its responsibilities, to understand what the
differences are between States and if there are valid reasons
for those differences, and to recommend improvements to the
States where there are areas that need improvement.
As part of that effort I might mention that there are
several programs that we directly implement where the States
have not picked up, it has not been delegated to the States,
and we are evaluating ourselves as part of that State review
framework to determine if there are areas for improvement or
areas of inconsistency. That is a major effort. It continues
through fiscal year 2007. At the end of that period we believe
we will have reviewed all 50 States.
Senator Inhofe. Here's what I would like to do. I'd like to
follow up and see if some of these things are actually working.
One of the problems I see in regulation is that we will have
meetings, point out the problems, and then nothing happens.
Actually, that was the situation with the Nuclear Regulatory
Commission several years ago. They had not had any oversight
and had not had a chance to look and see and develop some way
of measuring successes and to see what works and what doesn't
work.
What I would like to do is, through a communication with
you and with all of you, to follow through and see what kind of
improvements we can have. It was not my intention to single out
just Region V. That is one I probably personally have heard
more about more of the problems, but I have also heard in some
of the other areas, too. So I would like to do that and we'd
like to set up something.
You will all three be receiving questions for the record
from members who are not here. Their staffs are here.
Senator Inhofe. With that, we will go ahead and dismiss you
as the first panel and call up the second panel. I thank you
very much for being here. Mr. Nakayama, I look forward to
having a visit along the lines that we discussed, too.
Mr. Nakayama. Thank you.
Senator Inhofe. Yes, sir.
Our next panel is Jean Payne, president of the Illinois
Fertilizer and Chemical Association; Dr. Richard Waterman,
chair of the Department of Political Science, University of
Kentucky; Eric Schaeffer, director, Environmental Integrity
Project; and David Paylor, executive director, Virginia
Department of Environmental Quality, Officer, Environmental
Council of States.
Let's go ahead and start with you, Ms. Payne. If you'd go
ahead and give an opening statement and try to hold in to our
timing if we can, your entire statement will be made a part of
the record. We will recognize you at this time.
STATEMENT OF JEAN PAYNE, PRESIDENT, ILLINOIS FERTILIZER AND
CHEMICAL ASSOCIATION
Ms. Payne. Thank you, Mr. Chairman. I have been working
with the Illinois fertilizer dealers for 15 years. We handle a
lot of anhydrous ammonia in Illinois since the 1950's, and the
RMP regulation is not really about handling ammonia safely, it
is about documenting how you handle ammonia safely, which we
have been doing very well for 30 to 40 years. Most of our
fertilizer dealers have been in business for 30 to 40 years.
There are about 700 agriculture chemical facilities in
Illinois, the majority of which are small businesses.
When Region V actually reached out to us 7 years after the
regulation went into effect, we actually kind of welcomed it
because had it not been for the Fertilizer Institute and the
Asmark Institute we would have really had no compliance
materials to help our dealers understand what is a very
complicated Federal regulation. So when they first initiated
contact with us in 2002 to say, ``Well, we want to do a pilot
program and want to check your compliance with the RMP,'' we
welcomed it, because we do want outreach with the U.S. EPA.
Unfortunately, 2 years after the compliance program
started, I really found out by accident that they felt like all
500 of our fertilizer dealers were out of compliance. I want to
tell you that the only people they checked were people who
filed their RMPs and made a good faith effort to comply. There
was never any effort to locate fertilizer dealers or other
industries that did not file RMPs. So right away our fertilizer
dealers feel like, ``Gosh, I tried to do the right thing and
then I get singled out for enforcement.''
When I found out that they felt like every one of our
fertilizer dealers was out of compliance, they suggested a
monetary penalty----
Senator Inhofe. You said every one of them. You said 500.
Is this about what you have?
Ms. Payne. We had actually a few more than that. They
requested a list. They worked with our Department of
Agriculture, which we supported. They requested a list of the
fertilizer dealers from the Department of Agriculture, which
they provided with our support.
Actually, you know, when we found out about it I
immediately, in fact, the day after I was told by Region V
staff they were going to enforcement, I fired off a letter to
the administrator of Region V, as well as to the U.S. EPA
headquarters, asking them to please not do this until they
could just sit down with our industry and review what they
thought were so many onerous violations.
I asked them in that meeting, when we knew that Region VII
to the west of us had done a similar kind of pilot program with
their Department of Agriculture, but Region VII sat down with
the industry and the only thing that resulted in that region
was a few fertilizer dealers in Iowa got a preliminary
determination letter that stated, ``We think you need to
include your nurse tanks in the RMP.'' They didn't get
violation notices or monetary penalties.
So when I asked why would Region V take this approach when
Region VII did not, I was told, ``Well, we really can do
whatever we want. That is a different region. Everything is
done differently.'' That was the only response I received to
that question.
We were never given a chance to review the alleged
deficiencies. Over the entire summer last summer I requested
meetings with Region V to sit down with us. I wish I had a
dollar for every phone call and e-mail I made to the Chicago
office begging for them to sit down with us that was not
returned.
You had a copy of a letter up there that was sent to one of
our fertilizer dealers. Through the whole month of December,
you know, I was told that our dealers would get--actually, they
had agreed to us in a meeting with Region V that they would
send out a letter but it wouldn't say ``violation.'' It would
say, ``Well, there may be some deficiencies.'' We were OK with
that, and then it would list the deficiencies, and then they
would provide our dealers with an opportunity to go to
training.
After that meeting, which was on November 30th of last
year, I really felt good--better, at least--about the way
things were going. But then 2 weeks went by and we had no
contact, even though I had called many times saying, ``When are
you going to send out these letters. It is getting awfully
close to Christmas.'' This letter to Mr. Hamson he received on
December 19th with a threatened $32,500 per day. I believe it
is mentioned twice in there.
He called me, and I have to tell you, and this may sound
like small town U.S.A., he owns this small dealership with his
wife. They have been in business for 35 years. They have, like,
six total employees. He called me and he was incredibly shaken.
He had never had an ammonia release in the history of his
company, never had gotten a letter from Region V or any EPA,
for that matter, and he actually asked me if he was going to be
going to jail for this.
I will tell you that that week he closed down his
fertilizer facility, the shop, to frame up an addition to the
church. I mean, these are the kind of people that live in these
small communities and they were devastated by these letters
that went out to 500 people just like Mr. Hamson.
I had to reach out to the Region V administrator, you know,
begging him to put a stop to these letters because 10 days
after December 19th is December 29th. A lot of our guys weren't
even going to be in the office, and here you are subject to
$32,500 per day, even though these inspections had happened
over a year earlier.
The violations that they listed were so inconsistent with
the Department of Agriculture inspection reports I was actually
embarrassed for Region V. Those are some of the issues that we
tried to work out.
Senator Inhofe, had you not opened an inquiry, you will see
in that letter our members were going to be subject to consent
agreements. No other fertilizer dealers in the country have
been subject to consent agreements for alleged violations of
their RMP. I am sure that we would have been forced down that
path had you not intervened.
We were able, after the intervention of your office, that
condition was dropped, but at the time when I protested it I
was told, ``Well, that is the least onerous tool in the
enforcement toolbox.'' Honestly, I thought to myself, ``Maybe
we could brush off the education and outreach toolbox and see
what might be in there for help with the fertilizer dealers.''
If I could just have 30 more seconds, I have a statement
from one of our fertilizer dealers that really says it well on
how they felt about receiving these letters. This is from David
Smith. He's the manager of Okaw Farmers Co-op in southeastern
Illinois. He says, ``I started in the grain and fertilizer
business 30 years ago, and out of those 20 years I am mayor of
a community of 1,300 people. I have always looked out for the
safety of our community and not had a problem with anhydrous
ammonia yet. We have always been checked out by the Department
of Agriculture and I welcomed their visits to make sure I had
not overlooked anything.
Since RMPs were put into effect, my direction has been
shifted from a local safety standpoint to just trying to
satisfy the U.S. EPA and the paperwork. The paperwork is not
understandable. We receive very little help from EPA. Then we
make one mistake and we are threatened with huge fines.
The Department of Agriculture cannot even answer my
questions because they do not understand the regulation,
either. I would much rather see EPA work with the Departments
of Agriculture and the agrichemical dealers to create
regulations that are more uniform across the Country and more
understandable if we are expected to follow them. If we operate
a safe business but our paperwork is not up to EPA's
expectations, we are threatened with huge fines instead of them
trying to work with us.''
That really says it.
Senator Inhofe. It does. Well, even though you have read
the letter, without objection I will include that letter in the
record. That is actually important.
Thank you very much.
Dr. Waterman.
STATEMENT OF RICHARD W. WATERMAN, CHAIR, DEPARTMENT OF
POLITICAL SCIENCE, UNIVERSITY OF KENTUCKY
Dr. Waterman. Thank you very much. Thank you, Chairman
Inhofe and Ranking Member Jeffords, for the opportunity to
testify before the committee today. I am here to testify
regarding regional variations within the EPA, a subject that I
have studied extensively. I have submitted comprehensive
testimony for the record, but will limit my oral statement to a
few important issues.
To my knowledge, this has been a largely overlooked area in
academic studies of the EPA. Scholarly work tends to focus
their attention on the activities of States with primacy or on
the EPA officials in Washington, DC, yet most EPA employees
operate not in Washington but in various regional offices
around the Country. These regional offices represent a major
reason for variations in enforcement.
EPA officials that I spoke to in the Washington or national
office during the Presidencies of both George H.W. Bush and
Bill Clinton described considerable frustration with the
enforcement activities of the regional EPA offices. This
suggests to me that this is not a Democratic or a Republican
problem, as frustration with regional variations was expressed
during periods when both Democrats and Republicans controlled
the White House, as well as the Congress.
Both parties appear to be interested in a more uniform
style of enforcement, even if they don't ultimately agree on
what that style should be; that is, whether it should reflect a
strict enforcement approach or a style that emphasizes a
greater level of negotiation with business.
With regard to regional variations, one particular point of
position stood out as a subject of concern. Most memorably,
several years ago when I asked one top Agency official in the
EPA Water Office why there was so much variation in enforcement
from region to region, I was surprised to be treated to a
rather candid and colorful exposition of how a particular
regional administrator was enforcing the law, not in accordance
with the wishes of the then current Administration, but rather
in accord with the desires of the political culture of that
region.
When I asked for more detail on this point, I was informed
that some regions are naturally more aggressive in their
enforcement zeal while others are not. I was told that regional
administrators represented one of the last vestiges of the
practice of Senatorial courtesy, and that often the
administrators represented the political viewpoints of the
region rather than national interests.
As a result of this and other discussions with EPA, State
enforcement personnel, members of environmental groups, and
people in the regulated industry, I ultimately conducted two
surveys with two of my graduate students. Among the many
questions on our surveys, we asked, ``How much influence do
various policy actors have over how your office enforces the
law?''
We asked bureaucrats to rank these policy actors on a five-
point scale, from no influence to a great deal of influence.
Among EPA officials, regional administrators narrowly ranked
first in terms of their perceived level of influence, with the
EPA administrator ranking second. It should be noted that they
ranked much higher than the Federal courts third, Congress
fourth, environmental groups fifth, public opinion sixth, and
the President seventh.
When we asked State officials the same question, they
ranked the Governor first, the State legislature second, the
U.S. EPA administrator third, the U.S. Congress fourth, the
State's Finance Committee fifth, and then the regional
administrator sixth.
What was surprising to us, however, is that regional
administrators were seen as having essentially the same level
as the EPA administrator among EPA enforcement personnel, and
that both were seen as having more influence than either
Congress or the President.
What our results suggest then is that, particularly among
EPA bureaucrats, regional administrators are perceived as
exerting considerable influence. Given the obvious frustration
expressed by U.S. EPA officials regarding regional
administrators, it is also clear that this is a point of
contention within EPA, itself. In particular, there is a sense
that EPA regional administrators tend to reflect the viewpoints
of the regional offices and personnel rather than the national
office.
One EPA official in the national office said that the
regional administrators tended to be co-opted by their
personnel in the offices, as well as by the political culture
of the region.
What then is the solution? It is unreasonable to expect
enforcement to be precisely the same in each region. There are
some valid reasons for regional variations which would not be
appropriate to force a one-size-fits-all approach on all
regions. A stricter enforcement approach may be required in
some settings and in some regions, while negotiations with
industry may be appropriate in others. In this process it is
clear that elected officials have a legitimate role in
overseeing the bureaucracy.
First, while Presidents often pay close attention to the
qualities of their national EPA officials, past experience
suggests they are less attentive to the types of individuals
they appoint to the regional EPA offices. This may be due to
the fact that they are inherently believed that such officials
will follow directives by the U.S. EPA. Since my research
suggests this is not the case, the first recommendation is the
President should be more attentive when they appoint regional
administrators. As noted, these ten regional administrators are
perceived by EPA to have slightly more influence.
Beyond appointments, is it appropriate for elected
officials to have continuing oversight of the bureaucracy? I
believe here the answer is yes. I have found that not only can
Presidents influence the bureaucracy, but Congress can, as
well. In fact, what scholars refer to as political control of
the bureaucracy can be conceptualized as part of our necessary
system of checks and balances.
While our Constitution is largely silent on the
bureaucratic State, it is clear that elected officials can and
should exert influence over the bureaucracy. Bureaucrats have a
wide array of expertise that should not be ignored, but elected
officials represent the public interest in a different way.
They can make sure that bureaucrats are applying the law fairly
and in accordance with the intent of Congress, as well as
representing public opinion.
Congress has a legitimate role in determining how much
variation should be permissible and whether regional
administrators should be more loyal to the regional offices in
which they serve or the national EPA office.
Thank you. I will be happy to answer any questions.
Senator Inhofe. Thank you, Dr. Waterman. That was an
excellent statement.
Mr. Schaeffer.
STATEMENT OF ERIC SCHAEFFER, DIRECTOR, ENVIRONMENTAL INTEGRITY
PROJECT
Mr. Schaeffer. Thank you, Mr. Chairman and Senator
Jeffords, for inviting me to testify today on the need for
greater consistency in enforcing Federal environmental law.
I am Director of the Environmental Integrity Project, a
non-profit group that generally advocates for more enforcement,
and previously was director of the Office of Civil Enforcement
at EPA.
EPA has a very, very difficult job, as I think everybody
here recognizes. The Agency has to enforce 19 environmental
laws in 50 States. EPA has delegated, as it must do under the
statutes, the responsibility for enforcing those laws, most of
those laws, to State environmental agencies. States have widely
different philosophies and levels of competence when it comes
to carrying out those responsibilities, so, not surprisingly,
there is a great variation in how an environmental law that is
Federal is enforced in one State compared to another. If the
concern is for greater consistency--and I think everybody
shares that concern--that issue ought to be looked at first.
I would agree with Dr. Waterman. This is not a partisan
issue or one Administration versus another. This is a problem
that has persisted for years. It is something I struggled with
at EPA and was never convinced I was doing a good enough job to
address, so oversight is definitely welcome.
I would suggest starting by looking at audits from the
Inspector General and the Government Accountability Office
conducted over the past decade which document this problem and
put it in very black and white terms. I will start in 1997. The
IG found that two States had completely failed to identify
significant violators of Federal hazardous waste laws. In 1998,
seven States had failed to identify major violations of the
Clean Air Act. Between six of those States, the inspectors were
able to document only 18 violations. The Inspector General
found 103 looking at only about 10 percent of the files.
In 2002 the Government Accountability Office said over half
the States don't inspect underground storage tanks every 3
years, as EPA recommends. In 2003, an IG audit found that
Louisiana couldn't even locate records that they needed to know
whether or not facilities were in compliance. And in 2005 the
IG found that States varied widely in their ability to monitor
air emissions.
Those are just a few of the examples.
Again, I want to say some States are doing an outstanding
job in some programs. Other States are falling well short. That
disparity is probably where you are going to see the biggest
differences in how Federal laws are enforced, and that really
deserves your attention.
I also want to emphasize this is not a squabble about
whether penalties are too high or too low. This is about the
ability to even identify a violation and require correction in
the first instance, which I think is pretty serious, and I hope
you will take it seriously.
As with all these difficult Government issues, this is a
lot easier to diagnose than it is to fix. I am sure funding is
part of the problem for some States. I know appropriations are
in short supply. I do think States have the authority to raise
permit fees. Title five of the Clean Air Act is one example.
Congress could look at that. EPA could make enforcement
expectations clearer.
I think the bottom line is the Agency has to grind it out
on a day-to-day basis with oversight. It is a very hard task.
There needs to be dialog.
I know with respect to the Clean Air Act violations, when
the IG documented all these problems in State programs we sat
down with States and actually redefined the set of violations.
We found there was some legitimate confusion about what should
be counted and what shouldn't. So EPA has some
responsibilities, too.
I do want to suggest, and I think maybe Dr. Waterman made
this same point, that we are in a Federal system. The authority
to enforce these laws is going to be shared. There is going to
be some deviation. I think we are going to have to tolerate
that and decide how much we can tolerate. Ultimately, that is a
political question. But I think we can do better.
I can't resist a quick comment on the concern coming out of
Region V. I have to confess I don't know the situation as well
as I should. You do often see in Government letters offering
amnesty, limited amnesty, the ability to comply without
penalty, language that recites the penalties for failure to
non-comply. I don't think that is so unusual. I would ask you
to think about speeding tickets. I like to think of myself as
law abiding, but I have gotten some. On that speeding ticket
you will see usually language that says, ``If you don't either
pay or appear in court you can be arrested.'' That has never
prompted me to ask for a hearing or suggest there is something
untoward about that.
So I would just close by saying I hope you do follow up on
State programs and the deviations that have been documented in
these IG and GAO reports. I think the oversight is welcome and
I look forward to continued discussion.
Senator Inhofe. Thank you, Mr. Schaeffer.
Mr. Paylor.
STATEMENT OF DAVID PAYLOR, EXECUTIVE DIRECTOR, VIRGINIA
DEPARTMENT OF ENVIRONMENTAL QUALITY, OFFICER, ENVIRONMENTAL
COUNCIL OF STATES
Mr. Paylor. Thank you, Mr. Chairman.
I am David Paylor. I am the Director of the Virginia
Department of Environmental Quality and I am here representing
the Environmental Council of States, in which I am an officer.
The Environmental Council of States is made up of the 50
States' commissioners, and we exist to improve the relationship
with EPA.
States' environmental agencies have as their primary
contact the ten regional offices, and then we work directly
with the central office, as well, with which we have good
relationships. I would have to say in general the State
relationships with regional offices is very good, but in some
cases we do find that we have concerns about performance that
have to do with inconsistencies.
I think it is worth noting that the States operate 75
percent of the Federal programs. We have about 95 percent of
the enforcement actions and we collect 95 percent of the data
in response to the Federal programs.
I'd say that the four areas that we would want to point to
where we have concerns about consistency are related to
enforcement issues, provisions of grants, interpretation of NPM
National Program Manager guidances, and then some staffing
issues.
when it comes to the question of enforcement, ECOS went to
EPA in 2004 with our concern that the Agency might be allowing
inequities in performance with environmental matters. I would
have to say that the inequities probably fall into two
categories. One is philosophical and it focuses on whether or
not the primary measure is, in fact, the size of the penalty,
or whether or not the primary measure has more to do with the
environmental result that is achieved.
We propose that the Agency and ECOS work together in a
State review framework that you heard referred to earlier. This
is underway, and we believe that it is bearing some positive
fruit and would recommend that you follow the State review
framework to see how that goes.
As regards to funding concerns, States get between 5 and 30
percent of their funding for the operation of their programs
from the Federal Government. Oftentimes, we see delay in
provision of funding. For example, in Tennessee in Region IV
just this year, out of 12 grants all but four of them were
delayed more than 3 months, and one of them still has not been
paid. We really rely on these grants in order to be able to do
our programs, and would like to see more consistency in the way
that the grants are made available to the States so that they
can have access to those funds.
Four, national program manager guidance, those rules are
not implemented consistently across the State. The way it works
is the central office provides that guidance to the regional
offices. As you have heard, they have a fair amount of
flexibility in how they are implemented. I agree that that
flexibility is needed to deal with regional differences, but I
would also submit that philosophical differences enter into
some of those inconsistencies.
For example, in Oklahoma it was recently determined that
for a certain rule that a cooling water discharge was exempt,
EPA initially agreed; then, when they were asked again they
hedged. Oklahoma had a difficult time and was unable to
determine what, in fact, the EPA rule was.
I would say that the inconsistencies that we see fall into
about three categories. One is a failure to provide clear
guidance to the States on what the rule would be. A second
would be adding to the interpretation some regions may
interpret rules more narrowly than others. For example, in air
rules they are fairly complicated when you have to determine
the applicability of new source review requirements. We would
see different guidance from different regions on whether or not
those rules apply.
Third, we would have a concern about the additional
requirements that come in addition to NPM guidance, and those
really have to do primarily with adding on reporting
requirements that are perhaps more than is justified for States
to have to do, and that impacts our resource issues.
I wanted to make a comment last about resource issues. In
1992, the States implemented 45 percent of the Federal rules.
Now we implemented in 2002 [sic] 75 percent of the Federal
rules with actually only one new statute during that time, yet
we see 40 new rules per year come along. States have been
downsizing over that time in terms of their staff, while
getting increased resources. From 1992 to 2000 EPA staffing has
stayed about 18,000. We have not concluded that that is an
inappropriate level of staffing for EPA, but we just would
raise the issue that there maybe are some resource issues that
we need to look at holistically across the Nation so that we
can continue to provide the environmental services that we are
called upon to provide in a cost efficient way.
I thank you for the opportunity.
Senator Inhofe. Thank you, Mr. Paylor.
I appreciate the fact that you have come in in a well-
organized way with four suggestions. That helps us a lot. I
would like to just go ahead and ask if any of the other members
of the panel, after hearing the suggestions that were given by
Mr. Paylor, have any comments about those suggestions. Anybody?
Ms. Payne. We have always enjoyed working with our State
agencies. I mean, the RMP is one of the few rules that really
was not delegated to the State agencies, and I think that
caused the bigger part of the problem. I mean, our Department
of Agriculture has had oversight over the ammonia regulations.
We really welcomed this pilot program because we thought
that would be a good balance of Region V working through our
Department of Agriculture to improve compliance. But rather
than take the next step and then review the findings with
industry and the Department of Agriculture, they went straight
to enforcement.
I think that pilot program can work if there is just a
better understanding up front of engaging the State agencies
and helping, because the State agencies are at our facilities
three or four times a year, and we have a lot of respect. Quite
frankly, we couldn't have a safety record as we do were it not
for people like our Illinois Department of Agriculture.
It will be a challenge for Region V now because my
counterparts in Indiana and Wisconsin and Minnesota saw what
happened to us and they're afraid to touch this thing with a
ten-foot pole.
I think it can be resolved; it is just going to take some
work and some rebuilding of some trust.
Senator Inhofe. Any other comments?
Dr. Waterman. Yes. People have talked about variations in
enforcement, and enforcement is one of the issues that I have
looked at the most. One of the things, in terms of variation,
is the number of enforcements vary tremendously from region to
region, but there is also a tremendous variation even within
categories.
For example, what is an inspection? I looked at fairly
substantially the national pollution discharge elimination
system. You would think there is a uniform way to do an
inspection, but, in fact, some inspections are just somebody
showing up and looking at a water sauce and saying it looks
clean. It is essentially called a visual inspection. Other
times they actually do chemical inspections.
So when you get the numbers and you look at the actual
numbers and you see this many inspections were done or that
many inspections were done, oftentimes that doesn't tell you a
lot, either, because there are variations in the types and ways
that these things are done, as well as in the overall numbers,
so the variation is just really difficult to get a handle on.
Senator Inhofe. Yes.
Mr. Schaeffer. I thought Mr. Paylor's recommendations were
very good. I am especially sensitive to the problem of
conflicting interpretations because they create a real problem
for enforcement and make enforcement much more difficult.
It is going to be hard to get it back because businesses on
a day-to-day basis want quick answers. They're looking for
quick answers, and so a lot of the answers come from the
region, and even more come from the State, so pulling all that
together and trying to get some consistency is going to be a
challenge, but it is not a challenge that Government can walk
away from.
Senator Inhofe. Ms. Payne, let me ask you a question. Did
you get a phone call from the administrator of Region V, I
guess Bharat Mathur--I may not be pronouncing that right--prior
to your appearance here concerning your testimony today?
Ms. Payne. Yes, I did, several weeks ago. I have known Mr.
Mathur since he was at Illinois EPA, so I have known him for a
long time. You know, it made me uncomfortable being asked that
question because I have to have an ongoing relationship with
Region V. This is not going to be the only issue that we have
to work with them on.
I will give him credit. I think had he not really took
notice of what was happening to our fertilizer dealers and
listened to the concerns of your inquiry we could have ended up
with a worse situation, but I really feel--and I think this
happens in more than just Region V--sometimes by the time the
administrator becomes aware of what the staff is doing it is
too late and the damage has been done. The violation letters
have been issued, and those violation letters will always be on
the records of our fertilizer dealers. They can't undo that.
That is a concern, because if these guys ever do have an
accident in the future, maybe not something that they even
caused, a meth head breaking into an ammonia tank and causing a
release, they are on record as being in violation of the Clean
Air Act already for something that we really tried to challenge
and without your help would have consent agreements on. That
can shut down your business, as many of you know.
Senator Inhofe. The threat that we talked about that was in
the letters, $32,500 a day, was it?
Ms. Payne. Yes.
Senator Inhofe. You know, I don't know the financial
structure of these complaints, but I am sure that you have
looked at that and certainly they have looked at it. How long
can they stay in business if they are faced with something like
that? Again, I use the analogy of the experience that we had in
Oklahoma in the Superfund site. Here's a guy that was complying
with the law that would be out of business in 40 days.
Now, I have to say, Mr. Schaeffer, if the best analogy you
can come up with to justify that kind of intimidation is a
speeding ticket, I'd say that you don't have a very strong
case.
Mr. Schaeffer. I just have to respectfully disagree. I
don't find a letter that basically outlines penalties for non-
compliance, you know, by itself to be the end of the world. I
mean, these are laws and there are penalties for not complying.
In this case no penalty was collected and the companies were
allowed to self certify compliance. This strikes me----
Senator Inhofe. Wait, wait.
Mr. Schaeffer [continuing]. as a fairly gentle approach.
Senator Inhofe. Just because no one had to pay, these
people are not professional bureaucrats. These people are the
people who are out there with real jobs, paying taxes, paying
for all the fun we are having up here, and they don't know that
when they get a letter that is $32,500 a day, all they look at
that and say, ``How can I be competitive? How can I stay in
business?'' I know this because I have been in that position
before. I look at this and I see this as unreasonable,
outrageous intimidation. I just can't believe this would
happen.
Look at my farmers in Oklahoma. The cost of fertilizer has
gone through the roof. We recognize it. We have had hearings
here on the cost of natural gas and other things. But this is
the type of thing also that is causing that, having an adverse
effect on my farmers.
I will go ahead and let you go ahead, Senator, from your
Region V Illinois perspective. I am sure you have some
questions.
OPENING STATEMENT OF HON. BARACK OBAMA, U.S. SENATOR FROM THE
STATE OF ILLINOIS
Senator Obama. Well, first of all I apologize for being
late. I was hoping to catch all the testimony. I appreciate
this, Mr. Chairman. I am going to be very brief.
First of all, one of the reasons I wanted to come was
because Ms. Payne and I used to work in Springfield together
way back when, so I wanted to make sure that she had her
Senator here when she was providing testimony. It is good to
see you.
I actually had the opportunity to read the written
testimony about the interactions, and as I think everybody here
is aware Illinois is another farm State, so ammonia has a lot
of important uses as a fertilizer. It is also flammable and is
a key ingredient in the production of methamphetamine.
So my staff and I have met with members of the IFCA. They
are terrific people. They understand, I think, the need for
Federal and State regulation to safeguard the storage of these
substances. But I don't think the IFCA is being unreasonable to
expect some kind of certainty and consistency in the way the
regulators do their jobs.
Now, I have to also say, Mr. Chairman, you know, that
bureaucrats at the EPA are actually working hard and doing
their jobs, too, so I don't want the notion that they're not. I
mean, I think they are civil servants who are trying to do
their best to apply laws that we passed. So I am very
sympathetic to that, as well. They are trying to follow
Congress' mandates, oftentimes because they have limited
resources.
I don't want the EPA to not do its job. The RMP program is
an important one. It has made millions of people safer. I think
we want to keep on doing it.
So I think the key--and I saw this in Ms. Payne's
testimony--is to just develop a better sense of communication
and trust between the parties so that, to the extent that we
can avoid a letter going out where a phone call might suffice,
to the extent that we can make sure there is consistency in the
application of these rules, that there is good outreach and
education ahead of time, I think that everybody will benefit.
Let me just close by saying this. When 90 percent of the
members of the IFCA are found to have failed an inspection,
that seems to me to be a sign not of a disregard of regulations
as much as a serious breakdown in communications about what the
risk management program requires. It suggests that EPA could do
a better job of outreach than it is doing right now.
I appreciate the fact that there were some concrete
recommendations made by Mr. Paylor and others. I hope that
those address them. But it strikes me that this is an industry
that wants to do the right thing, that has a stake in doing the
right thing, and if we can try to break down some of the
barriers to folks working together on this we should be able to
work it out.
With that, Mr. Chairman, I have nothing further.
[The prepared statement of Senator Obama follows:]
Statement of the Hon. Barack Obama, U.S. Senator
from the State of Illinois
Mr. Chairman, thank you for holding this hearing today. First, I'd
like to recognize one of the witnesses, who is a constituent from my
State. Jean Payne is the President of the Illinois Fertilizer and
Chemical Association, and I appreciate her taking the time to appear
before the committee this morning.
Today's hearing is about how the 10 regional offices of the
Environmental Protection Agency enforce the nation's environmental
laws. I'm well aware of the difficulties that Federal regulatory
agencies face in balancing Congress' intent in passing a law and the
need for some latitude of enforcement. I look forward to hearing the
comments of the first panel in that regard.
Later, we'll hear from Ms. Payne about the recent interactions
between her association and EPA regarding risk management plans for
anhydrous ammonia retailers. In Illinois, as in other farm States,
ammonia has important uses in products such as agriculture fertilizer,
but it is also highly flammable, can form explosive mixtures, and is a
key ingredient in the production of methamphetamines.
My staff and I have met with members of the IFCA. They're good
people, and I know they understand the need for Federal and State
regulations to safeguard the storage of anhydrous ammonia. But I don't
think the IFCA is unreasonable to expect some kind of certainty and
consistency in the way that regulators do their jobs.
I also know that the hard-working civil servants in EPA's regional
offices are doing their best to follow Congress' mandates despite
limited financial resources and an Administration that has a less-than-
enviable track record on enforcement. The EPA's RMP program is an
important one that has made millions of people safer all across the
country. We need to make sure that EPA regional offices have the
guidance, policies and resources to make this program work in a fair
and effective way.
So, I'm interested in learning about what happened in my State.
When 90 percent of the member facilities of the IFCA were found by the
EPA to have failed an inspection, that doesn't appear to be a sign of
misdeeds, or a disregard of regulations, but rather a serious breakdown
in communications about what the risk management program requires. Now,
I'm not sure I'd call this an example of regulatory inconsistency but
it certainly suggests that EPA could have done a far better job of
outreach and communication in this case.
So, I look forward to the testimony today and hearing about what we
can do to improve the functioning of our regional offices. Thank you.
Senator Inhofe. Thank you, Senator.
You know, you commented that when 90 percent are found, I
guess, in violation, I would agree with that. There is
something seriously wrong. It has to be wrong with the system.
I know that people don't want to violate, because they know it
costs them money to violate. Quite often there is an attitude
in Washington that the regulated communities are all out there
trying to pollute and trying to do things and, in fact, they
are not. But that does show that there is a serious problem if
all 500 of the fertilizer dealers were found to be out of
compliance.
I wonder, going back to the case that we talked about where
the imposition of the excessive--what I consider excessive--or
suggestion of them, even though they never came to reality, in
that particular company was there analysis made by the company
or reported to you as to how long they could actually stay in
business if they were to have to be paying these fines?
Ms. Payne. I would say that for the majority of our
fertilizer dealers less than a week probably. I mean, some of
them have multiple facilities. Some of them are a single family
owned business. It varies. But we could have accomplished
probably improved compliance without that threat, and that was
one thing that I, in a meeting with Region V staff, really
begged for is, you know, send us a letter, talk about the areas
that we can improve upon, but there is no need to threaten the
$32,500 or criminal imprisonment if you don't respond by 10
days, you know, right before Christmas.
I really thought that they agreed with us, but they then
proceeded, which was rather shocking to us and shocking to our
fertilizer dealers, because, going on EPA's word, I had
communicated to them that you will be getting these letters.
Please don't panic. We are going to be working with you at our
upcoming convention to provide more tips on how to comply with
the RMP now that Region V has finally told us after 7 years
what they really want us to do. We had that commitment from
them. So when they sent that letters anyway--and it was exactly
like Senator Obama said, a complete breakdown in communication
that could have been avoided had they just returned one of my
dozen phone calls.
Senator Inhofe. Yes.
Dr. Waterman, you wrote the book called ``Bureaucrats,
Politics, and the Environment.'' I would ask you the question:
does EPA's regional structure provide bureaucrats the
opportunity to wield considerable influence over policy? If so,
it this bad?
Dr. Waterman. It definitely does. I mean, there is the
issue of primacy, obviously, where the States have a great deal
of influence, but even beyond that it is clear that there are
substantial variations between regions, and, whether you want
to characterize it as bad or inappropriate, it clearly is a
problem. I think one of the factors that explains that problem
has been discussed by the first panel and by people on this
panel, as well, which is that EPA has a goal of national
consistency and flexibility. If you think about that, they are
contradictory goals. If you want to have national consistency
and flexibility, those two things are going to be running
against each other at some point. So regional administrators
and people in the regional office are trying to deal with this
contradiction. I think clearly there has to be more of a
national consistency.
Senator Inhofe. I think, though, that what I was really
getting to is the power of an unelected bureaucrat. Now, what
we do, we are the ones who hear the complaints. We have to
answer to an electorate. I know this because I spent 30 years
in the real world dealing with regulators, and I have seen a
lot of things happen where the fear of putting someone out of
business is there. It is an incredible power.
Something you said, Ms. Payne--I wrote it down--you said
you had a response from one of the people in the regional
office, ``We can do what we want.''
Ms. Payne. Yes. I mean, on the CAFO, when I protested the
CAFOs--and understand, too, we really felt that was wrong. We
didn't feel like we had the resources to hire attorneys to take
on the Federal Government, to challenge that. My association
doesn't have the resources, much less these fertilizer dealers
have that kind of resource. Yes, I mean, I was told--I tried to
understand it because I do work with Federal agencies--that it
was the least onerous tool in the enforcement toolbox. That is
where I think maybe the flexibility factor needs to come in,
that there can be other alternatives than just you either get
this letter or this letter or this letter and that is all we
can do.
Senator Inhofe. Mr. Schaeffer, in your testimony you point
out how the inspections for underground tanks has dropped off,
according to the GAO, and I would ask you if you were equally
concerned back in 1998 when, during the Browner administration,
when the inspections dropped off, although they called it
``enforcement discretion'' at that time, as opposed to the term
that is used now as ``environmental rollback.'' Were you
concerned back then when that happened, or did you disagree
that it happened?
Mr. Schaeffer. First of all, in my testimony I said these
problems weren't confined to one Administration or another. We
have struggled with this consistency problem for years under
different Administrations, so I want to be very clear about
that.
Second, in the Browner administration the issue was not
inspection frequency but whether or not we would be closing
small businesses that didn't comply with the requirement to
upgrade tanks by the 1998 deadline. So I that case I think the
concern was that we would be doing the kind of thing that seems
to be the focus of criticism at today's hearing, which is
coming down hard on businesses that basically had no options.
Senator Inhofe. Also perhaps this is my observation,
perhaps not yours, that that was in 1998 right before an
election, and that would involve literally thousands of gas
stations and made a lot of people mad. Was that a
consideration, do you think?
Mr. Schaeffer. No, I don't think so. I never heard that at
all at EPA. Any time you are in an even year, you, it is an
election year and people raise that as a motivation.
Senator Inhofe. Yes.
Mr. Schaeffer. But I don't believe it was at all in that
case. I certainly never heard that.
Senator Inhofe. Mr. Paylor, I think you pretty much covered
everything in your suggestions. We will take those suggestions.
You testified to the 45 percent increase over the last 10 years
of States with delegated authority, yet the EPA still has the
same amount of employees, 18,000. Do you think the EPA regional
staff should be reduced?
Mr. Paylor. Mr. Chairman, the primary thing that we believe
is that the functions of EPA need to be better coordinated with
the States. We believe there are opportunities to reduce
redundancy. There are some things that EPA regional offices are
doing that are duplicative of the State rules.
Senator Inhofe. Yes.
Mr. Paylor. So there is at least an opportunity to redeploy
resources in a different way, and that has become more of a
concern for all of the States within the last year because of
reduction in EPA funding, and those reductions translate in the
reduction from the States without a reduction in the
expectations of the States.
Senator Inhofe. Well, what we are talking about and the
purpose of this hearing is to get some uniformity. Let me just
assure you this isn't one of these eating, meeting, and
retreating type of situations. We are going to take these
recommendations. We are going to watch the performance of not
just Region V but all the regions to look for that uniformity
and that fairness, a sense of fairness, and the recognition
that there are people out there that are working hard, taking
risks, and paying for all this stuff up here, and they've got
to be considered in a more thoughtful way.
Is there anything that any of you are just dying to say
before we close this thing? Let's start with you, Mr.
Schaeffer?
Mr. Schaeffer. No. I thank you for the opportunity to
testify.
Maybe one last thing, which is on the matter of consent
decrees and whether they were required. My understanding was
ultimately they weren't in the Region V situation. If I am
wrong about that, then I would like to know.
Senator Inhofe. All right.
Dr. Waterman.
Dr. Waterman. Yes.
Senator Inhofe. Now, I have never seen a professor that
didn't want one last shot.
Dr. Waterman. We are known for talking a lot.
I think when the laws were originally passed that much more
of the activity was perceived as occurring at the national
level instead of the regional offices were seen as a way of
representing. With the Reagan administration and onward we have
seen more movement toward the States, so it may be time to
rethink the role of the regional offices, themselves. I mean,
do we really need to have so much autonomy in the regional
offices? Do we really need to have ten regional offices?
If most of the activity is occurring in States and not at
the national level, and essentially the national level is
oftentimes a watchdog on the States, we may just want to go
back and think about whether or not the regional offices are
still a valid means of operating today. I know that is kind of
a bold proposal, but, you know, this was created in 1970, EPA,
so we might just want to look at it and see whether those make
sense any more.
Senator Inhofe. I think that is fairly reasonably. I have
always said--and I would ask if you agree with this generally
in concept--that, having served as the mayor of a major city,
which is the hardest job in America, and served in the State
Legislature, then served up here, it appears to me that the
closer you are to the people, the more responsive you are, and
I think the more thoughtful you are and effective you are, cost
effective.
Do you agree with that?
Dr. Waterman. Absolutely.
Senator Inhofe. You know, in Tulsa, Oklahoma, when I was
mayor, if they didn't like the trash system it ended up in my
front yard. That got my attention.
Dr. Waterman. I mean, what we have seen is a movement much
more toward the local level in terms of enforcement and in
terms of the way that EPA operates. So kind of the regional
offices are now stuck in the middle. You have got the States on
the local level, you have got the national office that is kind
of overseeing everything, you have the regional offices in the
middle, and I think originally they were kind of perceived as
more along the local level.
Senator Inhofe. Yes.
Dr. Waterman. So now they've kind of become this
intermediary between the States and the national office, and,
as we have heard, there is no coordination and communication,
so it just creates a tremendous amount of uncertainty and
confusion.
I agree with what Senator Obama said, that most of the
people who work in EPA are hard working, they try to do their
job. There are some people who obviously step over the line and
don't do their job appropriately, and that is why we are here
today talking about this situation with Region V. But I think
one of the problems is that even if you are a hard working
person working in a region and you don't have proper
coordination, quite honestly what is happening in Region VIII
isn't going to be what is happening in Region II. Even if
people think they are doing the same job, you don't have the
coordination. The staff aren't talking to each other, even if
the regional administrators are.
I think this structure, itself, may be a problem.
Senator Inhofe. You know, it is not unique to the EPA. I
agree with Senator Obama, too. There are literally thousands of
people really dedicated in public service that are out there
working. One of my occupations in the past was aviation. I can
remember with the FAA that 98 percent of the inspectors they
have in the field are people who are really there to serve and
really there to help and look after safety and try to assist
people in a very competitive world. However, that 1 or 2
percent of the others, you have to step in and correct it
because some people can't handle power. I believe that.
Dr. Waterman. And you are never going to have national
consistency as long as you separate things up this way.
Senator Inhofe. Yes.
Dr. Waterman. If you want flexibility, the States can
provide that. The States can provide how they want to enforce
the law, and that is a more appropriate method in terms of
saying, ``OK, this State here wants to be very aggressive in
enforcing the law, this State here wants to work in a different
way.'' Citizens can have an impact in terms of how they vote on
that. But this regional structure, again, just kind of puts a
middle layer in there that seems to be creating a lot of
confusion within the Agency and obviously here today.
Senator Inhofe. I am going to read your book.
Ms. Payne, any last thoughts?
Ms. Payne. I really appreciate, Mr. Chairman, having the
last word on this. I wanted to answer Mr. Schaeffer's question
on the consent agreements. We would have had consent
agreements, again, had it not been for your inquiry. Region V
reissued certificates of compliance which our members have to
sign under threat of perjury that they are in full compliance
with the RMP--and these are due by July 1st and they have a
great deal of heartburn about signing that document because
they still don't know exactly what Region V wants from them on
some of these alleged violations. So we are the only State in
the country that has to sign a certificate of compliance for
the RMP. I just wanted to make each of you aware of that.
On the Wabash Valley case, if I may, that is an Illinois-
based cooperative, as well. It has been kind of a rough year in
Illinois this year. That was a spray drift incident. The
Illinois Department of Agriculture has the authority under
FIFRA to take authority to issue penalties for spray drift
violations, which they did in this situation. Five years later,
Region V pursued this--and the important thing is that this is
a criminal case. Despite what people might think, this is the
first time in our industry that criminal charges have ever been
filed against an agricultural retailer or its employees.
Criminal.
I mean, they wanted to put these pesticide applicators in
jail for supposedly maybe sitting in the fertilizer shop that
day and deciding, ``Let's go take the spray rig out and let's
really try to hurt somebody.'' I mean, that is not what
happened in this case. In a month from now I am going to be out
here with Wabash Valley Service Company because they won a
national environmental respect award from our industry, who
only issues six of those a year, of all the retailers in the
country, because that is the kind of good company they are.
Senator Inhofe. Out of how many retailers is that?
Ms. Payne. In the country?
Senator Inhofe. Yes.
Ms. Payne. I think 5,000 to 6,000.
Senator Inhofe. So they would be one of six?
Ms. Payne. Yes. So, I mean, I just feel like they haven't
been portrayed fairly here. The manager of that company is not
going to let his guys with 20 years of employment history, very
good gentlemen--I know both of them--go to jail for this. And
the judge completely agreed.
Senator Inhofe. Yes.
Ms. Payne. So, I mean, they didn't have the grounds to try
to prove that these people set out with some kind of evil
intent to harm someone. We have spray drift violations
periodically. Illinois is a windy State and we have a
compressed planting season. It can happen. But our Department
of Agriculture steps in and penalizes spray drift violations.
That happened and it should have been settled. That is why we
were so shocked by the U.S. EPA filing criminal charges. It is
not a common thing. It is the only time it has ever happened.
Senator Inhofe. Thank you, Ms. Payne.
Ms. Payne. Thank you.
Senator Inhofe. I want to thank each of the members for
being here today.
We are adjourned.
[Whereupon, at 11 o'clock a.m., the committee was
adjourned.]
[Additional statements submitted for the record follow.]
Statement of Grant Nakayama, Assistant Administrator, Office of
Enforcement and Compliance Assurance and Donald Welsh, Regional
Administrator Region III, U.S. Environmental Protection Agency
Good morning Mr. Chairman and members of the committee. I am Grant
Nakayama, Assistant Administrator for Enforcement and Compliance
Assurance, U.S. Environmental Protection Agency (EPA). I am joined by
Donald Welsh, Regional Administrator for Region III. I appreciate the
opportunity to discuss with you how EPA meets the challenge of ensuring
consistent implementation of Federal environmental laws and
regulations.
scope of the challenge
The United States encompasses a wide range of geographies,
climates, and economic conditions, with a wide array of industries,
agricultural enterprises, and commercial and Governmental entities.
EPA's mission is to protect both human health and the natural
environment across this varied landscape.
It is not a simple task. EPA must accomplish these protections by
implementing 28 different environmental programs contained in eleven
separate environmental laws, each statute with its own mechanisms for
achieving its goals. In addition, because most of these laws allow EPA
to authorize States and tribes to carry out the statutory ensuring the
effectiveness of the State and tribal programs.
The Agency has responded to this complex situation by developing
fundamental principles, a framework of management systems, and a range
of policies that provide nationwide consistency in environmental and
human health protections. Within this structure, Regions, States and
tribes are actively engaged in both the planning and the implementation
of EPA's programs. A critical strength of this system is the balance
and flexibility that has been built in to accommodate, as appropriate,
the inevitable variations in environmental, economic and other
circumstances that arise.
Let me be clear, flexibility is not an excuse for disparity. EPA
does not condone enforcement activity that is arbitrary, that results
in vastly different responses depending upon the location as opposed to
the nature of the violation, or that springs from animosity toward a
business, sector or individual. Disparity of this type is
counterproductive, and does not lead to increased compliance or a level
playing field for regulated entities.
While individual cases are composed of specific facts and
circumstances, differences in enforcement responses do not necessarily
equate to disparities. After taking these case-specific factors into
account, what may appear to be a disparity in EPA's response to a
violation may, in fact, simply reflect those facts and circumstances.
Managed flexibility allows EPA to maintain consistency while
accommodating case-specific differences, as may be appropriate.
EPA's Strategic Plan, developed in accordance with the Government
Performance and Results Act of 1993, is the foundation used by EPA
managers nationwide to determine the highest priority environmental
issues that the Agency must address. Developed by EPA after input from
stakeholders, it articulates measurable goals and objectives against
which the Agency's performance is measured, and describes the means and
strategies that will be used to achieve results. Routine measurement of
the progress being made under each goal enables the Agency to identify
and make any needed adjustments to achieve better results.
Our Plan is built around five annual goals, centered on the themes
of clean air and global climate change; clean and safe water; land
preservation and restoration; healthy communities and ecosystems; and
compliance and environmental stewardship. It discusses the strategies
that the Agency applies across the five goals, in areas such as
science, human capital, innovation, information, homeland security,
partnerships, and economic and policy analysis. The Office of
Enforcement and Compliance Assurance (OECA) supplements the Strategic
Plan's goals with National Enforcement and Compliance Priorities.
The key mechanism for implementing EPA's Strategic Plan is the
National Program Managers Guidance and Annual Commitment System,
administered Agency-wide by EPA's Chief Financial Officer. It orients
all of EPA's activities to meet a single set of strategic goals and
objectives. The Guidance and Commitment System contains solid waste,
toxics and pesticides and enforcement and compliance assurance),
effectively governing the activities of 95 percent of EPA's personnel.
Within the system, EPA programs make detailed commitments to conduct
certain activities over a three-year time frame (e.g., fiscal years
2005-2007). For the enforcement and compliance assurance program, there
are commitments to undertake activities such as the number and type of
inspections that each EPA Regional office will perform. These
activities are reviewed twice each year by Headquarters.
consistency: the regions
Most EPA programs are carried out through ten Regional offices,
with Headquarters responsible for national program oversight and
direction. Given the breadth of environmental issues across the
country, EPA must balance both national consistency and Regional
flexibility in program implementation.
With respect to specific enforcement cases, the Regions conduct
inspections, make initial compliance determinations and provide
compliance assistance. EPA's Regional offices function as specialists
on the environmental concerns within their jurisdictions; their
strength is in supporting the national programs while tailoring their
expertise and work in response to regional issues. They are also highly
effective in working with their State counterparts to ensure that their
work, as appropriate, complements State environmental priorities.
The Regions and Headquarters collaborate on policy applicability
and
interpretation issues; this collaboration is required on issues of
national significance. Although the Regions have the authority to
conclude most cases independent of Headquarters, approval by
Headquarters is required when settlement terms deviate from policy or
when the settlement addresses a precedential legal issue.
EPA Headquarters ensures that national priorities are met and that
the Regions adhere to national program goals, standards, practices and
policies. To this end, the formal mechanism used by Headquarters is the
National Program Managers Guidance and Annual Commitment System, as I
mentioned earlier. In the Enforcement and Compliance Assurance program,
national consistency is achieved on a less formal, continuous and
interactive basis. Along with senior members of my management team, I
travel to each Region at least once a year to conduct management
reviews.
The Enforcement and Compliance Assurance program employs a host of
national policies and guidance that ensure consistency across the
Regions. Statute-specific policies address compliance monitoring,
enforcement responses to violations, penalties and responsibility for
cleanup of hazardous waste sites, all of which were created to provide
consistency across the Regions and Headquarters.
Cross-statutory policies include EPA's Audit Policy, the
Supplemental Environmental Projects Policy, our Small Business
Policies, and model administrative orders and judicial consent decrees.
EPA's Audit Policy, for example, encourages companies to implement
self-audits for compliance with all environmental laws by promptly
reported and corrected. EPA encourages multi-facility companies to
enter into auditing agreements that provide for the review of
corporate-wide compliance, while providing certainty about liability
for self-disclosed and corrected violations. EPA also has special
compliance incentive programs that reduce or eliminate penalties for
small businesses and municipalities that discover, disclose, and
correct environmental violations. In fiscal year 2005, based on the
national plan and program guidance, Region III's resolved 37 Audit
Policy cases involving self-disclosed and corrected violations at 156
facilities. In addition to mitigating 100 percent of the penalty in
most cases, each of the companies corrected its violations, and
committed to improve its management procedures to prevent recurrences
of the violations.
For several years, EPA's enforcement program has used National
Enforcement Priorities to achieve some of our most significant
environmental and human health benefits. Three criteria are used in
selecting national priorities: there is a pattern of non-compliance;
there is the potential to achieve significant environmental or human
health benefits; and there is an appropriate Federal role in addressing
the problem. The selection process involved input from EPA
Headquarters, the Regions, States and tribes.
Each national priority has an implementation strategy and a
national team to carry out the strategy and accomplish consistent
results. Quarterly, a nationally based Planning Council of senior
managers reviews the progress on each strategy and accommodate any
unanticipated developments.
We also maintain national ``core'' program activities: the day-to-
day work of ensuring compliance with the environmental laws. In this
context, flexibility actually provides the enforcement program with the
ability to recognize unique or differing circumstances. As an example,
two ordinary actions to enforce failure to install pollution control
equipment, taken in different Regions resulted in markedly different
penalties. Is there necessarily an inconsistency or disparity in
treatment? No, a lower penalty amount may reflect mitigation for
supplemental environmentally beneficial projects that a settling party
agreed to undertake. It could reflect the fact that one violator was a
small business, whose financial resources are taken into account in our
policies for determining appropriate penalties. There may be
exacerbating circumstances, such as the severity of the environmental
damage caused or the duration of the violation.
The ultimate goal of our program is to obtain compliance with the
environmental laws of the United States. To achieve this, we use a
range of compliance assistance techniques, from web-based information
to workshops and site visits. We actively engage in compliance
monitoring, such as collecting and reviewing compliance information
reported by facilities, conducting inspections and performing
compliance evaluations. We offer compliance incentives, such as
favorable settlements through EPA's Audit Policy or its Small Business
Policy. And we take enforcement actions.
upon our assessment of the severity of a problem and the technique
that is most likely to achieve the most effective results. New tools
and techniques are often piloted on a limited basis before they are
employed nationally. In any event, we do not expect that every Region
will address each compliance situation simultaneously using the same
tool. However, our policies and management systems are designed to
ensure a reasonable level of consistency nationwide.
At the Regional level, the importance of consistency as well as the
value of flexibility are clear. Consistency is essential to provide
fairness to the regulated community and citizens, as well as ensure
progress toward national goals. Occasionally, flexibility is necessary
to allow us to be responsive to individual States' needs, as well as to
address issues that are unique to specific geographic areas.
the need for flexibility
As mentioned, the vast majority of Regional activities are
undertaken to achieve specific national commitments. However, there are
circumstances in which the flexibility that was mentioned earlier has
been crucial in addressing environmental concerns unique to a Region or
State. For example, in dealing with the extraordinary regional
challenge of restoring the Chesapeake Bay, Region III is working
closely with the Commonwealth of Virginia to carry out an Integrated
Storm Water Initiative for the Bay. The purpose of this initiative is
to accelerate environmental results in this area by combining several
regulatory and voluntary approaches in a targeted fashion. EPA is
recognition tools to promote Low Impact Development to achieve greater
pollutant reductions from the developing areas of the State.
In addition to helping address unique State needs, flexibility is
often needed to address Regional environmental problems. One example of
this is the Vinyl Chloride Project. In order to reduce exposure to a
known carcinogen, Region III developed a region-specific plan to
address an environmental problem identified by technical staff,
presented to management and coordinated through Headquarters. Interest
in this project began when observations were made by field inspectors
of movement of this particular pollutant, a known carcinogen, between
air, soil and water at facilities in the Region. Based on these
observations, further research was conducted using environmental,
public health, industry and other data to identify the top chemicals of
concern in our Region. Vinyl chloride was identified as one of these
chemicals of concern. The Region next evaluated which industries had
the greatest risk for pollutant transfers and for which non-compliance
could be an issue. The field observations and data analysis were
presented to EPA Headquarters. The data showed that several other
Regions were likely to have similar issues with vinyl chloride. Based
on Region III's information, Headquarters selected the Vinyl Chloride
Project as a national pilot that would directly address a
recommendation by the General Accountability Office (GAO) to employ
strategic approaches to resource deployment in the compliance and
enforcement program. The Project was selected because it addresses a
significant that demonstrates flexibility in sharing resources across
regions, and can achieve measurable reductions in harmful air, water
and hazardous waste pollution.
Region III led this effort, working in conjunction with four other
regions, the National Enforcement Investigations Center of the Office
of Enforcement and Compliance Assurance and our Headquarters Office of
Civil Enforcement. To date, EPA has assessed the multi-media compliance
status of more than 80 percent of the twenty-three PVC facilities
nationwide. Inspections conducted under this Project focus on
regulatory compliance and, when appropriate, seek innovative and
measurable reductions in harmful air, water and hazardous waste
pollution. In one case alone, a settlement has been reached that
reduced vinyl chloride emissions by 26 tons. Without the flexibility to
develop a Region-specific approach, this project, which is making
significant progress in environmental improvements in reducing the
presence of a known carcinogen, would not have happened.
consistency: the states
EPA oversees State implementation of Federal environmental programs
through policy, guidance and effective working relationships between
States and EPA Regional offices. The major environmental statutes have
a mechanism for authorizing State implementation of environmental
programs. States must demonstrate that they have the capacity to carry
out program implementation. We use joint planning and priority setting
to provide States resource flexibility and to foster use of innovative
strategies for and traditional activity measures for managing programs
and measuring results.
With respect to enforcement, EPA is now implementing the State
Review Framework, which was developed jointly with the Compliance
Committee of the Environmental Council of the States, to ensure
consistency both in State environmental enforcement program performance
and in Regional oversight. It utilizes existing program guidance (such
as national enforcement response and penalty policies) to evaluate
State performance and help EPA determine the adequacy of a State's
enforcement program.
Essentially, the Framework assesses a State's compliance
monitoring, enforcement response and data management using agreed-upon
performance metrics. Reviews are conducted by EPA Regions as
cooperative efforts that describe a State's strengths and weaknesses
under each element and make recommendations with respect to areas
needing improvement. An additional element of the review provides the
opportunity to give States credit for innovative approaches to
achieving results in their programs. The Framework includes national
tracking of recommendations for improvement, to ensure that they are
timely made.
the importance of data
Consistency would be extremely difficult to achieve in the complex
world of environmental protection without sophisticated data systems.
EPA has invested heavily in modernizing its data systems in order to
improve our ability to identify compliance problems and trends; help
inform our decisions about program direction; enhance our ability to
monitor results achieved across the EPA Regions; track progress toward
achieving specific commitments; and improve the quality of the data we
report to Congress, OMB and the public.
conclusion
Differences in enforcement responses do not necessarily equal
enforcement disparities. An enforcement and compliance assurance
program that is so rigid that it fails to acknowledge and allow for the
diversity in our Nation's environmental and demographic conditions
would be counterproductive. EPA's enforcement program is designed to
produce consistent and fair results that achieve compliance, cure
noncompliance, deter future violations, and benefit human health and
the environment. We accomplish this through a system of policies,
procedures, and plans that achieve a high degree of national
consistency while also allowing a necessary degree of flexibility. EPA
remains committed to continuing to improve compliance. If disparities
exist, we are committed to removing them, while retaining the
flexibility we need to address differences.
Thank you for allowing me to appear before you. I would be happy,
now, to take any questions you might have.
______
Responses by Grant Nakayama to additional Questions
from Senator Inhofe
Question 1. In the history of the EPA, how many times have criminal
charges been filed against a pesticide applicator? Please break down
the cases by year, State of occurrence, and offer a brief fact summary.
Response. EPA has identified 56 criminal cases against commercial
or private pesticide applicators through a search of the criminal
enforcement docket and case files. Summaries of these cases are
included in Appendix A. The cases are arranged by the year in which
EPA's criminal investigation division opened the case. We were unable
to identify all cases charged since the beginning of the program
because of the record retention and destruction policy. While case
files were unavailable prior to 1996, we were able to obtain case
information from criminal enforcement databases; news releases and
articles; and copies of pre-1996 case files that were retained for
reasons unrelated to the case.
Summary of Criminal Cases against Pesticide Applicators:
fy 1982
Bryce Anderson/Randy Zimmerman (Nebraska)
A criminal information was filed charging the defendants with
Federal insecticide, Fungicide, and Rodenticide Act (FIFRA) violations
for applying a restricted pesticide without certification by the
Environmental Protection Agency (EPA) as an applicator. Anderson pled
guilty and charges against Zimmerman were dropped. The magistrate
sentenced Anderson to a fine of $100. Anderson had been a certified
applicator and let his certification lapse. He had been recertified by
EPA prior to sentencing.
fy 1984
A.C. Supply (Wyoming)
The defendant, John Michael Anderson (doing business as A.C.
Supply) was prosecuted jointly by the Federal Government and the State
of Wyoming for misapplication of a pesticide. He pled guilty and in
November 1984 was sentenced to a fine of $5,000 and 36 months
probation.
fy 1987
Orkin Extermination (Virginia)
The case involved the misapplication of the pesticide Vikane by the
company. In 1988, Orkin Exterminating was convicted at trial and was
later sentenced to pay a $500,000 fine and was placed on 24 months
probation.
fy 1988
Ronald Rollins (Oregon)
Ronald Rollins used a restricted-use pesticide (Mobay Furadan 4F)
in proximity of a waterfowl nesting area and on fields where waterfowl
fed in a wetland area of the Snake River. In a joint investigation with
the U.S. Fish and Wildlife Service (FWS), a two count information was
filed charging the defendant with one count of illegal use of a
registered pesticide, in violation of FIFRA and one count of unlawfully
taking migratory birds (Canadian Geese) in violation of the Migratory
Bird Treaty Act. A Federal District Court jury handed down a verdict,
which dismissed one count of violating FIFRA, and convicted Rollins of
one count of violating the Migratory Bird Treaty Act. Rollins was
sentenced to one year in jail (with all of the time suspended) and one
year probation.
fy 1991
Humane Coyote Getters, Inc.
Raymond Hall, doing business as Humane Coyote Getters, Inc. pled
guilty following the discovery of numerous dead animals, including red
tail hawks, on his property. Tests conducted indicated the carcasses
contained excessive Carbofuran/Furadan levels. Hall was fined $2,050
and received 36 months probation. The company was fined $2,375 and
received 12 months probation.
Lake Doctors, Inc. (Florida)
Lake Doctors illegally applied pesticides to aquatic areas in the
State of Florida. The company and 14 defendants pled guilty. The
company was sentenced in September 2003 to a fine of $100,000 and 60
months probation. The individual defendants were assessed fines ranging
from $505 to $20,000. Two defendants received 30 months probation and
the rest each received 6 months probation.
fy 1992
Omni Applicators (Arizona)
Omni Applicator, a pesticide aerial applicator, and its President,
Mark Stewart, pled guilty to RCRA and FIFRA violations, including
knowing endangerment, transportation of a hazardous waste without a
manifest, and misuse of a pesticide. Stevens was sentenced in February
1994 to one year and one day in prison and five years probation during
which time he was not permitted to engage in the pesticide business. He
forfeited to the Government all assets, including two airplanes
(estimated cost $60,000) to pay fines and cleanup costs.
Full Circle, Inc. (Washington)
Full Circle, Inc., a wholly-owned subsidiary of Cenex Limited,
disposed of the contents of a cement lined containment pond containing
pesticides and pesticide reinstate that contained listed hazardous
wastes by spraying it on 100 acres of ground that they rented from a
local farmer. Full Circle also pushed over the sides of the containment
pond and covered them with dirt. The company was charged with three
counts of FIFRA violations: knowing distribution of an unregistered
pesticide; knowing use of a registered pesticide in a manner
inconsistent with its labeling and; knowing production of a pesticide
without registering the pesticide as required. In June 1995 the company
was sentenced to 12 months probation and ordered to pay a $10,000 fine.
The company was further ordered to supply the City of Quincy with
$3,000 worth of chemicals and to report to EPA any impoundment
containing pesticides at any Cenex Limited location.
Ronald Heward (Wyoming)
The defendant pled guilty to three counts of unlawful uses of
pesticides. In October 1993, he was sentenced to a fine of $30,075 and
12 months probation.
fy 1993
Florida Waterways Management (Florida)
Florida Waterway Management (FWM) operated as an aquatic management
company throughout the State of Florida from 1986. Steve Weinsier,
President/owner, was indicted on 17 counts of violating FIFRA-unlawful
use of a registered pesticide. Weinsier pled guilty to counts 8 through
17. With his plea the Government moved to dismiss the first seven
counts. Weinsier was sentenced to 36 months non-reporting probation on
each of the 10 counts, to run concurrently. He was assessed a $50
special assessment fee and fined $2,000 on each of the counts he pled
guilty to, for a total fine of $20,000.
Harry Saul Farm (Indiana)
The case was charged after the U.S. FWS reported that the pesticide
FURADAN had been misapplied. The defendant used the pesticide to kill
migratory birds that fed on his minnow farm. Harry Saul pled guilty and
paid a $5,000 fine, while another defendant pled guilty and was
sentenced to pay a $5,000 fine.
fy 1994
Y. George Roggy (Minnesota)
The defendant, the owner/operator of Fumicon, Inc., was a licensed
pesticide applicator who was under contract with General Mills, Inc. to
apply the pesticide Reldan 4e to stored oats. Instead the defendant
applied an unauthorized pesticide, Dusban 4e to the oats, but billed
General Mills for Reldan 4e application. The defendant was charged with
11 counts of mail fraud, one count of adulteration and one count of
FIFRA misuse of a pesticide. In February 1995, the defendant was
sentenced to 12 months probation, 80 hours of community service and a
$25 special assessment fee. The defendant appealed his conviction to
the Eight Circuit Court of Appeals. The Appeals Court affirmed his
conviction and sentence. The defendant then applied to the U.S. Supreme
Court, for a writ of certiorari. The Supreme Court denied his petition.
Aquatics Unlimited (Indiana)
Aquatics Unlimited applied a powerful herbicide, Karmex, to
hundreds of lakes and ponds in Indiana. Karmex's label specifically
forbids aquatic use. The company's owner, Carl Klene, pled guilty to
three counts of mail fraud and one count of misuse of a pesticide. He
received a sentence of $7,950 in fines, 6 months incarceration and 36
months probation.
fy 1995
Lutellis Kilgore & Sons (Ohio)
Kilgore sprayed methyl parathion in over 60 residences, in order to
exterminate pests. Mehtyl parathion is a restricted use pesticide
approved only for agricultural uses. As a result of the spraying, EPA
conducted a Superfund emergency removal at numerous residences in
Cleveland at the cost of approximately $20,000. Kilgore was charged
with four counts of violating FIFRA-unauthorized commercial application
of a restricted use pesticide in a manner inconsistent with its
labeling and illegal distribution of a pesticide. He was also charged
with making false statements. Kilgore pled guilty to the four counts of
violating FIFRA. In September 1997, Kilgore was sentenced to 37 months
incarceration, 24 months probation and ordered to pay $125 in Federal
fines.
S & M, Inc. (Arkansas)
Marvin M. Allison was charged with one count of using a pesticide
in a manner inconsistent with its labeling in violation of FIFRA and
one count of unlawfully killing migratory birds under the Migratory
Bird and Treaty Act (MBTA). He applied the pesticide Furadan to his
rice crops in order to kill migratory birds. The application resulted
in the death of several hundred birds. In September 1997, he was
sentenced to a $5,000 fine and 24 months probation.
fy 1996
Margaret Stewart (Mississippi)
Margaret Stewart worked at Spray Lady in Clarksdale, MS. She sold
the pesticide Endosulfan in improperly marked containers. Endosulfan is
highly toxic to the nervous system. When Endosulfan is mixed with water
it turns a milky white color. Minnie Lou Rudd of Batesville, MS died
after she mistakenly drank from a milk container purchased from Stewart
that contained a mixture of Endosulfan and water. Stewart was charged
with two counts of violating FIFRA; and for knowingly violating that
provision. Stewart pled guilty to the first count and was sentenced to
12 months incarceration and 12 months probation.
Baird Valley Fish Kill (California)
EPA assisted the FBI in this case in which overspray from the
application of the pesticide Endosulfan by Baha Applicators killed
approximately 5,000 fish along a six mile stretch of a drain which
leads to the Colorado River. Rick Tilley, the owner of Baha Applicators
was sentenced in August 1998 to 48 months probation, a $2500 fine and
$15,519 in restitution.
Farm Air Services (California)
Farm Air Services aerially applied the pesticide Endosulfan on an
alfalfa field adjacent to the drain which flows through the Salton Sea
National Wildlife Refuge. A large fish kill was discovered in the drain
and company employees were seen dumping the contaminated fish at two
sites along the New River and Alamo River in an attempt to cover up the
incident. Farm Air Services pled guilty to a felony of the unlawful
discharge of pollutants into the Waters of the United States. The
company was sentenced to 12 months probation, a $2500 fine, and $42,388
in restitution. No individuals were prosecuted.
fy 1997
Reuben Brown (Illinois)
Ruben Brown, an unlicensed exterminator in Chicago, Illinois,
sprayed thousands of homes with Methyl parathion, a restricted use and
highly toxic pesticide. Brown used it as a roach killer. Methyl
parathion, when exposed to rain and sun, breaks down but may last for
years in a protected environment, like a home. EPA inspected hundreds
of homes Brown sprayed, to determine if dangerous levels of the
pesticide existed. More than a hundred homes were identified as needing
some clean-up, which involved replacement of walls and other surfaces.
Some residents had to be relocated during the clean-up of their homes.
Brown was charged with two FIFRA counts of misusing a restricted use
pesticide. In December 1997, Brown was sentenced to 24 months
incarceration and a special assessment fee of $50.
Paul Walls/Dock Eatman (Mississippi)
In July 1997, Paul F. Walls, Sr. was sentenced to 6 years and 6
months in prison on 45 counts of knowingly spraying methyl parathion
without a license and three counts of illegally distributing methyl
parathion in violation of FIFRA. Walls did not have a license for
commercial pesticide application, and he had been ordered to cease his
commercial activities. A co-defendant, Dock Eatman, Sr., also of Moss
Point, received a sentence of 5 years and 3 months for his conviction
on 21 counts of illegal pesticide application.
Oscar Miller (Louisiana)
Several complaints were received regarding the purchase of a roach
spray from Oscar Miller. The complainants had applied the spray in
their homes. Samples taken from the homes revealed the presence of
methyl parathion. Miller was charged with violating FIFRA. The
defendant pled guilty to the charges and was sentenced to 13 months
incarceration, 60 months probation and ordered to pay restitution in
the amount of $61,000 to the U.S. EPA Superfund and pay a victim
$1,500.
Emanuel Johnson (Louisiana)
The defendant sold methyl parathion to individuals who were not
trained or certified to us the pesticide. The defendant also sold
methyl parathion for the unlawful purpose of eradicating household
insects. The defendant was charged with two counts of violating FIFRA.
The defendant was convicted on both counts and was sentenced to 24
months incarceration, 12 months supervised probation and ordered to pay
$128,939 in restitution to the U.S. EPA Superfund account and $2,165 to
a victim.
Lee Poole (Louisiana)
Poole was an uncertified pesticide applicator who illegally sprayed
methyl parathion in homes in the Houma area in February 1996, despite
two previous enforcement actions taken against him by the State of
Louisiana for improper and unlicensed use of methyl parathion. Because
of Poole's actions, the Emergency Response Branch of EPA Region VI
conducted a $2.1 million emergency clean up of methyl parathion
contaminated homes in the Houma area. Poole was indicted on one count
of violating FIFRA. Poole pled guilty to the charge and was sentenced
to 12 months incarceration, 12 months probation, ordered to pay a
$200,000 Federal fine and restitution in the amount of $2,189,175 for
the Federal emergency clean up costs.
Kelly Spraying Services (Tennessee)
Robert E. Kelly, Jr., who operates Kelly Spraying Service in
Memphis, Tennessee, was arrested on a 42-count Federal indictment which
alleged that he illegally applied the pesticide methyl parathion inside
homes. The charges alleged that Kelly purchased at least 280 gallons of
methyl parathion in Mississippi between 1992 and 1996. In April, 2004,
Kelly was fined $250,000 and received 20 months incarceration. A second
defendant was acquitted of all charges.
Casa Famoso Packing (California)
John F. Clement of McFarland, CA, owner and operator of Casa Famoso
Packing, was charged with violating FIFRA by improperly exposing
migrant workers to pesticides. In April 1997, Clement contracted with a
labor company to provide field workers. While the workers were in the
field, Clements directed the spraying of the pesticide Agri-Mycin 17.
In violation of the pesticide label not to re-enter the sprayed area
for 12 hours, Clements ordered workers to continue working immediately
after the pesticide was applied. A number of the exposed workers sought
medical attention. In October 1998, Clement pled guilty and was fined
$1,000.
Richard Witzke (Michigan)
The defendant was charged with misusing methyl parathion in his
house. He was acquitted following a trial in March 1999.
fy 1998
Trehey Termite and Spraying (Kansas)
The defendant, Daniel Trehey, is the owner and operator of Trehey
Termite and Pest Control in Kansas City, Kansas. Trehey misapplied the
restricted use pesticide Rid-a-Bird to the attic above the third floor
of a building occupied by employees of EPA's Region VII office in
Kansas City. Rid-a-Bird contains Fenthion which is a highly toxic
chemical whose use is prohibited in areas near human habitation.
Immediately following the alleged misapplication of the pesticide by
the defendant, several EPA employees became ill and sought medical
attention. This forced the entire third floor of the building to be
evacuated. Trehey was indicted on one count of violating FIFRA for
misuse of a registered pesticide. In March 1999, Trehey was sentenced
to 12 months probation and ordered to pay a $2,000 Federal fine.
Robert Bell (Louisiana)
Bell sold approximately 62 gallons of methyl parathion to residents
of a low-income apartment. Eighty of the approximately 96 units in the
apartment complex tested positive for methyl parathion. Methyl
parathion is only legal for use in agricultural fields where sunlight
quickly breaks it down into less harmful substances quantities. Bell
was charged with violating FIFRA-distribute or sell or to make
available for use or to use any registered pesticide classified for
restricted use. In April 1999, Bell was sentenced to 24 months
probation and ordered to pay a Federal fine of $171.
Glen Dee Taft (Utah)
Taft was the water master for the Fremont Irrigation Company and
part of his responsibilities include the de-mossing of irrigation
ditches. Taft was instructed by his employer to secure an applicator's
certification to lawfully apply the pesticide. Taft made about six
applications of the pesticide without having obtained the
certification. While making one of these applications to the Loa Town
Ditch, Taft failed to notify the Road Creek Fish Farm and Road Creek
Rod and Gun Clubs that are adjacent to this ditch. As a result,
approximately 44,000 fish were killed at an estimated loss greater than
$100,000. Taft was charged with one count of violating FIFRA-knowing
application of a restricted use pesticide not in accordance with its
label. Taft pled guilty to the charges and was sentenced to 6 months
incarceration, 24 months probation and ordered to pay a $2,000 Federal
fine.
fy 1999
Kerry Pace (Utah)
Investigators for the Utah Department of Natural resources
contacted EPA's criminal enforcement division regarding the poisoning
of four bald eagles with Temik, a restricted use pesticide. The
defendant, Kerry Pace, had put the poison on deer carcasses in order to
kill coyotes on his property. In October 2001, he was charged with
three misdemeanor counts for the Eagle Protection Act, Migratory Bird
Treaty Act, and FIFRA. He received a sentence of $1,000 in criminal
fines and 6 months probation
Ray Okelberry (Utah)
A special agent with the U.S. FWS contacted the EPA criminal
investigations division regarding the poisoning of three golden eagles
with temik, a registered, restricted use pesticide. Misdemeanor
information was filed charging Okelberry with one count of knowingly
possessing and transporting a Golden Eagle carcass in violation of the
Eagle Protection act. In September 2000, he was sentenced to a $75
fine.
Kap Dong Kim (Hawaii),
Kim, the owner of a ginger root farm in Hilo, HI, was sentenced in
February 2000 to 4 months in prison and a $5,000 fine and was ordered
to pay $6,113 in restitution after having previously pleaded guilty to
illegally using the restricted use pesticide, nemacur, on his crop in
violation of FIFRA. Kim directed workers to apply it on the crop
without following required standards for worker protection, even though
nemacur is prohibited for use on ginger root. One worker was poisoned
and had to be hospitalized. Kim then deliberately failed to disclose
the pesticide application when questioned by a Government official.
Jaime Rodriguez (California)
Jaime Rodriguez plead guilty to charges resulting from his
application of Thimet 20-6, one of the most toxic restricted use
pesticides on the market, to his fields. At least 200 ducks died after
ingesting the pesticide. In February 2001, Rodriguez was sentenced to
12 months probation, a $500 fine and $1000 in restitution.
Delmar Follis (Indiana)
Follis was a landlord who allegedly used Diazinon, an outdoor
pesticide, inside apartments that he owned. The apartments were located
in low income/minority neighborhoods. Charges were filed and the case
was ultimately resolved as a pre-trial diversion in June 1999.
Two Feathers Bison Ranch (Tennessee)
The company pled guilty to illegally applying pesticides resulting
in domestic pets dying. In April 2000, the defendant paid $2,000 in
fines and received 24 months probation.
Pineland Plantation (Georgia)
Defendants pled guilty to misapplying pesticide to kill quail
predators. In July 2001, the defendants were fined between $500 and
$5000 each.
fy 2000
Pied Piper Pest Control, Inc. (Maryland)
The company discharged pesticides containing cypermethrin into Rock
Creek Park in the District of Columbia and Maryland. The discharge
resulted from the company's attempt to wash down a pesticide spill in
its parking lot by hosing the pesticide into a storm drain, which then
discharged into the park. The pesticide killed thousands of fish along
an eight mile stretch of Rock Creek. In July 2003, after pleading
guilty to Clean Water Act and FIFRA violations, the company paid a
$15,000 fine and $5,000 each in restitution to the Maryland Dept. of
Agriculture and Montgomery County. An employee of the company served 2
years probation, plus 6 months home detention.
Gary LeBlanc and Paul Vidrine (Louisiana)
The two defendants pled guilty to one count of FIFRA and one count
of the Migratory Bird Treaty Act after using the restricted use
pesticide Furadan on pieces of fish for the purpose of killing vermin
that were disturbing their crawfish traps. In the process of attempting
to kill the vermin, they killed at least 12 Federally protected
migratory birds. In July 2000, each received a $700 fine and 12 months
probation.
fy 2001
Wabash Valley Services (Illinois)
In 2005, Wabash Valley Service Co. (Wabash) and two employees were
criminally charged with violating FIFRA by allegedly mis-applying two
restricted use pesticides on a farm field in Illinois in May 2000 that,
through the pesticide ``drift'' from the farm field, caused harm to an
adjacent neighbor, animals and property. The defendants were originally
charged with failing to follow three different labeling precautions
prohibiting application when drift might occur. The court concluded
that the labeling language provided no clear guidance as to how much
drift was too much, the labeling which prohibited ``spray drift'' did
not clearly apply to the application method used in this case, and that
the labeling which prohibited application under ``windy'' conditions
was too vague. The court initially found all three labeling provisions
unconstitutionally vague. The court vacated that opinion and the case
was dismissed.
Joseph Howard (Kentucky)
A special agent of the U.S. FWS informed EPA criminal
investigations division that Joseph Howard was under investigation by
the Kentucky Department of Fish and Wildlife for using Carbofuran to
poison owls and hawks that were killing his fighting chickens. He pled
guilty and was fined $3,500 and 12 months probation.
Nelson County Bird Poisoning (Kentucky)
A special agent of the U.S. FWS informed EPA criminal
investigations division agents that over forty animals, including
migratory birds and Red-Tailed Hawks had been killed by Furadan, a
restricted use pesticide whose use in poisoning any type of animal
violated FIFRA. Joseph LaFollette pled guilty to a $2,500 fine, 30 days
home detention, and 12 months probation.
Donald Ray Keel (Tennessee)
The defendant baited animal carcasses with Temix and killed several
protected species under the Migratory Bird Protection Act, including
Red-Tailed Hawks. He was convicted following trial, and in August 2003
was sentenced to a $1,000 fine, 7 months incarceration, and 12 months
probation.
fy 2002
Menifee County Kill (Kentucky)
Darce Lee Hudson pled guilty to killing a dog and vulture with
Furadan, which he was using to kill predators of his fighting chickens.
In February 2003, Hudson pled guilty to one count of unlawfully taking
a migratory bird and one count of knowingly using a restricted-use
pesticide in a manner inconsistent with its label. He paid a criminal
fine of $1,000.
Albert Doege (Kansas)
Allegations were made that a certified pesticide applicator was
misusing a restricted-use pesticide (Thimet) as a poison, resulting in
the poisoning of several neighborhood dogs. In March 2005, Doege paid
restitution in the amount of $1,977.
Aldicarb Misuse (Texas)
Charles and Paul Hajovsky pled guilty to the unlawful application
of the toxic restricted sue pesticide Aldecarb. Corn saturated with the
Aldecarb was placed in a freshly planted cornfield in order to kill and
or drive away feral hogs which had destroyed previous crops. Each
defendant paid $1,000 in fines and restitution.
Bald Eagles Kill (Nebraska)
Three individuals pled guilty to intentionally lacing animal
carcasses with a restricted use pesticide in order to kill coyotes.
Each defendant paid $1,000 in fines and $4,000 in restitution.
Robert Barnes (Indiana)
Charges were brought regarding allegations that people were being
exposed to methyl parathion within homes owned by Robert Barnes. The
case was resolved as a pre-trial diversion
fy 2003
Simpson County Poison (Kentucky)
The U.S. Fish and Wildlife Service received information that Landis
Franklin was illegally using Furadan to bait and poison predators of
his cattle on his farm. A search warrant obtained 38 migratory bird
carcasses. In May 2003, Franklin pled guilty to one count of violating
the Migratory Bird Treat Act and one count of violating FIFRA. He was
sentenced to a $1,250 fine and ordered to pay $10,181 in restitution.
Kahn Angus Farm (Georgia)
The State of Georgia and the EPA criminal investigation division
investigated complaints that dead birds were found in a citizen's yard
near Kahn Angus Farm. A pile of poisoned corn was found on the farm and
its owner, Roger Kahn, admitted to poisoning corn with the pesticide
Warbex. Over 3,300 birds died from ingesting the corn. Two large ponds
had to be sampled and remediated and several thousand pounds of
contaminated soil were generated as a result of the cleanup. Roger
Kahn, another individual, and the company all pled guilty to violations
of RCRA and the Migratory Bird Treaty Act. The company paid $95,664 in
restitution and a $156,000 fine. Roger Kahn and the other defendant
each paid a $15,000, as well as 60 days home confinement and the
performance of 160 hours of community service.
Arnold Sturgill (Virginia)
Landowner Sturgill, who was not a certified pesticide applicator,
purchased the restricted-use pesticide Vydate-L by misrepresenting his
authority to purchase it. He then misapplied the pesticide by
``baiting'' meat on his property. A significant number of poisoned
animals were found on the property. The case was investigated jointly
by EPA and the U.S. FWS. Sturgill was served with three USFWS notices
(two for the illegal taking of hawks and one for FIFRA misapplication
of a pesticide). The defendant paid a total of $1,500 in fines.
Springville Bird Kill (Utah)
EPA's criminal investigation division was contacted by the U.S. FWS
regarding a kill of about 700 birds along a highway adjacent to Harward
Farms. The owner, L. Jud Harward admitted to putting out ``bait'' on
his property to kill blackbirds. The pesticide used was identified as
Carbofuran. Harward pled guilty to one count of killing migratory birds
(red tailed hawks) and was sentenced to pay a $1,000 criminal fine and
$1,000 in restitution.
Henry County Furdan Case (Kentucky)
The Kentucky Fish and Wildlife Agency advised the EPA criminal
investigation division that Gary Pohlman set out venison covered with
the pesticide Furdadan that had killed both domestic animals and Red-
Tailed Hawks in violation of both RCRA and the Migratory Bird Treaty
Act. The defendant pled guilty to violating both statutes and was fined
a total of $2,000--$1,500 in Federal fines and $500 in State fines.
fy 2004
Big Bend Resort California)
The Big Bend Resort is a lessee of the U.S. Bureau of Land
Management (BLM). The defendant, James Colleasure is a part-time
resident of Big Bend Resort. He mixed pesticide with bird seed and
spread it on the ground around trailers (leased from BLM) to stop
damage from rabbits. A number of migratory birds were killed as a
result of these actions. In June 2005, Colleasure pled guilty to one
FIFRA count of misapplication of a pesticide. He received one year of
probation and was required to pay $6,715 in restitution to the BLM.
Alfred Craft (Louisiana)
An agent of the U.S. FWS requested assistance from the EPA criminal
investigation division regarding the alleged poisoning of a bald eagle
through the use of TEMAC. Alfred Craft was convicted at trial and was
sentenced in February 2006 for violations of the Bald Eagle Protection
Act, Migratory Bird Act, FIFRA (unlawful use of a restricted pesticide)
and two counts of witness tampering. He received 12 months on each of
the five counts, with the sentences to run concurrently. He also was
assessed $124,000 total in fines and restitution.
Log Creek Properties (Kentucky)
Testing on a dead bald eagle discovered on a section of Log Creek
on the Log Creek Ranch confirmed that it had ingested Carbofuran. In
January 2004, a Federal search warrant recovered more poisoned animals
and Furadan in an unlabeled container. In May 2004, Log Creek
Properties pled guilty to one count of taking a Bald Eagle illegally.
The company paid a $15,000 fine.
Kenneth Schaffer (Missouri)
The defendant, a rice farmer, mixed the pesticide Bidrin with bird
seed and spread it on the levy surrounding his rice crop in order to
kill feeding birds. He was charged under FIFRA (misapplication of a
pesticide) and the Migratory Bird Act, and was fined a total of $4,000.
Question 2. Please estimate the cost the Government invested in all
resources applied to the Wabash Valley prosecution, including but not
limited to the costs of investigation, case evaluation, and trial
preparation measured in FTE's and dollars.
Response. Since the Wabash Valley Service Company case was opened
in February 2001, EPA has invested approximately .5 FTE and $63,700 for
activities supporting this case. This includes approximately $61,700
for special agent and regional criminal enforcement counsel payroll
costs and $1,000 for associated travel.
Question 3. Please describe the EPA evaluation process a criminal
case is subjected to from investigation to the filing of criminal
charges.
Response. Headquarters evaluates and monitors criminal
investigations throughout the case process, which includes the
following major steps.
Cases start with leads: A lead is opened when an EPA Special Agent
learns of a potentially illegal event or receives information of a
potential crime. Generally, Special Agents gather preliminary
information to decide whether further action is warranted. Leads that
clearly do not involve potential Federal environmental crimes are
closed without further action or, if appropriate, may be referred to
EPA's civil enforcement office or a State for further action.
Leads may evolve into formal investigations: EPA is guided by the
1994 memorandum, ``The Exercise of Investigative Discretion'' in
determining whether to open a criminal case and evaluates (1) the
presence or threat of significant environmental harm and (2) culpable
conduct.
Case agents have legal and technical support at all stages of the
case development process: In addition to legal analyses by EPA criminal
enforcement attorneys, the Department of Justice (DOJ) provides
assistance throughout the criminal investigative and case development
process. Case agents have ongoing discussions with DOJ prosecutors and
EPA criminal enforcement attorneys about the merits of the proposed
case. The criminal program also relies on a team of forensic engineers,
chemists, biologists and attorneys to help determine whether
prosecution is warranted.
The decision to prosecute an alleged environmental crime and the
filing of charges resides with the Department of Justice: If the
criminal enforcement program decides that the evidence is sufficient to
prove criminal culpability ``beyond a reasonable doubt,'' it will
request DOJ to charge defendants. Both the decision to indict and the
choice of statutory charges and number of counts rests with the DOJ.
EPA evaluates a criminal case, through all steps through the
following mechanisms: (1) Headquarters reviews new cases; (2) Criminal
Investigation Division (CID) desk officers conduct day-to-day oversight
with frequent communication with field agents; (3) Headquarters
monitors case development via interactive online databases; (4) EPA
legal counsel ensure legal sufficiency; (5) field agents report weekly
to Headquarters; and (6) CID's Assistant Director for Investigations
conducts quarterly case reviews with each field office to ensure that
the regional offices are consistent in their case selection criteria,
that cases are chosen in accordance with guidance and the
investigations are proceeding appropriately.
Question 4. EPA Region V interpreted the RMP requirements
differently than other regions across the country. Does the EPA
authorize regions to interpret laws differently in terms of
requirements of the regulated community?
Response. EPA does not authorize its regions to interpret the
environmental laws and implementing regulations differently. Region V
did not interpret the Risk Management Plan (RMP) regulations
differently. Region V's interpretation of the RMP regulations is
consistent with national program policy and guidance.
EPA developed and issued numerous guidance documents, including,
but not limited to, program and industry specific Questions and
Answers, sector-specific model RMPs, and general guidance documents
pertaining to the Clean Air Act Section 112(r) program. These materials
were distributed to regional offices and made available to the public.
In addition, EPA has developed a written RMP enforcement penalty
policy, and issued general enforcement and program-specific guidance
documents to the regions. EPA also holds an annual RMP Regional
Enforcement meeting and EPA Headquarters conducts monthly RMP
enforcement conference calls with the regions.
Question 5 What is the EPA doing to ensure that Federal
environmental laws are subject to the same interpretation across the
country?
Response. EPA works to ensure that environmental laws and their
implementing regulations are interpreted uniformly nationwide by
distributing issue-specific policies and guidance and conducting
training. EPA also holds annual statute-specific national program
managers meetings and monthly program implementation conference calls,
in addition to the constant contact that is maintained through the
daily interaction of EPA Headquarters program offices with their
Regional counterparts.
Question 6. In the last decade, there has been a 45 percent
increase in States' delegated authority yet the EPA has maintained a
consistent level of 18,000 employees. Why does this decrease in EPA
responsibility not correspond to a decrease in EPA regional employees?
Response. The 45 percent increase to States' delegations does not
equate to a 45 percent increase in workload or staffing for States or a
decrease in workload or staffing for EPA. Many of the States were
already doing much of the base program work prior to 1996 before they
were delegated. Most of the delegations that occurred since 1996 have
been to augment the basic delegation such as adding a pollutant or an
industry to the base program.
EPA continues to have the responsibility of accelerating our
nation's environmental pace. In a recent Environmental Council of
States study, from 1996 to 2003, State spending on air, water, and
waste programs declined from $9.6 billion to $8.5 billion, or 11
percent. With this decreased spending at the State levels, States
increasingly have looked to EPA to provide technical or other
assistance with delegated programs.
Additionally, targeted projects have increased over the past
decade. As the numbers of special projects have increased, EPA must
devote more regional personnel and resources to oversight. These
earmarks require more oversight and technical assistance than standard
grants since many recipients are unprepared to spend or manage the
funds, and projects generally take several years to complete, requiring
EPA regional resources for an extended period of time.
______
Responses by Grant Nakayma to additional questions
from Senator Jeffords
Question 1. This hearing included testimony from a representative
of the Illinois fertilizer and Chemical Association about their
interaction with EPA with respect to risk management plans for
anhydrous ammonia retailers. Can you discuss why EPA Region V decided
to focus on Illinois fertilizer retailers?
Response. Illinois fertilizer retailers store anhydrous ammonia.
Anhydrous ammonia is released at the greatest frequency and quantity of
any reported chemical in the Emergency Response Notification System
database. Anhydrous ammonia's extremely hazardous nature was
acknowledged when Congress listed it as one the substances to be
specifically regulated under Clean Air Act Section 112(r). Anhydrous
ammonia can be harmful to individuals who come into contact with it.
Accidental releases of the gas can cause injuries to emergency
responders, law enforcement personnel, and the general public.
Inspections of the agricultural anhydrous ammonia industrial sector,
therefore, fit into the inspection goals of EPA Region V and the
Agency.
In April 2002, EPA Region V looked into partnering with State
departments of agriculture to conduct inspections of anhydrous ammonia
facilities. EPA Region V contacted the State departments of agriculture
in the region that had oversight responsibility for agricultural
anhydrous ammonia: The Illinois Department of Agriculture expressed an
interest in partnering with Region V and conducting federally
enforceable inspections. Almost half of the 1,531 agricultural ammonia
facilities in Region V are located in Illinois. The Region regarded
this effort as a pilot program. If the Illinois Department of
Agriculture project proved successful, and if funding were available in
subsequent years, the pilot could be extended to other States.
Question 2. Is theft an issue at these facilities? Are there
possible illicit uses of anhydrous ammonia?
Response. Yes. Anhydrous ammonia is frequently targeted by thieves
to use in the illegal production of methamphetamine. Theft of anhydrous
ammonia is a serious environmental and health concern because it
becomes a toxic gas when released to the environment. The substance can
be harmful to individuals who come into contact with it or inhale
airborne concentrations of the gas. When unintentionally released
during attempted and actual thefts, the gas can cause injuries to
emergency responders, law enforcement personnel, the public and the
criminals themselves.
A March 2000 ``Chemical Safety Alert'' highlighted the potential
environmental harms posed by the theft of anhydrous ammonia. A review
of the Emergency Response Notification System database documents 67
reported thefts of anhydrous ammonia in Region V States from January 1,
2003, to July 18, 2006.
Question 3. What types of compliance assistance does EPA offer?
What types of assistance did the Agency offer or make available in the
Illinois example?
Response. EPA's compliance assistance includes activities, tools or
technical assistance that help (1) the regulated community understand
and meet its obligations under environmental laws and regulations; or
(2) compliance assistance providers to aid the regulated community in
complying with environmental regulations. Compliance assistance may
also help the regulated community find cost-effective ways to comply
with regulations or go ``beyond compliance'' by pollution prevention,
environmental management practices and innovative technologies.
The Office of Enforcement and Compliance Assurance (OECA) manages
the EPA-sponsored Compliance Assistance Centers and the National
Environmental Compliance Assistance Clearinghouse--a web-based
repository of compliance assistance information. Since 1996, EPA has
sponsored partnerships with industry, academic institutions,
environmental groups, and other Federal agencies to launch 14 sector-
specific Compliance Assistance Centers. The Centers offer updates on
regulatory developments, sector-specific regulatory explanations,
compliance tools and training, a place to ask questions and get
answers, databases on technologies and techniques, and pollution
prevention tips and ideas.
EPA also has created 33 sector notebooks, which are a series of
plain language books that describe a specific industry and the major
environmental regulations that apply to its activities. EPA has
produced several industry-specific and regulatory-specific compliance
guides such as The Micronutrient Fertilizer Industry: From Industrial
Byproduct to Beneficial Use.
Other typical activities include developing and distributing
regulatory guidance materials, developing and conducting workshops and
training courses, developing web-based tools, operating telephone
``hotlines'' and responding to questions from the regulated community
and trade associations. EPA also develops compliance guides to
accompany certain new rules.
For RMP programs, EPA worked with industry groups to develop model
programs. Initially, these model programs were created for ammonia
refrigeration, propane handling, and water treatment operations. In
addition, EPA wrote a number of guides to assist the regulated
community in developing, filing and implementing RMP programs. These
materials were available to the regulated community in both electronic
and hard copy formats in advance of the initial compliance date of June
20, 1999.
At the time the Final RMP Rule was published in 1996, Region V
conducted outreach to industry and trade associations, including making
10 to 15 presentations on the RMP regulations. In 1998, Region V
contracted with a private consultant to develop and conduct an RMP
basic training course for industry, which focused on the basic
requirements of the program. In 1998 and 1999, the contractor and
Region V staff made approximately 15 presentations of the RMP course to
industry and the public. Region V staff also made presentations
regarding the RMP program at conferences and meetings throughout the
Region at the request of various trade groups.
Question 4. Can you please describe EPA's interaction with the
States during these types of inspections?
Response. For RMP inspections, of the six Region V States, only
Ohio is authorized to implement and enforce the Clean Air Act 112(r)
program. Therefore, absent a special program such as the pilot
initiated with the Illinois Department of Agriculture, there would be
no State involvement in these inspections. EPA's agreement with the
Illinois Department of Agriculture was established, in part, to foster
EPA--State collaboration with respect to agricultural sources.
Illinois Department of Agriculture inspectors completed EPA's Basic
Inspector Training Course, RMP Program Specific Training, and Health
and Safety Training in order to obtain EPA inspector credentials. For
each inspection, the State inspectors obtained a copy of the facility's
process hazard review and compliance audit. They reviewed operating
procedures, offsite consequence analysis, incident investigations,
training given to employees, and the facility's emergency response
plan. The inspectors documented findings in a format developed by EPA,
and prepared and submitted a written inspection report. The inspectors
documented their observations; they did not determine whether a
violation existed. EPA Region V staff reviewed the observations and
made violation determinations. EPA Region V staff conducted a quality
control review of the initial inspections. The Region discussed their
findings with the Illinois Department of Agriculture to ensure that the
Region's comments were incorporated in subsequent inspections.
Question 5. Can you discuss the process each region uses to
determine its enforcement priorities for a given year?
Response. When setting new priorities, the regions take into
account existing national enforcement and compliance priorities,
existing regional priorities, areas where they are responsible for
direct implementation, and grant and work agreements with the States
when setting new priorities. All regions consult their State regulatory
partners as part of this process.
Question 6. Did the actions of Region V in this instance deviate
from this practice?
Response. No, Region V did not deviate from this practice in this
instance.
Question 7. How do you think the Office of Enforcement and
Compliance's incomplete and/or inaccurate data on the universe of
regulated entities impacts the consistent implementation of Federal
environmental laws and regulations across regions?
Response. OECA's ability to consistently apply Federal
environmental laws and regulations is not dependent upon having a
complete knowledge of the regulated universe. Consistency is a function
of having clearly defined and communicated policies (e.g., enforcement
response and penalty policies) that describe the appropriate range of
responses to types of noncompliance, and that set expectations for how
to address individual noncompliance problems and patterns of
noncompliance. Complete knowledge of the regulated universe is not
necessary to ensure consistent implementation.
Question 8. How do you plan to coordinate with the Office of
Environmental Information to address the issue of limited knowledge of
EPA's universe of regulated entities?
Response. OECA recognizes and uses the Office of Environmental
Information's Facility Registry System (FRS) as the official Agency
data base that identifies facilities subject to environmental
regulations or of environmental interest, and uses Agency data
standards to integrate information from multiple sources giving a
unique identifier. Using FRS, the overall number of regulated entities
is approximately 1.5 million, and these records are linked with permit
or environmental interest records in Permit Compliance System (PCS),
Air Facility System (AFS), Resource Conservation and Recovery Act
Information (RCRAInfo), Integrated Compliance Information System
(ICIS), Safe Drinking Water Information System (SDWIS) and multiple
other systems. OECA regularly updates its ICIS and the Integrated Data
for Enforcement Analysis (IDEA) system using FRS data on regulated
entities. As FRS makes system and data changes, OECA will adapt in
response.
______
Respones by Grant Nakayama to additional questions
from Senator Voinovich
Question 1. Does Region V intend to approve Ohio's request to
transfer the National Pollutant Discharge Elimination System for
Concentrated Animal Feeding Operations (CAFO) permitting to the Ohio
Department of Agriculture? Why or why not?
It is my understanding that the Ohio Department of Agriculture has
been in communication/consultation with Region V while developing this
package. Can Region V make a determination in 6 months or even 3
months?
Response. Ohio has not asked Region V to approve a revision to the
Ohio National Pollutant Discharge Elimination System (NPDES) program to
transfer the concentrated animal feeding operations (CAFOs) element
from the Ohio Environmental Protection Agency to the Ohio Department of
Agriculture. The Region would approve a revised program that meets the
requirements the Clean Water Act and the Code of Federal Regulations
(CFR). Federal regulations allow two or more State agencies to share
NPDES authority and the Act and regulations contemplate EPA approval of
revised programs that meet the applicable requirements.
Region V and EPA's Office of Water have been providing advice and
assistance to help Ohio revise its program. We anticipate requiring 6
months to make a decision once Ohio submits a request with appropriate
documentation. This period will include an opportunity for the people
of Ohio to comment. It would be difficult to make a decision in a
shorter period of time while giving the people of Ohio a chance to
participate and fulfilling our obligations under the Act.
Question 2. Over the years, EPA has published numerous guidance
manuals that provide valuable information for the industry to consider
voluntarily complying. It is the observation of some that--at times--
the guidance documents are treated as law, though the first page of one
such document entitled ``Managing Manure Nutrients at Concentrated
Animal Feeding Operations December 2004'' States ``This is a guidance
document and is not a regulation. It does not change or substitute for
any legal requirements the obligations of the regulated community are
determined by the relevant statutes, regulations, or other legally
binding requirements. This guidance manual is not a rule, is not
legally enforceable, and does not confer legal rights or impose legal
obligations upon any member of the public, EPA, States, or any other
Agency. In the event of a conflict between the discussion in this
document and any statute or regulation this document would not be
controlling. The word `should' in this document does not connote a
requirement, but does indicate EPA's strongly preferred approach to
assure effective implementation of legal requirements.''
Has Region V or any region ever used the failure of a State to
comply with such guidance, which is not law, as the basis to reject
State proposed standards or informed States that if they do not
incorporate such guidance documents and standards in the development of
regulations, that it is likely that the new regulations will not be
approved, even if they meet Code of Federal Regulations (CFR)
requirements?
If, for example, a State like Ohio decides to use a practice
approved by the U.S. Department of Agriculture's Natural Resources
Conservation Service (NRCS), such as practice standards 633 for
application of waste versus EPA's guidance as outlined in Appendix L of
the ``Managing Manure Nutrients at Concentrated Animal Feeding
Operations'' Guidance Document, would EPA's regional office deny the
Ohio Department of Agriculture package to transfer the National
Pollutant Discharge Elimination System permitting authority from Ohio
EPA to the Ohio ODA?
Response. The Region has not rejected State proposed standards that
meet Clean Water Act and CFR requirements. Region V is working with
Ohio EPA, Ohio Department of Agriculture, USDA Ohio Natural Resources
Conservation Service (NRCS) and other partners to resolve issues
related to the Ohio NRCS Waste Utilization Standard (633) for
application of wastes from agricultural livestock operations. We would
approve a revised Ohio program that meets the requirements of section
402(b) of the Clean Water Act and 40 CFR part 123.
Question 3. Under EPA's CAFO rule, what is the definition of
``discharge?'' Do all regions share the same definition? How do you
interpret this definition to apply to livestock farms?
Response. EPA's CAFO rule does not define ``discharge.'' The Clean
Water Act includes concentrated animal feeding operations (CAFOs) in
the definition of the term ``point source.'' Section 502(12) defines
the term ``discharge of a pollutant'' to mean ``any addition of any
pollutant to navigable waters from any point source.'' All EPA Regions
share this definition. EPA's preamble to its proposed, revised CAFO
rule recognizes that some CAFOs have a higher likelihood of discharging
and suggests that large CAFOs falling into certain categories consider
seeking permit coverage. EPA is seeking comments on the completeness
and accuracy of the preamble list of situations where a discharge may
occur.
Question 4a. There is a constant push within the States to be
faster in issuing permit authorizations. Businesses demand the ability
to meet changing consumer demands by making quick modification or
changes to their plants and facilities. Associated with this pressure
is the desire by business to work within construction seasons to meet
their time frames for completion of projects. Businesses push States to
allow as much construction of new or modified facilities prior to
receiving final permits. Unfortunately, the U.S. EPA has been
inconsistent in how much construction it will allow prior to receiving
either a water or air permit for a new facility. Many States seem to
allow significant amounts of construction prior to final issuance of
permits. Meanwhile, in States like Ohio, I understand Region V has
issued letters and taken enforcement actions against facilities that
initiated construction prior to receiving final permits. For example,
Indiana has a State rule that allows significant amount of construction
prior to receipt of a final air permit. I understand that when Ohio
inquired about that rule the U.S. EPA indicated that they would not
approve another rule like that in another State. The U.S. EPA should be
consistent in the standard it holds States to relative to pre-permit
construction activities. A lack of consistency can put States that are
more conservative in what they will allow at a competitive disadvantage
to neighboring States.
Response. The Clean Air Act and implementing regulations for
construction permitting set minimum requirements for permitting
programs, but do not require that they all be the same. This preserves
State flexibility to tailor programs to meet their own circumstances,
as long as they meet the Clean Air Act minimum requirements. The
minimum requirements assure that proposed changes at sources that could
have an adverse impact on air quality are available for public and
Agency review and are permitted prior to initiation of on-site
construction activities. EPA strives to preserve States' flexibility,
but must assure that minimum requirements are met.
The requirements for allowable pre-construction activity provide
flexibility for minor sources of air pollution, but allow very limited
pre-permit construction for major sources. Within this framework, EPA
has worked to assure a consistent approach to approving State permit
requirements. The Indiana rule you discuss is currently being reviewed
by EPA and we will consider consistency as we complete our analysis and
finalize our determination.
Question 4b. All the States should be held to similar requirements
when it comes to public participation in permitting actions. It appears
that permits are issued in some States with almost no public
participation while others have more intensive involvement. If States
are simply implementing Federal requirements for public involvement,
then those requirements should be clearly identified and enforced
across all regions. Otherwise, States with more involved public
participation will be at a competitive disadvantage because they will
have longer permitting processing time frames.
Response. As noted above, the Act and EPA regulations spell out the
minimum elements of a permitting program. State approaches to public
participation need not be identical, particularly for smaller sources,
where the regulations allow for various approaches that have evolved
over many years of State permitting experience.
For example, all States in EPA Region V require full public
participation for construction actions that trigger Federal air
permitting requirements. EPA is not aware of any States that exclude
all minor actions from public participation. However, EPA has approved
various de minimis emission levels below which minor sources can be
exempt from public participation requirements. When States have
established public participation threshold levels, EPA analyzes such
requirements for consistency with other States.
EPA has become aware of some concerns with existing State rules
that may not meet minimum requirements for public participation. We
agree that this could present a consistency issue, and we would take
action to ensure that minimum participation requirements are met.
However, we are still evaluating these concerns.
Question 4c. Continued: Clarity and simplicity of permits should
also be consistent. Given that all States should be following the same
requirements set forth in the Clean Air Act, why are States treated
differently within the region with regard to length and detail of
permits. For example, Title V permits in some States may be hundreds of
pages long while in another State for a similar facility it is not even
a hundred pages. Another example would be permits for ethanol
facilities. Permits for an ethanol facility in one State are 60 to 70
pages while--within the same region--a similar sized facility requires
a permit more than 200 pages in length. The 200-page permit is reviewed
by the regional office, and the State is told it is meeting the minimum
required permit content. Why is there a difference?
Response. Title V contains minimum requirements for permit content,
which are required as minimum elements of State programs, and EPA
ensures that all State programs meet these requirements. However,
States have flexibility in how they actually translate these
requirements into permit terms, and have, over the years, developed
permitting approaches that are tailored to their specific circumstances
and that their permittees are familiar with. This results in varying
permit length, while still meeting Title V content requirements.
Permit length varies across States for a variety of reasons. Even
if Federal requirements are the same for similar facilities, State
requirements can vary. States also have different approaches to permit-
writing and permit organization. Some States may repeat all the State
and Federal laws verbatim in the permit, which can make permits
lengthy. Other States may use a citation approach in which the basic
emission limits, monitoring and recordkeeping requirements are
identified, but other details of the regulations are identified through
citations to the underlying regulations. Other States may format their
permits differently, using larger print or more blank space. All of
these variations are permissible under Title V provided they meet the
permit content requirements. While we recognize there are reasons a
shorter permit may be desirable, EPA believes it would be inappropriate
to force States to choose one approach simply because it makes the
permit shorter.
__________
Statment of Jean Payne, President, Illinois Fertilizer
and Chemical Association
Dear Mr. Chairman and members of the committee, my name is Jean
Payne. I am here today on behalf of the Illinois Fertilizer & Chemical
Association (IFCA). IFCA represents and assists the retail agrichemical
dealers, who in turn provide agricultural inputs and application
services to the farmers of Illinois. We have over 1,000 members, 700 of
which are ag retail locations in Illinois. Agriculture is the largest
industry in our State.
Illinois is a State where regulations governing the storage,
handling and application of agrichemicals are extensive, more so than
in many other States. IFCA supports the majority of these regulations,
in fact our Association drafted and secured passage of many of these
laws to improve the stewardship of the crop input industry. Our
regulatory agencies in Illinois actively enforce these regulations and
we work closely with them and with our members to ensure that our
industry complies with over 70 different Federal and State
environmental, health, safety and transportation regulations that
affect agrichemical dealers.
Our interaction with the U.S. EPA Region V over the years has been
fairly cooperative, even though we do not work with them on a daily
basis. That's because the majority of the Federal environmental
regulations are handed to the State agencies to enforce, and we do work
daily with State agencies in a very open and fair manner. But I am here
to share with you a troubling situation that our industry now finds
itself in with Region V U.S. EPA. Our members are suddenly on the
receiving end of an enforcement policy that is not justified in
opinion, was not applied uniformly, was not well communicated and does
not treat industry in a fair or equitable manner.
the rmp regulation and illinois ammonia facilities
In 1998, the U.S. EPA promulgated the Clean Air Act Risk Management
Plan regulations that affect agricultural retailers who store anhydrous
ammonia as nitrogen fertilizer. The rule requires our facilities to
document the management and safety of their ammonia systems and to
calculate the worst case scenario for the surrounding community if a
catastrophic release occurs. To give you an idea of the scope of the
agricultural ammonia industry, Illinois fertilizer dealers take
delivery of, store and apply an average of 500,000 tons of this
nitrogen fertilizer each year. Since 1999, when the RMP regulation went
into effect, we have safely handled and applied over 4.2 million tons
of anhydrous ammonia with not a single catastrophic release attributed
to non-compliance with the RMP regulations. Many Illinois corn and
wheat growers prefer this form of nitrogen because it can be directly
injected into the root zone and it is the most economical form of
nitrogen. Our industry is very proud of our safety record.
Prior to the compliance date for this regulation, IFCA hosted
training sessions throughout the State to help our members prepare
their RMP. We utilized materials provided by The Fertilizer Institute
and Asmark, Inc., a regulatory compliance company who specializes in ag
retail regulations. Back in 1998 when this regulation was promulgated,
the only guidance from the U.S. EPA was provided mostly on their
website. It was somewhat helpful but keep in mind that eight years ago,
the majority of our ag retailers did not have access to the Internet
due to their rural location. The only training classes on the RMP
regulation sponsored by Region V were classes to help people determine
IF the regulation affected them. At the time Region V offered these
sessions, the RMP submit computer program was not yet available and so
many of our members did not attend but relied instead on more specific
guidance from TFI, Asmark and IFCA. Our industry already knew that this
would affect our ammonia facilities and so this EPA session would have
done little to help us prepare to comply with this very complex
regulation. In our opinion, there was no specific, hands-on U.S. EPA
outreach or training program enacted by Region V for our industry and
our State EPA was not commissioned by Region V to act as the State
enforcement Agency for this rule either. We really were on our own.
In January 1999, IFCA conducted a RMP training session at our IFCA
convention, which was attended by several hundred ag retail managers.
Since then, we have conducted additional courses, almost yearly as part
of our annual ammonia safety training, to review the requirements of
this rule and assist our members with compliance. Again, we had little
guidance to go from, only the federal regulation itself which is not
easy to interpret and apply in a practical manner. In addition to
attending IFCA training classes, many of our members utilized the
compliance services of the Asmark Institute to fulfill the requirements
of the RMP.
With help from industry groups like TFI and IFCA along with
organizations like the Asmark Institute, our members filed their RMPs
and re-filed them again in 2004 as is required by the rule. During the
entire time this regulation has been in effect, we have periodically
reminded our dealers of their RMP obligations such as the three year
compliance audit and the need to update the plans if changes are made
at the facility. During all this time, we heard nothing from Region V
indicating that we were not keeping up with our compliance obligations.
region v & illinois dept of ag rmp pilot program
It was 4 years after the effective date of this regulation when
Region V first expressed an interest in the RMP program as it relates
to agricultural anhydrous ammonia. Region V approached the Illinois
Department of Agriculture in 2003 with a pilot program in which the
U.S. EPA would essentially hire the State of Illinois Dept of Ag
inspectors to check 500 ammonia facilities for compliance with the RMP
rule. Immediately, the Illinois Dept of Ag contacted me to attend to a
meeting with them and Region V to discuss this pilot program. Had the
Dept of Ag not informed me of this meeting, I would not have known of
it as Region V did not reach out to IFCA. But this was the first
communication our industry had with Region V on this program since its
enactment in 1999, and so IFCA welcomed their involvement because we
often wondered when or how compliance would be assessed given that no
State Agency had been given oversight of this regulation.
It was important to the Illinois Dept of Ag that IFCA support this
pilot program. In the meeting with IDA and Region V, EPA staff told us
that the Dept of Ag inspectors would utilize a RMP compliance checklist
during their inspections. We had the opportunity to review the
checklist and we submitted comments on the phrasing of several of the
questions. Region V staff informed us that they would use the
checklists to review the facilities? overall compliance with the RMP
and if areas of weakness were discovered, it would allow the Agency and
industry to target specific training to improve these areas. We took
them at their word and with that being the premise of the pilot
program, IFCA supported Region V utilizing the services of our State
Dept of Ag to assess compliance with the RMP. After all, we had a lot
invested in the RMP program and we too wanted to know how our members
were doing and what areas may need to be improved. We were also
comfortable with the Dept of Ag inspectors because they interact
frequently and professionally with our dealers and with IFCA.
We informed our members of this inspection program and urged them
to work cooperatively with the inspectors. We viewed this program as
way to establish a closer relationship with the U.S. EPA on RMP
compliance issues. Two years went by and the inspections proceeded. Per
EPA instructions the inspection reports were not provided to the
fertilizer dealers but we had no reason to worry, we thought. There
were no ammonia incidents or blatant violations of the RMP that we knew
of or were told about.
signs of trouble
IFCA RMP Workshop
In January 2005, at the IFCA convention which is attended by over
1800 people in our industry, IFCA with the cooperation of the IL Dept
of Ag conducted yet another RMP compliance workshop. Approximately 150
fertilizer dealers attended this training class. The purpose of the
workshop was to once again review the RMP requirements and help answer
questions about compliance.
A few days after the IFCA convention, Region V staff person Silvia
Palomo called me. She was upset that IFCA and the Dept of Ag had
offered this program at our convention. She said we had no business
informing the facilities of the RMP requirements and that I should have
sought approval from Region V to offer this class. She also told me
that only the U.S. EPA personnel were qualified to teach RMP compliance
and no one else. I was actually being scolded for helping our members
comply with a complex regulation, something we had already been doing
for seven years with no help from Region V. I found out later that Ms.
Palomo had also called Jim Larkin, head of the fertilizer bureau at the
IL Dept of Ag, with the same message. Jim and I were in disbelief.
After listening to Ms. Palomo's scolding, I politely told her thanks
for calling but in my opinion industry had every right to help our
members with compliance since that is one of IFCA?s mission statements.
Honestly, I think she was upset because she didn't want our members to
learn more about the regulation while the inspections were going on. I
believe now that enforcement was Region V?s objective all along and not
outreach and education as they had indicated to us. This was the first
sign of trouble.
Inspections End, Enforcement Begins
In July of 2005, the Dept of Ag told us that they were finished
inspecting the facilities. We heard nothing from Region V. At the
request of the Asmark Institute, I worked to set up a meeting with Mr.
Mark Horwitz and Silvia Palomo at Region V to discuss Asmark's concerns
with an Expedited Settlement Agreement (ESA) that an agrichemical
facility in Michigan had received from Region V for alleged RMP
violations. Asmark was very troubled by the ESA because this facility
was their client and no one other client in the country who had
utilized the Asmark RMP compliance tools had been issued any kind of
monetary penalty for non-compliance.
It was while we were discussing our concerns with the Michigan ESA
that Region V staff changed the subject and informed me and Allen
Summers of Asmark that in their opinion, over 90 percent of the 500
Illinois ammonia facilities inspected were also in violation of the RMP
rules, would be formally cited for violations of the Federal Clean Air
Act, would be fined a minimum of $500 per facility and be required to
attend a EPA training course. It was inferred to me that the Agency was
treating the Illinois facilities kindly because they can fine the
facilities substantially more or issue ESA?s as was done in the
Michigan case.
I have never been more shocked in my professional life. We have had
no ammonia releases in Illinois attributed to non-compliance with RMP
regulations. Our ammonia facilities have an enviable safety record
considering the hundreds of thousands of tons of ammonia fertilizer
that is stored and applied yearly in Illinois. After six years of
getting no help whatsoever from the U.S. EPA on compliance with this
rule, we thought we would be working with the U.S. EPA to identify
areas of uncertainty in RMP compliance and work to improve them; we
were stunned to learn that the Agency intended to go straight to
enforcement and that our fertilizer dealers would all be on record of
being in violation of the Federal Clean Air Act.
While a $500 penalty may not seem like much to some, it is
substantial to many fertilizer dealers who in many cases are family-
owned small businesses. To get a letter from the U.S. EPA that States
you are in violation of federal law with penalties up to $32,500 per
day if you do not comply with the Agency's directives is frightening to
our members, especially when they all felt that their RMP inspections
had actually gone quite well. I immediately sent a letter to Mark
Horwitz, to the Acting Director of Region V and to the U.S. EPA
headquarters outlining our concerns with this enforcement approach and
asking them not to proceed down this track. This was on July 26, 2005.
Receiving no immediate reply to my letter, for the remainder of the
summer of 2005 I continued to urge the U.S. EPA to sit down with our
industry to review the alleged violations so that we could understand
what our members had done so wrong prior to the violation letters going
out. I probably called them or emailed them on almost a weekly basis
requesting this meeting. Finally, in September 2005 Mark Horwitz called
me to tell me that they had decided not to issue the $500 per facility
penalties, but that they would require our members to attend a
mandatory training class as well as enter into a Consent Agreement
Final Order (CAFO). I thanked him for dropping the monetary penalties
but again requested a meeting to discuss the alleged violations and the
CAFO process. Finally, on November 30, 2005 Region V staff agreed to
meet with IFCA and several other industry representatives who represent
the vast majority of ammonia facilities in Illinois. This is now 4
months after the July meeting in which we learned of the enforcement
initiative.
At the November 30, 2005 meeting, Region V personnel did review the
alleged violations with us. While we did not agree with the majority of
their reasoning for the violations which were by far mostly paperwork
discrepancies, we still felt it was a very worthwhile meeting. At the
meeting Region V agreed to offer one of their mandatory training
classes at the IFCA convention in January 2006. They also agreed to let
our industry submit sample RMP compliance forms that they could use as
training tools and they expressed an interest in allowing us to review
their training program to offer constructive suggestions on how it
might be presented so that most fertilizer dealers would understand the
content. Region V told us that the letters to our members would be
phrased in a non-threatening manner and would cite ``deficiencies''
instead of the word ``violation.'' We were told that the letters were
in the mailroom already, and would be going out in a few days. I
immediately prepared our members to receive these letters and assured
them that IFCA would be working closely with them to help them respond
to the ``deficiencies.'' In early December 2005, IFCA printed and
mailed out 1,500 IFCA convention programs to our members and in the
program we listed the U.S. EPA RMP Training Session to be held on
January 23, 2006 during the convention. Our members began registering
to attend this training session.
Hamson Ag Receives First Letter
When no letters had yet been received by our members by the end of
the second week in December, I called Region V to inquire about the
status. My phone calls were not returned. On December 19, 2005 I
received a call from Ronnie Hamson at Hamson Ag in Dahlgren, IL.
Dahlgren in a small community in deep Southern Illinois. Ronnie is the
definition of a small business as he runs the fertilizer plant with his
wife and a handful of employees. He had shut down the facility the week
prior to Christmas so that they could use the company shop to help some
members of their community frame up the walls for an addition to their
church. When he picked up his mail that day, he was shocked. In it was
a letter from the U.S. EPA and it was not non-threatening. Instead, it
stated that he had ``violated'' provisions of the RMP, would be
required to enter into a Consent Agreement and had to respond within 10
days as to which training class he would attend. If he did not reply to
the Agency within 10 days (that would be by December 26, 2005) he would
be subject to $32,500 per day penalties and possible criminal penalties
or imprisonment. Ronnie said to me ``Jean, what have I done wrong?'' I
thought my Dept of Ag inspection went fine. I have never received a
letter from the U.S. EPA in all my years at this plant. Am I going to
jail? He was sick at heart and I was sick for him. Again, this was less
than 10 days before Christmas.
Ronnie's inspection was performed on December 7, 2004 so it was
over a year before he received any indication that he was not in full
compliance with the RMP, and yet he had only 10 days during the
Christmas holidays to respond or face monetary penalties that would put
him out of business. If this is not bad enough, the RMP class that EPA
committed to teach at the IFCA convention was NOT listed on the letter.
Ronnie asked me why the IFCA class was not an option on the letter,
because I had told our members, based on EPA's verbal commitment on
November 30, that it would be. I had no answer for Ronnie but told him
I could contact Region V immediately. His was not the only phone call
we received at IFCA. Our phones began to ring in earnest and the
concerns expressed by the dealers were as serious as Ronnie's and
worse. I wondered how things could have gone so wrong after the
positive meeting we had with Region V on November 30. In sending out
these letters, they did not uphold any of the commitments they made to
us at that meeting nor did they extend IFCA the courtesy of informing
us ahead of time that they would not be good to their word.
For nearly all of our dealers, this was the first violation letter
they had ever received from the U.S. EPA and they are not used to the
legal language and stern wording in the letters. They were stunned,
upset, angry and confused. From the tone of the letter you would think
our entire industry was on the brink of catastrophic and on-going
ammonia releases. I was very worried that some of our members wouldn't
pick up their mail until after Christmas and would miss the 10 day
turn-around and be fined or worse. If nothing else, where was the
common sense on behalf of the Agency?
Immediately, that day on December 19, 2005 I called Mark Horwitz at
Region V to talk to him about these letters, why they were being sent
right before Christmas, to express concern about their enforcement tone
and ask why they did not list the IFCA training class as one of the
choices. I got his voice mail stating he would be out of the office
until January. I then reached out to Tom Skinner, the Administrator of
Region V, by email literally begging him to have his staff stop sending
the letters until after Christmas and until after we could address the
missing IFCA training class. Thankfully, he had the Deputy Director
call me back the next day and we got a temporary reprieve. After a few
more phone calls with Region V staff the IFCA training class was added
to the list of classes and the U.S. EPA had to re-send the letters
after Christmas with the IFCA class offered as an option for training.
Keep in mind that our members would also have to enter into Consent
Agreements within 90 days, something which troubled me greatly. I felt,
as did others in our industry, that we had legal grounds to challenge
the CAFO requirement if nothing else. Region informed me that CAFOs
were ``the least onerous tool in their enforcement toolbox'' and that
was the best they could do. But I still felt it was not justified.
However, with our small budget IFCA does not have the resources to hire
an attorney to take on the Federal Government. Our members also do not
have these resources. IFCA is a three-person Association and the
majority of our members are small businesses. As such, it is difficult
if not impossible to defend our industry against the Government in a
court of law without bankrupting ourselves. Therefore, we rely on our
good name and our solid reputation to try to work things out and that
is exactly what I did, working often with Tom Skinner and Deputy
Director Bharat Mathur to try to come to some kind of reasonable
resolution to this issue. I have great respect for these two gentlemen
and in my conversations with them, I always felt that they did
understand our concerns. Unfortunately, so much damage had been done by
the time they intervened that the perception of the U.S. EPA by our
members was that of a renegade Agency out to shut down their
businesses. In one short year, we went from a cooperative industry/
Agency effort to a complete meltdown of trust and unfortunately a lack
of belief by our members in the U.S. EPA's ability to ever treat them
fairly. It will be hard to undue the damage and you can sense the on-
going frustration of our members in the statements they have submitted
for the committee record.
The Alleged Violations
If all this were not bad enough, the violations cited by the U.S.
EPA and listed in the letters were based on the Agency's interpretation
of the State Dept of Ag reports. The majority of the violations were
procedural or paperwork discrepancies at best; at worst, and in many
cases, the violations did not match up with the findings of the Dept of
Ag inspection report. Copies of the inspection reports were not
provided to our members, only a letter listing their violations. Our
members who utilized the compliance services of Asmark were cited as
well, even though other U.S. EPA regions have reviewed the Asmark RMP
model and found it fully meets the requirements of the RMP rule. But in
Illinois, Region V found it deficient. Where is the consistency in
that? I honestly don't believe any of our facilities could have met the
expectations of the staff in Region V; the violations cited were vague
and in many cases completely incorrect. I also feel that the IL Dept of
Ag was not kept informed of how their reports were interpreted or
utilized. The good name and reputation of Illinois Dept of Agriculture
and its inspectors have also been tarnished by the way Region V managed
this pilot program. But what happened was not the fault of the
Department of Agriculture nor does our industry blame them for the
unfortunate role they played in what was supposed to be a cooperative
program.
Being found out of compliance with a Federal regulation is one
thing, but being singled out for enforcement is quite another. Region V
did not contract with the Department of Ag in any other State to
conduct inspections. Ammonia facilities in the other Region V States of
Wisconsin, Minnesota, Indiana, Michigan and Ohio were not, and have
not, been subject to whole-sale inspection or enforcement in this
manner by Region V. In Ohio, the State EPA administers the RMP
compliance programs, and in Ohio similar types of RMP deficiencies were
treated like this: The manager got a simple and unthreatening letter
asking him to work to improve a certain part of the RMP; the Ohio EPA
would then follow-up to check his progress. This is a fair, respectable
and cooperative approach that works well.
But because the Illinois dealers and IFCA cooperated with the U.S.
EPA and supported this pilot RMP inspection program in Illinois, we
were threatened with monetary penalties, received violation notices,
and our dealers would be required to submit to a Consent Agreement
Final Order and be on record as being in violation of the Clean Air
Act. This is how our facilities who filed their RMPs were treated,
while the Agency, in my opinion, made no real effort to locate and
inspect facilities in Illinois that DID NOT file an RMP, they only
ordered inspections for facilities that did their best to comply with
this regulation because they know who they were, thus making them easy
to inspect and easy to target for enforcement.
Congress Intervenes
Word of what was going on in Illinois made its way through our
industry. Many of my counterparts and fertilizer dealers in other
States observed what was happening in Illinois with a sense of shock as
well as a sense of relief that it wasn't them. I felt at the time I had
done all I could do as a representative of the industry to work with
the U.S. EPA on a reasonable approach for compliance. We had, after
all, talked them out of the $500 per facility penalties, but certainly
many issues remained including the CAFOs.
In late December 2005, I became aware that Senator James Inhofe had
made an inquiry into the issue of Region V enforcement of the RMP and
the impact on the Illinois fertilizer dealers. I believe it was due to
the intervention of Senator Inhofe and his staff that Region V
reconsidered the CAFO provision and withdrew this regulatory
enforcement requirement. Instead, they provided our ammonia facility
managers with a ``Certificate of Compliance'' that requires them to
certify, under threat of perjury, that to the best of their reasonable
knowledge and belief, they are in compliance with all provisions of the
RMP. While this Certificate is a less threatening enforcement
requirement than a CAFO, many of our members still have concerns with
signing the Certificates of Compliance because they still do not fully
understand the violations they were cited for nor do they completely
understand what Region V expects them to do to fully satisfy the
requirements of the RMP. Again, it goes back to lack of education,
outreach and communication with industry.
I have to share with you, after months of feeling run over by the
U.S. EPA it was very uplifting to know that there was someone in
Washington DC who did care about the agricultural industry and the
small business person. I have no doubt that without Chairman Inhofe's
inquiry into our situation, the Illinois fertilizer dealers would have
been forced into the CAFO process and had a permanent blot on their
otherwise clean compliance records for handling anhydrous ammonia.
is the end in sight?
In March 2006 IFCA requested that Region V extend the compliance
date for our members to complete and return their Certificate of
Compliance. We made this request because otherwise, the requirement
falls right in line with the spring planting and post-emerge spraying
season which is the busiest 6 months for our industry. Given the fact
that this RMP pilot program has been going on now for 3 plus years,
extending the compliance date to December 31, 2006 was reasonable in
our opinion. Region V instead extended it to July 1, 2006 which has
still caused stress for our members in that the spray season is still
going strong.
summary
Over time, with substantial effort on our part and by making direct
and constant appeals for nearly a year to Region V staff and management
and with the intervention of Katherine English, we were able to avoid
monetary penalties and consent agreements. All the while, our
Association, The Fertilizer Institute and the Asmark Institute have
worked diligently to further improve RMP compliance tools for our
industry. No doubt many ammonia dealers in the country will benefit
from this unfortunate situation in Illinois and will also utilize our
improved compliance tools, but the fact remains that Illinois
fertilizer facility managers are still dealing with the vague
instructions given by Region V personnel and are spending days revising
their RMPs to try to address violations that in most cases never
existed in the first place.
Our Illinois dealers will always be on record in Region V as not
meeting the standards of the RMP when in fact Illinois dealers are in
fact among the most responsive in the country to the mandates of this
and other regulations. At times I blame myself for being so open to
this pilot program; had IFCA opposed this process our Dept of Ag would
likely have refused to participate and our ammonia facility managers
would be going safely about their business as are others in the country
instead of worrying about $32,500 per day possibilities. Situations
like this certainly erode trust in the regulatory process. That is
perhaps the MOST unfortunate outcome of this event.
The greatest flaw in the U.S. EPA's enforcement program, I believe,
is that it is not uniform, and in many cases the Agency personnel are
not familiar with the industry they are trying to regulate. The RMP is
not the only example, there are other examples I can provide including
the U.S. EPA filing criminal charges against an Illinois pesticide
applicator for a spray drift incident. This is the first time that we
know of that the U.S. EPA has filed criminal charges against an ag
retailer and its employees for a pesticide application event. The
federal judge in the Southern Illinois District recently dismissed this
case in its entirety but only after our member spent a quarter of a
million dollars defending their employees from criminal prosecution in
a case that should never have been filed by the U.S. EPA in the first
place. For nearly a year, two hard-working certified pesticide
applicators at Wabash Valley Service Company spent sleepless nights
worried about going to federal prison and wondering how they would
support their families. While all of this was going on with the RMP, it
was doubly disconcerting to learn of the Wabash Valley case. It has not
been a good year in Illinois with regard to industry and the U.S. EPA
enforcement initiatives in our State.
Some Agency staff seem to be trained only to respond with
enforcement and penalties while industry is begging for outreach, for
cooperation, and for clear guidance. It is not clear to me if the U.S.
EPA headquarters is fully aware of what is going on until industry is
forced to go to the top to try to secure fair treatment. Going to the
top is not something we like to do. We prefer to work with staff and
the Regions because they are the ones we have the most communication
with on many issues. I will say that when we managed to get the
attention of the Region V Administrator and Deputy Administrator, they
were responsive and easy to talk to. I have great respect for Tom
Skinner and Bharat Mathur as I have known and worked with both of them
for many years, back to the days when they were at the Illinois EPA.
But at the point when they got involved, so many poor decisions had
already been made and executed by their staff that it was difficult
even for them to stop the train of miscommunication and enforcement
because the damage had already been done.
When people outright ignore or violate a regulation or cause injury
or harm, enforcement is justified and we support its swift application.
In our case, we did our best to comply with a complex regulation, we
welcomed the U.S. EPA's pilot inspection program and the Illinois
fertilizer dealers got severely penalized for our efforts.
We want the industry to be responsive to Government, but we want
Government to be responsive as well. Among all levels of Federal
Government it seems that U.S. EPA Regions are notoriously independent
and can initiate enforcement for alleged violations that other Regions
do not consider violations at all. Industry asks only for the
Government to communicate with us in a sensible manner, and to give us
the benefit of the doubt, particularly when our safety record warrants
that respect. We do know what we are doing despite the complexity of
the regulations issued by the Agency.
Thank you for this opportunity today.
__________
Statement Richard W. Waterman, Chair Department of Political Science,
University of Kentucky
I would like to begin by thanking Senator Inhofe for inviting me to
speak before the Senate Environment and Public Works Committee. I have
been asked to testify regarding regional variations in EPA enforcement,
a subject that I have studied in relationship to the National Pollutant
Discharge Elimination System (NPDES). My testimony will address three
basic themes. First, I will examine whether there is evidence that
regional variations exist in EPA water enforcement. Second, I will
discuss the role of EPA Regional Administrators and third I will
discuss what I believe is the legitimate role of elected official in
overseeing or controlling the bureaucracy. I should note that I have
examined each of these areas in my research, with, respectively, Susan
Hunter of West Virginia University, Robert Wright and Amelia Rouse,
formerly of the University of New Mexico, and B. Dan Wood of Texas A&M
University.
The first question is whether there is evidence that regional
variations can be found in the way the Environmental Protection Agency
enforces the law. We expect variations to exist simply because there
are vast regional differences in what Susan Hunter and I called the
nature of the ``regulatory environment.'' As we wrote, ``In addition to
its diverse sources of water and equally, if not more so, diverse
sources of pollution, the United States is a conglomeration of
geographical regions with differing environmental situations and
problems. Each region has different geography, economic basis,
population densities, and political pressures.'' Thus, considerable
variation is expected in the overall enforcement numbers. In fact, when
asked for and were provided with enforcement data from the EPA NPDES
(covering the years 1975-1988) we indeed found wide variations in the
number of enforcement actions from region to region. These variations
may have been the result of some of the factors we described above.
When, however, we controlled for a variety of these factors including
the budget for each region, as well as measures of House and Senate
oversight and court penalties assessed in each region, we still found
variations in EPA inspection activity in 7 out of the 10 regions.
Likewise, when we examined EPA referrals to the Justice Department, a
higher level enforcement activity, we still found variations in four
out of the ten regions. Hence, our results provided empirical evidence
that regional variations exist, even when we control for other relevant
economic and political factors. Again, it is important to note that
some of this variation is understandable, given the different
circumstances that EPA enforcement personnel face in each region. We
therefore should not expect uniform enforcement across all regions. But
variations do exist.
One reason why they exist could be found in the then operative 1986
NPDES Enforcement Manual. The manual advised EPA NPDES enforcement
personnel that, ``While it would be difficult, but not necessarily
effective, to have identical enforcement responses for identical
violations in different States, the enforcement should be directly
related to the severity of the violation.'' The manual then continued,
``Given the decentralization of authority and responsibility in
carrying out the NPDES program, implementation of the basic EMS
principles should produce national consistency, while still
accommodating differences between Regions and States.'' The enforcement
manual therefore called for promoting two contradictory goals:
``national consistency'' while ``accommodating'' State and regional
differences. Given this contradictory goal, it is not surprising that
many EPA enforcement personnel, as well as bureaucrats working at the
State level who have primacy to enforce the NPDES permit program, have
approached enforcement in substantially different ways. In some States
and regions, where there is more local pressure for aggressive
enforcement, enforcement has reflected these goals. In other States and
regions where there is an expectation that enforcement should be based
on a negotiated approach with the regulated industry enforcement has
been less aggressive. Thus, as a result of these differing regulatory
expectations, combined with the very real geographical and other issues
I described above, regional variations are bound to occur. If Congress
is committed to limiting such discretion it will have to ensure that
environmental laws are written more specifically so that it limits the
potential for such discretion. More consistent oversight of EPA
officials, not merely in Washington, but throughout the country is
appropriate, as well. But it should be recognized that some variations
in enforcement will continue to exist, even if all of these measures
are adopted. Congress can reduce the level of regional variations, but
it cannot eliminate them entirely.
Beyond the factors promoting regional variations that I have just
described, there is another important reason for variations in EPA
enforcement. To my knowledge this has been a largely overlooked area in
academic studies of the EPA. Scholarly work tends to focus their
attention on the activities of States with primacy or on the EPA
officials in Washington, DC. Yet, most EPA employees operate not in
Washington, but in various regional offices around the country. These
regional offices represent a major reason for variations in
enforcement. EPA officials that I spoke to at the Washington or
national office, during the Presidencies of both George H. W. Bush and
Bill Clinton, described considerable frustration with the enforcement
activities of the regional EPA offices. This suggests to me that this
is not a Democratic or a Republican problem, as frustration with
regional variations was expressed during periods when both Democrats
and Republicans controlled the White House, as well as when Democrats
and Republicans controlled Congress. Both parties appear to be
interested in a more uniform style of enforcement, even if they don't
ultimately agree on what that style should be; that is, whether it
should reflect a strict enforcement approach or a style that emphasizes
a greater level of negotiating with business.
With regard to regional variations one particular appointive
position stood out as the subject of concern. Most memorably, several
years ago when I asked one top Agency official in the EPA Water Office
why there was so much variation in enforcement from region to region, I
was surprised to be treated to a rather candid and colorful exposition
of how a particular regional administrator was enforcing the law, not
in accordance with the wishes of the then current presidential
administration, but rather in accord with the desires of the
``political culture'' of that region. When I asked for more detail on
this point I was informed that some regions are naturally more
aggressive in their enforcement zeal, while others are not. I was told
that regional administrators represented one of the last vestiges of
the practice of ``senatorial courtesy'' and that often the
administrators represented the political viewpoints of the region
rather than national interests.
As a result of this and other discussions with EPA, State
enforcement personnel, and members of environmental groups, I
ultimately conducted two surveys with two of my graduate students from
the University of New Mexico. One was a survey of the attitudes of EPA
NPDES personnel, the other of State bureaucrats working for the New
Mexico Environment Department. Among the many questions on our surveys,
we asked how much influence do various policy actors have over how your
office enforces the law. We asked bureaucrats to rank these policy
actors on a five-point-scale from ``no influence'' to ``a great deal of
influence.'' Among EPA officials regional administrators narrowly
ranked first (in terms of their perceived mean level of influence) with
the EPA Administrator ranking second. It should be noted that they
ranked much higher than the Federal courts (third), Congress (fourth),
environmental groups (fifth), public opinion (sixth), and the president
(seventh). When we asked State officials the same question they ranked
the New Mexico Governor first, the State legislature second, the U.S.
EPA Administrator third, the U.S. Congress fourth, the New Mexico
Finance Committee fifth, and then the Region Six administrator sixth.
It is not surprising that State officials would rank EPA officials
lower (even though New Mexico does not have primacy over its water
program). What was surprising to us, however, was that Regional
Administrators were seen as having essentially the same level of
influence as the EPA Administrator among EPA enforcement personnel, and
that both were seen as having more influence than either Congress or
the president, though a few people did note the obvious point that the
president appoints the EPA Administrator and the Regional
Administrators. Among State NMED personnel, however, they were more
likely to look to their State officials and then to the national EPA
office for guidance, though regional administrators were still seen as
exerting considerable influence.
What our results suggest, then, is that particularly among EPA
bureaucrats, Regional Administrators are perceived as exerting
considerable influence. Given the obvious frustration expressed by U.S.
EPA officials regarding Regional Administrators, it is also clear that
this is a point of contention within EPA itself. In particular, there
is a sense that EPA Regional Administrators tend to reflect the
viewpoints of their regional offices and personnel rather than the
national office. One EPA official in the national office said that
Regional Administrators tend to be co-opted by personnel in their
offices, as well as by the political culture of their region. Again, I
want to note that this level of frustration has been expressed to me in
conversations that I had with EPA officials during both Democratic and
Republican administrations.
What then is the solution? As I noted earlier, it is unreasonable
to expect enforcement to be precisely the same in each region. There
are some valid reasons for regional variations and it would not be
appropriate to force a one-size fits all approach on all regions. We
want some flexibility in order to prevent the problem of what two
prominent scholars, Bardach and Kagan, referred to as the problem of
``regulatory unreasonableness,'' where regulations that simply do not
fit are forced to apply to businesses simply to promote the goal of
uniform enforcement. A stricter enforcement approach may be required in
some settings and in some regions, while negotiation may be appropriate
in others. These decisions should be based on the existing regulatory
needs of each region (and subject to congressional oversight) rather
than merely the decision of a particular Regional Administrator.
In this process it is clear that elected officials have a
legitimate role in overseeing the bureaucracy. First, while presidents
often pay close attention to the qualities of their national EPA
officials, past experience suggests that they are less attentive to the
types of individuals they appoint to the regional EPA offices. This may
be due to the fact that they inherently believe that such officials
will follow directives from US EPA. Since my research suggests this is
not the case, the first recommendation is that presidents should be
more attentive when they appoint Regional Administrators. As noted,
these ten officials are perceived by EPA officials to have slightly
more influence than the EPA Administrator. Presidents of both parties
should be aware of this point when they make these appointments.
Beyond appointments, which is clearly identified in the
Constitution as a means of presidential oversight of the bureaucracy,
is it appropriate for elected officials to have continuing oversight of
the bureaucracy? I believe the answer here is yes. In an extended
research agenda that I conducted with B. Dan Wood, we found that not
only can presidents can influence the bureaucracy through the
appointments they make, but also that the budget is a powerful means of
controlling the bureaucracy. We also found that congressional oversight
of the EPA exerted some influence, as well, though the impact was more
temporary. In fact, what we refer to as ``political control of the
bureaucracy'' can be conceptualized as part of our necessary system of
checks and balances. While our Constitution is largely silent on the
bureaucratic State, it is clear that elected officials can and should
exert influence over the bureaucracy. Bureaucrats have a wide array of
expertise that should not be ignored, but elected officials represent
the public interest in a different way. They can make sure that
bureaucrats are applying the law fairly and in accordance with the
intent of Congress, as well as representing public opinion. Each is an
important attribute. Thus, while bureaucrats clearly have a legitimate
role in enforcing laws as enacted by Congress, Congress and the
president have an equally legitimate right to make sure that the law is
being enforced as intended. Here, of course, there will always be
debate as to what did the law intend and is it being implemented
fairly. These are political questions that will be decided according to
the political interests of a particular time. The fundamental point,
however, is that elected officials have a legitimate role in this
process and in fact they shirk their responsibility if they do not act
to oversee the bureaucracy's performance.
In this particular case, given the prominence of Regional
Administrators in the enforcement process, and the existence of
regional variations in EPA enforcement (and it should be noted that
these variations exist beyond the NPDES program), Congress has a
legitimate role in determining how much variation should be permissible
and whether Regional Administrators should be more loyal to the
regional offices in which they serve or the national EPA office.
______
Response by Richard W. Waterman to addition questions
from Senator Jeffords
Question 1. In 2005 you wrote, ``What we can say for sure is that
some level of discretion is required for bureaucrats to perform their
jobs. The more technical the job is, the more discretion they are
likely to require.'' In your opinion, how does this assertion apply to
EPA's enforcement regime?
Response. Some level of discretion is indeed required. As I noted
in my testimony it is unreasonable to consider a one-size fits all
approach to EPA enforcement. The problem that I noted was that there is
considerable variation in EPA enforcement at the regional level,
particularly with regard to the NPDES program. In work that I published
with Susan Hunter (Enforcing the Law: The Case of the Clean Water Acts)
we empirically examined variations in EPA enforcement. We found that
factors such as the population size of each State, the population
density of each State, the amount of surface water in each State, and
sources of non-point pollution--all factors that are factors related to
what we call the ``regulatory environment''--explain a large part of
the variation in EPA enforcement (e.g., permits issued, enforcement
actions taken). These are factors that explain why we cannot expect
consistent enforcement to occur all the time across all EPA regions.
However, even when we control for these factors (with regard to EPA
enforcements) we still found statistically significant variations in
the enforcement behavior of three EPA regions (3, 6, and 9). In short,
while regulatory environmental factors explain many of the variations
in EPA enforcement, some structural factors also account for variation.
This then leaves us with a normative question. Is this structural
variation, evidence of discretion, acceptable? Again, as I noted in my
testimony, when I have spoken to EPA officials during both Democratic
and Republican administrations I have been told that there is concern
with these regional variations in EPA enforcement. Obviously, during
Democratic administrations there is a greater desire for more
consistent and vigorous enforcement, while Republican administrations
generally favor a less aggressive regulatory approach. Thus, the answer
to how much discretion is acceptable is a political question. I can
only point out that (1) it does exist and (2) there are genuine reasons
why we want some level of EPA bureaucratic discretion to continue.
Question 2. You discuss in your testimony data gathered between
1975 and 1988 with which you conclude there existed a significant
regional variation in EPA enforcement on the National Pollutant
Discharge Elimination System. Have you analyzed any data on the subject
collected after 1988?
Response. Yes. Susan Hunter and I analyzed data from 1988 to 1994
in our book. In addition, Amelia Rouse, Robert Wright and I examined
survey data which we collected on the EPA NPDES enforcement program
from May to September 1994.
Question 3. You mention in your testimony that EPA officials you
spoke with during the presidencies of George H.W. Bush and Bill Clinton
expressed considerable frustration with the enforcement activities of
the regional EPA offices. Is this anecdotal evidence that speaks merely
to the dissatisfaction of a few individuals or have you conducted a
systematic survey of EPA employees leading you to conclude that
feelings of frustration with regional enforcement are widespread
throughout EPA?
Response. The conversation with individuals from the administration
of George H. W. Bush were preparatory to the writing of Enforcing the
Law: The Case of the Clean Water Acts. Susan Hunter and I were
interested in explaining how bureaucrats themselves perceive the
regulatory process. We therefore did a number of interviews with
officials at the EPA (including a visit to the U.S. EPA Water Office),
as well as individuals from the environmental community at large. The
results from this book then led to a second project which I conducted
with Amelia Rouse and Robert Wright. We again interviewed a number of
individuals in EPA regional offices as we put together a survey
instrument on EPA enforcement. The object here was to understand how
bureaucrats see the political world around them. Our work was published
in two articles in the Journal of Public Administration Research and
Theory as well as in our book Bureaucrats, Politics, and the
Environment.
Question 4. Which enforcement activities have you monitored over
the last 18 years?
Response. I have analyzed EPA enforcement in several projects over
the past two decades. My dissertation, which was published in 1989 as
Presidential Influence and the Administrative State included a chapter
on EPA. I then examined the EPA air, water, hazard waste, and pesticide
divisions in work published in various journals, as well as in the book
Bureaucratic Dynamics, with my co-author B. Dan Wood. This then led to
work published with Susan Hunter, Amelia Rouse, and Robert Wright.
Question 5. In the past 10 years, how many scholarly books or
articles have you published on the subject of regional variation in EPA
enforcement activity? Please provide citations.
Response. I have examined EPA and its activities extensively
throughout my career. Many of these deal with regional variations in
EPA enforcement, or variations in enforcement between different
organizational units with EPA. My publications in this area include the
following:
Waterman, Richard W. 2005. ``The Myth of the Envirocrat." The
Environmental Forum. 22 (2) March/April 18-23.
Waterman, Richard W., Amelia Rouse, and Robert L. Wright. 2004.
Bureaucrats, Politics, and the Environment. Pittsburgh: University of
Pittsburgh Press.
Waterman, Richard W. and Amelia A. Rouse.1999. ``The Determinants
of the Perceptions of Political Control of the Bureaucracy and the
Venues of Influence.'' Journal of Public Administration Research and
Theory. 9 (October): 527-569.
Waterman, Richard W., Amelia A. Rouse, and Robert L. Wright. 1998.
``The Venues of Influence: A New Theory of Political Control of the
Bureaucracy.'' Journal of Public Administration Research and Theory. 8
(January): 13-38.
Hunter, Susan and Richard W. Waterman. 1996. Enforcing the Law: The
Case of the Clean Water Acts. Armonk, NY: M. E. Sharpe.
Wood, B. Dan and Richard W. Waterman. 1994. Bureaucratic Dynamics:
The Role of Bureaucracy in a Democracy. Boulder, CO: Westview Press.
Wood, B. Dan and Richard W. Waterman. 1993. ``The Dynamics of
Political-Bureaucratic Adaptation.'' American Journal of Political
Science. 37 (May): 497-528.
Waterman, Richard W. and B. Dan Wood. 1993. ``Policy Monitoring and
Policy Analysis.'' Journal of Policy Analysis and Management. 12
(Fall): 685-699.
Hunter, Susan and Richard W. Waterman. 1992. ``Determining an
Agency's Regulatory Style: How Does the EPA Water Office Enforce the
Law?'' Western Political Quarterly. 45 (June): 401-417.
Wood, B. Dan and Richard W. Waterman. 1991. ``The Dynamics of
Political Control of the Bureaucracy.'' American Political Science
Review. 85 (September): 801-828.
Waterman, Richard W. 1989. Presidential Influence and the
Administrative State. Knoxville: University of Tennessee Press.
Question 6. You wrote in Bureaucratic Dynamics that the bureaucracy
has a responsibility to the American people to provide some
bureaucratic resistance in order to ensure the policy decisions and
laws of previous Congresses and administrations are honored. When you
say in your testimony that ``some regions are more aggressive in their
enforcement while others are not'', do you attribute this zeal to
positive bureaucratic resistance?
Response. It may be. In some cases, as I note above, variations may
be the result of responses to variations in the nature of the
regulatory environment in different States and regions. Obviously,
there is a simplistic tendency to blame bureaucrats whenever we see
variations in enforcement. This should not be the case. We are better
served when we understand the nature of these variations.
Question 7. You mention in your testimony that an EPA official told
you that regional administrators tend to be co-opted by personnel in
their offices, as well as by the political culture of their regions.
Was this a singular conversation or have you conducted extensive
research across EPA regions on this subject?
Response. This was a single conversation with top official from the
EPA Water Office at the U.S. EPA. It was, in fact, one of the top EPA
officials.
Question 8. In response to follow-up questions, you suggested that
the EPA regional ``structure itself might be the problem'' and that
perhaps elimination of the regional management structure should be
considered. You said, ``If you want flexibility, the States can provide
that.'' Which of your published works would lead you to make this
assertion?
Response. There has been a move in recent decades toward greater
State enforcement of environmental regulation, with the national EPA
acting as the watch dog when States have primacy. Under this
arrangement States must act consistent with national laws, but they
have greater flexibility in terms of how they do so. This opens the
door for variations in enforcement, but there are essentially capped by
EPA oversight. If States are not doing there job then EPA can
intervene. In addition, EPA does spot inspections and enforcements to
ensure that States are doing there job. This system is not perfect, but
it does suggest that there now may be some redundancy in the EPA
organizational structure. Regions originally connected the U.S. EPA to
the States. With the States doing more of the job themselves, it may be
time to rethink how the regional structure works. The alternative of
creating yet another layer of bureaucracy at the EPA national level to
keep an eye on the regional EPA bureaucracy is unlikely to work. It
will create more bureaucracy without necessarily creating better
bureaucracy. I am merely suggesting that all options be put on the
table. I am not recommending that this option be adopted. I would not
do so without considerable study and a clearer sense of the
implications of this structural reform. But I do think it is worth
considering.
Question 9. In your testimony, you refer to a study that you
conducted in the 1990s which surveyed US EPA regional employees in New
Mexico. How many U.S. EPA employees did you survey, and does this
number represent a statistically viable sample of all U.S. EPA
employees in that year?
Response. We surveyed the universe of EPA NPDES enforcement
personnel and NMED enforcement personnel. The response rates in both
cases were in the 30 percent range. Obviously, we would have preferred
higher response rates, but the primary means of doing so (conducting
telephone interviews) was not available to us because many enforcement
personnel in EPA regions share the same desk and anonymity therefore
could not be protected under these circumstances. Some EPA regional
administrators also would not allow us to conduct the survey under
these circumstances. Thus, the survey results must be considered with
these limitations in mind. They do provide a valuable insight into the
minds of Federal and State bureaucrats regarding how they see the
political world around them. But the survey results are far from
perfect. Clearly with better resources and more cooperation from
central EPA we would love to do a survey again that would allow us to
increase the survey response rate.
__________
Statement of Eric Schaeffer, Director Environmental Integrity Project
Thank you, Mr. Chairman and members of the Senate Environment
Committee, for the opportunity to testify today on the need for greater
consistency in enforcing federal environmental laws. My name is Eric
Schaeffer, and I am currently the director of the Environmental
Integrity Project, a nonprofit organization dedicated to more effective
environmental enforcement. Until March of 2002, I was Director of the
U.S. Environmental Protection Agency's Office of Civil Enforcement, so
the topic of today's hearing is a familiar one.
EPA has been charged by Congress with enforcing nineteen
environmental laws in fifty States that regulate the discharge of
pollution from a wide range of economic activity. Responsibility for
most enforcement activity--including inspections, and the levying of
fines and penalties for violations--has been delegated to State
agencies that also issue and review the federal permits that are
supposed to limit pollution from refineries, power plants, animal
feedlots, and thousands of other large sources.
Not surprisingly, in a country as large and diverse as our own,
States vary widely in both the competence and the philosophy that they
bring to bear on these important responsibilities. In practice, that
means that violators can flout federal environmental law in some States
without fear of penalty, or having to worry that their violations will
be detected at all. This divergence between States is the greatest
source of inconsistency in the enforcement of federal law--if we want
to provide law abiding companies with a level playing field, this
problem needs to be addressed head on.
The Inspector General and the U.S. General Accounting Office have
painstakingly documented the failure of some States to enforce our
environmental laws in a series of reports issued over the past decade.
Their findings are sobering, and worth reviewing.
On April 14, 1997, the Inspector General's review of enforcement of
federal hazardous waste laws advised that, ``State penalty policies are
inconsistent from State to State,'' and pointed out that some State
agencies did not bother to recover the economic benefit that companies
realized by ignoring federal hazardous waste laws. Separate IG reviews
in 1999 found that Virginia, ``rarely classified violators with serious
RCRA violations as `Significant Non-Compliers,''' while Rhode Island's
Department of Environmental Management did not, ``(1) issue appropriate
and timely enforcement actions; (2) ensure that violators complied with
enforcement schedules, and (3) identify significant non-compliance.''
In Rhode Island, the IG concluded that the problems resulted from ``a
lack of management commitment to enforcement.''
On September 25, 1998, the IG concluded that its audits of air
enforcement in Alaska, Maryland, Massachusetts, New Mexico,
Pennsylvania, and Washington had, ``disclosed fundamental weaknesses
with State identification and reporting of significant violations of
the Clean Air Act. This occurred because States either did not want to
report violations or the inspectors were unable to detect them.
Numerous significant air violations went undetected, and many of these
were not reported to EPA.'' Where the 6 States identified only 18
significant violators, the Inspector General's office found 103 in the
same fiscal year, after examining only a fraction of State records.
A similar audit of Idaho's air enforcement program in 1998 reached
similar conclusions, finding that the State's ``enforcement actions
were not appropriate and penalties not enough to deter violations;
enforcement activities did not result in a timely return of sources to
compliance; inspection procedures did not ensure that significant
violators were identified, and data was not reported accurately.''
The beat goes on. In 2002, the U.S. General Accounting Office found
that, ``over one half of the States do not inspect all of the tanks
frequently enough to meet the minimum rate recommended by EPA, at least
once every 3 years.'' In 2003, the IG issued a particularly scathing
report on Louisiana's implementation of Federal programs, finding that
the State's RCRA database contained many errors, and that, ``Louisiana
did not know whether facilities were in compliance because self-
monitoring reports were either not submitted by facilities or could not
be located.'' Just last year, the IG documented wide variations in
monitoring of Clean Air Act sources between Texas, New York, North
Carolina and Ohio.
To be sure, not all of these reviews have been negative. For
example, the IG applauded the Illinois EPA's enforcement of hazardous
waste laws in a 1999 audit, and noted efforts by North Carolina to
improve Clean Water Act permitting of large animal feedlots. State
attorneys general from New York and a handful of other States have
sometimes shown that they are more than willing than EPA to crack down
on some of the country's most powerful polluters.
Nor can all the inconsistency in environmental enforcement be
charged to States. The U.S. EPA shares the responsibility for enforcing
most federal environmental statutes, and is the exclusive authority for
enforcing a handful of laws, like the Toxic Substances Control Act,
Federal right to know laws that established the Toxics Release
Inventory, and tailpipe standards for cars and trucks in every State
but California. While headquarters determines policy and manages a few
key cases, most federal enforcement is carried out by staff in 10
different regional offices who report to 10 different Regional
Administrators, each separately appointed by the President. This
fragmentation of responsibility has led to significant variations in
regional enforcement, although I think it's fair to say these
differences are not as dramatic as they are between States.
Like many other problems in Government, inconsistent federal
enforcement is easier to diagnose than it is to cure, and has persisted
through various changes in Administration. As long as responsibility is
shared by EPA and State agencies, we are going to need to tolerate some
diverse approaches to environmental enforcement, which is not
necessarily a bad thing. States need room to innovate, and in any case,
divided Government is part of our constitutional framework.
But so is the idea that citizens deserve equal protection under the
law, which becomes meaningless if polluters can virtually ignore
Federal environmental laws in some parts of the country. Although we
will never achieve perfection, we need to do our best to provide both
the regulated industry and the public with a level playing field.
Although there are no silver bullets, there are some actions that
could help to improve the consistency of environmental enforcement.
Both EPA and State agencies are understaffed relative to their
workload, which means that some of the largest facilities can go years
without ever seeing an inspector. Permit fees provide a source of
revenue that can be more reliable than annual appropriations, and both
Congress and State legislatures should assess whether these are
sufficient to meet program needs.
Both the IG and the GAO have recommended that major sources of
pollution be required to use State of the art monitoring to track
emissions, instead of the inaccurate accounting still in use at many
facilities, which amount to little more than guesswork. Instead, the
U.S. EPA has rolled back emissions monitoring to accommodate industry
lobbyists, despite having been reprimanded twice for such actions by
the DC Circuit Court of Appeals.
EPA needs to make enforcement expectations clearer for States
running Federal programs. Some States may welcome this clarity; the GAO
reported in 2002 that 40 of the States it surveyed would support a
Federal mandate to inspect all underground storage tanks periodically,
since that could provide the leverage to secure adequate funding from
their State legislatures.
Unfortunately, there is no substitute for regular oversight of
State programs, and this is probably EPA's toughest job. Nobody likes
to be audited, and the Agency will have to exercise this responsibility
with sensitivity and skill. Outstanding efforts need to be recognized,
but the Agency must have enough leverage to step in and at least
temporarily manage enforcement activity where a State's program is
clearly deficient.
Congress can help by asking the right questions and sending the
right signals to both EPA and State agencies. Unfortunately, I cannot
think of a single hearing that either the Senate or the House has
scheduled in the last 10 years to address any of the repeated concerns
that the IG or the GAO have raised about uneven enforcement of Federal
environmental laws. Unless I am mistaken, today's hearing was prompted
by complaints from a trade association that EPA was not polite enough
when offering to waive all penalties, if its member companies would be
kind enough to voluntarily comply with risk management requirements
that have assumed particular importance after 9/11.
Such voluntary programs can be a valuable adjunct to enforcement,
and perhaps EPA was not as tactful as it could have been when
describing the terms of the amnesty it was offering in exchange for
compliance. But if Congress is concerned about inconsistency, I would
respectfully suggest that the biggest problem by far is the lack of any
meaningful environmental enforcement at all in some of the most heavily
polluted parts of our country. This shortfall has been thoroughly
documented by the Government's own auditors over the last decade, and I
hope you will give their work the serious attention it deserves.
______
Responses by Eric Schaeffer to additional questions
from Senator Jeffords
Question 1. Can you discuss a few recent examples where a lack of
any meaningful EPA enforcement has jeopardized human health and the
environment?
Response. The failure to enforce environmental laws leaves the
public exposed to pollution that is both dangerous and illegal. Most
obviously, the U.S. EPA's decision to stop enforcing Clean Air Act New
Source Review rules against some of the nation's dirtiest power plants
mean that these ``grandfathered'' facilities continue to release
millions of tons of sulfur dioxide, nitrogen oxide, and particulate
matter every year. Companies like Cinergy, which had announced an
agreement to clean up its power plants in December of 2000 to resolve
New Source Review violations, abandoned that commitment in 2001 when
EPA reversed direction. Other companies that had expressed an interest
in settlement decide to litigate instead.
Emissions from coal-fired power plants contribute to acid rain,
smog, and fine particle pollution that EPA estimates contributes to
hundreds of thousands of asthma attacks and more than twenty thousand
premature deaths every year. New Federal standards for reducing
exposure to fine particle pollution will help reduce this appalling
toll over the next ten years, but enforcement of NSR rules could have
helped reduce needless exposure to these contaminants much earlier.
Millions of Americans live within breathing distance of large
petrochemical plants that every year release large volumes of toxic
pollutants like butadiene and benzene, as a result of accidents,
maintenance activity, and plant startup and shutdown. For example, the
BASF plant in Port Arthur, Texas, released a combined total of 175,000
pounds of butadiene in 2003 during ``malfunctions'' and related
maintenance activities. Both pollutants are known human carcinogens. In
theory, unpermitted emissions during such events are prohibited by law,
but in practice, the law is almost never enforced. The Environmental
Integrity Project asked the U.S. Environmental Protection Agency to
investigate a disturbing pattern of ``upsets'' at petrochemical plants
in Port Arthur in March of 2003.
For the last 5 years, the U.S. EPA has refused to enforce laws that
require large animal feeding operations to account for their air
emissions, and to control such pollution where it is significant.
Unlike family farms, modern livestock operations warehouse hundreds of
thousands of animals in close quarters, where they can be a major
source of both air and water pollution in rural communities. EPA has
stopped enforcing right-to-know and Clean Air Act laws since 2001,
instead opting to provide the industry with long-term amnesty pending
further research and data collection. This refusal to act means that
those unlucky enough to live near these factory farms will continue to
inhale hydrogen sulfide, ammonia, particulate matter, and other noxious
pollutants that ought to be monitored and controlled.
Question 2. Can you discuss an example where an industry-wide
enforcement approach led to positive results for the regulated industry
and for the environment?
Almost 8 years ago, the U.S. EPA developed a strategic initiative
to target chronic and serious violations of the Clean Air Act at the
Nation's largest oil refineries. The strategy identified four types of
violations that seemed to have the most significant impact on human
health and the environment: expansion of ``grandfathered'' units
without New Source Review permits, benzene released illegally from
wastewater treatment, volatile organic compounds off-gassed from valves
and flanges, and sulfur dioxide and other pollutants released from
flares at sulfur recovery units and other operations. The Agency
publicized its concern about these violations through Enforcement
Alerts and at industry trade conferences, invited industry
representatives to negotiate consent decrees that would establish an
enforceable framework and schedule for fixing these problems, and made
clear that the underlying requirements would be enforced.
To date, 85 refineries representing 85 percent of U.S. capacity are
operating under one of these consent decrees, leveraging several
billion dollars of investment in scrubbing, flare recovery systems, and
other clean technologies that will greatly reduce the pollution that
was too long accepted as an inevitable byproduct of the refining
process. The U.S. EPA expects that the consent decrees will eventually
eliminate more than 80,000 tons of nitrogen oxide annually, and 235,000
tons of sulfur dioxide per year. These investments in cleaner refining
have obviously not hurt the industry, which continues to report record
profits, but should make a measurable difference in the quality of the
air that people breathe in the neighborhoods around these plants. The
EPA's refinery initiative is proof of what can be accomplished when the
Agency targets the most serious violations within an industry sector,
and pursues a consistent and determined enforcement strategy.
__________
Statement of David Paylor, Executive Director, Virginia Department of
Environmental Quality, Officer, Environmental Council of States
Thank you, Mr. Chairman, for providing the Environmental Council of
the States (ECOS) the opportunity to present testimony on the
interactions between the State environmental agencies and EPA's
Regional Offices. My name is David Paylor, and I am the Director of the
Virginia Department of Environmental Quality and an officer in our
national association ECOS. Today I am speaking on behalf of the
environmental agencies in our member States as well as my own State.
background
The Environmental Council of States is the national non-partisan,
non-profit association of State and territorial environmental
commissioners. Each State and territory has some Agency, known by
different names in different States, that corresponds to the U.S.
Environmental Protection Agency. Our members are the officials who
manage and direct the environmental agencies in the States and
territories. They are the State leaders responsible for making certain
our nation's air, water and natural resources are clean, safe and
protected.
States have the challenging job of front-line implementation of our
Nation's environmental pollution laws. States have increased their
capacity and as environmental protection has become increasingly
important to the general public, more and more responsibilities have
been moved to the level of Government best able to carry them out--
State and local Governments--which are best able because they are
closest to the problems, closest to the people who must solve the
problems, and closest to the communities which must live with the
solutions.
Today States are responsible for:
Managing more than 75 percent of all Federally delegated
environmental programs;
Instituting 95 percent of all environmental enforcement
actions;
Collecting nearly 95 percent of environmental monitoring
data; and
Managing all State lands and resources.
These responsibilities have become even more challenging in the
face of severe budget deficits. About two thirds of the $15 billion
States spend annually on environment and natural resources originate
from non-federal sources.
relationship between epa's regional offices and the states
The State environmental agencies' primary contact with the U.S. EPA
is via one of the ten Regional Offices. Former members of ECOS,
including a former ECOS President and the former Executive Director of
the organization, currently lead five of these offices. For the most
part, State relationships with these offices are good.
Most of the major national environmental programs are delegated to
the States, and we regularly work with the regions on these matters. As
part of this delegation, States negotiate a ``Performance Partnership
Agreement'' or a ``State-EPA Memorandum of Understanding'' with the
regional office each year, or in some cases every few years. This PPA
or MOU leads to a grant from which the typical State gets about 20-33
percent of its operating funds to implement the national programs, such
as the Clean Air Act, the Clean Water Act, and so on.
Another significant contact that States have with the EPA regional
offices is receiving new federal rules to implement. Since 2000, States
have received about 40 new rules each year (in air, wastewater,
drinking water, waste, etc.) to add to the already formidable list of
environmental responsibilities that the States have.
Yet another significant contact between States and the regional
offices is on enforcement issues. Enforcement of the environmental laws
is a responsibility of the States to which EPA has delegated the
programs. EPA's role should be to assist the States when requested and
to oversee the efficacy of the States' programs, and to assure that
there is a ``level playing field'' of enforcement among all the States
and all the EPA regional offices.
While State relationships with the regional offices are usually
good, they have failed to perform as expected on occasion. ECOS often
hears about these problems from our members, and we can summarize our
observations into four areas:
1) Enforcement problems
2) EPA is slow to provide grants to State environmental agencies
3) Difficulties that States and regions have with NPM guidances
4) Failure to reduce regional staff after delegations
1. Consistency in Enforcement Among Regional Offices and Related Issues
In January 2004, the ECOS Compliance Committee outlined its
concerns about inconsistencies among EPA's regional offices in the
Agency's review of State enforcement and compliance efforts. Among the
States' concerns was the belief that EPA's oversight of State
enforcement programs was not consistent or predictable from one region
to the next. This dialogue led to the EPA-ECOS ``State Review
Framework,'' which is a significant commitment of both the Agency and
the States to revise the manner in which EPA reviews State enforcement
efforts.
This effort is currently underway and remains an active joint
project of ECOS and EPA. ECOS appreciates Congress' interest in this
subject, but we do not think this subject is ripe for Congressional
action.
However, States continue to have difficulties with EPA inspectors
who conduct inappropriate actions within delegated States. For example,
in Nebraska EPA staff from the regional office recently showed up at
the State environmental Agency to look through NPDES files for ``cases
so we can get our enforcement numbers up.'' When the State staff
suggested that it needed assistance with basic inspections in a part of
the State, the EPA staff declined to assist.
Recommendation. ECOS recommends that Congress ask the Agency for a
joint report from it and the States on progress being made in
implementing the State Review Framework, with the report due on March
1, 2007.
2. Grant Problems
States rely on Federal STAG funding--the Categorical Grants and the
Infrastructure Grants--to assist them in implementing the delegated
programs. In a typical State environmental Agency budget, about 25
percent of the income is from Categorical Grants, but this can vary
from a low of about 5 percent to a high of about 50 percent depending
on the program and the State. States particularly rely on federal funds
for support of certain parts of their programs.
When EPA fails to provide federal grant funds in a timely manner,
States may find it difficult to operate the programs due to cash flow
problems. For example, in the current fiscal year, Region IV was unable
to provide all the STAG grants to Tennessee within the first 3 months
of the current Federal fiscal year. Of 12 major grants, only 3 were
awarded within the first 3 months of the fiscal year, even though the
State's application had been submitted before the new fiscal year
began. EPA took over 6 months to award four of the grants, and one
grant has still not been awarded, as of June 23, 2006. As you might
imagine, the lack of timely Federal funds to operate various delegated
programs in air, water, drinking water and waste puts a significant
stress on the cash flow of the State Agency and its ability to operate
these programs.
This is by no means an isolated case. On June 6-7, 2006 States and
EPA staff met to discuss this very issue. The summary report stated:
``An issue of great importance to the workgroup (and the States in
general) is grant timeliness. When the grant cycle suffers delays, it
affects the States' ability to promptly implement the programs. The
group discussed several approaches to resolving this problem, including
better defining the roles and responsibilities of the State grant
managers and the EPA program managers, allowing flexibility, and
promoting consistency across the regions.'' A similar conclusion was
present in EPA's December 23, 2005 memorandum entitled ``Timely Award
of State and Tribal Continuing Environmental Program Grants.''
Recommendation. ECOS recommends that Congress instruct the Agency
to issue continuing grants (i.e., the Categorical Grants in the STAG
account) to States and tribes no later than 90 days after the passage
of EPA's budget, and to provide authorization for States and tribes to
draw on those accounts at least every 90 days during the fiscal year.
3. NPM Guidances
As we indicated in the above issue, States negotiate with EPA
regional offices each year on a work plan that leads to the STAG
Categorical Grants. These negotiations are very extensive, covering
every delegated program that States have taken from EPA in water,
drinking water, waste and air. States rely on ``National Program
Manager Guidance'' to assure that rules are implemented similarly
across the nation.
Unfortunately, the guidances are not always communicated in a clear
manner as they move from EPA headquarters to the Regional offices and
to the States. Our experiences show that interpretations of the
guidance that have sometimes led to confusion about how States should
implement the rules.
For example, Oklahoma recently determined that the cooling water
discharge from a facility was exempt from a certain rule. EPA initially
agreed with the facility that asked the Agency's opinion. However, when
the State Agency contacted EPA to confirm this, the Agency hedged. The
result was that it is not clear from the guidance whether the facility
is exempt or not.
In another example from the same State, a facility petitioned the
State that it should be treated as two separate facilities under PSD
(an air rule). The State tended to agree, but asked the region to
confirm that the interpretation was consistent with existing EPA
guidance on the subject. However, the Agency did not respond and the
State therefore was forced to act unilaterally.
Inconsistencies from State to State occur when (1) EPA does not
interpret its rules in a timely manner, (2) it excessively interprets
them, and/or (3) it adds additional requirements to the rules so as to
change them or make them unimplementable.
4. Size of Staff in Regional Offices
In 1992, EPA conducted a study that determined that about 45
percent of the delegated programs had been actually delegated to the
States. At that time, EPA had about 18,000 employees.
By 2002, about 75 percent of the programs had been delegated to the
States--a considerable shift of the workload. However, EPA's staff was
still about 18,000.
During this 10-year period only one new environmental program was
created, the Safe Food Act of 1996.
While we understand that EPA has many responsibilities, many States
are unsure why the number of staff at the Agency remained the same
while the bulk of the Agency's responsibilities for implementation of
its programs was being handed to the States. At the same time, States
do not have sufficient information to recommend to you whether EPA's
regional staff should be reduced, not has ECOS taken such a position.
Recommendation. ECOS suggests that Congress review the relationship
between the rules and programs delegated to the States from the period
1992 through current and the size of the Regional Office staff required
to continue other Agency responsibilities.
recommendations
In addition to the recommendations listed in our testimony above,
ECOS recommends the following delineation of appropriate roles as an
approach to appropriate roles:
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Thank you, Mr. Chairman, for this opportunity to testify.
______
Responses by David Paylor to additional question
from Senator Jeffords
Question 1. In discussions with the EPA Inspector General and GAO,
both organizations have referenced the new ``State Review Framework.''
Your organization partnered with EPA to draft the framework. While your
testimony mentions the program, can you discuss in greater detail you
current impressions of the program? Is it working?''
Response. The States partnered with EPA on the ``State Review
Framework'' (the Framework) to address two principal concerns. First,
the States find that EPA's oversight of delegated State programs is
inconsistent between EPA Regions and between States in the same EPA
Region. Second, the States want EPA's oversight to be predictable,
repeatable and unbiased. Oversight should also eliminate redundancy.
The ``State Review Framework'' (the Framework) is a management tool
designed to provide consistent oversight of State performance in
enforcement and compliance assurance programs. Developed by EPA with
input from the States, its purpose is to ensure compliance with the
nation's environmental laws, and maintain fair and consistent
enforcement of those laws across the country. Delegation agreements
between EPA and the States govern State implementation and enforcement
of core environmental programs under Federal statutes. The Framework
identifies 12 areas for EPA's evaluation of State compliance and
enforcement performance in these core programs. A 13th area evaluates
``uniqueness'' in State programs, highlighting how States are providing
for flexibility and innovation--often needed to address environmental
or administrative problems not envisioned in the law.
The Framework relies on existing guidance and policies, avoids the
creation of new requirements, and is not inconsistent with performance
partnership agreements and grants. By design it should improve resource
allocation, allow for reduced oversight of many States based on
performance, and facilitate and monitor continuous program improvement.
It should also provide EPA with the foundation necessary to evaluate
it's own enforcement activities as well as reevaluate it's guidance and
policies. EPA piloted the Framework in 10 States, one in each EPA
Region. After completion of the pilots, the Framework was evaluated and
revised, and EPA provided training to State and Federal employees on
the Framework methodology. To date an additional 20 States have
participated in reviews by EPA's Regional offices. EPA's goal is to
complete the reviews and conduct a full evaluation of the Framework in
2007.
We agree with GAO that it is too early to determine the actual
effectiveness of the Framework. We do know, based on the pilots and the
reviews conducted to date, that there is a considerable amount of work
to be done. The ECOS Compliance Committee is refocusing its efforts on
the core program components, Elements 1-12. The reductions in the State
and Tribal Grant Programs, Federal funds provided to the States to
implement core programs, are making it critical to use the Framework to
identify opportunities to reduce duplicative work, deploy our
workforces differently, and engage in more effective work sharing. It
remains to be seen if we can accomplish all of these efficiencies given
the changes which will be required in both the Federal and State
workforces and their management. However, both EPA and the States
remain committed to our goals.
Question 2. Can you discuss from a State perspective the process
for determining annual enforcement targets for delegated programs? Who
determines those targets? EPA regional offices, the States, or both? Is
the focus primarily on a few large violators or several smaller ones?
Response. The States are responsible for the enforcement of
environmental programs as they are defined in delegation agreements.
For example, if a State is delegated the National Pollutant Discharge
Elimination System (NPDES) permit program under the Clean Water Act,
then the State issues permits governing discharges to waters of the
State and enforces the terms and conditions of the permits. Annual
enforcement targets can address priorities within, or focus for, such
delegated programs. In the water example, the issuance and enforcement
of NPDES permits for sources of a particular pollutant into the
Chesapeake Bay by the bordering States could be an annual target.
Difficultly can arise when nationally-set annual targets impact State
delegated programs in unintended ways.
For example, national program managers (NPMs)--Senate confirmed
Assistant Administrators in EPA Headquarters--in the air, water, waste,
pesticide and toxics programs issue annual guidance establishing
national program priorities as does EPA's enforcement program. Not
infrequently, national guidance can redirects critical resources to
national emergencies like Hurricane Katrina recovery. Such redirection
of resources can undermine a State's ability to manage a delegated
program. For example, not too long ago, EPA's enforcement program
conducted a ``national dry cleaners initiative'' to address human
health risk associated with the industry; for some States, however, dry
cleaners were simply not sufficiently numerous to be a priority--air
emissions from other major sources were.
The NPM guidance is directed to EPA's Regional Offices, which are
responsible for the oversight of delegated State programs as well as
implementation of national priorities in different areas of the
country. The Regions address national and annual targets in their work
planning negotiations with the State through memoranda of/or
performance partnership agreements and grants. As we noted in our
testimony, difficulties arise when national guidance is not always
clearly communicated as it moves from Headquarters to the Regions, and
through the Regions to the States. Problems can also arise in the
interpretation of national guidance by the Region and/or regional
staff. And, although the States have been provided opportunities to
comment on NPM guidance, and the EPA Regions have the authority to
approve work plans that do not follow national guidance, neither
mechanism appears to have any real impacts on annual targets.
Work plan negotiations may also include Regional priorities that
layer additional requirements on State programs. While the negotiations
between the Region and the State continue, Federal funding can be, and
frequently is, ``held hostage. States rely on grant programs
established by Federal statutes to partially fund implementation of
delegated programs. Our testimony provides specific examples of the
impacts of the lack of timely grant awards on State programs. These
problems exacerbate the current trend of declining State grants in a
tight Federal fiscal environment, including a fairly recent practice of
directing the use of State grant funds for national priorities, without
sufficient or any additional funding. In the most recent example,
funding provided to the States under section 106 of the Clean Water Act
was awarded contingent on the implementation of a new requirement--that
already stressed State water quality monitoring programs be expanded to
include freshwater lakes.
Question 3. GAO and the EPA Inspector General often site data gaps
as a reason for inconsistent enforcement. Can you discuss the States'
role in collecting and reporting environmental data?
Response. At a minimum, the States collect and report environmental
data in accordance with delegation and grant agreements, and other
cooperative initiatives. Forty-three States responding to a recent ECOS
survey reported data from more than 3 million regulated facility sites
in 2003. Much of the data is submitted to the States by regulated
facilities in compliance with permits, and is generated by the States
through inspection and monitoring activities. In most cases, the States
have additional data collected pursuant to State programs not mandated
by Federal law and/or standards that are more stringent than the
required Federal minimum.
Most States have their own databases to manage and analyze the
information they collect. They also maintain their own applications to
provide for integration of data to produce annual reports, and to look
across both program and industry lines for compliance trends. In these
cases, the States use proprietary applications to ``upload'' or
crosswalk data from their databases to EPA's. (Note: EPA's databases
are not fully integrated.) Over the years, this has been problematic
because each national program has had different approaches for
submitting electronic data to EPA and data systems' crosswalk
applications have failed when respective system upgrades were
delivered. This has resulted in significant historic data gaps. There
are also perceived real time data gaps because while the States have up
to date information in their own systems, EPA usually has only received
data at prescribed intervals. Therefore, a query to an EPA system of
record is likely to result in data results which are not as up to date
as it appears it should be. The development of the National
Environmental Information Exchange Network (Exchange Network) is being
developed to eliminate the interoperability issue between State and EPA
systems and should allow for the synchronization of data between EPA
and States on a more frequent basis. The Exchange Network is also
enforcing the use of data standards.
Where and when EPA has been able to dedicate sufficient resources
to a project, both itself and for the States, and has taken the lead
and worked collaboratively with the States, the quality of national
data systems and the data they manage improves. The States participated
in the Environmental Data Standards Council that identified and
developed data standards and develop data exchange standards for
enforcement and compliance. This has helped improve the quality of data
over the years. Even with the data accessibility, data synchronization
and data standards issues, the ``data gaps'' that impact our ability to
characterize the enforcement of the nation's environmental laws are the
direct result of any number of factors including agreement on how to
measure performance in enforcement programs. As GAO noted in its
testimony, EPA's key management indicators continue to be the number of
inspections conducted and the penalties assessed for noncompliance. In
contrast, many States are focusing on the quality and content of
inspections and the training of staff conducting the inspections. GAO,
EPA's Inspector General, and recently the Office of Management and
Budget have all noted that EPA's performance measures need to
characterize changes in compliance, including compliance rate and other
outcome data.
In addition, EPA performance measures need to acknowledge and
capture State-specific limitations or approaches which may not conform
to standard performance or tracking metrics, such as lack of State
authority to pursue a particular case or action, or referral of cases
to other State agencies with superior jurisdiction. Finally, EPA needs
to develop performance measure methodology to quantify the use of
compliance assistance or other incentive strategies, undertaken in lieu
of or in conjunction with more traditional punitive enforcement
strategies. These programs are more likely to eliminate a source or
prevent pollution, thereby achieving environmental results sooner. We
are working closely with EPA to develop better measures to for these
programs so that we can better characterize our successes.
__________
Statement of John Stephenson, Director, Natural Resources and
Environment, U.S. Government Accountability Office
Mr. Chairman and members of the committee, I am pleased to be here
today to discuss our work on the Environmental Protection Agency's
(EPA) difficulties in ensuring consistent and equitable enforcement
actions among its regions and among the States. Our testimony today is
based on reports we have issued on EPA's compliance and enforcement
activities over the past several years,\1\ and provides some
observations from the ongoing work that we are performing at your
request and that of the Subcommittee on Interior, Environment and
Related Agencies, House Committee on Appropriations. As you know, we
are assessing how EPA, in consultation with regions and State agencies,
sets priorities for compliance and enforcement and how the Agency and
the States determine respective compliance and enforcement roles and
responsibilities and allocate resources for these purposes. As part of
this effort, we are assessing EPA's initiated and planned actions to
address key factors that result in inconsistencies--identified in our
previous work--in carrying out its enforcement responsibilities. We
expect to complete this ongoing review on EPA and State enforcement and
issue our report in March 2007.
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\1\ See GAO, Environmental Protection More Consistency Needed Among
EPARegions in Approach toEnforcement, GAO/RCED-00-108 (Washington, DC:
June 2, 2000); Human Capital: Implementing an Effective Workforce
Strategy Would Help EPA to Achieve Its Strategic Goals, GAO-01-812
(Washington, DC: July 31, 2001); and Clean Water Act: Improved Resource
Panning Would Help EPA Better Respond to Changing Needs and Fiscal
Constrains, GAO-05-721 (Washington, DC: July 22, 2005).
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EPA seeks to achieve cleaner air, purer water, and better protected
land in many different ways. Compliance with the nation's environmental
laws is the goal, and enforcement is a vital part of the effort to
encourage State and local Governments, companies, and others who are
regulated to meet their environmental obligations. Enforcement deters
those who might otherwise seek to profit from violating the law, and
levels the playing field for environmentally compliant companies.
EPA administers its environmental enforcement responsibilities
through its Office of Enforcement and Compliance Assurance (OECA).
While OECA provides overall direction on enforcement policies, and
occasionally takes direct enforcement action, many of its enforcement
responsibilities are carried out by its 10 regional offices (regions).
These regions, in addition to taking direct enforcement action, oversee
the enforcement programs of State agencies that have been delegated
authority for enforcing federal environmental protection
requirements.\2\
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\2\ For many Federal environmental programs, EPA either authorizes
States to administer the Federal program or retains authority to
administer the program for the State. The State programs that have been
approved by EPA are described as ``delegated'' in this testimony for
clarity and consistency with EPA program terminology.
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In my testimony today, I will describe the (1) extent to which
variations exist among EPA's regions in enforcing environmental
requirements, (2) key factors that contribute to any such variations,
and (3) status of the Agency's efforts to address these factors.
In summary, as we previously reported on regional efforts to
enforce provisions of the Clean Water Act and the Clean Air Act, the
regions vary substantially in the actions they take to enforce
environmental requirements. These variations show up in key management
indicators that EPA headquarters officials have used to monitor
regional performance, such as the number of inspections performed at
regulated facilities and the amount of penalties assessed for
noncompliance with environmental regulations. For example, in fiscal
year 2000, the number of inspections conducted under the Clean Air Act
compared with the number of facilities in each region subject to EPA's
inspection under the act varied from a high of 80 percent in Region III
to a low of 27 percent in Regions I and II.
We also reported that it is important to understand the reasons for
some of these variations, such as a regional determination to conduct
more in-depth inspections at a fewer number of facilities instead of
conducting less intensive examinations at many more facilities.
Accordingly, we recommended that EPA clarify which enforcement actions
it expects to see consistently implemented across the regions and
direct the regions to supplement its reporting with information that
helps explain why variation occurred. We did not focus our work on the
effects of inconsistent enforcement on various types of businesses,
including small businesses, the particular focus of the committee's
hearing today. However, in performing our work we noted that a recent
study for the Small Business Administration,\3\ as well as other
studies, have suggested that environmental requirements fall most
heavily on small businesses. To the extent that this is the case, small
businesses could be especially disadvantaged by any inconsistencies and
inequities in EPA's enforcement approach. EPA has made progress toward
resolving challenges in its enforcement activities that we have
previously identified. Nonetheless, each of the challenges is complex
and will require much more work and continued vigilance to overcome.
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\3\ W. Mark Crain, The Impact of Regulatory Costs on Small Firms, a
report prepared at the request of the Small Business Administration's
Office of Advocacy (Washington, DC, September 2005).
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Our work has identified several factors contributing to regional
variations: (1) differences in the philosophy of enforcement staff
about how to best achieve compliance with environmental requirements;
(2) incomplete and inadequate enforcement data, which hamper EPA's
ability to accurately determine the extent of variations; and (3) an
antiquated workforce planning and allocation system that is not
adequate for deploying staff to ensure greater consistency and
effectiveness in enforcing environmental requirements.
Finally, EPA recognizes that to ensure fair and equitable
treatment, core enforcement requirements must be consistently
implemented so that similar violations are met with similar enforcement
responses, regardless of geographic location. Accordingly, and in
response to our findings and recommendations, the Agency has initiated
or planned actions that are intended to achieve greater consistency in
regional and State enforcement activities. These actions include the
following:
Developing the State Review Framework. This framework
involves a new process for conducting reviews and measuring the
performance of core enforcement programs in States with delegated
authority (as well as nondelegated programs implemented by EPA
regions). Although the process is a promising means for ensuring more
consistent enforcement actions, it is too early to assess whether the
process will result in more consistent enforcement actions and a level
playing field for the regulated community across the Nation.
Improving management information. EPA has a number of
ongoing activities to improve the Agency's enforcement data, but the
data problems are long-standing and complex. It will likely require a
number of years and a steady top-level commitment of staff and
financial resources to substantially improve the data so that they can
be effectively used to target enforcement actions in a consistent and
equitable manner.
Enhancing workforce planning and analysis. For the past
several years, EPA has taken measures to improve its ability to match
its staff and technical capabilities with the needs of individual
regions and States. For example, EPA developed a human capital strategy
and performed a study of its workforce competencies. Nonetheless, the
Agency still needs to determine how to deploy its employees among its
strategic goals and geographic locations so that it can most
effectively use its resources, including its compliance and enforcement
resources.
EPA's enforcement program depends heavily upon inspections by
regional or State enforcement staff as the primary means of detecting
violations and evaluating overall facility compliance. Thus, the
quality and the content of the Agency's and States' inspections, and
the number of inspections undertaken to ensure adequate coverage, are
important indicators of the enforcement program's effectiveness.
However, as we reported in 2000, EPA's regional offices varied
substantially on the actions they take to enforce the Clean Water Act
and Clean Air Act. Consistent with earlier observations of EPA's Office
of Inspector General and internal Agency studies, we found these
variations in regional actions reflected in the (1) number of
inspections EPA and State enforcement personnel conducted at facilities
discharging pollutants within a region, (2) number and type of
enforcement actions taken, and (3) the size of the penalties assessed
and the criteria used in determining the penalties assessed. For
example, as figure 1 indicates, the number of inspections conducted
under the Clean Air Act in fiscal year 2000 compared with the number of
facilities in each region subject to EPA's inspection under the act
varied from a high of 80 percent in Region 3 to a low of 27 percent in
Regions 1 and 2.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
While the variations in enforcement raise questions about the need
for greater consistency, it is also important to get behind the data to
understand the cause of the variations and the extent to which they
reflect a problem. For example, EPA attributed the low number of
inspections by its Region V, in Chicago, to the regional office's
decision at the time to focus limited resources on performing detailed
and resource-intensive investigations of the region's numerous electric
power plants, rather than conducting a greater number of less intensive
inspections.
We agree that regional data can be easily misinterpreted without
the contextual information needed to clarify whether variation in a
given instance is inappropriate or whether it reflects the appropriate
exercise of flexibility by regions and States to tailor their
priorities to their individual needs and circumstances. In this regard,
we recommended that it would be appropriate for EPA to (1) clarify
which aspects of the enforcement program it expects to see implemented
consistently from region to region and which aspects may appropriately
be subject to greater variation and (2) supplement region-by-region
data with contextual information that helps to explain why variations
occur and thereby clarify the extent to which variations are
problematic.
Our findings were also consistent with the findings of EPA's
Inspector General and OECA that regions vary in the way they oversee
State-delegated programs. In this regard, contrary to EPA policy, some
regions did not (1) conduct an adequate number of oversight inspections
of State programs, (2) sufficiently encourage States to consider
economic benefit in calculating penalties, (3) take more direct federal
actions where States were slow to act, and (4) require States to report
all significant violators. Regional and State officials generally
indicated that it was difficult for them to ascertain the extent of
variation in regional enforcement activities, given their focus on
activities within their own geographic environment. However, EPA
headquarters officials responsible for the air and water programs noted
that such variation is fairly commonplace and does pose problems. The
director of OECA's water enforcement division, for example, told us
that, in reacting to similar violations, enforcement responses in
certain regions are stronger than they are in others and that such
inconsistencies have increased.
Similarly, the director of OECA's air enforcement division said
that, given the considerable autonomy of the regional offices, it is
not surprising that variations exist in how they approach enforcement
and State oversight. In this regard, the director noted, disparities
exist among regions in the number and quality of inspections conducted
and in the number of permits written in relation to the number of
sources requiring permits.
In response to these findings, a number of regions have begun to
develop and implement State audit protocols, believing that having such
protocols could help them review the State programs within their
jurisdiction with greater consistency. Here, too, regional approaches
differ. For example:
Region 1, in Boston, has adopted a comprehensive
``multimedia'' approach in which it simultaneously audits all of a
State's delegated environmental programs.
Region 3, in Philadelphia, favors a more targeted approach
in which air, water, and waste programs are audited individually.
In Region V, in Chicago, the office's air enforcement
branch chief said that he did not view an audit protocol as
particularly useful, noting that he prefers regional staff to engage in
joint inspections with States to assess the States' performance in the
field and to take direct federal action when a State action is
inadequate.
We recognize the potential of these protocols to achieve greater
consistency by a region in its oversight of its States, and the need to
tailor such protocols to meet regional concerns. However, we also
believe that EPA guidance on key elements that should be common to all
protocols would help engender a higher level of consistency among all
10 regions in how they oversee States.
While EPA's data show variations in key measures associated with
the Agency's enforcement program, they do little to explain the causes
of the variations. Without information on causes, it is difficult to
determine the extent to which variations represent a problem, are
preventable, or reflect appropriate regional and State flexibility in
applying national program goals to unique circumstances. Our work
identified the following causes: (1) differences in philosophical
approaches to enforcement, (2) incomplete and inaccurate national
enforcement data, and (3) an antiquated workforce planning and
allocation system.
While OECA has issued policies, memorandums, and other documents to
guide regions in their approach to enforcement, the considerable
autonomy built into EPA's decentralized, multilevel organizational
structure allows regional offices considerable latitude in adapting
headquarters' direction in a way they believe best suits their
jurisdiction. The variations we identified often reflect different
enforcement approaches in determining whether the region should (1)
rely predominantly on fines and other traditional enforcement methods
to deter noncompliance and to bring violators into compliance or (2)
place greater reliance on alternative strategies, such as compliance
assistance (workshops, site visits, and other activities to identify
and resolve potential compliance problems). Regions have also differed
on whether deterrence could be achieved best through a small number of
high-profile, resource-intensive cases or a larger number of smaller
cases that establish a more widespread, albeit lower profile,
enforcement presence. Further complicating matters are the wide
differences among States in their enforcement approaches and the
various ways in which regions respond to these differences. Some
regions step more readily into cases when they consider a State's
action to be inadequate, while other regions are more concerned about
infringing on the discretion of States that have been delegated
enforcement responsibilities. While all of these approaches may be
permissible, EPA has experienced problems in identifying and
communicating the extent to which variation either represents a problem
or the appropriate exercise of flexibility by regions and States to
apply national program goals to their unique circumstances.
OECA needs accurate and complete enforcement data to determine
whether regions and States are consistently implementing core program
requirements and, if not, whether significant variations in meeting
these requirements should be corrected. The region or the State
responsible for carrying out the enforcement program is responsible for
entering data into EPA's national databases. However, both the quality
of and quality controls over these data were criticized by State and
regional staff we interviewed.
Internal OECA studies have also acknowledged the seriousness of the
data problem. An OECA work group, the ``Targeting Program Review
Team,'' stated that key functions related to data quality, such as the
consistent entry of information by regions and States, were not working
properly and that there were important information gaps in EPA's
enforcement-related databases. Another OECA work group concluded in
2006, ``OECA managers do not have available to them timely, complete,
and detailed analyses of regional or national performance.'' A third
OECA work group asserted that the situation has deteriorated from past
years, noting:
``managers in the regions and in OECA headquarters have become
increasingly frustrated that they are not receiving from [the Office of
Compliance] the reports and data analyses they need to manage their
programs. . . [and there] has been less attention to the data in the
national systems, a commensurate decline in data quality, and
insufficient use of data by enforcement/compliance managers.''
Consistent with our findings and recommendations, EPA's Office of
Inspector General recently reported that, ``OECA's 2005 publicly-
reported GPRA [Government Performance and Results Act] performance
measures do not effectively characterize changes in compliance or other
outcomes because OECA lacks reliable compliance rates and other
reliable outcome data. In the absence of compliance rates, OECA reports
proxies for compliance to the public and does not know if compliance is
actually going up or down. As a result, OECA does not have all the data
it needs to make management and program decisions. What is missing
most, the biggest gap, is information about compliance rates. OECA
cannot demonstrate the reliability of other measures because it has not
verified that estimated, predicted, or facility self-reported outcomes
actually took place. Some measures do not clearly link to OECA's
strategic goals. Finally, OECA frequently changed its performance
measures from year to year, which reduced transparency.'' For example,
between fiscal years 1999-2005, OECA reported on a low of 23
performance measures to a high of 69 measures, depending on the fiscal
year.
Although EPA is working to improve its data, the problems are
extensive and complex. For example, the Inspector General recently
reported that OECA cannot generate programmatic compliance information
for five of six program areas; lacks knowledge of the number, location,
and levels of compliance for a significant portion of its regulated
universe; and concentrates most of its regulatory activities on large
entities and knows little about the identities or cumulative impact of
small entities. Consequently, the Inspector General reported, OECA
currently cannot develop programmatic compliance information,
adequately report on the size of the universe for which it maintains
responsibility, or rely on the regulated universe data to assess the
effectiveness of enforcement strategies.\4\
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\4\ EPA Office of Inspector General, Limited Knowledge of the
Universe of Regulated Entities Impedes EPA's Ability to Demonstrate
Changes in Regulatory Compliance, Report No. 2005-P-00024, September
19, 2005.
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As we reported, EPA's process for budgeting and allocating
resources does not fully consider the Agency's current workload, either
for specific statutory requirements, such as those included in the
Clean Water Act, or for broader goals and objectives in the Agency's
strategic plan. Instead, in preparing its requests for funding and
staffing, EPA makes incremental adjustments, largely based on
historical precedents, and thus its process does not reflect a bottom-
up review of the nature or distribution of the current workload. While
EPA has initiated several projects over the past decade to improve its
workload and workforce assessment systems, it continues to face major
challenges in this area
If EPA is to substantially improve its resource planning, we
reported, it must adopt a more rigorous and systematic process for (1)
obtaining reliable data on key workload indicators, such as the quality
of water in particular areas, which can be used to budget and allocate
resources, and (2) designing budget and cost accounting systems that
are able to isolate the resources needed and allocated to key
enforcement activities.
Without reliable workforce information, EPA cannot ensure
consistency in its enforcement activities by hiring the right number or
type of staff or allocating existing staff resources to meet current or
future needs. In this regard, since 1990, EPA has hired thousands of
employees without systematically considering the workforce impact of
changes in environmental statutes and regulations, technological
advances in affecting the skills and expertise needed to conduct
enforcement actions, or the expansion in State environmental staff. EPA
has yet to factor these workforce changes into its allocation of
existing staff resources to its headquarters and regional offices to
meet its strategic goals. Consequently, should EPA either downsize or
increase its enforcement and compliance staff, it would not have the
information needed to determine how many employees are appropriate,
what technical skills they must have, and how best to allocate
employees among strategic goals and geographic locations in order to
ensure that reductions or increases could be absorbed with minimal
adverse impacts in carrying out the Agency's mission.
Over the past several years, EPA has initiated or planned several
actions to improve its enforcement program. We believe that a few of
these actions hold particular promise for addressing inconsistencies in
regional enforcement activities. These actions include (1) the creation
of a State Review Framework, (2) improvements in the quality of
enforcement data, and (3) enhancements to the Agency's workforce
planning and analysis system.
The State Review Framework is a new process for conducting
performance reviews of enforcement and compliance activities in the
States (as well as for nondelegated programs implemented by EPA
regions). These reviews are intended to provide a mechanism by which
EPA can ensure a consistent level of environmental and public health
protection across the country. OECA is in the second year of a 3-year
project to make State Review Framework reviews an integral part of the
regional and State oversight and planning process and to integrate any
regional or State corrective or follow-up actions into working
agreements between headquarters, regions, and States. It is too early
to assess whether the process will provide an effective means for
ensuring more consistent enforcement actions and oversight of State
programs to help ensure a level playing field for the regulated
community across the country. Issues that still need to be addressed
include how EPA will assess States' implementation of alternative
enforcement and compliance strategies, such as strategies to assist
businesses in their efforts to comply with environmental regulations;
encourage businesses to take steps to reduce pollution; offer
incentives (e.g., public recognition) for businesses that demonstrate
good records of compliance; and encourage businesses to participate in
programs to audit their environmental performance and make the results
of these audits and corrective actions available to EPA, other
environmental regulators, and the public.
Regardless of other improvements EPA makes to the enforcement
program, it needs to have sufficient environmental data to measure
changes in environmental conditions, assess the effectiveness of the
program, and make decisions about resource allocations. Through its
Environmental Indicators Initiative and other efforts, EPA has made
some progress in addressing critical data gaps in the Agency's
environmental information. However, the Agency still has a long way to
go in obtaining the data it needs to manage for environmental results
and needs to work with its State and other partners to build on its
efforts to fill critical gaps in environmental data. Filling such gaps
in EPA's knowledge of environmental conditions and trends should, in
turn, translate into better approaches in allocating funds to achieve
desired environmental results. Such knowledge will be useful in making
future decisions related to strategic planning, resource allocations,
and program management.
Nevertheless, most of the performance measures that EPA and the
States are still using focus on outputs rather than on results, such as
the number of environmental pollution permits issued, the number of
environmental standards established, and the number of facilities
inspected. These types of measures can provide important information
for EPA and State managers to use in managing their programs, but they
do not reflect the actual environmental outcomes that EPA must know in
order to ensure that resources are being allocated in the most cost-
effective ways to improve environmental conditions and public health.
EPA also has worked with the States and regional offices to improve
enforcement data in its Permit Compliance System and believes that its
efforts have improved data quality. EPA officials said that the system
will be incorporated into the Integrated Compliance Information System,
which is being phased in this year. According to information EPA
provided, the modernization effort will identify the data elements to
be entered and maintained by the States and regions and will include
additional data entry for minor facilities and special regulatory
program areas, such as concentrated animal feeding operations, combined
sewer overflows, and storm water. Regarding the National Water Quality
Inventory, the Office of Water recently began advocating the use of
standardized, probability-based, statistical surveys of State waters so
that water quality information would be comparable among States and
from year to year.
While these efforts are steps in the right direction, progress in
this area has been slow and the benefits of initiatives currently in
the discussion or planning stages are likely to be years away from
realization. For example, initiatives to improve EPA's ability to
manage for environmental results are essentially long-term. They will
require a long-term commitment of management attention, follow-through,
and support--including the dedication of appropriate and sufficient
resources--for their potential to be fully realized. A number of
similar initiatives in the past have been short-lived and unproductive
in terms of lasting contributions to improved performance management.
The ultimate payoff will depend on how fully EPA's organization and
management support these initiatives and the extent to which identified
needs are addressed in a determined, systematic, and sustained fashion
over the next several years.
Since the late 1990s, EPA has made progress in improving the
management of its human capital. EPA's human capital strategic plan was
designed to ensure a systematic process for identifying the Agency's
human capital requirements to meet strategic goals. Furthermore, EPA's
strategic planning includes a cross-goal strategy to link strategic
planning efforts to the Agency's human capital strategy. Despite such
progress, effectively implementing a human capital strategic plan
remains a major challenge. Consequently, the Agency needs to continue
monitoring progress in developing a system that will ensure a well-
trained and motivated workforce with the right mix of skills and
experience. In this regard, the Agency still has not taken the actions
that we recommended in July 2001 to comprehensively assess its
workforce--how many employees it needs to accomplish its mission, what
and where technical skills are required, and how best to allocate
employees among EPA's strategic goals and geographic locations.
Furthermore, as previously mentioned, EPA's process for budgeting and
allocating resources does not fully consider the Agency's current
workload. With prior years' allocations as the baseline, year-to-year
changes are marginal and occur in response to (1) direction from the
Office of Management and Budget and the Congress, (2) spending caps
imposed by EPA's Office of the Chief Financial Officer, and (3)
priorities negotiated by senior Agency managers.
EPA's program offices and regions have some flexibility in
realigning resources based on their actual workload, but the overall
impact of these changes is also minor, according to Agency officials.
Changes at the margin may not be sufficient because both the nature and
distribution of the workload have changed as the scope of activities
regulated has increased and as EPA has taken on new responsibilities
while shifting others to the States. For example, controls over
pollution from storm water and animal waste at concentrated feeding
operations have increased the number of regulated entities by hundreds
of thousands and required more resources in some regions of the
country. However, EPA may be unable to respond effectively to changing
needs and constrained resources because it does not have a system in
place to conduct periodic ``bottom-up'' assessments of the work that
needs to be done, the distribution of the workload, or the staff and
other resource needs.
Mr. Chairman, to its credit, EPA has initiated a number of actions
to improve its enforcement activities and has invested considerable
time and resources to make these activities more effective and
efficient. While we applaud EPA's actions, they have thus far achieved
only limited success and illustrate both the importance and the
difficulty of addressing the long-standing problems in ensuring the
consistent application of enforcement requirements, fines and penalties
for violations of requirements, and the oversight of State
environmental programs. To finish the job, EPA must remain committed to
continuing the steps that it has already taken. In this regard, given
the difficulties of the improvements that EPA is attempting to make and
the time likely to be required to achieve them, it is important that
the Agency remain vigilant. It needs to guard against any erosion of
its efforts by factors that have hampered past efforts to improve its
operations, such as changes in top management and priorities and
constraints on available resources.
Mr. Chairman, this concludes my prepared statement. I would be
happy to respond to any questions that you or members of the committee
may have.
If you have any questions about this testimony, please contact me
at (202) 512-3841 or [email protected]. Major contributors to this
testimony include Ed Kratzer, John C. Smith, Ralph Lowry, Ignacio
Yanes, Kevin Bray, and Carol Herrnstadt Shulman.
______
Responses by John Stephenson to additional questions
from Senator Jeffords
Question 1. In your testimony you cite Clean Air Act inspection
data demonstrating a variation in inspection activity among the regions
in fiscal year 2000. How does the percentage of inspected facilities
vary across fiscal years?
Response. In our testimony, we reported Clean Air Act inspection
data for the most recent fiscal year at the time of our report and did
not compare variation across fiscal years. (See Human Capital:
Implementing an Effective Workforce Strategy Would Help EPA to Achieve
Its Strategic Goals, GAO-01-812, July 31, 2001). However, we reported
in 2000 that earlier observations by EPA's Office of Inspector General
and internal Agency studies are consistent with our findings that
variations in regional actions are reflected in the number of
inspections EPA and State enforcement personnel conducted at facilities
discharging pollutants within a region. For example, fiscal year 1998
EPA data show that regional and State inspection coverage for Clean Air
Act-related programs ranged from a low of 27 percent of facilities
inspected in the Chicago region to a high of 74 percent for facilities
in the Philadelphia region. This compares with about 30 percent and 80
percent of facilities inspected in the Chicago and Philadelphia regions
respectively, in fiscal year 2000.
Question 2. Is it possible that a facility not inspected in fiscal
year 2000 could have been inspected in a later fiscal year?
Response. Yes. EPA's Office of Enforcement and Compliance Assurance
(OECA) relies heavily upon periodic inspections by regional and/or
State enforcement staff as the primary means of detecting violations
and evaluating overall facility compliance. According to the director
of OECA's air enforcement division, because the air program does not
have continuous monitoring, facilities found in compliance some years
ago may fall into noncompliance without being detected unless they are
periodically retested.
Question 3. What factors inhibit GAO from accurately studying the
effects of inconsistent enforcement on various businesses within the
regulated community?
Response. Data on the quality and the content of the Agency's and
States' inspections, and the number of inspections undertaken to ensure
adequate coverage, are important indicators of the enforcement
program's effectiveness. Nonetheless, it is important to get behind
these data by considering contextual information associated with the
data. EPA's data and analyses performed by OECA and EPA's Inspector
General show that variations exist in the quantity and quality of
inspections, the number and type of enforcement actions, and other key
elements of the Agency's enforcement program. However, the data
themselves do little to explain the causes of the variations. Without
causal information it is not possible to determine accurately the
extent to which variation represents a problem, whether it is
preventable, or the extent to which it represents the appropriate
exercise of flexibility towards the regulated community.
Question 4. In your testimony, you cite a Small Business
Administration study that finds, according to your summary,
``environmental requirements fall most heavily on small businesses''.
How do you reconcile this finding with the EPA Inspector General's
determination that EPA ``concentrates most of its regulatory activities
on large entities and knows little about the identities or cumulative
impact of small entities''?
Response. According to an SBA-funded study entitled ``The Impact of
Regulatory Costs on Small Firms'', published in September 2005, small
businesses continue to bear a disproportionate share of the Federal
regulatory burden. Taking into account four types of regulation--
economic, workplace, environmental, and tax compliance--the total
regulatory cost per employee for firms with fewer than 20 employees was
$7,647, with environmental regulation amounting to $3,296 per employee
or 43 percent. However, as the following table shows, the importance of
environmental regulation as a share of total cost per employee
decreases rapidly as the size of the firm increases, with environmental
regulatory costs representing the lowest regulatory cost per employee
for firms with 500 or more employees.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The finding that the costs of complying with environmental rules
falls disproportionately on very small firms is not necessarily
inconsistent with the finding of EPA's Office of Inspector General that
OECA has limited knowledge of the diverse regulated universe for which
it maintains responsibility or that it concentrates most of its
regulatory attention on large entities and knows little about the
identities and cumulative environmental impact of small entities. As
the Inspector General reported in September 2005, EPA's enforcement and
compliance monitoring activities focus on major and large entities or
pollution sources, which represent only a small fraction of the total
universe of entities subject to regulation. OECA has mostly focused on
larger and major entities, and has not conducted or obtained analyses
showing the cumulative impact of the vast number of entities that emit
pollution below the threshold of major or larger entities. EPA has
focused on major and larger entities because any one of the larger
entities, individually, can have a greater impact than any of the
individual smaller entities. However, given the much greater number of
small entities and the potential collective or cumulative impact from
this vast but little understood part of the regulated universe, the
Inspector General's report argued that it is important for OECA to know
the cumulative environmental impact of entities that fall below the
major or large threshold. Improved information on small entities,
including overall numbers and compliance rates, could help OECA better
prioritize where to focus resources and facilitate effective management
of compliance and enforcement activities.
Lastly, in recognition of the environmental compliance burden
imposed on small firms, Congress enacted statutes to protect small
businesses while continuing to regulate their impact on the
environment. The Regulatory Flexibility Act (RFA) and the Small
Business Regulatory Act (SBREFA) were enacted to provide small
businesses with the flexibility and clarity necessary to comply with
Government standards. Various subtitles of these statutes (1) require
the Agency to publish Small Entity Compliance Guides written in plain
language explaining actions a small entity must take to comply with the
rules; (2) require the Agency to support the rights of small entities
in enforcement actions , specifically providing for the reduction (and
in certain cases the waiver) of civil penalties for violations; (3)
provide small entities with expanded authority to go to court to be
awarded attorneys' fees and costs when the Agency is found to have been
excessive in the enforcement of regulations, (4) provide small entities
with expanded opportunities to participate in the development of
regulations; (5) require the Agency to provide Congress and GAO with
copies of all final rules and supporting analyses. Congress may decide
not to allow a rule to take effect.
Question 5. In your testimony, you provide examples of various EPA
auditing protocols that regions employ to oversee State delegated
authority. Specifically, how would a standardized audit tool developed
at the headquarters improve compliance?
Response. In 2004, OECA, EPA Regions, the Environmental Council of
the States (ECOS), and State representatives from each Region
collaborated in the development of a tool to provide consistent
oversight of State performance in core enforcement and compliance
assurance programs. This tool has considerable potential not only for
improving compliance but also for increasing consistency among EPA
regions and encouraging greater uniformity among State compliance and
enforcement programs. Specifically, the purpose of the assessment tool
is to provide a consistent level of environmental and public health
protection across the country and provide a consistent mechanism by
which EPA Regions, working collaboratively with their States, can
ensure that States meet agreed upon performance levels. Known as the
State Review Framework (SRF), the SRF is intended to address issues
raised in EPA Office of Inspector General audits, concerns raised by
ECOS' Compliance Committee, program delegation withdrawal petitions
filed by environmental organizations and others, and other EPA
assessment efforts. The SRF is based on the 1986 guidance memorandum
entitled ``Revised Policy Framework for State/EPA Enforcement
Agreements'' and utilizes existing program guidance, such as EPA's
national enforcement response policies, and civil penalty policies or
similar State policies (where in use and consistent with national
policy) to evaluate State performance and to help guide definitions of
a minimum level of performance.
The SRF consists of twelve core elements that examine major aspects
of a State's compliance and enforcement program plus a thirteenth
element that provides the opportunity to give States credit for
innovative approaches to achieving results in their programs. Examples
of the core elements include: (1) the degree to which a State program
has completed the universe of planned and agreed upon inspections; (2)
the degree to which inspection reports and compliance reviews document
inspection findings, including accurate descriptions of what was
observed to sufficiently identify violations, (3) the degree to which
significant violations are accurately identified and reported to EPA
national databases in a timely manner, and (4) the degree to which a
State takes timely and appropriate enforcement actions, in accordance
with specific EPA policy.
Anticipated benefits of the SRF include, among others: (1) more
strategic resource utilization; (2) reduction of duplicative work; (3)
consistent and predictable baseline oversight with agreed upon
thresholds for corrective action; (4) a level playing field for States
in competition for business, (5) enhanced (or even relaxed) oversight
based on State performance, (6) improved public confidence; and (7)
reduced vulnerability to criticisms regarding EPA's level of oversight
, particularly from the Office of the Inspector General, the Government
Accountability Office (GAO), and the public.
Eleven States participated in a pilot test of the SRF in 2004, one
State in each region, with the exception of region 7 in which two
States divided responsibilities for specific programs. The reviews of
pilot States and Region 10 were all completed by January 2005. EPA
evaluated the results of the pilot reviews in May 2005 with the
participation of key stakeholders such as ECOS, the Association of
State and Territorial Solid Waste Management Officials (ASTWMO), the
Association of State and Interstate Water Pollution Control
Administrators (ASIWPCA), and State and Territorial Air Pollution
Program Administrators/Association of Local Air Pollution Control
Officials (STAPPA/ALAPCO). Reviews of the remaining States are
scheduled to be completed by the end of FY 2007.
Question 6. How has the lack of available compliance and
enforcement data hindered GAO's ability to study regional
inconsistency? What other factors hinder a quantitative analysis?
Response. GAO reported in June 2000 that the lack of reliable
compliance and enforcement data has hindered the ability of EPA and the
Agency's stakeholders, including GAO and the EPA Office of Inspector
General to ascertain the extent to which regional inconsistencies do in
fact exist, the impact they may have on human health and the
environment, and the manner in which they should be addressed. (See
Environmental Protection: More Consistency Needed Among EPA Regions in
Approach to Enforcement, GAO-00-108, June 2, 2000). GAO's findings and
recommendations in its June 2, 2000 report, the Inspector General
reported both in September 2005 and December 2005 that EPA faced
challenges in developing outcome data, such as compliance rates, to
evaluate the effectiveness of the Agency's regulatory activities. The
Inspector General explained, for example, that EPA has limited
knowledge of the regulated universe for which it maintains
responsibility. EPA and others need reliable universe information to
accurately ascertain the scope of EPA's responsibilities and workload
in different regions and evaluate management decisions about regulatory
activities in different regions, for example, the basis on which
regional offices develop targeting strategies, set priorities, and
allocate resources. Universe data also serves as the basis for
calculating compliance rates.
The Inspector General further reported in December 2005 that EPA
focused primarily on measuring activities, or outputs, such as ``number
of enforcement actions'' and ``number of inspections'' because of the
difficulty in demonstrating a direct cause and effect relationship
between specific enforcement and compliance activities, and outcomes
such as the impact the activities may have on human health and the
environment. Without reliable outcome data, EPA, GAO, and other
stakeholders cannot accurately assess the effectiveness of enforcement
strategies in different regions. For example, they cannot accurately
evaluate whether compliance is going up or down, how regions may vary
in this regard, the extent to which regional differences in compliance
rates may result from management and program decisions, and how the
impact of regulations--such as on small entities--may vary between
regions.
Other factors hinder quantitative analysis of regional
inconsistency. EPA headquarters enforcement officials emphasized that
enforcement and compliance data, by themselves, do not always offer the
appropriate context to help determine the extent to which the
variations pose problems because the data do little to explain the
reasons for variations. Without such information, it is difficult to
determine the extent to which variations represent a problem, whether
they are preventable, or the extent to which they reflect appropriate
flexibility in applying national program goals to unique circumstances.
Question 7. Has GAO considered in its enforcement studies how
inconsistent enforcement may negatively impact human health and the
environment?
Response. Our reports have not directly addressed the effect of
inconsistent enforcement on human health or the environment. We
reported that Federal and State enforcement officials agree that basic
program elements should be largely consistent, although some variation
is to be expected. According to EPA, for example, some variation is to
be expected in how regions target resources to the most significant
compliance issues in different regions and States. However, we reported
that it is important for EPA to get behind the data to understand the
causes of apparently wide disparities, in areas such as the quality and
content of inspections, to understand whether they reflect a problem
(for example, to human health or the environment).
Question 8. In your testimony, you note an earlier GAO finding that
EPA does not sufficiently encourage States to consider economic benefit
in calculating penalties. Which Federal environmental statutes require
such a determination in calculating penalties?
Response. We have identified no Federal environmental statutes that
require States to consider the economic benefit of noncompliance when
assessing penalties, nor have we found any statutes that require EPA to
encourage States to make such considerations. However, we did find
several Federal statutes requiring EPA or courts to consider the
economic benefits of noncompliance when assessing penalties for
violations of Federal programs or permits. (See 33 USC 1319(d),
1319(g)(3), 1321(b)(8), 1344(s)(4), 300h-2(c)(4)(B), 7413(e)(1),
7524(b), 7524(c)(2), 7545(d)(1), 9609(a)(3), 11045(b)(1)(C)).
GAO's June 2, 2000 report, ``Environmental Protection: More
Consistency Needed Among EPA Regions in Approach to Enforcement''
relied upon earlier EPA Inspector General audit reports and OECA
regional evaluations for this and several other characterizations of
the regions' oversight of State programs. Among other things, the
Office of Inspector General and OECA reports cited the regions for not
conducting an adequate number of oversight inspections; not
sufficiently encouraging that economic benefit be considered in
calculating penalties; not taking more direct federal actions where
States were slow to act; and not requiring States to report all
significant violations. Regional officials acknowledged at the time
that, at least to some extent, the criticisms were valid.
EPA headquarters has issued basic enforcement policy guidance since
the mid-1980s, the ``Revised Policy Framework for State/EPA Enforcement
Agreements'', with periodic addenda and revisions that consistently
encourage States to consider EPA's penalty policies as they develop
their own penalty policies. The policy framework states, in part, that
``to remove incentives for noncompliance and establish deterrence, EPA
endeavors, through its civil penalties, to recoup the economic benefit
the violator gained through noncompliance. EPA encourages States to
consider and to quantify where possible, the economic benefit of
noncompliance where this is applicable. EPA expects States to make a
reasonable effort to calculate economic benefit and encourages States
to attempt to recover this amount in negotiations and litigation.
States may use EPA's computerized model (know as BEN) for calculating
that benefit or different approaches to calculating economic benefit.
EPA will provide technical assistance to States on calculating the
economic benefit of noncompliance, and has made the BEN computer model
available to States''.
In 1993 a revision to the EPA ``Policy Framework'' reiterated that
it is ``a common goal for penalty assessments at the Federal, State,
and local levels that penalties should seek to recover the economic
benefit of noncompliance at a minimum where appropriate plus a portion
reflecting the gravity of the violation''. In discussing the criteria
for assessment of monetary penalties, the 1993 policy revision states
that ``in order to preserve deterrence, it is EPA's policy not to
settle for less than the amount of the economic benefit of
noncompliance, where it is possible to calculate it, unless the benefit
component is a de minimus amount, the violator demonstrates inability
to pay, there is a compelling public concern, or there are litigation-
related reasons for such settlement. State and local enforcement
agencies should calculate and assess the economic benefit of
noncompliance in negotiations and litigation except under these
circumstances. Where State or local statutory authority would not
specifically authorize recovery of economic benefit, EPA still expects
States to make a reasonable effort to calculate economic benefit and to
attempt to recover this amount in negotiations and litigation using the
State's own statutory criteria. In addition to these factors, EPA
recognizes that some State statutes do not support the equivalent of
the collection of the full economic benefit of noncompliance because of
limitations imposed, such as penalty caps. In such instances, EPA will
work closely with the States to assist them in overcoming these
limitations''.
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