c/EPA United States Environmental Protection Agency Enforcement and Compliance Assurance (2201A) EPA300-N-98-003 March 1998 Audit Policy Update GTE CORRECTS 600 VIOLATIONS THROUGH EPA'S SELF-DISCLOSURE POLICY In the biggest settlement reached un- der the EPA's Audit Policy, EPA and GTE Corporation have come to an agreement that recognizes GTE's cooperation in dis- closing and resolving 600 violations at 314 GTE facilities in 21 states. The violations occurred under the Emergency Planning and Community Right to Know Act (EPCRA) and the Spill Prevention Countermeasure and Control (SPCC) requirements of the Clean Wa- ter Act (CWA). The settlement represents the largest number of sites addressed in a single settlement using the Agency's self-disclosure policy, which became effective January 1996. The settlement also demonstrates the policy's broad scope in promoting compliance at facili- ties nationwide. "GTE is very pleased to have resolved these violations detected during an internal review of the company's operations. The Policy is straightforward, easy to comprehend and it reinforces for the industry the advantage of self- policing." Sheila Harvey Shaw, Pittman, Potts & Trowbridge GTE disclosed 511 violations of EPCRA (failure to notify state agencies and local fire departments of sulfuric acid filled batteries at 229 GTE telecommu- nications sites across the country) and 89 violations of the CWA (failure to de- velop required SPCC plans for diesel fuel stored at the facilities). SPCC plans are required to help prevent or mitigate spills and keep hazardous chemicals from pol- luting streams, rivers and other bodies of water. The settlement requires the company to pay a $52,264 penalty, equal to the amount of money saved by the company during its period of noncompliance. Of this amount, $16,708 is attributable to the CWA violations and $35,556 is for the EPCRA violations. In light of GTE's outstanding cooperation in voluntarily disclosing and promptly correcting, the Agency, pursuant to the Audit Policy, waived another $2.38 million in poten- tial penalties. SENATE HEARS TESTIMONY ON EPA's AUDIT POLICY Steve Herman, EPA's Assistant Administrator for Enforcement and Com- pliance Assurance, testified before the Senate's Committee on Environ- ment and Public Works along with industry, state, and public interest group representatives Oct. 30. The testimony focused on EPA's progress in implementing its Audit Policy and whether federal legislation establishing audit privileges and/or immunities is desirable or necessary. In his testimony, Mr. Herman reiterated EPA's longstanding opposition to such secrecy and amnesty legislation, and noted that EPA's Audit Policy is working extremely well in encouraging audits, disclosures, and cor- rection of violations. Herman mentioned the GTE settlement involving correction of 600 violations at 314 facilities, and the disclosures involv- ing other companies, as evidence of this success. See SENATE on page 2 Contents... From the Assistant Administrator Steel 'Mini-Mills' Encouraged to Conduct Self-Audits Voluntary Disclosure Board Established for Disclosures Involving Potential Criminal Violations Companies Granted Audit Policy Relief 4 Small Business Policy Promotes Assistance, Auditing 6 Information Corner 7 http://es.epa.gov/oeca/apolguid.html ------- AUDIT POLICY UPDATE FROM THE ASSISTANT ADMINISTRATOR EPA has opened the door for responsible companies working to stay in compliance with our environmental laws. Our Audit Policy slashes, and in some cases eliminates, penalties for those who voluntarily discover, promptly dis- close and expeditiously correct violations, offering power- ful incentives for the regulated community to comply. In addition to success under the Audit Policy, we have had good results in targeting specific requirements and offering one-time opportunities to report and correct violations in exchange for greatly reduced penalties. As of March 1,247 companies have disclosed environ- mental violations under EPA's Audit Policy at more than 760 facilities nationally, and EPA has reduced or waived penalties under the policy for 89 companies at 433 facili- ties. Under our penalty cap initiatives, 89 companies took advantage of EPA's one-time offer and submitted 11,000 previously unsubmitted chemical risk studies to the Agency for review—more studies in this one TSCA 8(e) initiative than the total number of studies submitted to EPA since 1978. Also in this issue, we report that 170 companies in the food manufacturing and processing industry submitted important information to the Agency and state and local emergency response personnel concerning hazardous chemicals stored onsite. As a result of this time-limited offer by EPA, we have obtained information that local communities need to effectively develop and implement emergency response plans for hazardous spills or releases, and enhance community awareness of the chemical haz- ards within the local area. Our results show that companies do not need secrecy or blanket immunity to meet their obligation to comply with our environmental laws. They do, however, respond well to fair and predictable incentives for voluntary compli- ance. Through our Audit Policy and penalty cap pro- grams, we will continue to keep the door open for compa- nies that want to walk through it. Steven A. Herman Assistant Administrator for Enforcement & Compliance Assurance EPA OFFERS SELF-AUDIT INCENTIVES TO STEEL 'MINI-MILLS' Early in fiscal year 1997, EPA's Region 5 office in Chicago encouraged approximately two dozen small steel mills ("mini-mills") in the Midwest to conduct self-audits and disclose potential environmental vio- lations. Instead of conducting immediate inspections in this industry sector, EPA educated the regulated community on the applicable legal requirements and offered the mills an opportunity to take advantage of the Audit Policy before inspections planned for later in the fiscal year. Approximately half of the mini- mills conducted self-audits and several disclosed vio- lations. EPA now has inspected most of the facilities that did not conduct a self-audit. For further information, contact Denny Dart at (312) 886-1426 SENATE FROM PAGE 1 Even among the industry witnesses who testified in favor of federal privilege and immunity legislation, the Committee heard praise for EPA's Audit Policy. Paul Wallach, a lawyer repre- senting the National Association of Manufacturers (NAM) and the Corporate Environmental Enforcement Counsel (CEEC), remarked that EPA should be commended "for issuing its Audit Policy and for improving and clarifying the availability of pen- alty mitigation for responsible entities." At the hearing, Wallach also told the Committee that EPA was doing a good job imple- menting its policy. When asked by the Senate Committee if there were any examples of EPA unfairly or poorly implement- ing its Audit Policy, Mr. Wallach and the other panelists identi- fied none. According to Mr. Wallach, NAM's more than 14,000 mem- ber companies and subsidiaries, which include approximately 10,000 small manufacturers, are located in every state, indus- trial sector and produce approximately 85 percent of the goods manufactured in the United States. CEEC is an organization of 22 diverse major companies, including numerous well-known Fortune 100 companies. Full copies of the written testimony submitted by Steve Herman, Paul Wallach and the other witnesses are available on the Internet at: http: //www. senate, go v/~ep w/stmts. htm February 1998 ------- AUDIT POLICY UPDATE Voluntary Disclosure Board Involving Potential On Oct. 1, 1997, the Office of Criminal Enforcement, Forensics, and Training (OCEFT) issued a guidance entitled: "Implementation of the EPA's Self-Policing Policy for Disclo- sures Involving Potential Criminal Violations." This guidance establishes a Voluntary Disclosure Board (VDB) at OCEFT Headquarters in Washington, D.C., to en- sure that all disclosures submitted to the Agency under the Self-Policing Policy involving potential criminal violations are considered and administered in a consistent and fair manner nationally, whether the initial disclosure is made to EPA re- gional offices, Headquarters or one of OCEFT's 40 field of- fices of the Criminal Investigation Division (CID). The VDB or Board is comprised of OCEFT senior offi- cials, as well as a member from the Environmental Crimes Section of the Department of Justice. The VDB dockets, monitors, and reviews all requests for treatment under the policy. Following review of the disclosure and the results of the criminal investigation, the Board will determine whether the relevant conditions of the policy have been satisfied and Established for Disclosures Criminal Violations make a recommendation to the OCEFT director, who serves as the deciding official. The Director will decide if the agency should recommend whether the disclosing entity not be pros- ecuted. The final decision to accept the recommendation in criminal cases exclusively resides with the prosecuting au- thority in its independent exercise of prosecutorial discretion. The guidance further clarifies the conditions that are ex- pected to be met by a disclosing entity in the criminal en- forcement context, including the terms of cooperation with any government investigation and steps to assure correction, remediation and prevention of recurrence. The Board's over- sight will ensure that a criminal investigation initiated as a result of a disclosure has sufficient facts to support or oppose a recommendation that relief under the policy be granted. For further information contact Michael Fenders, OCEFT, (202) 564-2480. Food Products Industry Gets Reduced Penalties For Disclosing Chemical Inventory Violations Federal, state and local agencies are now better prepared to handle emer- gencies, thanks to information about hazardous chemical inventories that nearly 200 food companies provided in response to a special EPA initiative. Through this initiative, the compa- nies submitted previously required in- formation about stored hazardous chemicals in response to a time-lim- ited offer by EPA to reduce penalties for violations of the reporting require- ments in the Emergency Planning and Community Right to Know Act (EPCRA). As of Feb. 1, 170 com- panies have submitted hazardous chemical data and paid individual fines of $2,000 (totaling $340,000), which is significantly less than they would have paid. February 1998 The EPCRA hazardous chemical in- ventory report is due annually on March 1 to state emergency response commissions, local emergency plan- ning committees and local fire departments. Data on hazardous chemical inventories provided by fa- cilities are crucial for local communi- ties to develop and implement emer- gency response plans effectively for hazardous spills or releases and to en- hance community awareness of the chemical hazards within the local area. The food products sector was cho- sen because of the large number of facilities that store regulated quantities of hazardous chemicals, including ammonia, chlorine, and sulfuric and ni- tric acids. EPA first conducted com- pliance assistance, followed by this initiative for failure to submit hazard- ous chemical inventory information. This initiative is now concluded and the sector enforcement agreement is no longer available. EPA has estab- lished the EPCRA Hotline (1-800-424-9346) to provide free technical assistance to facilities. For further information, contact Dean Ziegel at (202) 564-4038 or Beth Burchard at (202) 564-4117. ------- AUDIT POLICY UPDATE COMPANIES GRANTED AUDIT POLICY RELIEF Acadia Polymers, Irongate, VA Ademco, El Paso, TX Alliant Techsystems, Inc., Toone, TN ALCOA FujikuraLtd., El Paso, TX Alyeska Pipeline, Prudhoe Bay, AK (2 facilities) Armstrong World Industries, Hilliard, OH ATK North America, Arlington, TX ARCO - Kuparuk Oil Field, Prudhoe Bay, AK ARCO - Prudhoe Bay Oil Field, Prudhoe Bay, AK Austin Sculpture, Pharr, TX Auto Trim, Inc., Brownsville, TX Baldwin Piano & Organ, Trumann, Bortec Industrial Inc., El Paso, TX BP Exploration - Duck Island Endicott, Endicott Island, AK BP Exploration - Milne Point Unit, Milne Point, AK BP Exploration - Sourdough Exploration, Sourdough, AK BP Exploration - Western Oper. Unit, Prudhoe Bay, AK BP Exploration & Oil, Inc., Houston, TX BP Exploration & Oil, Inc., Port Angeles, WA Burlington Northern Santa Fe, 4028 Deen Rd., Fort Worth, TX Burlington Northern Santa Fe, 4200 Deen Rd., Fort Worth, TX Burlington Northern Santa Fe, Silsbee, TX Burlington Northern Santa Fe, Brownwood, TX Burlington Northern Santa Fe, Temple, TX Burlington Northern Santa Fe, Somerville, TX Burlington Northern Santa Fe, Amarillo, TX California Cooperative Creamery, Petaluma, CA Carolina Power & Light, New Hill, NC CENEX, Laurel, MT CENEX, Denver, CO CENEX, Inver Grove Heights, MN CENEX, Rhame,ND Chevron Chemical Company, San Ramon, CA Citiplate, Inc., Jackson, TN Clearwater Co., Pittsburgh, PA Coilcraft, Inc., El Paso, TX Cook Composites & Polymers, N. Kansas City, MO Cook Inlet Pipe Line Co., Drift River, AK DeKalb Genetics Corp, DeKalb, IL. Emerson Electric Co., Paragould, AR EPSON Portland, Inc., Hillsboro, OR Fiber Resin Corp. (H.B. Fuller), Chatsworth, CA Foster Products Corp. (H.B. Fuller), Houston, TX Frederick Manufacturing Corp., Kansas City, MO General Electric Corp., Waterford, NY Gobar Systems, Inc., Brownsville, TX Goulston Technologies, Inc., Monroe, NC GTE Corporation, Stamford, CT (314 facilities in 21 States) Hasbro, Inc., El Paso, TX H.B. Fuller Company, Warren, MI H.B. Fuller Company, Wilmington, MA H.B. Fuller Automotive Products, Dayton, OH H.B. Fuller R&D Pilot Facility, Vadnais Heights, MN Invacare, Inc., McAllen, TX ITT Automotive, Laredo, TX Kaneka Texas Corp., Pasadena, TX Kennecott Greens Creek Mining Co., Admiralty Island, AK Kingsford Products, Inc., Louisville, KY Audit Settlements by Statute Percentages reflect the number of facilities settling under the policy. February 1998 ------- AUDIT POLICY UPDATE COMPANIES GRANTED AUDIT POLICY RELIEF Kinross Mining Company, Silver City, ID Koch Refining Co., Corpus Christi, TX Lambda Electronics, Inc., McAllen, TX Lane Supply, Inc., Arlington, TX Magnetek, Inc., Brownsville, TX Metromedia Technologies, Inc., Los Angeles, CA Microfoam Corp., Utica, NY Midwestern Machinery, Minneapolis, MN Mikron Industries, Inc., Kent, WA Milliken & Company, Spartanburg, SC Minolta Co., Ramsey, NJ Mozel, Inc., St. Louis, MO NCI Building Systems, Chester, SC Norton Company, Stephenville, TX Occidental Chemical Co., Pasadena, TX Olin Corporation, East Alton, IL O'Neill Industries, Philadelphia, PA Outboard Marine Corp., El Paso, TX Owens Corning, Amarillo, TX Ozark-Mahoning Co., Tulsa, OK Paramount Packaging Co., Longview, TX Pete's Refrigeration, Bluefield, WV Pfizer, Inc., Lincoln, NE Randall Manufacturing, Inc., Weidman, MI Raychem Corp., Fuquay-Verina, NC Reliable Pharmaceutical Corp., Overland, MO Sampson Coatings, Richmond, VA Shure Brothers, Inc., El Paso, TX Siemens Electromechanical Co., El Paso, TX Signet Graphics, St. Louis, MO Simplot Dairy Products, Nampa, ID Facilities Disclosing Violations 350 Solomon Corporation, Solomon, KS Stepan Company, Millsdale, IL Sunbeam-Oster Co., Bay Springs, MS Sunbeam-Oster Co., Coushatta, LA Sunbeam-Oster Co., Hattiesburg, MS Sunbeam-Oster Co., McMinnville, TN Sunbeam-Oster Co., Neosho, MO (2 facilities) Sunbeam-Oster Co., Shubata, MS Sunbeam-Oster Co., Waynesboro, MS Teccor Electronics, Inc., Brownsville, TX Thomson Saginaw Ball Screw, Saginaw, MI Transportation Electronics, El Paso, TX TRW Vehicle Safety Systems, McAllen, TX TRW Automotive Products Remfg., McAllen, TX Union Carbide Corp., Garland, TX Union Carbide Corp., Hahnville, LA Union Carbide Corp., Seadrfit Plant, TX Union Carbide Corp., Texas City, TX (Main Plant) - #1 Union Carbide Corp., Texas City, TX (Main Plant) - #2 Union Carbide Corp., Texas City, TX (Marine Terminal) Union Pacific Resources, Carthage, TX University of Iowa, Iowa City, IA Unocal Corp., Cook Inlet, AK Vastar Resources, Inc., La Plata County, CO Victoreen, Brownsville, TX V-S Precision, El Paso, TX Web Inks Ltd., Kennesaw, GA Wells Manufacturing Co., McAllen, TX Witco Corporation, Olathe, KS Zeneca, Inc., Wilmington, DE Audit Policy Update Documents concerning the development of the Audit Policy, settlements under the policy, and additional copies of this Update, can be obtained by contacting the Audit Policy Docket located in Room 4033 of the Ariel Rios Building (1200 Pennsylvania Avenue, N.W., Washington, D.C.), by calling(202) 564-2119 or (202) 564-2614, or by Faxing requests to (202) 501-1011. Energy Communications Chemical Household Goods Misc. February 1998 ------- AUDIT POLICY UPDATE EPA's Small Business Policy Promotes Compliance Assistance and Auditing EPA's Small Business Policy pro- motes environmental compliance by providing incentives, such as penalty waivers and penalty mitigation, to those small businesses that participate in onsite compliance assistance programs or conduct environmental audits to dis- cover, disclose and correct violations. A small business may be eligible un- der the Agency's "Policy on Compli- ance Incentives For Small Businesses" to have all potential penalties for non- compliance waived if the companies agree to come into compliance and meet other criteria. The Small Business Policy: • allows small businesses to get anonymous government-sponsored compliance assistance and still get penalty reductions or waivers if they disclose and correct their viola- tions; and • provides an extended compliance period for small businesses that employ pollution prevention methods to correct their violations. Onsite compliance assistance in- cludes information or assistance pro- vided by EPA, a state or another gov- ernment agency or government-sup- ported organization during a visit to the facility to help the business comply with environmental requirements. States and EPA Regions may conduct compliance assistance visits or, through their compliance assistance programs, can identify other governmental orga- nizations that provide onsite compli- ance assistance. To Whom Does the Policy Apply? The policy applies to a person, cor- poration, partnership, or other organi- zation that employs 100 or fewer indi- viduals. EPA will eliminate its penalty against the small business if: • the business receives onsite compliance assistance or conducts an environmental audit; • the business identifies the violation(s) through the assistance or audit, and discloses it within 10 days (or such shorter period provided by law) to the appropriate government agencies; • it is the first violation of the requirement in a three-year period and no environmental enforcement actions against the business have been taken in the last five years; • the violation is corrected within 180 days after detection of the violation (or 360 days if pollution prevention is employed); and • the violation has not caused actual serious harm, and does not pose a potentially imminent and substantial endangerment to the public or environment, does not involve criminal conduct, and did not result in a significant economic benefit (which EPA anticipates will occur infrequently). EPA is marketing this easy-to-under- stand policy in a number of small busi- ness industry sectors, including dry cleaners and owners or operators of solvent cleaning machines that use par- ticular halogenated solvents (degreasers). Other small businesses to which this policy may apply include, but are not limited to, industrial organic chemical manufacturers, the chemical preparations industry, construction, automotive service and repair shops, landowners/farmers, privately-owned drinking water systems, electroplaters, small quantity generators and fuel blenders. For further information on the policy contact Karin Leff at (202) 564-7068. 11,000 Risk Studies Submitted to EPA Under Compliance Audit Program (CAP) Eighty nine companies voluntarily reported possible violations to EPA in return for reduced civil penalties under the TSCA 8(e) CAP initiative. TSCA 8(e) requires chemical manufacturers to inform EPA of any information about mixtures or substances that may present "a substantial risk of injury to health or the environment." One hun- dred and twenty-three companies undertook internal environmen- tal audits under the initiative; 34 reported no 8(e) violations. The remaining 89 participating companies submitted 11,000 stud- ies to the Agency for review. These previously unsubmitted studies more than total the number of studies submitted to the EPA since 1978. The information provided in these studies is important because it provides EPA the information it needs to limit or prohibit the use of chemicals that pose an unreasonable risk to health or the environment. EPA continues to evalu- ate the studies and is reviewing companies with similar pro- cesses to determine if they should be submitting 8(e) stud- ies. For further information, contact Mark Garvey at (202) 564-4168. February 1998 ------- AUDIT POLICY UPDATE INFORMATION CORNER (clip and save) WHOM TO CALL FOR AUDIT POLICY RELIEF Regulated entities that wish to take advantage of the Policy should fax or send a written disclosure to the appropriate EPA contacts listed below. Note that the written disclosure must be made within 10 days of the violation's discovery: EPA Office States Contact Phone # FAX # Region 1 (CT,ME,MA,NH,PJ,VT) Region 2 (NJ,NY,PR,VI) Region 3 (DE,DC,MD,PA,VA,WV) Region 4 (AL,FL,GA,KY,MS,NC,SC,TN) Region 5 (IL,IN,MI,MN,OH,WI) Region 6 (AR,LA,NM,OK,TX) Region 7 (IA,KS,MO,NE) Region 8 (CO,MT,ND,SD,UT,WY) Region 9 (AZ,CA,HI,NV) Region 10 (AK,ID,OR,WA) HQ-Criminal Enf. All potential criminal violations HQ-Multimedia Enf. Civil violations of >1 EPA Statute in >1 EPA Region HQ-Quick Response Team Civil violations in >1 EPA Region but under only one EPA statute Suzanne Parent John Wilk Samantha Fairchild Bill Anderson TinkaHyde Barbara Greenfield Becky Dolph Michael Risner Leslie Guinan Jackson Fox Roy Kime Melissa Marshall Gary Jonesi (617) 565-3351 (212) 637-3918 (215) 566-2999 (404) 562-9655 (312) 886-9296 (214) 665-2210 (913) 551-7281 (303) 312-6890 (415) 744-1339 (303) 312-1073 (202) 564-2539 (202) 564-6002 (202) 564-4002 (617) 565-1141 (212) 637-4035 (215) 566-2905 (404) 562-9663 (312) 353-1120 (214) 665-7446 (913) 551-7925 (303) 312-6953 (415) 744-1041 (303) 312-0163 (202) 501-0599 (202) 564-9001 (202) 564-0011 EPA HOMEPAGE http://www.epa.gov OECA HOMEPAGE http://es.epa.gov/oeca OECA POLICY & GUIDANCE http://es.epa.gov/oeca/polguidO.html AUDIT POLICY INTERPRETIVE GUIDANCE http://es.epa.gov/oeca/auditpol.html AUDIT POLICY http://es.epa.gov/oeca/apolguid.html SMALL BUSINESS POLICY http://es.epa.gov/oeca/smbusi.html WEBSITE INFO AUDIT GUIDANCE FOR CRIMINAL VIOLATIONS http ://es .epa.gov./oceft Audit Policy QRT The Audit Policy "Quick Response Team" was developed to ensure that determinations for eligibility under the Audit Policy are quick, fair and consistent nationally. The QRT assists EPA regional offices, the Department of Justice and the public by interpreting the policy's applicability, particularly in cases of first impression. The QRT is made up of senior staff from EPA Headquarters, Regions and the Depart- ment of Justice. The Audit QRT Chair is Gary Jonesi (202-564-4002). February 1998 ------- We need your help! To ensure that this newsletter reaches the right members of your organization, please take time to fill out the information below and fax this page to Virginia Bueno, editor at (202) 501 -9001 or email the information to bueno.virginia@epamail.epa.gov. Duplicate this form if necessary. Do you want to continue to receive this publication? U Yes U No Who else besides you should receive this publication: Name: Name: Title: Title: Address, City, Address, City, State, Zip+4 digit: State, Zip+4 digit: Email: Email: FAX Number: FAX Number: How would you prefer to receive this publication? _ How would you prefer to receive this publication? email U interned Fax U mail U email U interned Fax mail This publication is also available on the Internet at: http://es.epa.gov/oeca/apolguid.html The Audit Policy Update is published periodically for the Assistant Adminstrator for Enforcement and Compliance Assurance by its Office of Regulatory Enforcement. The Update is intended to provide information to the public and regulated communities regarding developments under the EPA Audit Policy. Editor: Virginia Bueno, (202) 564-8684. Email: bueno.virginia@epamail.epa.gov. 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