nan
Practitioners
Enforcement!
Workshop
Office of Enforcement and
Compliance Assurance
Office of Regulatory
Enforcement/RCRA
Enforcement Division
September 1995
&EPA
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RCRA PRACTITIONERS ENFORCEMENT
WORKSHOP
LIST OF MODULES
1. OBTAINING AND DEVELOPING EVIDENCE/RCRA ACCESS
2. PITFALLS IN RCRA CASES
3. PREPARING THE EXPERT WITNESS
4. IDENTIFYING SOLID AND HAZARDOUS WASTES
5. NEW AND UPCOMING DEVELOPMENTS
6. STATE/FEDERAL LEGAL RESPONSIBILITIES IN RCRA ENFORCEMENT
7. RCRA PERMITS: RELATIONSHIP TO ENFORCEMENT
8. ENVIRONMENTAL JUSTICE
9. RCRA CIVIL AND CRIMINAL ENFORCEMENT: "TOOLS OF THE TRADE"
10. BANKRUPTCY FOR RCRA ATTORNEYS
11. SAMPLING AND ANALYSIS
12. COMPLIANCE ASSISTANCE
13. CIVIL PENALTIES UNDER RCRA
September 1995
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LIST OF ABBREVIATIONS AND ACRONYMS
AMC
- American Mining Congress
CAA
- Clean Air Act
CBI
- Confidential business information
CEM
- Continuous emissions monitor
CERCLA
- Comprehensive Environmental Response, Compensation, and Liability Act
CESQG
- Conditionally exempt small quantity generator
CLP
- Contract Lab Program
CMI
- Corrective measures implementation
CMS
- Corrective measures study
CSI
- Common Sense Initiative
CWA
- Clean Water Act
DEQ
- Department of Environmental Quality
DOJ
- U.S. Department of Justice
DQO
- Data quality objective
ECP
- Environmental Leadership Program
EEJC
- Environmental Equity and Justice Commission
EMA
- Environmental management assessment
EPA
- U.S. Environmental Protection Agency
ERP
- Enforcement Response Policy
FACA
- Federal Advisiory Committee Act
GAO
- U.S. Government Accounting Office
GIS
- Geographic information systems
HSWA
- Hazardous and Solid Waste Amendments
HWIR
- Hazardous Waste Identification Rule
IM
- Interim measures
IR
- Infrared
LDR
- Land disposal restriction
LOIS
- Loss of interim status
MACT
- Maximum achievable control technology
MOA
- Memorandum of agreement
MWC
- Municipal waste combustor
NOD
- Notice of deficiency
NOV
- Notice of violation
OC
- Office of Compliance
OECA
- Office of Enforcement and Compliance Assurance
ORC
- Office of Regional Counsel
OSW
- Office of Solid Waste
PCB
- Polychlorinated biphenyl
PRP
- Potentially responsible party
QA
- Quality assurance
QAMS
- Quality assurance management staff
QAPjP
- Quality assurance project plan
QC
- Quality control
RCPP
- RCRA Civil Penalty Policy
RCRA
- Resource Conservation and Recovery Act
RFI
- RCRA feasibility investigation
RI/FS
- Remedial investigation/feasibility study
September 1995
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RCRA Practitioners Enforcement Workshop
List of Abbreviations and Acronyms
SAP
- Sampling and analysis plan
SBAP
- Small Business Assistance Program
SEP
- Supplemental environmental project
SWMU
- Solid waste management unit
TC
- Toxicity characteristic
TCLP
- Toxicity characteristic leaching procedure
TOC
- Total organic carbon
TRI
- Toxics Release Inventory
TSD
- Treatment, storage, and disposal
TSDF
- Treatment, storage, and disposal facility
UTS
- Universal treatment standards
VO
- Volatile organic
September 1995
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
1. OBTAINING AND DEVELOPING EVIDENCE/
RCRA ACCESS
&EPA
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RCJRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Module 1 Objectives
• Discuss the role of obtaining evidence
through inspections
• Review information on access
• Become familiar with inspection methods and
documentation
• Discuss file reviews as a critical element in
obtaining evidence
• Maximize use of evidence and information by
minimizing legal defenses and factual
inconsistencies
Notes:
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September 1995
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Module Overview
• Strategy development for obtaining evidence
from an inspection
• RCRA § 3007 information request letters
• Access
• Site inspections and gathering evidence
• Followup and reporting
J
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
r
\
Developing a Strategy for Obtaining
Evidence in an Inspection
Purpose of the inspection
File review
Strategy development for the inspection
Strategy development for gathering
information
- RCRA § 3007 Information Request letter
y
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Purpose of Inspection
• Routine periodic compliance assessment
• Enforcement action foliowup
• Compliance deadlines foliowup
• Comprehensive review of records or data
• Sampling waste streams/environmental media
• Response to alleged violations at the facility
• Review of pre-permit environmental conditions
• Evaluation of facility monitoring/cleanup actions
• Identification mechanisms for cross-program and
media compliance
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
File Review
• RCRA Notification Form (3010)
• RCRA Part A Permit application
• RCRA Part B Permit application
• RCRA Part B Permit
• Contact information of responsible persons
• Process flow chart with waste streams
• List of wastes generated
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
File Review (Continued)
• Information sources (cont.):
- List of wastes treated, stored, disposed by type of
management unit (TSDs)
- Inspection reports, photographs
- Diagram of the facility layout showing waste
generation processes in management units
- Biennial or annual report, monitoring reports,
other reports and studies
- Citizen's complaints against the facility
- Telephone logs
- Enforcement actions
- Response to a § 3007 request
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Inspection Strategy:
A Deliberative Decisionmaking Process
• Facility pre-notification
• Units/processes/documentation focus
• Sampling
• Checklist use
• Order of inspection
• Inspection attendees and coordination
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
RCRA § 3007 Inspection Authority
RCRA § 3007(a)- "[f|or purposes ...
enforcing the provisions of this title," EPA is
authorized to:
1) Enter at reasonable times any establishment
where hazardous wastes are or have been
generated, stored, treated, disposed of, or
transported from
2) Inspect and obtain samples from any person of
any such wastes and samples of any containers or
labeling for such wastes
3) Request information relating to hazardous wastes
from the facilities and obtain copies of all records
relating to hazardous wastes.
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Facility Rights:
The Fourth Amendment
A
"The right of the people to be secure in their
persons, houses, papers, and effects, against
unreasonable searches and seizures shall not
be violated, and no Warrants shall issue, but
upon probable cause, supported by Oath or
affirmation, and particularly describing the
place to be searched and persons or things to
be seized."
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Commonly Requested Access Conditions
Indemnification—The U.S. cannot be
indemnified
Split Samples—RCRA entitles owners to split
samples
Reasonable Times—Use judgment
Providing Notice—Practical issues; use
judgment
Observation by Owner or Representative-
Only if will not delay inspection
Photographs—EPA inspector can take;
facility can request confidentiality
Notes:
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September 1995
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Inspector's Response to Denial of Access
• Request the reason for denial
• Do NOT discuss potential penalties or do
anything that could be construed as
threatening
• Complete a "Denial of Access Report" and, if
possible, obtain facility representative
signature
• Leave the premises and document any
observations
• Report denial to appropriate office
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Confidential Business Information
RCRA § 3007(b)- records, reports, or
information obtained by EPA are available to
the public, unless it can be shown that the
material contains confidential information.
Information must be appropriately marked
to claim confidentiality.
EPA determines whether the designation of
confidentiality is appropriate and notifies
facility of determination.
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
r
Conducting Inspections
• Preparation and entry
• Opening discussions and review of waste
handling procedures and records
• Visual inspection and documentation
• Closing discussion
Notes:
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September 1995
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
\
Opening Meeting Agenda
• Discuss RCRA authority to conduct
inspection
• Outline inspection objectives
• Provide Information on RCRA
• Establish the order of the inspection
• Schedule a closing conference
• Gather general and specific information
• Ascertain whether the owner/operator will
claim information as CBI
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Information Sources:
Records/People
• Records to be maintained by generators
- Manifests and exception reports
- Biennial reports
- Waste analyses and test results
- Land disposal notifications and certifications
- Training plan and training records, by employee
and job title
- Contingency plan and agreements with local
authorities
• Key people knowledgeable about
facility/operation
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Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Inspections
• Inspectors should conduct inspections in a
way that allows them to understand the waste
flow within the facility and to determine the
compliance status of each segment of the
facility's waste management system
• Includes:
- Points of generation and accumulation
- Waste onsite transfer
- Storage, treatment unit
Notes;
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Inspector Objectives
- Hazardous waste generated at each point
- Wastes that may not be considered hazardous by
the facility
- Storage, point of generation, and satellite
accumulation areas
- Quantities of waste (by type) at each area
- Mislabeled, mishandled, or waste exceeding 90-
day limit
- Noncomplying practices
- Situations that could cause a spill or result in a
violation
- Evidence of spills and areas to collect samples
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Documentation
• Original documentation becomes part of the
inspection file upon completion of the
inspection:
- Field notebook
- Checklist
- Map or drawings with notations
- Photographs
- Photocopy relevant documents
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Closing Meeting
• Maintain professional courteous demeanor
• Review findings
• Answer questions
• Request additional information, if necessary
• Establish mechanism for responding to
questions for which the inspector has no
answer
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Followup and Reporting
• Followup—A review of all information and
outstanding questions
- Review all field notes, photographs, checklist,
drawings, file information
- Interview other inspectors
- Return to facility
- Submit § 3007 information requests
• Reporting—A compilation of all relevant
information and evidence gathered during an
inspection into a comprehensive and usable
manner
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Writing the Report
• How the information is conveyed is as
important as what is said.
• Be accurate—State the facts
• Be concise, yet complete—Tell all but do not
be redundant
• Be clear
- Use active voice
- Use simple, unstilted language
- Reference photographs, drawings, and documents
- Cite the regulations and explain how/why the
facility is not in compliance
Notes:
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence
Steps to Writing the Report
Notes:
• Organize and outline
• Reference the sources—Primary sources
should be used first
• Write the report ky, -
Case development staff review / A.
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Wilson Jones* Quick Reference Index System
© 1991 Wilson Jones Company
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
1. OBTAINING AND DEVELOPING EVIDENCE/
RCRA ACCESS
Background Materials
&EPA
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RCRA Practitioners Enforcement Workshop
Obtaining and Developing Evidence/RCRA Access
1. OBTAINING AND DEVELOPING EVIDENCE/RCRA ACCESS
1.1 OBTAINING AND DEVELOPING EVIDENCE AND ACCESS
Evidence and information developed by the inspection team constitutes the core material
that the Resource Conservation and Recovery Act (RCRA) case development staff will build into
an enforcement case. If the evidence supporting a violation is not properly obtained, or is
insufficient, the case will be difficult to develop and may lead to a dismissal. For several reasons
case development staff benefit by understanding how relevant information is gathered and what
constraints may hinder case development. Such understanding allows case development staff to
coordinate with the RCRA inspection team throughout the case development process, to aid in
the gathering of information (e.g., issuance of RCRA § 3007 information requests), to provide
appropriate input into the inspection process, and to review the products of the inspection process
for adequacy and completeness, as well as to gain an appreciation of the potential limitations that
may be placed on such products (e.g., suppression of improperly gathered information). In
addition, coordination between the RCRA inspection and case development teams decreases the
probability that legal and factual issues, such as chain-of-custody, authentication of documents,
and sampling techniques, do not pose an obstacle to settlement negotiations or litigation.
1.1.1 Overview of Discussion
Evidence is obtained primarily through inspections and RCRA § 3007 information requests.
This module is divided into four sections that deal with obtaining and developing evidence by
the Agency that maximizes its use and minimizes legal defenses and factual inconsistencies or
discrepancies. These sections include:
• Developing an Inspection and Information-Gathering Strategy
• Access
• Inspecting the Site
• Followup and Reporting
Each is discussed below.
1.1.2 Developing an Inspection Strategy
The more clearly defined the purpose of an inspection, the more likely it is to achieve its
objective and obtain the necessary evidence for subsequent enforcement. Thus, the development
of well thought-out inspection strategy promotes achievement of RCRA enforcement objectives.
Where an inspection is proactive (i.e., the U.S. Environmental Protection Agency [EPA] initiates
based on its own compliance monitoring objectives), the Agency has sufficient time to marshall
the information needed to conduct a thorough inspection. In other instances (i.e., where EPA is
responding to some event or new information) an inspection is reactive and preparation time is
constrained. Here, followup inspections may need to be conducted.
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1.1.3 Purpose of Inspection
The purpose and objectives of an inspection determine its scope. The scope of a routine
inspection will differ from an inspection performed to determine compliance with an enforcement
action, and from one to determine historical operating practices. Inspections typically have one
of the following purposes:
• Routine periodic assessment of RCRA compliance
• Review facility activities with respect to an enforcement action
• Review of compliance with deadlines established in a RCRA permit
• Comprehensive review of records or data
• Sampling of waste streams or environmental media
• Response to alleged violation at the facility
• Review of facility environmental conditions prior to permit issuance
• Evaluation of facility monitoring/cleanup activities, or
• Identification of mechanisms for cross-program/media compliance.
The more specifically the purpose of the inspection can be defined, the more focused the
inspection can be in terms of 1) the records and files reviewed in preparation, 2) the number and
types of units that need to be examined during the inspection, and 3) the type of documentation
and evidence that must be collected during the inspection or through follow-up RCRA § 3007
information request letters.
1.2 PREPARATION
1.2.1 File Review
Inspectors generally want to obtain as much information about a site as possible prior to
an inspection. Hence, an inspector should review the facility's file to obtain information and
develop a strategy for conducting the inspection. Depending on the complexity of the facility,
file review may commence in the initial phases of the planning and continue as the inspector
prepares for the inspection. Files may also be re-visited during the followup activities and report
writing. For a followup inspection where probable violations have already been identified, both
the inspector and the case development staff should become familiar with facility information.
This will enable a coordinated effort in gathering the type of evidence needed during the
inspection. Files should be reviewed to:
• Develop a technical understanding of the facility, its waste generating processes, wastes
managed, waste management units
• Develop an understanding of the compliance history of the facility, including outstanding
compliance issues, the facility's efforts to come into compliance, alleged violations, and
status of selected enforcement items and schedules
• Identify inconsistencies in the file that may require clarification during the inspection, and
• Ascertain applicable regulations.
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The inspector may have to assemble documents not only from RCRA facility files and
enforcement document files, but also from other programmatic files and interviews with other
inspectors. In general, the following list of documentation should be reviewed, although it'is not
comprehensive:
• RCRA Notification Form (3010)
• RCRA Part A Permit application (for TSDs)
• RCRA Part B Permit application, including supplement
• RCRA Part B Permit and modifications (for permitted TSDs only)
• A summary of the names, titles, locations, and telephone numbers of responsible persons
• A flow chart showing the process flows, and waste streams generated
• A list of wastes generated
• For TSDs, a list of wastes treated, stored, disposed by type of management unit
• Inspection reports, including photographs
• A facility diagram layout showing waste generation processes and management units
• Enforcement actions taken
• Biennial or annual report
• Monitoring reports
• Other reports submitted to EPA or the state agency (Comprehensive Environmental
Response, Compensation and Liability Act reports, e.g., National Capacity Assurances
Plans; Preliminary Assessment/Site Investigation)
• Previous special studies, consultant's reports
• Citizen's complaints against the facility
• Telephone logs
• Response to Section 3007 request.
Additional sources of information might include Occupational Safety and Health
Administration files, workman's compensation claims, corporate or partnership papers, Securities
and Exchange Commission filings, Dunn & Bradstreet reports, etc.
During the file review, the inspector should develop an initial basic understanding of the
facility and its waste generating/storage/treatment/disposal processes. Also during this period,
the inspector should review the applicable sections of the regulations and return to the file review
to gather a greater depth of understanding of the conditions that may be encountered at the site.
The depth of understanding of the facility and its compliance history gained by the inspector
during the file review will, to some extent, determine the effectiveness of the inspection and his/
her ability to gather evidence. By implementing a cooperative review where appropriate, the
inspector and the case development staff will ensure greater depth of review and understanding
of the facility resulting in greater effectiveness of the inspection.
1.2.2 Developing a Strategy to Implement the Inspection
The inspector should determine a strategy or plan for the inspection. This plan need not
be onerous, but decisions on approach should be made in a deliberative process considering the
desired outcome. The decisions that should be considered during this process include:
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• When the inspection is to be performed
• Whether or not it is appropriate to notify the facility in advance of the inspection
• Which units/processes and/or documentation should be the focus of the inspection
• Whether or not sampling will be performed
• Whether the records review should precede or follow the walk-through
• Whether a standard or individually created checklist will be used, and
• In which order the units will be inspected.
Working through the process-flow to waste generation and subsequent waste management
may provide a greater understanding for initial inspections. Another approach is to work
backwards from waste transport off-site through generation. A third approach could be to
establish a plan based on the facility layout.
Routine and followup inspections to determine compliance with applicable regulations are
generally most successful when unannounced. This ensures that what is observed will be a true
representation of ongoing practices, rather than a "cleaned up" version of the facility operations
(afforded to the facility when advance notice of inspection is given). Other inspections/site visits
such as evaluations of monitoring programs or a RCRA, Facility Assessment will prove most
successful when scheduled in advance with the facility. This gives the facility time to gather the
needed/requested information prior to the inspector arriving on site and to allow the appropriate
facility representatives to be present.
Another consideration is who should attend
the inspection. Generally, two inspectors should
plan to attend for safety reasons. Additionally,
two observers can observe more comprehensively
than one. Sometimes inspectors from other
programs may want to coordinate an inspection with the RCRA inspector. If another program
is involved, time for coordination should be allowed.
1.2.3 Developing a Strategy to Gather Information: RCRA § 3007 Information
Request Letter
Section 3007 of RCRA requires that persons who generate, store, treat, transport, dispose,
or otherwise handle hazardous waste must, upon request of an EPA employee or authorized state
representative, furnish information relating to such wastes (RCRA § 3007(a)). Pursuant to this
authority, the Agency uses information request letters to collect information relevant to RCRA
compliance. (EPA also uses RCRA § 9005 to gather information about underground storage
tanks.) Such requests are a powerful tool that can help fill information gaps or possibly focus
an inspection.
This particular tool can be used at various points during case development. If, for example,
an information request was already present in the case file due to a prior action, the facility's
response may provide a wealth of information or may reveal questions that should be addressed
during the inspection. In addition, information request letters are used when doing follow-up to
an inspection.
Developing a strategy or plan for the
inspection may be an iterative process,
particularly if the facility is complex or the file
review uncovers unexpected information.
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Information request letters do not necessarily need to be sent to the person (e.g., generator,
owner or operator of a facility) who is the subject of EPA's investigation. Information request
letters can be directed to individuals who come within the scope of RCRA (e.g., generate
hazardous waste) and have dealings with the subject of the investigations (e.g., TSD). For
example, prior to an investigation, EPA could contact generators of hazardous waste that is being
sent to a facility for treatment. The generators' responses may provide additional insight into the
facility's operation and focus the inspection. It should be noted that in some instances EPA can
utilize RCRA § 3007 information request letters to obtain information from a third party even
after a compliant has been filed by the Agency.
1.3 ACCESS
This portion of the module provides information on:
• EPA's inspection authority under RCRA
• The rights of the facility
• Negotiating consent to gain access
• Confidential business information (CBI)
• Denial of access and warrants
1.3.1 RCRA Authority
Section 3007(a) of RCRA provides that "[fjor purposes of developing or assisting in the
development of any regulation or enforcing the provisions of this title," EPA is authorized to:
• Enter at reasonable times any establishment or other place where hazardous wastes are
or have been generated, stored, treated, disposed, or transported from;
• Inspect and obtain samples from any person of any such wastes and samples of any
containers or labeling for such wastes;
• Request information relating to hazardous wastes from the facilities and obtain copies of
all records relating to hazardous wastes.
This section grants EPA, authorized states, and EPA's contractors broad inspection
authority. For purposes of this discussion, the authority is limited to enforcement at facilities
where hazardous wastes are managed or have been managed. Note, however, that the term
"hazardous waste" as used in Section 3007(a) has been interpreted to include not only the listed
and characteristic wastes, but also any solid waste that EPA believes may pose a substantial
threat to human health or the environment. This includes the Appendix VIII hazardous
constituents listed in 40 CFR Part 261.
RCRA inspection authority includes the right to enter a facility at reasonable times, which
clearly include the operating hours of the facility. The authority extends to sample collection,
as well as photography, although there are limits to the: use of this authority.
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1.3.2 Facility Rights
In contrast to EPA's broad inspection authority under RCRA Section 3007, facility owners
have the fundamental right to be free from unreasonable searches. Specifically, the Fourth
Amendment provides:
The right of the people to be secure in their persons, houses, papers, and
effects, against unreasonable searches and seizures shall not be violated, and
no Warrants shall issue, but upon probable cause, supported by Oath or
affirmation, and particularly describing the place to be searched and persons
or things to be seized.
Warrantless searches are not unreasonable if the owner gives knowing consent. The
preferred method of gaining access is, therefore, consent. This consent must be provided for the
inspector to perform the inspection without a warrant. The consent must be voluntary and freely
given, and must be obtained without misrepresentation (e.g., claiming you have a warrant when
you don't). Contractors performing inspections for EPA shall only represent themselves as
contractors performing an inspection under direction of EPA, and shall never represent
themselves as an employee of the Agency. Consent may be withdrawn at any time during an
inspection. Once consent is withdrawn, the inspection team must leave the property and obtain
a warrant if EPA wishes to return to the facility and conduct the inspection.
Exceptions to the rule that warrantless searches are per se unreasonable include 1) knowing
consent, 2) exigent circumstances (emergencies), 3) open fields (iie., observing what is in plain
view), and 4) pervasively regulated industries.
Certain actions that are not legally defensible may result in denial of access. These include
owner/operator's refusal to allow:
• An inspector to bring in necessary equipment (e.g., camera)
• Access to documents
• Entry due to a strike and/or a plant shutdown
• Entry due to an inspector's refusal to sign a waiver or other legal document restricting
the owner/operator's liabilities or obligations (signing an entry log that does not constitute
such a waiver is acceptable).
When access is denied under these circumstances, the inspection team should document the
denial in their field notes and consult legal counsel.
1.3.3 Negotiating Consent
If access is denied initially, the first step should be to try to negotiate a resolution to the
problem. This negotiation between the case attorney and the facility may be dispensed with in
a few minutes over the telephone. Although EPA's authority to access the property can be cited
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during this process, neither the attorney nor the inspector, if present, should threaten or give the
appearance of threatening the facility representatives because access has been denied.
The facility representative may request that the inspector meet certain conditions before
allowing EPA access to the facility. In short, EPA cannot agree to conditions that would not be
in a warrant or that are required under RCRA. Some recurring issues are provided below which
may assist Agency negotiations:
• Indemnification—The United States cannot agree to indemnify the property owner for
damages caused by EPA or its contractor. However, the attorney can remain silent on
the matter; or can say that claims from damage would be covered by the federal Tort
Claims Act; or that the owner, in allowing access, would not be in any worse legal
position than if a warrant is sought and granted.
• Split Samples—The owner is entitled to split samples under RCRA. The property owner
is expected to provide his/her own bottles and make necessary arrangements for analyses.
The owner should probably be informed that data generated without following the U.S.
EPA QA/QC procedures would not be comparable to the EPA data.
• Reasonable Times—The property owner may want to limit the days and times the
inspectors can be on-site. Because the inspectors usually have no intention of arriving
at night, it may be acceptable to state that the specific inspection will proceed during
daylight hours.
• Providing Notice—While the owner is not legally entitled to advance notice, there may
be some practical reasons for providing it. For example, if sampling is to be performed,
the facility may face some logistics in providing access to processes of points of
generation which EPA may want to sample. Likewise, notice could ensure that the
appropriate facility personnel are available. During these negotiations, EPA's right to
enter in an emergency without advance notice must be preserved.
• Observation by Owner or Representative—Sometimes an owner will request that his/
her environmental consultant be present during the inspection to observe. Although the
EPA attorney can agree to allow the consultant's presence, s/he cannot agree to delay the
inspection for the convenience of the consultant.
• Provide Copy of Sample Results—RCRA requires that EPA provide a copy of sample
analysis data to the facility owner, operator, or agent in charge in a prompt manner.
RCRA Sec. 3007(a). Normally, EPA provides the property owner with a copy of the
final inspection report once it is prepared and has undergone appropriate review. EPA
cannot agree to provide the report within a specified time period, or agree to release drafts
of the report or raw data that has not been subject to proper quality assurance/quality
control. Such information is exempt as pre-decisional under the Freedom of Information
Act (see 40 CFR 2.118(a)(5)).
• Photographs—It is EPA's practice to take photographs during an inspection to document
the inspection process and provide an accurate picture of the site conditions. Some
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facilities have policies allowing photographs to be taken only by company employees,
citing protection of trade secrets. EPA's position is that in order to claim confidentiality,
the owner must follow the procedures in RCRA 3007(b), 42 U.S.C. Section 6927(b), and
40 CFR Part 2, Subpart B. The inspector must be allowed to take the pictures with his/
her own camera and where s/he deems necessary or appropriate.
1.3.4 Confidential Business Information
Section 3007(b) of RCRA provides that any records, reports, or information obtained by the
EPA pursuant to RCRA Section 3007 are available to the public unless it can be shown that the
material contains CBI protected under federal law. When such a showing has been made, the
information must be treated as confidential, pursuant to EPA regulations. Under general CBI
restrictions (40 CFR Part 2, Subpart B), only authorized personnel are allowed access to CBI and
no copies can be made unless authorized in writing by the document control officer. RCRA
provides criminal penalties for the improper disclosure of confidential information.
In addition to the general RCRA CBI restrictions, 40 CFR 2.305 provides that CBI collected
pursuant to RCRA Sections 3001(b)(3)(B) or 3007 may be disclosed by EPA where it is relevant
to specified proceedings (e.g., rulemakings, adjudication, licensing, issuance of administrative
orders, and approval or disapproval of plans) provided such disclosure meets specified
requirements. These provisions generally require that EPA: provide notice to the affected
business that the Agency is considering disclosing confidential information, allow the business
an opportunity to comment, consider the comments submitted, and find that the information is
relevant to the particular proceeding and that disclosure is in the public interest. EPA must also
provide 5 days notice prior to actual disclosure of the information.
Hence, inspectors and case development staff should be familiar with both the general CBI
regulations and the regulations addressing disclosure of CBI where relevant to a RCRA
proceeding. CBI may be part of an inspection report and must be handled appropriately pursuant
to the generally CBI rules. Where it appears that disclosure of CBI may be necessary to conduct
an enforcement case, staff should work with the responsible regional organizational unit and
EPA's General Counsel to ensure that CBI restrictions are satisfied.
1.3.5 Denial of Access and Warrants
Where access to a site or facility is denied the inspector should respond as follows:
• Request the facility to state the reason for denial
• If the problem is beyond the inspector's authority, suggest that the facility official contact
his/her attorney to obtain legal advice
• Do NOT discuss potential penalties or do anything that could be construed as threatening
• If access is still denied, complete a "Denial of Access Report" and if possible obtain
facility representative signature
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• Leave the premises and document any observations made pertaining to the denial,
including suspicion of violations
• Report all aspects of denial of access to the appropriate enforcement office to determine
appropriate action and to get assistance in obtaining a warrant
• Contact an EPA attorney to assist the inspector in preparing the documentation necessary
to obtain a civil search warrant and in arranging for a meeting with the inspector and a
U.S. or State Attorney. (The attorney will bring a copy of the appropriate draft, warrant
and affidavits to the meeting.)
• The attorney will secure a warrant and forward it to the inspector and/or the U.S. marshall
or equivalent state law enforcement authority.
Under EPA's policies, an administrative warrant must be obtained if the owner or operator
denies access to a facility. Such a warrant is sought only when all other efforts to gain lawful
entrance have been exhausted by EPA.
After EPA decides to seek a warrant, EPA
policies require the regional office to notify EPA
headquarters and then contact the local U.S.
Attorney's office to assist in preparation of the
application for a warrant and necessary affidavits.
The application for a warrant must identify the
following:
• The statutes and regulations under which
EPA is seeking the warrant
• The name and location of the site or facility to be inspected, and
• If possible, the owner or operator.
The application must be accompanied by an affidavit which describes all of the facts in
support of the warrant. The affidavit must be prepared by a person with firsthand knowledge of
the facts, most likely the EPA inspector.
If a warrant must be used to gain access, the inspector must conduct the inspection in strict
accordance with the warrant, which may restrict the time, areas of inspection, or access to certain
records. Inspectors must comply with these restrictions. If sampling is to be conducted as
authorized by the warrant, all procedures must be carefully followed, including presentation of
receipts for all samples taken by EPA. The facility has a right to retain a portion of the sample
(a split sample). If records or property are authorized to be taken from the facility, the inspector
must provide receipts and maintain an inventory of all items removed.
Note that information gathered during denial of
access may be useful to the Agency in gaining
subsequent access (e.g., observation of probable
violations) or other strategies (e.g., targeting
areas or units). In addition, all contacts should
be considered potential witnesses, and inspectors
may be able to provide insight regarding the
potential value of such persons as witnesses.
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Inspectors must be cautioned to avoid any statements to the facility representatives that
could be construed as threatening or inflammatory. This condition must be strictly followed,
even if the facility representative threatens the inspector.
1.4 INSPECTING THE SITE
The authority to conduct inspections is provided in Section 3007(a) of RCRA. This
authority allows EPA or its contractors to enter a facility at reasonable times to enforce
provisions under Subtitle C. The authority and its relation to access issues have already been
discussed. This section provides information on:
• Preparation and entry
• Opening discussions and review of waste handling procedures and records
• Visual inspection and documentation
• Closing discussion.
1.4.1 Preparation and Entry
An inspector should be prepared with the appropriate equipment to conduct an inspection.
Numerous items may be needed to facilitate a proper inspection (e.g., proper identification,
business cards, notice of inspection, EPA-issued Letter of Credential [for EPA contractors],
checklists, file documentation, measuring devices, calculator, flashlight, maps, CFRs, locking
briefcase, safety and sampling equipment). Among those items that are essential for proper and
complete documentation are a camera, a weather-proof field notebook, and perhaps a tape
recorder or cam-corder.
While inspectors need to be prepared for a variety of conditions and situations that may
arise during an inspection, a mechanism of keeping the equipment organized is also essential if
the inspection is to be carried out efficiently. The lead inspector may want to delegate the
photography and its documentation to the secondary inspector, allowing him/herself greater focus
on recording the observations, measurements, and facility representative's responses. Logistical
arrangements between two or more inspectors should be made before arrival at the site.
Upon arrival, the inspectors should introduce themselves and request the appropriate facility
representative. The inspectors should present their official identification as well as their business
cards, and announce the purpose of inspection, citing RCRA authority.
Inspectors may be asked to sign a log book or passbook. In general, inspectors may sign
logs or passbooks; however, an inspector should never sign waivers or other legal documents that
would limit the facility's liability. Inspectors should not sign other legal documents limiting
EPA's rights or the owner's responsibilities while the facility visit is occurring. EPA's rights and
responsibilities have been discussed in greater detail in the section on RCRA access.
1.4.2 Opening Discussion and Review of Waste Management Practices and Records
When the inspectors have located the appropriate facility authorities, it may be appropriate
to discuss the inspection plan. However, an opening meeting may not be appropriate in all cases.
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For example, if a violation is suspected, the inspector may want to view a waste handling process
before the facility could change any of their routine procedures. This determination should be
made during development of the inspection strategy. If an opening meeting is conducted, the
inspector should establish control during the opening discussion by providing an overview of the
inspection objectives and a plan for viewing the facility.
During the opening meeting and all
subsequent interviews, the inspector should
document each person's full name, title, and
telephone number. By obtaining a business card
from each facility representative, this information
can be easily gathered. In talking with each
individual or in a group, the inspector should ask
open-ended questions to gather information on the
questions basic to an investigative reporter (i.e.,
who, what, when, where, why, and how). The
inspector should seek to get specific details and should pursue inconsistencies until they are
resolved.
Inspectors should take notes and record observations, including observations of body
language that may provide indications about how the interviewee feels about what s/he is saying.
Notes should be taken in a field notebook that is dedicated to the inspection. Notebooks should
contain factual information and observations; comments should be professional in nature.
Remember, field notebooks can be subject to subpoena.
After the opening meeting, inspectors may proceed with a record review or the site visit.
RCRA inspectors are responsible for reviewing all records required by RCRA. However, the
inspector should be mindful of the objectives of the inspection by reviewing those records that
are most pertinent to the objectives. Recordkeeping required under RCRA that must be
maintained by facilities is lengthy; a list is provided in the RCRA Inspector's Manual, 1993
revision.
Although no standard format for records review has been developed, inspectors should
check for: 1) the presence of the required records or plans, 2) document dates, to ensure
documents are kept current and maintained for the required period, and 3) any suspected
falsification of data. Appendix HI of the RCRA Inspector's Manual provides a regulatory
section-by-section approach in assessing compliance. If the inspection checklist does not contain
this information, the inspector should be familiar with it, or bring the appropriate sections to the
inspection.
1.4.3 Visual Inspection and Documentation
Inspectors should conduct inspections in a way that allows them to evaluate and understand
the waste flow within the facility and to determine the compliance status of each segment of the
facility's waste management system. Visual inspections generally proceed in accordance with
the inspection plan, but inspectors should be flexible enough to change the planned approach, if
needed to accommodate the conditions they find at the site. Some inspectors prefer to work from
Sources of information within a company
include: Environmental Coordinator, Emergency
Coordinator, Safety Director, treatment Plant
Operator, Employees, Ex-Employees. Ask for an
organization chart and note that shift work may
offer new sources.
Other sources include: neighbors, observers,
customers, police, utility people, consultants,
other regulatory inspectors, newspaper reporters.
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the point of generation to the point in which
waste is transported off-site. Others prefer to go
in the reverse order, or still others may want to
inspect areas that are in close proximity to one
another.
Regardless of the order of inspection,
inspectors should be able to identify:
• All hazardous waste generated at each
point
• Hazardous wastes that may not be
considered hazardous by the facility
• Storage areas, points of generation and
satellite accumulation areas
• Quantities of waste (by type) at each area
• Non-complying practices that are part of
the facility's operations
• Mislabeled, mishandled, or improperly
tracked wastes
• Unusual situations that differ from the facility's stated operating procedures
• Evidence of spills and areas to collect samples
Inspectors should always maintain control of the pace and direction of an inspection. They
should ask relevant questions and pursue inconsistencies until they are sure that they understand
the practice as it is being conducted. Inspectors should record answers to the questions and
observations in their field notebooks; and they should complete the inspection checklist.
However, checklists should not be used exclusively to guide the inspection. It is important for
the inspector to have a thorough understanding of the practices and not be limited by the format
of the checklist. Also, adhering rigidly to the use of a checklist during the physical inspection
may anger facility representatives and could eliminate any cooperative relationship that has
developed between the facility and EPA. A conversational approach (i.e., without checklist in
hand) may afford the acquisition of information broader in scope than that outlined in the
checklist. The inspector should attempt to answer all specific questions identified during the
strategy meeting(s), as discussed previously. The inspector may want to refer to the relevant
questions in Appendix ID of the RCRA Inspector's Manual.
The accuracy and adequacy of an inspector's written and photographic documentation can
determine the ability of the agency to take effective enforcement action following an inspection.
The value of good documentation cannot be overstated. It aids in the development of the case,
Information may be gathered from people
through conversations, interviews, and
interrogations:
• Conversations—Ask employees for
information while inspecting
processes/areas. Actively listen for
relevant leads.
• Interviews—May be formal (inquiring of
management about major issues,
programs, waste management,
documents); or outside the scope of the
inspection (at facility or away from
facility). Obtaining background
information is key. Be knowledgeable and
act professionally to create a good first
impression. Remain focused, be
observant of non-verbal cues, and preserve
exchange in original notes, timely report,
and/or tape recording.
• Interrogations—Most formal technique.
Requires proper preparation and deliberate
strategy. Less suited to inspections
because risks creating non-cooperative
atmosphere.
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may eliminate potential legal defenses that might otherwise be put forth, and generally adds to
the Agency's credibility during enforcement. Documentation should include the following
elements:
• Field notebook—Field notebooks should contain: dates and times of the inspection; the
name, title and position of those present; the location and address of the facility; the
weather conditions; and observations, and answers to questions the inspector has posed
to the facility representatives. Field notebooks should also contain measurements such
as distances and direction to waste units, sizes of buildings, results of field instrument
readings, locations within a building of drums or tanks, numbers of drums or tanks at
each location, estimated quantity of waste in a tank or in drums, aisle space between rows
or drums, the location and types of process equipment types. Observations of
environmental conditions such as soil staining should be documented in the field notebook
as well as photographed.
• Checklist—Checklists should be completed as much as possible during the records review
phase of the inspection and after the physical site inspection and prior to the closing
meeting. The checklist information should be based on direct evidence.
• Map or drawings with notations—A schematic diagram or map of the site may be
obtained prior to the inspection. The schematic diagram can be used to direct the
inspection, as well as a form of documentation. Documentation on schematics or
drawings can include: process flow and waste generation points; changes in location of
any of the units or processes; areas of staining; new buildings that have been erected, or
former buildings no longer on-site; new locations for storage facilities; and the locations
of photographs taken. In wetter climates or seasons, inspectors may want to laminate
schematic diagrams before the inspection.
• Photographs—Photographs can provide very convincing evidence. A photographic log
should be maintained indicating: the date, time the picture was taken, the direction the
photographer was facing, the unit that was observed and other relevant elements within
the picture. The facility representative should not be allowed to take the picture, or to
mandate that the company provide the camera. The company can request that
photographs be handled as confidential business information. Following the inspection,
the inspector who took the pictures and maintained the photolog should type up the
photographic log so it is legible.
• Photocopies of relevant facility documents—Photocopies of relevant facility documents
help to resolve past issues discovered in previous inspections, as well as document current
non-compliant conditions.
• Physical Evidence—Document before removal.
Original documentation (field logs, checklists, maps or drawings, and photographs with the
accompanying photolog) become part of the inspection file upon completion of the inspection.
Therefore, inspectors should write as legibly as possible and be clear in the documentation
provided.
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When the inspector is certain the inspection objectives have been accomplished and all
pertinent units/areas have been visually inspected, s/he can prepare for the closing meeting.
Inspectors should not waste the time of facility representatives, but neither should they leave the
site without an understanding of the processes, waste flow and waste management. The facility
representatives would rather spend the necessary time during the inspection than have requests
for scheduling additional visits. Some facilities are sufficiently complex that inspections may
require more than one day. Inspectors should ensure they have all the information or should
request additional written documentation be submitted before the inspection is deemed complete.
1.4.4 Closing Discussion
Usually, facility representatives will be anxious to discuss the findings of an inspection
before the inspectors leave. Inspectors should schedule a closing meeting during the opening
discussion and then followup. Before the closing discussion, the inspectors should review the
notes and checklists to determine any information gaps and any areas of uncertainty as to how
the regulations apply to the site. This process should be carried out in private.
In preparation for the closing discussion, the inspectors should consider how to best present
information about violations observed during the inspection. Inspectors should be prepared to
discuss general findings in the context of applicable requirements. It is important to let the
facility representatives know that all inspection findings are preliminary until reviewed by the
inspector's supervisor. The inspector may not want to discuss findings that are questionable or
tentative. The closing meeting is also the time to request additional documentation from the
facility or documentation that the facility was unable to locate during the inspection. Submittals
to the inspector's office after the inspection should be accompanied by a facility affidavit stating
the information provided is accurate and true. The timeframe for these submittals should not
delay the preparation of the inspection report.
The inspector should also anticipate any questions the facility representatives may have of
them, so as to provide answers when asked. If the inspector anticipates questions for which s/he
does not have an answer, s/he can seek an answer before the closing meeting. If an inspector
does not know the answer to a question that is or is not anticipated, s/he should tell the facility
representative that EPA will provide an answer at a subsequent time, and then follow up
accordingly. If the question is of a complex nature, the inspector should request that the facility
put its inquiry in writing and forward it to her/his attention. Then the inspector should follow
up.
In conducting the closing meeting, the inspector must maintain a professional, courteous
approach, even if the facility representatives are not particularly cordial. This approach may help
build a more positive working relationship in the long-term. The closing conference can provide
an opportunity for inspectors to offer assistance to the facility representatives, although inspectors
should take care to avoid providing "consultant" type of advice. Inspectors should also avoid
providing advice with implicit promises of compliance or recommending a particular consulting
firm. Inspectors can suggest resources and outreach materials that are available.
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1.5 FOLLOWUP AND REPORT WRITING
Proper inspection followup, including report preparation and documentation of inspection
observations and results, provides the foundation for case development. By ensuring that all
questions have been answered the inspection team can develop a report that provides clear and
concise information about conditions at the site and the violations that were observed. Again,
in this phase, the case development staff is encouraged to work with the inspector. The report
must identify the clear evidence which supports the enforcement action.
Once all of the information is acquired [~~7 ' ! ~ ! " ~~ " L
, » , , * |j Since the Inspection Report is often one of the first I
an organize , e inspector should prepare a documents the court will see, it must be clear, I
well-written narrative report that documents complete, and well-documented. A good report can I
all key facts about the site, remembering that be the basis for an accelerated decision. I
the inspection report may become the focal
point of an enforcement action. The narrative report should be accurate, relevant, comprehensive,
and concise. The narrative report must integrate all known information about the site that is
pertinent to the inspection and its objectives.
1.5.1 Followup Activities
Followup activities should begin with a review of the log book, checklist, and photographs,
but should not end there. Inspectors need to determine whether all the questions have been
answered or whether, as a result of something that was observed during the inspection, additional
questions or areas requiring clarification have arisen. If additional questions have arisen, the
inspector should review the files to determine whether s/he can make a certain determination.
If not, other options are available. The inspector may want to discuss the questions with a staff
member who performed a previous inspection or an inspector from another regulatory program
(e.g., NPDES).
There may be times when an inspector may want to obtain further information from the
facility after the inspection has been completed. The inspector may call or return to the facility
to ask for additional clarification. The inspector may want to consider this approach carefully,
because the company representative may become alarmed or adversarial.
Additional information may be requested following an inspection using a Section 3007
letter. Information requests and questions posed in this format should be extremely well-written
and request precise information. Likewise, the facility's response to a 3007 information request
may be received after an inspection, due to logistic and scheduling issues. This information
should be reviewed prior to writing the narrative inspection report.
1.5.2 Inspection Reports
Inspection reports should coordinate all relevant information and evidence gathered during
an inspection in a comprehensive and useable manner. To ensure that the report accurately
reflects conditions observed during an inspection, the report should be prepared as soon as
possible after the inspection, before the inspector's ability to visualize the site begins to fade.
To optimize its utility, the inspector should write in a simple manner, using active rather than
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passive voice. Inspectors should organize the material in a logical manner to provide clarity and
avoid repetition. Each paragraph should be brief, yet present a complete set of observations
about the topic. Where possible, the inspector should incorporate references to the photographs
taken during the inspection.
Inspectors should follow three basic steps in
writing the report. First, after reviewing the
information as discussed previously, the inspector
should organize the material and outline the report
in one of several ways, depending on the strategy
developed for the inspection at the outset. The information should be presented in a
comprehensive and easily understandable system. Using the checklist as an organizational tool
and cross-referencing it can be useful. For a complex site, the report could be geographically
organized, or organized according to the different processes that produce, treat, or store waste.
Second, the inspector should clearly reference all supporting documentation that
accompanies an inspection report. Where possible, the inspector should use primary sources as
references. If a large number of references are used, a numbered reference system can be useful.
By assigning each document a number and developing a numbered list of references that will be
attached to the report, the inspector can maintain organization of the documents. If CBI is used
in the report, it should be included in a nonconfidential manner, or the entire inspection report
should be treated as CBI. Where CBI is used, the references should include the CBI document
numbers.
Third, the inspector should write the narrative report as a factual presentation of the
procedures used and observations made during the inspection. The inspection report should
contain general tabular information including:
• Name, address, and telephone number of the facility
• Name and title of the site representative
• Names, titles, and agencies or company of the inspection participants
• Date of inspection
• Purpose of the inspection
• A brief description of the facility
• A list of violations observed.
The report should include a description of
what documentation was reviewed and how each
of the requirements is or is not being met. For
observations made during the walk through,
observations of how each of the requirements was
not met in each area should be recorded. Observed violations should be discussed in detail with
supporting documents and photographs referenced. Where applicable, measurements should be
provided, for example, the numbers of drums, the total volume of waste, the distance from
buildings to storage areas, the flows of waste streams. Where conditions have changed at a site
since a previous inspection, the inspector should provide a description relating the historical
condition to the present condition. This will provide more continuity to the next inspector. For
An inspection report is complete when it answers
the questions who, what, when, why, where and
how for the pertinent units, processes and wastes
at a facility.
Strive to eliminate any possibility of erroneous
conclusions, inferences, or interpretations, as
well as ambiguity. These detract from the
credibility of the report.
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example, if a drum storage area was reported previously to be located along the south wall of
a specific building, but was observed at a new location during the recent inspection, the author
should provide not only the previous and new locations, but any pertinent information as to why
the storage area was moved, if available.
When the draft report is finished, the inspector should proof-read it to ensure that it is as
complete and concise as possible. The draft narrative report should be assembled into a complete
inspection report with the other components. These components include: a complete and legible
checklist, the photographs and a typed photograph log describing each picture, the field notebook,
the reference list, and any other primary documentation.
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EXERCISE
In response to recent complaints of an unusual odor emanating from Deep Creek, an RCRA
inspection is undertaken at the chemical facility located on the creek immediately upstream from
where the citizens have noticed the sickening smell. The facility holds a Part B permit for
hazardous waste storage. Before attempting to enter the facility the inspector takes several photos
of three aboveground hazardous waste storage tanks she has identified from a review of the Part
B permit. Leaving her briefcase and log in the car, the inspector takes the photos from the
shoulder of the highway, puts away her camera, and hurries to the facility. The unannounced
inspection surprises the facility's manager. He insists that the inspector sign an entry log that
and asks that she sign a non-disclosure statement if she wants to examine particular parts of the
plant. She signs the log, but refuses to sign the statement. After negotiating, the manager
provides verbal consent and allows the inspection to proceed in all areas except the
manufacturing area. A plant engineer joins the inspector and manager. Without initiating any
discussion with the engineer, the inspector proceeds immediately through the plant toward the
three storage tanks, which she suspects may be leaking onto the ground and into the river. As
she approaches within view of the tanks, the manager points out they are off limits, since they
are in the manufacturing area. Upon hearing that, the inspector pulls out her camera (which has
a zoom lens) and prepares to start taking photos of what appear to be leaks in the tanks. Upon
seeing the camera, the plant manager announces that photos are not allowed, and that the
inspector must leave immediately. All three proceed back into the plant and toward the exit
when the inspector notices dark fluid and stained soil on the ground under a pipeline. As she is
walking toward the exit she snaps a photo of the leak. The inspector notices other stains and
turns right to move closer. She snaps another picture. Upon exiting, the manager directs that
the plant engineer escort the inspector to her car and watch her leave. No words are passed.
1. Are any of the photos valuable as evidence of the tanks or pipes causing a release of
hazardous waste? Why or why not?
2. Is any of the information collected after verbal consent was withdrawn useful in an
enforcement action? Which? Why?
3. What additional steps would have helped make the evidence collected more useful in an
enforcement action?
4. What can be done to supplement the information collected and build a defensible case?
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2. PITFALLS IN RCRA CASES
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RCRA Practitioners Enforcement Workshop Technical Pitfalls in RCRA Cases
Module 2 Objectives
• Become familiar with technical and legal
pitfalls in RCRA enforcement case
development
• Recognize bias introduced by consultants
• Recognize scientific biases that can occur in
the three stages of technical information
gathering and evaluation (i.e., sampling,
analysis, and modeling)
• Recognize potential legal pitfalls associated
with chain-of-custody and authentication of
documentation
V
J
Notes:
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Technical Pitfalls
• Technical information used in RCRA cases
can be biased in two ways:
- Bias introduced by the use of consultants
- Scientific bias
Notes:
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Technical Pitfalls in RCRA Cases
Types of Consultants
• Non-affiliated consultants
• Consultants acting as "hired guns,"
knowingly or unknowingly
• Multi-consultant teams
• Low bid consultants
• Unsupervised consultants
• Miscellaneous consultants
Notes:
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Non-Affiliated Consultant
• Consultant unencumbered by any
restrictions imposed by client
Notes:
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Consultant Acting as "Hired Gun"—Knowingly
Client directs consultant and consultant
willingly agrees to the direction
Notes:
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Consultant Acting as "Hired Gun"—
Unknowingly
Consultant unknowingly directed by client
Notes:
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Multi-Consultant Teams
• Several consultants working on a specific
subtask of a large project
• Each consultant, with similar capabilities,
vying for a larger piece Of the project
• Consultants who satisfy client given larger
roles or more tasks; those who do hot given
smaller roles
Notes:
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Low bid or Low Cost Model Consultant
Client solicits fixed price bids from dozens of
consultants
Consultant with lowest priced bid awarded
contract
Winning consultant only able to provide the
minimum or substandard work product
Notes:
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Unsupervised Consultant
• Unsophisticated client with deep financial
pockets requires environmental investigation
• Client places total faith in consultant
• Consultant sees opportunity to make money
by performing superfluous work
Notes:
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Miscellaneous Consultants
• Relationship between consultant and client
can pose conflict of interest
• For example, consultant:
- Is relative or former employee of the client
- Has ah extracurricular business or
financial relationship with the client
Notes:
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Scientific Bias
• Scientific bias can occur at all three stages of
technical information gathering and
evaluation:
- Sampling
- Analysis
- Data evaluation and modeling.
Notes:
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Technical Pitfalls in RCRA Cases
Types of Bias
• Positive Bias
• Negative Bias
• Erratic Data
Notes:
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RCRA Practitioners Enforcement Workshop Technical Pitfalls in RCRA Cases
Sampling Bias
• Geologic Characterization
- Drilling technology
- Cross contamination
- Composite Sampling
- Failure to archive soil samples
Notes:
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Sampling Bias (Continued)
• Geologic Characterization (continued)
- Random adjustment of the soil sampling interval
- Different consultants use different terms to
describe the same geology
- Inadequate number, depth, and location of
borings or wells
- Interpretation of geologic information
Notes:
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Sampling Bias (Continued)
• Ground Water Characterization
- Hydraulic properties of soils or aquifers
— Groundwater direction, velocity and
gradient
Notes:
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Technical Pitfalls in RCRA Cases
Sampling Bias (Continued)
• Ground Water Monitoring Wells
- Upgradient verses downgradient
- Monitoring well location
- Screen length
- Construction materials
- Improper grouting procedures and well
construction practices
Notes:
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Sampling Bias (Continued)
• Ground Water Sampling
- Use of bailers
- Sample bottles (clear versus amber)
- Field filtering of samples
- Exceedance of holding time
- Improper use of sampling equipment
- Decontamination of sampling equipment
- Sample transport and handling
Notes:
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Technical Pitfalls in RCRA Cases
Laboratory Analyses
• Common Sources of Error
- Composite samples
- Use of method not sensitive enough (or
detection limit too high)
- Use of wrong method
- Reporting selected contaminants
- Interferences/laboratory contaminants
- Lack of QA/QC samples and analyses
- Poor documentation
Notes:
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Modeling
• Selection of contour interval
• Contouring method or algorithm
• Omission of data
• Data "massaging"
• Reporting data ranges (instead of actual data
points)
Notes:
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Technical Pitfalls in RCRA. Cases
Statistical Analyses
• Excessive statistical treatment of chemical or
hydrogeological data should be viewed as a
"red flag."
• Graphical presentation of statistical data can
be misleading.
• Use of data transformations should be viewed
as "red flag."
• Seek assistance from professional statistician
and current EPA guidance.
Notes:
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Chain-of-Custody
A sample is under custody if:
• It is in your possession
• It is in your view, after being in your
possession
• You secured the sample in an appropriate
container and made arrangements to
transport it to the laboratory
• You transferred the sample to authorized
personnel
• It is held in a secure area.
Notes:
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WilsonJones. Quick Reference Index System
© 1991 Wilson Jones Company
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
2. PITFALLS IN RCRA CASES
Background Materials
f/EPA
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2. PITFALLS IN RCRA CASES
Understanding the information collected in a hazardous waste investigation poses a complex
challenge, especially in terms of data validity. The purpose of this module is to provide
information to help identify elements of environmental investigations with data most susceptible
to error, bias, or intentional manipulation and to understand how to recognize those errors, biases,
and manipulations.
2.1 TECHNICAL PITFALLS
Technical information used in RCRA cases can be biased in two ways:
• Bias introduced by consultants
• Scientific bias.
2.1.1 Bias Introduced by Consultants
One way to evaluate whether the information may be biased is to determine the type of
consultant supporting the project. The following types of consultants may introduce technical
bias:
• Non-affiliated consultants
• Consultants acting as "hired guns," knowingly or unknowingly
• Multi-consultant teams
• Low-bid consultants
• Unsupervised consultants
• Miscellaneous consultants.
Potential concerns associated with each are described below.
Non-Affiliated Consultant
Typically the non-affiliated consultant is unencumbered by any restrictions imposed by the
client. Often, such consultants are tenured university faculty and not-for-profit researchers.
Some corporate clients may be hesitant to use non-affiliated consultants because they exercise
less control over such entities and, therefore, may have concerns over the legal or economic
consequences of the consultant's findings. In some cases, it may be difficult to control their
scope of work because non-affiliated consultants are largely motivated by the search for answers.
Citizen groups may prefer non-affiliated consultants because they are least likely to come to the
table with unknown relationships and hidden agendas. Case development staff should be aware
that this type of entity may be subject to somewhat less control by the client than consultants in
other settings.
Consultant Acting as "Hired Gun"—Knowingly
A consultant knowingly acts as a "hired gun" when the client directs the consultant and the
consultant willingly agrees to the direction. This presents the concern that such a consultant's
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work product may be less than complete or serve to not fully inform or even mislead
enforcement staff. Case development staff can often identify this relationship through careful
examination of the investigatory approach. For example, the reviewer may find that the client
had instructed the consultant where to place monitoring wells, where to collect soil samples, or
what chemical analyses to perform. The reviewer may also note that the distribution or
placement of the monitoring wells tended to avoid areas where hazardous materials were known
to be handled.
One potential problem that may arise is the editing of reports by the client or the client's legal
counsel. For example, draft versions may show significant editing by the client that is
maintained in the final version. It is also possible that the client may have directed that
substantive changes be made in the technical conclusions or executive summary. These situations
may suggest tacit agreement by the consultant to be directed by the client. Therefore, reports that
have been edited by clients may warrant critical review for omissions, as well as stated technical
findings.
Consultant Acting as "Hired Gun"—Unknowingly
Sometimes, the consultant is unknowingly directed by the client. The client may filter
information given to the consultant (e.g., withholding information about spills or hazardous waste
activities in specific areas of a facility; identifying specific site areas for soil gas surveys, soil
borings, or well installations; and omitting knowledge about chemicals used at the facility). In
addition, the client may indirectly limit the project's technical scope by funding control (e.g., the
client may reduce the budget so that funds are not available for certain activities, such as
geophysical, soil gas analyses, examination of aerial photographs, and laboratory analyses
recommended by the consultant). These activities might have revealed the full extent of
contamination. This type of consultant situation presents the concern that information developed
by the consultant may not be complete or comprehensive.
Multi-Consultant Team
Frequently, a consultant is one of several working on a specific subtask of a large project;
each consultant, with similar capabilities, may be vying for a larger piece of the project. Multi-
consultant teams create a situation where bias may result. In certain instances, consultants who
satisfy the client are given larger roles or more tasks. Conversely, consultants who do not
perform in a manner amenable to the client are assigned fewer tasks or removed from the project.
This relationship may occur where large sums of money will be spent on environmental
consulting work (e.g., municipal or hazardous waste landfills). For example, a hazardous waste
operator may designate the environmental activities in the following manner:
• Consultant A performs ground water sampling
• Consultant B is responsible for monitoring well installation
• Consultant C logs the geologic profile during drilling
• Consultant D performs field or laboratory analyses of the sample.
Each consultant is aware of the other consultants (i.e., they are working together in the field)
and of the approximate dollar value of the work performed by each consultant. Each firm's
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project manager may seek to obtain a larger portion of the pie. One result is that project
personnel become pawns to upper management, who may violate a reasonable scientific practice
to acquire a larger piece of the project.
Sometimes a client insulates himself/herself somewhat from direct involvement by managing
the project through a management consultant, who is retained to oversee the technical consultants.
Low-Bid or Low-Cost Model Consultant
"Low bid" is where the client solicits fixed price bids from dozens of consultants, and the
consultant with the lowest priced bid (and usually the most limited scope) is awarded the
contract. In some cases, the winning consultant only may be capable of providing the client with
a minimum or substandard work product. One potential indicator of such a tactic or firm is
when all the engineers or scientists performing the field work are very junior level (e.g., recent
college graduates with a B.S., typically in geology, who usually have less than 1 year of
experience. Environmental work that can be performed by nearly any consultant (e.g., removal
of underground storage tanks) or laboratory analysis (e.g., TDS, pH measurements) is most
amenable to a low bid, client-consultant relationship.
Low-bid environmental projects can result in incomplete or qualitative findings. The work
is usually re-visited to obtain information that was not collected during the original investigation
because of cost or staffing constraints. This must be kept in mind when a low bid client-
consultant relationship has been identified.
Unsupervised Consultant
Consultants may not be supervised if an unsophisticated client with significant financial
resources requires an environmental investigation. The client may place total faith in the
consultant, and the consultant may see an opportunity to perform superfluous work—work that
may not be germane to an enforcement investigation. A consulting firm that is vertically
integrated (i.e., has drilling, consulting, physical and analytical laboratory, and remediation
services) offers the greatest danger. This type of consultant situation is typified by activities that
do not provide information directly related to the project, for example:
• Excessive laboratory analyses (especially when the consultant also owns the laboratory)
• Extensive use of geophysical or other "black box" qualitative tools in the investigation
(consultant has large capital investment in this equipment)
• Seemingly superfluous activities (e.g., fish trawls at a nearby lake, microscopic
examination of the crystalline structure of the soils, infrared satellite imagery, or excessive
analyses of aerial photography)
• Over-emphasis on ground water or contaminant transport modeling exercises (a.k.a.
financial black holes)
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• Extensive geotechnical soil testing (e.g., shear, triaxial), which'have little applicability to
a hazardous waste investigation (often indicates that the firms or project manager is a
reborn geotechnical firm/engineer).
This situation is often revealed through an audit initiated by the client's controller or legal
counsel. The original consultant is often removed from the project and a second consultant is
retained to perform the work that should have been done by the first consultant.
Miscellaneous Consultant
A number of other consultants can introduce bias, including the following:
• A consultant that is a former employee of the client
• A consultant that has a non-business-related relationship with the client
• A consultant that has an extracurricular business or financial relationship (e.g., joint
ownership in a small business or real estate) with the client
• A consulting firm that. is. a subsidiary of the client (e.g., environmental consulting firm
performs Phase I environmental audits for the real estate developer/owner).
2.1.2 Scientific Bias
Scientific bias can occur at all three stages of technical information gathering and evaluation:
1. Sampling—Gathering data in the field
2. Analysis—Evaluating data in the lab
3. Modeling—Using computers or mathematical calculations to extrapolate field data or
assess future site conditions and contaminant transport.
Types of Bias
Three basic type of bias exist:
• Positive Bias—In a monitoring context, a positive bias arises when a test incorrectly
indicates contamination or an increase in contamination at a regulated unit when none
exists.
• Negative Bias—In a monitoring context, a negative bias occurs when monitoring fails to
detect contamination or an increase in concentration of a hazardous constituent.
• Erratic Data—In a monitoring context, data can be collected that are so anomalous that
it is difficult to develop trends and correlations.
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Sampling Bias
Biasing the Geologic Characterization
Numerous factors can result in biasing the geologic characterization phase:
• The drilling technology can affect a geologist's ability to accurately describe the lithology
of a borehole. Air or mud rotary are examples of drilling methods that significantly affect
the ability to characterize the geology accurately.
• Improper or inadequate cleaning of the drilling equipment between boreholes. For
example, failure to properly steam clean hollow stem augers between boreholes can cross
contaminate boreholes with contaminated soils smeared onto the auger.
• Collection of "composite" soil samples rather than discrete samples for physical or
hydraulic testing.
• Failure to archive soil samples for future analyses or testing.
• Random adjustment of the soil sampling interval. For example, collecting soil samples at
a geologically complex site at different depths in different boreholes or within the same
borehole results in a confusing array of data for geologic correlation. Larger soil
sampling intervals (> 10 ft) preclude developing a detailed mapping of site soils. The
same technique can be used successfully to create erratic chemical results when these soil
samples are collected for chemical analysis.
• The use of different consultants who use different terms to describe the same soil or
geologic formation. This often occurs at sites that have been investigated over a long
period (more than 10 years).
Example
The same soil is described by four consultants as follows:
• Consultant 1—Silty sand
• Consultant 2—Sandy silt
• Consultant 3—Medium grained sand
• Consultant 4^Dune sands.
Consultant 4 is asked to peer review the previous geologic
descriptions. He/she is at a loss to rigorously correlate the
geologic descriptions into one comprehensive geologic picture.
• The use of different, but acceptable, standards to classify soils. One consultant using the
USDA classification scheme will call a soil with a particle size of 0.02 to 0.10 mm a
"silt," while a consultant using the International Soil Science Society classification scheme
will call the same soil "sand." Both are correct. It is imperative, therefore, to know what
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classification scheme is used. The same is true for describing the soil color. A
standardized color chart such as the Munsell Soil color chart should be used by
consultants logging boreholes. These charts standardize soil, hue, chroma, and value.
Otherwise, a "gray" soil to one person may be a "brown" soil to another.
• Performance of soil borings where:
- The number of soil borings is insufficient to properly characterize the geologic
environment.
- Borings are not deep enough to characterize the geologic profile of interest.
- Borings are located to preclude developing useful information for characterizing the
geologic setting.
• Interpretation of geologic information. A tremendous amount of interpretative latitude
is available to the geologist when using boring log information to create geologic cross
sections. These interpretations become extremely important when one interprets horizons
as "confining layers" to the flow of contaminates.
Allowing a computer to "interpret" geologic information and portray these results
graphically can result in highly erroneous interpretations. Numerous opportunities exist
for gross errors in computer interpretation. Geologic profiles can be correlated using a
variety of mathematical techniques, the most common being a linear or spline fit..
One needs to carefully examine both the vertical and horizontal scales as the vertical,
especially, is often a reduced scale and can be highly misleading in terms of viewer
perceptions.
Ground Water Characterization
Bias may also affect ground water characterization. Areas of concern include hydraulic
properties of soils or aquifers, ground water flow, and ground water monitoring wells.
Hydraulic Properties of Soils or Aquifers. Numerous hydraulic properties directly affect
one's knowledge of contaminant transport in soils and ground water. The most common
hydraulic properties measured and reported are:
• Permeability—The property or capacity of a porous rock, sediment, or soil for
transmitting a fluid
• Porosity—The percentage of the bulk volume of a rock or soil that is occupied by
interstices, whether isolated or connected
• Transmissivity—The fate at which liquid is transmitted through a unit width of an
aquifer under a unit hydraulic gradient
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• Hydraulic Conductivity—The rate of flow of water in gallons per day through a cross
section of 1 square foot under a unit hydraulic gradient at a prevailing temperature
• Hydraulic Gradient—The rate of change in total head per unit of distance of flow in a
given direction.
These properties are usually measured in either the field or laboratory. The "representativeness"
of measured values depends on where they were measured (i.e., in the field or laboratory). The
three most common methods of measuring saturated hydraulic conductivity of an aquifer are
(listed from least to most accurate method):
• Laboratory
• Slug test (field)
• Pump test (field).
Ground Water Direction, Velocity, and Gradient. Direction, velocity, and gradient of the
ground water are critical pieces of information needed for examining contaminant transport.
Common errors found when determining ground water direction, velocity, and gradient are:
• Installing a well (to measure ground water levels) near activities that may disrupt the
aquifer, for example:
- Municipal wells that are periodically pumped
- Surface water bodies (streams, lakes) with highly fluctuating flows
- Surface water bodies that exhibit both effluent and influent characteristics during
different times of the year
- Surface and ground water bodies that are influenced by tidal, cycles
- Leaking sewer or water mains.
• Inaccurately surveying monitoring wells. This error is usually discovered after additional
wells are installed in what were thought to be upgradient (or downgradient) locations.
Wells should be surveyed to a vertical accuracy of 0.01 foot.
• Using inaccurate measuring equipment or technique. For example, Exhibit 2-1 illustrates
the difference between water levels measured with a steel-tape versus pressure transducers
(from D. Rosenberry. 1990. Effect of Sensor Error on Interpretation of Long-Term Water-
Level Data. Ground Water. Vol. 28(6), 927-936). There is sufficient error in the two
measurement techniques to produce misleading information about the direction of ground
water flow, especially for small ground water gradients and/or small sites (< 500 acres).
Knowing what equipment was used to measure the ground water elevations and if the
method of measurement was frequently changed can help to explain apparent anomalies in
ground water flow patterns.
Taking ground water level measurements from three widely spaced (thousands of feet)
monitoring wells. This may not provide sufficient data about local ground water flow and
direction.
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Exhibit 2-1. Water Levels in Seven Wells Measured Using a Chalked-Steel Tape (top)
and Pressure Transducers (bottom), Mirror Lake, New Hampshire
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• Combining ground water level measurements from wells that may be screened in
hydraulically disconnected aquifers. This can be misleading if the data are used to create
a ground water contour map that shows a single aquifer.
• Completing wells in a confined and unconfined aquifer. This can result in a water level
value that is representative of only the confined aquifer.
• Using large-scale regional maps to determine groundwater flow and direction rather than
installing wells onsite. USGS (U.S. Geological Survey) map scales are large—1 inch
usually equals 24,000 feet. Small-scale differences in ground water flow direction are
usually not reflected in "regional" ground water flow maps.
• Accepting reported ground water direction or velocity a priori without carefully reviewing
the actual measurements. This includes plotting the data to create a ground water contour
map. The ground water direction yielded from the graphing should be compared to the
general direction of reported ground water flow.
• Using inconsistent units of measure throughout the reports. When there are tremendous
amounts of data from numerous reports written by different consultants, it becomes a
reviewer's nightmare to constantly change the various units to common denominator units.
Example
Ground water velocity can be reported in Darcy's Meinzer (gal. per day per ft.2), metric (cm/sec), and/or
U.S. (ft/day) units. Interchanging parts per million (ppm) with mg/L sometimes occurs. Clients may ask
their consultant to put concentrations in ppm rather than ppb so that the values are perceived to be very
small.
Ground Water Monitoring Wells. The definition of upgradient and downgradient may not
be dear in many hydrogeologic systems. This is significant because ambiguities can be reported
or manipulated to distort what is hydraulically background or downgradient. For example, what
is "upgradient" and "downgradient" for an island with a landfill in the center of the island? The
same question may be asked of a source located in a pueblo atop an isolated mesa in New
Mexico. A different scenario is tidally impacted wells. A downgradient well may be monitoring
changes in apparent ground water quality that is actually tidally controlled surface waters.
The monitoring well location may also be manipulated to varying extents. Given sufficient
information on the hydrogeology and physical characteristics of the chemical released into the
subsurface environment, one can locate wells that will not detect the chemical(s) of interest or
will significantly underestimate/overestimate the presence of the contaminant in the ground water.
Examples include selecting a well location that is influenced by nearby surface waters and
placing wells far from known areas of contaminant releases.
The screen length of a monitoring well also may affect monitoring or sampling results. A
well screened the entire depth of an aquifer can significantly dilute a contaminant entering the
well at one discrete depth. This results in a negative bias. In addition, in wells with short
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(< 10 ft) screened lengths, a contaminant traveling in a discrete layer, usually one with a higher
hydraulic conductivity, can be missed.
Combining data from poorly located and screened wells with data from wells that are properly
located and screened (i.e., "integrating") often results is highly erratic hydraulic and chemical data
that do not reveal clearly discernible (statistically) hydraulic or chemical trends. This frequently
occurs at sites where wells were installed for different purposes and construction standards
combined.
Construction materials used for monitoring wells also have the potential to affect sampling
data. When the contaminant level is near analytical detection limits, casing and screen materials
can significantly affect whether these chemicals are detected in the ground water sample.
The most commonly used well construction materials and potential associated issues are:
• Teflon® (PTFE-poIytetrafluoroethylene)—This is the material of choice, though very
expensive.
• Stainless steel 304 or 316 grade—This may leach out certain metals and may also
provide a substrate for microbiological growth on the casing/screen and in the immediate
vicinity of the well.
• PVC (polyvinylchloride)—PVC may sorb certain chemicals (permetherin, for example,
can be preferentially sorbed by PVC). PVC can leach certain plasticizers or fail when in
contact with certain free phase compounds, primarily aromatic hydrocarbons. At least 80
percent of all monitoring wells installed in the United States are estimated to be
constructed of PVC.
If monitoring wells are constructed from different materials, this might indicate an attempt to
manipulate the chemical data through well construction materials. It may also suggest several
generations of consultants working at the site who had different construction material preferences.
Another potential problem is elevating the pH of a sample through improper grouting
procedures or use of inappropriate grouting materials. Cement grout (CaC03) as a sealant in a
monitoring well can raise the pH of the surrounding soil by as much as 3 to 4 pH units.
Elevated pH in the vicinity of the well screen may cause precipitation of otherwise soluble metals
as they enter this halo of higher pH ground water. The result may be that these precipitate trace
metals are not detected in the ground water sample.
In addition, ground water wells may possibly spread contaminants into uncontaminated
aquifers through a variety of means:
• Sloppy well construction practices, of which the most important is grouting.
• Poorly constructed security covers or valve boxes that allows surface seepage into the
well.
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• Drilling through a confining layer.
• Screening of a monitoring well across several geologic/soil horizons, of which only the
upper horizon was originally contaminated. Contaminants from the upper, contaminated
zone enter the lower, previously uncontaminated zone.
• Introduction of a contaminant into a lower zone by using a drilling method, such as a
hollow stem auger, that smears a contaminant from a higher zone into a lower zone.
Cross contamination of previously uncontaminated boreholes may also be caused by
augers that are not steam cleaned between drilling.
• Drilling through a confining layer that separates an upper, contaminated layer from a
lower, uncontaminated layer. The consultant backfills the lower portion of the borehole
with bentonite or cement in an attempt to remediate (or hide), the "overdrilling" of the
borehole.
Ground Water Sampling
Ground water sampling probably represents the greatest opportunity of all field activities for
biasing the chemistry of a sample. This results from field sampling, field decontamination, and
sample transport and handling.
Field sampling procedures, especially when looking for volatile compounds (which includes
many hydrocarbons and solvents), usually result in negative bias (i.e., failure to detect). Reasons
for this include:
• Ground water sampling with a bailer—Sample aeration during sample transfer from
bailer to sample container airstrips the volatile compounds.
• Sample bottles—The use a clear rather than amber bottle affects compounds sensitive
to photo-oxidation.
• Filtered samples in the field—Many metals, such as iron, oxidize and precipitate onto
solids during repeated handling in the field during field filtering.
• Sample holding time (i.e., time between sampling and analysis)—The longer the
holding time, the greater the negative bias. Recent allegations of fraud committed by
EPA contractors included backdating when chemical analyses were performed.
Otherwise, EPA-specified holding times would have been exceeded.
• Improper use of state of the art sampling equipment—Examples of improper use
include overpressurizing a dedicated bladder pump (analogous to air stripping a water
sample prior to sampling) when the contaminant of interest is a VOC (volatile organic
compound). Also, pumping at excessive pumping rates (e.g., > 1,000 ml/min).
Field decontamination of sampling equipment represents a major source of positive bias.
There is a greater probability of cross contamination between boreholes when sampling
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equipment is cleaned in the field versus a laboratory, where QA/QC procedures are followed
more rigorously. However, it is more expensive to hire a laboratory to clean equipment.
Dedicating a set of sampling equipment, such as the pump and bailer, to each well also reduces
the chance of cross contamination. Field decontamination often indicates a "low bid" client/
consultant relationship.
Sample transport and handling is also a source of bias. Common problems include:
• Cross contamination via diffusion through the porous Teflon® and silicone rubber septum
of a 40 ml vial. This can produce erratic data between sampling events.
• Contamination from the ice chest used to transport samples. There may be freon (from
the styrofoam) in the ice chest, or volatile compounds may remain from grossly
contaminated samples in a previous shipment. This usually results in positive bias.
• Cross contamination from samples transported within the same ice chest. For example,
adhesives in electrical tape contain toluene (at the ppm level) that can diffuse into a water
or soil sample via the permeable Teflon® or silicone septum. This usually results in a
positive bias.
• Sample bottles were not cleaned properly before sampling. (A certificate or
documentation documenting its cleaning and QA/QC procedures should be requested.)
This may result in positive bias.
Laboratory Analyses Bias
Laboratory error may also affect the accuracy of sampling data. Common sources of error and
issues to be aware of include the following:
• Compositing samples, in. which samples (usually soils) are mixed, creating a
"homogenized" sample for analysis. Compositing usually results in a chemical dilution
of the sample (due to physical "averaging." of constituent concentration data). Samples
to be analyzed for volatiles should be collected and maintained in an as undisturbed state
as possible and never be mixed, homogenized, or composited in the field.
• Using a high detection limit (e.g., 500 ppb versus 5 ppb) to mask the presence of
compounds at lower levels.
Example
A consultant uses a 5 ppb detection level on the first round of sampling. He replaces the lower limit with a
detection level of 100 ppb on subsequent analyses, citing cost as the reason (i.e., cheaper analyses when a
higher detection limit is used). The true purpose may be to avoid detecting contaminants below the 10 ppb
limit.
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• Selecting an analytical method that will not analyze for what is a suspected contaminant
in the sample.
• Requesting and reporting analytical results for only the contaminant(s) of interest,
although the analytical method analyzes for other contaminants (i.e., laboratories refer to
this as "blinders"). For example, a site is contaminated with industrial solvents. Ground
water samples will be analyzed by EPA Method 601. In the environmental report, results
are summarized for TCE, PCE and TCA. Vinyl chloride, which is almost always found
in concert with TCE and is one of the 28 compounds analyzed in Method 601, is not
reported. Vinyl chloride is more toxic than PCE or TCE. The original laboratory data
sheets are not included in the report.
• Selecting an analytical method that may significantly bias the results.
Example
A client asks a consultant to characterize the extent of apparent TPH (total petroleum hydrocarbon)
contamination detected in soil at a gas station. After collecting soil samples the consultant asks the laboratory
to analyze the soils for TPH using infrared (IR) spectrometry (Method 418.1). The analyses reveal gross
contamination (> 1,500 mg/kg). The state requires cleanup to a level of 1,000 mg/kg. Remediation commences.
During remediation, the state collects samples, analyzes the soils, and finds that all samples tested are below,
< 200 mg/kg. Remediation is not necessary. The client is irate.
One explanation is that IR analysis, compared to gas chromatography (GC) (Method 8015), frequently
overestimates the presence of TPH. For example, the analytical results by both IR and GC of 13 soil samples
are presented in Exhibit 2-2. TPH results by IR were consistently higher than by GC.
• Not understanding the effect a calibration standard has on a chemical analysis (i.e., some
standards will result in consistently higher, or lower, values).
For example, a consultant and state regulatory split six soil samples taken at an oil
refinery. The two sample sets are analyzed at different laboratories. The state's results
are higher than the consultant's. Whose values are correct?
In this example, the differences arise from the calibration standard. Exhibit 2-3 lists the
TPH results under two commonly used calibration standards—#6 fuel oil and free
product. The soil sample analyzed using the free product standard procedures consistently
lower TPH values.
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RCRA Practitioners Enforcement Workshop
Pitfalls in RCRA Cases
Exhibit 2-2. TPH Analyses by Infrared and Gas Chromatography
Sample
TPH (mg/kg)
by IR
by GC
1
317
69
2
250
75
3
172
60
4
167
105
5
160
65
6
153
114
7
148
109
8
144
109
9
136
48
10
110
67
11
76
9
12
33
10
13
not detected
10
Source: R. Block, T. Clark, and C. Swanberg. Proper Calibration Standard Is Key
to Success of Soil Treatment. Soils. November-December 1990. pp. 32-33.
Exhibit 2-3. Total Petroleum Hydrocarbon (TPH) by GC (mg/kg)*
Sample Number
#6 Fuel Oil Standard
Free Product Standard
1
3380
2273
2
525
347
3
507
332
4
443
290
5
217
112
6
113
57
*Results of TPH analyses of soil samples from a single site under two standards indicate the measured value of
TPH is greatly dependent on the calibration standard.
Source: R. Block, T. Clark, and C. Swanberg. Proper Calibration Standard Is Key to Success of Soil Treatment.
Soils. November-December 1990. pp. 32-33.
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• The extraction method can bias the sample.
• Using several laboratories during a project, especially in a low bid scenario, can produce
dramatically different analytical results. Issues include:
- The analytical results from a low bid laboratory should be treated with suspicion
when common laboratory contaminants are present.
- Common laboratory contaminants are:
~ Methylene chloride
— Acetone
— Freon 113 (l,l,2-Trichlor-l,2,2-Trifluoroethane)
~ Chloroform
— Carbon tetrachloride
— Toluene
- BTEX (benzene, toluene, ethylbenzene, and xylene) are- also common laboratory
artifacts due to the large volume of BTEX analyses processed through most
laboratories.
- Cross contamination (positive bias) is a common error associated with BTEX
analyses.
• No duplicate, field blanks, laboratory blanks, or spiked samples are analyzed. No QA/QC
documentation.
• Original laboratory work (gas chromatograms, for example) are not included or are not
available upon request.
• The consulting firm conducting the field investigation uses its in-house laboratory to
analyze the chemicals. This arrangement adds a menu of analyses that are unnecessary.
• Core dumping the original laboratory data into long tables placed in the appendices. The
tables are photocopies and reduced several times, which tends to obscure significant data.
Other indicators are:
- Limited or cursory discussion of the analytical results in the body of the report.
- Tables within the body of the report show only selected analyses, while the complete,
and possibly important, analytical results are buried in the appendices.
Contaminant Modeling and Statistical Analyses Bias
Contaminant modeling and statistical analysis also present opportunities for data to be
misinterpreted or manipulated. Below are key points to remember:
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• A model is a simplified representation of conditions that are too intricate to be formulated
in complete detail. The model does not encompass the complete reality, but rather only
selected aspects of this reality.
• Models and their graphic representations take on a life of their own. A graphical
portrayal of a site created by a model tends to become reality in the eye of the beholder.
This is especially dangerous in terms of presenting a computer-generated model to a judge
or jury.
• Models offer tremendous opportunities for manipulation: one usually does not model
unless a presumed condition can be validated by the model. Model calibration provides
an opportunity to fudge the model to correspond to observed data.
• The focus should be on the input parameters, especially aquifer hydraulic properties, such
as ground water velocity, retardation factor coefficients (Kd), sorptivity, and dispersivity.
Remember that the more complex the model, the more parameters are required. As input
parameters are difficult to measure, these complex models become more difficult to
validate.
• Even if the model begins with an unbiased effort, the resulting graphical portrayal can be
biased.
The graphical manipulation of scientific data presents specific issues of concern, including:
• Varying the contour interval of two-dimensional contours can transform the perceived
contaminant source and magnitude of the contamination. Exhibit 2-4 presents an example
of this, showing three, two-dimensional contours generated with the software program
SURFER. Each contour was created using identical analytical TCE data with a single
variable, the contour interval or density. More information about potential sources and
breadth of contamination manifests as the interval decreases, from 15 ppm (bottom graph)
to 1 ppm (top graph). Source areas and other possibly useful features differ significantly,
depending on whether one is viewing the upper or lower most contour map. The contour
interval is usually lett up to the environmental consultant. (The client usually does not
specify the contour interval.)
• With three-dimensional contours, one can adjust the many variables in a 3D contour to
affect the view of a site. Exhibit 2-5 illustrates what the same surface data look like at
angles of inclination of 5, 15, 45, and 75 degrees.
By changing the angle of inclination, the relief (i.e., perception of contamination) changes.
A higher angle results in a less defined relief. It is important, therefore, to understand
this bias and to consider having the consultant provide graphs at different angles of
inclination if one feels that the original graphical portrayal is biased.
The 3D figures in Exhibit 2-6 illustrate how rotation can affect the interpretation of data.
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iCE CQnC-'Lin ! HA! ION (ppm)
JJ 45 >0 6* >5 63 9?'*00 106 llJ 135 133 1«3 150 IU 167 >75 i&3 I
100
93
63
75
87
5ft
50
42
53
25
17
6
0
100
93
13
75
67
JO «
0> 50
V
2
_ 1 ¦ ^— - ....
.55 <2 50 56' 47 75 65 93 100 106 117,135 133 143 150 156 167 175 183
SCALE 1 inch - 25 doto units
TCE CONCENTRATION (ppm)
17 35 33 O 50 56 47 75 aj 93 100 106 1 17 135 133 143 150 156 167 175 163 193 300
_1_
6 1 7 35 33 42
50 56 .67 75 63 S3 100 106 117 125 133 143 150 156 167 175 163 I
SCALE 1 inch » 25 doto units
TCE CONCENTRATION (ppm)
33 23 41 40 li 17 '73 S3 M 100 108 117 IIS 133 I
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RCRA Practitioners Enforcement Workshop
Pitfalls in RCRA Cases
Exhibit 2-5. 3D Contours at Angles of Inclination of 5, 15, 45, and 75 Degrees
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Exhibit 2-6. TCE Concentration Rotated at 210 Degrees and 260 Degrees
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Both figures are generated from the same data set with an angle of inclination of
30 degrees. The spikes represent TCE concentration detected in an area through
sampling; the taller the spike, the higher the level of TCE.
The rotation differs in each figure. The rotation is 210 degrees in the left figure and
260 degrees in the right. It is significant that in the right figure a second, very high TCE
spike is clearly apparent, suggesting another source of contamination; this spike is
obscured in the left figure.
The selection of a figure's rotation is usually at the discretion of the computer
programmer.
• The contouring method or algorithm can have a pronounced impact on the final shape of
a contour. The most common contouring methods are inverse distance, kriging, and the
minimum curvature method, all of which are scientifically valid.
- Inverse distance—Weights the influence of a single data point over all others. Its
influence declines as one proceeds farther from the point. The greater the weighing
power, the faster the decrease in influence on the interpolation.
- Kriging—Assumes an underlying linear variogram. This method is more accurate
than the inverse distance method except for areas of missing data.
- Minimum curvature method—Calculates the initial values of the grid based on the
data, then repeatedly smoothes the gridded surface. Projects trends in areas of
missing data, which causes more variation than the inverse distance method.
Exhibit 2-7 illustrates contours, using the same data set (11 data points) and contour
density, but different contouring algorithms.
Each contour appears different. When there is a high data density (i.e., many data points)
in a small area, kriging provides the most accurate portrayal of conditions represented (see
the left side of the maps). Where there is very low data density (see the right side where
there were only three data points), minimum curvature provides the least accurate
representation. Given the overall data density and range of values, the inverse distance
method is probably the most representative, although the other methods may be more
accurate over limited sections of the map.
• Data that may be unfavorable to one's technical case can be omitted. A consultant may
use the excuse that the data are anomalous or represent background values.
• Data "massaging," such as smoothing, averaging, and moving averages, can be used.
Smoothing and averaging conceals high (and low) contaminant levels. Actual values on
a particular date should be used in graphs and contours.
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Molhod: Minimum Curvature
Exhibit 2-7. TCE Concentrations Under Three Contouring Methods—Inverse Distance,
Kriging, and Minimum Curvature
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• Data ranges can be used instead of actual data points, and/or non-uniform contour
intervals. This practice fails to locate contaminant sources that would be more apparent
under usual contouring practices.
• The selected data may not be graphed at all. The analytical results are simply posted on
a site map in table form next to the monitoring well or sampling location.
Statistical analyses also introduce the opportunity for data to manipulated. Major concerns
are identified below:
• Excessive,statistical treatment of chemical or hydrogeological data should be viewed as
a "red flag."
• Graphical presentation of statistical data is often misleading; be wary of graphs with axes
converted to logarithmic scale ("logged") or with data excessively smoothed (e.g., cubic
splining, high [> 5] degree polynomials).
• The use of "data transformations can lead to bias. For example, in making a hazardous
waste determination, SW-846 recommends the calculation of the upper confidence limit
for comparison to the TC regulatory level. Often, environmental data do not exhibit a
normal distribution, and the consultant might perform a data transformation (such as a
log-normal transformation) to linearize the data set. One seemingly plausible, but
incorrect, method sometimes employed by consultants is to transform the data to the log
scale, apply the standard normal theory statistics to the transformed data, and then
retransform the results back to the original scale for comparison to the regulatory level.
This method is incorrect and results in a biased estimate of the mean and confidence
limit. Consult a professional statistician or see Gilbert, R.O. 1987. Statistical Methods
for Environmental Pollution Monitoring. Van Nostrand Reinhold, New York; EPA. 1992.
Supplemental Guidance to RAGS: Calculating the Concentration Term, Volume
Number 1. OERR Publication 9285.7-081.
Guidance on correct statistical methods for the evaluation of ground water monitoring
data is presented in U.S. EPA. 1992. Statistical Training Course for Ground-Water
Monitoring Data Analysis. EPA/530/R-93/003. [NOTE: Contains Statistical Analysis
of Ground-Water Monitoring Data at RCRA Facilities, Addendum to Interim Final
Guidance.]
2.2 LEGAL PITFALLS
Two legal issues that arise are chain-of-custody and authentication of documents. The
possession of samples must be traceable from the time the sample are collected until they or the
data derived from the samples are introduced as evidence in legal proceedings. Chain-of-custody
is a very important aspect of the inspection, case development, and presentation of the evidence
during litigation. It is often attacked during litigation and could adversely affect the credibility
of EPA's case, if not get it dismissed altogether.
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A sample is under custody if:
• It is in your possession.
• It is in your view, after being in your possession.
• You secured the sample in an appropriate container and made arrangements to transport
it to the laboratory.
• You transferred the sample to authorized personnel.
• It is held in a secure area.
• Technical considerations
- Chain-of-custody record must demonstrate who is responsible for evidence at any
given time
- Removal of physical evidence (if you really need to remove it, document with
photos, use evidence log, be sure to give receipt and get signature from other party)
- Considerations after leaving site (e.g., minimize the number of people in the chain,
make sure that evidence is properly stored).
• Legal consideration
- Sample and evidence are accompanied by a Chain-of-Custody Record. When
transferring the possession of samples, the individuals relinquishing and receiving
will sign, date, and note the time on the record. All sample shipments should be
accompanied by the completed Chain-of-Custody Record.
Remember, documentation is key.
The second legal issue of concern is the authentication of documents. Authenticating
documents is the process of establishing, through the use of different forms of evidence, that a
document is what it purports to be (i.e., that a document has not been created or altered such that
it lacks the credibility required by the administrative or legal process). Such authentication often
becomes an issue when the Agency is filing for an accelerated decision, is placing a document
into evidence, or is requesting that a document become part of the record. The authenticity of
virtually any document (e.g., field logbooks, notes, reports, etc.) may be challenged. Hence, it
is important to be able to authenticate each document that will be used in evidence. To
authenticate documents, the Agency must be able to show, at a minimum, when and how the
evidence in question was gathered (i.e., during an inspection), as well as demonstrate the
document's authorship, where copies were located within a facility, and to whom it was
distributed. The process of authentication relies primarily on documenting how the information
or document was discovered and obtained, and can extend to how the information or document
was developed. Such documentation may consist of notes in a field log (specificially describing
the exact source of the document and the reason for collecting it are important), testimony, or
even photographs. In addition, routine documentation procedures such as tagging, or initialling,
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signing, and dating documents aides in confirming how, where, and when information was
obtained. Although documents are not subject to chain-of-custody requirements that are as
formal as those required for physical samples, documenting the chain-of-custody for documentary
evidence aides in authentication. Thus, the key is good documentation. The discussion in
Module 1, Obtaining and Developing Evidence, also addresses the importance of documenting
information as evidence is collected.
2.3 CONCLUSIONS AND RECOMMENDATIONS
The following recommendations should be kept in mind when evaluating a case that involves
technical issues or relies upon data to prove or refute key elements:
• Do not accept an environmental report as gospel simply because it was generated by
large, national consulting firm. A person gathers and interprets the data, not a firm.
Develop a confidence level with an individual and his/her knowledge and insist that this
person perform or directly manage the project.
• In a hazardous waste project involving soil or ground water issues, always have a chemist
and hydrogeologist examine the technical data and identify issues. There is no substitute
for experts in these two disciplines.
• Require the consultant to submit supporting laboratory data sheets and field notes with
a report.
• The greater the dollar volume of the work, the greater the motivation for direct data
manipulation.
• Require that all work undergo peer review.
• Do not rely on computer models and graphics—think.
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M
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3
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
3. PREPARING THE EXPERT WITNESS
SEPA
72
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Module 3 Objectives
• Understand the role of the expert witness
• Discuss techniques for preparing the expert
witness for deposition and trial
• Review techniques for deposing and
examining the opponent's expert witness
• Discuss "dos and don'ts" of providing expert
witness support
• Delineate methods for assisting counsel at the
deposition of the opponent's expert
Notes:
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Reasons for Expert Testimony
• Explain factual issues to the court
• Prove essential elements of the case
• Provide an advocate for the government's
position
WTO DO:
EXPLAIN FACTS
PROVE EUMEHTS
ADVOCATE
Notes:
2
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Role of Expert Witness
Assist court in understanding technical issues
Supply expert opinions
Assist with evaluating the merits of the
government's case, as well as the merits of the
opponent's case
Assist with pre-trial discovery
Assist with settlement negotiation
Notes:
3
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Pre-Trial Preparation
• Start preparing early
• Simplify your case to a college freshman level
• Meet frequently
• Review technical information of all experts
Notes:
FROSH
SCHEDULE
Geology 101
Biology 101
English 101
4
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Pre-Trial Preparation of Expert (Continued)
• Develop strategy to deal with privilege issues
• Conduct necessary examinations, tests, and
studies
• Prepare a written report of analyses and
findings
• Assist in framing discovery requests and
reviewing discovery requests
Notes:
5
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Prepare the Expert for Deposition
• Be prepared
• Limit talk
• Listen to the question
• Ensure expert has heard the question
properly
• Provide expert with all technical material
and ensure its review prior to deposition
Notes:
6
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Deposing and Examining the Defendant's Expert
• Review all reports and literature that are
likely to be prepared/relied upon by the
expert
• Know the expert
• Have the expert identify/produce all
information reviewed for the case
• Understand the expert's "formula" and how
the expert arrived at his or her results
• Conduct a line-by-line review of documents
produced by the expert
Notes:
7
/06
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Steps in Providing Pre-Trial Assistance to
Counsel
• Understand the litigation schedule
• Prioritize case work over other business
• Review all relevant work (colleagues and
experts retained by the other side)
• Understand the case your attorneys are
trying to make
• Understand your role, as well as the other
expert's
• Identify areas of agreement and
disagreement within the team
Notes:
/'/
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Steps in Providing Pre-Trial Assistance to
Counsel (Continued)
List each key fact in your area of expertise
Develop lists of facts you need your attorney
to explore to fill in data gaps
Develop proof of all key issues
Develop a comprehensive presentation of
your information
Document your work
Conduct a thorough search for documents
you intend to rely on or use
Notes:
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RCRA Practitioners Enforcement Workshop
Expert Witness Preparation
Assisting at the Deposition of the Opponent's
Expert
• Review the work of the opponent's expert
• Simplify the case
• Buttress your own testimony
• Identify inaccuracies and areas of deficiencies
Notes:
AS?
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Expert Witness Preparation
Direct Testimony
• Tell your story
• Respect the judge
• Answer questions in common English
• Use your normal teaching style
Notes:
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Wilson Jones* Quick Reference Index System
© 1991 Wilson Jones Company
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
3. PREPARING THE EXPERT WITNESS
Background Materials
&EPA
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INSTRUCTOR NOTES
RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
3. PREPARING THE EXPERT WITNESS
Time: 1 hour
Objectives:
¦ Familiarize RCRA case development staff with the role of the expert witness in support of
the government's case.
¦ Introduce government attorneys to the value of the expert witness in all phases of the
litigation.
¦ Familiarize government attorneys with methods and techniques for preparing the expert
witness for deposition and trial.
¦ Introduce government attorneys to techniques for deposing and examining the opponent's
expert witness.
¦ Train RCRA technical staff in the basic "dos and don'ts" of providing expert witness
support at deposition and trial.
¦ Introduce RCRA technical staff to methods of assisting counsel at the deposition of the
opponent's expert.
Emphases:
¦ Role of the expert witness in environmental litigation.
¦ Techniques for the government attorney to utilize an expert witness to the fullest.
- Expert witness support in pre-trial activities.
- Preparation of expert witness for deposition and trial.
¦ Techniques for the attorney to depose and cross examine opposing parties' expert witness.
¦ Techniques for the government expert witness in preparing for deposition and trial.
¦ Ways to be an effective expert witness when deposed and cross-examined by opposing
counsel.
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RCRA Practitioners Enforcement Workshop
Preparing the Expert Witness
Helpful Hints:
¦ Use the sample exercise to open up discussion on the pitfalls of expert witness practice.
Use at the beginning and the end of the module if time permits.
¦ Draw on as many relevant real life experiences as you can and interact with your audience
by asking them to comment.
¦ Provide hypothetical examples when appropriate, "what if . . . ?"
¦ Use overheads.
Bibliography:
Buckheit, Bruce. Expert Witness Practice. EPA material.
Danner, Douglas. 1983. Expert Witness Checklists. Lawyers Co-Operative Publishing Co.
Rochester, N.Y., Bancroft-Whitney Co., San Francisco, CA.
U.S. Environmental Protection Agency (EPA). 1993 (March). RCRA Practitioners
Enforcement Workshop: Course Materials.
EPA. No date. RCRA Inspector Institute: Inspector's Addendum.
September 1995
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RCRA Practitioners Enforcement Workshop Preparing the Expert Witness
3. PREPARING THE EXPERT WITNESS
3.1 INTRODUCTION
Experts and specialists have value and
importance in environmental litigation. For three
reasons, both counsel and experts should
understand how the effective use of expert
opinion and testimony can bolster the
government's case, and perhaps lead to an early
out-of-court settlement. First, the subject matter
and field of knowledge needed in today's environmental litigation is often so complex or
theoretical that only an expert or specialist in a specific field can thoroughly understand the
factual issues involved. Second, it may be necessary to employ an expert to prove or disprove
the essential elements of the case. Third, the heart of the litigation may be technical in nature,
such as the appropriateness of a corrective action technology, and counsel must enlist a second
expert as an advocate for its position.
With these reasons in mind, this course is designed to assist practicing attorneys and
technical staff develop an understanding of the process and methods for preparing and providing
expert assistance and testimony. This course provides background material that describes the law
regarding expert opinion and its admissibility as well as identifies the role of both attorney and
expert in this important practice. It also informs technical staff as to how preparation with legal
proceeds and why it is important.
3.1.1 Law Relating to Expert Witness Practice
The Federal Rules of Evidence, Rule 702,
defines the appropriate subject matters of expert
testimony to include all scientific, technical, or
other specialized knowledge. The rule permits a
witness to qualify as an expert by knowledge,
skill, experience, or education, and makes clear
that no formal schooling or training is necessary
as a threshold to the witness' ability to testify as
an expert. Under this rule, an expert may testify
as to matters about which the trier of fact has
insufficient personal knowledge to make the
inferences necessary to arrive at a decision on the
ultimate issues in dispute.
Federal Rule of Evidence, Rule 703; allows
an expert to testify like any other witness as to facts of which he or she has personal knowledge,
even if he or she was able to observe and assess the relevancy of those facts only because of his
or her skills and experience. An expert may also offer opinions to those facts about which the
jury itself has insufficient experience to form an intelligent conclusion.
Reasons for Expert Testimony
• Explain factual issues to the court.
• Prove essential elements of the case.
• Provide an advocate for the government's
position.
Federal Rules of Evidence
• Rule 702—A witness qualified as an expert
by knowledge, skill, experience, training, or
education may testify if scientific, technical,
or other specialized knowledge will assist
the trier of fact.
• Rule 703—The facts or data upon which the
expert opinions are based may be derived
from:
- First hand observation
- Presentation at trial
- Presentation of data outside the court and
other than by his or her own perception
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Expert testimony is advisory in nature. It is not necessary that the expert be absolutely
certain of the facts upon which an opinion is based. It is usually sufficient that the expert testify
that the particular result is within the range of reasonable probability according to generally
accepted scientific principles. It is important to remember, however, that the expert's testimony
may be excluded under the common law "opinion rule," if the court finds that the state of the art
in the field is such that even an expert could not express a reasonable opinion, or if the court
finds that sufficient facts have been introduced into evidence to form the basis for a reasonable
opinion at the required level of probability.
Generally, to be admissible at common law, an expert's opinion must be capable of adding
considerably to the jury's ability to resolve the issue in question. The subject matter must be one
in which the average trier of fact is incapable of reasonably drawing necessary inferences from
the facts introduced into evidence, and the particular witness must be qualified as an expert.
Once qualified, the expert witness may be limited to testifying only within the expert's expertise.
The expert witness may state opinions either from first-hand knowledge of the facts of the
occurrence which gave rise to the lawsuit, on facts presented at trial, through the testimony of
other witnesses, or based upon hypothetical questions which contain necessary facts on which to
form the basis of an opinion. Further, the expert may base opinions on otherwise inadmissible
hearsay information provided that such information is of the type "reasonably relied upon" by
experts in the particular field in forming inferences about the subject.
Factors to be considered when selecting an expert or arguing for or against the admissibility of
a particular piece of expert testimony are:
• Is the expert's knowledge or experience useful to the finder of fact in resolving the
problem?
• To what degree does an expert's particular qualifications allow formation of an intelligent
opinion on the disputed issue than an average trier of fact could make alone?
• Will the expert's opinion interfere with the jury's duty to decide the case from the facts
admitted into evidence?
• To what degree does the expert's opinion depend upon the ability to weigh the force and
significance of the evidence?
• How credible and how sufficient are the facts, data, and analysis relied upon by the expert
in formulating his opinion?
• What is the weight, in terms of appropriate probabilities rather than possibilities, of the
expert's opinion on the disputed issue?
/of
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• To what degree does the expert's opinion consist of a judgment based on undisputed
underlying facts?
• How sound is the expert's personal knowledge of the facts upon which the opinion is
based?
An expert witness may be any person who has the knowledge, training and or qualifications
necessary to aid the finder of fact. This may include Resource Conservation and Recovery Act
(RCRA) inspectors or technical staff, as well as independent experts. In selecting an expert, all
attributes must be assessed and consideration given to the opposition's perspective (e.g.,
expertise, objectivity).
3.1.2 Role of the Expert Witness
The role of an expert witness is to assist
counsel, the judge and the jury with understanding
those scientific or technical aspects of the case
that are beyond the experience of the average lay
person. Experts may do more than supply
opinions. They may also provide certain facts,
such as the results of special tests or experiments.
In addition, they may assist with case evaluation,
pre-trial discovery, and with settlement
negotiations. Consideration of which role your
experts may play will assist in making an informed decision to use any given expert at any given
time. Case development staff should be cognizant of issues that may need expert input,
particularly where an expert is needed to prove or provide evidence on a technical issue.
The opposing side is only entitled to the professional opinions of your expert. You should
make it clear to your experts what their role is and instruct them not to form or offer professional
opinions outside their area of expertise. Thus, you need not permit your expert hydrologist to
offer an opinion as to whether a site presents an "imminent and substantial endangerment," an
area which may involve the opinions of a toxicologist. However, if you use the interdisciplinary
approach discussed below, your expert hydrologist (or more likely an overview expert) may be
able to offer an opinion to the effect that based on what the toxicologist told him or her at the
meeting and based on his or her own work relating to contaminant transport to the site, a threat
to the environment is present.
3.2 EXPERT WITNESS PRACTICE—ATTORNEY
3.2.1 Pre-Trial Use of the Expert Witness
If you think you will need opinion testimony at any point in the case to help you explain
complex technical issues in an understandable manner, or to establish any point of proof, you
should retain the necessary experts at the outset of the case. An expert can be a valuable
member of your litigation team by assisting with the following:
//o
Role of Expert Witness
• Assist the court with understanding technical
issues
• Supply opinions
• Assist with evaluating the merits of the
government's case as well as the merits of
opposing parties' case
• Assist with pre-trial discovery
• Assist with settlement negotiation
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Preparing the Expert Witness
• Helping to decide whether the case has merit.
• Educating counsel about the technical details involved in a case by:
- Explaining the records
- Recommending journals, articles, or treatises for counsel's study
- Discussing strengths and weaknesses in the field.
• Formulating theories for recovery or defense and for anticipating theories likely to be
advanced by the opposing party.
• Assisting with discovery by:
- Formulating and answering interrogatories
- Identifying documents to be requested from the opposing party
- Evaluating information received from interrogatories and depositions of the opposing
parties or their expert witness.
• Performing tests, examinations and studies.
• Facilitating settlement by virtue of the expert's reputation and prestige.
If the expert is reasonably expected to be called as a witness at the trial, the witness must
be sufficiently qualified. The threshold test for qualifying as an expert is very low; but unless
a person is identified as an expert he or she may be precluded from offering any opinion
testimony at trial. Nearly all U.S. Environmental Protection Agency (EPA) technical employees
should be able to qualify as an expert in some field. Failing to designate such employees as
experts is a common error.
If the expert is likely to appear on the stand, the expert should show an appearance and
demeanor with which the judge and jury can identify, and an ability to speak about the technical
issues in the case in a way that is comprehensible to the lav person. In such cases, experts
should be selected with these factors in mind.
3.2.2 Pre-Trial Preparation of the Expert
The following general and specific considerations set the stage for the effective use of
expert testimony.
General Considerations
• Start early. When you are drafting the complaint, remember that the government will
have to prove the central allegations of the case. Both the attorneys and the technical
personnel should be thinking throughout the entire process about how the government will
prove its case under the rules of evidence. As the plaintiff you should constantly be
striving to simplify your case. Issues must be boiled down so that they appear to be no
more complex than an introductory college course.
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• Provide all technical information to all
of your experts, including all of the
information provided by the other side.
In very large cases you may have to rely
on summaries of sampling results.
However, the more removed from the
original data your experts are, the greater
opportunity for problems down the road.
You may want to generate a set of "core
documents," to be provided to all experts
retained by the government. The "core
documents" should contain all of the
documents generated by either side that
relate to the disputed issues in the case.
• Meet early and frequently with your experts. An interdisciplinary approach is strongly
recommended. This approach entails bringing all the experts in different fields (in-house
experts as well as outside consultants) together for a free ranging discussion of the issues
in the case, including the studies, data and arguments advanced by your adversaries.
Observing and participating in such a meeting helps you gauge the strength of your
witnesses and your case. Since many of your experts' opinions are based on information
and opinions provided by others, your case can be greatly strengthened since such
"personal communication" can be relied on by the expert and often convey much more
information than might be contained in a written report. Moreover, in such informal
exchanges, experts tend to be more willing to criticize (and thereby allow correction of)
work performed by their colleagues. This approach also allows you to better identify
areas of weakness in-the opponent's case and to develop rebuttal evidence if necessary.
Finally, by involving the experts in a portion of the planning and development of the
lawsuit, you may find that they are more willing to put in the long hours that are
inevitably required as trial approaches.
• Identify all of your testifying experts and obtain all documents written or reviewed
by them in the course of reviewing the matter at hand. Require frequent updates to
avoid the "crunch" that inevitably occurs.
• Develop an affirmative strategy for
dealing with privilege issues, including
preparation of a privilege log. This area
is very complex and cannot be addressed
in a meaningful way in just a few
sentences. However, you should keep in
mind that it is unlikely that you will be
able to appeal a discovery decision and
that the courts vary widely in their
handling of such issues. Accordingly, it is
recommended that you assume and advise the technical staff that you cannot guarantee
that any memos or reports written by them (even memos to you) will be protected from
Pre-trial Preparation of Expert
• Start preparing early
• Simplify your case to a college freshman
level
• Meet frequently
• Review technical information of all experts
• Develop a strategy to deal with privilege
issue
• Conduct necessary examination, tests, and
studies
• Prepare a written report of analyses and
findings
• Assist in framing discovery requests and
reviewing discovery requests
Courts Differ on Privilege Rulings
One court may rule that the government can
waive its deliberative (or governmental)
privilege by filing the lawsuit and order all
internal EPA memorandum to be turned over
to the other side. Another court may rule that
draft consent decrees exchanged by the parties
in confidential settlement discussions must be
turned over to third parties.
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disclosure. In doing so, however, you should emphasize that you still need their honest
opinions about the government's case and the opposition's case.
Specific Considerations
• Assist with Case Evaluation. Rely on your experts to evaluate the merits of the case
and to point out unavoidable inconsistencies or inconclusive evidence in a case. This is
particularly relevant for case development staff dealing with highly complex issues or
gaps in evidence. Such a review can apply both to the government's case and the
defendant's. The inconsistencies that are identified could affect your trial strategy, for
example, if the expert uncovers inconsistencies in the opposing expert's previous work
that directly contradicts what that expert is expected to maintain at trial. Your expert can
also provide assistance in preparing the cross examination of an expert witness at
deposition or trial by evaluating the opposing expert's work and identifying questionable
conclusions, omissions, or methods and suggest means of attacking them based upon
personal knowledge of the opposing expert's reputation.
• Conduct Examinations, Tests, Studies. By conducting necessary examinations, tests,
or studies, the expert witness can instruct counsel in the various technicalities of the case.
These tests, or studies should be conducted sufficiently in advance, and the expert should
be prepared and capable of explaining the results and relevance of each. The expert
should also have some opinion as to their validity and acceptance in the field. Again the
expert should also examine opponents' studies and tests so that counsel can frame cross-
examination accordingly.
• Prepare Reports. For the following reasons, it may be desirable for to have a written
report of the expert's analysis and findings:
- Counsel would have a formal report available as a ready reference source of the
substance of the testimony that the expert is prepared to give at trial
- The report provides a useful summary of all the experiments, tests, procedures and
professional analysis performed in the course of the expert formulating opinions on
disputed issues
- The report allows the expert to refer to his own report should a significant time elapse
between the time the research was conducted, conclusions were formulated, and the
date of the trial itself
- The report will serve as an aid in structuring the direct examination of your expert
witness, as well as prepare your witness for the cross examination.
Be aware that these reports may be
discoverable under the Federal Rules of
Civil Procedures (FRCP), Rule 26(b)(4)—
thereby giving opposing counsel a
framework within which to prepare an
effective cross-examination, and to
discover any deficiencies in your expert's
analysis and conclusions.
Federal Rules of Civil Procedures
Rule 26(b)(4)
Rule 26(b)(4) provides for discovery of any
matter, not privileged, which is relevant to the
subject matter involved in the pending action.
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• Assist with Discovery Response. Because of the expert's technical knowledge, your
expert should be able to assist you in framing a discovery request, by knowing what to
look and ask for. This may help you avoid wasting time and effort. In addition, by
reviewing opposing counsel's discovery requests, the expert may be able to identify what
aspects of the case or of his own work will likely be subjected to the greatest assault and
on what grounds.
• Assist with Settlement Negotiations. By evaluating the case, the expert may indirectly
influence your perception of the bargaining position, thus assisting with settlement
negotiations. As you identify the merits of the case, its projected outcome, and potential
benefits, you will feel more secure in your discussions with the opposing parties thereby
projecting a stronger case.
3.2.3 Deposition
If you have properly prepared your case and worked closely with your experts, you should
have little to fear and much to gain such as anticipating opposing counsel's litigation strategy,
from having a mutual exchange of experts depositions. Expert depositions are not required under
the Federal Rules of Civil Procedure. They are common practice throughout most of the country,
but some judges will not order that expert depositions be had. Accordingly, if you feel that
depositions would help your case, it is generally in your interest to secure an agreement of
counsel early in the case, that depositions will be exchanged, before opposing counsel gets to
think about it.
Preparing Your Expert for Deposition
• Timing of Deposition. (Be Prepared.)
Because experts (and attorneys) are more
diligent and creative as trial approaches, it
is very difficult to assure that all work
will be done and the experts will be ready
at the time of the deposition.
Notwithstanding the fact that an expert is
entitled to rely on information he or she
learns even in the courtroom just prior to his or her testimony and certainly should be
able to prepare rebuttal testimony even after completion of his or her direct testimony,
the purpose of discovery is to eliminate trial by ambush. At some point, well in advance
of any discovery cutoff, you should ascertain from your opponent and the court how these
competing interests will be balanced in your case. In many instances, if time permits, the
court will require that all work be completed well in advance of trial. In other instances
the court may permit expert depositions right up to and even after the start of trial. You
should do everything possible to ensure that your experts are fully prepared as early as
possible.
If you are fortunate enough to be prepared early, you may want to push for a mandatory
cutoff date for any new work by either, side's experts. In the more normal situation, you
should negotiate for completion of nearly all work prior to expert depositions, with
Preparing Your Expert for Deposition
• Be prepared
• Limit talk
• Listen to the question
• Ensure that your expert has heard the
question properly
• Provide your expert with all technical
material and ensure its review prior to
deposition
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prompt production of results and an opportunity to re-depose witnesses relating to any
work that is ongoing. You might be tempted to delay rebuttal work until the start of trial
in order to avoid tipping your hand. However, in doing so you run a substantial risk that
the testimony will be excluded if the court determines that you could readily have
foreseen the need to perform the work and that the surprise will prejudice your
opponents' ability to respond to your new work. In addition, with the current congestion
in the Federal Court system, you may find that your ability to put on rebuttal testimony
is severely limited.
• Limit your expert's response to the question that is asked. Probably the most
common mistake made by experts during depositions is that they talk too much. You
should advise your expert of this common tendency and remind him or her that the trial
is the place to fully explain the issues. You do not want your witness to be
uncooperative, but the witness need not go out of his or her way to ensure that opposing
counsel understand all of the work (and the limitations of the work) that has been
performed. Many times the question can be answered with a simple yes or no, rather
than a long exposition.
• Advise your expert to listen to the questions. The witness should be advised to listen
carefully to the question and answer only the question. The witness should also be
encouraged to pause (perhaps long enough to repeat the question in his or her mind)
before answering to reflect for one more moment on the "professional opinion" he or she
is about to render and to allow you more time to object if necessary. Moreover, the
witness should be encouraged to request frequent short breaks (not less than every half-
hour or 45 minutes) so that the witness can maintain his or her concentration during the
long deposition session. Most mistakes are made when witnesses are tired and do not
hear the question properly. Remember, pauses do not show up in a transcript, mistakes
do.
• Ensure that your expert has heard the question properly. The attorney's principal
objective is to ensure that the transcript accurately reflects the witness' views. Thus, if
you believe that the witness has not heard the question properly, you should correct the
matter immediately, rather than waiting to file an affidavit after your opponent has used
the transcript in his or her summary judgment motion. Counsel may question his or her
own witness at a deposition; however as a general rule, counsel should only question his
or her witness in a deposition to correct an error or ambiguity in the transcript (and only
when he or she knows how the witness will answer the question).
• Provide your witness with all technical material and ensure its review prior to
deposition. Familiarity with the technical literature of the case will provide your expert
with the background and knowledge of underlying disputed issues thus enabling a more
confident and authoritative demeanor.
Deposing and Examining the Defendant's Expert
At the deposition, your main objective is to find out exactly what the witness has done,
what he or she may do in the period between the deposition and the trial, and to understand fully
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every opinion the witness may have that has
anything to do with the issues in the case. This
includes ALL of the bad news.
• Be Prepared. Obtain a decent Expert
Witness Report pursuant to F.R.C.P. Rule
26(b)(4). These reports are usually drafted
to be of minimal utility, but at least they
generally tell you the area of expertise of
the witness and his or her general role in
the case.
Obtain all of the documents reviewed
or prepared by the witness in
connection with the case, as well as those documents that the witness will rely upon
in the course of his or her testimony.
To achieve this objective, an early case management order may help. You may jointly
agree to exclude communications with counsel, except for data and/or analyses
contained in such communications, but you should not be satisfied with receiving only
the materials the witness will rely on at trial, since presumably the witness will not be
relying on the least favorable information. A key tenet ought to be that all studies, etc.
prepared in this case will be exchanged. The courts will frequently not allow the
United States to withhold data because it is work product and we ordinarily do not
even make a claim for data. Accordingly, it is usually in our interest to make sure that
our opponents do not withhold damaging information under the "work product"
doctrine by forcing mutual disclosure of all data, analyses, etc. reviewed by the expert.
Receive information early.
You should receive the bulk of this information several weeks before depositions
commence so that you can go over it with your experts. Your experts should advise
you on what additional information you should obtain at deposition so that they can
fully understand the work reviewed or performed by your opponent's expert. They
should also be able to explain to you what the opposing expert's approach is and
suggest general lines of inquiry.
Obtain a recent curriculum vitae for the witness including a list of publications.
Copies of articles or studies not in journals or common circulation should also be
obtained. You can usually find some useful information by reviewing prior relevant
publications by experts.
Deposing and Examining
the Defendants Expert
• Be prepared by reviewing all reports and
literature that is likely to be prepared or
relied upon by the expert
• Know who. the expert is
• Have expert identify and produce all
information that he or she reviewed for the
case
• Understand the expert's "formula" and how
the expert arrived at his or her results
• Conduct a line-by-line review of documents
produced by the expert
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- Obtain any reports or studies by our experts in this case that relate to the witness'
subject area.
- Review all ot this information personally. From your review of the information, you
can develop an outline of general areas of inquiry and a list of admissions you think
you can obtain from the witness. In developing this list, keep in mind any summary
judgment motions you anticipate filing with an eye towards reducing the number of
"facts that are in genuine dispute."
• Inquire into the witness' background and prior work. An expert may have "fudged"
his or her resume in a way that undermines his or her credibility at trial, or, more likely,
the witness' expertise may. not be directly relevant to the issues in your case. Similarly,
an expert who only works for industry can be shown to have a bias that may undermine
his or her credibility. Where an expert has worked both for the government and industry,
you may find testimony from an earlier case that is useful in your case. You may also
achieve gains by forcing the expert to justify contradictions in his or her present views
from those expressed earlier, but as explained below, once you have figured out that there
is a contradiction, you may want to resist the temptation to fully "bore in" on the issue
at the deposition and save it for trial.
• Have the expert identify (and hopefully produce) everything he or she reviewed in
the course of his or her activities on your case. You should not be satisfied with the
production of "all materials relied upon" since the expert could then ignore contradictory
information without you knowing of his or her mental gymnastics. This inquiry should
be specific enough for you to determine whether opposing counsel has only furnished his
or her experts with the information that supports the theory that counsel is advocating.
If the experts have only been provided selective information several opportunities are
available depending on the specific circumstances, including providing the information
to the expert and reconvening the deposition (since it is fairly likely that once you bring
up the subject, the expert will review additional material before trial).
• Determine what algorithms are being
employed by the experts (yours and
theirs) and identify the information that
the expert must either know or assume
to derive a result. Once you have
determined the witness' "formula" you
should probe for the source and reliability
for each of the terms that make up the
formula. It is at this point that you can
usually determine where the experts are diverging and focus your efforts on buttressing
your support for the critical facts. "Working the formula" may involve a two phase
approach: examination and line-by-line review of the expert's documents.
Determine Where the Experts Diverge and
Find Support for the Critical Facts
For example, in hydrology the key factor
where the experts differ may be an assumption
about the rate of evaporation of groundwater,
while in risk assessment, it may be the
bioavailability of a compound.
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- Phase One—Examination
— "Working the formula" may involve a two-phase approach. Engage the opposing
expert in a free ranging discussion of his or her background, other investigations
the expert may have undertaken in similar cases, how the expert usually does his
or her work, what facts may be relevant generally to forming an opinion and how
changes in those facts may alter the predicted results. This examination should
include a description of the tools the expert uses, e.g. which groundwater model(s)
does the expert normally use. Make the expert teach you more than you ever
wanted to know about his or her field in general and this case in particular. Be
extremely inquisitive and not let something go past you that you don't understand.
— Ask the witness to express his or her views in all areas relating to the case—even
those outside of the scope of the witness testimony. Experts are not normally as
combative as their counsel and may be willing to concede a number of fundamental
facts that counsel would prefer to attempt to challenge. One of the chief benefits
of expert depositions is the transcript citations that thereafter are attached to
summary judgment motions, proposed stipulations and requests for admissions. At
worst, opposing counsel will severely limit the scope of opinions that the witness
may express at trial; your inquiry is not a concession that the person is an expert.
-- Inquire into the expert's view of the work done by your expert and your expert's
opinions. Do not be satisfied with general criticisms: ask the witness how he or.
she would correct the "mistakes" of your expert (the witness may be right). You
really do want to know the "bad news" as well as the "good news."
~ Inquire into precisely how the expert is using "environmental" jargon. When you
probe into the details, you often find that the difference between the experts is not
as large as it seems. In one case the opposing expert, who testified that the site did
not present an "imminent and substantial endangerment", did agree that there was
an ongoing release of hazardous chemicals that ought to be stopped as EPA was
proposing. In his view an "imminent and substantial endangerment" occurred only
in Bhophal-like emergencies.
— Focus on when the expert first formed his or her opinion, how certain the expert
is of the opinion and whether he or she believes a reasonable expert could come
to a contrary opinion.
- Phase Two—Line-By-Line Review of the Documents
-- A line-by-line review of the documents produced by the experts is extremely
tedious, but is unavoidable if our experts are to criticize or rely on the opponent's
work. You should inquire to clarify how the measurements were conducted, what
are the units that are reported, whether any of the data was ignored for any reason,
how the witness evaluated the data and how it supports (or undercuts) his or her
conclusions. Many experts consider data that contradicts their opinion to be
"anomalous."
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— Where assumptions were made by the expert, be sure to determine the witness'
support for the assumptions, his or her view as to the reasonable range of other
values that might be assumed and how changing the assumption affects the
outcome of the analysis. You may find that your expert's assumptions (and
answers) are within their expert's range of reasonable assumptions.
~ Question the expert on the precise language of his or her 26(b)(4) report. These
reports are usually drafted by counsel and the witness may not have even seen the
report. Thus, the report may only be what the attorney hoped the witness would
say at trial and the witness may not be willing to go nearly as far as his or her
counsel had assumed. If you focus the witness' attention on the report before you
obtain testimony oh the report, the witness can more easily tailor his or her
deposition testimony to the wishes of the client who retained him or her.
— If you discover a major weakness in you opponent's analysis, you have to decide
whether to confirm and clarify the weakness so that you can use it for summary
judgment or simply to make a mental note of it and not alert the witness that
you've figured him or her out. If you destroy an analysis too soon, you may find
at trial that the witness has performed and entirely new analysis that either corrects
the deficiency or attacks the problem from an entirely different direction. The key
factors are the extent to which you believe the weakness can be corrected, the
likelihood of a successful summary judgment motion and settlement prospects.
-- Establish whether the expert has any ongoing work or whether the expert
anticipates performing any additional work. Do not be satisfied with the old dodge
"that depends on what my counsel decides." You can inquire as to what work the
expert thinks should be done to strengthen his or her testimony, increase the
expert's certainty in his or her opinion, or resolve any issues raised by the
government.
3.2.4 Preparation of the Expert for Trial
Most people underestimate the amount of mechanical work that must be done to lay the
foundation for an expert's opinion. While, theoretically, the expert may rely on matters not in
evidence, a far more compelling case is made if the court is shown, in small incremental steps,
that the opinion follows naturally from the facts admitted into evidence in the case.
With this in mind, the witness should: have the ability, based on specialized knowledge,
to draw inferences from facts which the finder of fact would not be competent to draw; based
on knowledge of the facts, provide testimony that includes factual evidence as well as an expert
opinion; provide opinions based on examinations or tests conducted; provide an expert opinion
based on the facts as they are put into evidence at trial, with no personal knowledge; provide an
opinion on otherwise impermissible hearsay information, provided that such information is of the
type reasonably relied upon by experts in the particular field in forming inferences about the
subject, and; assist counsel in formulating an effective cross-examination of the opposing expert.
To effectively deliver all the above, the following techniques are proposed.
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• Teach the court. Unless the court
already has a background in the issues in
controversy, you should have your expert
teach the court the basics of the relevant
science. The presentation should be
gauged for a college freshman course and
only hit the highest points of the science,
but the witness should devote a significant
amount of time to this general
presentation. You want the court to trust your expert when it comes to the controversial
issues. Having your expert be the court's "tutor" on non-controversial issues starts that
process. Next, you want the court to understand the science well enough so that the judge
can "see" what your expert is doing and "see through" what your opponent is doing.
Opening with such general testimony will also help establish that your witness is an
expert in the field. How much of this testimony is done before tendering the witness for
voir dire is a judgment call based on the actions of your opponent and the reaction of the
court. Ordinarily, it is recommended to try to elicit most of this type of testimony before
proffering the witness as an expert in a particular field.
• Develop on outline of the testimony. Work with your witness to develop the outline of
testimony early on and revise it as the case develops. You do not want to find yourself
a week from trial not being able to prove a critical point because your expert can't offer
an opinion you assumed he or she could. It is often useful to have the witness develop
the first draft of the testimonial outline. While you need to be flexible and tailor your
examination based on what you hear from the Court during the examination, to the extent
you stay with the outline on direct examination, you avoid surprising your witness. If
you surprise your witness, your witness may surprise you.
• Prompt the witness, but do not lead. Direct testimony is really the witnesses' show.
You are there principally to prompt the witness into the different areas of testimony and
to handle the mechanics of introducing the evidence. You are not generally permitted to
ask leading questions of your own witness. Accordingly, your questions are usually very
general.
• Simplify whenever possible. Try to help the Court understand what the witness is trying
to say in very simple terms. The Court is much more likely to accept something it thinks
it understands, even if only in concept, than if the entire presentation goes right over its
head. "Does the defendants' 'pump and dump' program actually remove all of the
contamination from the groundwater?"
• Try to make it interesting. A short video or physical demonstration every once in a
while will help the Court remember what you are trying to prove and can often explain
the concept far more clearly than hours of testimony from the stand. You may wish to
videotape a portion of your expert's testimony to permit him or her to demonstrate
matters that are not easily shown in court.
Teach the Court
For example, your expert can explain how
groundwater modelling can be manipulated and
show that his results are based on conservative
real world data. Later, perhaps on cross-
examination, you will show the clever
manipulation by the defendants' expert.
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Such taped testimony has a number of
other significant advantages, including
enhancing the credibility of the witness
and diminishing your opponent's ability to
cross-examine the witness. Ordinarily,
you must furnish your opponent a copy of
the tape in advance if you wish to have it
introduced into evidence.
• Simplify and keep track of exhibits. Do
not underestimate the difficulty associated
with keeping track of large numbers of
exhibits and getting them introduced. Try
to keep things as simple as possible. Be
sure to have someone at counsel table
keeping track of your exhibits for you.
Trial—Examining the Opponent's Expert
The chances of an experienced expert
witness breaking down on the stand under your
withering cross examination are slim. It is more likely that an experienced witness will simply
use any unartful questions you ask as a way of repeating and reinforcing his or her testimony.
Try to pick out two or three areas in which you can be assured of modest success and perhaps
one or two higher risk/higher reward areas.
• Identify the areas where the witness agrees with your expert. You may wish to open
your cross examination by having the witness identify the areas where he or she agrees
with your expert. This avoids a total shutout, enhances your expert's credibility and
undercuts your opponent's efforts to confuse issues.
• Walk the witness through his or her analytical process. Assuming that you have
discovered his or her "formula" during deposition, now is the time to "work the formula"
by putting it up on a board and walking the witness through his or her analytical process.
As you take the witness through his or her assumptions, you will dwell on those guesses
for which the witness has neither hard data nor scientific expertise to guide him or her,
such as the amount of rainfall that will fall on the site over the next twenty years or the
bioavailability of a compound that has not been tested.
• Refer to specifics when taking on the opponent's expert. If you decide to attempt to
take on an opponent's expert on any major issue, make sure you have at hand all of the
documents you could possibly need to make your point. Remember, the witness will take
any path you leave open in order to avoid damaging his or her client and some of the
more experienced expert witnesses are very slippery. It is almost impossible to pin down
an expert without referring to specifics. If your questioning is general in nature, the
witness will almost invariably escape.
Prompt Witness but Don't Lead
Use questions such as, "Explain to the Court
how . . or "Have you formed an opinion
concerning . . . ?" Sometimes, however, you
must direct the witness' attention to a specific
area that he or she has forgotten or correct a
mistake that he or she has made. There are
ways of asking a very specific question without
leading, e.g., "Can you explain whether or not
. . ?" In addition, you can usually get away
with a prefatory remark before you ask your
question. "Now Dr. Smith, I would like to
direct your attention to your earlier statement
. . " or "Your honor, at this time I would like
to move away from the regulatory issues and
begin to address the health issues in this case."
If you and the witness simply are not
connecting, you can ask the court for
permission to lead the witness for a minute or
two "in the interests of time." Ordinarily, the
Court will have figured out what your problem
is and have mercy on you.
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• Be careful with a strong advocate for
the opponent. With an expert who is too
strong an advocate for the client's
litigation position (i.e., a con artist) you
may want to let him or her paint himself
or herself into a corner and later argue
that he or she is an extremist. Remember,
also, that if you "open the door" by asking the wrong question during cross examination,
the court may allow testimony in areas you thought you had foreclosed.
• Watch out for traps. It is important that you do not ask a question that you do not
know the answer to, but this does not mean that you need to explore all unknown areas
at the deposition. During the deposition you might get a sense that if you posed a certain
questions you might get a helpful response of a witness. If you ask it during the
deposition and the response is truly damaging, opposing counsel will undoubtedly work
with the witness to "fix" the response before trial. Thus, once you have gotten a sense
of what the witness would probably say, if asked, you should consider moving on at the
deposition to avoid tipping your hand. At trial you are taking some risks, but that is the
nature of cross examination. To keep your risk of loss at a minimum, you may have to
engage in a little belated discovery during the trial in order to predict what the answer
will be. Take your time and creep up on the area of uncertainty so you can abandon the
line of inquiry before it becomes too obvious to your adversary and the Court that you
have landed in a trap. Do not move in for the kill until you are sure you have it.
• When in doubt, punt. Use your expert to rebut their expert rather than trying to take
him or her apart yourself and leaving the Court with the perception that you failed.
• Don't go after losing issues. A stipulation that Geraghty and Miller are groundwater
experts is better than a losing voir dire effort. Indeed you might stand up and stipulate
at the outset that these persons are experts in a particular field to a) make points with the
judge, b) throw off the other side's timing, and c) prevent them from impressing the judge
with their "rock star's" credentials. Similarly, do not highlight the weaknesses of your
case by attempting to knock down one of their strong points (and failing).
• When in doubt sit down and be quiet. Usually you can pick up the line of inquiry again
on redirect or recross, after you have had an opportunity to talk it over with your expert.
3.2.5 Counsel's Summary Guide to Expert Testimony
• Be prepared.
• Try to anticipate opposing counsel's litigation strategy. Discovery and the pre-hearing
exchange offer the most likely sources of information.
• Attempt to learn how the Presiding Officer/judge has ruled on similar fact patterns and
issues.
Be careful of the strong advocate
for the client
You may simply want to leave the witness
alone and use rebuttal testimony by one of
your experts to make the point.
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• Does the Presiding Officer prefer to strictly follow the Federal Rules of Civil Procedure
and Federal Rules of Evidence, rather than the more informal provisions found in the
Administrative Procedures Act?
• Provide all technical information to all of your experts as soon as possible.
• Obtain all information reviewed by testifying experts.
• Understand the technical information that has some bearing on the action.
• Prepare your expert witnesses well in advance of any discussions with respondent.
- Don't let your expert talk beyond answering the specific question asked.
- Make sure the witness listens to the questions.
- Counsel the witness to craft an answer carefully prior to answering a question.
- Explain to the witness the test for qualifying as an expert.
- Explain to the witness the disadvantages of overstating your case.
• Laying foundations for the expert's opinion requires a great deal of time and care.
• Introducing exhibits requires foundations.
• Use open-ended questions.
• Allow your expert witness to explain his or her answer.
• Volunteer case weaknesses.
• If your expert does not know an answer don't panic, rephrase the question.
• When testifying, use few notes.
• Carefully use gestures.
• Pace yourself and the witness.
• Cross examination should be brief.
• Before asking a question on cross examination, consider the following:
- Has the witness hurt your case?
- Is the witness important?
- Is the witness credible?
- If opposing counsel's witness gave testimony that won't hurt your case, then don't
reopen.
- What do you expect form the cross examination?
- Weigh the risks of cross examining the witness.
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• Lead the witness during cross examination.
• If you don't know the answer, don't ask unless you really need that piece of the puzzle.
• Avoid letting the witness explain an answer on cross examination.
• During cross examination, don't let the witness repeat testimony they gave during direct.
• On cross examination make it appear as if you and the witness are not in an adversarial
mode. Don't argue.
• Avoid unnecessary questions on cross examination.
• Lay a proper foundation prior to questioning an expert's report.
• Be careful when trying to attack a witness as biased.
• Audio visual aids, such as charts, graphs, photographs can be useful tools.
• Evaluate whether you will require a translator.
• When making an objection make sure it is to protect or enhance the evidence you have
presented. Objecting for the sake of objecting may annoy the judge.
3.3 EXPERT WITNESS PRACTICE—EXPERT
3.3.1 Your Role as an Expert
This section describes the various roles, you as an expert, may be expected to fill as a case
proceeds through litigation. You may be needed for various purposes, e.g., assistance in
discovery, technical advice to parties and their counsel, examinations, studies, and
experimentation, and as an expert witness at the trial. Generally, counsel would not enlist your
services if was not anticipated that the case may ultimately proceed to a trial' on the merits and
that you will be called to provide opinion testimony on one or more of the specialized issues in
the case. Keep in mind that you are considered a consultant and advisor to counsel, but all
decisions as to litigation strategy and trial tactics will remain with counsel.
If you are put on the witness stand, your role is to ultimately persuade the trier of fact,
usually a judge, of your impartiality to both parties and to the issues in the case. Opposing
counsel will question in full detail about any relationship you have, socially, professionally, or
financially with any of the parties involved in the lawsuit. Your professional career and
background may also be subjected to intense scrutiny, and you may be questioned at length in
cross examination. It is therefore imperative, that before you agree to provide expert assistance
in any manner, you reveal to counsel, any association, or experiences you may have had that
might be used by opposing counsel to discredit you.
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3.3.2 Pre-Trial Assistance
As an expert, the scope of work you receive
from counsel must be broad enough to allow you
to properly form your opinions. For in-house
experts, your management must reassign lower
priority projects or otherwise ensure that you have
sufficient time to do the job properly. Budgets
are tight and there are many competing demands
for your time. However, there is no room in a
hotly contested lawsuit for hurriedly thought out
and/or poorly executed technical work. Work
with your lead counsel to develop a list of
projects to be done, a time estimate and priority
for each project and a schedule for completion of
those projects. The lead counsel, or his or her
designee, can help to ensure that you are provided
adequate resources to do the job properly.
• Understand the litigation schedule and
what you will be expected to do during each phase of the lawsuit:
- Document Requests
- Interrogatories
- Request for Admissions
- Fact Witness Depositions
- Expert Witness Reports (Rule 26(b)(4) reports)
- Expert Depositions
- Discovery Cut-off date
- Dispositive Motions
- Pretrial Order
- Trial
- Post Trial Activities.
Recognize that there will be periods of time when you will have to put other business
aside and devote all of your attention to the case. In most cases these periods of intense
activity usually occur:
- Just prior to and during expert discovery
- During settlement negotiations
- About 6 weeks before trial
- During trial.
The setting of these dates is to a degree beyond the control of your counsel and they
ordinarily will be modified several times during the course of the litigation. However,
there will come a time when the established dates become firmer. The best way to
Steps in Providing Pretrial Assistance
to Counsel
• Understand the litigation schedule
• Prioritize case work over other business
• Review all relevant work (Colleagues and
experts retained by the other side)
• Understand the case your attorneys are
trying to make
• Understand your role as well as the other
expert's role and how you all affect the case
• Identify areas of agreement and
disagreement within the team
• List each key fact in your area of expertise
• Develop lists of facts that you need your
attorney to explore to fill in data gaps
• Develop proof of all key issues
• Develop a comprehensive presentation of
your information
• Document your work
• Conduct a thorough search for documents
you intend to rely on or use
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budget your time is to check with counsel regularly on key litigation dates and to advise
counsel early of any extended periods when you will be unavailable.
• Review all of the relevant work to date. All relevant work includes the work performed
by your colleagues on the government's trial team and by the experts retained by the
opposing side. Be sure to identify to your counsel any work by either side that is of
particular concern to you for any reason.
• Understand the case. Understand what the attorneys are trying to do and make sure that
your counsel understands the technical aspects of the case, including the limitations
inherent in the science. One of the best ways to ensure that this exchange of information
takes place is an early meeting of all members of the litigation team with follow-up
meetings every 6 months or so.
• Understand each expert's role in the litigation team and how the various experts are
expected to interrelate. Be sure to identify early any additional expertise that is needed
to put on the government's case.
• Identify areas of agreement and disagreement within the team. Identify to counsel
the areas of agreement and disagreement within the government's litigation team and with
the other side's experts. Where our experts disagree among themselves, try to isolate the
source of the disagreement and determine whether it is important in the overall scheme
of the case. If it is important, try to develop testing or analysis to resolve the issue.
• Develop a list to emphasize strong points and minimize weaknesses. List each key
fact in your area of expertise, your support for your position with respect to that fact and
the opposition's support for its position. With this list as guidance your attorney will
attempt to develop a litigation strategy that emphasizes our strong points and minimizes
our weaknesses. This list should help to isolate the key areas of contention and provide
a focus for future testing and analysis. It will also be helpful for settlement purposes.
• Develop lists of facts you need your attorney to explore to fill in data gaps. Develop
lists of facts or issues which the other side (or its experts) should concede and a list of
facts and issues which you would like your attorney to explore in discovery to fill in gaps
in your own data base.
• Develop proof of all key issues. Develop "proof' for all key issues in your case area
and a list of the exhibits counsel should have admitted into evidence either before or
during your testimony. There are cases where the issue comes down to a simple
difference of opinion among experts. However, these cases are rare. Since the
government usually has the burden of proving most issues, your counsel will not be
satisfied by letting a case go to the court for decision based on a "toss of the coin" as to
which party's expert is more impressive. We have the best chance of carrying our burden
of proof if we have assembled a chain of documentary evidence in the nature of "building
blocks" that rationally lead to the conclusion we wish the Court to adopt. Similarly, we
can undercut our opponent's case if we can show that their experts' key assumptions are
unsupported or (even better) contradicted by the facts of the case.
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• Develop a comprehensive presentation of your information. Develop a presentation
of your information that explains the applicable tenets of the underlying science,
establishes the relevant facts as building blocks and then moves from those facts, by way
of very small steps, to the ultimate conclusion. Where complex concepts are involved,
try to develop simple explanations and/or physical demonstrations to assist the Court.
Your counsel will also welcome your suggestions concerning in-court demonstrations,
graphics and video tapes that will help present the most persuasive case to the court.
• Document your work as you go along. The court is interested in providing fairness to
the litigants and has developed procedures to avoid unfair surprise at the trial. One of
those procedures is the early release to the other side of anything you might want to rely
on at a trial. In order to minimize the inevitable crush that occurs just prior to expert
depositions and to avoid prejudice to our case if something cannot be found at the last
minute, it is recommended that you keep a litigation file and document your work as you
go along. If you look up a fact in a reference work, simply photocopy the frontispiece
of the text and the relevant page, staple them together and drop them in your litigation
file. Similarly, if you perform an analysis on your computer that you may wish to discuss
at trial, print it and place a copy in your litigation file of materials to be turned over to
the other side.
• Conduct a thorough document search. Pay particular attention to our obligation to
produce to our opponents a copy of all materials relied upon or reviewed by you. Make
sure your first search for such documents is thorough.
3.3.3 Deposition
The purpose of a deposition is distinctly different from the trial. It is not normally the
occasion where you will undertake to affirmatively set out everything you know about the case.
Rather, the purpose of the deposition is to provide the other side a fair opportunity to discover
what knowledge the expert possesses and the professional opinions that have been formed with
respect to the case.
Opposing counsel will have several goals.
These include: 1) finding out what work you
have done, 2) discovering your opinions,
3) undercutting the government's case, and
4,) limiting your effectiveness at the trial. While
you should cooperate with counsel in
accomplishing the first two of these objectives
you need not provide any assistance to opposing counsel in the latter two areas. To do all this
you need to understand the process and follow a few simple guidelines.
• Answer all questions put to you thoughtfully and truthfully. The United States is a
regular litigant in the Federal District Courts where nearly all of our cases are tried to the
judge alone, rather than to a jury. For this reason, the long-term success of our
environmental enforcement program depends, in large measure, upon establishing and
maintaining our credibility with the federal judiciary. Moreover, nothing can be more
Goals of Opposing Counsel
• Find out what work you have done
• Discover your opinions
• Undercut the government's case
• Limit your effectiveness at trial
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embarrassing and disruptive than having to respond to contradictory statements at trial.
Thus, in addition to the obvious ethical issues, it is in your personal as well as the
Government's interests for you to be scrupulously honest in your testimony.
• Do not volunteer information beyond the scope of the question. When you do so,
several things happen, almost all of them are bad. First, you educate opposing counsel
experts. They may then be able to find a way, unanticipated by you, to turn your
statement against you. Second, If the fact or opinion you gratuitously offer is particularly
damaging to their case they can then shift their theories or conduct rebuttal work to
diminish its impact at trial. Third, there is always the possibility that the information you
offer, while damaging to your opponents, is not as bad as your opponents had feared.
Fear of the unknown (otherwise known as "litigation risk") is one of the motivating
factors that drive litigants toward settlement.
Note, however, that occasionally overboard exposure of the government's case does have
some benefits. Sometimes where we are less than certain that a government expert's
opinion can withstand attack, a useful strategy may well be to volunteer the opinion, even
without prompting, and then question the opposing expert about the opinion. This "notice
and comment" approach hopefully would enable us to correct our work before trial.
Conversely, if we are convinced that our opponents cannot rebut our work and want to
prod our opponent into considering settlement, government counsel may suggest letting
them have it with both guns.
• Do not evade questions in order to
"hide the ball." Such a tactic is contrary
to your professional interest as well as the
government's interest in that it threatens
our credibility if at trial you are able to
answer questions that you avoided in the
deposition. Moreover, there is the very
real possibility that your testimony will be
excluded if you have unfairly "ducked" a
question. Rather, the advice not to
volunteer information is intended to
remind you that there are varying degrees
of technical competency among attorneys and even excellent attorneys can miss important
points when they depose you. A poor examination of you in a deposition is a tactical
advantage to the government.
• Be alert to defense counsel's other goals—minimizing the area of your expertise and
undermining your credibility. Think about these matters and discuss them with your
counsel in advance of the deposition. Remember, you need not be the expert in a field
to offer opinion testimony, neither need you be limited to areas within your formal
training. For instance, an on-scene coordinator may have the right to offer professional
opinion in any area within the scope of his employment, including risk assessment, risk
management, hydrology, capping technologies, cost estimating, etc. Understand the legal
test for allowing expert opinion and don't allow yourself to be painted with too broad or
Do Not Evade Question
Use your common sense to balance the
competing interests and risks. Answer fairly
the questions fairly put to you, but do not
lightly throw away tactical advantage that may
be available to the government because you
believe the other side's lawyer is asking the
wrong questions or because you want to get
your story out. You will get your opportunity
to say your piece in settlement discussion
and/or at trial.
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too narrow a brush. Discuss with lead counsel in advance of your deposition the nature
of the professional opinions you feel competent to offer so that you are not unduly
restricted at trial and are not drawn into offering opinions outside of your area of
expertise.
• Do not offer an opinion during your
deposition unless you have had
sufficient opportunity to think about it.
While some answers are obvious and
should be answered on the spot, remember
that you are being asked for your
professional opinion, not just for casual
comment and that a lot may be riding on
your response. Do not allow opposing
counsel to rush you into forming an
opinion on the spot.
• When expressing your opinion, remember that you are essentially dictating it to the
court reporter, and it is only the written word that will survive. A nod of the head
or other physical gesture may or not be recorded and, if it is recorded, may be
misinterpreted. In order to avoid being quoted out of context be sure to include the
appropriate qualifiers each time you state an opinion.
• Be on your guard at all times. The informal format of a deposition can be deceiving.
Remember that everything you say on or off the record will be used against you. Listen
carefully to each question, pause to be sure you understand the question and to allow your
counsel to object to the question and listen to any objection. Be especially cautious if
opposing counsel attempts to paraphrase an earlier statement of yours—he or she may be
trying to change your earlier statement slightly. You may ask the court reporter to read
back your earlier statement.
• Be sure you heard the question. You may ask the court reporter to read back any
question you are not sure you fully understand.
• Answer only the question put to you. If the question asked does not make sense to you
simply say so to opposing counsel. Do not answer the question that should have been
asked in place of the question that you were asked. In the written transcript it will appear
that you, not opposing counsel, made an error.
•You are in control of the deposition. You control the pace of the deposition by the
pace of your responses (it is hard for your opponent to mount a withering* rapid-fire
assault if you are pausing for fire or ten seconds to consider your answers). Most
mistakes are made when the witness is tired. You should ask for a short break anytime
that you feel you are getting tired or losing your ability to concentrate. A three-minute
break every 45 minutes will help keep you fresh.
Think about your opinions
before expressing them
A good rule of thumb is not to offer a
professional opinion in a deposition unless you
would be prepared at that moment to offer the
opinion at trial or put it in a memorandum to
senior agency officials. If true, it is entirely
appropriate to respond "I haven't formed an
opinion on " or "I would have to think about
that for a while before I could form an
opinion."
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• Unless there is a real need to consult on
a particular question before you answer
it, the better practice is to consult with
your attorney when there is no pending
question. You may consult with your
attorney at any time even when there is a pending question. Simply state that you wish
to consult with your attorney and do so.
• If the question would require you to divulge information that you think may be
privileged or confidential, discuss it with your attorney before answering the
question. For agency employees this would ordinarily include internal deliberative
matters and the opinion of non-testifying experts. Before the deposition go over with
your counsel which materials are being treated as privileged, so that you do not cause a
waiver of any privilege claim by inadvertent disclosure.
• Ask your attorney whether you should bring any materials, such as newly generated
studies, additional material reviewed, etc., to the deposition.
• If your attorney requests or instructs you not to answer a question, please do so.
The purpose of the request is to ensure that the United States' rights can be preserved
while we seek a ruling on a disputed record.
• Promptly correct mistakes. Usually an error in responding to a question at a deposition
is of no major consequence if it is promptly corrected. If, at anytime you become
uncomfortable about any answer you gave at the deposition, advise your attorney, he or
she can correct the matter.
During the deposition it is a fairly simple matter to simply correct the matter on the
record "As I thought about it over lunch, it appeared,to me that I made a mistake this
morning...." Even later, a simple letter from counsel may serve to put things right. Early
disclosure and correction is the best way to avoid undergoing a grueling cross-
examination in which a simple mistake on your part is portrayed as a gross incompetence,
perjury or worse.
Assisting at the Deposition of the Opponent's
Expert
The primary goal of the deposition is to
make sure that you and your counsel understand
all of the work performed by your adversary.
This includes the opponent's theory of the case,
his or her method of analysis, his or her
assumptions and exactly what is contained in
every study or analysis—including the units associated with the reported results.
• Review your opponent's work. Once you have reviewed your opponent's work, make
a list of everything you need to have clarified. At times, there will be typographical
Remain Alert
Take Frequent Breaks
Assisting at the Deposition
of the Opponent's Expert
• Review opponents work
• Simplify the case
• Buttress your own testimony
• Identify inaccuracies and areas of
deficiencies
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errors etc.; make sure your counsel takes the witness through the details of each analysis
or data set.
• Try to simplify the case. It is to the government's advantage to simplify the case as
much as possible. You should develop a list of areas where you think your opponent will
agree with you. Ordinarily this will include a number of fairly basic concepts which, to
you, aJe so obvious that you don't normally even think about them. For example, you
may think that a concession that "GC/MS is the accepted technique for analyzing PCBs"
is fairly trivial. However, if we were forced to establish that principle at trial, we would
have to expend considerable resources, and we would have allowed defendants to
complicate the case and divert the court from the real issues.
• Buttress your own testimony. Many times you need to make an assumption which is
neither controversial nor critical, but for which you have no proof. If you alert him or
her to these areas, your counsel can simply ask your opponent what his best estimate of
the particular factor is or whether the number you have selected is within the range of
reasonable assumptions for that parameter.
Similarly, by asking your opponent detailed questions about your work and conclusions,
your counsel can help you to correct errors or identify areas that need additional support
in advance of trial. Mistakes caught and corrected before trial are generally of no
particular significance at trial. Let your counsel know which areas of your work are most
likely to draw fire from your opposition.
• Identify inaccuracies and areas of deficiency. During the deposition, you can often
detect what your counsel cannot—when an expert is trying to duck a question by
responding with a lot of baloney. At a break you can suggest lines of questioning or even
write out a question verbatim for your counsel to ask.
Where you see areas of deficiency in your opponents work, point them out to counsel and
develop lines of questioning to "nail down" the error or omission, hopefully without
alerting your opponent to the fact that your have figured out where his or her work is
weakest.
3.3.4 Trial
Direct Testimony
This is your chance to tell your story.
During your direct examination you are on center
stage. Your attorney is only there to set the stage
and to move things along. He or she will ask
open ended "softball" questions that serve as an
outline to move you from topic to topic and to reinforce certain points.
Understand the logistics involved in exchanging multiple copies of exhibits, blow ups of
photos, extra copies of videos, etc. and start your preparation well in advance.
Direct Testimony
• Tell your story
• Respect the judge
• Answer questions in common English
• Use your normal teaching style
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Your objective is to persuade the judge of the accuracy of your testimony. Remember that
the judge has spent a career listening to witnesses attempting to convince him or her of a
particular point and probably has a very finely tuned listening antenna. "Tell the truth, the whole
truth, and nothing but the truth." Direct your testimony to the judge, whom you should refer to
as "Your Honor", and be courteous. By following a few basic rules your testimony will be seen
as credible and truthful.
• Respect the judge. If the judge gets the sense that you do not respect his or her
authority, he or she is less likely to give much weight to your opinion. Be respectful,
even if you disagree with what the judge is doing.
However, you should not modify your testimony simply to please the court. You can
disagree with the judge without arguing with him or her.
• Answer the question in common English. Without patronizing the court, use simple
examples and common language to explain your point. Instead of, or along with, "this
substance has discrete lead phases within a silicon oxide matrix", one could try "It's like
a chocolate ship cookie your honor, where the chocolate chips are made of lead and the
cookie is made of glass. These chips are currently in the cookie but can fall out if the
cookie crumbles."
• Use your normal teaching style. Many experts are more comfortable explaining
something standing up with an easel or pointer than sitting in a witness chair. You will
probably be more convincing to the court if you adopt a style most comfortable to you.
In bench trials, most judges do not mind if you move about from exhibit to exhibit at an
easel rather than staying in the witness chair. However, you or preferably your attorney
must ask the court's permission before you step down from the witness chair for any
reason.
Cross-Examination
No competent attorney engages in cross-examination without a plan. You should assume
that every question put to you is for a purpose. Again, his or her purpose may be to limit your
testimony, to undermine your credibility with the court, or to get you to agree with him or her
on some point.
• Be cautious and careful. Much like your deposition, during cross-examination you
should be guided by a balanced, cautious approach. You do not wish to be perceived as
extremely partisan and uncooperative, but you must be cautious and careful. If you don't
know the answer to a question, say so. If you are not comfortable answering a
hypothetical question that you can reasonably answer say so.
• Never argue with the court and do not constantly spar with opposing counsel. His
or her comments and questions are not evidence that should be considered by the court.
However, they are part of your opponent's efforts to persuade the court. Accordingly, it
is entirely appropriate for you to occasionally "unload" on a question. "Yes, but as you
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know, both the government's testing and
the defendants' testing have shown
dangerously high levels of toxic materials
at the site."
• Opposing counsel will be asking leading
questions, in other words, questions that
can be answered "yes" or "no." If a
"yes or "no" is the accurate response,
leave it at that. Where a "yes" or "no"
answer would be misleading, you should
say so. Occasionally, you may answer
"yes" or "no" with the appropriate
explanation (i.e., yes, but...").
• Be prepared if opposing counsel "opens
the door." At times, in cross-
examination opposing counsel can make
the mistake of "opening the door" by
asking you questions relating to an area in
which you were foreclosed from testifying
on direct. Discuss this area in advance with your counsel, because if it occurs, and you
recognize it, you can use one of your "sporadic long responses" to give your entire
testimony in that area.
Redirect
Redirect is generally for damage control purposes only—listen very carefully to the
questions on redirect and assume that your counsel is either trying to get you to recognize an
error that you made (either in direct or cross-examination) or trying to get you to explain in
greater detail an answer you gave in your cross examination to negate a point made by your
opponent.
3.3.5 Witness' Guide to Expert Testimony
The following suggestions will aid the expert witness in giving testimony:
• Be prepared.
• Make sure that counsel explains why he or she has asked you to testify.
• Know the definition of an expert. Rule 702 defines an expert as any person who
possesses specialized knowledge through knowledge, skill, experience, training, or
education. Most likely you will be asked questions concerning the following:
- Qualifications
- Name, etc.
Be Careful on Cross Examination
Opposing counsel may ask, "If the material
were non-toxic, wouldn't you agree that the
site would not present an endangerment?"
This question most likely was designed to
show that you are much more of an advocate
for the agency's position than an expert the
court should trust. Most likely a "no"
answer, or a strong hedge will get you into
trouble. Yet, there may be dangers
associated with a simple "yes" answer (issues
of corrosivity, flammability, etc.) Assuming
that our case is based on the toxicity of the
material, the best answer is probably one that
sounds like you are agreeing with your
opponent, but which contains enough
qualifying language to protect yourself and
our case..." Yes, I would agree with you on
that, all other factors being equal and leaving
aside for the moment issues relating to
corrosivity, flammability, and so on."
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- Business or occupation
- Education
- Training
- Licenses
- Professional association
- Other background, teaching, consulting, writing
- Expert at other trials
- Experience in specialty.
• Review internal documents and refresh your memory prior to discovery and prior to trial.
• Make sure that you understand what is going to happen during pre-trial and through the
appeals process.
• Make sure counsel understands the technical aspects of the case.
• Make sure that counsel is aware of the relative strengths and weaknesses in the testimony
you will provide.
• You are telling a story to the trier of fact, usually the judge.
• When you testify, face the judge. He or she is the person that you have to persuade.
• Answer all questions honestly. If the question requires a yes or no answer. Answer "yes"
or no.
• Be on guard at all times, familiarity may breed disaster.
• Don't volunteer information.
• Phrase your answers in plain English. Technical jargon may confuse people and
ultimately adversely impact the case, slow the process, and/or make it appear as if you
have something to hide.
• Don't exaggerate.
• Avoid saying "I think" or I believe." Stay away from phrases like "To the best of my
recollection" and absolutes like "always" and "never." If an answer requires some
discussion about policy or practices, state the practice and indicate what you did on that
occasion. Counsel who requires absolutes for answers is trying to trick you. The trier
of fact will most likely be aware of this. Be wary of questions that begin "wouldn't you
agree that..." If a question has two negatives say you don't understand the question. This
can also be a trick question.
• If your answer is incorrect, correct the error immediately.
• Stop when the judge interrupts you.
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RCRA Practitioners Enforcement Workshop
Preparing the Expert Witness
• Don't ask the judge for advice.
• Discuss the nature and scope of your professional opinions. You should feel comfortable
with the questions you answer.
• If you don't have an answer, say you "have not formed an opinion," or "I need to think
about the question."
/£T
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RCRA Practitioners Enforcement Workshop
Preparing the Expert Witness
EXERCISE
(Read the following fact pattern and discuss)
In 1982 you prepared a report that was considered privileged attorney work product. You identified specific
contaminants and traced their pathways from industrial sources into the groundwater. In 1987 you were deposed,
and today you were notified by counsel that you will be needed at trial in two weeks. Counsel asks that you bring
any relevant written reports (including your 1982 report) or notes that you. can gather, and meet with him to discuss
the case the night before you are scheduled to testify. You agree to this, knowing that the day before your scheduled
meeting you have a critical deadline to meet for another case that you are involved in. You have been warned by
your supervisor that the deadline is firm.
Since you last worked on this case, you went back to school and obtained your Ph.D. in Hydrogeology. While
at school you met the leading authorities in the field, who considered you a maverick in some of your theories. The
defendant's hydrogeologist is a former close friend from graduate school. You haven't seen him for two years.
As the trial date approaches, you finally locate and quickly read the report you prepared in 1982 but are unable
to find a copy of your deposition. You seem to recall that during the deposition you were uncomfortable about one
of your conclusions, but can't seem to recall specifically what that conclusion may have been. You only remember
that you decided against notifying counsel of your uncertainly after the deposition. Instead, you decided that
whatever the issue was, it could be rectified should the case ever go to trial.
The day of the trial, you drag yourself into court having only spent one hour the night before with counsel
because your 1V4 year old son was rushed to the hospital emergency room after a failed attempt to climb safely out
of his crib. By the time you got home and settled into bed it was 3 a.m.
Notorious for having little patience when you have little sleep, you are not tolerant of the judge's constant
interruptions in your testimony for what seem to you to be inconsequential questions. Also, in an attempt to assist
your counsel who is new to the agency, and who is unfamiliar with the technical aspects of your report, you decide
to disregard his questions and tell the judge what you think he needs to know to understand the relevant science.
Similarly, on cross examination, you decide to elaborate on each of your answers so as to appear competent.
Satisfied that opposing counsel made no significant points, you step down from the witness stand and go home.
Instructor Notes:
1. Don't count on attorney work product as privileged—report probably is discoverable.
2. Discuss which notes should be brought to the deposition.
3. Counsel didn't give adequate preparation time with trial two weeks away.
4. Counsel should have scheduled meeting with expert earlier than the night before.
5. Discuss—qualifications, advance degree, opinion changes, bias, friends with opponent, theory rather
radical, as possible impeachment of credibility.
6. Not prepared—only have report—quickly read—did not review deposition.
7. In danger of having your credibility impeached, be accused of gross incompetency or perjury for failure
to correct an error at deposition.
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RCRA Practitioners Enforcement Workshop
Preparing the Expert Witness
8. Didn't discuss case in detail with counsel the night before, does not know the government's case, other
expert opinions, other technical documents, etc.
9. Tired and in danger of not paying attention.
10. Disrespectful of judge.
11. Doesn't listen to counsel on direct examination.
12. Not cautious or careful on cross-examination—Does not recognize inherent dangers in responding the way
he has.
/31
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September 1995
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v>
ft
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
4. IDENTIFYING SOLID AND HAZARDOUS WASTES
&EPA
tie
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Module 4 Objectives
• Become familiar with waste identification
fundamentals
• Discuss important issues affecting waste
identification
• Examine recent developments affecting this
area of RCRA regulation
Notes:
1
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Determining Whether the Material
Is A Solid Waste
A
• Key term: "discarded"
• No statutory definition of term "discarded"
• Regulatory definition of discarded—(§ 261.2)
abandoned, recycled, or inherently waste-like
- Abandoned - Disposed of, burned or incinerated,
or accumulated, stored, or treated before or in
lieu of being disposed of, burned, or incinerated
- Inherently waste-like - Certain dioxin F wastes
and secondary materials fed to a halogen acid
furnace
y
Notes:
2
September 1995
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RCJtA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
EPA Authority Over
Hazardous Waste Recycling
• Three court cases address "discard" and
confirm that EPA has certain authority over
hazardous wastes that are recycled:
- AMC v. EPA (AMC I)
- API v. EPA
- AMC v. EPA (AMC II).
Notes:
3
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Solid Waste: Statutory Jurisdiction
Enforcement
Action
Solid
Waste
Hazardous
Waste
§3007
V
V
§3013
V
V
§7003
Notes:
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Recycled Materials (§ 261.2—Table 1)
Use Constituting
Disposal
Ener gy
Recovery Fuel
Reclamation
Speculatively
Accumulated
Spent
Materials
V
V
V
V
Sludges
(listed)
V
V
V
V
Sludges
V
V
V
Byproducts
(listed)
V
V
V
V
Byproducts
V
V
V
Commercial
Chemicii
Products
V
V
Scrap
Metal
V
V
V
V
Notes:
5
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Exclusions From Definition of
Solid Waste (§ 261.4)
Domestic sewage
Industrial wastewater discharges subject to
NPDES
Irrigation return flows
Nuclear materials or byproducts, as defined
by AEA
Pulping liquids reclaimed in a pulping liquid
recovery furnace and reused in pulping
Spent sulfuric acid used to produce virgin
sulfuric acid
Closed-loop recycling
Notes:
6
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
r
\
Exclusions From Deflnition of
Solid Waste (§ 261.4) (Continued)
• Materials subject to insitu mining
• Certain wood preserving wastes
• Specified wastes recycled to coke ovens, tar
recovery, or production of coal tar
• NWW splash condenser dross from
treatment of K061 in HTMR units
Notes:
7
September 1995 tf-$~
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RCRA Practitioners Enforcement Workshop Identifying Solid and Hazardous Wastes
Sham Recycling
• Indications of sham recycling include:
- Secondary material is ineffective or only
marginally effective for the claimed use
- Secondary material is used in excess of that
necessary
- Secondary material is not as effective as raw
material it replaces
- There are no records (e.g., financial) regarding
the recycling transaction
- Secondary material is not handled like a valuable
commodity.
Notes:
—* TT
8
September 1995
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RCJRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Burden of Proof (§ 261.2(f))
Is there a market for my materials?
Did I meet the terms of exclusion?
Do I possess onsite recycling equipment?
IaarghH
RESPONDENT
Notes:
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September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Hazardous Waste—Statutory Definition
• § 1004(5) definition:
"...solid waste[s] which because of its quantity,
concentration, or physical, chemical or
infectious characteristics may...cause,...an
increase in mortality or an increase in serious
irreversible, or incapacitating reversible,
illness or...pose a substantial...hazard to
human health or the environment when
improperly...managed. "
Notes:
10
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Regulatory Definition
• Characteristic wastes:
- corrosivity (§ 261.22)
- ignitabiiity (§ 261.21)
— reactivity (§ 261.23)
— toxicity (§ 261.24)
Notes:
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Regulatory Definition (Continued)
• Listed wastes:
- F wastes (§ 261.31-non-specific sources)
- K wastes (§ 261.32—industry-specific sources)
- P wastes (§ 261.33(e)—acutely hazardous
commercial chemical products)
- U Wastes (§ 261.33(0—hazardous commercial
chemical products)
Notes:
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Mixture Rule § 261.3(a)(2)(H)
*Not listed for characteristic
Notes:
13
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Derived-From Rule § 2613(c)(2)(H)
Listed
Hazardous
Waste
Characteristic
Hazardous
Waste
Notes:
Treatment
Storage
Disposal
Treatment
Storage
Disposal
*If characteristic
14
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Challenges to Derived-From and Mixture Rules
Shell Oil v. EPA (1991)-Vacated derived-
front and mixture rules (12/6/91).
EPA published an interim final rule
reinstating rules (3/3/92); sunset provision
April 28, 1993.
1992 Appropriations Bill-*-NulIified sunset
provision and established October 1, 1994,
deadline for revisions.
10/94—Citizen suits from generators and
TSDF groups to enforce October 1, 1994,
deadline. No final consent decree yet; will
impose deadlines.
Notes:
15
September 1995
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RCRA Practitioners Enforcement Workshop Identifying Solid and Hazardous Wastes
Reclaimed Products (§ 2613(c)(2))
• Materials that are reclaimed from a solid
waste and are beneficially used are not solid
wastes, unless burned for energy recovery or
used in a manner constituting disposal.
• Waste material becomes more product-like
than waste-like.
Notes:
16
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Contained-in Policy (OSWER Dir. 9481.00-6)
• The regulated universe of hazardous waste
includes contaminated media, such as soil or
ground water, that contain hazardous waste.
• These "contained-in" wastes must be
managed under full Subtitle C standards.
• The policy is codified for debris at §
261.3(f)(2).
• Regions determine on a case-by-case basis
when the media no longer "contains"
hazardous waste.
Notes:
17
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
When Does a Material Become a Hazardous
Waste? (§ 2613(b))
1. When a solid waste first meets the listing
description
2. When a listed hazardous waste is first
added to a solid waste
3. When a waste exhibits any hazardous
waste characteristic
4. When a hazardous waste exits the
production, storage, or transportation
vessel or unit in which it was generated
(e.g., product storage tank generates
waste sludge)
Notes:
18
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
When Does a Material Cease to Be a Hazardous
Waste? (§ 261.3(d))
• When it no longer exhibits a characteristic
• If listed, it has gone through the delisting
process
Notes:
19
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
r
a
Solid Wastes Excluded From Definition of
Hazardous Waste (§ 261.4)
• Household waste
• Agricultural wastes returned to the soil as
fertilizers
• Certain wastes that fail the TC, including
wood that fails only due to arsenic, and
petroleum-contaminated media and debris
• Specific wastes from the extraction,
beneficiation, and processing of ores and
minerals
• Cement kiln dust
V
Notes:
20
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Solid Wastes Excluded From Definition of
Hazardous Waste (§ 261.4)(Continued)
• Fly ash, bottom ash, slag waste, and flue gas
emission control waste, generated primarily
from the combustion of coal or other fossil
fuels
• Certain hazardous waste samples being sent
to laboratories for hazardous waste
determinations or treatability studies
• Other industry-specific wastes added via
rulemakings
Notes:
21
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Municipal Waste Combustor Ash
• May 2, 1994: Supreme Court overturns
EPA's MWC policy
• February 3, 1995: EPA statutory
interpretation—ash is subject to Subtitle C
when it exits the combustion building
• Allows facility operators to mix bottom and
fly ash within building before sampling.
Notes:
22
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Conditionally Exempt Small Quantity Generators
(§ 261.5)
• If CESQGs generate less than 100 kilograms
of hazardous waste per month, they are
conditionally exempt from Subtitle C
regulation for that month.
• Wastes are still classified as hazardous waste,
but are not subject to regulation as a
hazardous waste.
• Solid waste and hazardous waste exclusions
are important in determining how to "count"
wastes towards the total.
Notes:
23
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Recyclable Materials (§ 261.6)
• Hazardous wastes that are recycled
• Recyclable materials are subject to
generator, transporter, TSD requirements
prior to entering recycling unit
• If no storage prior to recycling, facility
subject only to notification and manifest
requirements
• Recycling units are not regulated, except for
boilers and industrial furnaces.
Notes:
24
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Recyclable Materials (§ 261.6) (Continued)
Certain hazardous wastes recycled in certain
ways are regulated under Part 266.
Extent of regulation varies depending on
material and recycling practice.
Part 266 addresses use constituting disposal,
precious metals recovery, spent lead-acid
batteries, and boilers and industrial furnaces.
Under § 261.6, certain recyclable materials
are not subject to regulation under Subtitle
C.
Notes:
25
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Applicable Oil Management Standards
Type Of Used Oil
Applicable STDs
Recycled oil, exhibits
characteristics
Part 279
Mixed with listed
hazardous waste
Parts 260 - 268
Mixed with a
characterized waste or
waste listed based on
characteristic(s)
Parts 260 - 268
(Unless mixture no
longer exhibits
characteristic(s). In this
case, regulated under
Part 279.)
Notes:
26
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Residues in Empty Containers (§ 261.7)
• Hazardous waste remaining in "empty"
container or inner liner removed from an
empty container not subject to regulation
• "Empty" container
- All wastes removed AND
- Limits on amount of residue
- Special requirements for acute hazardous waste
Notes:
27
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Universal Wastes (Part 273)
• Many facilities generate small quantities of
hazardous waste.
• Rule addresses hazardous waste batteries,
unused, recalled pesticides, and mercury-
containing thermostats—does not include
fluorescent lights.
• Standards for universal waste handlers (e.g.,
generators, and facilities that store or
accumulate wastes) based on two size
categories—accumulate less/more than 5,000
kilograms.
Notes:
28
September 1995
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WilsonJones. Quick Reference Index System
© 1991 Wilson Jones Company
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
4. IDENTIFYING SOLID AND HAZARDOUS WASTES
Background Materials
vyEPA
-------
INSTRUCTOR NOTES
RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
4. IDENTIFYING SOLID AND HAZARDOUS WASTES
Time: 1.5 to 2 hours
Objectives:
¦ Discuss waste identification and related rules.
Emphases:
¦ Enhance understanding of:
- When a waste is a solid waste
- When a waste is a hazardous waste
- Exemptions and exceptions
- Hazardous waste recycling
- Mixture and derived-from rules
- Small quantity generators and exempt small quantity generators
- Empty containers
- Universal wastes
Helpful Hint:
¦ Case studies are interspersed throughout the text with answers to the exercises and provided
in Appendix A without answers.
Appendix:
Appendix A—Solid and Hazardous Waste Exercises
Bibliography:
Lowrance, Sylvia. Memorandum from S. Lowrance, Director OSW, to Hazardous Waste
Management Division Directors, Regions I-X, entitled Food Recycling, April 26, 1989.
Lowrance, Sylvia. Memorandum from S. Lowrance, Director OSW, to Jeff Zelikson, entitled
Status of Contaminated Groundwater and Limitations on Disposal and Reuse,
January 24, 1989.
Compendium Document 9441.1984(33) and (34), 9441.1985(15), 9441.1987(04), 9444.1987( 18).
U.S. Environmental Protection Agency, 1993 (March). RCRA Practitioners Enforcement
Workshop: Course Materials.
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
4. IDENTIFYING SOLID AND HAZARDOUS WASTES
The identification of a material as a solid waste is the fundamental first step in the Resource
Conservation and Recovery Act (RCRA) cradle to grave regulatory system. After a material is
determined to be a solid waste, it then may be classified as a hazardous waste. If a material is
not a "solid waste," it cannot be a "hazardous waste." This module presents the regulatory
framework for the definition of solid waste and the definition of hazardous waste. Exemptions
from each definition, including those involving certain types of recycling, are discussed. In
addition, case studies are presented at the end of each section.
4.1 SOLID WASTE
4.1.1 Statutory Jurisdiction and Case Law
The U.S. Environmental Protection Agency's (EPA) statutory jurisdiction over a material
as provided in the RCRA definition of solid waste hinges on whether the material can be
considered to be "discarded." The definition provided in Section 1004(27) is "...any garbage,
refuse, sludge from a waste treatment plant, water supply treatment plant, or air pollution control
facility and other discarded material including solid, liquid, semisolid, or contained gaseous
material resulting from industrial, commercial, mining, and agricultural operations, and from
community activities...." There is no statutory definition of "discarded"; 40 CFR 261.2 contains
a regulatory definition. Case law has served to establish some interpretations and boundaries of
the term. For purposes of the "imminent and substantial endangerment" enforcement authority
provided to EPA under Section 7003, only the statutory definition of solid waste is relevant. For
purposes of enforcement authority under Sections 3007 and 3013, the Agency only needs to have
a reason to believe that the material is both a solid and a hazardous waste as defined in the
statute. See the language in Section 261.1 (b)(2).
Three decisions by the D.C. Circuit Court address what constitutes "discard," at least in a
recycling context. These decisions established that EPA has broad, albeit not unlimited,
discretion to regulate recycling under RCRA. These decisions essentially establish that for
statutory purposes a material can be a solid waste if it is "part of the waste disposal problem."
The following list highlights these cases:
• American Mining Congress v. EPA (AMC I), 824 F.2d 1177 (D.C. Cir. 1987)—The
American Mining Congress (AMC) petitioned the U.S. Court of Appeals for the District
of Columbia for review of EPA's 1985 rule, which, AMC asserted, claimed authority for
the Agency to regulate secondary materials reused within an ongoing production process.
The court held that EPA had overextended its authority by regulating in-process
secondary materials, because materials designed for recycling in an ongoing continuous
production process were not discarded. The decision specifically restricted EPA's ability
to classify certain in-process streams in the petroleum refining and primary smelting
industries as solid wastes (therefore barring their regulation as hazardous wastes).
However, the decision did not affect the Agency's authority to regulate other recycling
activities that closely resemble waste management.
4-1
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
• American Petroleum Institute v. EPA, 906 F.2d 729 (D.C. Cir. 1990)—The D.C.
Circuit Court of Appeals narrowed its earlier decision regarding in-process recycling.
At issue was a challenge to the portion of the Agency's 1988 First Third Land Disposal
Restrictions (LDR) rule, which, in accordance with the "indigenous principle and the
AMC I decision," exempted from LDR regulations electric arc furnace dust from steel
production (K061) when the waste was to be reprocessed in the furnace that used it as
a feedstock in a zinc recovery operation.
In this case, the court granted petitioners a remand of the rule after finding that the
hazardous wastes were "indisputably discarded" before reentering the furnace for zinc
recovery. The decision further held that EPA could regulate K061 as a solid waste even
after the materials reached the reclamation facility.
• American Mining Congress v. EPA (AMC II), 907 F.2d 1179 (D.C. Cir. 1990)—AMC
challenged a 1988 rule promulgated by EPA that listed six wastes from primary metal
smelting and mineral processing as hazardous wastes. On the issue pertinent to this
discussion, the court ruled in favor of EPA, stating that copper, lead, and zinc materials
were properly regulated by EPA as solid wastes in light of the statutory definition under
Section 1004 (27) and the decision in AMC I. The copper, lead, and zinc materials meet
the definition of solid waste because they are managed in surface impoundments (and,
thus, becomes part of the waste management problems) even though industry frequently
recycles the materials back to the smelter at a later point. The court found that EPA had
reasonably determined that materials placed in surface impoundments, where they are
capable of posing a threat to human health and the environment, are discarded and,
therefore, are solid wastes.
4.1.2 Regulatory Jurisdiction
A regulatory definition of "discarded" was promulgated on January 4, 1985 (40 CFR 261.2).
A material is discarded if it is "abandoned," "recycled" or designated as "inherently waste-like."
A material is "abandoned" if it is disposed of, burned or incinerated, or accumulated, stored, or
treated (but not recycled) before or in lieu of being abandoned by being disposed of, burned, or
incinerated. Only certain dioxin-containing F wastes and secondary materials fed to a halogen
acid furnace have been designated inherently waste-like.
"Recycled" materials are regulated under certain circumstances. The regulatory status of
materials being recycled is determined by looking at 1) the type of secondary material it is and
2) how that material is being handled. The theory behind the structure of the regulations is based
on distinguishing between "production-like" activities (e.g., smelting of raw ore, which EPA does
not have the jurisdiction to regulate) and "waste treatment-like" activities (e.g., incineration,
which EPA has the jurisdiction to regulate). Secondary materials are regulated under Subtitle
C if they meet the definition of solid waste and are hazardous.
4-2
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes-
4.1.3 Categories of Secondary Materials
The regulations describe five categories or types of secondary materials:
• Spent material—A material that has been used and as a result of contamination can no
longer serve the purpose for which it was produced without further processing (e.g.,
spent solvent that has picked up so much contamination that it must be redistilled before
it can be used as a solvent again). (261.1(c)(1))
• Sludge—Any solid, semi-solid, or liquid waste generated from a municipal, commercial,
or industrial wastewater treatment plant, water supply treatment plant, or air pollution
control facility (e.g., bag house dust, wastewater treatment sludge) exclusive of the
treated effluent from a wastewater treatment plant. (261.1(c)(2))
• Byproduct—A material that is not one of the primary products of a production process
and is not solely or separately produced by the production process (e.g., distillation
column bottoms). (261.1(c)(3))
• Scrap metal—Bits and pieces of metal parts (e.g., bars, turnings, rods, sheets, wire) or
metal pieces that may be combined with bolts or soldering (e.g., radiators, scrap
automobiles, railroad box cars) and that when worn can be recycled. The following are
not scrap metal: residues from smelting or refining, liquid wastes containing metals,
liquid metal waste or metal-containing waste with a significant liquid component (e.g.,
lead acid batteries). (261.1(c)(6))
• Commercial chemical products—Unused commercial chemical products listed in
Section 261.33; any off-specification commercial chemical product or manufacturing
chemical intermediate that if not off-specification would be listed; residue remaining in
a container that has held the above; and residue or soil from cleanup of a spill of one
of the above. Such products only include chemical substances manufactured or
formulated for commercial or manufacturing use, that consist of the commercially pure
grade of the chemical, any technical grades of the chemical that are produced or
marketed, and all formulations in which the chemical is the sole active ingredient.
(261.33).
4.1.4 Categories of Handling or Recycling Practices
Secondary materials are solid wastes when recycled in four ways:
• Used in a manner constituting disposal—Applied to the land (e.g., dust suppression)
or used to produce a product that is placed on the land
• Burned for energy recovery, used to produce fuels, or contained in fuels—Note:
materials burned for both energy recovery and material recovery are considered to be
solid wastes burned for energy recovery. As a general matter, burning of low energy
hazardous wastes as alleged fuels is not considered to be burning for legitimate energy
recovery.
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
• Reclaimed—Processed to recover a usable product or component, or regenerated
• Accumulated speculatively—Stored with less than 75 percent being recycled within 1
calendar year.
4.1.5 Exclusions from the Definition of Solid Waste
Table 1 in 40 CFR 262.2 lists materials that are not solid wastes:
• Characteristic byproducts or sludges being reclaimed
• Commercial chemical products being reclaimed or speculatively accumulated.
In addition, the regulations at 40 CFR 262.2(e) contain several other exclusions from the
definition of solid waste including materials:
• Used or reused as an ingredient in an industrial process to make a product
• Used or reused as effective substitutes for commercial products, provided they have not
been reclaimed
• Returned to the original process from which they are generated without first being
reclaimed (must be used as a substitute for raw material feedstock).
These three exclusions will not apply, however, if the material is used in a manner constituting
disposal, burned for energy recovery, speculatively accumulated, or is inherently waste-like.
In addition, 40 CFR Section 261.4 contains a set of specific exclusions from the definition
of solid waste, including the following:
• Domestic sewage
• Industrial wastewater discharges that are point source discharges subject to Clean Water
Act regulations
• Irrigation return flows
• Nuclear materials or byproducts, as defined by the Atomic Energy Act of 1954
• Pulping liquors reclaimed in a pulping liquor recovery furnace and reused in the pulping
process (unless speculatively accumulated)
• Spent sulfuric acid used to produce a virgin sulfuric acid (unless speculatively
accumulated)
• Secondary materials that are reclaimed and returned to the production process from
which they are generated (i.e., closed-loop recycling)
/7*
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
• Spent wood-preserving solutions that have been reclaimed and are reused for their
original intended purpose
• Wastewaters from the wood preserving process that have been reclaimed and are reused
to treat wood
• EPA hazardous wastes K060, K087, K141-K145, K147 and K148, and any wastes from
the coke byproducts process that exhibit the toxicity characteristic, when these materials
are recycled to coke ovens, to the tar recovery process as a feedstock to produce coal
tar, or mixed with coal tar prior to sole or refining (provided no land disposal from
generation to the point of recycling)
• Nonwastewater splash condenser dross residue from the treatment of K061 in high
temperature metals recovery units provided the material is shipped in drums and not land
disposed before recovery.
Closed-loop recycling requires that the material being reclaimed to be returned to the original
production process from which it was generated, only tank storage is used, the entire process
through reclamation is closed (i.e., no or little chance for releases), and the reclamation does not
involve combustion.
4.1.6 Sham Recycling
Persons claiming an exemption from the definition of solid waste on the basis of recycling
must be able to demonstrate that their recycling practice is legitimate. Indications of
"illegitimate" or "sham" recycling are:
• Where a secondary material is ineffective or only marginally effective for the claimed
use
• When a secondary material is used in excess of the amount necessary
• Where the secondary material is not as effective as the raw material it is replacing
• Absence of records (such as financial) regarding the recycling transaction
• Secondary material is not handled in a manner consistent with its use as a valuable raw
material.
The January 4, 1985, Federal Register (50 FR 638) contains language on sham recycling. In
addition, a memorandum from Sylvia Lowrance to Hazardous Waste Management Division
Directors, Regions I-X, dated April 26, 1989, and entitled F006 Recycling also contains valuable
information on the topic. Both the Boiler and Industrial Furnace rule, 56 FR 7143 (February 21,
1991), and the March 16, 1983, Federal Register (enforcement guidance addressing burning
hazardous waste a fuel) discuss sham recycling.
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4.1.7 Burden of Proof With Regard to Recycling Claims
Respondents in actions to enforce RCRA Subtitle C who raise a claim that a certain
material is not a solid waste, or is conditionally exempt from regulation (Section 261.5 for certain
small quantity generators), have the burden of demonstrating that there is a known market or
disposition for the materials and that the material meets the terms of the exclusion or exemption
(40 CFR 261.2(f)). The respondent must provide appropriate documentation to demonstrate that
the material is not a solid waste or is conditionally exempt. Owners/operators who claim that
they are recycling must show that they have the necessary equipment to do so.
Case Study - Beacon Chemical Company
Beacon Chemical Company, located in Staten Island, is a formulator of specialty chemicals. The wastewater
from reaction tank cleaning contains minimal amounts of reaction residues. Some of the chemicals used in
the reaction are listed as commercial chemical products in 40 CFR 261.33. The wastewater is discharged to
an offsite publicly owned treatment works (POTW) via the city sewer line.
Q: Is the wastewater a solid waste?
A: The wastewaters are discarded, but they are exempt from being considered solid waste because
they are mixed with domestic sewage prior to discharge into the POTW (see 40 CFR
261.4(a)(1)(H)). The exclusion applies at the point the wastewater is mixed with domestic
sewage. Thus, if the wastewater were stored in an equalization basin prior to discharge to the
POTW, the wastewater in the basin would be a solid waste and, if it were a hazardous waste,
the equalization basin would be a hazardous waste management unit.
Case Study - Kamakaze Kemical Company
Kamakaze Kemical Company purchases spent pickle liquor from ABC Steel. Kamakaze uses the spent
pickle liquor as a raw material in its chemical manufacturing process where it serves as a reactant. The
manufacturing process is proprietary. The spent pickle liquor is stored in tanks prior to use.
Q: Is the spent pickle liquor a solid waste?
A: The spent pickle liquor is not a solid waste. Under 40 CFR 261.2(e)(l)(i), materials are not
solid'wastes when they are recycled by being used or reused as ingredients in an industrial
process to make a product, provided that the materials are neither being reclaimed nor
speculatively accumulated (provided that it is a legitimate raw material).
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Case Study - XYZ Corporation
The XYZ Corporation produces metal parts using a chrome electroplating process. No cyanides are used
during production. The process generates a wastewater treatment sludge that has a very high chrome content
that would be hazardous for chrome under the TC (D007). The sludge is pumped into 55-gallon containers
and placed in a container storage area onsite. During the last 2 years, about 500 gallons of the sludge have
been added to the container storage area every 6 months. The owner of XYZ is planning to ship the sludge
to a recycler that operates a chrome recovery process. However, no shipments of sludge have been made to
the recycler within the last 2 years. XYZ asserts that the sludge will be shipped to the recycler in the next
year. The owner also claims that the sludge is not a solid waste under the RCRA regulations and, therefore,
cannot be a hazardous waste. Thus, he believes that no storage permit is required for the container storage
areas because he is not storing a hazardous waste.
Q: Is the waste a solid waste?
A: The waste is a solid waste. It is a listed sludge (F006) being reclaimed and, thus, is a solid
waste. If the sludge had been characteristic only, it would be a solid waste due to speculative
accumulation because the electroplater has not sent 75 percent or more of the sludge for
reclamation during a calendar year.
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Case Study - Metals-R-Us
'Metals-R-Us engages in a manufacturing process that results in a baghouse dust and a wastewater treatment
plant sludge. Both wastes exhibit the characteristic of toxicity for lead. The baghouse dust is stored in a
covered waste pile, while the treatment plant sludge is stored in an open waste pile with perimeter curbing.
Effective January 1, 1986, Metals-R-Us entered into a contract agreement with Marvin's Metals Recovery
(MMR), Inc. to provide both of these materials to MMR in return for $2/ton, with MMR paying all shipping
costs. MMR operates a lead recovery process in a nearby city.
During a recent facility inspection at Metals-R-Us, records were reviewed and the following facts established:
1. During calendar year 1986, there were 10 shipments of baghouse dust to MMR, with a total weight
of 165 tons.
2. There were two shipments of waste treatment plant sludge during calendar year 1986—one of 2.5
tons and another of 4.3 tons.
3. There was no baghouse dust in storage on January 1, 1986, and an estimated 190 tons of dust were
generated during the year. In addition, there were an estimated 140 tons of treatment plant sludge
at the start of 1986.
Upon questioning, the plant engineer explained that, although the treatment plant sludge has sufficient lead
content for MMR's reclamation process, the moisture content interferes with the process. They have been
holding the sludge in the waste pile in hopes that it will dry sufficiently. The two 1986 shipments were sent
for pilot test purposes.
Q: Is either material a solid waste?
A: The baghouse dust is not a solid waste. Sludges exhibiting a characteristic of hazardous waste
are not solid waste when reclaimed. No speculative accumulation has occurred because more
than 75 percent of the dusts were reclaimed during the calendar year.
The treatment plant sludge is a solid waste. It is also a sludge exhibiting the characteristic of
toxicity. Because it is accumulated speculatively rather than being reclaimed, however, it does
not meet the provisions of 40 CFR 261.2(c)(3).
Case Study - Electric Arc Furnace Dust
Electric arc furnace baghouse dust (K061) containing high levels of lead, among other components, is sent to
a cement kiln as an ingredient for cement in place of iron ore. The K061 contains lead in concentrations
several orders of magnitude higher than the levels found in the iron ore. Prior to insertion into the cement
kiln, the K061 is mixed with mill scale (a nonhazardous solid waste) to make the iron content more even.
The cement processor receives a fee from the K061 generators for taking the waste.
Q: Is the baghouse dust sent to the cement kiln a solid waste?
A: The K061 generator may argue that the material is not a solid waste because it is being used
as an ingredient in an industrial process to make a product or that it is an effective substitute
for a commercial product under RCRA Section 261.2 (e). Because the lead concentration is so
high in the K061, however, it must be mixed with mill scale before it can be used in the
process. Essentially, the K061 is not an effective substitute for iron ore. In addition, the fact
that the K06I generator must pay the cement kiln operator to take the K061 is another
indication that the K061 is more waste-like than commodity-like. The K061 is classified as a
solid and a hazardous waste.
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4.2 HAZARDOUS WASTE
4.2.1 Statutory Definition
RCRA Section 1004(5) defines a hazardous waste as:
"A solid waste, or combination of solid wastes, which because of its quantity,
concentration, or physical, chemical or infectious characteristics may (A) cause,
or significantly contribute to an increase in mortality or an increase in serious
irreversible, or incapacitating reversible, illness or (B) pose a substantial present
or potential hazard to human health or the environment when improperly treated,
stored, transported, or disposed of, or otherwise managed."
4.2.2 Regulatory Definitions
A solid waste is classified as a hazardous waste if:
• The solid waste exhibits one or more of the characteristics of hazardous waste described
in Section 261.21-24 (i.e., corrosivity, ignitability, reactivity, and toxicity) or
• The solid waste is specifically listed in Section 261.31 ("F" wastes from non-specific
sources), 261.32 ("K" wastes from specific sources), and 261.33 ("P" and "U" wastes,
which are discarded commercial chemical products).
F Listed Solvents
For a spent chemical to meet the listing criteria, the chemical must have been used for its
solvent properties (i.e., to dissolve or mobilize other constituents). It may also meet the listing
criteria where it is a spent solvent mixture, provided the listed chemicals constitute 10 percent
or more of any mixture or blend prior to use. For example, a mixture of 50 gallons of solvents
will meet the listing criteria if it contains more than 5 gallons of F001, F002, F004, or F005.
Mixtures containing F003 are only hazardous when comprising only F003 (i.e., no other listed
solvents are in the mixture) or when they also contain 10 percent or more of non-F003 listed
solvents. General examples of solvent use covered by the listings are degreasers and cleaners,
diluents, extractants, and reaction and synthesis media. Chemicals that are used as reactants in
a chemical reaction are not considered to be F-listed wastes. (See the December 31, 1985,
Federal Register for a more detailed discussion of spent solvent mixtures.)
P and U Listed Wastes
"P" and "U" listings cover 1) only unused commercial chemical products (the most
common materials covered are off-specification products) and 2) only those products that are
generically identified using the name of a single listed constituent (i.e., sole active ingredient).
Therefore, a discarded, unused mixture containing both toluene and benzene would not meet the
listing; neither solvent acts as the sole active ingredient.
Mixture Rule
In addition to these two methods of hazardous waste classification, the RCRA regulations
provide other ways for materials to be included in the regulated hazardous waste universe. The
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"mixture rule" at Section 261.3(a)(2)(iii) and (iv) holds that if a hazardous waste is mixed with
a solid waste* the resulting mixture is a hazardous waste unless:
• It is a mixture of a solid waste and a characteristic waste and the resultant mixture no
longer exhibits a characteristic of hazardous waste;
• It is a mixture of a solid waste and a listed hazardous waste that was listed solely
because it exhibits a characteristic, and the mixture no longer exhibits any characteristic
of hazardous waste; or
• The mixture consists of wastewater, the discharge of which is subject to either Section
402 or 307 (b) of the Clean Water Act and any of the listed wastes described in Section
261.3(a)(iv)(A)-(B).
The intent of the mixture rule is to remove the incentive to dilute hazardous wastes with
solid waste or create mixtures that do not fit the listing descriptions in order to avoid regulation.
In addition, by keeping solid and hazardous waste streams separate, a smaller quantity of
materials will be subject to regulation and that will require treatment in a hazardous waste
facility.
Derived-From Rule
The "derived-from" rule (40 CFR 261.3(c)(2)) provides that any solid waste generated from
the treatment, storage, or disposal of a hazardous waste, including any sludge, spill residue, ash,
emission control dust, or leachate (but not including precipitation run-off) is a hazardous waste.
In other words, treatment residues from a listed waste retain that listing code. If, however, the
derived-from solid waste does not exhibit a characteristic and is not derived from or does not
contain a listed hazardous waste, it ceases to be a hazardous waste, according to Section 261.3(d).
Therefore, treatment residues from a characteristic waste are not classified as characteristic
hazardous waste if the treatment was successful in eliminating the characteristic.
Materials that are reclaimed from solid wastes and that are beneficially used are not solid
wastes and, thus, are not hazardous waste, unless they are burned for energy recovery or used
in a manner constituting disposal. This means, for example, that a reclaimed solvent will not be
classified as a hazardous waste; the material essentially is returned to product status and no
longer regulated as a solid waste.
4.2.3 Contained-In Policy
EPA interprets its regulatory definition of hazardous waste to include contaminated media,
such as soil or ground water, that contain hazardous waste. These "contained-in" wastes must
be managed as if they were hazardous wastes, subject to all treatment, storage, and disposal
requirements under RCRA Subtitle C, until they no longer exhibit a characteristic, no longer
contain a hazardous waste, or are delisted. Regions determine when the media no longer
"contain" hazardous waste on a case-by-case basis. A characteristic contaminated medium is
considered not to contain the characteristic hazardous waste when it ceases to exhibit the
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Status of Mixture and Derived-From Rules
The derived-from and mixture rules were challenged by numerous industries in a lawsuit filed by Shell Oil Company (Shell Oil
v. EPA, 950 F.2d 741 (D.C. Cir. 1991).). On December 6, 1991, the D.C. Circuit Court ruled that EPA's 1978 proposed nile did not
adequately provide notice of the derived-from and mixture rules and vacated the rules, remanding them to the Agency. At the invitation
of the court, EPA published an interim final role on March 3, 1992, which simultaneously removed and reissued the two rules on an
interim basis. This action was done under Section 553(b)(3)(B) of the Administrative Procedures Act. The reissued provisions included
a sunset provision that provided that the mixture and derived-from rules would remain in effect only until April 28, 1993.
EPA published a proposal containing several options for revising the two rules on May 20, 1992 (the initial proposed rule on
concentration-based exemption criteria for exiting the RCRA universe). The short time frame imposed by the sunset provision and the
technical issues in the May 20, 1992, proposed rule caused sufficient controversy to prompt the Congress to include several provisions
addressing the derived-from and mixture rule in EPA's 1992 appropriations bill. Congress nullified the sunset provision by declaring
that EPA could not promulgate any revisions to the rules before October 1, 1993, and by providing that the reinstated regulations could
not be terminated or withdrawn until new revisions took effect. Congress also established'a deadline of October 1, 1994, for the
promulgation of modifications to the mixture and derived-from rules. This deadline is enforceable through citizen suits under RCRA.
EPA published a notice on October 30, 1992, removing the sunset provision. On the same day, EPA withdrew the hazardous
waste identification rule that had been proposed on May 20, 1992. Meanwhile, several hazardous waste generators challenged the March
3, 1992, action that reinstated the derived-from and mixture rules with no changes (Mobil Oil Corp. v. EPA, 35 F.3d 579 (D.C. Cir.
1994)). EPA asserted that the 1992 appropriations act made the challenge moot, because neither the EPA nor the courts were allowed
to terminate or withdraw the reinstated regulations before EPA revised them. In September 1994, the D.C. Circuit Court issued an
opinion matching EPA's.
In October 1994, several generators and treatment, storage, and disposal facility groups filed citizen suits to enforce the October
1, 1994, deadline for revising the mixture and derived-from rules. The U.S. District Court for the D.C. Circuit has not entered a final
consent decree settling the cases as of July 1995. The consent decree will establish a deadline for the proposal and promulgation of a
final rule that amends the derived-from and mixture rules. EPA still intends to do this ttuough the Hazardous Waste Identification Rule,
rather than in a separate rulemaking.
characteristic.1 It is important to note that the contained-in policy is not based on the mixture
or derived-from rules.2 The contained-in principle has been codified for contaminated debris at
Section 261.3(f)(2).3
4.3 JURISDICTIONAL POINTS OF REFERENCE
4.3.1 When a Material Becomes a Hazardous Waste
A solid waste is classified as a hazardous waste when:
• It first meets the listing description
• A listed hazardous waste is first added to a solid waste
• A waste exhibits any hazardous waste characteristic.
1. See memorandum from Sylvia Lowrance to Jeff Zelikson dated January 24, 1989, entitled Status of Contaminated
Groundwater and Limitations on Disposal and Reuse.
2. See Chemical Waste Management v. EPA, 869 F2d. 1526 (D.C. Cir. 1989), which upheld the contained-in
principle as a valid EPA interpretation of its regulations and indicated clearly that the principle is not based on the
mixture or derived-from rules.
3. See the preamble discussion in the August 8, 1992, Federal Register (57 FR 37225).
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A hazardous waste generated in a product or raw material storage tank, transportation
vehicle, pipeline, or a manufacturing process unit or an associated non-water-treatment
manufacturing unit is not subject to regulation as a hazardous waste until it exits the unit in
which it was generated. This provision does not apply if the unit is a surface impoundment or
if the waste remains in the unit more than 90 days after the unit ceases to be operated for
manufacturing or for storage of transportation of product or raw materials, per Section 261.4(c).
4.3.2 When a Material Ceases To Be a Hazardous Waste
A material ceases to be classified as a hazardous waste when it no longer exhibits any
characteristic of hazardous waste, and, in the case of a listed hazardous waste, a waste that
contains a listed hazardous waste, or a waste that is derived-from a listed hazardous, it also has
been delisted according to the procedures in Sections 260.20 and 260.22. A waste that contains
a listed waste ceases to be hazardous once it no longer contains that waste.
4.3.3 Solid Wastes That Are Excluded from the Definition of Hazardous Waste
Solid wastes that are not classified as hazardous wastes per 40 CFR 261.4 include, but are
not limited to:
• Household wastes
• Solid wastes generated by growing crops or raising animals that are returned to the soil
as fertilizers
• Certain wastes that fail the toxicity characteristic (TC), including discarded wood and
wood products that would otherwise be hazardous only due to failing the TC for arsenic,
and petroleum-contaminated media and debris
• Specific wastes from the extraction, beneficiation, and processing of ores and minerals
• Cement kiln dust
• Fly ash waste, bottom ash waste, slag waste, and flue gas emission control waste, all of
which are generated primarily from the combustion of coal or other fossil fuels
• Certain hazardous waste samples being sent to laboratories for hazardous waste
determinations or treatability studies
• Other industry-specific wastes.
The regulatory status of ash from municipal waste combustors (MWC) has long been a
controversial point. A memorandum from the EPA Administrator to all regional administrators,
dated September 18, 1992, and entitled Exemption for Municipal Combustion Ash From
Hazardous Waste Regulation Under RCRA Section 3001(i), explained the rationale behind EPA's
policy on municipal waste combustor ash. Section 300l(i) provides that "...a resource recovery
facility recovering energy from the mass burning of municipal solid waste shall not be deemed
to be treating, storing, disposing of, or otherwise managing hazardous waste...." EPA held that
the title of Section 300 l(i), Clarification of Household Waste Exclusion, showed congressional
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intent to build on the regulatory framework it had earlier established (i.e., household wastes are
excluded from regulation under Subtitle C). EPA asserted in the May 19, 1980, Federal Register
notice that the household waste exclusion carried through to the ash, because Congress had
intended to exclude waste streams generated by consumers at the household level. EPA also
pointed out in the February 18, 1992, policy that Section 3001(i) provides that a resource
recovery facility will not be deemed to be disposing of hazardous waste. Because, ash is
generally the only waste produced by MWCs for disposal, EPA concluded that Congress arguably
intended that MWC ash not be regarded as a hazardous waste. This opinion was not shared by
various litigants and courts.
EPA's policy of exempting MWC ash from Subtitle C was nullified by the Supreme Court
on May 2, 1994. In response, EPA issued a draft sampling guidance document on June 23, 1994,
and published a notice of statutory interpretation on February 3, 1995. EPA interprets the statute
at Section 300l(i) to mean that the ash is subject to Subtitle C when it exits the combustion
building (i.e., "resource recovery facility"), following the combustion and air pollution control
processes. Delaying the sampling of the ash stream until after it has exited the combustion
building will allow facility operators to mix bottom ash and fly ash (the more hazardous
component) in the combustion building, which could result in fewer ash wastestreams being
classified as characteristically hazardous. EPA noted in the February 3, 1995 interpretation notice
that if the fly ash and the bottom ash are generated as two entirely separate wastestreams outside
the combustion building, the two streams must be evaluated separately.
4.4 CONDITIONALLY EXEMPT SMALL QUANTITY GENERATORS (§ 261.5)
Generators of no more than 100 kilograms of hazardous waste a month are conditionally
exempt from Subtitle C for that month. However, generators that accumulate more than 1,000
kilograms of waste at any time become subject to all applicable Subtitle C requirements for all
of the accumulated waste. A conditionally exempt small quantity generator (CESQG) may treat
or dispose of the waste onsite or must ensure delivery to certain types of facilities, including
facilities authorized to operate under Subtitle C, facilities authorized by a state to accept
municipal or industrial waste, a recycling facility, or a universal waste handler or destination
facility subject to Part 273. CESQGs who mix their waste with used oil destined to be burned
for energy recovery are subject to regulation under the Part 279 regulations for management of
used oil.
The following case studies focus on what materials count toward a generator's monthly
hazardous waste quantity. The amount of waste generated monthly determines the relevant
category of generator and, hence, the applicable regulations.
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Case Study - A Small Manufacturing Plant
A small manufacturing plant produces 1,000 gallons per month of spent acid and 5 gallons per month of
spent F001 listed solvent. The pH of the spent acid is 2, and the acid does not exhibit any characteristics of
hazardous waste other than corrosivity. The acid is piped directly from a production unit to a tank in which
the acid is neutralized to a pH of 7. The waste is then disposed of. The spent solvent is stored onsite and
picked up by a solvent recycler every 3 months.
Q: Will this generator be regulated as a full generator, a small quantity generator, or a
conditionally exempt small quantity generator?
A: None of the acid is counted because it is never subject to substantive regulation. The
production unit (§ 261.4(c)), the pipeline, and the neutralization unit (§ 264.1(g)(6)) are all
exempt units, the waste is never stored or accumulated, and after neutralization the waste is no
longer hazardous. The solvent is counted because it is accumulated onsite and would be
subject to § 262.34, which is considered substantive regulation. Thus, this generator generates
5 gallons of waste a month that are counted and stores onsite a maximum of IS gallons. This
is equivalent to approximately 18 kg/month of waste generated, or a total of 54 kg stored or
accumulated. The generator is a conditionally exempt small quantity generator.
Case Study - Dry Cleaner
A dry cleaner uses perchloroethylene in its cleaning process. The dry cleaning system is constructed so that
the used or spent cleaning solvent flows directly from the cleaning unit to a continuous distillation unit and
the reclaimed solvent flows directly back to the cleaning unit. The spent solvent flows through two filters
before entering the distillation unit. The distillation unit processes a total of 3,000 kgs per month of spent
solvent (500 kg total solvent runs through the unit six times per month) and the dry cleaner adds 200 kgs per
month of new solvent to the system. Once every 3 months the dry cleaner replaces the filters and throws
them away. They each weigh 5 kg.
Q:
What wastes must the dry cleaner count toward his generator determination?
A:
Only the filters are counted toward the generator determination. Section 261.5(c) states that
waste that is not subject to regulation or that is subject only to §§ 262.11, 262.12, 262.40(c),
and 262.41 (Le., not subject to substantive regulation) is not included in the quantity
determination. The spent solvent is not subject to regulation because it is managed in a
closed-loop process and, thus, is not included in the quantity determination.
Q:
Will this generator be regulated as a full generator, a small quantity generator, or a
conditionally exempt small quantity generator?
A:
The generator will be regulated as a conditionally exempt small quantity generator, in the
months that the filters are replaced.
Q:
What would the answers to #1 and #2 be if the dry cleaner accumulated the spent solvent
in 55-galIon drums for less than 90 days before the solvent was placed into the distillation
unit?
A:
In this case, the spent solvent would be counted because it is accumulated onsite by the
generator under the provisions of § 262.34 and, thus, is subject to substantive regulation. The
recycling process is no longer closed-loop.
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Case Study - Automobile Repair Shop
An automobile repair shop uses a solvent mixture for cleaning that consists of 50-percent toluene and 50-
percent carbon tetrachloride. The shop generates 99.9 kg per month of spent solvent, which is stored onsite
in a tank. Once a year, on January 1, a solvent recycler pumps out the tank.
Q: Will this generator be regulated as a full generator, a small quantity generator, or a
conditionally exempt small quantity generator?
A: The generator will be regulated as a conditionally exempt small quantity generator from
January through October because he stores less than 1,000 kg and as a small quantity
generator during November and December (§ 261.5(g)(2)) because he is storing more than
1,000 kg.
Q: Could the generator legally have the tank pumped out every 2 years?
A: The generator could not legally have his tank pumped out every 2 years unless he obtained a
permit for storage of hazardous waste.
Section 261.5(g)(2) states that if a conditionally exempt generator accumulates more than
1,000 kg of hazardous waste onsite, the waste becomes subject to the Part 262 regulations for
small quantity generators. This generator reaches 1,000 kg on approximately October 31.
Section 261.5(g)(2) also states that the 180-day onsite storage period begins when the wastes
exceed 1,000 kg. Thus, this generator must have his wastes removed from his shop by the end
of April of the following year (180 days from October 1). Section 262.34(f) indicates that if
the generator accumulates waste onsite for more than the 180 days, he is an operator of a
storage facility and is subject to Part 264 or 265. In order to legally store this waste past the
end of April, this generator would have to have interim status or a permit for storage.
4.5 RECYCLABLE MATERIALS (§§ 261.6 and 266)
Hazardous wastes that are reclaimed to recover a usable product are called recyclable
materials. Handlers of recyclable materials are subject to the requirements for generators,
transporters, and storage facilities prior to the introduction of the material into the recycling unit.
If a facility recycles hazardous wastes without storing them prior to recycling, the facility only
is required to notify under Section 3010 and to comply with the manifest requirements for owners
and operators of hazardous waste management facilities. The actual recycling unit is not
regulated, except for boilers and industrial furnaces burning hazardous waste for energy recovery.
The residues from the exempt unit may be classified as hazardous, however, if they exhibit
characteristics or were derived-from listed wastes.
Certain hazardous wastes recycled in certain ways are regulated under special provisions
in Part 266 and the extent of regulation varies for each material. These wastes are:
• Recyclable materials used in a manner constituting disposal (waste-derived products)
essentially must meet the LDR treatment standards, including fertilizers produced for the
general public use that contain recyclable materials. Products in which the recyclable
materials have undergone a chemical reaction in the course of producing the products
so as to become inseparable by physical means are not subject to regulation if the
products meet applicable LDR standards.
• Recyclable materials from which precious metals are reclaimed.
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• Spent lead-acid batteries that are being reclaimed.
• Hazardous wastes burned in boilers and industrial furnaces for energy recovery.
A special section of the RCRA regulations, Part 279, contains provisions relating to the
management of used oils. Part 279 includes regulations for generators, used oil collection and
aggregation points, transporters and transfer facilities, used oil processors and re-refiners, used
oil burners, and used oil fuel marketers.
In addition, under Section 261.6, certain recyclable materials are not subject to regulation
under Subtitle C. These include industrial ethyl alcohol that is being reclaimed, used batteries
returned to the manufacturer, scrap metal, and several other specific fuels produced from the
refining of oil-bearing hazardous wastes along with normal process streams at petroleum refining
facilities.
4.6 RESIDUES OF HAZARDOUS WASTE IN EMPTY CONTAINERS (§ 261.7)
Under Section 261.7, any hazardous waste remaining in either an "empty" container or an
inner liner removed from an empty container is not subject to regulation as a hazardous waste.
To meet the definition of "empty," all wastes must have been removed that can be removed using
the practices commonly employed to remove materials from that type of container and no more
than 1 inch of residue remains on the bottom or no more than 3 percent by weight of the total
capacity of the container remains in the container or inner liner if the container is less than or
equal to 110 gallons in size (or no more than .3 percent by weight if more than 110 gallons).
A container that has held an acute hazardous waste is "empty" if it has been triple rinsed
using a solvent capable of removing the commercial chemical product or manufacturing chemical
intermediate, and the container has been cleaned by another method that has been shown in the
scientific literature or by a test conducted by the generator to achieve equivalent removal or, in
the case of a container, the inner liner that prevented contact of the commercial chemical product
or intermediate with the containers has been removed.
4-16
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Case Study - National Barrels, Inc.
National Barrels, Inc. (NBI), reconditions drums and resells them. NBI claims that it is not a hazardous
waste facility, but an EPA inspector determined that NBI handled hazardous waste. Under which of the
following scenarios does NBI handle hazardous waste?
Q:
Company A sends NBI empty drums that held chemical products.
A:
There is not enough information to determine whether the residues in the drum are hazardous
wastes because we do not know what chemical products were in the drums, how the drums
were emptied, or if they were cleaned prior to being sent to NBI.
Q:
Company B sends NBI empty drums that held vanadium pentoxide, acetone, methanol,
lead, or nickel cyanide. NBI triple rinses each drum as part of the reconditioning process.
A:
Under 40 CFR 261.33(c), residues in drums that held commercial chemical products listed in
§ 261.33(e) are hazardous wastes unless the drums are triple rinsed or decontaminated by
another method that has been shown to achieve equivalent removal. Both vanadium pentoxide
and nickel cyanide are listed in § 261.33(e), and the drums have not been cleaned prior to
arrival at NBI. Therefore, the residues in the drums are hazardous wastes. (See Compendium
Document 9441.1985(15).)
Q:
Company C uses product acryionitrile in its manufacturing process. Company C empties
and triple rinses the drums that contained product acryionitrile prior to sending them to
NBI.
A:
Because acryionitrile is listed in § 261.33(f), rather than in § 261.33(e), Company C is not
obligated to triple rinse the drums in order to demonstrate they are empty, unless triple rinsing
is the commonly employed practice for emptying drums containing acryionitrile (see
§ 261.7(b)). The containers were rinsed prior to being sent to NBI and, therefore, are empty.
The containers are not considered hazardous wastes.
Q:
Company D uses product benzene in its paint manufacturing process. The benzene is
pumped from 55-gallon drums into the paint batch tanks. The drums are then sent to NBI.
According to NBI, the drums have an inch of benzene residue in them, so they are empty
under 40 CFR 261.7(b)(1).
A:
Under 40 CFR 261.7(b)(1), a container is empty if all wastes are removed that can be removed
using common practices. If additional benzene can be removed by Company D by pouring or
pumping it out of the drums, then the drums are not empty, and NBI is handling a hazardous
waste. See Compendium Document 9441.1984(34).
4.7 UNIVERSAL WASTES (40 CFR Part 273)
Part 273 provides special, reduced management standards for certain universally generated
wastes, including hazardous waste batteries, pesticides, and mercury-containing thermostats.4
These materials often are generated in small quantities by a wide range of residential,
commercial, and industrial facilities, making their collection and recycling difficult. These rules
are intended to encourage the recycling and recovery of the recyclable components within these
4. Promulgated May 11, 1995; 60 FR 25492.
4-17
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
wastes, primarily by making the accumulation of these materials less burdensome than for other
hazardous wastes.
Currently, the rules cover all types of hazardous batteries; generators and handlers of spent
lead acid batteries may elect to continue regulation under Part 266, Subpart G if preferred. The
pesticides covered by the rule include unused recalled pesticides and stocks of other unused
pesticide products that are collected and managed as part of a waste pesticide collection program.
To be included in the rule, the pesticide must be classified as a discarded hazardous waste.
FIFRA regulations still apply to those pesticides that do not meet the applicability provisions of
the universal waste rule.
The management standards for universal wastes are specified for small quantity handlers
of universal waste (those generators or consolidation points that accumulate less than 5,000
kilograms total) and for large quantity handlers of universal waste (those generators or
consolidation points that accumulate more than 5,000 kilograms total). Universal waste handlers
accumulate universal wastes, but do not treat, recycle, or dispose of the waste. The standards
for small quantity handlers of universal waste include common sense containment requirements,
labeling/marking requirements, accumulation time limits, employee training, response to release
provisions, and instructions for offsite shipments and exports. Manifesting is not required when
the shipment is going to another universal waste handler, a destination facility for universal
wastes, or a foreign destination. The management standards for large quantity handlers of
universal waste are similar, except that notification to EPA is required, the personnel training
requirements are slightly more rigorous, and the handlers are required to keep records of their
shipments of universal wastes.
Transporters of universal waste are required to follow Department of Transportation (DOT)
requirements and are prohibited from transporting the waste to a place other than another
universal waste handler, a destination facility, or a foreign destination. A destination facility is
a facility that treats, disposes of, or recycles a particular category of universal waste. These
facilities are subject to all of the provisions for treatment, storage, and disposal facilities.
Case Study - Company A
Company A generates waste methanol in part of its pharmaceutical manufacturing operations. The facility
then reclaims the methanol onsite to a minimum of 99.5-percent purity. The reclaimed methanol is then sent
to Company B, which uses the methanol in various manufacturing processes. Before use, however, Company
B often further reclaims the methanol for a number of reasons (e.g., there is too much color for direct use).
Q: What is the status of the methanol sent to Company B?
A: The methanol was restored to 99.5-percent purity; if this is an acceptable industry standard
(Le., if virgin methanol is sold at this purity), then the methanol is considered a reclaimed
product and is no longer classified as a solid waste. The case may be better supported if there
are other customers of the methanol who do not need to further reclaim the methanol before it
can be used.
/e&
4-18
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Case Study - Ewing Oil Company
Ewing Oil Company is in the business of exploration, development, and production of crude oil. Solvents
such as methylene chloride are used to clean well drilling equipment. JR claims that the spent solvent is
exempt from the hazardous waste regulations under 40 CFR 261.4(b)(5) because it is a waste associated with
the exploration, development, or production of crude oil.
Q: Do you agree?
A: As usual, JR is trying to avoid the law. The exemption covers wastes uniquely associated with
the exploration, development, arid production of crude oil, natural gas, or geothermal energy.
Solvents are not uniquely associated with these industries and, therefore, are not eligible for
the exclusion. See Compendium Documents 9441.1984(33) and 9441.1987(04).
Case Study - Columbus Chemicals, Inc.
Columbus Chemicals, Inc., produces aniline from phenol and ammonia. Several times during each
production shift distillation column bottoms are tested at the in-house laboratory to determine whether they
have the properties required for recycle back into the process. Spent and excess sample materials are
discarded via the laboratory sinks.
Several organic waste streams at the plant are treated at an activated sludge treatment facility. The effluent
from the treatment facility is disposed of via deep well injection. The waste streams entering the treatment
plant and their annual flows are as follows:
• Sanitary wastewaters—2,000,000 gal
• Oxidizer water from the production unit (nonhazardous)—15,000,000 gal
• Rinsewater from emergency showers and equipment washdown (assumed
nonhazardous)—500,000 gal
• Laboratory wastewater—150,000 gal
Q: Is the mixed wastewater a hazardous waste?
A: Yes, the laboratory wastewater is a hazardous waste. It is a mixture of a listed hazardous
waste (K083, a toxic waste) and solid waste (the wastewater).
This scenario meets all the requirements for exclusion of the waste stream under the mixture
rule provisions of § 261.3(a)(2)(iv)(E), except for one. The wastewater effluent is not subject to
regulation under Section 402 or 307(b) of the Clean Water Act. (The clue leading to that
conclusion is the fact that the effluent is disposed of via deep well injection.)
/#7
4-19
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Case Study - Westar Refining
Westar Refining generates a process wastewater that flows to an API separator. At the API separator, the oil
layer at the surface is skimmed off, sludges settle out and are pumped off the bottom of the separator unit,
and the wastewater is discharged to a surface impoundment prior to discharge through a National Pollutant
Discharge Elimination System (NPDES) outfall into the Hudson River. The oil is stored in a holding tank
prior to land treatment. The sludges are placed in a settling pond, where further sedimentation occurs prior
to disposal at the Foreversafe Landfill, a permitted Subtitle C facility.
Q: Are any of these wastes (the oil, the sludge, or the wastewater) solid wastes?
A: All of the wastes are solid wastes. The oil is discarded by being stored prior to placement on
the land. The sludge is treated prior to disposal in a landfill The wastewater is not excluded
from being considered a solid waste (§ 261.4(a)) until it passes through the NPDES discharge
point.
Q: Are any of these wastes hazardous wastes? If yes, what EPA identification number should
be assigned to them?
A: The oil is not a hazardous waste unless it exhibits a characteristic of hazardous waste. The
sludge is a listed waste, K051. The wastewater is not a hazard waste unless it exhibits a
characteristic.
4-20
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Case Study - Gro-Green Lawn Mower Company, Speedy Dry Cleaners,
Rite-Well Ink, Inc.
For each of the following situations, determine whether the waste is a solid waste and a hazardous waste.
Q: The Gro-green Lawn Mower Company uses a solvent-based paint on its lawn mowers.
Painting is done in a water-wall paint spray booth and generates a waste. The separated
solvent/paint sludge from this waste stream is placed in drums and sent to the D-Zolve
Treatment and Disposal plant, which has a RCRA permit The sludge contains solvent
mixtures containing more than 10 percent of a listed solvent (e.g., methylene chloride).
A: The sludge is a solid waste because it is being discarded by being treated prior to disposal.
The sludge may not be a hazardous waste. If the sludge is from used paint containing solvent,
it is not a spent solvent waste regardless of the percentage of the solvent in the sludge. The
listing for spent solvents in F001-F005 is for solvents used for their solvent properties, not for
solvents that happen to be components of chemical formulations. On the other hand, if a
listed solvent was used to clean the spray booth, then all of the waste generated (i.e., used
paint drippings, solvent) from the booth is a listed "F" waste under the mixture rule. Note
that under the revised definitions of spent solvents, solvent mixtures containing 10 percent or
more of listed solvents F001, F002, F004, or F005 prior to use are hazardous wastes when
spent. See the December 31, 198S, Federal Register and Compendium Document, May 2,
1986. However, the waste must always be checked to determine whether it meets any of the
hazardous waste characteristics.
Q: Gro-green also generates spent 1,1,1-trichloroethane from parts cleaning operations that is
also sent to D-Zolve for disposal.
A: The spent solvent is both a solid waste and a hazardous waste (F002). It is a solid waste
because it is being discarded by being disposed of. It is a listed hazardous waste because the
spent solvent meets the listing for F002.
Q: Speedy Dry Cleaners uses tetrachloroethylene (perc) in its dry cleaning processes. Speedy
filters spent tetrachloroethylene using cartridge filters and recovers the solvent The filter
cartridges are disposed of offsite.
A: EPA considers the spent filter cartridges to be solid wastes because they are disposed of and
hazardous wastes because perc is an F002 waste and the filters are derived from the treatment
of F002 waste. Solvent listings include the sludge or residue from the recovery of solvents,
and filter cartridges are considered to be residue. See Compendium Document 9444.1987(18).
It is also important to test the solvents under the TCLP to determine whether they meet the
D039 characteristic.
Q: Rite-well Ink, Inc., formulates printing inks. Filter cartridges are used to remove
suspended solids and residues from the ink and the filters are sent to an offsite disposal
facility. The residues on the filter cartridges contain more than 10 percent toluene by
weight Toluene is used as a constituent in the ink formulation.
A: The filter cartridges are solid wastes. It is not clear whether they are hazardous wastes. They
are not a listed waste. Because toluene was used as an ingredient, rather than as a solvent,
the waste does not meet the definition of waste F005. The waste also is not a commercial
chemical product (U220) because the toluene was used in an industrial process. The waste
also does not meet the description of waste K086, ink formulation waste. The waste might be
ignitable or TC and, therefore,- a characteristic waste, but that information is not provided.
4-21
September 1995
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RCRA Practitioners Enforcement Workshop
Identifying Solid and Hazardous Wastes
Case Study - PROCHEMCO
PROCHEMCO generates a vent gas stream from its organic production process. The vent gas stream
contains the following components:
• Methyl ethyl ketone—20%. (by volume)
• Methanol—20%
• Methyl ether—20%
• Nitrogen—40%
The temperature of this gas stream is 240F°. This stream is burned in a fume incinerator.
Q: Is this gas stream considered a solid waste?
A: Gas streams are not covered by the definition of solid waste because they are not "contained"
(see RCRA § 1004(27)). Also, EPA has determined that the burning of gaseous wastes in
fume incinerators is covered by the Clean Air Act rather than the Resource Conservation and
Recovery Act. If the gas stream were condensed to a liquid, that liquid might be a hazardous
waste due to the characteristics of ignitability or toxicity. Furthermore, in a February 10,
1984, FR notice, (49 FR 5314), EPA stated that "gaseous emissions which are condensable to
liquids at STP can be subject to regulation under, RCRA.
Q: Is it a hazardous waste? If yes, what EPA identification number should be assigned to it?
A: Because the waste stream is not a solid waste, it cannot be a hazardous waste.
4-22
September 1995
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Appendix A
Solid and Hazardous Waste Exercises
'?t
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Solid Waste
Case Study - Beacon Chemical Company
Beacon Chemical Company, located in Staten Island, is a formulator of specialty chemicals. The wastewater
from reaction tank cleaning contains minimal amounts of reaction residues. Some of the chemicals used in
the reaction are listed as commercial chemical products in 40 CFR 261.33. The wastewater is discharged to
an offsite publicly owned treatment works (POTW) via the city sewer line.
Q: Is the wastewater a solid waste?
Case Study - Kamakaze Kemical Company
Kamakaze Kemical Company purchases spent pickle liquor from ABC Steel. Kamakaze uses the spent
pickle liquor as a raw material in its chemical manufacturing process where it serves as a reactant. The
manufacturing process is proprietary. The spent pickle liquor is stored in tanks prior to use.
Q: Is the spent pickle liquor a solid waste?
A-l
September 1995
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Case Study - XYZ Corporation
The XYZ Corporation produces metal parts using a chrome electroplating process. No cyanides are used
during production. The process generates a wastewater treatment sludge that has a very high chrome content
that would be hazardous for chrome under the TC (D007). The sludge is pumped into 55-gallon containers
and placed in a container storage area onsite. During the last 2 years, about 500 gallons of the sludge have
been added to the container storage area every 6 months. The owner of XYZ is planning to ship the sludge
to a recycler that operates a chrome recovery process. However, no shipments of sludge have been made to
the recycler within the last 2 years. XYZ asserts that the sludge will be shipped to the recycler in the next
year. The owner also claims that the sludge is not a solid waste under the RCRA regulations and, therefore,
cannot be a hazardous waste. Thus, he believes that no storage permit is required for the container storage
areas because he is not storing a hazardous waste.
Q: Is the waste a solid waste?
Case Study - Metals-R-Us
Metals-R-Us engages in a manufacturing process that results in a baghouse dust and a wastewater treatment
plant sludge. Both wastes exhibit the characteristic of toxicity for lead. The baghouse dust is stored in a
covered waste pile, while the treatment plant sludge is stored in an open waste pile with perimeter curbing.
Effective January 1, 1986, Metals-R-Us entered into a contract agreement with Marvin's Metals Recovery
(MMR), Inc., to provide both of these materials to MMR in return for $2/ton, with MMR paying all shipping
costs. MMR operates a lead recovery process in a nearby city.
During a recent facility inspection at Metals-R-Us, records were reviewed and the following facts established:
1. During calendar year 1986, there were 10 shipments of baghouse dust to MMR, with a total weight
of 165 tons.
2. There were two shipments of waste treatment plant sludge during calendar year 1986—one of 2.5
tons and another of 4.3 tons.
3. There was no baghouse dust in storage on January 1, 1986, and an estimated 190 tons of dust were
generated during the year. In addition, there were an estimated 140 tons of treatment plant sludge
at the start of 1986.
Upon questioning, the plant engineer explained that, although the treatment plant sludge has sufficient lead
content for MMR's reclamation process, the moisture content interferes with the process. They have been
holding the sludge in the waste pile in hopes that it will dry sufficiently. The two 1986 shipments were sent
for pilot test purposes.
Q: Is either material a solid waste?
A-2
September 1995 /f3
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Case Study - Electric Arc Furnace Dust
Electric arc furnace baghouse dust (K061) containing high levels of lead, among other components, is sent to
a cement kiln as an ingredient for cement in place of iron ore. The K061 contains lead in concentrations
several orders of magnitude higher than the levels found in the iron ore. Prior to insertion into the cement
kiln, the K061 is mixed with mill scale (a nonhazardous solid waste) to make the iron content more even.
The cement processor receives a fee from the K061 generators for taking the waste.
Q: Is the baghouse dust sent to the cement kiln a solid waste?
Hazardous Waste
Case Study - A Small Manufacturing Plant
A small manufacturing plant produces 1,000 gallons per month of spent acid and 5 gallons per month of
spent F001 listed solvent. The pH of the spent acid is 2, and the acid does not exhibit any characteristics of
hazardous waste other than corrosivity. The acid is piped directly from a production unit to a tank in which
the acid is neutralized to a pH of 7. The waste is then disposed of. The spent solvent is stored onsite and
picked up by a solvent recycler every 3 months.
Q: Will this generator be regulated as a full generator, a small quantity generator, or a
conditionally exempt small quantity generator?
A-3
September 1995 /ff
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Case Study - Dry Cleaner
A. dry cleaner uses perchloroethylene in its cleaning process. The dry cleaning system is constructed so that
the used or spent cleaning solvent flows directly from the cleaning unit to a continuous distillation unit and
the reclaimed solvent flows directly back to the cleaning unit. The spent solvent flows through two filters
before entering the distillation unit. The distillation unit processes a total of 3,000 kgs per month of spent
solvent (500 kg total solvent runs through the unit six times per month) and the dry cleaner adds 200 kgs per
month of new solvent to the system. Once every 3 months the dry cleaner replaces the filters and throws
them away. They each weigh 5 kg.
Q: What wastes must the dry cleaner count toward his generator determination?
Will this generator be regulated as a full generator, a small quantity generator, or a
conditionally exempt small quantity generator?
What would the answers to #1 and #2 be if the dry cleaner accumulated the spent solvent
in 55-gallon drums for less than 90 days before the solvent was placed into the distillation
unit?
A-4
September 1995
/9fT
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Case Study - Automobile Repair Shop
An automobile repair shop uses a solvent mixture for cleaning that consists of 50-percent toluene and 50-
percent carbon tetrachloride. The shop generates 99.9 kg per month of spent solvent, which is stored onsite
in a tank. Once a year, on January 1, a solvent recycler pumps out the tank.
Q: Will this generator be regulated.as a full generator, a small quantity generator, or a
conditionally exempt small quantity generator? -
Q: Could the generator legally |iave the tank pumped out every 2 years?
A-5
September 1995
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Recyclable Materials
Case Study - National Barrels, Inc.
National Barrels, Inc. (NBI), reconditions drums and resells them. NBI claims that it is not a hazardous
waste facility, but an EPA inspector determined that NBI handled hazardous waste. Under which of the
following scenarios does NBI handle hazardous waste?
Q: Company A sends NBI empty drums that held chemical products.
Q: Company B sends NBI empty drums that held vanadium pentoxide, acetone, methanol,
lead, or nickel cyanide. NBI triple rinses each drum as part of the reconditioning process.
Company C uses product acrylonitrile in its manufacturing process. Company C empties
and triple rinses the drums that contained product acrylonitrile prior to sending them to
NBI.
Company D uses product benzene in its paint manufacturing process. The benzene is
pumped from 55-gallon drums into the paint batch tanks. The drums are then sent to NBI.
According to NBI, the drums have an inch of benzene residue in them, so they are empty
under 40 CFR 261.7(b)(1).
A-6 September 1995
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Universal Wastes
Case Study - Company A
Company A generates waste methanol in part of its pharmaceutical manufacturing operations. The facility
then reclaims the methanol onsite to a minimum of 99.5-percent purity. The reclaimed methanol is then sent
to Company B, which uses the methanol in various manufacturing processes. Before use, however, Company
B often further reclaims the methanol for a number of reasons (e.g., there is too much color for direct use).
Q: What is the status of the methanol sent to Company B?
Case Study - Ewing Oil Company
Ewing Oil Company is in the business of exploration, development, and production of crude oil. Solvents
such as methylene, chloride are used to clean well drilling equipment. JR claims that the spent solvent is
exempt from the hazardous waste regulations under 40 CFR 261.4(b)(5) because it is a waste associated with
the exploration, development; or production of crude oil.
Q: Do you agree?
A-7
September 1995
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Case Study - Columbus Chemicals, Inc.
Columbus Chemicals, Inc., produces aniline from phenol and ammonia. Several times during each
production shift distillation column bottoms are tested at the in-house laboratory to determine whether they,
have the properties required for recycle back into the process. Spent and excess sample materials are
discarded via the laboratory sinks.
Several organic waste streams at the plant are treated at an activated sludge treatment facility. The effluent
from the treatment facility is disposed of via deep well injection. The waste streams entering the treatment
plant and their annual flows are as follows:
• Sanitary wastewaters—2,000,000 gal
• Oxidizer water from the production unit (nonhazardous)—15,000,000 gal
• Rinsewater form emergency showers and equipment washdown (assumed
nonhazardous)—500,000 gal
• Laboratory wastewater—150,000 gal
Q: Is the mixed wastewater a hazardous waste?
Case Study - Westar Refining
Westar Refining generates a process wastewater that flows to an API separator. At the API separator, the oil
layer at the surface is skimmed off, sludges settle out and are pumped off the bottom of the separator unit,
and the wastewater is discharged to a surface impoundment prior to discharge through a National Pollutant
Discharge Elimination System (NPDES) outfall into the Hudson River. The oil is stored in a holding tank
prior to land treatment. The sludges are placed in a settling pond, where further sedimentation occurs prior
to disposal at the Foreversafe Landfill, a permitted Subtitle C facility.
Q: Are any of these wastes (the oil, the sludge, or the wastewater) solid wastes?
Q: Are any of these wastes hazardous wastes? If yes, what EPA identification number should
be assigned to them?
A-8
September 1995
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Appendix A—Case Studies
Identifying Solid and Hazardous Wastes
Case Study - Gro-Green Lawn Mower Company, Speedy Dry Cleaners,
Rite-Well Ink, Inc.
For each of the following situations, determine whether the waste is a solid waste and a hazardous waste.
Q: The Gro-green Lawn Mower Company uses a solvent-based paint to paint its lawn mowers.
Painting is done in a water-wall paint spray booth and generates a waste. The separated
solvent/paint sludge from this waste stream is placed in drums and sent to the D-Zolve
Treatment and Disposal plant, which has a RCRA permit The sludge contains solvent
mixtures containing more than 10 percent of a listed solvent (e.g., methylene chloride).
Q: Gro-green also generates spent 1,1,1-trichloroethane from parts cleaning operations that is
also sent to D-Zolve for disposal.
Speedy Dry Cleaners uses tetrachloroethylene (perc) in its dry cleaning processes. Speedy
Alters spent tetrachloroethylene using cartridge filters and recovers the solvent The Alter
cartridges are disposed of offsite.
Q: Rite-well Ink, Inc., formulates printing inks. Filter cartridges are used to remove
suspended solids and residues from the ink and the filters are sent to an offsite disposal
facility. The residues on the filter cartridges contain more than 10 percent toluene by
weight Toluene is used as a constituent in the ink formulation.
A_9 September 1995
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
5. NEW AND UPCOMING DEVELOPMENTS
&EPA
3.*!
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Module 5 Objectives
• Become familiar with recent and upcoming
developments in the RCRA program
• Discuss:
- Status of activity
- Content of rule or policy
- Enforcement implications of rule or policy
Notes:
1
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Subpart CC
• Final Rule promulgated December 6, 1994
(59 FR 62896); effective December 5,1995
• Generators and TSDFs using tanks, surface
impoundments, containers, and
miscellaneous units to manage volatile
organic-containing hazardous waste must
install volatile organic emissions controls
• Specific exemptions
Notes:
2
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Subpart CC (Continued)
• Rule establishes inspection schedules;
reporting required for interim status facilities
• All facilities initially will have interim status
• Permit modifications will occur at the time of
permit renewal
Notes:
3
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Land Disposal Restrictions
• Chemical Waste Management, Inc, v. EPA
- Treatment standards may exceed characteristic
- Standards must result in destruction and removal
of hazardous constituents
- Restrictions on the management of de-
characterized wastes
Notes:
4
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
r
A
LDR: EPA Response to Remand
• Interim final rule: deactivation treatment
standard for ignitabie and corrosive wastes
(5/24/93; 58 FR 29860)
— Imposes specific restrictions on the land disposal
of decharacterized D091 and D002
Notes:
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Notes:
LDR: EPA Response to Remand (Continued)
• Phase n LDR rule (9/19/94; 59 FR 47982)
- New treatment standards
- Universal treatment standards
6
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
LDR: EPA Response to Remand (Continued)
• EPA proposed the Phase III LDR rule
(3/2/95; 60 FR 11702)
- Decharacterized wastewaters
• Implications of LDR rulemakings
V
J
Notes:
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Hazardous Waste Identification Rule
• To be proposed early fall 1995
• Self-implementing system establishing risk-
based exit levels from hazardous waste
classification for process wastes
• Applies to listed wastes, or wastes that have
been mixed with, derived from, or contain
listed hazardous wastes
Notes:
8
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
HWIR—Procedures for Claimant
Must prepare and follow sampling and
analysis plan
May claim constituent(s) not present in waste
and, therefore, testing not necessary
Must provide notification and certification
that waste meets exemption levels
Where exit levels capped by detection limits,
waste must meet LDR standards
Technology-based LDR treatment standards
capped by the risk-based exit levels
Notes:
9
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Revised Combustion Standards
• By 9/20/95, settlement agreement requires
EPA to propose new standards for cement
kiins, incinerators, and lightweight aggregate
kilns
• Key component Combustion Strategy
• Issued under RCRA and CAA
• Impose MACT standards, with national risk
check, for dioxins and furans, heavy metals,
PM, HC1, Cl2, CO, and total hydrocarbons
Notes:
10
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Revised Combustion Standards (Continued)
• Implementation plan provides broad
flexibility to states
• National risk check will allow permits to be
issued to RCRA-regulated units
• RCRA/CAA rule; states to decide how
permit-writing and compliance/enforcement
resources should be allocated
Notes:
11
September 1995
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RCRA Practitioners Enforcement Workshop
New and Upcoming Developments
Revisions in the Definition of Solid Waste
• Proposed rule revising recycling regulations
due out in late 1996
• States, through ASTSWMO, actively
working with EPA in developing strategy for
changing regulations
• Report issued in September 1994, entitled Re-
engineering RCRA for Recycling
Notes:
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New and Upcoming Developments
Key Points of EPA's Strategy
• Clarify jurisdiction of RCRA with regard to
recycling by distinguishing between
manufacturing-like processes and waste
management-like processes
• Refine management standards to encourage
recycling
• Evaluate implementation needs for EPA and
states
• Evaluate mineral processing industry and
petroleum refining industry separately
Notes:
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Supplemental Environmental Projects (SEPS)
• OECA issued new policy issued on May 3,
1995
• Definition
- Environmentally beneficial project
- In settlement of an enforcement action
- Not otherwise legally required to perform
Notes:
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New and Upcoming Developments
SEPs (Continued)
• Goal of Policy
- Obtain environmental and public health
protection and improvements not otherwise
available without the incentives of the policy
- Encourage environmental justice and pollution
prevention
Notes:
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Guidelines for SEPS
• Must have adequate nexus (relationship
between violation and project)
• Project must advance objectives of the
environmental statute that is basis of the
enforcement action
• EPA cannot manage or control funds set
aside for completion of SEP
• Third party performance not allowed
Notes:
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Guidelines for SEPS (Continued)
• SEP cannot be something EPA is required to
do; SEP cannot provide funds to perform an
activity already funded by Congress
• Type and scope of project must be specified
in the settlement agreement
Notes:
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CATEGORIES OF SEPs
• Public health
• Pollution prevention
• Pollution reduction
• Restoration and protection
• Assessments and audits
• Compliance promotion
• Emergency planning
and preparedness
Notes:
f
r P2
o
EPCRA
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Penalty Mitigation Procedures
• Determine gravity and economic components
of penalty using RCPP
• Recover 100% of economic benefit plus 10%,
or 25% of gravity, whichever is greater
• Use PROJECT to determine net-present,
after-tax cost of SEP project, including
calculation of benefit of SEP project to
respondent
Notes:
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f \
Penalty Mitigation Procedures (Continued)
• Evaluate project against factors to determine
mitigation percentage
- Benefits to public or environment
- Innovativeness
- Environmental justice
- Multimedia impacts
- Pollution prevention approach
Notes:
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Penalty Mitigation Procedures (Continued)
• Allow up to 80% of SEP costs in mitigation of
gravity component
• May allow up to 100% of SEP costs in
mitigation for small businesses, government
agencies, and non-profits
• May allow up to 100% of SEP costs in
mitigation if pollution prevention project
• Settlement must include stipulated penalties
for noncompliance
Notes:
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Audit Policy
• Published on April 3, 1995; became effective
on April 18, 1995
• Agency-wide policy
• Provides incentives for companies that
voluntarily evaluate compliance and disclose
violations
Notes:
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Provisions of Audit Policy
• EPA will eliminate gravity component of the
penalty if seven conditions met
• EPA will eliminate 75% of gravity if most,
but not all, seven conditions met
• EPA will not recommend to DOJ that
criminal charges be brought against
companies that voluntarily audit and
disclose, as long as there is no pattern of
noncompliance
Notes:
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Seven Conditions of Policy
• Voluntary self-policing
• Voluntary disclosure
• Prompt correction
• Remediation of imminent and substantial
endangerment
• Remediation of harm and prevention of
repeat violations
• No lack of appropriate preventive measures
• Cooperation
Notes:
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Other Audit Policy Provisions
• EPA has discretion to collect gravity
component in appropriate cases (criminal
conduct, imminent or substantial
endangerment).
• EPA will not request a voluntary
environmental audit report to trigger a civil
or criminal investigation.
Notes:
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Audit Policy Implications
• EPA will examine state audit privilege and
penalty immunity laws to determine whether
additional federal enforcement is necessary
• Additional enforcement may be necessary if
state policies/laws make it difficult to obtain
information necessary to satisfactorily
recover penalties, establish criminal liability,
and provide for prompt return to compliance
Notes:
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Small Business Policy
• OECA issued interim policy June 13, 1995;
became effective that day
• Final policy will be issued after receipt and
consideration of public comments
• Policy's intent is to promote environmental
compliance among small businesses by
providing incentives for participation in
compliance assistance programs and
encouraging the prompt correction of
violations
Notes:
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Applicability
• Applies to small businesses (person,
corporation, partnership, or other entity that
employs 100 or less on a company-wide basis)
• Applies to all civil judicial and administrative
enforcement actions under EPA programs,
except for corrective action and the Public
Water System Supervision Program under
Safe Drinking Water Act
• Settlement policy
Notes:
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Criteria for Elimination or Mitigation of Penalty
• Good faith effort to comply as demonstrated
by receiving compliance assistance
• First violation of a particular requirement
• Violation has not caused serious harm,
imminent and substantial endangerment, or
significant health, safety, or environmental
threat
• No criminal activity
• Violation corrected within specified period
Notes:
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Mitigation Discretion
Eliminate the civil settlement penalty if all
five criteria met
Waive up to 100% of gravity if business
meets all five criteria, but needs longer than
180 days for non-P2 or 360 days for P2
remedies
Discretion to use media-specific policies to
refrain from filing an enforcement action
seeking penalties or mitigate penalty if
business does not meet criteria but has made
a good faith effort to comply
Notes:
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Other Factors
• Violations detected through traditional
enforcement means remain fully enforceable.
• Business is subject to all applicable
enforcement measures if violations are not
remedied within agreed upon time period.
• Policy does not limit EPA or states discretion
to use information obtained by compliance
assistance as evidence in subsequent
enforcement action.
Notes:
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© 1991 Wilson Jones Company
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5. NEW AND UPCOMING DEVELOPMENTS
Background Materials
-------
INSTRUCTOR NOTES
RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
5. NEW AND UPCOMING DEVELOPMENTS
Time: 2 hours
Objectives:
¦ Familiarize RCRA case development staff with recent and upcoming developments in the
RCRA program, including:
- Organic Air Emission Standards for Tanks, Surface Impoundments, and Containers (40
CFR Part 264/265, Subpart CC)
- Land Disposal Restrictions (40 CFR Part 268)
- Hazardous Waste Identification Rule (HWIR)
- Upcoming Revised Combustion Standards
- Definition of Solid Waste
- New Supplemental Environmental Project (SEP) Policy
- New Interim Audit Policy
- New Small Business Policy.
Emphases:
¦ Status of activity.
¦ Summary of rule or policy.
¦ Enforcement implications of rule or policy.
Helpful Hints:
¦ This module functions more as an update, since enforcement implications are not clear in all
cases. New policies have important enforcement and penalty implications.
Bibliography:
Organic Air Emission Standards for Tanks, Surface Impoundments, and Containers; Final Rule
(40 CFR Part 264/265, Subpart CC) (59 FR 62896; 12/6/94).
LDR Rulemakings (40 CFR Part 268): Interim Final Deactivation Treatment Standards for
Ignitable and Corrosive Wastes (58 FR 29860; 5/24/93); Phase II LDR Treatment Standards
(59 FR 47982; 9/19/94); Phase III LDR Proposed Rule (60 FR 11702; 3/2/95).
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Interim Revised EPA Supplemental Environmental Projects Policy, 5/3/95, EPA/OECA.
Interim Policy Statement and Request for Comment: Self-Disclosure Incentives Policy
(60 FR 16875; 4/3/95).
Interim Policy on Compliance Assistance for Small Business, 6/13/95, EPA/OECA.
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5. NEW AND UPCOMING DEVELOPMENTS
5.1 INTRODUCTION
This module provides an overview of several new and upcoming developments within the
Resource Conservation and Recovery Act (RCRA) program. These developments include several
new rules and policies each. The rules and policies addressed include the following:
• Organic Air Emission Standards for Tanks, Surface Impoundments, and Containers
(40 CFR Part 264/265, Subpart CC)
• Land Disposal Restrictions (40 CFR Part 268)
• Hazardous Waste Identification Rule (HWIR)
• Upcoming Revised Combustion Standards
• Definition of Solid Waste
• New Supplemental Environmental Project (SEP) Policy
• New Interim Audit Policy.
For each rule or policy, the module presents a discussion of the status of the action, a
summary of the major provisions of the rule or policy, and enforcement implications to the extent
they are clear.
5.2 40 CFR PARTS 264/265 SUBPART CC: ORGANIC AIR EMISSION
STANDARDS FOR TANKS, SURFACE IMPOUNDMENTS, AND
CONTAINERS
5.2.1 Status
Final Rule promulgated December 6, 1994 (59 FR 62896). Effective Date: December 5, 1995
(extended on 5/19/95, 60 FR 26828).
5.2.2 Requirements
Generators of hazardous wastes and hazardous waste treatment, storage, and disposal facilities
using tanks, surface impoundments, containers, and miscellanieous units (i.e., those units subject
to 40 CFR Subpart X requirements), for the management of volatile organic-containing hazardous
waste after December 6, 1995, must install volatile organic emissions controls. The new
regulations do not apply to: RCRA exempt units; units holding existing wastes to which no new
waste is added; satellite accumulation containers; small containers (< 0.1 m3); closed tanks or
containers; and units used for management of mixed radioactive wastes or for onsite remedial
activities.
The regulations are applicable to units receiving hazardous wastes having a volatile organic
concentration greater than 100 ppmw at the point of origination. This may be determined
through sampling and analysis or knowledge. The regulations continue to apply to all
downstream units receiving the hazardous waste until the organics are treated or destroyed:
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• To an average volatile organic (VO) concentration of < 100 ppmw;
• To an average VO concentration at the point of treatment that is less than the exit
concentration limit for the process;
• Through treatment (for multiple hazardous waste streams) where the organic reduction
efficiency for the process is > 95 percent and the average VO concentration is
< 50 ppmw;
• Through treatment where the actual organic mass removal rate is > the required mass
removal rate for the process; or
• By biological treatment where the organic reduction efficiency and the organic
biodegradation efficiency are > 95 percent or where the actual organic mass
biodegradation rate is > required mass biodegradation rate for the process.
The regulations stipulate specific design criteria for the organic emissions control technologies.
Inspection schedules are established, and reporting is required for interim status facilities.
5.2.3 Implications
All facilities initially will have interim status. Permit modifications will occur at the time of
permit renewal. A permit document is under development by the Permits and State Programs
Division. An implementation document is under development by the Office of Air Quality
Planning and Standards and a compliance and enforcement checklist is under development by the
Office of Enforcement and Compliance Assurance (OECA).
5.3 LAND DISPOSAL RESTRICTIONS (40 CFR Part 268)
5.3.1 Status
Court Remand of Third LDR Rulemaking
On September 25, 1992, the U.S. Court of Appeals ruling in Chemical Waste Management,
Inc. et al. v. EPA (976 F. 2d 2), took several actions regarding land disposal restriction (LDR)
treatment standards promulgated under the LDR Third Rulemaking. Three major provisions of
the court's ruling (from 60 FR 11705, 3/2/95) are:
• LDR treatment standards may be set at levels more stringent than those at which
wastes are identified as hazardous
• Standards must result in destruction and removal of hazardous constituents as well
as their characteristic property. Therefore, dilution is permissible as a method of
treatment only for those wastes with hazardous constituent concentrations that do not
pose a risk to human health and the environment
• Characteristic wastes that are diluted and lose their characteristic may not be
managed in centralized wastewater land disposal units (i.e., Subtitle D surface
impoundments or Class I underground injection wells) unless it can be demonstrated
that hazardous constituents are reduced or destroyed to the same extent as they would
be under other LDR treatment standards.
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EPA Rulemakings in Response to Court Remand
On May 24, 1993 (58 FR 29860), the U.S. Environmental Protection Agency (EPA)
promulgated an interim final rule reestablishing the deactivation treatment standard for ignitable
and corrosive wastes. This standard had been vacated (eliminated) by the court. The interim
final rule avoided a complete ban on land disposal of these wastes pending further action by the
Agency.
On September 19, 1994 (59 FR 47982), EPA promulgated the Phase II LDR treatment
standards, which among other provisions, establishes universal treatment standards and prohibits
the injection of high total organic carbon (TOC) ignitable (D001) and toxicity characteristic (TC)
organic pesticide wastes (D012-D017) into underground injection wells unless treated to meet all
applicable treatment standards or a no migration petition has been approved for the well.
On March 2, 1995 (60 FR 11702), EPA proposed the Phase HI LDR rule to address the
decharacterized wastewaters portion of the court's remand of the Third rulemaking.
5.3.2 Requirements
Interim Final Rule
Effective August 9, 1993, land disposal of decharacterized ignitable wastes (D001, not
including high TOC ignitable) and corrosive wastes (D002) was prohibited unless the wastes are
managed:
• In systems whose discharge is subject to Clean Water Act (CWA) regulation,
• In Class I deep wells regulated under the Safe Drinking Water Act, or
• By zero dischargers that engage in CWA-equivalent treatment before land disposal.
Phase II Final Rule
The rule established treatment standards for:
• Newly listed wastes from coke and coke by-products (K141-K145, K147-K148)
• Newly listed wastes from chlorotoluenes production (K149-K151)
• Newly Identified organic TC wastes (D018-D043)
In addition, Universal Treatment Standards (UTS) for wastewater and nonwastewater forms
of over 200 constituents were created. The UTS provide a single concentration limit for a
specific constituent. While the constituents of concern in listed wastes remain the same, all
standards have been revised to match the UTS.
The rule prohibits the dilution of high TOC ignitable and TC Pesticide wastes that are to be
injected into Class I Deep Wells. Generators and facilities that managed organic TC wastes in
system other than those regulated under CWA, those engaged in CWA-equivalent treatment prior
to land disposal, or those injecting in Class I deep injection wells must monitor or otherwise
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determine the presence of underlaying hazardous constituents "reasonably expected to be present."
Hazardous constituents present in decharacterized waste must be treated to meet UTS.
Finally, recycling provisions were revised. The "closed-loop" recycling provision at 40 CFR
261.2(e)(l)(iii) was broadened to exclude from the definition of solid waste residues from
secondary processes that are reinserted into the process without reclamation, as was the variance
provision at 40 CFR 260.30(b).
5.3.3 Implications
With promulgation of UTS, a treatment, storage, and disposal facility managing several
hazardous wastes with similar constituents therein needs to achieve the universal standard for
those similar constituents. (Previously, constituent concentration standards had varied from waste
to waste.) Generators may continue to use knowledge of the waste to determine whether a waste
meets the universal treatment standards.
The notification statement under 40 CFR 268.9(d) has been revised to allow for the possibility
that decharacterized wastes may require addition treatment for underlying constituents. A new
certification was added at 40 CFR 268.7(b)(5) that contains similar language. Notifications need
only list those underlying constituents present in the waste as generated, prior to mixing with
other wastes.
5.4 HAZARDOUS WASTE IDENTIFICATION RULE
5.4.1 Status
Proposed rule scheduled to be published late summer/early fall of 1995.
5.4.2 Summary
The HWIR will establish constituent-specific exit levels for low-risk solid wastes that are
classified as hazardous because they are listed, or have been mixed with or derived from, or
contain listed wastes. In essence, the rule establishes a risk-based "floor" for hazardous waste
listings. The rule applies to process wastes; a separate rule is being developed to address
environmental media. To establish many of the exit levels, EPA used a risk assessment approach
that evaluated potential exposure pathways, both direct and indirect, from a variety of sources,
such as waste piles and surface impoundments. EPA's risk assessment approach included both
environmental and human receptors. Some of the exit levels are based on an alternative risk
analysis. In some cases, analytical detection limits cap the risk-based levels. Wastes for which
the exit levels are limited by analytical detection limits must meet additional requirements to be
eligible for exit.
This rule, as proposed, will be self-implementing; generators must properly notify the
applicable environmental agency, meet other administrative requirements, and comply with the
ongoing conditions of the exemption.
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The HWIR also contains proposed changes to some of the numerical treatment standards in
the LDR program. The rule proposes to cap technology-based treatment standards with the risk-
based exit levels established according to the multi-pathway risk analysis.
Finally, the rule contains EPA's tentative response to a petition for rulemaking submitted by
the Chemical Manufacturer's Association and EPA's tentative response to the recommendations
made by the Dialogue Committee on Hazardous Waste Identification. The committee was
chartered in July 1993 under the Federal Advisory Committee Act (FACA).
In order to obtain the exemption from the RCRA regulations, the claimant must prepare and
follow a sampling and analysis plan that includes all of the constituents in Appendix X to the
proposed rule, unless the claimant can document that a constituent(s) should not be present in
the waste. There are several conditions that must be met in order to assert that a constituent(s)
is not present in a waste. The plan must describe the sampling procedures and locations
sufficient to characterize the entire waste stream for which the exemption is claimed. The plan
also must identify the analytical methods to be used.
In instances where the exit level is capped by analytical detection limits, the claimant must
achieve compliance with all LDR treatment standards, regardless of whether the waste is intended
for land disposal, before the exemption from regulation as a hazardous waste can be obtained.
Prior to managing any waste as exempt, the claimant must send notification of the exemption
claim and a certification that all requirements for the exemption claim have been met to the
Director.
5.4.3 Implications
This rule will add a critical element to the RCRA hazardous program, in that it will provide
a means, other than delisting, for wastes to exit the universe of regulated hazardous wastes. The
rule is self-implementing, but generators making claims regarding wastes must provide
documentation that the wastes meet all exemption criteria. Enforcement staff will use
documentation and certifications to track compliance.
5.5 REVISED HAZARDOUS WASTE COMBUSTION STANDARDS
5.5.1 Status
Settlement agreement requires that by September 20, 1995, EPA must:
• For cement kilns, issue a proposed rule addressing particulate matter, dioxin and furans,
and other standards;
• For incinerators, issue a proposed rule addressing all standards;
• For lightweight aggregate kilns (LWAKs), issue a proposed rule addressing particulate
matter, dioxin and furans, and metals.
Note that the agreement also requires that by December 15, 1998, EPA initiate a rulemaking
for industrial boilers that addresses particulate matter, dioxin and furans, and metals.
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5.5.2 Summary
The proposed rulemaking to upgrade the emissions standards for cement kilns, LWAKs, and
incinerators is a key component of the Agency's Combustion Strategy, which calls for "more
rigorous controls on combustion facilities based on an assessment of available technologies and
current science," including risk assessment methodologies. It is being driven by the settlement
agreement noted above, which resulted from litigation of the 1991 Boilers and Industrial Furnace
regulations.
The proposed rule will be issued pursuant to both RCRA and Clean Air Act (CAA) authority
to avoid duplicative or inconsistent regulations of the same set of facilities. The rule will impose
a national set of technology-based emission standards for incinerators, cement kilns, and LWAKs,
using the maximum achievable control technology (MACT) provisions of the 1990 CAA
Amendments. These standards will address dioxins and furans, heavy metals (mercury, lead,
cadmium, antimony, arsenic, beryllium, and chromium), particulate matter, hydrochloric acid,
chlorine gas, carbon monoxide, and total hydrocarbons. The implementation program envisioned
is a coordinated program for regulating and permitting these hazardous waste units under the
authority of both RCRA and the CAA in a manner that provides broad implementation flexibility
to the states.
MACT-based standards impose maximum achievable control technology on existing facilities,
while new facilities must meet the emissions levels achieved in practice by the "best controlled
similar source." This rule will also implement the enhanced monitoring provisions of the CAA
Amendments, by requiring some continuous emission monitoring (CEM), probably for particulate
matter and HC1/C12, and allowing the use of CEM for other compounds (e.g., metals). In
addition, the Office of Solid Waste will conduct a national risk check on the proposed standards
to demonstrate that such standards meet RCRA's protectiveness standards. This risk check will
allow permits to be issued to RCRA-regulated units because the RCRA protectiveness standard
is satisfied.
5.5.3 Implications
This rule will change the standards applicable to cement kilns, incinerators, and LWAKs, and
has the potential to alter the manner in which permit limits are developed. These potential
changes have implications for permitting these facilities, monitoring compliance, and developing
enforcement actions. Since the proposal appears likely to incorporate to the new standards into
both the air and RCRA programs, implementation may be achieved under the authority of RCRA
or the CAA. This will allow the states to decide which permit writing and
compliance/enforcement resources should be allocated to address each particular facility. By
necessity, however, such an approach places a premium upon inter-program coordination both
at the federal and state level.
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5.6 DEFINITION OF SOLID WASTE
5.6.1 Status
EPA issued a report in September 1994, entitled Re-engineering RCRA for Recycling. The
report proposes tailored management controls for different categories of hazardous waste
recyclers. The agency plans to revise and streamline RCRA requirements for onsite recycling
and to further clarify which materials need full management as RCRA hazardous waste. EPA
plahs to issue a proposed rule in late 1996. Input from states, industry, and environmental groups
will be considered during development of the proposed rule.
5.6.2 Summary
EPA worked with the Association of State and Territorial Solid Waste Management Officials
(ASTSWMO) to develop the above-referenced report. EPA and the states (through ASTSWMO)
have developed a detailed strategy for addressing jurisdictional issues related to recycling and for
streamlining requirements for recycling activities regulated under RCRA. EPA essentially formed
two teams: one focuses primarily on jurisdiction, while the other examines requirements for
recyclers. EPA (HQ and Regions II, V, and IX) and the states plan to:
• Clarify RCRA jurisdiction by determining which recyclable materials are excluded from
RCRA management (those materials destined for more processing rather than disposal,
where recycling resembles manufacturing more than waste management). EPA plans to
clarify/revise generic in-process exclusions that may be applied to several industries, as
well as tailor exclusions for specific industries, such as petroleum refining and mineral
processing.
• Revise current management standards for regulated recycling in such a way that recycling
will be encouraged, but environmental protection maintained. The revised management
standards will be tailored to different kinds of recycling to address the varying practices
and materials associated with different industries.
• Examine implementation needs relating to the new rulemaking, such as training needs,
information management needs, and state authorization issues.
Within this effort, there is a major focus on making the definition of solid waste easier to read
and understand. EPA is considering eliminating the need to classify secondary materials
according to the regulatory definitions (e.g., spent material, byproduct, scrap metal).
5.6.3 Implications
The revisions will encourage recycling, but also will establish more specific details in the
definition of solid waste regulations, an already complicated rule. The regulations should help
to more easily distinguish sham recycling. In addition, most of the options being reviewed
include relaxed requirements for onsite recycling.
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5.7 NEW POLICY FOR SUPPLEMENTAL ENVIRONMENTAL PROJECTS
5.7.1 Status
Interim policy issued on May 3, 1995, from Steven Herman, Assistant Administrator for the
Office of Enforcement and Compliance Assurance; replaces February 12, 1991, Policy on the Use
of Supplemental Environmental Projects in EPA Settlements." This policy is to be used in all
enforcement actions filed after the effective date and in all pending cases in which the
government has not reached agreement in principle with the violator on the specific terms of a
SEP.
5.7.2 Summary
A SEP is an environmentally beneficial project that a violator agrees to undertake in
settlement of an enforcement action, but which the violator is not otherwise legally required to
perform. In other words, the violator already has agreed to correct the violation via some other
means (consent agreement, final order); the SEP provides environmental benefits beyond those
achieved by merely returning to compliance. A violator's motivation in agreeing to conduct a
SEP is the potential for reducing a significant portion of the gravity component of the penalty.
The new policy more clearly defines a SEP, establishes guidelines to ensure that SEPs are
within EPA's legal authority, redefines nexus (relationship of proposed SEP project to the
violation), and adds two categories of projects which may qualify as SEPS. The new policy
provides step-by-step procedures for calculating the cost of a SEP and the percentage of that cost,
based on an evaluation of five factors, which may be applied as a mitigating factor in establishing
an appropriate settlement penalty.
All proposed projects must have adequate nexus. The project must remediate or reduce the
probable overall environmental or public health impacts or risks to which the violation at issue
contributes, or the project must be designed to reduce the likelihood that similar violations will
occur in the future. SEPS are likely to have an adequate nexus if the primary impact of the
project is at the site where the violation occurred or at a different site in the same ecosystem or
within the immediate geographic area (within a 50-mile radius of the site). In addition, a
proposed project must advance at least one of the declared objectives of the environmental
statutes that are the basis of the enforcement action.
EPA or any other federal agency cannot manage or control funds that are set aside for
performance of a SEP. Nor can EPA manage or administer the SEP. EPA may provide
oversight to ensure that the SEP is implemented according to the provisions of the settlement.
Furthermore, the project can not be something that EPA itself is required by its statutes to do.
A project may not provide EPA with additional resources to perform an activity for which
Congress has specifically appropriated funds. For example, if EPA has developed a compliance
assistance brochure, a SEP may not directly or indirectly provide additional resources to revise,
copy, or distribute the brochure. It is also important to note that, because of legal concerns and
the difficulty of ensuring that a third party implements the project as required, performance of
a SEP by a third party is not allowed.
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Finally, the type and scope of each project must be clearly specified in the signed settlement
agreement. In other words, the "what, where, and when" of a project must be detailed in the
settlement agreement.
There are seven categories for SEPs. These include:
• Public Health—Provides diagnostic, preventative and/or remedial components of
human health care which is related to the actual or potential damage to human health
caused by the violation (e.g., medical examinations of potentially affected persons,
epidemiological studies, rehabilitation therapy).
• Pollution Prevention—Reduces the generation of pollution through "source
reduction," i.e., any practice which reduces the amount of any hazardous substance,
pollutant or contaminant entering any waste stream or otherwise being released into
the environment, prior to recycling, treatment, or disposal (e.g., project redesign, raw
material substitution, improvements in inventory control)
• Pollution Reduction—Results in decrease in the amount and/or toxicity of any
hazardous substance, pollutant or contaminant entering any waste stream or otherwise
being released into the environment by an operating business or facility by a means
which does not qualify as "pollution prevention" (e.g., "out-of-process" recycling,
improved control technology)
• Environmental Restoration and Protection—Goes beyond repairing the damage
caused by the violation to enhance the condition of the ecosystem or immediate
geographic area adversely affected (e.g., restoration of a wetland, purchase and
management of a watershed area by the respondent to protect a drinking water
supply)
• Assessments and Audits—Includes pollution prevention assessments, site
assessments, environmental management system audits, and compliance audits, if they
are not otherwise available as injunctive relief. A pollution prevention assessment
is a review of specific processes and operations to determine where there may be
potential opportunities to reduce the use, production, and generation of toxic and
hazardous materials. A site assessment is conducted to identify environmental or
health impacts relating to a site. An environmental management system audit is an
independent evaluation of a party's environmental policies, practices and controls to
identify the need for improvements. An environmental compliance audit is an
independent evaluation of a respondent's compliance status with environmental
requirements; generally compliance audits are acceptable as SEPS only when the
respondent is a small business, because large businesses often routinely conduct
compliance audits as good business practice.
• Environmental Compliance Promotion—Provides training or technical support to
other members of the regulated community to encourage compliance with regulatory
requirements, avoid committing a violation, or encourage facilities to go beyond
compliance by reducing the generation, release or disposal of pollutants beyond legal
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requirements (e.g., seminars, publications for other members of the regulated
community)
• Emergency Planning and Preparedness—Provides assistance to a responsible state
or local emergency response or planning entity (e.g„ computers and software,
HAZMAT equipment, training). These are only available as non-cash assistance and
require that there are EPCRA or CERCLA §103 violations alleged in the complaint.
As mentioned previously, a proposed SEP can be used to mitigate the gravity component of
a respondent's penalty. First, the Agency must follow the penalty policy to calculate the
economic and gravity components of the penalty. Second, EPA calculates the net-present after-
tax cost of the SEP; a recently developed software package, PROJECT, is used to calculate the
cost of the SEP. Finally, EPA must evaluate the benefits to the respondent of the SEP, based
on specific factors to determine what percentage of the net-present after-tax cost will be
considered in determining an appropriate final settlement penalty.
In general, if a settlement includes a SEP, the penalty should recover, at a minimum, the
economic benefit of noncompliance plus 10 percent of the gravity component, or 25 percent of
the gravity component only, whichever is greater. EPA has some discretion with regard to
recovery of economic benefit from municipalities, government agencies, and nonprofit
organizations.
EPA believes that if a project generates a profit, the respondent probably will implement the
project on its own and should not be provided a reduction in the penalty. The PROJECT model
is used to facilitate evaluation of the cost of a proposed SEP. If the PROJECT model reveals
that a project has a negative cost, this means that it represents a positive cash flow to the
respondent. Because the project is profitable to the respondent, the project would not be
acceptable as a SEP. There are three types of costs that may be associated with performance of
a SEP (which are entered into the PROJECT model): capital costs (e.g., equipment, buildings);
one-time nondepreciable costs (e.g., removing contaminated materials, purchasing land,
developing a compliance promotion seminar); and annual operation costs or savings (e.g., labor,
chemicals, water, power, raw materials). In addition, the number of years that annual operation
costs or savings will be expended in performing the SEP must be specified.
After the net present value (cost) of the proposed project is determined, EPA uses five factors
to calculate the percentage by which the gravity component should be mitigated. These factors
include: benefit to the public or environment at large, innovativeness, environmental justice,
multimedia impacts, and pollution prevention. As a general guideline, the final mitigation
percentage should not exceed 80 percent of the SEP cost. For small businesses, government
agencies, and non-profit organizations, this percentage may be set as high as 100 percent. For
any respondent, if the project is a pollution prevention project, the mitigation percentage may be
as high as 100 percent. A lower mitigation percentage may also be appropriate if the government
must allocate significant resources to monitoring and reviewing the implementation of a project.
The stipulated penalty depends on the respondent's/defendant's demonstration of good faith, the
amount of allocated funds SDent, and completion of the project itself.
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If a SEP is not completed satisfactorily, the respondent will be required, pursuant to the terms
of the settlement document, to pay stipulated penalties for its failure. The stipulated penalty
depends on the respondent's/defendant's demonstration of good faith, the amount of allocated
funds spent, and completion of the project itself.
The settlement agreement should accurately and completely describe the SEP, including
descriptions of the actions to be taken by the respondent/defendant, appropriate oversight
methods, responsibilities for costs, and submission of a final report. Any publication of the SEP
or its results by the respondent/defendant should state that the project was undertaken as part of
a settlement of an enforcement action.
5.7.3 Implications
The SEP policy provides a useful tool for respondents and EPA enforcement staff to develop
creative, environmentally-beneficial means for "going beyond compliance." Enforcement staff
must carefully specify conditions and schedules for project implementation in the settlement
agreement.
5.8 AUDIT POLICY
5.8.1 Status
EPA published the Voluntary Environmental Self-Policing and Self-Disclosure Interim Policy
Statement on April 3, 1995. The policy became effective as an interim policy on April 18, 1995,
but commenters were allowed to provide comments until June 2, 1995, to allow for
improvements and refinements in the future.
5.8.2 Summary
The audit policy is an Agency-wide policy aimed at providing incentives for companies that
evaluate their own operations for compliance, then voluntarily disclose and correct violations.
The policy was developed through a nine-month public process that involved representatives from
industry, states, environmental groups, and the general public.
The policy provides incentives to companies that conduct internal self-evaluations and
voluntarily disclose and promptly correct violations. The interim policy defines voluntary
disclosure as those violations not required to be reported by law. In some cases, companies may
be required to sign a compliance agreement to correct all violations as expeditiously as possible.
The policy includes seven conditions for reducing civil penalties
In return for voluntarily identifying, disclosing, and correcting violations, EPA will eliminate
the gravity component of the penalty. EPA also may reduce the gravity component by up to
75 percent for companies that meet most, but not all, of the seven conditions in the policy. In
addition, EPA will not recommend to the Department of Justice that criminal charges be brought
against companies that meet the conditions for disclosing and correcting violations, as long as
the company has not engaged in a pattern of noncompliance. EPA will continue to recover any
economic benefit that companies have gained from noncompliance.
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The seven conditions for reducing civil penalties and not making criminal referrals include:
1. Voluntary self-policing—Regulated entity discovers a violation through a voluntary
environmental audit or voluntary self-evaluation
2. Voluntary disclosure—Regulated entity fully and voluntarily discloses the violation
in writing to all appropriate federal, state and local agencies as soon as it is
discovered and prior to 1) the commencement of a federal, state, or local agency
inspection, investigation or information request, 2) notice of a citizen suit, 3) legal
complaint by a third party, or 4) the regulated entity's knowledge that the discovery
of the violation by a regulatory agency or third part was imminent
3. Prompt correction—Regulated entity corrects the violation either within 60 days of
discovering the violation, or as expeditiously as possible, if more time is needed
4. Remediation of imminent and substantial endangerment—Regulated entity
expeditiously remedies any condition that has created or may create an imminent and
substantial endangerment to human health or the environment
5. Remediation of harm and prevention of repeat violations—Regulated entity
implements appropriate measures to remedy any environmental harm due to the
violation and to prevent a recurrence of the violation
6. No lack of appropriate preventive measures—The violation does not indicate that
the regulated entity has failed to take appropriate steps to avoid repeat or recurring
violations
7. Cooperation—Regulated entity cooperates as required by EPA and provides such
information as is reasonably necessary and required by EPA to determine the
applicability of the policy
EPA preserves in this policy the discretion to collect the gravity component of the penalty in
appropriate cases. These cases may include instances where a violation involves criminal conduct
or imminent and substantial endangerment. At the same time, EPA has the flexibility to reduce
the gravity element by up to 75 percent for good faith efforts to disclose and promptly comply
even in those cases.
An important component of the policy is that EPA will not request a voluntary environmental
audit report to trigger a civil or criminal investigation. For example, EPA will not request an
audit in routine inspections. Once the Agency has reason to believe a violation has been
committed, EPA may then seek through an investigation or enforcement action any information
relevant to identifying violations.
5.8.3 Implications
EPA will scrutinize enforcement more closely in states with an audit privilege and/or penalty
immunity law. EPA may find it necessary to increase federal enforcement where audit privilege
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and penalty immunity laws prevent a state from obtaining 1) information needed to establish
criminal liability, 2) facts needed to establish the nature and extent of a violation, 3) appropriate
penalties for imminent and substantial endangerment or from recovering economic benefit, 4)
appropriate sanctions or penalties for criminal conduct and repeat violations, or 5) prompt
correction of violations, and expeditious remediation of those that involve imminent and
substantial endangerment. EPA will work with states to address any concerns and ensure that
federal requirements are satisfied.
5.9 SMALL BUSINESS POLICY
5.9.1 Status
The Interim Policy on Compliance Incentives for Small Businesses was issued on June 13,
1995, by Steven Herman, Assistant Administrator for the Office of Enforcement and Compliance
Assurance. The interim policy became effective the day it was issued. It will be finalized after
receipt and consideration of public comments. The policy supplements but does not supplant the
August 12, 1994, Enforcement Response Policy for Treatment of Information Obtained Through
Clean Air Act Section 507 Small Business Assistance Programs.
5.9.2 Summary
The policy is one of the 25 regulatory reform initiatives announced by President Clinton on
March 16, 1995, and implements in part, the Executive Memorandum on Regulatory Reform
(60 FR 20621; April 26, 1995). According to the policy, EPA will exercise its discretion, under
applicable media-specific policies (e.g., RCRA Civil Penalty Policy), to refrain from initiating
an enforcement action seeking civil penalties, or to mitigate civil penalties, whenever a small
business makes a good faith effort to comply with environmental requirements and where there
is no criminal behavior and no significant health, safety or environmental threat. In addition,
EPA is creating special incentives for small businesses who take the initiative to identify and
correct environmental violations by requesting compliance assistance pursuant to the five criteria
identified below.
This policy builds upon the foundation provided in the Clean Air Act Amendments of 1990,
which require that states establish Small Business Assistance Programs (SBAPs) to provide
technical and environmental compliance assistance to stationary sources. In August of 1994,
EPA's air enforcement program issued a policy which provided that an authorized or delegated
state program may, consistent with federal requirements, either: 1) assess no penalties against
small businesses that voluntarily seek compliance assistance and correct any revealed violations
within a limited period of time, or 2) keep confidential information that identifies the names and
locations of specific small businesses with violations revealed through compliance assistance,
where the SBAP is independent of the state enforcement program. With this new June 1995
small business policy, the Agency is adopting a similar policy for water, toxics, hazardous waste,
and other media programs.
This policy applies to facilities owned by small businesses. A small business is a person,
corporation, partnership, or other entity who employs 100 or fewer individuals (on a company-
wide basis). The policy applies to all civil judicial and administrative enforcement actions taken
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under the authority of EPA's environmental programs, except for corrective action programs and
the Public Water System Supervision Program under the Safe Drinking Water Act. This policy
is to be used for settlement purposes and is not intended for use in pleading or at hearing or trial.
The criteria for eliminating or mitigating the settlement penalty against small businesses are:
1. The small business has made a good faith effort to comply with applicable environmental
requirements as demonstrated by receiving compliance assistance from a non-confidential
government or government-supported program that offers services to small businesses
(such as a SBAP or state university), and the violations are detected during compliance
assistance.
2. This is the small business's first violation of this requirement (has not received warning
letter, notice of violation, field citation, etc., within the past 5 years for that requirement).
The policy does not apply if the facility has a history of violations over the past 5 years,
even if this is the first violation of this particular requirement.
3. The policy does not apply if the violation has caused actual serious harm to public health,
safety, or the environment, or the violation may present an imminent and substantial
endangerment, or the violation presents a significant health, safety or environmental
threat.
4. The violation does not involve criminal conduct.
5. The business corrects the violation within the corrections period set forth in the policy.
Small businesses may take up to 90 days following detection to correct the violation, or to
take substantial steps to correct the violations (e.g., apply tor permits, secure financing). For
violations that cannot be corrected within 90 days, the correction period may be extended for an
additional 90-day period, but the business must enter into a written agreement that establishes
a schedule. The schedule may extend for an additional 180 days (i.e., up to 1 year from the date
of detection) if necessary, where the small business corrects the violation by implementing
pollution prevention measures. Any corrections period longer than 180 days should be
incorporated into an enforceable order.
EPA will exercise its enforcement discretion to eliminate or mitigate civil settlement penalties
as follows:
1. EPA will eliminate the civil settlement penalty if a small business satisfies all five of the
criteria listed above.
2. If a business meets all five criteria, but needs a longer corrections period than provided
by criterion 5, EPA will waive up to 100 percent of the gravity component, but may seek
the full amount of economic benefit.
3. If a small business has not met all the criteria above, but has otherwise made a good faith
effort to comply, EPA has discretion to refrain from filing an enforcement action seeking
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civil penalties or to mitigate its demand for penalties to the maximum extent appropriate
(policies generally recognize good faith efforts, where there is a documented inability to
pay) under the appropriate penalty policy (e.g., RCPP).
Violations detected through federal, state, or local enforcement inspections remain fully
enforceable. In addition, a business is subject to all applicable enforcement response policies for
all violations that had been detected through compliance assistance and were not remedied within
the corrections period. Finally, the policy does not limit EPA or a state's discretion to use
information on violations revealed through compliance assistance as evidence in subsequent
enforcement actions.
EPA will defer to state actions in delegated or approved programs that are generally consistent
with the guidelines set forth in the policy. Furthermore, EPA does not require SBAPs to provide
to EPA the names of specific violating businesses that were identified during compliance
assistance efforts. EPA recommends, however, that whenever an agency provides a corrections
period to a small business, the agency should inform the appropriate EPA Region or state of its
action, to ensure that federal and state responses are consistent.
5.9.3 Implications
Enforcement case development officers will need to pay particular attention to the structure
and size of companies to ensure that policy is applied only to "small businesses" that meet the
criteria set forth in the policy. Furthermore, EPA will need to confirm that state policies
concerning compliance assistance programs and subsequent enforcement actions are consistent
with the federal policy.
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
6. STATE/FEDERAL LEGAL RESPONSIBILITIES IN
RCRA ENFORCEMENT
c/EPA
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RCRA Practitioners Enforcement Workshop State/Federal Enforcement Responsibilities
Module 6 Objectives
• Discuss State authorization under RCRA and
its effect on RCRA enforcement
• Become familiar with the authorization
process
• Differentiate EPA's responsibilities in
unauthorized states and authorized states for
both base program requirements and HSWA
revisions
• Discuss state and EPA enforcement
responsibilities
Notes:
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RCRA Practitioners Enforcement Workshop State/Federal Enforcement Responsibilities
State Authorization Process
• State program must be comparable to federal
program:
- Consistent with the federal program and
programs in other states
- Statutes and regulations equivalent in stringency
- Adequate enforcement
- Public access to information
- State must submit application for authorization
(40 CFR 271)
Notes:
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State Authorization Process
• Application must include the following
elements:
- Governor's request for program approval
- Applicable state statutes and regulations
- Documentation of public participation
- Program description
- Attorney General's statement
- Memorandum of Agreement
Notes:
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RCRA Practitioners Enforcement Workshop State/Federal Enforcement Responsibilities
State Authorization Process
Program description details the contents of
state hazardous waste program, including:
Procedures
State Organization
Size of
Regulated
Universe
Monitoring and
Enforcement
Funding
Forms
Notes:
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RCRA Practitioners Enforcement Workshop State/Federal Enforcement Responsibilities
State Authorization Process
• Attorney General's Statement
- A written statement demonstrating that state laws
provide adequate authority to carry out the
program.
- The statement includes references to statutes,
regulations, and judicial decisions.
Notes:
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RCJRA Practitioners Enforcement Workshop State/Federal Enforcement Responsibilities
State Authorization Process
• Memorandum of Agreement
- Although authorized state assumes primary
responsibility, EPA retains some responsibilities
and oversight powers
- Outlines responsibilities, oversight powers, and
level of coordination
- Must be consistent with annual state/EPA
agreement and program grants
Notes:
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RCRA Practitioners Enforcement Workshop State/Federal Enforcement Responsibilities
State Authorization Process
• Before approving an application, the
Administrator must be satisfied that the state
program:
4/j Is equivalent to and no less stringent than the
federal program
--- Is consistent with the federal program
Lf Is enforceable.
Notes:
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State Authorization Process
• Once approved by EPA, federal
requirements are superseded by state
requirements.
• After approval, state programs may be:
- Withdrawn
- Voluntarily transferred back to EPA
- Revised: Initiated by state or required by EPA.
Notes:
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Base Program Authorization
Highlighted states are not authorized for
Base Program
Virgin Islands, American Samoa, Northern
Marianna Islands, and Puerto Rico are also
not authorized for Base Program
Notes:
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RCRA Practitioners Enforcement Workshop State/Federal Enforcement Responsibilities
State Authorization Process
• State program revisions: Authorization is
dynamic.
• When new, more stringent federal
requirements are promulgated, state is
required to revise program within:
- 1 year if no statutory changes are required or
- 2 years if statutory changes are necessary.
• States are not required to adopt new federal
requirements that are less stringent than
existing federal or state requirements.
Notes:
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RCRA Practitioners Enforcement Workshop State/Federal Enforcement Responsibilities
HSWA Authorization
• Pre-HSWA—changes take effect when
adopted by state
• HSWA requirements take effect in
authorized states at same time as in
nonauthorized states.
• EPA implements HSWA requirements in
authorized states until the state is authorized.
Notes:
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HSWA Authorization (Continued)
• EPA may allow state to assist in HSWA
implementation prior to authorization.
• Once authorized, state law supersedes federal
HSWA requirements.
• Non-HSWA requirements remain
unenforceable in authorized states until
adopted and authorized.
Notes:
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Non-HSWA Authorization Example
• Permit Modification Rule
- Rulemaking revising 40 CFR 270.42, the
procedures for modifying permits
- Rule not required by HSWA; not immediately
effective in authorized states
- Changes made procedures "less stringent"; states
not required to adopt rule
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Non-HSWA Program Authorization Example
• Mixed Waste Regulation
- Clarified scope of EPA regulation of "mixed"
radioactive/hazardous waste in 1986
- Qarification not required by HSWA and not
immediately effective in authorized states
- Scope of federal program was increased; states
required to adopt change
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HSWA Authorization Example
• HSWA required rules regulating BIFs
• EPA promulgated BIF rule under HSWA;
effective 1991
• BIF rule immediately effective in states on its
effective date; enforced by EPA
• Once state adopts BIF rule, state can assist
enforcement (e.g., inspections and
enforcement under state law)
• Once state authorized for BIF, state leads
enforcement
Notes:
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HSWA Authorization Example
• Corrective Action
- HSWA requires RCRA permits to include
corrective action provisions for SWMUs.
- SWMU corrective action is more stringent and
required to be adopted by authorized states.
- Revises pre-HSWA permitting rule; responsibility
divided prior to state HSWA authorization:
—State: Regulated units
-EPA: SMWUs.
Notes:
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HSWA Authorization Example
Toxicity Characteristics (TC) Rule
• Adds new constituents to the TC; revises test
for determining toxicity (TCLP)
• Required by HSWA; nationally effective
• Broadens federal scope; states must adopt
• Revises pre-HSWA rule; divides
responsibility prior to state HSWA
authorization
- State: EP wastes
- EPA: TC wastes
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HSWA Authorization
• Each RCRA rulemaking explains whether
new rule is a HSWA or a base program
revision
• Requirements imposed pursuant to HSWA:
Table 1, 40 CFR 271.iQ)
• Self-implementing HSWA provisions: Table
2, 40 CFR 271.l(j)
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EPA Enforcement
• Non-HSWA requirements
- Not enforceable in authorized state until adopted,
then enforceable by the state as state law
- Once state is authorized, federally enforceable
- Federally enforceable in nonauthorized states
• HSWA requirements
- Federally enforceable in authorized and
nonauthorized states
- Enforced as state law in authorized state when
adopted and authorized
Notes:
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EPA Enforcement
• EPA retains federal HSWA and non-HSWA
enforcement authority even in authorized
states (through MOA and overfiling)
Notes:
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\
EPA Enforcement
• EPA may enforce all aspects of approved
state program, including more stringent
requirements.
- More stringent: Requirements affecting same
facilities regulated under federal program but
subjecting them to additional or more stringent
requirements.
• EPA may not enforce any aspect of an
authorized state program that is not
approved or is broader in scope.
- Broader in scope: Regulates facilities not
included under federal program.
Notes:
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Proposals for Change
• Expedited state authorization process in
proposed rules:
- Draft Contaminated Media Rule
- Draft Land Disposal Restrictions Phase IV Rule
• National Environmental Performance
Partnership System
Notes:
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WilsonJones* Quick Reference Index System © 1991 Wilson Jones Company
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
6. STATE/FEDERAL LEGAL RESPONSIBILITIES IN
RCRA ENFORCEMENT
Background Materials
&EPA
•??
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INSTRUCTOR NOTES
RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
6. STATE/FEDERAL LEGAL RESPONSIBILITIES IN RCRA ENFORCEMENT
Time: 1 hour and 15 minutes
Objectives:
¦ Discuss concept of state authorization.
¦ Provide an overview of the authorization process.
¦ Differentiate EPA's responsibilities in unauthorized states and authorized states for both
base program requirements and HSWA revisions.
¦ Discuss state and EPA enforcement responsibilities.
Emphasis:
¦ Understand the delineation of responsibility between the states and EPA in enforcing
RCRA.
Helpful Hint:
¦ The exercise should be used as a forum for open exchange of ideas and approaches.
Students should be given 10 minutes to think about their responses to the different
scenarios. The remaining 20 minutes should be used for discussion.
Bibliography:
U.S. Environmental Protection Agency (EPA). 1993 (March). RCRA Practitioners
Enforcement Workshop: Course Materials.
EPA. No date. RCRA Inspector Institute: Inspector's Addendum.
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6. STATE/FEDERAL LEGAL RESPONSIBILITIES IN RCRA ENFORCEMENT
6.1 INTRODUCTION
The Resource Conservation and Recovery Act (RCRA) program is administered primarily
by authorized state agencies that have been delegated both permitting and enforcement authority
under Section 3006 of RCRA, 42 U.S.C. § 6926. However, the U.S. Environmental Protection
Agency (EPA) retains oversight and enforcement responsibilities in authorized states.
EPA's role in the enforcement process in an authorized state varies depending on the
requirement being enforced and its statutory source (i.e., depending on whether the requirement
is imposed under the authority of the Hazardous and Solid Waste Amendments of 1984 [HSWA]
or not). In this scheme, to sort out the overlapping federal and state enforcement roles, the state
authorization process must be understood, as well as the statutory source for the requirements
enforced by the agencies.
The purpose of this module is to lay the framework for understanding RCRA state
authorization and its effect on RCRA enforcement.
6.2 STATE AUTHORIZATION
Most of the states in the nation have been delegated the authority to implement the base
RCRA program "in lieu of" the federal program. This base program authorization provides the
authority essential to implement the RCRA program, both in permitting and enforcement.
In order to obtain base program authorization under Section 3006(b) of RCRA, a state must
establish that its program:
• Is equivalent to the federal program (i.e., at least as stringent and broad in scope as the
federal program)
• Is consistent with the federal program and the programs applicable in other states
• Provides adequate enforcement.
6.2.1 State Authorization Application
Any state that seeks authorization for its hazardous waste program must submit an
application to EPA for review and approval. The standards and requirements for authorization
are found in 40 CFR Part 271.
The application submitted by the state must include the following elements:
• A letter from the Governor requesting program approval (40 CFR 271.5)
• Copies of applicable state statutes and regulations (40 CFR 271.5)
• Documentation of public participation activities (40 CFR 271.5)
• Program description (40 CFR 271.6)
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• Attorney General's statement (40 CFR 271.7)
• Memorandum of Agreement (40 CFR 271.8).
The first three elements are self-explanatory, the following discussion focuses on the
contents of the program description, Attorney General's statement, and Memorandum of
Agreement.
Program Description (40 CFR 271.6)
The program description is an important element of the state authorization application. The
program description provides the details df the hazardous waste program that the state proposes
to administer in place of the federal program. Contents of the program description include:
• State organization for implementing the program (e.g., which agency will be responsible
for implementing the program, how many staff members are available, how will staff be
trained, will coordination be required with other agencies, how coordination will be
achieved?)
• Monitoring and enforcement program (e.g., how will violators be identified, how will
violations be classified, how will inspections be targeted?)
• Procedures (e.g., permitting, administrative, judicial)
• Costs for implementing program and available funding
• Size of regulated universe (i.e., generators, transporters, disposal facilities)
• Copies of permit forms, application forms, and reporting forms to be used by the state.
Attorney General's Statement (40 CFR 271.7)
A state seeking to assume the responsibility for RCRA implementation must demonstrate
that the laws of the state provide adequate authority to carry out all aspects of the state program.
This demonstration is made in the form of a statement from the state's Attorney General on a
state agency's independent counsel. The statement includes references to the statutes, regulations,
and judicial decisions that the state relies on in administering its program.
Memorandum of Agreement (40 CFR 271.8)
Although a state with an authorized program assumes primary responsibility for
administering RCRA, EPA still retains some responsibilities and oversight powers. The
memorandum of agreement (MOA) between the state and EPA outlines the nature of these
responsibilities and oversight powers, and the level of coordination between the state and EPA
in operating the program.
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The MOA includes provisions for:
• Specifying frequency and content of reports that the state must submit to EPA.
• Coordinating compliance monitoring and enforcement activities between the state and.
EPA.
• Joint processing of permits for those facilities that require a permit from both the state
and EPA under different programs.
• Specifying the types of permit applications that will be sent to EPA for review and
comment.
The MOA is a dynamic instrument to coordinate activities and identify cooperative
understandings between the state and EPA, which change over time. The MOA also must be
consistent with annual state/EPA agreement and program grants. The annual state/EPA
agreement cannot override the MOA, therefore, the MOA may require amending if the two
documents are not in agreement.
6.2.2 State Program Approval (40 CFR 271.20 - 271.23)
Before approving an application, the Administrator must be satisfied that the state program:
• Is equivalent to and no less stringent than the federal program. The state program must
adopt regulatory and statutory requirements that are at least equivalent to (Section
3006(b)), and no less stringent than (Section 3009), those implemented and enforced
under the Subtitle C program at the federal level. This does not mean that the state
program cannot differ from the federal program; it can be more stringent and/or extensive
than the federal program.
The state program must:
- Control all the hazardous wastes regulated under 40 CFR Part 261 and adopt a list of
hazardous wastes and a set of characteristics for identifying hazardous waste. The
state is not required to have a delisting mechanism, though it may be authorized for
delisting if the state so chooses. (40 CFR 271.9)
- Cover all generators, transporters, and TSDs covered by the respective 40 CFR
regulations and provide standards equivalent to those in 40 CFR. (40 CFR 271.10)
- Use the federal manifest format. (40 CFR 271.10)
- Require permits for facilities required to obtain a permit under 40 CFR Part 270 and
prohibit the operation of any hazardous waste management facility without a permit
or interim status. (40 CFR 271.13)
- Have legal authority to implement permitting procedures. (40 CFR 271.14)
• Is consistent with the federal program and other authorized state programs (Section
3006(b)). For example, the state program must not 1) impede, restrict, or ban free
movement of hazardous waste across state borders, 2) prohibit management (treatment,
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storage, or disposal) of hazardous waste without basis in human health or environmental
protection, and 3) use alternative state manifest system. (40 CFR 271.4)
• Is enforceable. RCRA requires that state programs contain adequate authority to monitor
and enforce all the requirements developed under Subtitle C. Required monitoring
provisions include procedures to evaluate information submitted by facilities for possible
enforcement, inspection procedures, access authority, and information gathering
procedures to ensure admissibility of evidence in court. Required enforcement provisions
include injunctive relief, civil penalty authorities, criminal remedies, and public
participation in enforcement. (40 CFR 271.15 - 271.16)
• Provides for availability of information. States must make information available to public
and EPA to the same extent as under federal law. (40 CFR 271.17)
As part of the approval process, the state is required to give public notice and take comment
prior to submitting an application for EPA approval. After receipt of the state's complete
application, EPA has 90 days to make a tentative decision whether or not to grant authorization
to the state program. The tentative determination is published in the Federal Register and a
public hearing is held. The public is allowed 30 days for comment. (40 CFR 271.20)
Within 90 days of the Federal Register notice, EPA is required to make a final
determination taking into account any comments submitted. The final determination also is
published in the Federal Register.
After approval, state programs may be:
• Withdrawn. Approved state programs are continually subject to review. If EPA
determines that a state program no longer complies with the appropriate regulatory
requirements, program approval may be withdrawn. For example, failure to issue permits
that conform to regulatory requirements, failure to inspect and monitor activities subject
to regulation, failure to comply with the terms of the MOA, or failure to take appropriate
enforcement action are reasons that EPA may withdraw a program. (40 CFR 271.22 -
271.23)
• Voluntarily transferred back to EPA. In some cases, states with approved programs may
voluntarily transfer the program back to EPA (e.g., financial reasons). Prior to
transferring responsibilities back to EPA, the state must provide notice to EPA and EPA
must provide notice to affected parties. (40 CFR 271.23)
6.2.3 State Program Revision (40 CFR 271.21)
Once a state has obtained base program authorization, the authorization process does not
end. Program revisions may be initiated by the state or required as a result of changes in the
federal program.
As federal statutory or regulatory authority is modified or supplemented, revision of the
state program is often necessary. Authorized states are required to modify their programs to
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adopt those new federal requirements that are more stringent or broader in scope than the prior
requirements and to apply for authorization to enforce the new requirements through state
program revision applications.
When the federal requirements change, authorized states have 1 to 2 years to modify their
programs, depending on whether state statutory amendments are required. However, the deadline
can be extended upon a showing that the state has made a good faith effort to meet the deadline
but was unable to do so.
If a state revises its program, it must notify EPA and submit modified application
documents. In reviewing the proposed modifications, EPA applies the same standards used in
reviewing the state's initial base, program application. The revisions become effective upon
approval of EPA, following public notice and comment.
In this system, the delegation process is incremental* and the elements of the program for
which a state is authorized frequently change.
6.3 APPLICABLE REQUIREMENTS
The changing nature of the RCRA program complicates tne determination of what
requirements apply to a facility, as well as which agency may enforce the requirements. The
question is relatively easy to answer in the few states not yet authorized to implement RCRA.
In unauthorized states, the federal requirements apply and are fully enforceable by EPA. As new
requirements are promulgated, they are immediately federally enforceable on their effective date.
In an authorized state, however, a facility is subject to requirements for which the state is
authorized under RCRA, as well as requirements that the state has adopted but for which it is not
yet authorized. These state-adopted but not yet federally authorized requirements are enforceable
by the state agency as a matter of law.
In addition to the requirements adopted and imposed by the authorized state, a facility may
also be subject to newly promulgated federal RCRA regulations that have not yet been adopted
by the state. Certain newly promulgated federal requirements are directly enforceable by EPA
on the federal effective date, while others are not enforceable until adopted by the authorized
state: Whether a piarticular requirement is federally enforceable prior to state authorization is
determined by whether or not the requirement was promulgated pursuant to the HSWA, P.L. 98-
616.
When RCRA was amended by HSWA, Congress altered the manner in which new
requirements take effect in authorized states. Prior to HSWA, changes in the federal program
did not take effect in an authorized state until the state program was revised. With the addition
of Section 3006(g) in 1984, new requirements imposed pursuant to the authority of HSWA are
immediately applicable in authorized states upon the federal effective date.
Each authorized state is still required to adopt new HSWA requirements, but until it does
so, those requirements are enforceable by EPA as a matter of federal law. Newly promulgated
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requirements that are not imposed pursuant to HSWA remain unenforceable in an authorized state
until adopted by the state.
It is not immediately apparent which regulations are adopted pursuant to HSWA and which
are non-HSWA requirements. Generally, the best way to determine the statutory basis of the
requirement is to review the preamble to the federal rulemaking, which appears in the Federal
Register notice announcing the final promulgation of the rule. Each preamble discusses whether
or not a requirement is adopted pursuant to HSWA and sets out the effective date and federal
enforceability of each requirement in light of its HSWA or non-HSWA status. Regulatory
requirements imposed pursuant to HSWA are also set out in Tables 1 and 2 of 20 CFR §
271.10).
6.4 FEDERAL ENFORCEMENT IN AN AUTHORIZED STATE
EPA has consistently maintained that it retains the authority to take enforcement action in
an authorized state, not only to enforce HSWA requirements, but to enforce violations of the
requirements of the authorized state program. With one recent exception, where the Agency's
authority has been challenged, EPA has prevailed.1
This authority is recognized in the MOA under which each authorized state program and
EPA operate. Where EPA takes action in an authorized state, it must give prior notice to the
state, both under the terms of the MOA and under Section 3008(a)(2) of RCRA, 42 U.S.C.
6928(a)(2).
The most common situation in which EPA takes action in an authorized state is one in
which EPA is enforcing HSWA requirements. For example, the state may have taken action on
base program violations, such as the operation of a landfill without a permit or interim status.
However, the same conduct by the facility may violate the land disposal restrictions, which are
imposed pursuant to HSWA. If the state has not yet adopted the land disposal restrictions, EPA
is likely to bring its own independent enforcement action to enforce those requirements.
The Agency is not precluded from enforcing the HSWA requirements, even where there
may have been a final resolution of the state base program action. In these circumstances, EPA
is clearly not estopped from enforcing requirements, which are distinct from those imposed by
the state in its action. See In the Matter of Cypress Aviation, Inc., and the City of Lakeland,
RCRA Docket No. 89-04-R (Initial Decision September 24, 1991), pages 14 through 16.
1. See Wyckofi v. EPA, 796 F.2d 1197, 1199-1201 (9th Cir. 1986) (upholding EPA's authority to issue
orders under Section 3013 of RCRA within an authorized state); United States v. Environmental Waste Control,
Inc., 710 F. Supp. 1172, 1184-1187, 1195-1201 (N.D. Ind. 1989) (discussion of EPA's authority and res judicata
and collateral estoppel defenses); United States v. Environmental Waste Control, Inc., 698 F. Supp. 1422, 1435-
38 (N.D. Ind. 1988); United States v. Rogers, 685 F. Supp. 201, 203 (D. Minn. 1987); United States v.
Conservation Chemical Co. of III., 660 F. Supp. 1236, 1244-1245 (N.D. Ind. 1987); but see In re The Beaumont
Company, Docket No. RCRA-III-238 (October 20, 1994) (ALJ's decision that federal action is partially barred
under doctrine of res judicata due to prior state adjudication, now on appeal to EAB).
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Apart from the direct enforcement of HSWA requirements, as a matter of enforcement
discretion, EPA's authority to take action in an authorized state is exercised in limited
circumstances. Under the MOA with the state, EPA may take the enforcement lead at the request
of the state (e.g., where facilities have repeatedly frustrated state enforcement efforts).
Similarly, on its own initiative or at the request of a state, EPA may take the enforcement
lead in cases that may establish national precedent or in cases that are otherwise of regional or
national significance (e.g., where coordinated action is needed to address violations committed
by a company operating in more than one state).
EPA may also take action where it determines that the state has failed to take timely and
appropriate enforcement action. This is the situation generally referred to as "overfiling."
EPA's authority to act in this circumstance is again recognized in the MOA under which
EPA and each state operate. EPA may choose to act where the state has not obtained an
adequate penalty or, more importantly, where EPA is not satisfied that adequate compliance has
been obtained. Contra In re The Beaumont Company Docket No. RCRA-HI-238 (October 20,
1994) (on appeal to the Environmental Appeals Board).
Cases overfiled based upon a finding that a state failed to take timely and appropriate action
are far less common than federal actions taken in cooperation with the state. However, overfiled
cases generate controversy out of proportion to their numbers.
EPA may enforce as federal requirements all aspects of an approved state program,
including more stringent requirements. Requirements that are considered more stringent are those
that affect the same facilities regulated under the federal program but subject them to additional
or more stringent requirements.
EPA may not enforce any aspect of an authorized state program that is not approved or is
broader in scope. Requirements that are considered broader in scope are those that regulate
facilities or wastes not included under the federal program.
6.5 PROPOSED CHANGES
There are several proposals to change the state authorization process and the state/federal
relationship. First, two proposed rulemakings would expedite the state authorization process,
relying to some degree on certification by the state Attorney General. These include:
• Draft Contaminated Media Rule—Proposes an expedited approval process, with after-
the-fact review of implementation.
• Draft Land Disposal Restrictions Phase IV Rule—Proposes to add new streamlined
procedure for state program approval for less significant changes under Phases EI, HI, and
IV.
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The National Environmental Performance Partnership System also proposes changes to the
state/federal relationship. This May 17, 1995, agreement aims to scale back federal oversight of
state environmental programs in all media.
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State/Federal Relationship Problem Set
Rett Nelson
Scene 1(a)
You are a U.S. EPA staff attorney who has just been assigned a new RCRA administrative
enforcement action. The draft complaint just showed up in your mailbox, and the RCRA
enforcement specialist has already left two messages in your voice mail "in-box" asking about
the status of ypur review (it is getting near to the end of the quarter). You have leafed through
the complaint. The first thing you notice is a lot of citations to state regulations in the findings
of violation part of the complaint. You are concerned, because you barely know the federal
regulations, let alone the state regulations. You return the enforcement specialist's call; you ask
to see her file on the case, and promise to get back to her the next day.
The violation seems to stem from the facility's failure to provide financial assurance for closure.
Factually, there doesn't seem to be any question that the violation occurred. The facility
admitted in a letter that it did not comply with 40 CFR §265.143. But the facility is located in
a state whose program was "authorized" after the date of the facility's admission.
You look up 40 CFR §265.143. It allows the facility to choose from five options in meeting the
financial assurance requirement: closure trust fund, surety bond guaranteeing payment to a
closure trust fund, closure letter of credit, closure insurance, and financial test and corporate
guarantee for closure.
You look up the current state regulations. It only allows 2 of the 5 options (surety bond and
letter of credit), but is otherwise similar to the federal regulation.
You want penalties for past violations and compliance with the current regulations. What
regulations do you cite? Any enforcement problems?
Scene 1(b)
Same situation. The state regulations also include several waste codes that are not included in
the federal program. Your draft complaint includes references to these waste codes in the
findings of violation.
Should you include those waste codes in your complaint?
Scene II
Two years later. You filed your administrative complaint, citing the proper regulations in the
complaint. Respondent has come into compliance by obtaining a surety bond, but you are still
arguing over the penalty amount. Because you were so thorough in the initial filing of the
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compliant, Respondent's attorneys never raised a state authorization issue in their answer or in
any subsequent discussions.
At this point, the state's pending application to revise its approved regulations, including the
financial assurance regulations, is approved by U.S. EPA. Now four of the five financial
assurance options (all but the financial test) are available to the facility.
Any enforcement problem?
Scene III
Six months later. You sign a Consent Agreement and Final Order (CAFO) with the Respondent.
The CAFO requires the Respondent to provide financial assurances and to pay a penalty. After
the CAFO is signed, the state enacts a wholesale revision to the current state program, revoking
all previous state hazardous waste statutes and regulations. U.S. EPA has not yet approved the
state revision. Following the state action you receive word that the Respondent has allowed its
surety bond to lapse. Respondent is thus in violation again.
You are hopping mad. The state is even angrier, though, and insists on taking action right away.
The usual U.S. EPA practice is to refer CAFO violations to the Department of Justice to seek
enforcement of the terms of the CAFO.
What do you do?
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
7. RCRA PERMITS:
RELATIONSHIP TO ENFORCEMENT
&EPA
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RCRA Practitioners Enforcement Workshop RCRA Permits: Relationship to Enforcement
Module 7 Objectives
• Understand procedures for conducting
inspection of permitted facility
• Examine need for coordination between the
permit writer and the compliance/
enforcement staff
• Review State/EPA relationship in the
permitting process and how it effects
enforcement
Notes:
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RCRA Practitioners Enforcement Workshop RCRA Permits: Relationship to Enforcement
Permits
Permits identify administrative and technical
performance standards.
After issuance, attention focuses on tracking
compliance and enforcing permit conditions.
Notes:
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Permitted Facility Inspections
Pre-Inspection Activities
• Define scope of inspection
• Discuss facility with permit writer
• Review documents
Notes:
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Permitted Facility Inspections
• Document Review:
— Permit
— Site-specific conditions
— Referenced attachments
— Organize permit information
Notes:
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RCRA Practitioners Enforcement Workshop RCRA Permits: Relationship to Enforcement
Permitted Facility Inspections
• Document Review (continued):
- Administrative orders and consent decrees
- New RCRA regulations
- Other: Inspection reports, relevant guidance
materials, and past communications between
facility and EPA
• Past inspection reports identify problem
areas
Notes:
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Permit Enforcement
• Actions During Permitting Process
- Notice of Violation
- Notice of Deficiency
Notes:
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Permit Enforcement
• Enforcement Actions at Permitted Facility
- Informal Action
- Notice of Violation
• EPA or state may issue NOV
Notes:
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Permit Enforcement
• Enforcement Actions at Permitted Facility
(continued)
- Formal Action
—Administrative action
—Civil action
—Criminal action
Notes:
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Permit Enforcement
Enforcement Strategy
• EPA policies and guidelines
• Threshold requirements
• Other factors (e.g., case history, desired
remedy)
• Special procedures for parallel proceedings
Notes:
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Team Approach
Permit Writer and Compliance/Enforcement Staff
•Permit Application Review
•Permitted Facility Inspection
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RCRA Practitioners Enforcement Workshop RCRA Permits: Relationship to Enforcement
Team Effort (continued)
Other EPA Personnel
State Personnel
- Dual Permit
- Inspection
Notes:
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c ^
Corrective Action Cases
• Corrective Action Tools
- Permit
- Enforcement Action
Notes:
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WilsonJones. Quick Reference Index System
© 1991 Wilson Jones Company
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
7. RCRA PERMITS:
RELATIONSHIP TO ENFORCEMENT
Background Materials
-------
INSTRUCTOR NOTES
RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
7. RCRA PERMITS:
RELATIONSHIP TO ENFORCEMENT
Time: 1.5 to 2 hours
Objectives:
¦ Delineate procedures for conducting inspection of permitted facility.
¦ Present need for coordination between permit writer and compliance/enforcement staff in
reviewing permit and monitoring compliance of permitted facility.
¦ Discuss state/EPA relationship in permit process and compliance monitoring/enforcement.
Emphases:
¦ Permit as key enforcement tool
¦ Value of team approach
Helpful Hints:
¦ The text is very generic. It may be useful to develop region-specific examples to illustrate
the concepts presented in the text.
¦ Additional information on permitted facility inspections is presented in the RCRA Inspection
Manual and the RCRA Technical Case Development Guidance Document.
Bibliography:
U.S. Environmental Protection Agency (EPA). 1993 (March). RCRA Practitioners Enforcement
Workshop: Course Materials.
EPA. No date. RCRA Inspector Institute: Inspector's Addendum.
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7. RCRA PERMITS:
RELATIONSHIP TO ENFORCEMENT
7.1 INTRODUCTION
Permits identify facility-specific administrative and technical performance standards. The
permit is the key to implementing and enforcing the regulations established under Resource
Conservation and Recovery Act (RCRA) Subtitle C.
The permit process consists of five steps:
1. Submitting the permit application
2. Conducting an administrative review of the permit application
3. Preparing the draft permit
4. Taking public comments and finalizing the permit
5. Modifying, maintaining, and terminating the permit.
RCRA permits can be issued by the U.S. Environmental Protection Agency (EPA) or an
authorized state. In many instances, it is issued by both parties—the state issuing the permit for
pre-Hazardous and Solid Waste Amendments (HSWA) provisions and EPA issuing the portion
of the permit addressing HSWA provisions. The joint role of EPA and states in issuing permits
will continue until the state is authorized to implement HSWA.
After the permit is issued, attention is focused on tracking compliance with the technical
and administrative requirements defined in the permit and enforcing the permit provisions.
Periodically, each facility is inspected to determine whether it has altered its operation or is
noncompliant with permit conditions. Operational modifications or failure to comply with
permitting requirements can result in:
• Issuance of an enforcement action, to bring the facility into compliance with the permit
conditions
• Changes to the facility's permit status, including:
- Modification of permit conditions
- Revocation and reissuance of the permit
- Termination of the permit.
7.2 PERMITTED FACILITY INSPECTIONS
Section 3007(a) of RCRA authorizes EPA to inspect any facility that handles hazardous
waste for the purpose of regulatory development or enforcement of RCRA. The purpose of an
inspection is to ascertain the compliance status of a facility, the extent of any noncompliance, and
the potential for or extent of any release. An inspection may be conducted to address a specific
enforcement concern or be part of EPA's routine compliance/oversight activities.
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7.2.1 Pre-Inspection Activities
As with any facility inspection, the scope of a permitted facility inspection should be
defined to form a basis for pre-inspection activities. For example, routine compliance inspections
generally will be broader in scope than a review of facility compliance with deadlines in the
RCRA permit and will entail a detailed evaluation of all RCRA-related activities at the facility.
Conversely, the latter will have a much narrower scope and will require less pre-irispection
planning.
Prior to inspecting a permitted facility, the inspector must gather pertinent sources necessary
to become familiar with the site. The first, and perhaps most important source, is the expertise
of other staff members (state and EPA) familiar with the site. Enforcement officials and permit
writers familiar with the permitted facility may assist in determining the major areas of interest
at the facility, such as past compliance problems.
The inspector should be prepared to spend time reviewing pertinent documents. The
documents that need to be reviewed will depend on the focus of the inspection. For a general
compliance inspection at a permitted facility, the inspector should begin by reviewing the permit.
The permit (inclusive of all referenced attachments) contains most of the site-specific
conditions and requirements that a facility must meet to be in compliance. In general, permits
are written to track closely with Part 264 regulations, but the placement of permit conditions may
have been altered depending on the style of the permit writer (e.g., all reporting requirements
may be organized in one section of the permit). If conditions of the facility permit are
inconsistent with the Part 264 regulations, the permit may serve as a shield (i.e., protect the
facility from enforcement actions). The permit may also contain state requirements that are
broader in scope or more stringent than federal requirements. Inspectors are encouraged to
discuss the permit with the permit writer.
The permit may reference the facility's Part A or Part B permit application and incorporate
specific portions by reference. Referenced sections of these documents are then considered
enforceable permit conditions. The inspector, therefore, cannot rely solely on the body of the
permit, but must also review the referenced attachments. If the content of the facility permit
differs from the facility's Part A or Part B permit application, the permit takes precedence.
In some cases, facilities have been issued more than one RCRA permit. For example, the
state may have issued one permit and EPA another to cover provisions for which the state lacks
authority (e.g., corrective action for solid waste management units). Under these circumstances,
the EPA permit will cover only the HSWA requirements. Nonetheless, the facility has to comply
with both state and federal requirements. Federal inspectors may coordinate with state inspectors
to conduct a complete review of the facility. The EPA inspector may focus on the HSWA
requirements, while the state inspector addresses the state-imposed requirements.
Due to the voluminous nature of RCRA permits, the inspector should organize the
information contained in the permit into a useful format to facilitate the inspection. For example,
information can be organized into checklists or factsheets. EPA's RCRA Inspection Manual
presents information on the development of checklists and factsheets.
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Other documents that should be reviewed include:
• Administrative orders and consent decrees: Orders and consent decrees contain specific
provisions with which the facility must comply. If inconsistencies arise between the
permit and order/consent decree, the latter takes precedence.
• New RCRA regulations to which the facility may be subject: In some instances, permits
will not have been modified to reflect new regulations. Many regulations are self
implementing, however, and do not require specific permit language to be enforceable
(e.g., land disposal bans). Also, new hazardous waste listings may affect other facility
waste streams, subjecting them to regulation.
• Past inspection reports (these can be particularly useful in identifying problem areas
within a facility), relevant guidance materials, and past communications between EPA
and the facility.
The permit writer or enforcement official should be able to assist the inspector in
determining whether other documents, beyond those contained in the permit, may be useful in
arriving at a complete picture of the facility.
7.2.2 Inspection Procedures
The procedures for conducting the inspection at the permitted facility are the same as for
other facilities. For additional information, refer to the RCRA Inspection Manual.
7.3 PERMIT ENFORCEMENT: WHEN A VIOLATION IS DISCOVERED
Enforcement actions may be used during permit application review and after permit
issuance.
7.3.1 Enforcement Actions During the Permitting Process
In some instances, enforcement action needs to be taken during the permitting process. The
two most common enforcement actions during this process are:
• Notice of violation (NOV), which is sent to a facility owner/operator as notification that
a Part B permit application has not been received within the time frame specified in the
Part B call letter and is used to set a deadline for appropriate response before further
enforcement is pursued
• Notice of deficiency (NOD), which is a specialized form of the NOV that is sent to an
owner/operator to describe and request information that is missing or deficient in a
permit application.
Enforcement staff also may become involved in the permitting process during other
situations, including the following:
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• An unreported unit is discovered during a routine inspection.
• A compliance schedule is developed for a permit.
• An enforcement action is needed in response to a permitting problem (e.g., if an
appropriate response is not received for an NOV or NOD).
7.3.2 Enforcement Actions at a Permitted Facility
Once the permit is issued, requirements for compliance with RCRA are defined.
Enforcement actions may be initiated for noncompliance with any aspect of the permit. Such
actions can be either informal or formal. Note that because the permit identifies the obligations
imposed in the facility and shields the facility from enforcement actions based on other (i.e., non-
permit) requirements, the permit can hinder enforcement actions if it is poorly drafted or not
comprehensive.
Informal Actions
An informal action (e.g., NOV) is a warning letter notifying a facility that it has violated
one or more RCRA provisions and requiring compliance within a specified time frame. Not all
informal actions are NOVs; some states do have penalties associated with NOV (e.g., Idaho).
Generally, the state where the facility is located issues the NOV, even when EPA discovers
the violation. The state provides copies of the NOV to EPA. EPA will issue an NOV if the state
requests or if the state is not authorized to take the desired enforcement action (e.g., violation is
for SWMU corrective action and state is not authorized for this HSWA provision).
EPA tracks compliance with the NOV, regardless of the issuing agency. EPA may work
with the state to ensure that compliance is "timely and appropriate."
Formal Administrative Actions
If a facility does not comply with an EPA-issued NOV within the specified time frame,
EPA will initiate a formal enforcement action, such as an administrative order or filing an
administrative complaint. If EPA is not satisfied with the state's action or the facility's response,
EPA may take additional action to enforce the order.
EPA is authorized to issue four types of administrative orders under RCRA. EPA considers
the nature of the compliance problem, remedy sought, and type of facility when choosing the
type of order to issue:
• 3008(a) Compliance Orders: Issued when the facility subject to RCRA has violated one
or more statutory or regulatory provisions. The primary purpose of this type of order
is to bring the violator into compliance with RCRA. The order may require immediate
compliance or may include a compliance schedule.
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• 3013 Monitoring, Analysis, Testing, and Reporting Orders: Issued to obtain information
from a site owner or operator regarding a known or suspected release of hazardous
waste. Before issuing the order, EPA must have reason to believe that 1) hazardous
waste has been or may have been released at the site and 2) hazardous waste present at
the site does or may present a substantial hazard to human health or the environment.
Section 3013 orders impose specific testing, monitoring, analytical, and reporting
requirements for the purpose of characterizing the alleged release. This type of order,
however, cannot require the owner/operator to undertake corrective action.
• 7003 Imminent and Substantial Endangerment Orders: Requires a responsible party to
abate an imminent and substantial endangerment to human health or the environment.
EPA must have reason to believe that the respondent's handling, storage, treatment,
transportation, or disposal of solid or hazardous waste may present an imminent and
substantial endangerment. This is a complex determination and the standard is generally
higher than for any other administrative order.
• 3008(h) Corrective Action Orders: Issued when EPA has reason to believe that there is
or has been a release of hazardous waste from an interim status facility. The purpose
of the order is to require the responsible party to take corrective action to clean up or
abate the release. Note that EPA may also require corrective action in a permit, and any
violation of such requirements is subject to administrative or judicial enforcement.
An administrative order is a legally binding order. The procedures for issue an
administrative order vary by the type of order. Some orders are issued unilaterally; others
provide the respondent with an opportunity to request a hearing before the order is effective.
Administrative orders also may be issued as consent orders. Although administrative orders are
legally binding, a recalcitrant violator may be taken to court to obtain a judicial order requiring
compliance.
Civil Judicial Actions
In addition to formal and informal administrative enforcement actions, EPA can initiate civil
judicial proceedings under RCRA. RCRA civil actions involve a trial in Federal District Court.
Attorneys from the Department of Justice (DOJ) handle RCRA civil cases for EPA; therefore,
these cases frequently are called civil referrals. The DOJ also defends appeals from EPA
enforcement actions filed in Federal District Court.
In general, EPA initiates civil actions for two reasons:
• To obtain a judicial order (i.e., injunction) requiring one or more of the following:
1) compliance with any RCRA requirement, 2) abatement or cleanup of a release of
hazardous waste presenting an imminent and substantial endangerment, or 3) compliance
with an outstanding administrative order
• To obtain a judicial order imposing monetary penalties for 1) violating RCRA or 2)
violating an outstanding administrative order.
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Criminal Judicial Actions
EPA also has the authority to seek criminal penalties, including fines and prison terms, for certain
serious, intentional violations of RCRA. Procedures for criminal actions under RCRA are similar
to criminal prosecutions under other federal laws. The types of activities defined as criminal
under RCRA are given in Section 3008(d). The Office of Criminal Investigations within the
National Enforcement Investigations Center is responsible for investigating allegations of criminal
misconduct. The U.S. Attorney's Office is primarily responsible for prosecuting the case, with
the assistance of a DOJ attorney.
Selecting the appropriate enforcement tool to address a RCRA compliance problem is
essentially a judgment call, although a number of factors should be considered in making this
decision, including:
• Consistency with EPA policies and guidelines
• Threshold requirements for each enforcement tool
• Case history of compliance/noncompliance, desired remedy, procedural complexity of
available enforcement tools, threat of human or environmental exposure, willfulness of
the violation, need to compel long-term conduct, etc.
• Special procedures for parallel proceedings (i.e., simultaneous administrative/civil and
criminal enforcement actions) on separate tracks to prohibit information exchange, which
are time consuming and resource intensive.
In addition to formal enforcement actions, EPA has the ability to terminate a permit for
noncompliance by the permittee.
7.4 COORDINATION BETWEEN PERMIT WRITER AND ENFORCEMENT STAFF
Ideally, the compliance/enforcement staff and permit writer work together to monitor
compliance at facilities that have applied for or received a permit. If the facility's permit
application is being reviewed, the permit writer and the application will usually be valuable
sources of information on the facility, and the permit writer may have information needs that the
inspector can fulfill during an inspection (e.g., verifying completion of modifications to the
facility which the permit applicant has stated have been made in amendments to the permit
application). If a facility has received a permit, the permit writer and permit are valuable
information sources, and the permit imposes site-specific requirements subject to enforcement and
should be evaluated during the inspection. In either case, the permit writer may be able to
identify suspected problem areas at a facility.
Enforcement staff also may assist the permit writer by initiating an administrative order to
address a problem if the permit is delayed or to pursue corrective action more rapidly than is
possible through the permitting process.
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On occasion, development of successful enforcement actions and permits depends on the
cooperation from numerous individuals to review reports and interpret data in disciplines with
which the permit writer and enforcement personnel may not be experienced. For example, permit
development often requires a review of a hydrogeologic study. Additionally, the person
preparing a § 7003 order may need assistance in developing an Endangerment Assessment report
that describes environmental fate and transport of contaminants, identifies lexicological properties
and hazards, and evaluates risk. When faced with unfamiliar issues, the permit writer and
enforcement officer should obtain technical support from individuals experienced in the
applicable area.
7.5 ROLES FOR PERMIT OVERSIGHT AND ENFORCEMENT
Because of the state authorization process, the state in which the facility is located generally
is responsible for compliance monitoring, including permitted facilities. EPA may take the lead
in conducting inspections when such is requested by the state or at facilities that are:
• Owned or operated by federal, state, or local governments
• Operated under non-authorized state programs
• Selected facilities for an oversight inspection
• Operating under EPA-issued permit conditions, such as those for which the state is not
authorized (e.g., corrective action).
EPA must notify an authorized state of an upcoming inspection, and the state can decide
whether or not to have a state inspector accompany the EPA inspector.
7.6 CORRECTIVE ACTION CASES
EPA frequently can pursue corrective action through the requirements of the permit when
it is issued. In some cases, it is preferable to pursue corrective action through an enforcement
action, for example, when:
• A facility is exempt from a RCRA permit (e.g., delisted waste).
• A permit cannot be issued in a timely manner to address corrective action needs.
• A permit application is late or deficient.
As discussed earlier, Section 3008(h) of RCRA establishes the authority and the guidelines
to pursue corrective action when a release has occurred at an interim status facility.
The agency (authorized state or EPA) issuing the corrective action permit conditions should-
be responsible for monitoring compliance. Because EPA does not delegate authority for Section
3008(h), EPA is responsible for oversight of corrective action orders.
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8. ENVIRONMENTAL JUSTICE
&EPA
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Module 8 Objectives
• Discuss the history of environmental justice
and national efforts to address related
concerns
• Become familiar with efforts at the state level
to address environmental justice
• Define and describe environmental justice
concerns and enforcement issues
• Review EPA headquarters workplans that
focus on environmental justice activities
• Identify and discuss regional environmental
justice activities
Notes:
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Environmental Justice
"Fair treatment of people of all races, income,
and culture with respect to the development,
implementation, and enforcement of
environmental laws, regulations, and
policies."
Notes:
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"Fair Treatment"
Notes:
"No person or group of people should
shoulder a disproportionate share of the
negative environmental impacts resulting
from the execution of this country's domestic
and foreign policy programs."
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Early History of Environmental Justice
Movement
1982: Warren County, 1987: Toxic Wastes and
NC demonstration Race in the United States
against PCB landfill issued by UCC
1983: GAO report states that 3
out of 4 RCRA facilities in
Region IV are in minority
communities
Notes:
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History (Continued)
1992: National Law
Journal report alleges
EPA discrimination in
RCRA enforcement
1995: Environmental
Justice Strategies due
to the President
1994: President Clinton issues
Executive Order 12898 holding
11 agencies accountable for
environmental justice
Notes:
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1982: Warren County, NC
• PCB landfill to be sited in Warren County:
— Scientifically questionable location
— Water table 5-10 feet below surface
— Community 84% African-American
— 63.7% of Warren County's population
— 24.2% of North Carolina's population
Notes:
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1983: GAO Report
• Inspired by Warren County controversy
• Found that 3 out of 4 hazardous waste
facilities in Region IV were located within
predominately African-American
communities
V
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1987 & 1994: United Church of Christ
• Communities with hazardous waste Iandfills=
2Xs the minority population
• 3 of 5 largest landfills are in African-
American and Hispanic^American
communities
• Conclusion: Race most significant factor in
hazardous waste landfill sitings
Notes:
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1992: The National Law Journal Report
• Penalties allegedly 506% higher at RCRA
sites with greatest white population than at
sites with greatest minority population
(average fines of $335,566 versus $55,318)
Notes:
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EXECUTIVE ORDER 12898
• Directed federal agencies to develop an
Environmental Justice Strategy that
identifies and addresses disproportionate
negative impacts of programs and policies on
minority and low-income populations by
March 24, 1995
Notes:
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Enforcement, Compliance Assurance, and
• Identification of environmental justice
communities
- GIS data
- Census data
- Health statistics
• Development of innovative settlements
- Supplemental environmental projects
• Education of communities on regulations
Regulatory Reviews
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Exposure Concerns:
Lead, Air, & Water
Lead poisoning continues to be great concern
for low-income, minority children
Higher percentages of minorities live within
nonattainment areas under the CAA
Native American, African-American, and
Asian/Samoan populations consume greater
quantities of fish potentially contaminated
with PCBs, dioxins, furans, and lead
Notes:
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RCRA-Specific Concerns
• Environmental justice concerns with RCRA
primarily involve:
- Siting
- Permitting issues
- Corrective action
- Enforcement issues
• EPA proposed rule on public participation in
RCRA permitting recently published
• Incorporation of environmental justice
concerns into RCRA corrective action
priority setting methods
Notes:
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Environmental Justice Enforcement Targeting
• Oversiting in disadvantaged communities
• Disproportionate exposure
• Non-participation in decision making
Notes:
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EJ Enforcement Targeting (Continued)
• Target enforcement initiatives on:
- High-risk areas (e.g., highly populated
industrialized areas)
- Specialized industries where
environmental justice is a concern
Notes:
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Targeting Tools
• Environmental justice evaluations/analyses:
- Checklists
- Risk equations
- Computer programs
Notes:
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Evaluation Parameters
• GIS data
• Census data
• Health statistics
• Multimedia release data
• Minority composition
• Economic status
• Potential risk
Notes:
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Community Involvement/Outreach
• Barriers to participation
- Lack of awareness
- Rights under RCRA and other regulations
- Permitting/monitoring/enforcement
processes
- Lack of communication
- Language barriers
- Limited information dissemination
- No community organization
Notes:
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Environmental Justice in OECA
• Established Environmental Justice
Coordinating Council (EJCC)
- Represents major offices in OECA
- Assists in developing agency-wide strategic plan
- Promotes EJ through enforcement activities at all
levels
* Named full-time Environmental Justice
Coordinatar
Notes:
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EJCC Activities
• EJCC-produced documents
- OECA draft strategy outline
- Potential project lists
- Draft OECA workplans
Notes:
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Notes:
QCEA. Workplan Highlights
• EJ targeting exercises with other agencies
• EJ criteria in SEP cost determination
• EJ goal implementation within litigation
• EJ community outreach and mediation
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Regional Workplan Highlights
• Region I: EJ-related SEPs in settlements
• Region II: Translation of public notices into
foreign languages for EJ communities
• Region V: Interagency partnerships to
address EJ concerns
• Region VI: Development of computer EJ
analysis methodology
• Region IX: Identification and prioritization
of affected EJ communities
Notes:
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Wilson Jones. Quick Reference Index System
© 1991 Wilson Jones Company
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8. ENVIRONMENTAL JUSTICE
Background Materials
SEPA
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8. ENVIRONMENTAL JUSTICE
8.1 INTRODUCTION
Many minority, low-income communities have raised concerns about the disproportionate
burden of health consequences they suffer from the siting of industrial plants and waste dumps,
as well as from exposure to pesticides or other toxic chemicals at home and on the job. Their
primary concerns are that environmental programs do not adequately address these
disproportionate exposures.
In accordance with President Clinton's Executive Order 12898 (discussed in the next
section), the U.S. Environmental Protection Agency (EPA) is addressing these concerns by
assuming a leadership role in environmental justice initiatives and developing an environmental
justice strategy to enhance environmental quality for all U.S. residents. The Agency looks to
assure, through its policies, programs, and activities, that no segment of the population, regardless
of race, color, national origin, or income, bears disproportionately high and adverse human health
and environmental effects.
Environmental justice concerns first gained public attention in 1982, when a small, low-
income, and predominantly African-American community in Warren County .North Carolina, was
selected as a polychlorinated biphenyl (PCB) landfill disposal site. (The community was 84
percent African-American and comprised nearly two-thirds of the total African-American
population in the state.) Despite a National Association for the Advancement of Colored People's
(NAACP) request for an injunction on the basis of racial discrimination and numerous protests,
the landfill opened as planned.
As a direct result of this event, Walter Pacntroy requested that the General Accounting
Office (GAO) examined hazardous landfill sitings in eigtit southern states to determine the extent
to which minority communities were disproportionately exposed to environmental contamination.
GAO published its findings in a 1983 report that concluded that three out of every four landfills
in the eight states studied were located in predominately African-American neighborhoods.
The link between race and hazardous landfill sitings was further confirmed by a 1987 study
conducted by the United Church of Christ's (UCC) Commission on Racial Justice. According
to the UCC report, three out of every five African-Americans and Hispanic Americans lived in
communities with uncontrolled toxic waste sites. The study concluded that race is the strongest
determining factor in the siting of hazardous waste facilities.
A 1992 issue of National Law Journal, dedicated solely to environmental justice concerns,
reported on variations in Resource Conservation and Recovery Act (RCRA) penalties between
white and minority communities. The journal reported that RCRA sites in areas with whites
comprising the largest portion of the population were required to pay penalties 506 percent higher
than sites in areas with largest minority populations. The average penalty was $335,566 in the
white areas and only $55,318 in the minority areas.
Because the concept of environmental justice is still somewhat new to the Agency, the
majority of its efforts to date have been in outreach and education for both Agency employees
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and the public. The Agency is also developing strategies and analyzing data to determine how
this concept fits into future compliance assurance, compliance monitoring, and enforcement
activities.
8.1.1 Definition of Environmental Justice
Environmental justice has been a growing concern for more than 10 years, yet no one
definition has been universally adopted. Nevertheless, EPA's Office of Environmental Justice has
developed a definition that is generally accepted across the Agency, as well as by many other
groups. This definition defined environmental justice as:
The fair treatment of people of all races, income, and cultures with respect to the
development, implementation, and enforcement of environmental laws, regulations,
and policies. Fair treatment implies that no person or group of people should shoulder
a disproportionate share of the negative environmental impacts resulting from the
execution of this country's domestic and foreign policy programs.
8.1.2 Executive Order 12898
In response to the nationwide allegations of environmental injustice, President Clinton
issued Executive Order 12898 on February 11, 1994. This Executive Order, entitled Federal
Actions to Address Environmental Justice in Minority Populations and Low-Income Populations,
required all federal agencies to develop an environmental justice strategy by March 24, 1995.
The strategy must identify and address "disproportionately high and adverse human health or
environmental effects of (an agency's) programs, policies, and activities on minority populations
and low-income populations."
EPA's environmental justice strategy is based on two goals:
• No segment of the population, regardless of race, color, national origin, or income, as
a result of EPA's policies, programs, and activities, suffers disproportionately from
adverse human health or environmental effects, and all people live in clean, healthy, and
sustainable communities.
• Those who live with environmental decisions—community residents, state, tribal, and
local governments, environmental groups, businesses—must have every opportunity to
participate in decisionmaking. An informed and involved community is a necessary and
integral part of the process to protect the environment.
This strategy includes five environmental justice mission topics: 1) public participation,
accountability, partnerships, outreach, and communication with stakeholders, 2) health and
environmental research, 3) data collection, analysis, and stakeholder access to public information,
4) American Indian, Alaska Native, and indigenous environmental protection, and 5) enforcement,
compliance assurance, and regulatory reviews.
The fifth mission topic—enforcement, compliance assurance, and regulatory reviews—cites
the strategic enforcement of environmental statutes as one of four objectives. Through this
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objective,'minority and low-income communities suffering from excessive environmental hazards
will be a focus of EPA's enforcement and compliance assurance activities. Enforcement efforts
will include the identification of communities bearing incommensurate negative impacts through
the use of current demographic information, media program data, and health statistics.
Enforcement and compliance assurance programs, along with innovative enforcement action
settlements (e.g., supplemental environmental projects) that will decrease future exposures, will
be designed to meet the needs of affected communities.
To achieve the objectives of its environmental justice strategy, EPA is:
• Ensuring that environmental justice is part of all Agency programs, policies, and
activities
• Identifying methodologies, research, and data needed to identify and evaluate populations
at disproportionately high environmental or human health risks, as well as ensuring that
these needs are considered in developing the overall federal research program
• Ensuring that compliance monitoring inspections and enforcement actions have a
multimedia focus to address exposures by minority and low-income populations
• Promoting outreach, communication, and partnerships with stakeholders to ensure
sufficient stakeholder access to training, information, and education.
8.2 STATE ENVIRONMENTAL JUSTICE LEGISLATION
In addition to federal efforts to address environmental justice concerns, many state
legislatures are actively attempting to reduce or eliminate this problem. As of September 1994,
for example, 12 states had introduced either legislation or resolutions addressing environmental
justice issues. Three of these laws were enacted and three resolutions passed (see Exhibit 8-1).
Both the laws and resolutions enacted and those considered but not adopted reflect the broad
interest of the states in environmental justice. These initiatives suggest that states will consider
and, perhaps, adopt additional environmental justice legislation over the next several years.
8.3 ENVIRONMENTAL JUSTICE CONCERNS
8.3.1 Lead
Lead poisoning continues to be a large concern for low-income, minority groups despite
government bans on various lead-based products. Three million tons of old lead remain in homes
and buildings around the country in the form of paipt and pipes and have the largest impact on
minority children. Lead exposure can and does occur through multiple pathways (e.g.,- air, water)
and has known physiological and neurobehavioral effects. While data indicate that all
socioeconomic and ethnic groups have children with high blood lead, a higher percentage of
African-American children have unacceptable levels compared to white children. For both
African-American and whites, as income levels rise, blood lead lowers. Exhibit 8-2 provides
additional data on the blood lead levels of African-American and white children by income level.
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Exhibit 8-1. Overview of State Environmental Justice Legislation/Resolutions
State Legislation/
Resolution (date)
Summary of Provisions
Arkansas Act 1263
(4/93)
Establishes a rebuttable presumption that prohibits the construction or
operation of any high-impact, solid waste management facility (e.g.,
solid waste landfill; solid or commercial hazardous waste incinerator;
commercial hazardous waste treatment, storage, or disposal facility)
within 12 miles of an existing facility. Presumption may be overcome
where no other site is available because of geological conditions or the
facility provides incentives to the host community (e.g., employment,
contributions to infrastructure, compensation to adjacent landowners,
subsidization of community services).
Florida House Bill
1369 (5/94)
Creates Environmental Equity and Justice Commission (EEJC) to assess
the magnitude of disproportionate environmental impacts imposed upon
minorities and low income communities. The EEJC must submit a
preliminary report addressing specified environmental justice concerns
to the state legislature by December 31, 1995, subsequently hold three
public hearings, and incorporate all findings into a final report. The
EEJC may prepare model legislation if necessary.
Louisiana Act 767
(6/93)
Provides for fairness in the decisionmaking process of the Department
of Environmental Quality (DEQ). Requires the DEQ to hold three
public hearings to gather public comments regarding environmental
justice.
Michigan House
Resolution No. 662
(9/94)
Acknowledges the right of all Americans to live in a pollution-free
environment and expresses support for the passage of Senate Bill S.
1841 in the U.S. Congress. Senate Bill S. 1841 would prohibit
discrimination on the basis of race, color, or national origin in programs
and activities related to occupational and other exposure to hazardous
waste substances.
Tennessee House
Joint Resolution No.
146 (5/93)
Outlines a hypothetical Environmental Justice Act of 1993 and calls
upon the Departments of Health and Human Services, Agriculture, and
Environment and Conservation to analyze the proposed act and report
findings to the legislature.
Virginia House
Joint Resolution No.
529 (2/93)
Documents the state's desire to ensure that discrimination and the
disproportionate exposure of minorities to the emissions of solid waste
facilities does not occur in Virginia. Requests that a joint legislative
audit and review commission study the siting, monitoring, and cleanup
of solid and hazardous waste facilities, emphasizing ways in which they
have affected minority, communities. This report will be submitted to
the Department of Waste Management, the Governor, and 1995
legislative session of the General Assembly.
Source: Hacker, Barton. 1994 (September) Environmental Justice: Legislation in the States.
Center for Policy Alternatives.
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Exhibit 8-2. Percentage of Children with Unacceptably High Blood Lead Levels
Race
Income Level
< $6,000
$6,000 - $15,000
> $15,000
African-American
68%
54%
38%
White
36%
23%
12%
To address the concerns associated with lead exposure, EPA is developing a risk
communication campaign aimed directly at lead. For example, the Office of Water has published
several pamphlets addressing lead contamination and measures to take that may reduce exposures.
These pamphlets are targeted not only at homeowners but also at residents of large housing
projects or other buildings in which low-income populations may be housed. One pamphlet
discusses ways residents can reduce lead exposure by flushing household taps prior to drinking
the water. The pamphlet explains that flushing will only increase monthly water bills by 25 cents
per month. It also suggests that the flushed water can be used for other purposes, such as
watering plants or washing floors or other items.
EPA is also gathering and analyzing available data on sources emitting or discharging lead
through multiple pathways. While not specifically an environmental justice-oriented activity, it
does incorporate demographic data, such as income level and population by age group, and could
be used to identify areas of environmental justice concern.
8.3.2 Air Pollution
Air pollution is obviously an urban problem and, because a large proportion of the U.S.
minority populations resides in urban environments, it is only logical that they receive more
exposure to air pollutants. A study conducted by Argonne National Laboratory on the
demographics of areas designated by EPA as non-attainment areas under the Clean Air Act
determined that higher percentages of African-Americans and Hispanic-Americans compared to
whites live in non-attainment areas for particulate matter, carbon monoxide, ozone, sulfur dioxide,
and lead (see Exhibit 8-3). EPA's extensive efforts to improve air quality in non-attainment areas
under the Clean Air Act Amendments should bring significant benefits to racial minority groups.
Exhibit 8-3. Percentage of Total Whites, African-Americans, and Hispanic Americans
Living in Non-Attainment Areas for Air Pollutants
Air Pollutant
Whites (%)
African-Americans (%)
Hispanic-Americans (%)
Particulate matter
14.7
16.5
34.0
Carbon monoxidie
33.6
46.0
57.1
Ozone
52.5
62.2
71.2
Sulfur dioxide
7.0
12.1
5.7
Lead
6.0
9.2
18.5
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8.3.3 Water
As mentioned earlier, a GAO report indicated that racial and ethnic minorities are more
likely to live near a commercial waste treatment facility or an uncontrolled hazardous waste site
than the general population. Such facilities and sites are likely to be sources of ground water or
surface water contamination through storm water runoff and leachate, thus exposing those
minorities to potential exposure through drinking water. In addition, consumption of fish can be
a significant route of exposure for certain pollutants, such as PCBs, dioxins, furans, and lead.
A recent survey indicated that Native Americans consumed 36 percent more fish than whites, and
African-Americans consumed 13 percent more fish than whites.
8.3.4 RCRA-Specific Environmental Justice Concerns
RCRA-specific environmental justice concerns primarily involve siting and permitting issues
and corrective action. EPA is currently taking steps to eliminate, or further control, the
environmental justice concerns associated with such matters.
On June 2, 1994, EPA published the proposed rule RCRA Expanded Public Participation
and Revisions to Combustion Permitting Procedures in the Federal Register (59 FR 28680), The
proposed rule amends the existing RCRA regulations governing the permitting of hazardous waste
management facilities by expanding the opportunities for public involvement. The proposed rule
will allow the public to participate earlier in the permitting process and at key permitting
milestones. The Agency believes the proposed rule presents significant opportunities to be
responsive to environmental justice concerns. The recommended measures in the rule help
enhance the level of public participation in the combustion permitting process by providing
minority and low income populations a greater voice in decisionmaking and an opportunity to
influence the federal and state officials who grant the permits.
When siting RCRA facilities, the Agency historically has focused solely on geological
factors and has not considered environmental justice issues. This approach has been taken
because the siting issues most relevant to environmental justice (e.g., permissable use, density)
are addressed under local zoning laws, for which EPA exercises no control. The proposed rule
will significantly change the current siting process to help ensure that environmental justice
matters are given full consideration in any siting activity. Changes in the process will include:
• Requiring the facility to conduct a meeting with the community before it submits its
permit applications
• Calling for the permitting agency to provide public notice when it receives an
application, as well as before a trial burn takes place
• Enabling the permitting agency to require a facility to maintain an information repository
(only in certain situations).
The Agency hopes to publish the final rule in fall 1995.
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As for corrective action. EPA is currently examining whether priority setting meltods
adequately consider en vironmental justice concerns. For ssample, environmental justice concerns
are being incorporated into the Agency's new Hazardous Waste Identification Rule-Contaminated
Media rulemaking. The rule would allow regulators to require collection of demographic data
for areas surrounding sites. In addition, EPA is evaluating whether the Xalional Correction
Action Prioritization System, which is used to rank RCRA corrective action sites, adequately
considers environmental justice concerns. The system currently enables site rankings to include
environmental justice considerations.
8.4 ENVIRONMENTAL JUSTICE AND ENFORCEMENT ISSUES
8.4.1 Targeting of Concerns
The following elements contribute to situations of environmental discrimination: oversiting
of facilities in disadvantaged communities, disproportionate exposure of sensitive populations,
and lack of public participation in decisionmaking processes. These elements serve to identify
situations with possible environmental justice concerns. To address the issue of environmental
justice, inspections should target high-risk jireas, such as densely populated industrialized
communities. Enforcement initiatives should focus on high-risk areas as well or in specialized
industries where environmental justice is a potential issue.
Environmental justice evaluations serve as useful tools in enforcement targeting. These
evaluations can take the form of checklists, computerized methodologies and risk equations
(which often involve mapping programs), census data, and release information. Industrial
facilities are ranked according to potential health and environmental impacts and often researched
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tx¦ jiancfv c-rxrrIii ^rizrilj- ErrocoenjEtr eej^jeJsl Euticg? itiy be ~ i.-1; h 5. nrperjdtna tci
:ri :or^ ni inert**! rev, r>i ea ije Its basu fir J-jerrrtr.r^; sievie; a jJe pi-iitns
a p-- jxr_uJ eT-i:orntr*ai el-I ice -e-rc=rr. Tz< tr cxpapclazed anea bzistzi. p--.di.ci
evaluation could receive a zero (0 = no environmental justice concern) from an environmental
justice index, although a neighboring minority community could be affected directly.
8.4.2 Community Involvement/Outreach
The lack of puVuc participation in decisionmaking :s a primary concern in environment
justice cases. If this problem can be rectified, many environmental justice concerns can be
prevented. Cammiirjly involvement and outreach efforts empower populations who lack
sufficient resources to understand their rights under environmental regulations, mobilize efforts,
and take appro prate actions Barriers thai prevent low-income, minority oommunilies from
taking an active role in environmental and human health protection usually seem from lack of
education, awareness, and organization. For a community to be effeclive, citizens must know
the facts and when to use them, as well as clearly communicate information to others.
Facilities are often blamed for negative environmental impacts based on perception talks*
than fact. People are usually aware of polluting industries in their neighborhoods, but they may
not realize that these facilities are permitted to discharge within permit limits. Most communities
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RCRA Practitioners Enforcement Workshop
Environmental Justice
do not have, or know how to obtain, information regarding a facility's permits and compliance
records. More important, they are not familiar with, nor do they understand, the legislation that
regulates these facilities. Knowledgeable enforcement staff can assist communities in accessing/
interpreting technical information, such as Toxics Release Inventory (TRI) data, and explain
citizens' rights under RCRA (e.g., public participation during permitting processes).
Effective communication poses another barrier to the involvement of minority groups in
decisionmaking. Public notices, facility records, and training materials in English are of little
value to minorities who do not speak or understand English. Language, however, is not the only
barrier to information dissemination—media such as newspapers and television may be luxuries
that low-income, minorities cannot afford. Other forms of media (e.g., free church bulletins,
community bulletin boards, flyers) may reach targeted audiences more effectively.
8.5 EPA HEADQUARTERS WORKPLANS
The Office of Enforcement and Compliance Assistance (OECA) created an Environmental
Justice Coordinating Council (EJCC) run by a full-time Environmental Justice Coordinator.
Major offices within OECA provide representatives to the EJCC charged with the development
of the agency-wide strategic plan. As of the FY 1994 Enforcement Accomplishments Report, the
EJCC produced the following documents for use within EPA: 1) OECA draft strategy outline,
2) potential project lists describing the office's goals and objectives, and 3) draft OECA
workplans, which provide detailed project descriptions, relationships to goals set forth, and key
efforts. Representatives to the EJCC also provide input for the development of OECA's portion
of the EPA-wide strategic plan.
8.5.1 Purpose of Environmental Justice Workplans
Under the direction of Executive Order 12898, OECA has developed environmental justice
project workplans. The purpose of these workplans is twofold: 1) to ensure and promote
environmental justice in OECA compliance programs, policies, and activities and 2) to ensure
and promote environmental justice in OECA enforcement programs, policies, and activities.
According to the workplans, the broad goal of the projects is to "achieve environmental
protection for all so that no segment of the population, regardless of race, national origin, or
income bears disproportionately high and adverse effects of environmental pollution."
8.5.2 Examples of Environmental Justice Projects
The OECA environmental justice project workplans include policy reviews, special
initiatives to decrease the impact of hazardous waste exports, coordination'of agency efforts, and
outreach services. One project undertaken that affects the RCRA Enforcement Division and other
OECA divisions is the review of supplemental environmental project (SEP) policies to ensure the
integration of environmental justice considerations. Key efforts include evaluation of cases to
determine the presence of environmental justice concerns, implementation of environmental
justice concerns when considering penalty reductions using the revised SEP policy, and inclusion
of environmental justice as a factor to calculate the percentage of the SEP cost applied to
mitigate the penalty as calculated by the penalty policy.
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RCRA Practitioners Enforcement Workshop
Environmental Justice
Another all-division OECA environmental justice project seeks to.guarantee equal protection
in environmental law. This project links efforts with the Department of Justice to recognize
current cases in which environmental justice goals can be implemented. To successfully achieve
this project goal, a workgroup consisting of the Department of Justice, the Office of Civil Rights,
and other environmental justice representatives must be established.
More specific to the RCRA Enforcement Division is a joint effort among headquarters, the
regions, and states in targeting candidates for enforcement actions. The project is aimed at
reducing the effects of exported hazardous waste from U.S. companies to countries lacking
effective environmental protection programs. Implementation activities for this project include
stringent enforcement of hazardous waste export laws, data base development, and joint
participation in targeting exercises with the Department of Transportation and Customs.
The Office of Regulatory Enforcement, in addition to the projects highlighted previously,
has developed enforcement guidance documents focused on the identification of environmental
justice cases and the need for integration of environmental justice issues in litigation packages
and consent decrees. These documents are currently in draft form.
The Enforcement Capacity and Outreach Office of OECA has established a pilot program
to address community involvement and outreach efforts. The program will address various
environmental justice topics, such as citizens rights and regulatory processes, community
involvement in permitting decisions, and training in data interpretation and enforcement/
compliance monitoring activities.
8.6 EXAMPLES OF REGIONAL ENVIRONMENTAL JUSTICE ACTIVITIES
The regions have taken an active role in integrating environmental justice concerns into
their policies and practices, including RCRA inspection and enforcement activities. Most projects
are components of the regions' environmental justice action strategies required under Executive
Order 12898, with attention to the special needs and situations of minority communities within
their jurisdiction.
8.6.1 Region I
Recognition of environmental justice issues in daily practices has been deemed a necessity
by Region I, illustrated through its 1993 environmental justice policy statement and
implementation framework. To address environmental justice concerns, program staff must have
adequate information to target and prioritize their activities. Region I created a data base that
provides program staff with data to target communities for environmental justice consideration.
Tools for targeting communities are essential for effectively addressing environmental justice
concerns.
Several action items from Region I's Office of Solid Waste and Emergency Response's
Environmental Justice Implementation Plan Progress Report focus on RCRA inspections and
enforcement actions. Environmental justice has been mecicpotated into the region's inspection
targeting matrix. Region I has conducted 18 RCRA program inspections in environmental justice
areas from May 1, 1994, through December 31, 1994. Enforcement actions have been prioritized
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RCRA Practitioners Enforcement Workshop
Environmental Justice
and targeted based on environmental justice impact analysis data, and settlements have included
SEPs. For example, an administrative complaint was issued against three Massachusetts Highway
Department (MHD) facilities, one located in an environmental justice community, for RCRA
violations. Settlement included a $100,000 penalty, $5 million SEPs, and $20 million on audits
and remediation activities in all MHD facilities.
8.6.2 Region II
Recognizing the importance of community participation in RCRA permitting and corrective
actions, Region II established a program for the translation of public notices into the native
language of local residents. In addition to traditional media, the region is placing notices in
foreign newspapers. Ten RCRA sites located within Region II are undergoing environmental
justice evaluations for prioritization of permit and corrective action activities in the following
geographic areas: Buffalo and the Bronx, New York; Ponce, Puerto Rico; and Newark, New
Jersey.
8.6.3 Region III
Region Hi's RCRA program is participating in the region's multimedia enforcement initiative
to use demographic analysis as one of the criteria in the multimedia screening and site selection
process for targeting enforcement actions. The region has also drafted a RCRA facility
evaluation form to incorporate environmental justice into its priority setting for RCRA corrective
action. Specific environmental justice areas of concern in the region include Chester,
Pennsylvania; Baltimore, Maryland; and the Anacostia River Watershed in Washington, DC.
8.6.4 Region IV
Region IV's environmental justice activities have focused on combustion facilities and
implementation of guidance on environmental justice in siting, permitting, public involvement,
and corrective action. As part of this activity, the region has been selecting key facilities with
upcoming major decision points that may include environmental justice. The region is also
developing a place-based environmental justice initiative in Alabama. The initiative includes
regional participation in determining compliance of stationary sources and compliance inspections
of significant air emitters located in environmental justice areas.
In addition, the region is providing financial and technical assistance to Native American
Tribes for the RCRA Subtitle D program. The region is funding several tribes that have ongoing
projects. Tribes in the program include:
• The Eastern Band of Cherokee, which received money to fund a full-time solid waste
coordinator to continue a recycling and public outreach program
• The Seminole Tribe, which received funding to hire a solid waste manager to implement
recommendations from the tribe's solid waste management plan
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RCRA Practitioners Enforcement Workshop
Environ mental Justice
* The Miccosute.es Tribe, which received funding to develop and operate a recycling
program
* The Choctaw Tribe, which received funding to prepare a solid waste management plan.
$.63 Region V
Southeast Chicago and its multiple pollution problems are the focus of Region V's Southeast
Chicago Environmental Initiative Action Plan. The initiative includes a framework to address
the high concentration of disposal sites and industrial facilities located within low-income,
minority communities, A. partnership becu-een EPA, Chicago's Department of Environment and
die Liicois EPA was formed tn addie&s rougher enforcement of environmental regulations,
8.6.6 Region VI
Tha Office of Planning and Analysis in Region VI published a computer-assisted
environmental justice index methodology, which provides an overview of the Environmental
Justice Analysis System. The analysis system serves as a too] for enforcement target in» and
facility permitting concerned with CJivironmefllai justice.
Using the &^;roi\meTrtal Justice Index, calculated frotn five variables, the analysis system
rank? sites that m&y be of environmental justice concern. The following three parameters are
considered the essential variables in the equation, population, percent minority, and percent of
ecoftpmicaJly stressed households in the study area. Sites are ranked on a scale from 0 to 100;
the higher the rank, the greater the potential concern. Region V] uses, this computer methodology
in CGfljtiactios with a noncompliance search in ail media programs, which is conducted with a
computerized risk screening methodology using census mftrrnation andTRl datarorankfacsJiiies
under evaluation. Sites that receive high scores in the various criteria are targeted for
enforcement activities.
8.6.7 Region VIl
Region VU is upgrading its geographic information systems (G1S> with socioeconomic data,
such as background, family size, and proximity to Superfurkd and RCRA facilities, to target
RCRA compliance inspections in areas that the region has deemed to be potential environmental
justice problem areas; This program is based cr. geographic piloii, including the current rilot
:n St. Locis/East St. Louis area- The region is also using socioeconomic data lo identify
environmental justice areas to help prioritize corrective actions. A RCRA corrective action
facility located in such an area will be considered as a higher priority facility in the corrective
action prioritization and planning process.
8-6.8 Region VIET
Region VHI is making environmental justice a primary issue in its multimedia workgroup.
The workgroup is identifying high-minority and/or low income communities in the region and
then jdentifyi/ig major emitters in those areis. The data gathere d by the workgroup will be used
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RCRA Practitioners Enforcement Workshop
Environmental Justice
to target specific industrial sectors for inspection and better target enforcement and compliance
assistance activities.
8.6.9 Region IX
Region IX has initiated a multimedia environmental justice assessment project to identify
low-income, minority communities through GIS and 1990 census data and overlay the
information with emission and release sources. Data will allow the region to prioritize its efforts
among affected communities. An important component of this project is outreach within the
region to collect and analyze information, as well as consider future recommendations.
8.6.10 Region X
Region X designated an Indian Coordinator to increase technical assistance to Native
American tribes in the northwest. To date, the coordinator has conducted workshops and
organized tribal conferences to discuss environmental justice issues. The region is also using
contractors (referred to as circuit riders) to conduct outreach and technical assistance to tribes and
Native Alaskan villages. These circuit riders visit tribes to learn about their current needs and
issues and to deliver information on sound solid waste management.
8-12
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n
§* 58
ir<">
§ 50
s'D
o" <
-J —
£ 2
3i a
9-
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
9. RCRA CIVIL AND CRIMINAL ENFORCEMENT:
"TOOLS OF THE TRADE"
SEPA
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RCRA Practitioners Enforcement Workshop RCRA Enforcement: Tools of the Trade.
Module 9 Objectives
• Become familiar with basic RCRA tools:
-= Inspections and information gathering authorities
- Administrative orders
- Civil actions
- Criminal proceedings
- Suspension or revocation of permits
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
Inspections and Information Gathering
• § 3007 allows EPA to inspect and gather
information for developing regulations or
enforcing RCRA provisions:
- Any person who handles, or handled, hazardous
waste
- Relating to management of hazardous waste
- May inspect and obtain samples
- Enforceable with penalties up to $25,000 per day
of noncompliance.
Notes:
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RCRA Practitioners Enforcement Workshop RCRA Enforcement: Tools of the Trade
Administrative Enforcement
• EPA is authorized to issue administrative
orders under RCRA.
• A Final administrative order is legally
binding.
• Procedures for issuance vary by the type of
order:
- Unilateral
- Consent.
• Violator may be taken to federal court to
enforce order.
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
Administrative Enforcement Flow Chart:
| Violation Discovered!
Case Screening
Nationally
Significant Issues
Administrative
Action
Recommended
Draft Order/Penalty
Calculation
ORC Review/Final
Order/ORC
Concurrence
Informal
Settlement
Conference .
Requested?
4
^YES
Conference
Consent
Filed
Order '
ALJ
Decision
1
V
^Appeal?
-YES
Environmental
Appeals Board
Review
Order Issued
l^-YES NO
Notes:
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RCRA Practitioners Enforcement Workshop RCRA Enforcement: Tools of the Trade
Civil Enforcement
• EPA initiates civil actions to obtain:
- Injunctions requiring:
• Compliance with RCRA requirements
• Remediation of a release of hazardous waste
• Compliance with administrative orders
- Monetary penalties for:
• Violating RCRA
• Violating administrative orders.
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
Civil Enforcement
• General Procedures
— Executive Order 12778, "Civil Justice Reform,"
57 FR 3640 (January 20, 1992) procedures must
be followed.
— Federal Rules of Civil Procedures and Evidence
apply.
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
Notes:
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September 1995
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jtCRA. Practitioners Enforcement Worksh&p RCRA Enforcement: Tools of the Trade
Enforcement Strategy
• Selecting the appropriate enforcement tool
- Ca.se screeining procedures
- EPA policies and guidelines
- Threshold requirements for enforcement tool
- Other factors (e.g., case history, desired remedy)
- Special procedures for parallel proceedings
Notes:
8
September 1995
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RCBA Practitioners Enforcement Workshop
RCRA Enforcement; Tools of the Trade
Comparison of Administrative and Civil
Enforcement
Notes:
administrative
Handled wichln EPA
No ramnl litigation report
required
Stmpitr quicker process
Rurcr to settle
Executive Qnfer UTT8 don not
¦pply
Enforced In federal tourt, more
steps needed to obtain csnlempt
wdm
f>oi rpcamtnena'ta for renicltrint
rioliwrs
CIVIL
OQJ represents EPA In cht
UUgsUon
Forn>») wigMteo rtport «qeir«f
Often u\ot9 longer to conclude
Crater publicity; regulattti
caiWMtaity m*y ULe more
jitrwusty
Must comply wHh Ewctitiv*
Order nT7B
Can b« wnforewl through the
court's contempt tulhorttv
More effective i^almt
recilclttuu
9
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
Overview of RCRA Compliance Monitoring and
Enforcement Authorities
Information
Gathering
Compliance
with Statute,
Regs, or
Orders
Civil
Penalties
Remediation
Criminal
Penalties
Authority
§3007
$3013
59005
83008(a)
$7002
§9006
53008(a)
53008(8)
53008(hX2>
$3013(e)
57003(b)
59006
53008(a)
63008(h)
§7003
53007(b)(1)
53008(d)
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
§3008(a)
"whenever. . . the Administrator determines
any person has violated or is in violation of
any requirement of this subchapter, the
Administrator may issue an order assessing a
civil penalty for any past or current violation,
. . .or the Administrator may commence a
civil action... for appropriate relief,
including a temporary or permanent
injunction."
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
\
§3008(a) (Continued)
• Administrative or judicial actions
• Violations of RCRA Subtitle C, RCRA
regulations, authorized state regulations,
permit
• Penalties of up to $2S,000 per day of
noncompliance for each violation
Based on "seriousness of violation" and "any good
faith efforts to comply"
• 1990 RCRA Civil Penalty Policy
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
§3008(h)
"Whenever... the Administrator determines
there is or has been a release of hazardous
waste into the environment from a facility
authorized... under section 6925(e)... the
Administrator may issue an order requiring
corrective action or such other response
[as]... necessary to protect human health or
the environment...'1
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
§3008(h) (Continued)
• Administrative action
- Consent order
- Unilateral order
• Judicial action
• Sanctions
- Revocation or suspension of interim status
- Penalties for violation of order
Notes:
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RCRA Practitioners Enforcement Workshop RCRA Enforcement: Tools of the Trade
§3013
"If the Administrator determines, upon
receipt of any information, that:
- The presence of any hazardous waste...or
- The release of any such waste...
may present a substantial hazard to human
health or the environment, he may issue an
order requiring the owner or operator of
such facility or site to conduct such
monitoring, testing, analysis, and reporting...
as the Administrator deems reasonable../'
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
§3013 (Continued)
• Administrative order
• May apply to previous owner
• Monitoring, testing, analytical, and reporting
proposal
• EPA can conduct monitoring
• Enforcement:
- Judicial penalties of $5,000 for each day of
violation
Notes:
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RCRA Practitioners Enforcement Workshop RCRA Enforcement: Tools of the Trade
§7003
\
"upon receipt of evidence that the past or
present handling,...of any solid waste or
hazardous waste may present an imminent
and substantial endangerment».the
Administrator may bring suit...to restrain
such person,...to order such person to take
such other action as may be necessary, or
both....The Administrator may also...take
other action including...issuing such orders as
may be necessary to protect public health and
the environment."
V
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
§7003 (Continued)
• Judicial or administrative actions
• Notice to local government agencies and
posted at site
• Public participation
• Enforcement
- Judicial action
- Penalties up to $5,000 per day
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
§3008(d)—Criminal Penalties
• § 3008(d) defines criminal acts as knowingly:
— Transporting hazardous waste to an unpermitted
¦ facility
— Violating permit requirement or interim status
standards
— Falsifying or omitting information from RCRA
documents or records
— Transporting hazardous waste without a manifest
— Exporting hazardous waste without consent of
receiving country.
Notes:
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RCRA Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
§3008—Criminal Enforcement
• § 3008(e) establishes "knowing
endangerment." Defendant must have
knowingly:
- Transported, treated, stored, disposed of, or
exported hazardous waste
- Committed one or more violations of § 3008(d)
- Placed another person in imminent danger of
death or serous bodily injury.
• Term "knowing" or "knowingly" means
intentionally or willfully.
V
Notes:
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RCRA. Practitioners Enforcement Workshop
RCRA Enforcement: Tools of the Trade
Suspension, Revocation, and Termination of
• Permits may be terminated for:
- Noncompliance with any condition of the permit;
- Failure to disclose or misrepresenting relevant
facts in permit application; or
- A determination that the permitted activity
endangers human health or the environment.
Permits
V
Notes:
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RCRA Practitioners Enforcement Workshop RCRA Enforcement: Tools of the Trade
Enforcement Strategy
New Enforcement Response Policy
- Classifies RCRA violations and violators
- Defines "timely and appropriate" response
- Establishes enforcement response goals
Notes:
22
September 1995
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Wilson Jones.- Quick Reference Index System
© 1991 Wilson Jones Company
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
9. RCRA CIVIL AND CRIMINAL ENFORCEMENT:
"TOOLS OF THE TRADE"
Background Materials
svEPA
Zk1
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INSTRUCTOR NOTES
RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
9. RCRA CIVIL AND CRIMINAL ENFORCEMENT:
"TOOLS OF THE TRADE"
Time: 1.5 to 2 hours
Objectives:
¦ Review basic applications and requirements of administrative and judicial enforcement
tools.
¦ Discuss advantages and disadvantages of different enforcement approaches.
¦ Examine inspection and information gathering authorities.
Emphases:
¦ Civil and administrative enforcement and relief under § 3008(a) and (g)
¦ Criminal enforcement under § 3008(d)
¦ Corrective action under § 3008 (h)
¦ Monitoring, testing and analysis under § 3013
¦ Imminent and substantial endangerment actions under § 3007
¦ Inspection and information gathering under § 3007(a)
Bibliography:
U.S. Environmental Protection Agency. 1993 (March). RCRA Practitioners Enforcement
Workshop: Course Materials.
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RCRA Civil and Criminal Enforcement:
"Tools of the Trade"
9. RCRA CIVIL AND CRIMINAL ENFORCEMENT:
"TOOLS OF THE TRADE'1
9.1 RCRA § 3008(a) CIVIL ENFORCEMENT
9.1.1 RCRA § 3008(a)
Resource Conservation and Recovery Act (RCRA) § 3008(a), 42 U.S.C. § 6928(a), provides
in pertinent part that:
(1) Except as provided in paragraph,(2), whenever on the basis of any information the.
Administrator determines that any person has violated or is in violation of any
requirement of this subchapter, the Administrator may issue an order assessing a civil
penalty for any past or current violation, requiring compliance immediately or within
a specified time period, or both, or the Administrator may commence a civil action
in the United States district court in the district in which the violation occurred for
appropriate relief, including a temporary or permanent injunction.
9.1.2 What Can Be Enforced Under RCRA § 3008(a)
Under RCRA § 3008(a), the U.S. Environmental Protection Agency (EPA) can take
enforcement action to address violations of:
• RCRA Subtitle C (RCRA §§ 3001-3039b, 42 U.S.C. §§ 6901-6939b)
• EPA's regulations implementing RCRA Subtitle C (40 CFR Parts 260-271)
• Hazardous waste regulations of a state which has been authorized by EPA to
administer such regulations in lieu of the EPA regulations (see RCRA § 3006, 42 U.S.C.
§ 6926)
• Terms of a RCRA permit issued by EPA and/or an authorized state under RCRA §
3005(a), 42 U.S.C. § 6925(a), and 40 CFR Part 270 (or analogous state authorities).
Actions to enforce RCRA Subtitle C under RCRA 3008(a) may be brought administratively
or judicially.
9.1.3 Judicial Enforcement
Procedures
Judicial cases must be referred to the Department of. Justice (DOJ). Before cases can be
referred, a litigation Report must be prepared by the Office of Regional Counsel (ORC),
including input from the regional program office and other relevant technical support. If DOJ
1. This module was originally written by Mary Coe, Associate Regional Counsel, U.S. EPA Region HI.
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RCRA Civil and Criminal Enforcement:
"Tools of the Trade"
accepts the referral, DOJ will coordinate with ORC to prepare a complaint. The procedures
implementing Executive Order 12778, Civil Justice Reform, (57 FR 3640; January 20, 1992)
must be followed.
The complaint will be filed by DOJ, through the appropriate U.S. Attorney's Office (i.e.,
in the district in which the violation occurred). Relief sought may include penalties and/or
injunctive relief. In filing and pursuing such an action, the Federal Rules of Civil Procedure and
Evidence apply. Any appeals are to the appropriate U.S. Court of Appeals.
Advantages of Judicial Enforcement
The advantages of bringing a judicial enforcement action include the following:
• The ability to immediately seek a contempt order from the District Court, if the Consent
Decree is violated
• A federal court may be inclined to award larger penalties
• Greater publicity; often, the regulated community takes judicial actions more seriously
because of the Justice Department's involvement
• DOJ'.s attorneys are skilled litigators
• More effective against recalcitrants and likely noncompliers than administrative
enforcement.
Disadvantages of Judicial Enforcement
However, judicial enforcement also poses some disadvantages. These include:
• The need to prepare a litigation report
• The need to coordinate the litigation with DOJ
• Often takes longer to obtain results-
• Need to comply with Executive Order 12778.
9.1.4 Administrative Enforcement
Typical Process for Preparing and Issuing RCRA Administrative Complaints
In most regions, the process of preparing and issuing a RCRA administrative complaint
includes the following:
• Facility Inspection; Inspection Report prepared
• RCRA program office develops case, drafts proposed administrative complaint, refers
draft complaint to ORC for review
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"Tools of the Trade"
• ORC reviews, comments, returns draft complaint to RCRA Program
• RCRA program revises draft complaint, submits final complaint for concurrence by
Program and ORC
• Complaint is signed by appropriate regional official (check Delegations Manual) and
issued.
Consolidated Rules of Practice Governing the Administrative Assessment of Civil
Penalties and the Revocation or Suspension of Permits (40 CFR Part 22)
Administrative enforcement under RCRA § 3008(a) is governed by the Consolidated Rules
of Practice set forth at 40 CFR Part 22. .40 CFR § 22.13 provides specifically that:
If the complainant has reason to believe that a person has violated any provision of
the Act, or regulations promulgated or a permit issued under the Act, he may institute
a proceeding for the assessment of a civil penalty by issuing a complaint under the
Act and these rules of practice. If the complainant has reason to believe that:
(a) A permittee violated any term or condition of the permit, or
(b) A permittee misrepresented or inaccurately described any material fact in the
permit application or failed to disclose all relevant facts in the permit application,
or
(c) Other good cause exits for such action, he may institute a proceeding for the
revocation or suspension of a permit by issuing a complaint under the Act and
these rules of practice. A complaint may be for the suspension or revocation of
a permit in addition to the assessment of a civil penalty.
Note: 40 CFR § 22.13 does not say anything about compliance orders.
Procedures Under 40 CFR Part 22
Exhibit 9-1 lists the procedures specified under 40 CFR Part 22 and the corresponding
regulatory citations.
Advantages of Administrative Enforcement
The advantages of administrative enforcement actions include:
• Administrative actions are handled entirely in-house (no need for DOJ concurrence or
litigation report; in most cases, no need for headquarters involvement, either)
• Usually quicker process than judicial
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RCRA Practitioners Enforcement Workshop
RCRA Civil and Criminal Enforcement:
"Tools of the Trade"
Exhibit 9-1. Procedures Under 40 CFR Part 22
Procedural Component
Requirement
The Players and their Roles
Complainant, Respondent, Regional Administrator, Regional Judicial
Officer, Presiding Officer, Administrative Law Judge, Administrator,
Environmental Appeals Board, Regional Hearing Clerk, Intervenors
(40 CFR §§ 22.03, 22.04, and 22.11).
Filing of Pleadings and documents;
service; form of pleadings and
documents
40 CFR § 22.05
Originals to Regional Hearing Clerk
. True and correct copies to Presiding Officer, Complainant, Respondent
and any other Parties (e.g., intervenors) (40 CFR 22.05).
Certificates of service
A certificate of service shall accompany each document filed or
served (40 CFR 22.05).
Service of complaint
Personal service or service by certified mail. Other service: personal
or certified or first class mail (40 CFR 22.05).
Computation and extensions of time
40 CFR § 22.07
Ex-parte contacts
40 CFR § 22.08
Complaint: issuance; amendment;
withdrawal
40 CFR §§ 22.13, 22.14
Answer to Complaint
40 CFR § 22.15
Designation of Presiding Officer
40 CFR § 22.21
Order Setting Prehearing Procedures
Preheiaring conference (40 CFR § 22.19(a))
Status Reports
Prehearing exchange (40 CFR § 22.19(b))
Discovery (40 CFR § 22.19(f))
Default Order
40 CFR § 22.17
Accelerated decision; decision to
dismiss
40 CFR § 22.20
Informal settlement; Consent
Agreement and Order
40 CFR § 22.18
Hearings
Schedule (40 CFR § 22.21)
Evidence (40 CFR § 22.22)
Objections and offers of proof (40 CFR § 22.23)
Burden of presentation and proof (40 CFR § 22.24)
Proposed Findings of Fact,
Conclusions of Law
40 CFR § 22.26
Initial Decision
40 CFR § 22.27
Motion to Reopen Hearing
40 CFR § 22.28
Appeal of Initial Decision
40 CFR § 22.30. Appeals are heard by the newly-created
Environmental Appeals Board, effective March 1, 1992. See 57 FR
5320 (February 13, 1992).
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Exhibit 9-1. Procedures Under 40 CFR Part 22 (continued)
Procedural Component
Requirement
Final Order
40 CFR § 22.31
Motion to Reconsider Final Order
40 CFR § 22.32
Supplemental Rules for RCRA
40 CFR § 22.37
• Often easier to settle
• Executive Order 12778 does not apply.
Disadvantages of Administrative Enforcement
Disadvantages associated with administrative actions include:
• ALJs historically have awarded lower penalties than federal court judges
• Less deterrent effect than judicial enforcement
• Must go to federal court to enforce against violations of the settlement agreement; more
steps to obtain contempt order
• Less effective against recalcitrants and likely noncompliers than judicial enforcement.
9.1.5 Civil Sanctions Under RCRA § 3008(a)
Penalties
Statutory and Regulatory Limitations on Penalties
Section 3008(a)(3) of RCRA provides, in pertinent part, that:
Any penalty assessed in the [compliance] order shall not exceed $25,000 per
day of noncompliance for each violation of a requirement of [RCRA Subtitle C].
In assessing such a penalty, the Administrator, shall taken into account the
seriousness of the violation and any good faith efforts to comply with applicable
requirements.
Section 3008(c) of RCRA provides that:
If a violator' fails to take corrective action within the time specified in a
compliance order, the Administrator may assess a civil penalty of not more than
$25,000 for each day of continued noncompliance with the order.
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Section 3008(g) of RCRA provides, in part, that:
Any person who violates any requirement of [RCRA Subtitle C] shall be liable
to the United States for a civil penalty in an amount not to exceed $25,000 for
each such violation. Each day of such violation shall, for purposes of this
subsection, constitute a separate violation.
40 CFR § 22.14(c) provides that:
The dollar amount of the proposed civil penalty shall be determined in
accordance with any criteria set forth in the Act relating to the proper amount
of a civil penalty and with any civil penalty guidelines issued under the Act.
Thus, the following points are noteworthy:
• The statutory maximum civil penalty for violations of RCRA is $25,000 per violation,
per day
• In assessing a civil penalty in a RCRA judicial or administrative case, EPA must
consider the seriousness of the violation and any other good faith efforts to comply
• When assessing penalties in RCRA administrative cases, EPA must comply with any
"civil penalty guidelines" issued under RCRA
• In judicial cases, the amount of the penalty to be imposed is committed to the informed
discretion of the court.
1990 RCRA Civil Penalty Policy
EPA issued a revised RCRA Civil Penalty Policy in October 1990. (See separate module
on RCRA Civil Penalty Policy.)
Compliance Orders and Injunctive Relief
As noted earlier, RCRA § 3008(a) provides, in part, that whenever EPA determines that a
person has violated or is in violation of any requirement of RCRA Subtitle C, EPA may issue
an administrative order requiring compliance immediately or within a specified time (in addition
to imposing penalties)* or EPA may commence a civil action seeking appropriate relief, including
a temporary or permanent injunction.
If a person violates an administrative compliance order issued under RCRA § 3008(a), EPA
may assess a civil penalty of not more than $25,000 for each day of continued noncompliance
with the order, and may suspend or revoke any permit issued to the violator. See RCRA §
3008(c), 42 U.S.C. § 6928(c).
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Termination of Permit (42 U.S.C. § 3008(a)(3) and (c); 40 CFR § 270.43;
40 CFR Part 124)
EPA may institute an administrative proceeding for the termination of a permit by issuing
a notice of intent to terminate under 40 CFR § 124.5(d) and otherwise following the procedures
described in 40 CFR Part 124, Subpart A. The permittee or any other interested person may
request an evidentiary hearing for reconsideration of, or to contest, such permit termination using
the procedures set forth in 40 CFR Part 124, Subpart E.
40 CFR § 270.43 sets forth the following causes for terminating a permit during its term
(as well as for denying an application for permit renewal):
• Noncompliance with any condition of the permit
• Failure in the application or during the permit issuance process to disclose fully all
relevant facts, or misrepresentation of any relevant facts at any time; and
• A determination that the permitted activity endangers human health or the environment
and can only be regulated to acceptable levels by permit modification or termination.
Revocation or Suspension of Interim Status (42 U.S.C. § 3008(a)(3), (c) and (h); 40 CFR
Part 22)
EPA may institute an administrative proceeding to revoke or suspend interim status by filing
a complaint and otherwise following the procedures set forth in 40 CFR Part 22. The grounds
for revocation or suspension of interim status are set forth in 40 CFR § 22.13, as follows:
• Violation of any term or condition of "the permit" (i.e., of interim status standards set
forth in 40 CFR Part 265 or analogous authorized state regulations)
• Misrepresentation of, inaccurate description of, or failure to disclose any material fact
in the permit application; and
• Other good cause.
9.1.6 EPA's Revised Enforcement Response Policy
The principal agency guidance on enforcement of RCRA Subtitle C is the 1995 Revised
Enforcement Response Policy (ERP) (Revised ERP), which iis to be released in summer 1995,
and replaces the version dated December 21, 1987. The ERP sets forth a scheme for classifying
facilities that violate RCRA, provides guidance on timely and appropriate enforcement responses
and describes conditions for EPA enforcement action in authorized states.
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As stated in the 1987 Revised ERP,
,..[t]he goal of the RCRA compliance monitoring and enforcement program is the
attainment and maintenance of a high rate of compliance within the regulated
community by establishing a comprehensive inspection program and by taking timely,
visible and effective enforcement actions against serious violators.
The 1987 Revised ERP provides enforcement response guidance on civil actions—both
judicial and administrative—pursuant to RCRA § 3008(a) (and authorized state program
analogues). While not initially applicable to actions under RCRA §§ 3008(h), 3013 or 7003, the
1987 Revised ERP does apply when orders, decrees or other judgments issued under such
authorities are violated.
9.1.7 EPA Enforcement of RCRA Subtitle C in Authorized States
Section 3008(a)(2) of RCRA, 42 U.S.C. § 6928(a)(2), provides that:
In the case of a violation of any requirement of [RCRA Subtitle C] where such
violation occurs in a state which is authorized to carry out a hazardous waste program
under Section 3006, the Administrator shall give notice to the state in which such
violation has occurred prior to issuing ah order or commencing a civil action under
this section.
EPA has interpreted this to mean that it has authority to take independent action to enforce
provisions of a state's authorized program as well as to enforce provisions of the base program
or the Hazardous and Solid Waste Amendments (HSWA) for which a state has not yet received
authorization. The courts have agreed. See T&S Brass and Bronze Works, Inc., 681 F. Supp.
314 (D.S.C 1988), aff'd 865 F.2d 1261 (4th Cir. 1988); Wyckoff Company v. EPA, 796 F.2d
1197 (9th Cir. 1986); United States v. Environmental Waste Control Inc., 710 F. Supp. 1172
(N.D. Ind. \9%9)\ aff'd Nos 89-1865 and 89-2197 (7th Cir., October 31, 1990); United States,v.
Environmental Waste Control, Inc., 698 F. Supp. 1422 (N.D. Ind. 1988); (United States v.
Conservation Chemical Co. of Illinois, 660 F. Supp. 1236 (N.D.'Ind., April 23, 1987); United
States v. Rogers, 685 F. Supp. 201 (D. Minn. 1987); In re Municipal and Industrial Disposal
Company, RCRA Appeal No. 87-4 (CJO, November 1, 1988); In re CID-Chemical Waste
Management of Illinois, Inc., RCRA Appeal No. 87-11 (CJO, August 18, 1988)).
The 1987 Revised Enforcement Response Policy provides that states authorized to
administer their own hazardous wiaste programs under RCRA § 3006 have, the primarily
responsibility for ensuring compliance with RCRA. However, it is EPA's policy to take
enforcement action in an authorized state when:
• The state asks EPA to do so and provide justification based on unique case-specific
circumstances
• The state fails to take "timely and appropriate" enforcement action (see In re Cyclops,
Docket No. RCRA V-W-85-R-002 (September 24, 1985))
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• The state is not authorized to take the action; or
• A case could establish a legal precedent.
EPA may also consider overfilling an enforcement action if it believes a state's enforcement
response was inadequate (e.g., where noncompliance continues)..
9.2 RCRA § 3008 CRIMINAL ENFORCEMENT
9.2.1 Background: The "Knowledge" Element
i
There are two criminal enforcement provisions in RCRA Subtitle C: Section 3008(d),
42 U.S.C. § 6928(d) ("knowing violations" of RCRA); and Section 3008(e), 42 U.S.C. § 6928(e)
("knowing endangerment"). In addition, Section 3008(f), 42 U.S.C. § 6928(f) defines some of
the terms used in Section 3008(e).
Both of the criminal enforcement provisions require knowledge as an element. How is
knowledge defined?
The government has argued, quite successfully, that the majority of RCRA criminal offenses
are "general intent" crimes, that is, the government need show only that the violative acts were
intentional. Under this standard, the government is-not required to show that the defendant knew
that his or her act was unlawful, or had knowledge of specific laws or regulations. The
government must prove that the defendant knew of the factual conduct, that constituted that
violation.
To date, there have been only a handful of reported decisions involving the criminal
enforcement provisions of RCRA. Generally, the cases have held, consistent with general intent
statutes, that knowledge of specific laws and regulations may be inferred and need not be proved.
However, there has been some disagreement regarding whether knowledge of the existence or
absence of a permit is required in cases involving transport to a facility without a permit (RCRA
§ 3008(d)(1)) or disposal without a permit (RCRA § 3008(d)(2)(A)). See United States v.
Speach, 968 F.2d 795 (9th Cir. 1992) and United States v. Hayes International Corp., 786 F.2d
1499 (11th Cir. 1986) (knowledge of absence of a permit is an element of RCRA § 3008(d)(1));
United States v. Johnson & Towers, Inc741 F. 2d 662 (3d Cir. 1984), cert, denied sub. nom.
Angel v. United States, 469 U.S. 1208 (1985) (knowledge of absence of permit is an element of
RCRA § 3008(d)(2)(A)); United States v. Hoflin, 880 F.2d 1033 (9th Cir. 1989) and United
States v. Laughlin, 768 F. Supp. 957 (N.D.N.Y. 1991) (knowledge of absence of a permit not an
element of RCRA § 3008(d)(2)(A).
A few cases hold that a defendant must have knowledge that the substances involved in the
alleged violations of RCRA are harmful or hazardous, but not that they are listed or characteristic
RCRA hazardous wastes. See United States v. Hoflin, 880 F.2d 1033 (9th Cir. 1989), cert,
denied, 110 S. Ct. 1143 (1990); United States v. Dee, 912 F.2d 741 (4th Cir. 1990); United States
v. Baytank (Houston) Inc., 934 F.2d 599 (5th Cir. 1991); United States v. Sellers, 926 F.2d (5th
Cir. 1991) (dicta).
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9.2.2 RCRA § 3008(d) "Knowing Violations"
RCRA § 3008(d), 42 U.S.C. § 6928, provides that:
Any person who:
(1) knowingly transports or cause to be transported any hazardous waste identified
or listed under this subtitle to a. facility which does not have a permit under this
subtitle, or pursuant to title I of the Marine Protection, Research, and Sanctuaries
Act (86 Stat. 1052),
(2) knowingly treats, stores, or disposes of any hazardous waste identified or listed
under this subchapter
(A) without a permit under this subchapter or pursuant to title I of the Marine
Protection, Research, and sanctuaries Act (86 Stat. 1052); or
(B) in knowing violation of any material condition or requirements of such
permit; or
(C) in knowing violation of any material condition or requirements of any
applicable interim status regulations or standards;
(3) knowingly omits material information or makes any false material statement or
representation in any application, label, manifest, record, report, permit", or other
document filed, maintained, or used for purposes of compliance with regulations
promulgated by the Administrator (or by a state in the case of an authorized state
program) under this subchapter;
(4) knowingly generates, stores, treats, transports, disposes of, exports, or
otherwise handles any hazardous waste or any used oil not identified or listed as
a hazardous waste under this subchapter (whether such activity place before or
takes place after the date of the enactment of this paragraph) and who knowingly
destroys, alters, conceals, or fails to file any record, application, manifest, report,
or other document required to be maintained or filed for purposes of compliance
with regulations promulgated by the Administrator (or by a state in the case of an
authorized state program) under this chapter;.
(5) knowingly transports without a manifest, or causes to be transported without a
manifest, any hazardous waste or any used oil not identified or listed as a
hazardous waste under this subchapter required by regulations promulgated under
this subchapter (or by a state in the case of a state program authorized under this
subchapter) to be accompanied by a manifest; or
(6) knowingly exports a hazardous waste identified or listed under this subchapter
(A) without the consent of the receiving country or, (B) where there exists an
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international agreement between the United States and the international agreement
between the United States and the government of the receiving country establishing
notice, export, and enforcement procedures for the transportation, treatment,
storage, and disposal of hazardous wastes, in a manner which is not in
conformance with such agreement; or
(7) knowingly stores, treats, transports, or causes to be transported, disposes of, or
otherwise handles any used oil not identified or listed as a hazardous waste under
this subchapter—
(A) in knowing violation of any material condition or requirement of a permit
under this subchapter; or
(B) in knowing violation of any material condition or requirement of any
applicable regulations or standards under this chapter;
shall, upon conviction, be subject to a fine of not more than $50,000for each day
of violation, or imprisonment not to exceed two years (five years in the case of a
violation of paragraph (1) and (2)), or both. If the "conviction is for a violation
committed after a first conviction of such person under this paragraph, the
maximum punishment under the respective paragraph shall be doubled with respect
to both fine and imprisonment.
9.2.3 RCRA § 3008(e) "Knowing Endangerment" and RCRA § 3008(f) "Special
Rules"
RCRA § 3008(e), 42 U.S.C. § 6928(e), provides that:
Any person who knowingly transports, treats, stores, disposes of, or exports any
hazardous waste identified or listed under this chapter in violation of paragraph (1),
(2), (3), (4), (5), (6) or (7) of subsection (d) of this section who knows at the time
that he thereby places another person in imminent danger of death or serious bodily
injury, shall, upon conviction, be subject to a fine of riot more than $250,000 or
imprisonment for not more than fifteen years, or both. A defendant that is an
organization shall, upon conviction of violating this subsection, be subject to a fine
of not more than $1,000,000.
RCRA § 3008(f), 42 U.S.C. § 6918(f), provides that, for the purposes of subsection (e) of
this section:
(1) A person's state of mind is knowing with respect to-
(A) his conduct, if he is aware of the nature of his conduct;
(B) an existing circumstance, if he is aware of believes that the circumstance
exists; or
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(2) In determining whether a defendant who is a natural person knew that his
conduct placed another person in imminent danger of death or serious bodily
injury—
(A) the person is responsible only for actual awareness or actual belief that he
possessed; and
(B) knowledge possessed by a person other than the defendant but not by the
defendant himself may not be attributed to the defendant;
Provided, that in proving the defendant's possession of actual knowledge,
circumstantial evidence may be used, including evidence that the defendant took
affirmative steps to shield himself from relevant information.
(3) It is an affirmative defense to a prosecution that the conduct charged was
consented to by the person endangered and that the danger and conduct charged
were reasonably foreseeable hazards of-
(A) an occupation, a business, or a profession; or
(B) medical treatment or medical or scientific experimentation conducted by
professionally approved methods and such other person had been made aware of
the risks involved prior to giving consent.
The defendant may establish an affirmative defense under this subsection by a
preponderance of the evidence.
(4) All general defenses, affirmative defenses, and bars to prosecution that may
apply with respect to other federal criminal offenses may apply under subsection
(e) of this section and shall be determined by the courts of the United States
according to the principles of common law as they may be interpreted in the light
of reason and experience. Concepts of justification and excuse'applicable under
this section may be developed in the light of reason and experience.
(5) The term "organization'1 means a legal entity, other than a government,
established or organized for any purpose, and such term includes a corporation,
company, association, firm, partnership, joint stock company, foundation,
institution, trust, society, union, or any other association persons.
(6) The term "serious bodily injury" means-
(A) bodily injury which involves a substantial risk of death;
(B) unconsciousness;
(G) extreme physical pain;
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(D) protracted loss or impairment of the function of a bodily member, organ,
or mental faculty.
9.2.4 Policies and Procedures
Candidates for Criminal Enforcement
Prosecutors look for cases that demonstrate knowledge/intent and harm even though "harm"
is not technically an element of Section 3008(d) violations.
Classic cases involve: Midnight dumping, falsification of records, reports, manifests or land
disposal restriction (LDR) .notices/certifications.
Other classic elements: Defendant's prior involvement with regulatory agencies; specialized
knowledge.
EPA's criminal program seeks to prosecute individuals (rather than just corporations) where
possible. Individuals can be given prison sentences—a greater deterrent than monetary fines.
See, for example, United States v. Dee, 912 F.2d 741 (4th Cir. 1990) (upheld conviction of three
individual civilian employees of U.S. Army for violations of RCRA § 3008(d)(2)(A)).
Parallel Proceedings
Occasionally, in the course of a RCRA civil investigation or proceeding, one discovers
possible criminal conduct by the subject of the investigation or proceeding. Conversely, in the
course of a RCRA criminal investigation or proceeding, one may discover conditions or activities
that call for a civil investigation or proceeding.
A classic example is where an on-going criminal violation of RCRA is causing harm to
public health or the environment and should be addressed quickly by injunctive relief.
When circumstances involving both civil and criminal conduct arise, it can raise difficult
procedural, policy and due process issues. For instance:
• Where both civil and criminal enforcement attorneys are developing cases, to what
degree may the two attorneys share information?
• Where the civil and criminal enforcement attorneys both seek to interview or obtain
testimony from the same witness, might the testimony, in the civil deposition "preview"
the governments case to the defense, or create two sets of contradictory testimony?
• Must a civil investigator give Miranda warnings to a witness being interviewed if it is
possible or likely that the information could later be shared with a criminal investigator?
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To address these and other issues, EPA and DOJ have developed guidance on when to
proceed with civil enforcement, when to select criminal enforcement and when it is permissible
to enter into so-called "parallel proceedings." These guidances are:
• "Guidelines on Investigative Procedures for Parallel Proceedings" (June 1989)
• "Procedures for Requesting and Obtaining Approval of Parallel Proceedings" (June 15,
1989)
• "Supplement to Parallel Proceedings Guidance and Procedure for Requesting and
Obtaining Approval of Parallel Proceedings" (July 18, 1990)
• "Land and Natural Resources Division Dir. No. 5-87, Guidelines for Civil and Criminal
Parallel Proceedings" (October 13, 1987)
Copies of these guidance documents may be obtained from EPA's Office of Criminal
Enforcement or the Environmental Crimes Section at DOJ.
According to the above-referenced DOJ guidance:
• As a general rule, when both civil and criminal action are possible for a single statute,
a criminal proceeding should generally be brought and resolved before a civil action.
The rationale for this includes:
- Speedy trial act considerations
- More substantial deterrent and punitive effects of criminal sanctions
- Courts may reduce criminal sentences if civil penalties have already been imposed
- Conviction in a criminal case can be used as collateral estoppel in a subsequent civil
case on the same issue.
• Exceptions to the general rule:
- Where ongoing civil violations present such a threat to public health or the
environment that immediate injunctive relief is necessary.
- Where defendant's assets are in danger of dissipation
- Where there is only a marginal relationship between the civil and criminal violations
- Cases where the statute of limitation period for civil enforcement is about to expire
• Information developed by or obtained by criminal investigators should be shared with
civil enforcement attorneys only in accordance with F.R. Crim. Pro. 6(e).
Rule 6(e) bars federal prosecutors from disclosing matters occurring before the grand
jury to anyone except under narrowly defined circumstances. In United States v. Sells
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Engineering Inc., 463 U.S. 418, the Supreme Court held that rule 6(e) bars federal
prosecutors from disclosing grand jury material to DOJ civil attorneys when the civil
attorneys are using the information for purposes other than assisting the criminal case.
Therefore:
- To the extent possible, evidence should be obtained by criminal investigators by
methods other than grand jury subpoena, such as searches and interviews
- Prior to presentation to the grand jury, investigators should summarize or segregate
evidence obtained up to that time; track all evidence obtained independently of the
grand jury
- If information is not subject to Rule 6(e), criminal enforcement team may share such
information with civil team
- When Rule 6(e) does apply, only federal prosecutors and supervisory attorneys may
share grand jury information. Can only share with other DOJ civil attorneys or EPA
civil attorneys and investigators provided that such sharing is necessary to assist the
prosecutor in enforcing criminal law and meets certain notification requirements of
Rule 6(e)(3)(B). With court permission, information on violations of state criminal
laws may be disclosed to state criminal enforcement personnel
- Any other disclosure of grand jury information may be only on a showing of
"particularized need" any per court order under Rule 6(e)(3)(C)(i)
- What constitutes "matters occurring before the grand jury" is complex, unsettled
• Evidence obtained through civil or administrative discovery or inspections may be shared
with federal and state criminal prosecutors. The flow of information from civil to
criminal is not covered by Rule 6(e). However, the following rule applies:
- There must have been a good faith civil or administrative basis for the discovery
- Administrative inspection must have been "objectively reasonable" (i.e., supported by
administrative probable cause; limited to normal administrative scope; authorized by
voluntary consent, administrative search warrant or "scheme of pervasive regulation")
- Advise DOJ section chief, before sharing, how above two elements are satisfied
- Evidence obtained through civil or administrative inquiries other than formal
discovery or compulsive means may be shared regardless of good faith, so long as
these has been no deception
• Miranda warnings are unnecessary during civil discovery
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- Miranda warnings only required for "custodial interrogation." Civil investigation is
not custodial
- If a deponent asks about the possibility of criminal liability, civil attorney should
respond: "The United States is free to choose civil, criminal or administrative
enforcement and any decision to take one type of action does not preclude another
types of action"
- If a witness asks other questions about self-incrimination, right to counsel, etc. tell the
witness, he/she is free to consult his/her own attorney.
Double Jeopardy: United States v. Halper
Another matter to consider when a violation could be addressed by either civil or criminal
enforcement is the risk of "double jeopardy."
In U.S. v. Halper, 109 S. Ct. 1892 (1989), the Supreme Court held that under the double
jeopardy clause, a defendant who already has been punished in a criminal prosecution may not
be subjected to an additional civil sanction to he extent that such second sanction may not fairly
be characterized as remedial, but only deterrent or retribution. Id. at 1902. Thus, Halper bars
the United States from seeking punitive damages (or civil penalties that are punitive) from, a
defendant in a civil action if that defendant has already been convicted for the same conduct in
a previous criminal prosecution.
Although Halper directly applies to a civil proceeding which follows a criminal prosecution
its principles also apply when the civil action precedes the prosecution. See U.S. v. Mayers, 827
F.2d 1126 (11th Cir. 1990), cert, denied, 111 S. Ct. 178 (1990); U.S. v. Adolfo Ayala Sanchez,
No. M-90-020 (S.D. Tex. 1990).
Note the following points regarding double jeopardy:
• No double jeopardy if state action follows a federal action (or vice versa); "dual
sovereign"
• If state enforcement is "tool of federal enforcement," "dual sovereign" concept may not
work. Problem for authorized states (e.g., state civil action followed by EPA criminal
action). (In such case, argue penalties go to state; state law enforces state standards; try
to separate the two.)
• Try to tie the civil penalty to compensation
• Argue that the harm caused by the defendant is impossible to quantify; penalty equals
liquidated damages. Some courts have bought this. Halper seems to accept this
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• Permit revocation may be considered remedial, not punitive
• A defendant who previously agreed to pay civil penalties under a settlement with EPA
can't raise a Halper double jeopardy claim if the defendant knew a criminal investigation
was pending. U.S. v. Marcus Schloss & Co., Inc., 724 F. Supp. 1123 (S.D. N.Y. 1989)
• Play up the factors in our RCRA Civil Penalty Policy ("potential for harm" >and
"economic benefit").
9.3 RCRA § 3008(h) CORRECTIVE ACTION AT INTERIM STATUS FACILITIES
9.3.1 RCRA § 3008(h)
RCRA Section 3008(h) provides, in part, that:
(1) Whenever on the basis of any information the Administrator determines that
there is or has been a release of hazardous waste into the environment from a
facility authorized to operate under section 3005(e) of this title, the Administrator
may issue an order requiring corrective action or such other response measure as
he deems necessary to protect human health or the environment or the
Administrator may commence a civil action in the United States district court in
the district in which the facility is located for appropriate relief, including a
temporary or permanent injunction.
(2) Any order issued under this subsection may include a suspension or revocation
of authorization to operate under section 3005(e) of this title, shall state with
reasonable specificity the nature of the required corrective action or other response
measure, and shall specify a time for compliance. If any person named in an order
fails to comply with the order, the Administrator may assess, and such person shall
be liable to the United States for, a civil penalty in an amount not to exceed
$25,000 for each day of noncompliance with the order.
9.3.2 Elements of RCRA § 3008(h)
The discussion below addresses the key elements of § 3008(h):
• "Whenever on the basis of any information the Administrator determines..."
- Administrator's authority has been delegated to Regional Administrators and Assistant
Administrator for Solid Waste and Emergency Response. (See Delegation No. 8-31
March 6, 1986.) Check Regional Delegations Manual for sub-delegations.)
- Information can be obtained from various sources, e.g., sample data, inspection
reports, phdtographs, facility records, permit applications state records, corroborated
informant's tips or citizen complaints. Consider utilizing RCRA § 3007 information
requests
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- Civil referrals under RCRA § 3008(h) should include a separate written
"Determination of Release."
• "...that there is or has been a release...into the environment..."
- Term "release" not defined in the statute; use th&CERCLA definition: "any spilling,
leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping or disposing into the environment." 42 U.S.C. § 9601(22). The
exemptions in the CERCLA definition do not apply
- Term "environment" not defined. Legislative history makes it clear that Section
3008(h) is not limited to any particular medium. H. Rep. No. 1133, 98th Cong., 2nd
Sess. 111-112 (1984)
- Not necessary to have actual sampling data to show a release. May rely on other
information (e.g., cracked dike of surface impoundment)
- No minimum amount of hazardous waste of constituents required for a release.
• "...of a hazardous waste..."
- Term "hazardous waste" is not limited to regulatory definition, i.e., wastes listed or
identified in 40 CFR Part 261. Definition includes hazardous waste as more broadly
defined in the statute (RCRA § 1004(5)). The definition also, includes "hazardous
constituents." See H. Rep. No. 1133, 98th Cong. 2d Sess. 111-112 (1984); U.S. v.
Environmental Waste Control, Inc., 710 F. Supp. 1172 (N.D. Ind. 1989), aff'd, 917
F.2d 327 (7th Cir. 1990), cert denied, 111 S. Ct. 1621 (1991); U.S. v. Clow Water
Systems, 701 F. Supp. 1345 (S.D. Ohio, 1988)
- "Hazardous constituents" are substances listed in 40 CFR Part 261, App. VIE
• "...from a facility..."
- For the purpose of RCRA § 3008(h), EPA uses the definition of "facility" applied in
the context of corrective action at permitted facilities). There, the term is defined as
"all contiguous property under the control of the owner or operator seeking a permit
under RCRA Subtitle C of RCRA." This definition is taken from the proposed
corrective; action regulations ("proposed Subpart S Rule"), 55 FR 30798, 30874.' This
definition was upheld in the context of RCRA § 3004(u) in United Technologies
Corp. v. EPA, 821 F.2d 714 (D.C. Cir. 1987)
- Unlike Section 3004(u), Section 3008(h) broadly authorizes corrective action for any
release from a "facility." It does not require (as Section 3004(u) does) a finding that
the release came from a "solid waste management unit" (SWMU).
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- Once a release is determined to originate from within a facility, the scope of
remediation under Section 3008(h) is not limited by the facility boundaries. Section
3004(v) of RCRA, 42 U.S.C. § 6924(v), provides that EPA may issue orders requiring
corrective action for releases that have crossed the facility boundary if the permission
of the owner of the affected property can be obtained.
• "...authorized to operate under Section 3005(e)..."
- This requirement has been interpreted to include:
1. Facilities which, have fully qualified for interim status under RCRA § 3005(e)
and 40 CFR § 270.10 (or authorized state equivalent);
2. Facilities which have not fully qualified for interim status under RCRA §
3005(e) and 40 CFR § 270.10 (or authorized state equivalent), but which could
have (because they were "in existence" on the effective date of regulations
which made them subject to RCRA permitting requirements) and should have
(because they continued to treat, store or dispose of hazardous waste after such
date); and,
3. Facilities which had interim status, but such interim status has been terminated
under 40 CFR Part 22 (administrative termination), Section 3005(c), Section
3005(e)(2) and (3) (the "loss of interim status" [LOIS] provisions) or Section
3008(h)(2). (Note: RCRA § 3008(h) does not apply to a facility which lost
its interim status because of a final decision to grant or deny a RCRA permit
under 40 CFR Part 124.)
- Note that facilities which were issued state permits after November 1, 1984
(enactment of HSWA), but have not yet received the "federal portion" of the permit
are treated as interim status facilities for the purposes of RCRA Section 3008(h).
- Also note that a facility may be "authorized to operate under RCRA § 3005(e)" not
only while it is actively operating, but also while it is in the process of closing or
even after closure (i.e., closure itself does not terminate interim status).
• "...corrective action or such other response.:."
- Containment, stabilization, source control (Interim Measures [1M])
- Studies to characterize the nature and extent of contamination, assess exposure and
health and environmental effects (RCRA Facility Investigation [RFI])
- Identification and evaluation or remedies (Corrective Measures Study [CMS])
- Design and Construction of selected remedy; implementation (Corrective Measures
Implementation [CMI]).
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• "...as [the Administrator] deems necessary to protect human health or the environment..."
- Consider quantity and concentration of hazardous waste or constituents; extent of
contamination; properties of the hazardous wastes or constituents; transport and fate
of hazardous constituents; actual and potential exposure pathways; human and
environmental receptors; effects of exposure; other factors
- Lesser showing of threat to human health or environment needed for investigations
or studies than for actual remediation.
9.3.3 Procedures
Under Section 3008(h), EPA can issue administrative orders or commence a civil judicial
action for corrective action.
Administrative Orders
The regions most often rely on administrative action, rather than judicial action, and on
consent orders, rather then unilateral orders, to enforce RCRA § 3008(h). Administrative'orders
requiring corrective action are subject to the "Rules Governing Issuance of and Administrative
Hearings on Interim Status Corrective Action Orders," 40 C.F.R. Part 24. These rules'were
upheld in Chemical Waste Management, Inc. v. U.S. Environmental Protection Agency, 873 F.2d
1477 (D.C. Cir. 1989).
Consent Orders
The region typically notifies the facility that the region is seeking corrective action at the
facility pursuant to RCRA § 3008(h). The region encloses with the notification letter a copy of
the "Corrective Action Plan," OSWER Directive No. 9902.3-2A (May 13, 1994) and invites the
facility owner/operator to meet with the region to discuss EPA's proposal for corrective action.
Usually the region will seek to negotiate a Consent Order with the facility owner/operatpr
for performance of the "investigatory phase" of corrective action (i.e., the RFI and CMS). The
RFI/CMS is the RCRA analogue to CERCLA's Remedial Investigation and Feasibility Study
(RI/FS). The region may also seek performance of so-called EM to address releases that pose an
imminent threat to human health or the environment.
During or shortly after the first meeting, the region provides the facility owner/operator with
a draft Consent Order. The facility owner/operator is given 60 days after receipt of the draft
Consent Order to negotiate and sign a final Consent Order. This 60-day negotiation period may
be extended in certain limited circumstances pursuant to formal regional procedures.
If a final Consent Order is not signed within the 60-day negotiation period (or extended
period) the region will most likely issue a unilateral order. However, the region may also refer
the matter to the Department of Justice for judicial action or use response authorities under the
Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).
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Once the RFI/CMS stage of corrective action has been completed, the region selects, on the
basis of the RFI and CMS Reports and any other relevant information, a proposed Corrective
Measure for the facility. The selection of the proposed Corrective Measure is announced in a
"Statement of Basis" (similar to CERCLA's Proposed Plan), which is made available to the
public for comment for a 30-day period.
After review of public comments, the region makes a "Final Determination" regarding
selection of the Corrective Measure and announces such determination along with a "Response
to Comments" (similar to the issuance of a CERCLA Record of Decision). See "Guidance on
RCRA Corrective Action Decision Documents: The Statement of Basis, Final Decision and
Response to Comment," OSWER Directive No. 9902.6 (February 1991).
After the Final Determination, the region usually attempts to negotiate a second Consent
Order with the facility owner/operator requiring implementation of the Corrective Measures. If
such an agreement is not reached, the region, once again, may issue a unilateral order requiring
performance of the Corrective Measures, refer the matter to DOJ for judicial action to compel
that result, or resort to CERCLA authorities (if applicable).
Unilateral Orders
In most cases, if the region is unable to negotiate an acceptable consent order under RCRA-
§ 3008(h), it will issue a unilateral order in accordance with the procedures of 40 C.F.R. Part 24.
Rules Governing Issuance of an Administrative Hearing on Interim Status Corrective
Action Orders (40 C.F.R. Part 24)
The rules governing administrative hearings on interim status corrective action orders issued
under RCRA Section 3008(h) (40 CFR Part 24) are quite different from those governing the
administrative assessment of penalties and revocation or suspension of permits under RCRA
Section 3008(a) (40 CFR Part 22). The Part 24 rules establish a two-tiered set of procedures for
administrative hearings on unilateral RCRA § 3008(h) orders. These procedures are generally
less formal than those established by Part 22. Exhibit 9-2 provides an overview of Part 24
provisions.
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Exhibit 9-2. Overview of 40 CFR Part 24
Regulatory Provision
Overview and/or Cite
General (40 CFR Part 24, Subpart A)
Scope of rules (40 CFR §
24.01)
Apply to issuance of administrative orders under RCRA § 3008(h) and
administrative hearings on such orders, except that the procedures of 40 CFR
Part 22 apply to any order issued pursuant to RCRA § 3008(h) which:
(1) Is contained within an administrative order that includes claims under RCRA
§ 3008(a)
(2) Includes a suspension or revocation of interim status; and/or
(3) Seeks penalties under RCRA § 3008(h)(2) for non-compliance with an order
under RCRA § 3008(h).
Issuance of initial orders;
decision on final orders
and orders on consent
(40 CFR § 24.02)
A unilateral order is referred to in Part 22 as "initial administrative order";
A unilateral order which has become effective after hearing and issuance of a
final decision by the Regional Administrator, or after 30 days from issuance if no
hearing is requested, is referred to as a "final administrative order";
A Consent Order is referred to as a "final administrative order on consent";
Who may issue ah initial administrative order;
Contents of initial administrative order.
Maintenance of docket
and official record
40 CFR § 24.03
Filing and Service of
Orders, decisions and
documents
40 CFR § 24.04
Response to the initial
order; request for hearing
(40 CFR § 24.05)
Initial administrative order becomes a final administrative order 30 days after
service unless respondent files a response and requests a hearing within such
time.
Response/request for hearing may include a statement indicating whether the
procedures of 40 CFR Subpart B or Subpart C should apply.
Designation of Presiding
Officer (40 CFR § 24.06)
Informal Settlement Conference (40 CFR § 24.07)
Respondent may request; will not affect Respondent's obligation to timely
request a hearing.
Selection of appropriate
hearing procedures
40 CFR § 24.08
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Exhibit 9-2. Overview of 40 CFR Part 24 (continued)
Regulatory Provision
Overview and/or Cite
Hearing on Orders Requiring Investigations or Studies (40 CFR Part 24, Subpart B)
Where the unilateral order directs the Respondent to undertake: (1) an RFI or CMS; and/or (2) Interim
Measures which are neither costly not technically complex and are necessary to protect human health and the
environment prior to development of a permanent remedy, the hearing procedures in 40 CFR Part 24,
Subpart B (in addition to the generally applicable provisions of Subparts A and D), are employed for any
hearing requested by the Respondent.
Qualifications of
Presiding Officer; ex
parte discussion of
proceeding (40 CFR §
24.09)
Presiding Officer may be either the Regional Judicial Officer (See 40 CFR §.
24.04(b)) or attorney employed by the Agency who has no prior connection with
the case, including the performance of any investigative or prosecuting functions.
restrictions on ex parte contacts.
Scheduling the hearing;
prehearing submissions by
the Respondent (40 CFR
§ 24.10)
Date and time for hearing.
At any time up to 5 business days before the hearing the Respondent may submit
for inclusion in the administrative record information and argument supporting
Respondent's position on the facts, law and appropriate relief.
Hearing; oral
presentations and written
submissions (40 CFR §
24.11)
Presiding Officer to conduct in fair and impartial way, avoid delay and
redundancy, maintain order;
EPA must introduce administrative record and be prepared to summarize basis '
for order;
Respondent has reasonable opportunity to address relevant issues, present its
views through legal counsel or technical advisors;
Presiding Officer iriay allow technical or legal discussions and interchanges
between parties (but not direct examination or cross-examination);
Presiding Officer may address questions to Respondent's or EPA's
representatives;
Where the Respondent can demonstrate that through no fault of its own certain
documents supportive of its position could not have been submitted before the
hearing (per 40 CFR § 24.10(b)), it may submit them at hearing. Presiding
Officer may grant petitioner leave to respond to such submissions.
Presiding Officer may order either party to submit additional information either
at or after the hearing.
Summary of hearing;
Presiding Officer's
recommendation (40 CFR
§ 24.12)
A written summary of the proceedings must be prepared and signed by the
Presiding Officer as soon as practicable after the hearing;
Presiding Officer prepares and files with the Regional Administrator a
recommended decision based on the administrative record and the parties
representations at hearing;
Recommended decision must address all material issues of fact or law properly
raised by the respondent, and recommend that the order be modified, withdrawn
or issued without modification;
If any contested relief provision in the, order is not supported by a preponderance
of the evidence in the record, Presiding Officer must recommend that the order
be modified on terms supported by the record or withdrawn;
Parties may file with the Clerk comments on the recommended decision within
21 days of service of recommended decision. Comments transmitted to Regional
Administrator for consideration in reaching final decision.
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Exhibit 9-2. Overview of 40 CFR Part 24 (continued)
Regulatory Provision
Overview and/or Cite
Hearing on Orders Requiring Corrective Measures (40 CFR Part 24, Subpart C)
If the unilateral order requires the Respondent to undertake specified corrective measures (other than certain
limited interim measures), either alone or in conjunction with an RFI or CMS, the procedures in 40 CFR Part
24, Subpart C govern. Subpart C makes more formal provision than the Subpart B for submission of
evidence and argument before and at hearing and affords the respondent an opportunity (not available under
Subpart B) to pose written questions on disputed factual matters to EPA.
Qualifications of
Presiding Officer; ex
parte discussions of the
proceeding (40 CFR §
24.13)
Same as Subpart B (40 CFR § 24.09), except that ex parte discussion restriction
extends to any Agency staff member who performs a prosecutorial or
investigative function in any factually related proceeding (or any representative
of such person)
Scheduling the hearing;
prehearing submissions by
the parties (40 CFR §
24.14)
Presiding Officer establishes schedule for submission by Respondent of a
memorandum with supporting-affidavits and exhibits stating Respondent's
position, submission of a response by EPA and a public hearing;
Public hearing generally to be scheduled within 45 days of the order;
Respondent may file a request (at least 21 days before hearing) for permission to
submit written questions (no more than 25) to EPA concerning issues of material
fact in the order;
Presiding Officer "may direct EPA to respond to designated questions. Presiding
Officer may delete or revise questions for reasons including irrelevance,
redundancy, unnecessary or undue burden. Presiding Officer transmits questions
to EPA. EPA must respond within 14 days of service unless granted extension;
Presiding Officer may order either party to submit additional information before,
at or during the hearing;
Presiding Officer may issue subpoenas for the attendance and testimony of
persons, production of documents (but only as an adjunct to Presiding Officer's
authority to ask questions and clarify factual matters in dispute; not for purposes
of direct or cross-examination).
Presiding Officer may allow Respondent to submit additional information at least
5 business days before hearing.
Location of hearing.
Hearing; oral
presentations and written
submissions by the parties
(40 CFR § 24.15)
Presiding Officer to conduct in fair and impartial way, avoid delay, maintain
order;
Presiding Officer shall permit oral statements on behalf of respondent and EPA;
Presiding Officer may address questions to parties at hearing;
Apart from questions by Presiding Officer, no direct or cross-examination
allowed;
EPA shall introduce order and administrative record and summarize basis for
order. Respondent may respond; response may include new documents if
respondent can demonstrate that, through no fault of its own, such documents
could not have been submitted before hearing. Agency may rebut. Presiding.
Officer may allow respondent to respond to any such rebuttal.
Presiding Officer may grant petitioner leave to respond to submissions made by
Respondent under 40 CFR § 24.14(e).
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Exhibit 9-2. Overview of 40 CFR Part 24 (continued)
Regulatory Provision
Overview and/or Cite
Transcript or recording of
hearing (40 CFR § 24.16)
Hearing to be transcribed stenographically or tape recorded. Available for
inspection/copying;
Transcript/recording and all post-order submittals filed with clerk become part of
administrative record.
Presiding Officer's
recommendation (40 CFR
§ 24.17)
Presiding Officer files with Regional Administrator recommended decision based
on administrative record as soon as practicable after hearing.
Recommended decision must address all material issues of fact or law properly
raised by respondent and must recommend that the order be modified, withdrawn
or issued without modification;
If any contested relief provision in order is not supported by a preponderance of
the evidence in the record, Presiding Officer shall recommend that the order be
modified on terms supported by the record, or withdrawn;
Parties may file with the Clerk comments on the recommended decision within
21 days of service of recommended decision. Comments transmitted to Regional
Administrator for consideration in reaching final decision.
Post-Hearing Procedures (40 CFR Part 24, Subpart D)
Final Decision (40 CFR §
24.18)
Regional Administrator signs or modifies recommended decision, issues as final
decision. Final decision must indicate factual or legal basis for modification or
recommended decision.
Final Order (40 CFR §
24.19)
If Regional Administrator does not adopt portions of initial order or requires
modification, signatory official on unilateral order shall modify order in
accordance with final decision and file/serve.
If Regional Administrator finds unilateral order appropriate as issued, final
decision shall declare the initial unilateral order to be a final order, effective
upon service of final decision.
If Regional Administrator declares initial unilateral order must be withdrawn,
signatory official on initial unilateral order shall file and serve withdrawal of
order, with or without prejudice.
Final Agency/Action
The final decision and final administrative order are final agency actions
effective for filing and service. Not appealable to the Administrator.
Judicial Action
Under Section 3008(h), EPA may initiate a civil judicial action to compel appropriate relief,
including a temporary or permanent injunction, or to enforce a Section 3008(h) administrative
order. Generally, a civil judicial action may be preferable to issuance of an administrative order
in the following situations:
• Where a person is not likely to comply with an order or has failed to comply with a
Section 3008(h) order
• Where a person's conduct must be stopped immediately to prevent irreparable injury,
loss or damage to human health or the environment
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• Where long-term, complex and costly response measures will be required. (Because
compliance problems are more likely to arise during implementation of these actions
than while carrying out a simple, short-term action, it may be better to have the matter
already before the court for ease of enforcement.)
Other factors that could be considered include the value of a favorable decision as precedent
and the need to deter noncompliance by other potential targets for EPA enforcement action under
Section 3008(h).
A request to file a civil judicial action must be referred by the Assistant Administrator for
Enforcement and Compliance Monitoring to the Department of Justice.
9.3.4 Sanctions
Revocation or Suspension of Interim Status
RCRA Section 3008(h)(2) provides in part that "[a]ny order issued under the subsection
may include , a suspension or revocation of authorization to operate under Section 3005(e)"
(emphasis added). The procedures governing the administrative suspension of authorization to
operate under RCRA § 3005(e) (i.e., interim status) are set forth at 40 CFR Part 22.
Civil Penalties for Violation of Section 3008(h) Order
RCRA Section 3008(h)(2) provides further that:
If any person named in an order fails to comply with the order, the Administrator
may assess, and such a person shall be liable to the United States for, a civil penalty
in an amount not to exceed $25,000 for each day of noncompliance with the order.
9.3.5 Comparison of RCRA § 3008(h) to RCRA § 3004(u)
Section 3008(h) is not the only "corrective action" provision in RCRA Subtitle C. RCRA
Section 3004(u), 42 U.S.C. § 6924(u), provides that:
[A] permit issued after November 8, 1984 ... shall require, corrective action for
all releases of hazardous waste or constituents from any solid waste management
unit at a treatment, storage, or disposal facility seeking a permit under this
subchapter, regardless of the time at which waste was placed in such unit.
Both RCRA § 3008(h) and RCRA § 3004(u) authorize EPA to require corrective action to
address releases of hazardous wastes and hazardous constituents at or from a facility (or, in
accordance with RCRA § 3004(v), "beyond the facility boundary"). However, they differ in
several important respects:
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• RCRA § 3004(u) corrective action may be required only at facilities which have a
RCRA operating or post-closure permit. RCRA § 3008(h) may be used at facilities
which are "authorized to operate under [RCRA § 3005(e)]." In other words, RCRA §
3004(u) is the "permitting" corrective action; RCRA § 3008(u) is the "Interim Status
enforcement" corrective action.
• RCRA § 3004(u) corrective action requirements may be imposed only by permit and
challenged via a -permit appeal under the procedures in 40 CFR Part 124 (and,
ultimately, the Administrative Procedure Act); RCRA § 3008(h) corrective action
requirements may be imposed via administrative order (on consent or unilaterally) or
judicial action. Such corrective action requirements may be challenged via the
procedures in 40 CFR Part 24 (for unilateral orders) or in the context of defending
against a RCRA § 3008(h) judicial action.
• Corrective action under RCRA § 3004(u) can only be required for releases from "solid
waste management units" (SWMUs). The term SWMU is defined in the proposed
Subpart S corrective action rule (55 FR 30,798) (July 27, 1990) as "any discernible unit
at which solid wastes have been placed at any time, irrespective of whether the unit was
intended for the management of solid and/or hazardous wastes." (On the other hand, if
a release cannot be attributed to a SWMU, the "omnibus authority" of RCRA §
3005(c)(3), 40 CFR § 270.32(b)(2), can be used to address such release "as necessary
to protect human health and the environment." See In re: LCP Chemicals - North
Carolina, Inc., RCRA Permit Appeal No. 90-40 (Feb. 14, 1991); In re: American
Cyanamid Co., RCRA Permit Appeal No. 88-22 (October 31, 1989); In re: Amerada
Hess Corp., RCRA Appeal No. 88-10 (August 15, 1989). Corrective action under
RCRA § 3008(h) is not limited to releases from SWMUs; it may be required for releases
anywhere at or from a facility, into the environment.
• Modifications to corrective action requirements in a permit under RCRA § 3004(u) may
be made only in accordance with the procedures for a permit modification in
40 CFR 270.41 and 42. Modifications to corrective action requirements in an order
under RCRA § 3008(h) can be made by consent of the parties (if permitted by the terms
of the order) or by issuance of another order (on consent or unilaterally).
• Corrective action requirements imposed via permit under RCRA § 3004(u) are subject
to the public participation requirements of the RCRA permitting regulations (see 40 CFR
§ 124.10-. 19). There are no statutory or regulatory requirements for public participation
in the issuance of orders for corrective action under RCRA § 3008(h). However,
Agency guidance sets forth public participation requirements for the selection of
corrective measures (generally after the RFI/CMS stage and before the CMI state). See
"Guidance on RCRA Corrective Action Decision Documents: The Statement of Basis,
Final Decision and Response to Comments," OSWER Directive No. 9902.6 (February
1991).
RCRA § 3008(h) should be utilized where corrective action is needed at an "interim status"
facility, but the facility is not seeking a permit (i.e., the owner/operator intends to close the
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facility rather than obtain a RCRA operating permit and a post-closure permit is not required)
or a permit is not expected to be issued in the near future. If an interim status facility is about
to be issued a permit (operating or post-closure), it may make sense to wait and seek corrective
action through the permit rather than via RCRA § 3008(h). If corrective action is required at an
interim status facility under RCRA § 3008(h) prior to issuance of the permit, the region will have
to decide at the time of permit issuance whether to incorporate the terms of the Section 3008(h)
order into the permit (either directly or by reference) and terminate the order, or require the
respondent/permittee to comply with the separate terms of both the order and the permit. (See
"Coordination of Corrective Action Through Permits and Orders" (Aug. 10, 1989)).
Regulations implementing RCRA § 3008(h) (in addition to RCRA § 3004(u) and other
authorities, as appropriate) address facilities that are ineligible for listing on the Superfund
National Priorities List ("NPL"), 40 CFR Part 300, App. B, under the "RCRA/NPL deferral
policy." See FR 21057 (June 10, 1986); "EPA Proposal to Keep Some, Drop Other NPL Waste
Sites Subject to Corrective Action Under RCRA Subtitle C," 51 FR 23978 (June 24, 1988); "EPA
Policy Statement on Determining Unwillingness for Sites Subject to RCRA Subtitle C Corrective
Action on NPL," 53 FR 30005 (August 9, 1988); and "EPA Addition to Policy Statement on NPL
Determinations for Sites Unable to Pay for RCRA Subtitle C Corrective Action," 53 FR 30002
(August 9, 1988).
9.4 RCRA § 3013 MONITORING, ANALYSIS AND TESTING
9.4.1 RCRA § 3013(a) Authority of Administrator
If the Administrator determines, upon receipt of any information, that:
(1) the presence of any hazardous waste at a facility or site at which hazardous waste
is, or has been, stored, treated, or disposed of, or
(2) the release of any such waste from such facility or site
may present a substantial hazard, to human health or the environment, he may issue
an order requiring the owner or operator of such facility or site to conduct such
monitoring, testing, analysis, and reporting with response to such facility or site as the
Administrator deems reasonable to ascertain the nature and extent of such hazard.
9.4.2 Elements of RCRA § 3013(a)
The key elements of RCRA § 3013(a) are discussed below:
• "upon receipt of any information ..."
- Information upon which a reasonable person would base a decision or take action
must be gathered or presented before issuance of an order under § 3013
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- Appropriate sources of information include laboratory analysis of samples;
observations recorded in the course of ah inspection; citizens' complaints;- state or
federal agency records indicating the type and quantity of, waste likely to be found on
site; information received pursuant to requests made under RCRA § 3007 and/or,
CERCLA § 104; other comparable sources of information.
• "...that the presence of any hazardous waste..."
- Unlike RCRA § 3008(h), RCRA § 3013 does not require EPA to demonstrate an
actual release of hazardous waste from a facility; it is enough for EPA to show that
the presence of hazardous waste may present a substantial hazard to human health and
the environment. Thus, RCRA § 3013 can be used in the absence of definite
evidence of a release, where the mere threat of release presents a substantial hazard,
e.g., where it is difficult, if not impossible, to ascertain, without extensive sampling,
analysis, and monitoring, that a release actually occurred
- The term "hazardous waste" as used in RCRA Section 3013 means the statutory
definition set forth in RCRA § 1004(5), 42 U.S.C. § 6903(5), and not the narrower
regulatory definition in 40 CFR § 260.10 and 261.3. See 40 CFR § 261.1(b).
- A Section 3013 order may be used to develop the factual background necessary to
support a 3008(h) action.
• "...or release of [any hazardous] waste..."
- Section 3013 may also be used where there is evidence of an actual release of
hazardous waste
• "...at a facility or site at which hazardous waste is, or has been, stored, treated or
disposed..."
• "...may present a substantial hazard to human health or the environment..."
- Congress used the words "may present" in,RCRA § 3013, rather than "is presenting"
- EPA need show only that there is a possibility or potential of a substantial hazard to
human health or the environment, rather than to show that the hazard actually exists
- Factors to be considered in determining that the presence or release of hazardous
wastes may present a "substantial hazard" include:
Likelihood of a release of hazardous wastes
Manner of release of the hazardous waste from the site (i.e., through ground
water, surface water, air, etc.)
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Characteristics of the waste discharged or threatening to be discharged
Quantity of the waste discharged or threatening to be discharged
Current or potential uses of the portion of the environment affected.
Potential for exposure to humans and the environment
Other related factors.
- "May present a substantial hazard" is a lower standard than "may present on imminent
and substantial endangerment" under RCRA § 7003.
• "...[the.Administrator] may issue an order..."
- Only administrative orders may be issued under RCRA § 3013, though a judicial action
may be filed to compel compliance with an administrative order requiring investigations,
monitoring, etc. under RCRA § 3013
• "...requiring the owner or operator of such facility or site..."
- RCRA § 3013 orders may be issued to the present owner or operator under RCRA §
3013(a). Orders may also be issued to previous owners or operators in, certain
circumstances, as described in RCRA § 3013(b).
• "...to conduct such monitoring, testing, analysis, and reporting with respect to the facility
as the Administrator deems reasonable to ascertain the nature and extent of such hazard."
- Under RCRA § 3013, EPA may require only the conduct of monitoring, testing, and
analysis and reporting. Unlike RCRA § 3008(h) and § 7003, it may not be used to
require actual cleanup or other remediation. However, information obtained under
RCRA § 3013 may be used as a basis for a second order (or a judicial action) seeking
such cleanup or remediation under RCRA § 3008(h) or § 7003.
9.4.3 RCRA § 3013(b) Previous Owner and Operators
RCRA § 3013(b) provides that:
In the case of any facility or site not in operation at the time a determination is
made under subsection (a) of this section with respect to the facility or site, if
the Administrator finds that the owner of such facility or site could not
reasonably be expected to have actual knowledge of the presence of hazardous
waste at such facility or site and of its potential for release, he may issue an
order requiring the most recent previous owner or operator of such facility or
site who could reasonably be expected to have such actual knowledge to carry
out the actions referred to in subsection (a) of this section.
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RCRA § 3013(b) authorizes the issuance of an order against a prior owner or operator under
certain circumstances. Conditipns precedent to issuance of a RCRA § 3013 order to a prior
owner or operator are:
1. The facility or site must be one which is not "in operation" at the time a determination
is made under subsection (a), and
2. The present owner or operator of the facility or site "could not reasonably be expected
to have actual knowledge of the presence of hazardous waste at such facility or site and
of its potential for release."
The term "in operation" should be interpreted so as to allow EPA to gather information
concerning potentially hazardous sites from those in the best position to provide that information.
A facility is not "in operation" if it has been abandoned or is not otherwise being actively
operated as a hazardous waste facility by the current owner or operator.
If the present owner could reasonably be expected to have knowledge of both the presence
of hazardous waste and its potential for release, RCRA § 3013(b) prohibits the issuance of an
order to the previous owner or operator. A reasonable expectation that an individual has
knowledge of the presence of hazardous waste on his land and its potential for .release can be
based on evidence showing the use of the facility during the period of ownership/operation.
9.4.4 RCRA § 3013(c) Proposal
RCRA § 3013(c) provides that:
An order under subsection (a) or (b) of this section shall require the person to whom
such order is issued to submit to the' Administrator within 30 days from the issuance
of such order a proposal for carrying out the required monitoring, testing, analysis,
and reporting. The Administrator may, after providing' such person with an
opportunity to confer with the Administrator respecting such proposal, require such
person to carry out such monitoring, testing, analysis, and reporting in accordance
with such proposal as the Administrator deems reasonable to ascertain the nature and
extent of the hazard.
An order requiring respondent to submit a monitoring, testing, analytical, and reporting
proposal should include the following elements:
• A recitation of the information and facts upon which the order is based
• An assertion of the threat or potential threat to human, health and/or the environment
• A statement of the goals of the. sampling, analysis, and monitoring program which
respondent must propose
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• A notice to respondent of the general areas of concern which must be addressed in the
proposal which respondent must submit
• In the case of a unilateral order, a notice that respondent may submit, in writing, any
legal or technical defenses, objections, or contentions which he may desire to make
• A notice to respondent that he is entitled to confer with EPA regarding' the proposal
which respondent must submit
• Information regarding the name, address, and telephone number of the appropriate EPA
official whom the respondent may contact
• In the case of a consent order, a provision such as:
Respondent agrees to implement the requirements of the work plan set forth
below for carrying out investigative activities including monitoring, testing,
analysis, and reporting at the facility. This work plan has been developed jointly
by EPA and Respondent. EPA and Respondent agree that incorporation of this
work plan in the instant Order satisfies the requirement under § 3013(c) that
Respondent submit a proposal and that EPA provide an opportunity for
Respondent'to confer regarding such proposal.
• A statement that EPA has the right to approve any proposed changes or modifications
made after the initial approval has been given to the proposal
The effect of a § 3013 order includes the following:
• Preparation of a submission for work proposal within 30 days (a request for a conference
with EPA does not alter this 30-day period)
• An order does not in and of itself authorize the respondent to do any sampling, analysis,
or monitoring. Such activities should be conducted only after EPA has approved
respondent's proposal. Of course, any party may sample at, analyze, or monitor its own
property at any time, but if it does so in advance of EPA approval, the results may not
be acceptable to EPA.
• EPA must review respondent's submission and give written notice of whether EPA has
approved the proposal or whether specified modifications are necessary.
9.5 RCRA § 3013(d) MONITORING, ETC., CARRIED OUT BY ADMINISTRATOR
RCRA § 3013(d) provides that:
(1) If the Administrator determines that no owner or operator referred to in
subsection (a) or (b) of this section is able to conduct monitoring, testing, analysis,
or reporting satisfactory to the Administrator, if the Administrator deems any such
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action carried out by an owner or operator to be unsatisfactory, or if the
Administrator cannot initially determine that there is an owner or operator referred
to in subsection (a) or (b) of this section who is able to conduct such monitoring,
testing, analysis, or reporting, he may:
(A) conduct monitoring, testing, or analysis (or any combination thereof) which
he deems reasonable to ascertain the nature and extent of the hazard,
associated with the site concerned, or
(B) authorize a state or local authority or other person to carry out any such
action
and require, by order, the owner or operator referred to in subsection (a) or (b) of
this section to reimburse the Administrator or other authority or person for the
costs of such activity.
(2) No order may be issued under this subsection requiring reimbursement of the
costs of any action carried out by the Administrator which confirms the results of
an order issued under subsection (a) or (b) of this section.
(3) For purposes of carrying out this subsection, the Administrator or any
authority or other person authorized under paragraph (1), may exercise the
authorities set forth in section 6927 of this title.
Situations which may require the use of § 3013(d) authority include the following:
• Where no owner or operator is able to conduct the required monitoring, testing, or
analysis satisfactorily
• Where testing conducted by an owner or operator is determined to be unsatisfactory
• Where it cannot be determined initially whether there is an owner or operator able to
conduct the required monitoring and testing
Once EPA or some other authorized person has performed activities consistent with RCRA
§ 3013(d), an order may be issued to require reimbursement. . A reimbursement order should be
directed to the present owner or operator or the most recent previous owner or operator who
could reasonably be expected to have actual knowledge of the hazardous waste. No
reimbursement order can be issued where EPA's activities merely confirm the , results the
respondent had compiled under a RCRA § 3013(a).or RCRA § 3013(b) order (i.e., where the
Agency has conducted,its testing in the belief that the respondent's results were inaccurate or
unreliable, only to find that the Agency's subsequent tests confirm the owner/operator's test
results).
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9.6 RCRA § 3013(e) ENFORCEMENT
RCRA § 3013 provides that:
The Administrator may commence a civil action against any person who fails or
refuses to comply with any order issued under this section. Such action shall be
brought in the United States district court in which the defendant is located,
resides, or is doing business. Such court shall have jurisdiction to require
compliance with such order and to assess a civil penalty of not to exceed $5,000
for each day during which such failure or refusal occurs.
Referrals of civil actions under RCRA § 3013(e) should follow the format used for other
civil actions.
EPA must have a complete record, of the information forming the basis, for its decisions,
including (if appropriate) documentation of the opportunity afforded the respondents to confer
regarding the required proposal. The following documents should be included:
• Information EPA relied upon to issue the § 3013 order, to modify respondent's proposal,
or to conduct its own monitoring, analysis, or reporting
• Copies of all relevant correspondence between EPA and the respondent
• Written records of conferences and telephone conversations between EPA and
respondents
• Any information which substantiates a claim for reimbursement
• A copy of EPA's response to respondent's proposal.
9.7 RCRA § 7003 IMMINENT HAZARD ("IMMINENT AND SUBSTANTIAL
ENDANGERMENT") ACTIONS
9.7.1 RCRA § 7003 Authority of Administrator
RCRA § 7003 (a), 42 U.S.C. § 6983 (a),.provides that:
Notwithstanding any other provision of this chapter, upon receipt of evidence that the
past or present handling, storage, treatment, transportation or disposal of any solid
waste or hazardous waste may present an imminent and substantial endangerment to
health or the environment, the Administrator may bring suit on behalf of the United
States in the appropriate district court against any person (including any past or
present generator, past or present transporter, or past or present owner or operator of
a treatment,.storage, or disposal facility) who has contributed or who is contributing
to such handling, storage, treatment, transportation or disposal to restrain such person
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from such handling, storage, treatment, transportation, or disposal, to order such
person to take such other action as may be necessary, or both.
A transporter shall not be deemed to have contributed or to be contributing to such
handling, storage, treatment, or disposal taking place after such solid waste or
hazardous waste has left the possession or control of such transporter if the
transportation of such waste was under a sole contractual arrangement arising from
a published tariff and acceptance for carriage by common carrier by rail and such
transporter has exercised due care in the past or present handling, storage, treatment,
transportation and disposal of such waste.
The Administrator shall provide notice to the affected state of any such suit. The
Administrator may also, after notice to the affected state, take other actipn under this
section including, but not limited to, issuing such orders as may be necessary to
protect public health and the environment.
9.7.2 Elements of RCRA § 7003(a) Actions
The key elements of § 7003 are discussed below:
• "Upon receipt of evidence..."
- The region must have all the evidence necessary to demonstrate that the respondent
has handled, treated, stored, transported, or disposed of a solid or hazardous waste,
and that such activity has resulted in a condition that may present an imminent and
substantial endangerment to health or the environment before a RCRA § 7003 order
may be issued.
- Appropriate sources of evidence: Observations recorded in the course of an inspection
or investigation; information received pursuant to requests made under RCRA §
3007, RCRA § 3013, or CERCLA § 104(e); laboratory analysis of samples; citizens'
complaints other supporting information.
- Evidence must be sufficiently probative and reliable to enable a reasonable person to
conclude that issuance of a RCRA § 7003 order is appropriate.
• "...that the past or present handling, storage, treatment, transportation or disposal of any
solid waste or hazardous waste..."
- .RCRA § 7003 may be used to address an imminent and substantial endangerment
which may be presented by past, as-well as present, activities-: RCRA § 7003 applies
to inactive, as well as active, facilities. See United States v. Northeastern
Pharmaceutical and Chemical Company, 810 F.2d 726, 739-41 (8th Cir. 1986);
United States v. Price, 688 F.2d 204, 214 (3rd Cir. 1982); United States v. Ottati &
Goss, Inc., 630 F. Supp. 1361, 1400 (D.N.H. 1985); United States v. Bliss, 667 F.
Supp. 1298, 13.13 (EiD. Mo. 1987).
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- Unlike RCRA § 3008(h) and RCRA § 3013, RCRA § 7003 applies to endangerment
posed by solid waste as well as hazardous waste. The terms solid waste and
hazardous waste refer to their statutory definitions in RCRA § 1004(5) and (27); they
are not limited to the more narrow regulatory definitions in 40 CFR § 260.10 and §
261.2 and .3. See 40 CFR § 261.6(b); 50 FR 627 (January 4, 1985). See also Comite
pro Rescate de la Salud v. Puerto Rico Aqueduct and Sewer Authority, 888 F.2d 180
(1st Cir. 1984), cert, denied, 494 U.S. 1029 (1990); Lincoln Properties, LTD v.
Higgins, 36 ERC 1228, 23 Envtl. L. Rep. 20,665, 1995 WL 217429 (E^D. Cal. 1993)
• "...may present an imminent and substantial endangerment to health or the
environment..."
- "May present" indicates that Congress did not intend to require that the evidence
demonstrate that an imminent and substantial endangerment to public health or the
environment definitely exists. The term "may" is "expansive language" which is.
"intended to confer upon the courts the authority to grant affirmative equitable relief
to the extent necessary to eliminate any risk posed by toxic wastes". United States
v. Price, 688 F.2d 204, 213-14 (3d Cir. 1981).
- A finding of imminent and substantial endangerment only requires a finding that harm
is threatened; actual harm or injury need not be shown. Dague v. City of Burlington,
935 F.2d 1343, 1356 (2nd Cir. 1991).
-' The threat or risk of harm must be imminent and substantial fpr EPA to act under
RCRA § 7003, but the harm itself need not be imminent or substantial. For example,
EPA could act if there exists an imminent and substantial threat that contaminants
might be introduced into a water supply, even though any, harm that would be caused
by such introduction would be manifested after a period of latency. An endangerment
need not be immediate in order to be imminent. An endangerment is imminent if
factors giving rise to it are present, even though the harm may hot be realized for
years. United States v. Conservation Chemical Corp., 619 F. Supp. 162, 194 (W.D.
Mo. 1985).
- An endangerment is substantial if there is some reasonable cause for concern that
someone or something may be exposed to a risk of harm by a release or a threatened
release of a hazardous substance if remedial action is not taken. Id. at 194.
Injunctive relief under § 7003 may be denied "where risk of harm is remote in time,
completely speculative in nature, or de minimis in degree: United States v. Re illy Tar
& Chemical Corp., 546 F. Supp. 1100, 1009 (D. Minn. 1982) (quoting H.R. Rep. N.
1185, 93rd Long., 2nd Sess. 35-36) (holding that injunctive relief may be used to
supplement response actions under other authorities where evidence indicates potential
imminent and substantial endangerment).
- The endangerment may be to either health or the environment. . The term
"environment" is not defined in RCRA. "However, it presumably encompasses the
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air, soil, and water, including groundwater." Lincoln Properties, LTD. v. Higgins, 36
ERC 1228, 23 Envti; L. Rep. 20,665, 1995 WL 217429 (E D. Cal. 1993).
- Factors to consider when determining whether an imminent and substantial
endangerment exists: Nature and amount of the hazardous substance; the potential
of exposure to humans or the environment to the substance; the known or suspected
effect of the substance on humans or that part.of the environment subject to exposure
to the substance.
- The nature of the endangerment and the basis for the finding that such endangerment
is imminent and substantial should be set forth in the order. The evidence supporting
the finding of imminent and substantial endangerment may be compiled into a single,
concise document constituting the "endangerment assessment."
• "...the Administrator may bring suit...against any person (including any past or present
generator, past or present transporter or past or present owner or operator of a treatment,
storage or disposal facility) who has contributed or who is contributing to such handling,
storage, treatment, transportation or disposal...or order such person to take such action
as may be necessary, or both."
- Judicial Enforcement — Although a resulting judicial order or consent decree can
be quickly enforced if violated, referring the case to Department of Justice and filing
the necessary legal papers may ultimately delay the initiation of remedial activities
- Administrative Enforcement — Administrative orders are relatively speedy. The
general rule is that an administrative order, whether issued unilaterally or on consent,
is appropriate absent some indication that the respondent will not comply with its
terms.
- The term "persons" includes:
Any past,or present, generator, transporter, or owner/operator of a TSD
Any person who has contributed or is contributing to handling, storage,
treatment, transportation or disposal of a solid or hazardous waste which may
present an imminent and substantial endangerment. "[T]he relevant legislative
history supports a broad, rather than a narrow construction of the phrase
'contributed to'." United States v. Aceto Agricultural Chemicals Co., 872 F.2d
1373, 1383-84 (8th Cir. 1989)
A person need not have been negligent to be liable; liability is strict.
- Elements of an order include:
A statement of the statutory basis for the order
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A statement of the agency's authprity to issue the order and the liability that
may be incurred if the respondent fails to comply (i.e., notice of civil
penalties)
A specific determination supported by findings or reference to a separate
endangerment assessment that states that the Agency has determined that an
imminent and substantial endangerment may exist
A finding that the substances are solid or hazardous wastes
Statements as to the liability of the respondents (i.e., that the respondent is or
has been engaged in the activities described in RCRA § 7003)
A compliance schedule that clearly sets forth the tasks to be performed, the
time frames for performance, and the quality and performance standards for
tasks
A statement that EPA has authority to -be on site during work, to obtain split
samples and other information generated, and to stop work if an emergency
arises
Health and safety procedures to be followed
If the order is unilateral,- notice that respondent has an opportunity to confer
with EPA. Agency policy is to offer respondents an opportunity to confer
with the Agency concerning both the appropriateness of the order and its
applicability to respondent. The administrative record on which the decision
was based to issue the § 7003 order should be made available to respondent.
The presiding Agency official should compile a written summary of any
conferences.
Notice of the effective date of the order, ordinarily within 10 to 14 days of
receipt by respondent
Provision exempting EPA from liability for damages, even if the damages
occurred pursuant to the EPA enforcement order
Notice of a public comment period for. consent orders
A statement of EPA's authority to take additional enforcement action if
respondent does not comply with the terms of the order.
• "The Administrator shall provide notice to the affected state of any such suit..."
- There is no. statutory period of time in which such notice must be given. Normal
practice is to provide written notification to the state at least one week before the
federal action. Where a more rapid response in necessary, an abbreviated notice
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period or even a telephone call will satisfy the notice requirement; however, written
confirmation should follow any oral notice.
- Notification should be directed to the director of the state agency having jurisdiction
over environment protection in the affected state, unless the state has designated
another person to receive the notice.
- An "affected state" is a state in which the conduct or condition which may present an
imminent and substantial endangerment is occurring or is located, and/or in which the
response activity required by the proposed order will be taken. More than one state
may be an "affected state" (i.e., where a facility is located near the border of one state
and the wastes may have migrated from the facility into another state).
9.7.3 RCRA § 7003(b) Violations
RCRA § 7003(b) provides that:
Any person who willfully violates, or fails or refuses to comply with any order of the
Administrator under subsection (a) of this section may, in an action brought in the
appropriate United States district court to enforce such order, be fined not more than
$5,000 for each day in which such violation occurs or such failure to comply
continues.
9.7.4 RCRA § 7003(c) Immediate Notice
RCRA § 7003(c) provides that;
Upon receipt of information that there is hazardous waste at any site which has
presented an imminent and substantial endangerment to human ¦ health or the
environment, the Administrator shall provide immediate notice to the appropriate'local
government agencies. In addition, the Administrator shall require notice of such
endangerment to be promptly posted at the site where the waste is located.
9.7.5 RCRA § 7003(d) Public Participation in Settlements
RCRA § 7003(d) provides that:
Whenever the United States or the Administrator proposes to covenant not to sue or
to forbear from suit or to settle any claim arising under this section, notice, and
opportunity for a public meeting in the affected area, and a reasonable opportunity to
comment on the proposed settlement prior to its final entry, shall be afforded to the
public. The decision of the United States or the Administrator to enter into or not to
enter into such Consent Decree, covenant or agreement shall not constitute a final
agency action subject to judicial review under this chapter or subchapter II or chapter
5 of Title 5.
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9.8 RCRA § 3007(a) INSPECTION AND INFORMATION-GATHERING
9.8.1 RCRA § 3007(a)
Section 3007(a) of RCRA, 42 U.S.C. § 6927(a), grants EPA (and authorized states) certain
inspection and information-gathering authorities. Specifically, that section provides that:
For purposes of developing, or assisting in the development of any regulation or
enforcing the provisions of this chapter, any person who generates, stores, treats,
transports, disposes of, or otherwise handles or has handled hazardous waste shall,
upon request of any officer, employee or representative of the Environmental
Protection Agency, duly designated by the Administrator, or upon request of any duly
designated officer, employee or representative of a state having an authorized
hazardous waste program, furnish information relating to such wastes and permit such
person at all reasonable time to have access to, and to copy all records relating tp such
wastes. For the purposes of developing or assisting in the developing of any
regulation or enforcing the provisions of this chapter; such officers, employees or
representatives are authorized:
(1) to enter at reasonable times any establishment or other place where hazardous
wastes are or have been generated, stored, treated, disposed of, or transported
from;
(2) to inspect and obtain samples from any person of any such wastes and
samples of any containers or labeling for such wastes.
Each such inspection shall be commenced and completed with reasonable promptness.
If the officer, employee or representative obtains any samples, prior to leaving the
premises, he shall give to the owner, operator or agent in charge a receipt describing
the sample obtained and if requested a portion of each such sample equal in volume
or weight to the portion retained. If any analysis is made of such samples, a copy of
the results of such analysis shall be furnished promptly to the owner, operator, or
agent in charge.
9.8.2 Important Features of RCRA § 3007(a)
Important features of RCRA § 3007(a) authority include the following:
• The purposes of access/information gathering are limited to development of RCRA
regulations and enforcing RCRA.
• Access/information may be obtained only from persons who generate, store, treat,
transport, dispose of or handle (or have handled) hazardous wastes.
• Authority may only be exercised by a duly designated officer, employee or representative
of EPA or an authorized state.
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• Access/information must relate to "such wastes."
• May obtain information relating to such waste; have access to and copy records; enter
any establishment or place where hazardous wastes are or have been generated, stored,
treated, disposed of or transported from; inspect and obtain samples of such wastes,
containers and labels.
• Owner/operator must be given a receipt for samples taken and an opportunity to take
split samples.
• Copies of any analytical results must be furnished to owner/operator.
9.8.3 Use of CERCLA § 104(e) Information-Gathering Authorities in RCRA
Enforcement Contexts
The information-gathering authority under CERCLA is set forth in Section 104(e), 42
U.S.C. § 9604(e).
In certain circumstances, it may be appropriate and advantageous to rely on CERCLA §
104(e), in tandem with or in lieu of RCRA § 3007(a), to obtain information for a RCRA
enforcement action. In some respects, CERCLA's information-gathering authority is broader than
that of RCRA Exhibit 9-3 provides a brief comparison. TSCA Section 11 also provides EPA
with extremely broad inspection authority and has, on occasion, been utilized to develop
information leading to the filing of enforcement actions under other media.
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Exhibit 9-3. Comparison of CERCLA & RCRA Information-Gathering Authorities
RCRA
CERCLA
Purpose
RCRA § 3007(a) may be used only for the
purpose of developing or assisting in the
development of any regulation or enforcing
the provisions of RCRA.
CERCLA § 104(e) may be used only for the purposes of
determining the need for response, or choosing or taking any
response action under CERCLA, or otherwise enforcing
CERCLA. The right to enter and inspect property and obtain
samples may be exercised only if there is a reasonable basis to
believe there may be a release or threat of release of hazardous
substances or may be release or threat of release of hazardous
substance or pollutant or contaminant.
Recipient
Under RCRA § 3007(a), EPA may seek
information from any person who
generates, stores, treats, transports,
disposes of, cjr otherwise handles or has
handled hazardous waste.
Under CERCLA § 104(e), EPA may seek information from any
person who has or may have information relevant to the matters
described in "Type of Information," below.
Type of Information
Under RCRA § 3007(a), EPA may seek
information "relating to" the generation;
storage, treatment, transportation, disposal
and handling of hazardous waste.
Under CERCLA § 104(e), EPA may obtain information or
documents relating to: (A) the identification, nature and
quantity of materials which have been or are generated, treated,
stored, or disposed or at a vessel or facility; (B) the nature or
extent of a release or threatened release of a hazardous
substance or pollutants or contaminant at or from a vessel or
facility; and (C) information relating to the ability to pay for
or to perform a cleanup.
Property Which EPA May Enter; Inspect and Sample
Under RCRA § 3007(a), EPA may enter,
at reasonable times, any establishment or
other place where hazardous wastes are or
have been generated, stored, treated,
disposed of, or transported from; EPA may
inspect and obtain samples of any such
wastes and any containers or labeling for
such wastes.
Under CERCLA § 104(e), EPA may enter, inspect and obtain
samples from any vessel, facility, establishment, or other place
or property: (A) where any hazardous substance or pollutant or
contaminant may be or has been generated, stored, treated,
disposed of, or transported from; (B) from which or to which a
hazardous substance or pollutant or contaminant has been or
may have been released; (B) from which or to which a
hazardous substance or pollutant or contaminant has been or
may have, been released; (C) where such release is or may be
treated; and (D) where entry is needed to determine the need for
response or the appropriate response or to effectuate a response
action under CERCLA, as well as any vessel, facility,
establishment, place, property, or location which is adjacent
thereto. EPA is also authorized to inspect and obtain samples
from any location of any suspected hazardous substance or
pollutant or contaminant, and of any containers or labels for
suspected hazardous substances or pollutants or contaminants.
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RCRA Civil and Criminal Enforcement:
"Tools of the Trade"
Exhibit 9-3. Comparison of CERCLA & RCRA Information-Gathering Authorities
(continued)
RCRA
CERCLA
Requestor
RCRA § 3007(a) information-gathering
authorities may be exercised by any
officer, employee or representative of EPA
duly designated by the Administrator, and
any duly designated officer, employee or
representative of an authorized state.
CERCLA § 104(e) information-gathering authorities may be
exercised by an officer, employee, or.representative of the
President, duly designated by the President, and any duly
designated officer, employee or representative of state or
political subdivision under a contract or cooperative agreement
with EPA under CERCLA § 104(d)(1).
Note: Most information-gathering authorities under RCRA §
3007(a) and CERCLA § 104(e) have been delegated to the
Regional Administrator, some with Headquarters consultation
requirements. Some Regional Administrators have further
delegated these authorities. Check your Headquarters and
Regional Delegations Manuals.
Enforcement
RCRA § 3007(a) information requests may
be enforced under RCRA § 3008(a) and
(g). Failure to comply with such a request
may result in appropriate injunctive relief
and the imposition of a civil penalty up to
$25,000 per day of noncompliance.
CERCLA § 104(e) information requests may be enforced by
issuance of an administrative compliance order directing
compliance under CERCLA § 104(e)(5)(A). The order may be
issued after notice and opportunity for consultation as is
reasonably appropriate under the circumstances. In addition, a
request for information or order requiring compliance with such
a request under CERCLA § 104(e) may be enforced judicially
under CERCLA § 104(e)(5)(B); the court may order injunctive
relief and/or a civil penalty of up to $25,000 per day of
noncompliance for unreasonable failure to comply.
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10. BANKRUPTCY FOR RCRA ATTORNEYS
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Bankruptcy for RCRA Attorneys
• Become familiar with substance and
procedure of bankruptcy proceeding
• Discuss impact of bankruptcy proceedings on
environmental enforcement cases and cost
recovery actions
• Understand framework for identifying and
addressing bankruptcy issues
• Identify resources that can be used to address
bankruptcy issues
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Most Important Concepts
of the Class
A bankruptcy proceeding DOES NOT shield
the owner or operator of a regulated facility
from the obligation to comply with RCRA
requirements.
Bankruptcy IS NOT an excuse for failure to
comply with environmental requirements.
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r
Chapter 7 -
The Liquidation Chapter
A
• Assets of debtor (if any) sold and distributed
to creditors
• Role of the trustee and attorney for estate
• No asset cases (individuals)
• Trustee's duties
- Sell tangible assets
- If lien exceeds value of asset, may allow secured
. creditor to obtain title through foreclosure
- Investigate and collect on intangible claims
- Generally does NOT operate debtor's business
V
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Chapter 11'-
the Reorganization Chapter
• Debtor allowed to pay off creditors at less
than 100%
• Debtor continues operations during and after
bankruptcy
•, No trustee, unless appointed by court for
cause
• Unsecured creditors committee
• Examiner
• Disclosure statement and plan of
reorganization
Notes:
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The Automatic Stay of
11 U.S.C. Section 362
• Broad stay of litigation, lien enforcement,
and other actions
• Applies AUTOMATICALLY upon filing of
any bankruptcy proceeding
• Designed to preserve the status quo upon
bankruptcy filing and allow orderly handling
of claims against debtor
• Halts ongoing litigation and prohibits new
litigation and enforcement of liens, without
bankruptcy court approval
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A
Major Exceptions to Automatic Stay
(Important to Government)
• Actions by a governmental unit to enforce
police or regulatory powers and to enforce
related nonmonetary judgments (such as
injunctions) are NOT subject to the stay.
• This exception does NOT allow enforcement
of monetary judgments or efforts to obtain
possession or control over property of
debtor; these actions are stayed.
y
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Filing a Proof of Claim
• Government must file proof of claim in order
to share in the distribution of the assets of the
bankruptcy estate.
• Bar date (deadline for filing proof of claim)
- Chapter 7: Fast! 90 days after first meeting of
creditors. Meeting occurs 20 to 40 days after
filing of bankruptcy petition. .
— Chapter 11: Fixed by order of bankruptcy court.
May be in initial bankruptcy notice or in plan of
reorganization.
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Relevant Factors in Deciding Whether to File a
Proof of Claim
• Nature and size of EPA's claim
• The size of the bankruptcy estate and nature
and size of other claims against the debtor
• Other considerations
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Priority of EPA Claims-Penalties
• When does a penalty claim arise for
bankruptcy purposes?
• Pre-petition conduct: Penalties are generally
paid with or after unsecured claims.
• Post-petition conduct: Much more favorable!
Penalties are generally considered
administrative expenses, which are paid
before all other claims except secured claims.
Notes:
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EPA Claims -
Response Costs
A
• When were response costs incurred?
• Pre-petition costs: Response costs are
generally paid with unsecured claims.
• Post-petition costs: Response costs incurred
by EPA are treated as administrative
expenses! It is more difficult for private
parties to obtain priority because of their
joint liability
V
J
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f \
The Bankruptcy Discharge
• In bankruptcy, debts are usually discharged.
• Effect of the discharge: The debt is no longer
enforceable against the debtor.
• What is a debt?
- Debt is liability on a claim.
- Gaim is any right to payment, or any right to an
equitable remedy for breach of performance if
such breach gives rise to a right to payment in the
alternative.
Notes:
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Abandonment of Property
• Abandonment of property allowed when
property is burdensome or of inconsequential
value and benefit to the estate
• If allowed, property no longer considered
property of the bankruptcy estate; becomes
the property of the debtor or party with an
interest in it
• Effect: Response costs incurred no longer
have administrative priority because they no
longer benefit the bankruptcy estate
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Relevant Factors in Deciding Whether to Oppose
Motion to Abandon Contaminated Property
• Extent of unencumbered assets in
bankruptcy estate available to fund response
actions
• Nature of environmental threat
• Value of the property
• Conditions to abandonment
V
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Discharge of Penalties
Discharge of penalties depends on whether
the debtor is an individual or a corporation.
Individuals: Penalties against individuals
generally are NOT discharged.
Corporations
- Chapter 7: Penalties are not discharged.
- Chapter 11: Penalties generally are discharged.
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Discharge of Response Costs
• Discharge of response costs depends on the
following factors:
- The extent to which the claim for response costs is
considered to have arisen
- Whether the debtor is an individual or
corporation
- Whether the debtor continues to own the
contaminated property after bankruptcy.
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Discharge of Response Costs (Continued)
Whether claim for response costs has arisen
is determined by the "fair contemplation of
the parties" test.
Notes:
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Wilson Jones* Quick Reference Index System
© 1991 Wilson Jones Company
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10. BANKRUPTCY FOR RCRA ATTORNEYS
Background Materials
&EPA
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10. BANKRUPTCY FOR RCRA ATTORNEYS
10.1 INTRODUCTION
This module, which consists of the document A Bankruptcy Primer for the Regional
Attorney (U.S. EPA, February 1994) prepared by the National Bankruptcy Lead Region
Workgroup, provides an overview of the Bankruptcy Code1 as it relates to enforcement, cost
recovery, and other proceedings under environmental statutes, including the Resource
Conservation and Recovery Act (RCRA). The module suggests factors to be considered by
regional attorneys in evaluating whether the U.S. Environmental Protection Agency (EPA) should
pursue collection of costs or penalties against debtors who are liable or potentially liable parties
under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA)
or owners and operators of facilities regulated under other environmental statutes or to otherwise
participate in a debtor's bankruptcy case.
Appendix A to this module presents a roster of the current Workgroup members, who also
serve as the regional bankruptcy contacts. Appendices B and C provide several proposed model
documents prepared by the Workgroup that may help regional attorneys handle bankruptcy
matters. Appendix D presents a comprehensive outline and case summary on environmental
enforcement and the bankruptcy laws prepared by the Department of Justice (DOJ).
This module is intended exclusively for use by EPA employees. It does not constitute
rulemaking by the Agency and may not be relied upon to create a right or benefit, substantive
or procedural, enforceable at law or in equity, by any person. The Agency may take action at
variance with this module. In addition, this module does not constitute EPA guidance. EPA is
in the process of drafting proposed guidance addressing the participation of EPA in bankruptcy
cases. EPA has previously issued guidance relating to bankruptcy matters entitled Guidance
Regarding CERCLA Enforcement Against Bankrupt Parties, OSWER Directive #9832.7 (May
24, 1984) and the Revised Hazardous Waste Bankruptcy Guidance, OSWER Directive #9832.8
(May 23, 1986). These guidance documents may be outdated, however.
10.2 THE BANKRUPTCY PROCESS
It has been recognized that there is a conflict between the policies and goals reflected in
the Bankruptcy Code and the environmental statutes, in particular the Comprehensive Response,
Compensation, and Liability Act, 42 U.S.C. § 9601 et seq. (CERCLA). "The conflict begins at
a basic level, since the goal of CERCLA - cleaning up toxic waste sites promptly and holding
liable those responsible for the pollution - is at odds with the premise of bankruptcy, which is
to allow debtors a fresh start by freeing them of liability" (In re Combustion Equipment
Associates, Inc., 838 F.2d at 37 (2nd Cir. 1988)).
CERCLA and the Bankruptcy Code also differ significantly in timing. One of CERCLA's
goals is the quick cleanup of hazardous waste sites without the delays associated with litigation
over the Agency's choice of a response action (42 U.S.C. § 9613(h)). In contrast, litigation is
1. Bankruptcy Reform Act of 1978, Pub. L. No. 95-59.8, 92 Stat. 2549 (1978) (codified as amended at 11
U.S.C. §§ 101-1330).
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accelerated under the Bankruptcy Code, and the bankruptcy court may seek to estimate contingent
or unliquidated liabilities, including liabilities arising under CERCLA (11 U.S.C. § 502(c)).
In order to evaluate how EPA should proceed in light of a particular bankruptcy case, a
brief overview of the bankruptcy process is in order. It is important to note that the Bankruptcy
Code is a comprehensive statutory scheme that is intended to override certain provisions of law
that would otherwise apply in the absence of bankruptcy (United States v. LTV Corporation (In
re Chateaugay), 944 F.2d 997 (2nd Cir. 1991)). The types of bankruptcies most frequently
encountered in environmental cases are those filed under Chapters 7 and 11 of the Bankruptcy
Code; therefore, the following discussion is limited to these types of bankruptcy cases.
10.2.1 Chapter 7—The Liquidation Chapter
In a Chapter 7 bankruptcy case, the debtor liquidates, the assets of the debtor are sold, and
the proceeds are distributed to creditors in accordance with the priority scheme set forth in the
Bankruptcy Code.
The Trustee
A trustee is appointed in every Chapter 7 case.2 The United States Trustee appoints
Chapter 7 trustees from a panel comprising qualified individuals who are willing to serve (11
U.S.C. § 701). Usually, the individuals selected to serve on the panel are local attorneys
practicing in the" bankruptcy area. Chapter 7 trustees are appointed on a rotational basis as the
cases are filed.
The Chapter 7 trustee presides over the Section 341 meeting,3 which may be scheduled as
many as 2 months after the bankruptcy case is filed. Sometimes, the Chapter 7 trustee will be
involved in a case prior to the Section 341 meeting; however, his/her first exposure to a case is
usually at the 341 meeting.
Once a Chapter 7 bankruptcy is filed, the trustee must be consulted on matters involving
property of the bankruptcy estate, such as access and related issues.
No Asset Cases
Many Chapter 7 cases are no asset cases. Individual debtors are permitted to exempt certain
property from the bankruptcy estate and, often, there are no assets left after allowed exemptions.
In these types of cases, the trustee files a report of no distribution at the conclusion of the
2. When the Chapter 7 trustee is first appointed he/she is the "interim trustee" (11 U.S.C. § 701). At the
Section 341 meeting (Footnote 3, below), creditors may elect their own trustee. If no trustee is elected, the
"interim trustee" becomes the "trustee" (11 U.S.C. § 702).
3. Section 341 of the Bankruptcy Code provides that a meeting of creditors must be held in every bankruptcy
case within a reasonable time after the order for relief has been entered. The filing of a voluntary bankruptcy
petition constitutes an order for relief (11 U.S.C. § 301). Bankruptcy Rule 2003 provides that the meeting of
creditors shall be held not less than 20 nor more than 40 days after the order for relief.
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Section 341 meeting and, for all intents and purposes, the case is over.4 The trustee is paid a
small fee for his or her services in a no asset case.
Liquidation and Distribution in Asset Cases
In cases where assets need to be administered5 or where further investigation is warranted,
the case remains open. The Chapter 7 trustee typically hires an attorney6 (in some instances,
the trustee hires himself/herself or his/her law firm) to represent the bankruptcy estate. The
trustee's fees and attorney's fees are paid as administrative expenses from unencumbered assets
recovered by the estate.7 If no assets are recovered, the trustee gets paid only the small fee as
in any other no asset case, and the trustee's attorney does not get paid at all.8 In some respects,
every Chapter 7 case is a contingency fee case for the professionals involved.
To administer a case, the Chapter 7 trustee must rely upon the debtor to provide information
and documentation. The Bankruptcy Code requires the debtor to cooperate with the trustee (11
U.S.C. § 521 and Bankruptcy Rule 4002).
In liquidating the estate, the trustee will first sell through auction or private sale tangible
assets, such as equipment, office furniture and machinery, inventory, or real property. If property
is subject to a lien, the trustee must determine whether the value of the property exceeds the
amount of the lien. If it does not, the trustee will often consent to relief from the automatic stay
of 11 U.S.C. § 362 to allow the secured creditor to obtain title to the property through
foreclosure. The trustee may also abandon the property or choose not to administer it. If the
trustee believes that there is equity in the property over the amount of the lien, he/she may, with
court approval, sell it free and clear of liens, with all valid liens to attach to the proceeds of the
4. A no asset case may remain open after the report of no distribution has been filed to deal with matters other
than liquidation of assets, such as objections to discharge.
5. Only an individual debtor may exempt property from property of the bankruptcy estate (11 U.S.C. § 522).
Because a corporation is not entitled to exempt property in a corporate Chapter 7 bankruptcy, any corporate
property having value must be liquidated by the Chapter 7 trustee. If the value of the corporate property is
marginal and the cost of liquidation would exceed any dividend to creditors, the trustee, may abandon the
property. Creditors may be notified of such abandonment in accordance with Section 554. More often, a trustee
will simply not administer the property, and it will be deemed abandoned to the debtor upon closing of the case
(11 U.S.C. § 554(c)).
6. Professionals employed by the trustee must be "disinterested,", may not hold or represent an interest adverse
to the estate, and must be approved by the bankruptcy court (11 U.S.C. § 327).
7. Compensation paid to trustees is limited to a percentage of funds disbursed by the trustee to creditors (15%
of the first $1,000, 6% of the next $2,000, and 3% of any amount over $3,000) (11 U.S.C. § 326). The terms
upon which attorneys and other professionals may be compensated must be approved by the court when they are
employed (11 U.S.C. § 328). Usually, attorneys are paid on an hourly basis at standard hourly rates for services
rendered to the trustee. Fee applications must be filed and heard after notice to creditors and other parties in
interest before such fees can be paid from the estate (11 U.S.C. § 328).
8. Under certain circumstances, a trustee may assess expenses against property subject to a lien of a secured
creditor. 11 U.S.C. § 506(c) allows the trustee to recover from property reasonable, necessary costs and
expenses of preserving or disposing of such property to the extent of any benefit to the secured creditor.
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sale. The property is then sold with a clear title, and the secured creditor is paid from the
proceeds. The Bankruptcy Code requires court approval of such sales after notice and hearing
(11. U.S.C. § 363).
The trustee will also investigate intangible claims such as preference claims,9 fraudulent
transfer claims,10 and accounts receivable and seek to liquidate these claims. This will often
involve litigation. Sometimes the only assets in a case are intangible claims. The trustee will
not know whether funds will be available for distribution to creditors until the litigation is
concluded.
Operation of the Debtor's Business in Chapter 7
A Chapter 7 trustee only will seek to operate the business of the debtor in very limited
circumstances. For example, the trustee may want to operate the debtor's business to complete
work in progress so that he/she then may sell the goods produced as an asset of the bankruptcy
estate. To operate the debtor's business in a Chapter 7 case, the trustee must obtain authorization
from the bankruptcy court (11 U.S.C. §§ 704 and 721) by demonstrating that continued operation
for a limited period is in the best interest of the estate and consistent with the orderly liquidation
of the estate.
Converted Cases
When a Chapter 11 case is converted to Chapter 7, a Chapter 7 trustee is appointed. If the
Chapter 11 case had a trustee,' the same person often will be reappointed as the Chapter 7 trustee.
Converted cases present some unique issues relating to property of the estate and the priority of
claims. Converted cases are further complicated if a reorganization plan was confirmed under
Chapter 11 prior to conversion to Chapter 7.
10.2.2 Chapter 11—The Reorganization Chapter
In a Chapter 11 case, the debtor offers a solution to its financial problems through a plan
of reorganization, which allows the business to continue operating pending the administration of
the bankruptcy case. When the bankruptcy court confirms the debtor's plan, the debtor emerges
from bankruptcy as a new entity, free from debts that were discharged upon confirmation of the
reorganization plan.
The Debtor in Possession
In a Chapter 11 reorganization, the debtor retains possession and control of its assets and
continues to operate its business as a debtor in possession (1.1 U.S.C. § 1107). A trustee may
be appointed in a Chapter 11 case only upon the request of a party in interest or the United
9. Certain transfers made by the debtor on the eve of bankruptcy to a creditor on an antecedent debt may be
recovered by the trustee as preferential transfers under Section 547 of the Bankruptcy Code.
10. Transfers made by the debtor within 1 year of the bankruptcy filing with the intent to defraud creditors or
made while insolvent for less than a reasonably equivalent value may be recovered by the trustee as fraudulent
transfers pursuant to Section 548 of the Bankruptcy Code.
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States Trustee for cause such as fraud, dishonesty, incompetence, or gross mismanagement of the
debtor's affairs by its current management or if such appointment would be in the best interest
of creditors (11 U.S.C. § 1104).
Other Parties
The United States Trustee may appoint a committee of unsecured creditors, usually
comprising creditors willing to serve and holding the largest unsecured claims against the debtor
(11 U.S.C. § 1102): The committee may hire professionals, including attorneys and accountants,
whose fees will be paid as a Chapter 11 administrative expense (11 U.S.C. §§ 1103 and 503).
In some cases, the committee is very active and will negotiate with the debtor on numerous
issues, including the contents of the plan of reorganization. In other cases, the committee may
be inactive or nonexistent. While a government unit may not serve on the committee in most
cases, the United States has served as an ex officio member in some cases."
Typically, the court will appoint an examiner in a Chapter 11 case (11 U.S.C. § 1104) if
there is not sufficient evidence to warrant the appointment of a trustee but the court is not
comfortable with allowing the debtor to continue to operate without some oversight. The duties
of an examiner differ from those of the trustee. The examiner's authority is much narrower and
his/her primary role is to investigate the activities of the debtor and report to the court (11 U.S.C.
§ 1106).
Plan of Reorganization
The debtor's goal in a Chapter 11 case is to formulate a plan of reorganization that will be
acceptable to its creditors and confirmed by the court. In the plan, the debtor essentially
restructures its liabilities and offers a solution to its financial problems.
Parties other than the debtor have the right to file a reorganization plan and to seek
confirmation. The debtor has an exclusive right to file a plan within the first 120 days after the
bankruptcy case is filed, however (11 U.S.C § 1121).
To be confirmed, a plan of reorganization must, among other things, offer creditors at least
as much as they would have received if the case were liquidated under Chapter 7 (11 U.S.C.
§ 1129(a)(7)). In addition, the plan must be feasible (i.e., it is not likely to be followed by
liquidation or the need for further financial reorganization) (11 U.S.C. § 1129(a)(l 1)).
Confirmation also requires each class of creditors holding claims that are impaired under
the plan to accept the plan or the plan must be subject to "cram-down." A claim is considered
"impaired" if under the plan it will not be paid in full or if the legal, contractual, or equitable
terms are otherwise altered (11 U.S.C. § 1124). A plan may be crammed-down (i.e., confirmed
over the objection of an impaired class of creditors) if it does not discriminate unfairly and is fair
and equitable with respect to each class of impaired claims (11 U.S.C. § 1129(a)(7) and (b)(1)).
11. By definition, a "governmental unit" is not a "person" with .limited exception and, therefore, not eligible to
serve on the creditors' committee (11 U.S.C. §§ 1102(b)(1) and 101(41)).
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Confirmation binds the debtor and all creditors to the terms of the plan and operates to
discharge the debtor from any debt that arose before the date of confirmation (11 U.S.C. § 1141).
The debtor may also liquidate under Chapter 11 by filing a liquidating plan (11 U.S.C.
§1123(b)(4)). The same rules regarding confirmation apply to liquidations under Chapter 11
except that confirmation of a liquidating plan does not operate to discharge the debts of a
corporate debtor (11 U.S.C. § 1141).
Disclosure Statement
Creditors cannot be solicited either to accept or reject a plan of reorganization unless prior
to such solicitation they were sent a disclosure statement approved by the court as containing
adequate information sufficient to allow creditors to make informed judgments about the plan (11
U.S.C. § 1125). The disclosure statement should explain how and why the plan of reorganization
will work. The disclosure statement also usually contains information about the debtor's
operations, financial history, and reasons precipitating the bankruptcy filing.
10.2.3 Automatic Stay of 11 U.S.C. § 362
Section 362(a) of the Bankruptcy Code provides for a broad stay of litigation, lien
enforcement, and certain other actions that would affect or interfere with the bankruptcy process.
This stay arises automatically upon filing of the bankruptcy petition and applies in all bankruptcy
cases. The automatic stay is a fundamental part of the bankruptcy process intended to protect
the status quo during the pendency of the bankruptcy case.
Violations of the automatic stay may be punishable by a contempt judgment (28 U.S.C.
§ 1481). Section 362(d) sets forth the basis upon which the bankruptcy court may grant relief
from the automatic stay.
Section 362(b) sets forth certain exceptions to the automatic stay. Actions by a government
unit to enforce its police or regulatory powers and the enforcement of non-monetary judgments
obtained by a government unit to enforce its police or regulatory powers are excepted and,
therefore, are not automatically stayed at the commencement of a bankruptcy case. However,
attempts to enforce monetary judgments or perfect liens or to obtain possession or control over
property of the estate do not fall within this exception and are subject to automatic stay. The
regional attorney should consult with the regional bankruptcy contact and the DOJ bankruptcy
senior attorney on any matters concerning automatic stay issues.
If the automatic stay does not apply, some debtors have asked the bankruptcy court to issue
a discretionary stay under the court's general equitable powers pursuant.to Section 105 of the
Bankruptcy Code. It is the position of the United States that the bankruptcy court does not have
the authority under Section 105 to override the exceptions to the automatic stay under Section
362(b).
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10.3 IMPACT OF BANKRUPTCY ON COMPLIANCE
While a company may continue to operate its business during a Chapter 11 reorganization
proceeding, the Bankruptcy Code does not excuse such a company from its obligation to comply
with environmental laws and regulations. To the contrary, 28 U.S.C. § 959(b) provides that:
...a trustee, receiver or manager appointed in any cause pending in any court of
the United States, including a debtor in possession, shall manage and operate the
property in his possession as such trustee, receiver or manager according to the
requirements of the valid laws of the State in which such property is situated, in
the same manner that the owner or possessor thereof would be bound to do if in
possession thereof.
See State of Ohio v. Kovacs, 469 U.S. 274, 285 (1985) ("we do not question that anyone in
possession of the site...must comply with the environmental laws and regulations of the State of
Ohio. Plainly, that person or firm may not maintain a nuisance, pollute the waters of the State,
or refuse to remove the source of such conditions."); Midlantic National Bank v. New Jersey
Department of Environmental Protection, 474 U.S. 494 (1986) ("Congress did not intend for the
Bankruptcy Code to preempt all state laws that otherwise constrain the exercise of a trustee's
powers.")
Environmental enforcement actions against companies in bankruptcy are generally excepted
from the automatic stay pursuant to the "police power" exemption of 11 U.S.C. § 362(b)(4). In
re Commonwealth Oil Refining Co., 805 F.2d 1175 (5th Cir. 1986) (RCRA § 3008(a) compliance
order issued by EPA was not stayed by virtue of 11 U.S.C. § 362(a), even though compliance
with the order would require the debtor to spend money. United States v. Jones & Laughlin
Steel Corp., 804 F.2d 348 (6th Cir. 1986) (proceeding to modify consent decree relating to
debtor's violations of Clean Water Act and Clean Air Act not stayed by bankruptcy filing); City
of New York v. Exxon Corp., 932 F.2d 1020 (2nd Cir. 1991) (cost recovery case brought by city
excepted from automatic stay up to the point of obtaining a monetary judgment).
Therefore, the filing of a bankruptcy petition by the owner or operator of a regulated facility
does not excuse the obligation to operate and manage the facility in compliance with all
applicable environmental laws and regulations. In addition, it does not prohibit EPA from taking
appropriate enforcement action to compel compliance or to assess a civil penalty, although EPA
should be careful to frame its action so that it falls within the exception to the automatic stay of
Section 362(b). Once a penalty is assessed or a judgment on the penalty is obtained, for
example, the automatic stay prohibits collection activities other than through the bankruptcy
process.
10.4 ASSERTION OF CLAIMS AGAINST A DEBTOR IN BANKRUPTCY
10.4.1 Mechanics of Filing a Proof of Claim
To participate as a pre-petition creditor in a bankruptcy case and to share in any
distribution, a proof of claim must be filed (11 U.S.C. §§ 501 and 502). An exception to this
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rule is in a Chapter 11 case where the claim is accurately included on the debtor's schedules of
liabilities (Bankruptcy Rule 3003(b)(1)).
The deadline for filing a proof of claim is generally referred to as the "bar date" and
operates in some respects as a statute of limitations. In a Chapter 7 case, a proof of claim
typically must be filed within 90 days after the first meeting of creditors (Bankruptcy Rule
3002(c)). The first meeting of creditors is held between 20 and 40 days after the filing of the
bankruptcy petition (Bankruptcy Rule 2003). The initial notice of the bankruptcy filing, which
also includes information regarding the first meeting of creditors, may state that the case is a no
asset Chapter 7 and, therefore, it is not necessary to file a proof of claim within the 90-day
period. If assets are subsequently discovered, creditors will be advised later of a bar date
(Bankruptcy Rule 3002(c)).
The bar date is fixed by order of the court in Chapter 11 cases (Bankruptcy Rule
3003(c)(3)). Sometimes, the bar date will be fixed in the beginning of the Chapter 11 case and
will be set forth in the initial bankruptcy notice. The bar date also may be fixed in the plan of
reorganization. It is important to determine as early as possible if and when a bar date has been
fixed in a case.
There is an official bankruptcy proof of claim form that is usually not used for
environmental matters, given the complexity of most environmental claims. Requests for filing
proofs of claim are made by referral to DOJ. Appendix B presents a model bankruptcy referral
developed by the Workgroup. Referrals should be made as far in advance of the bar date as
possible. However, where the region learns of a bar date that is imminent and there is
insufficient time to prepare a formal referral, the regional attorney should contact the DOJ
bankruptcy senior attorney and refer the matter informally, with a written referral to follow as
appropriate.
10.4.2 Consequences of Filing a Proof of Claim
Timing Issues
When a proof of claim is properly executed and filed, it constitutes prima facie evidence
of the validity and amount of the claim unless a party in interest files an objection (11 U.S.C.
§ 502(a) and Bankruptcy Rule 3001(f)). If an objection is filed, the burden of proving the claim
then shifts to the claimant. Procedurally, an objection to a proof of claim is treated as a
contested matter pursuant to Bankruptcy Rule 9014, but may also be brought as an adversary
proceeding if additional relief is sought (Bankruptcy Rules 3007 and 7001). In any event, if an
objection to the Agency's proof of claim is filed, the matter will be heard by the bankruptcy
court, or by the district court under certain circumstances, on a timetable dictated by the court.
Thus, the Agency may lose the ability to control the timing of its environmental case.
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Sovereign Immunity and Jurisdiction
The filing of a proof of claim by a governmental unit12 constitutes a waiver of sovereign
immunity with respect to claims arising out of the same transaction or occurrence (11 U.S.C.
§ 106(a)). Furthermore, counterclaims by the estate are "core proceedings" as set forth in 28
U.S.C. § 157(d) and are heard by the bankruptcy court unless reference of the matter is
withdrawn to the district court pursuant to 28 U.S.C. § 157(d). The bankruptcy estate may offset
against the allowed claim of a governmental unit any claim that the debtor has against that unit
(11 U.S.C. § 106(b)).
10.4.3 Treatment of CERCLA Claims Under the Bankruptcy Code
Bankruptcy Discharge
Once a debt is discharged in bankruptcy, it cannot be legally enforced against the debtor
(11 U.S.C. § 524(a)). A discharge in a Chapter 7 bankruptcy case discharges an individual
debtor from all debts that arose before the date of the order for relief. In a Chapter 11 case, the
debtor is discharged from all debts that arose before the date of confirmation of the plan of
reorganization (11 U.S.C. §§ 727(b) and 1141(d)(1)(A)). Corporations in Chapter 7 do not
receive a discharge, nor do corporations that liquidated their assets under a plan of reorganization
under Chapter 11.
The term "debt" is defined under Section 101(12) of the Bankruptcy Code as "liability on
a claim." The term ''claim" is broadly defined under Section 1010(5) of the Bankruptcy Code
as:
(A) right to payment, whether or not such right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured, or unsecured; or
(B) right to an equitable remedy for breach of performance if such breach gives
rise to a right to payment, whether or not such right to an equitable remedy
is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured, or unsecured. §101(5).
Discharge of CERCLA Claims in Bankruptcy
The extent to which response costs under CERCLA constitute a "claim" arising prior to
confirmation of a plan of reorganization subject to discharge is of paramount importance. In a
case of first impression, the Second Circuit held that EPA's claim for reimbursement of response
costs under CERCLA arises at the time of the release or threatened release of hazardous
substances and may be discharged in bankruptcy, even though such response costs have not yet
been incurred (United States v. LTV Corporation (In re Chateaugay), 944 F.2d 997 (2nd Cir.
1991)). The court reasoned that future response costs may be estimated pursuant to 11 U.S.C.
12. The term "governmental unit" includes the United States and any department, agency, or instrumentality of
the United States (11 U.S.C. § 101(27)).
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§ 502(c) for the purpose of fixing the amount of EPA's claim for voting in the bankruptcy case.
Under appropriate circumstances, the amount of EPA's claim may be determined in the ordinary
course to be paid according to the terms of the plan of reorganization (Id. at 1006).
More recently, the trend of the courts has been toward adopting a "fair contemplation of
the parties" test for determining when CERCLA claims arise. In In re National Gypsum
Company, 139 Bankr. 397 (D.C. Texas 1992), the court disagreed with the holding in Chateaugay
and held that only those costs associated with pre-petition conduct resulting in a release or threat
of release that "could have been fairly contemplated by the parties" are claims in bankruptcy and
subject to discharge. The court also listed numerous factors to be considered in determining
whether costs associated with pre-petition conduct resulting in a release or threatened release of
a hazardous substance were within the fair contemplation of the parties. The factors included
knowledge by the parties of a site, the National Priority List notification by EPA of liability,
commencement of investigation and cleanup activities, and incurring of response costs.
In In re Jensen, 995 F.2d 925 (9th Cir. 1993), the Ninth Circuit cited with approval
National Gypsum's "fair contemplation" standard, while criticizing In re Chateaugay. In
addition, the Seventh Circuit appears to favor a similar rule. Although it did not cite National
Gypsum and emphasized that it was not establishing a rule on the accrual of a CERCLA claim,
the court in In re Chicago, Milwaukee, St. Paul & Pacific Railroad, 974 F.2d 775 (7th Cir.
1992), stated:
[R]ather than adopting . . . any rule, we explain below that when a potential
CERCLA claimant can tie the bankruptcy debtor to a known release of a
hazardous substance which this potential claimant knows will lead to CERCLA
response costs, and when this potential claimant has, in fact, conducted tests with
regard to this contamination problem, then this potential claimant has, at least, a
contingent CERCLA claim. Id. at 786.
See also In re Chicago, Milwaukee, St. Paul & Pacific Railroad, 3 F.3d 200 (7th Cir. 1993).
Other cases have focused on the amount of information known about the release or
threatened release at the time of the bankruptcy filing or prior to the bar date. For example, in
United States v. Union Scrap Iron & Metal, 123 Bankr. 831 (D.C. Minn. 1990), EPA had notice
of the bankruptcy case and environmental problems at sites owned by the debtor but did not
know about the potential CERCLA liability of the debtor as a generator at another site until after
bankruptcy reorganization. Therefore, the claim was not discharged. In Sylvester Brothers
Development Company v. Burlington Northern Railroad, 133 Bankr. 133 (D.C. Minn. 1991), the
debtor's CERCLA liability was not discharged where notice to the state agency did not identify
CERCLA claims, and knowledge of such claims was obtained only after confirmation of the
debtor's plan of reorganization.
10.4.4 Injunctive Authority
It is important to distinguish between EPA's claim for reimbursement of response costs and
its injunctive authority to issue cleanup orders. Only "debts" that are liabilities on a "claim" may
be discharged in bankruptcy. The bankruptcy definition of "claim" includes the right to an
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equitable remedy for breach of performance if such breach gives rise to a right to payment. If
a breach of performance in response to EPA's injunctive authority to issue cleanup orders gives
rise to an alternative right to payment, then it is subject to discharge. Conversely, if an
injunctive cleanup order is not a claim, it cannot be discharged, and the debtor remains liable for
compliance with the order.
In State of Ohio v.Kovacs, 469 U.S. 274 (1985), the U.S. Supreme Court held that an
environmental injunction issued under state law was a "claim" subject to discharge because the
debtor was not able to do the cleanup work because all of his property was in the exclusive
possession of a receiver and the state was really only interested in a money judgment from the
debtor's post-petition funds. The court noted that:
We do not question that anyone in possession of the site...must comply with the
environmental laws and regulations of the State of Ohio. Plainly, that person or
firm may not maintain a nuisance, pollute the waters of the State, or refuse to
remove the source of such conditions. (469 U.S. at 285)
In United States v. LTV Corporation {In re Chateaugay), 944 F.2d 997 (2nd Cir. 1991), the
Second Circuit held that "a cleanup order that accomplishes the dual objective of removing
accumulated wastes and stopping or ameliorating ongoing pollution emanating from such wastes
is not a dischargeable claim." The court recognized that EPA has the option of undertaking the
cleanup itself and then suing to recover its response costs. The court concluded, however, that
because EPA does not have the option of accepting payment in lieu of continued pollution, "any
order that to any extent ends or ameliorates continued pollution is not an order for breach of an
obligation that gives rise to a right of payment and is for that reason not a claim."
In In re CMC Heartland Partners, 966 F.2d 1143 (7th Cir. 1992), EPA did not file a proof
of claim in the PRP's bankruptcy case but, subsequently, issued a CERCLA § 106 order to the
reorganized debtor based upon its post-reorganization ownership of the property. The court held
that claims based upon a PRP's status as a current, post-confirmation owner of a site at which
harmful releases are threatened or ongoing are not discharged in bankruptcy, even if the acts
contaminating the property occurred pre-confirmation. Under CERCLA, such claims run with
the land.
These cases establish that the obligations imposed by a cleanup order issued to an owner
or operator of contaminated property that orders the respondent to cease threatened or ongoing
pollution will likely not be construed as a dischargeable claim. Whether a cleanup order issued
against a former owner or operator or other party who is not in possession of the contaminated
property should be similarly treated was addressed in In re Torwico Electronics, Inc., 8 F.3d 146
(3rd Cir. 1993). The Third Circuit upheld the issuance of a cleanup order under New Jersey's
ECRA statute against a debtor that formerly leased contaminated property. The court
distinguished Kovacs, noting that in that case, the only performance sought from the debtor was
the payment of money. Here, the court reasoned that there was no alternative payment remedy
under New Jersey law notwithstanding whether CERCLA could have been applied to the site.
The court reasoned that the debtor's liability ran with the hazardous waste that it left behind at
its former facility.
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10.4.5 Private Party Contribution Claims
Private parties face an additional obstacle in recovering response costs from a co-PRP in
bankruptcy. Section 502(e)(1) of the Bankruptcy Code generally provides that any claim for
reimbursement or contribution of an entity that is liable with the debtor is disallowed to the
extent that such claim is contingent. In Syntex Corp. v. The Charter Co. (In re Charter Co.),
862 F.2d 1500 (11th Cir. 1989), the court upheld disallowance of a private party CERCLA
contribution claim where no judgment had as yet been entered in pending environmental litigation
and the claimants had not yet made any payments relating to environmental liability. See also
In re Eagle-Pitcher Industries, 144 Bankr. 765 (S.D. Ohio 1992).
Several courts have struggled to avoid this harsh result. In In re Dant & Russell, Inc., 951
F.2d 246 (9th Cir. 1991), the court addressed a contribution action under Section 107(a)(4)(B)
of CERCLA in which a property owner sought to recover future cleanup costs from a debtor
lessee that had contaminated the owner's property. The Ninth Circuit distinguished between
those cases where EPA had ordered the cleanup and a cleanup instigated by a private party. The
court held that if the cleanup claim was based on CERCLA Section 107(a)(4)(B) and the cleanup
was not ordered by EPA or otherwise being addressed by EPA, there was no co-liability with the
debtor and, therefore, the contingent contribution claim was not barred by virtue of Section
502(e)(1) of the Bankruptcy Code.
In In re Hemingway Transport, Inc., 993 F.2d 915 (1st Cir. 1993), the First Circuit refused
to disallow a contingent contribution claim of a developer who purchased contaminated property
from the debtor. Instead, the court remanded the case directing the bankruptcy court to set a bar
date by which the Chapter 7 trustee and/or the developer could file a claim on behalf of EPA
pursuant to Section 501(c) or (b), respectively, of the Bankruptcy Code.
10.4.6 Penalty Claims
In evaluating a penalty claim, the claim first must be determined to be pre-petition or post-
petition. Generally, the claim is pre-petition to the extent that the act or omission giving rise to
the penalty occurred pre-petition, and it is post-petition to the extent that the act or omission
giving rise to the penalty occurred post-petition. Some types of ongoing violations may give rise
to both pre- and post-petition claims.
In Chapter 7 cases, pre-petition penalty claims are subordinated and will be paid only after
all other claims are paid in full (11 U.S.C. § 726(a)(4)). Therefore, unless assets are sufficient
to fund a full distribution, the likelihood of receiving any payment on a pre-petition penalty claim
in a Chapter 7 case is remote.
In a Chapter 11 case, pre-petition penalty claims are paid in accordance with the terms set
forth in the confirmed plan of reorganization. In some Chapter 11 cases, debtors have agreed
to pay penalty claims as non-subordinated general unsecured claims because such claims may not
be subordinated where the debtor is reorganizing. See, for example, Schultz Broadway Inn v.
United States, 912 F.2d 230, 233 (8th Cir. 1992).
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Post-petition penalty claims are generally considered administrative expenses and have first
priority in payment over any other class of claims other than secured claims (In re N.P. Mining
Co., 963 F.2d 1449 (11th Cir. 1992); United States v. LTV Corporation (In re Chateaugay), 944
F.2d 997 (2nd Cir. 1991); In re Charlesbank Laundry, Inc., 755 F.2d 200 (1st Cir. 1985)). See
also United States Dept. of Interior v. Elliot, 761 F.2d 168 (4th Cir. 1985).
10.4.7 Administrative Expenses
The actual necessary costs and expenses of preserving the bankruptcy estate are
administrative expenses that must be paid in full before any other class of claims are paid
(11 U.S.C. § 503(b)). By definition, administrative expenses must be incurred post-petition
because the bankruptcy estate is created by the filing of the bankruptcy petition.
Response costs incurred by EPA under CERCLA post-petition with respect to property of
the estate may be entitled to administrative priority (United States v. LTV Corporation (In re
Chateaugay), 944 F.2d 997 (2nd Cir. 1991); In re Wall Tube & Metal Products Company,
831 F.2d 118 (6th Cir. 1987); In re Smith-Douglass, Inc., 856 F.2d 12 (4th Cir. 1988)). Note
that it may be more difficult for private parties to establish an administrative priority for post-
petition response costs incurred in a private party cleanup in some circuits (In re Dant & Russell,
Inc., 853 F.2d 700 (9th Cir. 1988); Southern Ry. Co. v. Johnson Bronze Co., 758 F.2d 137 (3rd
Cir. 1985)).
Typically, the procedure for asserting an administrative expense claim is to file an
application for allowance of administrative expenses pursuant to Bankruptcy Rule 2016.
10.5 FACTORS TO BE CONSIDERED IN DECIDING WHETHER TO FILE A
PROOF OF CLAIM
In evaluating whether to proceed with a referral to DOJ for the filing of a proof of claim
against a liable or potentially liable party or the owner or operator of a regulated facility,
consideration of the following factors may be helpful.
10.5.1 Nature and Size of EPA's Claim
Due consideration should be given to the nature and size of EPA's claim. A claim under
CERCLA for reimbursement of all past and future response costs may be more compelling than
a small pre-petition penalty claim where the likelihood of any recovery is remote. Post-petition
penalties and response costs may be accorded administrative priority and, therefore, are more
likely to be paid than are general unsecured claims.
As discussed previously, once a proof of claim is filed, EPA may be required to substantiate
the claim before the court on an accelerated schedule. In addition, EPA may have to respond
to discovery requests and develop expert testimony on the estimate of future response costs on
relatively short notice. The need to allocate resources for such matters should be measured
against the potential gain in filing a claim. For example, in a multi-generator CERCLA case with
potentially hundreds of other viable potentially responsible parties (PRPs), or where other viable
PRPs are already committed to the cleanup pursuant to an administrative order or consent decree,
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the resources needed to pursue a claim in bankruptcy may outweigh any anticipated return.
However, the ability to recover against other liable parties, by itself, should not necessarily be
determinative. As discussed earlier, private cost recovery claims for future response costs are
treated as contingent claims for contribution and are disallowed in bankruptcy. Therefore, other
PRPs may be foreclosed from recovering any share of cleanup costs from a co-PRP in
bankruptcy. In the interest of fairness and justice, EPA may choose to file a claim in the
bankruptcy case of a recalcitrant PRP for a multi-generator site.
10.5.2 Size of the Bankruptcy Estate and Nature and Size of Other Claims Against the
Debtor
EPA's claim cannot be evaluated in a vacuum. When possible, due consideration should
be given to the size of the bankruptcy estate and other claims against the debtor. For example,
it is frequently pointless to file a claim in a no asset Chapter 7 case; any recovery in such cases
is impossible.
The debtor's bankruptcy case should be evaluated to determine whether the sole or principal
purpose of the bankruptcy filing is to obtain a discharge of environmental liabilities. Usually,
a debtor in bankruptcy has numerous financial problems, which include environmental liabilities.
If, however, it appears that the debtor is using the bankruptcy proceeding to deal primarily with
environmental claims and has little or no other debt, close scrutiny of the case is warranted.
In an asset case, the task of evaluating with any degree of certainty how much EPA is likely
to recover if it files a proof of claim is problematic and may not be possible until the end of the
bankruptcy case and after the deadline for filing a proof of claim. To evaluate the likelihood of
a recovery, the debtor's assets and liabilities must be analyzed. The bankruptcy schedules may
be misleading. Values assigned by the debtor in the schedules may be unreliable. While the
debtor may have scheduled assets of significant value, only a fraction of that value may be
realized in a liquidation sale. Often, a debtor is given a certain period of time to sell property
subject to a lien in order to realize the "equity." It is difficult to predict whether such efforts will
be successful. Success often depends on luck, as well as on market conditions. Often, the most
valuable assets are intangibles, such as preference claims and fraudulent transfer claims. Only
rarely are these types of claims scheduled. Usually, these claims only are discovered through a
trustee investigation.
It is also difficult to determine the debtor's liabilities early in the bankruptcy case. Proofs
of claim filed by other creditors must be examined and compared against the bankruptcy
schedules. Often, the debtor must be questioned in evaluating claims. Improperly filed claims
or claims subject to a bona fide dispute are common.
Accordingly, it should be recognized that the evaluation of the debtor's assets and liabilities
is tentative and subject to change in many instances.
10.5.3 Other Considerations
All factors considered when deciding whether to take enforcement action in a non-
bankruptcy case should also be considered when deciding whether to file a proof of claim. These
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factors include culpability of the debtor, strength of the evidence against the debtor, deterrence
value of such action, and precedential value of such action and the interests of justice and equity.
10.6 ABANDONMENT
Section 554 of the Bankruptcy Code provides that upon request of the trustee or other party
in interest, the bankruptcy court may allow abandonment of property of the estate when the
property is "burdensome" or "of inconsequential value and benefit to the estate." If abandonment
is allowed, the property is no longer property of the estate and is abandoned to the debtor or
other party with an interest in the property. If abandonment of contaminated property is allowed,
the trustee or debtor may contend that response costs incurred after the abandonment will no
longer have administrative priority status because the cleanup was not necessary to "preserve
property of the estate."
In Midlantic National Bank v. New Jersey Department of Environmental Protection,
474 U.S. 494 (1986), the U.S. Supreme Court held that the trustee's power to abandon property
is not unlimited and may not be allowed in contravention of a state statute or regulation that is
reasonably designed to protect the public health or safety from identified hazards (Midlantic,
474 U.S. at 507). In a footnote, the Supreme Court went on to state:
This exception to the abandonment power vested in the trustee by §554 is a
narrow one. It does not encompass a speculative or indeterminate future violation
of such laws that may stem from abandonment. The abandonment power is not
to be fettered by laws or regulations not reasonably calculated to protect the public
health or safety from imminent and identifiable harm. Midlantic, 474 U.S. at 507,
n. 9.
Since the Midlantic decision, a number of courts have addressed the issue of when
abandonment of contaminated property may be allowed. While no uniform standard has as yet
emerged from these cases, courts generally consider the nature of the environmental threat, the
time that would be involved in any cleanup, and the amount of money available to the estate to
fund any cleanup in determining whether abandonment should be allowed. See, for example, the
following cases: In re FCX, 96 Bankr. 49 (Bankr. E.D.N.C. 1989); In re Peerless Plating Co.,
70 Bankr. 943, (Bankr. W.D. Mich. 1987); In re Anthony Ferrante & Sons, Inc., 119 Bankr. 45
(D. N.J. 1990); In re Smith-Douglass, Inc., 856 F.2d 12 (4th Cir. 1988); and In re Franklin
Signal Corp., 65 Bankr. 298 (D. Minn. 1986).
10.6.1 Factors To Be Considered in Deciding Whether to Oppose a Motion to Abandon
Contaminated Property
In evaluating whether to request DO J to oppose on EPA's behalf a motion to abandon
contaminated property filed by a trustee or other party in interest in a bankruptcy case,
consideration of the following factors may be helpful:
• Whether there are unencumbered assets in the bankruptcy estate that could be used
to fund response actions—In a bankruptcy case with few or no unencumbered assets,
there is little to gain in opposing a motion for abandonment. In cases in which the estate
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has some funds but not enough to pay for all cleanup costs, it may be appropriate to ask
the bankruptcy court to condition the abandonment upon the trustee undertaking certain
tasks, such as maintenance of site security or other limited activity.
• Nature of environmental threat—Due consideration should be given to the nature and
extent of the environmental problems posed by the site. In opposing an abandonment
motion, EPA should be prepared to present evidence, if requested, that the environmental
conditions at the site pose an imminent threat to public health and safety.
• Value of the property—Where there are no other unencumbered assets in the bankruptcy
estate and the property has a value greater than the cost of the cleanup, abandonment
would not be appropriate. EPA might consider not opposing abandonment under such
circumstances, conditioned upon its being granted a lien against the property.
• Conditions to abandonment—In some cases, EPA may want to negotiate conditions to
a proposed abandonment, such as maintenance by the debtor or trustee of temporary
security measures, EPA access, or a stipulation that the abandonment is without prejudice
to the priority of any EPA claims.
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Appendix A
Roster of Workgroup Members
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ROSTER OF WORKGROUP MEMBERS (MAY 1995)
Name & Address
Regional Participants
Region I
Tim Williamson
Office of Regional Counsel (RCG)
U.S. EPA, Region I
One Congress Street
Boston, MA 02203
Region II
Doug Fischer
New York/Caribbean Superfund Branch
Office of Regional Counsel
U.S. EPA, Region II
290 Broadway, 17th Floor
New York, NY 10007-1866
Region III
Wendi Miller
Office of Regional Counsel
U.S. EPA, Region III
841 Chestnut Building
Philadelphia, PA 19107
Region IV
Andrea Madigan (Co-Chair)
Office of Regional Counsel
U.S. EPA, Region IV
345 Courtland Street, N.E.
Atlanta, GA 30365
Region V
Roger Grimes
(CM-29A)
Office of Regional Counsel
U.S. EPA, Region V
77 West Jackson Boulevard
Chicago, IL 60604-3590
Region VI
Terry Sykes
Office of Regional Counsel
U.S. EPA, Region VI
1445 Ross Avenue, Suite 1200
Dallas, TX 75202-2733
Telephone FAX Number
Number
(617) 565-9016 (617) 565-1141
(212) 637-3180 (212) 637-3155
(215) 597-3230 (215) 597-1195
(404) 347-2641 (404) 347-5246
ext. 2284
(312) 886-6595 (312) 886-0747
(214) 665-2158 (214) 665-2182
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Name & Address
Region VII
Ginny Moore
Office of Regional Counsel
U.S. EPA, Region VII
726 Minnesota Avenue
Kansas City, KS 66101
Region VIII
Susan Nash
Office of Regional Counsel
U.S. EPA, Region VIII
999 18th Street, Suite 500
Denver, CO 80202-2405
Region IX
Lewis Maldonado
Office of Regional Counsel
U.S. EPA, Region IX
75 Hawthorne Street
San Francisco, CA 94105-3901
Region X
Dean Ingemansen
(SO-155)
Office of Regional Counsel
U.S. EPA, Region X
1200 Sixth Avenue
Seattle, WA 98101
Headquarters Participants
Lisa Comer (Co-Chair)
Mail Code 5502-G
John Wheeler
Mail Code 2244
Office of Enforcement—NEIC
Nancy Nibling
Building 53, Box 25227
Denver Federal Center
Denver, CO 80225
Office of General Counsel
Alan Carpien
Mail Code 2366
Telephone FAX Number
Number
(913) 551 -7545 (913) 551 -7925
(303) 294-7590 (303) 294-7653
(415) 744-1342 (415) 744-1041
(206) 553-1744 (206) 553-0163
(703) 603-9068
(202) 260-3056
(303) 236-3636
ext. 556
(202) 260-7217
(703) 603-9117
(202) 260-3069
(303) 236-7573
(202) 260-0584
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Department of Justice Participant
Alan S. Tenenbaum (202) 514-5409 (202) 616-6583
Senior Attorney
Department of Justice
Environment and Natural Resources Division
Environmental Enforcement Section
P.O. Box 7611
Ben Franklin Station
Washington, DC 20044
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Appendix B
Proposed Model Litigation Report
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
REGION
BANKRUPTCY REFERRAL REPORT
DEBTOR:
Name
Address
BAR DATE FOR FILING:
PROOF OF CLAIM (if applicable)
Date
JUDICIAL DISTRICT:
United States Bankruptcy Court
for the District
of
REGIONAL CONTACTS:
Assistant Regional Counsel
Address
Phone Number
Program Contact
Address
Phone Number
CONFIDENTIAL
ATTORNEY WORK PRODUCT PREPARED IN ANTICIPATION OF LITIGATION
DO NOT RELEASE UNDER FOIA, 5 U.S.C. SECTION 552
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EXHIBITS
(If applicable or available)
1. Bankruptcy petition.
2. Bankruptcy schedules and statement of affairs.
3. Notice of bankruptcy filing. (This is often included in the order for meeting of creditors
combined with notice thereof and may also include notice of the bar date.)
4. Order setting bar date. (Sometimes a separate bar order is entered.)
5. Plan of reorganization and disclosure statement. (These documents are filed only in
Chapter 11 cases and usually not until the case has been pending for some time.)
6. SPUR or other cost documentation.
7. Other documents relating to liability of debtor to EPA.
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I. BACKGROUND, DESCRIPTION OF DEBTOR, DESCRIPTION OF SITE/
FACILITY, AND HISTORY OF ENFORCEMENT ACTIVITIES
Briefly describe the debtor and the nature of its activities giving rise to environmental
liability. Include a brief description of the facility or site associated with the debtor and a short
history of enforcement activities.
II. STATUS OF BANKRUPTCY PROCEEDING
Provide a brief history of the bankruptcy proceeding, including the date the bankruptcy case
was filed, the bankruptcy chapter under which the case was filed, the court in which the case is
pending, the case number, the name and address of the debtor's attorney, and, if applicable, the
name and address of the trustee. Describe the current status of the case and highlight any bar
dates or other applicable time limitations..
III. DESCRIPTION OF EPA'S CLAIMS AGAINST THE DEBTOR
Describe EPA's claims against the debtor, including the statutory basis for such claims.
Indicate the extent to which the claims are based upon pre-petition activities of the debtor and
whether any post-petition claim is likely to arise. Provide all available information concerning
the amount of EPA's claim. Include information relating to any possible defenses against the
claim and the rationale for filing the claim.
IV. OTHER ACTION TO BE TAKEN IN THE BANKRUPTCY CASE
Describe any action to be taken other than, or in addition to, the filing of the proof of claim (e.g.,
objection to motion of abandonment, objection to discharge of debtor or dischargeability of debt).
Include the basis for such action and any applicable time limitations on taking such action.
B-3
September 1995
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RCRA Practitioners Enforcement Workshop
Bankruptcy for RCRA Attorneys
Appendix C
Proposed Model Informal Information Request Letter to Debtor
September 1995
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RCRA Practitioners Enforcement Workshop
Bankruptcy for RCRA Attorneys
&EPA UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
REGION IV
345 COURTLAND STREET
Atlanta, GA 30365
Attorney
Address
SUBJ: In re Debtor; U.S. Bankruptcy Court;
District of ; Case No.
Dear :
The United States Environmental Protection Agency (EPA) recently received
in connection with the referenced bankruptcy case, which suggests
that EPA Region has been scheduled as a creditor. However, we have been unable to
identify any pending actions or claims of EPA against this debtor. In lieu of scheduling an
examination in accordance with Bankruptcy Rule 2004, or sending a formal information request
letter pursuant to Section 104(e) of the Comprehensive Environmental Response, Compensation
and Liability Act (CERCLA), 42 U.S.C. § 9604(e) or Section 3007 of the Resource Conservation
and Recovery Act, 42 U.S.C. § 6926, we request that you provide the undersigned with the
following information.
Please state the basis upon which EPA was scheduled as a creditor or has otherwise been
included on the mailing list in the referenced bankruptcy case. Specifically, please identify any
and all sites and/or facilities and the location of such sites and/or facilities that may be associated
with any claims of EPA against the debtor.
Please call the undersigned at with any questions you may have. Your assistance
in this matter is appreciated.
Sincerely yours,
Assistant Regional Counsel
C-l
September 1995
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RCRA Practitioners Enforcement Workshop
Bankruptcy for RCRA Attorneys
Appendix D
Environmental Enforcement and the Bankruptcy Laws—Outline
and Case Summary
September 1995
YS~S~
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ENVIRONMENTAL ENFORCEMENT AND THE BANKRUPTCY LAWS
Outline and Case Summary
Prepared bv:
Joel M. Gross, Deputy Chief-
Alan S. Tenenbaum, Senior Attorney
Environmental Enforcement Section
Environment and Natural Resources Division
United States Department of Justice
January 3, 1995
1. GOALS OF ENFORCEMENT IN THE BANKRUPTCY CONTEXT, include:
—Insure that businesses operating while in bankruptcy do
not do so in violation of environmental lavs.
—Insure that neither the bankruptcy itself nor any steps
taken during the bankruptcy create environmental problems.
—Recover to the extent possible response costs for which
debtor is liable.
—Seek to recover pre-petition penalty claims to the extent
funds are available.
2. THE APPLICABLE BANKRUPTCY LAWS AND RULES are set forth in
the following sources:
— The Bankruptcy Code, 11 U.S.C—applicable to bankruptcies
filed since 1978.
— The Bankruptcy Act—applicable to pre-1978 bankruptcies.
— The Bankruptcy Rules.
— Official Bankruptcy Forms.
— Local Court Rules—will vary from district to district.
— 28 U.S.C. SS 151-58—provisions dealing with bankruptcy
j udges.
— 28 U.S.C. §3 581 et seq.—provisions dealing with United
States Trustees.
— 28 U.S.C. § 959—important provision on suing trustees
and debtors-in-possession and their obligation to
comply with state law in the management and
operation of property of the estate.
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— 28 U.S.C. § 1334--jurisdictional provisions for
bankruptcy and bankruptcy related matters.
-- 28 U.S.C. §§ 1408-1412--venue provisions relating to
bankruptcy.
3. THE THREE TYPES OF BANKRUPTCIES ENCOUNTERED MOST FREQUENTLY•
a. Individual Chapter 7—a liquidation of the debtor's
assets and distribution among creditors based on
priority scheme of the Bankruptcy Code. A trustee will
be appointed to take charge of and liquidate the
debtor's property.
b. Business liquidation--generally done under Chapter 7,
but sometimes done under Chapter 11. If it is a
chapter 7, there will be a trustee. If done under
chapter 11, the debtor will likely remain in possession
of its property.
c. Business reorganization under Chapter 11—a
reorganization to allow the business to continue
operating. Requires proposal and confirmation of a
plan of reorganization. Generally, there will be a
debtor-in-possession and no trustee.
It is important to focus on the type of bankruptcy since the
applicable statutory provisions and rules may vary based on
context, although certain provisions and rules will apply equally
to all Chapters of the Bankruptcy Code and to all types of
debtors. There are also other types of bankruptcies encountered
less frequently in the environmental context, including
individual Chapter 11 proceedings and Chapter 13 proceedings
(wage earner plans).
4. HOW ARE PENALTY CLAIMS DEALT WITH IN BANKRUPTCY?
a. Automatic Stav: Actions for civil penalties for
violation of environmental requirements have been held
not to b« within the scope of the automatic stay of
Section 362(a) of the Bankruptcy Code. That section
generally stays commencement or continuation of any
action that could have been commenced against the
debtor prior to the filing of the bankruptcy petition.
However, Section 362(b)(4) excepts from the stay "the
commencement or continuation of an action or proceeding
by a governmental unit to enforce such governmental
unit's police or regulatory power." Thus, the
government can pursue an action to determine the amount
of penalty. See In re Commerce Oil Co.. 847 F.2d 291
(6th Cir. 1988); Case Summary, Section A(a). Once a
judgment is obtained, it can only be enforced in the
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bankruptcy, since Section 362(b)(5) only allows
enforcement of police and regulatory judgments that are
not money judgments.
b. Filing a Claim: To participate as a creditor in the
bankruptcy, a proof of claim must be filed. Sections
501 and 502. An exception to this rule is that in a
Chapter 11 case, no proof of claiih needs to be filed if
the claim is accurately included, on the debtor's
schedules of liabilities (Rule 3003(b)(1)).
The form for filing a proof of claim is Form 10 of the
Official Bankruptcy forms. Printed forms can be used,
although it may be preferable to use a retyped version
to assist in conforming the form to the facts.
Time for filing a proof of claim is set forth in
the Rules:
Chapter 7 cases—Pursuant to Rule 3002(c), proofs of
claim must be filed within 90 days after the first
meeting of creditors begins. Pursuant to Rule 2003, the
first meeting of creditors will be held between 20 and
40 days after the order for relief, which is the filing
of the petition in a voluntary case.
Chapter 11 cases: The court will fix a deadline for
filing proofs of claim, called a bar date. Rule
3003(c)(3). The court can also extend the bar date for
cause shown.
c. Priority of the Penalty Claim
In Chapter 7 cases, the Bankruptcy Code creates a
priority scheme for distribution of estate property. It
is subject to the "absolute priority rule'*. No creditor
in a lower class gets anything until all creditors in
all higher classes are paid in full, within a class,
payment is pro rata if there is not enough to pay
everyone in full. Secured creditors get paid to the
extent of their collateral prior to any unsecured
creditors. Priorities among unsecured creditors are set
forth in Section 507. After all priority claims are
paid (administrative claims and then other specified
claims including certain wage, employee benefit and tax
claims) other general unsecured claims are paid, except
for those claims listed in Section 726(a)(3)-(5) which
are subordinated, and are paid only after all non-
subordinated creditors are paid in full. The
subordinated claims include pre-petition penalty claims
which are not compensation for actual pecuniary loss.
As a result, penalty claims are subordinated in a
*^8
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Chapter 7 case. That means that penalty claims will
only be paid after all general unsecured claims are
paid in full, i.e.. pehalty claims will often not
receive any significant distribution.
In Chapter 11 cases, payments to creditors are made as
set forth in the plan of reorganization. In Chapter 11
cases, payments to creditors are made as set forth in
the plan of reorganization. In many Chapter 11
reorganization cases, debtors have agreed to pay
penalty claims as nonsubordinated general unsecured
claims in recognition of the fact that such claims are
not likely to be subordinated where the debtor is
reorganizing. Schult2 Broadway Inn v. United
States. 912 F.2d 230, 233 (8th Cir. 1992).
The foregoing deals with pre-petition penalty claims.
Penalties that arise post-petition from the continued
operation of the debtor or from actions of the trustee
should be treated' as administrative expenses, and
entitled to first priority after secured claims. See
Case Summary, Section B(d).
d. Discharge
Whether a penalty claim will be discharged will depend
on the type of bankruptcy.
Individual bankruptcies—An individual debtor
generally receives a discharge from all claims that
arose prior to the filing of the petition. Section
727(b). The discharge operates as an injunction
against pursuing the discharged claim. Section 524.
However, there are exceptions to discharge set forth in
Section 523. One exception is for debts that are
penalties payable to government units which are not
compensation for actual pecuniary loss (the same type
of claim as is subordinated). Section 523(a)(7).
Accordingly, penalty claims are not discharged against
individual debtors. This exception operates
automatically and it is not necessary to object to
discharge of the claim. Section 523(c).
Corporate liquidations—Corporations or other non-
individuals that are liquidating never get discharges.
Sections 727(a) and 1141(d)(3). Thus, it is never-
necessary to consider whether a particular claim is
discharged. Of course, once the corporation has
liquidated, it will be only a shell without assets, so
a preserved claim against the corporation will be of
little or no value.
^7
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Corporate reorganizations—A corporation that
reorganizes gets a discharge for all claims that arose
prior to the date of confirmation of a plan. Section
1141(d)(1). The discharge in this context includes
even those claims that are listed in Section 523 as
being excepted to discharge as to individuals. See
Section 1141(d)(2). As a result, penalty claims
against a reorganizing corporation or other business
entity are generally discharged.
5. HOW ARB COST-RECOVERY CLAIMS TREATED IN BANKRPPTCY?
a. Automatic Stav: Courts have held that the automatic
stay does not apply to actions for recovery of response
costs under Section 107 of CERCLA, because such actions
are within the police or regulatory exception of
Section 362(b)(4). Thus, a cost recovery claim can be
pursued to judgment but can then only be enforced in
the bankruptcy proceeding. See Case Summary, Section
A(c) .
b. Filing a Proof of Claim; Same rules as in 4(b) above.
c. When Do Cost Recovery Claims Arise?;
One issue in this area has been how future response
costs should be treated, or put another way: when does
a cost recovery claim arise for purposes of bankruptcy
law? This issue is relevant to the total amount of the
cost recovery claim and whether all of the claim has
arisen and is dischargeable in bankruptcy. Some
reorganizing companies have argued that the
government's claim should include all liability
relating to pre-petition contamination of a site and
that they should get a discharge and fresh start from
all liability relating to pre-petition contamination of
any site. They argue that "claim" is defined broadly
in Section 101(5) to include even claims that are
unmatured, contingent and unliquidated, and that
Section 502(c) provides for the court to estimate "any
contingent or unliquidated claim, the fixing of which,
as the case may be, would unduly delay administration
of the case. . . " From the Government's perspective,
certain CERCLA cost recovery claims should be found not
Jto have yet arisen because one of the elements of a
CERCLA claim — the incurrence of the response costs —
arguably has not arisen and because the Government may
not otherwise have a fair opportunity to participate in
the bankruptcy proceeding. For example, the Government
may not be aware of a CERCLA site or the Debtor's
connection to the site or may have insufficient
information about the contamination at a site to
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participate meaningfully in the bankruptcy. Even
estimating future response costs may be extremely
difficult if not impossible during the early stages of
the response process.
The Second Circuit court of appeals decision in the LTV
reorganization (In re Chateauaav Corp.! was the first
appellate decision on this issue. The court held that
the pivotal event in the accrual of a CERCLA clean-up
claim for bankruptcy purposes was the release or
threatened release of a hazardous substance.
Recent decisions in Jensen. Chicago. Milwaukee, and
National Gypsum and other cases suggest that where no
response action has been taken or where the government
lacks knowledge of environmental problems at a site or
a debtor's connection to a site, the government's
CERCLA claim has not arisen and is nondischargeable.
In Jensen, the Ninth Circuit held that a the government
must have sufficient knowledge of the debtor's
potential liability for a cleanup claim to arise. In
the Chicago. Milwaukee cases, the Seventh Circuit held
that a CERCLA claim arises when the claimant can tie
the bankruptcy debtor to a known release that the
claimant knows will lead to CERCLA response costs, and
when the claimant has conducted tests with regard to
the contamination problem. In National Gypsum, the
district court held that only cost recovery claims
within the fair contemplation of the parties could be
discharged. See Case Summary, Section C.
d. Secured Status of Cost Recovery Claim; To the extent
that a cost recovery claim is secured by property of
the bankruptcy estate, it will be beneficial to assert
such a security interest, since it will be paid to the
extent of the value of the collateral ahead of all
other creditors, except those with superior secured
interests in the same collateral. Under Section 107(1)
of SARA, the United States is given a security interest
to the extent of its response costs against property of
a liable person which property is subject to or
affected by the response action. (Note that in Reardon
v. United States. 947 F.2d 1509 (1st Cir. 1991), the
Court held that imposition of the CERCLA lien without
an opportunity for any hearing was violative of due
process). The lien is subject to existing liens on the
property. State laws often provide for similar liens
for State response costs.
To the extent that such lien may exist against property
of the debtor, the secured claim will only be secured
Y6/
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to the extent of the value of the property being
cleaned up. In the usual case where the response costs
substantially exceed the value of the property, the
bulk of the cost recovery claim will be unsecured.
Secured claims can only be asserted in a bankruptcy
proceeding to the extent they are perfected prior to
the commencement of the case. Further, Section
362(a)(3), part of the automatic stay provision,
prohibits the perfection of any lien against property
of the estate. This provision is not subject to the
exception for police or regulatory actions.
e. Priority of an Unsecured Cost Recovery Claim;
i. To the extent of costs incurred pre-petition, an
unsecured cost recovery claim will be a general
unsecured claim.
ii. One issue that has been actively litigated is the
priority of response costs incurred post-
petition with respect to property of the
bankruptcy estate. Most courts have held that
such costs are administrative expenses, pursuant
to Section 503, since the trustee or debtor-in-
possession had an obligation to clean up the
property, and the government fulfilled that
obligation. In other words, such costs are
"actual and necessary" costs of operating or
administering the business in accordance with
applicable lav for the benefit of the estate. A
handful of courts have denied administrative
status in private party cases not involving
property of the estate, holding that if the
response costs were in response to pre-petition
contamination, the clean-up costs are a general
unsecured claim. This issue was left undecided by
the Supreme Court in Midlantic National Bank. The
cases on this issue are discussed in Sections B(a)
and (b) of the Case Summary. The strongest facts
for administrative priority status are when the
costs in question are relatively small compared to
the size of the estate; when the response is a
relatively short term, removal type response and
the threat of harm is more immediate and severe;
or when the response was necessitated, at least in
part, by post-petition conduct of the debtor or
the trustee.
The United States has only sought administrative
expense priority for costs incurred post-petition
Ye J
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with respect to property of the estate. We have
not sought administrative priority when the costs
were incurred post-petition with respect to
property that the debtor does not own (such as
property on which its generated wastes were
disposed). To date, no court has allowed an
administrative priority for response costs not
incurred relating to property of the estate.
iii. If an administrative expense is to be sought, the
procedure is to file an application for allowance
of administrative expenses, in accordance with
Rule 2016.
iv. If the court allows response costs as
administrative expenses, those costs would still
be subordinated to the interests of secured
creditors in their collateral. If all the
estate's assets are subject to security interests,
the administrative expenses may not be paid. One
argument to consider in this area is that under
Section 506(c) where the response action at issue
was taken with respect to property in which the
secured creditor has its security interest, the
government should be allowed to recover its
response costs from the proceeds of the secured
property. Section 506(c) allows the trustee to
recover from secured property amounts spent to
preserve the secured property. To the extent the
government fulfills the obligation of the
trustee, it can argue that it stands in the shoes
of the trustee with respect to the secured
property. See Case Summary, Section B(c).
f. Estimation!
Where claims include potential future costs at sites
for which response is ongoing, debtors may seek to have
those costs estimated pursuant to Section 502(c), even
though the future response actions may not have even
been selected. The Second Circuit decision in the LTV
case suggests that such an estimation need not be for
purposes of allowance. The Court stated that "nothing
prevents the speedy and rough estimation of CERCLA
claims for purposes of determining EPA's voice in the
Chapter 11 proceeding, with ultimate liquidation of the
claims to await the outcome of normal CERCLA
enforcement proceedings in which EPA will be entitled
to collect its allowable share (full or pro rata
depending on the reorganization plan) of incurred
response costs." Relying on this language, we have
argued in subsequent cases, that estimation should be
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for purposes of determining plan voting rights only,
and not for purposes of allowance. Allowance should be
determined once response actions for the site have been
selected, with any claim then allowed treated like
other general unsecured claims under the plan of
confirmation. This argument is most likely to be
successful in large bankruptcies where the potential
future costs are not so large as to have their
unliquidated status prevent confirmation of a plan. In
smaller cases, and where the potential future costs
liability is large, the court is more likely to require
estimation for allowance purposes during the
bankruptcy. See Case Summary, Section D(a).
g. Joint and Several Liability
The United States has asserted that CERCLA claims in
bankruptcy should be determined based on the same joint
and several liability principles that apply outside of
bankruptcy. A number of debtors, have argued that
bankruptcy courts have the equitable authority to
allocate liability and only allow a claim for the
amount of the debtor's fair share. Tl^e National Gypsum
decision was the first to address this issue and the
district court held that the debtor's liability would
be determined based on usual joint and several
liability principles. See Case Summary, Section 0(b).
h. Discharge;
Individuals—Pre-petition cost recovery claims
against individuals will be discharged, unless a case
specific exception to discharge can be found. Two
possible exceptions to consider are those of Section
523(a)(3)—that the debt was not timely listed or
scheduled in time to file a proof of claim—or Section
523(a)(6)--that the debt arose from "willful and
malicious injury by the debtor to the. . . property of
another entity." See Case Summary, Section K. If the
latter provision is to be relied on, an objection to
dischargeability must be filed. Section 523(c).
Cost Recovery Claims Against Individuals or
Reorganizing Companies—Whether cost recovery claims
•for costs incurred post-petition will be discharged
raises the issue of when the claim arises, discussed in
part c. above. If response costs were not incurred
prior to the filing of the petition or the government
did not know about a site's environmental problems at
the time of the bankruptcy or of the debtors'
connection to a site, some recent cases hold that the
government's claim has not arisen and is
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nondischargeable. The government should not be
expected to have filed a claim with respect to a site
about which it had insufficient information or that was
not known to be connected to the debtor. Debtors will,
however, likely argue that the claim arose when the
disposal took place pre-petition. See generally Case
Summary, Section C(a). Recently, the United States has
entered into compromises whereby claims for unknown
sites will be handled in the ordinary course of CERCLA
activities in the future but any judgments or
settlements will be paid as general unsecured claims.
See Case Summary, Section D(c).
The foregoing discussion on discharge assumes that the
debtor does not continue to own the contaminated
property after reorganization. If it does, such post-
bankruptcy ownership gives rise to a new CERCLA; claim
for ongoing post-bankruptcy releases or threats of
releases, notwithstanding any previous discharge in
bankruptcy. See the Seventh Circuit's decision in In
re CMC Heartland Partners. 966 F.2d 1143 (7th Cir.
1992) (Case Summary, Section C(a)(3)).
Corporate Liquidation—The corporation does not get a
discharge at all.
Corporate Reorganization—The corporation will be
discharged from all cost recovery claims that arose
prior to confirmation of a plan of reorganization.
Contribution Claims;
i. Claims for contribution, such as those that arise
under CERCLA, may be disallowed in a bankruptcy
proceeding under Section 502(e) of the Code. That
section provides for the disallowance of
contribution claims in three instances, including
where "such claim for reimbursement is contingent
as of the time of allowance or disallowance of
such claim for reimbursement or contribution."
Thus, if a party is seeking to assert a CERCLA
contribution claim against a bankrupt PRP, it may
be crucial that it have already paid money or
performed work. See Case Summary, Section C(b).
In addition, EPA may be in a better position than
the PRPs to obtain a recovery from the debtor by
litigation or settlement. See Case Summary,
Section D(c).
ii. Another issue relating to contribution claims is
when such a claim arises. This issue has
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important ramifications to the question of
discharge. In the Frenville case, the third
circuit held that a contribution claim does not
arise for bankruptcy purposes until the party
asserting the contribution claim has paid out on
its obligation. In re M. Frenville Co.. 744 F.2d
332 (3d Cir. 1984), cert, denied. 469 U.S. 1160
(1985). This decision has been frequently
criticized and has not been widely followed.
Recently, some courts have adopted the fair
contemplation of the parties test discussed in
Part c above in deciding whether contributions
claims have arisen. See Case Summary, Section
C(b) .
CERCIA Coat Recovery Settlements:
i. EPA and some debtors have found it mutually
advantageous to enter into multi-site settlements
with the United States providing for contribution
protection as provided in 42 U.S.C. § 9613(f)(2).
See Case Summary, Section 0(c). EPA or PRPs
implementing remedial action are then able to
obtain significant contributions from debtors
toward hazardous waste cleanup. The debtors have
then sought to disallow the claims of multiple
PRPs as barred under CERCLA. The trend in recent
cases has been to hold that claims under Section
107 of CERCLA are claims for contribution that can
be barred under Section 113(f)(2) of CERCLA, 42
U.S.C. i 9613(f)(2). See Case Summary, Section
C (b) .
ii. In the recent settlements in the U.E. Systems.
Insilco. and LTV bankruptcies, the parties agreed
on a procedure for handling future sites in the
ordinary course of CERCLA activities but to be
paid as general unsecured claims. This was a fair
and reasonable compromise of the parties'
positions that avoided the need for estimation
hearings. See Case Summary Section D(c).
iii. The courts have applied a deferential standard of
review in considering objections to bankruptcy
CERCLA settlements. The courts have approved such
settlements where EPA provides a plausible
explanation for the fairness and reasonableness of
the settlement and the Department of Justice finds
the settlement to be in the public interest after
consideration of public comments. See Case
Summary, Section D(c).
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6. HOW ARE NATURAL RESOURCE DAMAGE CLAIMS DEALT WITH IN
BANKRUPTCY?
Natural resource damage claims will generally be dealt with
in the same manner as cost recovery claims. One separate
issue relates to when a natural resource damage claim arises
for bankruptcy purposes. In the National Gvosum case, we
argued that such a claim could not arise prior to selection
of a remedy for the site, since under CERCLA such a claim
would not be ripe prior to such selection. This argument
was rejected by the district court. Under that decision, if
the natural resource damage claim was within the fair
contemplation of the parties, a dischargeable natural
resource damage claim would exist, even though a remedy has
not been selected. See Case Summary, Section C(d).
7. HOW ARE INJUNCTIVE CLAIMS DEALT WITH IN BANKRUPTCY?
In considering the ramifications of bankruptcy to injunctive
claims, courts have frequently distinguished between
prohibitory injunctions and mandatory injunctions, such as
clean-up orders, which will require the expenditure of money
for compliance. This distinction, and the issue of whether
it is a determinative one, comes up in a number of different
contexts discussed below. It also bears emphasis that the
various issues discussed below are closely interrelated, and
that a decision in this area may discuss several of the
issues.
a. Oblioation of Trustee or Debtor-in-Possession to Comply
with the Environmental Laws: The courts have been
fairly uniform in holding that to the extent that a
debtor engages in business while in bankruptcy, it must
comply with all federal and state environmental laws
regulating its operations. Thus, a company operating
in Chapter 11 could not ignore the requirements of RCRA
with respect to hazardous wastes it generates. See
Case Summary, Section E. The courts have relied, among
other things, on 28 U.S.C. 8 959(b) which requires a
trustee or debtor-in-possession to "manage and operate"
the property in its possession in compliance with all
valid state laws (interpreted to include federal laws
as well). The courts have differed on the obligations
of a trustee who is not operating the business, but is
only liquidating. The use of the word "manage" implies
that more than operation is included. While a number
of courts have adopted this broad interpretation,
others have held that Section 959(b) does not apply to
Chapter 7 trustees. One ramification of this issue,
which relates to the administrative expense issue
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discussed in part 5(e), is whether a Chapter 7 trustee
can be ordered to undertake corrective action, closure
or post-closure under RCRA or to undertake removal or
remedial actions under CERCLA.
Are injunctive claims considered claims for bankruptcy
purposes? Must Proofs of Claim be filed? Can the
injunctions be discharged?
The question of whether an injunction is a "claim" has
important ramifications to a number of issues. First,
only a "creditor" can file a proof of claim and
"creditor" is defined in Section 101(9) to include an
"entity that has a claim against the debtor" that arose
pre-petition. Similarly, the discharge provisions of
Sections 727(b) and 1141 refer to the discharge of
"debts" and Section 101(11) defines "debt" as
"liability on a claim." Thus, only "claims" can be the
subject of proofs of claim and only "claims" can be
discharged."
"Claim" is defined in Section 101(5) to mean:
(A) right to payment, whether or not such right is
reduced to judgment, liquidated, fixed, contingent,
matured, unmatured, disputed, legal equitable, secured,
or unsecured; or
(B) right to an equitable remedy for breach of
performance if such breach gives rise to a right to
payment, whether or not such equitable remedy is
reduced to judgment, liquidated, fixed, contingent,
matured, unmatured, disputed, legal equitable, secured,
or unsecured:
Thus, the key question is whether the injunction at
issue "gives rise to a right to payment."
Prohibitory Injunctions: Since prohibitory injunctions
do not give rise to an alternative right to payment,
such injunctive claims would not likely need to be
included in a proof of claim and would not be
discharged.
Mandatory Injunctions: One of the significant issues
that has been and is being litigated in this area is
the question of when a mandatory, clean-up type,
injunction will be considered to give rise to a right
to payment so as to make it a claim. In Ohio v.
Kovacs. the Supreme Court held that an injunction to
cleanup a hazardous waste site gave rise to a right to
payment against the former site owner, where a receiver
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had been appointed pre-petition to take control of the
site, thereby dispossessing the owner, and where the
State of Ohio was found to be seeking money to clean up
the site. Accordingly, Ohio had a "claim" that was
discharged. The Court appeared to acknowledge that not
every injunction that required the expenditure of money
to comply would give rise to a right to payment.
Subsequent cases have been divided on the extent that
Kovacs should be limited to its facts. Most recently,
in the Chateauaav (LTV) case, the Second Circuit held
that cleanup obligations would not be considered claims
just because they required the expenditure of money and
would not be considered claims if they were intended to
deal with ongoing pollution. A further issue arises as
to whether this analysis is limited to property that
the debtor owns, or whether it would also apply to
previously owned sites and generator sites. In In re
Torwico Electronics. Inc.. the Third Circuit held that
a state injunctive cleanup order could be enforced
against a debtor that no longer owned or actively
operated contaminated real property where the debtor
left behind hazardous waste. See Case Summary,
Sections E, F.
c. Automatic Stay: Pursuant to the police or regulatory
exception of Section 362(b)(4), the automatic stay has
been held not to apply to the commencement or
continuation of environmental actions seeking
injunctive relief. Thus, an injunctive action can be
pursued to judgment. The more difficult issue is
whether the automatic stay prohibits the enforcement of
an injunction that is or has been obtained against the
debtor. Section 362(b)(5) allows the enforcement of
police or regulatory judgments "other than a money
judgment.1* Again, it seems to be undisputed that
enforcement of prohibitory injunctions, which are not
money judgments, would not be subject to the automatic
stay. As to mandatory, clean-up type, injunctions, the
courts have looked at the issue in much the same manner
as the issue of whether an injunction gives rise to
"right to payment" with some courts holding that if the
injunction required the expenditure of money,
enforcement is stayed, and other courts holding that if
money is not sought directly, the judgment is not a
Aoney judgment. See Case Summary, Sections A(a), A(b).
8. AUTOMATIC AKD DISCRETIONARY STAYS—Some Additional Matters
a. Both the automatic stay of Section 362(a) and the
exceptions to the automatic stay of Section 362(b) take
effect without any affirmative conduct. Thus the
Y&f
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government can proceed on an action within the scope of
the "police or regulatory" exception without obtaining
leave of the bankruptcy court.
b. In situations where the automatic stay does apply, a
party can still seek relief from stay under Section
362(d)-(g) and Rule 4001, by motion to the bankruptcy
court.
c. Even where the automatic stay does not apply, the
debtor or trustee may ask the bankruptcy court to issue
a discretionary stay under the court's general
equitable powers pursuant to Section 105. The
standards for issuance of a discretionary stay are the
usual standards for issuance of a preliminary
injunction. The debtor or trustee would have to show,
among other things, irreparable harm and likelihood of
success on the merits. One issue that arises is what
are "the merits" to be considered. One decision (Case
HI) held that the merits are the merits of the
underlying enforcement action. Another decision held
that what had to be shown was a likelihood of success
on whether the enforcement action would interfere with
the bankruptcy adjudication. (Case H5). Cases
discussing the appropriateness of a discretionary stay
of an environmental action or proceeding are discussed
in Section H of the Case Summary.
d. Where there are ongoing violations of the
environmental laws, there is a strong argument that a
discretionary stay should never be appropriate,
particularly since 28 U.S.C. 5 959(b) requires
compliance with otherwise applicable laws. The Courts
have been generally unwilling to stay such actions,
because to do so would be to give preferential
treatment to a company operating in bankruptcy.
9. ABANDONMENT OF CONTAMINATED PROPERTY
The Bankruptcy Code provides in Section 554 that, after
notice and hearing, a trustee or any party in interest may
seek to abandon property that is burdensome to the estate.
If allowed, the property is abandoned to any person with a
possessory interest in the property, including the debtor.
Because abandonment has been perceived by trustees as a
method of avoiding dealing with contaminated property that
may be in the estate, it has been sought in a large number
of cases where the estate includes contaminated property,
and the clean-up costs exceed the property's as-clean value.
In Midlantic National Bank, the Supreme Court held that the
abandonment authority was not unlimited and that abandonment
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of contaminated property should not be permitted in
violation of state law except on conditions that insure the
protection of public health and the environment. The Court
noted, however, that abandonment should not be prevented by
state laws not reasonably calculated tc protect against
"imminent and identifiable" harm. Post-Midlantic decisions
(Section G of the Case Summary) have reached differing
conclusions on the standards governing when abandonment
should be allowed. It would appear, however, that the more
immediate the harm, the more short term the required
cleanup, and the more money available in the estate, the
more likely the court will be to deny abandonment.
It should be remembered that in situations where there are
little if any assets of value in the estate, there may be no
funds available to finance a cleanup even if abandonment is
denied.
10. DISMISSAL OP POTTLE BANKRUPTCIES
In a number of cases (Case Summary, Section I), courts have
dismissed bankruptcies under Section 707, where the courts
have found that because of the limited assets in the estate
and the responsibilities that the estate would have to clean
up contaminated property, no purpose would be served by
continuing the bankruptcy estate. The advantage of such a
dismissal is that it avoids having limited assets of the
debtor spent on administration, and allows all available
assets to go for environmental remediation. A disadvantage
for the government could be that it would eliminate the
government's ability to seek priority under Section 506(c)
of cleanup costs as against the claim of a secured creditor
in the property being remediated.
11. REFERENCE AMP WITHDRAWAL OP REFERENCE TO BANKRUPTCY JUDGES
a. Pursuant to 28 U.S.C. § 1334 the district courts have
"original and exclusive jurisdiction of all cases under
title 11 [the Bankruptcy Code] and original but not
exclusive jurisdiction over civil proceedings arising
under title 11 or arising in or related to cases under
title 11". Thus, bankruptcy jurisdiction resides in
district courts, not the bankruptcy courts. This, and
bther related provisions, were enacted in 1984 in
response to the Marathon Oil decision in which the
Supreme Court had held unconstitutional the prior grant
of bankruptcy jurisdiction to non-Article 3 bankruptcy
judges.
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b. Pursuant to 28 U.S.C. §[ 151 the bankruptcy judges in
each district "constitute a unit of the district court
to be known as the bankruptcy court for that district."
Thus, the bankruptcy court operates as an arm of the
district court.
c. Pursuant to 28 U.S.C. § 157(a), each district court may
provide for the reference of matters within its
bankruptcy jurisdiction to the bankruptcy judges for
that district. Most of the district courts have
provided through a general order of reference, for the
reference of all bankruptcy matters to bankruptcy
judges.
d. Section 157(b) divides the proceedings that arise under
title 11 into two categories. Core proceedings—those
in any of 15 listed categories—are heard and
determined by the bankruptcy judges who can enter
appropriate orders and judgments, subject to appellate
review by the district court under Section 158. Non-
core proceedings—everything other than the 15
categories—are heard by the bankruptcy judge, who then
submits proposed findings of fact and conclusions of
law to the district court, with the final order or
judgment to be entered by the district court.
e. Section 157(d) deals with the withdrawal of the
reference to the bankruptcy judges. It first provides
a permissive withdrawal provision, allowing the
district court to withdraw any case or proceeding from
the bankruptcy court "for good cause shown**. The
second sentence contains a mandatory withdrawal
provision:
"The district court shall on timely motion of a
party so withdraw a proceeding if the court
determines that resolution of the proceeding
requires consideration of both title 11 and other
laws of the United States regulating
organizations or activities affecting interstate
commerce."
This provision can be used to help insure that
substantive environmental issues under federal statutes
are decided by district judges, and not bankruptcy
judges. See Case Summary, Section J. The courts have so
far agreed that the environmental statutes are the type
of commerce-related statutes referred to in Section
157(d). Thus, withdrawal will be appropriate if the
matter to be decided involves both environmental law
and bankruptcy law. Although not required by the
statute, courts have so far required that the matter
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sought to be withdrawn involve "substantial and
material" consideration of the non-bankruptcy statute.
But where such consideration is necessary, withdrawal
is required. Thus, any matter requiring consideration
of the merits of the underlying environmental claim
should be withdrawn. Courts in a number of cases have
also ordered withdrawal over matters raising the issue
of when a CERCLA cost recovery claim accrues for
bankruptcy purposes. Case Summary, Section J. It can
also be argued that resolution of a request for a
discretionary stay, which would require consideration
of the underlying claim sought to be stayed, is
similarly subject to mandatory withdrawal.
f. Bankruptcy Rule 5011(a) provides that a motion for
withdrawal shall be heard by a district judge (although
it is initially filed in the Bankruptcy Court) . Rule
5011(c) provides that the filing of a motion for
withdrawal does not effectuate a stay, and a motion for
a stay should ordinarily be presented to the bankruptcy
j udge.
g. It should be remembered that if withdrawal is granted,
the matter withdrawn will ordinarily be decided by a
district judge in the district where the bankruptcy is
pending.
h. Environmental claims based on state laws only would not
be subject to mandatory withdrawal but could be the
subject of a request for permissive withdrawal, and
could also be the subject of a motion for abstention
under 28 U.S.C. 9 1334(c), which requires such
abstention where a proceeding related to a bankruptcy
case based on state law can be timely adjudicated in a
state court.
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CASE SUMMARY
A. AUTOMATIC STAY — POLICE AND REGULATORY EXCEPTION OP
SECTIONS 362(b)(4) AND (b)(5)
a. Injunctive actions and penalty claims
1. Midlantic National Bank v. New Jersey Dep't of
Environmental Protection. 474 U.S. 494 (1986)
—"Between 1973 and 1978, some courts had
stretched the expanded automatic stay to foreclose
States' efforts to enforce their anti-pollution
laws, and Congress wanted to overrule these
interpretations in its 1978 revisions."
2. Penn Terra Ltd. v. Dept. of Environmental
Resources. 733 F.2d 267 (3d Cir. 1984)
—Pennsylvania could enforce administrative
consent order requiring compliance with state
environmental laws, and correction of prior
violations, against a former coal mine operator in
Chapter 7 bankruptcy; even though compliance
would require expenditure of money, Pennsylvania
was not seeking to enforce a "money judgment"
within scope of Section :62(b)(5) exception to
excerption.
3. United States v. Jones & Lauohlin Steel Corp.. 804
F.2d 348 (6th cir. 1986)
—Clean Air Act and Clean Water Act enforcement
action for civil penalties and injunctive relief
not stayed.
4. In re Commerce Oil Co.. 847 F.2d 291 (6th Cir.
1988)
—Tennessee's claims for penalties for violations
of Tennessee Water Control Act was not subject to
automatic stay.
<5. Tn re Kovacs. 681 F.2d 454 (6th Cir. 1982),
vacated and remanded. 459 U.S. 1167 (1983)
—Sixth Circuit held that automatic stay applied
to enforcement of state order requiring cleanup of
hazardous waste site.
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In re Thomas Solvent Co.. 44 B.R. 83 (Bankr. W.D.
Mich. 1984)
—Enjoining Michigan from enforcing pre-bankruptcy
injunction requiring cleanup of hazardous waste
site against debtor not engaged in ongoing
business.
United States v. ILCO. Inc..
48 B.R. 1016 (N.D. Ala. 1985)
—Injunctive action for cleanup of hazardous waste
site not covered by automatic stay, while
compliance with the injunction would deplete the
debtor's assets, the relief sought was designed to
prevent future harm, not to compensate for past
injuries.
Illinois v. Electrical Utilities.
41 B.R. 874 (N.O. 111. 1984)
—Illinois enforcement action under Toxic
Substances Control Act for injunctive relief and
cost recovery was excepted from stay, although
enforcement of judgment obtained would be stayed
if it required expenditure of resources of estate.
In re Laurinbura Oil Co.. Inc.. 49 B.R. 652
(Bankr. M.D.N.C. 1984)
—No automatic stay aipplicable to prevent North
Carolina from commencing a civil injunctive
action and enforcing a judgment obtained to abate
violations of State water pollution laws at a
waste disposal site and to abate the public
nuisance at the site.
In re Wheelina-Pittsburah Steel Corp..
Bankruptcy No. 85-793 PGH, Adversary No.
85-0236, Order (Bankr. W.D. Pa. Oct. 31, 1985)
—RCRA action for injunctive relief and civil
penalties not stayed; enforcement of any penalty
judgment stayed.
United States v. F.E. Greaorv & Sons. Inc..
58 B.R. 590 (W.D. Pa. 1986)
—Action by U.S. for coal mine reclamation by
Chapter 11 debtor which had leased and operated
coal mines was excepted from automatic stay.
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12. In re Williston Oil Corp..
54 B.R. 10 (Bankr. D.N.J. 1984)
—Ohio's state court action for injunctive relief
and civil penalties relating to operation of oil
wells was not stayed; enforcement of injunction
would be allowed but not enforcement of money
judgment.
13. In re Lenz Oil Service. Inc..
65 B.R. 292 (Bankr. N.D. 111. 1986)
—Environmental action for injunctive relief and
civil penalties not stayed.
14. United States v. Energy International. Inc..
19 B.R. 1020 (S.D. Ohio 1981)
—Action for penalties for violations of Surface
Mining Control and Reclamation Act was not stayed.
15. In re Security Gas & Oil. Inc.. 70 B.R. 786
(Bankr. N.D. Cal. 1987)
—West Virginia was entitled to bring action to
seek reclamation of abandoned oil wells and to
enforce injunctive reliief obtained. State could
also seek termination of debtor's current
operations. It was not entitled, however to
forfeiture of debtor's performance bond since such
forfeiture violated the automatic stay.
16. United States v. standard Metals Corp.. 49 B.R.
623 (D. Colo. 1985)
—automatic stay did not apply to an action for
stipulated penalties under Clean Water Act
settlement; while entry of a money judgment would
be allowed, enforcement of such judgment would
have to take place in the bankruptcy proceedings.
17. In re Norwesco Development Corp.. 68 B.R. 123
(Bankr. W.D. Pa. 1986)
—Pennsylvania was not stayed from enforcing order
to Chapter 11 debtor to require submission of plan
for replacement of contaminated water supply and
to prohibit creation of new problems. Court does
not decide whether enforcement of order to provide
new permanent supply would be stayed.
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18. In re Chateauaav Corp.. 118 B.R. 19
(Bankr. S.D.N.Y. 1990)
—automatic stay did apply to Clean Water Act
citizen's suit; police or regulatory exception did
not apply.
19. United States v. Automation Components. Inc.. No.
90-1279 (D.N;J. Nov. 26, 1990)
—exception to automatic stay applied to action
for civil penalties and punitive damages under
CERCLA §9 106(b) and 107(c)(3).
20. United States v. Suaarhouse Realty. Inc.. 162 B.R.
113 (E.D. Pa. 1993)
—exception to automatic stay applied to action
for stipulated penalties for violations of cleanup
requirements of a CERCLA/TSCA Consent Decree.
21. In re Madison Industries. Inc.. 161 B.R. 363
(D.N.J. 1993)
—State of New Jersey's RCRA action for injunctive
relief and penalties with respect to illegal
fertilizer pile was not subject to automatic stay.
22. In re Goodwin. 163 B.R. 825 (Bankr. D. Idaho 1993)
—State of Idaho was stayed by section 362(a)(6)
and enjoined by section 524(a)(2) from seeking to
collect on a pre-petition claim to cleanup
contamination on property in which the debtor no
longer had an interest where the State had sought
in the alternative to recover damages equal to the
amount of the cleanup.
23. In re Neman. No. 93-3 (EPA Env. App. Bd. Aug. 26,
1994)
—administrative action to fix amount of penalties
for violations of Toxic Substances Control Act
falls within the police and regulatory exception
of automatic stay.
24. United States v. Merritt. No. 94CV026 (D. Wyo.
Mar. 10, 1994)
—Action for injunction under Safe Drinking Water
Act to protect health and safety of residents of
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mobile homes fell within police and regulatory
exception of automatic stay.
Regulatory Actions
1. In re Commonwealth Oil Refining Co.. 805
F.2d 1175 (5th Cir. 1986), cert, denied.
483 U.S. 1005 (1987)
—Automatic stay does not prevent EPA from
enforcing RCRA interim status requirements;police
and regulatory exception is not limited to
situations of imminent and identifiable harm;
administrative action to require compliance with
RCRA was not one for a money judgment even though
expenditure of funds would be required to comply.
2. In re Metcoa. No. B83-00415 (Bankr. N.D. Ohio
Nov. 18, 1986)
—Automatic stay did not prevent Nuclear
Regulatory Commission from modifying source
material license.
3. In re Beker Industries Corp.. 57 B.R. 611 (Bankr.
S.D.N.Y. 1986)
—Proceedings relating to County and State
regulation of debtor's mine were not covered by
automatic stay. Section 362(b)(4) exception
applied. Section 362(a)(3) stay of actions "to
exercise control over property of the estate" was
inapplicable.
4. Cournover v. Town of Lincoln. 790 F.2d 971
(1st Cir. 1986)
--automatic stay did not prevent town from
enforcing its zoning ordinance by removing and
disposing of scrap metal on debtor's property.
Cost Recovery/Natural Resource Damage Actions
1. United States v. Nicolet. Inc..
857 F.2d 202 (3d Cir. 1988)
—automatic stay does not apply to CERCLA cost
recovery action by United States.
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2. United States v. ILCO. Inc..
48 B.R. 1016 (N.D. Ala. 1985)
--United States' claim for cost recovery held not
to be subject to automatic stay.
3. United states v. MacKav. No. 85 C6927, slip op.
(N.D. 111. Jan. 17, 1986)
—United States' CERCLA cost recovery action is
not subject to automatic stay.
4. United States v. Mattiace Industries. Inc..
26 Env't Rep. Cas. (BNA) 1484 (E.D.N.Y. May 15,
1987)
—automatic stay does not apply to United States'
CERCLA action for cost recovery, civil penalties
and punitive damages, and injunctive relief.
5. Citv of New York v. Exxon Corp.. 932 F.2d 1020
(2d Cir. 1991)
—Claim for cost recovery by City of New York was
not subject to the automatic stay.
6. United States v. Midwest Solvent Recovery. Inc..
No. H79-556 (N.D. Ind. Feb. 12, 1992)
—United States' CERCLA action for recovery of
costs and for injunctive relief was within the
police or regulatory exception.
7. In re Gershon. Adv. No. 91-7427 (D. Kan. Aug. 24,
1992)
—United States' CERCLA action for recovery of
costs from chapter 7 debtor was not subject to the
automatic stay.
8. In re New York Trap Rock Corp.. 153 B.R. 642
(BanXr. S.D.N.Y. 1993)
—CERCLA cost recovery action by Rankin County
Mississippi Board of Supervisors could proceed to
judgment notwithstanding automatic stay.
9. In re Hemingway Transport. Inc.. 993 F.2d 915 (1st
Cir. 1993), cert, denied. 114 S. Ct. 303 (1993)
—EPA CERCLA enforcement actions may proceed to
judgment notwithstanding automatic stay.
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10. United States v. Automation Components. Inc.. No.
90-1279 (D.N.J. Nov. 26, 1990)
—CERCLA cost recovery action falls within
exception to automatic stay.
11. United States v. Acme Solvents Reclaiming. Inc..
154 B.R. 72 (N.D. 111. 1993)
—CERCLA cost recovery action falls within
exception to automatic stay.
12. United States v. American Trader. No. CV-91-3363
RJK (C.D. cal. Dec. 15, 1993)
—CWA action for response costs, natural resource
damages, and penalties falls within exception to
automatic stay.
13. United States v. Transport Co.. 172 B.R. 834 (E.D.
La; 1994)
—Action for response costs under Oil Pollution
Act falls within exception to automatic stay.
Perfection of Liens
1. In re Microfab. Inc.. 105 B.R. 152 (Bankr. D.
Mass. 1989)
—allowing Massachusetts to perfect its
environmental NsuperlienN against property of the
debtor under exception of Section 362(b)(3) which
allows perfection of liens where such perfection
is effective under applicable law against entities
that acquire interests in such property prior to
the date of such perfection; the police or
regulatory exception of Section 362(b)(4) does not
apply to perfection of liens.
Notice of Claims
1. LTV Corp. v. Gulf States Steel. Inc.. 969 F.2d
1050, 1059 (D.C. Cir. 1992), cert, denied. 113 S.
Ct. 661 (1992)
—Mere requests for payment or informational
notices do not violate automatic stay? coercion or
harassment by creditor must be shown to establish
violation of the automatic stay.
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administrative expense priority
a. Post-petition clean-up costs — decisions granting
priority.
1. In re Wall Tube & Metal Products Co. 831 F.2d
118 (6th Cir. 1987)
— investigatory costs incurred by Tennessee on
property of Chapter 7 debtor were entitled to be
reimbursed as an administrative expense.
2. In re Chateauqav Corp. fLTVl. 944 F.2d 997 (2d
Cir. 1991), aff'g. 112 B.R. 513 (S.D.N.Y. 1990).
—monies spent to comply with environmental laws
post-petition at debtor's sites are administrative
expenses.
3. In re Hemincrwav Transport. Inc.. 993 F.2d 915 (1st
Cir. 1993), cert, denied. 114 S. Ct. 303 (1993)
—past clean-up costs incurred by party that
purchased property from the bankruptcy estate
were entitled to administrative priority; future
clean-up costs were also entitled to
administrative priority but such claims might be
disallowable claims under Section 502(e) if the
claimant and debtor were jointly liable to EPA;
court notes that allowance of administrative
expense does not require proof of discernible
benefit to estate; distribution on claim for
future response costs may be placed in trust.
4. In re Smith-Douglass. Inc.. 856 F.2d 12 (4th Cir.
1988)
—"cleaning up environmental violations is
properly considered an administrative expense."
5. Pennsylvania v. Conrov. 24 F.3d 568 (3d Cir.
1994), aff'g 153 B.R. 686 (W.D. Pa. 1993)
—granting New Jersey administrative expense
priority for cost of complying with administrative
cleanup order issued to individual debtor that
operated a printing company; agency's costs in
cleaning up facility that could not be abandoned
under state laws entitled to administrative
priority; administrative expense priority granted
in part for expenses to be incurred in the near
future; district court notes that estate was
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benefitted by performance of a cleanup that the
estate was otherwise required to perform itself
under applicable law and because the cleanup
reduced the risk of further damage and liability
of the estate; state's administrative and legal
costs are entitled to same priority.
6. In re Stevens. 68 B.R. 774 (D. Me. 1987),
rev'a. 53 B.R. 783 (Bankr. D. Me. 1985)
—Maine was entitled to recover its response costs
as an administrative expense; since the trustee
cannot abandon hazardous waste, cleanup was the
responsibility of the estate.
7. In re T.P. Long Chemical. Inc.. 45 B.R. 278
(Bankr. N.D. Ohio 1985)
—-EPA was entitled to recover its expenses in
removing hazardous material from property of a
Chapter 7 estate as an administrative expense
since the estate was liable under CERCLA; EPA
could not recover on its claim ahead of secured
creditor under Section 506(c) since its cleanup
did not confer a benefit on the secured creditor.
8. In re Mowbrav Engineering Co.. Inc..
67 B.R. 34 (Bankr. M.O. Ala. 1986)
—EPA is entitled to recover under Section 506(c)
its costs of cleaning up contaminated property
prior to satisfying any secured claims against
the property; clean-up costs are an administrative
expense; court follows T.P. Long decision.
9. In re Peerless Plating Co. 70 B.R. 943 (Bankr.
W.D. Mich. 1987)
--EPA's clean-up costs on property of chapter 7
debtor are administrative expenses.
10. In re Laurinburg Oil Co.. Inc.. 49 B.R. 652
(Bankr. M.D.N.C. 1984)
—expenses of debtor to comply with state water
pollution laws were administrative expenses.
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11. In re Vermont Real Estate Inv. Trust. 25 B.R. 804
(Bankr. D. Vt. 1982)
—costs incurred by City of Montpelier in removal
of dangerous building from leased property was
entitled to be paid as an administrative
expense.
12. In re California Creative Dynamics. No. BK 86-
07469-H, Order (S.D. Cal. June 29, 1989)
—'^EPA's expenditures incurred at the debtor's
facility were actual and necessary costs of
preserving the debtor's estate."
13. In re Distriqas Corp.. 66 B.R. 382 (Bankr. D.
Mass. 1986)
—New Jersey's clean-up costs on property of
Chapter 11 debtor were, at the very least,
administrative expenses.
14. In re FCX. Inc.. No. S-85-1574-5 (Bankr.
E.D.N.C. Dec. 30, 1988)
—allowing administrative expense claims for EPA
and State clean-up costs, notwithstanding prior
confirmation of a plan of reorganization not
providing for such claims.
15. In re National Gypsum Co.. 139 B.R. 397 (N.D.
Tex. 1992)
—response costs with respect to site owned by
debtor would be an administrative expense but only
if th« site presented an imminent and identifiable
harm.
16. In re Great Northern Forest Prods. Inc.. 135 B.R.
46 (W.D. Mich. 1991)
—granting administrative expense claim of
landlord relating to leased property.
17. In re Virginia Builders. Inc.. 153 B.R. 729
(Bankr. E.D. Va. 1993)
—granting administrative priority to bank that
cleaned up debtor's contaminated property even if
property was contaminated pre-petition.
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18. In re Allegheny International. Tnr.. 158 B.R. 343
(Bankr. W.D. Pa. 1992)
—granting administrative priority to chapter 11
debtor's costs in complying with pre-petition
consent decree and NRC license requirement with
respect to cleanup of facilities no longer owned
or actively operated by debtor.
Post petition cleanup costs — decisions denying
priority
1. Southern Rv. Co. v. Johnson Bronze Co.. 758 F.2d
137 (3d Cir. 1985), clarified bv Pennsylvania v.
Conroy. 24 F.3d 568 (3d Cir. 1994)
—Section 105 of Bankruptcy Code cannot be used to
provide a private party complying with a state
administrative cleanup order priority over
unsecured claims.
2. In re Pant & Russell. Inc.. 853 F.2d 700 (9th Cir.
1988)
—in case involving private parties, denying
priority for post petition clean-up cost on
property leased by the bankruptcy estate; court
recognizes that a different result would obtain if
the property had been owned by the bankruptcy
estate.
3. In re Security Gas & Oil. Inc;. 70 B.R. 786
(Bankr. N.D. Cal. 1987)
—clean-up obligation arising from an
environmental hazard created pre-petition is a
general unsecured claim.
4. In re Pierce Coal and Const.. Inc.. 65 B.R. 521
(Bankr. N.D. W. Va. 1986)
-Post-petition reclamation expenses resulting
from pre-petition conduct of debtor were not
administrative expenses. Expenses resulting from
post petition conduct were administrative
expenses.
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5. In re Microfab. Inc.. 105 B.R. 161 (Bankr. D.
Mass. 1989)
— denying State's request to require Chapter 7
trustee to cleanup debtor's facility, since there
would be no assurance that to do so, given the
limited funds available, would significantly
improve the conditions at th6 site. Even if such
a showing could be made, the State would first
have to undertake the cleanup itself and then seek
reimbursement.
6. In re Bofors-Nobel. Inc.. No. NG-85-02671, Order
Denying Motion of Thermo Chem Participating
Companies (W.O. Mich. Mar. 7, 1988)
—contribution claims under CERCLA with respect to
sites at which debtor was a generator are not
administrative expenses.
7. In re Corona Plastics. Inc.. 99 B.R. 231 (Bankr.
D.N.J. 1989)
—cleanup costs are general unsecured
claims.
8. In re Kent Holland Die Casting & Plastics. Inc..
125 B.R. 493 (Bankr. W.D. Mich. 1991)
--granting priority for costs of cleaning up
contamination created during pendency of
bankruptcy? denying priority for cleanup of pre-
bankruptcy contamination.
9. In re Circle K Corp.. 141 B.R. 688 (Bankr. D.
Ariz. 1992)
—denying administrative expense priority against
debtor lessee that rejected leases that included
operation of underground storage tanks.
10. In re H.F. Radandt. Inc.. 160 B.R. 323 (Bankr.
W.D. Wis. 1993)
—refusing to grant administrative priority to
future cleanup costs on the ground that that would
constitute an impermissible advisory opinion.
ygs
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11. In re Hanna. 168 B.R. 386 (9th Cir. B.A.p. 1994)
—denying administrative priority for cleanup of
off-site contamination that had migrated from
property of the debtor pre-petition where damages
occurred pre-petition; dissent contends that
liability is post-petition administrative priority
based on post-bankruptcy ownership of the property
and administrative order creating legal obligation
to clean up contamination.
Administrative Expense Priority With Respect to Secured
Creditor—Section 506(c)
1. In re T.P. Long Chemical. Inc.. 45 B.R. 278
(Bankr. N.D. Ohio 1985)
— EPA could not recover on its administrative
claim ahead 6f secured creditor under Section
506(c) since, on facts presented, its cleanup did
not confer a benefit on the secured creditor.
2. In re Howbrav Engineering Co.. Inc.. 67 B.R. 34
(Bankr. M.D. Ala. 1986)
—EPA is entitled to recover under Section 506(c)
its costs of cleaning up contaminated property
prior to satisfying any secured claims against
the property; clean-up costs are an administrative
expense; court follows T.P. Long decision.
3. In re Metcoa. Inc.. No. B85-092 (Bankr. N.D. Ohio
Nov. 18, 1986)
—Nuclear Regulatory Commission's claim to require
compliance with license was not superior to
interests of secured creditor.
4. In re Better Brite Plating. Inc.. 105 B.R. 912
(Bankr. E.O. Wis. 1989)
-- Giving EPA and Wisconsin DNR priority over
secured creditors in proceeds of sale of any
property subject.
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5. In re Better Brite Plating. Inc.. Case No. 89-C-
1132 (E.D. Wis. Apr. 4, 1990), vacated as moot.
136 B.R. 526 (E.D. Wis. 1990)
—denying Wisconsin's claim that available
bankruptcy assets should be used for cleanup of
drums of hazardous waste using other,
uncontaminated collateral of a secured creditor,
notwithstanding that the drums had been generated
in a period in which the business had been
operated for the benefit of the secured creditor.
6. Resources Unlimited. Inc. v. Environmental Wast*
Control. Inc.. 158 B.R. 998 (N.D. Ind. 1993)
—chapter 11 debtor could expend funds to comply
with cleanup order if there was adequate
protection for secured creditor.
d. Post-petition penalty claims
1. In re Charlesbanfc Laundry. Inc.. 755 F.2d 200 (1st
Cir. 1985), holding reaff'fl in In re Hemingway
Transport. Inc.. 954 F.2d 1 (1st Cir. 1992), and
In re Hemingway Transport. Inc.. 993 F.2d 915 (1st
Cir. 1993), cert, denied. 114 S. Ct. 303 (1993)
—fine incurred by Chapter 11 debtor in committing
a nuisance was an administrative expense.
2. United States Dept. of Interior v. Elliott.
761 F.2d 168 (4th Cir. 1985)
—Department of Interior's claim for penalties for
post-petition violation of Surface Mining Control
and Reclamation Act was an administrative expense.
3. In re Chateaugav Corp. CLTV). 944 F.2d 997 (2d
Cir. 1991)
—"civil penalties for post-petition violations
would also be entitled to be treated as
administrative expenses."
4. In re N.P. Mining Co.. 963 F.2d 1449 (11th Cir.
1992)
—civil penalties for post-petition mining
activities are an administrative expense.
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5. In re Bill's Coal Co.. 124 B.R. 827 (D. Kan.
1991)
—penalties for environmental violations are an
administrative expense.
6. Leavell v. Karnes. 143 B.R. 212 (S.D. 111. 1990)
—fines, penalties or cleanup costs caused by a
trustee's violation of environmental laws during
the operation of a business are administrative
expenses; such costs must be paid before the
bankruptcy estate is closed.
7. In re Motel Investments. Inc.. 172 B.R. 105 (M.D.
Fla. 1994)
—stipulated penalties for post-petitior. failure
of debtor-in-possession to comply with pre-
petition consent order to remediate wetlands were
administrative expenses of estate since government
had taken pre-petition action to correct
environmental violations.
8. In re Wisconsin Barge Lines. Inc.. 91 B.R. 65
(E.D. Mo. 1988)
--fines for pre-petition conduct were
dischargeable claims not entitled to priority.
C. CERCLA C08T RECOVERY/WHEN CERCLA CLAIMS ARISE/
DISCHARGEABILITY/CONTRIBUTION CLAIMS
a. When CERCLA Claims Arise and Become Dischargeable
1. In r« Jensen. 995 F.2d 925 (9th Cir. 1993)
—claim under California Hazardous Substance
Account Act for recovery of costs incurred by the
State arose pre-bankruptcy because the State had
sufficient knowledge of the debtor's potential
liability pre-bankruptcy based on environmental
agencies' inspection of site indicating fungicide
tank that might pose a hazard. Adopts fair
contemplation of the parties test. Court imputed
one agencies' knowledge to other state agency
because they were involved generally in many of
the same capacities.
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2. In re Chicago. Milwaukee. St. Paul & Pacific R.R. .
3 F.3d 200 (7th Cir. 1993)
—holds that a CERCLA claim arises when the CERCLA
claimant can tie the bankruptcy debtor to a known
release of a hazardous substance which the
claimant knows will lead to CERCLA response costs,
and when the claimant has conducted tests with
regard to the contamination problem. Railroad's
claim for contribution was discharged because
railroad had inspected site and observed
contamination and was aware that site was in area
of Superfund site being investigated by EPA.
Court remanded question of whether railroad's
claim under state law had arisen for a comparison
of the particular types of liability in effect at
relevant times under the state statutory scheme.
3. In re Chicago. Milwaukee. St. Paul & Pacific
R.R. . 974 F.2d 775 ;7th Cir. 1992)
—CERCLA claims of Washington State Department of
Transportation were dischargeable where
by the time of the bankruptcy the State could
could connect the debtor to a known release
and State had conducted tests with regard to
the contamination; claims would be discharged
even though debtor had not notified State
because State was not a known creditor to debtor.
4. In re Chateaugav Corp. (LTV1. 944 F.2d 997 (2d
Cir. 1991)
—cost recovery claim can be discharged if it
arises from pre-petition conduct of the debtor and
if there were pre-petition releases or threatened
releases of hazardous substances.
5. In re Penn Central Transportation Co.. 944 F.2d
164 (3d Cir. 1991), cert, denied. 112 S. Ct.
1262 (1992), followed bv Penn Central v. United
States. 862 F. Supp. 437 (Sp. Ct. R.R.R.A. 1994)
—claims of the United States for cleanup of a
contaminated rail yard formerly operated by Penn
Central were not discharged because at time plan
of reorganization was confirmed in 1978 CERCLA had
not yet been enacted? "it was not until the
passage of CERCLA that a legal relationship was
created between the petitioners and [Penn Central]
relevant to the petitioners' potential causes of
action such that an interest could flow."
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6. In re National Gypsum Co.. 139 B.R. 397 (N.D.
Tex. 1992)
—cost recovery claim for future costs would be a
"claim" for bankruptcy purposes if it was within
the fair contemplation of the parties at the time
of the bankruptcy.
7. In re Allegheny International. Inc.. 126 B.R. 919
(W.D. Pa. 1991), aff'd. 950 F.2d 721 (3d Cir.
1992) .
—CERCLA cost recovery claim does not arise until
incurrence of costs, but once some costs are
incurred a claim exists for all costs to be
incurred at the site.
8. United States v. Union Scrap Iron & Metal. 123
B.R. 831 (D. Minn. 1990)
—claims under Section 107 of CERCLA for recovery
of costs incurred post-bankruptcy had not been
discharged.
9. Sylvester Brothers Development Company v.
Burlington Northern R.R.. 133 B.R. 648
(D. Minn. 1991)
—Minnesota's cost recovery claim and private
party claims for contribution under CERCLA
are not discharged if debtor did not provide
notice and Minnesota did not have actual knowledge
of potential claim.
10. NCL Corp. v. Lone Star Building Centers fEastern)
Inc.. 144 B.R. 170 (S.D. Fla. 1992)
—Applying fair contemplation test to private
party CERCLA claim for contribution and finding
that contractual relationship put claims within
fair contemplation of the parties and made them
dischargeable.
11. AM International. Inc. v. Datacard Corp.. 146 B.R.
391 (N.D. 111. 1992)
--denying motion for summary judgment against
private party's CERCLA claim because whether the
CERCLA claim was within the fair contemplation of
the parties presented a genuine issue of material
fact.
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12. Mesiti v. Microdot. Inc.. 156 B.R. 113 (D.N.H.
1993)
—advocating "foreseeability" test in determining
whether CERCLA claims had arisen and were
discharged; remanding case to railroad court that
had reserved exclusive jurisdiction.
13. Erman v. Lox Equipment Co... 142 B.R. 905
(N.D. Cal. 1992)
—Private party CERCLA claim against debtor
relating to property purchased from the debtor
during bankruptcy arose post-petition at time of
transfer, not at time of pre-petition
contamination.
14. Waterville Industries Inc. v. First Hartford
Corp.. 32 E.R.C. 1925, 1927 n.2 (D. Maine Jan.
28, 1991)
—CERCLA contribution claim does not arise until
costs are incurred.
15. In re Todd Shipyards Corp.. No. 87-5005 (Bankr.
D.N.J. Aug. 8, 1989)
—CERCLA claims for contribution do not exist for
bankruptcy purposes until there is a finding of
the original defendants' liability. Accordingly,
those claims could not be discharged,
16. Providence and Worcester R.R. Co. v. Penn
Central Corp.. 30 Env't Rep. Cas. (BNA) 1309
(D. Mass. 1989).
—CERCLA and State lav contribution claims against
Penn Central had been discharged since they arose
prior to date of plan consummation order in 1978.
CERCLA Claims Based On Post-Bankruptcy Ownership or
Or Operation
;. In re CMC Heartland Partners. 966 F.2d 1143 (7th
Cir. 1992)
—where a reorganized company continues to own
contaminated property post-bankruptcy, CERCLA
claims under Section 107(a)(2) based on the
company's pre-petition operation of a site would
be discharged, but relief may still be sought
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under Section 106 and 107(a)(l) in the case of
ongoing post-bankruptcy releases or threats of
releases since claim arises anew based on post-
bankruptcy ownership.
2. Penn Central v. United States. 862 F. Supp. 437
(Sp. Ct. R.R.R.A. 1994)
—statute allowing the sale of property "free and
clear of any liens and encumbrances" does not mean
that properties are conveyed free and clear of
statutory CERCLA claims; also finding no successor
liability where deeds expressly provided that
successor wold have no liability for pre-
conveyance contamination, United States did not
object as a party to the case to such language in
deeds, and United States did not pursue such
liability since successor already faced liability
based on its post-conveyance activities.
c. Disallowance of Contingent Claims
For Contribution Under Section 502(e)
1. In re Allegheny International. Inc., 126 B.R. 919
(W.D. Pa. 1991), aff'd. 950 F.2d 721,(3d Cir.
1992)
--refusing to disallow claims for contribution
under Section 502(e) and providing that
distribution on claim be placed in trust for
payment of future environmental liability.
2. In re Hemingway Transport. Inc.. 993 F.2d 915 (1st
Cir. 1993), cert, denied. 114 S. Ct. 303 (1993)
—refusing to disallow claim for contribution for
future response costs under Section 502(e) unless
both (1) trustee files surrogate proof of claim on
behalf of EPA and (2) PRP is found to be co-liable
with debtor to EPA because PRP is found not to
have available alleged innocent landowner defense
under CERCLA; requires setting of bar date for
filing of claim on behalf of EPA by trustee or
creditor PRP; claim would be disallowed under
Section 502(e) only until such time as response
costs were incurred.
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3. In re Charter Co.. 862 F.2d 1500 (11th Cir. 1989)
—disallowing CERCLA contribution claims pursuant
to Section 502(e)(1)(B) of the Bankruptcy Code,
as contingent claims.
4. In re Pant & Russell. Inc.. 951 F.2d 246 (9th Cir.
1991)
—Section 502(e)(1) of the Bankruptcy Code did nc:
bar a private cost recovery claim under Section
107(a)(4) of CERCLA where EPA did not order a
cleanup at the site in question.
5. In re Harvard Industries. Inc.. 153 B.R. 668
(Bankr. D. Del. 1993) and 138 B.R. 10 (Bankr. D.
Del. 1992)
—Section 502(e)(1) does not bar claims of PRPs
for future out of pocket costs because these are
direct contingent claims that do not pose a risk
of multiple payments by the debtor to EPA and the
PRPs; claims for PRPs' liability to EPA are
barred; monies for future cleanups can be placed
in trust.
6. In re Eaale-Picher Industries. Inc.. 164 B.R. 265
(S.D. Ohio 1992)
—disallowing claims for CERCLA contribution under
Section 502(e)(1)(B) except for cleanup costs
already incurred; claims towards future
obligations under Consent Decree disallowed;
request for establishment of trust denied.
7. In re Todd Shipyards Corp.. No. 87-5005 (Bankr.
D.N.J. Aug. 8, 1989)
—CERCLA contribution claims can be disallowed but
under Section 502(e).
8. In re Cottonwood Canvon Land Co.. 146 B.R. 992
(Bankr. D. Colo. 1992), supplemented. No. 87-B-
1552-E (Bankr. D. Colo. July 2, 1993)
—disallowing PRP's claims for contribution under
Section 502(e)(1)(B) even though EPA had not filed
direct claim of its own in bankruptcy proceeding
and even if costs were already incurred.
^^5
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9. In re Bicoastal Corp.. 141 B.R. 231 (Bankr. M.D.
Fla. 1992)
—disallowing claim of creditor under Section
502(e)(1)(B) that previously had purchased
contaminated property from debtor.
The following cases support the argument that claims by PRPs
against other PRPs under Section 107 of CERCLA are claims for
contribution under Section 113 of CERCLA that can be barred by
contribution protection under Section 113(f)(2), 42 U.S.C. §
9613(f)(2).
Akzo coatings. Inc. v. Aianer Corp.. 30 F.3d 761 (7th Cir. 1994)
Dravo Corp. v. Zuber. 24 Chem. Waste Lit. Rep. 1324 (D. Neb.
Sept. 9, 1992), aff'd. 13 F.3d 1222 (8th
Cir. 1994)
Avnet. Inc. v. Allied Signal. Inc.. 825 F. Supp. 1132 (D.R.I.
1992)
United States v. New Castle County. No. 80-489 (D. Del. Sept. 21,
1992)
Transtech v. A & Z Septic. 798 F. Supp. 1079 (D.N.J. 1992)
United States v. Asarco. Inc.. 814 F. Supp. 951 (D. Colo. 1993)
SM& £££ Burlington Northern R.R. Co. v. Time Oil Co.. 738 F.
Supp. 1339 (W.D. Wash. 1990).
See also In re Hemingway Transport. Inc.. 993 F.2d 915 (1st Cir.
1993) (describing section 107 as the pre-enforcem$nt analog to a
contribution action under section 113(f) where the plaintiff is
potentially liable to EPA as a joint tortfeasor).
c. Ripeness
1. In re Combustion Eguipment Associates. Inc.. 838
F.2d 35 (2d Cir. 1988)
--Issue of whether a post-bankruptcy CERCLA claim
had been discharged was not ripe prior to
commencement of EPA enforcement action.
2. Manville Corp. v. United States. 139 B.R. 97
(S.D.N.Y. 1992)
—Issue of scope of discharge of post-bankruptcy
CERCLA claims was ripe for declaratory judgment
where EPA had issued special notice letters
threatening enforcement action or posing
possible prejudice to non-settlor's rights.
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3. Penn Central Corp. v. United States. No. 92-1 (Sp.
Ct. R.R.R.A Feb. 3, 1993)
--Issue of scope of railroad reorganization
discharge of CERCLA claims was ripe for
determination where United States had brought suit
against reorganized railroad in district court.
d. Natural Resource Damage Claims
1. In re National Gvosum Co.. 139 B.R. 397 (N.D.
Tex. 1992)
—natural resource damage claim exists for
bankruptcy purposes even though no remedy has been
selected for the site, as long as the claim is
within the fair contemplation of the parties.
D. CERCLA BANKRUPTCY LITIGATION AMD SIGNIFICANT BANKRUPTCY
SETTLEMENTS
a. Estimation and Allowance of CERCLA Claims
1. In re Chateauaav Corp..fLTV^. 944 F.2d 997 (2d
Cir. 1991)
—"nothing prevents the speedy and rough
estimation of CERCLA claims for purposes of
determining EPA's voice in the Chapter 11
proceeding, with ultimate liquidation of the
claims to await the outcome of normal CERCLA
enforcement proceedings in which EPA will be
entitled to collect its allowable share (full or
pro rata depending on the reorganization plan) of
incurred response costs."
2. In re National Gypsum Co.. 139 B.R. 397 (N.D.
Tex. 1992)
—following LTV and suggesting that estimation
should not be for purposes of allowance.
3. In re National Gypsum Co.. Civ. No. 3-91-1653-H
(N.D. Tex. Nov. 11, 1991)
—directing that an estimation phase with respect
to the magnitude of the CERCLA cost recovery and
natural resource damage claims should precede the
liability phase.
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4. In re CF&I Fabricators of Utah. Inc.. No. 90B-
06721 (Bankr. D. Utah May 11, 19-92)
—arbitrary and capricious standard of review
applies to EPA ROD cost estimates; some deference
to be given to EPA's costs estimates at sites
for which there is not yet a ROD
5. In re CF&I Fabricators of Utah. Inc.. No. 9.QB-
06721 (Bankr. D. Utah May li, 1992)
—Bankruptcy Rule 7068 on offers of judgment
cannot be applied against the United States in
an estimation proceeding.
6. In re Allegheny International. Inc.. 158 B.R. 361
(Bankr. W.D. Pa. 1993)
—In private party contribution claim estimation
hearing, court estimates cleanup costs at 13 sites
at $12,792,000, but allocates contribution share
of debtor at zero based on parties' understanding
of environmental liabilities at time of sale of
properties.
Joint and Several Liability
1. In re National Gypsum Co.. 139 B.R. 397 (N.D.
Tex. 1992)
—debtor's CERCLA liabilities would be determined
based on usual theories of joint and several
liability.
2. Penn Central v. United States. 362 F. Supp. 437
(Sp. Ct. R.R.R.A. 1994)
--reorganized railroad's liability under CERCLA
would be determined based on non-bankruptcy law
governing joint and several liability and
divisibility since CERCLA liability arises
notwithstanding any other provisions of law.
Significant Bankruptcy Settlements
i. In re Cuvahoaa Equipment Corporation. 980 F.2d 110
(2d Cir. 1992)
—affirming District Court's approval of CERCLA
settlement as fair, reasonable, and consistent
with CERCLA; provides for deference to EPA's
expertise in entering into the settlement and
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applies abuse of discretion standard in review
district court's approval of settlement. Upholds
court's jurisdiction to enter settlement under
bankruptcy jurisdiction, 28 U.S.C. § 1334(b),
supplemental jurisdiction over ancillary claims,
28 U.S.C. § 1367(a), and CERCLA jurisdiction, 42
U.S.C. § 9613(b). Affirms that court where
bankruptcy was filed is an appropriate
venue for settlement even though Superfund site
and CERCLA litigation was in another district.
2. In re Enercrv Cooperative. Inc.. 173 B.R. 363 (N.D.
111. 1994)
—approving settlement under CERCLA and Indiana
Petroleum Release Statute with trustee for at
least $13.5 million; upholding settlement as based
on a plausible allocation of liability based on
respective years of ownership and operation of
facility; and noting that as long as EPA uses data
on the broad spectrum of plausible approximation
it does not need to amass more precise information
to justify settlement.
3. In re Paris Industries Corp.. 106 B.R. 339 (Bankr.
D. Me. 1989)
—approving settlement dividing proceeds from sale
of contaminated property between New York and
trustee.
4. In re U.E. Systems. Inc.. Mo. 91-32791-HCD (Bankr.
N.D. Ind. Sept. 28, 1992)
—approving and entering multi-site Superfund
settlement providing the United States with an
allowed claim in excess of $27 million, providing
a procedure for handling claims for additional
future sites in the ordinary course of CERCLA
activities but to be paid as general unsecured
claims, and providing that liabilities at sites
that will continue to be owned by debtors will not
be discharged.
5. In re Insilco Corp.. No. SA-92-CA-0210
N.D. Tex. Jan. 19, 1993)
—approving and entering multi-site Superfund
settlement providing the United States with
$5,050,000 in insurance proceeds and an additional
allowed claim in excess of $4.2 million; Court
notes that deference should be given to CERCLA
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agreements if EPA provides a plausible explanation
of the factors justifying the settlement as fair,
reasonable, and consistent with CERCLA and if the
Department of Justice finds the settlement to be
in the public interest after consideration of
public comments; Court also approves procedure for
handling future sites in the ordinary course of
CERCLA activities but to be paid as general
unsecured claims as a fair and reasonable
compromise that avoids the need for unnecessary
estimation hearings.
6. In re Moreco Energy Inc.. No. 91-B-11886 (Bankr.
N.O. 111. Dec. 22, 1992)
—multi-site Superfund settlement requiring debtor
to pay $875,000 towards remediation of four sites
that it will no longer own or operate and
requiring reorganized debtor to remediate site
that it will continue to own and operate.
7. In re National Gypsum Co.. No. 390-37213-SAF-ll
(Bankr. N.D.Tex. Jan. 1993)
—multi-site Superfund settlement requiring debtor
to pay administrative expense claim of $2.0
million and general unsecured claim of $10.0
million for contaminated property owned by the
estate and to be conveyed to a trust and providing
for an additional general unsecured claim of more
than $11 million for certain other specified
sites.
8. In re Chateauqav Corp.. No. 86-B-11270 (S.D.N.Y
Apr. 4, 1993)
—multi-site Superfund settlement providing the
United States with an allowed claim of over $34.7
million, providing a procedure for handling claims
for additional future sites in the ordinary course
of CERCLA activities but to be paid as general
unsecured claims, and providing for a cash payment
of $1.0 million for remediation of a site owned by
a debtor.
9. Tn re Circle K Corp.. No. 90-5052-PHX-GBN (Bankr.
D. Ariz., filed Mar. 29, 1993)
—multi-site RCRA settlement requiring debtor to
pay $30 million into trust funds to provide for
underground storage tank liabilities in at least
31 states.
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10. United States v. Sharon Steel Corp.. No. 86-C-924J
(D. Utah. Nov. 13, 1990)
—Superfund settlement for site owned by debtor
whereby debtor paid United States $22 million for
limited cash out settlement with reopeners
including for new information, exacerbation of
conditions, or removal of hazardous substances
without EPA authorization? debtor also agreed to
certain security and inspection obligations.
11. In re The Charter Co.. Order (M.D. Fla. Nov. 24,
1987)
—dismissing an appeal of bankruptcy court's
approval of settlement of CERCLA claims of the
United States. Since the objecting party had
failed to obtain a stay during the appeal, and
money had been paid out under the settlement, the
appeal was moot.
12. In re Bofors-Nobel. Inc.. No. 85-02671 (W.D. Mich.
Mar. 7, 1988)
—refusing to vacate an approval of a settlement
between the debtor, EPA and the State of Michigan
under which a substantial portion of the estate
assets would be made available for remediation of
a facility owned by the debtor. Settlement was
challenged by PRPs at another Superfund site to
which Bofors had shipped waste, who sought to have
some of the settlement proceeds applied to their
contribution claim.
d. Late Proofs of Claims
1. In re Hudson Oil Co.. 100 B.R. 72 (Bankr. D. Kan.
1989)
—allowing late filing of proof of claim where
party did not know it would need to seek
indemnification for environmental response costs
prior to bar date notwithstanding that party
waited two years to seek to file late claim.
2. In re New York Trap Rock Corp.. 153 B.R. 642 and
648 (Bankr. S.D.N.Y. 1993)
—lack of knowledge that response costs might be
incurred at a site constitutes excusable neglect
justifying filing of proof of claim by Rankin
County Board of Supervisors after bar date; but
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delay of nine months from time of knowledge of
hazardous condition was inexcusable neglect.
E. OBLIGATIONS OF DEBTOR IN POSSESSION OR TRUSTEE TO COMPLY
WITH ENVIRONMENTAL LAWS — APPLICATION OF 28 U.S.C. § 959(b)
1. Ohio v. Kovacs. 469 U.S. 274 (1985)
—Court states that it does not question "that anyone
in possession of the [hazardous waste]
site...[including] the bankruptcy trustee must comply
with the environmental laws of the state of Ohio.
Plainly that person or firm may not maintain a
nuisance, pollute the waters of the State or refuse to
remove the source of such conditions."
2. Midlantic National Bank v. New Jersey Dept. of
Environmental Protection. 474 U.S. 494 (1986)
—28 U.S.C. 9 959(b) supports conclusion that "Congress
did not intend for the Bankruptcy Code to preempt all
state laws that otherwise constrain the exercise of a
trustee's powers."
3. In re Torwico Electronics. Inc.. 8 F.3d 146 (3d Cir.
1993), cert, denied. 114 S. Ct. 1576 (1994)
—Debtor must comply with State of New Jersey's ECRA
cleanup order even though debtor no longer owned or
operated contaminated real property; environmental
obligations of former operator that still owned
hazardous waste run with the hazardous waste.
4. In re N.P. Mining Co.. 963 F.2d 1449 (11th Cir.
1992)
-"•chapter 11 trustee conducting mining operations
must comply with applicable Alabama mining laws.
5. In re Wall Tube & Metal Products Co.. 831 F.2d 118
(6th Cir. 1987)
—28 U.S.C S 959, which requires a trustee to comply
with State law, applies to Chapter 7 liquidating
trustees.
S-0Q
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6. In re Allegheny International. Inc.. 158 B.R. 343
(Bankr. W.D. Pa. 1992)
—Chapter 11 debtor was required to comply with NRC's
conditioning of prior termination of license on cleanup
of facilities that debtor no longer owned or actively
operated; pre-petition consent decree must be complied
with.
7. In re Motel Investments. Inc.. 172 B.R. 105 (Bankr.
M.D. Fla. 1994)
—Chapter 11 debtor was operating in violation of state
law contrary to 28 U.S.C. § 959 by not complying with
pre-petition consent order to remediate wetlands
violations with respect to property not owned by the
debtor.
8. In re Commercial Oil Service. Inc.. 58 B.R. 311 (Bankr.
N.D. Ohio 1986), aff'd. 88 B.R. 126 (N.D. Ohio 1987)
—Trustee would be obligated to clean up hazardous
waste site if bankruptcy proceeded.
9. In re Stevens. 68 B.R. 774 (D. Me. 1987)
—28 U.S.C. § 959(b) applies to liquidating trustees.
10. In re Laurinbura Oil Co.. Inc.. 49 B.R. 652 (Bankr.
M.D.N.C. 1984)
--provisions of 28 U.S.C. § 959(b) require a debtor in
possession to manage and operate property in accordance
with state environmental laws.
11. United States v. Wheelina-Pittsburah Steel
Corp.. 818 F.2d 1077 (3d Cir. 1987)
-Wheeling-Pittsburgh's Chapter 11 status was not an
appropriate basis for the district court to relieve
debtor of obligations to comply with Clean Air Act
requirements.
12. In re Beker Industries Corp.. 57 B.R. 611 (Bankr.
•S.D.N.Y. 1986)
—Chapter 11 debtor in possession was required to
comply with laws regulating mine usage. The
reorganization process "is not designed to
displace valid state and local statutes that
do not conflict with the Bankruptcy Code".
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13. In re Klsh. 41 B.R. 620 (Bankr. E.D. Mich. 1984)
—Allowing a citizens suit under a state environmental
statute against a Chapter 11 debtor in possession
finding that 28 U.S.C. § 959(a) authorized suit.
14. In re Environmental Waste Control. Inc.. 125 B.R.
546 (N.D. Ind. 1991)
—"applicable legal authority suggests that [debtor]
EWC must comply with environmental law and pursue
cleanup and corrective action at the landfill,
regardless of its financial insolvency."
15. Wilner Wood Products v. Maine. 128 B.R. 1 (D. Me. 1991)
—debtor-in-possession must comply with air pollution
laws and obtain permit if it wishes to continue to
operate.
16. In re Rancourt. 144 B.R. 601 (Bankr. D.N.H. 1991)
—authorizing chapter 11 trustee to spend estate
funds to stabilize imminent threats to public health
but temporarily denying authority to spend additional
funds to the extent a further imminent danger had not
been established.
17. In re Vallev Steel Products Co.. 157 B.R. 442 (E.D. Mo.
1993)
—debtor does not have to clean up contaminated
property that it sold prior to filing for bankruptcy;
28 U.S.C. S 959 does not apply to liquidating debtors.
18. In re Grace Coal Co.. 155 B.R. 5 (Bankr. E.D. Ky. 1993)
—Kentucky could order chapter 11 debtor to cease
mining activities without a permit.
F. INJUNCTIVE OBLIGATIONS/DISCHARGEABILITY
1. Ohio v. Kovacs. 469 U.S. 274 (1985)
—injunctive clean-up obligation of former waste site
owner had been converted to a monetary claim and was
discharged, where a receiver has been appointed to take
control of waste site.
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- 48 -
2. In re CMC Heartland Partners. 966 F.2d 1143 (7th
Cir. 1992)
—where a reorganized company continues to own
contaminated property post-bankruptcy, CERCLA
claims under Section 107(a)(2) based on the
company's pre-petition operation of a site would
be discharged, but relief may still be sought
under Section 106 and 107(a)(1) in the case of
ongoing post-bankruptcy releases or threats of
releases since CERCLA "creates a claim running
with the land."
3. In re Torwico Electronics. Inc.. 8 F.3d 146 (3d Cir.
1993), cert, denied. 114 S. Ct. 1576 (1994)
—State of New Jersey could enforce ECRA cleanup order
against debtor that no longer owned or operated
contaminated real propierty; injunctive obligation to
remedy pollution is not a claim where there is an
ongoing and continuing threat and cleanup is not a
repackaged claim for damages; injunctive obligations
against former operator that still owned hazardous
waste left behind survive based on continuing
ownership of hazardous waste.
4. United States v. Whizco. Inc.. 841 F.2d 147
(6th Cir. 1988)
—coal mine reclamation obligation of an individual who
was,a former mine operator had been discharged by
bankruptcy, since reclamation could only be
accomplished through expenditure of funds; however, if
in the future the former operator obtains reclamation
equipment, reclamation can be required.
5. In re Chateauaav Corp. f LTV). 944 F.2d 997 (2d
Cir. 1991)
— "a cleanup order that accomplishes the dual
objectives of removing accumulated wastes and stopping
or ameliorating ongoing pollution emanating from such
wastes is not a dischargeable claim."
6. United States v. Hubler. 117 B.R. 160 (W.D. Pa. June 8,
1990), aff'd without opinion. 928 F.2d 1131 (3d Cir.
1991)
—obligation to comply with administrative order
requiring coal mine restoration was not a "claim" and
therefore was not discharged; court disagrees with
Whizco. _S2>.
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- 49 -
7. Penn Central v. United States. 862 F. Supp. 437 (Sp.
Ct. R.R.R.A. 1994)
—Railroad Reorganization Act does not shield polluter
from answering for pollution for which it is
responsible on property that it has conveyed to others.
8. In re Robinson. 46 B.R. 136 (Bankr. M.D. Fla.
1985), rev'd on other grounds. 55 B.R. 355 (M.D. Fla.
1985)
—Bankruptcy court held that obligation to restore
marsh lands pursuant to CWA and Rivers and Harbors Act
had been discharged since restoration required
expenditure of money. District Court reversed because
debtor failed to file a brief.
9. In re Goodwin. 163 B.R. 825 (Bankr. D. Idaho 1993)
--State of Idaho could not seek an injunction to
require cleanup of contamination on property in which
the discharged debtor no longer had an interest where
the State had sought in the alternative to recover
damages equal to the amount of the cleanup.
ABANDONMENT
1. Midlantic National Bank v. New Jersey
Department of Environmental Protection.
474 U.S. 494 (1986) (5-4 decision)
—provision in Section 554 allowing a trustee to
abandon burdensome property did not allow for
abandonment of contaminated property in contravention
of state statute reasonably designed to protect the
public health or safety from identified hazards. Court
noted, however, that "abandonment power is not to be
filtered by laws or regulations not reasonably
calculated to protect the public health or safety from
imminent and identifiable harm."
2. Pennsylvania v. Conrov. 24 F.3d 568 (3d Cir. 1994)
—Section 554 does not allow a debtor to violate a
state law promoting public health or safety that
prohibits the abandonment of property containing
hazardous substances; Pennsylvania law defines
abandonment as a "release" of hazardous substances.
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- 50
3. In re Smith-Douglass. Inc.. 856 F.2d 12 (4th Cir.
1988)
--allowing abandonment of contaminated property/ since
bankruptcy court determination that there was no threat
of immediate harm was not clearly erroneous? financial
condition of debtor is relevant to issue, and "where
the debtor has unencumbered assets, the bankruptcy
court should require stricter compliance with state
environmental law before abandonment is permitted."
4. In re L.F. Jennings Oil Co.. 4 F.3d 887 (10th Cir.
1993)
—allowing abandonment where property did not represent
an immediate and identifiable harm to public health or
safety because it was not on state's list of
contaminated sites, there was no data to support a
present threat, and there was no violation of state law
other than failing to file reports.
5. In re Franklin Signal Corp.. 65 B.R. 268 (Bankr. D.
Minn. 1986)
—allowing abandonment after trustee took certain
preliminary steps to deal with waste drums; court sets
forth five part test as to when abandonment should be
permitted.
6. In re Oklahoma Refining Co..
63 B.R. 562 (Bankr. W.O. Okla. 1986)
—allowing abandonment of contaminated property which
did not present "immediate and menacing harm to public
health or safety."
7. In re Peerless Plating Co..
70 B.R. 943 (Bankr. W.D. Mich. 1987)
—a trustee may not abandon a hazardous waste site in
contravention of an environmental law unless the
environmental law is so onerous as to interfere with
the bankruptcy adjudication itself, the law is not
reasonably designed to protect against identified
hazards, or the violation caused by abandonment would
be speculative or indeterminate; court disagrees with
Franklin Signal.
3*5
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- 51 -
8. In re FCX. Inc., 96 B.R. 49 (Bankr. E.D.N.C. 1989)
—allowing abandonment of contaminated property on the
condition that the debtor set aside $250,000 for the
payment of EPA and State clean-up costs; court holds
that the "crucial determination is whether there is an
immediate danger to the public health."
9. In re 82 Milbar Boulevard. Inc.. 91 B.R. 213 (Bankr.
E.D.N.Y. 1988)
—refusing to allow abandonment of contaminated
property; directing instead the conveyance of the
estate's possessory interest in the property to EPA
conditioned on EPA's acceptance of such interest [which
EPA thereafter did not accept] and an agreement between
EPA and the Trustee on the conditions under which title
would again vest in the debtor.
10. In re Shore Co.. 134 B.R. 572 (Bankr. E.D. Tex< 1991)
—allowing abandonment of contaminated oil refinery,
because the Texas Water Commission and EPA had not
shown that the facility presented an imminent and
identifiable harm.
11. In re Better Brite Plating. Inc.. 105 B.R. 912 (Bankr.
E.D. Wis. 1989)
—allowing abandonment where estate had no unencumbered
assets and there was no imminent harm or danger to
the public.
12. In re Anthony Ferrante & Sons. Inc.. 119 B.R. 45
(D.N.J. 1990)
--allowing abandonment where trustee had no
unencumbered assets and where state had not enforced
administrative orders for eight years indicating
th« absence of the creation of imminent and
identifiable harm to the public from abandonment,
public.
13. New Jersey Department of Environmental Protection v.
North American Products Acquisition Corp.. 137 B.R. 8
(D.N.J. 1992)
—remanding for a hearing on whether abandonment
would create a peril or aggravate the danger to
the public.
5
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- 52 -
14. Leavell v. Karnes. 143 B.R. 212 (S.D. 111. 1990)
—Bankruptcy Court erred in allowing abandonment
without making a finding as to whether conditions .on
the property pose an immediate and identifiable threat
to public health or safety.
15. In re Indian Well Estates. Inc.. No. LA-91-62263-VZ
(Bankr. C.D. Cal. Oct. 22, 1992)
—Trustee could not abandon property until he contains
and removes friable asbestos, but Trustee could
thereafter abandon property even though it contained
contaminated groundwater because such abandonment will
not worsen or aggravate the contamination or create an
imminent and significant harm to environment such as by
affecting drinking water wells.
16. In re H.F. Radandt. Inc.. 160 B.R. 323 (Bankr. W.D.
Wis. 1993)
—Trustee could abandon property where there was no
emergency with respect to site conditions.
17. In re MCI. Inc.. 151 B.R. 103 (E.D. Mich. 1992)
—Trustee could abandon property where there was no
imminent threat of harm to the public and the estate
had no unencumbered assets.
18. In re ILCO. Inc.. No. 92-C-2673-S (N.D. Ala. July 29,
1994)
--Refusing to allow abandonment of property where there
was imminent and identifiable harm; absent funds in the
estate, the court could not fashion a permissible
abandonment with the required condition of providing
for the health, safety and welfare of the public.
19. In re Southern International Co.. 165 B.R. 815 (Bankr.
E.D. Va. 1994)
—Upholding abandonment at section 341 meeting where
notice indicated that unspecified property might be
abandoned at meeting; abandonment was appropriate
because spill from machinery containing toxic chemicals
was only speculative at time of abandonment and was not
opposed at section 341 meeting.
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- 53 -
20. In re Sheffield Oil Co.. 162 B.R. 339 (Bankr. M.D. Ala.
1993)
—Trustee was not required inspect underground storage
tanks prior to abandonment where there was no evidence
of any environmental violations or problem.
DISCRETIONARY STAY — 8ECTION 105
1. In re Commonwealth Oil Refining Co.. 805 F.2d
1175 (5th Cir. 1986), cert, denied. 483 U.S. 1005
(1987) .
--Even assuming a Section 105 stay of an action
excepted from the automatic stay is ever available,
such a stay was inappropriate on facts of this case.
To obtain such a stay, debtor would have to show
likelihood of success on underlying enforcement action.
2. In re Security Gas & Oil. Inc.. 70 B.R. 786
(Bankr. N.D. Cal. 1987)
—Bankruptcy Court may enjoin under Section 105
enforcement of a state clean-up order where the clean-
up order would interfere unduly with the functioning of
the Bankruptcy Code. Such interference may result from
distortions of the Code's priority scheme by satisfying
the clean-up claim in full or by reducing likelihood of
reorganization. Court sets forth 9 factors relating to
issuance of Section 105 stay.
3. In re Professional Sales Corp.. 56 B.R. 753
(N.D. 111. 1985)
—reversing bankruptcy court order under Section 105
enjoining EPA from revoking interim status of Chapter
11 debtor under RCRA; such a stay impermissibly allowed
the debtor to operate its RCRA facility despite non-
compliance with RCRA.
4. In re Metcoa Inc.. Ho. B-85-092 (Bankr. N.D. Ohio
Nov. 18, 1986)
—Refusing to issue discretionary stay of Nuclear
Regulatory Commission's modifications of source
material license.
5. In re Kish. 41 B.R. 620 (Bankr. E.D. Mich. 1984)
—Refusing to stay citizens suit against a Chapter 11
debtor in possession.
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- 54 -
6. In re Environmental Waste Control. Inc.. 125 B.R.
546 (N.D. Ind. 1991)
—refusing to issue Section 105 injunction prohibiting
EPA and the State from requiring compliance with
environmental laws. Court finds that debtor failed to
show likelihood of successful reorganization.
7. wilner Wood Products v. Maine. 128 B.R. 1 (D. Me. 1991)
—Section 105 may not be used to override 28 U.s.c.
959's requirement that debtors-in-possession comply
with applicable state environmental laws.
DISMISSAL OR ABSTENTION
1. In re Commercial Oil Service. Inc.. 58 B.R. 311
(Bankr. N.D. Ohio 1986), aff'd. 88 B.R. 126
(N.D. Ohio 1987)
—bankruptcy court must abstain from deciding issues
raised by pending state environmental action; court
dismisses bankruptcy for cause under Section 707 in the
interests of public health, safety and welfare, because
of delay and expense of adding a bankruptcy case to
pending state and federal environmental actions and
because of inexperience of court and trustee in
cleaning up hazardous wastes.
2. In re. Charles George Land Reclamation Trust.
30 B.R. 918 (Bankr. D. Mass. 1983)
—dismissing Chapter 7 bankruptcy because of
impossibility of any trustee's managing site in
accordance with state lav.
3. In re American Crossarm and Conduit Co.. et al..
No. 87-30575T, Order (Bankr. W.D. Wash. May 4,
1987), aff'd. No. C87-3987 (W.D. Wash. Dec. 10, 1987)
--dismissing Chapter 7 bankruptcy because of inability
to administer estates in light of environmental
problems.
4. }n re Mattiace Industries. Inc.. 76 B.R. 44
(Bankr. E.D.N.Y. 1987)
—dismissing bankruptcy where debtor could not meet its
environmental responsibilities.
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- 55 -
5. In re ILCO. Inc.. No. 92-C-2673-S (N.D. Ala. July 29,
1994)
—affirming dismissal of bankruptcy where no trustee
could be found who was willing to serve due to
contamination on property of the estate.
J. REFERENCE TO BANKRUPTCY COURT WITHDRAWAL OF REFERENCE — 28
U.8.C. S 157(d)
1. In re National Gypsum Co.. Civ. No. 3-91-1653-H
(N.D. Tex. Sept. 13, 1991)
—granting withdrawal of reference over all matters
relating to the CERCLA proof of claim of the United
States, "particularly in view of the many unresolved
issues surrounding the intersection of CERCLA and the
Code1*; the court later referred the case baclc to
the Bankruptcy Court after providing guidance on
these unresolved issues, 139 B.R. 397 (N.D. Tex. 1992).
2. In re Insilco Corp.. No. SA-92-CA-0210 (W.D. Tex. Apr.
6, 1992)
—granting withdrawal of reference on debtor's
objection to United States' CERCLA proof of claim
and noting that mandatory withdrawal has been granted
in all bankruptcy cases involving consideration of
CERCLA where one party has moved for withdrawal.
3. In re Hawaiian Western Steel. Ltd.. No. 93-00527 (D.
Haw. June 30, 1993)
--proceedings involving a substantial and material
consideration of both RCRA and CERCLA and bankruptcy
law require withdrawal of reference from the bankruptcy
court.
4. United States v. ILCO. Inc.. 48 B.R. 1016 (N.D. Ala.
1985)
—granting withdrawal of reference under mandatory
withdrawal provision of 28 U.S.C. $ 157(d) over
enforcement action under CWA, RCRA and CERCLA; court
"first noted that the action was within general order of
reference as "related to a case under title 11"; court
further held that even if mandatory withdrawal were not
required it would grant discretionary withdrawal of
reference.
57a
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- 56 -
5. In re Combustion Equipment Associates. Trie?. r
67 B.R. 709 (S.D.N.Y. 1986)
—granting withdrawal of reference over issue of
whether a post-bankruptcy CERCLA claim was
discharged.
6. In re Johns-Manville Corp.. 63 B.R. 600 (S.D.N.Y. 1986)
—granting withdrawal of reference over issue of
whether post petition CERCLA claim was covered by
automatic stay.
7. In re Pepper Industries. Inc. No. 84-04468 (S.O. Cal.
Nov. 6, 1987)
—granting withdrawal of reference in RCRA enforcement
case.
8. In re Carter Industrials. Inc.. No. 87-4218 (E.D. Mich.
Feb. 9, 1988)
—granting withdrawal of reference on application for
reimbursement of CERCLA response costs as an
administrative expense.
9. American Telephone & Telegraph Co. v. Chateauaav Corp..
88 B.R. 581 (S.D.N.Y. 1988)
—granting withdrawal of reference over adversary
proceeding raising issues as to dischargeability of
CERCLA contribution claims.
10. Citv of New York v. Exxon Corp.. No. 85 Civ. 1939
(S.D.N.Y. Mar. 30, 1990)
—refusing to withdraw reference over a bankruptcy
proceeding pending in California, holding that a
district court in one district cannot withdraw the
reference to a bankruptcy court in another district.
However, the court enjoined the parties from litigating
the issues of CERCLA liability in the California
bankruptcy proceedings, holding that a district court,
not a bankruptcy court, should decide such issues.
11. In re FCX. Inc.. No. 85-1574-5 (E.D.N.C. Dec. 28,
1988)
—denying motion for withdrawal of reference with
respect to debtor's motion to abandon contaminated
property and for other relief, since debtor had
conceded CERCLA liability.
6>/
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- 57 -
12. Superior Tov & Manufacturing Co. v. United States
Environmental Protection Agency. No. 91-C-3476 (N.D.
111. June 18, 1992)
—denying withdrawal of reference on debtor's
objection to and request for estimation of United
States' CERCLA claims because only a straightforward
application of environmental laws would be required
13. In re Revere Copper & Brass Inc.. 172 B.R. 192
(S.D.N.Y. 1994)
—reference would not be withdrawn on issue of when
CERCLA contribution claims arose because this question
only involved issues of fact and application of
bankruptcy law.
14. United States v. Merrltt. No. 94CV026 (D. Wyo. Mar. 10,
1994)
—withdrawing reference of entire bankruptcy case that
was inextricably intertwined with real property that
was subject of Safe Drinking Water Act case pending in
District Court.
15. In re Hatzel & Buehler. Inc. v. Orange & Rockland
Utilities. Inc.. 107 B.R. 34 (D. Del. 1989)
—withdrawing reference of adversary proceeding that
will require substantial and material consideration of
environmental and OSHA regulations; withdrawal under
both mandatory and permissive withdrawal.
K. MALICIOUS AMD WZLL7UL CONDUCT BXCB7TX0N TO DISCHARGEABILITY
1. Phippa v. Kentucky. No. 91-5986 (6th Cir. Dec. 3, 1992)
—debtor's mining reclamation obligations not
discharged where debtor engaged in illegal mining
activities even after issuance of a cease and desist
order.
2. In re Tinkham. 59 B.R. 209 (Bankr. D.N.H. 1986)
—debtor's disposal conduct was not malicious and
willful so as to make damage claim non-dischargeable
under Section 523(a)( 6); civil penalty was excepted
from discharge under Section 523(a)(7).
3. In re Berrv. 84 B.R. 717 (Bankr. W.D. Wash. 1986)
—debtor's abandonment of highly dangerous chemicals in
open and leaking vats was willful and malicious
rendering debt non-dischargeable.
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- 58
4. In re Daniels. 130 B.R. 239 (E.D. Ky. 1991)
--discharged coal mine operator could be required to
reclaim mine because his violations constituted
malicious and willful conduct.
5. Kentucky Natural Resources and Environmental Protection
Cabinet v. Seals. 38 E.R.C. 1519 (.W.D. Va. 1993)
—civil penalties for violations of state surface
mining laws were non-dischargeable under Section
52 3(a)(7) because they were penal rather than
compensatory in nature.
L. PLANS OF REORGANIZATION
1. In re El Ark Industries. Inc.. 122 B.R. 87
(Bankr. W.D. Ark. 1990)
—sustaining EPA objection to plan of reorganization
that proposed to convey possibly contaminated property
to EPA.
M. TRUSTEE LIABILITY
1. Wisconsin v. Better Brite Plating. Inc.. 168 Wis. 2d
363, 483 N.W.2d 574 (Wis. 1992)
—state courts do not have jurisdiction to hold
federal bankruptcy trustees personally liable
for acts within their official capacity and scope
of authority; mere violation of state law does
not ipso facto mean that trustee acted outside
his scope of authority.
2. Leavell v. Karnes. 143 B.R. 212, 219 n.3 (S.D. 111.
1990)
—bankruptcy trustee may not be held personally liable
for environmental fines, penalties, and cleanup costs
for trustee's violation of environmental laws unless
trustee willfully and deliberately violated his
fiduciary duties.
3. In re Sundance Corp.. 149 B.R. 641 (Bankr. E.D Wash.
1993)
—receiver is not liable under environmental laws for
abnormally dangerous activities absent a showing of a
negligent or knowingly wrongful act; receiver's actions
that were authorized by order of a fully informed court
are protected by doctrine ol: derivative judicial
immunity; receiver is not liable for actions that are ^
within the reasonable range of business judgment. 3
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
II. SAMPLING AND ANALYSIS
&EPA
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
Module 11 Objectives
• Discuss the role of sampling and analysis in
RCRA enforcement
• Become familiar with sampling and analysis
methods
• Review evidence, reports, testimony, and
data collection in support of
enforcement actions =—
Notes:
1
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
Objectives of Sampling and Analysis
• Determine whether a waste exhibits
hazardous characteristics
• Quantify concentrations of hazardous
constituents
• Establish "knowing endangerment"
• Determine existance of release
• Determine nature and amount of hazardous
substances or nature and extent of
contamination
• Validate owner/operator testing, and identify
laboratory fraud
Notes:
2
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and A nalysis
Key Technical Activities
• Establishing project objectives
• Sampling
• Analyzing samples
• Interpreting and assessing data
Notes:
3
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
DQO Process
• Serves as planning tool for controlling
decision errors
• Improves
- Planning effectiveness
- Design efficiency
- Defensibility of results/decisions
• Ensures that appropriate type, quality, and
quantity of data are collected
Notes:
4
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
r
Seven Steps of the DQO Process
1. State the problem
2. Identify the decision
3. Identify the inputs to the decision
4. Define study boundaries
5. Develop a decision rule
6. Specify the tolerable limits on decision
errors
7. Optimize the design for obtai
V
data
y
Notes:
5
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
Sampling
• Develop a sampling strategy
• Determine the number of samples needed
and sampling locations required to generate
the necessary data
• Determine whether the use of composite or
grab samples is appropriate
• Determine how data will be used and
evaluated
• Develop a sampling plan based on the DQOs
Notes:
6
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling andAnalysis
Types of Samples
Grab Samples
Composite Samples
Notes:
7
September 1995
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JtCRA FroetLlroiters Enfercentetti Workshop
Sampling andAnaiysis
Sampling Designs
* Judgmental
* Probability sampling
September 1995
-5~S%
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
Essential Elements of
Sampling and Analysis Plans
• Based on available information prior to
initiation of the project and DQOs
• Clearly defined purpose and project goals
• Clearly defined DQOs
• Built-in flexibility
Notes:
9
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and A nalysis
Essentia] Elements of
Sampling and Analysis Plans (Continued)
• Procedures for providing split samples
• Cost-effective analytical plan, appropriate
sample preparation, cleanup, and determinative
procedures
• Effective use of screening techniques
• Clearly defined QC procedures to verify
effectiveness of sampling and analytical
procedures
• Careful documentation of methods and QC
procedures
Notes:
10
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
Selecting Analytical Methods
Identify regulatory driver
Establish DQOs for the project (risk- or
technology-based)
Determine
— Appropriate target analytes from the regulatory
requirements and available information on the particular
application
— Matrices of concern
- Desired accuracy, precision, and reproducibility that can be
achieved
- Required method sensitivity (i.e., detection limit)
Select methods that meet these performance
requirements
Notes:
11
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
Selecting Analytical Methods (Continued)
• Determine whether the application is one of
the following, which requires the use of SW-
846 methods:
- Determination of hazardous waste characteristics
- Determination of free liquid
- Analyses in support of a trial burn
- Analyses in support of a Delisting Petition
- Determination of air emissions from process
equipment
• "Any reliable method" can be used for all
other RCRA applications.
Notes:
12
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
Analytical Factors—Target Analytes
• Target analytes should be appropriate for the
particular application.
• EPA program offices have developed many
general and specialized target analyte lists for
various applications.
Notes:
13
September 1995
S<9J
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
General Target Analyte Lists
• Priority Pollutant List
- Developed by OW to measure contamination in
industrial effluent discharges to streams and
surface waters
- Approximately 131 organic and inorganic
analytes
• Appendix VIII (40 CFR § 261)
- List of hazardous constituents in RCRA-listed
wastes
- Approximately 400 organic and inorganic
analytes
Notes:
14
September 1995
SAg
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
General Target Analyte Lists (Continued)
• Appendix IX (40 CFR § 264)
- RCRA ground water monitoring list based on
readily analyzed constituents from Appendix
VIII, plus some from California and Michigan
lists, used to determine whether hazardous
constituents were leaching from RCRA landfills
- Approximately 250 to 300 organic and inorganic
analytes
• Appendix IXA
- A shortened list of indicator compounds for leaks
from landfills
- Contains about 30 to 40 target analytes, primarily
volatile organics
Notes:
15
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
General Target Analyte Lists (Continued)
Drinking Water Lists
- MCL list consists of about 100 organic and inorganic
compounds for which regulatory limits have been established
- ODWGW maintains a secondary list of compounds that need
to be monitored but have no regulatory limits
Hazardous Constituent List (HCL)
- Comprises approximately ISO organic and inorganic
compounds analyzed by CLP Program under CERCLA
- Considerably less rigorous than Appendix IX, particularly
with regard to organic bases and non-purgeable volatiles
Several lists from OAR for Clean Air Act (e.g., NESHAPS, PICs,
POHCs), most of which pertain to volatile organics
Notes:
16
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
\
Specialized Target Analyte Lists
• HWIR List (to be proposed)
- Compounds with de minimis regulatory limits for
waste exiting from RCRA system in lieu of filing a
Delisting Petition
- De minimis limits in water and soil
- Approximately 250 organic and inorganic
analytes based on Appendix IX
• Skinner List
- RCRA list of target analytes for regulating wastes
from petroleum refining industry
- Approximately 50 to 100 compounds, primarily
PAHs
Notes:
17
September 1995
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RCRA Practitioners Enforcement Workshop
Sampling and Analysis
Analytical Factors—Sensitivity
• Detection limits
- Below regulatory threshold
- Specific to samples being analyzed
Notes:
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Analytical Factors—Bias and Precision
• Bias is the deviation due to matrix effects of the
measured value:
- (x5 - xu) from a known spiked amount
- Calculated from spike recovery
- Most RCRA analytical methods exhibit a negative
bias (i.e., spike recoveries are usually <100%)
- Quantitative screening methods have a positive bias.
• Precision is the agreement among a set of
replicate measurements without assumption of
knowledge of the true value:
- Can be affected by a variety of matrix effects
- Calculated from duplicate samples or matrix spike
duplicates (MSDs).
Notes:
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Analytical Factors—Method Reproducibility
Reproducibility is the demonstration
that a method can be performed by
multiple operators in multiple
laboratories.
Notes:
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SW-846 Defined
• SW-846 comprises test methods for
evaluating solid waste.
• SW-846 functions primarily as a
guidance document setting forth
acceptable, although not required,
methods to be implemented by the user,
as appropriate, in responding to RCRA-
related sampling and analysis
requirements.
Notes:
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Mandatory Applications of
SW-846 Methods
• SW-846 methods must be used in the
following five categories:
- Determination of a hazardous waste characteristic
- Determination of free liquid (Method 9095)
- Analyses associated with submission of Delisting
Petition
- Analyses associated with a hazardous waste
incinerator trial burn
- Determination of air emissions from process
equipment.
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Mandatory Applications
of SW-846 Methods (Continued)
• Authorized States can require use of SW-846
methods for any or all RCRA applications.
• EPA regions do not have authority to require
the use of SW-846 methods for non-
mandatory applications.
• The Third Edition (September 1986), as
amended by Updates I (July 1992), II
(September, 1994), IIA (August 1993), and
IIB (February 1995), methods are required to
be used for mandatory applications.
Notes:
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Quality Control Procedures
• QC procedures should be determined and
incorporated into RCRA Sampling and Analysis
Plans (SAPs) as part of the DQO process prior to
initiation of the project.
• Standard analytical QC procedures include:
- Analysis of appropriate blank samples to demonstrate
absence of sample contamination
- Use of appropriate numbers and types of spiked
samples to verify appropriate analyte recovery
• RCRA QC "guidance" is included in Chapter 1 of
SW-846.
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Quality Control Procedures (Continued)
• Use of duplicates/matrix spike duplicates to
verify appropriate analytical precision
• Use of appropriate surrogates to determine
whether matrix effects may be present
• Use of appropriate calibration procedures
to optimize quantitation of target analytes.
Notes:
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11. SAMPLING AND ANALYSIS
Background Materials
&EPA
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11. SAMPLING AND ANALYSIS
11.1 INTRODUCTION
Sampling and analysis of waste and/or environmental media can play a critical role in
Resource Conservation and Recovery Act (RCRA) enforcement case development. The
fundamental basis of RCRA remains whether or not a waste is hazardous. In large part, this
determination depends on sampling and analysis. In addition, the Land Disposal Restrictions
program has added a whole new importance to assessing constituent concentrations. Depending
on the nature of the enforcement action, U.S. Environmental Protection Agency (EPA) case
development staff may have to evaluate the quality of data generated by others, assess the
adequacy of data for making a case, or collaborate in the collection of data through use of an
effective sampling and analysis program. In each instance, case developers must have a basic
understanding of the legal and technical requirements for RCRA sampling and analysis. The
information in this module should help RCRA enforcement case developers assess sampling data
or support sampling and analysis programs, including assessing sampling activities conducted by
facilities and contractors. In addition, this module provides an overview of the sampling and
analysis process that will help case development staff better understand technical considerations
involved in sampling and analysis.
11.1.1 Purpose of Sampling and Analysis
The purpose of sampling and analysis is to obtain evidence in the form of analytical and
physical data that will identify chemical compounds and constituents and their concentrations in
waste or environmental media. In the context of RCRA enforcement cases, information obtained
from sampling and analysis can be used to:
• Determine whether a waste exhibits hazardous characteristics (e.g., to determine whether
a facility is managing hazardous waste without a permit or to assess compliance with
Land Disposal Restrictions)
• Quantify concentrations of hazardous constituents (e.g., for listed wastes), which is
frequently important in corroborating testimony and other evidence.
• Establish that "knowing endangerment" occurred
• Determine whether hazardous waste has been released into the environment (e.g., to
determine whether corrective action or other response actions are required)
• Determine the nature and extent of contamination
• Determine the nature and amount of hazardous substances (e.g., when determining
whether an imminent and substantial endangerment exists (RCRA § 7003))
• Test a waste when testing performed by the owner or operator is determined to be
unsatisfactory or to prove laboratory fraud.
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11.1.2 Overview of Discussion
The remainder of this module addresses the following basic phases of the sampling and
analysis process: 1) establishing project objectives, 2) sampling, and 3) analyzing samples.
These topics are presented in the order they normally occur to provide a general understanding
of each phase of the process. The discussion of sample analysis addresses the role of SW-846
in conducting analyses. Appendix A specifies when use of SW-846 testing methods is required.
11.2 DATA QUALITY OBJECTIVES—A PLANNING TOOL FOR SAMPLING AND
ANALYSIS PROJECTS
One planning tool available to help
successfully implement a sampling and
analysis project, including evaluating whether
sufficient data exist to assess compliance and
determine the presence of a release and, as
necessary, to bring an enforcement action, is
the data quality objective (DQO) process
developed by EPA's Quality Assurance
Management Staff (QAMS). Variations of the
DQO process and/or other planning tools can
be used successfully; the key is to understand the analytical objectives for the project and to plan
accordingly. The planning processes do not need to be elaborate or time-consuming to be
effective.
DQOs are qualitative and quantitative statements that clarify the study objectives, define
the type, quantity, and quality of required data, and specify the tolerable limits on decision errors.
DQOs are used to define the quality control (QC) requirements for data collection, sampling and
analysis, and data review and evaluation. These QC requirements are included in the quality
assurance (QA) objectives for environmental measurements, and the DQOs are incorporated into
a quality assurance project plan (QAPjP). DQO development is an ongoing process involving
discussions between management and technical staff. This process is a practical means for
specifying and ensuring that the requested information is known to be of the "required" quality.
The type, quantity, and quality of data needed to support development of a case will depend on
the regulation being enforced and on case-specific circumstances (e.g., type, quantity, and quality
of existing data; past violations at facility; and enforcement action planned).
Failure to establish DQOs prior to implementing field and laboratory activities can cause
difficulties for the regulatory agency during case development. For example, if the analytical
methods used were not sensitive enough to demonstrate that a constituent concentration was
above a regulatory threshold, then the data would be useless. On the other hand, if a low-cost
technique will suffice, but a higher cost technique is selected, time and money are wasted.
Quality Assurance
Quality assurance is the overall program
implemented to ensure the reliability and
quality of data. The program includes
policies and general procedures (e.g.,
personnel training, preventative
maintenance).
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A seven-step DQO process has been
developed for uniform and consistent data
generation activities' serves as now the
accepted Agency procedure for establishing
DQOs:
• Step 1—State the Problem
• Step 2—Identify the Decision
• Step 3—Identify Inputs to the Decision
• Step 4—Define the Study Boundaries
• Step 5—Develop a Decision Rule
• Step 6—Specify Limits on Decision Errors
• Step 7—Optimize the Design for Obtaining Data.
Quality Control
Quality control is the consistent, routine
use of procedures designed to assure that
the accuracy and precision of each
measurement are defined. Specific
application of these procedures in the
laboratory includes various activities,
including the use of appropriate reference
standards, spikes, replicates, and blanks.
11.2.1 Step 1: State the Problem
The first step in any decisionmaking
process is to define the problem that resulted
in the study's inception. A planning team,
tasked with developing the project-specific
DQOs, is comprised of personnel representing
all phases of the project and may include EPA
attorneys, RCRA inspectors, managers, and
other case development support staff. The
primary decisionmaker, or leader is identified.
Where applicable, field and laboratory technicians, chemists, statisticians, and modelers are also
recruited for the planning team. The responsibilities of each team member are clearly defined
during this initial planning stage.
Existing information is summarized and the need for additional information determined.
Literature searches can be performed, relevant historical data evaluated, or ongoing studies related
to the current site studied. Available financial and manpower resources are identified and project
milestones and deadlines determined, if sufficient information is present.
11.2.2 Step 2: Identify the Decision
Step 2 is used to define the decision statement that the study must resolve. The decision
statement is a consolidation of the principal study question and alternative actions. The principal
study question identifies the key unknown conditions or unresolved issues that will be used to
reveal the solution to the problem being investigated. Alternative actions that may be taken to
State the Problem
For example, the problem might be to
"determine whether water and sludge in a
surface impoundment at Facility X exhibits
a hazardous characteristic" in support of a
3008(a) order.
1. The DQO process is based on the guidance document issued by QAMS in September 1994. Guidance/or the
Data Quality Objectives Process (EPA QA/G-4) provides general guidance to organizations for developing data
quality criteria and performance specifications for decisionmaking.
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solve the problem based on the outcome or on
the decisions arrived at from the study also
are identified.
11.2.3 Step 3: Identify Inputs to the
Decision
Specific information required to resolve
the decision statement must be identified
during Step 3. The selected data acquisition
approach will lead to the next set of questions
that address the specific types of information
needed to support the decision statement.
Sources of the information are then developed
and can include regulatory guidance, scientific
literature, and historical data or past projects
similar in scope to the current effort.
An action level (e.g., a toxicity characteristic [TC] regulatory threshold), defined as the
threshold value that provides the criterion for choosing between alternative actions, needs to be
established. Only the criterion required to establish the action level needs to be formulated in
this step. Step 5 addresses the quantitative determination of the action level.
Step 3 also involves evaluating existing analytical methods to determine whether the method
will perform as published or whether method modification or method development needs to be
included in the study. Each analyte of interest should have a method detection limit or level of
quantitation assigned, which will be used in Steps 5 and 7 of the DQO process.
11.2.4 Step 4: Define the Study Boundaries
During Step 4, two types of boundaries
must be defined and quantified: spatial and
temporal. Spatial boundaries define the
physical area to be studied and locations at
which to collect samples. Temporal
boundaries describe the time frame that the
study data will represent and the times for
sample collection. To arrive at these boundaries, the characteristics that define the population
are identified, as well as the case demands. The compounds of interest and the matrix that
should be evaluated are selected to determine whether the compounds are present and at what
concentrations.
The spatial boundaries, or the geographic area to be studied, are specified using a physical
feature or border, such as units of measure. If appropriate, the population is segregated further
into more homogenous subsets, or strata, as a means of reducing variability. Constraints to
sample collection are also identified to limit potential difficulties at inopportune times.
Identify the Decision
For example, "if waste in the impoundment
exhibits hazardous characteristics, then the
regulatory agency will take further
enforcement action under RCRA § 3008(a)."
Identify the Inputs
For example, to make the decision,
representative samples must be collected
and analyzed for the hazardous waste
characteristics of toxicity and ignitability in
accordance with 40 CFR §§ 261.21 and
261.23.
Define the Boundaries of the Study
For example, "the study will be limited to
the waste contained in the impoundment at
the time of the sampling inspection."
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11.2.5 Step 5: Develop a Decision Rule
During Step 5, a statement is developed
that combines the parameters of interest and
the action levels with the DQO outputs
already developed. The combination of these
three elements forms the decision rule and
summarizes the attributes that the
decisionmaker wants to study and how the
information will assist in solving the central
problem. The four elements that form the
decision rule are 1) the parameter of interest
that describes a characteristic of the population,
in Step 4, when boundaries were defined, 3) the
used as a criterion to choose alternative actions
the alternative actions, as developed in Step 2.
Develop a Decision Rule
For example, "the results for toxicity will
be compared to the regulatory levels set
forth in Table 1 of 40 CFR Part 261.24.
The results for ignitability will be
compared to the criteria described in 40
CFR Part 261.21."
2) the scale of decisionmaking that was defined
action level, or a measurement threshold value,
through the use of "if/then" statements, and 4)
11.2.6 Step 6: Specify Limits on Decision Errors
If decisionmakers select a statistical
sampling approach, then acceptable or
tolerable limits on decision errors and
performance goals for the data collecting
design are established during Step 6. A
statistical sampling approach may not be
appropriate for certain RCRA enforcement
actions, however. In cases where judgmental
or grab sampling is selected, specifying limits
on decision errors is not applicable. (Section
11.3 of this module discusses the selection of
specific sampling strategies.)
11.2.7 Step 7: Optimize the Design for
Obtaining Data
Step 7 addresses the design of a
resource-effective data collection system to
satisfy the DQOs. This step involves
verifying that the DQO outputs produced in
all preceding steps are internally consistent.
The design options should have been
developed based on the data needed to support
the enforcement action.
Specify the Tolerable Limits
on Decision Errors
The regulated community is concerned
with "proving the negative," or the absence
of any hazardous constituents or character-
istics. The enforcement agency is often
concerned with "proving the positive," or
demonstrating that the waste contains
hazardous constituents or exhibits, a
hazardous waste characteristic at a high
enough level relative to the regulatory
threshold.
Optimize the Design
For example, based on field observations
and judgment of the sampler, four .waste
samples (and associated field QC samples)
could be collected and analyzed.
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11.3 SAMPLING
As discussed previously, the DQO process is one approach that can be used to implement
a sampling and analysis program. The outputs of the DQO process are usually a sampling and
analysis plan (SAP) and a QAPjP. The SAP and QAPjP also can be merged into one plan. The
level of detail for these documents will depend on the complexity and objectives of the sampling
and analysis project. This section describes the key technical activities involved in the
development of the sampling strategy that will become part of the SAP.
11.3.1 Development of a Sampling Strategy
The selection of a sampling strategy for a RCRA enforcement action will be influenced by
the regulatory and scientific objectives, the type and magnitude of the violation suspected,
facility-specific conditions, and the time and resources available. A sampling strategy and
sampling procedures should be developed considering the following factors:
• Past compliance record
• History of the facility and knowledge of the waste generation processes, including
knowledge of any variances, extensions, or exemptions that might apply.
• Regulation being enforced (e.g., land disposal restrictions apply to wastes that are
hazardous at the "point-of-generation" and, thus, the sampling strategy would include
collection of waste samples at the point-of-generation).
• Physical state of the waste or environmental medium.
• Potential hazardous characteristics of the material (i.e., toxicity, ignitability, corrosivity,
or reactivity). To prove that a material has a hazardous characteristic, it must be shown
that a "representative" sample of the material exhibits that characteristic and is a waste.
• Volume of material available to be sampled (e.g., 50 drums, a 10,000-gallon tank).
• Homogeneity of material over time and space (e.g., depositional characteristics, spatial
variations, and particle size distribution). A larger number of samples may need to be
characterized if the waste streams are highly variable.
• Method of waste generation, storage, and/or containment (e.g., logistical problems).
• Sampling conditions (e.g., weather).
• Startup, shutdown, or maintenance operations affecting site and waste accessibility.
• Required analysis, associated volume of waste needed, detection limits, and laboratory
turnaround time required (Section 11.4 discusses analytical requirements in detail).
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• Anticipated site- and sample-specific contingencies, such as choosing alternate sampling
points.
Example: An oil refinery operates a wastewater treatment plant, which includes
an inactive storm water basin considered to be a tank by the facility. The
enforcement agency has determined that the basin is a surface impoundment and
believes hazardous waste may be managed in the unit. The case development
team has decided that samples are needed to determine whether the waste in the
basin contains hazardous waste in support of a 3008(a) order. An unannounced
sampling visit will be conducted.
The case development team has reviewed available information on the unit. The
waste is believed to be water contaminated with petroleum hydrocarbons and
potentially exhibits the characteristics of toxicity (i.e., TC) for benzene and
ignitability. The unit is approximately 100 feet wide by 300 feet long by 25
feet deep with a flat bottom. It has steep sloping walls covered by a liner. The
water in the unit is approximately 2 to 3 feet deep. No exemptions or variances
apply to the waste or unit under investigation.
Sampling Strategy: Based on available information, time, and resources, the
enforcement team will take four grab samples (plus associated QC samples),
each to be collected from a different location within the unit. Samples will be
collected using a pond sampler or dipper (on an extension pole). During
collection of each sample, aliquots to be analyzed for volatile constituents will
be collected prior to samples to be analyzed for non-volatile constituents. Prior
to the sampling trip, the sampling team will develop a safety plan that addresses
access to the waste and the potential respiratory hazardous due the volatile
organic compounds.
11.3.2 Types of Samples
Grab samples are single increments of waste or environmental media collected for the
characterization of the chemical concentrations and/or physical properties of interest at a selected
position in time or space. One advantage of grab sampling is that the results of a number of grab
samples can be used to assess the variability in constituent concentrations.
Composite samples are formed by the physical mixing of individual grab samples and
represent the physical average of the parameter of interest over time and/or space. Compositing
is usually chosen for cost-saving reasons (e.g., fewer samples need to be analyzed then if each,
grab sample was analyzed separately and the results used to calculate an average concentration).
Samples analyzed for volatiles are usually not composited due to the potential loss of volatile
constituents during the mixing process.
11.3.3 Representative Sampling
The definitions at 40 CFR Section 260.10 provide that a representative sample "means a
sample of a universe or whole (e.g., waste pile, lagoon, ground water) which can be expected to
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exhibit the average properties of the universe or whole." All of the definition of the RCRA
characteristics include a requirement that the test portion of the waste be a "representative
sample." A variety of strategies may be employed to ensure representativeness. These strategies
can include either multiple grab samples or one or more composite samples from randomly
chosen spots on a pile and thoroughly compositing them into one sample. It is also possible to
obtain a single grab sample that is representative of a larger universe, such as a sample taken
from a drum containing liquids that captures all the liquid phases present. Whichever strategy
is employed, the sampler must be able to reasonably assert that it meets the Agency's definition
of "representative" in order to prove that the waste is characteristic under RCRA.
11.3.4 Sampling Designs
Once the objectives of the sampling program have been define, an appropriate sampling
design can be selected. There are two basic types of sampling designs may be used:
• Judgmental sampling
• Probability sampling.
Judgmental sampling (sometimes called authoritative or directed sampling) refers to the
subjective selection of sites or population units by the sampler or project team. This approach
is commonly used in sampling in support of enforcement activities because it is focused, requires
less time and resources than statistical designs, and is adequate for RCRA case development
purposes. Using knowledge of the site and waste generation processes, a sampling team may be
able to divide a site or waste sources into two categories: "low probability of a violation" and
"high probability of a violation." Sampling then can be conducted to characterize the waste
sources.
Probability sampling (sometimes called statistical sampling) refers to the use of specific
methods of random selection of sampling sites or population units. Probability sampling includes
simple random sampling, stratified random sampling, and systematic sampling. Chapter 9 of
EPA's SW-846 discusses the design of statistical sampling programs to be used by generators
to determine whether their waste exhibits the hazardous waste characteristic of toxicity. For
enforcement purposes, the regulatory agency is not required to follow the sampling and statistical
guidance outlined in Chapter 9 of SW-846.
To help decide which design is most appropriate, it helps to ask "If we had the data today,
what would we do with it?" or "how would we evaluate it?"
For example, one objective of an enforcement action might be to determine whether a waste
being managed as a solid waste at a facility exhibits the characteristic of a hazardous waste. In
this case, the sampling goal of the regulated community and that of the enforcement agency may
be different (i.e., concept of "proving the negative" in case development, see Hazardous Waste
Management System: Testing and Monitoring Activities, 55 FR 4440 (February 8, 1990):
• Goal of regulated community—Using SW-846 (or equivalent) methods and the
statistical approaches outlined in Chapter 9 of SW-846 (or other guidance contained in
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40 CFR 261.20(c)), owner/operators attempt to demonstrate that a regulatory threshold
has not been exceeded (i.e., proving the negative).
• Goal of enforcement agency—Regulatory agencies are concerned with demonstrating
that analyte concentrations in a waste exceed a regulatory level or the waste exhibits a
hazardous waste characteristic (i.e., proving the positive). This demonstration may not
require well-defined detection limits, adequate analyte recoveries, and high degrees of
precision. "If a sample possesses the property of interest, or contains the constituent at
a high enough level relative to the regulatory threshold, then the population from which
the sample was drawn must also possess the property of interest or contain that
constituent. Depending on the degree to which the property of interest is exceeded,
testing of samples which represent all aspects of the waste or other material may not be
necessary to prove that the waste is subject to regulation" (55 FR 4440, February 8,
1990).
11.3.5 Development a Sampling and Analysis Plan
The selection of sampling and analysis methods depends on the project objectives; however,
they must be scientifically sound. Chapter 9 of SW-846 presents guidance on developing
sampling plans. The selection of sampling methods is riot prescribed by regulation; however,
certain analytical methods are prescribed by regulation. Section 11.4 of this module discusses
these analytical methods. To determine whether a waste exhibits the characteristic of a hazardous
waste, for example, the generator may use any of the sampling methods listed in Appendix I, 40
CFR Part 261. Because the sampling methods are not formally adopted as regulation, Appendix
I is considered a "safe harbor" provision (also, see 40 CFR 261.20(c)). The sampling and
analysis plan should have built-in flexibility (i.e., provision for changes in the sampling and
analysis plan at various in-process stages, based on an evaluation of the site condition, project
objectives, and analytical results).
The sampling and analysis plan should include the following information:.
• Sampling team and responsibilities
• Number, type, and location of samples required, based on the established DQOs.
• Sampling equipment and sampling procedures, including use of special sampling
techniques (e.g., do not homogenize samples for volatile analysis)
• Sample preparation procedures (e.g., particle size reduction, mixing or compositing of
samples)
• Decontamination procedures (for equipment and personnel)
• Disposal of investigation-derived waste (i.e., disposable items contaminated as a result
of the enforcement sampling effort)
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• Procedures for filling sample containers, including use of contaminant-free
equipment/containers
• Sample preservation (e.g., shipping samples on ice, adding chemical preservatives)
• Sample identification and labeling
• Chain-of-custody procedures
• Cost-effective analytical plan utilizing appropriate sample preparation and cleanup and
determinative procedures to be used, based on the established DQOs
• Effective use of screening techniques (if applicable)
• Clearly defined QC procedures to verify effectiveness of sampling and analytical
procedures (e.g., type and frequency of field QC samples, splits and duplicates)2
• Sample shipping procedures
• Health and safety concerns (ensure use of appropriate protective equipment and
procedures in accordance with Occupational Safety and Health Administration
regulations)
• Documentation of sampling activities
- Project logbooks
- Sample tags
- Chain-of-custody and receipt for samples
- Photographs, maps, drawings
- Corrections to documentation
- Documents obtained from facilities being investigated
- Confidential business information claim.
11.4 SAMPLE ANALYSIS
Enforcement staff need to understand analytical methods so that they can defend their data
and fully understand data submitted by the regulated community. This section provides an
overview of analytical methods frequently used in the implementation of RCRA waste testing,
considerations in selecting methods, and an overview of laboratory procedures.
2. The owner/operator is entitled by statute to have split samples. If split samples are provided to the owner/operator,
he/she is responsible for arranging for his/her own laboratory to analyze the samples. According to '42 U.S.C. §
6927(a), "if the officer, employee, or representative obtains any samples, prior to leaving the premises, h& shall give
to the owner, operator, or agent in charge a receipt describing the sample obtained and if requested a portion of each
such sample equal in volume or weight to the portion retained."
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Many acceptable and, in some cases, required RCRA analytical methods are contained in
SW-846. This EPA document is the compendium of analytical and test methods accepted by
EPA's Office of Solid Waste. (OSW) for use in determining regulatory compliance under RCRA.
SW-846 functions primarily as a guidance document setting forth acceptable, although not
required, methods to be implemented by the user, as appropriate, in responding to RCRA-related
sampling and analysis requirements. Whether the regulated community uses SW-846 or
equivalent methods, it is important to understand how appropriate methods are selected. The
following discussion summarizes this process. It is important that the chemist understands the
analytical objectives delineated during the planning process. This will ensure that the chemist,
in conjunction with the sampler and those involved in determining the objectives, can develop
an appropriate analytical scheme.
11.4.1 Analytical Methods and Methods Selection
Except for situations for which the RCRA regulations specify use of a particular method,
the chemist should use judgment, tempered by experience, in selecting an appropriate set of
methods from SW-846 or the scientific literature for preparing and analyzing, a given sample.
The following factors, among others, affect the selection of analytical methods:
• Regulatory driver for a application of a particular method
• Analytical DQOs for the project
- Appropriate target analytes from the regulatory requirements and available information
on the particular application
- Matrices of concern
- Required confidence level for data to be generated
- Performance-based analytical parameters necessary to achieve this confidence level
- Sensitivity required (based on the action level, regulatory threshold, or other decision
point)
• Analytical methods that will meet these performance requirements
• Whether the application is one of the following, which requires the use of SW-846
methods (see Appendix A for a more detailed list)
- Determination of hazardous waste characteristics
- Determination of free liquid
- Analyses in support of a trial burn
- Analyses in support of a Delisting Petition
- Determination of air emissions from process equipment.
For all other RCRA applications, "any reliable method" may be employed.
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Method Selection
The choice of the appropriate sequence of analytical methods depends on the regulatory
requirements, information required, and experience of the analyst. In some cases, the objective
is to determine whether a waste is a characteristic waste (40 CFR §§ 261.20-24). In other cases,
the analytical objective is to determine the constituent concentrations in the waste or
environmental media (e.g., to determine whether there has been a release to the environment).
Hazardous Waste Characteristics
Chapter 8 of SW-846 presents analytical methods for determining characteristics. The
following list highlights technical considerations for characteristic waste determinations:
1. Ignitability based upon flashpoint
- Liquid waste
- Not an aqueous solution containing less than 24-percent alcohol by volume
- Flashpoint less than 140° F/60° C (the flashpoint is the temperature at which a
mixture of vapor [from the liquid sample] and air will "flash" for an instant when a
flame is introduced)
2. Corrosivity
- Aqueous wastes with pH less than or equal to 2 or greater than or equal to 12.5 (low
pH wastes are acidic, high pH wastes are basic, pH 7 is neutral) (pH scale is
logarithmic, e.g., pH 2 waste is 10 times more acidic than pH 3).
- Steel corroding liquid wastes
3. Toxicity
- Toxicity Characteristic Leaching Procedure (TCLP)
- Sampling (minimum sample size = 100 grams; may not be enough to get
representative samples)
- Sample preparation
— Particle size reduction (matrix must pass a 9.5-mm screen)
— TC extraction fluids generated by rotary extraction device
- Designed to deal with multi-phasic wastes
- After extraction step, sample analysis
— For the extraction step SW-846 Method 1311 required; for sample analysis to
determine constituent concentrations, SW-846 methods not required
- Practical concerns: RCRA toxicity characteristic based upon landfill leaching model/
not necessarily determinative of toxicity for other purposes (e.g., obtaining injunctive
relief)
- Cost (may be greater than $2,000 per sample)
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4. Reactivity
- No test methods prescribed—refer to regulatory definition
- EPA guidance (SW-846) sets forth methods to measure releasable cyanide/sulfide at
a pH between 2 and 12.5 (Note: these methods not applicable to all cyanide-bearing
wastes).
Constituent Concentrations In Waste and Environmental Media
Chapter 2 of SW-846 contains guidance on choosing the correct procedure for RCRA
analyses. In addition, EPA's Environmental Methods Monitoring Index (EMMI) is a useful tool
for selecting appropriate methods for particular target analytes.3
The analysis of wastes that are thought to be listed hazardous wastes cannot conclusively
establish that the waste is indeed listed. Such analyses can be used to determine whether certain
hazardous constituents are present and in what concentration. In addition, an expert (this can be
the EPA chemist) can use the data to develop an opinion on whether the sample analyzed is
consistent with expected findings in the listed waste. Typically, the analytical findings are used
to corroborate other evidence.
Laboratory Quality Assurance/Quality Control
Case developers should assess the strength of the evidence available by reviewing the
adequacy of QA/QC procedures used in the sampling and analysis. In addition, if QA/QC
procedures were not followed, the case development staff should assess how critical the lapse
may be to the overall case. Normally, QA/QC procedures should be determined and incorporated
into RCRA SAPs as part of the DQO process prior to initiation of the project. The following
standard analytical QC procedures are needed to determine that the sample handling procedures
and laboratory methods perform as required:
• Use of chain-of-custody in laboratory and proper storage (e.g., refrigeration).
• Analysis of appropriate numbers and types of blank samples to demonstrate the absence
of sample contamination from a variety of sources.
• Use of appropriate numbers and types of spiked samples to verify appropriate analyte
recovery.
• Use of duplicates/matrix spike duplicates to verify appropriate analytical precision.
• Use of appropriate surrogates to determine whether matrix effects may be present.
• Use of appropriate calibration procedures to optimize quantitation of target analytes.
3. EMMI is EPA's official methods data base linking 50 EPA regulatory lists, 2,600 substances, and 926 analytical
methods. EMMI is available from the National Technical Information Service (NTIS) (703-487-4650).
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• Use of appropriate test methods (Again, must make method selection in light of overall
objectives. Remember that many analytical procedures approved by EPA are for use by
regulated community in demonstrating that materials or wastes contain low levels of
contaminants and should not be regulated. In other words, they must demonstrate that
a contaminant is not present at regulatory levels. In an enforcement case, the object is
to show that a contaminant is present. Analytically, this is a different task, and the
same test methods may not be suitable).
• Confirmatory analyses by an alternate test method.
The following issues are related to the reliability of data:
• Method detection limits (must be below regulatory threshold and be specific to samples
being analyzed—cannot be theoretical number from a manual)
• Sample holding times (See TCLP Method Section 8.4 and 55 FR 4440 [February 8,
1990])4
• Sample preservation
• Matrix interferences that could cause false positive
Note: To establish that the analytical results obtained by the laboratory are reliable and,
therefore, admissible, a showing must be made that appropriate quality assurance/quality controls
were employed from the point the sample was taken in the field until all analyses were
completed. Perfection is not required, however, and cases can be successfully prosecuted if
sufficient reliable data and other evidence are available. At times, the data may be inconclusive
and other evidence must be adduced.
In addition, other factors should be considered:
• EPA Contract Lab Program (CLP) protocols (often used by the defense as technical
"holy grail," yet typically relate only to format requirements specified in contract
"statement of work"; may have no bearing on data quality)
• Preliminary/screening analyses allow laboratory to focus on critical samples (e.g., TC
toxicity)
• Whether results will be independently validated
4. "Results of samples not analyzed within the specified holding time will be considered minimum values. That is,
the actual concentration will be assumed for regulatory purposes to be equal to or greater than the concentration
determined after the holding time has expired." (55 FR 4440, 4443 [February 8, 1990])
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• Sample retention/disposal
- Establish/follow policy
- Address case-by-case
- Secure permission of court.
11.4.2 Overview of Frequently Performed Analyses
The analytical methods described in this section address the major methods used or
encountered in assessing environmental media. The information presented provides an overview
of the methods used for various types of compounds and how each method is implemented.
Metals
Metal analyses are measurements of the amount of a particular metallic element in a sample.
A more scientifically correct name for this type of analysis is "elemental" because many
nonmetallic or metalloid elements (e.g., arsenic) can also be determined by these techniques.
Before instrumental analysis can proceed, the elements of interest must usually be dissolved
in a liquid. This process, called "digestion," is usually accomplished by boiling the sample in
acids. Digestion may not be necessary for water samples if the elements are already dissolved
in the water. However, it is always possible that even water samples that appear clear may
contain small particles to which the elements are attached.
The three types of detectors most often used for elemental analyses are:
• Atomic Absorption (AA) Spectrometer)—In this instrument, the sample is introduced
into an oxyacetylene flame, and the wavelengths of light absorbed by the sample are
analyzed to determine whether a particular element is present. Only one element can be
determined at a time with this instrument.
• Inductively Coupled Argon Plasma Optical Emissions Spectrometer (ICP-OES)—In
this instrument, the sample is reduced to its elemental constituents by an argon plasma
torch at about 10,000° F. The light emitted from the sample is then analyzed for
wavelengths that are characteristic of certain elements. This instrument can measure
more than 20 elements at a time, but is more susceptible to interferences from other
elements present in the sample than AA analysis. It also requires more sophisticated
processing of data than AA analysis.
• X-Ray Fluorescence Spectrometer—This instrument bombards the sample with x rays
and then measures the wavelengths of the light emitted by the sample. The elemental
constituents of solids can be measured by this technique. It must be remembered,
however, that x-ray absorption only occurs on the surface exposed to the x rays.
Therefore the sample must be completely homogeneous for this technique to be'used in
any sort of quantitative manner. While this instrument is very fast and can analyze up
to 80 elements simultaneously, the detection limits are usually much higher than those
from AA or ICP-OES.
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Organics
Organic compounds usually must be transferred from the sample matrix, such as soil or
water, to a solvent, such as hexane or methylene chloride, before analysis. This process, called
"extraction," can involve a variety of techniques, including Soxhlet extractions and continuous
liquid/liquid extractions. The exceptions are volatile compounds, which can be removed from
their sample matrix by bubbling gas through the sample and collected using the "purge and trap"
technique. Four types of instruments are most commonly used for organics analyses:
• Gas Chromatograph (GC)—GC is the basic separation tool of environmental organic
chemistry. Once the sample has been extracted into a solvent, a portion of the solvent
is injected into a heated port where the organic compounds are vaporized. The now
gaseous compounds are transported by an inert gas, the "carrier gas," through a heated
glass column. The inside of the column is coated with a material called the "stationary
phase." The gaseous compounds dissolve in this stationary phase and are released back
into the carrier gas stream at different rates, depending on the chemical natures. As a
result, different compounds travel through the column at different speeds. The time it
takes for the compound to travel the length of the column is characteristic of that
compound and is called the "retention time" because it is the amount of time the
compound is retained in the column.
GCs can be equipped with different detectors, some of which are only sensitive to
certain types of compounds. Other detectors are more universal in their response to
organic compounds. The most common detectors are the flame ionization detector,
which is sensitive to almost all organic compounds; the electron capture detector (ECD),
which is extremely sensitive to compounds containing chlorine, such as polychlorinated
biphenols (PCBs) and many pesticides; and the Hall electrolytic conductivity detector
(HECD), which is sensitive, though less so than an ECD, only to halogenated
compounds, most of which are chlorinated.
The output of a GC is a strip chart of the detector response against time, known as a
"chromatogram." When the detector responds to a particular compound, a "peak" will
be traced on the chart.
• Gas Chromatograph/Mass Spectrometer (GC/MS)—A GC/MS is a GC with an MS for
a detector. After a particular compound has passed through the GC column, it is
shattered by impact with a stream of high energy electrons, creating ions, which are then
sorted by mass and detected. The instrument can produce a graph of the intensity of
each ion at a particular time, known as a "mass spectrum," that is characteristic of a
particular compound. The mass spectrum is compared with the spectrum from a
standard containing the pure compound or can be compared by computer to a library of
more than 50,000 different organic compounds. A chemist with a certain amount of
expertise must judge the "goodness" of the library search results before the compound
can be considered identified.
• High Pressure Liquid Chromatography (HPLC)—HPLC is similar to GC, but a liquid,
rather than a gas, is used to carry the compounds through the column. This eliminates
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the need for volatilizing the sample in a heated injector port and permits the analysis of
nonvolatile organic compounds, such as resins, and compounds that labile (break apart)
when heated.
HPLC, detectors are not as sensitive as GC detectors, however. The most common
detector used with HPCL is the ultraviolet (UV) detector, which passes UV light through
the sample and records when certain selected wavelengths are absorbed.
• Infrared Spectrometry (IR)—IR is most suited for pure or relatively pure samples. A
portion of the sample is placed in a beam of infrared light, and the wavelengths absorbed
are recorded as a spectrum, which can be compared to standard reference spectra. This
technique is very quick and straightforward but usually lacks a separation technique. If
more than one compound is present in the sample, therefore, the spectra for each
compound are superimposed over the others, making the results difficult to interpret.
Pesticides/Polychlorinated Biphenyls
Determining the presence of pesticides ana fUBs is orten separate trom other organic
compound analyses. Analyses for pesticides and PCBs are usually performed on a GC with an
ECD or HECD detector. While a wide range of pesticides may be analyzed at one time, many
of these methods focus on the 18 organochlorine pesticides on the original EPA priority pollutant
list. Most of these have been banned from use in the United States.
PCB analysis is often a subset of pesticide analysis because the components of transformer
oils and dielectric fluids may be determined using the same GC instruments and conditions.
PCBs are usually found as mixtures called Aroclors, the trade name used by the manufacturer
who distributed them in the United States. Aroclors are mixtures of a large number of individual
PCBs and are classified by the weight percent of chlorine in the mixture. Most PCB methods
address the seven most common Aroclor mixtures—Aroclors 1016, 1221, 1232, 1242, 1248,
1254, and 1260. Analyses may be performed for some of the 209 possible individual PCB
congeners; however, this type of analysis is more difficult to interpret because the regulations are
written on the basis of the Aroclor mixtures and there is no clear-cut approach to transform PCB
congener results to an Aroclor concentration.
Herbicides
Although the most well-known chlorophenoxy acid herbicides are 2,4-D, 2,4,5-T, and
Silvex, a wide range of herbicides may be analyzed using available EPA methods.
Identification/Compositional Analyses
Depending on the types of compounds present in the sample and their purity, the full range
of analytical chemistry determinations may be required to identify all the "chemicals" present.
Frequently, this may simply not be possible within the bounds of time and resources. Usually,
complete compositional analysis is not necessary. The major components can often be identified
by class, such as hydrocarbons, instead of as individual compounds, such as 2-methyl-3-
ethyltoluene.
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Asbestos
Bulk asbestos is determined by polarized light microscopy. The fibers in the sample are
counted under a microscope. The percentage of asbestos fibers compared to the total number of
fibers is necessarily an estimate and its accuracy depends on the experience and skills of the
analyst.
Immunoassay Test Kits
Immunoassay is a relatively new analytical technique useful for separating, detecting, and
quantifying both organic and inorganic analytes in diverse environmental and waste matrices.
Immunoassay test products use an antibody molecule to detect and quantify a substance in a test
sample. These testing products combine the specific binding characteristics of an antibody
molecule with a detection chemistry that produces a measurable response used for interpretation.
The basic technique has been used in medical testing for many years and environmental testing
applications have been in use for almost a decade.
Immunoassay methods are used to produce two types of quantitative results:
• Range-finding or screening results indicative of compliance with an action level
• Assay values.
Commercially available testing products provide immunoassay protocols that are rapid,
simple, and portable. These products can be used effectively in both laboratory and field settings
and require limited training. These test products substantially increase the number of data points
that can be generated within a given period and permit an operator to analyze a number of
samples simultaneously within a relatively short period of time. Results are available
immediately upon completion of the test and can assist in the onsite management of personnel
and equipment, as well as the data management activities of the laboratory.
Immunoassay methods can provide quantitative data when configured with a series of
reference standards that are analyzed and used to construct a standard curve. The signal
generated from the analysis of a test sample is used to determine concentration by interpolation
from the standard curve. Alternatively, these testing products can be configured to determine
whether a sample is positive or negative relative to a single standard.
EPA OSW reviews and accepts individual immunoassay testing products for the detection
of sample analytes in specified matrices. A variety of testing products, produced by several
different developers, may be available for the same compound(s) and matrices. Each of these
methods has been formulated using independently developed reagents that may result in
significantly different performance characteristics and limitations.
Appendix B provides the immunoassay methods given in the 3rd Update to the Third
Edition of SW-846.
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As with any analytical effort, the choice of the most appropriate procedure will depend on
the DQOs developed for the specific project. When employing immunoassays, the user should
consider the following factors:
• The availability of immunoassays specific to the compounds of interest
• Whether the immunoassay will be used simply as a screening tool or as an assay
• The action level(s) associated with the compounds of interest, relative to the sensitivity
of the immunoassay
• Whether the immunoassay will be supported by some percentage of confirmation
analyses by other techniques (i:e., GC, GC/MS).
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Appendix A
Required Versus Optional Use
of SW-846 Testing Methods
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Required Versus Optional Use of SW-846 Testing Methods
Certain hazardous waste regulations under Subtitle C of RCRA require that specific testing
methods described in SW-846 be employed for certain applications. Any reliable analytical
method may be used to meet other requirements in 40 CFR Part 260 through 270. The following
list highlights a number of provisions contained in 40 CFR Parts 260 through 270 that require
use of a specific method for a particular application or use of appropriate SW-846 methods in
general:
• Section 260,22(d)(l)(i)—Submission of data in support of petitions to exclude a waste
produced at a particular facility (i.e., delisting petitions)
• Section 261.22(a)(1) and (2)—Evaluation of a waste against the corrosivity characteristic
• Section 261.24(a)—Leacbrag psocedure foT evaluation of a waste against the toxicity
characteristic
• Section 261.35(b)(2)(iii)(A)—Testing of rinsates from wood preserving cleaning
processes
• Sections 264.190(a), 264.314(c), 265.190(a), and 265.314(d)—Evaluation of a waste to
determine whether free liquid is a component of the waste
• Sections 264.1034(d)(l)(iii) and 265.1034(d)(l)(iii)—Testing of total organic
concentration for monitoring compliance with air emission standards for process vents
• Sections 264.1063(d)(2) and 265.1063(d)(2)-^Testing of total organic concentration for
monitoring compliance with ait emission standards for equipment leaks
• Section 266.106(a)—-Analysis in support of compliance with standards to control metals
emissions from burning hazardous waste in boilers and industrial furnaces
• Section 266.112(b)(1) and (2)0)—Certain analyses in support of exclusion from the
definition of a hazardous of a residue which was derived from burning hazardous waste
in boilers and industrial furnaces
• Section 268.32(i)-Evaluation of a waste to determine whether it is a liquid for purposes
of certain land disposal prohibitions
• Sections 268.40(a), (b) and (f), 268.41(a), and 268.43(a)—Leaching procedure for
evaluation of waste extract to determine compliance with land disposal treatment
standards
• Section 268./(a)—Leaching procedure for evaluation of a waste to determine whether
it is restricted from land disposal
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• Sections 270.19(c)( 1 )(iii) and (iv) and 270.62(b)(2)(i)(C) and (D)—Analyses and
approximate quantification of the hazardous constituents identified in the waste prior to
a trial burn in support of an application for a hazardous waste incineration permit
• Sections 270.22(a)(2)(ii)(B) and 270.66(c)(2)(i) and (ii)—Analysis conducted in support
of a destruction and removal efficiency trial burn waiver for boilers and industrial
furnaces burning low-risk wastes and analysis and approximate quantification for a trial
burn in support of an application for a permit to burn hazardous waste in a boiler and
industrial furnace.
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Appendix B
Immunoassay Methods
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Immunoassay Methods
Method 4000 -
Method 401 OA -
Method 4015 -
Method 4020 -
Method 4030 -
Method 4035 -
Method 4040 -
Method 4041 -
Method 4042 -
Method 4050 -
Method 4051 -
Immunoassay (the "base" method for SW-846 immunoassay techniques
that describes much of the theory and specifications common to the
subsequent actual test methods)
Screening for Pentachlorophenol by Immunoassay
Screening for 2,4-Dichlorophenoxy Acetic Acid by Immunoassay
Screening for Polychlorinated Biphenyls by Immunoassay
Soil Screening for Petroleum Hydrocarbons by Immunoassay
Screening for Polynuclear Aromatic Hydrocarbons in Soil by
Immunoassay
Soil Screening for Toxaphene by Immunoassay
Soil Screening for Chlordane by Immunoassay
Soil Screening for DDT by Immunoassay
TNT Explosives in Water and Soils by Immunoassay
Hexahydro-l,3,5-trinitro-l,3,5-triazine (RDX) in Soil and Water by
Immunoassay
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12. COMPLIANCE ASSISTANCE
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Module 12 Objective
• Understand EPA's compliance assistance
program
• Discuss types of compliance assistance
• Identify national and local programs
• Understand the development process for
compliance assistance activities
• Discuss measures of program success
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Background
• Reorganization of EPA enforcement program
and creation of OECA
• Realization that traditional enforcement tools
could not, in isolation, result in sustained
compliance
• Determination to combine compliance
assistance and promotion programs with the
traditional enforcement and compliance
monitoring programs
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Components of Enforcement and Compliance
Assurance Program
1 Compliance assistance
Compliance monitoring
Enforcement actions
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Compliance Assistance Defined
Information or technical advice provided by
EPA, states, or local governments to help
regulated parties understand and comply
with statutory and regulatory requirements.
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Types of Compliance Assistance
Outreach
Response to inquiries
Onsite assistance
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Outreach
A
• Is the most familiar type of compliance
assistance
• Includes publications, training, seminars
• Targets both single-media program goals and
specific industry sectors
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Response to Inquiries
• Receive literally thousands of requests for
assistance
Track requests to target specific programs or
sectors for compliance assistance
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Onsite Assistance
• Site visits by regulatory agency personnel
• Different than compliance inspections
(although inspectors may be used to provide
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Nontraditional Compliance Assistance
• May be used in addition to more traditional
approaches
• Includes mentoring programs or other types
of programs in which larger, more
sophisticated companies assist smaller
companies with compliance and
environmental management issues
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Current Status of Compliance Assistance
• EPA is conducting detailed analyses to target
specific programs/sectors for compliance
assistance.
• The analysis focuses on various factors:
- Noncompliance rates
- Inspections conducted per sector
- Inspections that lead to enforcement actions
- Types and amounts of pollutants discharged.
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Studies in Compliance Assistance
• EPA, states, and local authorities are
developing and implementing compliance
assistance programs.
• Programs usually include some incentive to
comply and often include correction periods
in which to correct identified violations.
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State/Local Programs
• City of Santa Rosa (California)
• Tennessee Department of Environment and
Conservation
• Washington State Department of Ecology
• Oregon Department of Environmental
Quality
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EPA Headquarters/Regional Programs
• Compliance assistance centers
• Environmental auditing
• Clean Air Act Section 507 policy
• Environmental Leadership Program
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EPA Headquarters/Regional Programs
(Continued)
• Common Sense Initiative
• Small business compliance incentives
• Small communities policy
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Compliance Assistance
Developing Compliance Assistance
• Target specific industry sectors
• Establish partnerships/alliances
• Target compliance
• Develop compliance strategies
• Revise programs, as necessary
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Developing Compliance Assistance (Continued)
• Target specific industry sectors
- Research general industry profile
- Identify environmental problems and
requirements
- Identify EPA's enforcement priorities
- Develop enforcement profile
- Talk with stakeholders
- Identify compliance assistance efforts to date
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Developing Compliance Assistance (Continued)
• Establish partnerships/alliances
• Target compliance problems, issues, and
needs
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Developing Compliance Assistance (Continued)
• Develop compliance strategies
• Revise programs as necessary
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Measures of Success
• EPA needs to develop some measurement
tools to truly gauge the success of its
compliance assistance efforts.
• EPA established a work group that developed
five recommendations for a measures of
success program.
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Measures of Success Work Group
Recommendations
• Implement systematic reporting of environmental
and programmatic impacts through use of the case
conclusions data sheet
• Assure consistency in data definitions across all
media programs
• Develop measures evaluating programmatic impacts
• Institute use of an enforcement authority index for a
better balanced profile of Agency enforcement
• Expand scope of existing reporting measures to
incorporate new Agency actions
V
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Status of Measures of Success Program
• Several recommendations are currently being
implemented and reviewed.
• EPA recognizes that the program will take
extensive time and resources.
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Next Steps
• Coordinate with other enforcement offices
• Continue development of sector expertise
• Undertake pilots
• Continue to develop and test measures of
success
• Develop a well-balanced approach and
achieve the appropriate mix of enforcement
actions and compliance monitoring
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12. COMPLIANCE ASSISTANCE
Background Materials
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12. COMPLIANCE ASSISTANCE
When reorganizing its enforcement and compliance program and creating the Office of
Enforcement and Compliance Assurance (OECA), the U.S. Environmental Protection Agency
(EPA) realized that the changes would affect all levels of its national enforcement program,
including headquarters, the regions, and the states. EPA knew that the national program itself
would need to be "reinvented." An integral part of reinventing the national program was
recognizing that EPA's traditional enforcement tools—monitoring, administrative actions, criminal
sanctions, and monetary penalties—could not, in isolation, lead to sustained compliance in the
regulated community. After detailed analysis, Agency officials determined that EPA needed to
combine compliance assistance and promotion programs with the traditional aspects of
compliance monitoring and enforcement. The heart of EPA's national enforcement program now
comprises the following components:
• Compliance assistance—Activities designed to assist the regulated community and
encourage voluntary compliance with regulations
• Compliance monitoring—Activities designed to provide information on the compliance
status of the regulated community
• Enforcement actions—Powerful sanctions designed to compel compliance by the
regulated community.
Specifically, the compliance assistance component addresses the need to re-examine the
Agency's approach to the regulated community and enforcement and to begin taking a holistic,
multimedia view of the process of achieving compliance and addressing environmental problems
on a sector-wide and ecosystem basis. The mission of OECA's Office of Compliance (OC) is
to implement this concept.
Rather than maintain the traditional media-specific organizational structure, OC is structured
along industry and economic sector lines. By focusing on sectors of the economy, as defined by
Standard Industrial Classification codes, OC can identify and address significant environmental
problems at the process levels rather than at the-end-of-pipe or stack. The result is an office that
is more strategic and less reactive. Currently, OC is directing most of its effort toward the
development of programs that help industries comply. This module, therefore, focuses on such
compliance assistance.
12.1 COMPLIANCE ASSISTANCE DEFINED
EPA defines compliance assistance as information or technical advice provided by EPA,
states, or local governments to help regulated parties understand and comply with statutory and
regulatory requirements. While participation in compliance assistance activities is voluntary on
the part of the regulated entity, it should not be confused with other voluntary Agency efforts or
programs, such as 33/50 (voluntary emissions reductions by certain percentages by q. certain
time), Green Lights (voluntary programs to reduce greenhouse gases), and Design for the
Environment (program with industry to identify and address problematic process areas). These
programs are intended to achieve environmental objectives that are not enforceable under Federal
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law; compliance assistance is intended to achieve compliance with enforceable laws. Currently,
EPA conducts three types of compliance assistance activities:
• Outreach
• Response to inquiries
• Onsite assistance.
Outreach is probably the most familiar type of compliance assistance conducted by the
Agency. It includes publications, training, seminars, and other types of public efforts that inform
the regulated community and the public of specific requirements. Technical assistance to the
regulated community is also considered compliance assistance because its ultimate goal is to
achieve compliance. In today's world of technology and cyberspace, EPA can expand its
outreach efforts through electronic bulletin boards and CD-ROM interactive software, as well as
through the Internet.
Traditionally, compliance assistance has been structured around single-media program goals.
However, the Agency expects to complement its existing single-media efforts by developing and
supporting multimedia information and technical assistance services to specific industry sectors,
such as the dry cleaning and printing sectors. These types of efforts will address the need to
provide clear and consistent information to members of the regulated community who face
multiple requirements, specifically members who are too small to develop in-house regulatory
expertise. The Great Printers Project, which is supported by a coalition of industry,
environmental groups, EPA, and states, is a perfect example of such an approach.
Response to inquiries is another method of compliance assistance. EPA, state, and local
agencies routinely receive thousands of requests every day for help interpreting specific
regulations or determining the applicability of those regulations to a specific entity. EPA
responds to these requests in a number of ways, ranging from hotlines to informal responses
prepared and distributed by program and regional staff. Frequently, these inquiries provide the
basis for the outreach activities. If the Agency receives numerous questions on a specific subject,
it may indicate the need for a formal outreach program.
EPA, state, and local staff often find it useful to visit facilities to explain new requirements
and offer guidance regarding cost-effective compliance technologies. This onsite assistance
approach can be an efficient way to familiarize the regulated community and Agency staff with
the practical applications of new requirements and to heighten awareness of the specific
requirements. Onsite assistance efforts are sometimes undertaken by technical assistance
programs that are managed by separate agencies (e.g., the Massachusetts Toxics Use Reduction
Institute). Or, the role of the inspector may be to provide onsite assistance. EPA and state
inspectors often possess the practical knowledge of regulatory requirements and industrial
operations that enable them to provide assistance.
However, it is imperative that inspectors not forget their primary responsibility while onsite,
which is to detect violations and any actual or potential harm. In general, it is most appropriate
for inspectors to offer compliance assistance either to large groups or to individual facilities as
part of a targeted effort to reach a specific business sector. It is least appropriate when an
inspector is conducting a compliance inspection after a violation has already been identified.
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Currently, the role of the inspector is the subject of several Agency workgroups. These
workgroups are trying to address the inconsistencies between an inspector wearing a compliance
hat and an enforcement hat.
Many inspectors already participate in seminars, training, and other activities designed for
a wide audience, rather than individual facilities. Such activities provide an important service
to the regulated community and generally present no controversy. Some states even assign
inspectors to visit facilities within a targeted industry to explain regulatory requirements and offer
technical advice regarding compliance. Potential violations discovered during these visits are
usually not referred for enforcement action unless they present significant hazards or are criminal
violations. Rather, businesses are allowed some opportunity to correct the problem with the
understanding that continued noncompliance would trigger future enforcement. These types of
efforts reflect a conscious decision to temporarily refrain from taking enforcement actions to
allow targeted industries to better understand regulatory requirements and demonstrate a
commitment to compliance.
State initiatives to provide onsite assistance can be distinguished from compliance
inspections because their primary purpose is to inform and motivate businesses to comply, rather
than to document potential violations for subsequent enforcement action. To avoid confusion,
inspectors should take part in compliance assistance efforts only when they are part of a
predetermined strategy to reach a particular sector of the regulation community. These types of
consultations should also avoid shielding a facility from future enforcement actions for violations
that have not been corrected, as described in the next paragraph.
As a general rule, inspectors conducting a compliance inspection are not expected to offer
specific advice that might offer the facility a defense against enforcement actions brought by
EPA. Inspectors may refer facility representatives to other neutral sources of advice that may
be useful in returning a facility to compliance, however. The 7995 RCRA Inspection Manual
contains further discussion on this topic.
In addition to these traditional compliance assistance activities, there is a recent move
toward nontraditional compliance assistance, such as mentoring programs and other programs in
which larger industries help smaller industries in the same sector with compliance. For example,
the John Roberts Company, a small lithographic printing company that was selected for EPA's
Environmental Leadership Program (ELP), is developing a mentoring program in which larger,
more sophisticated companies develop model training programs to help smaller businesses both
achieve and stay in compliance while also remaining competitive. Other companies involved in
the ELP, including Motorola and Ocean State Power, are developing similar mentoring programs.
A fourth ELP facility, Simpson Tacoma Kraft Company, is proposing implementation of an
"Adopt a Supplier" technical exchange program. While not focusing on businesses in its same
sector, Simpson will be sharing its environmental and regulatory expertise with smaller, less
sophisticated companies. For more information on the ELP, see Section 2.2.4 of this module.
12.2 STUDIES IN COMPLIANCE ASSISTANCE
The Agency believes that the most effective and efficient method to assuring compliance
is for the regulated community tp comply voluntarily. For this to occur, the regulated community
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must understand the full spectrum of regulations and share information about new or existing
technologies. Of the different entities (e.g., EPA, states, local authorities, or governments)
developing compliance assistance programs, the concept of their programs appear to be similar
in scope. For example, several of the current programs offer some type of immunity from
enforcement action if compliance assistance is requested, or grace periods in which to correct
violations are granted if the facility seeks assistance from the regulatory agency or penalty
reductions. The following sections detail some of the various types of compliance programs that
are currently in use at both the state/local and federal levels.
12.2.1 Role of State and Local Governments
As indicated in EPA's definition, State and local governments play a critical role in
compliance assistance. This is appropriate because they have responsibilities for implementing
federal compliance and enforcement programs. Generally, state and local compliance assistance
initiatives are offered as part of overall Agency programs and may be partially supported by EPA
media grants. The following sections describe four state or local compliance assistance programs.
City of Santa Rosa (California)
The City of Santa Rosa, California, Utilities Department, Industrial Waste Section, sponsors
the Sonoma Green Business Compliance Incentive Program, which is a compliance assistance
program aimed at improving compliance with environmental regulations by providing compliance
and technical assistance and positive incentives to business. The program was originally designed
to reduce inflow of organic solvents to Santa Rosa's wastewater reclamation plant from its largest
hazardous waste-producing industry—vehicle services.
Prior to program implementation, inspectors for the wastewater treatment plant were
responsible for monitoring discharges and issuing citations to halt illegal discharges. This added
to the confusion and frustration on the part of vehicle service owners, who already believed the
regulations and requirements were unclear and often conflicting. The Compliance Incentive
Program was designed to reduce the frustration and help the owners comply with the
requirements by providing technical assistance, multimedia regulatory streamlining, and public
recognition and awareness. Every facility that participates in the program receives a sticker
certifying it is a Sonoma Green Business and is in full compliance.
When a business signs up for the program, it receives an information package containing
the following items:
• Details on the program
• Best management practices from all environmental media for automotive service/repair
shops
• Vehicle service facility checklist that is a self-inspection checklist based on the
requirements of all environmental regulatory agencies
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• Vendor list for equipment and services that could help the facility comply
• Answers to the six most frequently asked questions.
Participating shops are inspected by the city's industrial waste inspectors or inspectors from
other environmental agencies trained to make the multimedia inspection required by the program.
If the shops are in compliance, they receive the sticker. If not, depending on the Enforcement
Response Policy, a shop may be given a grace period in which to correct the violation.
Compliance by auto shops was essentially nonexistent prior to the program but is now
significantly higher.
Tennessee Department of Environment and Conservation
In 1993, the Tennessee Department of Environment and Conservation implemented its
Underground Storage Tank (UST) Compliance Inspection Program. The goal of the program is
to provide compliance assistance via voluntary inspections at UST facilities. This program grew
out of the need to inspect a large number of tanks at a variety of facilities across a large
geographic area with limited manpower and dollars. (There are nearly 6,000 tank owners in
Tennessee.) The concept is to sign up UST owners and have them participate in voluntary
inspections at their facilities (or a subset of their facilities) and then apply what they learned in
the inspections to other facilities they own.
Tank owners who volunteer for the program receive inspections by the regulator. After
each inspection, owners are made aware of the violations identified and then must correct those
violations at the inspected facility, as well as at any other facility they own, if applicable. The
owners then are responsible for ensuring that the rest of their facilities are in compliance. The
typical grace period for correcting violations is 30 days. In the first year of the program, 500
compliance inspections were conducted. Of the 500 facilities inspected, only 4 were not in full
compliance within the 30-day time frame.
Washington State Department of Ecology
In January 1992, the Washington State Department of Ecology (DOE) initiated its "Shop
Sweeps" Automotive Campaign. The campaign has three goals:
• Education—To better educate DOE and local government on the complexities of day-to-
day management of automotive hazardous wastes
• Compliance—To help the automotive repair industry understand and voluntarily comply
with hazardous waste requirements
• Pollution prevention—To promote waste reduction and recycling as a compliance and
environmental quality tool.
The campaign grew out of a partnership between industry and government, in which DOE
approached automotive trade associations with the concept of providing fair and efficient
compliance assistance in exchange for increased compliance and cooperation. The goal is to
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conduct numerous onsite shop visits that are short and basic and to disseminate easy-to-read
educational materials targeted to a variety of auto shop specialty services. The campaign targets
small- to medium-sized businesses.
Currently, the program does not have a compliance component (i.e., the inspectors do not
determine compliance). Individual shops decide whether to voluntarily work toward achieving
compliance. Inspectors do not write up potential violations or issue notices of violations (NOVs)
or citations. They do, however, leave the facility with a "to do" list that would improve their
waste management, recycling, and reduction. For participating facilities, there is no guarantee
that a normal hazardous waste inspection will not be conducted at another time.
In the first year and a half of the program, more than 1,400 shops were visited. Literally
thousands more received mailings of educational materials and outreach via industry associations
and DOE. To gauge the success of the program, DOE conducted followup visits to 5 percent
of the shops (85 shops). Of those 85, 82 percent had complied with at least one recommendation
made by the inspector, and 15 percent of the remaining facilities had tried or were in the process
of complying with at least one recommendation. Of the original shop sweep recommendations,
shops complied with 61 percent of the recommendations, attempted to comply with 25 percent
of the recommendations, and made no attempt to comply with the other 14 percent.
Oregon Department of Environmental Quality
Based on a law passed by the Oregon legislature in 199.1, the Oregon Department of
Environmental Quality (DEQ) established a small business technical assistance program. The
goal of the program is to increase compliance rates with hazardous waste management standards
by providing information to smaller businesses on regulatory requirements and to assist those
businesses in achieving Compliance. The program is aimed at conditionally exempt generators
of hazardous waste and other generators with fewer than 50 employees. To date, the program
has had two somewhat distinct modes of operation: 1) a standard program in which DEQ staff
respond to requests for compliance assistance and 2) a "blitz" involving more aggressive outreach
but more limited assistance to each facility.
In the first mode, if businesses contact DEQ and request assistance, a site visit is conducted.
This site visit includes the same components of a compliance inspection, but citations are not
issued for identified violations (except for violations that pose "clear and immediate danger").
Instead, the person who conducted the site visit and the facility negotiate a compliance schedule,
and the facility is required to notify DEQ when it has corrected the violations. Small Business
Technical Assistance staff document all instances of noncompliance and incorporate them into
an environmental management assessment (EMA), which is included in the regional hazardous
waste program files. The EMA is similar to a notice of noncompliance, but does not carry with
it the followup enforcement action. The blitz approach, rather than waiting for facilities to
contact DEQ, includes sending letters, followed by telephone calls, offering compliance assistance
to all small quantity generators, conditionally exempt generators, and approximately 100
unregistered businesses. During 3 months in 1994, 470 facilities received compliance assistance
visits. These visits were basically similar to those noted previously, but the visits and preparation
were far less intensive.
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Under both program modes, a key component is the development and use of user friendly
regulatory guides, fact sheets, and handbooks that are given to facility representatives. No formal
statistics are currently available on the program success at increasing compliance rates.
12.2.2 Role of Headquarters and Regions
EPA headquarters and regions are currently directing significant effort toward the
development of programs that assist industries of all sizes with compliance. As noted earlier,
states and local governments are intimately involved in compliance assistance because of their
day-to-day interactions with facilities. But headquarters and the regions develop the policies and
procedures to facilitate compliance assistance. Headquarters and the regions also develop and
implement national programs, which include the state and local programs. The Agency is
developing and implementing several compliance assistance programs nationally. The following
sections discuss some of these activities.
Compliance Assistance Centers
The Office of Compliance, in partnership with industry, academia, environmental groups,
and other federal and state agencies, is proposing to develop four compliance assistance service
centers. The assistance centers would provide a "one-stop shopping" for the targeted sectors (i.e.,
printing, metal finishing, auto repair, and small farms) and would distribute prepared materials
consolidating information about compliance requirements, pollution prevention, and technical
assistance resources. Such materials are available for use by state assistance programs, trade
associations, and individual companies. The centers would also network with Small Business
Development Centers, provide InterNet access, and distribute toll-free telephone numbers. In
addition, technical assistance and training would be available on applicable treatment
technologies.
Environmental Auditing
EPA is facing a double challenge in environmental auditing. On one hand, EPA is looking
to develop incentives to encourage self-auditing and self-policing. On the other hand, the Agency
does not want to totally forsake its ability to penalize non-compliers, who may be experiencing
economic benefits as a result of noncompliance. The Agency's existing auditing policy, released
in 1986, addresses the importance of audits and their role in compliance. However, the policy
does not provide incentives to conduct self-audits, because the results would not necessarily be
off limits to the Agency, which could then rely on the audit to take an enforcement action. In
April 1995, therefore, EPA released a revised auditing policy in the Federal Register (60 FR
16875). This interim policy provides incentives to regulated entities to conduct voluntary
compliance evaluations and to disclose and correct violations. The interim policy includes
incentives, such as eliminating or substantially reducing the gravity component for civil penalties
and not referring cases for criminal prosecution if specified conditions are met. The interim
policy also provides that EPA will not request voluntary audit reports to trigger enforcement
investigations. The interim policy is effective 15 days after publication.
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Clean Air Act Section 507 Policy
Another example of EPA's emphasis on assistance is reflected in its development of the
Clean Air Act Section 507 enforcement policy. Section 507 requires each state to establish a
program designed to assist small businesses meet their obligations under the law. The
enforcement policy was issued in response to state concerns that small businesses would not seek
assistance if violations discovered during their participation resulted in enforcement actions. The
policy encourages small businesses to participate by offering states with delegated enforcement
authority two options:
• Limited correction period—Small business assistance programs can provide businesses
that receive compliance assistance a limited correction period of up to 90 days for
violations detected during the program, with the possibility of an additional 90-day
extension. Any violations remaining after the limited correction period are subject to
existing enforcement response policies.
• Confidentiality—Instead of providing a limited correction period, certain small business
assistance programs may guarantee that information identifying participating businesses
where violations were detected will be kept confidential. This confidentiality
requirement does not apply to any violations discovered independent of the Section 507
program. Also, this confidentiality option can only be offered if the program is operated
independent of the states delegated regulatory enforcement program.
Envirpnmental Leadership Program
The Environmental Leadership Program is currently being piloted by EPA to recognize
companies willing to develop innovative approaches to establishing accountability for compliance
with existing standards in environmental laws. In Aprii 1995, EPA announced the selection of
12 pilot projects at industrial facilities and federal installations that have volunteered to test the
design of the following specific elements of the ELP:
• Advancing the design of sophisticated environmental management systems
• Incorporating multimedia compliance assurance into facility management
• Using third-party verification to provide assurance of performance and self-certification
for reporting
• Implementing public measures of accountability
• Involving the community in setting goals and reviewing results
• Implementing mentoring programs to help small businesses find cost-effective ways to
comply with the law.
In return for participating, pilot participants will receive public recognition and a limited
period in which to correct any violations discovered during the experimental projects, as long as
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the violations are not criminal in nature and do not present an imminent and substantial
endangerment to the public health or environment.
EPA is developing the ELP in cooperation with state agencies, which have participated in
the review and selection of participants. EPA expects the pilot phase to last approximately 12
months, during which time EPA and its public and private partners will test the key concepts and
evaluate results. Following completion of the pilots, EPA will refine the program and make its
benefits broadly available to those willing to meet its criteria.
Common Sense Initiative
Another example of a sector-based outreach initiative is the EPA-wide Common Sense
Initiative (CSI). In July 1994, EPA Administrator Carol Browner announced the CSI as her
cornerstone sector-based initiative. Six industrial sectors were selected to participate:
• Iron and steel
• Electronics and computers
• Metal plating and finishing
• Auto assembly
• Petroleum refining
• Printing.
For each of these sectors, EPA is convening a high-level team comprising industry
executives, environmental leaders, government officials, and labor and environmental justice
representatives to explore opportunities for making environmental regulation more effective and
efficient. Decisions are reached by consensus only. These teams will be looking at six key
elements affecting their sector:
• Promoting pollution prevention opportunities
• Conducting regulatory reviews
• Undertaking innovative compliance assistance and enforcement initiatives
• Simplifying and improving reporting and recordkeeping requirements
• Implementing permit streamlining opportunities
• Promoting innovative environmental technologies.
Currently, the teams are establishing pilot projects to test some concepts and ideas.
Small Business Incentive Policy
EPA's Interim Policy on Compliance Incentives for Small Business is intended to promote
environmental compliance among small businesses by providing incentives for participating in
compliance assistance programs and promptly correcting violations. The policy is one of the 25
regulatory reform initiatives announced by President Clinton. The policy establishes how EPA
expects to exercise its enforcement discretion in deciding on an appropriate enforcement response
and determining an appropriate civil penalty for violations by small businesses. For the purposes
of this policy, a small business is defined as a person, corporation, partnership, or other entity
who employs 100 or fewer individuals (on a company-wide basis).
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Under the policy, EPA will eliminate or reduce a civil penalty based on the following
criteria:
• The small business has made a good faith effort to comply with applicable
environmental requirements.
• The business was not subject to a previous enforcement action (e.g., warning letter,
NOV) for violations of that requirement in the past 5 years and has not been subject to
multiple enforcement actions for violations of environmental requirements,
• The violation does not involve criminal conduct.
• The business corrects the violation and remedies any harm associated with the violations
within 6 months of discovery.
Penalties may be mitigated based on the following guidelines:
• If a small business satisfies all of the criteria, EPA will eliminate the entire civil penalty.
• If a small business has not met all the criteria, except it needs a longer correction period,
EPA will waive up to 100 percent of the gravity component of the penalty, but may seek
the full amount of any economic benefit associated with the violations.
• If a small business has not met all the criteria, but has otherwise made a good faith
effort to comply, EPA will exercise its discretion not to file an enforcement action
seeking civil penalties or to mitigate its demand for penalties to the maximum extent
appropriate.
This policy does not apply if the violation 1) has caused actual serious harm to public
health, safety, or the environment, 2) may present an imminent and substantial endangerment to
public health or the environment, or 3) presents a significant health, safety, or environmental
threat.
Compliance Incentives for Small Communities
EPA is currently exploring the possibility of a policy to express its support for state use of
enforcement flexibility to provide compliance incentives for small communities. The preliminary
concept for such a policy would enable states and small communities to negotiate enforceable
compliance agreements and schedules that allow the community to prioritize among competing
environmental mandates. In addition, EPA would assure that states have the appropriate
discretion to waive all or part of the penalty for a small community's violations where the
community had made good faith efforts to comply and the violations-do not involve. criminal
wrongdoing. In cases where small community environmental noncompliance was being
addressed by state compliance assistance, EPA would not pursue a separate federal civil action
for penalties or additional injunctive relief.
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EPA intends that such a policy would only apply to small communities unable to satisfy
all applicable environmental mandates without state compliance assistance. Such communities
would be nonprofit governmental agencies that are owners or operators of facilities that supply
municipal services to residents. EPA does not expect the population of potential small
communities to exceed 2,500.
Other Tools
The Office of Compliance has developed numerous tools to aid in developing the
compliance assistance process. These tools can loosely be divided into two broad categories:
1) inspection guidance and inspector training programs and 2) sector and data analysis.
Inspection guidance and inspection training programs are used to direct utilization of resources
to reflect new priorities and attitudes regarding environmental protection. For example, during
fiscal years 1995/1996, the Office of Compliance will shift resources away from single media
training development and instruction and focus instead on multimedia inspection guidance and
training. This shift has been prompted by resource constraints and the understanding that
exposing inspectors to a full range of regulatory requirements affecting a given facility or
industry will reduce the redundancy built into multiple, single media inspections and will enhance
"whole-facility" solutions to compliance problems.
The second major category of enforcement tools are sector and data analyses. Data analysis
provides a basis for new planning and targeting efforts, as well as for program evaluation.
Current initiatives in improving sector and data analyses include developing sector profiles and
sector compliance strategies, re-evaluating measures of success, and improving public data
accessibility.
The sector profiles initiative involves compiling profiles of 18 major industrial sectors.
These profiles provide information regarding process descriptions, multimedia regulatory
requirements, historical enforcement data, pollutant release information, current public and private
sector initiatives, and pollution prevention opportunities. The development of sector compliance
strategies allows the Office of Compliance to assess the most efficient mix of compliance and
enforcement activities for each industrial sector. Such activities may include the appropriate
state/federal role in outreach, compliance, and inspection priorities; enforcement actions; and
targeted initiatives. The profiles acknowledge that the regulators have to better understand the
regulated community to be effective regulators, enforcers, and providers of compliance assistance.
After acquiring compliance information on a specific sector, EPA can formulate a
compliance strategy. The particular characteristics of the sector will dictate the strategy EPA
develops to begin the process of compliance assistance and, ultimately, compliance achievement.
For instance, the strategy established for the printing sector, which comprises numerous small
facilities, would differ from a strategy targeted at a computer microchip manufacturer. The
smaller facilities would be more appropriate for personal contact and focused outreach materials.
Larger, more sophisticated facilities may be more appropriate for generalized outreach efforts
(e.g., mailings, electronic bulletin boards).
The Office of Compliance has also revised measures used by EPA to evaluate the
effectiveness of enforcement and compliance assurance programs. The recommended revisions
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include changes to ensure consistency in data definitions across media programs, newly defined
programmatic impact and directional definitions, and systemic reporting methods. The office has
also developed a pilot program to promote public utilization of compliance data to foster greater
understanding and awareness of the environmental programs that affect their community.
12.3 COMPLIANCE ASSISTANCE DEVELOPMENT
Developing compliance assistance programs is a multistep process that requires significant
information about specific industry sectors and the associated individual industries. A normal
compliance assistance development process would likely include the following steps:
• Targeting the sector
• Establishing partnerships/alliances
• Identifying and targeting compliance problems, issues, and needs
• Developing and implementing a compliance strategy
• Revising the program, as necessary, based on pilots and testing.
The activities conducted under the first step, targeting the sector, go a long way toward
satisfying the requirements of the latter four steps. Targeting the sector is a process within a
process and includes the following sub-steps:
• Researching general industry profiles
• Identifying environmental problems and requirements
• Identifying EPA's enforcement priorities
• Developing an enforcement profile using data bases and information contained at the
state and local levels
• Communicating with stakeholders
• Identifying compliance assistance efforts to date.
Along these lines, EPA is conducting extensive analyses of industry sector compliance,
focusing specifically on such factors as:
• Noncompliance rates—EPA is developing tracking systems and programs to measure
the compliance rate of entire industry sectors. This compliance rate will be one of the
drivers for determining which sectors are the most in need of compliance assistance.
• Average number of inspections conducted per sector—In numerous industries,
including petroleum refining, organic chemicals, and iron and steel, inspections are
conducted at virtually all facilities annually across the media programs (i.e., not all
media programs inspect annually, but at least one program inspects each year). In other
sectors, such as dry cleaning, printing, rubber, and plastics, inspections only occur once
every 7 to 10 years.
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• Percent of inspections conducted that led to an enforcement action—Not all
inspections lead to enforcement actions. A factor to consider is the percentage of
inspections that actually result in an enforcement action. For example, 32 inspections
are conducted per every enforcement action taken in the nonmetal mining sector (or, 3%
of inspections result in an enforcement action). In contrast, only 6 inspections are
conducted per every enforcement action taken against petroleum refineries (or* 17% of
all inspections lead to an enforcement action). As the percentage increases, so does the
perceived need for compliance assistance.
• Types of pollutants discharged into the environment—The type of pollutant
discharged also plays a role in targeting the sectors for compliance assistance. Sectors
that discharge highly toxic pollutants, or that discharge large quantities of any pollutants,
are more likely to receive attention than sectors that discharge less toxic or small
quantities of wastes.
Several of these steps may be included in an activity similar to the sector notebooks
currently being prepared by the Office of Compliance and discussed in Section 12.2 of this
module.
EPA data bases and other sources of information can be used to determine the enforcement
profile of the sector. For example, using IDEA or other enforcement/compliance-related data
bases, EPA can determine the overall compliance rate for all facilities within a specific sector.
Obviously, a sector with poor compliance rates would be a prime candidate for compliance
assistance. Information maintained at the state and local levels can further confirm the results
of the data analysis. Because several of EPA's regulatory responsibilities are carried out at these
levels, state and local levels may have the majority of the information regarding compliance and
enforcement activities.
Another step is to establish partnerships/alliances with stakeholders, including the industry
itself, trade associations, environmental groups, and other interested parties, such as the public.
When forces band together, it strengthens the program and usually results in greater participation.
In the past, federal agencies have viewed some of these groups as enemies and have intentionally
excluded them from the process. Everyone is starting to understand the value of stakeholder
participation, however. In addition, when it comes to providing compliance assistance, several
of these stakeholders, such as trade associations, have already established relationships with the
sector industries and, therefore, have already established lines of communication.
EPA is currently analyzing several factors—noncompliance rates, average number of
inspections conducted per sector, percent of inspections conducted that led to an enforcement
action, and types of pollutants discharged into the environment—that should be considered when
attempting to target a sector for compliance assistance.
Another part of the process is developing and implementing compliance strategies. These
compliance strategies will include EPA's efforts to create the appropriate mix of compliance and
enforcement activities, including issues like inspection priorities, regional/state roles, and use of
enforcement actions/targeted initiatives. The mix will be based on strong analysis of the sector
profiles, national priorities, and other data sources.
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12.4 MEASURING SUCCESS OF COMPLIANCE ASSISTANCE
As noted throughout this module, EPA is now devoting significant time and resources to
compliance assistance. To truly gauge the effectiveness of its compliance assistance efforts, EPA
needs to develop a system for measuring success. Because compliance assistance is a new
concept, there is minimal existing baseline data from which to start measuring effectiveness,
especially for small businesses. To address this concern, OECA formed a workgroup in 1994
to review and revise the measures that EPA currently uses to evaluate the effectiveness of its
enforcement and compliance assurance programs. In August 1994, the workgroup released
several comprehensive recommendations:
• Implement systematic reporting of environmental and programmatic impacts
through use of the case conclusion data sheet—Develop a data sheet that should 1) be
used for consistent reporting of quantitative and qualitative results on administrative and
judicial actions, 2) pilot the data sheet in two regions, and 3) based on review of pilot
results, implement the system nationally in late 1995.
• Assure consistency in data definitions across media programs—Revise program
policies and data definitions to consistently measure accomplishments and outputs in all
program areas, placing specific emphasis on measuring facility compliance rates.
• Develop measures evaluating programmatic impacts—Adopt a new measure to
evaluate reductions in pollutant emissions or discharge loadings resulting from
compliance and enforcement activities.
• Institute use of an enforcement authority index for a better balanced profile of
Agency enforcement—Enhance measurement of enforcement activity by highlighting
both initiated and concluded actions.
• Expand scope of existing reporting measures to incorporate new Agency
directions—Incorporate multimedia, sector, place-based, and environmental justice
themes into existing reporting measures.
Several of these recommendations are currently being implemented and reviewed by staff
both within OECA and in other Agency offices. EPA personnel recognize that to accurately
gauge the success of its compliance assistance efforts, time and resources need to be allocated
to track data that has not been tracked previously. This could result in a significant time lag
before a statistically valid evaluation of the activities can be made.
12.5 NEXT STEPS
To date, EPA has made tremendous strides in its efforts to develop and implement
compliance assistance programs. The momentum provided by the reorganization and the recent
program successes must be maintained. Specifically, the Agency must take the following steps:
• Get "buy-in" from other enforcement offices and convince them of the merits of
conducting compliance assistance
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• Continue to develop sector expertise and an understanding of the regulated communities
• Continue to undertake pilot programs and test different approaches in the field
• Continue to develop, test, and implement measures of success that will provide
statistically valid data on the success of compliance assistance programs
• Develop a well-balanced approach to compliance assistance, combining it with
enforcement actions and compliance monitoring, to best protect human health and the
environment.
The Agency components of compliance assistance discussed in this module are fresh and
exciting. The personnel developing and implementing such programs are now responsible for
taking these next steps to continue the trend toward compliance assistance.
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RCRA PRACTITIONERS ENFORCEMENT WORKSHOP
13. CIVIL PENALTIES UNDER RCRA
Background Materials
&EPA
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Civil Penalties Under RCRA
13. CIVIL PENALTIES UNDER RCRA
The Resource Conservation and Recovery Act (RCRA) authorizes the use of civil penalties
to enforce the hazardous waste requirements imposed under the Act through several provisions.
Section 3008(g) of RCRA, 42 U.S.C. Section 6928(g), provides that:
Any person who violates any requirement of this subchapter shall be liable to the
United States for a civil penalty in an amount not to exceed $25,000 for each such
violation. Each day of such violation shall, for purposes of this subsection, constitute
a separate violation.
In addition, Sections 3008, 7003, and 3013 provide additional civil penalty authority.1
Section 3008(a) of RCRA authorizes the U.S. Environmental Protection Agency (EPA)
Administrator to issue an administrative order assessing a civil penalty for any violation of
Subtitle C (Hazardous Waste Management) of RCRA and provides:
In assessing such a penalty, the Administrator shall take into account the seriousness
of the violation and any good faith efforts to comply with applicable requirements.
EPA's RCRA Civil Penalty Policy (RCPP) incorporates these provisions.
13.1 RCRA CIVIL PENALTY POLICY (OSWER DIRECTIVE 9900.1A)
EPA issued the original RCRA Civil Penalty Policy on May 8, 1984. The Agency
supplemented this policy by issuing a guidance document applying the 1984 Civil Penalty Policy
to Loss of Interim Status (LOIS) cases on November 16, 1987, and revised the RCPP on October
29, 1990. The 1990 RCPP supersedes the 1984 RCPP and the LOIS guidance. The 1990 RCPP
does not apply to Subtitle I (Underground Storage Tank) cases, however, which are addressed
by a separate policy issued in November 1990.
The RCPP is intended to:
• Promote penalties sufficient to deter RCRA violations
• Eliminate economic incentives for noncompliance
• Ensure that RCRA civil penalties are fair and consistent
• Ensure that penalties are appropriate for the gravity of the offense
• Promote expeditious and continuing compliance
• Promote documentation of the basis for civil penalties.
1. Section 3008(h) provides civil penalty authority where a person fails to comply with an interim status corrective
action order (not to exceed $25,000 for each day of noncompliance). Section 7003(b) provides penalty authority
where a person fails to comply with a Section 7003 imminent hazard order (not more than $5,000 for each day of
violation). Section 3013 provides authority where a person fails to comply with a Section 3013 order requiring
monitoring, analysis, testing, or reporting (not to exceed $5,000 for each day of violation).
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One purpose of the RCPP is to increase compliance with federal hazardous waste rules by
assuring that significant monetary penalties are assessed for violations and that defendants are
deprived of the economic benefits of noncompliance. The policy institutes provisions to ensure
that a penalty is tied to the length of noncompliance by requiring multiday penalties for most
major, continuing violations. The recovery of profits gained as a proximate result of unlawful
activity is authorized in certain circumstances.2 In addition, the RCPP imposes documentation
requirements that must be followed, in accordance with the August 9, 1990, memorandum from
James Strock, entitled, Documenting Penalty Calculations and Justifications in EPA Enforcement
Actions.
The RCPP is also intended to enhance the deterrent effect of RCRA by increasing the
amount of penalties obtained for RCRA violations. EPA's RCRA Implementation Study, issued
in July 1990, determined that the sanctions imposed under RCRA program had not created a
sufficiently strong deterrent effect and recommended the Agency seek higher penalties in
administrative and judicial cases. EPA's administrative practices, including those under RCRA,
have previously been the subject of critical reports by EPA's Office of Inspector General.
13.1.1 Applicability of the RCRA Civil Penalty Policy
The RCPP is to be used to calculate penalties:
• Sought in all RCRA administrative complaints (and subsequent litigation)
• Accepted in settlement of both administrative and judicial enforcement actions.
The RCPP applies to all cases filed after its effective date (10/29/90) and, to "the maximum
extent practicable," to the settlement of cases instituted but not resolved before the effective date
of the policy. As previously noted, the RCPP does not apply to Subtitle I cases.
The RCPP does not address whether assessment of a civil penalty is the appropriate
enforcement response to a particular violation. Rather, it focuses on determining the proper civil
penalty amount once a decision has been made to assess a civil penalty. Guidance on when to
assess administrative penalties is set forth in the RCRA Enforcement Response Policy (12/21/87),
which provides a general framework for identifying violations and violators of concern and
guidance on selecting the appropriate enforcement action in response to categories of RCRA
violations.
The policy does not limit the amounts that can be sought in civil judicial enforcement
actions under RCRA Section 3008. In such cases, the government will, in its discretion, continue
to file complaints requesting up to the statutory maximum civil penalty amount and to litigate
for the maximum amount justifiable given the facts of the case.
2. The recovery of profits is appropriate where the profits result from unlawful activity. However, it is not
appropriate where such profits are earned as a result of lawful activity or where they are attributable to delayed or
avoided costs already accounted for in the economic benefit calculation.
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A number of administrative decisions under Section 3008(a) have held that the RCPP is not
a regulation and is not binding on the Presiding Officer, the Administrator, or his/her
delegate, the Judicial Officer (see In the Matter of Elwin G. Smith, Cyclops Corporation,
RCRA Appeal No. 86-6 (August 14, 1990); In re A.Y. McDonald Industries, Inc., RCRA
(3008) Appeal No. 86-2 (July 23, 1987); In the Matter ofE. Smith Division, Cyclops Corp.,
supra; and In re Sandoz, Inc., RCRA (3008) Appeal No. 85-7 (February 27, 1987)).
13.1.2 Key Provisions of the RCPP
To determine the penalty amount, the RCPP considers the gravity of the violation, the time
period over which the violation occurred, adjustments, and any economic benefit to the violator.
Specifically, the policy provides that the penalty amount equals:
Penalty = gravity component + multiday component +/- adjustments + economic benefit
where:
• Gravity component—This component addresses the seriousness of the violation. Two
factors are used to determine the gravity-based penalty component: 1) potential for harm
and 2) extent of deviation from statutory or regulatory requirement.
• Multiday component—For days 2 through 180 of the multiday violations, multiday
penalties are mandatory. After day 180, the region can revert to single day penalties,
although it retains the option to continue multiday penalties.
• Adjustments—A proposed penalty can be adjusted to reflect such factors as good faith
efforts to comply (or lack of good faith), degree of willingness or negligence, history of
noncompliance (upward only), ability to pay (downward only), environmental credit
projects (downward only), litigation risks, and other miscellaneous factors.
• Economic benefit—It is very important to recapture all economic benefits obtained by
violating the law. The Agency generally uses the BEN computer program to estimate
the economic benefit received by the defendant from its noncompliance. Other methods
may be used in appropriate circumstances.
13.1.3 Documentation
Documentation for Penalty Sought in Administrative Complaint Litigation
To support the penalty proposed in an administrative complaint, enforcement personnel must
include in the case file an explanation of how the proposed penalty amount was calculated. In
addition, the file should document or reference all factual information on which EPA has relied
or will need to rely to support the penalty amount sought in the complaint. In general, only final
documents should be included in the record file. Such documentation should be in the record
file at the time the complaint is issued and should be supplemented to reflect adjustments when
adjustments are necessary.
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Enforcement personnel must be prepared to present detailed information reflecting the
specific factors weighed in calculating the penalty proposed in the complaint at the pre-hearing
conference or evidentiary hearing. For example, evidence of specific instances where the
violation actually did, could have, or still might result in harm could be presented to the trier of
fact to illustrate the "potential for harm" factor of the penalty. Experience also suggests that the
Agency may be called upon, before the hearing, to present to the trier of fact and the respondent
the penalty computation worksheet supporting the proposed penalty amount sought in the
complaint.
Normally the record supporting the penalty amount specified in the complaint should
include a penalty computation worksheet that explains the potential for harm, extent of deviation
from statutory or regulatory requirements, economic benefit of non-compliance, and any
adjustment factors applied (e.g., good faith efforts to comply). The record should also include
any inspection reports and other documents relating to the penalty calculation.
Documentation of Penalty Settlement Amount
Preparation of a penalty calculation worksheet for purposes of establishing the Agency's
settlement position on penalty amount may not be feasible prior to the time that negotiations with
the violator commence, because the Agency may not be aware of all relevant factors bearing on
the case. Once the violator has presented the region with its best arguments relative to penalty
mitigation, the region may, at its discretion, complete a penalty calculation worksheet to establish
its initial "bottom line" settlement position. At a minimum, prior to final approval of any
settlement, whether administrative or judicial, enforcement personnel must complete a final
worksheet and narrative explanation, which provides the rationale for the final settlement amount,
to be included in the case file for internal management use and oversight purposes only.
Enforcement personnel may, in arriving at a penalty settlement amount, deviate significantly from
the penalty amount sought in an administrative complaint, provided such discretion is exercised
in accordance with the provisions of the RCPP.
13.2 USE OF THE RCPP IN LITIGATION
The RCPP has distinct applications in administrative and civil litigation.
13.2.1 Administrative Litigation
Under 40 CFR 22,13, the government must plead a specific penalty amount in an
administrative complaint. Complaints must not only indicate specific penalty amounts, but must
explain the reasoning behind the proposed penalty. Failure to do so could result in dismissal of
an administrative complaint. Once the Presiding Officer determines that a violation has occurred,
he/she must determine the amount of the civil penalty in accordance with the criteria set forth
under RCRA relating to the proper amount of a civil penalty and must consider civil penalty
guidelines issued pursuant to RCRA 40 CFR 22.27(b).
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13.2.2 Civil Litigation
In contrast to administrative litigation, no specific penalty amount should be requested in
a civil complaint. Rather, the complaint should request the statutory maximum. This provides
maximum latitude to establish the penalty amount at trial or to enter settlement negotiations. The
RCPP is important because it should be used in developing a proposed penalty to be used for
settlement purposes, which must be included in the referral to the Department of Justice. The
calculation of the proposed penalty should be considered work product and should not be
disclosed to the defendant as part of discovery, because it would likely put a ceiling on any civil
penalty that could be obtained in court. Occasionally, disclosure is made part of the settlement
negotiations, but a confidentiality agreement with the defendant should be obtained before doing
so. In addition, although a court is not required to follow the elements of the RCPP is setting
a penalty, these factors are clearly relevant and should be used as a framework for arguing a
penalty case. It is important to remember, however, that the RCPP is not binding on the court,
which retains discretion to impose what it considers to be an appropriate penalty (United States
v. EWC, Inc., 710 F. Supp. 1172, 1142-1145 [N.D. Ind. 1989]).
13.3 HOW THE RCPP WORKS
The following discussion addresses each of the primary factors of the RCPP, including the
gravity-based, multiday, and economic benefit penalty components, as well as adjustments to civil
penalties.
13.3.1 Determination of Gravity-Based Penalty Component
As mentioned previously, the gravity-based component is a measure of the seriousness of
a violation. Two factors are considered in determining the gravity-based penalty component:
• Potential for harm
• Extent of deviation from a statutory or regulatory requirement.
These factors form the, axes of the gravity-based penalty assessment matrix, presented in
Exhibit 13-1. The matrix has nine cells, each containing a penalty range. The specific cell is
chosen after determining which category is appropriate for each factor.
Exhibit 13-1. Gravity-Based Penalty Assessment Matrix
Potential
For. Harm
Extent of Deviation
Major
Moderate
Minor
Major
$25,000 to 20,000
$19,999 to 15,000
$14,999 to 11,000
Moderate
$10,999 to 8,000
$7,999 to 5,000
$4,999 to 3,000
Minor
$2,999 to 1,500
$1,499 to 500
$499 to 100
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Potential for Harm
Enforcement personnel should evaluate whether the potential for harm is major, moderate,
or minor in a particular situation. The degree of potential harm represented by each category is
defined as:
• Major
1. The violation poses or may pose a substantial risk of exposure of humans or other
environmental receptors to hazardous waste or constituents; and/or
2. The actions have or may have a substantial adverse effect on statutory or regulatory
purposes or procedures for implementing the RCRA program.
• Moderate
1. The violation poses or may pose a significant risk of exposure of humans or other
environmental receptors to hazardous waste or constituents; and/or
2. The actions have or may have a significant adverse effect on statutory or regulatory
purposes or procedures for implementing the RCRA program.
• Minor
1. The violation poses or may pose a relatively low risk of exposure of humans of other
environmental receptors to hazardous waste or constituents; and/or
2. The actions have or may have a small adverse effect on statutory or regulatory
purposes or procedures for implementing the RCRA program.
Actual harm or potential for harm should be assessed based on the risk of actual or potential
human or environmental exposure to hazardous waste or hazardous constituents posed by non-
compliance and the adverse effect of
noncompliance on the RCRA regulatory
program. Factors to consider in
assessing the risk of actual or potential
harm include actual releases; waste
mismanagement; inadequate detection or
inspection procedures; the quantity and
toxicity of waste involved; and the
existence, size, and proximity of
receptor populations.3
The law is clear that actual harm need not be proven to
justify a civil penalty. See, for example, In the Matter of
Wheeling-Pittsburgh Steel Corp., Docket No. RCRA (3008)
III-070 at 13. In the Matter of A.Y. McDonald Industries,
Inc., Appeal No. RCRA (3008) 86-2 (Final Decision July 23,
1987) (refusing to reduce penalty because no actual harm
resulted, CJO stated: "McDonald should not be rewarded for
its complete disregard of the RCRA program simply because
test results this far fail to show groundwater contamination").
3. In considering the risk of exposure, emphasis should be placed on the potential for harm posed, since a violator
should not be rewarded with lower penalties simply because the violation happened not to have resulted in actual
harm.
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Actual harm was shown in United States v. EWC, 710 F. Supp. 1172 (N.D. Ind. 1989) aff'd
917 E2d 327 (7th Cir. 1990). Defendants had an inadequate ground water monitoring system,
despite receiving several NOVs. The Agency relied on the presence of low levels of ground
water contamination to argue for imposition of a large penalty for violations of 40 CFR Section
265. Such contamination demonstrated the seriousness of the inadequate ground water
monitoring system, because the purpose of such a system was to detect contamination at an early
stage when corrective measures could have been implemented easily. Rather, the defendant's
inadequate system put the aquifer at risk and made it impossible to know exactly the extent of
contamination.
Assessing the adverse effects of noncompliance on the RCRA regulatory program focuses
on examining the extent to which violations undermine the statutory or regulatory purposes and
structure of RCRA. It is premised on the notion that even violations that do not pose an
immediate risk or threat of risk jeopardize the integrity of the regulatory program. An example
is failure to comply with financial assurance requirements, which may result in a site becoming
an abandoned waste site. Examples of violations that threaten the regulatory program include:
• Failure to notify as a generator or transporter of hazardous waste and/or owner/operator
of a hazardous waste facility per Section 3010
• Failure to submit a timely/adequate Part B application
• Failure to respond to a formal information request
• Operating without a permit or interim status
• Failure to prepare or maintain a manifest
• Failure to install or conduct adequate ground water monitoring.
In assessing gravity-based penalties under the 1990 RCPP where "harm to the RCRA regulatory program" is
a key consideration, care should be taken to also analyze the potential harm to health and the environment from
the violation. Regardless of which impact is considered more severe, the litigation team should always be
prepared to demonstrate not only how the violations affect an important RCRA program, but also why the
program itself is important. Explaining the health and environmental risks the program is designed to address,
and the likelihood of those risks occurring are effective ways to accomplish this result. Citing to the relevant
rule preamble and supporting documentation, and presenting expert testimony from EPA staff responsible for.
implementing the program are both appropriate litigation techniques.
Extent of Deviation
Extent of deviation from a requirement is the second factor considered in determining the
gravity-based penalty. Extent of deviation relates to the extent to which the violation renders
inoperative the requirement violated. In determining the extent of the deviation, the following
categories should be used:
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• Major—The violator deviates from requirements of the regulation or statute to such an
extent that most (or important aspects) of the requirements are not met, resulting in
substantial noncompliance.
• Moderate—The violator significantly deviates from the requirements of the regulation
or statute, but some of the requirements are implemented as intended.
• Minor—The violator deviates somewhat from the regulatory or statutory requirements,
but most (or all important aspects) of the requirements are met.
Once within a set range for a violation
as set out in the gravity-based penalty
assessment matrix, selection of the exact
penalty amount is left to the discretion of the
enforcement personnel, who may consider
other factors, such as the seriousness of the
violation, remediation efforts and the extent of
cooperation, the size and sophistication of the
violator, the number of days of violation, and
other relevant matters.
Note that annual EPA policy (e.g., RCRA Implementation Plan) may be relevant in
assessing the gravity of specific violations, as well as in selecting the exact penalty amount.
13.3.2 Multiple and Multiday Component
Multiple Violations
Under the RCPP, a separate penalty should be sought in a complaint and obtained in
settlement or litigation for each separate violation that results from an independent act (or failure
to act) by the violator and is substantially distinguishable from any other charge in the complaint
for which a penalty is to be assessed. A given charge is independent of, and substantially
distinguishable from, any other charge when it requires an element of proof not needed by the
others. Penalties for multiple violations also should be sought in litigation or obtained in
settlement where one company has violated the same requirement in substantially different
locations. Penalties for multiple violations are appropriate when a company violates the same
requirement on separate occasions not cognizable as multiday violations (e.g., where a facility
fails for a year to take required quarterly ground water monitoring samples). This is significant
because for multiple violations, each separate violation should assessed independently and the
amounts totaled.
Multiday Violations
Where a violation continues beyond 1 day, the multiday component of the penalty should
be calculated as follows:
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For example, a major deviation was found where a
respondent kept a percolation pond in operation for
240 days without a permit and, after it was required
to close, ... did not certify compliance with ground
water monitoring or financial responsibility
requirements ... and ... closure plans were inadequate.
In the Matter of Grumman St. Augustine Corp.,
Docket No. RCRA 87-18-R (Initial Decision
May 10, 1989).
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• Determine the gravity based designation for the violation (e.g., major-major, moderate-
minor, minor-minor)
• Determine whether multiday penalties are mandatory, presumed, or discretionary
under the RCPP:
- Mandatory—For days 2 through 180 of all violations with the gravity-based
designations major-major, major-moderate, and moderate-major (exception for
"highly unusual cases" with prior headquarters consultation)
- Presumed—For days 2 through 180 of all violations with the gravity-based
designations major-minor, moderate-moderate, minor-major. Such a presumption
may be overcome for 1 or more days by documenting case-specific facts that
mitigate against the imposition of a multiday penalty in the file.
- Discretionary—For all days after the first for violations with gravity-based
designations minor-moderate, moderate-minor, or minor-minor. Such penalties
should be sought unless the documented facts of the case support not imposing
multiday penalties. In these situations, a decision to impose or not impose multiday
penalties should be documented.
• Locate the cell in the multiday matrix (Exhibit 13-2) that corresponds to the cell selected
for the gravity-based penalty matrix. Multiply the dollar amount selected from the
appropriate cell in the multiday matrix by the number of days of the violation, excluding
the first day of violation. (Note: the first day of the violation is calculated based on the
gravity-based matrix; subsequent days of violation are calculated based on the
multiday matrix).
Exhibit 13-2. Multiday Penalty Matrix
Potential
For Harm
Extent of Deviation
Major
Moderate
Minor
Major
$5,000 to 1,000
$4,000 to 750
$3,000 to 550
Moderate
$2*200 to 400
$1,600 to 250
$1,000 to 150
Minor
$600 to 100
$300 to 100
$100
Selections of a dollar figure from the range of penalty amounts can be made at the region's
discretion based on an assessment of the RCPP's broad goals and relevant case specific factors,
including:
• Goal of ensuring fair and consistent penalties that reflect the gravity of violations
• Goal of promoting prompt and continuing compliance
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• Goal of deterring future noncompliance
• Seriousness of the violation relative to other violations falling within the same matrix
cell
• Efforts at remediation or the promptness and degree of cooperation evidenced by the
facility (to the extent not otherwise accounted for in the proposed penalty or settlement
amount)
• Size and sophistication of the violator, as well as the total number of days of violation
• Other relevant considerations.
Generally, the failure to
correct a violation constitutes a
continuing violation. See United
States v. Trident Seafoods Corp.,
No. C92-1025D (W.D. Wash.,
December 13, 1993) held that the
failure to comply with the notice
requirements-imposed for asbestos
removal under the Clean Air Act is a continuing violation, ending only when renovations were
complete or EPA had actual notice. In In the Matter of Dr. Marshall C Sasser, Docket No. 404-
89-102 (Initial Decision July 30, 1991), the respondent was held to have committed a continuing
violation of Clean Water Act by filling wetland and failing to correct the violation. [Note: Also,
see United States v. Telluride Co., 1995 U.S. Dist. Lexis 6303 (D. Colo., May 2, 1995), which
held that the filling of wetlands does not constitute a continuing violation for purposes of
extending the applicable statute of limitations, and In re Cypress Aviation, Inc., RCRA (3008)
Appeal No. 91-6 (Order Dismissing Notice of Appeal; January 8, 1992), which held illegal land
disposal of land disposal restrictions waste warranted single day penalties only.]
In some cases, a single violation can cause the violations of numerous regulations. The
most obvious example is when there is a mistaken belief that the regulated entity does not have
to notify EPA of hazardous waste activity that requires a permit or interim status. In these cases,
the regulated entity will most likely violate all of the provisions of 40 CFR Part 264 or 265.
Alleging each violation of each regulation will result in an excessively high penalty. In such
cases, discretion exists not to seek penalties for all violations as long as the penalty obtained is
sufficient to meet the goals of the RCPP.
In addition, the RCPP does not preclude the assessment of penalties of up to $25,000 for
each day after the first day of violation where significant harm has occurred or is threatened.4
On January 28, 1994, the United States obtained a $4.2 million
penalty judgment against Ekco Housewares, Inc., based on Ekco's
failure to obtain financial assurance for closure and post-closure
and liability coverage. The United States cited violations of a 1987
partial consent agreement and order and RCRA rules. The court
assessed $l,000/day multiday penalties for 4,606 days of violation.
4. Multiday penalties were rarely proposed under the 1984 penalty policy. Therefore, comparing current cases that
may warrant a multiday penalty with earlier cases that have similar factual settings may not be appropriate.
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13.3.3 Economic Benefit
The Agency's Civil Penalty Policy and RCPP mandate the recapture of any significant
economic benefit of noncompliance that accrues to a violator. Under the RCPP, an "economic
benefit" component should be calculated and added to the gravity-based penalty component when
a violation results in "significant" economic benefit to the violator.
Economic benefit need not be calculated
where it appears that the amount of the
component is likely to be less than $2,500 for
all violations alleged in the complaint.
However, this decision should he documented
on the Penalty Computation Worksheet.
With the exception of the following four
situations, the Agency generally will not settle
cases for an amount less than the economic
benefit of noncompliance:
• The economic benefit component consists of an insignificant amount (i.e., less than
$2,500).
• Compelling public concerns would not be served by taking a case to trial.
• It is unlikely, based on the facts of the particular case as a whole, that EPA will be able
to recover the economic benefit in litigation.
• The company has documented an inability to pay the total proposed penalty.
If a case is settled for less than the economic benefit component, a justification must be included
on the Penalty Computation Worksheet.
Types of Economic Benefits
Compliance/enforcement personnel should examine two types of economic benefit from
noncompliance in determining the economic benefit component:
• Benefit from delayed costs
• Benefit from avoided costs.
Delayed costs are expenditures deferred
by the violator's failure to comply with the
requirements. The violator eventually will
have to spend the money in order to achieve
compliance.
Examples of regulatory areas for which violations
likely are to present significant economic benefits:
• Ground water monitoring
• Financial requirements
• Closure/post-closure
• Surface impoundment retrofitting
• Improper land disposal of restricted waste
• Cleanup of discharges
• Part B submittals
• Minimum technology requirements.
Examples of violations that result in savings from
delayed costs are:
• Failure to timely install ground water monitoring
equipment
• Failure to timely submit a Part B permit
application
• Failure to timely develop a waste analysis plan.
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The economic benefit for delayed costs consists of the amount of interest on the unspent
money that reasonably could have been earned by the violator during noncompliance. For
example, deferring a $100,000 project for 3 years will result in interest savings of approximately
$65,000. Such benefit may also be viewed as the amount a company saved by not borrowing
funds to achieve compliance.
imples of violations that result in savings from avoided costs are:
Failure to perform annual and semi-annual ground water monitoring
sampling and analysis
Failure to perform waste analysis before adding waste to tanks, waste
piles, and incinerators
Failure to install secondary containment around a tank, where such a
containment is never installed because the violator chooses closure rather
than correction and continued operation.
leasing monitoring equipment. For avoided costs, the economic benefit equals the cost of
complying with the requirements, adjusted to reflect anticipated rate of return and income tax
effects on the company.
If noncompliance has continued for more than a year, compliance/enforcement personnel
should calculate the economic benefit of both the delayed and avoided costs for each year.
Use of the BEN Model to Calculate Economic Benefit
Economic benefit is calculated using the BEN computer model. This model applies
standards values, sound financial theory, and computational aid in calculating economic benefit.
It is useful when preparing for negotiations but should not be used during litigation (i.e., an
expert should be retained to prepare and document EPA's claim).
The model can perform a calculation of economic benefit based on delayed/avoided costs
with as few as only seven data inputs (See inputs 1 through 7 in Exhibit 13-3). The remainder
of the data inputs consists of optional data items and standard values already contained in the
program. Exhibit 13-3 presents a list and short explanation of each input.
The case team supplies
key model inputs, including
the costs that were
presumably not incurred by
the violator. It is often very
difficult to obtain meaningful
estimates of these costs or to
counter objections raised by
the defendants. The more certain enforcement staff can be of these costs, the more reliable the
output. The case development team should always make sure the result appears reasonable and,
if in doubt, obtain the services of an expert.
Avoided costs are |~T
expenditures that are
nullified by the violator's .
failure to comply; these
costs will never be *
incurred. Avoided costs
include the usual operating
and maintenance costs,
including any annual
periodic costs such as
Some of the assumptions used in the BEN model have been attacked for
the appropriateness of the default discount rate. This rate represents the
interest savings that accrue to a company and can seem quite high to thfc
financially unsophisticated user. While one should be aware of potential
challenges, a different value should not be negotiated without consulting
an expert.
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Exhibit 13-3. BEN Model Inputs
1. Case Name—Self explanatory.
2. Initial Capital Investment*—This is essentially a depreciable investment, such as the initial cost of
equipment.
3. One-Time Nondepreciable Expenditure*—This is an expense that will only be incurred once and does
not involve capital investments. It may or may not be tax deductible, but it is not depreciable. Some
examples are reporting requirements, purchase of land, or permit application costs and fees.
4., Annual Operation and Maintenance*—This expense category is for routine annual expenses, such as the
costs of operating equipment, cost of leasing equipment, or cost of annual insurance premiums.
5. First Month of Noncompliance**—Self explanatory.
6. Compliance Date**—This may be in the future. The key is to make a reasonable estimate. (For TSD
facilities, this date could be the date on which the facility certifies closure rather than the date on which
compliance is achieved).
7. Penalty Payment Date**—This may be in the future. Enforcement personnel should make a reasonable
estimate for date of payment.
8. Useful Life of Equipmentn—The model accounts for the fact that the equipment purchased in input 2 has
a useful life of limited duration. The model assumes it will last 15 years, then it must be replaced;
however, the model is being adjusted to address this matter.
9. Marginal Income Tax Raten—This is the rate at which the last dollar of earnings was taxed. It almost
always will be the highest tax rate, as most businesses meet the maximum rate quickly.
10. Annual Inflation Raten—Self explanatory.
11. Discount Raten—This is the rate of return the violator expects to obtain on its investment. The money
needed for pollution control was invested in something else, and the rate of return is assumed to be the
discount rate.
12. Amount of Low Interest Financingn—This is the amount of subsidized financing for pollution control
equipment. This is almost always zero.
* Required if Applicable
** Required Input
+ Standard Values Available
There are instances in which the BEN
methodology either cannot compute or will
fail to capture the actual economic benefit of
noncompliance. In these instances, it will be
appropriate for the Agency to include in its
penalty analysis a calculation of economic
benefits in a manner other than those provided
for in the BEN methodology. Thus, care
must be taken to ensure that any calculation
of profits included in an alternative economic
benefit component of the penalty calculation
does not include profits attributable to lawful
operations of the facility or delayed or avoided costs already accounted for in the BEN
calculation.
Enforcement personnel should have a copy of the revised BEN User's Manual (May 1987).
The manual is designed to aid enforcement personnel with procedures for entering data in BEN
and to explain the program's results. BEN supersedes previous methodologies used to calculate
the economic benefit for civil penalties.
13-13 September 1995
The issue of whether the cost of improper disposal of
waste should be considered in calculating economic
benefit has proven problematic. See, In the Matter of
ROI Development Corp., Docket No. RCRA (3008)
VIII-90-12 (Initial Decision March 31, 1994), in
which the holding calculation was flawed because
disposal costs were hot considered and In re
Burlington Northern Railroad Co., CAA Appeal No.
93-3 (Final Decision and Order Feb. 15, 1994), which
struck language crediting disposal costs towards
economic benefit, but decided the case on other
grounds.
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Economic benefit is not profit-driven. If a company lost money, this does not mean it
realized no benefit. It means the loss would have been greater if the company had spent the
needed funds. Case development staff must assume that competitors did spend the money to
comply and, therefore, are harmed unless EPA recaptures this benefit. Profitability may have an
impact on a violator's ability to pay, but should not be considered when determining economic
benefit.
13.3.4 Adjustments
The EPA civil penalty policy and RCPP set out several other adjustment factors to consider,
including:
• Good faith efforts to comply/lack of good faith
• Degree of willfulness and/or negligence
• History of noncompliance
• Ability to pay
• Other unique factors
• Environmental projects undertaken by the respondent.
The adjustment factors can increase or decrease or have no effect on the penalty amount
obtained from the violator. Adjustments should generally be applied to the sum of the
gravity-based and multiday components of the penalty for a given violation. Note, however, that
after all adjustment factors have been applied, the resulting penalty shall not exceed the statutory
maximum of $25,000 per day of violation. All supportable upward adjustments of the penalty
amount of which EPA is aware ordinarily should be made prior to issuance of the complaint,
while downward adjustments (with the exception of those reflecting good faith efforts to comply)
should generally not be made until after the complaint has been issued, at which time the burden
of persuasion that downward adjustment is proper should be placed on respondent. The
following sections discuss each of these adjustment factors.
Good Faith Efforts to Comply/Lack of Good Faith (upward or downward adjustment)
Both Section 3008(a) of RCRA and the RCPP provide that evidence of good faith efforts
to comply may adjust the penalty downward. Examples of good faith efforts are:
• Reporting noncompliance before EPA discovers the violation
• Remedying noncompliance prior to EPA detection
• Relying in good faith on written statements by EPA or the State.
With reference to the last point, it is important to remember that absent unusual
circumstances, reliance on misstatements by government employees of regulatory requirements
is not a defense to liability (see Heckler v. Community Health Services, 467 U.S. 51, 65 (1984);
United States v. Environmental Waste Control, 710 F. Supp. 1172 (N.D. Ind. 1989) ajf'd 917
F.2d 327 (7th Cir. 1990)). It can be a reason, however, for reducing the penalty based on good
faith efforts to comply. In the Matter of Landfill, Inc., RCRA (3308) Appeal No. 86-6 (Final
Decision November 30, 1990), EPA alleged improper placement of ground water monitoring
wells. The respondent argued estoppel because the location of the wells had been chosen by the
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state. Although the CJO rejected the defense, it imposed only a nominal penalty of $250 because
of the State action. In In the Matter of Union Oil Company of California, Docket No. RCRA-09-
0223 (Initial Decision January 14, 1985), "[T]he environmental problems arose in this case
because of the mistaken or erroneous action by the EPA and the State, and appears to have been
resolved promptly once the mistake or error was corrected. Accordingly, it is concluded that no
penalty should be assessed."
Examples of behavior that do not constitute good faith are efforts to correct the violation
only because of EPA pressure (e.g., In the Matter of American Ecological Research Recycle
Corp., Docket No. RCRA (3008) VHI-82-4 at 33 (July 1, 1984)). Furthermore, a lack of
diligence in learning the regulatory requirements cannot be excused by later good faith efforts
to correct the violation (e.g., In the Matter of Federal Hoffman, Inc., Docket No. RCRA (3308)
V-W-87-R-001 at 21 (Aug. 12, 1987)).
Failure of EPA or the state agency to
make clear to the defendant the need to
comply with the law does not create a good
faith factor. In Public Interest Research
Group of New Jersey, Inc. v. Powell Duffryn
Terminals, Inc.., 913 F.2d 64 (3rd Cir. 1990),
the Court of Appeals reversed the District
Court's reduction of a penalty based on "good
faith." The District Court had reasoned that
if EPA or the New Jersey Department of
Environmental Protection had brought an enforcement action in a timely manner, violations
would have ceased years earlier. The Court of Appeals held that "mere failure by governmental
agencies to prosecute an NPDES permit holder does not allow a court to reduce a penalty."
Degree of Willfulness and/or Negligence (upward or downward adjustment)
In some .cases, instances of heightened culpability may not meet the criteria for criminal
action (i.e., the acts do not constitute "knowing" violations), but do warrant some upward
adjustment of a penalty for willfulness and/or negligence. Conversely, although RCRA is a strict
liability statute, instances of penalty mitigation may be justified based on the lack of willfulness
and/or negligence. In assessing the degree of willfulness and/or negligence, the following factors
should be considered:
• How much control the violator had over the events constituting the violation
• Foreseeability of the events constituting the violation
• Whether the violator took reasonable precautions against the events constituting the
violation
• Whether the violator knew or should have known of the hazards associated with the
conduct
13-15 September 1995
In In the Matter of Oakmark Industries, Docket No.
RCRA (3008) 85t 10-09 (Initial Decision January 6,
1987), the respondent had a policy of requiring a
chemist to inspect partially filled drums prior to
disposal. Although the respondent's violation resulted
from its failure to follow its own policy, the
Administrative Law Judge reduced the proposed
penalty by 25 percent, partially in recognition of the
respondent's compliance program.
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• Whether the violator knew or should have known of the legal requirement that was
violated (enhance penalty only)
• Other appropriate factors.
History of Noncompliance (upward adjustment only)
Previous violations of RCRA or state hazardous waste law indicate that the party was not
deterred by the previous enforcement action and normally justifies upward adjustment of the
penalty (unless the current or previous violation was beyond the control of the violator).
Enforcement personnel should consider the following factors, among others:
• Similarity of the previous violation
• How recent the previous violation occurred
• Number of previous violations
• Violator's response to previous violation(s) in regard to correction of problem.
Ability to Pay (downward adjustment only)
EPA generally will not assess penalties that are clearly beyond the means of the violator;
however, any adjustment depends on the individual facts of the case. The burden to demonstrate
inability to pay rests on the respondent, as it does with any mitigating circumstances. Thus, a
company's inability to pay usually will be considered at the settlement stage and then only if the
respondent raises the issue. If the respondent fails to fully provide sufficient information, then
compliance/enforcement personnel should disregard this factor in adjusting the penalty.
When EPA determines that a
violator cannot afford the penalty
prescribed by this policy or that
payment of all or a portion of the
penalty will preclude the violator
from achieving compliance or
from carrying out remedial
measures (e.g., payment of penalty
would preclude proper closure/
post-closure), the following
options should be considered in
the order presented:
• An installment payment plan with interest
• A delayed payment schedule with interest. Such a schedule might even be contingent
upon an increase in sales or some other indicator of improved business. (Note: This
option may be less desirable because it reduces the deterrent effect of any penalty and
imposes administrative burdens on the government.)
• Straight penalty reductions as a last recourse.
Sources Available to the Regions in Determining Ability to Pay
• Agency's Guidance on Determining a Violator's Ability to Pay
a Civil Penalty, December 16, 1986
• National Enforcement Investigations Center (for publicly held
corporations)
• The Agency's ABEL computer model (designed primarily for
privately held corporations, but may support other business
forms or be useful with other sources, e.g., the Superfund
Financial Assessment System)
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When including a delayed payment schedule in a consent decree, the penalty should be due upon
signing, with payment deferred. This protects the claim in case of a declaration of bankruptcy.
Environmental Projects Undertaken by the Respondent (downward adjustment only)
EPA may consider adjusting the penalty amount downward in return for an agreement by
the violator to undertake an appropriate environmentally beneficial project. Environmentally
beneficial mitigation projects serve as an incentive to settlement and are allowed only in
prelitigation agreements (prior to the actual hearing), except in extraordinary circumstances. Such
projects are evaluated on a case-by-case basis and must satisfy all relevant criteria. Such criteria
are set out in the RCPP and the Interim Revised Supplemental Environmental Project (SEP)
Policy (May 3, 1995). The interim revised SEP policy supersedes the February 12, 1991, Policy
on the Use of Supplemental Environmental Projects in EPA Settlements. The revised policy
applies to settlements of all civil judicial and administrative actions filed after May 8, 1995, and
to pending cases in which, the government has not reached agreement in principle with the
alleged violator on the specific terms of a SEP. The revised SEP policy is discussed in the
New and Upcoming RCRA Developments module.
The RCPP identifies criteria for environmental projects, as well as categories of acceptable
and unacceptable projects. The following list highlights the RCPP criteria;
• Benefit Beyond Full Compliance—The project must be conducted in addition to all
statutory and regulatory compliance obligations and not be used for penalty mitigation
in any other enforcement action. The project may not be part of the company's normal
business practice or a project the company was already planning to implement.
• Penalty Reductions Reflect Actual Costs—With consideration of tax benefits, the
actual cost of the project to the respondent shall equal or exceed the value of the
mitigation (see Guidance on Calculating After Tax Net Present Value of Alternative
Payments, Oct: 28, 1986, General Enforcement Policy Compendium, GM-51, or the
Office of Enforcement Policy).
• Good Faith Commitment—The activity must demonstrate a good faith commitment to
statutory compliance and environmental improvement.
• Deterrent Effect—Mitigation must not detract significantly from the general deterrent
effect of the settlement. The government should seek penalties in conjunction with
mitigation activities that deter both the specific violator and the entire regulated
community. Accordingly, every settlement should include a substantial monetary penalty
component.
• Enforceability of Consent Decrees—Judicially enforceable consent decrees must meet
the statutory and public interest criteria for consent decrees and cannot contain
provisions that would be beyond' the power of the court to order under the particular
statute violated.
• Minimum EPA Oversight—The activity or project must require little EPA oversight.
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• Acknowledgement of Settlement—Any settlement that includes a mitigation project
shall require that any public statement by the violator regarding the environmental or
general public benefits of the project must note that funding for the project is in partial
settlement of an enforcement case brought by EPA.
• Nexus to Violation—Qualifying activities must provide a discemable response to the
perceptible risk or harm caused by the violations.
Under the RCPP, the categories of acceptable SEPs are as follows:
• Pollution Prevention Projects, which reduce or prevent the creation of pollution by use
reduction or by application of closed loop processes.
• Pollution Reduction Projects, which extend substantially beyond compliance with
discharge limitation to further reduce the amount of pollution that would otherwise be
discharged into the environment. They can include additional pollution controls or
certain types of recycling.
• Projects Remediating Adverse Public Health or Environmental Consequences, which
not only repair the damage done to the environment because of the violation but also
enhance the environment in the vicinity of the violating facility.
• Environmental Auditing Projects, which must extend beyond that which constitutes
general good business practices.
• Enforcement Related Environmental Public Awareness Projects, which are
publications, broadcasts, or seminars that underscore for the regulated community the
importance of complying with environmental laws or disseminate technical information
about the means of complying with environmental laws. Any project of this type should
be carefully examined to make sure that it meets SEP criteria.
Under the RCPP, examples of projects that clearly do not meet SEP criteria are general
educational or environmental awareness raising projects, contribution to environmental research,
or projects that are unrelated to enforcement actions but that benefit the community, such as
charitable contributions. The interim revised SEP policy specifies seven categories of acceptable
SEPs.
Any acceptable SEP must have a nexus or relationship to the violation. A vertical nexus
exists if the SEP concerns the same facility in the same medium. A horizontal nexus exists if
it involves a different facility or medium. The latter type of relationship is less readily accepted,
however, and requires OE approval.
Note that the use of SEPs imposes some degree of burden on EPA as a result of the need
to monitor compliance. Therefore, case development staff should ensure that appropriate
resources are available to conduct such oversight.
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Other Unique Factors (downward adjustment)
The RCPP allows an adjustment for factors that may arise on a case-by-case basis.
Penalties should be determined based on the maximum civil penalty the court or administrative
law judge is likely to award if the case proceeds to hearing or trial and on the inherent strength
of the case, considering such factors as:
• Probability of proving violations
• Opportunities to establish a useful precedent or send a signal to the regulated community
• Availability and effectiveness of the government's evidence and the potential strength
of the violator's defenses.
Where significant litigative risks exist, resource consideration may also be factored into the
decision. Downward adjustment of the proposed penalty for settlement purposes may be
warranted depending on EPA's assessment of litigation considerations.
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Appendix A
Penalty Computation Worksheet
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Penalty Amount for Complaint
Company Name:
Address:
Requirement Violated:
1. Gravity based penalty from matrix
(a) Potential'for harm
(b) Extent of Deviation
2. Select an amount from the appropriate multiday matrix cell
3. Multiply line 2 by number of days of violation minus 1 [or other number, as appropriate (provide narrative
explanation)]
4. Add line 1 and line 3
5. Percent increase/decrease for good faith
6. Percent increase for willfulness/negligence
7. Percent increase for history of noncompliance
8. Total lines 5 thru 7
9. Multiply line 4 by line 8
10. Calculate economic benefit
11. Add lines 4, 9 and 10 for penalty amount to be inserted in the complaint
Additional downward adjustments, where substantiated by reliable information, may be accounted for here:
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Settlement Penalty Amount
Company Name:
Address:
Requirement Violated:
1. Gravity based penalty from matrix
(a) Potential for harm
(b) Extent of deviation
2. Select an amount from the appropriate multiday matrix cell
3. Multiply line 2 by number of days of violation minus 1 [or other number as appropriate (provide narrative
explanation)
4. Add line 1 and line 3
5. Percent increase/ decrease for good faith
6. Percent increase for willfulness/negligence
7. Percent increase for history of noncompliance
8. Percent increase/ decrease for other unique factors (except litigation risk)
9. Add lines 5, 6, 7, and 8
10. Multiply line 4 by line 9
11. Add lines 4 and 10
12. Adjustment amount for environmental project
13. Subtract line 12 from line 11
14. Calculate economic benefit
.15. Add lines 13 and 14
16. Adjustment amount for ability-to-pay
17. Adjustment amount for litigation risk
18. Add lines 16 and 17
19. Subtract line 18 from line 15 for final settlement amount
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Narrative Explanation
2.
3.
4.
Gravity Based Penalty
(a) Potential for Harm
(b) Extent of Deviation
(c) Multiple/Multi-day
Adjustment Factors (Good faith, willfulness/negligence, history of compliance, ability to pay, environmental
credits, and other unique factors must be justified, if applied.)
(a) Good Faith
(b) Willfulness/Negligence
(c) History of Compliance
(d) Ability to pay
(e) Environmental Project
(0 Other Unique Factors
Economic Benefit
Recalculation of Penalty Based on New Information
A-3
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Appendix B
Example Penalty Computation
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Computation of Complaint Amount
The following example presents facts and a summary of the basis for calculating the basis for a civil penalty to be
included in an administrative complaint. Note that the computation worksheets are normally completed for each
violation (separate worksheets are used to calculate the penalty amount and the settlement amount), as is the
narrative explanation (again, to support both the complaint and settlement amounts for each violation). BEN
calculations are included here without supporting worksheets or printouts.
Facts
Company C, an owner/operator of several permitted commercial treatment facilities, regularly receives a large volume
of diverse types of RCRA hazardous wastes at its Evanston facility. Upon receipt of the wastes, the Evanston facility
immediately treats them and sends the treatment residues offsite for land disposal at another company's facility.
Company Z.
Between December 16, 1988, and December 18, 1989, Company C's Evanston facility received one shipment per
month of liquid F002 spent solvent wastes from various generators. Each shipment consisted of two 55-gallon
drums, but the composition and concentration level of hazardous constituents in each drum were different due to the
highly variable process that generated the waste. The Evanston facility did not test the wastes before or after treating
them, and its existing waste analysis plan did not require any such testing or other analysis to determine whether the
wastes are restricted. The Evanston facility properly manifested the 12 monthly shipments of wastes sent offsite to
Company Z, but it did not know until June 18, 1989, that 40 CFR § 268.7 requires a land disposal restrictions (LDR)
notification and certification to be sent with each shipment of waste. At that time. Company C began sending
§ 268.7 forms routinely stating that the treatment residues were eligible for land disposal.
On October 30, 1989, an EPA inspector at Company Z determined that 24 drums of Company C's F002 solvents
were unlawfully disposed in Company Z's landfill. The unlawfully disposed wastes had been sent to Company Z
in 1989 from the Evanston facility. Company Z's landfill did not meet minimum technological requirements and
was leaking hazardous constituents into the ground water, the only source of drinking water for the area. The
unlawfully disposed drums contained concentrations of F002 solvents in excess of the applicable Part 268 LDR
treatment standards.
Although four separate violations exist, only two violations (in (2)(a) and (b) below) are addressed for purposes of
this example. The following table summarizes the basis for calculating the penalty amount for the complaint,
followed by a discussion of the methodology used to calculate the settlement amount.
Violations
• 40 CFR 268.7(b)—Failure to Send Accurate Notifications and Certifications
• 40 CFR 268.7(b) & 268.264.13—Failure to Test Restricted Wastes
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Summary of Basis for Penalty Amount
Violations
268.7(b)—Failure to Send Accurate
Notifications and Certifications
268.7(b) & 268.264.13—Failure to
Test Restricted Wastes
Potential for Harm
Major: Company Z unaware that
wastes require further treatment
Substantial potential adverse effect on
purpose of RCRA
Substantial risk of exposure to
hazardous waste
Major: Failure to test contributes to
land disposal of ineligible hazardous
waste
Testing is critical element of LDR
Violation may pose substantial risk of
exposure to hazardous waste
Seriousness of
Deviation
Major: Initial failure to send forms
Subsequently sent uncertified
certifications
Major: Waste-analysis plan does not
require testing waste
Particularly significant with variable
waste
Penalty
$22,500 + $22,500 = $45,000 per shipment
$45,000 x 12 (violations) = $540,000
Multiday
Assessment
NA (each violation independent)
NA (same)
Economic Benefit
Avoid costs of forms; labor to
complete forms and certifications
BEN = $2,500
Avoid costs of waste analysis
BEN = $10,000
Adjustment Factors
Willfulness/negligence: Upward adjustment of 10% ($54,000) based on the fact
that Company C's other facilities had knowledge of 40 CFR 268.7
Penalty
$540,000 + $54,000 + $12,500 = $606,500
Final Complaint
Amount
Similar violation of same requirement justifies upward adjustment, but no upward
adjustment imposed because of adjustment above
Settlement
Adjustments
Other unique factors: Reduce penalty by 1/3 ($200,000); unable to tie drums to
Company Z or prove waste is F002 for 4 of 12 shipments
Final Settlement
Penalty Amount
$540,000 + $54,000 + $12,500 - $200,000 = $406,500
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Appendix C
EPA Memos
September 1995
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/ A ^
Im;
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON 0 C. 20460
OCT 2 6 1990
ENFORCEMENT SENSITIVE
vM.C-
RANDOM
SUBJECT!
FROM:
Issuance of the 199
James M. strec
Assistant A
CRA Civil Penalty Policy
Don R. Clay
Assistant Administr
and Emergency Raspd!
ant
for Solid wasta
TO:
Regional Administrators
Regional Counsal
Ragional wasta Managaaant Division Directors
Offica of General Counsal
Wa ara hereby transmitting to you tha final varsion of the
1990 RCRA Civil Penalty Policy. This policy raflacts tha input
of many contributors and commenters from tha Ragions and othar
Haadquartars offices, to vhom va extend our thanXs. Bacausa of
your substantial afforts, va baliava that tha final product has
baan improvad significantly.
Our purposa in ravising tha 1984 RCRA Civil Panalty Policy
is multifold. First, va hava updatad and aaandad tha 1984 policy
in light of tha experience tha Agancy has gainad sinca 1984.
Second, by (1) articulating a methodology for computing tha
amount of panaltias to b« sought in administrativa complaints and
aceaptad in sattlaaent, and (2) adopting raquiramants that such
calculations ba carafully documented, va hava attamptad to ansure
that in tha futura panalty amount . ara routinaly calculatad in
accordance vith tha panalty policy. Similarly, futura panaltias
accepted la settlement cannot simply ba compromises of initial
calculations, but must ba determined in accordanca vith tha
policy. Finally, in part by raquiring that multi-day panaltias
ba assassad in appropriata circumstancas for most continuing
violations, va saalc to incraasa tha amount of RCRA civil
panaltias and to axtand tha cost of noncomplianca to violators.
Basad to soma dagraa on tha RCRA Implamantation Study and othar
reports, it is our sansa that tha rata of complianca in tha RCRA-
regulated community can ba enhanced by assessing higher
penalties, which ara mora likely to deter regulatory violations.
6 32
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2
In several recent judicial decisions* courts have shown a
willingness to impose multi-day penalties (and concomitantly
largar total penaltiesV on. facilities iztcs& t© have vioiatad
requirements of rcra and attendant iaplefflenting ragulationJ. =-»
e_j. , Unifcad Stat«* v. Vinmforf Chemical Co. Tw?. . »g jjLi No.
So-1536 (D.H-J. April 30, 1990) (panalty of 51,000 per violation
per day) , united State* v. Eiwt rename I Watt* control. Tnf. 710
F. Supp. 1172, 1245 (K.O. Ind. 1989) (penalty of $2,000 pet day
for all violation* c©V-actively) , and Pnited st»t«i y. tas Brass
and Bran;* work*. 681 T. Supp. 314, 322 (D.S.C. 1988) (penalty
of $1,000 par day for the singia continuing violation assarted).
Tha $2,778,000 panalty obtained in gnvjrflnufnfciT efaste g^ntral
and tha $1,223,000 panalty obtained in vineiawfl are tvo of tha
largest courC-awardad RCRA penalties obtained by &PK in H.CSIK
prograa history.
Tha Agency also has racantly settled several RCRA cases for
penalty aaounts exceeding one million dollars. SfAr e.g.. the
consent decree entered September 14, 1988 in n«i*«d sta^«« v.
Bratming fmrrirn Industries. end e*gq& -pc..
No. 87-317 (K.D. La.)($2,500,000 penalty)# and the consent decree
entered August 16, 1WO in P-3, v. arnwwino Indu«*rjae.
Tng. and CTffflg iBfm.tiBml. Tic. . Ho. 81-0718-L0 (W.D. La.)
($1,550,000 panalty).
As -the court in yf-mal*s4 *r>4 cat twi emparlance suggest,
assessaeirt of penalties of this magnitude is often necessary to
persuade regulated firM not to treat tha prospect of a lawsuit
by £PA as an acceptable cost of doing, business. TP-* new
raquireaents in the RC3&A penalty policy that suiti-day penalties
be assessed fpr aost continuing violation* vill give impetus to
eCCori* ta obtain t&gbeT petnaVtias in the administrative forua,
as well.
You vill find that the final version of the policy differs
in a number o£ respects froa the draft circulated fox consents on
December 7, i?«t. Theaa changes# which are based ©a tha many
\»e received, include tha following*
1. Several Regions wars concerned about language in the draft
policy requiring aulti-day penalties to be imposed for each day
of any continuing violation. Th# principal concern was that the
requiraaastt would too often produce unrealiatically high
penalties in cases where violations had continued for years. The
final policy addresses this concern, first by adopting a 180 day
"floer* on sulti-day penalties, under which panaltias are
aandstory for the first 1*0 days of a continuing violation and
discrationary thereafter* In addition, for days 2 through 180 of
a continuing violation., va have. «a.da mnltirdAy panaltias eit&sr
(1) "mandatory#* "presumptive* or "discretionary* as deterained
by tha "cell" of the aulti-day matrix into which a violation
£33
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falls (based on gravity of the violation). The decision to
impose multirday penalties in cases determined to be presumptive
or discretionary nay depend on case specific factors outlined in
the policy (see attachment).
The policy also permits a Region to waive multi-day
penalties, even when mandatory for a violation, in "highly
unusual cases." This waiver may be exercised only with prior
consultation with Headquarters. It is anticipated that waivers in
these cases will be sought very infrequently. For violations in
which multi-day penalties are "presumed" appropriate, the
presumption may be overcome only if there are case-specific
factors which support the decision not to assess the multi-day
penalties. These factors must be documented in the case file.
Finally, in cases where multi-day penalties are "discretionary,"
the bases for the decision to impose or not impose multi-day
penalties must also be documented in the case file.
where multi-day penalties are "presumed" or discretionary,
the Regions would not be required to consult with Headquarters
prior to foregoing multi-day penalties. In the case of judicial
settlements, however0ye would retain the ability to review the
penalty calculations (including application of the presumption or
discretion) in exercising our concurrence authority.
are avare that at least one Region remains concerned about the
potential impact of the new RCPP on smaller businesses, we
believe the adjustment factors in the policy, including "ability
to pay," will address this concern. Zn addition, we intend to
review the Regions' experience in implementing the new policy.
In the course of that review, we will further evaluate these or
other concerns.
2. Several conmenters also worried about the practical
implications of the requirement in the draft that penalties be
assessed for each distinguishable violation of the statute or
regulations* Zt was pointed out that (1) when a facility fails
to obtain a permit or interim status, it, is automatically in
violation of most of the requirements of Part 265, and
(2) a violator who fails to install a groundwater monitoring
system as required, 1p«q facta violates a number of other
requirements of Subpart F. The commenters' concern was that
assessing a penalty for each day of each separate violation in
the situations described might too often produce uncollectible
penalty figures. To avoid this result, the final policy permits
the Regions to forego penalties for certain distinguishable
violations which necessarily or generally result from a single
initial transgression, as long as the total penalty is
appropriate, sufficient to deter future behavior, and recoups any
economic benefit from noncompliance.
3. The final policy now applies not only to actions filed after
CM
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it is issued, but also, insofar as practicable, to actions filad
before its data of issuance.
4. The policy now providas that documentation underlying penalty
calculations {particularly calculations establishing the amount
of tha panalty tha Agency will accapt in settlement) nay often b«
withheld from those requesting it under FOIA, even after
completion of an enforcement proceeding, on grounds it is
protected by the attorney work product and deliberative process
privileges.
5. The policy has been revised to permit an upward adjustment in
the penalty amount where a violator's past record shows a pattern
of noncompliance with the requirements of RCRA or other
environmental statutes.
He would like to take this opportunity to emphasize to all
Agency enforcement personnel the iaportance of adhering to the
uniform methodology for penalty assessment contained in the 1990
RCRA Civil Penalty Policy. RCRA enforcement will serve as a
credible deterrent if public perception (and the underlying
reality) is that EPA will consistently seek and settle for
amounts no less than the tough but fair penalties provided for in
the revised policy.
If EPA doas not seek penalties for distinguishable
violations, regulated facilities say be tempted to dismiss the
need to comply with separate regulatory requirements. If the
Agency does not routinely recoup the economic benefit of
noncompliance, the regulated community will have little financial
incentive to achieve and maintain compliance with applicable RCBA
requirements. Zf the Agency does not assess a gravity-based
penalty commensurete with the seriousness of the violation, the
total penalty figure will lack the proper impact. If
multi-day penalties are not assessed, total penalties may be too
low, and the regulated community will be rewarded for
noncompliance and remain indifferent to the importance of
rectifying violations quickly.
Finally, if penalty amounts are adjusted downward casually
for reasons aefc cognisable under the penalty policy, regulated
firms will have further grounds for taking their environmental
responsibilities lightly. In this context, we would remind you
that a downward adjustment in the penalty amount for good faith
efforts to comply is no longer proper where a facility does not
act to effectuate compliance until after notification of a
violation by tha Agency, compliance with applicable requirements
should be the accepted norm, not grounds for mitigating the
penalty. By tha same token, chronic offenders of RCRA or other
environmental laws should be appropriately punished through
upward adjustaent of penalty amounts based on a history of
noncoapliance.
we believe that tha new policy, while tough, is fair, and
affords the necessary flexibility to account for case-specific
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facts and litigation risks. It accommodates adjustments on
targeted penalty amounts as a ease progresses and the facts
crystalliM.. We _recogni2e that this flexibility is isa»rtant to
MK ta cmt as strong a claim as possible up front
and give respondents as much incentive as possibla to settle '
quickly ofl terms which ars appropriate for achieving our policy
objective#. However, it is critical that any settlement
adjustments confers with the policy.
"We v$uld also stress th* importance of documenting the
penalty amounts sought in tha complaint and accapead in
sattleaea* through use of th* penalty computation worksheets and
narrative explanation foru provided in the revised policy,
these documentation procedures serve several purposes. They
encourage rigor and coneiAteticy In penalty calculation*. They
can, be used to satisfy the requirement iaposed by some
Administrative Lav Judges an4 court decisions that EPA provide
defendants with the detailed factual bases and £atlcnal«s for the
panalty amounts sought in cc*p2aints. They also facilitate
oversight by the Inspector General'* office and our offices, all
of whom s««X to a.R*ure, that th* S.C3A Civil Penalty Policy is
faithfully and consistently applied.
To ensure the fevised penalty policy is being implemented
cfirrectly, Headquarters will periodically reviev and analyze
Regional penalty calculation worksheet* te determine Regional
cismpliar.ee with the poVicy provisions. Effective immediately,
Regions ar* asked to attach a crpy of the final penalty
calculation worksheet and written narrative [samples are provided
in the penalty policy) to all final SOU administrative orders
v£*n they sre sent te Headquarters for entry into the RCRA
Administrative Action Tracking System {MATS), these orders
should sent to Bob Small, OWPE, RCRA Enforcement Division,
Headquarters, Kail code 09 539. Please note that this
requirement is in addition to, and not In place off the penalty
policy's requirement that copies of the worksheet and vritten
narrative supporting the penalty in the complaint and at final
settlement be kept in the cams file. This requirement la
discussed further in the Assistant Administrator
for OE1 s August 9, 1990 memorandum, "Documenting Penalty
Calculation* 4nd Justifications in EPA Settlement Agreements."
Region* also will be required to conduct self'assessments cf
thair an-^oing efforts to inclement the revised penalty policy
and send a biannual Salf-Assessment Report to Headquarters' The
guidelines for conducting the self-assessment are flexible, to
accommodate the pertieular needs of your enforcement program. At
a minimum, the Report should 11 describe your training efforts,
including seminars, semes and other guidancej and 2) establish a
tracking system or checklist a&svc that the penalty
calculation criteria set forth in your training efforts sest
Headquarter * s criteria and verifies that these criteria are being
properly implemented in your Region.
The first Self-Assessmsnt Report will be due on Kay 1, 1991-
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6
Please send the Report to Karin Leff at OWPE, RCRA Enforcement
Division, Headquarters, Kail code OS 520. You should also refer
any questions to Karin at (FTS/202) 382-5618.
wa regard the issuanca of this ravisad policy as a naeassary
and important stap toward enhancing tha RCRA enforcement program.
Wa ara confidant that vith your cooperation, wa will not only
obtain higher penalties, but higher levels of compliance by RCRA-
regulated concerns, as well.
Please direct questions concerning the policy to Jon
Silberaan (FTS-475-9769) of the Office of Enforcement - RCBA
Division and Karin Leff (FTS-382-5618) of the Office of Waste
Programs Enforcaaent. We anticipate providing Regional training
on how to apply the policy. These persons will contact you in
the near future to arrange for training Regional staff.
Attachment
£37
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7
Attachment
MULTXDAY PBIALTIES
MULTIDAY PENALTY MATRIX
Ert'nt of
Proa Regulatory Biflulrwnt
Pafntial
las.
Hara
MAJOR
MODERATE
MINOR
MAJOR
M.
M.
Pr.
MODERATE
M.
Pr.
Dis .
MINOR
Pr.
Dis.
Dis.
lift "M* auni, "Mandatory"
"Pr." aaans, "PrssuBed*
"Dia." aaans, "Discretionary*
5®
7> —
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£3?
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»• ^ **
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
DEC I 2 !99l
MEMORANDUM
SUBJECT:
FROM:
Draft Interim Policy on Pleading Proposed Penalties in
RCRA Administrative Complaint#
Kathia A. stain
Enforcement Counsel for RCRA
Offica of Enforcaaant (LE-134S
Bruca Diamond, Diractor
Offica of Wasta Programs
orcement (OS-500)
TO:
Regional Counsel
Ragional Wasta Managaaant Division Diractors
The attached draft intaria policy rasponds to your requests
for guidanca on hov to plaad proposad panaltias in RCRA
administrative complaints. Tha guidanca addresses concerns
raised regarding tha requirement in 40 C7R S 22.14(a)(5) of
the Consolidated Rules of Practice (CRP) to include, in
administrativa complaints, "a statement explaining tha reasoning
behind the proposad penalty."
This issue is a complex one implicating a nuaber of Agency
penalty policies under several statutes. Because the issue has
arisen most frequently in the RCRA prograa, va are issuing this
draft intaria policy for RCRA administrative complaints at this
time. Pleasa follow tha draft intaria policy for the time being.
We specifically request your comments on tha draft interim
policy. We also vish to inform you that, while there are no
plans at present to issua multimedia guidanca on the issue, we
are inforasd that tha issua has been discussed by the recently
reactivated Part 22 Regulatory Amendments Workgroup. This
workgroup is considaring amendments to tha Consolidated Rules of
Practice, generally.
Pleasa address any questions or comments on the draft
interim policy to Jon Silberman, OE-RCRA Division (FTS 260-3082)
or Karin Leff, OSWER-Office of Wasta Prograas Enforcaaant (FTS
260-5618). Comments on potential amendments to the Consolidated
Rules, including 40 CFR S 22.14(a)(5), may be sent to the
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2
Workgroup Chair, Tracy A. Gipson, OE-Office of Compliance
Analysis and Program Operations (FTS-260-8780).
Attachment
cc: Scott Fulton
Enforcement Counsels
Kathy Summerlee
ORC RCBA Branch Chiefs
RCRA Program Branch Chiefs
£.fi
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, O.C. 20460
OEC 1,2 !99(
- DRAFT INTERIM POLICY -
BAfflSH
SUBJECT: Pleading Proposed Penalties in RCRA Adainistrative
Complaints
FROM: Kathie A. Stain Q.Sh
Enforceaent Counsel for RCRA
Office of Enforceaent (LZ-134S)
Bruca Diamond, Diractor
Offica of Waste Programrf-£jf6?5fcaant (OS-500)
TO: Rational Counsel
Regional Wasta Manageaent Division Diractors
This memorandum addrassas the plaading requirements for
proposad panaltias in RCRA administrative complaints. '/ 40
CFR s 22.14(a)(5) of tha Consolidatad Rulas of Practica (CRP)
requiras an administrative complaint to include "a statamant
V Tha Consolidatad Rulas of Practica, including 40 CFR
S 22.14(a)(5), apply strictly to adainistrativa complaints. Thus
this aaaorandua doas not addrass tha plaading or docuaantation of
penalty amounts in aithar civil judicial coaplaints, or civil or
adainistrativa sattlaaants.
In civil judicial complaints, tha policy of tha Unitad
statas is to request up to tha statutory aaxiaua civil panalty
amount, b—td on tha facts of aach casa. No corresponding
penalty dm.umsntation is prepared nor is such documentation
required in the complaints.
All documentation of settlement amounts in civil and
administrative cases should be considered privileged information
(i.e., "attorney work product" or "attorney-client
communication"), and prepared accordingly, i.e., by or at the
direction of an attorney. To preserve the work product
privilege, it is important that where program personnel prepare
such docuaents the record reflect it is at the direction of an
attorney.
MM Ort R»eyel9d Pafi»r
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-2
explaining the reasoning behind the proposed penalty." Concern
has been expressed that several judicial or administrative
decisions may be read as suggesting that EPA's "boilerplate"
penalty language (RCRA Civil Penalty Policy [RCPP] at 7) may be
insufficient to satisfy this requirement. '/
This issue is a complex one implicating a number of Agency
penalty policies under several statutes. Because the issue has
arisen most frequently in the RCRA program, we are issuing this
draft interim policy for RCRA administrative complaints at this
time. Under the draft interim policy, it is recommended that
RCRA administrative complaints include, at a minimum, brief
narrative descriptions of the reasoning behind the proposed
penalty for each separate count for which a penalty is sought.
None of the decisions cited in the footnote hold that EPA is
required, by 40 CFR S 22.14(a)(5), to provide its penalty
computation worksheets to respondents upon filing complaints.
A Region may elect, however, as a matter of Regional policy, to
provide additional non-privileged penalty computation information
to respondents when the complaints are filed. }/
2/ Environmental Protection Corp. v. Lee Thomas.
CV F-87-447 EDP (E. Oist. Cal.; July 14, 1988) (Memorandum
Decision re: Cross Motions for Summary Judgment); In re:
Environmantal Protection Corp.. Docket No. RCRA-90-86-0001
(Decision and Order; October 24, 1989); In re: Environmental
Protection Corp.. RCRA (3008) Appeal No. 90-1 (Order Adopting the
Presiding Officer's Decision on Remand as Final Agency Action;
September 12, 1990); In re: Florida Fence Poet Co. . Docket No.
90—09—R (Ruling on Notion to Dismiss; November 30, 1990); in re:
Coors Bravina Co.. Docket No. RCRA-VIII-90-90 (Order on Motions;
January 4, 1991).
3/ In administrative actions, a Region may for strategic
purposes or. to facilitate settlement provide respondents with
more information early in the action than required by 40 CFR S
22.14(a)(3). In addition, as the litigation proceeds, the
complainant will normally be required to supply detailed
information on the bases for proposed penalties in the prehearing
exchanges of witnesses and exhibits and at hearing. While a
Region may elect to raly on previously prepared penalty
documentation in these situations, care should be exercised not
to cause litigative risk analyses, settlement positions, or other
privileged information to be released. For this reason, even the
initial documentation for proposed penalty amounts should be
prepared and handled to protect government evidentiary privileges
by placing all privileged information relating to litigative risk
or potential mitigating factors in separate memoranda marked as
"attorney work products" or "attorney-client communications."
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Attached to this memorandum are examples of narrative
statements which we expect would be viewed as sufficient to
comply with 40 CFR 5 22.14(a)(5). The narrative statements
correspond to three violations which appear in the RCPP as
hypothetical applications of the Policy. Please include similar
narrative statements in future RCRA administrative complaints.
Attachment
cc: ORC RCRA Branch Chiefs
RCRA Program Branch Chiefs
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- Attachment -
40 cn $ 22.14(a) (S):
EXAMPLES 07 NARRATIVE PEHALTY STATEMENTS
Example l Narrative statement of the reasoning behind the
proposed penalty for the violation described in the RCPP at pages
48-51 and 61-64:
Operating without a permit or interim status (42 u.s.c.
6925): By operating without a permit or interim status, the
violator caused a substantial risk of exposure of humans and
the environment to hazardous wastes, with substantial
adverse effects on RCRA implementation. Because the
violator neither notified EPA that it stored hazardous waste
nor submitted a Part A application, it was in total
noncompliance for the duration of the violation. The
violation continued for 343 days, and provided an economic
benefit of at least $9,000 to the violator.
Example 2 Narrative statement of the reasoning behind the
proposed penalty for the violation described in the RCPP at pages
70-72 and 74-77:
Failure to prevent entry (40 CFR S 265.14): The
potential for harm and human exposure to hazardous wastes is
substantial under the facts of this case. While a fence
existed, because a substantial portion of it had been
knocked down, there was significant noncompliance. The
violation continued for 135 days. The violator received an
economic benefit of $12,743 from its noncompliance. The
violator has been cited in writing on at least two prior
occasions for failing to prevent public access to the active
portion of its facility.
Example 3 Narrative statement of the reasoning behind the
proposed penalty for the violation described in the RCPP at pages
87-91 and 93-96:
Failure to send accurate LDR notifications and
certifications (40 CFR S 268.7): The violator's failure to
properly notify its TSD facility that it was providing LDR-
restricted wastes hindered the TSD's ability to characterize
the wastes and caused a substantial adverse impact on the
RCRA program. The violator provided substantially deficient
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RCRA Practitioners Enforcement Workshop
Civil Penalties Under RCRA
Appendix D
EPA Summary of Case Law
September 1995
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Cases Updated As of Summer, 1994
Notes Updated As of Spring, 1995
RCRA ENFORCEMENT & PENALTIES:
ILLUSTRATIVE JUDICIAL AND
ADMINISTRATIVE DECISIONS
Prepared by: Jon Silberman, Senior Counsel
OECA-ORE-RCRA Enforcement Division
Please address any comments or recommendations
for expanding/improving this outline to Jon
Silberman at 202-564-4006 (FAX 202-564-0019).
Table of Contents
RCRA STATUTORY PENALTY PROVISIONS 1
DETERRENCE 3
SEPARATE PENALTIES FOR SEPARATE VIOLATIONS 5
GRAVITY-BASED PENALTY/ADJUSTMENT FACTORS "HIERARCHY" 8
GRAVITY OF THE VIOLATION - "POTENTIAL" FOR HARM 8
GRAVITY OF THE VIOLATION - RISK TO HUMANS AND THE ENV 11
GRAVITY OF THE VIOLATIONS - HARM TO THE RCRA PROGRAM 14
EXTENT OF DEVIATION 15
MULTIDAY PENALTIES * 17
ECONOMIC BENEFIT OF NONCOMPLIANCE 19
ADJUSTMENT FACTORS: GOOD FAITH/LACK OF GOOD FAITH 21
DEGREE OF WILLFULNESS AND/OR NEGLIGENCE 24
HISTORY OF NONCOMPLIANCE 25
ABILITY TO PAY 26
OTHER UNIQUE FACTORS 27
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— NOTICE: RCRA decisions are "starred." —
Note: This outline summarizes soie of the four hundred-plus
RCRA administrative opinions accessible through LEXIS and
other electronic databases. The decisions exemplify how the
courts, the Environmental Appeals Board, and the Agency's
Presiding Officers apply the factors in the statute and RCRA
Civil Penalty Policy (RCPP) to assess appropriate penalties.
It is not possible to reproduce in an outline of this
magnitude all of the case-specific factors and nuances that
may have influenced the Judges in reaching their decisions.
Review a hard copy of each decision before citing it as
precedent in litigation.
The "Notes" in this outline provide useful background
information on interpreting the RCRA penalty criteria and
the cited cases. Nevertheless, they do not necessarily
state EPA policy, and should not be cited as representing
official EPA positions.
RCRA STATUTORY PENALTY PROVISIONS:
1. Section 3008faW31 [42 U.S.C. S 6928(a)(3)]:
Penalty: $25,000 per day of noncompliance for each
violation of the requirements of Subtitle C of
RCRA - assessed in an order.
Statutory Factors: "seriousness of the violation"
"any good faith efforts to comply"
2. Section 3008
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5. Section 3013(el [42 U.S.C. 5 6934(e)]:
Penalty: $5,000 for each day during which the defendant
fails to comply with a S 3013 order.
Statutory Factors: None.
6. Section 7003(bl [42 U.S.C. S 6973(b)]:
Penalty: $5,000 for each day of violation of a $ 7003
imminent and substantial endangerment
administrative order.
Statutory Factors: None.
7. Section 9006faW31 [42 U.S.C. $ 6991e(a) (3) ]:
Penalty: $25,000 for each day of continued non-compliance
with an UST administrative order.
Statutory Factors: None.
8. Section 9006(dlm [42 U.S.C. S 6991e(d)(1)]:
Penalty: $10,000 for each tank for which notification is
knowingly not given or for which false information
is submitted.
Statutory Factors: None.
9. Section 9006 (dW2) 42 U.S.C. S 6991e(d) (2) ] :
Penalty: $10,000 for each tank for each day of violation of
specified UST regulatory requirements.
Statutory Factors: None.
10. Section 11005 (aW21 [42 U.S.C. S 6992d(a)(2)]:
Penalty: $25,000 per day of noncompliance with the
requirements of the Medical Waste Tracking Act for
each violation. Assessed through an
administrative order.
Statutory Factors: "seriousness of the violation"
"good faith efforts to comply"
11. Section llOOSfa)(41 [42 U.S.C. S 6992d(a)(4)]:
Penalty: $25,000 for each day of continued noncompliance
with a Medical Waste Tracking Act administrative
order.
Statutory Factors: None.
12. Section 1100S(dl [42 U.S.C. S 6992d(d):
Penalty: $25,000 for each violation of the requirements of
the Medical Waste Tracking Act with each day of
violation constituting a separate violation.
Assessed by a court.
Statutory Factors: None.
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DETERRENCE:
*** United States v. T 6 S Brass and Bronze Works. Inc.. 681 F.
Supp. 314, 322 (D.S.C. 1988), &H1A, 865 F.2d 1261, 28 Env't Rep.
Cas. (BNA) 1649 (4th Cir. 1988): Defendant T & S was ordered to
pay a $194,000 penalty ($l,000/day for 194 days of LOIS
violations). The Court held: "Assessment of the amount of a
civil penalty is committed to the informed discretion of the
Court. (Citations omitted). In exercising this discretion, the
Court should give effect to the major purpose of a civil penalty:
deterrence. United States v. Phelps Dodge Industries. Inc..
589 F. Supp. 1340, 1358 (S.D.N.Y. 1984); United States v.
Swinaline. Inc.. 371 F. Supp. 37, 47 (E.D.N.Y. 1974); State, ex
rel. Brown v. Davton Malleable. Inc.. l Ohio St. 3d 151, 438
N.E.2d 120, 125 (1982)."
*** United States v. Environmental Waste Control 710 F. Supp,
1172 (N.D. Ind.), aff'd 917 F.2d 327 (7th Cir. 1990). The Court
imposed a penalty of $2.78 million based on the following
factors: (1) deterrent impact of penalty (the Court discussed
both general deterrence and specific deterrence); (2) lack of
good faith efforts to comply; and (3) the seriousness of the
violations. The Court cited T & S Brass and Bronze Works, supra,
and the cases cited in T & S. in holding that "the Court should
give effect to the major purpose of a civil penalty* deterrence."
710 F. Supp. at 1242. "A civil penalty must provide a meaningful
deterrence without being overly punitive; it should be large
enough to hurt; it should deter anyone in the future from showing
a similar lack of concern with compliance. (Citation omitted)."
Id. at 1244. "EWC has been faced more than once with a choice
between disobeying the law or continuing its operations; each
time, EWC chose to disobey the law and make more money.
Substantial penalties ... are warranted." Id. at 1245.
*** United States v. Vineland Chemical Co.. No. 86-1936 (D.N.J.
April 30, 1990), reprinted in 31 ERC 1720, aff'd. 33 Env't Rep.
Cas. (BNA) 1316 (3d Cir. 1991): Citing T & S Brass and
Environmental Waste Control, the district court held that the
civil penalty must provide a meaningful deterrence without being
overly punitive. See also U.S. v. Ciampitti. 669 F. Supp. 684,
700 [26 ERC 2026} (D.N.J. 1987) ("civil penalties are imposed
With the aim of both punishing the defendant[s] and of deterring
[them] and others from taking further [illegal] action"). ... We
must be clear to the regulated community that violations of the
law are not treated lightly, especially where the regulations
protect public health and the environment. Moreover, a
significant penalty deprives violators of any economic benefit
from delay in compliance. Too small a penalty risks being
considered by violators as 'an acceptable cost of violation,
rather than as a deterrence to violation. U.S. v. ITT
Continental Baklno Co.. 420 U.S. 223, 231 (1975)." The Court
imposed a $1,223,000 penalty for LOIS violations.
£ 5~
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Diver, "The Assessment and Mitigation of Civil Money
Penalties by Federal Administrative Agencies," 79 Colua. L. Rev.
1435, 1458: "The efficacy of any regulatory program depends on
the sanctions imposed in individual cases. If these sanctions
are set too low, potential yiolators may be insufficiently
motivated to minimize the social harm resulting from their
behavior, or society may be under compensated for the harm that
does occur."
*** U.S. v. Ekco Housewares. Inc. (H.D. Ohio): On January 28,
1994, the United States obtained a $4.2 million penalty judgment
in this matter based on Ekco's failure to maintain financial
assurance for closure, financial assurance for post-closure, and
liability coverage. The Court's deterrence-based analysis of the
purposes of a civil penalty at pages 38-39 of the opinion, which
cites many of the cases in this section of the Outline,
represents a textbook elucidation of these penalty
considerations. The Court found that Ekco accrued a total
economic benefit (EBN) of $434,000. The Court cited this EBN as
the "floor" of Ekco's penalty, which it then increased
substantially in order to create "substantial disincentives" to
deter Ekco and others from similar violations.
United States v. Maiorano. No. 87 C 4491 (H.D. 111.; January
8, 1990), reprinted in 20 ELR 20444: "The government argues that
a substantial penalty is warranted for reasons of deterrence.
[Citations omitted] The Court agrees. ... Defendant[s] ...
disregarded specific orders ... have not taken this matter
seriously, and they have exhibited a pattern of behavior which
evidences a complete disregard for statutory law, EPA orders, and
judicial orders. To impose merely a perfunctory or token penalty
would send a message to similarly situated persons that they may
flout the law without consequence, ooo The government has
suggested that a civil penalty of $100,000 - about $110 per day -
would be appropriate. Although this figure is a relatively small
proportion of the maximum penalty [permitted by law], it is
nonetheless a substantial sum, and would serve [RCRA's]
deterrence purposes..."
*** United States v. ILCO. No. CV-85-H-823-S (N.D. Ala. Oct. 8,
1991): The court imposed a penalty of $3,500,000 against a
company in bankruptcy, and its president, for RCRA and Clean
Water Act violations. In setting the penalty, the court "engaged
in a delicate balancing of requiring compliance, punishing non-
compliance and endeavoring to keep viable, if possible, a
business which can be of great value to the implementation of
policies embodied in federal and state environmental laws."
*** United States, et al. v. Production Plated Plastics. Inc..
et al.. File No. K87-138 CA (W.D. Mich.): The Court described
the $1.5 million RCRA penalty for violations including operating
£57
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unpermitted seepage lagoons as, "certainly large enough to
hurt ..."
*** In the Matter of; J.V. Petpi-a *n& Co-- at al.. RCRA Docket
No. V—W-8l-R-75 (Initial Decision [Order on Remand]; September
26, 1988: "... the civil penalty provision of RCRA is
essentially regulatory, seeking to enhance compliance with the
Act rather than impose penal sanctions on those vho violate the
statute ... (citation omitted)."
U.S. V. Trident Seafoods Corp.. No. C92-1025D (Order;
December 13, 1993) at 7, n.4: "The rationale for considering the
size of the company and the financial impact of the penalty is
explained in United States v. Chevron U.S.A.. Inc.. €39 r.Supp.
770, 779 (W.D. Tex. 1985): 'Only a substantial penalty would have
any economic impact or serve as any deterrent [to a major
corporation].'"
SEPARATE PENALTIES FOR SEPARATE VIOLATIONS:
Blockburaer v. United States. 284 U.S. 299, 304 (1932):
"Where the same act or transaction constitutes a violation of two
distinct statutory provisions, the test to be applied to
determine whether there are two offenses or only one, is whether
each provision requires proof of an additional fact which the
other does not."
*•* In the Matter of: ROI Development Corp.. Docket No. RCRA
(3008) VIII—90-12 (Initial Decision; March 31, 1994); On June
26, 1990, Region 8 filed a complaint under the 1994 RCRA penalty
policy alleging 3 separate RCRA violations. The violations all
resulted from a single, 1988 shipment of 100 gallons of 1,1,1,
trichloroethane (TCE) to a non-Subtitle C disposal unit. The
Region charged the Respondent with causing the illegal disposal
of hazardous waste (Count I), improperly characterizing the waste
on its manifest (Count II), and failing to notify the receiving
facility of the appropriate LDR treatment standard (Count III).
The ALJ, citing the test in Blockburaer v. U.S. (i.e., "whether
each violated provision requires proof of an additional fact
which the other does not"), agreed with Region 8 that each of the
ROI'b violations should be penalized separately. The Judge
agreed with the Respondent that "the violations revolve around a
single factual incident," Decision at 22. He found, however,
that "all three involve separate elements of proof." Decision at
23. In addition, the requirements have "separate regulatory and
statutory purposes." Decision at 25. Decided by Judge Head.
*** In the Matter of: Martin Electronics. RCRA Appeal No. 86-1
(Order on Sua Sponte Review; June 22, 1987): In the-Initial
Decision, the ALJ had held: "In the instant case, the Respondent
failed to notify the Agency of the fact that it was generating
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and storing spent solvents on its premises which the Respondent
used to clean parts and thin paint. ... My reading of this
record would suggest that the Respondent was guilty of
essentially one act and that was the failure to notify the Agency
of the existence of these wastes on its property. The fact that
is failed to do so in several instances and under several
different regulations does not in ay judgment authorize the
assessment of three different penalties which, in essence, arise
from the same factual situation." On review, the CJO reversed
this holding. Characterizing the issues as one of "legislative
intent," the CJO found that RCRA "contemplated that separate
penalties would be assessed" for separate violations of distinct
hazardous waste notification requirements. See also F.A.A. v.
Landv. 705 F. 2d 624, 636 (2d Cir. 1983), cert, den. 464 U.S. 895
(1983), and Loucrren v. Bvrae. 787 P. 2d 857 (3rd Cir. 1986),
cited in support of the holding.
*** In the Matter of: F & K Plating Co.. Appeal No. 86-1A
(Final Decision; October 8, 1987): "Even violations of the same
regulations at a single location can result in separate penalties
where they involve two or more independent acts and pose distinct
risks." In this case, separate penalties were assessed for
failing to maintain adequate security and failing to post warning
signs. (The CJO added, however, that even if the two counts were
consolidated, the "extent of deviation" would increase from
"moderate" to "major," resulting in essentially the same penalty
amount.")
*** In the Matter of Fair Haven Plastics. Inc.. et al.. Docket
No. RCRA V-W—88—R—005 (Initial Decision; May 3, 1989): In this
interesting decision, the ALJ refused to accept EPA's penalty
assessment witness's own determination that several different
violations could legitimately be grouped together for penalty
assessment purposes. Applying the "requires an element of proof
not needed by the others" test, the Judge grouped the "failing to
obtain an EPA ID Number" and "shipping hazardous waste without an
EPA ID Number" violations together, but insisted on separate
penalty assessments for each of the following remaining
violations: storage of hazardous waste without interim status or
a permit; failure to properly label containers; failure to
develop a personnel training program; and failure to develop a
contingency plan and emergency procedures. As a consequence, the
Court's GBP calculation was considerably higher than the
Region's. Decided by Judge Frazier.
Public Interest Research Group of New Jersey. Inc. v. Powell
Duffrvn Terminals. Inc.. No. 89-5831 (3rd Cir. 1990) (filed
August 20, 1990: at 28 - 29: PIRG was accused of "double
counting" when it counted a single reported exceedance for a
pollutant as a violation of both the average concentration limit
and the maximum concentration limit for that pollutant. Held:
"These are clearly separate limitations and we see no reason wfey
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PDT should not be penalized separately for violating each
limitation."
In the Matter of; 3M Company. TSCA Appeal No. 90-3 (Final
Decision, February 28, 1992): TSCA Sections 5 and 13 "new
chemicals program" penalty appeal. Held: separate penalties
assessed for each separate act of illegal "new chemical" import;
separate penalties also assessed, per illegal act, under (l) TSCA
Section 5 (import without a premanufacture notice [PMN]); and
(2) TSCA Section 13 (false certification to Customs Department).
In the Matter of: Helena Chemical Company; FIFRA Appeal No.
87—3 (Order; November 16, 1989): Appeal of Initial Decision
assessing a $12,400 penalty for numerous FIFRA violations. On
the issue of liability, the ALJ determined that EPA had proven
twenty separate illegal sales of the restricted use pesticide,
but imposed, only a single penalty. This aspect of the holding
was reversed on appeal, and a new $117,400 penalty assessed:
Held: "[E]ach sale was an independent act, requiring independent
proof that the transaction occurred and also proof that the
purchaser was not certified on the date of the sale. ... I
disagree with respondent's contention that the twenty sales —
which spanned a six month period — were part of *the same series
of events' merely because they involved the same vendor and
purchaser and the same pesticide."
*** in the Matter qg; .Elvin
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GRAVITY-BASED PENALTY/ADJUSTMENT FACTORS "HIERARCHY1*:
In the Matter of: 3M Company. TSCA Appeal No. 90-3 (Final
Decision, February 28, 1992): TSCA Sections 5 and 13 "new
chemicals program" penalty appeal. Held: appropriate method of
calculating penalty is to first calculate a gravity-based
component to reflect the seriousness of the violations, and
second adjust the GBP based on factors relating to the violator.
In this case, the existence of a compliance program and the
inadvertence of the violations did not affect the potential for
harm (gravity) of the violations and so were properly considered
factors relating to GBP adjustments. "[3M's] commitment [to
compliance] does not lessen the probability of harm occurring
once a violation has taken place. ... [Rather, they relate to]
the actions and intent of the violator [which deserve
consideration] during the second [adjustment] phase of the
analysis ..."
*** In the Matter of: National Coatings. RCRA Appeal No. 86-5
(Final Decision; January 22, 1988): Based on evidence that the
Respondent "had no intent to dispose of hazardous vaste
improperly," the ALJ assigned a lover GBP than provided for in
the RCRA penalty policy. The CJO reversed the Initial Decision
and reinstated the Agency's proposed GBP, holding that the
violator's "intent" is irrelevant to the issue of the potential
of the violation to cause harm.
GRAVITY OF THE VIOLATION - "POTENTIAL" FOR HARM:
*** In the Matter of: A.Y. McDonald Industries. Inc.. Appeal No.
RCRA (3008) 86-2 (Final Decision; July 23, 1987): The CJO
rejected the Respondent's argument that its penalty should be
reduced because no actual harm resulted. The focus of the RCRA
penalty policy is on potential for harm, not actual harm or
intent. "McDonald should not be rewarded for its complete
disregard of the RCRA program simply because test results this
far fail to show groundwater contamination.1*
All Regions Chemical Labs.. Inc. CERCLA-I-88-1089 (May 3,
1989). (Accelerated Decision, EPCRA case) aff'd sub nom. All
Regions Chemical Labs.. Inc v. United States Environmental
Protection Agency. No. 90-1715 (1st Cir., May 6, 1991): The
violator-appellant failed to notify the National Response Center
(NRC), pursuant to CERCLA Section 103(a), promptly upon learning
of two fires. The fires released 180,000 pounds of chlorine into
the air, creating a chlorine cloud forcing 30,000 people to be
evacuated. The statute required "immediate" notification. EPA
learned of the first fire, 5 hours after it began, from a private
citizen. EPA learned of the second fire, two hours after it
began, from the Massachusetts Department of Environmental
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Quality. All Regions itself gave the NRC formal notice only
months later. Though CERCLA Section 109(b) permits penalties of
up to $25,000 per day for continuing violations of notification
requirements, EPA assessed a one-day penalty in light of the
notice it had received from the private citizen and state agency.
The penalty assessed was $20,000, or 80% of the statutory
maximum. In contesting the $20,000 penalty, All Regions argued
that no actual harm resulted from its late notification to EPA.
Even after receiving notice, the violator claimed, EPA had little
involvement with the response action. Held: the key factor for
penalty assessment purposes is potential for harm: "When the
violation was committed, that is, when the release first took
place, failure to notify EPA might well have caused serious
harm." "[The ALJ's] discussion, taken as a whole, "suggest[ed]
that the ALJ was considering what might have happened in the
absence of the *fortuitous' events of adequate responses and
notification by other parties ... Given the [A]gency's legal
power to assess penalties in terms of what might have happened
... rather than what did happen, All Region's argument is
unconvincing." (Emphases in original.) The Court also rejected
All Regions' argument that EPA improperly failed to credit it for
$1,205 million spend in clean-up costs. The violator sought a
35% penalty adjustment to reflect these costs. The Court found
instead that "since clean-up costs will often be associated with
harm, larger costs would often mean larger harm, calling for a
higher, not a lower, penalty." Thus the clean-up costs plus the
penalty amount, taken together, were not "excessive for the
particular violation."
*•* U.S. v. Ekco Housewares. Inc. (N.D. Ohio): On January 28,
1994, the United States obtained a $4.2 million penalty judgment
in this matter based on Ekco's failure to maintain financial
assurance for closure, financial assurance for post-closure, and
liability coverage. In analyzing the gravity of Ekco's
violations, the Court considered the identity and toxicity of the
hazardous constituents at the site, the intent of the violated
provisions in terms of the potential risks they were designed to
prevent, and the purposes of a civil penalty.
In the Matter of: 3M Company. TSCA Appeal No. 90-3 (Final
Decision, February 28, 1992): In this TSCA Sections 5 and 13
"new chemicals program" penalty appeal, the CJ6 determined that
the GBP must reflect the "probability" of harm from the
violations.
In the Matter of: State of West Virginia. Department of
Highways. TSCA Appeal No. 86-2 (Final Order; January 21, 1987).
Respondent in PCB case appealed imposition of full proposed
penalty, arguing that the penalty should be reduced because "no
harm to persons or the environment resulted from [the
Respondent's] violations." Held: "[C]ongressional intent [does
not] waiver where, as here, there has been no known present
(o t> £
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damage to human health or tha environment. The Agency's TSCA
enforcement action is prophylactic; it is intended to pravant
potential health or environmental accidants from avar occurring.**
In tha Matter of Port of Oakland and Great Lakes Dredaa
and Dock Co.. NPRSA Appeal No. 91-1 (Final Decision and Order;
August 5, 1992): The Port and dredging company violated the
Marine Protection, Research, and Sanctuaries Act, and a permit
issued thereunder. "In order to establish the potential
environmental harm fro* the disposal of unpermitted sediments,
EPA need not prove that the sediments were in fact harmful, but
only that there suitability for ocean disposal had not been
determined as of the time of their disposal. Decided by the
Environmental Appeals Board.
In the Matter of: T H Agriculture and Nutrition Co.. Docket
No. TSCA VII-83-T-191 (Initial Decision; January 10, 1984).
Respondent improperly shipped for disposal contaminated waste
materials, in violation of "existing chemical" rules promulgated
pursuant to TSCA Section 6. Held: "It is the 'probability of
harm' or potential for harm and the risk inherent in the
violation as it was committed that is properly considered rather
than any actual harm that resulted from the subject violation."
*** In the Matter of: Millipore Corp.. Docket No. RCRA (3008)
11-85-0303 (Accelerated Decision; July 30, 1986) [Decision on
Remand; April 30, 1987] [Final Decision; December 2, 1987]: The
"issue to determine in assessing Respondent's illegal closure is
not whether exposure occurred from such closing, but rather the
potential for harm created by closing outside the prescribed
regulatory procedures. ... [A] violator is not to be rewarded
for luck where no actual harm can be proven to have occurred as a
result of the violation." Decided by Judge Finch.
Note: RCRA practitioners are advised to exercise caution in
relying on pre-October, 1990 administrative cases to
determine the "potential for harm" of present violations,
absent close analysis of the facts of both cases. Few
pre-1990 RCPP cases included multiday penalty components,
resulting in many cases with inadequate overall penalties
which failed to reflect the true gravity of the violations.
This may have promoted, in some cases, a determination of
"potential for harm" and "extent of deviation" of the
violations so as to compensate for the lack of multiday
penalties. Cases with facts roughly equivalent to prior
cases litigated today will usually warrant considerably
higher overall penalties due to the multiday penalty
component.
Note also: In determining the gravity of a violations, case
developers should always consider the specific facts at
hand, to ensure that violations of the same provisions by
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different companies receive appropriate penalties where, for
example, substantially different site conditions (e.g., the
presence at the facility of containment systems, safeguards,
and security systems) or quantities and toxicities of waste
exist. Otherwise, large, poorly-run facilities could
receive essentially the same gravity-based penalties as
small, very well-run facilities for violations of the same
provisions where the "potential for harm" is not identical.
Such a result is not contemplated by the RCFP.
GRAVITY OF THE VIOLATIONS - RISK TO HUMANS AND THE ENVIRONMENT
*** In the Matter of Stallworth Timber Company. Inc.. RCRA
(3008) Appeal No. 89-1 (Order Denying Review; July 11, 1991):
Action against company for violating surface impoundment
"freeboard" operating standards (40 CFR S 265.222). Held:
Initial decision assessing $25,000 "major-major" penalty
affirmed. The Presiding Officer correctly determined that the
absence of adequate freeboard poses a "major" risk of harm
because of the "increased chance of spillage, the proximity of
the area to waters of the United States, and the area's tendency
to receive large areas of rainfall," and appropriately took into
account that the Region's inspector had observed freeboard
violations on more than one occasion. The Chief Judicial Officer
(CJO) further rejected the Respondent's argument that its penalty
should only have been $1,000 because the $25,000 penalty actually
assessed was substantially higher than those assessed in similar
cases, stating: "The penalty amounts assessed in the [other 2]
cases ... are irrelevant to determining an appropriate penalty
here because the circumstances of both of those violations differ
substantially from those alleged here." The other cases involved
storage tanks, rather than surface impoundments, and therefore
posed different risks. Decided by the CJO.
*** In the Matter of: Martin Electronics. RCRA Appeal No. 86-1
(Order on Sua Sponte Review; June 22, 1987): The CJO assessed
the "potential for harm" for the failure to notify EPA of a Part
A permit revision at the low end of the moderate/moderate cell.
The Respondent generated only 200-250 gallons of solvents per
year, and had notified EPA of other waste activities so that EPA
was at least aware that Respondent generated and stored hazardous
wastes other than spent solvents.
*** In the Matter of: Elwln G. Smith Division. CvcIqps
Corporation. Appeal No. 86-6 (Final Decision; August 14, 1990):
Respondent had stored over 2,000 drums of flammable hazardous
wastes in deteriorating drums. The CJO determined, among other
things, that: (1) the failure to maintain adequate aisle space
presented a "major" potential for harm because emergency access
to the barrels was blocked, increasing the possibility of a major
fire of spill (there was ^extremely narrow spacing of at least
some of the drums"); and (2) the failure to store hazardous waste
in good condition and prevent leaks also presented a "major"
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potential for harm as there could have been a disaster had
exposed flammable wastes ignited. An essential element of EPA's
proof of the latter violation was the inspector's testimony that
he saw at least half a dozen drums leaking, while others were in
a deteriorated condition. The Court also noted that the
violations had persisted for some time despite repeated warnings.
*** In the Matter of; ROI Development Corp.. Docket No. RCRA
(3008) VIII-90—12 (Initial Decision; March' 31, 1994): On June
26, 1990, Region 8 filed a complaint under the 1984 RCRA penalty
policy alleging 3 separate RCRA violations. The violations all
resulted from a single, 1988 shipment of 100 gallons of 1,1,1,
trichloroethane (TCE) to a non-Subtitle C disposal unit. The
Region charged the Respondent with causing the illegal disposal
of hazardous waste (Count I), improperly characterizing the waste
on its manifest (Count II), and failing to notify the receiving
facility of the appropriate LDR treatment standard (Count III).
The Region sought single-day penalties of $25,000 apiece (i.e.,
major-major violations at the top of the respective matrix cells)
for these violations. For each violation, ALJ the lowered the
potential for harm from "major1* (as proposed by Region 8) to
"moderate." The Judge found that TCE is harmful to human health
and the environment and that its illegal disposal posed a
likelihood of exposure, but because only 100 gallons of waste
were involved, he did not view the potential for harm to be
"major." He rejected Region 8's argument that potential for harm
should be set by reference to the overall condition of the
receiving facility, holding instead that "Respondent is strictly
liable only for the potential for harm of its illegal shipment
under the RCRA program ..." Decision at 30. For Count II
(manifest violation), the ALJ noted that while Respondent's
manifest had been improperly completed, Decision at 35, the
shipment included a manifest as well as an MSDS. Decision at 36.
For Count I (illegal disposal), the ALJ assessed the penalty at
the bottom of the moderate-major cell, based on the relatively
low volume of waste involved in the violation.
*** In the Matter of; Millipore Corp.. Docket Ho. 1CRA (3008)
11-85-0303 (Accelerated Decision; July 30, 1986): Factors in
determining the appropriate GBP in this case included the "types
and quantity of waste involved ... " (in this case, 50 drums of
waste lacquer, 5 drums of waste solvent, and 45 drums of used
oil, plus any additional wastes generated in closure). see
Appeal No. 86-7 (Final Decision; December 2, 1987): On appeal,
the CJO reduced the "probability of harm" determination from
"major" to "moderate," holding inter alia that "the Region does
not furnish any explanation of how the *nature and quantity' of
the waste [alone] create[d] a substantial likelihood of
exposure." The Court noted that Millipore had submitted a
closure plan (albeit flawed), was replacing the old facility with
a new facility at the same site, and had consulted with the
Puerto Rico Environmental Quality Board about the closure. These
factors all lessened the likelihood of exposure. Decided by
Judge Finch.
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*** In the Matter of: Sandoz. Inc.. Docket No. RCRA (3008)
84-54-R (Initial Decision; October 31, 1985), aff'd. Appeal No.
85-7 (Final Decision; February 27, 1987): The ALJ balanced the
"rather high" quantities of waste involved in the violation with
the Banner in which the subject impoundment was constructed ("an
above average threshold of protection"). In this action
involving groundwater monitoring violations, the ALJ determined
that the fact because the Respondent's groundwater monitoring
system still provided some protection despite its deficiencies,
the violations posed a "moderate" rather than a "major" potential
for harm. Decided by Judge Yost.
*** In the Matter of: Aero Plating Works. Inc.. Docket No. RCRA
(3008) V—W—84—R-071—P (Initial Decision; February 13, 1986): In
this case, the ALJ found that "some firm evidence showing
precisely what quantities of hazardous waste were involved and
for what periods of time" was missing from the record. In the
absence of this evidence, though he determined that some
violations began in 1981, the ALJ placed all of the numerous
violations (including "operating without a permit or interim
status") in the "minor" potential for harm GBP category. The ALJ
held the father and son owner/operators of the plating firm
jointly and severally liable for an $18,500 penalty, and also
required the son to pay an additional $3,500 penalty. Decided by
Judge Harwood. (cont.)
Note: In a followup case, United States v. Maiorano. No. 87
C 4491 (N.D. 111.; January 8, 1990), reprinted In 20 ELR
20444, the District Court increased the penalty against the
Aero Plating Works owner/operators to $100,000, based on
their continuing recalcitrance.
*** In the Matter of Fair Haven Plastics. Inc.. et al.. Docket
No. RCRA V-W-88-R—005 (Initial Decision; May 3, 1989):
Respondent failed, inter alia, to file a Part A (i.e., it
operated without interim status or a permit. The "potential for
harm" was classified by the ALJ as "moderate," and the penalty
was assessed as the low end of the applicable GBP matrix cell,
because the quantity of waste accumulated since 1978 averaged
only about 5.8 drums (320 gallons) per year. In addition, any
threat to human health and the environment was ameliorated by the
fact that the wastes were contained in drums inside an on-site
trailer. In re: A.Y. McDonald Industries was distinguished. In
that case, McDonald's illegal operation was deemed to present a
"major" "potential for harm," where the company had dumped more
than one million pounds of waste at the site over five years, and
site security was poor if not nonexistent. Decided by Judge
Frazier.
In the Matter of Port of Oakland and Great Lakes Dredge
and Dock Co.. MPRSA Appeal No. 91-1 (Final Decision and Order;
August 5, 1992): The Port and dredging company violated the
Marine Protection, Research, and Sanctuaries Art, and a permit
issued thereunder. "Where the Region has made a permit
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determination under the MPRSA that particular ¦•diatntc are
unsuitable for ocean disposal, their potential to cause
environmental harm has been established and will be assumed once
exposure or potential for exposure exists." Cited in support of
this holding were In the Matter of Briaaa t Stratton. TSCA Appeal
No. 81-1 (February 4, 1981) (unnecessary to introduce evidence of
the toxicity of PCBs in a proceeding to assess a civil penalty
for PCB rules violations), and In tha Matter of A.Y.
McDonald. RCRA (3008) Appeal No. 86-2 (July 23, 1987) (the
toxicological effect of material identified by regulation as
hazardous waste should not be evaluated in determining the
potential for harm of the waste for penalty purposes because
"once a waste is deemed hazardous under the regulations, its
potential danger has been established." Decided by the
Environmental Appeals Board.
GRAVITY OF THE VIOLATION - HARM TO THE RCRA PROGRAM:
Note: In assessing GBPs under the 1990 RCPP where "harm to
the RCRA regulatory program" is a key consideration, care
should be taken also to analyze the potential harm to health
and the environment from the violations. Regardless of
which impact is considered more severe, the litigation team
should always be prepared to demonstrate not only how the
violation impacts an important RCRA program, but also why
the program itself is important. Explaining the health and
environmental risks the program is designed to address, and
showing how noncompliance with the program increases the
likelihood of these risks occurring, are effective ways to
accomplish this result. Citing to the relevant rule
preamble and supporting documentation, and presenting expert
testimony from the EPA staff responsible for implementing
the program, are both appropriate techniques in litigation.
•** In the Matter of: A.Y. McDonald Industries. Inc.. Appeal No.
RCRA (3008) 86-2 (Final Decision; July 23, 1987): Held: ALJ's
characterization of. the potential harm as "moderate" increased on
appeal to "major". "The notification and permitting requirements
are crucial to the effective enforcement of RCRA. ... [T]he
failure to file the notification and to apply for a permit or
qualify for interim status had the effect of concealing' from the
EPA Respondent's existence and the nature of the hazardous waste
operations. ... In other words, the notification and permit
requirements go to the very heart of the RCRA program. If they
are disregarded, intentionally or inadvertently, the program
cannot function."
*** In the Matter of: Grumman St. Augustine Corp.. Docket No.
RCRA 87-18-R (Initial Decision; May 10, 1989): Respondent
aircraft paint stripper failed, among other things, to submit a
Part B permit application. Held: "[T]he permit application
forms an essential part of the Agency's ability to regulate
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hazardous vast* ... Without this vital information, the Agency
ia severaly hampered in ita ability to oparata a 'cradle to
grave' program which the atatute and regulations require."
Decided by Judge Yost.
*** In the Matter of: Mlllipore Corp.. Docket No. RCRA (3008)
11-85-0303 (Initial Decision; July 30, 1986): The ALJ determined
that the "Respondent, through its illegal cloaure, has succeeded
in by passing [sic] the entire closure procedure required by the
regulationa. These avoided procedures include Agency comment and
superviaion over such details as systems and devices necessary
for [groundwater protection, equipment decontamination, etc.]."
"Closure or partial closure of any hazardous waste facility
without an approved closure plan successfully avoida the entire
regulatory procedure for closure and, thus, clearly has a
substantial [i.a., "major"] adverse effect on the regulatory
procedure for implementing closure." On appeal, however, see
Appeal No. 86-7 (Final Decision; December 2, 1987), the CJO
reduced the "potential for harm" determination to "moderate"
because, although Millipore hadn't consulted with the government
prior to closure, it had submitted a plan that met RCRA
substantive requirements and did communicate with the appropriate
officials "after the fact." Decided by Judge Finch.
The Marlev Cooling Tower Co.. Docket No. RCRA-09-88-0008
(Decision and Order; November 30, 1989): Respondent failed to
submit updated financial assurance documentation for 1986 and
1987, but had actually maintained the required financial
assurance. The ALJ found the likelihood of harm to be
"inconsequential," since funds were available for closure and
post-closure, but classified the "potential for harm" from the
violation as "moderate" due to the disruptive effect of the
violation on the RCRA program. Decided by Judge Greene.
*** In the Matter of; Elwin G. Smith Division. Cvclops
Corporation. Appeal No. 86-6 (Final Decision; August 14, 1990):
The Respondent appealed the ALJ's determination that its failure
to file a revised Part A application regarding capacity presented
a "major" potential for harm because of the RCRA program's
dependency on accurate information. The Respondent argued that
it had simply made a typographical error (typing 10,000 rather
than 110,000 gallons). The CJO affirmed the ruling, noting among
other things that approvals of applications for capacity
increases at other facilities under 40 CFR S 270.72(b) would
depend in part on the information in agency files about the
available capacity at Respondent's facility.
EXTENT OF DEVIATION:
Note: The function of the "extent of deviation" factor is
to reflect the degree to which the violation renders
inoperative the violated requirement on amy given day. The
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duration of the violation over time should be addressed
through tha multiday penalty component, not the "extent of
deviation." Pre-October, 1990 penalty cases lacking
multiday penalty components do not always respect this
distinction.
*** In the Matter of; Grumman St. Augustine Corn.. Docket No.
RCRA 87-18-R (Initial Decision; Nay 10r 1989): "... Respondent
kept its percolation pond in operation for 240 days without a
permit and after the time it was required by the law to close.
Additionally the Respondent did not certify compliance with
groundwater monitoring or financial responsibility requirements
..., and ... the closure plan submittals were totally
inadequate." All of these factors were held to "clearly
demonstrate a major extent of deviation as the violations above
specified ..." Decided by Judge Yost.
*** In the Matter of Fair Haven Plastics. Inc.. et si.. Docket
No. RCRA V-W-88-R-005 (Initial Decision; May 3, 1989): (l)
Extent of deviation deemed "major for each of these violations,
where the Respondent (1) failed to file a Part A, altogether;
(2) failed to obtain an EPA ID Number until after the filing of
the Complaint; (3) failed to mark any of its drums; (4) did
nothing to meet, even partially, the requirements for a personnel
training program; and (5) developed no contingency plans at all.
Decided by Judge Frazier.
*** In the Matter of Environmental Protection Corporation.
Docket No. RCRA-09-86-0001 (October 24, 1909; Decision and
Order): Where the Respondent met some of the requirements of
RCRA Section 3007(a) by responding promptly to EPA's request for
documents, by supplying some of the documents, and by offering
its rationale for not submitting the remainder of the documents,
the "extent of deviation" of the violation was deemed "moderate."
Decided by Judge Vanderheyden.
*** In the Matter of: Ashland Chemical Company. RCRA (3008)
Appeal No. 87—17 (Final Decision; November 15, 1989): In his
Initial Decision, Judge Nissen had determined the "extent of
deviation" of Respondent's storage of hazardous waste without a
permit to present a "major extent of deviation." On appeal,
Ashland argued that it should be "moderate" because it had
previously submitted a Part A permit application (withdrawn prior
to the onset of the violation). The CJO affirmed the "major"
"extent of deviation" determination, as well as the ALJ's
accounting for the actions in the form of a "good faith efforts"
adjustment to the GBP.
*** In the Matter of: Elwin G. Smith Division. Cvclops
Corporation. Appeal No. 86-6 (Final Decision; August 14, 1990):
Where the ALJ found the EPA inspector's testimony credible that
the Respondent had packed waste drums into an aisle so that he
had to stand sideways to go between them and that there was
inadequate aisle space for towmotors to pass, the "extent of
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deviation" of the Respondent's failure to maintain adequate aisle
space was correctly determined to be "major." The CJO likewise
affirmed the ALJ's ruling that the Respondent's failure to store
hazardous wastes in containers in good condition and prevent
leaks presented a "major" "extent of deviation." The EPA
inspector had testified that he saw "about half a dozen drums
actually leaking, while others were in deteriorated condition."
Respondent's argument that where only a small percentage of its
2,000 drums were actually leaking, the "extent of deviation"
should not be "major," was rejected. The leaks, according to the
CJO, "were an actual harm to the environment since waste reached
the ground, and could have led to a disaster if the exposed
flammable waste had been ignited ..." On the other hand, where
"Respondent had filed a Part A application but had simply failed
to revise it to be consistent with the actual capacity of the
facility," the "extent of deviation" was "moderate."
In the Matter of Brunswick Mercury Marine Plant, Docket No.
RCRA VI-433-H (Initial Decision; July 31, 1990): (1)
"[Respondent's waste analysis plan included some of the
information required by the regulation, but ... three specific
requirements were not included. This failure is sufficient to
constitute a moderate deviation from the regulatory framework."
(2) "Respondent's inspection log, while not a complete inspection
schedule, included [a] substantial portion of the total
information required. Certain information ... was not included,
such as an inspection schedule for particular equipment. This
constitutes [a] moderate deviation from the regulatory
framework." (3) "[W]hile the personnel training records do not
show that hourly employees received training, they did include
some of the required information. ... [B]ecause a significant
portion of the required information was present, it is found that
the ["extent of deviation" is moderate]." (4) Respondent's
closure plan violation "is a minor deviation from the regulatory
requirements, the only violation established having been failure
to include an estimated year of closure." (5) Respondent had
serious groundwater monitoring violations, but had installed a
system and measured the parameters it thought applied. The ALJ
concluded that the "extent of deviation" fell midway between
"major" and "moderate," and assessed a commensurate penalty.
Decided by Judge Greene.
MULTIDAY PENALTIES:
Note: Multiday penalties were rarely proposed under the
1984 penalty policy. Consequently, with the exception of
the Initial Decision in the Harmon Electronics case, which
has not yet been incorporated into this outline, there are
no identified RCRA administrative decisions addressing
multiday penalties under the 1990 RCPP. The following case
summaries describe RCRA civil judicial cases where multiday
penalties have been imposed.
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In the Matter of Dr. Marshall C. Saasar. Docket Mo. 404-89-
102 (Initial Decision; July 30, 1991): Respondent held liable
for filling a wetlands without a permit in violation of Clean
Water Act Section 404, and penalized $125,000. The Court's
analysis indicates that it viewed the violation to be
"continuing" (though the violation technically consisted of the
"discharge" of fill materials, the subsequent failure to correct
the violation resulted in a "continuing" violation for penalty
assessment purposes).
*** ,In re; Cypress Aviation. Inc.. RCRA (3008) Appeal No. 91-6
(Order Dismissing Notice of Appeal; January 8, 1992): RCRA staff
may be familiar with this Region 4 action, which raised the
issue of whether the illegal land disposal of LDR wastes is a
"continuing violation" for which multiday penalties may be
assessed. In his Initial Decision, Senior ALJ Harwood assessed
single-day penalties only, but for evidentiary and other reasons
(including the fact the decision did not refer to the 1990 RCPP),
Region 4 did not appeal. Iri the Order on appeal, the CJO
dismissed the Respondent's Notice of Appeal as untimely. Decided
by Judge Harwood.
Note: Regions obtaining a similar decision, in a future
case with analogous facts, , are requested to contact the RCRA
Enforcement Division to discuss the possibility of an
appeal.
*** U.S. v. Ekco Housewares. Inc. (N.D. Ohio): On January 28,
1994, the United States obtained a $4.2 million penalty judgment
in this matter based on Ekco's failure to maintain financial
assurance for closure, financial assurance for post-closure, and
liability coverage. In its complaint, the U.S. cited violations
of both a 1987 Partial Consent Agreement and Order (PCAO), and
RCRA rules (including financial assurance and liability insurance
provisions in 40 C7R SS 265.143, .145, and .147). Ruling in the
government's favor on all counts, the Court assessed $1000/day
multiday penalties for 4,606 days of violation, resulting an
overall penalty of $4,606,000.
*** U.S. v. T & S Brass and Bronze Works. Inc.. 681 F.Supp. 314
(D.S.C. 1988), aff'd in part and vacated in part. 685 F.2d 1261
(1988): Defendants continued to operate hazardous waste surface
impoundments after losing interim status. The Court imposed a
civil penalty of $l,000/day, for a total of $194,000.
*** U.S. v. Environmental Waste Control. 710 F.Supp. 1172, 1142-
1145 (N.D.Ind. 1989), aff'd 917 F.2d 327 (7th Cir. 1990):
Defendants continued to operate a hazardous waste landfill after
losing interim status, had an inadequate ground water monitoring
system, and placed waste in unlined cell in violation of the
minimum technology requirements. The Court imposed a civil
penalty of $2,000/day, for a total of $2,788,000.
ccsr
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U.S. v. Vineland Chemical Co.. 31 ERC 1720 (D.N.J. 1990):
Defendants continued to operate two surface impoundments after
losing interim status. Finding inter alia that the defendants
acted in bad faith in Misleading EPA and NJDEP in conducting
certain closure activities without prior notice, the Court
imposed a penalty of $1,000/violation/day, for a total of
$1,223,000.
In the Matter of Ashland oil. Inc.. SPCC Appeal No. 91-1
(Final Decision; September 15, 1992): Ashland failed to prepare
and maintain a Spill Prevention Control and Countermeasure Plan,
for one of its facilities by not disclosing the location and/or
existence of certain tanks. The Environmental Appeals Board
affirmed the ALJ's ruling that per day penalties were appropriate
for the time period during which Ashland failed to amend its
Plan.
U.S. V. Trident Seafoods Corp.. No. C92-1025D (Order;
December 13, 1993) at 5-6: "Trident argues that its failure to
give written notice [of a demolition, pursuant to NESHAP
requirements] should be regarded as a single violation of a
single day [sic]. There is no clear law on this point. The
government refers to an administrative decision, In re Coastline
Purchasing Corp.. 1992 RCRA Lexis 21 (failure to give notice
under [RCRA] resulted in fine for each day notice was not given).
... [T]he Court agrees with the government's position, given the
self-evident purpose of notification to enable the enforcement
agency to monitor asbestos removal and assure [sic] effective
compliance with work rules. ... The Court concludes as a matter
of law that failure to comply with the notice requirement is a
continuing violation, ending only when renovation is completed or
EPA has actual notice."
*** U.S. v. MIDC (aka William Florel (3rd Cir.; December 20,
1993): The Court affirmed a lower court ruling assessing a
$480,000 civil penalty for violations of a RCRA Section 3013
(Monitoring, analysis, and testing) Order. Section 3013(e)
authorizes penalties of up to $5,000 per day for such violations.
The Flore Court, which assessed multiday penalties of $2,000 per
day for 240 days of violation, expressly rejected a defense that
"[other] lost cases ... have imposed a penalty in the range of
[only] about $1,000 per day."
ECONOMIC BENEFIT OF NONCOMPLIANCE:
*** United States, et al. v. Production Plated Plastics. Inc..
et al.. File No. K87-138 CA (W.D. Mich.): The Defendants in this
case operated unpermitted seepage lagoons, delayed submission of
closure and groundwater monitoring plans, failed to comply with
RCRA's financial assurance and liability provisions, and did not
implement their groundwater plan. In addition, the Defendants
cu
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never complied with RCRA's financial assurance or financial
liability provisions. The Court deened the Defendants to have
received an economic benefit of noncompliance (EBN) of at "least
$1 million through their failure to comply with the statute."
*** A.Y. McDonald Industries. Inc.. RCRA Appeal Mo. 86-2 (Final
Decision; July 23, 1987): The CJO held that "the economic
benefit component should include only the cost of the cheapest
mode of compliance." The CJO added, however, that EPA is not
required to "prove (in its prima facie case) that every
conceivable compliance alternative would have been more costly
than the only one on which the economic benefit calculation is
based." Rather, EPA may satisfy its burden of going forward by
demonstrating the cost of a reasonable compliance option. The
burden would then shift to the Respondent "to produce evidence"
on available cheaper compliance options. In this case, the CJO
determined that EPA's engineer's testimony was sufficient to
establish a prima facie EBN case. The CJO also held that "good
faith" efforts are irrelevant to the EBN determination.
*** In the Matter of: Grunnnan St. Augustine Corp.. Docket No.
RCRA 87-18-R (Initial Decision; May 10, 1989): "The Respondent
argued that the Agency's [BEN] calculations were in error because
an alternative to the scenario proposed by the Agency witness,
the Respondent could have bought a truck and used one of its own
employees to drive it rather than hiring a transporter as was
done [sic] by the Agency's witness. ... The regulations and
penalty policy are clear that if a Respondent wishes to contest
the economic benefit adjustment provided by the Agency, ... it
has a burden to come forward with documentation to demonstrate
how and in what particulars the Agency [was] in error in its
calculations. In this instance, the Respondent did not submit
any documentation ... [A]bsent such documentation the Agency's
calculations and estimates should be accepted unless there is
some showing that they mis-applied the formula or requirements of
the penalty policy." Decided by Judge Yost.
*** In the Matter of Federal Hoffman. Inc.. Appeal No. 87-15
(Final Decision; November 15, 1989): EPA's EBN computation for
placing liquid wastes in a landfill lacking a liner was assessed
in full, where the Respondent made no attempt to rebut it.
In the Matter of! Sandoz. Inc.. Appeal No. 85-7 (Final
Decision; February 27, 1987): In this case, EPA introduced
evidence of EBN using national data on expenses incurred by
industries in complying with RCRA's groundwater monitoring
requirements. The violator countered with credible company-
specific data indicating lower-than-average cost savings, which
EPA did not refute. Therefore, the CJO assessed the lower
amount. The CJO added, "I express no opinion as to whether a
penalty component premised on a national model of compliance
costs, standing unrebutted, would satisfy EPA's burden of proving
the proposed penalty was appropriate."
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**• In the Matter of: RQI Development Corp.. Docket No. RCBA
(3008) VIII—90—12 (Initial Decision; March 31, 1994): On June
26, 1990, Region 8 filed a complaint under the 1984 RCRA penalty
policy alleging 3 separate RCRA violations. The violations all
resulted from a single, 1988 shipment of 100 gallons of 1,1,1,
trichloroethane (TCE) to a non-Subtitle C disposal unit. The
ALJ refused to assess the $1660 in EBN calculated by Region 8.
This amount consisted of the cost of disposing of the 100 gallons
of TCE at a permitted landfill. The Judge held: "Complainant's
calculation of economic benefit to ROI is flawed since there ia
no indication of the cost to RQI of the actual disposal aa an
offsetting factor, so it cannot be established that the
Respondent gained any economic benefit from its violations."
Decision at 38 (emphasis added). Decided by Judge Head.
Note: A similar issue was appealed by EPA to the EAB in a CAA
administrative action, In re: Burlington Northern
Railroad Company. CAA Appeal No. 93-3 (Final Decision
and Order; February 15, 1994). In Burlington Northern,
the EAB modified the ALJ's Initial Decision by striking
language in the Initial Decision purporting to credit
towards EBN costs which had not contributed to
compliance. Because the ALJ had assessed statutory
maximum penalties even without the EBN, however, the
EAB declined to address the merits of the issue.
U.S. v. Roll Coater. Inc.. Cause No. IP 89-828 C (Order Following
Bench Trial; March 22, 1991): CWA case (violations of
pretreatment standards): The Court rejected EPA's BEN discount
factor (capital asset pricing model). The Court accepted the
defendant's discount factor (weighted average costs of capital).
The EBN component of the penalty should reflect the cost of the
least expensive compliance alternative.
*** In the Matter of: Sandoz. Inc.. Docket No. RCRA (3008)
84-54-R (Initial Decision; October 31, 1985): No consideration
of either good or bad faith should enter into the EBN
calculation. Decided by Judge Yost.
ADJUSTMENT FACTORS:
1. GOOD FAITH/LACK OF GOOD FAITH:
•** United States, et al. v. Production Plated Plastics. Inc..
et al.. File No. K87-138 CA (W.D. Mich.): The Defendants in this
case operated unpermitted seepage lagoons, delayed submission of
closure and groundwater monitoring plans, failed to comply with
RCRA's financial assurance and liability provisions, and did not
implement their groundwater plan. The Court noted that, since
1986, the Defendants had expended over $4.5 million cleaning up
the facility, as well as $500,000 per year operating a purge and
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22-
treat aystea for the year* the system was operational.
Nsvei?tli«l®a§s, the violations occurred despite the fact that the
Defesiaanti* "w«?e well aware of the various RCRA deadlines."
Thus, "any Kgo©d faith" exhibited by these expenditures was
counterbalanced by the "numerous occasions defendants have
purposely thwarted the effectiveness of the statute." These
included Defendants' failure to act in good faith to raise the
necessary fuMa to clean up the facility.
£*« In the Matter of: A.Y. McDonald Ind-jsfcr laa. Inc.. RCRA
Appeal No. 86-2 (Final Decision; July 23, 1987): The CJO reduced
the Mai's 25% "good faith" adjustment for one count to 5%, ruling
that while the violator had self-reportad its failure to notify
EPA of hasardous waste activity, it did so only through its
notification efforts for a new facility. "[Significant
reductions should be reserved for those cases where the violator
promptly reports its noncompliance ... once discovered or
suspscted."
*a* In the Matter of: Omark Industries. Docket No. RCRA (3008)
85-10—09 (Initial Decision; January 6, 1937): In this case, th»
Respondent had a policy of requiring partially filled drums to
be checked by a chemist before disposal. The Respondent's
violation resulted from the company's failure to follow its own
policy in this instance. The ALJ reduced the proposed penalty
reduced by 25%, partially in recognition of this compliance
program. Decided by Judge Nissen.
**• In the Matter of: ROI Development Corp.. Docket No. RCRA
(3008) VIII-90-12 (Initial Decision; March 31, 1994): Region 8
filed a complaint alleging 3 RCRA violations resulted from a
single, 1988 shipment of 100 gallons of 1,1,1, trichloroethane
(TC£) to a non-Subtitle C disposal unit. In an effort to comply
with RCRA, ROI hired a contractor to dispose of its hazardous
w&sta, and its transporter actually completed its manifest.
While ultimately unsuccessful (and thus irrelevant to liability),
the ALJ viewed these actions as demonstrating "good faith efforts
to comply,56 and "lack of willfulness," respectively. He adjusted
ROI'a penalties accordingly. Decision at 33, 36. Decided by
Judge Head.
Public Interest Research Group of New Jersey. Inc. v. Powell
Duffryn Terminals. Inc.. No. 89-5831 (3rd Cir. 1990; August 20,
1990) at 34-35: The Court of Appeals reversed the District
Court's reduction of a GBP, due to "good faith", because of the
actions and/or non-actions taken by the Defendant due to the
USEPA's and the NJDEP's failure to act more diligently in making
defendant comply« The District Court had found that, had the
government acted properly, "the violations would have ceased long
ago. Therefore, these two governmental bodies are partially to
blame for the defendant's lack of compliance for the years at
issue." The Court of Appeals reversed: The "mere failure by
governmental agencies to prosecute an NPDES permit holder does
not allow a court to reduce a penalty." While there may be
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instances where a district court nay consider a government
agency's inaction and the permittee's reaction when setting civil
penalties "as justice"may require where a defendant has failed in
a good faith attempt to comply with its perait because of
technical or economic problems and the EPA has affirmatively
recognized and excused noncompliance", this was contradicted by
the record in PIRG which showed that "defendant, motivated,
possibly by greed or apathy, chose to procrastinate.*."
*** In the Matter of; Landfill. Inc.. RCRA (3308) Appeal No, 86-
8 (Final Decision; November 30, 1990): EPA charged the
Respondent with failing to maintain an adequate groundwater
monitoring system by improperly placing its wells. The
Respondent's defense was that EPA was estopped from alleging the
violation because the State had approved the location of .wells
prior to their installation. This defense was rejected for
purposes of liability, but the Chief Judicial Officer upheld the
ALJ's findings that, "the respondent installed the monitoring,
wells at their present location at great expense and with the
advice and complete approval of the State. The undersigned is of
the view that a nominal penalty of $250 should be assessed ..."
*** In the Matter of: Union Oil Company of California. Docket
No. RCRA-09-84-0223 (Initial Decision; January 14, 1985) ("[T]he
environmental problems arose in this case because of the mistaken
or erroneous action by the EPA and the State, and appears to have
been resolved promptly once the mistake or error was corrected.
Accordingly, it is concluded that no penalty should be assessed."
Decided by Judge Harwood.
*** The Marlev Cooling Tower Co.. Docket No. RCRA-09-88-0008
(Decision and Order; November 30, 1989): Respondent violated
RCRA, inter alia, by failing to demonstrate financial assurance
for bodily and property damage to third parties. One of
Respondent's defenses was that it in numerous discussions with
California officials regarding its closure plan no deficiencies
had been mentioned. The ALJ found that, "[w]hile ... lack of
knowledge is ordinarily not used as a basis for reducing,the
penalty, respondent's reliance upon guidance from [the State] is
evidence of its good faith, supporting a 25% reduction in the
gravity-based penalty." Decided by Judge Greene.
In re: General Electric Co.. Docket No. TSCA-IV-89-0016
(Order on Motions for an Accelerated Decision; August 30V 1990):
Evidence that EPA employees rendered erroneous advice held
relevant and admissible for purpose of determining the
appropriate penalty. Decided by Judge Nissen.
*** United States v. Lacks Industries. Inc.. No. G87-413 CA
(W.D.Mich.; June 22, 1990), reprinted In 32 ERC 1221: "[T]ha
Court concludes that civil penalties of $250,000.09 are
appropriate in the present case for a number of reasons. First,
the failure of Lacks to comply with RCRA is, to some degree, the
&7C
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result of its reliance upon representations made te it by MDNR
[State] officials [that the laooona were not subject to RCRA]."
U.S.mil Coatsr. Inc.. Cause Mo. IP 89-826 C (Order
Following* B^ctT-Trial; March 22, 1991): CWA case (violations of
pr«tr«atssant'- etaridards): Due to & lack of Effective
ceaiHiuaieat'i'oji- between EPA, defendant, arid the state (Indiana had
affir^atl^siry' recognized and excused noncompliance), no penalty
was-• vtofa&ei&L ¦' for time period prior 'to August 1988. The Court
found that, in delaying construction of plant while testing
technology &t another site, defendant exercised "good faith."
2. DEGREE OF WILLFULNESS AND/OR NEGLIGENCE
**a In the Matter of: Ashland Chemical Company. RCRA (3008)
Appeal- No. 87-0:7 (Final Decision; November 15; 1989): H...
Ashland proposes an additional 5% reduction based on the absence
of willful noncompliance. ... ' The record reflects no effort by
Ashland to obtain advice from OEPA or U.S. EPA as to whether its.
regulatory status had changed once its tanks becama contaminated
with water. Moreover, lack of knowladgsof the legal requirement
should not be used:to reduce a penalty for to do so might
encourage ignorance of; the law." Decided by the CJOc
*** In the Matter of: Standard Tank Cleaning Cbrp.. RCRA Appeal
No. 91-2 (Final Decision; July 19, 1991): Appeal of action
against company for failing to obtain-liability insurance for
accidental occurrences. In the underlying ^action, the Region had
proposed a penalty of $135,321.50, $110,312.50 of which was for
"e&ohosic benefit of noncompliance.^* , In his Initial Decisionf
Judgs'Vandarheyden found that "Respondent's conduct over a
protracted period of time ... displayed deliberate neglect,
indifference, or both," and increased the penalty to $145 ,313.
The CJ0 dismissed Respondent's appeal as untimely.
*** In the Matter of: Gordon Redd Lumber Company. RCRA Docket
No. 88-01-R (Initial Decision; May 30, 1991). EFA's complaint
alleged storage and disposal of hazardous waste without interim
status or & permit, and numerous other violations. EPA proposed
a $75,000 'penalty. The ALJ assessed a $20;000 penalty for
violations involving leaking garbage bags of K001 waste
det'ermiheid to constitute a hazardous waste management "facility."
The ALJ found, among other things, that "[a]lthough Mr. Redd is
certainly no Mother.Theresa of the environment, one can certainly
understand his confusion and frustration rvaulting from the
[inconsistent'! actions of the fState 1.K Decided by Judge Yost.
*** In the Matter of: National Coatings. RCRA Appeal No. 86-5
(Final Decision; January 22, 1988): The CJO determined that the
dumping incident was accidental and Respondent had no intent to
improperly dispose of the wastes. He therefore upheld the ALJ's
penalty reduction of 25% for lack of willfulness.
<°7!
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In the Matter of; Graminan St. Augustlne Corp.. Docket .K®'.-
RCRA 87-18-R (Initial Decision; May 10, 1989): Respondent
failed, inter alia. to submit.a Part B permit application;; The
ALJ determined, among other lyings, that the Respondent'ii fallure
to keep abreast of even the most minimal statutory and regulatory
requirements (it had .not even obtained up-to-date copies of. RCRA)
and correct its violations, despite repeated notice, from-,EPA*
evidenced negligence j^stifyiRg a 25% increase in the penalty.
Decided by Judge Yost .7
In the Matter of: Riverside Furniture Corn. EFCRA-88-H-VI-
406S (Initial Decision;.. Sept, 28, 1989). The penalty - Amount was
not reduced despite the fact that Riverside "did not have actual
knowledge" of EPCRA requirements. The ALJ held that Riverside is
"charged with knowledge of the United States Statutes at large."
Publication of 40 CFR ??2 in the Federal Register gay# Riverside
"legal notice of the '^C^;>d^ii3*A't;iSns". ¦ ¦ Decided by Judge Jbn«s
In the Matter of Port of Oakland and Great Lakes Dredge
and Dock Co.. MPRSA Appeal No. 9l-*.l (Final Decision and Order;
August 5, 1992): The J*ort and dredging company violated the
Marine Protection, Research, /and Sanctuaries Act, and a permit
issued thereunder. The Environmental Appeals Board adjusted its
gravity-based penalties forallthree of the dredging and
disposal violations*'upwar
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4. ABILITY,TO, PAY:
ctfi central Paints My shop, ire.. rcra
Decision;* Januar^l!*--. 1987.): "RCRA does
.nbt; i%cltdfr*^l.lity'to pay as onai. pt. $t*«iV;f actors that SPA wist
•con|i'd^Int:aij^iJi'ing a, penalty; abilityv.t.Ov.p«y i® not an
' •IfrttoMftf - EPfc; ®; proof,Respphdfejnt^- m proposwmt of a
rediifcti^i /ip, 'penalty' based on !£¦; f^Mn^la'l, eondition -,[has ] .the
bur dpi-'pf^prddlr^.fit thi«,..^|&^;vj^©.:R^^^d^t:/o arguments
that T.'t^djpul'Sh'' Jfcv afford th@. p®r»alty|; were 4®ea$d: unkiersuasive.
«arcaa:sr&T;<»a. et; ai. v. Production.-Platad Pl&atica. Inc..
Fili No. K87-138 CA (W.D. M}.ch.) Jr&f&T l*f piidanta in this
cas® operated unpermitted seepage lagoons, delayed submission of
clos^« a^d ^©u^wat^raoni^orihg plans, faH(^ |io; cdaply with
;JrC^!^$4%flpi»r^Wuro prpviaiosifl, and did" not
' i®Pxlfl3^meiji^J^n@ir groundwater plaji^ r lnc.aa®'«sffling a- $.1^5• Billion
psftil'ty^f9^';*ina ¦Viblati©hsl/.tho;cbi^,.y^jj^t«id. souniiy, th®.
Deferidantif * • primaiy. defense of: '?ihabiiity. to-, pay. ® T&m- .Court
scrutinized tl),e ,«viden<3enffidd«ced.at'•• toilalV;: including Defendant
Michael ©h^refedldsar) .personal. income'
jtax returns; ..and his" assets', in ,©8rtablishing
thai: .^f'and^ts. _hail^^eii,.f'inAniial7: ability^ not.,:;?mly tb? comply with
RCRa but ;to .pay^a'"''meaningful...penal'tyj as well'-.^Whi'le recognising
that "theJjbn&It^ e^talnly-larfath© Court
found tbit "Defendants currently have assets-wMch---can be
1 liquidated to satisfy the re<^irdients' df . this: Courtfe Judgment"
(estimated by the Judge to require ^roughly >$<<,5. million .in
expenditures). (Emphasis added), in acknowledging that the
I^efendant .^puljd likely need ^tp liquidate asset® to sitis.fy thCou^ coiiiidered# ^ohgiother things, the
availability of discretionary ..,as«et'B>- -D^f©ndants'^ investmenterin
spe<^la1^Y$i>25TOOO* The Court
determined".t&at 'tii« Respondent had th© l&bility; to j^ty" the full
a^sse^i«8i«ltyf .but permi tted hi® to^-pa^¦in installments
,beca£s®- ®iny.lpf;,his -assets .were.,.npn^liquicl (an .Ircnilc holding, •
"since 'tft£® :i® ;a\Xw®ter^-f,case),,'' lteci4f&r:by-Judge 'Yost. •
in thia Matter-oft Sporieldin-International. FIFEA Appeal Ho.
88-2 (Final Order; . June 4, 1991): Action against seller of
alleged sterilizing agent for, misbranding a peeticide and making
unauthorized claims. The CJO affirmed the Initial decision
assessing,a $10,000 penalty. Respondent may be assumed to have
a -penalty where JSPA-aliagee it can pay and the
.-'challenge the allegation.
<-72
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In the Matter of; Timothy R. Ward. TSCA-VII-8£-T-635,
(Initial Decision; November 24, 1987): ., Inthis"
the improper & rural-
that the requirement that5 the Agency eohei^^':'-yi»Mil^
assessing penalties' *shtiuld^ Wt • suggest or imply rn&t paymeh&.of
the penalty asses'aed^ii-l-^be; without pain or $^rl& ,Wi$h'' cowi'le^e
facility; rather; 'it Itfioul'dP 1>« iiv" ouch amount that Ju&Dpndfmt:;;
and others similarly ai^tu^ted/^vill chooi* to'
pertinent regtal/abitolStfj# plr&mui^a^ed for the protection,, ofJt&m
public, rather . than pay- "afr' appropriate penalty.v Th^#:caite' is:
significant in that it supports the proposition that, civil;
penaltieo shouldh&veS ah aconbale impact
Decided by Judge 'JOnisv
October-iS, .1987-.)/-s.^Y'T^ i&J*- ir^well^thi*:'yiolAtbr #Wy Jte jEMI* •
basedv on.' inter ^}i-rrCtti^lpSjlSij^ jG&QT
deterained that ^^^RlS^i6ndehtss^tthvefi'f|e4 '^laifeie' s|&ti :&np'
shop- manager' a uncorrobbrated£e3tim6ny, standing aloiie # Were
inadequate to demonstrate'"in&bility to gay." ^Likewise, i|nsworn
assertions - by cOuns&l- fiif^Risp^fi&ifit^efir enti¥fSd to "tip,: weight.
The CJO •'d&^eriiine&i®fii&jlre^fif|JMfiJtBBoidwhole,
F kv K?desei^efact|3^fis
to reflect "litigation-risks" in settle^ht5;-- -hence th¥r«^aire
relatively few decisions where it plays « significant role
in the penalty determination. The importance of this factor
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mfcy iaer«M« in the future if, as,« policy utt«r, KPA
relies upon it to help implement ®Reinvention of
Environmental ^Protection" initiative© involving auditing,
small businesses, and other penalty-related matters.
mmfr for the Matter of; ROI Development Corn.. Docket Mo. RCRA
(3008) ytlI-90-12 (initial Decision? March 31, 1994): Region 8
cpmplaintalleging 3 RCRA violations*resulted from a
.,1988 shipment of 100 gallons ofl,1,1, trichloroethane
€eT.a- non-Subtitle C disposal'unit, the ALJ reduced.the
' :'s penalty based, among other things, on; the fabt that
** i^diipoaal'' in .question was a one-time transaction, consisting
the disposal of waste accumulated, froia amanuffeaturing process
"had beess discontinued, in favor ol a process'which yields
nir h&z'ardous waste." The Judge held that "[tjfeis voluntary
^^B^e Constitutes more than merely coming into coapliance with
RCKft x^Srements and Respondent should receive credit for it
by a dowirewir® adjustment 6f: the penalty.* Decision at 34.
«*• in ffifr-fWiffiwg Appeal no. 86-7
(Final Decisimf; December 2, 1987): The CJO reduced the
Respondent'® by 40% to reflect, In^er alia, the "unusual
circuHstfcinces'f ©f tte# Puerto Rico Environmental Quality Board
failing to1 follow its' &kn rules by not responding to the
Respondent'# proposed closure plan in a timely fashion (the delay
had contributes! to the severity of thi violation);
In th
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