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U.S. ENVIRONMENTAL PROTECTION AGENCY
OFFICE OF INSPECTOR GENERAL
Catalyst for Improving the Environment
Evaluation Report
EPA Needs a Better Strategy to
Identify Violations of Section 404
of the Clean Water Act
Report No. 10-P-0009
October 26, 2009
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Report Contributors:
Ira Brass
Dan Engelberg
Byron Shumate
Danielle Tesch
Andre von Hoyer II
Michael Wagg
Abbreviations
§404 Section 404 of the Clean Water Act
Corps U.S. Army Corps of Engineers
CWA Clean Water Act
EPA U.S. Environmental Protection Agency
FLA Field Level Agreement
FWS U.S. Fish and Wildlife Service
FY Fiscal Year
MO A Memorandum of Agreement
NRCS Natural Resources Conservation Service
OECA Office of Enforcement and Compliance Assurance
OIG Office of Inspector General
OWOW Office of Wetlands, Oceans, and Watersheds
Cover photos:
From left to right: A cooler turtle in Juniper Creek, Ocala National Forest,
Florida; a great egret in Robinson Bayou, Panama City, Florida; and
pickerelweeds in Juniper Creek, Ocala National Forest, Florida.
(EPA OIG photos)
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U.S. Environmental Protection Agency
Office of Inspector General
At a Glance
10-P-0009
October 26, 2009
Catalyst for Improving the Environment
Why We Did This Review
We conducted this evaluation
to assess the U.S.
Environmental Protection
Agency's (EPA's)
effectiveness at identifying
violations of the Clean Water
Act (CWA) Section 404
(§404) that fall under its
enforcement authority.
CWA §404 regulates the
discharge of dredged or fill
material into wetlands and
surface waters.
Background
Wetlands, lakes, streams, and
other surface waters provide a
variety of benefits, including
pollution reduction, flood
protection, erosion control,
and critical habitat for
wildlife. EPA has the lead
enforcement role for flagrant
or repeat violations involving
cases where the violator has
not applied for a valid §404
permit from the U.S. Army
Corps of Engineers.
For further information,
contact our Office of
Congressional, Public Affairs
and Management at
(202)566-2391.
To view the full report,
click on the following link:
www.epa.qov/oiq/reports/2010/
20091026-10-P-0009.pdf
EPA Needs a Better Strategy to Identify
Violations of Section 404 of the Clean Water Act
What We Found
EPA lacks a systematic framework for identifying the §404 violations for which it is
responsible under a 1989 Memorandum of Agreement. Primarily because of its
limited field presence related to §404 violations, EPA identifies violations through a
passive, reactive method of relying on complaints and referrals from external
sources. An incomplete national data system and sporadic coordination with federal
and State partners further impair EPA's ability to maintain an effective §404
enforcement program.
EPA must develop a framework that includes a §404 enforcement strategy that
includes such elements as: increased communication/coordination with
enforcement partners, a system to track repeat and flagrant violators, performance
measures, and cross-training. Without an effective framework or strategy, EPA
cannot be assured that it is sufficiently protecting wetlands and other surface waters
from §404 violations involving dredged or fill activity. Further, the current system
does not provide EPA with the necessary inputs to make informed decisions about
the allocation of resources for §404 enforcement.
What We Recommend
We recommend that the Assistant Administrator for Enforcement and Compliance
Assurance, in consultation with the Assistant Administrator for Water, develop and
implement a comprehensive CWA §404 enforcement strategy addressing issues
discussed in this report (such as communication with enforcement partners and a
system to track violations). We also recommend that the Deputy Administrator
revise the 1989 Memorandum of Agreement in collaboration with the Assistant
Secretary of the Army for Civil Works.
The Agency agreed to develop and implement a comprehensive CWA §404
enforcement strategy. Although the Agency believes the enforcement strategy will
clarify how it collaborates with the U.S. Army Corps of Engineers and processes
referrals, and therefore may not require the 1989 Memorandum of Agreement be
revised, we retained the second recommendation because we still believe this
agreement should be revised. We consider both recommendations undecided.
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o
. 2
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
OFFICE OF
INSPECTOR GENERAL
MEMORANDUM
SUBJECT:
FROM:
TO:
October 26, 2009
EPA Needs a Better Strategy to Identify Violations of Section 404
of the Clean Water Act
Report No. 10-P-0009 , ,
Wade T. Najjum
Assistant Inspector General for Program Evaluation
Scott C. Fulton
Acting Deputy Administrator
Cynthia Giles
Assistant Administrator for Enforcement and Compliance Assurance
Peter S. Silva
Assistant Administrator for Water
This is our report on the subject evaluation conducted by the Office of Inspector General (OIG)
of the U.S. Environmental Protection Agency (EPA). This report contains findings that describe
the problems the OIG has identified and corrective actions the OIG recommends. This report
represents the opinion of the OIG and does not necessarily represent the final EPA position.
Final determinations on matters in this report will be made by EPA managers in accordance with
established resolution procedures.
The estimated cost of this report - calculated by multiplying the project's staff days by the
applicable daily full cost billing rates in effect at the time - is $998,055.
Action Required
In accordance with EPA Manual 2750, you are required to provide a written response to this
report within 90 calendar days. You should include a corrective actions plan for agreed-upon
actions, including milestone dates. We have no objections to the further release of this report to
the public. This report will be available at http://www.epa.gov/oig.
If you or your staff have any questions, please contact Dan Engelberg at (202) 566-0830 or
engelberg.dan@epa.gov, or Ira Brass at (212) 637-3057 or brass.ira@epa.gov.
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EPA Needs a Better Strategy to Identify Violations
of Section 404 of the Clean Water Act
10-P-0009
Table of Contents
Chapters
1 Introduction 1
Purpose 1
Background 1
Noteworthy Achievements 4
Scope and Methodology 4
2 EPA Lacks a Unified Framework to Manage the Section 404
Enforcement Program 6
EPA's Identification of §404 Violators Needs to Be More Systematic 6
EPA Must Improve Coordination with Enforcement Partners 8
Jurisdictional Uncertainty Has Further Impaired EPA's Ability
to Address §404 Violations 10
Conclusion 11
Recommendations 11
Agency Response and OIG Evaluation 11
Status of Recommendations and Potential Monetary Benefits 14
ppendices
A Details on Scope and Methodology 15
B Agency Response 18
C Distribution 24
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Chapter 1
Introduction
Purpose
We conducted this review to assess the U.S. Environmental Protection Agency's
(EPA's) enforcement role in protecting federally regulated wetlands, streams, and
other surface waters under Section 404 (§404) of the Clean Water Act (CWA).
CWA §404 regulates the discharge of dredged or fill material into "waters of the
United States," including wetlands and other surface waters. We focused on §404
enforcement because EPA has direct responsibility for certain types of §404
violations. We sought to answer the following question: How effective is EPA at
identifying violations of §404 of the CWA that fall under its enforcement
authority?
Background
Wetlands are among the Nation's most important natural resources. They provide
a variety of benefits, such as pollutant reduction/removal, flood protection,
shoreline erosion control, carbon sequestration, and ground water recharge. As
primary habitats for fish, waterfowl, and wildlife, they are economically
important and provide numerous opportunities for education, recreation, and
research.
The U.S. Fish and Wildlife
Service (FWS) estimated that
the continental United States had
approximately 221 million acres
of wetlands in the 1780s. By the
mid-1980s, 117 million wetland
acres had been lost; only
approximately 104 million acres
^ remained (a 53 percent loss of
original wetlands area). Within
this timeframe, 22 States lost
more than 50 percent of their
wetlands area; 10 of these States
lost more than 70 percent (see
Table 1-1).
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Table 1 -1: Wetland Loss by State, 1780s-1980s
State
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
% Original
Wetlands
Lost
50
0.1
36
72
91
50
74
54
46
23
12
56
85
87
89
48
81
State
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
% Original
Wetlands
Lost
46
20
73
28
50
42
59
87
27
35
52
9
39
33
60
49
49
State
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
% Original
Wetlands
Lost
90
67
38
56
37
27
35
59
52
30
35
42
31
24
46
38
Source: Dahl, T.E. 1990. Wetlands Loses in the United States 1780's to 1980's.
U.S. Department of the Interior, FWS.
Federal Regulation and Enforcement
With the 1972 passage of the CWA, the Federal Government began to regulate
the discharge of dredged or fill material into navigable waters, including wetlands
and other surface waters. Discharges of
dredged or fill material occur most
frequently from development activities (e.g.,
residential, commercial, or municipal),
infrastructure improvements (e.g., highways,
dams, and airports), mining projects, and
nonexempt agricultural activities. The CWA
gives EPA and the U.S. Army Corps of
Engineers (Corps) the ability to take
enforcement actions against those who
violate §404. The Assistant Secretary of
the Army for Civil Works oversees the
Corps' regulatory program.
Fill from surface mining operations
may be discharged into surface waters
or wetlands. (EPA Region 3 photo)
Within EPA, two offices share responsibilities for protecting wetlands. EPA's
Office of Water, through its Office of Wetlands, Oceans, and Watersheds
(OWOW), makes determinations on the scope of geographic jurisdiction and
exemptions, develops regulations governing the environmental factors the Corps
must consider when evaluating permit applications, and approves State and tribal
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assumption of the §404 program. EPA's Office of Enforcement and Compliance
Assurance (OECA) enforces violations of the CWA, including violations of §404.
The Corps makes most §404 permit decisions, but in certain instances OWOW
can elevate or veto these decisions.
EPA shares §404 enforcement responsibilities with the Corps under a 1989
Memorandum of Agreement (MOA). EPA has the lead enforcement role in a
limited number of cases, including: (1) unpermitted activities that involve repeat
violators, (2) flagrant violations, (3) where EPA requests a class of cases or a
particular case, or (4) where the Corps determines that an EPA administrative
penalty action is warranted. The Corps has the lead enforcement role in all other
unpermitted cases and in all cases where there is a violation of a §404 permit. In
the 1989 MO A, EPA and the Corps agreed to:
• Enter into interagency agreements with other federal, State, tribal, and
local agencies that will provide assistance to the Corps and EPA in pursuit
of §404 enforcement activities.
• Enter into field level agreements (FLAs) between Corps division or
district offices and their respective EPA regional offices to more
specifically implement the 1989 MOA's provisions.
• Where available, exchange data that would enhance either agency's
enforcement efforts.
• Begin developing a computerized list of persons who have received
after-the-fact permits or been subject to a §404 enforcement action.
Although OECA Headquarters formally administers and manages EPA's portion
of the federal §404 enforcement program, enforcement work is performed by
regional staff. OECA states in its National Program Managers Guidance that
regions should:
• Have a process for identifying, targeting, inspecting, and otherwise
responding to illegal activities in wetlands; and
• Coordinate, as appropriate, with other federal agencies that have
significant roles in wetlands protection through the use of memoranda of
understanding and memoranda of agreement (e.g., the Corps, FWS, etc.).
The regions learn of possible §404 violations in various ways, including referrals
from the Corps or other regulatory agencies and tips from concerned citizens.
Once the regions receive a complaint, they must determine whether it actually
involves an activity that would be regulated under §404. If they find the activity
to be a §404 violation, they will then work with the Corps to determine which
agency will take the lead for that particular case. Once that determination is
made, the lead agency will initiate an enforcement action.
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State-level Enforcement
Michigan and New Jersey are the only States that are authorized to implement the
§404 program; they may prosecute §404 violations under State law. In addition,
29 States supplement federal §404 enforcement with varying degrees of State-
level wetlands enforcement. The remaining 19 States lack State-level
enforcement and rely on the Federal Government for wetlands enforcement.
States have indicated they have not pursued program authorization because their
programs are not equivalent to the federal program and they lack federal funds for
implementation. States are also concerned about coordinating with FWS and the
National Marine Fisheries Service on threatened/endangered species issues.
Noteworthy Achievements
Individual EPA regions have made some strides toward better identification of
§404 violations. For example, during regular meetings with the St. Paul Corps
District, Region 5 staff discuss which violations would be good candidates for
referral to the Region under the 1989 MOA. By tracking the Corps' enforcement
actions (notably Notices of Violation or Cease and Desist Orders), Region 5
officials also find out about potential repeat violators in districts that do not
typically refer §404 violations to EPA. Region 3, meanwhile, uses the Civil Air
Patrol to provide aerial support services for the §404 program.
EPA staff in Regions 1, 3, 4, 7, and 8 reported that they have used construction
stormwater (CWA §402) inspections to identify §404 violations. Regions 1 and 7
use inspection checklists that allow their inspectors to identify violations of both
§402 and §404. Stormwater inspectors' reports were the foundation for two of the
§404 enforcement actions that Region 7 pursued in 2008.
Scope and Methodology
We conducted this review in accordance with generally accepted government
auditing standards. Those standards require that we plan and perform the
evaluation to obtain sufficient, appropriate evidence to provide a reasonable basis
for our findings and conclusions based on our objectives. We believe that the
evidence obtained provides a reasonable basis for our findings and conclusions
based on our objectives. We performed our review from May 2008 to August
2009.
We used a variety of methods to evaluate EPA's effectiveness at identifying
unauthorized violations of §404 under its enforcement authority as outlined in the
1989 MOA. We reviewed CWA §§309, 401, and 404; EPA and Corps policies
and guidance documents; and current FLAs between EPA regions and Corps
districts. We also reviewed the MO As between EPA Regions 2 and 5 and the two
States that can implement the §404 program (New Jersey and Michigan).
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We sent a brief information request to all 10 EPA regions. We conducted
interviews with personnel from EPA Headquarters and six regions, Corps
Headquarters and eight districts, FWS Headquarters, and the Natural Resources
Conservation Service (NRCS) Headquarters. We visited six States, two water
management districts in Florida, and a State association for conservation
commissioners. During our interviews, we discussed internal controls regarding
identification and tracking of unauthorized violations, as well as communication
and collaboration with federal and State partners.
We also judgmentally selected 59 final enforcement actions from EPA's
Enforcement and Compliance History Online database for further review during
interviews with EPA regional staff. We did not independently verify the accuracy
or reliability of data provided by the database. We did not review the selected
final enforcement actions in EPA's internal enforcement database, the Integrated
Compliance Information System.
There have been no recent OIG reports on §404 enforcement issues.
Further details on our scope and methodology are in Appendix A.
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Chapter 2
EPA Lacks a Unified Framework to Manage the
Section 404 Enforcement Program
EPA lacks a systematic framework for identifying §404 violations for which it is
responsible under the!989 MOA. Primarily because of a limited field presence
related to §404 violations, EPA identifies violations through a passive, reactive
method of relying on complaints and referrals from external sources. An
incomplete national data system and sporadic coordination with federal and State
partners further impair EPA's ability to maintain an effective §404 enforcement
program. EPA must develop a framework that includes a §404 enforcement
strategy that includes increased communication/coordination with enforcement
partners, a system to track repeat and flagrant violators, performance measures,
and cross-training. Without an effective framework or strategy, EPA cannot be
assured that it is sufficiently protecting wetlands and other surface waters from
§404 violations involving dredged or fill activity. Further, the current system
does not provide EPA with the necessary inputs to make informed decisions about
the allocation of resources for §404 enforcement.
EPA's Identification of §404 Violators Needs to Be More Systematic
Although OECA's Fiscal Year (FY) 2010 National Program Managers Guidance
states that EPA should have a process for identifying illegal activities in wetlands,
EPA has no strategy beyond the 1989 MOA. This is in contrast with other CWA
programs - such as stormwater and combined/sanitary sewer overflows - for
which OECA has developed specific enforcement strategies. In the absence of a
§404-specific strategy, EPA relies on external sources for information about
violations, particularly the Corps. The Corps also only primarily learns about
§404 violations through external sources, often from private citizens.
Additionally, current reporting mechanisms do not always inform EPA of whether
someone has repeatedly violated State-level wetlands protection laws.
EPA Relies on External Sources for Violation Knowledge
In part because of its limited field presence, all of the regions interviewed
primarily relied on complaints, tips, and referrals to learn about §404 violations.
For example, for Region 1 during FYs 2004-2008, citizen complaints accounted
for 59 percent of reported violations, other government sources accounted for
28 percent, unknown sources accounted for 10 percent, and EPA itself only
accounted for 3 percent.
EPA receives more referrals from the Corps than any other regulatory agency.
For example, the Corps supplied Region 4 with 86 percent of the §404 violations
the Region pursued in FYs 2004-2008. During the same period, every Region 8
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§404 enforcement action was the result of a Corps referral. The Corps itself takes
a reactive approach toward identifying violations, relying primarily on complaints
and referrals from external sources. Citizen complaints are the primary source for
violation information in six of the eight Corps districts interviewed and a major
source of information in the other two districts. If the Corps identifies a violation
itself, it tends to occur randomly while checking for permit compliance.
Only those States that implement the CWA §404 program (Michigan and New
Jersey) must report their wetlands compliance and enforcement activities to EPA.
Michigan lists violations of greater than 1 acre (including the violator's name) in
its annual report to EPA. For FYs 2006-2008, Michigan reported 2,236 violations
of Parts 301 and 303 of its Natural Resources and Environmental Protection Act,
the State equivalent of §404.
The 29 States that supplement §404 with State enforcement are not authorized to
implement the CWA §404 program or obligated to report their program activities
to either EPA or the Corps. Nevertheless, several States publish their annual
wetland enforcement statistics. Some State annual reports, such as those for
Maryland, New Hampshire, and Maine, list wetland violators by name, providing
both EPA and the Corps with a list of potential repeat violators. However, during
field work interviews, no EPA regional staff stated they use these reports to
identify possible §404 cases.
While the Corps' regulatory database may contain a violator's past history, that
history may not include all State-level enforcement activity. In April 2009, the
Corps' Green Bay field office was notified of a possible violation. However, it
was only after the Corps had consulted with the Wisconsin Department of Natural
Resources that it learned the State had already pursued an enforcement action in
2005 against the responsible party. There was no record of the State enforcement
action in the Corps' regulatory database.
EPA Lacks Processes and Tools to Identify Repeat §404 Violators
EPA's enforcement database does not provide complete §404 violation histories.
Because EPA lacks a systematic approach to assessing a violator's prior §404
enforcement history, it may not be able to identify all repeat §404 violators,
especially if they are smaller operators. To confirm whether violators have been
subject to §404 orders in other regions, staff in Regions 3 and 8 have had to
contact staff in other regions.
Moreover, EPA staff cannot directly access the Corps' enforcement records.
While OWOW is developing an interface with the Corps' national regulatory
database, that interface will provide EPA staff with CWA permit and
jurisdictional data. EPA enforcement staff will still need to ask Corps staff to
query respondent violation histories on their behalf.
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EPA Must Improve Coordination with Enforcement Partners
EPA must improve its coordination with its §404 enforcement partners. In the
absence of detailed national guidance on §404 referrals, EPA regions rely on
FLAs with Corps districts. The FLAs vary both in content and the degree to
which they are implemented, creating inconsistencies in the referral process.
When EPA has agreements with other federal agencies, such as FWS and NRCS,
they are often temporary or unclear. Additionally, the enormous variation in State
wetlands enforcement programs complicates coordination efforts.
EPA Needs to Increase Coordination with the Corps
EPA and the Corps lack detailed procedural guidance on §404 case referrals. The
1989 MOA provides only general details on which cases should be referred to
EPA - specifically, "repeat or flagrant" violations where the violator is not
covered by a §404 permit. Most regions have not developed a standard referral
process with their corresponding Corps districts. Instead, the current process
consists of informal collaboration agreements and personal relationships between
EPA and Corps staff. As a result, the rationale for referring cases to EPA, as well
as the quality of referral packages, varies from district to district.
Officials in four of the eight interviewed Corps districts said that while the criteria
in the 1989 MOA are evaluated and considered in referral decisions, they
generally only refer violations to EPA if in-house resolution fails. When there is
a violation of a permitted project, three of the interviewed districts determine
whether to refer the violation to EPA based on the impact compared with the
project's original scope, while two other districts regard these activities strictly as
violations of the §404 permit and resolve them in-house.
In an effort to more specifically implement the 1989 MOA's limited referral
guidance, EPA regions have finalized supplemental FLAs with 21 of the 38 Corps
districts (Region 1 is included but abides by an unsigned FLA). Region 4's FLA
with the Jacksonville Corps District requires that the lead agency status be
determined within 15 days of the original notification of violation letter. In
contrast, according to the Memorandum of Understanding between Region 5 and
the St. Paul Corps District, the Region has 134 days to determine whether it wants
to accept a referral. If a violator applies for an after-the-fact permit during this
period when it is unclear which agency has lead enforcement status, the District
may need to initiate a review of the permit application.
EPA and the Corps differ in how they implement their FLAs. For example, in
Region 4, the quantity and quality of enforcement referrals vary significantly
between the five Corps districts with which it has FLAs. Some of the FLAs lack
a requirement for Corps districts to report unauthorized violations to EPA regions
and a standardized explanation of the referral process. Although the Region has
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FLAs with the Vicksburg and Mobile Corps Districts, Region 4 staff reported that
both Districts have essentially stopped sending referrals.
EPA Needs to Increase Coordination with Other Federal Agencies
Coordination with federal agencies other than the Corps that have wetlands-
related programs would provide EPA with additional resources in the field and
save resources when developing enforcement cases. For example, Region 3 has
an interagency agreement with one FWS field office on identifying wetlands
violations. The FWS field office reports any potential violations to the Region
and inspects violations reported to the field office by EPA, the State, the public,
and other organizations. In one case, FWS employees discovered and
investigated two different violations on the same property. Other regions have
entered into similar interagency agreements with FWS, but they are often
temporary and expire when funding to support the agreements runs out.
Lack of coordination with NRCS has created uncertainty about the types of
information the agency can share with EPA. As part of a 1994 MO A between
EPA, the Corps, FWS, and NRCS, the agencies agreed that EPA and the Corps
would rely on wetlands determinations made by NRCS on agricultural lands for
the purposes of determining §404 jurisdiction. A 2002 amendment of the Farm
Security and Rural Investment Act prohibited NRCS from sharing confidential
producer information, including wetlands delineations and determinations, to
agencies outside the U.S. Department of Agriculture. As a result of these
amendments, NRCS and the Corps both withdrew from this MOA in January
2005 and signed a separate bilateral agreement in February 2005. In November
2005, NRCS issued a directive indicating its staff could release the following
information to the public and federal, State, and local agencies or entities:
• Maps or aerial photographs showing wetland locations/boundaries;
• Site visit reports and documentation of site conditions prepared by NRCS;
• Wetland determination data sheets prepared by NRCS; and
• Technical determinations (e.g., functional assessments) made by NRCS.
Recent changes in legislation and NRCS policy created additional uncertainty
about whether NRCS field offices can share this information. NRCS currently
interprets the 2008 Farm Bill as prohibiting the release of wetlands delineations
and determinations to agencies outside the U.S. Department of Agriculture.1 EPA
must now contact the landowner directly for this information. The landowner can
either give NRCS permission to release this information to EPA, release the
information directly to EPA, or deny permission to release the information.
Enforcement staff from Regions 1, 4, and 7 said information about wetlands
determinations and delineations made by NRCS would still be useful to §404
enforcement efforts. In one instance, Region 1 developed an enforcement action
1 National Bulletin 130.9.2 - Processing Freedom of Information Act Requests Under Section 1619 of the Farm Bill
(December 30, 2008). This National Bulletin expires September 30, 2009.
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against a farm owner only to later learn that NRCS had classified the farmland as
exempt from §404 requirements.
Improved Coordination with State Agencies Would Be Beneficial
EPA's formal agreements with States are limited to New Jersey and Michigan.
New Jersey's and Michigan's MO As with Regions 2 and 5, respectively, enable
them to carry out the policies, regulations, and procedures necessary to administer
the permit program established under §404. The MO As outline how the Regions
will coordinate wetlands-related enforcement activities with those States.
Better coordination between EPA and States that do not implement the §404
program would help send a more consistent message to §404 violators. Staff in
Minnesota's Department of Natural Resources said they would like to see EPA or
the Corps take the lead in prosecuting more of the wetland fills that are exempt
under State law but not under §404, and better coordination could facilitate such
action. While no EPA regional staff reported using State wetland violation
reports to identify possible §404 cases, some State violation reports include
information on wetland fills that are exempt under State law. If EPA reviewed
these reports regularly, it might be better positioned to take the lead in prosecuting
wetland fills that are exempt under State law but not under §404.
Jurisdictional Uncertainty Has Further Impaired EPA's Ability to
Address §404 Violations
Even when EPA and its partners are aware of §404 violations, they may be unsure
whether they have the legal authority to bring enforcement actions. Prior to 2001,
the scope of the CWA was fairly straightforward and could be interpreted to be
more expansive. In 2001, the U.S. Supreme Court's SWANCC2 decision
effectively removed from CWA jurisdiction isolated waters that had previously
been found to be Jurisdictional based solely on the presence of migratory birds.
The limits of CWA jurisdiction became more uncertain in 2006 after the Court's
split decision in the Rapanos3 case. In a March 2008 memo, EPA reported that it
dropped 77 potential CWA §404 enforcement actions between July 2006 and
December 2007 because it was uncertain it could establish jurisdiction under the
CWA. In some cases, the Jurisdictional uncertainty that resulted from the
Rapanos and SWANCC cases makes it unclear whether a §404 violation has even
occurred. In response to our draft report, EPA maintained that the effect of the
Rapanos and SWANCC decisions on its §404 enforcement program cannot be
overstated.
2 Solid Waste Agency of Northern Cook County v. United States Corps of Engineers, 531U.S. 159 (2001).
^Rapanos etux., et al. v. United States, 547 U.S. 715 (2006).
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Conclusion
EPA has not established a comprehensive, unified framework for its portion of the
§404 enforcement program. EPA must develop a strategy for a comprehensive
framework that includes guidance and controls that will allow it to effectively
identify and resolve violations. Improved coordination with the Corps, other
federal agencies, and the States should allow EPA to enforce §404 more
efficiently. Without an effective framework or strategy, EPA cannot be assured
that it is sufficiently protecting wetlands and other surface waters from §404
violations involving dredged or fill activity. Further, the current system does not
provide EPA with the necessary inputs to make informed decisions about the
allocation of resources for §404 enforcement.
Recommendations
We recommend that the Assistant Administrator for Enforcement and Compliance
Assurance, in consultation with the Assistant Administrator for Water:
2-1 Develop and implement a comprehensive CWA §404 enforcement strategy
that should address, but not be limited to, the following areas:
a. Creation of a national tracking system for complaints and referrals from
the Corps, as well as repeat and flagrant §404 violators;
b. Improved communication and coordination between EPA
Headquarters/regions and Corps Headquarters/districts;
c. Barriers to enhanced interagency communication (and mechanisms to
overcome these barriers) with the Corps, as well as other federal agencies
(e.g., NRCS, FWS, and Civil Air Patrol);
d. The feasibility of leveraging other CWA program resources to more
systematically identify §404 violations;
e. The adequacy of EPA's current performance measurement system for the
§404 enforcement program; and
f Cross-training opportunities with federal, State, and other stakeholders.
We recommend that the Deputy Administrator:
2-2 Revise, in collaboration with the Assistant Secretary of the Army for Civil
Works, the 1989 MO A to clarify the types of cases that should be referred to
EPA or the Corps; the revised MOA should update the procedures for case
referrals.
Agency Response and OIG Evaluation
The Assistant Administrator, Office of Enforcement and Compliance Assurance,
responded to our draft report on October 9, 2009 (see Appendix B). Overall, EPA
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agreed that it could improve the effectiveness of its §404 enforcement program by
taking a more proactive approach to detecting and enforcing violations.
EPA agreed with our first recommendation to develop and implement a
comprehensive §404 enforcement strategy. In its response, EPA indicated that it
plans to comprehensively evaluate the wetlands program and each of the
subrecommendations (a) through (f) to determine which elements are essential to
an effective enforcement strategy. For example, EPA stated that the role of field
inspections conducted by other CWA programs to discover §404 violations
should be expanded as part of the enforcement strategy. EPA indicated it may
initially pilot the developed enforcement strategy in a specific watershed, such as
the Chesapeake Bay, to determine which elements should be included in the
national strategy.
In response to our second recommendation, EPA believed that any decision about
revisions to the existing 1989 MOA with the Corps should be informed by the
implementation of the enforcement strategy. It provided alternative language for
this recommendation.
In its response, EPA explained that it often learns of §404 violations from external
sources, such as tips, complaints, or the Corps, because the CWA does not require
the public to self-report their wetlands activities to the Agency. However, EPA
agreed that while these sources can be an important part of an enforcement
strategy, they should not be the sole foundation of an effective enforcement
program. EPA also stressed that the Rapanos and SWANCC decisions greatly
impacted the amount of resources needed to determine jurisdiction. As a result,
EPA may choose to devote already limited resources to cases where jurisdiction is
less uncertain and, therefore, easier to establish.
While we commend EPA for its willingness to develop a national-level
enforcement strategy for the §404 program, it is imperative that the Agency also
implement the strategy. The Agency's response does not address implementation
issues, nor does it provide reasonable assurance that the strategy will address
subrecommendations (a) through (f). In addition, given the wide variability in
wetlands characteristics, we are also concerned that focusing the pilot study in a
single watershed will not provide EPA with a comprehensive evaluation of the
strategy. We believe that EPA should expand the scope of its pilot study to
additional geographical areas. We encourage EPA to conduct these pilots within
defined and reasonable timeframes.
We acknowledge that the strategy development process will provide the Agency
with additional insight regarding what changes are needed to the current case
referral process. Given our findings, we still believe the 1989 MOA will need to
be revised once EPA completes the §404 enforcement strategy. Therefore, we
consider both recommendations undecided.
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The Agency's response also included some suggested editorial revisions to clarify
certain factual issues. We have reviewed those suggestions and made changes to
the report, as appropriate.
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Status of Recommendations and
Potential Monetary Benefits
RECOMMENDATIONS
Rec.
No.
Page
No.
Subject
Status1
Action Official
Planned
Completion
Date
POTENTIAL MONETARY
BENEFITS (in $OOOs)
Claimed Agreed To
Amount Amount
2-1 11 Develop and implement a comprehensive CWA
§404 enforcement strategy that should address,
but not be limited to, the following areas:
a. Creation of a national tracking system for
complaints and referrals from the Corps, as
well as repeat and flagrant §404 violators;
b. Improved communication and coordination
between EPA Headquarters/regions and
Corps Headquarters/districts;
c. Barriers to enhanced interagency
communication (and mechanisms to
overcome these barriers) with the Corps,
as well as other federal agencies
(e.g., NRCS, FWS, and Civil Air Patrol);
d. The feasibility of leveraging other CWA
program resources to more systematically
identify §404 violations;
e. The adequacy of EPA's current
performance measurement system for the
§404 enforcement program; and
f. Cross-training opportunities with federal,
State, and other stakeholders.
2-2 11 Revise, in collaboration with the Assistant
Secretary of the Army for Civil Works, the 1989
MOA to clarify the types of cases that should be
referred to EPA or the Corps; the revised MOA
should update the procedures for case referrals.
Assistant Administrator
for Enforcement and
Compliance Assurance,
in consultation with
Assistant Administrator
for Water
Deputy Administrator
0 = recommendation is open with agreed-to corrective actions pending
C = recommendation is closed with all agreed-to actions completed
U = recommendation is undecided with resolution efforts in progress
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Appendix A
Details on Scope and Methodology
Wetlands Enforcement Information Request
We sent a brief information request to all EPA regions about how they identify violations of
§404 of the CWA that fall under their enforcement authority as described in the 1989 MO A
between EPA and the Corps, including:
• How regions define flagrant and recurring violations of §404.
• What types of policies and guidance regions use to define/identify violations of §404.
• What other types of wetlands-related enforcement policies and guidance regions use,
e.g., standard operating procedures and FLAs with Corps districts.
• How regions resolve lower priority violations of §404.
We received and analyzed responses to the information request from all 10 regions.
Interviews with Federal, State, and Other Organizations
We interviewed a variety of personnel from federal, State, and other organizations, including
EPA and the Corps, as follows:
EPA
• OECA
• OWOW
• Office of General Counsel
• Region 1
• Region 3
• Region 4
• Region 5
• Region 7
• Region 8
Corps
• Headquarters, Regulatory Branch
• New England District
• Pittsburgh District
• Savannah District
• Jacksonville District
• St. Paul District
• Detroit District
• Rock Island District
• Omaha District
State
Massachusetts Department of Environmental Protection
Florida Department of Environmental Protection
Georgia Department of Natural Resources
Michigan Department of Environmental Quality
Minnesota Pollution Control Agency
Minnesota Department of Natural Resources
Minnesota Board of Water and Soil Resources
Nebraska Department of Environmental Quality
Other Agencies and Organizations
• FWS - Division of Habitat and Resource Conservation
• NRCS
• St. Johns River Water Management District
• Northwest Florida Water Management District
• Association of State Wetland Managers
• Massachusetts Association of Conservation Commissioners
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Our purpose during the interviews was to gain a better understanding of how these agencies and
organizations identify unauthorized violations of §404 (proactively or reactively), process known
violations, and collaborate with other agencies. Generally, the topics covered during an
interview included:
• Sources of information about §404 violations, e.g., citizen complaints and Corps personnel.
• Effect of recent changes to jurisdictional determinations and subsequent case development.
• Use of internal and external databases to track violations and case development.
• Use of field-level agreements and other documents to improve collaboration.
• Effectiveness of remote sensing and other surveillance techniques for identifying §404
violations.
Review of EPA's Enforcement Database and Selection of Final Enforcement Actions
We reviewed EPA's Enforcement and Compliance History Online database for specific
information regarding enforcement actions taken by EPA Regions 1, 3, 4, 5, 7, and 8 under
CWA §404 between October 1, 2003, and September 30, 2008. During this time, these regions
took 340 final enforcement actions under CWA §404. We judgmentally selected 59 actions
(see Table A-l) to discuss during regional interviews, including those:
• That were identified as flagrant, egregious, or repeat violations in the case narrative;
• That represented the majority of States located within the region;
• Where violations occurred across more than one EPA region;
• With a variety of wetlands types, impact sizes, and types of violators (e.g., individuals,
municipalities, corporations, and developers);
• With high penalty amounts (a proxy for the size of the violation); and
• With high compliance action costs (also a proxy for the size of the violation).
Table A-1: Section 404-related Final Enforcement Actions Selected for Further Review
Region 1
01-2000-0017
01 -2004-2047
01 -2005-2007
01 -2006-2027
01 -2008-2030
01 -2008-2031
01 -2008-2032
01-2008-2515
Region 3
03-2004-0309
03-2005-0270
03-2006-0085
03-2006-01 73
03-2007-0203
03-2000-0281
03-2005-0357
Region 4
04-2008-5504
04-2005-5754
04-2007-5754
04-2003-9032
04-2008-5767
04-2008-5501
04-2008-5502
04-2008-5503
04-2004-5751
04-2004-5752
04-2004-5753
04-2004-5754
04-2002-9008
04-2006-5755
Region 5
05-2001-0704
05-2008-8201
05-2008-8202
05-2008-8203
05-2007-0612
05-1997-0371
05-2006-2347
05-2005-0502
05-2003-0723
Region 7
07-2007-01 44
07-2007-01 25
07-2005-01 63
07-2004-0332
07-2007-01 59
07-2007-0206
07-2007-01 22
07-2008-0072
07-2008-0073
Region 8
08-2006-0052
08-2007-01 74
08-2003-0822
08-2005-01 96
08-2005-0213
08-2007-0016
08-2004-0212
08-2005-01 64
08-2004-0209
08-2005-01 67
08-2008-0060
08-2007-01 73
Source: OIG analysis
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During interviews with regional wetlands enforcement personnel, the team sought to learn for
each case:
• When EPA or the Corps discovered the violation or received a complaint/referral,
• When EPA became the lead enforcement agency,
• Details about the violation, and
• Information sources used to develop the case.
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Appendix B
Agency Response
October 9, 2009
MEMORANDUM
SUBJECT: Evaluation Report: "EPA Needs a Better Strategy to Identify Violations of
Section 404 of the Clean Water Act," Project No.OPE-FY08-0006
FROM: Cynthia Giles
Assistant Administrator
TO: Wade Najjum
Assistant Inspector General for Program Evaluation
Office of Inspector General
On behalf of the Deputy Administrator and the Office of Water (OW), I am writing to
transmit EPA's comments on the subject Report. We appreciate the opportunity to respond to the
Office of Inspector General's (OIG) findings and recommendations as reported in "EPA Needs a
Better Strategy to Identify Violations of Section 404 of the Clean Water Act." We would like to
thank you and your staff for your willingness to meet to resolve comments and to discuss your
findings, and for incorporating many of our specific comments and corrections on the discussion
draft. We believe that this collaborative approach is important to achieving a more accurate and
effective Report. The Agency agrees that it could improve the effectiveness of its Section 404
enforcement program by taking a more proactive approach to detecting and enforcing violations,
and that the OIG's suggestions are helpful in identifying areas where the enforcement program
could be strengthened.
As your report notes briefly, the recent SWANCC and Rapanos decisions have had a
significant impact on enforcement targeting and case development. Because of the increased
evidentiary burdens imposed by these cases, EPA is now required to devote significant resources
to jurisdictional determinations before it decides whether to pursue an enforcement case. This
has had the effect of diverting scarce resources away from activities designed to detect Section
404 violations. This issue will continue to impact any enforcement strategy developed by the
agency. We encourage the OIG to consider emphasizing these challenges more fully in the final
Report.
EPA agrees with the first recommendation in the Report to develop and implement a
comprehensive section 404 enforcement strategy. EPA may initially focus or pilot an
enforcement strategy in a particular watershed, such as the Chesapeake Bay. The results of the
pilot could then be used to inform the development of a national strategy. An enforcement
strategy should include, among other things, a more proactive approach to enforcement,
including more effective coordination with the Army Corps of Engineers (the Corps). With
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respect to the second recommendation, EPA believes that we should develop and gain experience
with a section 404 enforcement strategy before embarking on a revision of the 1989
Memorandum of Agreement (MOA) with the Corps. We recognize that the Corps is a
significant source of information to EPA on potential violators and would be collaborating
closely with it in implementing a new strategy. Once EPA implements the new enforcement
strategy or completes any pilot, it would have a much clearer understanding of whether, and to
what extent, the MOA should be revised.
We appreciate the opportunity to review and comment on this draft Report. Please see
our attached detailed comments to each of the issues and recommendations. Should you have
any questions or concerns regarding this response, please contact EPA's Audit Liaison,
Gwendolyn Spriggs, at 202-564-2439.
Attachment
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EPA Response to OIG Draft Report
EPA Needs a Better Strategy to Identify Violations of Section 404 of the Clean Water Act
Project No. OPE-FY08-0006
I. EPA's Response to Report Recommendations
Report Recommendation 2-1:
Develop and implement a comprehensive CWA Section 404 enforcement strategy
that should address, but not be limited to, the following areas:
a. Creation of a national tracking system for complaints and referrals from the
Corps, as well as repeat and flagrant Section 404 violators;
b. Improved communication and coordination between EPA Headquarters/regions
and Corps Headquarters/districts;
c. Barriers to enhanced interagency communication (and mechanisms to overcome
these barriers) with the Corps, as well as other federal agencies (e.g. NRCS,
FWS, and Civil Air Patrol);
d. The feasibility of leveraging other CWA program resources to more
systematically identify Section 404 violations;
e. The adequacy of EPA's current performance measurement system for the
Section 404 enforcement program;
f. Cross-training opportunities with federal, state, and other stakeholders.
Comment:
EPA agrees with Recommendation 2-1 and plans to develop, in consultation with OW
and the Regional offices, and in collaboration with the Corps as appropriate, an
appropriate enforcement strategy. In developing the strategy, EPA will comprehensively
evaluate the program, including each of the sub-recommendations (a)-(f) to determine
whether each of these elements is essential to an effective enforcement strategy.
With respect to Recommendation 2-1, EPA would like to retain the discretion to
thoroughly evaluate the sub-recommendations (a)-(f) before deciding whether to include
all, or only some of, them in the Section 404 enforcement strategy. This opportunity for
evaluation will enable EPA to determine which elements are essential to an efficient and
effective Section 404 enforcement strategy. EPA might initially pilot or focus such an
enforcement strategy in the Chesapeake Bay watershed to determine which elements are
most effective. This experience will help EPA to further refine the Section 404
enforcement strategy.
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Report Recommendation 2-2:
Revise, in collaboration with the Assistant Secretary of the Army for Civil Works,
the 1989 MOA to clarify the types of cases that should be referred to EPA or the
Corps; the revised MOA should update the procedures for case referrals.
Comment:
While EPA agrees that improved coordination with the Corps is essential to a more
proactive Section 404 enforcement program, EPA believes that implementing an
enforcement strategy should inform any decision on revisions to the existing MOA with
the Corps. EPA proposes the following language as a substitute:
"After development of a comprehensive enforcement strategy consistent with
Recommendation 2-1, EPA will evaluate whether the enforcement strategy has
effectively addressed the issues raised in the Report, and, if not, consider whether it is
necessary to revise the 1989 MOA to clarify the types of cases that should be referred and
the processes for making case referrals."
II. EPA's Specific Comments and Corrections on Text of the Report
FINDINGS SECTION
Finding: EPA Lacks a Unified Framework to Manage the Section 404 Enforcement
Program
EPA agrees that a successful Section 404 enforcement program must focus on actively
pursuing Section 404 violations through enforcement targeting and other proactive
approaches. Approaches such as using field inspections primarily intended to investigate
other types of CWA violations (e.g., Section 402 and Section 311) to also discover
violations of Section 404 should be expanded as part of a Section 404 enforcement
strategy. In addition, the Agency has implemented various initiatives, such as the
Tulloch ditching initiative, that have been successful in discovering large numbers of
violations involving certain types of activities or located in certain geographic regions.
An enforcement initiative, perhaps piloted in a particular watershed such as the
Chesapeake Bay, could serve as a template for the development of similar enforcement
targeting approaches as part of a new enforcement strategy.
Finding: EPA Relies on External Sources for Violation Knowledge
In earlier discussions with the DIG, the Agency commented that, because Section 404 of
the CWA does not provide a statutory requirement for the regulated public to self-report
information to the Agency about wetlands activities, EPA has historically relied on
external sources such as tips and complaints, and referrals from the Corps, to learn about
Section 404 violations. While EPA agrees that tips and complaints should not be the sole
foundation of an effective enforcement program, these sources of information can be an
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important part of a successful enforcement strategy. When combined with other, more
proactive, approaches to discovering violations tips and complaints represent a successful
coordination between EPA and its governmental partners and private citizens, and allow
for public participation in wetlands enforcement efforts. Tips and complaints can also be
a very important source of information about significant Section 404 violations, as well
as of smaller, more discrete, violations that may otherwise go undetected. Finally,
although the Corps might be viewed as an "external source" of information, EPA believes
that it more accurate to characterize its relationship with the Corps as that of "co-
regulator." EPA believes that it is critical that the two agencies freely exchange
information so as to improve Section 404 enforcement throughout the federal
government.
Finding: Jurisdictional Uncertainty Has Further Impaired EPA's Ability to
Address Section 404 Violations
We respectfully submit that the effect that the SWANCC and Rapanos decisions have
had on the Agency's Section 404 enforcement program cannot be overstated. The
SWANCC and Rapanos decisions, and the inconsistent positions taken by the lower
courts in response, have created such uncertainty about the scope of CWA jurisdiction
that EPA must carefully evaluate whether it would be an appropriate use of Agency
resources to pursue particular Section 404 violations in pans of the arid west, where the
violations are located a great distance from a traditional navigable water, or where the
costs of proving jurisdiction are disproportionately large. In these circumstances, what
would have normally been considered a clear Section 404 violation prior to SWANCC
and Rapanos, is no longer certain, and would require the expenditure of additional
enforcement resources to support jurisdiction in court.
It is important to recognize that this resource burden begins at the outset of any
investigation of alleged wetlands violations. The Agency may expend substantial
resources only to determine jurisdiction is problematic, and the case will no longer be
pursued. Because of the resources necessary to prove jurisdiction, the Agency may
choose to devote its limited resources to cases where jurisdiction is less uncertain. The
result is that a large percentage of waters that would have been protected under Section
404 prior to SWANCC and Rapanos, such as headwater or ephemeral streams, streams in
arid parts of the country and isolated waters may receive less attention from the Agency
because of the costs of proving jurisdiction in these cases. We request that this section
even more strongly emphasize the impact of these decisions on the enforcement program.
We also request that this section be emphasized in an earlier section of this Report to
more accurately capture the significance that these issues have had on the Section 404
enforcement program.
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Technical Corrections
Beyond the substantive issues discussed in the comments, above, EPA would also like to suggest
additional editorial revisions to clarify certain factual issues in the Report.
1. The Report states that OWOW is developing an interface with the Corps' national database
that will "only provide EPA staff with Corps' permit data." In fact, the computer interface
being developed by the OWOW to exchange data with the Corps' national regulatory
database will provide access to Corps' permit data as well as data on Clean Water Act
jurisdiction. The second-to last sentence at the bottom of page 7 should be modified to
reflect this.
2. The Report states on page 8 that there is little consistency among the regions and Corps
districts regarding the processes and procedures for referral of cases to EPA. The Report
notes that, in some cases, this may result in uncertainty or confusion about who should be the
lead enforcement agency. While this uncertainty may cause delay in certain enforcement
cases, the Agency believes that the characterization that this uncertainty "could force [Corps]
Districts] to initiate a review of a violator's application for an after-the- fact permit" is
overstated. The Corps is not "forced" to issue or even consider an after-the-fact permit in
response to a potential Section 404 violation. Instead, in choosing to issue after-the-fact
permits the Corps is making a policy decision. EPA's view is that after-the-fact permits
should not be issued in lieu of enforcement actions where an enforcement action is warranted
and appropriate. Would ask that the last sentence of the third paragraph in this section be
replaced with the following:
"Uncertainly about which agency has the lead enforcement status during this period can
result in some delay. During this period, the Districts may choose to initiate the review of a
violator's application for an after-the-fact permit, although EPA does not believe that after-
the-fact permits should be issued in lieu of enforcement action."
3. On page 10, the Report refers to an enforcement case in Region 5 against a large coal mine in
Indiana as evidence of a lack of coordination between EPA and the state. However,
according to Region 5, EPA did, in fact, participate in interagency meetings with the Indiana
Department of Environmental Management, Indiana Department of Natural Resources and
the Corps as early as April 2007 to share information and coordinate EPA's enforcement
response in this particular case. We therefore request that this particular example be deleted.
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Appendix C
Distribution
Office of the Administrator
Acting Deputy Administrator
Assistant Administrator, Office of Enforcement and Compliance Assurance
Assistant Administrator, Office of Water
Principal Deputy Assistant Administrator, Office of Enforcement and Compliance Assurance
Deputy Assistant Administrator, Office of Water
Director, Office of Civil Enforcement, Office of Enforcement and Compliance Assurance
Deputy Director, Office of Civil Enforcement, Office of Enforcement and Compliance Assurance
Acting Director, Office of Wetlands, Oceans and Watersheds, Office of Water
Acting Deputy Director, Office of Wetlands, Oceans and Watersheds, Office of Water
Agency Follow-up Official (the CFO)
Agency Follow-up Coordinator
General Counsel
Associate Administrator for Congressional and Intergovernmental Affairs
Associate Administrator for Public Affairs
Audit Follow-up Coordinator, Office of Enforcement and Compliance Assurance
Audit Follow-up Coordinator, Office of Water
Acting Inspector General
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