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U.S. ENVIRONMENTAL PROTECTION AGENCY
OFFICE OF INSPECTOR GENERAL
Ensuring the safety of chemicals
Compliance with the law
EPA Can Better Reduce Risks
From Illegal Pesticides by
Effectively Identifying Imports
for Inspection and Sampling
Report No. 17-P-0412
September 28, 2017
-------
Report Contributors: Ganesa Curley
Jeffrey Harris
Jee Kim
Calvin Lin
Denton Stafford
Steve Weber
Abbreviations
ACE
Automated Commercial Environment
ACS
Annual Commitment System
CBP
U.S. Customs and Border Protection
CFR
Code of Federal Regulations
CMS
Compliance Monitoring Strategy
CTAC
Commercial Targeting Analysis Center
EPA
U.S. Environmental Protection Agency
FIFRA
Federal Insecticide, Fungicide and Rodenticide Act
FY
Fiscal Year
NOA
Notice of Arrival
NPMG
National Program Manager Guidance
OECA
Office of Enforcement and Compliance Assurance
OIG
Office of Inspector General
Cover photos: Containers of imported pesticides observed during a tour of the
Customs Central Examination site in Bensenville, Illinois. (EPA OIG photos)
Are you aware of fraud, waste or abuse in an
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tffcD STAf>
b . U.S. Environmental Protection Agency 17-P-0412
....\ \ Office of Inspector General September 28, 2017
At a Glance
V o
PRO"**-
Why We Did This Review
We conducted this review of
the U.S. Environmental
Protection Agency's (EPA's)
Federal Insecticide, Fungicide
and Rodenticide Act (FIFRA)
import inspection program to
determine whether the EPA is
effectively identifying imported
pesticides for inspection and
sampling to deter imports of
harmful pesticides and protect
human health and the
environment.
Illegal imports of pesticides can
present significant human
health and environmental risks,
and have been linked to
poisonings of children and pets.
Illegal imports include high-risk
pesticides that can be
counterfeit, produced at
unregistered establishments, or
produced using unauthorized
ingredients. According to the
EPA, inspections are a key
method to deter the import of
harmful pesticides.
This report addresses the
following:
• Ensuring the safety of
chemicals.
• Compliance with the law.
EPA Can Better Reduce Risks From
Illegal Pesticides by Effectively Identifying
Imports for Inspection and Sampling
Send all inquiries to our public
affairs office at (202) 566-2391
or visit www.epa.aov/oia.
Listing of OIG reports.
Low rates of inspections and
sampling can create a risk
that the EPA may not be
identifying or deterring the
import of pesticides harmful
to people or the environment.
What We Found
The EPA is at risk of not effectively identifying
imported pesticides for inspection and
sampling. EPA regions did not meet the
voluntary frequency goal of inspecting
2 percent of all shipments of imported
pesticides nationwide in fiscal years 2015 and
2016. In fiscal year 2016, the EPA's
10 regions conducted only 73 inspections of 46,280 pesticide shipments. This is
an inspection rate of 0.002; an inspection rate of 2 percent would have been
about 926 inspections. Consequently, there is limited assurance that imports in
violation of FIFRA will be identified or prevented entry into the United States.
We found that in two EPA regions, inspections were more likely to be conducted
close to the regional office rather than where the greatest number of pesticides
entered the region. In the last 5 years, the seven EPA regions we reviewed had
sampled and tested the integrity of only seven pesticides out of approximately
145,000 shipments of imported pesticides. Regional resources available to carry
out inspections are not considered part of strategic planning, and regional
participation in achieving the agency's inspection frequency goal is voluntary.
The EPA's implementation of the required U.S. Customs and Border Protection
Automated Commercial Enterprise system for automatic processing of import
notices will allow EPA regions more time for targeting and inspections. However,
the agency has no guidance or training available on how EPA regions can use
information from this system to target future inspections or develop their own
targeting strategies. Guidance or protocols for how EPA regions can coordinate
with U.S. Customs and Border Protection will also help to ensure that the EPA is
notified of any potentially illegal pesticides not found during the agency's review
of import notices.
Recommendations and Planned Agency Corrective Actions
We made four recommendations that the Assistant Administrator for Enforcement
and Compliance Assurance establish national compliance monitoring goals
based on regional resources; implement controls to monitor and communicate
progress on regional goals; develop guidance and train EPA regions to use the
Automated Commercial Enterprise system for regional targeting of importers,
manufacturers and pesticide products; and direct each EPA region to develop
guidance or protocols for coordinating with local U.S. Customs and Border
Protection offices regarding illegally imported pesticides. The EPA concurred with
developing protocols for coordinating with local U.S. Customs and Border
Protection offices. The remaining three recommendations are unresolved.
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
THE INSPECTOR GENERAL
September 28, 2017
MEMORANDUM
SUBJECT: EPA Can Better Reduce Risks From Illegal Pesticides by
Effectively Identifying Imports for Inspection and Sampling
Report No. 17-P-0410
FROM: Arthur A. Elkins Jr.
TO:
Lawrence Starfield, Acting Assistant Administrator
Office of Enforcement and Compliance Assurance
This is our report on the subject review conducted by the Office of Inspector General (OIG) of the
U.S. Environmental Protection Agency (EPA). The project number for this review was
OPE-FY16-0025. 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 audit resolution procedures.
Action Required
In accordance with EPA Manual 2750, the Office of Enforcement and Compliance Assurance and the
OIG will meet within 30 days to discuss unresolved Recommendations, 1, 2 and 3. Final decisions on
the unresolved recommendations will be timely posted on the OIG's website following the resolution
process in EPA Manual 2750. No further response is required on Recommendation 4.
We will post this report to our website at www.epa.gov/oig.
-------
EPA Can Better Reduce Risks From Illegal
Pesticides by Effectively Identifying Imports
for Inspection and Sampling
17-P-0412
Table of Contents
Chapters
1 Introduction 1
Purpose 1
Background 1
Responsible Offices 5
Scope and Methodology 5
2 EPA Has Not Met Its Inspection Frequency Goal for
Imported Pesticides 7
EPA Regions Have Not Met the CMS Inspection Frequency 7
OECA Lacks Regional Data and Feedback on Its
Imports Focus Area 12
Conclusion 13
Recommendations 13
Agency Comments and OIG Evaluation 13
3 EPA Can Better Plan How to Use ACE Capabilities to
Inspect and Sample Imported Pesticides 14
EPA Needs Training and Guidance on How to
Use ACE for Targeting 14
EPA Regions Could Improve Coordination With CBP on
Pesticides Without Import Notices 15
Conclusion 15
Recommendations 16
Agency Comments and OIG Evaluation 16
Status of Recommendations and Potential Monetary Benefits 17
Appendices
A Agency Response to Draft Report and OIG Evaluation 18
B Agency Supplemental Response to Draft Report 28
C Distribution 31
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Chapter 1
Introduction
Purpose
The purpose of this report was to determine whether the U.S. Environmental
Protection Agency's (EPA's) Federal Insecticide, Fungicide and Rodenticide Act
(FIFRA) import inspection program is effectively identifying imported pesticides
for inspection and sampling,1.for the purposes of deterring imports of harmful
pesticides and protecting human health and the environment.
Background
A pesticide is any substance or mixture of substances—and a pesticide device is
an instrument—intended for preventing, destroying, repelling,
mitigating or trapping any pest.
Illegal imports of pesticide products
from other countries can present
significant human health and
environmental risks, and have been
linked to poisonings of adults,
children and pets (see box for an
example). Interception of such
pesticides before they enter the
United States is critical. Illegal
pesticide imports include a wide
range of products, including a
variety of high-risk unregistered,
misbranded, adulterated, counterfeit
or imitation pesticides produced at
unregistered establishments or by
using unauthorized sources of
active ingredients. In addition, the
EPA has stated that illegal imports
of pesticides can create an unfair
playing field, presenting significant
financial impacts for those
companies importing and selling
legal products.
1 The agency identified non-inspection activities that support the FIFRA imports program. These can include desk
audits, producer establishment and marketplace inspections with an imports component, compliance assistance for
importers, and participation in international working groups.
Example of an Illegal Pesticide:
Insecticide Chalk
Chinese
Insecticide
Chalk
(EPA photo)
Illegal insecticides manufactured to resemble
blackboard chalk sold under various trade
names—including Pretty Baby Chalk,
Chinese Chalk, and Miraculous Insecticide
Chalk—are dangerous. These may be sold in
a neighborhood store or on the street for
about $1 a box. These products are mostly
imported illegally from China, and often bear
a label in both English and Chinese.
Sometimes the manufacturer claims that the
chalk is "harmless to human beings and
animals" and "safe to use." Children can
easily mistake insecticide chalk for
blackboard chalk or put it in their mouths.
State agencies have reported illnesses of
children linked to ingestion or handling of the
chalk. Some insecticide chalks can cause
serious health problems, including vomiting,
stomach pains, convulsions, tremors, loss of
consciousness, and serious allergic reactions.
Source: EPA
17-P-0412
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The EPA regulates pesticide and pesticide device imports in accordance with FIFRA.
Section 17(c) of FIFRA and the corresponding U.S. Customs and Border Protection
(CBP) regulations (19 CFR §§ 12.110-12.117) require any importer of a pesticide or
device into the United States to submit a Notice of Arrival (NOA) to the EPA prior
to arrival of the shipment. Prior to December 31, 2016,2 all NOA forms were sent to
the EPA regional office having jurisdiction over the port of entry. EPA regions
would review, evaluate and advise on the disposition of the import shipment to CBP
at the port of entry. Once the EPA's evaluation is completed, the NOA is annotated,
signed and dated by the EPA case officer and returned to the importer for
presentation to CBP at the time of entry. The shipment is then released, detained or
denied entry by CBP based on the EPA recommendation.
According to the EPA, inspections are the "core" of the FIFRA compliance
monitoring program. Inspections are intended to prevent the unlawful entry of
pesticides into the United States, help bring regulated entities into compliance,
and collect evidence to take appropriate enforcement actions. The EPA's
10 regional offices are the primary source of inspections and enforcement for
imported pesticides. States may become involved through region-to-state referrals
to monitor post-entry import compliance. States may also encounter imported
products during the course of other compliance monitoring inspections.
Enforcement Priority Placed on Imported Pesticides
Annual Commitment System
The EPA's Office of Enforcement and Compliance Assurance (OECA) monitors
regional, state and tribal implementation activities using regional and state results
entered in OECA databases, the Annual Commitment System (ACS), and data
collected in the implementation of national enforcement initiatives. For the
FIFRA program, the ACS commitment for each EPA region is a minimum of 10
FIFRA inspections; this may or may not include import inspections. According to
OECA, the types of inspections conducted depend on each region's priorities.
National Program Manager Guidance
Since fiscal year (FY) 2009, OECA has identified enforcement against illegal
importation of pesticides as a national priority through its National Program Manager
Guidance (NPMG). The goal of priority setting is to focus the agency's compliance
monitoring efforts on program areas with the greatest need first. To support this
national priority, the NPMG suggested activities for EPA regions that include:
• Monitoring pesticide import compliance through inspections at entry ports
and designated destination points (e.g., after imported products have been
released by CBP and have entered U.S. commerce).
2 As of December 31, 2016, the EPA started its required transition to the CBP's Automated Commercial
Environment (ACE) system for electronic receipt and processing of NOAs for pesticide imports.
17-P-0412
2
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Collecting pesticide samples and submitting these samples to laboratories
for formulation analysis to ensure product composition complies with
terms of product registration.
As part of the NPMG priority-setting effort, the EPA also develops national
targeting strategies. The goal of targeting is to focus on the most significant
environmental problems within a priority area by identifying specific pesticide
products or producers that may pose the greatest risk of harm to human health or
the environment due to noncompliance. According to OECA staff, in FY 2015, as
a result of regional enforcement efforts, the EPA addressed 6.7 million pounds of
noncompliant pesticide imports and assessed just over $456,000 in penalties.
For FY 2015, the EPA's draft regional implementation strategy for its NPMG
priority focused on "high-risk" unregistered pesticides and importers with a
history of noncompliance, and significant importation activity from countries
frequently associated with noncompliant shipments. The implementation strategy
called for EPA regions to:
• Conduct inspections based on identified targets.
• Evaluate compliance and identify potential violations of FIFRA.
• Take samples of imported pesticides when potential discrepancies in
information provided by the importers are identified.
FIFRA Compliance Monitoring Strategy
In 2015, OECA issued its FIFRA Compliance Monitoring Strategy (CMS) to
work in conjunction with the NPMG. The CMS established an "aspirational"
compliance monitoring goal ("inspection frequency") for EPA regions to
voluntarily achieve in support of the NPMG's and EPA's national enforcement
priority focusing on imported pesticides:
• Inspect nationwide 2 percent of all imported pesticide shipments annually
(or 480 total inspections per year across all 10 EPA regions).3
• Target pesticide imports using for-cause and neutral scheme inspections as
well as pesticide formulation sampling.
While the CMS provides an aspirational goal, according to OECA, the EPA's ACS
measure of a minimum of 10 FIFRA inspections is considered to be the agency
goal and commitment for each region.4 The CMS provides guidance to the regions
on how to target inspections to raise compliance rates by focusing on identifying
3 The CMS estimated the total number of NOAs received to be 24,246 based on data collected from EPA regions
through July 2009.
4 Since FY 2010, the OECANPMG has included an ACS measure specifying that each EPA region should conduct
a minimum of 10 FIFRA inspections. This measure is not specific to import inspections. It can include the following
different types of FIFRA inspections: import, export, use, pesticide producer establishment, certified applicator,
restricted-use pesticide dealer, marketplace, worker protection standard, or Good Laboratory Practice inspections
and data audits.
17-P-0412
3
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specific pesticide products that may pose the greatest risk of harm to humans or the
environment. The CMS also states that the EPA can provide a deterrent effect by
maintaining a visible presence in the FIFRA-regulated community as a whole, and
lists FIFRA imports as a "core" area for deterrence purposes.
Import Inspections and Sampling
EPA regions conduct inspections to ensure that imported pesticides comply with
the requirements of FIFRA. Under FIFRA, the EPA conducts for-cause
inspections in response to a suspected violation based on aNOA review, a tip or
complaint, or as a follow-up to an ongoing investigation. The EPA can also
conduct neutral scheme inspections, which monitor
compliance based on a set of unbiased criteria rather
than information that a pesticide may be in violation.
During import inspections, EPA regional staff can examine
the pesticide labels for mandatory labeling requirements,
check for collateral labeling (such as books and pamphlets),
and check the condition of the entire shipment. EPA
regions can also collect formulation samples and submit
them to a laboratory for analysis to ensure the pesticide's
composition is not adulterated and complies with the terms
of its EPA registration. If the pesticide is in compliance, the
region then notifies CBP that the shipment can be
released to the importer. As illustrated in Figure 1, if a violation is found, the EPA
can take enforcement actions such as: denying a shipment entry with a Notice of
Refusal of Admission; issuing a Stop Sale, Use or Removal Order; or issuing a
fine or penalty. The EPA may also seek injunctive relief in certain circumstances
where a violation continues after the agency has taken an enforcement response.
1 -.---T
1
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Pesticides set aside to be inspected.
(EPA Office of Inspector General [OIG] photo)
Figure 1: NOA review process for imported pesticides
DETAIN FOR
INSPECTION
RELEASE THE
SHIPMENT
DENIED ENTRY
jeSs
SSURO: Stop Sale, Use or Removal Order
CAFO: Consent Agreement and Final Order
Source: EPA Region 6.
17-P-0412
4
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Automated Commercial Environment Database
The CBP's Automated Commercial Environment (ACE) is intended to be the
primary system through which the trade community reports imports and exports
and the government approves pesticide products for entry into the United States.
Executive Order 13659, Streamlining the Export/Import Process for America's
Businesses, issued February 19, 2014, aimed to significantly reduce processing
and approval times for importers and exporters.5 In response to Executive Order
13659, the CBP transitioned all partner government agencies—such as the EPA—
to begin using ACE on January 1, 2017. ACE electronically processes the
majority of NOAs, significantly reducing the need for manual review and
approval by the EPA. Importers can continue to file paper NOAs, and the EPA
will continue manual reviews and approvals as necessary.
Responsible Offices
OECA's Office of Civil Enforcement and Office of Compliance set national
priorities through the EPA's NPMG, and issue national guidance for conducting
FIFRA inspections and NOA reviews. OECA's Office of Compliance also
develops the EPA's inspection sampling guidance (documentation, how much to
collect, chain of custody, etc.) and conducts both basic and FIFRA-specific
inspector training.
The Office of Chemical Safety and Pollution Prevention provides as-needed
support to EPA regions on product registration, and its Biological and Economic
Analysis Division provides laboratory support to the regions for sampling analysis
of pesticide imports.
Scope and Methodology
We conducted this performance audit in accordance with generally accepted
government auditing standards. Those standards require that we plan and perform
the audit to obtain sufficient, appropriate evidence to provide a reasonable basis
for our findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives. We conducted this audit from
May 2016 through July 2017.
We reviewed relevant materials, including FIFRA implementing regulations, and
EPA procedures and guidance for pesticide imports. Our review included
documents such as OECA's 2015 Compliance Monitoring Strategy for FIFRA,
5 The International Trade Data System, as described in Section 405 of the Security and Accountability for Every
Port Act of 2006 (SAFE Port Act) (Pub. L. 109-347), was established to modernize and simplify the way in which
partner government agencies—including the EPA—interact with the trade community by creating a single portal
through which filers submit the data elements required for import or export of cargo. CBP designed ACE to provide
that "single window" for the electronic filing of import entries.
17-P-0412
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OECA's NPMG (FYs 2010-2017), the EPA 2013 FIFRA Inspection Manual, the
OECA National Guidance for Review and Processing of Notice of Arrivals for
Pesticides and Devices, regional guidance and procedures for pesticide imports,
and EPA Office of Environmental Information guidance on CBP's ACE portal
system.
We gathered data from all 10 EPA regional offices and selected seven (Regions 4,
5, 6, 7, 8, 9 and 10) as the focus of our evaluation.6 We reviewed import
inspection reports from the selected regions. We reviewed pesticide import
sampling reports from EPA Region 10. We interviewed personnel from the
Georgia Department of Agriculture, Pesticides Division, about federal inspections
conducted on behalf of EPA Region 4.
We interviewed OECA staff, Office of Pesticide Programs staff, Office of
Environmental Information technical staff, and EPA regional pesticide and
enforcement managers and staff. We also interviewed regional FIFRA import
coordinators and inspectors to better understand the FIFRA regional import
review and inspection process.
We reviewed CBP regulations regarding pesticide imports. We interviewed CBP
personnel who work with EPA Regions 5, 9 and 10 about their roles and
responsibilities in monitoring, inspecting and detaining pesticide imports, as well
as their roles in coordinating with EPA regional FIFRA import coordinators and
inspectors.
We reviewed the NOA databases for Regions 6 and 9, as well as OECA's
SharePoint website for FIFRA Import Coordinators.
We also interviewed U.S. Food and Drug Administration staff regarding their
Predictive Risk-based Evaluation for Dynamic Import Compliance Targeting
program. We reviewed information on this targeting tool provided by the
U.S. Food and Drug Administration.
6 We collected NOA and inspection totals from all 10 EPA regions for FYs 2015 and 2016 (see Table 1).
17-P-0412
6
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Chapter 2
EPA Has Not Met Its Inspection Frequency
Goal for Imported Pesticides
In FYs 2015 and 2016, EPA regions did not meet the agency's voluntary
frequency goal of inspecting 2 percent of all imported pesticide shipments
nationwide. In FY 2016, the 10 EPA regions combined conducted only 73
inspections of 46,280 shipments of imported pesticides. This is an inspection rate
of 0.002; 2 percent of the 46,280 would have been 926 inspections. We found that
in two EPA regions, inspections were more likely to be conducted close to the
EPA regional office rather than where the greatest number of pesticide shipments
enter the region. In the last 5 years, the seven EPA regions we reviewed only
tested the product composition of seven products out of approximately 145,000
shipments. The EPA's strategic planning for inspecting and sampling imports did
not take into account regional resources available. Further, regional participation
is also considered voluntary. These challenges create a risk that the EPA cannot
effectively detect misrepresentations, errors and discrepancies of pesticide
shipments, or deter the importing of harmful pesticides.
EPA Regions Have Not Met the CMS Inspection Frequency
The EPA only inspected 0.002 of all known shipments of pesticides imported into
the United States in FYs 2015 and 2016 (Table l).7
Table 1: EPA regional NOA reviews and inspections in FYs 2015 and 2016
EPA Region
NOAs (FY 2016)
Inspections
NOAs (FY 2015)
Inspections
Region 1
2,212
0
2,018
4
Region 2
8,151
13
6,608
11
Region 3
1,130
8
1,239
5
Region 4
6,093
3
3,819
N/A
Region 5
5,411
12
5,950
9
Region 6
14,106
5
8,573
10
Region 7
1,845
14
2,202
3
Region 8
523
3
610
3
Region 9
4,326
9
3,737
6
Region 10
2,483
6
2,020
4
Totals
46,280
73, or .002
32,957*
55, or .002
* Region 4 is excluded from this total because it was unable to provide the number of inspections for FY 2015.
Source: EPA OIG.
7 In FY 2015, there were an additional 48 state-led FIFRA import inspections (using federal credentials), 78 percent
of which were conducted in the U.S. territories of the Commonwealth of the Northern Mariana Islands (23) and
Puerto Rico (14). In FY 2016, there were 64 state-led FIFRA import inspections, 50 percent of which were
conducted in the Commonwealth of the Northern Mariana Islands (27) and Puerto Rico (5).
17-P-0412
7
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This is significantly below the agency's CMS frequency goal of inspecting
2 percent of all shipments of imported pesticides; 2 percent of the 46,280 would
have been 926 inspections. Regional staff are focused on completing NOA
reviews as required under FIFRA and CBP regulations.
A Region 5 import inspector said noncompliance issues
(such as torn, missing or unreadable labels and leaks from
containers) can be found during inspections, including
routine inspections, but cannot be detected through a review
of a NOA for a shipment
OECA's 2015 FIFRA CMS provided national pesticide
compliance monitoring expectations to EPA regions. The CMS
established an aspirational and voluntary frequency goal of
inspecting 2 percent (approximately 480 total inspections
across all 10 EPA regions) of all shipments of imported
pesticides each year. However, as of our review, the regional
offices had committed to conducting only 10 FIFRA
inspections per year, which may or may not include any import
inspections. The CMS stated that the aspirational frequency
goal''presume[s] adequate funding and resources and,
therefore, the actual number of inspections conducted may
differ from the frequencies set forth."
The large gap between the current agreed-upon commitment level of inspections and
the frequency goal indicates a disconnect that needs to be addressed, given funding
and resources. OECA headquarters staff stated that no analysis of available
resources or regional input was used to develop this CMS frequency goal. It is
unclear how regions without "adequate funding and resources77 will achieve the
inspection frequency goal, or what the performance expectation is for regions
without these resources.
Some EPA Regions Are Not Inspecting at High-Traffic Ports
Our review of two EPA regions (Regions 5 and 6) found that when some EPA
inspections occur, they are more likely to be conducted in close proximity to the
respective regional office rather than in areas where the greatest number of imported
pesticides shipments are entering that region. For example, between FYs 2012 and
2015, Region 6 did not conduct any inspections at the port of Laredo, Texas, even
though it was the busiest port in the region, with 21,549 NOAs for shipments of
imported pesticides received. Instead, all 29 inspections conducted by Region 6 took
place close to the EPA's regional office in Dallas, Texas, where only 639NOAs
were received (Figure 2).
Pesticide import screening area.
(EPA OIG photo)
17-P-0412
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Figure 2: EPA Region 6 high-traffic ports and inspection locations (FYs 2012-2015)
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Flag denotes inspection location and inspection numbers. The circles show the number of NOAs
for shipments of imported pesticides received by location. (Source: EPA OIG)
Similarly, in Region 5, there were no import inspections conducted at its busiest
port—Port Huron, Michigan—during FYs 2012 through 2016, where 9,682
NOAs for imported pesticide shipments were received (Figure 3). Region 5 staff
said that budget constraints on travel impact their ability to inspect ports. In
Region 5, about 81 import inspections were conducted near the regional office in
Chicago, Illinois, where 4,375 NOAs were received.
Figure 3: EPA Region 5 high-traffic ports and inspection locations (FYs 2012-2016)
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Flags denote inspection locations and inspection numbers. The circles show the number of NOAs
for shipments of imported pesticides received by location. (Source: EPA OIG)
17-P-0412
9
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The NPMG suggests that EPA regions should monitor import compliance through
inspections at entry ports and designated destination points to assist with
deterrence. The CMS further emphasizes the need for "maintaining a visible
presence in the FIFRA-regulated community" for pesticide imports to help deter
noncompliant imports. OECA headquarters staff said that a key method to
maintaining this visible presence is conducting an adequate number of on-the-
ground inspections so that industry is aware that the EPA is monitoring
compliance. With near zero inspection presence at high-volume ports in some
EPA regions, the agency is not maintaining the visible presence called for in its
CMS. For example, a regional manager indicated the particular region was once
targeted by the pesticide import industry as the port of choice for import entry
because of a lack of inspections. This creates the risk of noncompliant pesticides
entering the United States.
Some Regions Are Not Conducting Neutral Scheme Inspections
Further, the CMS encourages the EPA regions to conduct both for-cause and
neutral scheme inspections. However, we found that some regions were not
conducting neutral scheme inspections. Neutral scheme inspections monitor
compliance based on a set of criteria rather than information that a violation has
occurred or is occurring; these inspections can rely on random selection or selection
by relevant statistics. EPA Regions 4, 6, 7 and 9 only conducted for-cause
inspections initiated in response to an already-suspected violation identified from a
tip, complaint or information on a NO A. Regions 5, 6, 8 and 10 conducted some
neutral-scheme FIFRA import inspections. OECA staff said that the agency prefers
that regions conduct for-cause inspections because that means there is a suspected
violation and the ability for the agency to stop potential harm. However, a review
of Region 5 inspection reports showed that neutral scheme
inspections found instances of FIFRA noncompliance.8
EPA Regions Sample Few Imported Pesticides
In the past 5 years, of the seven regions reviewed, Regions 4, 7
and 10 sampled seven imported pesticides for product formulation
out of an estimated 145,000 known pesticide shipments to these
seven regions. Region 10 is the only current "active" sampling
region. Regions 5, 6, 8 and 9 do not conduct any product
formulation analysis, even though these regions have done so in
the past.9 Some regions that do not sample instead emphasize label
review, and photograph actual labels or containers from imported
pesticides during inspections for comparison to EPA product
registrations.
EPA staff sampling pesticide
imports. (EPA Region 10 photo)
8 Noncompliance issues identified included labels on imported pesticides that do not match EPA-approved labels,
imported goods missing labels, and pesticide containers leaking pesticide liquid and residue.
9 On July 28,2015, OECA provided training to EPA regions on how to sample pesticides shipped in bulk containers
and provided each region with equipment.
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For FYs 2013, 2016 and 2017, OECA's NPMG directed EPA regions to review
NOAs for potential discrepancies relating to the source of active ingredients and
countries of origin. Two regions said that they do not have the capability to
analyze samples (e.g., no laboratory nearby, laboratory lacking formulation
analysis expertise). Other EPA regions indicated they did not see the benefit of
sampling, or rely on the NOA review process to refuse entry of a shipment
without having to sample. Representatives at the agency's designated
headquarters laboratory for sampling analysis said they do not actively promote
their pesticide formulation analysis capabilities because they do not have the
resources to properly assist all 10 EPA regions.
OECA headquarters staff said that, over the past several years, the EPA has seen
an increase in pesticide imports (as well as those that are domestically produced)
having modified or "off-spec" product formulations that are different from their
EPA-registered formulas. Since formulation sampling is so limited, the EPA
cannot validate whether product composition of imports is a potential threat, or
demonstrate the value of sampling for regions that are not actively doing it.
EPA National Targeting Results in Few Inspections
Our review of two EPA regions (Regions 6 and 9) found that the EPA's national
targeting effort may result in only a few imported pesticides being identified by
the regions for inspection. For FY 2015, the EPA developed a list of targeted
manufacturers and pesticide importers for each region to pursue neutral scheme
and for-cause inspections. We compared the electronic NOA databases for
Regions 6 and 9 to regional inspection reports. We found that for the 11 targeted
importers in these two regions, only one inspection was conducted despite receipt
of 4,637 NOAs from the 11 importers during this period. The agency provided
data that showed that only three EPA regions conducted a few import inspections
based on targeting efforts.
The EPA also initiated another national-level targeting effort through its
participation in the Commercial Targeting Analysis Center (CTAC).10 According
to a former EPA liaison for CTAC, the focus of the targeting was to review NOAs
from certain pesticide importers with "more scrutiny." The CTAC targeting plan
instructs EPA regions to inspect and sample "as appropriate."11 However, the
former liaison further added that a targeting effort is not intended to result in a
rise of inspection events.
10 The EPA is a member agency of the CTAC, which is a CBP-led inter-agency workgroup designed to streamline
and enhance federal efforts to address import safety issues. The CTAC combines the resources and manpower of the
CBP and other government agencies to protect the American public from harm caused by unsafe imported products
by improving communication and information-sharing, and reducing redundant inspection activities.
11 The targeting plan states: "EPA regional inspectors will conduct import entry document reviews and conduct
pesticide import inspections, as appropriate, based on identified targets ... at targeted ports of entry and take samples
of imported pesticides when potential discrepancies are noted, including but not limited to the country of origin and
sources for active ingredients used to produce registered pesticides as identified on their Confidential Statements of
Formula."
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The CMS states that the goal of targeting is to focus on the most significant
environmental problems within a priority area by identifying specific pesticide
products and producers that may pose the greatest risk of harm to human health or
the environment due to noncompliance. The agency's FY 2015 NPMG draft
FIFRA imports implementation strategy also details the use of inspections for
evaluating compliance and identifying potential violations of FIFRA. A targeting
strategy focused primarily on reviews of NOAs does not provide more assurance
that noncompliance by high-risk importers and pesticides are detected.
Example of a Targeting Strategy
EPA Region 10 has developed a targeting strategy
that includes risk-based criteria to help inform a
decision on whether to inspect an imported pesticide.
This strategy uses criteria such as product label
signal words (e.g., danger, skuli and crossbones),
toxicity, completeness and accuracy of the NOA,
country of concern, and compliance history to
determine an overall score or "targeting value."
Based on this score, an import is assigned an
inspection priority of high, medium or low. Since
2005, Region 10 stated that this strategy has resulted
in over 15 million pounds of pollution reductions and
more than $65,000 in penalties, and that recent
inspections have showed an increase in compliance
with FIFRA.
OECA Lacks Regional Data and Feedback on Its Imports Focus Area
OEC A headquarters staff said that regional analysis of resources is considered
during the setting of regional ACS commitments for FIFRA inspections. The
inspections negotiated may or may not include pesticide imports. OECA said that
regional resources were not considered to develop its aspirational inspection
frequency or national targeting strategies. Any inspections or sampling done by
the regions in support of these strategies are considered supplemental. OECA
headquarters staff rely primarily on the regions to determine what activities to
pursue. This can include non-inspection compliance and enforcement activities
that support the FIFRA imports program.
OECA formally monitors the progress of EPA regions toward the ACS commitment
of conducting 10 FIFRA inspections (which may or may not include imports).
However, OECA headquarters does not monitor or evaluate the progress of regional
offices related to achieving the CMS voluntary inspection frequency or the activities
in its national targeting strategies.12 At the conclusion of one of the agency's
targeting documents, it states that "Regions will report results for FY 15 imports
enforcement activities" to OECA. When asked, OECA could not share with us the
results because the regions did not provide OECA with any information.
12 OECA participates in regular conference calls and issues specific consultations for regional import coordinators.
A port located in EPA Region 10.
(EPA photo)
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An OEC A staff member told us that headquarters generally compiles any
available information related to the strategies themselves from EPA databases. As
a result, compliance monitoring activities suggested in the CMS and targeting
strategies for EPA regions to pursue are not clearly linked to what resources the
regions have available to accomplish them. Without monitoring, the EPA lacks
information on regional inspection and non-inspection activities in order to
evaluate effectiveness, update strategies in response to progress made, and
communicate achievements.
Conclusion
EPA regions face challenges meeting the 2 percent aspirational inspection
frequency for pesticide imports. With a near zero inspection presence at high-
volume ports in some EPA regions, the agency is also at risk of not maintaining
the visible presence called for in its CMS. The low rate of inspections and product
sampling is a result of the agency's lack of internal controls over strategic
planning and accountability. This creates a risk that the EPA's current strategies
are not detecting misrepresentations, errors and formulation discrepancies of
actual imported pesticides.
Recommendations
We recommend that the Assistant Administrator for Enforcement and
Compliance Assurance:
1. Establish national compliance monitoring goals based on
assessment and consideration of available regional resources.
2. Implement internal controls to monitor and communicate progress
on regional goals.
Agency Comments and OIG Evaluation
In the EPA's official comments, the agency disagreed with Recommendation 1
and proposed no further corrective action. The agency partially agreed with
Recommendation 2, but it did not propose a corrective action that met the full
intent of the recommendation. In its August 16, 2017, supplemental response, the
EPA proposed a revised corrective action for both Recommendations 1 and 2.
However, this action does not satisfy the full intent of the recommendations.
Therefore, these recommendations are unresolved. The agency also provided
technical comments on the draft report, which we incorporated into our final
report as appropriate.
The EPA's detailed official response is in Appendix A and its supplemental
response is in Appendix B.
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Chapter 3
EPA Can Better Plan How to Use ACE Capabilities to
Inspect and Sample Imported Pesticides
The EPA does not have a plan or training on how regions can best use the
capabilities and information available from CBP's ACE system to target future
inspections and sampling. The EPA works with local CBP staff when EPA
regions are alerted to potential illegal pesticide imports not found during the
EPA's NO A reviews. Guidance or protocols for how EPA regions will coordinate
with CBP on activities outside the automated import review process will help
ensure that the EPA is notified by CBP of any potential illegal pesticides not
found during the EPA's NOA reviews.
EPA Needs Training and Guidance on How to Use ACE for Targeting
As of December 31, 2016, the EPA started its required transition to the ACE
system.13 Prior to ACE, regional import coordinators were required to manually
review each NOA received.14 EPA Office of Environmental Information staff said
ACE will provide the EPA with access to previously unavailable information on
shipments and provide the EPA with the ability to produce reports that will assist
the regions with targeting. ACE also allows EPA regions to routinely stop
incoming shipments or ask for re-delivery of a shipment from an importer.
The purpose of the ACE system is to automate electronic review of NOAs. ACE
will review the electronically submitted NOAs. If all fields are correctly filled in,
the system will in most cases automatically release the pesticide shipment. ACE
will generally only forward to import coordinators for their review NOAs with
either erroneous or missing information. OEC A staff said it will take the agency
the next year or beyond to determine what activities will be the new or additional
focus of regional import coordinators.
Both OEC A headquarters and regional import staff said ACE would allow for
additional data mining to target inspections. EPA Office of Environmental
Information staff said the information in ACE can be used by EPA regions to also
develop their own targeting strategies. The CMS states that the goal of targeting is
to focus on the most significant environmental problems within a priority area by
identifying specific pesticides or producers that pose the greatest risk of
noncompliance. Using ACE for risk-based prioritization of inspections and
13 According to agency staff, during the time of our review, only about 10 percent of pesticide imports were going
through the ACE portal; regional coordinators were still reviewing 90 percent of the NOAs manually for the first
year.
14 On August 29, 2014, OECA issued national Guidance for Review and Processing of Notice of Arrivals for
Pesticides and Devices to ensure the consistency of NOA reviews across EPA regions.
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sampling would help to ensure that the agency is not only deterring bad actors but
targeting certain pesticides that pose the greatest risk to people and the
environment.
EPA Regions Could Improve Coordination With CBP on Pesticides
Without Import Notices
Both OECA headquarters and EPA regional staff said that local CBP staff
generally alert the EPA to illegal pesticides not found during the NOA review.
These illegal products include pesticides entering
without an EPA-approved NOA and unregistered
products.15 However, most of the EPA regions we
spoke with work with CBP on an as-needed basis
following their NOA reviews. None have written
guidance or protocols for working with CBP on
activities related to illegal pesticides without NO As.
The EPA FIFRA Inspection Manual states that it is up
to the regional offices to maintain a close cooperative
working relationship with CBP, as each port of entry
may follow a somewhat different protocol. During our
interviews with EPA regional staff, we found that
most EPA regions maintained varying relationships
with CBP staff based on local protocols.
Guidance or protocols specific to each EPA region's
relationship with CBP for illegally imported
pesticides would help assist with ongoing
identification of illegal pesticide imports not found
during the EPA's review of NOAs.
Conclusion
With the automated processing of NOAs through ACE, regional import
coordinators will now have more opportunities to focus on targeting imported
pesticides for inspection. Guidance or protocols specific to each EPA region's
relationship with CBP for illegally imported pesticides outside of the agency's
NOA review process would help to ensure that EPA regions are notified when
15 For example, in June 2016, the CBP office from the port of Los Angeles notified EPA Region 9 about a
suspicious shipment of devices imported from China. Region 9 determined that the devices did not contain a
valid EPA Establishment Number, and were therefore determined to be misbranded in accordance with
FIFRA Section 12. EPA Region 9 subsequently notified the Los Angeles CBP office that the shipment
should be "Denied Entry^-Refused Delivery into the United States pursuant to the authority of Section 17(c)
of FIFRA."
Newspaper Reports on Import
Seizures by EPA and CBP
U.S. EPA and Customs joint
operations at Southern California
ports result in fines and seizure of
illegal engines and pesticides
LOS ANGELES — On January 19, 2017,
the U.S. Environmental Protection
Agency and U.S. Customs and Border
Protection announced $217,998 in fines
and more than 5,325 items seized or
denied entry to the United States. These
are the latest results of continued joint
operations at the ports of Los Angeles
and Long Beach targeting foreign-made
engines, including scooters, ATVs,
chainsaws and construction equipment
without proper emission controls, as well
as pesticides that violate federal law.
Source: Highland Community News,
Highland, California
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these types of shipments are discovered, and that inspection and sampling-related
activities for these illegal pesticides are carried out. Guidance in this area
increases assurance that the agency is managing or reducing its risk concerning
deterring bad actors and targeting pesticides that pose the greatest risk to people
and the environment.
Recommendations
We recommend that the Assistant Administrator for Enforcement and Compliance
Assurance:
3. Develop agency guidance and training for EPA regions on how to use
the Automated Commercial Environment system for regional
targeting of importers, manufacturers and pesticide products.
4. Direct each EPA region to develop guidance or protocols that define
how the region will coordinate with local U.S. Customs and Border
Protection offices on illegal pesticides that are imported without
Notices of Arrival.
Agency Comments and OIG Evaluation
In the EPA's official comments, the agency agreed with Recommendation 3, but
it did not provide corrective actions that meet the intent of the recommendation.
In its August 16, 2017, supplemental response, the EPA proposed revised
corrective actions. This revised action still does not meet the full intent of the
recommendation. Therefore, Recommendation 3 is unresolved.
The agency agreed with Recommendation 4 and provided appropriate corrective
actions. The agency also provided technical comments on the draft report, which
we incorporated into our final report as appropriate.
The EPA's detailed official response is in Appendix A and its supplemental
response is in Appendix B.
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Status of Recommendations and
Potential Monetary Benefits
RECOMMENDATIONS
Rec.
No.
Page
No.
Subject
Status1
Action Official
13 Establish national compliance monitoring goals based on
assessment and consideration of available regional resources.
13 Implement internal controls to monitor and communicate progress U
on regional goals.
16 Develop agency guidance and training for EPA regions on how to
use the Automated Commercial Environment system for regional
targeting of importers, manufacturers and pesticide products.
Assistant Administrator
for Enforcement and
Compliance Assurance
Assistant Administrator
for Enforcement and
Compliance Assurance
Assistant Administrator
for Enforcement and
Compliance Assurance
Planned
Completion
Date
Potential
Monetary
Benefits
(inSOOOs)
16 Direct each EPA region to develop guidance or protocols that
define how the region will coordinate with local U.S. Customs and
Border Protection offices on illegal pesticides that are imported
without Notices of Arrival.
Assistant Administrator
for Enforcement and
Compliance Assurance
9/30/18
1 C = Corrective action completed.
R = Recommendation resolved with corrective action pending.
U = Recommendation unresolved with resolution efforts in progress.
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Appendix A
Agency Response to Draft Report
and 0/G Evaluation
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imports can present significant human health and environmental risks. Because of these risks, OECA
and the regional offices have focused resources in this area and made significant progress in
intercepting noncompliant products and returning them to compliance before entry, or preventing
those products from entering into U.S. commerce. The quantities of noncompliant pesticide imports
that are addressed through OECA's national imports compliance monitoring and enforcement efforts
greatly exceed the amount the Agency addressed ten years ago. The Report draws a direct correlation
between the numbers of inspections EPA conducts and the amount of illegal imports EPA is able to
identify; OECA feels strongly that this is an incorrect description of our program. In particular, the
Report fails to capture the variety of ways that EPA identifies unlawful imports and deters
noncompliance, which are described in more detail below.
OIG Response: The scope of this evaluation and report focuses on how the EPA is identifying
imports specifically for inspection and sampling. Our focus on inspection and sampling activities
within the FIFRA program reflects the emphasis placed on these activities in OECA monitoring
and enforcement guidance to EPA regions. Since FY 2009, the OECA NPMG has identified
FIFRA imports as a national enforcement priority. To support this priority, the NPMG lists
inspections and sampling as compliance monitoring activities that the regions should conduct. The
ACS measure for the FIFRA NPMG is a minimum of 10 FIFRA inspections conducted by EPA
regions. OECA's FY 2015 Draft FIFRA NPMG Regional Implementation Strategy also
emphasizes two compliance activities, inspections and sampling. The OECA CMS for FIFRA
imports (2015) establishes an "aspirational" inspection frequency of 2 percent of all FIFRA
imports nationwide and states that the EPA should conduct both for-cause and neutral scheme
inspections.
EPA has significantly strengthened the pesticide imports compliance assurance and enforcement
program over the past ten years. Program improvements include: (1) ensuring consistency across
regions when reviewing Notices of Arrival for Pesticides and Devices (NOA) through protocols and
guidance; (2) improving communications among regional import specialists through monthly
coordination calls and an intranet-based Import Forum for sharing information; (3) emphasizing
aggressive enforcement against noncompliant import products; (4) establishing import compliance as
a focus area in OECA's National Program Manager's Guidance (NPMG); (5) increasing regional
inspection capabilities so that each region has at least minimal capacity to conduct FIFRA
inspections, including import inspections; (6) providing pesticide bulk sampling training for the
regions and providing sampling equipment for those inspection activities; and (7) arranging for
analytical support from the National Enforcement Investigations Center (NEIC) and the Fort Meade
pesticides laboratory operated by the Office of Pesticides Program's (OPP) Biological Evaluation
and Assessment Division (BEAD) for regional pesticide enforcement cases, including imports cases.
OIG Response: The scope of our review did not include an assessment of all the EPA's
non-inspection compliance activities, enforcement or improvements to the FIFRA imports
program. Therefore, we cannot offer an independent opinion on the claimed strengths or
improvements. However, our report acknowledges several of the FIFRA program improvements
listed above that were related to the scope of our review, such as identifying imports for inspection
and sampling.
In addition, EPA has conducted activities to improve FIFRA imports compliance assurance and
enforcement generally, including: providing direct compliance assistance to importers,
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manufacturers, and brokers; engaging other countries through OECD working groups; and providing
FIFRA training to U.S. Customs and Border Protection (CBP) import specialists and inspectors to
help them identify regulated pesticide products. OECA has updated its enforcement database, ICIS,
to improve EPA's ability to track entry denial enforcement actions and their resulting environmental
benefits. Collectively, these efforts have created a much stronger pesticide imports enforcement
program that EPA continues to make significant strides towards improving.
OIG Response: This evaluation focused on the inspection and sampling activities of the FIFRA
imports program. We did not assess the extent or effectiveness of other import compliance
assistance and enforcement, or all external engagements undertaken by the agency. Our review
included discussions with CBP and EPA staff in Regions 5, 9 and 10 about coordinating on
inspections and identifying pesticides attempting to be illegally imported outside the NOA
process. Based on these discussions, we concluded that guidance or protocols specific to each EPA
region's relationship with CBP would help to ensure that the EPA is consistently notified about
shipments of imported pesticides without a NOA.
We disagree with the Report's premise that the numbers of inspections EPA conducts determines the
amount of illegal imports EPA is able to identify and deter. We deter the entry of noncompliant
pesticide products through a broad array of mechanisms, only one of which is on-site inspections. In
fact, import inspections are not one of the main approaches EPA uses to detect and prevent entry of
noncompliant pesticide products into United States commerce. Electronic investigations, tips and
referrals from CBP, and other (non-inspection based) investigatory tools are efficient and effective
ways to identify noncompliance. Import inspections are used primarily to confirm suspected
noncompliance (in the minority of instances where EPA is not able to confirm compliance using the
investigatory tools listed above), or to confirm a return to compliance for shipments that have been
denied entry due to a violation that can be corrected.
OIG Response: We concluded that low rates of inspections and formulation sampling can create a
risk that the EPA may not be identifying, or deterring, the import of pesticides harmful to people
or the environment. The OECA NPMG consistently suggests that EPA regions monitor
compliance through inspections at ports of entry, and the CMS suggests further engaging in both
for-cause and neutral scheme inspections and using targeting strategies to identify imports for
possible inspection.
One of EPA's best sources of information regarding suspect shipments attempting to enter the
country is CBP. CBP and EPA share regulatory authority at the border, and consistent with the
regulations, we rely on each other's expertise and procedures to identify and handle illegal
shipments. CBP frequently identifies pesticide imports for which no NOA was submitted and which
might require a NOA based on criteria EPA has provided to CBP to help identify such products. In
these cases, CBP notifies and then coordinates with EPA on an appropriate course of action, i.e.,
whether an inspection should occur, whether the shipment should be held and for how long, or
whether it should be released under bond, and CBP then responds to the broker or importer to
implement the response. This shared responsibility allows EPA to efficiently and effectively identify
noncompliant shipments. By utilizing CBP's authority to hold and direct the movement of
noncompliant shipments, EPA can determine whether an inspection and/or sampling is needed or
whether noncompliance is clear, in which case EPA would work with the importer to assure
compliance before releasing the shipment. EPA and CBP's coordination is now entering into a new
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electronic era with implementation of the Automated Commercial Environment I International Trade
Data System (ACE/ITDS). As that new process gets better established with the regulated trade
community, and as our regional pesticide import staff become more comfortable with how the
system operates and its capabilities, the ACE/ITDS system is expected to be a significant
enhancement for our compliance monitoring efforts.
OECA's current data system does not track many of our efforts to return goods to compliance before
they enter U.S. commerce. The system only tracks the enforcement actions that result in entry denial,
entry under a Stop Sale, Use or Removal Order (SSURO), or unlawful entries for which a penalty
was assessed. The data system does not account for the millions of pounds of noncompliant products
that are "delayed" entry while they are returned to compliance. Indeed, providing importers the
opportunity to return noncompliant products to compliance before they enter the domestic consumer
market, often with the understanding that a penalty action will follow for the illegal import,
represents a large part of this program's success in achieving compliance and deterrence. Although
EPA data does not capture these activities, the Report should acknowledge this substantial work, and
recommend working with EPA to improve tracking in this area.
OECA requests that the OIG reassess its basic assumption that inspections are the primary metric by
which to judge the success of the pesticide imports enforcement program, reconsider its findings
based on a review of the whole program, and revise the narrative of its Report accordingly. In the
attached "Technical Comments to the Draft OIG Report on FIFRA Imports Enforcement Program"
document, we have provided specific suggestions for revisions of the Report's text that more
accurately reflect the status of the FIFRA imports enforcement program and incorporate appropriate
recommendations.
OIG Response: The scope and focus of this evaluation was EPA regional inspections and
sampling in the context of the ACS measure, voluntary inspection frequency in the FIFRA CMS,
and suggested regional activities in NPMG. Our findings and recommendations are limited to how
imports are identified by EPA regions to inspect or sample. Based on the agency's response and
technical comments, we have made changes to the report where appropriate.
Recommendation 1: Strengthen internal controls by establishing national compliance monitoring
goals based on assessment and consideration of available regional resources.
OECA does not agree with this recommendation. While the OIG correctly notes the importance of
considering regional resources in developing commitments for inspections and other compliance
monitoring activities, OECA already assesses and considers available regional resources as part of
the Annual Commitment System (ACS), and its interplay with the FIFRA Compliance Monitoring
Strategy (CMS), the OECA NPMG, and the FIFRA Cooperative Agreement Guidance (CAG).
OIG Response: The OIG is recommending that OECA revise its current aspirational frequency
goal for import inspections to align more closely with what EPA regions can realistically achieve.
The Report seems to interpret the CMS inspection frequency for imports as a commitment that did
not take into consideration regional resources. As explained during the OECA/OIG meeting held on
May 11, 2017, the inspection frequency chart should not be taken out of context. The introduction to
that chart is very clear and explains the purpose of inspection frequencies and sets forth that:
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"Inspection frequencies are intended to help EPA, the states and tribes to understand and meet
today's challenges by providing benchmarks that set aspirational compliance monitoring goals. The
frequencies presume adequate funding and resources and, therefore, the actual number of inspections
conducted may differ from the frequencies set forth below." Further, the CMS reads, "[a]ctual annual
program commitments for ALL inspection types are negotiated as part of the cooperative agreement
process or are subject to the annual commitment system process. Individual regional, state and tribal
circumstances, including resource and workload issues, are addressed during those processes." A
proposed aspirational goal is not and was never intended to be a regional commitment. It is possible
that the Report has mistakenly interpreted the proposed inspection frequency for imports in the CMS
as a commitment by the regions to conduct inspections of 2% of all NOAs. It is not. Regional
resources are considered and incorporated, not in setting inspection frequencies in the multi-year
framework of the CMS, but, rather in the Annual Commitment System (ACS) process. Since the
inspection frequency "presumes adequate funding," inadequate funding can cause EPA to not meet
the aspirational goals in the CMS.
OIG Response: The report identifies this inspection frequency goal as voluntary, not as a regional
commitment. At the time of our review, we found that EPA had an inspection rate of 0.002 versus
the voluntary inspection frequency goal of 2 percent. The report states that the CMS voluntary
inspection frequency "presumes adequate funding." However, it is unclear from our review of the
CMS what "adequate funding" would be for each region or OECA's strategy to achieve this
aspirational goal.
The ACS process is conducted annually and specifically takes into consideration the regional
resources in developing the number of inspections to be conducted by program. Commitments made
during the ACS process are the annual compliance monitoring goals (not the inspection frequencies
in the CMS). The region commits to the negotiated number of inspections for the year. The FIFRA
ACS requirement specified, "A minimum of ten (10) FIFRA inspections will enable regional FIFRA
inspectors to manage the federal FIFRA program and retain the skills to adequately oversee
inspections conducted by FIFRA grantees." Depending upon the resources available, regions have
committed to a varying number of inspections as part of the ACS process. The number of those
resources committed to import inspections would depend on the balanced pesticide program
developed in that region.
The Report fails to place appropriate emphasis on the value of regional NOA reviews and other
import-related activities. Inspections are not the whole picture of import compliance monitoring.
Specifically, the CMS reads, "It is increasingly challenging to monitor compliance and maintain
adequate enforcement response capabilities in the face of a regulated community that continues to
grow in size and complexity. While still important, our traditional approach of conducting on-site
inspections and pursuing enforcement cannot keep up with expanding responsibilities. It is
imperative that compliance monitoring and enforcement agencies be flexible and creative in
designing approaches to identify and address violations that pose risk to human health and the
environment while maximizing available resources. Therefore, EPA is expanding the range of
compliance monitoring activities...." The CMS acknowledges that reducing risk and creating a
deterrent effect may be achieved by other means besides traditional inspections and these creative
solutions may be a viable way to maximize resources. In fact, where funding and resources have
been and will continue to be reduced, EPA will use many of these alternatives to on-site inspections.
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Reviewing NOAs and issuing denials and/or conditions is exactly the effective, flexible, creative
approach envisioned by this passage in the FIFRA CMS. EPA has the ability to prevent illegal
imports from entering the country without expending the resources necessary to conduct inspections
at a port of entry. The Report focuses almost exclusively on inspections and does not adequately
identify how NOAs provide an enforcement presence and serve a valuable function as a compliance
monitoring tool. As presented, the Report may lead readers to believe that people are at risk when the
number of inspections decline, when in fact, other compliance monitoring tools, like NOA reviews,
provide a strong enforcement presence and deterrent effect. The Report identifies the number of
NOA reviews in FY16 (almost 50,000) and FY 15 (almost 33,000) conducted by the regions, but
overlooks the significance of these efforts. These are an important, less resource intensive, more cost
effective way to accomplish compliance monitoring goals for imports.
OIG Response to Recommendation 1: This recommendation is unresolved. In response to the
EPA's comments on the draft report, the OIG has modified the wording of this recommendation in
the final report to better clarify the intent of the recommendation. The OIG is recommending that
OEC A set an aspirational inspection frequency that is more in alignment with the resources
available to EPA regions for conducting import inspections. In the EPA's supplemental response,
the agency proposed a corrective action to identify opportunities for strengthening internal controls,
establishing goals, and communicating progress specifically for non-inspection activities. However,
this action does not meet the intent of the recommendation. The OIG sees weaknesses in how the
EPA establishes aspirational inspection frequency and the agency's supplemental corrective action
committed to identifying opportunities for strengthening internal controls for only non-inspection
import-related activities.
Recommendation 2: Implement internal controls to monitor and communicate progress on regional
goals.
OECA disagrees in part and agrees in part. To the extent this recommendation focuses on monitoring
and communicating progress on regional inspections, OECA disagrees that current monitoring is
inadequate. Developing and reporting annual commitments through the ACS process is part of an
agency-wide effort that includes detailed guidance and procedures. However, OECA agrees with the
OIG that there may be an opportunity to improve the Agency's internal controls to better track and
monitor the other types of EPA activities, outcomes, and benefits of our imports compliance
monitoring and enforcement program. Such improvement in tracking will allow OECA to better
communicate the Agency's ability to effectively intercept and deter noncompliant and potentially
harmful pesticide imports in our effort to protect human health and the environment. OECA therefore
proposes as a corrective action that we consider opportunities for enhancement of current capabilities
to improve tracking of import-related compliance assurance activities, allowing better
communication of regional accomplishments.
This will build upon existing efforts to track, monitor and communicate progress on regional goals
through ACS, through the two National Pesticide Meetings per year, and the annual FIFRA
Enforcement Managers Meeting during which these specific issues are discussed. Existing efforts
also include the internal monthly import calls as well as monthly pesticide calls with regional, OECA
and OPP representatives in attendance. Further, import inspections conducted by state grantees are
well-monitored because they are only performed at the request of EPA and the results are referred to
EPA for enforcement response, if necessary.
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OIG Response to Recommendation 2: This recommendation is unresolved. In both the EPA's
official response and supplemental response, the proposed corrective action does not address
monitoring of import inspections and sampling; it focuses on tracking non-inspection compliance
and enforcement assurance activities. Since the proposed action does not also address monitoring
and reporting of import inspections and sampling, it does not meet the full intent of the OIG
recommendation.
Recommendation 3: Develop agency guidance and training on how EPA regions can use the
Automated Commercial Environment System for regional targeting of importers, manufacturers and
pesticide products.
EPA agrees with the recommendation that more training in this area will be helpful for the regions as
they learn how best to use ACE for targeting. Therefore, OECA will continue its efforts in
developing and providing guidance and training on how EPA regions can use the Automated
Commercial Environment System. EPA has already been working closely with each region to ensure
that all regions have staff with access to ACE and have been trained in the basic functions of the
system, as well as the enhanced capabilities available through ACE in particular.
OECA conducted a training pilot before ACE was fully implemented in December 2016 to ensure
that EPA regions set up group email boxes to receive email notifications from the ACE system for
electronically submitted NOAs, and that each person responsible for the review and approval of
NOAs had the proper training required by CBP in order to receive their ACE user access. EPA and
CBP scheduled "war room" meetings with participating importers to conduct "live" runs of
submissions of electronic NOAs. The "war room" sessions enabled EPA staff to learn: the steps to
review labels submitted electronically in ACE, how to gather and download data about the importers
and their import shipments, and how to electronically approve completed NOAs.
In addition, OECA has already conducted numerous regional, group, and one-on-one "live" webinar
training sessions to provide an introduction on how regional staff can generate, modify and schedule
ACE reports. OECA will continue to offer these training sessions and will also be available upon
request on an individual basis. As the regional staff become more comfortable with the electronic
system, trainings will be expanded to cover the more unique features of the system which will greatly
enhance regional targeting capabilities.
The move from the old paper process to the ACE/ITDS electronic process will take time for both the
trade community to make the transition and for the regions to become familiar with how ACE
handles these filings, how to review the records in ACE, and how to utilize appropriate
actions/messaging to the filer for each review. As the number of NO A filings in ACE increase, the
number of inquiries from the trade community on how to use the system increase, as does the number
of filing errors that require review and amendment. In addition, time and effort will also be spent
utilizing relevant features in ACE as part of the regions' overall operational coordination with CBP.
While several of the large importers are filing NOAs successfully in ACE, we expect the transition
will take at least a year for the overall trade community to become proficient at filing NOAs
electronically rather than on paper. Developing regional expertise with the ACE system will also take
time.
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OIG Response to Recommendation 3: This recommendation is unresolved. The agency's
proposed corrective action does not address the full intent of the OIG recommendation to provide
both guidance and training to all EPA regions. In the agency's supplemental response, the revised
corrective action is responsive to regional training, but it does not address the issue of developing
guidance that is included in this recommendation.
Recommendation 4: Direct each EPA region to develop guidance or protocols that define how the
region will coordinate with local U.S. Customs and Border Protection offices on illegal pesticides
that are imported without Notices of Arrival.
OECA agrees with this recommendation. OECA understands the OIG's concern that each region's
relationship with CBP is specific to that region and may result in some inconsistencies in approaches
nationally, and agrees with the OIG's observation, as stated in the Report, that new ACE capabilities
with respect to processing NO As provide an opportunity for the regions to have a more consistent
and effective working relationship with CBP. OECA will commit to requesting each region to draft a
functional protocol for how they coordinate with local CBP offices on illegal pesticides that are
imported outside of the normal NOA process.
It is worth noting that as of May 18th for commonly identified pesticide products and potential
devices, all filers must either file a NOA or indicate that they do not need to file a NOA (based on
their understanding of FIFRA requirements). ACE will provide the ability for the EPA regions to
periodically check the filings where the filers say they do not need to file a NOA to see if they in fact
should have filed one. EPA regions have not had visibility into those who did not file NOAs in the
past.
This new technical capability will allow CBP and EPA to become more effective at identifying
unlawful importation of pesticides. Additional guidance and protocols will be considered as the new
system is, over the course of this inaugural year, implemented and enforcement practitioners at both
agencies learn the nuances of the program and the need for guidance or protocols.
OIG Response to Recommendation 4: This recommendation is resolved. The OIG accepts the
proposed corrective action and scheduled completion date.
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Not in Agreement
No.
Recommendation
Agency Explanation/Response
Proposed
Corrective Action
1
Strengthen internal
controls by
establishing national
compliance
monitoring goals
based on assessment
and consideration of
available regional
resources.
Assessment and consideration of available
regional resources is already conducted and
is represented by the Annual Commitment
System (ACS).
No further action
proposed.
2
Implement internal
controls to monitor
and communicate
progress on regional
goals.
Existing internal controls regarding
inspections exist through the ACS
development and tracking process, National
Pesticide Meetings, annual FIFRA
Enforcement Managers Meeting, internal
monthly import calls, monthly pesticide
calls with regional, OECA and OPP
representatives, and EPA-requested import
inspections conducted by state grantees.
By September 30,
2019, consider
opportunities for
enhancement of
current capabilities
to improve tracking
of non-inspection,
import-related
compliance
assurance activities,
allowing better
communication of
regional
accomplishments.
In Agreement
No.
Recommendation
Agency Explanation/Response
Proposed
Corrective Action
3
Develop agency
guidance and
training on how
EPA regions can
use the Automated
Commercial
Environment
System for regional
targeting of
importers,
manufacturers and
pesticide products.
We can expand training efforts, working
closely with the Office of Environmental
Information (OEI) and the regions to
implement the new ACE/ITDS system.
Learning the system and how to use its new
capabilities is considered critical for
successful implementation of ACE/ITDS.
OECA will continue this effort in group
settings and one-on-one trainings.
Conduct at least two
(2) new group
training webinars
and one-on-one
personal trainings,
upon request, by
September 30, 2018.
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No.
Recommendation
Agency Explanation/Response
Proposed
Corrective Action
4
Direct each EPA
region to develop
guidance or
protocols that
define how the
region will
coordinate with
local U.S. Customs
and Border
Protection offices
on illegal pesticides
that are imported
without Notices of
Arrival.
Since each regional office deals with
different US CBP District Offices which are
uniquely managed, each region has
established its own protocol for how EPA
and CBP interact regarding pesticide
imports. The issue concerning pesticide
products being imported without filing an
NOA is partly being addressed through the
new ACE/ITDS system which will have the
capability to identify products commonly
identified as pesticides and require them to
file an NOA or explain why they do not
need to file an NOA. Regions will have the
ability to check those non-filers to see if, in
fact, they should have filed an NOA.
Nevertheless, each region should have an
established protocol providing guidance on
how CBP and each region should interact to
share information about illegal pesticide
imports.
OECA will request
each region
memorialize a
functional protocol
for how they will
coordinate with local
CBP offices on
illegal pesticides
being imported
without NOAs.
Regions will be
asked to have their
protocols in place by
September 30, 2018.
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Appendix B
Agency Supplemental Response to Draft Report
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
1 8 li
MEMORANDUM
OFFICE OF
ENFORCEMENT AND
COMPLIANCE ASSURANCE
SUBJECT:
FROM:
TO:
Supplemental Response to the Office of Inspector General Draft Report: "EPA
Can Better Reduce Risks From Illegal Pesticide Imports,"' dated June 27, 2017.
Report No. OPE-FY16-0025
David Hindin, Director
Office of Compliance
Office of Enforcement and Cpmpli
Susan Shinkman. Director
Office of Civil Enforcement
Office of Enforcement and Compliance Assurance
Jeffrey Harris, Director
Toxics, Chemical Management and Pollution Prevention Evaluations
Office of Program Evaluation
Office of Inspector Genera!
Assurance
On August 16, 2017, Jeffrey Hanis, Ganesa Curley, and Steve Weber of the Office of Inspector
General (OIG) met with managers and staff from OC and OCE. The parties discussed OECA's July
27, 2017 Response to the OIG Draft Report: EPA Can Better Reduce Risks From Illegal Pesticide
Imports. Presented below are changes to the table in OECA's Response that the parties discussed
would be acceptable for consideration in the OIG's final report:
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No.
Recommendation
Agency Explanation/Response
Proposed Corrective
Action
1
Strengthen internal
controls by establishing
national compliance
monitoring goals based on
assessment and
consideration of available
regional resources.
Assessment and consideration of
available regional resources for
inspections are already conducted
and is represented by the Annual
Commitment System (ACS).
By September 30,
2019, for non-
inspection import-
related compliance
assurance activities,
identify opportunities
for strengthening
internal controls,
establishing goals,
2
Implement internal
controls to monitor and
communicate progress on
regional goals.
Existing internal controls regarding
inspections exist through the ACS
development and tracking process,
National Pesticide Meetings, annual
FIFRA Enforcement Managers
Meeting, internal monthly import
calls, monthly pesticide calls with
regional, OECA and OPP
representatives, and EPA-requested
import inspections conducted by
state grantees.
and communicating
progress of regional
accomplishments.
3
Develop agency guidance
and training on how EPA
regions can use the
Automated Commercial
Environment System for
regional targeting of
importers, manufacturers
and pesticide products.
We can expand training efforts,
working closely with the Office of
Environmental Information (OEI)
and the regions to implement the new
ACE/ITDS system. Learning the
system and how to use its new
capabilities is considered critical for
successful implementation of
ACE/ITDS. OECA will continue this
effort in group settings and one-on-
one trainings.
Conduct at least two
(2) new group
training webinars by
September 30, 2018.
4
Direct each EPA region to
develop guidance or
protocols that define how
the region will coordinate
with local U.S. Customs
and Border Protection
offices on illegal
pesticides that are
imported without Notices
of Arrival.
Since each regional office deals with
different US CBP District Offices
which are uniquely managed, each
region has established its own
protocol for how EPA and CBP
interact regarding pesticide imports.
The issue concerning pesticide
products being imported without
filing an NOA is partly being
addressed through the new
OECA will request
each region
memorialize a
functional protocol
for how they will
coordinate with local
CBP offices on illegal
pesticides being
imported without
NOAs. Regions will
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ACE/ITDS system which will have
the capability to identify products
commonly identified as pesticides
and require them to file an NOA or
explain why they do not need to file
an NOA. Regions will have the
ability to check those non-filers to
see if, in fact, they should have filed
an NOA.
Nevertheless, each region should
have an established protocol
providing guidance on how CBP and
each region should interact to share
information about illegal pesticide
imports.
be asked to have their
protocols in place by
September 30, 2018.
If you have any questions or concerns, please contact the OECA Audit Liaison, Gwendolyn Spriggs,
at (202) 564-2439.
cc: Rosemarie Kelley, OECA/OCE
Gregory Sullivan, OECA/OCE
Lauren Kabler, OECA/OCE
Ed Messina, OECA/OC
Rochele Kadish, OECA/OC
Gwendolyn Spriggs, OECA/OAP
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Appendix C
Distribution
The Administrator
Chief of Staff
Chief of Staff for Operations
Deputy Chief of Staff for Operations
Assistant Administrator for Enforcement and Compliance Assurance
Assistant Administrator for Chemical Safety and Pollution Prevention
Agency Follow-Up Official (the CFO)
Agency Follow-Up Coordinator
General Counsel
Associate Administrator for Congressional and Intergovernmental Relations
Associate Administrator for Public Affairs
Principal Deputy Assistant Administrator for Enforcement and Compliance Assurance
Deputy Assistant Administrator for Chemical Safety and Pollution Prevention
Audit Follow-Up Coordinator, Office of the Administrator
Audit Follow-Up Coordinator, Office of Enforcement and Compliance Assurance
Audit Follow-Up Coordinator, Office of Chemical Safety and Pollution Prevention
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