Idaho's Air Enforcement Program
Office of Inspector General
Audit Report
Air
Idaho's Air Enforcement Program
E1GAF8-10-0018-8100249
Agency's Response
STATE OF IDAHO
OFFICE OF THE ATTORNEY GENERAL
ALAN G. LANCE
March 5, 1998
Ron Beeler
Division Inspector General for Audits
U. S . EPA Office of Inspector General
Western Audit Division
75 Hawthorne St., 19th Floor
Mail Code 1-1
San Francisco, CA 94105-3901
Dear Mr. Beeler:
Per your request, this letter is written to confirm that the Idaho Division of Environmental Quality (IDEQ) does
intend to withhold certain attorney client privileged documents from the audit the U.S. Environmental
Protection Agency, Office of Inspector General intends to conduct of IDEQ's air quality programs. Attorney
client privileged documents are exempt from disclosure under Rule 502 of the Idaho Rules of Evidence and the
Idaho Public Records Act, Idaho Code Section 9-340(1). Neither IDEQ nor the Attorney General's Office are
necessarily concerned that the I.G.'s office view such documents; however, once released, arguably the attorney
client privilege has been waived and any third party may obtain the documents. Obviously, this could
detrimentally effect an enforcement action.
For example, IDEQ is presently pursing an enforcement action against Penford Products. In addition a notice of
tort claim has been filed against the State of Idaho by residents living adjacent to Penford's faclty, and a 60 day

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notice of intent to sue under the Clean Air Act has been issued against Penford. Certainly, it would be extremely
disadvantageous for IDEQ to be forced to reveal its attorney cfient privileged documents to the parties,
especially those containing analysis of the strengths and weaknesses of the various matters at issue
In most cases, there probably won't be many attorney client privileged documents to withhold. However, in
cases where a Notice of Violation is issued. IDEQ submits to the Attorney General's Office a document entitled
Compliance Action Referral. This document provides a narrative summary of the violations listed in the NOV
and additional background information. Further, it provides the Attorney General's Office with a factual
chronology of sig ficant facility events. Although the I.G.'s office could probably construct the chronology
information upon review of the file, IDEQ may be able to separate this information from the Referral document
and release it to the I.G.'s office.
Please be assured that IDEQ and the Attorney General's Office desire to cooperate as fully as possible in the
audit process. Please do not hesitate to ask questions such as why certain actions were or were not taken. We
will make every attempt to give you a full and complete picture of each matter at issue. If you have any
questions regarding this letter, please do not hesitate to contact me or Doug Conde, Supervisor of Deputy
Attorneys General assigned to IDEQ, at (208) 373-0494.
Sincerely,
Lisa J. Kronberg
Deputy Attorney General
LJK/lvh
cc. Wallace N. Cory
Charles Resis
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
REGION 10
1200 Sixth Avenue
Seattle, Washington 98101
Reply To Attn Of. OAQ- 107
MEMORANDUM
SUBJECT: Region 10 Response to Draft Report on Idaho's Air Enforcement Program,
Draft Report No. E I GAF8-10-0018
FROM: Chuck Clarke

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Regional Administrator
EPA Region 10
TO: Truman R. Beeler
Divisional Inspector General for Audits
Western Audit Division
This is response to your July 31, 1998, memo to me and its attached Draft Report. As requested, we are
providing a separate statement with respect to each recommendation. As regards your request for a separate
statement of concurrence or nonconcurrence with the facts presented in each finding, to the best of our
knowledge the facts reported are accurate. We have not, however, mounted our own audit of all of the facts to
be able to absolutely confirm every one. However, we believe the facts and the findings are generally consistent
with our experiences involving the Idaho Air Enforcement Program. There are, though, a few instances in the
following response where we have expanded on the context or have a differing view on the findings.
In your memo you asked us to "consolidate DEQ's responses with those of the Region." The State's responses
are enclosed herewith; however, since we did not receive the State's response until mid-day today, we were
unable to do anything further with it and still meet your deadline.
Before I get to the specific responses to your findings and recommendations, I want to provide you some
background on activities we started working on with all four Region 10 States — even before the Idaho audit
began — which should have a significant impact on enforcement in all of our media programs. I am enclosing
copies of two documents: 1) a letter we sent 2/18/98 to each Deputy Director of the State Environmental
Agencies in Region 10 confirming a framework which had been negotiated and agreed to by the Agency
Directors for a process to identify and resolve issues related to enforcement in State programs; and 2) a memo
we sent 2/18/98 which memorializes an agreement by the four Region 10 States and EPA Region 10 on a set of
principles governing State program evaluations, including identification of broad areas of enforcement program
expectations. We believe these processes and agreements, along with
Printed on Recycled Paper
6ithe audit findings, will provide strong support in our efforts to improve Idaho's enforcement program and,
particularly, to develop a new and strengthened Compliance Assurance Agreement.
I also want you to know that EPA Region 10 has already taken a number of actions in the last several weeks to
begin addressing some of the major deficiencies identified in this audit. This has included frank and open
discussions at the highest levels of management in both agencies to jointly work through steps to improve
DEQ's Air enforcement program; and, the convening of an ad hoc EPA task force which is reviewing cases
examined by the audit and determining what types of action are needed on an expedited basis to appropriately
address existing SV problems. We will shortly be taking enforcement action on a number of these cases. In
addition, I am pleased to report that DEQ has begun to make significant progress with several cases on which
there had previously been little apparent action.
Our hope and intent is to work cooperatively with Idaho to secure the necessary program improvements.
However, we will not hesitate to exercise our Federal authorities should that be necessary to get results.
Chapter 2 Findings and Recommendations
Findings

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There are several places (particularly pages 13,14, and 16) where the State is quoted as saying in effect that they
assumed EPA was satisfied with the existing Compliance Assurance Agreement, with the State's support of
compliance assistance instead of enforcement, and with the level of State penalty collection. We do not agree
that those assumptions reflect the full situation. There have been innumerable in person and telephone
conversations — involving staff and management of both agencies — of the most direct nature in which EPA
expressed its dissatisfaction with the situation. In addition, the monthly Significant Violator (SV) calls
inevitably involved EPA pressure for more aggressive State performance, but with only grudging progress
occurring. EPA staff who negotiated the existing Compliance Assurance Agreement were told that it was
"politically infeasible" for DEQ to include any stronger language in the agreement and said that, while they
would work toward EPA objectives, they could not formally commit to them. The advent of Performance
Partnership Agreements has also created a context in which there is little guidance for how much leeway a State
has in conducting its unique compliance and enforcement program. Now that we have the rather complete
picture provided by the audit results, we are prepared to take the necessary actions to remedy the situation.
Recommendation 2-1
Require DEQ to develop and implement enforcement policies and procedures which are consistent with EPA's
Compliance and Enforcement Manual, Timely andAppropriate Enforcement Response to Significant Violators,
and Clean Air Act Stationary Source Civil Penalty Policy.
EPA Response
Concur, with comment. Early in FY99 we will begin negotiations with Idaho DEQ to substantially revise the
State-EPA Compliance Assurance Agreement. While we do not have the unilateral authority to require that
DEQ strictly and formally adhere to our compliance and enforcement policies and procedures, it will be a major
goal that this agreement reflects them as well as possible and, in any event, we will expect future State
performance and outcomes to reflect that. Should the State fail to secure results that are in line with EPA
expectations, we will take whatever actions are necessary — including carrying out independent inspections and
assuming responsibility for enforcement actions — to ensure that there is an adequate Air enforcement program
in Idaho.
Chapter 3 Findings and Recommendations
Recommendation 3-1
Assess the level of inspection resources available to DEQ and negotiate with DEQ to inspect major and
potential sources in accordance with EPA's Inspection Frequency guidance. In the event it is determined that
DEQ cannot meet EPA's guidance, the Region should assess DEQ's criteria for selecting sources for inspection,
including determining that the criteria do, in fact, result in the most high risk (for noncompliance) sources being
inspected annually.
EPA Response
Concur, with comment. During the fall of 1998 we will establish with the State the numbers of inspections to
be accomplished by DEQ during FY99. We are not sure whether the State has sufficient inspector resources
assigned for their inspection program to satisfy EPA's Inspection Frequency Guidance. We will, however,
assess the State's selection criteria and encourage them to better target high risk sources.
Recommendation 3-2
Supplement DEQ's inspection resources with Regional staff if DEQ is unable to meet EPA's Inspection
Frequency Guidance.

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EPA Response
Concur, with comment. We will work closely with the State during the next few months on inspection
targeting to ensure that the collective (i.e., Federal + State) set of inspection targets is optimized and will review
their inspection plan for FY99 with the guidance in mind. Our ability to supplement State efforts beyond the
amount we already do will be contingent on the need for such resources — and their availability — when we
make an assessment in FY99 of the State's follow through and success in achieving the goals of the guidance.
Recommendation 3-3
Ensure that DEQ implements adequate procedures to ensure timely finalization of inspection reports.
EPA Response
Concur, with comment. We will work with the State to establish such procedures during revision of the
Compliance Assurance Agreement in FY99.
Chapter 4 Findings and Recommendations
Recommendation 4-1
Ensure that DEQ performs its review of stack test and CEMS reports timely.
EPA Response
Concur, with comment. This is an important objective to work toward, and we will make it a priority as we
renegotiate the Compliance Assurance Agreement. We believe this situation will improve when DEQ applies
the additional resources it is reported to have received to address this backlog of tests and reports.
Chapter 5 Findings and Recommendations
Recommendation 5-1
Ensure that violations on the SV list meet EPA's SV definition.
EPA Response
Concur, with comment. We have made this a continuing issue in our monthly, detailed SV calls with the State.
As the audit demonstrates, discrepancies can creep in. This is a concern for us and we will give it renewed
attention in our monthly calls.
Recommendation 5-2
Ensure that staff from both DEQ and the Region are aware of, and consistently use., EPA's SV definition and
criteria for the SV Day 0, addressed, and resolved dates.
EPA Response
Concur, with comment. We believe most State and Regional staff are aware of these definitions and criteria,
but that the reality of implementing them is a continuing struggle. Part of this is the nature of compliance and
enforcement work, where there is often missing or incomplete information that can take some time to procure.

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Timelines are also sometimes difficult to meet because EPA staff must often negotiate with State staff to
persuade them to follow a particular course of action consistent with our requirements, policies, or guidance.
Also, there is the issue of inadequate resources to move along actions so that they are always within the
boundaries of EPA policy and guidance. However, both State and EPA staff can clearly improve their
performance, and we will make this a high priority in the future.
Recommendation 5-3
Ensure that SVs are deleted from the SV list for appropriate reasons.
EPA Response
Concur, with comment. Again, we have continually raised such issues in our monthly SV calls with State
staff. We will continue to monitor the situation and promptly address deviations which we discover.
Chapter 6 Findings and Recommendations
Recommendation 6-1
Revise the Compliance Assurance Agreement with DEQ to include EPA enforcement guidance as criteria for
assessment oflhe State's stationary air enforcement program.
EPA Response
Concur, with comment. As mentioned above, this goal will be the highest priority in our Compliance Assurance
Agreement renegotiations.
Recommendation 6-2
Conduct, at least annually, evaluations of the State's air enforcement program for SVs for consistency with EPA
guidance.
EPA Response
Concur, with comment. By the end of 1999 we will conduct a review and assessment of the State's air
enforcement program to determine its consistency with EPA guidance. We will also make a determination at
that time as to the feasibility of doing this annually.
Recommendation 6-3
Develop and implement a plan to ensure that EPA enforcement actions taken in response to SVs are consistent
with EPA enforcement guidance. Also, ensure that justifications for mitigated penalties meet EPA Penalty
Policy criteria and are adequately documented.
EPA Response
Concur, with comment. We believe that EPA failure to always ensure that enforcement actions taken in
response to SVs are consistent with our guidance is primarily a resource dependent problem. We generally
agree that SVs are violators which EPA believes are environmentally most important, but this is tempered by
the fact that we are trying to balance SV priorities among four States and are not able to give all SVs in a
particular state our highest attention. In any case, we will develop a plan during the coming year to figure out

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how best to achieve consistency with our enforcement guidance. In addition, EPA Air Program staff have had
discussions with our Office of Regional Counsel to reinforce the need for adequate documentation of the
justifications for any mitigated penalties.
Recommendation 6-4
Report the weaknesses in the State's stationary air enforcement program for SVs as a management control
deficiency in the next annual FMFIA assurance letter to the EPA Administrator.
EPA Response
Concur, with comment. We will report on any remaining State air enforcement program deficiencies in the
next annual FMFIA letter.
Recommendation 6-5
Withhold final approval of the State's Title V program until the State establishes policies and procedures for
enforcement which are consistent with EPA's enforcement guidance. Specifically, the Region should assess
Idaho's Title V program against the criteria for an approvable program under 40 CFR Part 70.
EPA Response
Concur, with comment. While it is unclear whether we can withhold approval of the State's Title V program
solely on the basis of the State not adhering to all of EPA's enforcement guidance, we will make such approval
contingent on negotiation of a revised Compliance Assurance Agreement which is satisfactory to EPA and
which is aligned with these compliance and enforcement objectives.
Recommendation 6-6
Assume responsibility for enforcement of the stationary source air enforcement program in the State for major
and synthetic minor sources if the State is unable to implement an enforcement program that is consistent with
EPA guidance and the Clean Air Act.
EPA Response
Concur, with comment. We recognize this as a legitimate approach if the State is unable or unwilling to
implement an enforcement program consistent with EPA objectives. Given that the State needs to remedy a
number of serious deficiencies (many of which have become institutionalized over a period of years), we expect
that it could be several months before such revisions are fully negotiated and become integrated into DEQ's
program implementation -and follow through. Thus, we will refrain from making a decision to assume
responsibility from the State until DEQ has had an adequate period in which to demonstrate whether it can
deliver acceptable performance.
Enclosures: Idaho Response
EPA letter to States, 2/18/98
EPA memo to HQ, 7/9/98
c: Wallace Cory, Administrator, IDEQ

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Anita Frankel, Director, Office of Air Quality
Gil Haselberger, Manager, Air Enforcement and Program Support, EPA RIO
STATE OF IDAHO
DIVISION OF
ENVIRONMENTAL QUALITY
1410 North Hilton, Boise, ID 83706-1255, (208) 373-0502 Philip E. Batt, Governor
August 31, 1998
Transmitted by facsimile transmission to (206) 553-4038 and via Certified Mail
CERTIFIED MATT, # P 102 113 968
RETURN RECEIPT REQUESTED
Charles Reisig
United States Environmental Protection Agency
Office of the Inspector General, Western Division
1200 Sixth Avenue
Seattle, Washington 98101-3123
Re: Response to OIG draft audit report.
Dear Mr. Resig:
The Idaho Division of Environmental Quality (DEQ) has completed its review of the Draft Report on Idaho's
Air Enforcement Prop-ram dated July 31, 1998. Unfortunately, the report continues to imply wrongdoing on the
part of DEQ in the execution of its duties. To the contrary, we steadfastly maintain that our programs have
performed according to established agreements and in a manner protective of public health and the environment
at all times. The data show, in fact, that all of Idaho's airsheds currently meet air quality health standards, the
sole exception being one which remains under USEP A jurisdiction. This overall improvement in air quality can
be attributed to the effectiveness of the permitting and enforcement programs operated by DEQ. Today, while in
the midst of an expanding economy and population, we are extremely proud of these results.
The report continues to inappropriately emphasize differences in DEQ's administration and implementation of
its program when compared to a preestablished set of national criteria that DEQ had never agreed to strictly
comply with. The specifics of this argument were previously addressed in our letter to you dated July 6. 1998.
While each individual criticism in the report could be soundly argued on its own merit, we have elected to
forsake doing so at this time. This approach would likely be unproductive, since the fundamental argument
centers on the need for DEQ to fully comply with national policy and guidance as opposed to the numerous
agreements we had entered into in good faith with USEP A. It remains our understanding that these agreements

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contain the standards for which DEQ should be held to when evaluated for any purpose. These agreements,
your office has maintained, were in effect invalid since they did not consistently prescribe the terms and
conditions brought forth in national policy. This in itself is hard for DEQ to fathom, since the very agreements
in question stem from national policy, and were prompted and openly negotiated with our federal counterparts
at USEPA. To be vilified in a national audit for largely complying with the terms of such agreements is a
considerable injustice. DEQ's trust in ongoing and future agreements will be significantly compromised if such
an injustice is allowed to occur. We assume this will not be the case.
The audit report, by-and-large, condemns DEQ's performance. Since performance must be evaluated on a
predetermined set of criteria, DEQ maintains to have performed remark-ably well when appropriately
evaluated. Strict adherence to national policy as opposed to the operating principles DEQ has agreed to operate
its programs under in no way points to poor performance or ineffectiveness in meeting our goals.
As our previous response had indicated, we will work with USEPA in the coming year in an open and
cooperative manner to resolve perceived deficiencies in our program. It is critical, however, that through this
process USEPA recognize the differences in state policies and.in the direction and manner our agency may
respond. Equally important, regardless of the outcome of any negotiations, will be recognition that any actions
we commit to take we do so with the mutual goal of protecting public health and the environment at any cost.
Due to the fundamental arguments previously raised in this correspondence, DEQ rejects outright the
conclusions and recommendations brought forth in the draft report. We seek a retraction of all portions of the
report critical of DEQ for anything other than what was understood by this agency to be legally binding and
approved operating guidance. Only in doing so can your office accurately represent the performance and
efficiencies of DEQ's programs. Release of the report in its present state will serve no purpose but to undermine
the good intentions and successes we have realized.
In closing, we welcome continuing discussions on the valid issues you have raised in your report. We remain
committed to working with our partners at USEPA to determine and resolve those matters which are of truly
great importance to the effective operation of our programs in meeting our common goals.
Sincerely,
David J. Pisarski
Chief
Compliance Assurance Bureau
Idaho Division of Environmental Quality
DJP/sd c:\..Adave\audit2.rsp
cc: W. Cory
0. Green
Gil Haselberger, (Via fax at: (206) 553-0110 or (206) 553-0404)
T. Trumbull
L. Kronberg

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A. Frankel, USEPA
COF

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