THE NEXT GENERATION OF ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ANDREW MICHAEL GAYDOSH
It has been 20 years since passage of any new major federal environmental legislation. Even the most avid environmentalist will admit that American air, water and land are all cleaner and safer than they were 20 years ago. The administration of most major federal environmental laws and programs has been delegated to the states. Most businesses have established programs to deal with their environmental impacts, interaction with environmental agencies and regulatory compliance requirements or problems.
Nevertheless, in the past 20 years the levels of federal Environmental Protection Agency (EPA) inspections, investigations, enforcement actions and litigation have remained steady. Indeed, in the last 7 years alone, the EPA has conducted over 80,000 inspections/evaluations, and initiated nearly 13,000 enforcement actions. In that same period EPA has assessed over 800 million dollars in penalties and estimates that the cost of compliance actions taken in response to its enforcement actions will be nearly 50 billion dollars. Clearly, environmental compliance requirements, the consequences of non-compliance and significant interactions with EPA continue to impact the private sector.
Part of this steady federal activity is attributable to the growth and increased stringency of environmental regulations, and complexity of remediation and corrective actions. Compliance requirements have also become more intricate and nuanced, and enforcement cases and litigation more complex and challenging. In addition, the overlap of local, state and federal programs and jurisdiction has increased. The environmental regulatory matrix of today not only involves many levels of government, but also numerous agencies, like agricultural and energy agencies, that traditionally had not been heavily involved in environmental compliance or enforcement.
Another significant factor contributing to a steady level of federal environmental enforcement activity is the creation of the Office of Enforcement and Compliance (OECA) within EPA. This Office is dedicated solely to compliance and enforcement and sets agency priorities and goals that apply to federal, state and local environmental agencies. In the last 15 years OECA has developed new national compliance and enforcement priorities and initiatives and implemented strategies to carry these out. These priorities and initiatives go well beyond traditional regulatory schemes and target specific sectors, businesses, geographic areas and activities. As a result the methods and focus of targeting inspections and investigations, along with the manner in which enforcement cases are initiated, prosecuted or settled has evolved.
The most recent (2016) OECA National Program Manager Guidance provides some insight into the changed status and future direction and focus of environmental compliance and enforcement programs. This national strategy applies to all programs and establishes ambitious compliance goals for all federal environmental statutes. It also directs the tools to be used to obtain the goals. It dictates the national compliance and enforcement priorities, initiatives, approaches and targets. Much of this is reflected in what the national guidance calls for as “investing in a new paradigm called Next Generation Compliance”. This new paradigm for 2016-2017 retains focus on sectors traditionally impacted by environmental requirements. It spells out how agencies will scrutinize and address coal utilities, refineries, cement and mineral processing facilities. In addition it specifies a new focus and strategy for non-traditional sectors such as municipalities, construction, agriculture, animal feeding operations and most recently the energy extraction industry.
While this directive lays out a focus for next generation compliance and enforcement throughout the country, it is only a framework for federal and state implementation. The guidance provides a mere glimpse of its applications, impacts and ramifications. For any business that is affected by environmental regulation or oversight, an in depth knowledge of communication strategies, compliance requirements and how to deal with issues is needed. This includes not only compliance evaluation capabilities, but also the intricacies and nuances of how to navigate problems and potential or initiated enforcement actions.
Developing and implimenting an effective strategy to deal with environmental agencies can be difficult and complex. Even more so, to a business dealing with oversight or an inspection, information request, investigation or enforcement action the processes can be arcane, opaque and confusing. Nevertheless, for any business dealing with the scrutiny of a violation or enforcement action the costs and impacts can be significant if not devastating. It is not enough to know a program, regulation or the overall enforcement process, it is necessary to understand how they are being used as a tool by the regulator and what outcomes they are seeking. What is needed is in depth practical knowledge of how agencies operate, why compliance evaluations are targeted and conducted, how compliance determinations are made, and how the enforcement system works. What is needed is someone who knows the strengths, weakness and limits of the system, who the players are, what drives them.
My professional history encompasses more than 35 years of private and public sector work in environmental science, policy, and law. I have in depth knowledge of all aspects of the major environmental laws and programs, particularly the air, water, waste, hazardous substances, pesticides, toxics and Superfund programs. More specifically, for 25 years I have been engaged in interactions involving federal and state environmental agencies and private parties, including oversight, compliance and enforcement matters.
While I have broad knowledge of environmental programs, my area of expertise is with the national EPA compliance and enforcement program. My work in this area has ranged from field level investigations and oversight to prosecutions of highly complex enforcement actions and litigation. As an attorney and supervisory attorney I managed hundreds of cases and prosecutions undertaken both administratively and in federal court. As a federal program manager I have intimate knowledge of the strategies and decision making processes that drive interactions, investigations and enforcement within state and federal governments. As a lawyer and senior executive I developed and implemented compliance and enforcement programs, and authored national policies and strategies. I have interacted with and advised the most senior levels of state and federal regulatory agencies. As an EPA senior executive I worked closely with all Regional and EPA HQ enforcement programs and managers and the U.S. Department of Justice (DOJ).
While I have worked as an attorney, supervisory attorney, manager and advisor at EPA and the Department of Energy (DOE), most recently I served as the Assistant Regional Administrator for the Office of Enforcement, Compliance and Environmental Justice in EPA’s Denver Office. In this position I was the senior manager of a division of over 100 inspectors, case officers and attorneys responsible for oversight and enforcement in a six state Region. This entailed being involved with hundreds of investigations, prosecutions, negotiations and settlements conducted at the state, regional and national levels. I have unique knowledge and perspective of the inner workings and dynamics of EPA, DOJ, and federal and state environmental, agriculture and energy agencies. For over 25 years I was involved in developing a broad range of investigatory and adversarial actions including criminal and civil administrative and judicial actions.
I have a deep knowledge of the development, implementation and management of national enforcement priorities and initiatives including those under the Clean Air Act, Clean Water Act, Resource Conservation Act, Superfund and Energy Extraction Initiatives. I have unique knowledge of the emerging focus on the oil and gas industry and the related enforcement and compliance issues affecting that sector. Having designed and implemented many of these strategies, I am very familiar with the strengths and weaknesses of these initiatives and the emerging case law that effects their prosecution and settlement. I understand the constraints and limitations of EPA, DOJ and other state and federal agencies
I have knowledge regarding the interworking of state and federal environmental agencies and the people who manage them. I understand how the EPA Offices of Air, Water, Waste and Pesticides and Toxics do (or often do not) interact with OECA. I have intimate knowledge of how EPA, DOJ, and the states undertake enforcement cases and their unique approaches to them. I can anticipate OECA’s expectations and level of involvement in Regional and state enforcement matters. I also understand and can advise on the interplay of federal, state and local oversight, compliance evaluation and enforcement actions.
Based on my knowledge and experience I can provide guidance and advice to corporate officers, corporate counsel and litigation specialists on how to approach, communicate and negotiate with environmental agencies. I can provide insight regarding oversight determinations, inspections, compliance evaluations, and enforcement actions. I have in depth experience and expertise regarding the agency perspective and approach, how they will make decisions and who will (or should) be involved. I can also evaluate and advise on whether a violation will be pursued as a criminal or civil action, and how enforcement actions will likely proceed. I know how agencies view strengths and weaknesses, the outcomes desired by them, how they will negotiate or litigate. In short I can advise on how to use the system and maximize positions and results in challenging and often adverse circumstances.