CHAPTER 8 FROM INSPECTION TO SETTLEMENT: UNDERSTANDING THE ENVIRONMENTAL PROTECTION AGENCY'S CLEAN AIR ACT ENFORCEMENT PROCESS

• Jurisdiction: United States

Air Quality Issues Affecting Oil, Gas, and Mining Development in the West
(Feb 2013)
CHAPTER 8
FROM INSPECTION TO SETTLEMENT: UNDERSTANDING THE ENVIRONMENTAL PROTECTION AGENCY'S CLEAN AIR ACT ENFORCEMENT PROCESS
Adam M. Kushner
Partner
Emily E. Kimball
Associate
Kathryn L. Lannon
Associate
Hogan Lovells US LLP
Washington, DC

ADAM M. KUSHNER is a partner in Hogan Lovell's environmental practice in Washington, D.C., with more than 28 years of experience in all aspects of environmental regulation and litigation. Drawing upon his years of experience at the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Justice, Adam counsels clients on each of the major environmental regulatory programs (air, water, waste, hazardous substances, pesticides and toxics). He also represents clients on a broad range of adversarial environmental enforcement matters, including major Federal civil judicial and administrative litigation under each of the major Federal environmental statutes. Adam has negotiated and resolved matters arising under the Clean Air Act, the Clean Water Act, the Oil Pollution Act of 1990, the Resource Conservation and Recovery Act, the Superfund statute, the Toxic Substances Control Act, and the Federal Insecticide Fungicide Rodenticide Act. He served as the EPA's Director of the Office of Civil Enforcement prior to joining Hogan Lovells. In this role, he led the national civil enforcement program for all aspects of the CAA, CWA, OPA, RCRA, SDWA, and other significant environmental statutes. Adam previously served as the Director of the EPA's Air Enforcement Division where he led the EPA's stationary and mobile source enforcement programs. Prior to that, Adam was a Senior Counsel and trial attorney for more than 10 years in the Department of Justice's Environmental Enforcement Section. Adam has received numerous awards for his work from the EPA and the DOJ. He frequently lectures on environmental issues, including enforcement of and compliance with environmental law. He was in private practice prior to his time in government.

I. Overview of EPA's Enforcement Initiatives and Goals

In 2010, the U. S. Environmental Protection Agency ("EPA" or "the Agency") published its Fiscal Year 2011-2015 Strategic Plan, which outlines the following five strategic goals for advancing the Agency's environmental and human-health mission outcomes: (1) taking action on climate change and improving air quality; (2) protecting America's waters; (3) cleaning up communities and advancing sustainable development; (4) ensuring the safety of chemicals and preventing pollution; and (5) enforcing environmental laws.¹ With respect to enforcement, Goal 5, EPA explained its intent to "ensure compliance with environmental requirements and, as warranted, [to] employ vigorous and targeted civil and criminal enforcement" to address the most serious water, air, and chemical hazards in the nation's communities.²

Specifically, by 2015, EPA plans to conduct 105,000 federal inspections and evaluations over the course of the five years covered by its strategic plan.³ It also intends to initiate 19,500 civil judicial and administrative enforcement cases and to conclude 19,000 civil judicial and administrative enforcement cases as a way to measure the Agency's ability to maintain an enforcement presence over the same five-year period.⁴ In terms of criminal cases, the Agency's goals are to increase the percentage of criminal cases with charges filed to forty-five percent and to maintain an eighty-five percent conviction rate for those defendants by 2015.⁵ The Agency also seeks to enhance strategic

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deterrence through criminal enforcement by increasing the percentage of criminal cases having the most significant health, environmental, and deterrence impact to fifty percent and to maintain seventy-five percent of criminal cases with an individual defendant.⁶

A. The Office of Enforcement and Compliance Assurance

Within EPA, the Office of Enforcement and Compliance Assurance ("OECA") is responsible for carrying out the Agency's enforcement and compliance initiatives. OECA is one of the Agency's headquarters program offices, located in Washington, DC. OECA works with EPA's regional offices and in partnership with state and tribal governments and other federal agencies to enforce U.S. environmental laws, including the Clean Air Act ("CAA"), which is the focus of this paper. This office is responsible for the design, development, and implementation of national enforcement programs with the assistance of the regional offices, states, and tribes. OECA addresses air pollution problems through the following CAA programs:

• Part 60 New Source Performance Standards ("NSPS")

• Part 61 National Emission Standards for Hazardous Air Pollutants ("NESHAP")

• Part 63 Maximum Achievable Control Technology ("MACT")

o Maximum Achievable Control Technology ("MACT') - major sources

o Generally Available Control Technology ("GACT") - area sources

• New Source Review/Prevention of Significant Deterioration ("NSR"/ "PSD")

• Enforcement of State plans developed and approved under Sections 110 and 111(d)

• Title V Operating Permits

• Part 82 Title VI Stratospheric Ozone Protection

• Section 112(r) Prevention of Accidental Releases

• Title II Emission Standards for Moving Sources

• Section 129 Solid Waste Combustion

B. National Enforcement Initiatives

Consistent with the program priorities and the strategic plan set by EPA, every three years OECA publishes a set of "National Enforcement Initiatives" which identifies the Agency's specific enforcement goals. As EPA explained in its Federal Register notice:

EPA selects these priority areas every three years in order to focus federal resources on the most important environmental problems where noncompliance is a significant contributing factor. Enforcement and compliance national priorities are selected

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according to three criteria: (1) environmental impact; (2) significant noncompliance; (3) appropriate federal role.⁷

These initiatives are selected by focusing on industry sectors or sources of pollution that EPA believes can best be addressed through its national enforcement team. These initiatives are explained in further detail in each fiscal year's OECA National Program Manager ("NPM") Guidance. In 2010, OECA added energy extraction sector compliance to its list of enforcement priorities included in the plan for fiscal years 2011-2013. The following six National Enforcement Initiatives are addressed in the FY2013 NPM Guidance:⁸

• Keeping raw sewage and contaminated stormwater discharges out of our nation's waters;

• Preventing animal waste from contaminating surface and ground water;

• Reducing widespread air pollution from the largest sources, especially the coal-fired utility, cement, glass and acid sectors;

• Cutting hazardous air pollutants that affect communities' health;

• Reducing pollution from mineral processing operations; and

• Assuring energy extraction activities comply with environmental laws.

To implement these national priorities, EPA develops a strategy to achieve specific goals. These strategies: (1) describe the environmental or noncompliance problem; (2) discuss the reasons why EPA chose to address the problem; (3) explain how the problem will be addressed; (4) and highlight the progress made by the initiatives.⁹ OECA forms implementation teams, consisting of EPA and regional staff and management, to direct work and monitor progress, and allocates resources as necessary, to achieve the goals and annual milestones set out in the strategies. Once the strategy goals are achieved, EPA transitions the priority work into its core enforcement programs. From there, an issue may still be addressed through routine compliance assistance, inspections, investigations, and enforcement actions, even if the problem is no longer a national

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priority. The initiatives related to CAA enforcement and energy extraction are explained in more detail below.

1. Reducing Air Pollution from the Largest Sources

The Non-attainment New Source Review ("NNSR") and Prevention of Significant Deterioration ("PSD") (collectively, "NSR") requirements of the CAA "require certain large industrial facilities to install state-of-the-art air pollution controls when they build new facilities or make 'significant modifications' to existing facilities."¹⁰ In order to reduce air pollution from large sources that have been shown to seriously affect human health and the environment, EPA intends to take action to eliminate or minimize emissions from coal-fired power plants, cement plants, glass plants, and acid plants by ensuring that none of these plants are under-controlled.¹¹ Based on past investigations, EPA believes that many of these facilities are not in compliance as they have failed to install pollution controls after modifications to existing facilities, causing them to emit harmful pollutants such as sulfur dioxide, nitrogen oxides, and particulate matter.¹² Despite the focus on these specific sources, it is important to note that EPA's NSR investigations are not limited to the sectors identified as national priority sectors.

2. Cutting Hazardous Air Pollutants

Leaks, flares, and excess emissions from refineries, chemical plants, and other industries emit hazardous air pollutants ("HAPs"), which are known or suspected to cause cancer, birth defects, and other health risks in addition to causing serious impacts on the environment.¹³ EPA has identified leaking equipment from petroleum refineries and chemical manufacturing facilities to be the largest source of HAP emissions.¹⁴ Accordingly, in an effort to reduce hazardous air pollutants which are affecting communities' health, EPA will target (1) leak detection and repair, (2)

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waste gas flares, and (3) excess emissions (including those associated with startup...