P.I 

l0tCMf?H-3L"3L 

,y 

Improving the Efficiency and Effectiveness of Compliance 

Monitoring and Enforcement of Environmental Policies 

United States: A National Review 

Oct fff5~ 

Prepared by 

Cheryl Wasserman 

U.S. Environmental Protection Agency 

on behalf of 

The Organization for Economic Co-operation and Development 

Environment Directorate 

******************************************************************* 

This paper is not an official report of the U.S. Environmental 

Protection Agency. Any opinions expressed herein are solely 

the views of the author. 
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_ i 

INDEX 

ACKNOWLEDGEMENTS 

INTRODUCTION 

I. NATIONAL CHARACTERISTICS 

II. ENVIRONMENTAL POLICIES AND PROGRAM CHARACTERISTICS 

III. COMPLIANCE MONITORING 

IV. COMPLIANCE INCENTIVES AND ENFORCEMENT PROCEDURES 

V. INSTITUTIONAL CONTEXT 

VI. EVALUATION: THE EFFICIENCY AND EFFECTIVENESS OF CURRENT 

ENFORCEMENT AND COMPLIANCE PROCEDURES 

VII. CONCLUDING OVERVIEW: ENFORCEMENT AND COMPLIANCE SYSTEMS 

IN THE UNITED STATES 

APPENDICES 

CHAPTER II Appendix: Summary of the Major Environmental 

Statutes and Definition of Key 

Program Terminology 

CHAPTER III Appendix: Summary of Compliance Monitoring 

Requirements and Practices 

I 
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ACKNOWLEDGEMENTS 

The author gratefully acknowledges the contributions to this 

paper of numerous individuals both within and outside the U.S. 

Environmental Protection Agency with whom the author has worked 

closely. First, the author wishes to express her appreciation 

to the members of the Compliance and Enforcement Strategies Task 

Force and those associated with this recent effort who directly 

and indirectly made significant contributions to this paper. 

The Task Force was chaired by Glenn Unterberger, then Director 

of the Office of Legal Enforcement Policy. * The individual media 

program strategies developed by the Task Force provided valuable 

information on compliance monitoring and enforcement approaches 

and evaluations of past and future strategies for achieving 

improved levels of compliance. The Task Force also developed 

the U.S. EPA's "Working Principles" for compliance and enforcement 

activities. Both the program strategies and working principles 

formed the basis for a summary document "EPA's Strategy Framework 

for Compliance and Enforcement" prepared by Donna Fletcher of 

the Office of Policy, Planning and Evaluation. Many sections of 

Chapters IV and VI of this report borrow heavily from these 

documents. 

Second, the author recognizes the ground-breaking work 

performed by the Steering Committee on the State/Federal Enforcement 

Relationship whose product, the "Policy Framework for State/Federal 

Enforcement Agreements" substantially altered over a three month 

period the direction of the U.S. enforcement program. 

Third, the author wishes to acknowledge the valuable insights 

into actual program operations and problems gained from two 

major projects of EPA's Program Evaluation Division. The Source 

Monitoring Study, managed by Jean Caufield evaluated EPA's 

requirements for self-monitoring and reporting of compliance 

by regulated sources, in the air, water and hazardous waste 

programs. The Air Continuous Compliance Study managed by Jim 

vickery, assessed the ability of the national air program to 

monitor and enforce air emission standards on a continuing basis. 

Special appreciation also goes to the National Enforcement 

Investigations Center in Denver for their contributions to the 

Appendices for Chapters II and III, through the concise summaries 

of inspection practices and statutory programs contained in 

their "Multi-Media Inspection Guide." 
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INTRODUCTION 

This paper was' prepared at the request of the Organization 

for Economic Cooperation and Development (OECD). It provides an 

overview of how the compliance monitoring and enforcement aspects 

of the United States' environmental programs actually work in 

practice. Chapter I summarizes key national characteristics 

that shape the U.S. procedures for setting and enforcing environmental standards. Chapter II summarizes the specific mechanisms 

and procedures by which environmental policy and programs are 

translated into enforceable requirements. 

Chapter III reviews how compliance with environmental 

requirements is monitored with particular emphasis on how and 

why decisions have been made among various program design options. 

Chapter IV describes the incentives and enforcement procedures 

used to achieve high rates of compliance with environmental laws 

and regulations. Chapter V describes the institutional setting 

within which the design and implementation of U.S. compliance and 

enforcement programs are carried but. 

Chapters VI and VII provide both an evaluation and summary 

overview of the U.S. programs and how successful they have been. 

The U.S.* environmental programs are diverse and complex. 

Each program has adopted somewhat different approaches to monitor 

and achieve compliance. In this regard they provide a laboratory 

for evaluating different approaches. Nevertheless, they share 

many similarities in approaches which are fundamental to the 

values and governmental systems found within the United States. 

This paper will address both these similarities and differences 

among U.S. programs where they occur. 

In introducing this paper, it is important to distinguish 

two concepts now used in the United States environmental program: 

"compliance" and "enforcement." "Compliance" is almost a state 

of being. When a regulated source is in compliance, it is 

achieving required environmental standards or regulations. The 

term "enforcement" is usually applied to those agency actions 

specifically intended to convey legal sanction and/or penalty. 

The U.S. Environmental Protection Agency's "enforcement programs" 

traditionally have encompassed only compliance monitoring and 

formal or informal enforcement responses. The broad range of 

both coercive and noncoercive techniques used to effectively 

change or deter source behavior are now being tied together into 

comprehensive compliance strategies for each of the major environmental programs and their components. High levels of real and 

continuing compliance are the goal of our programs. Enforcement 

is viewed as one of several tools to achieve it. 
_H£ 

There is great importance attached to the distinction between 

the two terms: compliance and enforcement. Many differeflt kinds' 

of public and private incentives and disincentives may be usedto help attain and maintain a healthy and beautiful natural 

environment; the coercive power of the U.S. and State or local 

governments is important, but is only one such incentive. Changing 

the behavior of a pollution source also means changing its employees' 

will and ability to comply in some respect.. Force of law can do 

much to change onels actions, but it cannot necessarily give one 

the capacity to behave differently. To focus exclusively on the 

legal and procedural uses of coercive power is to miss the many 

other incentives and practices by which government helps build 

capacity to meet popular, new social goals. Over the past fifteen 

years of environmental activism, U.S. agency officials have begun 

to think in terms of both compliance and enforcement so as to 

make the best use of the powerful and costly apparatus of civil 

or criminal prosecution. At the same time, improved management 

systems are being developed to ensure more consistent and timely 

application and escalation of formal enforcement sanctions to 

provide the necessary sense of will, purpose and incentive to 

gain broad compliance with environmental requirements. 
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I. NATIONAL CHARACTERISTICS 

Government environmental programs—like most other regulatory 

programs—exist to reinforce, change or deter behavior. In introducing 

the programs used to establish and enforce United States' environmental 

policies, it is -important to keep in mind the social values and 

national characteristics that shape them. A look at some of these 

social values that compete for primacy in the U.S., along with the 

institutions for balancing and implementing changing values, will 

set the stage for the more detailed discussion of our compliance 

and enforcement programs. 

A. Social and Political Values 

Government programs in the U.S. succeed so long as they enjoy 

public confidence. Confidence in government agencies in turn 

correlates closely with the ability of officials to operate in 

concert with current social and political values. 

1. Environmental Values 

Perhaps the most important influence on U.S. environmental 

programs is the significant public support of and concern for the 

environment and public health. Public support for environmental 

protection has indisputably risen from obscurity to top rank in 

the years since the publication of Rachel Carson's book Silent 

Spring in the mid 1950's. 

The dominance of environmental values shows up in many ways. 

For example, the enactment of one piece of major environmental 

legislation after another at the national level during the 1970's; 

the proliferation and growth of environmental interest groups; as 

well as the creation and popularity of formal technical training 

and professional careers in environmental specialties. Table 1-1 

demonstrates just how strong and persistent values have been for 

both the natural environment as well as public health. As the 

natural resources of the U.S. become more limited, and as our 

understanding of the ecological links between environmental quality 

and human health grow, so have the concerns of the public over the 

introduction of pollutants and toxic waste into the environment. 

2. Economic Well-Being 

Values im economic vitality and efficiency continue to be 

strongly felt in American life. The cost of controlling pollution 

can be sizeable in absolute terms, although not as a percentage of 

Gross National Product, especially in the early stages of control 

equipment installation or hazardous site cleanup. Similarly, the 

associated indirect costs of uncertainty, litigation and delay 

attributed to new environmental regulations also have proven to 

be great. Although competing economic values recently have slowed 

the rate of new regulation and have led to certain procedural 

reforms, Table 1-1 indicates that Americans value environmental 
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quality even at high economic costs as measured by dollars or jjbs < 

lost. One might expect economic well-being to be valued asr. highly 

as environmental values, but this is not the case, at least not . 

yet the case in the U.S. 

Table i-l 

VALUJSS IN ENVIRONMENTAL OUALITY 

1978 "Costs added by regulations are worth it to protect the 

environment." 

Yes 42% 

No 19% 

(Opinion Research Corporation) 

1981 "Given the costs involved in cleaning up the environment, 

do you think Congress should make the Clean Water Act 

stricter?" 

Yes 52% 

NO 44% 

(Louis Harris and Associates/Business Week) 

1982 "Environmental standards can't be too high." 

Yes 42% 

No 58% 

(Resources for the Future) 

1983 "Given the costs involved in cleaning up the environment, 

do you think Congress should make the Clean Water Act 

stricter?" 

Yes 62% 

No 35% 

(Louis Harris and Associates/Business Week) 

3. Distrust of Large Institutions 

Americans tend to distrust large institutions. This usually 

results in the use of checks and balances to ensure that these 

large institutions reflect more of the confidence placed in small 

over large, th* individual over the group, and local over national 

solutions. Table 1-2 shows that this value has persisted in American 

life for decades. For this reason, the standard-setting and compliance 

activities o£T regulatory agencies in the U.S. are characterized by 

open procedures, freely available information, and seemingly endless 

opportunities for public comment and appeal to other authorities. 

They also attempt to effect a balance through the Federalist structure 

of the U.S. governmental system with shared responsibility between 

the Federal and State and local governments, and through the court 

system to monitor legislative and executive functions. 
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TABLE 1-2 

REGULATION AND MISTRUST OF BIG BUSINESS 

1936-37: Percentage Favoring Greater Federal Regulation of Business 

Unskilled workers 55% 

Skilled workers 51% 

Managerial workers 33% 

Source: Combined 1936-37 AIPO (Gallup) surveys, quoted 

in Fortune 

1975: "The way business is behaving, we need the government to 

keep an eye on them." 

Agree 61% 

Disagree 28% 

Source: Cambridge Survey Research in Public Opinion. 

June 1979 

1978: "Government has to play an increasingly active role in 

regulating business and industry because of the increasing 

size of corporations and the complexity of the U.S. economic 

system." 

Agree 59% 

Disagree 33% 

No Opinion 8% 

Source: Opinion Research Corporation 

4. Privacy and Individual Property Rights 

Still another key value in the design and implementation of 

compliance programs is the concern for personal privacy and private 

property rights. These values are fundamental and are established 

explicitly in both national and state constitutions. The sanctity 

of private property and the right of each person to be free from 

unwarranted government intrusions into his or her affairs are 

values that color virtually every agency decision to monitor, 

inspect, or enforce for compliance at a given site. 

5. Confidence in Science and Technology 

Finally^rulemaking and compliance programs in the U.S. also 

reflect a strong bias that public support for protecting the public 

health and environment be met by an equally strong showing that we 

"know" something well enough to act upon it. That places great 

emphasis on natural and social science. Science is a respected 

and necessary part of overall rulemaking, as well as a part of 

certain individual compliance and enforcement decisions. One 

cannot succeed for long in the world of environmental regulation 

without a working knowledge of health effects, engineering technology, 

measurement techniques and statistics, and economic cost and benefit 

calculations. The American public puts its confidence in an agency 
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official who can justify his or her actions on grounds of natural. 

or social science. Effective compliance programs in thTe

Tn.s. are 

those with solid scientific and technical support. 

B. Balancing Competing Values 

It is within this context of strongly held and sometimes 

competing values that Americans make environmentally sensitive 

decisions. A businessman allocating available investment capital 

among competing projects in the firm decides what type of pollution 

control to finance. An agency official determines the appropriate 

level of pollution control. A judge determines whether to grant 

private contractors rights to inspect a pollution source. In each 

of the key decisions affecting the environment competing values 

are reconciled one way or another, implicitly or explicitly. 

1. Advocacy and Adversarial Systems 

The most common American approach to reconciling competing 

values is an adversarial one. Americans tend to have an advocate 

for each value.and let the advocates argue for primacy in some 

controlled institutional setting. The environmental agencies often 

3erve as the appropriate settings for fair and open adversarial 

process, to act independently in balancing competing values in a 

given case to the extent permitted by statutory authorities. The 

U.S. judicial system remains as a final arbiter in most agency 

decisions, ensuring that agency decisions reflect the intent of the 

legislative body in setting and enforcing standards and effectively 

balancing these various factors in reaching its decisions. 

U.S. environmental statutes are among the most detailed and 

specific of American laws. They create complex, multi-tiered 

programs and mandate that a wide variety of standards be set and 

enforced within specific statutory deadlines. They also set forth 

certain requirements and constraints for balancing competing values. 

As the product of years of political debate and compromise, these 

laws ought to be a reasonably clear set of marching instructions 

for society to approach environmental goals. But for all their 

detail, American environmental laws leave a great many weighty 

decisions to be made ~ as well as implemented — by the unelected, 

specialized staffs of national, state, and local regulatory agencies. 

This amounts, to a grant of enormous discretionary authority to the 

environmental regulatory agencies to balance values. 

There are very practical, expedient, and understandable reasons 

for legislators to at once delegate so much authority to the regulators 

and hold them to the most challenging directives. First, there is 

just not enough time in a legislator's day to specify all the 

details needed to define and protect against environmental harm. 

Second, few if any legislators have the technical training to set 

standards or evaluate control options. More importantly, politicians 

often prefer not to make clear-cut decisions resolving fundamental 
P.10 

conflicts among values. Instead, their statutes give agency 

administrators long lists of "technical considerations",, to be made 

in any agency decision to act, without a lot of instruction as to 

the weight each consideration should carry. As a result, environmenta 

agency officials in the U.S. find themselves embroiled in powerful 

political controversies in case after case, both in standard-setting 

and in implementation — the very controversies that the politicians 

should perhaps have resolved in the statutes. 

With so many program decisions subject to active political 

controversy, many environmental regulations and practices have 

been challenged in court by one interest or another, in the hope 

that judicial review would finally and "correctly" resolve the 

matter. Moreover, special provisions in environmental statutes 

give ordinary citizens the right to sue either to force agency 

action whenever the agency has allegedly failed to act as required 

by law or who fails to reconcile the concerns of all affected parties 

before taking an official regulatory action. So in many respects 

the statutes declare a kind of judicial "open season" on an agency 

chief. 

Provisions for such judicial review can be an effective mechanism 

to ensure that agency action never contravenes the letter or the 

intent of environmental law. They and the other characteristics 

of environmental law exposing agency decisionmaking to controversy 

and judicial review have made the implementation of environmental 

policy in the U.S. a slower, more protracted process than envisioned 

by the statutes. Yet they also ensure that any changes or developments 

in environmental regulation will reflect the mix of American values 

well enough to maintain public confidence in government environmental 

programs. 

2. Consensual Processes 

There is a large social cost associated with reliance on 

confrontation and litigation to achieve balanced environmental 

progress. While the predominant posture and process for making 

and implementing environmental policy remains an adversarial one, 

government agencies actively pursue more consensual approaches to 

rulemaking and compliance. During the rulemaking process, within 

formal rules to ensure fairness, there is an extensive exchange of 

information and views with ample provision for informal and formal 

public cooMsant. Experiments in "regulatory negotiation," involving 

all interested parties in a process seeking compromise and concensus, 

are in progress to further reduce the incidence of litigation arising 

from standard setting. Negotiations have always played and continue 

to play a major part in compliance and enforcement activities. 

3. Analytic Techniques for Balancing Competing Values 

There is progress as well in developing quieter, new alternative 

mechanisms for striking better environmental-economic balances 

during the rulemaking process. By Presidential order, agencies 

must now perform economic cost-benefit or cost-effectiveness analyses 
P.11 

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of proposed new rules before those rules can take effect. In 

order to implement this order, agency analysts have beenrlooking . 

much more closely at the size and variety of economic impacts that 

proposed rules might have. This requirement may eventually have 

the effect of eliminating many later appeals for variances or 

contested penalty hearings where the alledgod root of the problem 

is a disproportionately high economic cost to comply. 

There are other longstanding mechanisms for striking case-specific 

balances between economics and compliance. In several programs a 

regulated party can petition for a variance from a particular 

requirement. Although infrequently used, some of these variance 

provisions permit relaxation of a standard where economic or other 

factors must prevail, but most provisions merely allow alternative 

technical approaches or time extensions. Finally, at the implementation or compliance phase of a regulatory program, virtually 

every environmental statute contains some provision by which the 

Agency can use a specially-tailored compliance schedule imposed 

in conjunction with an enforcement action, either administrative 

or judicial. In their practical application, compliance schedules 

preserve the prosecutable characteristic of the original violation 

while granting the noncomplying source more time to manage the 

technology and financing required to comply. 

4. Federalism 

Perhaps the most important implementation mechanism in the 

U.S. for balancing competing values without sacrificing environmental 

progress is the federal intergovernmental system. In environmental 

programs that system is a somewhat cumbersome and redundant allocation 

of authority among the national, state, and local governments to 

set standards, monitor compliance, prosecute violations, and oversee 

each other's activities. Since the "right" tradeoff between or 

among competing values can differ from locality to locality, it is 

helpful for each level of government to have a measure of flexibility 

to deal comfortably with its own circumstances. Sometimes a state 

or local government that is denied flexibility by federally-imposed 

uniform standards recovers or tries to recover some flexibility 

through locally-tailored monitoring, variance, or enforcement 

policies. Continuing oversight of State and local programs is 

therefore essential to maintain consistency and fairness in the . 

implementation of national environmental laws. 
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II. ENVIRONMENTAL POLICY AND PROGRAM CHARACTERISTICS 

r 

r 

National characteristics discussed in the preceding chapter 

are an important backdrop to understanding: 1) the specific grants 

of statutory authority by Congress to the agencies, 2) the conduct 

of and choices made during the rulemaking process, and 3) the 

particular regulatory or policy approach adopted by a given agency 

program. In this chapter these three predeterminants of compliance 

success are introduced with specific reference to che major programs 

and subprograms. 

A. General Federal Regulatory Approach 

The U.S. federal government administers or oversees seven 

major pieces of environmental legislation through the U.S. Environmental 

Protection Agency (SPA): 

° Clean Air Act (CAA) 

4 Clean Water Act (CWA) 

4 Safe Drinking Water Act (SDWA) 

° Resource Conservation and Recovery Act (RCRA) 

4 Toxic Substances Control Act (TSCA) 

4 Federal Insecticide, Fungicide and Rodenticide Act (FIFRA) 

4 Comprehensive Emergency Response, Compensation and ~'4-

Liability Act (CERCLA). 

the basic approach in most of the U.S. programs is to establish 

both national standards for acceptable ambient concentrations of 

pollutants, and/or for sources of environmental pollution through 

specific requirements for the testing, registration, handling, 

emission, discharge, or disposal of harmful substances. Regulatory 

programs imposing national standards for sources of pollution are 

supplemented by any additional requirements necessary to achieve 

and maintain ambient levels. Regulated sources are then expected 

to comply with both national standards pertaining to specific 

sources and requirements needed to achieve ambient levels whether 

the programs are implemented directly by the EPA or delegated to 

the States. In most cases, the national standards are applied to 

sources through permits which are tailored to individual facilities 

and their environmental circumstances. Meeting the federal standards 

usually is a precondition for receiving the permit with some 

including schedules for meeting federal and/or state standards. 

The EPS establishes the federal standards and requirements 

for permit issuance for an approvable State program. Most permit 

programs ara then administered through these approved State programs. 

There are, however, exceptions. For example, the TSCA program is 

run entirely by the federal government whereas Subtitle D of RCRA 

(governing the disposal of nonhazardous solid waste) and the 

FIFRA program are run almost entirely by the States. A breakdown 

of Federal and State responsibility is described in more detail in 

Chapter V, on institutional aspects of the program. 
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The States may set more stringent standards than t^hose required 

by federal law. State regulation of air and water pollution is 

often more inclusive than federal regulations require. For example, 

California has more stringent air pollution controls on both stationary 

and mobile sources, and Texas' conditions on hazardous waste handling 

and disposal are more stringent than federal standards. California 

also has chosen not to exempt small-quantity generators of hazardous 

waste. 

A description of each of these statutory programs may be found 

in an Appendix to this Chapter. It also defines key acronyms for 

the programs and subprograms which are used later in this report. 

B. Rulemaking Characteristics 

Choices made during the rulemaking process can have an enormous 

effect on the ultimate level of compliance and enforceability of a 

regulation. Experience across the variety of environmental programs 

at the national and state levels has led Congress and U.S. regulators 

to adopt several different practices during rulemaking in order to 

assure that implementation and enforcement can follow smoothly from 

the issuance of a new regulation. 

1. Impact Analysis: Independent Analysis and Public Comment 

Perhaps the most important rulemaking characteristic is the 

degree to which the rulemakers study the capability of the potential 

regulated community to comply with a proposed rule. In the U.S. 

the most common method for such study is to analyze impacts before 

proposing a rule and then to solicit and review public comments at 

the time a rule is first proposed. Advance notice of proposed new 

rules is now commonly given in well-indexed, low-cost government 

periodicals, so that any person or organization can quickly scan for 

proposals affecting its interests. Written comments from the public 

are generally accepted for 30 to 90 days after the notice is given, 

and agency staff prepare detailed summaries of and responses to such 

comments. Often the comments received bear directly on the difficulty 

or unanticipated effects of compliance, and provide the agency with 

an opportunity to rethink its approach. Where the agency staff 

choose to disagree with or override the concerns expressed in public 

comments, they do so in responses which are published shortly after 

the initial comment period. While the responses may not include 

a change in*regulatory approach, they do help the regulated community 

understand awl prepare for the future regulation. 

The impact analyses commonly include an economic impact analysis, 

in which agency engineers and economists look in some depth at the 

costs and, in fewer instances, benefits of compliance with a proposed 

rule. This analysis provides an independent check on the public 

comments received, and may serve to underscore concerns that the 

rule might prove difficult for industry or local agencies to implement. 
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Similarly, analyses of information collection burdens that would be 

imposed under the proposal can provide clues to otherwise hidden 

implementation problems. 

2. Open and Lengthy Process for Resolving Disputes 

Often in U.S. environmental rulemaking an agency promulgates a 

rule only to have the regulated community, environmental groups, or 

both challenge the rulemaking in court, and litigate the rule all 

the way to the U.S. Supreme Court. As a result, staff try to draft 

more comprehensive and tightly written rules, and attempt to solicit 

early and effective comment. The courtroom litigation ultimately 

establishes the accepted facts and final determinations of law. But 

such an adversarial approach also fosters — from the very beginning 

of a new program — a counterproductive attitude among all affected 

interest groups. It focuses too narrowly on preserving the legal 

options at the expense of building incentives for compliance, and it 

leaves confusion if a rule is still being challenged at the time the 

agency moves to enforce to ensure compliance. 

New and more consensual approaches being tried in the U.S. 

were referred to in Chapter I. Among these are the use of regulatory 

negotiations, in which all major interests in a particular rule are 

identified in advance and invited to participate in informal negotiations over the shape and applicability of a new rule. Such negotiations, can be helpful in sorting out future problems early, and 

in eliminating resistance by one group or another. However, existing 

agency rulemaking processes already provide for comment by outside 

groups. Experience has shown that even consensual approaches can 

leave dissatisfaction within the regulated community when the agency 

posture shifts from consulting and working with industry in devising 

a rule, to actual enforcement of those rules. Consensus approaches 

can help improve compliance, but they are no guarantee of success. 

3. Use of Accepted Industry Practices 

There are two helpful rulemaking practices in the U.S. that 

clearly improve the climate for compliance. First, the agency tries 

to use generally recognized measurement and analytic methods to 

demonstrate that a given rule will in fact produce measurable 

environmental improvement. Such use of science eliminates an easy 

argument against a new rule, and helps win the respect of the agency's 

scientific and technical counterparts in industry. Second, the 

agency produces preliminary technical data showing options for 

feasible technologies for meeting proposed new standards. By doing 

so, the agency not only helps convince its corporate counterparts 

that it is making a reasonable technological demand on them, it also 

invites firms that supply control (or monitoring) technology to begin 

to commercialize the technology in time for use when the proposed 

rule takes effect. These scientific activities help build a willingness 

and capacity to comply in the technical community. There are, however, 

instances in which protocols must be developed simultaneously with 

the standard, and in which the Congressional directive is "technology 

forcing," that is, it requires levels of pollution control or moni tonne 
P.15 

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which are beyond those established by the "state of the art." in. 

these instances, compliance often takes longer to achieve* and the 

program can be delayed by technical controversy. 

4. Coordination Across Media and Across Federal Programs 

It is possible for new standards in one program area to interfere 

with successful compliance in another program. Recently, U.S. 

electronics firms remedied chemical solvent leaks from tanks into 

ground water by releasing them in part into the air, thereby aggravating a local ambient air quality problem. There are several 

rulemaking practices in the U.S. that help avoid such unintended 

multi-media effects. First, most national statutes require the 

program administrator to look affirmatively for other environmental 

effects. EPA is currently experimenting with an "Integrated 

Environmental Management Program" to help its policymaking staff 

do this more effectively. Second, the agency issues a "Start Action 

Request" for each new rulemaking effort, and circulates that request 

to each different program office for review. A work group is formed 

from representatives of each of the program offices that can identify 

a potential impact in its jurisdiction. Third, a key-industry impact 

analysis is performed to study the industries most affected by the 

rule to see if just such intermedia effects might appear. 

Intermedia coordination is also accomplished across federal 

agencies, including those with non-environmental missions. It is the 

responsibility of the Office of Management and Budget (OMB) to flag 

proposed environmental regulations having potential conflicts in 

other regulatory areas. For example, the Office of Surface Mining 

recently formed a work group with three different environmental 

program offices to develop surface mining regulations. The overall 

success of such interagency checks is fairly good. 

A third and final test for intermedia coordination is performed 

by the federal EPA regional offices. Regional office staff sit on 

each rulemaking work group at headquarters, and take on the role 

of representing their own views as well as being able to better 

reflect state agencies' interests and practices. 

5. Stringency Versus Enforceability of Standards 

The future success of compliance monitoring and enforcement 

depends not only on the involvement by regulators of the regulated 

community, and the use of standard techniques and protocols, 

but also upon the stringency of the requirements they set. More 

stringent: rules in theory mean larger and possibly quicker 

advances in environmental cleanup. The stringency of a standard 

is usually viewed by decision-makers as a question of time and cost: 

the tougher the standard, the more expensive- it will be for sources 

to meet it — especially if it can be met only by widespread use of 

technology still under development. U.S. environmental laws encourage 

setting tough standards on the theory that stringency would help 

force improvements in the technology available to measure and control 

pollution. Wherever such technology is already feasible, it should, 

in theory, only be a question of time before sources can budget for 
P.16 

II-5 

it, order equipment, take delivery, and install controls. Less 

stringent standards are seen as one path to getting quick compliance 

and public approval, but not necessarily a large quantum, "of environmental improvement. 

But stringency has not been clearly examined by U.S. rulemakers 

for its effects on enforceability and ultimate compliance levels. 

Too tight a standard imposed too early in the life of a program can 

generate both .disrespect for the rule among the engineers and 

plant managers who must make compliance decisions, and reluctance 

to enforce among the regulators. There are several examples of this 

in the U.S. programs where such programs have been challenged in 

court and delayed. Once such delays occur, the agency is placed in 

the position of having to take strong, formal legal enforcement 

measures to preserve the integrity of its programs and to breathe 

life back into them once the technology is perfected. The agency 

rarely can simply backtrack and relax the standard, because that too 

would undermine its credibility. Setting ambitious ar.d impractical 

standards in the first place makes the task of enforcement more 

difficult, and the remedies for violations more limited. 

In examining the availability of technology to achieve specific 

levels of pollution control, the agency has very rarely examined 

the tradeoffs between level of control and reliability of equipment 

over time. This analysis once was completed in the standard-setting 

process for Clean Air Act new source performance standards for electric 

utilities, but it is not common practice. Often questions of enforceability are general, or tied to compliance monitoring requirements. 

As the agency focuses more on continuous compliance, and monitoring 

techniques improve, the issue of equipment reliability will become 

more important. Indeed the Agency is beginning to address issues of 

uncertainty within the context of risk management and this may also 

help to raise issues of equipment or process reliability over time. 

A recent development in U.S. standard-setting is the use of 

triggered stringency or a phased approach based upon likely risk. 

In this approach, implemented in the hazardous waste permit program, 

moderate or minimum federal technical standards are set for a source 

along with self-monitoring requirements — in this instance, ground-wate 

monitoring. Should self-reporting, citizen complaints, or inspections 

indicate a violation or related environmental hazard, the source 

must thereafter comply with stricter standards. The triggered standards 

usually require more intensive monitoring, but they can require 

additional control measures as well. In this way an agency can 

attempt ova* time to place the costs of control on those sources 

where problems are most serious or frequent, rather than across the 

board. 

6. De Minimis Levels and Segmenting the Regulated Community 

Tiered regulations are widely used in U.S. environmental 

programs. Separate output rate standards have been promulgated 

for each of dozens of categories of air and water pollution. Many 

rules include exemptions for sources whose size or pollution outputs 

fall below so-called "cutoff" levels. Since federal law allows states 
P.17 

II-6 

to adopt standards more stringent than most national requirements, 

there is a small amount of state-by-state tiering of stringency a'bove 

a uniform national floor. 

C. Regulatory Approaches and Policy Tools Employed 

The portfolio of regulatory approaches employed in environmental 

programs is large, including regulatory standards or permit requiremen 

of several types discussed here, along with monitoring and reporting 

requirements that are discussed at length in Chapter III. Testing, 

registration, and certification are also tools used, although less 

widely. Nonregulatory policy tools such as grants, research subsidies 

and training programs, make up a large portion of the overall EPA 

activity. These other policy tools can have important uses in improvir 

compliance in the regulatory programs. Finally, political pressures 

to reform regulation are forcing agency staff to look at an even 

wider array of regulatory approaches to bring about results at lower 

cost and with less intrusion by government. 

The selection of a regulatory or hybrid policy tool from this 

portfolio is an important determinant of the ease and success of 

subsequent compliance monitoring and enforcement. Table II-l shows 

the types of standards predominating in each program area. Table 

II-2 highlights the more significant of approaches to create new 

flexibility in environmental programs, including the ways variances 

add a measure of flexibility to U.S. environmental programs. ~ 

1. Permits Versus Rules of General Application 

Requirements are set forth by agencies through rules of general 

application requiring all sources to meet the same requirement, 

and/or in the issuance of individual permits, each containing some 

standardized as well as customized conditions to be met by the regulatec 

source. Each option has advantages and drawbacks for compliance 

monitoring and enforcement. 

A general rule can be more amenable to compliance monitoring 

depending on how it is drafted. All things being equal, since 

only one requirement applies to all sources, self-monitoring programs 

as well as inspections can require less training and preparation; 

only one regime must be learned. It is easier to explain the rule 

to the community in the initial stages of the program, and it is 

easier for suppliers of monitoring and control equipment to define 

and meet thai market needs created by the rule. Even the legal enforcement staff have an easier time in that they heed to learn definitions, 

interpretations, and evidentiary matters for one kind of violation. 

But the advantages for the agency do not necessarily mean that 

the incidence of compliance is bound to be higher under general rules. 

The burden of complying with a general rule usually falls more heavily 

on some sources than others and/or requirements may need to be 

interpreted as to how they apply to an individual facility. Inequitable 

effects or unclear requirements can lead to greater disregard for 

the "unfair" law, a correspondingly lower willingness to comply, and 

a greater number of petitions for a variance. This is largely 
P.18 

Pragraa 

Air - Gwtn l 

Stationary 

Nobllt 

Water - general 

Dlacharga 

PREDOMINANT 

Approach 

Standards 

Rules 

Par«its 

Rule* 

Standards 

Peraits 

TlM« n-i 

REGULATOPy 

exAitpi.es 

I 

APPROACH | 

i 

• 

r

 T . 

Predominant Standard 

Ambient 

Maaa or Output Rate 

Mass or Output Rata 

Ambient 

Maaa or Taehnology 

Drinking water 

Undarground 

Injaetion 

Ratardoua Waste 

Rulaa 

Peralta/Rulea 

Rulaa (interim) 

Paraita (final) 

Output Rata Practices 

Ambient Concentration 

Taehnology 

Taehnology, Ambient 

Practices 

Toxic Substance* 

(PCBa) 

Pesticides 

- Producers 

- Applicatora 

Rulaa 

Pa raits 

Registration 

(Permit) 

Certification 

Table II-2 

Informational 

Practices 

Informational, 

Ambient Reaidue (ppm) 

Practices 

Practices 

PROVISIONS TOR PLBXIBILITY 

Program 

EXAMPLES 

Approaches Variances Oranted For 

Air - Stationary 

Air - Mobil* 

Water Dischargers 

Drinking water 

Underground Injection 

Hazardous Maste 

Toxic Substances 

Bubble Policy 

Emissions Trading 

Noncompliance Pees 

Pleat Averaging 

Xntraplant Bubble 

Wasteload Trading 

Seasonal Permits 

Negotiated 

Testing 

Agreements 

Output Rate Infeasibility 

Denonatrated equivalence 

Innovative Technology 

Fundamentally Different 

Paetors 

Demonstrated Absence of 

Thermal Effects 

POTW Dlacharga into Deep 

Ocean Currents 

Intake Water Conditions 

and application of 

treatment 

Mo Underground Drinking 

Water Source in Vicinity 

Demonstrated Lack of 

Statistically Significant Change in 

Amoient 

Pesticides 
P.19 

II-8 

the situation found in U.S. air quality programs for stationary s,ourct 

under State Implementation Plans. So many variances from generally 

applicable State emission standards have been issued for existing 

air pollution sources that many argue that it would have been easier 

to start with individually negotiated permit conditions. Certainly 

most of the state and local air quality agencies themselves employ 

operating permits as the basis for their programs, even though 

it may not be required under the federal statute. 

Prom the standpoint of an enforcement official, individual 

permits present a more difficult challenge. Inspectors need to 

understand a wider variety of acceptable approaches and possible 

violations; indeed, they need to read and understand each source's 

permit before planning and conducting an inspection. The collection 

of evidence differs from case to case as does the kind of presentation 

to be made before a judge. Therefore the cost of enforcing tends to 

be higher, and the probability of making an error in the prosecution 

goes up with each departure from the tried-and-true requirement in a 

general rule. 

Yet when viewed from a compliance perspective—especially the 

source's perspective—the customized permit conditions can well 

comprise a goal that the source is either more willing or better able 

to meet. Agency goals and source capacity are accommodated in setting 

the conditions in the permit, often in a kind of consensual, localscale negotiation. The agency can therefore expect that the probabili 

of compliance by that permittee is higher—even though the quality 

of inspection and successful enforcement might be lower in the event 

of a violation. Therein lies the benefit in asking first what it 

takes to achieve compliance, before designing and implementing a 

program that maximizes only enforceability. 

2. Types of Standards 

The kind of standard written into a rule or permit also has 

important effects on the success of monitoring and enforcement 

activities. The following types of standards are often called "command 

and-control" standards since they tend to prescribe very specifically 

what a regulated source must do. 

Ambient, standards are attractive in that they most closely 

represent the social goal of environmental protection, namely, the 

reduction in the concentration of harmful substances in the ambient 

environment* Indeed, ambient standards are usually written in units 

of concentration (e.g. units of mass per unit volume) or units of 

relative concentration (parts per million). But ambient levels are 

seldom used as enforceable standards. Instead, ambient levels are 

used for stating areawide goals, and for planning what individualsource contributions can be accommodated individually and in the 

aggregate in a given environment without exceeding the standard. 

Quite frequently ambient standards are set not as requirements but 

as triggers for special requirements such as more intensive monitoring 

or control at individual sources. 
P.20 

l 

II-9 

Mass rate (output) standards are the most technically informative 

characterizations of a particular facility's pollution discharges, 

and are the standards most widely used in writing regulations, 

permits, and monitoring requirements. Output rate standards are 

generally expressed as units per unit time passing a given physical 

mark known as a compliance surface. They are unfortunately only 

loosely correlatable with ambient environmental effects by means of 

complex mathematical "diffusion models." Negotiations over an appropriate output standard for a source are often complicated by differing 

opinions over just how much an adverse ambient contribution a given 

source's output rate will have. Moreover, output-rate measurements 

require sampling and continuous output monitoring instruments that 

have, in some media programs, been expensive and difficult to keep in 

calibration. 

Mass emission or effluent rate standards are often referred to 

as performance, as opposed to technology, standards. They allow 

sources to adopt the least costly means of achieving a specified 

environmental result. They have also been the most amenable to 

further economic reforms. The so-called "bubble policy" in the air 

program allows a source with multiple stacks at one facility to vary 

its emissions from the output standard for each stack, so long as 

the aggregate emissions from the facility do not increase. The 

bubble policy appears to have the greatest application among sources 

of volatile organic compounds (VOC) for which the relationship between 

emission rates and ambient levels is most direct. Since 1977 a 

stationary source of air pollution has been free under federal law 

to overcontrol its emissions, and sell or transfer to a nearby plant 

a "credit" for the unused allowable emissions. la some states, a 

similar transfer of water pollution allowances has been successfully 

implemented. 

Water permitting programs have from their inception treated 

a single plant outfall pipe in much the same way, ignoring the 

characteristics of the several waste streams until they ultimately 

flow together into a single regulated outfall. Similarly, the 

mobile-source program in air allows motor-vehicle manufacturers 

to average the pollution emissions of different models in the fleet, 

so long as the weighted average of models, sold stays within the 

single vehicle output rate standard for the nation. 

These reforms can often make enforcement more difficult if the 

revised requirements cannot be easily traced and understood by an 

inspector. The more creative the regulatory process, the more 

difficult it will be to track compliance. In theory, however, the 

more cost-effective the control requirements, the more incentive 

there is for "voluntary compliance." 

Technology standards are often an implicit basis for standardsetting and enforcement. Most statutes require EPA to set performance 

standards based upon the best available control technology. Examining 

the technology, therefore, can be an effective substitute for output 

standards, especially when the design or brand of control equipment 

has been well known and tested for performance under the range of 

input and ambient conditions generally experienced by sources in the 

community. In the early days of a regulatory program, when 
P.21 

11-10 

little is known about output rate monitors and it is important-to 

get initial installation of control equipment, the use of "technology 

standards" is particularly tempting. Moreover, inspect46.n for 

compliance with technology standards is quite simple and inexpensive? 

one merely looks around to see if an approved type of equipment is 

in place and switched on. 

The drawbacks of technology standards are that: 1) they tend 

to freeze technological innovation in the control equipment industry, 

and 2) the mere installation of equipment offers little assurance 

over time that it will continue to operate correctly. The importance 

of getting some kind of control in place at major air and water 

pollution sources has been so great over the past decade in the U.S. 

that permitting, standard-setting, and compliance monitoring programs 

alike have usually begun as technology-based efforts. As a result, 

even when requirements are performance-based, the permit specifies 

how an individual source will comply and the program often shifts 

its focus to the promised technology. 

Practice standards are either recommendations or prohibitions 

of certain ordinarily minor activities and methods practiced by 

source employees. Standards are written because such practices can 

have significant environmental impacts, usually when taken together 

over a period of time. Examples include prohibitions on sloppy 

gasoline hose connections and carrying hazardous liquids in uncovered 

buckets, or agricultural practices to minimize non-point water runoff. 

Like technology standards, practices are easy to inspect and cite 

for violations, but compliance is difficult to judge on an ongoing 

basis. U.S. courts have refused to enforce practice standards unless 

the legislature has specifically authorized the agency to write such 

standards. Since the focus on management practices appears more 

intrusive of internal business management decisions than the focus 

on environmental result, emission or effluent rates, courts want to 

be sure that the legislature intended the agency to wield its authority 

for such cause. 

Informational Rules are distinct from the so-called "commandand-control" standards above in that they require a source of 

potential pollution to develop and submit information evaluating the 

potential for environmental harm from its releases. (The author is 

excluding compliance monitoring from this category.) These rules are 

employed aa the major regulatory tool when either: 

1) ta# releases are themselves not waste but valuable products 

such as new chemicals or pesticides, or 

2) tha releases are a newly-identified part of a waste 

stream that is already subject to costly controls, and 

additional controls cannot be justified without better 

information. 

The first is the case under TSCA and FIFRA, while the second condition 

is appearing more frequently as agencies come to grips with the 

relatively small amount of toxic substances accompanying the regulated 

discharge of more conventional or better-known pollutants. 
P.22 

11-1 1 I 

Once reported and evaluated, new chemicals and pesticides are 

usually certified for general use or release. The object of any 

subsequent agency inspection or monitoring program is the quality and 

accuracy of the manufacturer's testing and analysis procedures and 

records. Some substances are approved only for limited uses, or with 

certain labeling requirements imposed as a condition of certification. 

In these cases, misuse or mislabeling can be cited as a violation much 

as if the registration or certification document were a permit to 

release the chemical for use in commerce, and the use or label were a 

practice standard as discussed above. The value in this approach is j 

that the potential for disclosure of environmental hazards often j 

forces manufacturers to self-police and keep the most hazardous 

substances from ever reaching the marketplace. 

Variances 

Most environmental statutes in the U.S. include previsions under 

which a regulated source may petition the agency to grant it an 

exemption from a rule of general application. This formal grant is 

called a "variance" and its terms and conditions have much the same 

effect as the conditions of a permit. Variances can be obtained 

before source operations begin, although many are requested after a 

violation has been noted or cited by an inspector. There are usually 

several preconditions for granting a variance. Federal rules ^prohibit 

state or local variances from resulting in violation of federal law. 

Variances are most frequently requested from technology standards 

and air pollution emission rate standards. Like the widespread use 

of varied and individual permit conditions, variances increase the 

requirements for training and preparing inspectors, and decrease the 

probability that the agency can successfully enforce against violators. 

Circumstances warranting a variance typically include the 

availability of an innovative or equivalent control technology, a 

showing that one's facility is fundamentally different from the 

facility assumptions used in setting a standard, a showing that 

peculiar physical circumstances (such as naturally contaminated 

intake water) make compliance technology inoperative, or a demonstratior 

that an alternative approach creates no statistically significant 

change in the environment. 

7. Non-Regulatory Tools 

Environmental programs in the U.S. primarily are designed to set 

regulatory standards, and ensure compliance with those standards, 

through legal sanction, penalties and force of law. However, statutes 

give EPA and its state government counterparts other tools for improvinc 

compliance. Technical assistance programs also are available, to a 

limited extent, particularly to aid small businesses that cannot 

afford to pay environmental consulting firms to advise them on 

their compliance problems. 

Virtually all EPA scientific and technical documents—including 

guidebooks on inspection techniques and enforcement policies--are 

available for public purchase. Government research and development 
P.23 

11-12 

grants programs can direct funds toward the development of treatment 

facilities as has been the case for municipal sewage treatment plants 

and for subsidizing ongoing program implementation, including 

inspections and enforcement. Technical assistance is also available 

to local governments on a routine basis and for one-time surveys or 

mass inspection which they cannot afford to carryout themselves. 

One of the most effective means of assisting state or local government 

is for EPA to assign staff on federal salary to work in the State or 

local offices for a defined period of time. 
P.24 

III. COMPLIANCE MONITORING. 

The terra "compliance monitoring" — as used in this chapter— 

encompasses all those activities undertaken by the regulated community 

or government, officials to collect and assess information on the 

compliance status of regulated sources of environmental pollution. 

In the U.S. environmental programs, compliance monitoring provides: 

0 information for sources of pollution themselves to take 

essential preventative and corrective action to maintain 

compliance? 

• reliable and timely detection of violations at an individual 

pollution source; 

° evidence necessary to support enforcement actions for 

identified violations; and 

0 reliable compliance statistics for use in planning programs, 

setting priorities and evaluating progress. 

There are four sources of compliance information: 1) source 

self-monitoring and reporting, 2) inspections by government officials 

or independent third parties, 3) citizen complaints, and 4) ambient 

monitoring. The mix of information sources employed varies from one 

environmental program to another, but source self-monitoring and 

inspections are by far the most important means of compliance monitorir 

A. Source Self-Monitoring 

A fundamental principle of U.S. environmental policy is that 

regulated parties should keep track of their own compliance status 

using required methods, as well as any other means they deem reasonable 

to provide themselves with reliable compliance data. Requirements 

for source self-monitoring and reporting are generally based on the 

assumption that the discipline of collecting, recording, and reporting 

compliance data to a responsible government agency will result in a 

higher level of management attention to achieving and maintaining 

compliance. 

Source self-monitoring and reporting are also used to supplement 

government inspections, both in uncovering relevant data and in 

guiding tha-allocation of limited inspection resources. Inspections 

are costlyr so more frequent source self-monitoring and recordkeeping 

can provide a more complete picture of compliance behavior than a onetime visit could provide. 

Self-monitoring reports also provide government officials with a 

basis for screening sources and selecting targets for inspection. 

Source self-monitoring usually does not eliminate the need for an 

official inspection prior to formal enforcement proceedings. There 

are some exceptions in which formal enforcement actions are taken 
P.25 

solely on the basis of self-reported data. A key factor in whether 

a program relies solely on source reported data to officially define 

source compliance is the adequacy and quality of the source'selfmonitoring date:, But inspections generally are performed in addition 

to source self-monitoring to corroborate the accuracy of the reported 

data. 

Requirements for methods, instrumentation, frequency of data 

collection, the .recordkeeping and reporting are all subject.to close 

public and private scrutiny. The need for collection and reporting 

of compliance data is always balanced by concerns over the cost and 

paperwork burden. This balance is reflected in new national policies 

for more cost-effective regulation and reduction in paperwork burden 

on state and local government officials and industry alike. 

Recently two distinct points of view have clashed over reporting 

requirements. One scnool maintains that the requirement to report 

all compliance data is beneficial in and of itself in promoting 

higher rates of compliance — simply because it is backed by the 

threat of government review and action, including criminal prosecution 

for fraud in the event of reporting violations. The other school 

believes that data reports should not be required where government 

cannot possibly review and act on all the data. This school argues 

that if government cannot act on all self-reported violations, then 

the value of self-reporting is diminished. There is also the concern 

that if the government demands all the information that regulatees 

generate on their compliance status, it creates a disincentive for 

the regulatees to do more monitoring than is minimally required. 

In an effort to accommodate both schools, a number of reformers have 

suggested the use of "exceptions reporting" -- that is, reporting 

only violations rather than all compliance data. The debate continues 

as to whether the integrity of a routine reporting system is worth 

the cost of reporting more data than officials can in fact use. 

Most of the environmental statutes ensure that self-reported 

data is available to the public. The U.S. government and most States 

have laws and regulations granting any citizen the right to examine 

or copy such agency information. There are limited exceptions 

preventing government from disclosing certain kinds of confidential 

business data that have been duly labeled and submitted in confidence 

by a regulated source, but these exceptions are never available for 

technical information describing the physical nature and environmental 

impact of a violation. As a practical matter, confidentiality provisions are rarely at issue except in the pesticide (FIFRA) and toxics 

(TSCA) prograpa* where companies routinely submit product formulation, 

production, and distribution data — and where the agency routinely 

protects that? company confidence. 

The requirements for self-monitoring, recordkeeping and reporting 

in the various U.S. environmental programs are summarized in the 

following tables and text. 

1. Water Pollution 

Of all the environmental programs in the United States, the 

naticnal water program relies most heavily on source self-monitoring 
P.26 

" lli- J " 

and reporting. There are currently over 60,000 permittees nationwide,. 

and about 6,000 are defined as "major sources" based upon criteria 

related to environmental impact. All permits for dischargesTinto 

surface waters of the United States contain requirements for selfmonitoring and reporting. The program regulations set forth a general 

requirement for monitoring, the use of a standard national Discharge 

Monitoring Report form for both federal and state-approved programs, 

a minimum reporting frequency of once per year and a three-year 

recordkeeping requirement. Most major sources must report en a monthly 

or quarterly basis. Minor sources generally report annually or semiannually, state governments usually require more frequent reporting. 

Table III-a-1 summarizes the universe of minimum federal requirements 

that usually apply to water pollution sources. However, the specific 

parameters, methods, and frequency of monitoring and reporting are 

usually tailored to individual sources at the time of permit issuance 

and set forth in the permit. In recent years EPA has developed 

statistical profiles for specific industries which have enabled EPA 

to reduce the cost and frequency of monitoring requirements. 

The table summarizes rules for direct dischargers; indirect 

dischargers (those, using publicly owned treatment works, POTWs) face 

similar requirements and the additional duty to notifying the POTW 

when effluent characteristics are changing or coming in a "slug" 

pattern. New requirements to pretreat such indirect waste include 

mandatory monitoring of toxic pollutants. 

Methods and Pollutants - Federal regulation (40 CFR 136) specifies 

at least one analytical technique (and usually more) that must be 

used to determine the level of a given pollutant in a given sample. 

Analytical techniques for more than 100 different pollutants have 

been specified. Organic toxic pollutants are to be monitored by 

means of a gas chromatograph mass spectrometer (GC/MS). A few effluent characteristics are amenable to continuous monitoring; most 

are measured in samples taken with various frequencies, where a 

source's effluent characteristics are unchanging and/or it is a 

smaller source, the permit will specify sampling frequencies as low 

as once per quarter. Typical testing costs for any one parameter 

per sample run from $50 to S2000. Biomonitoring has only recently 

been required, and only where the source is a large, complex facility 

discharging toxic substances. As permits begin to address toxic 

limits, biomonitoring techniques are likely to be more frequently 

used to monitor such operations on a continuing basis. GC/MS is 

generally viewed as too costly to use on a continuing basis. 

2. Drinking Water Safety 

Approximately 60,000 community water systems supply drinking 

water to more than 90% of the U.S. population. Each of these systems 

is required to test its water for the presence, of six types of 

contaminants for which national primary standards--maximum contaminant 

levels (MCL)—have been set. The results of such sampling must be 

reported to the government at frequencies which vary with the size of 

the water system and the contaminant of interest. These sampling/ 

reporting frequencies range from daily to every three years, four for 

radionuclides. Once reported, the results become public information. 
P.27 

III-4 

Indeed, where a test shows that an MCL has been exceeded, that 

violation and its consequences must be reported by the system to ' 

its customers. In the event that the violation creates an imminent 

health hazard, the water system must report the violation through 

the local media. 

Methods and Pollutants - Federal regulation (40 CFP 141) 

specifies the sampling frequencies and analytical methods to be 

used in monitoring for contaminants. For quality assurance, all 

systems must employ government-certified laboratories to perform 

their monitoring, although the systems remain responsible for 

reporting the results to the government. The cost for sampling and 

analyzing for any one contaminant ranges from $2 to about $500. 

Although 52 states and territories now administer the drinking 

water program on their own, the monitoring and reporting requirements 

are similar from one locality to another. 

Table III-a-2 summarizes the self-monitoring requirements of 

the drinking water program. 

3. Underground Injection Control (UIC) 

To protect underground drinking water supplies from contaminants 

injected into nearby wells primarily by waste disposers and certain 

oil drillers, the drinking water program regulates such underground 

injection practices. The UIC regulations cover 5 classes of wells. 

Class I wells are those that are used to dispose of wastes below all 

fresh water aquifers and are commonly referred to as deep disposal 

wells. Class II wells are injection wells associated with production 

of oil and gas primarily enhanced oil recovery well and brine disposal 

wells. Class III wells are those used to inject fluids for the insite mining of minerals. Class IV wells are wells used for shallow 

injection of hazardous or radioactive wastes and are banned. Class V 

wells are all other wells. The regulations for Class I, II and III 

wells include some general monitoring and reporting requirements. 

More specific requirements are imposed on a case by case basis in 

permits. Class V wells are authorized to operate as long as this 

operation does not endanger underground sources of drinking water. 

Table III-a-3 summarizes the self-monitoring and reporting 

requirementa for underground sources of drinking water protection 

program. 

4. Air Pollution 

Stationary Sources - There are approximately 29,000 major 

stationary sources of air pollution regulated in SIPs, an additional 

2,100 new sources regulated by new source standards (NSPS), and 

another 1,300 stationary sources emitting hazardous air pollutants 

for which hazardous air emissions standards (NESHAPs) have been 

promulgated. The cost of control technology for these sources to 

date exceeds the compliance cost for any other environmental program. 

Yet the requirements for source self-monitoring and reporting have 

been limited in comparison to such requirements in water programs. 
P.28 

III-5 

Stack emissions tests are generally required only when control 

equipment is first installed, and then a government inspector is usuall 

present to witness the unusual event. Stack tests also have been 

little used because their cost per test can run from $3,000 at best 

to $50,000 more commonly, and even as high as $200,000. Continuous 

emission monitoring (CEM) equipment has until recently been expensive 

and unreliable, due to the hot corrosive environment of most stacks. 

As a result, only about 1500 of the newer sources have been required 

to install CEMs. Other techniques have not been required of sources. 

Visual opacity readings usually relied upon by inspectors, though 

cheap and well-accepted, give only a crude indication of the particulat 

emission rate from a stack. There is an interesting new opacity 

monitoring technique employing laser-beam radar (lidar) technology 

that now offers more accurate and reliable data but it is expensive 

and available only through the National Enforcement Investigations 

Center in Denver. 

In the absence of cost-effective monitoring technology, air 

program officials have imposed minimal routine and frequent selfmonitoring requirements, and limited reporting requirements as 

well. Although.the technology and regulatory requirements are both 

changing with the times, the U.S. air program is still characterized 

by relatively little emissions testing, either by the source or by 

government officials. A renewed commitment to focus on continuous 

compliance may soon lead to a substantial increase in the numbers of 

sources required to install, operate and report based upon continuous 

emission monitors. 

Mobile Sources - The aggregate emissions from the engines of 

some 150 million motor vehicles make up a significant portion of the 

air contamination in the U.S. Self-monitoring and reporting requirements are imposed today primarily on those institutions that can 

easily affect the emissions of many vehicles at once: the vehicle 

manufacturers, the vehicle maintenance shops, and the fuel suppliers. 

Pollutants - Stationary source rules control the emissions of 

particulates (TSP), S02, NOx, VOC, CO, and lead. Hazardous pollutants 

currently regulated include asbestos, vinyl chloride, beryllium, benzene 

and mercury. Vinyl chloride sources must routinely report levels of 

VC measured by batch samples and GC monitors. Still other pollutants 

are regulated under Section 111(d) to the extent they are emitted 

simultaneoualy with the listed pollutants by a given source (for 

example, B20rfrom kraft paper mills). 

The sane pollutants are emitted by vehicles, but mobile-source 

programs ara primarily concerned with lead, VOC, NOx, and CO. 

Table III-a-4 summarizes the self-monitoring and reporting 

requirements in the two major air programs. 

5. Hazardous Waste 

Waste analysis, ground-water monitoring, and self-analysis of 

hazardous waste manifest records are at the heart of the "cradle-tograve" approach to hazardous waste handling in the U.S. Like the water 
P.29 

rrr-6 

programs, the hazardous waste programs face tens of thousands of , 

different waste handlers many of which have complex or variable waste 

constituents. The sheer variation of the regulated community makes 

self-monitoring, analysis, and reporting all the more important, 

since it is the individual waste handler that is in the best position 

to question and identify the many wastes characterizing its facility 

on a given day. If the waste-manifest tracking system is to succeed 

as the nation's primary hazard management system, then the information 

collected and entered on the manifest by generators, transporters, 

and TSD facilities must be complete and accurate. 

Methods and Pollutants - Waste constituents that exhibit ignitibility, corrosivity, reactivity, and toxicity make the waste hazardous 

for purposes of environmental regulation. A list of such wastes and 

their identifying numbers can be found in 40 CFR 261, along with 

recommended analytic methods. 

Ground-water monitoring requirements differ from site to site, 

but typically include testing for the MCLs listed under the drinking 

water program regulations, analyses for the presence of certain 

principal hazardous constituents (PHC) listed in the hazardous waste 

regulations, and annual GC/MS scans to test for unexpected additional 

hazardous constituents. 

Table III-a-5 summarizes the self-monitoring and reporting 

requirements for generators, transporters, and TSD facilities. 

6. Toxic Substances 

Most environmental releases of toxic substances are regulated by 

agency programs in the foregoing areas. However, there is a separate 

program at the federal level devoted to identifying, listing, and 

assessing chemicals in commercial use and proposed new chemicals for 

their hazard potential. Under TSCA, this program can control the 

production and use of known or suspected hazardous chemicals nationwide 

It has done so for only a few such chemicals, although it now has 

data on thousands of substances. The self-monitoring and reporting 

rules under TSCA are summarized in Table III-a-6. 

7. Pesticides 

Since the pesticides program is primarily a premarketing testing 

and registration program, there are few self-monitoring or reporting 

requirementa besides an annual summary of production and sale of 

general and restricted-use pesticides. However, there are important 

recordkeeping requirements to give agency inspectors an opportunity 

to check on labeling and advertising practices that might not comport 

with restrictions on use. Health-effects test records must also be 

maintained to help trace any harmful effects of pesticides in use 

back to the manufacturer. There are about 11,000 registered pesticide 

producers and dealers and more than 2,000,000 certified apnlicators. 

Table III-a-7 summarizes the monitoring and reporting rules under 

FIFRA. 
P.30 

B. Inspections 

T 

v 

Despite widespread self-monitoring, inspections remain the 

backbone of agency compliance monitoring programs. As the seven 

tables in the Appendix attest, inspections are the government's 

main tool for officially assessing compliance, and for assuring 

quality and lending credibility to self-monitoring programs. 

The independent evaluation provided by a government inspection 

is the key. 

If all sources of environmental risks and pollution were 

perfectly willing and able to comply with environmental 

regulations, then the government requirements for self-monitoring 

and reporting would alone be sufficient to identify problems and 

ensure speedy compliance by source operators. Of course, 

environmental values are not the only ones at work in the operating 

decisions made by source managers. In reality, it is necessary 

for government to enforce the primacy of environmental values 

over economic or organizational values wherever the source manager 

makes key decisions affecting the environment. In order to do 

that, the government or third-party must at some point pay specific 

attention to the information available on the particular source. 

That examination into the environmental affairs of a single 

regulated source is called the "inspection." 

1. Characteristics of Inspections 

The objectives of any inspection are to discover and, evaluate 

source performance and compliance thereby improving' both the 

ability and the will of a source to comply with an applicable 

regulation. Some inspections are called inspections "for cause" 

in that thev are made in response to specific information that 

something is amiss at a particular facility. Other inspections 

are called "routine" and are scheduled as part of an agency's 

ongoing compliance program. In both kinds, the inspector seeks 

to: 1) identify specific environmental problems, 2) inform the 

source and the agency as to the existence of the problems, 3) 

collect and preserve evidence of non-compliance, and/or 4) "show 

the flag" by creating a credible presence of the interest and 

power of government in front of particular managers at a particular 

site. It ia probably safe to say that every inspection will 

serve all four objectives, although the design of an inspection 

should reflact the relative importance of each objective in that 

instance. Zn general, U.S. environmental programs design their 

inspectiona with specific features in mind: the focus and level 

(or complexity), frequency, cost, and likely compliance result. 

Levels of Inspections - The focus of any one inspection is 

commonly one or more of the following: the existence of an up-todate permit or registration certificate, the installation of 

equipment necessary to monitor or control pollution, specific 

management plans and practices, the preparation and maintenance 

of records, the correct operation of such equipment, and the 

conduct of sampling and analysis of pollution streams. These are 
P.31 

III-8 

listed roughly in order of increasing cost to inspect. _UT.s. 

programs create different types of inspections by combining one 

or more of these objectives. 

Regardless of the level, most inspections are conducted with 

careful attention to: 1) the manner of entry onto the source 

premises, 2) an opening conference to explain the inspection 

process to the source, 3) the focus of the inspection itself, 4) 

the closing conference, and 5) the preparation of an inspection 

report and file. 

Rights of Entry/Announcing Inspections - Entry for an inspection 

can be either announced or unannounced to the source. Legal and 

practical benefits and constraints enter into the choice between 

approaches.. All U.S. environmental program statutes grant rights 

of entry, but FIFRA and SDWA require written notification before 

entry. Most U.S. inspections, and virtually all complex sampling 

inspections, are announced. The notification usually comes by 

telephone call followed by a notification letter detailing the 

kinds of information that should be available to the inspector 

before or during the visit. Announced inspections reduce the 

chance that the time will be wasted due to missing records or 

absence of knowledgeable personnel. They also help reduce time 

taken to discuss which inspection data deserve to be treated as 

confidential business information. 

Some U.S. inspectors try unannounced inspections routinely 

and others only when citizen complaints or employee tips give an 

inspector good reascn to suspect that a source is in violation, 

and is likely to contest any such determination based on inspection 

data. Similarly, where there is reason to believe that data or 

other evidence would be destroyed prior to an announced inspection, 

the surprise visit is preferred, even though the inspection is 

bound to be stressful and less efficient. The U.S. air program 

is conducting an evaluation of the costs and potential benefits 

of unannounced inspections given the difficulty of obtaining a 

good picture of continuing source performance through existing 

methods. 

A further complication in the use of unannounced inspections, 

and inspections generally is that, under the U.S. constitution, 

persons hava a right to be free of unwarranted searches and 

seizures —•literally the right to turn away an enforcement 

agent at tfta door, unless the agent already obtained a search 

warrant. K recent U.S. Supreme Court decision limits the ability 

of an inspector to demand entry whether announced or unannounced 

— even when the agency's statutory authority grants a right of 

entry. Rather than risk running afoul of that constitutional 

provision, agency inspectors now prepare to go back quickly to a 

judge to obtain a search warrant in the event that a source 

refuses requested entry. As long as the inspector does indeed 

have probable cause to search for violations or is not arbitrarily 

singling out the source, a judge is likely to issue the warrant 

and eliminate the constitutional barrier to the visit. 
P.32 

Frequency of Inspection - The frequency of inspection at a 

given site is determined by cost and the expected compliance 

benefit. For example, where a source is recalcitrant, there are 

frequent inspections. Another determinant of frequency is the 

expected time before equipment failure (or management vigilance 

failure) next occurs. Given the real consideration of costs, it 

becomes necessary to trade off frequency and the type (or comprehensiveness) of inspection. In the U.S., routine inspections 

are scheduled primarily at intervals of 1, 2, 3 or 5 years- — 

the annual time periods being explained perhaps by the annual 

need to demonstrate program performance in order to justify next 

year's inspection budget. Table III-I summarizes the inspection 

frequency recommended for major sources in each of the major 

U.S. environmental program areas. 

Access to Inspection Data - In the U.S., the data collected 

in the inspection report and files become public information just 

as self-monitoring reports do. As such, the data can be requested 

by other citizens, and the agency must release it except where 

confidential business information has been identified by the 

source. 

2. Ensuring Qualified Inspectors and Laboratory Practices 

Environmental regulations in the U.S. are both sufficiently 

technical and novel that good inspection requires well-trained 

professionals. 

Good inspection requires good technical professional 

inspectors. It is not always possible to find enough specialists 

to serve as government agency employees—particularly in the 

early years of a new program or regulation. Salary limitations 

also make it difficult for government to recruit and keep good 

inspectors. This has proven to be particularly troublesome in 

the new requirements for ground-water monitoring expertise under 

the RCRA and UIC programs. Therefore most agencies rely to some 

extent on technical contractors to supplement or substitute for 

government inspection teams. Although the immediate expense to 

the agency is higher, the long term cost is lower and the professional 

level immediately available for work is higher. However, some 

recent court decisions have narrowly construed the statutes that 

grant rights of entry to non-government officials, and may thereby 

limit entry by contract inspectors unless specifically authorized 

by statute. RCRA, the hazardous waste program, does provide 

such explicit authorization; the clean air and clean water statutes 

do not. 

Increasing attention is being paid to ensuring the quality 

of laboratory analysis supporting the inspection and monitoring 

programs. The pesticide program relies upon a formal laboratory 

certification and the Superfund program also has an extensive 

program for auditing the laboratories used to analyze hazardous 

waste samples. 
P.33 

111-10 

Table II1-1 

EXPECTED INSPECTION FREQUENCIES 

AIR 

Major Sources 

Minor Sources 

WATER 

Major Sources 

Drinking Water 

Underground Injection 

RCRA 

Major TSD 

Others 

TSCA 

Test Labs 

FIFRA 

General Use Establishments 

Restricted Use Establishments 

Test Laboratories 

Annual 

Biennial 

Annual 

Annual-Surface Water 

3 Years-Ground Water 

N/A 

Annual 

4 years 

3 Years 

5 Years 

3 Years 

2 to 5 Years 
P.34 

III-ll 

3. Targeting and Allocating Inspection Resources " r 

Since every environmental program has limited staff and 

dollar resources, agency managers must allocate inspection 

resources wisely. A wide variety of routine and special inspections, 

frequencies, Inspection levels, and objectives can be mixed in 

endless combinations without exceeding a given budget. But only 

a few of those combinations can bring maximum improvements in 

compliance for the given budget. Perhaps the biggest single 

development in U.S. programs over the past five years has been the 

emergence of the concept of tiered levels or types of inspections— 

each with its own cost-benefit and cost-effectiveness characteristic. 

The choice of inspection level is primarily a tradeoff 

between cost and compliance benefits. Absent other good compliance 

needs, the mere showing of the flag does much to keep sources in 

line, and makes it quite reasonable to employ the lower-level 

types of inspection in most cases. Often cursory inspections can 

be justified for sources with good compliance records and of a 

type unlikely to encounter violations. More expensive and intensive 

inspections are necessary to: 1) demonstrate that the agency can 

and will go all-out on occasion, 2) ensure that self-monitoring 

reports are in fact correct. 3) keep inspector training levels 

high, and 4) develop community-wide compliance profiles for better 

program administration over time. 

The selection of sources to be inspected is important, too. 

U.S. programs have only recently begun to more systematically 

evaluate a source's potential to do environmental harm, the 

complexity of the inspection necessary to evaluate compliance at 

the source, its compliance history and that of its industrial 

sisters and neighbors, and the availability of good self-monitoring 

reports and records for prescreening. Amonq the impediments 

have been the lack of effective data management systems to assist 

in analysis of compliance patterns and to systematically compare 

source performance. 

Another important targeting and allocation technique recently 

employed is the use of triggered levels of inspection, perhaps 

alternated with triggered tiers of self-monitoring. For example, 

if a source is found in violation of a minor, easily viewed 

practice standard, the agency might require the source to perform 

more intenalve self-monitoring for a period of time, with a more 

intensive follow-up inspection scheduled should the extensive 

monitoring indicate more extensive non-compliance. The principle 

behind such triggering mechanisms is twofold: First, each trigger 

event itself should be relatively cheap to detect while indicating 

the possibility of other non-compliance discoverable with more 

monitoring. Second, each trigger should tend to shift the next 

burden of data gathering to the source rather than the inspector's 

budget. Under this principle, heavier information collection 

burdens are not imposed until lower-level monitoring or inspections 

have warranted the expense. 
P.35 

111-12 

An important limitation on targeting and allocation techniques 

is the requirement that routine inspections—as distinct from 

inspections where prior reasons exist to believe that violations 

will be found—be fairly distributed across time and across the 

regulated community. Again, longstanding court decisions on the 

constitutional protections against unwarranted searches do. permit 

such routine inspections so long as they are part of a "neutral 

administrative inspection scheme (NAIS)." An agency has broad 

discretion to develop such a scheme; it just has to make sure 

that any apparently disproportionally high inspection rate3 or 

monitoring burdens at a given source are justified by good technical 

reasons. Otherwise, later prosecution of that source might fail 

on grounds of discriminatory inspection practices. 

Another inspection allocation technique that, like targeting, 

has only recently been embraced and tested in U.S. programs is 

shared or coordinated inspections among environmental programs 

and with sister agencies. Such coordination has been successful 

on an intergovernmental basis among sister agencies interested 

in the same manufacturing facility, as with Food and Drug 

Administration, Occupational Health and Safety Administration and 

Toxic Substances Control Act inspections of a chemical plant. 

Multi-media inspections are sometimes but not routinely used by 

EPA or State inspectors.. There are differing views as to whether 

training can be adequate and whether individual serial inspections 

are more or less disruptive to plant operations. 

In overview, U.S. environmental programs have made enormous 

progress in developing and using the technical rudiments of 

compliance monitoring inspections but are only now turning to 

innovative and cost-efficient inspection strategy and management. 

4. Inspection Practices 

The variety of inspection practices employed by government 

inspectors in environmental programs across the U.S. is far too great 

to describe in detail here, particularly when one takes into account 

the various technical operating characteristics peculiar to each 

piece of control equipment in place at each of hundreds of 

thousands o£-facilities. Indeed, that variety is part of the 

inspector-training allocation problem faced by agency administrators. 

Looking acroaa programs, however, it is possible to find common 

approaches to defining different levels of inspection in practice, 

and estimate personnel time necessary to complete a typical 

inspection at each level of inspection detail. 

Level 1 - The simplest of the on-site inspections, this 

visit is limited to walking through a facility, checking only for 

the mere existence of control equipment, work practices and housekeeping, instrumentation, and a records repository. Its primary 

objective is to show the flag, and agency managers typically 

budget from 0.5 to 2 person-days for the effort. 

Level 2 - At this level of complexity, the agency usually 

receives the greatest amount of information per dollar invested. 
P.36 

111-13 

Sometimes called a "non-sampling compliance evaluation," this 

inspection includes detailed review and critique of source 

monitoring methods and data in addition to visual inspection and 

probing of process and control devices in place. It usually 

includes detailed pre-inspection review of source data in agency 

files. The budget allocated at this level runs from 2 to 5 

person-days, and can go as high as 10 or 15 days where several 

control points or ground-water monitors must be visited and analyzed 

together. 

Level 3 - Often called a "sampling inspection," this visit 

includes the visual and record reviews of the simpler inspections, 

but adds the time and trouble necessary to duplicate the source's 

own sampling and laboratory analysis procedures to double-check 

actual pollution emission or discharge rates. Typical budgets 

range from 25 to 35 person-days for such an inspection; the 

figures include the use of outside laboratory services or consultants working under contract to the agency. Sampling inspections 

performed on initial installation of controls (such as air pollution 

stack emission tests) can run two or three times more expensive, 

but such tests are frequently performed at the expense of the 

source with the agency inspector present as an observer. 

Tables III-a-8 through III-a-11 illustrate the variety of individual inspection practices employed in U.S. programs to control 

air pollution, water pollution, solid or hazardous waste, and 

toxic substances. The items included in the table are frequently 

included in inspections; however, relatively few inspections by 

either federal or state agencies include all practices in any one 

visit. 

The inspection practices noted in Table III-a-11 for toxic 

substances are included because they are typical of the steps 

taken by inspectors where extremely hazardous chemicals such as 

PCBs are concerned. They are not representative of inspections 

for compliance with most of the regulations under TSCA, a program 

that like FIFRA is primarily concerned with collecting information 

on the potential hazards from hundreds or.thousands of chemicals 

in use rather than limiting emissions of specific substances. 

C. Area Monitoring 

Sourea self-monitoring and government inspections on-site 

are by far the most important and most common techniques employed 

by U.S. agencies to monitor for compliance with environmental 

regulations. However, it is possible to obtain information on 

compliance status by monitoring environmental conditions in the 

vicinity of a facility, without necessarily walking onto its 

property. Three kinds of area monitoring have been used for 

compliance evaluation in the U.S., with somewhat limited success 

and effectiveness: ambient monitoring, remote sensing, and 

overflights. 
P.37 

111-14 

1. Ambient Monitoring 

The technology for detecting and measuring concentrations of 

pollutants in ambient air and ground or surface waters has been 

in existence much longer than technology for source emission 

sampling and analysis. Ambient monitoring was an important 

scientific and research tool before national legislation transformed 

environmental protection into a major regulatory program objective 

in the 1970s. Indeed, many of the scientific studies of ambient 

conditions and ecological effects provided the justification for 

these regulatory programs. Even today, each federal and state 

agency must conduct some degree of ambient monitoring in order to 

demonstrate its progress towards cleaning up the environment, 

and to evaluate the aggregate amount of new pollution that can be 

permitted in a given air basin, watershed, or aquifer in a given 

year. Ambient monitoring and research are expensive but necessary 

undertakings in the administration of agency programs throughout 

the U.S. today. 

For all their investment in ambient monitoring, however, 

agencies only seldom employ such monitoring for compliance 

evaluations. The single biggest problem in using ambient data 

for compliance purposes is that it is usually very difficult to 

demonstrate a causal link between emissions or discharges from a' 

regulated facility and measured degradation in the quality of 

ambient air or water in the area surrounding that facility. 

Sometimes a source is the only significant polluter in an area, 

or its emissions have a characteristic composition that serves to 

"fingerprint" its contributions to the ambient degradation—even 

though the ambient monitoring instruments may be located a few 

miles away. In this unusual case, routine ambient measurements 

can and do give compliance officers an indication that something 

is probably amiss at the facility, and an on-site inspection is 

warranted. In this respect, ambient monitoring can help agencies 

target their limited inspection resources, or establish "probable 

cause" to conduct an unannounced inspection. But the ambient 

measurements alone are seldom sufficient proof that a sourcespecific emission standard or practices regulation has been 

violated. In any event, most sources are located in or near 

populated areas where contributions from other sources mix into 

the ambient conditions; this makes it impractical if not impossible 

to trace ambient results to a specific source. 

Still, ambient monitoring does find its way into certain 

source-specific requirements, usually imposed as permit conditions. 

In air programs, a source seeking to locate in a clean air (or 

PSD) area must perform ambient monitoring both before and after 

construction to demonstrate that its limited new emissions do not 

cause ambient concentrations to increase by more than the legally 

allowable "PSD increment" in that air basin. Similarly, a source 

that wants to use the emission trading or bubble policy must 

demonstrate that its proposed changes in emission requirements 

will not and do not degrade ambient conditions in its vicinity. 

Ambient monitoring is required of certain water pollution 

dischargers with unregulated toxic substances in their effluent, 
P.38 

111-15 

and dischargers desiring variances from categorical effluefi-t 

standards. Finally, ambient groundwater monitoring—usually at a 

few well locations one-quarter to one-half a mile away—is 

uniformly required for hazardous waste TSD facilities and for 

some underground injection wells. In each of these cases, exceedance 

of an ambient standard may or may not itself be a violation, but 

it is always a -trigger for further action by the facility. Such 

trigger requirements typically include more intensive monitorinq 

and analysis, special reporting, or even supplementary controls. 

2. Remote-Sensing 

Although ambient monitors generally cannot provide positive 

proof of a source-specific output-rate violation, other technioues 

can provide such proof from locations outside the plant's boundaries. 

The single most well-developed remote-sensing technique is the 

laser-beam radar, or "Lidar", for "light detection and ranqing." 

Lidar has been under development for nearly twenty years, 

and has recently,been listed in EPA regulations as an acceptable 

alternative for measuring smoke-plume opacity—that is, the 

density (not mass emission rate) of a plume. An inspector can ,. 

now drive a lidar van near a smokestack, shine a laser beam 

through the plume from a distance, and measure the radar/light i 

echo from the plume so as to yield the particulate density of

 v 

the plume. Lidar can be used day or night, and is much more 

precise and accurate than the socalled "calibrated eyeball" of 

a trained smoke reader. It is also less expensive per measurement 

than in-stack sampling or continuous opacity monitoring. Engineers 

have already demonstrated related lidar capability to measure 

remote concentrations of S02 and N0X, although such remote 

sensing of gasses is a few years away from approval of an equivalent 

method. 

3. Overflights 

Satellites and aircraft have been employed by environmental 

agencies to measure ambient conditions as well as source-specific 

conditions. Like lidar, these remote sensing techniques were 

first developed as ambient monitoring tools for research. 

Satellite sensors remain useful for area-wide assessments and 

planning purposes, but image resolution is generally too coarse 

to identify output-rate for management-practice violations at a 

given facility* Satellites have successfully detected gross 

water pollution discharge plumes, and triggered subsequent sampling 

inspections that led eventually to prosecutions. In this sense, 

satellite data helped allocate site inspection time and resources. 

But satellites are unable to provide the kinds of quantitative 

measurements necessary to prove output rate violations. 

Aircraft overflights can be even more effective than satellites 

in compliance monitoring. From an altitude of a few thousand 

feet, airborne cameras can detect and record air and water plume 

densities, temperatures, and spatial extent. Even some biological 

effects in streams can be detected from the air. Perhaps most 
P.39 

111-16 

significantly, physical characteristics and work practices'are 

easily observed from the air. For example, dikes and fences at 

hazardous waste sites can be observed and checked against permit 

records for correct location and condition. Practices such as 

truck loading at gasoline bulk terminals and hazardous materials 

unloading and handling can be observed. The level of production 

can be gauged from the air and compared to operating assumptions 

in a water discharge permit. 

Although overflights need not cross over plant boundaries 

and thereby violate the airspace rights of the source operator, 

the use of such flights has been recently and successfully 

challenged in court by a major chemical company, at least where 

such flights are unannounced. Both the lower court and the 

appeals court held that such flights violated the company's 

reasonable expectation of privacy in conducting its business 

inside its fences (and environmental authorizing statutes have 

never directly addressed the issues). Such privacy rights are 

an important limitation on all government searches and inspections 

in the U.S. One particular concern was that certain plant 

layouts and practices observable from the air might also be 

trade secrets largely unrelated to pollution control. Under U.S. 

laws, such commercial secrets disclosed to an agency inspector 

are entitled to continued confidential treatment by the agency 

provided that the source has told the agency which data are 

commercial secrets. Even in an unannounced inspection on the 

ground, company personnel can promptly identify for the inspector 

those processes or circumstances requiring confidential treatment. 

But an overflight affords the company no opportunity at all to 

protect confidential trade practices before they are recorded by 

the airborne inspectors. In light of the court decision in this 

case, agencies have curtailed their already-limited use of overflights 

for compliance monitoring. 

D. New Directions in Compliance Monitoring 

Among the most important and interesting developments in 

compliance monitoring in the U.S. are the more widespread reliance 

on source self-monitoring and reporting, and the more sophisticated 

use of inspection targeting practices to allocate limited inspection 

resources moat effectively. Both of these developments have 

already bean discussed. But three other recent developments in 

monitoring policy and practice are worthy of note here before 

turning to a discussion of enforcement procedures: the use of 

parameter monitoring in lieu of emission or discharge monitoring, 

new requirements for third-party certification of compliance, and 

wider use of private environmental audits at regulated facilities. 

1. Parameter Monitoring 

Air pollution emissions and, to a lesser extent, water 

pollution discharges have been costly and difficult to measure 

continuously. Most rules require periodic sampling and laboratory 

analysis to determine the rate at which pollutants are emitted— 

but those samples represent conditions only at the time the sample 
P.40 

111-17 

is taken. It requires a leap of faith for the agency to r;eoresent 

to the public that the results of one daily sample accurately 

portray the overall pollution rate for a facility operating around 

the clock. The sample is even less likely to be representative 

if taken only when control equipment is first installed, or only 

when an annual announced inspection is conducted, since the 

control equipment is likely to be operating less effectively over 

time without regular maintenance. 

In order to ensure continuous compliance, it is necessary 

for source personnel themselves to have continuous readings of 

equipment performance. Yet even after a decade and a half of 

environmental regulation, continuous monitoring technology is 

still expensive and in some instances unreliable. So a few aqencies 

have begun to require continuous monitoring of certain surrogates 

for pollution emissions, rather than the emissions themselves. 

That is, some of the operating parameters of pollution control 

equipment can indicate how well the controls are operating. If 

the agency is convinced that the equipment is designed and 

installed correctly, then it can be assured that output-rate 

standards are being met so long as other parameters indicate that 

the controls are operating correctly and continuously. 

Examples of such operating parameters for air pollution 

control equipment are: line voltage and electrical current drawn, 

blower speed, chamber temperature and pressure, gross gas velocity 

or flux across a calibrated surface, and fuel input rate. These 

parameters are generally inexpensive to monitor, and the instruments 

required are also quite reliable once either the parameter levels 

are properly calibrated to emissions performance at the particular 

facility or ranges are used as screening techniques. Taken 

together with periodic emissions sampling and analysis, and 

equipment inspection, continuous parameter monitoring is proving 

to be a cost-effective way for sources and agencies alike to 

assure themselves that controls are in fact operating correctly 

and continuously. 

2. Certification 

One way for agency inspectors to monitor for compliance is 

to see whether another kind of inspector with a similar objective 

has already done the job. Where the third-party inspector has 

technical proficiency and reliable incentives of his own to 

certify in truth that a source facility meets a given technology, 

emission, or practice standard, the environmental agency may not 

want to duplicate that effort. Today U.S. agencies do not 

accept certificates of compliance in lieu of on-site inspections 

or data reviews but have considered relying on them to a greater 

extent in some circumstances: control equipment installation (relying 

on certification by registered professional engineers), equipment 

performance (relying on manufacturer warranties enforceable by 

either source or agency), analysis of sampled effluent (relying 

on certification by independent test laboratories), and overall 

management practices (relying on inspections by agents for insurance 

companies writing environmental liability coverage). In these 
P.41 

T T 1-18 

circumstances, the role of the agency compliance monitoring, 

program would shift from source monitoring to auditing the . . 

third-party organizations, thereby multiplying the effectiveness 

of the agency staff. 

3. Environmental Auditing 

Not only 'third*-party organizations, but sources themselves 

are finding incentives to double-check and ensure that environmentally 

sound practices have been implemented in their own facilities. 

In addition to the force of environmental laws many firms have 

discovered that valuable materials and energy can be recovered 

from waste streams and reused or resold. Other firms have found 

that growing tort liability for damages from toxic or hazardous 

chemical exposures justifies greater internal testing and control. 

And larger firms whose stock is held by the general public have 

recently been required by securities regulators to fully and 

correctly assess and disclose the dollar value of their potential 

environmental liability, including prospective compliance costs; 

this securities rule alone has led hundreds of U.S. firms to look 

more carefully than ever before at the quality of their internal 

compliance staff and programs. 

As U.S. executives have found other good business reasons to 

examine the effectiveness of their environmental performance, -

they have begun to perform or sponsor private environmental audits— 

that is, independent examinations and verifications that existing 

company compliance assurance programs are in fact working. Each 

time a source manager undertakes such an independent review, he 

or she could potentially eliminate the need for frequent government 

inspection. Today U.S. agencies are experimenting with ways to 

encourage sources to perform these audits. In a parallel development, 

as mentioned above, the federal TSCA program has required audits 

in lieu of penalties in cases of noncompliance with PCB regulations. 

As an alternative to penalties, a required audit is a method for 

increasing the knowledge and capacity of a given company to 

achieve compliance and the Agency to monitor compliance in the 

future. Environmental audits also give the agency greater assurance 

that future self-monitoring reports are accurate and complete. 

Auditing, certification, and continuous parameter monitoring 

initiativea each promises to bring greater assurance to the U.S. 

public thatrits growing environmental concerns are being met more 

effectively and at lower cost by regulatory agencies without 

having to raaort to larger and more intrusive government inspection 

programs. 
P.42 

IV-1 

IV. COMPLIANCE INCENTIVES AND ENFORCEMENT PROCEDURES 

Within the United States literally hundreds of thousands 

of facilities are subject to the environmental laws and 

regulations administered by both the U.S. Environmental 

Protection Agency (EPA) and "approved" states. Major facilities are likely to be subject to regulations and/or permits 

under several statutes, each imposing a large number of 

individual requirements. While all facilities are required 

to comply with all applicable environmental regulations, 

it is impossible to enforce compliance of every facility 

with every requirement. 

The U.S. program is generally based upon the premise 

that a credible enforcement program with tough legal sanctions 

deters the regulated community at large from falling into 

non-compliance, i.e., that enforcement actions at selected 

individual violating facilities provide an incentive for 

"voluntary" compliance efforts by the larger community of •? 

regulated sources. A consistent enforcement response also 

provides an element of fairness to the regulatory process that 

would be missing if those who failed to comply benefit at the 

expense of those who do, or if regulatees are treated very 

differently. Despite the underlying reliance upon an effective 

enforcement deterrent to non-compliance, the full range of 

compliance incentives and enforcement procedures have been 

established to change or influence the behavior of the regulated 

community. 

At one end of the spectrum are actions aimed at promoting 

compliance, such as providing technical assistance. At the 

other end of the spectrum are enforcement responses, 

such as economic penalties and civil or criminal judicial 

actions. Using this range of tools, EPA's challenge has 

been to devise strategies which reflect the appropriate 

balance in both fostering "voluntary" efforts by the regulated 

community to achieve compliance and taking enforcement 

actions against individual sources which fail to comply. 

This chapter is divided into three parts: 

o Compliance Motivation: A brief discussion of the 

theoretical basis, both economic and social, for 

the range of official responses used to achieve 

and maintain compliance; 

o Compliance Promotion: The actions taken by EPA 

and the States to educate the regulated community 

about regulatory requirements, and to encourage 

companies to develop internal programs to ensure 

compliance; and 
P.43 

IV-2 

o Enforcement Response: The tools and procedures 

available to EPA to ensure that violations and 

resulting problems are promptly corrected and to 

deter similar non-compliance in the future. 

A. Compliance Motivation: Theoretical Considerations 

The actions taken by EPA and the States to promote and 

enforce compliance with environmental laws are most effective when they are consistent with, and supportive of, the 

internal factors which motivate compliance. An increasingly 

sophisticated understanding of what motivates regulated 

entities to comply could, therefore, potentially lead to better 

targeted, more effective use of resources to induce compliance. 

Traditionally, EPA's operating assumption has been and 

continues to be that companies comply with regulations primarily 

because of the threat of enforcement that imposes legal and/or 

economic sanction. This assumption only partly explains 

source behavior, since it's clear that not all violations can 

be detected or result in government-imposed' sanctions. 

Economists have theorized that without sufficient economic 

sanctions to make compliance less costly than non-compliance, 

firms would not comply. Economic theory is the basis for the 

recently issued "Uniform Penalty Policy" which establishes 

the principle that a fair and effective enforcement program 

must both recoup the economic benefit from non-compliance 

and impose an additional penalty based upon the gravity of 

the harm created by the violation. Nevertheless, the amount 

and application of penalties are not likely to have been sufficient 

to have significantly affected business economics or compliance 

behavior to the extent evidenced by current levels of compliance. 

If one assumes a rational decision-making model for the 

individuals in a firm (and thereby for the firm as a whole), 

the degree of compliance achieved would depend on the benefits 

perceived relative to the benefits of partial or total noncompliance. In order to evaluate these incentives for and 

barriers to achieving compliance, it is important to recognize 

that companies are not motivated to comply or not comply, 

people arav Thus, a full examination of compliance motivation wou£& address not only what the motivation factors are, 

but also who those factors tend to motivate. 

Within any corporate structure, a range of people may 

be involved in managing compliance, from the chief executive 

officer to the waste treatment plant operator. Senior management 

theoretically would be most concerned with lower profits or 

lessened competitive position because of increased costs or 

poor public image. Plant managers primarily would be concerned 

with keeping production levels up while dealing with the 

added complexity of environmental pollution controls, monitoring, 

reporting, etc. Workers would, perhaps, be concerned about 

the additional workload superimposed on an already busy 
P.44 

IV-3 

and stressful schedule or how their performance is assessed 

if environmental compliance is a factor. Under this model, 

the immediate consequences of environmental regulations 

are likely to be viewed differently and perhaps negatively 

at all levels of the firm. This too does not adequately 

explain the high levels of compliance with many environmental 

requirements. 

The only explanation remaining for the degree to which high 

levels of compliance are achieved would depend, then, on the 

existence of opposing natural or externally-imposed incentives 

which counterbalance the negative motivations. 

Natural motivating forces arise out of three bases: moral, 

short-run economic, and long-run economic. Moral motivation, 

simply, is based on a fundamental sense of social responsibility 

to obey the laws. Additional moral motivation may arise out of 

high environmental protection values or attention to social 

regulation and norms held by key individuals in the firm. 

Those who respond to moral and social motivations might be 

influenced by a limited number of visible enforcement actions 

against others or public sentiment as a signal of new societal 

norms of behavior supported by a "fair" system that punishes 

those who fail to comply. 

Short-run economic factors are those immediate positive 

outcomes that reduce adverse cost or productivity impacts. 

One example would be reduced insurance premiums available to 

firms with excellent compliance records, a factor which does 

not now occur with any significance in practice. Another 

example might be reduced raw materials costs because of 

waste reduction and recycling which are realized in practice, 

but only to a very limited extent. A number of firms 

have, however, pursued and publicized their programs to 

"make pollution pay." 

Long-run economic benefits would include the avoidance of 

future liabilities through tort or environmental damage/ 

clean-up actions. The avoidance of bad publicity that could 

adversely impact a company's sales or stock prices is 

another example. This is a growing concern to firms with 

potentially costly hazardous waste responsibilities under 

the "Superfund" statutes. 

In tha view of the author, the most logical place to 

start in explaining what influences compliance is with the 

natural motivating forces. 

If the combination of these natural motivating forces 

is insufficient to overcome the apparent disincentives of 

compliance, additional measures must be imposed. Such 

measures can be compliance promoting or punitive— deterrent. 

Compliance promotion can reduce the degree of disincentives 

through, for example, research and development or technical 
P.45 

IV-4 

assistance activities to discover cheaper means of compliance, 

or technical assistance and training to reduce impacts on 

productivity. 

Finally, more deterrent or punitive approaches may 

have to be applied. Economic sanctions can directly offset 

the monetary savings of non-compliance and actually impose 

monetary costs. Publicizing companies' non-compliance 

records increases the potential negative long-run impact 

on stock prices or consumer acceptance. On the other 

hand, publicizing data for companies with excellent 

records would be an incentive. 

Therefore, key to a successful and efficient compliance 

promotion and enforcement program is matching enforcement 

approaches to the full range of motivating factors that may 

be at work for individuals and all levels within regulated 

entities. Just as society has not yet developed a predictive 

model of human behavior, it is too simplistic to assume, for 

example, that penalties alone would be sufficient to achieve 

compliance given that they may reach only senior personnel 

who are primarily concerned with the overall economic 

dynamics of a company. Neither are criminal sanctions and f 

bad publicity sufficient even though they can provide even 

more of an incentive than penalties where they are appropriate. 

Management's best intentions go for naught if a maintenance 

worker forgets to close a critical valve on a waste storage 

tank. Similarly, we cannot.assume that training programs 

and technical assistance would be effective only at the 

working level as these programs can raise the consciousness 

of and invoke new management systems from senior management. 

Compliance depends on the involvement and commitment of 

all the parties. 

Determining how best to bring about compliance is a 

complex and continually evolving process. Not only must 

the mix of program approaches address a range of motivations, 

but the effectiveness of compliance approaches shifts over 

time as a program matures. In the early stages, compliance 

promotion—informing the regulated community of what is 

expected—is more important, particularly during the 

period leading up to and following issuance of a regulation 

or standard and before the compliance deadline is reached. 

Depending; upon the degree of social support for the program 

and the acceptance of the anticipated technical solutions 

to pollution problems, enforcement or coercive approaches 

can play a more or less central role in the process of 

gaining widespread compliance and acceptance of new practices 

and behaviors. Enforcement always remains central to addressing 

the recalcitrant sources which do not respond to less 

forceful approaches. 
P.46 

IV-5 

B. Compliance Promotion 

Despite the responsibility of regulated sources to know 

what is required of them and to take steps necessary to ensure 

compliance, EPA has recognized that steps must be taken to 

foster and .promote compliance by the regulated community as a 

whole. In the past, such efforts have neither been extensive 

nor have they formally been viewed as being an essential part 

of the "compliance and enforcement" program. Instead, they 

have been viewed as the final stage of regulation development; 

and sometimes these actions have been neglected. Increasingly 

there is greater emphasis placed on the importance of early 

and successful compliance promotion activities. 

The specific actions used to promote compliance range 

from informing the regulated community of its responsibilities, 

to providing technical information to the regulated community 

on compliance techniques, to encouraging voluntary efforts 

to achieve, maintain, and monitor compliance. 

To assure that members of the regulated community understand 

which regulatory requirements they must comply with and what^ 

those requirements mean, requires in the first instance, the 

issuance of easily understood regulations, policies, standards, 

and interpretations. Moreover, there is a continuing need for 

communication even after a regulation has been in place since 

policy tends to evolve and new regulations are often added. 

Educational efforts may be necessary to ensure even a minimum 

understanding by the regulated community where complex regulations 

are involved. 

Several mechanisms used by EPA to keep the regulated community 

informed are described below. 

1. Cooperation with Trade and Industry Associations: EPA 

often uses information exchange accomplished by working cooperatively with industry and trade associations. EPA personnel 

regularly maintain contact with trade and industry associations 

through conferences, seminars, and other public meetings. 

Such activities provide an arena for the exchange of information 

and ideas between the regulated community and the regulators. 

As examples, EPA has undertaken a cooperative survey with 

the electric industry's association to determine the degree to 

which its members use continuous emissions monitors (CEM) and 

to identify the associated technical and administrative problems. This survey was followed by an EPA-sponsored national 

conference with the association, CEM manufacturers, and air 

pollution control agencies. As a result, EPA has established 

itself as a clearinghouse for CEM information and a source 

that industry can use extensively. 
P.47 

EPA also has worked with the Can Manufacturers Institute 

to produce a compliance handbook for the can coating 

industry. With this handbook, can coaters and regulatory 

officials can better understand the process of can coating, 

the various compliance approaches, and compliance schedules. 

2. Training and Technical Assistance: Educational programs 

are used to promote compliance and in some instances are an 

integral part of program operations. Perhaps the most 

wide spread compliance promotion tool in this area is the 

pesticide applicator training and certification program 

under the Federal Insecticide, Fungicide, and Rodenticide 

Act (FIFRA). This program, conducted by EPA and/or the 

States themselves, ensures that both private and commercial 

applicators not only are aware of pesticide use requirements 

and are generally competent to apply pesticides, but also 

are competent to apply restricted-use pesticides. 

In some cases, provisions for educational programs are 

embodied within the environmental statutes or regulations. 

Like the educational programs conducted under FIFRA (described above), other acts provide similar mechanisms for 

education. For example, the Toxic Substances Control Act 

(TSCA) contains a provision requiring EPA to maintain a TSCA 

Assistance Office. This office prepares and disseminates 

information on TSCA requirements to industry and the general 

public and responds to specific questions by individuals. 

The TSCA program also has established a special contractor 

service to provide direct assistance to small businesses 

attempting to comply with premanufacture notification 

requirements. 

EPA also has established a hotline to provide information 

on the hazardous waste program reguirements to the regulated 

community. This hotline answers 50,000 calls annually. 

Apart from specific media program efforts and Agency programs to provide technical assistance, regional, state, and 

county agencies have developed programs to assist those 

industries within their specific area. One noteworthy example 

is the Industrial Assistance Program initiated by Erie County's 

Department of Environmental Planning in New York State. A 

primary function of this program is to help local firms 

solve environmental problems that impose technical or financial 

burdens which threaten their continued operation. Additionally, 

companies that are either starting a new facility or expanding 

an existing operation within the county can get assistance 

in locating the necessary environmental resources needed to 

accommodate new pollution sources in accordance with federal 

and state environmental regulations. 

Finally, EPA is sponsoring a one-year pilot program in 

coordination with the Georgia Institute of Technology and 

the State of Georgia. The program consists of free, on-site 
P.48 

IV-7 

technical assistance to Georgia industrial firms to assTst 

in improved hazardous'waste management practices. If it 

proves to be as promising as it appears, it is hoped that 

this or similar service can be adopted by many more States, 

using local land-grant universities or other appropriate 

institutions. 

3. Guidance Documents: EPA has prepared numerous 

guidance documents, and technical and other material which 

assist the regulated community in complying with the various 

environmental laws and regulations. Many of these were not 

specifically designed for this purpose but demand for them 

is a good indication that the need is there. For example, 

the air program's industry-specific inspection guides, 

which are made available to industry, explain how to evaluate 

whether pollution control equipment is operating properly. 

Other programs have comparable materials. The compendia 

of compliance policies and interpretations for each program 

are available to the regulated community as well as to 

Regions and States. 

4. Small Business Ombudsman Program: In addition to 

the ongoing mechanisms described above to promote compliance * 

through informing the regulated community, that EPA has 

undertaken other ad hoc, special-purpose approaches. One such 

example is the Small Business Ombudsman Program which EPA 

launched in 1982. Under this program, an EPA regulatorv 

liaison to the small business community has been designated 

to coordinate the Agency's compliance assistance and policy 

efforts. A number of initiatives are being undertaken to 

identify and evaluate problems that small firms may be 

facing in complying with environmental regulations. These 

initiatives include surveying trade associations and small 

business owners and operators to understand what smaller 

firms see as their most serious compliance problems; 

improving the effectiveness of EPA's communication and 

coordination with small companies; providing day-to-day 

compliance assistance to specific firms via a toll-free 

hotline; and maintaining regional liaison with small business. 

5. Encouraging voluntary Compliance: As EPA continues 

to expand it* efforts toward increasing the effectiveness 

of its compliance programs, it has attempted to create a 

climate whlaft encourages voluntary efforts on the part of 

regulated entities to monitor themselves and ensure compliance. 

As described in the previous chapter, compliance 

inspections are primarily a compliance monitoring tool. 

During or following these inspections, discussions of the 

requirements and alternative means of complying frequently 

occur. These discussions provide an important opportunity 

for educating the regulated community on a one-on-one basis 

concerning specific requirements and the need to comply. 
P.49 

IV-8 

This approach is a primary vehicle used by many States'" a-s 

part of a general program of persuasion which these States 

prefer to taking formal enforcement action. 

Several environmental statutes and regulations require 

individual operating facilities to monitor and report on 

their own compliance. In addition to providing a compliance 

monitoring vehicle, such requirements are often imposed as a 

means of encouraging voluntary compliance, since they ensure 

there is a means for facility operators to identify and 

correct problems promptly. 

As another means of encouraging voluntary compliance, 

EPA has been promoting internal compliance assurance/environmental 

auditing programs within industry for the past two years. 

Environmental auditing is a systematic, independent evaluation 

of activities undertaken by a company to assess and verify 

the environmental performance of its operating facilities. 

EPA considered developing a mandatory requirement for Agencyapproved environmental auditing programs and also explored 

whether a voluntary incentives-based approach made sense 

through for example, reduced penalties, fewer inspections, 

or reduced reporting requirements for firms voluntarily 

developing EPA-approved auditing programs which not only 

identified but also corrected and prevented problems in a 

timely manner. Because of legal and industry concerns to 

and anticipated administrative problems, to date EPA has 

abandoned plans to require auditinq or to provide affirmative 

incentives and has adopted a three-pronged approach to promote 

environmental auditing: 

o Endorsement: Acting as a clearinghouse on auditing practices, sponsoring workshops and other 

mechanisms to transfer auditing information, 

showcasing private-sector programs to serve as 

models, and working with interested parties. 

o Analysis: Understanding what auditing is and what 

it can do. 

o Assistance: Supporting States or industry groups 

wanting to pursue joint private/public environaantal auditing approaches. EPA has conducted a 

aaries of analyses designed to develop a national 

clearinghouse and model for state auditing programs. 

In a limited context, the Agency also has accepted the 

adoption by industry of audit programs in exchange for 

mitigated penalties in a few isolated "experiments" involving 

responses to violations, relating to f-^Bs under the Toxic 

Substances Control Act. 
P.50 

IV-9 

EPA senior management officials are continuing toTc

rlosely 

examine environmental auditing for potential policy initiatives 

to promote improved compliance. The application of environmental 

auditing to federal facilities seems to hold the greatest 

promise given their special obligation to ensure compliance 

and the mandate by Executive Order of the President for U.S. 

EPA to work' cooperatively with them and prohibiting court 

suits against federal facilities (although it should be 

noted that States can but are often reluctant to pursue 

formal enforcement actions against federal installations). 

6. Public Pressure: The U.S. EPA has used public pressure 

primarily to promote compliance through public disclosure of 

asbestos in schools and unsafe drinking water. It has been 

viewed as potentially most effective when used against public 

officials in a situation which would be of concern to the 

citizenry. 

B. Enforcement Responses 

As noted above, the general view within the U.S. held by 

the public, Congress, and government officials is that the 

most effective way to promote compliance is through a credible 

enforcement program. A credible enforcement presence is 

therefore, viewed as the prerequisite to ensure that regulated 

parties have an incentive to pursue "voluntary" compliance 

efforts. In this sense, one could argue that compliance is 

never entirely "voluntary." 

The many statutes for which EPA is responsible provide 

a wide range of enforcement responses to violations of environmental laws and regulations. While each statute has somewhat 

different procedures and authorities, they share certain 

characteristics. At one end of the enforcement spectrum is 

a variety of informal responses such as warning letters and 

phone calls. Beyond these informal responses, federal and 

state agencies use civil and administrative legal remedies 

and sanctions. Recently, with the growing public awareness 

of the problem of illegal hazardous and toxic waste disposal 

activity, and the maturation of the older environmental 

statutes—such as the Clean Water Act—a professional, criminal 

investigations and case development capability has emerged 

at EPA to supplement the civil enforcement programs. Federal 

and state programs differ somewhat as discussed in Chapter 

V. This discussion will focus on EPA authorities. 

Figure IV-1 outlines the enforcement procedures specified within the major environmental statutes. 

The balance of this section describes the fundamental 

goals of enforcement response, the type of enforcement response 

tools available, and the factors influencing how the various 

responses are selected and used. 
P.51 

rv-io 

TABLE IV-1 

ENFORCEMENT PROVISIONS OF MAJOR ENVIRONMENTAL STATUTES: 

Types of Relief Explicitly Authorized and Forms of Action 

CAA 

Stationary 

Administrative Enforcement Actions 

Administrative Order Authority 

Type: 

- Compliance Schedule X 

- Emergency Order X 

- Testing X 

- Monitoring X 

- Prohibition (i.e., X 

Construction or Manufacture) 

- Labeling, Limit tions 

on use. Distribution, etc. 

Administrative Penalty Authority x_[£ 

Other Sanctions 

- Contractor Listing X 

- Suspension of Permit 

- Limitations on Financial Assistance X 

Civil Judicial Action 

Injunctive relief X 

Penalty/Punitive damages X 

Seizure 

Emergency powers X 

Criminal Judicial Action 

Penalty/Punitive Damages X 

Imprisonment X 

CWA TSCA KCRA CERCLA SDWA Fl 

Mobile 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

h 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

U Administrative Penalty Authority is just to recoup the economic 

benefit of nun-compliance. 

_|£ Although not explicitly authorized. Section 106(a) of CERCLA is 

probably sufficiently broad to cover these areas. 

J___ Only administratively imposed penalties can be collected through 

a judicial action. 

!2 

X 

X 

X 

X 

X 

X 

X 

X 13 

X 

X 

X 
^52^ 

IV-11 

Goals of Enforcement Response 

In choosing the appropriate response to an identified, 

non-compliance situation, program officials seek to balance 

several goals: 

o Correction of the violation as quickly as possible 

in light of the applicable law, the technological 

feasibility of the corrective action needed and the 

ongoing environmental risk presented by the 

violation. 

o Deterrence of future violations by the same party 

or by other parties. 

o Eguitable treatment of the regulated community 

through use of a uniform approach to selecting 

enforcement responses (i.e., similar violations are 

treated similarly; violators do not realize economic 

gain by non-compliance). 

o Punishment of serious, willful wrongdoing by f 

imposition of criminal sanctions. \: 

* 

o Effective use of enforcement resources by using 

the least resource-intensive response that permits 

the other national environmental goals to be achieved 

and corresponds to the health and environmental 

risks involved. 

Beyond these general goals, each environmental program 

has other specific objectives. 

Types of Responses 

A broad array of possible enforcement responses is 

available under each environmental law. In most cases, 

environmental officials have room to exercise judgment in 

determining whether or not to pursue a formal enforcement 

action if a regulated source is determined to be out of 

compliance. For example, EPA may decide not to pursue an 

enforcement action as a response to non-compliance problems 

which fail below thresholds of severity that are established 

in Agency guidance. 

In almost all cases where EPA or state officials discover 

a non-compliance situation of any significance, the responsible 

agency does pursue some type of enforcement response, traditional 

enforcement responses generally can be categorized into five 

basic types of response which are described below in order of 

increasing severity: 

1. "Informal" enforcement response; In many instances, 

program officials use informal discussions with sources 
P.53 

IV-12 

found to be out of compliance as a means of gaining expe^ 

ditious compliance. In these instances there is a heavy 

reliance on personal relations and good faith in convincinq 

sources to take the necessary steps to correct problems that 

have been discovered. 

Informal .notification can take a number of forms, several 

of which are described below: 

Telephone Call. One of the simplest methods of informal notification is a telephone call reminding the party 

that a violation has occurred and that action is required 

on his part. Such notification may include a follow-up 

request to report on corrective action taken. 

On-Site Visit. Another method is to schedule an on-site 

visit i.e., inspection. A representative of the Agency 

informs the operator of the problem and ascertains 

whether the situation requires more formal action. The 

advantage of this method is that it is often quick and 

very effective, thereby eliminating the resource commitment 

required for a more formal response. However, agency 

representatives have to be careful not to undermine the A 

principle that the violator has ultimate responsibility 

for deciding how to comply and for achieving compliance.f 

Warning Letters. Warning letters can take a variety of 

forms and may be used for all types of violations. 

Generally, warning letters advise the violating party of 

the violation and the need for compliance. They can 

also advise the violating party of the potential penalties 

which could be imposed under the appropriate environmental 

statute. Compliance may be obtained more easily if 

attention is drawn to the potential costs of continued 

non-compliance. Finally, these letters can require a 

response from the violating firm detailing the corrective 

action taken to achieve compliance. 

Warning letters may provide an opportunity for the 

violating party to meet with the Agency and discuss 

compliance. If the firm fails or refuses to take 

advantage of this opportunity within a reasonable time, 

for example, 30 days, other steps are considered. 

However", even after commencing formal enforcement 

actions, negotiations may continue. 

Notice of Violation. Notices are more formal than warning 

letters and are sometimes specifically mentioned as a 

prerequisite to more formal enforcement actions. They 

put a source on notice that a violation has been detected 

and often include a time within which a source must 

respond and/or take corrective action. 

The particular type of informal notification used by 

the government enforcement branch takes cost and effectiveness into consideration. For example, in some cases, 
P.54 

IV-13 

the quickest and easiest method of informal notificationTis 

the warning letter, as on-site visits could take the better 

part of a day and may be resource intensive. 

Generally, informal actions are used for lower priority 

violations and for first-time violators. Since the violator 

is not provided a formal opportunity to refute the charge, 

failure to respond to such enforcement actions cannot itself 

constitute an independent violation qualifying for a more 

serious response. Hence they are not independently enforceable. 

Records of such previous informal enforcement actions can, 

however, be used to support seeking more serious penalties 

in future enforcement proceedings. 

2. Formal Administrative Enforcement Responses: For 

more serious or continuing violations, Agency officials at 

the national level are usually empowered with authority to 

bring an administrative action, this authority varies at 

the state level. Administrative responses are formal, legal 

actions which result in an order from the Agency itself for 

the violating firm to correct the violation and, in some 

instances, to pay a civil penalty amount commensurate with 

the seriousness and circumstances of the violation. The 

line between informal and formal enforcement response is 

often difficult to define, as some States call a notice of •'-

violation something that in effect operates like a formal 

administrative order. EPA has recently defined the following 

characteristics of a formal administrative action in order 

to introduce some consistency to the concept. It should: 

o explicitly require the recipient to take some corrective/remedial action, or refrain from certain 

behavior, to achieve or maintain compliance; 

o explicitly be based on the issuing Agency's determination that a violation has occurred; 

o requires specific corrective action, or specify a 

desired result that may be accomplished however the 

recipient chooses, and specify a timetable for 

completion; 

o perhaps impose requirements in addition to ones 

ralating directly to correction (e.g., specific 

monitoring, planning or reporting requirements); 

and 

o contain requirements that are independently enforceable 

without having to prove the original violation and 

subjects the person to adverse legal consequences 

for non-compliance. 

Because these orders impose legal sanction and can affect 

individual property and other constitutional rights, such 

actions at the federal and state levels often are subject to 
P.55 

IV-14 

Federal and State Administrative Procedures Acts, which provide 

appeals procedures and opportunities for hearings before 

impartial administrative judicial officers. There are exceptions however;, for example, APA procedures are not applied 

to Administrative Orders (AO) under CAA $113, CWA S309, CERCLA 

$106, and virtually all emergency AO authorities. 

Many administrative actions by EPA operate within EPA's 

internal administrative legal system, which is analogous to 

any court system hearings are presided over by administrative 

law judges (ALJs) dedicated to working on EPA matters. Under 

the Agency's Consolidated Rules of Practice, and as required 

by the U.S. Administrative Procedures Act (APA), violating 

sources receive a formal complaint from EPA. The response 

to a complaint must be filed with a Regional Hearing Clerk 

within 20 days of service of the complaint. At that point 

an ALJ is assigned to the case and a hearing may be held 

either at the request of the respondent or the ALJ. Preliminary 

negotiations can lead to settlement prior to a formal hearing. 

If that is the case, the ALJ must agreo with any consent 

agreements. The judicial officer of the Agency must then 

review the document and it becomes a consent order. If there 

is no settlement, the ALJ makes an independent ruling on 

the "administrative action." Violating firms may further 

appeal an ALJ ruling to the EPA Administrator, and ultimately 

to the U.S. civil court system. 

Administrative actions are strong enforcement tools; if a 

company violates the terms of an administrative order, EPA 

may seek U.S. court action to force compliance with the 

order. Administrative actions have the potential to be 

challenged in court, so conduct of such actions is governed 

by an extensive set of procedural rules designed to provide 

due process to the alleged violator and ensure the integrity 

of the system. 

In some cases, the statute specifies when an administrative 

order is to be issued and how it relates to less formal 

administrative responses. For example, Section 113 of the 

Clean Air Act states that whenever the Administrator finds 

that any person is in violation of any requirement of an 

applicable-implementation plan, he shall notify the person 

in violation of the plan. If the violation extends beyond 

the 30th day after the date of notification, the Administrator 

may issue an order requiring such person to comply with the 

requirements of the Act. 

Generally the most expedient formal means of achieving 

compliance, administrative orders are used heavily by programs 

with this authority. There are other administrative actions 

which can have a substantial impact on source behavior. These 

other mechanisms are not frequently used but are significant 

when they are and include authority to revoke licenses and 

permits, to formally list contractors as ineligible for 

federal government contracts, grants or loans, etc. 
P.56 

IV-15 

3. Civil Judicial Responses; Civil responses are 

formal actions taken in the U.S. Court system by the U.S. 

Department of Justice (DOJ) at the request of EPA or by the 

State Attorneys General at the request of a state aqency. 

Judicial cases are typically used principally against serious 

or recalcitrant violators of environmental laws, or to seek 

prompt correction of imminent hazard situations posing an 

immediate threat to human health or the environment. Civil 

judicial enforcement responses often can pursue penalties 

and injunctive relief which may govern corrective action or 

future behavior. 

Preparation of these cases is resource-intensive, both 

because of the formalized procedures required for court 

actions and the involvement of other organizations such as 

the Department of Justice and State Attorneys General in 

preparing for and conducting litigation. The Department of 

Justice and State Attorneys General have the discretion to 

bring an action to court or to take no action. They may also 

have authority to take action independently without a referral 

from an environmental agency. But as a practical matter this 

does not occur. Similarly, if DOJ declines a case, EPA may ?• 

pursue it independently. In some instances, litigation may 

take several years to complete. EPA and state counterparts 

must take these resource demands into account in determining 

which violations are most appropriate to address through 

civil litigation. 

4. Criminal Judicial Responses: Criminal enforcement 

is pursued when punishment is an appropriate legal goal, i.e., 

when a person or company has knowingly and willfully committed 

a serious violation of the law or has fraudulently reported 

compliance or other data to an agency. The major environmental 

statutes have particular provisions for what constitutes a 

criminal violation as do broadly applicable laws on criminal 

fraud. Examples include instances where an individual: (a) 

knowingly and willfully violates the statute; (b) knowingly 

makes any false statements, representation, or certification; 

or (c) knowingly renders inaccurate a monitoring device. 

While civil responses often address corporate wrongdoing, 

to correct the environmental problem, criminal responses often 

seek to prosecute the individual taking the illegal action through 

fines or incarceration which secondarily results in corrective 

action. Criminal sanctions are sought for such actions as 

flagrant disregard for environmental rules (e.g., "midnight 

dumping") and deliberate falsification of documents or records. 

Criminal cases are the most difficult to pursue; they require 

special investigative and case development procedures as 

well as the highest standard of proof, including proof of 

the intent of the violator to commit the prohibited act. 

Proof in criminal cases must establish the requisite violation 

"beyond a reasonable doubt" whereas in civil cases it need 
P.57 

IV-16 

only by a "preponderance of the evidence." This is because 

the constitutional protections are greatest where personal 

liberties may be significantly curtailed, in this instance 

through a jail term. 

The process for bringing criminal complaints against a 

facility that fails to comply with environmental laws and 

regulations is similar to civil judicial cases in that a 

referral is made by EPA to DOJ or State Attorney General if 

a State agency is involved. It is more likely here that DOJ 

might act on its own and exercise more judgment independent 

of EPA's about which cases to bring. A trial is preceded by 

a grand jury proceeding in which a determination is made as 

to whether an indictment should be issued and the case pursued. 

Timeliness and Choice of Appropriate Enforcement Response 

Selecting the appropriate enforcement response does not 

necessarily require starting with the least formal action 

e.g., informal' notification, and then proceeding through 

the other options. As discussed above, each environmental 

statute provides for an array of possible enforcement responses. 

While the specific enforcement procedures vary from statute . 

to statute, they can be portrayed in a number of general 

categories, as shown in Figure IV-3. This figure shows 

examples of some of the generic activities that typically 

may occur as EPA pursues the various enforcement responses 

(informal, administrative, civil, criminal), and is not 

intended to portray a complete view of the enforcement process. 

As Figure IV-3 shows, each of the formal responses can 

be pursued either directly or as a result of having pursued 

a "less formal" response. For example, in response to a 

specific non-compliance situation, EPA may decide to initiate administrative action initially (e.g., formal complaint), 

or may do so after having pursued a series of informal responses 

Likewise, while EPA may refer a case to DOJ for civil or 

criminal action immediately upon discovering a non-compliance 

situation, the Agency is much more likely to do so only 

after a series of administrative actions fail to achieve the 

appropriate correction of the situation. 

In tens* of timing, informal and administrative actions 

are generally less time-consuming than civil or criminal 

action. In the past, informal action has often gone on for 

several months before more formal action is taken. It is 

not uncommon for administrative action to continue for several 

years. Frequently, a non-complying source will negotiate 

and follow a series of compliance schedules, and final correction 

of the situation may take several years. Thus, each of the 

boxes in Figure IV-2 has a period of time associated with it 

which varies from situation to situation. 
P.58 

IV-17 

FIGURE IV-2 

GENERIC FLOW OF ENFORCEMENT RESPONSE 

» 

M » 

Xafotaal 

•r 

Initial Action 

• Telephone Calls 

• Uamlng Letter 

- Negotiation 

J, 

FellewOp 

Inspection 

• 

• 

• 

e 

Non-Coapllance 

* 

XV 

Administrativeii 

i 

.,,\ 

J 

*K 

Civil 

* 

Forral Coaplaint 

" Negotiation 

• AU Hearing 

a 

Consent Agreeaent 

- Consent Order 

• Appeals 

- Penalty/Schedule 

A 

Pollow-Up 

Xnapectloa 

• 

. .... V t 

Settlement or 

Further Action 

\ 

4 / 

Criminal 

• 

1 

f \ 

r*~ 

* 

Depart**— of Justice Rcft-fr,'. 

- Negotiation 

* Court Crier 

.,_,.,_ s f 

FollowUp Inspection 

U Appl :

e s rr- -VSri.i •>.-•' . '• ' • '.-::! ' 

T«.' i •-s--r- ^ 
P.59 

IV-IB 

In order to introduce more discipline into the enforcement 

EPA has developed, definitions of what constitutes timely and 

appropriate action must ultimately be assessed on a casespecific basis EPA has defined milestones in each progran 

which will serve as: (1) general targets to strive for in 

good program performance; (2) trigger points EPA and States 

should use to review progress in individual cases; and (3) 

presumptions that, if exceeded, EPA may take direct enforcement 

action after consideration of all pertinent factors and 

consultation with the State. We will be using these milestones 

with States and Regions to assess whether cases are expeditiously 

progressing toward resolution. 

The concepts behind our definition of timely and appropriate 

response are straightforward. The milestones include a point 

at which the clock starts — when a violation is detected. 

The administering agency is then expected to take some action 

in response to the violation within a specified period of 

time. This response can be a phone call, notice of violation, 

etc. In the air program this is 45 days for major sources 

except for hazardous air emissions and this period is 30 days 

for Water (NPDES) and hazardous waste. The agency is expected 

to use whatever enforcement tools it deems appropriate to 

achieve compliance, but at a specified point in time, either 

the source will have achieved compliance or the agency is 

expected to initiate a formal enforcement action, i.e., a 

judicial referral or formal administrative action meeting 

certain criteria. For example, this time period is 120 days 

in the Air and Water (NPDES) programs. The case is then tracked 

until compliance is achieved. Firm, final compliance dates 

must be specified. 

Where penalties are required this process is slightly 

altered. Depending upon what enforcement vehicle is required 

to impose a penalty, a state or federal official may have to 

proceed directly to a formal administrative order or judicial 

referral. 

The timeframes are program specific and will be adjusted 

to accommodate different State authorities and procedures. 

The timeframes will generally apply only to significant noncompliance, at least until both EPA and the States have more 

experienca in using them for managing the enforcement programs. 

The choice of appropriate response is to be defined by 

each program and applied on a case-by-case basis taking unique 

factors into account. With three exceptions, the form of the 

enforcement response is not viewed by EPA as important by 

itself, as long as it achieves the desired compliance results. 

The exceptions generally fall into the following three 

categories: 

(1) If compliance has not been achieved within a certain 

timeframe, the enforcement response should meet the 
P.60 

IV-19 

minimum reguirements for a formal enforcement 

response; 

(2) If EPA has identified the class or case as one 

requiring a penalty or eguivalent sanction because 

of the need to create a strong deterrence to noncompliance, only certain enforcement vehicles can 

provide penalties; or 

(3) In limited circumstances a judicial action or sanction 

is the only acceptable enforcement tool, for example, 

where a compliance schedule for federal requirements 

goes beyond federal statutory deadlines. 

Program officials choose responses based on the facts 

of the case and the factors set out above. 

Factors involved in choosing the appropriate response 

are the gravity of the violation, the circumstances surrounding 

it, and information about the violator. 

Gravity of the violation. The gravity of the violation^ 

is determined by assessing the actual or potential harm . 

to human health and the environment presented by the 

violation. In the case of a recordkeeping, reporting, 

or data submission violation, the gravity factor is 

based on the extent to which failure to comply affects 

or could affect the Agency's ability to perform its 

regulatory functions to properly assess whether there is 

a health or environmental risk. The gravity of the 

violation is linked to program priorities; the most 

serious violations are also the highest priority for 

enforcement action. 

Circumstances of the Violation. The circumstances of 

the violation can also influence the enforcement 

response selected. For example, could the violation 

have been prevented or did it occur-because of circumstances beyond the control of the violator. If the 

violator made efforts to identify, report, and correct 

the violation independent of the enforcement response, 

this tab could influence the type of response selected. 

Information Regarding the violator. Certain information 

about the violator can affect the choice of response. 

This information includes, but is not limited to, the 

violator's past compliance history and.the economic 

benefits the violator accrued as a result. 

Other considerations which affect the choice of response 

include whether there is sufficient evidence to document the 

violation and link it to the violating party, whether taking 

the action is likely to establish a precedent that is desirable, 
P.61 

IV-20 

and whether taking a given action is important to maintaining 

a credible enforcement presence. These factors, as well as 

a violator's ability to pay, are also considered in deciding 

whether to pursue civil penalties, and for what amount. 

PenaltiesThe penalty policy of each environmental statute is 

intended to provide a strong economic deterrent to non-compliance 

as well as provide equity and incentives to those who want 

to comply with environmental requirements. The explicit 

statutory bases for penalties are summarized in Table IV-3 

and differ from program to program. Penalties can be imposed 

in conjunction with administrative or civil or criminal 

judicial enforcement actions. Some major programs such as 

the Federal Clean Water Act do not now have administrative 

penalty authority and any penalties would require court 

action. The U.S. EPA has requested that Congress grant this 

additional authority. In general, the penalty may be determined 

on the basis of a number of factors but must be within a 

statutory maximum. 

Payment of penalties does not grant any right or privilege 

to continue to operate in violation of the law or to slow 

down compliance. To be effective, violators must not perceive 

penalties as pollution fees. Penalties bear a paradoxical 

relationship to the goal of swift compliance. On the one 

hand, no one likes to pay penalties. Consequently, asking 

for substantial penalties raises the risk that violators 

will choose to litigate rather than cooperate. On the other 

hand, failure to obtain large enough penalties will eventually 

lead to the perception that the Agency's enforcement program 

either is unfair or lacks resolve. Either perception might 

result in a lower rate of compliance. 

The U.S. EPA has recently issued a "Uniform Civil Penalty 

Policy" which sets forth the policy basis for assessing 

penalties where discretion is available, to the agency — 

affecting penalty amounts, not whether and under what circumstances they will be imposed. Under this policy, there are 

two components of a penalty. The first is an economic benefit 

components from delayed compliance. The EPA intends to recoup 

the amouat saved by the source by delaying the implementation 

of treafant techniques or installation of treatment equipment. 

These savings usually arise from the opportunity to invest 

capital elsewhere and the avoidance of operation and maintenance 

expenses. If the amount saved is less than $10,000, then 

this part of the penalty need not be calculated and assessed. 

The second component of the penalty is a gravity component. 

The gravity component is designed to reflect a ranking of 

different types of violations according to the seriousness of 

the act. In creating that ranking, programs consider the 
TABLE IV-3 

SUMMARY OF PENALTIES AND IMPRISONMENT PROVISIONS 

(In Order of Magnitude) 

Civil 

Citation Penalty 

(Hot aore than) 

1. Safe Driaklac Hater Act 

2. Super funs' 

3. Clesn Hater Act 

1414(b) 

1423(b) 

109 

309(e) 

3013(e) 

$5,000/day 

$5.00D/day 

$10,000/day 

$10,000 /day 

4. Toxic Subatencea Control Act 

5. Clean Air Act 

4. Resource Conservation and 

Recovery Act 

l»(a) 

147 

205 

303(b) 

3008(a)(3) 

$2S,000/day 

$25,0O0/day 

$10,000/day 

$S,000/day 

$25,000/day/ 

violation 

$S,000/day 

Citation 

1414(c) 

1423(b)(2) 

103(c) 

103(d) 

309(c)(1) 

309(c)(2) 

16(b) 

113(c)(1) 

113(c)(2) 

3000(d) 

3000(d) 

3008(a) 

3008(g) 

3008(e) 

Criminal 

Penal* 

(Not than) 

$5.000/<Uy 

$10,000/day 

$10,Q00/year 

$20,000/year 

$2,SOO-$2S,0O0/day 

Second violations 

$50,000/day 

$10,000/day 

$2S,000/day 

$25,000/4ay 

Second vlolatloni 

$50,000/day 

$10,000/day 

$S0,000/oay 

$2S,000/day 

$250,000 

$250,000 

$1 alllion 

aajriaonawit 

M * toaaoeeB) 

None 

•one 

1 year 

1 year 

1 year 

2 yeara 

4 aontha 

1 year 

1 year 

2 years 

6 aonthe 

1 vear 

2 .eara 

2 yeara 

5 ears 

I 
IV-2 2 

actual or possible harm, and the importance to the regulatory 

scheme of the violated requirement. Quantifiable factors 

particular to the case are then taken into account including 

the amount of pollutant, its toxicity, sensitivity of the 

environment, length of time a violation continues and the 

size of the violator. 

Once applied to a specific case adjustment factors can be 

introduced in settlement negotiations or in requests to the 

court which take into account the source's culpability, degree 

of cooperation, history of non-compliance and ability to pay. 

In order to promote fairness and consistency, for each of the 

above, EPA lawyers have been granted a range of discretion 

within which they may adjust the penalty requested. 

EPA will generally not request penalties that are clearly 

beyond the means of the violator. The reasons for inability 

to pay must be carefully scrutinized. Depending on the facts 

and circumstances of each case, the following alternatives 

may be considered: 

o Seek the full penalty (a lien on the supplier's 

property may also be sought so that a recorded 

judgment will be had and recovery assured); or 

o Recommend that a time payment arrangement be made 

(a lien may also be sought here); or 

o Consider non-monetary alternatives such as public 

service activities; or 

o Recommend that the penalty be postponed or forgiven in part or jin toto. 

This is particularly important with respect to small 

organizations where the calculated penalty may be disproportionate to the resources of the violator. 

Typically, the sum that is actually assessed and then 

collected is substantially lower than that calculated by any 

fixed formula. This is because within settlement negotiations, 

agency attorneys balance the costs and benefits of continuing 

adversarial proceedings versus conceding to the source a 

reduced panalty. Considerations often include the strength 

of the caae, compelling public interest and compelling equities. 

The Uniform Civil Penalty Policy explicitly provides incentives 

to settle and disincentives to litigate. Reductions in the 

gravity component of the penalty will be made for settlements 

with expeditious remedies to environmental problems and/or 

accepting additional environmental cleanup in lieu of penalties 

only if agreed to in pre-litigation settlement. By increasing 

the penalty amount which EPA pursues until the violation is 

corrected, EPA will be discouraging protracted litigation. 

Sometimes creative settlements will apply or credit penalty 
P.64 

IV-2 3 

amounts against environmentally beneficial actions undertaken 

by the violator. This can be important leverage in expanding 

the environmental benefits from an enforcement action. For 

example, some consent decrees have included provisions for 

environmental audits at all of a firm's facilities in lieu of 

penalties. Ultimately, however, it is the courts that levy a 

civil penalty and this too can influence the final assessment. 

Role of Negotiations: Formal enforcement proceedings, 

whether administrative or judicial, are time consuming and 

costly to both EPA and the violator. Whenever possible, EPA 

seeks to negotiate an equitable court settlement with the 

violator. Indeed, the great majority of formal administrative 

and judicial hearings reach negotiated settlements rather 

than adjudication. Negotiations are a cost-effective way to 

address violations as long as they result in an agreement 

which achieves the enforcement goals described above. 

Because negotiations can be effective only if the threat 

of litigation is real, EPA strives to adhere to a strict 

schedule for the conduct of the negotiations in parallel 

with preparation for litigation. If an acceptable agreement 

is not reached within the specified time period, EPA will 

begin litigation. To further the incentive for companies to 

reach settlement, penalty amounts may be increased if the 

Agency is forced to resort to litigation. -

The Agency is currently developing a decision model for 

negotiations under the abandoned hazardous waste site clean-up 

program—Superfund. This model shows when it is cost-effective 

for the government to continue with a court suit or settle. 

These cases are quite complex, involving multiple parties. 

It is uncertain whether the potential users, particularly 

lawyers will feel comfortable in using the model to achieve 

a more cost-effective enforcement program. 

Under its "Uniform Penalty Policy," FPA will pursue two 

basic approaches to promoting quick settlements which include 

swift resolution of environmental problems without undermining 

deterrence: 

o Provide Incentives to Settle: EPA policy will be to 

provide specific incentives to settle, including the 

following: 

- Reducing the gravity component of the penalty 

for settlements that include expeditious 

remedies to environmental problems. 

Accepting additional environmental cleanup 

in lieu of penalties only if agreed to in 

pra-litigation settlement. 
P.65 

IV-24 

o Provide Disincentives to Litigate: The penalty 

amount which EPA pursues will continue to rise until 

the violation is corrected. The continued rise in 

penalty is systematically linked to the benefits 

accruing to the violator and to the continuing risk 

to human health and the environment. For this 

reason, this policy provides strong disincentives to 

litigating without complying. 

3. Differences Among Statutes: Each of the environmental statutes makes provision for enforcement responses to 

be taken to resolve non-compliance situations. However, the 

specific nature of the enforcement response varies from 

statute to statute. Tables IV-1&2 summarize some of the 

enforcement procedures that are specifically described in 

various environmental statutes. It is important to note 

that with the implementation of each statute, some informal 

responses are used (e.g., warning letter) which are not 

specified in the statutes. Listed below are some of the key 

ways in which the statutes differ: 

Remedies. The variation in the range and availability 

of penalties under various statutes is broad. The 

statutes also vary with respect to whether sanctions 

may be imposed only administratively or only judicially 

or both administratively and judicially. Also, there is 

variation in what EPA or courts can reguire a'source to 

do (e.g., cleanup, prevent future problems, require 

specific controls, or none of the above). 

Procedural Prerequisites. The statutes are inconsistent with respect to procedural prerequisites and 

limits to enforcement action. For example, both the 

process to issue an administrative order and the 

duration of administrative orders differ from statute 

to statute. 

Judicial Peview. The statutes differ with respect to 

the appropriate forum and time limitations for challenge to various action. 

Federal/State Relationship. The respective roles of 

the state and federal governments in responding to 

instances of non-compliance vary among statutes. 

While the specific nature of the enforcement response 

varies from statute to statute, the procedures for enforcing 

environmental laws and regulations continue to evolve. As 

noted earlier, one of the key goals of the enforcement 

program is to apply a uniform approach to choosing appropriate enforcement responses. Similar violations under 

similar circumstances should be responded to in a comparable 

manner. This is necessary to ensure fair and equitable 
P.66 

IV-2 5 

treatment of all members of the regulated community, no 

matter where they are located, and to provide certainty 

about the consequsnces of violating the law. 

Each program has developed its enforcement response 

guidance independently and, as a result, there are variations both in approach and in the degree to which they are 

adhered to by EPA regional offices. As a first step in 

developing a more cohesive approach, EPA has developed its 

uniform civil penalty policy. Each program with civil 

penalty authority will be required to.evaluate its existing 

policy against the new policy and make any necessary adjustments. Similar policies regarding selecting the appropriate 

level of action either have been or are being developed. 

Oversight of regional offices helps eliminate disparity 

among regions in treatment of similar violations. 

Since States have the lead in enforcement actions for 

most programs, consistent national policy for EPA enforcement 

responses will bring compliance programs only part of the 

way toward achieving a uniform enforcement approach. State 

laws often do not contain administrative penalty authority, 

but they may include authorities not available to EPA, such 

as authority to revoke or suspend licenses and permits— 

which could be an even more severe economic penalty. Present 

attempts, to develop an overall framework that matches the 

type of response EPA would make to a given violation with 

possible state responses which would be comparable in effect 

are discussed in Chapter V. More systematic oversight of 

state programs and attempts to articulate the circumstances 

in which EPA would intervene in a state enforcement action 

should smooth out these relationships considerably. 
P.67 

V. INSTITUTIONAL CONTEXT 

This chapter examines those institutional relationships 

that most heavily influence the success of compliance monitoring 

and enforcement programs in the U.S. The first section 

describes the very important partnership between the federal 

government and its state and local counterparts. The next 

focuses on related governmental agencies at the federal and 

state level that affect the development, implementation, and 

evaluation of compliance and enforcement programs. The third 

section identifies several institutions within the private 

sector that can have a significant impact on compliance and 

enforcement programs. Successful implementation ultimately 

depends on effective working relationships with each of these 

groups, at all levels of government and with several private 

institutions, making the task all the more complex. 

A. The Federal/State Partnership 

The decentralized federal system is fundamental to 

virtually all of EPA programs. As described in Chapters I 

and II, environmental statutes usually give the federal 

government primary authority to prescribe minimum pollution 

standards for national application. The federal EPA also 

defines what constitutes an approvable state or local program, 

consistent with criteria specified within the statute. If a 

State program meets these criteria, it is incumbant upon the 

EPA to approve that program. This section discusses how this 

very complex partnership works, how differences in state and 

federal programs, authorities and procedures for enforcement 

of environmental statutes affect how the federal government 

ensures that approved state programs are implemented in a 

fair and consistent manner nationwide, and finally, what 

recourse the federal government has to poor performance by a 

state. 

1. Extent of Delegation to States 

Whil*-the extent of delegation today varies from program 

to program?* overall approximately 70 percent of EPA's day-today responaibility to inspect and enforce compliance has been 

delegated to States. Table V-l illustrates the variety of 

delegations of regulatory authority found today under each of 

the major EPA programs. Although some programs, such as the 

Toxic Substances Control Act, are non-delegable under the 

law, even here the federal government employs contract-like 

"cooperative agreements" with States, recognizing their 

comparative advantage of being closer to the problems than 

the federal government can be. As a result nearly 85% of the 

government staff engaged in environmental regulation in the 

U.S. are employed by state and local government. 
TABLE V-l 

DELEGATION OF FEDERAL PROGRAMS 

in 

o. 

. H 

a; w 

w 

55 

« 

w 

01 

s 

* 

w 

A. 

w 

D 

O 

w 

a 

M 

s 

s 

« 

tA U P O. 

« 

ai M I 

19 

Z 

Q 

« 

z 

O 

8 

M 

8 

§ 

O 

M 

2 

O O 

« 

8 

z 

o 

to 

8 H 

l i 

M EST 

tt. 

M 

H 

£ H 

(A 

H 

O 

8 

« 

W 

C) 

o 

u M 

.-) P. 

ft 

« 

C9 

Z 

M 

•-I 

w fO 

5 

• 

M 

« 

B 

O 

a 

w 

H 

os 

o 0. 

X 

M 

* 

POTENTIAL FOR PROGRAM 

DELEGATlrJN/APPROVAL 

TO STATES 

Yes 

No 

WHAT IS CE LEGATED? 

"Enforcement of National 

Program/Standards 

"Enforcement of Acceptable 

State Program/Standards 

"only Compliance Monitoring 

ACTUAL EXTENT OF UE LEGATION 

•Number of States with Final 

or Interim Delegation 50 49 49 45 16 35 52 24 23 48 47 

aAlthough the relevant statute does not provide for state assumption of the program through delegation 

or approval, EPA does utilize cooperative agreenr*"*-^ »•<"> inpunvif^o "*"*"* --«••• L-- . 
P.69 

V-3 

Under approved state programs, States routinely monitor 

environmental quality and compliance, set inspection targets, 

develop statewide strategies, enforce against violators and 

verify the quality of monitoring and compliance data. There 

are a few cases — such as the air program — in which the 

federal government delegates directly to local governments 

but in most instances the federal government works through 

the States. 

Until a program area has been delegated to a given State, 

the federal government is responsible for all the standardsetting and enforcement functions outlined in Chapters II, 

III, and IV. This is an enormous task, and EPA works closely 

with States to build their capacity to run their own programs. 

EPA uses its grant programs to provide federal funding for 

staff and equipment. Figure V-2 illustrates the importance of 

the state role in enforcement and compliance. States perform 

the vast majority of inspections and have within their jurisdiction 

a large percentage of the major pollution sources. 

SUri MXI» SUMMNTML 

m omatuo m m 

MAIM 

omen (**« > 

2. Criteria for Delegation; Comparability of State and 

Federal Programs" 

One key issue that will strongly affect the success of 

national compliance and enforcement programs is the extent to 

which States must have comparable authority, and procedures, 

to those of the federal government. Generally, EPA delegates 

or approves state or local regulatory programs only when it 

has found that the state program meets certain minimum 

standards and criteria. The philosophy of delegation varies 

from statute to statute, but in general, state programs must 

be comparable at least in effect. 
P.70 

V-4 

The biggest difference between state and federal 

authorities in enforcement is often in the authorization for 

and ease of establishing economic fines and penalties. In 

the air, water (NPDES) and hazardous waste programs, delegations and approvals have not depended upon states having 

comparable civil penalty authority. This requirement may be 

introduced at a later date because the economic sanction has 

taken on such importance in gaining higher levels of compliance 

in the hazardous waste program. 

3. Continuing Federal Role 

After delegation, EPA never abdicates its responsibility 

to ensure compliance with and enforcement of federal statutes. 

It remains responsible in law and accountable to the Congress 

for progress toward meeting national environmental standards, 

and for ensuring that federal statutes and regulations are 

being enforced. To carry out this responsibility, EPA oversees state program implementation and takes direct enforcement 

action generally when a State fails to take timely and appropriate enforcement action. The dual role of oversight and 

direct federal enforcement can be highly sensitive as states :. 

generally believe they are doing a good job of enforcing the 

law and what constitutes an appropriate enforcement response 

has been a highly subjective determination. 

Implementing the federal/state partnership in a manner 

that makes the most productive use of the limited resources 

of each level of government and continues to achieve improvements in the effectiveness of each has been a continuing 

challenge. The federal EPA has interpreted the partnership 

differently at various times in its history, sometimes taking 

a heavy direct federal role, sometimes indicating that delegation 

should imply generally oversight, with direct federal enforcement 

only as a last resort. To stabilize this partnership, the 

U.S. EPA recently established a Steering Committee on the 

State/Federal Enforcement Relationship which was chaired by 

the author, to establish a policy framework for implementing 

state/federal enforcement programs. The results have been 

hailed as a major step forward by federal and state agencies, 

although it must be evaluated when fully implemented. The 

policy addresses both the oversight function and direct 

federal enforcement actions. Arrangements with states will 

be commemorated in state-specific enforcement agreements, to 

be updated annually, developed jointly by EPA regional offices 

and the relevant state agencies. 

a. Oversight 

EPA now has clear oversight criteria, specified in 

advance for assessing good program performance, which apply 

equally to States or EPA regional offices, whichever is 
P.71 

V-5 

responsible for administering the program. Seven oversight 

criteria apply to most of EPA's enforcement programs: 

o Clear identification of and priorities for the 

regulated community; 

o Clear and enforceable requirements; 

o Accurate and reliable compliance monitoring; 

o High or improving rates of continuing compliance; 

o Timely and appropriate enforcement response; 

o Accurate recordkeeping and reporting; and 

o Sound overall program management. 

There is a separate protocol for evaluating each EPA 

program and for the first time, EPA has defined what constitutes 

timely and appropriate enforcement response, through specific 

milestones and timeframes for state action and definition of 

circumstances under which different enforcement mechanisms 

must be used — see Chapters IV and VI. 

Working through its regional offices, the EPA identifies 

specific areas' of substandard performance at the state or 

local level, and works with the States to improve their 

program. The policy framework sets forth those remedial andfollow-up actions EPA undertakes with the States to achieve -

these improvements, such as information exchange, technical ' 

assistance, additional grant funds, two-way communications, 

etc. Most important, EPA has made a commitment to identify 

strengths and successes as well as weaknesses so that good 

good programs can be transferred from one State or region to 

the next. 

b. Direct Federal Enforcement 

EPA has now established clear criteria for when and how 

it will exercise its residual enforcement role in a manner 

which will not undermine State programs. That role is 

circumscribed in two ways. First, EPA will only consider 

taking action if one or more of the following criteria are 

met: 

o Ait^aarlier EPA order or consent decree is violated; 

o A atato requests federal action; 

o TfiaVcaoe has national significance, e.g., the noncompliance is considered to be significant, and the 

caaa comports with national or regional priorities; 

o The case would set legal precedent; 

o The case raises interstate issues; 

o There is significant environmental or public health 

damage or risk involved; 

o There is significant economic benefit gained by the 

violator; 

o The case involves a repeat violator; or 

o State authority is inadequate. 
P.72 

V-6 

Next, EPA will consider whether the State is taking 

timely and appropriate action on its own. There is a general 

presumption that a delegated State has primary responsibility 

for ensuring compliance. However, violations of a prior EPA 

order, legal precedent, or repeat violators are considered to 

warrant an independent federal action, regardless of whether 

the State is taking action. 

So as not to upset the delicate balance between immediate 

enforcement heeds and the long-term relationship with the 

States, EPA has adopted a policy of no-surprises and will 

give advance notice and consult with the States before it 

takes any action in a delegated State from inspection to 

enforcement response. Consultation should afford the agencies 

an opportunity to explore creative and constructive options 

by which the federal action can complement or improve the 

state program, rather than appear as a public rebuke for 

failure to protect the public interest. The techniques EPA 

will use include joint enforcement actions, press releases 

and a sharing of penalties, ensuring to the extent possible 

that a share goes to building the state program. 

The biggest area of conflict remains the differing state 

and federal views on the role of economic penalties in gaining 

compliance and establishing national deterrence. EPA has 

made a commitment to study how penalties are imposed in 

practice. It is one thing to espouse the philosophy of EPA's 

Uniform Civil Penalty Policy that penalties should be used to 

eliminate any economic benefit from non-compliance. However, 

it is widely known that penalty assessments are often negotiated 

to lower levels than an initial calculation would indicate. 

The Uniform penalty policy and subsequent guidance to be 

issued next year by each national program attempts to introduce 

a consistent philosophy and approach. How much discretion 

States will have in determining penalty amounts is an important 

question. At this time, in the absence of clear guidance, 

the federal government will "overflie" a state enforcement 

action if after considering all the factors in a case it 

determines a state penalty is grossly deficient. 

B. Other Government Institutions Affecting Program Development, 

Implementation and Evaluation 

At tbej&taderal level there are several governmental units 

which haffa^a significant impact on compliance and enforcement 

program deaign, implementation and evaluation. Similar institutions 

exist at the state and local levels. The principal organizations 

described below are the legislative function (the U.S. Congress); 

the executive function (the Office of Management and Budget); 

and the judicial function (the Department of Justice, the courts 

and the agency's administrative law system). 
P.73 

V-7 

1. Legislative Function; The U.S, Congress 

T 

The U.S. Congress probably has the broadest impact on program 

development. Congress, as the legislative branch of the federal 

government, passes into law the environmental statutes which 

EPA must enforce. Congress decides the environmental goals to 

be met, the type of enforcement power and discretion granted to 

EPA and the.level of flexibility with which EPA may achieve its 

environmental goals and the level of funds the agency has to work 

with. Congressional concerns for procedure to protect states 

rights and individual property rights reflect a balance between 

efficiency and these protections. The balancing has been different 

from act to act and program to program as noted in Chapter IV. 

For the most part, however, Congress has given EPA the necessary 

authorities to carry out an effective enforcement effort, and 

where they are inadequate, EPA has asked for new authority. 

Most recently, EPA asked for and received deputization of law 

enforcement authority from the U.S. Marshall Service, including 

the right to issue subpoenas, serve search warrants, make arests, 

and carry firearms. EPA has also sought streamlined administrative 

penalty authority in the Clean Water Act Amendments. EPA is 

currently conducting a review of all of its statutory enforcement 

authorities to determine where they may be' inadequate or inefficient 

In addition to actual legislative authority, the Congress 

expresses its intention for the conduct of enforcement and 

compliance programs through committee reports, floor debates, 

personal meetings and letters, and hearings requesting information. 

For example, the House Subcommittee on Oversight and Investigations 

recently expressed concern over the low level of civil litigation 

referrals. The Subcommittee requested "a detailed across-the-board 

analysis and explanation of the reasons for the low levels of 

civil litigation referrals ....[including] an updated assessment 

of what impact the current organizational structure is having in 

the enforcement program." EPA was asked to respond within ten 

days. These requests have an important influence on management 

of the program. 

Congress employs a number of budgetary controls over agency 

operations. Budgetary controls on enforcement and compliance 

can be very- specific, appearing as line items in the agency's 

budget. Pdr example, during the transition between the Ford and 

Carter Administrations, the executive office of the President 

recommendatf removal of 100 field inspectors from the water 

enforcement program. Congress responded by creating a budgetary 

line item for maintaining the inspectors. 

The General Accounting Office (GAO) is the inspection arm 

of the Congress. A GAO report will probe.the operation of an 

agency, evaluating whether the agency has successfully discharged 

its duty under the statutes and regulations. If an agency is 

found deficient, GAO will make recommendations for improvement. 

While not binding, GAO recommendations often get serious considH--
P.74 

V-8 

eration in legislative changes and Congressional oversight 

hearings. Enforcement programs have received particular scrutiny. 

GAO recently evaluated the National Pollutant Discharge Elimination 

System (NPDES) under the Clean Water Act and found that because 

selfmonitoring information by polluters was sometimes incomplete 

or absent, EPA was not as aware as it should be of compliance with 

permit requirements. Recommendations were made concerning improvements in such monitoring data. 

2. Executive Office Functiont Office of Management and Budget 

and Other Federal Agencies 

The Office of the President contains a very powerful operation 

in the Office of Management and Budget (OMB) which not only prepares 

and rules on the budget and resources of the federal government, 

but also reviews regulatory and legislative activities and clears 

all information requests emanating from federal agencies. OMB 

has a significant impact on compliance and enforcement programs 

in all three areas of involvement. 

As a budget operation, OMB historically has not favored 

federal government funding of training programs for states and 

the regulated community. As a result, these approaches to 

achieving compliance have not received as much support as this 

traditional enforcement programs of inspection and enforcement 

action. Similarly, OMB's budget decisions can have a great 

impact where the programs have come to rely upon consultants to 

supplement personnel now under strict hiring ceilings, and to 

conduct inspections in order these areas have been subject to 

budget squeezes. 

Effective compliance and enforcement depends on having 

reliable information about the parties subject to environmental 

laws and regulations. Under the Paperwork Reduction Act, the 

U.S. Congress established OMB as the central coordinator of 

federal information policy. The Act requires that any agency 

request for information from ten or more non-federal individuals 

be submitted to the OMB for prior approval. Requests must include 

a supporting statement and analysis presenting the need for the 

information, methods of ensuring the quality of the data collected, 

alternativaa to the proposed information collection and estimated 

burden hour* and cost to the public and the agency of complying 

with the rmmuest. The Act is intended to limit information 

requests omt&y to essential information needs of an agency. 

These restrictions affect EPA's enforcement and compliance 

monitoring programs in two ways. First, identification of the 

regulated community has become more difficult. EPA program 

managers need to know enough about a regulated community in the 

first instance to target their surveys, even before initial data 

requests are made. Second, self reported compliance data for 

use in targeting inspections is more difficult to justify and 

harder to collect. The tendency is to use ad hoc rather than 

standardized information requests which pose management problems 

in interpreting and managing the data. 
P.75 

V-9 

Finally, OMB clears regulatory actions and legislative 

proposals of federal agencies to ensure efficiency in government 

and adherence to Administration policy. 

3. Judicial Function: Department of Justice, the Courts and 

the Administrative Legal System 

The working relationship between the agency and the government 

attorneys who are actually empowered to bring formal actions in 

municipal, state, or federal courts is critical to the effectiveness 

of an agency enforcement program. Even after fifteen years of 

environmental regulation, sometimes state and local regulatory 

agencies cannot get enough attorney time and cooperation from 

the official city or state attorney's office - or the Department 

of Justice at the federal level — to dispose of their backlogs 

of otherwise good cases. Most of the time, such bottlenecks are 

created by uncoordinated planning and budgeting between independent 

department officials. Sometimes, the attorneys' office delays 

are an additional check and balance on environmental agencies in 

setting enforcement priorities. Recent efforts to involve DOJ 

attorneys earlier in the case development process and to share 

agency strategies have proven to be very successful in overcoming 

these difficulties. 

EPA also has a system of administrative law judges (ALJs) 

who provide an internal mechanism for enforcing administrative 

orders and appealing EPA regulatory actions. Any party believing 

itself to be the target of an improper EPA action can usually 

appeal to an ALJ for redress. The party would first discuss its 

concerns with the administering program office. If not satisfied, 

it can then file a petition with an ALJ. The judges' ruling can 

in most cases be appealed to the Administrator. 

Rulings of ALJs can have enormous impact on the enforcement 

strategy of a program. For example, Section 211 of the Clean Air 

Act prohibits introducing leaded gasoline into a vehicle designed 

to operate on unleaded fuel. Prior to 1982, violations were 

pursued through administrative proceedings as established by 

regulation. In 1982, an ALJ ruled that the regulations allowing 

administrative proceedings were invalid. Subsequently, new 

enforcement procedures were established. Notices of violation are 

issued to alleged violators, and unresolved cases are then referred 

to the Department of Justice (DOJ) for District Court action. A 

backlog of over 800 such cases currently exists. The DOJ is 

reviewing an expedited method of handling these cases as there 

are insufficient resources available to handle the current and 

continuing case load under existing procedures. 

C. Relationships With Groups Outside Federal and State Government 

Institutions participating both in the development of a 

compliance program and in its implementation include private 

organizations. Since they play a continuing role in the life of 
P.76 

V-iO 

a program, and have a continuing stake in its operation, these' 

institutions can be critical to overall program success and 

efficiency. They also offer agency managers a separate set of 

incentives and resources outside the government that dan be called 

into play to obtain better compliance leverage from a limited 

agency budget. In some cases, inattention to a key institution 

can severely limit an agency's effectiveness. 

1. Industry Associations 

Industry or trade associations generally seek to inform 

their members about applicable environmental restrictions and 

responsibilities. Groups such as the American Electronics 

Association and the American Petroleum Institute track the 

development of relevant legislation and regulation. These 

associations are important in "spreading the word" about new 

restrictions and methods of complying with those restrictions. 

For example, the American Electronics Association is 

developing a computer data base on regulatory requirements for 

use by its members. In addition, the Association publishes a 

monthly newsletter which highlights environmental developments 

relevant to the industry. The newsletter focuses on methods 

of complying with new or existing regulations. 

Associations of firms making control equipment and monitoring devices, such as the Environmental Industries Council,; 

have strong economic incentives to "spread the word." Informing 

a discharger about his control obligations and possible 

technologies for meeting those obligations is an important 

first step in making a sale. 

2. Professional and Technical Societies 

Implementation of environmental regulations to achieve 

compliance requires the advice and analysis of specialized 

technical professionals. As environmental programs have grown, 

so have the number and membership of professional affinity 

groups and associations, such as the National Association of 

Environmental Professionals, the Association of State and 

Territorial Air Pollution Program Administrators, the Natural 

Resource Section of the Pollution Program Administrators, the 

Natural Resource Section of the American Bar Association, and 

so on. Thaaa organizations can be an extremely efficient 

mechanism lor collecting or disseminating information on a 

changing regulatory program; the group has the additional 

incentives* of self-advancement and members' career advancement 

to make it work independently to keep its members in touch 

with current events. They can also be effective lobbying 

organizations where agency policy or practice runs afoul of 

members' professional or personal interests. 

Private testing and technical standards organizations also 

abound in the U.S., in large part because there are independently 

good business reasons for private industry to develop certain 

quality controls and industry standards. The American Society 

for Testing and Materials (ASTM) is a nonprofit organization 
:>77 

V-ll 

which establishes standards for testing. The ASTM publishes 

manuals outlining methods found effective for analyzing pollutants. 

Tests may determine the status of environmental parameters such 

as acidity, bacterial levels, and presence of metals. While ASTM 

is not affiliated with EPA, the Agency tends to adopt the ASTM 

standards as approved procedures for state agency and dischargers 

compliance testing. ASTM procedures, for example, are included 

or the List of Approved Test Procedures in the Clean Water NPDES 

regulations. 

3. Insurance Companies 

Careless use or even the mere sale of highly toxic or 

hazardous substances can make manufacturers liable for injuries 

and property damage caused by the substances, quite apart from 

EPA regulatory enforcement. Private plaintiffs are beginning to 

file more lawsuits claiming such environmentally related damage. 

Specific provisions in RCRA and CERCLA require hazardous waste 

dumps to obtain postclosure insurance to avoid the problem of 

"orphan dumps." Therefore insurance companies have a real market 

and a potential opportunity to: 1) helping clients identify for 

the regulated community and "spreading the word" regarding hazardous 

waste regulations, and 2) assist in compliance by scrutinizing 

operations for safe practices before issuing a policy. 

Unfortunately, insurance company potential has not yet been 

realized. First, risk spreading by insurance companies decreases 

their incentive to seek cost savings through advice to clients on 

risk reduction and improved compliance practices. Further, three 

years ago EPA began to consider encouraging the insurance industry 

to do private inspections. The insurance industry's reaction at 

the time was that inspections were a federal responsibility and 

should remain so. The potential for better government cooperation 

with this existing industry institution remains large nonetheless. 

4. Public Interest Groups 

Environmental and other public interest groups vigorously 

track the implementation of environmental programs by EPA and 

other agencies. All environmental monitoring data collected by 

agencies is available for public inspection. Some groups, such 

as the Sierra Club and Natural Resources Defense Council, have 

systematically reviewed monitoring reports and filed citizens 

suits agaiaat a large number of sources in violation of their 

discharge permits. Within the last twelve months 30-40 citizen 

suits have been filed and over 200 notices issued by them under 

the Clean Water Act. 

Citizen suits are most commonly brought against individual 

dischargers believed to be in violation. Suits brought against 

EPA for generally not enforcing a program are less common and 

tend to be resolved in favor of the Agency. The overall structure 

and priorities in an agency enforcement program are viewed as 

discretionary, and courts are reluctant to force FPA to take 

action to restructure entire enforcement offices. 
P.78 

V-12 

Section 304 of the Clean Air Act of 1970 was the first 

provision expressly empowering citizens to act as private 

attorneys general to enforce a federal statute. Each federal 

environmental enactment since 1970, except FIFRA, has included a 

citizen suit provision and each provision has been modeled on 

Section 304. 

Citizen suits do not always supplement agency action, to 

the extent that they redirect federal resources away from priority 

cases, they can be a resource drain. This is being carefully 

monitored. 
P.79 

VI-1 

VI. EVALUATION OF EFFICIENCY AND EFFECTIVENESS 

Over the years, U.S. EPA and the public have used various 

criteria to evaluate the effectiveness of national enforcement 

and compliance monitoring programs. This section describes 

trends and conclusions that can be drawn regarding the design 

and implementation of current programs. The section is 

divided into a discussion of: (a) current measures of success, 

those which are actively used to manage and evaluate the 

U.S. compliance monitoring and enforcement programs, and 

(b) General Oversight Criteria in current or planned future 

use. 

A. Current Measures of Success Used in U.S. Programs 

The U.S. EPA has established four types of measures to 

ensure national programs are achieving their desired goals: 

o the rate of compliance with permit, regulatory and 

statutory requirements; 

o progress in returning significant violators into 

compliance; 

o the extent of compliance monitoring: number of 

inspections made; and 

o the number of administrative and judicial enforcement 

actions taken. 

The first two of these measures are used to assess program 

results. Both compliance rates and progress in returning 

significant violators to compliance reflect how well our programs 

are achieving the ultimate program objectives of high and 

continuing rates of compliance. The next two activity measures 

provide assurances that there are healthy levels of enforcement 

activity to create the necessary deterrence to non-compliance 

and to justify reported rates of compliance. 

The chart on the next page (Figure VI-1) provides a 

sample of how these measures are displayed in practice. A 

national system called the Strategic Planning and Management 

System provides the framework within which formal commitments 

for good performance are negotiated with EPA Regions and 

States baaad upon past performance, program statistics and 

funding levels. Progress is reported each guarter. 

Each of the four key measures is discussed below in more 

detail: 

1. Compliance Pates: 

The rate of compliance should be ore of the best overall 

measures of program success. High rates of real and continuing 

compliance are the ultimate goals of U.S. compliance and 
P.80 

Vl-<! 

FIGURE VI-1 

A. MANAGEMENT ACCOUNTABILITY SYSTEM 

• • • MANAGE ANO TRACKING A MIXTURE.<* «« ULV S ^ ACTMT y ^ 

FOUR AREAS: 

e CCMPUANCI MOMfTORlNQ 

e COMfUANCf RATtt 

e SIGNIFICANT VK>UTK>NS 

e INPOftCfMINT RISPONtf 

SAMMI ONLT« -©ATA AM NOT RI U 

FOCUS: 

INSPECTIONS: 

•V MCiON 

COMPUANCI: 

SIONIPICANT VIOLATORS 

8" 

M SCHIO 

laUV VWl l Q FY M VIOL'S 

S CIVIL • CRIMINAL 
P.81 

VI-3 

enforcement programs. Nevertheless, the rate of compliance 

has several significant shortcomings as a single measure of 

success. Because of these shortcomings, the V.S, program 

does not have the full confidence we would like in compliance 

statistics, although the U.S. EPA does use compliance rates 

to identify- specific areas requiring management attention. 

These shortcomings are: 

First, compliance rates are only as good as the statistical 

adequacy and reliability of the compliance monitoring 

data used in the calculation. This is particularly 

troublesome in the air program which relies heavily on 

infrequent inspections to provide a single data point 

on compliance. Because programs usually assume compliance 

for those sources for which a violation has not been 

detected, the results of an announced annual inspection 

may be used to assume year round compliance. At issue 

is whether the compliance rate should reflect violations 

detected for the total universe of regulated sources or 

just those sources for which sound data are available 

i.e., which were inspected or for which self-surveillance 

data is received. 

Second, even a high rate of compliance does not necessarily 

indicate success from an environmental standpoint, particularly if the small number of violators contribute the 

most significant adverse impact to the environment. 

Similarly, low rates of compliance should not necessarily 

be interpreted as a program failure if the low rates 

are the result of improved methods of detecting violations, 

the application of more stringent standards for defining 

compliance or the introduction of new requirements. 

Third, the U.S. program continues to confront definitional 

problems in what constitutes compliance. Senior management 

at EPA has set forth a policy that compliance should be 

defined as the ultimate achievement of environmental 

standards. Some of our programs, the NPDES water discharge 

permit program in particular, had been defining a source 

as being in compliance if it either was achieving environmental standards or was meeting a schedule for compliance 

set forth in an enforcement order or agreement. This 

practice has now stopped and the two compliance rates 

are reported separately. Compliance with actual standards 

muat^ba used as the truest measure of how well the benefits 

anticipated by the regulation or standard are being realized. 

Compliance with an enforcement agreement can, however, be 

used to assess how seriously such agreements are followed 

and how well they are negotiated. 

Further definitional problems can be and have been encountered. 

For example, is the program reporting rates of compliance 

with any and all violations, no matter how minor, or is 

the program reporting rates of significant violations? How 

should the program treat continuing patterns of violations? 
P.82 

VI- 4 

For example, how should sources be reported which a^re in 

compliance during the reporting period but which regularly 

are found to go in and out of compliance? 

Summarized below are data and trends in compliance 

rates. Actual trends can only be presented for the air and 

water environmental programs. The hazardous waste program 

is too new to reflect trends of non-compliance. In the 

toxics and pesticides programs, compliance rates usually 

cannot be reported as data do not exist on the total universe 

of regulated sources. 

a. Air Compliance Trends 

As can be seen in Figure VI-2, the earliest records 

show that in 1974, only 59% of a universe of 17,732 sources 

regulated under the State Implementation Plans (SIPs) were 

in compliance or meeting schedules. Progress, as reflected 

in decreased violation rates, was most dramatic in the early 

years cf the program and less marked thereafter. 

Over the last five years, from 1979 to the present, the 

rates have hovered over 90* for Class A-l SIP sources, that 

is, sources whose actual or potential emissions exceed 100 

tons per year. The rates are slightly better for new sources ; 

and hazardous air emissions: from 95.5-97.1* for NSPS and 

97.7 - 98.7* for NESHAPS. 

Air Compliance Rate* 

'»'0 though 1984 

•M • • -

70 71 

I I I I 

7 8 7 3 7 * 79 7« 77 

Fiscal T«ar 

I'l l l i i 

78 7» 80 81 83 83 8* 

"excludes NESHAPS 

These data seem to suggest that enormous progress has been 

made in achieving compliance with the Clean Air Act and that a 

plateau has been reached with some percentage of sources being 

in violation at any point in time. However, this does not 
P.83 

VI- 5 

tell the whole story. A recent breakdown of compliance 

rates as of the end of FY 1983 shows that the percentage of 

sources of unknown status is almost equal to or exceeds 

those known to be in violation. 

TABLE VI-1 

Total 

1983 

Category 

Class A SIP 

Class Al SIP 

NSPS 

NESHAP 

26,582 

14,405 

2,069 

1,265 

In Compliance 

24,385 (91.7*) 

12,807 (88.9*) 

1,929 (93.2*) 

1,186 (93.8*) 

Mtg. Sch. 

502 (1.9*) 

400 (2.8%) 

17 (0.8*) 

10 (0.8%) 

In Viol. 

796 (3.0%) 

609 (4.2%) 

79 (3.8*) 

17 (1.3%) 

Unknown 

699 (3.4%) 

589 (4.1%) 

44 (2.1%) 

52 (4.1%) 

In the late 1970's management at EPA believed that the 

numbers were suspiciously high given that the economics 

showed that it paid polluters to install but not operate and 

maintain the pollution control equipment. Annual operation 

and maintenance (O&M) costs often equal or exceed annualized 

capital costs. 

A major series of studies conducted over a two year period 

revealed that while the vast majority of sources had installed 

air pollution controls, continuing operating upsets and O&M 

problems could be contributing excess emissions of up to 25% above 

standards, 67* of which were preventable. 71% of the sources 

studied had documented excess emissions, on the average of 13 

incidents a year, lasting 64 hours each. 30% of these problems 

were attributed to design inadequacies, e.g., missizing of 

flue gas desulphurization equipment, 37% to failure to maintain 

equipment such as changing bags for a baghouse, etc. As a 

result of these studies a new strategy has been adopted to 

specifically address continuing compliance problems, including 

improved inspection techniques, enhanced use of data from 

continuous emissions monitoring, and analysis of malfunction 

reporting to identify sources with patterns that seem outside 

the norm and preventable. 

Thua, while we cannot expect continuous improvement in 

compliance) levels, these high compliance rates have not been 

viewed by EPA as indicative of success. Indeed the likely 

consequences of newly-subject Volatile organic Compound 

(VOC) sources and better data on continuous compliance, are 

an increase in violation rates. 

b. Water Compliance Trends; 

(1) NPDES: Water Discharge Permit Program: 

Any analysis of compliance rate trends for the NPDES 

Program must consider three caveats. First, up to the present, 
P.84 

VI-6 

the compliance rates have reflected only those sources which are 

not "significant violators." "Significant Violations" in'the 

NPDES Program are defined as: 

Facilities violating requirements of previous enforcement 

actions and compliance schedules are generally considered 

significant. Also, facilities in violation of permit 

effluent limits are considered to be in significant 

non-compliance for: 

- single events and short-term limits that have 

potential to cause adverse environmental or 

health impacts. 

- violations of monthly average permit limits, for 

any two months in a six-month period that exceed 

the limit for nontoxic pollutants by 40% or 

exceed the limit for toxic pollutants by 20%. 

- violations of monthly average limits for any 

four months in a six-month period. 

Second, until quite recently, the program reported 

as in compliance those facilities which were on construction 

schedules, thus, full compliance with effluent standards 

was not reflected. 

Third, the rates are reported only for the major sources, 

that is, the worst 15% of the national inventory of water 

dischargers. 

Keeping this in mind, what is most noteworthy from Figure 

VI-3 is the differential rate of compliance between industrial 

and municipal dischargers and the length of time it has 

taken for sources to actually achieve compliance with the 

requirements of the statute. 

Wot«r Compliance Rat« (NPDES) 

l£____0 

• Major Industrial Dischargers- Compliance with schedules 

• Major Industrial Dischargers- Compliance with effluent limit* 

• Major Municipal Dischargers- Compliance with schedules 

__ Major Municipal Dischargers- Compliance with effluent limits 
P.85 

VI-7 

Municipal non-compliance has been identified as a problem 

and targeted as a high priority for the program for som^r 

time. In the late 1970's at the same time the evaluation 

studies were performed on continuous compliance with air 

standards, studies also were conducted of the water program. 

Fully 77% of the major secondary treatment publicly owned 

treatment works (POTW's) — plants of over 1 million gallons 

per day — experienced non-compliance to some degree, 53% had 

violations which were considered serious (defined as 1 violation 

of 150% or more over standards; or 6 violations of 80% or more 

over standards) or significant (defined as 3 violations of 

50% or more over standards; or 12 violations of 20% or more 

over standards). 

There was an unwillingness at all levels of government 

to take enforcement action against municipal governments. 

The program suffered from two inconsistent federal roles: a 

regulatory/enforcement role and a grants role under which 

the federal government shared the cost of building the treatment 

plants. 

The reasons found for such high levels of non-compliance 

were that (1) municipalities were not at risk of legal or 

economic sanction, and (2) POTW staff lacked the necessary 

operational skills either to make the treatment plants 

work to the levels they were designed to meet or to ensure they 

were designed properly to meet current needs. 

Training and technical assistance provided to operators 

had not been targeted to meet the needs of plants experiencing 

operational problems. Studies also indicated that technical 

assistance or training without enforcement did not bring 

non-complying plants into continuing compliance. 

Several steps were taken over a four year period to address 

these problems. First, the U.S. EPA issued diagnostic guidance 

on common malfunction problems. Next the agency devised a 

composite correction program for trouble-shooting at poorly 

performing plants. Finally, the agency devised a forceful 

enforcement strategy that calls for federal and state enforcement 

against municipal plants whether or not they are scheduled 

for federal funding. 

The federal government's first priority will be to 

enforce standards against plants already constructed with 

federal dollars. Next the agency will tie compliance schedules 

to plants scheduled to receive federal grants to upgrade 

municipal treatment works. Finally, even if a municipality 

needs and is not scheduled to receive federal funds, it will 

be subject to enforcement action. This removes the disincentives 

for municipalities to properly operate and maintain facilities 

once the federally subsidized construction phase is completed, 

and removes inadequate resolve at all levels of government 

to take forceful legal action against municipalities for 
P.86 

VI-8 

failure to operate and maintain treatment works at acceptable 

levels of effluent discharge. 

(2) Compliance With Drinking Water Standards 

Current .compliance data for fiscal year 1980-1983 indicate 

that compliance with the microbiological and turbidity maximum 

contaminant level (MCL) and M/R requirements have generally 

improved each year. However, approximately 29% and 10.5% of 

the Public Water Systems (PWS's) are not in compliance with 

the microbiological and turbidity standards, respectively 

8.8% and 6.1% of the PWS's systems are classified as persistent 

microbiological and turbidity violators. 

Because the Public Water System Program is a mature 

program, many of the systems which remain out of compliance 

?re either recalcitrant or lack the knowledge or ability to 

comply. To ensure that these systems are targeted for compliance 

requires a systematic approach combining programmatic and 

enforcement actions. 

As the U.S-. EPA has analyzed the compliance rates of various 

segments of the public water systems over the years, it has 

found that rates of compliance vary depending upon system size, 

and type of system (community vs. non-community). To address, 

these specific problems, in 1979 EPA issued a strategy which 

suggested that regions and states establish follow-uo and 

enforcement priorities using such factors as the population at 

risk, the type of contaminant level exceeded, the source of 

the water supply, the degree of treatment, and the type of 

facility served (hospital, food establishment, rest area, etc.). 

Continuing analysis of community compliance data revealed that 

non-compliance was disproportionately concentrated in the small 

and very small water systems (systems serving less than 3,300 

persons). In response to this data, the Office of Drinking 

Water proposed a small systems strategy in June 1980 and has 

encouraged States to use the state compliance strategy technique 

to rank follow-up and enforcement actions when addressing 

instances of non-compliance. In 1984, these strategies were 

combined to an overall compliance policy for addressing compliance 

problems in a regulated water system. 
P.87 

VI-9 

VI-2 

tuaioa or SYSTM IN VTOUITCN WITH me 

tf CXSIOUBICM. AND TURBIDITr STMSMDS 

rr mi-iM3 

• National Total Persistant violators U Intatsrfttent Violators I* 

main—m rt so rt n rr 12 n a rt so n si rt n rf»3 rt to rt n rt n rt IT 

Micmninloglral 

MOll 11.0 I.S t.t 10.0 1.0 .» 1.1 1.4 10.0 7.6 1.6 1.6 

*/*[« 30.1 14.C 24.4 2X4 U.4 0.1 7.« (.( 17.7 lt.J It.I lt.t 

34V.7 H.S 10.1 29.) 14.2 10.0 ».l I.I 22.4 l».l 20.3 ». i 

TurMdlty 

TOW, 

2.1 

(.1 

9.S 

1.1 

S.3 

7.0 

1.4 

10.2 

11.4 

1.1 

S.O 

4.1 

3.1 

S.O 

/.3 

j . l 

4.9 

4.9 

2.2 

3 . ! 

4,7 

1.9 

3.1 

4.4 

4.6 4.9 3.4 3.0 

11.1 10.2 13.7 1.1 

16.1 11.9 16.3 10.5 

J l senistenti in a fiscal y«ar—> 3 montta at i. quarter ir violation 

J2 Iittesalttent: In a fiscal year—£ 3 sontfts ot 1 quarter in violation 

J2 MO.i Maximal Gantasinam Level 

]f ft/Hi Monitoring and assorting 

c. Hazardous and Toxic Substances 

For most of the programs controlling hazardous waste 

disposal and toxic substances, the programs are either too new 

or data insufficient to provide compliance rates or trends. In 

the hazardous waste program, compliance rates have been quoted 

as low as 20% by recent studies undertaken by the General 

Accounting Office. All that can be said at this time is that 

the compliance rates are unacceptably low mainly due to the 

newness and complexity of the program, and the absence of a 

concerted enforcement effort. The hazardous waste enforcement 

program got underway during a period in the Agency's history 

when the emphasis on partnership with the states was interpreted 

as deferring to the states. Moreover, federal staff concentrated 

on Superfund activities to the neglect of a strong effort to 

enforce interim status regulations under the hazardous waste 

program. Attempts are (currently) being made to remedy this 

situation and to achieve higher rates of compliance. 

Becausa there is no fixed universe of regulated entities 

in most of the toxics and pesticides programs, compliance rates 

cannot be calculated. The exception is the asbestos in schools 

program for which a low compliance rate of 60% has been reported. 

The enforcement strategy to date has been to publicize the 

presence of asbestos. In response to the low rates of 

compliance, this strategy has been revisited to introduce 

more stringent enforcement responses and to consider requirements 

for public disclosure of plans for corrective action. 
P.88 

VI-10 

2. Progress in Returning Significant Violators to Compliance. 

One of the U.S. EPA's most successful management tools and 

measures of program success has been the establishment of a 

list of significant violators for which EPA and state officials 

are charged with taking effective enforcement action, sufficient 

to achieve compliance. This approach was used in the "Major 

Source Enforcement Effort" initiated in the fall of 1977 and 

extended until the spring of 1981. During that 3 1/2 year 

period it was the driving force to bring large industrial 

sources into compliance with air and water regulations, its 

focus was on the installation of the required air and water 

pollution control equipment for initial compliance. That 

effort resulted in actions against specific large industries 

of concern such as steel mills, power plants, refineries, 

pulp mills, chemical plants, etc. 

The more recently instituted significant violators lists 

do not single out particular industries. Rather, the lists 

are derived from the application of clearly defined national 

criteria. They reflect several other improvements over 

past management systems. First, the sources are tracked until 

full compliance is achieved. Previously it was considered a 

success if a formal enforcement action was taken. Second, the 

list is continually updated. EPA tracks both the beginning-ofyear backlog of significant violators not yet brought into 

compliance, as well as new significant violators as they are 

found. This provides both a static and dynamic picture of how 

we are doing. Earlier, when the major source list was exhausted, 

EPA enforcement seemed to decline rapidly. Today, however, 

the significant non-complier lists are a continuing management 

tool. 

EPA keeps a quarterly tally of those violators for which 

a formal enforcement action was taken, those which were 

brought into compliance, or those which remain, pending 

enforcement action. Targets are ambitious, so that by the 

end of the year EPA and the States are committed to reducing 

the backlog of significant violations to nearly zero. As 

illustrated in Figure VI-4, at mid-year EPA and States were 

on track to meet this end-of-year commitment. Equally as 

important, figure VI-5 shows how EPA will continue to 

address that aost significant violations as they arise. 

The focua on a given list, updated each year, has several 

advantagaar (a) enforcement responses are associated with 

results; (b) it permits easy verification of progress in 

resolving instances of non-compliance; (c) the criteria for 

what constitutes a significant violation directs enforcement 

to those actions which would yield the greatest environmental 

benefit; and (d) the lists enable national program managers 

to examine patterns of compliance problems across media, 
P.89 

VI-11 

FIGURE IV 

WE ARE ESTABLISHING AND MEETING COMMITMENTS 

TO CORRECT SIGNIFICANT VIOUTIONS IN: 

WATW 

twuewr UNITS 

WATW INNOMl 

WITH FINAL 

tmUCNT UMITS 

Industrial 

•INOINO TAnorr 

LEGENO 

Municipal 

INFOicfMt'Nf ACTION TARIN 

S I *tNOINO 

•tNOM O 

TARGET 

•or i * i 

QUARTtftS 

LEGEND 

HftURNfO TO COMNIIANCC 

CNNOftCf " 

NfNOtNO 

8 9 (NSOftCf MINT ACTlOU TAKIN 

MA2WOOu« WA8TI WOUI TOBCSfTfCAl 

1 t s 

OUANTIftS 

LEGEND 

g

HtTUNNIO TO COMniANCI 

ON ACCINTASLf SCMCOUUS 

SUBJf CT TO tNNONCt**INT ACTON 

•tNOMO . 

I * I 

ouAjtrtfts 

LEGEND 

Q MTURNIO TO COMSUANCI 

• B l SUflJKT TO SNPOMCiMtNT ACTION 

e m stNOMO 

N Y 1 I 

ouAirrtm 

LEGEND 

C * MfTUNNIO TO COMNUANCf 

SsS NfNOtNO 

ACTUAL DATA AS Of i i . 

• M M omr JAJAMNV urn ntmtun 

]/ •neteunmntrnomKtmtm 

WATId 

it _ , _ _ 

TNR) MONTMO NS A fQI I 

I A M VMXATfO ANJV 

2) NSJWSTT USNTATIQNS SON T9NJ lAMJ NaNSHWIW 

A M IXC f 1M B tr AN * AMOUNT ANY NOUN MONTMI 

IN A t»* ISONTN FfNIOO: ON 

JJ COMStlANCt KMffOU U OATSJ AMI MfSJfO I T SO OAVI 

ONMONI 

3t &AJON MANOLIM WITH CLASS I VIOLATIONS A M 

NCSA TMI NCNA (OUIVALINT Of SIGNIFICANT NON-COMOLIINS. 

CLASS I V.OLATIONS A M THOSI WHICH FOSI OlMSCT ANO 

IISMIOIATt HAMM ON TMMATS ON HAMM TO 'VSLIC MIALTM 

ON TMI INVIftONMINT. 

, FOR A TARGETED UST OF NAMED FACILITIES AND VIOLATIONS 

tl A VIOLATION ON A HUMANS fTANOAMO UNLISS TMI MAONlTUOl 

ANO DURATION ON TMI VIOLATION AMI MINNMAL ANO TMI 

VIOLATION NONWICUNN1—3; ON 

2J A VIOLATION ON IMWSOUNCl^sNUNniNOMIOL^lNNNTl ANO 

NN* I MOumnsiNTa . UMLO I TNN. MAONITUO I AN D OUMATIO N 

ON TM I VIOLATION A M MWMAL; ON 

» A VIOLATION ON A ST AT I NSFLIMINTATION NLAM (SINI IN 

TMI SOUMC* H ON tUNNICtfNT SIX! INMSUMNTIVILVI ISO. _ 

TONS/VIAM FOTINTIAL IMtSSIONSO* 100 TONSTYIAM ACTUAL 

IMHSIONS ON ANT NOLLUTANTS ANO IS SO LOCATtO AS TO 

IMNACT A NONATTAINMINT AM A FON A FOLLUTANT »ON WHICH 

TMI SOUMCI It IN VIOLATION. 

V . . _. . 

TOXICS II CIVIL AOMINtfTMATIVI ACTONS. 

21 CIVIL NtFWNA U TO OOJ 

J| CRIMINAL I f FtMNAL* TO OGJ 

«l NOTICU OF NONCOMNLIAMei ON AUIfTOSJN4CMOOLS 
FIGURE VI-5 

PROGRESS IN RETURNING AIR VIOUTORS TO COMPUANCE 

As Of March 31,1984 

FIGURE 2 

REDUCTION OF SIGNIFICANT VIOLATORS 

PENDING AS OF OCTOBER 1.1983 

J50n 

3 

BOY 1 . 2 3 

QUARTERS 

LEGEND 

f~~l rniwiMn re cosifUANcc 

{&_ ONAcariAsuscMfoutrt 

fc23 SUSJtCI TO INrOICIMIHI ACTION 

• • ffNDINt ACTION 

ENFORCEMENT ACTIVITY THROUGH 

SECOND QUARTER 

soo 

400 

300 

^rAftCCT 

200 

V '/ 4 * 

•tnauors SOURCES ON ACCCPTABU SCHEDUXS 

V 

eo 

o 
P.91 j 

Vl-13 

industries and companies. The very existence of the significant 

violator lists, which at this writing are publicly available 

upon request, also may provide an incentive to the listed 

sources to correct their violations. (Note that the "Major 

Source Enforcement Effort" lists were not released to the 

public.) 

Summarized below is past experience in the water and 

air programs with the use of targeted lists. 

Water: NPDES 

With the passage of the original July 1, 1977 statutory 

deadline for construction of required treatment facilities, 

the Agency began a concentrated drive to identify and bring 

enforcement actions against all major permittees that had 

violated the statutory deadline. One objective of this 

effort was to seek penalties that removed the economic advantage 

of delayed compliance and would deter future violations. 

During the 3 1/2 year period it was in effect, the Major 

Source Enforcement Effort (NSEE) was the driving force of 

the water enforcement program. 

The identified universe of non-complying permittees was A 

relatively high in 1977: 21% of the major industrial sources, 

and 47% of the major POTWs. Also, the sources in violation 

in late 1977 represented large industries — steel mills, 

power plants, refineries, pulp mills, chemical plants, etc., 

— that accounted for a far larger portion of the water pollution 

problem than their numbers indicated. The credibility of 

EPA's and the States' enforcement programs depended on 

demonstrating that even these large and recalcitrant sources 

must obey the law. 

The MSEE resulted in a significant enforcement success 

by May 1979. Of the 609 sources targeted for civil actions 

and 5 designated for criminal actions, EPA took 515 of the 

actions and States took 99 actions. Even more significant 

than the number of actions taken were the settlements and/or 

trial judgments that resolved important technological issues 

with the steel, electric power, and pulp and paper industries, 

leading to significant environmental improvements. 

The recently instituted tracking of significant violator 

lists is beginning to yield similarly impressive results. 

See Figures VI-4. 

Air: 

The Major Source Enforcement Effort (MSEE) addressed 

aoproximately 1,670 air sources. As part of this program, 

EPA's Regional Offices initiated judicial referrals for 

approximately 400 air cases (not all of which were filed). 
P.92 

VI-14 

Many other sources came into compliance as a result of EPA 

administrative action, state judicial or administrative

 r 

action, or without any such action. Major characteristics 

of the Major Source Enforcement Effort were the predominant 

Federal role and the heavy reliance on litigation. At the 

conclusion of-this effort, it was considered that the "initial 

compliance" problem for particulates and sulfur dioxide 

sources was generally under control. 

After the conclusion of the major source enforcement 

effort, the focus of the program broadened to include a 

re-emphasis on other elements of the program which were 

relatively ignored during the major source enforcement 

period (for example, new source permit requirements). In 

addition, compliance dates for sources of volatile organic 

compounds, often first regulated in SIPs in 1977, began to 

pass, creating an additional group of violators which needed 

to be addressed. To help set priorities for federal actions 

against violating sources, the concept of a "significant 

violator" was developed as part of the Agency's Management 

Accountability System in the fall of 1981. 

A significant violator was defined in December 1981 as a _. 

source meeting any of the following criteria: 

(1) a violator of a hazardous air emission (MFSHA»s) 

standard unless the magnitude and duration of the 

violation are minimal and the violation nonrecurring; 

(2) a violator of new source permit requirements and 

standards, unless the magnitude and duration of the 

violation are minimal; 

(3) a violator of a State Implementation Plan if the 

source is of sufficient size (presumptively 250 

tons/year potential emissions or 100 tons/year 

actual emissions of any pollutant) and is so located 

as to impact a nonattainment area for a pollutant 

for which the source is in violation. 

A combined federal-state effort to address significant 

violators *»•* inititated in early 1982. This has been 

different fcsjatthe Major source enforcement effort in two 

important wags}. Pirst, as previously noted, while the major 

source effove was also a joint federal/state effort, it was 

heavily dominated by EPA. In contrast, in implementing the 

significant violator program, EPA has placed considerably 

greater reliance on the States for enforcement against sources 

within their jurisdictions. To make assumption by States of 

this increased responsibility more feasible, EPA has greatly 

expanded its support to the States through direct technical 

assistance and state program capacity building initiatives 

(e.g., workshops and technical manuals). The second fundamental 
P.93 

VI-15 

change was to reduce confrontation between EPA and industry 

through pursuing negotiation and informal or administrative 

resolutions, with litigation perceived only as a last resort. 

(The combination of these factors, combined with others such 

as Agency reorganizations and resource cuts, resulted in a 

temporary reduction in the Agency's enforcement profile as 

described in section 4 below.) 

In the first 27 months of the significant violator 

program, considerable progress has been made. An initial 

list of 482 sources was established and, since then, an 

additional 520 sources have been identified. In this same 

period, 602 sources (representing the vast majority of the 

original list) have been brought into compliance or placed on 

an acceptable compliance schedule. 

3. Compliance Monitoring: Inspection Levels 

A third measure of success for our compliance and enforcement 

programs is how well they monitor compliance and create an 

•enforcement presence" within the regulated community. The 

U.S. EPA management system sets commitments for and reports 

progress on the number of state and federal inspections. 

There is significant congressional and environmental group 

interest in this number. How well we do and whether the 

choices we make for compliance monitoring are cost-effective 

has already been discussed in Chapter III. There are, however, 

two points to note here. 

First, this measure credits the program only for 

inspections, leaving out source self-surveillance or third 

party certification. It therefore fails to portray the full 

array of monitoring data available to program officials. 

This may not be a serious problem, however, since inspections 

are still relied upon and valued by the public for their 

independent verification of compliance status. 

The second item to note is that the number of inspections 

gives no information as to the quality of the inspections nor 

the appropriateness of the targets of inspection. The U.S. 

programs at both the Headquarters and Regional level attempt 

to make supplemental evaluations to address these two concerns. 

One approach is to evaluate the inspection strategy that is 

used to target inspections to determine the extent to which 

it is consistent with national criteria and norms for inspection 

frequency described in Chapter III. Another is the use of 

oversight inspections to assess the quality of the inspections. 

Oversight inspections are conducted either by EPA officials 

or consultants and are conducted either s-eparately or simultaneously, with state and regional personnel. Sample inspection 

report files are also reviewed. 

In the past, inspections and inspection strategies hav? 

not been given the full emphasis they deserve in the U.S. 

programs. Training has been available and oversight inspector 
P.94 

VI-16 

are used to identify problems. However, strategies for 

targeting inspections will be given greater emphasis 'in the 

future and will be one of the concerns of the new office ofEnforcement and Compliance Monitoring at the U.S. EPA. 

Certainly, it is one of the ironies of assessing program 

performance,.that improved targeting of inspections to better 

detect violations will undoubtedly yield lower rates of 

compliance,, at least in the short term. It is therefore 

essential that all of these measures of program effectiveness 

be reviewed in their entirety. 

4. Enforcement Responses: The Number of Administrative and 

Judicial Enforcement Actions 

Based upon the level of media attention and public inquiry, 

the most important single indicator of enforcement program 

effectiveness to both Congress and the public is the level 

of civil or criminal case referrals at the federal level 

(from U.S. EPA to the Department of Justice). Managers 

within EPA and the public keep a close watch on the levels 

of case referrals and filed court cases. This is because 

litigation is the ultimate weapon in the arsenal of enforcement 

tools. Its use is viewed as an indication of the willingness 

of national environmental program managers to take any and -

all action to gain compliance. 

This is not to say that litigation is the best or most 

appropriate indicator of success in the program. Indeed, 

reliance on the number of case referrals as a measure of 

performance has the following limitations: (a) enforcement 

responses can fail to achieve timely and effective compliance 

at future dates, (the mere initiation of an enforcement 

action is no guarantee of success and it can lead to delay 

and lengthy compliance schedules); (b) litigation is the most 

costly enforcement response, it is resource intensive and ti'.ie 

consuming, resulting in long delays before compliance is achieved? 

and (c) the program's success depends on the use of the full 

range of enforcement responses, not just litigation points 

which are often lost in the focus on numbers of court actions. 

At one brief point in the Agency's history, in the early 

1980s, Agstncy management decided to ignore levels of enforcement 

activity and to focus on compliance rates as the only appropriate 

indicator of success, regardless, whether achieved through 

jaw-boning, technical assistance, a formal administrative 

order, litigation, or penalty. This did not last very long 

following public inquiry and outcry over lower levels of 

enforcement actions. While it is true that the U.S. EPA has 

been trying to shift public attention from its preoccupation 

with court cases to results-based performance measures, 

i.e., on measuring overall compliance rates and progress 

against a set of significant violators, there is still a 

general recognition of the importance of using numbers of 

both case referrals and administrative actions to manage ani 
P.95 

VI-17 

evaluate the program. There is far too much imprecision in 

our measurement of compliance rates, and far too much Import 

to the continued, predictable presence of a visible enforcement 

effort to ignore the importance of levels of enforcement 

activity. Nevertheless, it will always prove difficult to 

say how much enforcement activity is enough, in the absence 

of other measures to place these numbers in a fuller context. 

The numbers of enforcement actions are available for 

the federal EPA only. Starting in October of 1984, they win 

be available on a consistent basis for state actions as well. 

Comparison from one year to the next is difficult due to 

changing definitions of what is counted and included in the 

total. As can be seen in Figures VI-6 and vr-7, the numbers 

of enforcement actions have proven to be far more sensitive 

to agency policy and management systems changes than are 

rates of compliance. One can see dramatic increases in 

the period from 1977 to 1979 in the levels of enforcement 

action in response to the Major Source Enforcement Efforts 

in air and water, followed by a dramatic decline when the 

lists were whittled down. One can also see a dramatic decline 

in the levels of federal enforcement action with the change 

in organization in 1980. The Enforcement divisions were 

separated into technical and legal staffs, with the technical 

staffs decentralized and integrated into program operations 

staffs. Then there is a dramatic increase again with the 

institution of new management systems under the Ruckelshaus 

administration, and the push to assure a credible enforcement 

effort. The agency responded to low lavels of enforcement 

activity from October to December 1983 by instituting monthly 

reporting, and increased management tracking of enforcement 

projections which resulted in a tripling of case referrals 

and a doubling of administrative actions during the second 

three month period, over the first three month period. 

These changing levels of enforcement action relate not 

only to management initiatives but also to changing realities 

in the maturing of old programs and the initiation of newer 

programs. The air and water (NPDES) programs have had to 

shift from a more straightforward focus on initial compliance 

and installation of control equipment, to the more difficult 

and less obvious task of ensuring continuing compliance on a 

day to day basis. The numbers of enforcement actions have 

dropped partly as a result of the need to shift focus and 

the increasing difficulty of developing cases. In contrast, 

the hazardous waste program is experiencing the same low 

levels of compliance that seemed in evidence at the beginning 

of the other programs. However, public impatience and concern 

is far greater and finally, the regulated sources of pollution 

are getting smaller and more numerous making the task all 

the more difficult, and the investment in enforcement action 

more costly. 
I 

300 -p 

180-1 

260 • 

2*0 -

220-

200 

ISO 

ISO; 

140-

120 

100 

SO 

60 

4 0 H 

20 

0 

rune n-« 

Administrati.e Actions ' (Air.. 

U ' 0 though 198* 

A 

/ \ 

0 I $ * I _ 

* V 

i i i i —r — r i I I i i ' 

70 71 72 7J 7 * 79 76 77 78 7B 80 81 82 

Flseoi Tee, 

S3 84 

I 

5 

12 

it 

10 

» 

N 

7 

6 

9 

4 

3 

2 

1 

0 

Administrotive Actions (Wat~r) Nfb£S 

' >'0 through 1984 

I I I I 1 1 I I I I I I I 

70 71 72 73 74 79 76 77 76 73 60 81 82 63 84 

Fiscal Tear 

400 

I 

i 

H O 

300-

290 -

200 

190 

100 • 

90 -

0 

Administrative Actions (TSCA) 

1970 through 1964 

I I I t I 1 I 1 I I I I 

70 71 72 73 7* 79 76 77 76 79 60 81 82 

rue oi rear 

83 64 
P.97 

I 

i 

300 

Civil Cases Referred 

I97Q through 1964 

Fiscal Tear 

0 

o 

u 

nam f»-> 

Criminal Cases Referred 

197 0 through 196 4 
P.98 

VI-20 

B. General Oversight Criteria, 

T 

The previous section described four key indicators used, to 

evaluate the U.S. compliance and enforcement program: compliance 

rates, progress against significant violators, the extent of 

compliance monitoring and the number of formal enforcement actions. 

There are, however, several other ways to assess the efficiency and 

effectiveness of compliance and enforcement programs. Discussed 

below are:. (1) environmental results, (2) timely and appropriate 

enforcement response, (3) penalties assessed, and (4) resources 

expended and cost-effectiveness of enforcement procedures. 

1. Environmental Results 

Both States and the federal EPA would like to assess the 

effectiveness of the compliance and enforcement programs in 

terms of environmental results. At this time it Is generally 

not possible to attribute a specific environmental benefit 

to the taking of a specific enforcement action. The data 

systems do not permit this type of comparison. Furthermore, 

it is difficult to assess the value of a single enforcement 

action where it has a deterrent effect on others who are 

contemplating whether or not to comply. 

Environmental results are, however, taken into account in 

planning for enforcement program activities, and more sophisticated 

techniques are being developed to better ensure that enforcement 

resources lead to maximum environmental benefits. Each program at 

the national level must prepare a compliance and enforcement 

strategy which begins with the setting of priorities which will 

yield the greatest environmental benefits. At the local level, 

the agency is experimenting with geographically based approaches 

to plan for improved compliance and enforcement actions 

across media programs to assist in resolving a specified 

high priority environmental problem. The Agency's work on 

risk management techniques includes plans to eventually use 

these techniques to assist in setting enforcement priorities. 

However, these activities are not likely to yield results in 

the immediate future. Finally, the definition of significant 

violator and management attention being paid- to resolving 

significant violations in a timely manner will be a major 

step toward ensuring that high priority violations get resolved 

first. 

How well each program is doing in tying compliance priorities 

to environaental results can ultimately be assessed by the state of 

the environment and an analysis of the type of enforcement action 

taken. Substantial achievements have been made in cleaning up 

air and water resources in the U.S. All across the country, 

streams are increasingly fishable and swimmable, all attributable 

to high levels of industrial compliance with NPDES permit 

requirements, and the upgrading of many municipal treatment 

facilities. Based on the best state and regional data, it appears 

that despite significant population and industrial growth, 
P.99 

VI-21 

over the last decade, the U.S. has kept pace in maintaining 

water quality across the country and has significantly'improved 

many areas in particular. Compliance with industrial discharge 

permits resulted in a decrease in biochemical oxygen demand (BOD) 

by 69 percent; suspended solids by 80 percent; oil and grease by 

71 percent;, dissolved solids by 52 percent; phosphate by 74 percent; 

and heavy metals by 75 percent. 

Sewage treatment plants are removing 65 percent more BOD and 

suspended solids than 1973 levels, about 13,600 tons per day. 

By June 1983, 69 percent of the secondary treatment plants required 

by the Clean Water Act had been constructed as compared to 37 

percent in July 1977. 

There have been significant reductions over the last decade 

in air emissions of sulfur dioxide by 27% because of successful 

fuel substitution and stack controls; carbon monoxide by 26% 

because of auto standards; and lead by 57%, primarily because 

of unleaded gasoline. Less overall improvement has been 

made in particulates with a 3% decrease; ozone with a 13% 

decrease; and nitrogen oxides. In all cases, exceedences of 

the national standards were less severe. 

An examination of remaining environmental problems 

shows a substantial correlation between low rates of compliance 

and the environmental problems which remain a significant challenge. 

Those streams with continuing water pollution problems are 

those with non-complying municipal dischargers or as yet 

unregulated non-point sources of water pollution and toxic 

effluent. The air program defines as significant violators, 

non-complying sources located in areas exceeding national 

air quality standards. The ozone standard continues to pose 

a substantial problem and compliance rates are presumed to 

be lower than that for the traditional pollutants. Ground-water 

quality is only now receiving national program attention, 

and is an area for which there are high rates of non-compliance 

with hazardous waste regulations. Although systematic 

linkages cannot be drawn between compliance and environmental 

results, these impacts show significant results and are 

taken into account in managing these programs. 

2. Timely and Appropriate Enforcement Response 

One oft the best indicators of the efficiency of procedures 

and administrative approaches is the time it takes to achieve 

the desired result. Enforcement responses are supposed to 

return the source expeditiously to compliance, that is, as 

quickly as can reasonably be expected. This is assessed on a 

case-by-case basis. No studies have been conducted on the 

average length of time it takes to return a source to compliance, 

although the new tracking systems for significant violations 

should produce a clearer picture of how long it does take. 
P.100 

VI-22 

Until quite recently, U.Si programs also lacked norms 

for defining how quickly most enforcement cases should be 

developed and brought to resolution, specifically, how well 

the program is ensuring: 

- timely initial response to violations once they are 

detected; 

response and penalties appropriate to the violation; 

follow-up to determine if the violation has been 

corrected and/or enforcement order complied with; 

appropriate escalation of penalties, with swift 

enforcement response to continuing violations; 

follow-up.... 

There may be dispute as to whether a good enforcement 

system must respond in some fashion to all violations or just 

to significant violations. There also may be dispute as to 

what should constitute a significant violation. Nevertheless, 

there is always agreement that once a program answers those 

questions, it has failed if responses are tardy or if there 

is no response or if there is no follow-up to ensure compliance 

with the formal response or if there is no meaningful penalty 

imposed for recalcitrance. 

The U.S. EPA has just issued guidance that will form the 

basis for assessing how well enforcement cases are moving to 

closure. As part of the Policy Framework defining criteria 

for good performance, each program office defined timetables 

for the milestones described in Chapter IV. Two key aspects 

of these timeframes are, first, that they will apply only to 

significant violations so as not to use limited agency resources 

in responding inappropriately to less important violations 

because of artificial deadlines. Second, they are not intended 

to be deadlines but rather are general expectations for good 

performance, trigger points for review and presumptions in 

favor of federal intervention depending on the circumstances 

of the case. They will also be adjusted for alternative 

state legal and procedural requirements. An example is 

described in Figure VI-8 for the hazardous waste program. 

Initial response to violations should take place within 30 

days of detection, escalation to an administrative order or 

judicial referral within 150 days thereafter. The air program 

will use 4ft days and 120 days respectively. The water (NPDES) 

program usiss 30 days and 120 days respectively for these 

steps. 

The programs will be evaluated over the next year to 

determine how realistic these expectations are and whether 

performance measures can be designed which are useful to 

apprise management of how well the program is doing in this 

regard. This should result in some significant improvements 

in correcting problems identified in the past. Self-reported 

non-compliance sometimes was not addressed by state and