Posted on June 22, 2012 by Linda Bochert
If you have ever helped a client gain the enforcement protections available under the EPA Audit Policy, be concerned: EPA is reducing its Audit Policy work effort to a “minimal national presence”.
Why? Resources, of course. EPA has too much to do and too few people to do it. As part of the FY 2013 Office of Environmental Compliance Assurance National Program Manager Guidance (OECA NPM), EPA evaluated what it does in light of tightening budgets and overall agency priorities. The EPA Audit Policy came up short: it has resulted in a significant number of annual disclosures, but they are not in the areas of highest priority, and the agency believes traditional enforcement yields greater benefits.
EPA adopted the Audit Policy in 1995 and updated it in 2000. It incentivizes regulated entities to conduct audits, timely self-disclose violations, promptly correct, and put in place systems to avoid repeats. If you do that, any penalty EPA might otherwise apply – for the “gravity” of the violation, or to recover any “economic benefit” gained from noncompliance – can be forgiven. Everyone wins – EPA gets compliance and compliance evaluation systems that protect against future violations; the business gets the certainty and comfort of knowing that if it looks for and finds noncompliance, it won’t be harmed financially; and the public gets the benefit of the environmental improvements.
EPA solicited comments on draft OECA NPM Guidance through March 19, 2012. On April 30, 2012 EPA adopted the final FY 2013 OECA NPM, which included the following at page 15:
Audit Policy/Self-Disclosures: Since implementation of the Audit Policy began in 1995, EPA‘s enforcement program has increased its understanding of environmental compliance auditing, and believes that internal reviews of compliance have become more widely adopted by the regulated community, as part of good management. In addition, EPA has found that most violations disclosed under the Policy are not in the highest priority enforcement areas for protecting human health and the environment. EPA believes it can reduce investment in the program to a limited national presence without undermining the incentives for regulated entities to do internal compliance reviews to find and correct violations. As we reduce investment in this program, EPA is considering several options, including a modified Audit Policy program that is self-implementing.4(emphasis added)
4 Note: To meet the agency wide schedule, the final OECA NPM Guidance is being issued now, although we have not completed discussions on the content and schedule for the budget adjustments portion of the Guidance. Some of the budget adjustments outlined in this final guidance may be revised as we continue work on implementation plans.
I choose to read this to mean it’s not too late to let EPA know what we think. If the planned cutbacks are enacted, they will go into effect for FY 2013, i.e., on October 1, 2012. Creative ideas for ways EPA can address its resource issues and keep the Policy active and vibrant are needed now.
We all recognize the challenges of diminishing resources, changing priorities, and committed constituencies. Regardless, if you agree with me that the Audit Policy has been and should continue to be a valuable tool in the compliance toolbox – for industry, EPA and the public — and want to let EPA know that, please contact me. Let’s see how ACOEL members can constructively contribute to this discussion.
Tags: EPA Audit Policy, audits, OECA, enforcement, NPM Guidance
Audit Privilege | Enforcement | Environmental Protection Agency