Developing an Environmental Compliance Plan 1 - Laurie …lscdesignva.com/graphics/books/ENREG.pdf · · 2018-01-17Developing an Environmental Compliance Plan ... Developing an

Manager’s Guide to Environmental Regulations �

1Developing an Environmental Compliance Plan

Purpose: Complete and continuous environmental compliance in all areas can be a difficult and expensive challenge. To achieve and then maintain a high level of compliance requires time, resources and planning. A well-developed environmental compliance plan can improve your effective-ness and efficiency. Conducting an internal environmental audit is an excel-lent method for determining a facility’s environmental status and identifying weak points.

Overview In today’s regulatory atmosphere, industry managers frequently face many complex and pressing environmental compliance and enforcement situations. Often, facilities are subject to multiple environmental regulatory issues cutting across both federal and state regulations, including the Clean Water Act; the Resource Conservation and Recovery Act; the Clean Air Act; the Comprehensive Environmental Response, Compensation and Li-ability Act; the Emergency Planning and Community Right-To-Know Act; the Toxic Sub-stances Control Act, and other requirements.

Environmental compliance is a challenge that many people talk about, but few actually achieve in full. It refers to the condition or status that exists when a facility fully complies with all applicable environmental laws and regulations. The compliance status of a facil-ity may vary according to the particular regulations that affect the operations. A facility may be in compliance with one regulatory program and out of compliance under another program.

An environmental manager strives to achieve full compliance with all applicable environ-mental laws and regulations. Compliance failures can result in enforcement at the federal and state levels, monetary penalties, damage to a facility’s reputation and lawsuits. Some

Chapter 1: Developing an Environmental Compliance Program

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environmental programs are designed to reduce the risks of catastrophic accidents, and a major incident related to noncompliance can result in huge liability.

One basic tool for helping environmental managers achieve and maintain regulatory compliance is a facility-specific environmental compliance plan. A well-developed plan can improve effectiveness and efficiency, and help the staff focus on the facility’s goals, performance objectives and key compliance tasks.

A second, more arduous method for assess-ing environmental compliance is an inter-nal environmental audit. Conducting an audit requires greater effort and resources over a short time frame, but it produces a more detailed and in-depth assessment of the facility’s environmental compliance and weaknesses.

In addition, information management is a large component of maintaining compliance. Reporting and recordkeeping is time consuming, but it can make up the bulk of the activ-ities necessary to comply with environmental regulations. Often, the most difficult aspect of environmental compliance is having the right document to demonstrate compliance.

By working through basic planning steps, the environmental manager, with assistance from facility engineers, operational staff and others, can establish strong internal proce-dures for developing a comprehensive environmental compliance plan. Once created, the plan can help facility management to better monitor ongoing compliance and maintain the facility’s compliance profile.

Monitoring Environmental ComplianceMost environmental regulatory programs administered by the U.S. Environmental Protection Agency (EPA) or state agencies are designed to be self-implementing and self-monitoring. A facility must determine the applicable requirements and prohibitions that affect its activities, and implement measures or programs to comply. Under EPA regula-tions, environmental compliance can be as simple as documenting an inspection event once a year and as complex as formulating a stormwater pollution prevention plan or drafting a risk management program.

Complete and continuous environmental compliance in all areas can be a difficult and expensive challenge. The most efficient and decisive way to achieve and maintain full compliance is through a comprehensive environmental management process. The goal of such a process is to combine the right amounts of resources, guidance and time to meet specific regulatory requirements in full. Through the management process, a facility should identify regulatory requirements, develop plans, arrange for resources, carry out compliance tasks and assess performance.

Planning environmental compliance requires managing multiple tasks at one time. Environmental compliance managers must know the regulatory requirements, create a vision of the desired compliance status and develop a plan to realize such compliance.

Themostefficientanddecisivewaytoachieveandmaintainfullcomplianceisthroughacomprehensiveenvironmen-talmanagementprocess.



Identifying compliance tasks helps managers determine the human, financial and mate-rial resources needed to meet all regulatory requirements. If performed well, the envi-ronmental management process may provide for full and continuous compliance with all applicable standards and regulations.

A company or facility must continually evaluate its actual achievement against prescribed standards and regulations. Senior management must measure its own environmental performance as well as that of middle and lower managers to ensure that they are sup-porting the company’s stated goals.

Regardless of the effort made to comply, close scrutiny during an internal environmental audit or enforcement inspection likely will reveal the existence of violations. On discover-ing such violations, a facility should correct them immediately.

How To Know if Your Facility Is in Full ComplianceThere are three principle ways to determine the status of a facility’s environmental compliance:

1. self-monitoring;

2. conducting an internal environmental audit; or

3. through a regulatory inspection.

In addition, area monitoring is a common method for determining environmental compli-ance status in the vicinity of your facility.

Self-Monitoring

Most federal environmental laws require the regulated entity to monitor its own compli-ance status. As required, a facility must track compliance and report all or part of the results to the appropriate regulatory agency. This monitoring enables the facility to de-termine its compliance status. It also gives the regulatory agency the data it needs to find out if the facility is complying with or violating the law. To verify the reported data and to check for inaccurate or fraudulent reporting by facilities, environmental enforcement agencies conduct regulatory inspections.

Environmental Audits

An environmental audit goes beyond the type of compliance assessment normally con-ducted during self-monitoring, regulatory inspections and area monitoring. It examines the extent to which management systems, established procedures or work practices achieve, demonstrate and ensure continuous compliance. The audit process can be divided into five procedural steps resulting in a final report to management. (See page 8 for a detailed explanation of conducting an environmental audit.)

Regulatory Inspections

Only a regulatory agency can determine the “legal” regulatory compliance status of a facility, typically through an inspection. An inspection is an examination into the



environmental affairs and records of a facility to determine its level of compliance. Inspections are the government’s primary tool for monitoring and assessing compliance. In general, the agency will notify the facility in advance of its intent to inspect the facility and the regulatory scope of the inspection.

At the conclusion of the inspection, the agency normally will provide the facility with a briefing that summarizes its findings. The findings become the basis for a variety of pos-sible enforcement actions. If the regulatory agency finds the facility in compliance, the facility may or may not receive a written response. If the agency finds violations, the facil-ity may face enforcement action. EPA’s inspection likely will go beyond the current status of the facility and look back several years for past compliance or violations.

Area Monitoring

To determine the environmental conditions over a large area, the regulatory agency may use area monitoring. Aerial surveillance, ambient monitoring remote sensing and other methods are some of the techniques used to gather data during area monitoring. For ex-ample, to monitor groundwater quality in a large area, EPA may install wells, then sample and analyze the groundwater beneath the area. Area monitoring also is commonly used to determine ambient air quality and compliance with applicable air standards. If prob-lems are discovered, such as contaminated groundwater, the agencies will conduct an investigation to uncover their source.

How To Develop an Environmental Compliance PlanTo achieve and maintain full compliance, a facility must identify compliance require-ments, arrange for financial and staff resources, perform compliance activities and assess performance. The basic tool for doing this is a facility-specific environmental compliance plan. Such a plan can be useful regardless of a facility’s current compliance status because it identifies ongoing tasks.

A well-developed plan consolidates the various compliance requirements into a concise statement to provide a systematic basis for identifying applicable rules, establishing objectives and carrying out tasks to meet the compliance goals envisioned by the facility. Planning environmental compliance requires input from several important sources. The facility must research federal, state and local laws for regulatory requirements, or check for any regulatory changes or modifications. Any recent changes in the facility’s opera-tions or chemical inventories could trigger new coverage by environmental regulations. The company’s organizational structure and strategic plan provide policies, guidelines and programs to direct and control the facility. In addition, the company’s top manage-ment must commit the financial, material and staff resources if the company’s goal is good execution of environmental affairs.

The overall objective of the plan is full compliance with all applicable environmental laws, regulations and permits that govern the disposition of industrial wastes, emissions to the air or water, and other facility activities. There are many different ways to plan for compliance. However, a well-developed compliance plan can improve effectiveness and



efficiency by focusing on the mission, visions, goals, performance objectives and key compliance tasks.

By identifying the trends, patterns, and timing of compliance tasks, the environmental manager can forecast resources and conditions that impact compliance. As discussed below, after analyzing its challenges, the facility should develop a compliance plan by following the steps — from determining the plan’s mission to listing specific tasks — as depicted in the graphic below.

Mission

When developing an environmental compliance plan, a facility should begin by stating what it intends to accomplish through its plan. This is the mission statement. In general terms, it declares what the facility must do, and when, where and why it must be done. For example, the mission statement might read as follows:

Through compliance with environmental regulations, protect public health, the com-munity and the environment from adverse effects of the facility’s operations and avoid enforcement.

Environmental Compliance Plan Development

—Laws—Policies—StrategicPlan—Guidelines

Goals

Objective

Tasks

Vision

Mission



The mission statement comes from the company’s policy and places primary responsibil-ity on a person or position in the organizational structure.

Vision

The next element of the compliance plan is a vision of what the organization should look like at some point in the future. Directed to the company, the vision gives the mission a focus in general terms. For instance, your vision might resemble the following:

On or before the effective date, we will achieve full compliance with applicable regula-tions and be prepared to demonstrate such compliance to any regulatory agency in 30 minutes or less.

The facility should continually work toward achieving the vision.

Compliance Goals

The next step is setting compliance goals. More focused than the mission and vision, goals direct the facility to the specific environmental regulations or permit limits it must follow.

Determining the regulatory compliance requirements applicable to a given facility likely will require assistance from the company’s legal staff, engineers, process supervisors

and/or outside consultants. Managers can build on earlier analyses and goals. But if the applicable requirements have not been reviewed recently, it may be prudent to review if any changes in the facility’s process, chemical inventories, emissions levels or other operations have changed and thereby result in new regu-

latory requirements. EPA and states modify regulations periodically, and a facility should take steps to ensure it is aware of these modifications.

At this point, the facility should create a general “ownership” of the plan by getting partici-pation from various members of the organization. For each environmental regulation the facility is subject to, a goal that states in precise, measurable terms what must be done to maintain or get into compliance should be developed. For example, to ensure compliance with Clean Water Act (CWA) requirements, an enabling goal might state the following:

Develop written guidelines for permitting and controlling point source discharges of wastewater to navigable waters from the facility. Explain and simplify monitoring, noti-fication, reporting and recordkeeping requirements. Identify individual responsibilities and provide procedural schemes for demonstrating compliance.

Performance Objectives

From each goal, the facility should establish narrowly focused performance objectives that match the broad requirements of the law. Your performance objectives should follow regulatory standards in precise, measurable terms.

Foreachprogramthatthefacilityissubjectto,agoalthatstatesinprecise,measurabletermswhatmustbedonetobeincomplianceshouldbedeveloped.



The following are examples of what such objectives might look like:

• By the end of the first quarter, complete the National Pollutant Discharge Elimina-tion System (NPDES) permit renewal application, obtain the authorized signatures and submit it to the state water authority.

• By mid-February each year, complete the chemical inventory forms required under the Emergency Planning and Community Right-To-Know Act (EPCRA).

• By the end of the second quarter, implement a stormwater pollution prevention plan, train personnel, complete pre-arrangements for monitoring and install containment.

Meeting the objectives may require specific monitoring, notification, reporting and re-cordkeeping. It is important to check applicable state requirements, which may differ.

Compliance Tasks

The next element of the plan is to identify key environmental compliance tasks the facility must do to meet the performance objectives. Such tasks are specific activities that produce reports, surveys, inspections, audits, permit renewals, training documents, monitoring records, etc.

For example, compliance tasks that would come from the CWA performance objective might include the following:

• Submit information that EPA has requested to determine if cause exists to modify, revoke and reissue, or terminate the permit.

• Monitor wastewater discharges on the first of the month and submit a discharge monitoring report by the fifth day of the following month.

• Submit scheduled compliance and noncompliance reports for regulated discharges.

• Give notice to EPA as soon as possible of planned physical alterations or additions that may cause the facility to be considered a new source or that may significantly change the nature or increase the quantity of pollutants.

• Notify EPA 10 days in advance, if possible, of a known need for a bypass.

Implementing the Plan

To track the accomplishment of your plan, a manager may develop a yearly compliance calendar that consolidates all the compliance tasks and deadlines in one document. The compliance calendar is a convenient tool for monitoring and scheduling compliance tasks. To create a compliance calendar, list all the regulatory compliance tasks that must be done at your facility over the course of a year in the left column, such as reporting deadlines, permit renewals, data monitoring, etc. List the 12 months across the top. Then under the correct month, list the target completion date or deadline for a given task.



Review the completed calendar frequently to accomplish all events in a timely manner and update the calendar as changes occur.

After mapping out your yearly requirements on the compliance calendar, you need a technique to track the status of all of these activities. This is the function of a weekly schedule. Your weekly schedule should represent a plan for managing your time during a typical week. It can be a generic

schedule, but must be realistic. It must work for you or it is worthless. A weekly schedule is never permanent; you must revise it if, after a trial period, it does not work for you. Prepare a daily “To Do” list to set priorities and manage your time. Maintain your daily list in a bound notebook for future reference. Each evening before you leave the office, spend a few minutes to evaluate your accomplishments and reset priorities.

How To Conduct an Environmental AuditConducting an internal environmental audit can be an effective tool for identifying and correcting problems before they are discovered during a regulatory inspection. As part of the environmental management process, auditing provides a detailed, systematic approach for assessing a facility’s compliance program. A facility may want to schedule and conduct an audit at least every one to two years. In addition, a facility may want to conduct an audit in advance of any formal regulatory inspection for which the facility has received notice.

There may be legal risks associated with an environmental audit. Under some circum-stances, audit reports may be used against the facility in enforcement actions. Before conducting an audit, the facility should obtain legal advice to determine an appropriate course of action.

Self-Reporting of Violations

Aside from the internal benefit an audit may bring in alerting facility management to any environmental compliance issues, EPA offers significant civil penalty reductions to facili-ties that self-disclose violations of environmental laws. In some cases, these disclosures can lead to a complete waiver of the gravity component of the civil monetary penalty, as well as a determination not to recommend criminal prosecution of the disclosing entity.

However, to claim these benefits, management must closely follow the agency’s self-audit policy, Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention of Viola-tions (http://www.epa.gov/ebtpages/compcomplianceinceauditpolicy.html) and a facility must discover the violation voluntarily. To receive a complete waiver of the gravity-based portion of the penalty, management must meet all nine conditions set out in the policy. “Gravity-based” refers to the portion of the penalty over and above the economic gain from noncompliance (known as the “economic benefit”). If a facility meets all but the first condition — systematic discovery of violations — it is eligible to receive a 75 percent reduction in the gravity-based civil penalty.

Afacilitymaywanttoconductanin-ternalenvironmentalauditinadvanceofanyformalregulatoryinspectionforwhichthefacilityhasreceivednotice.



In addition, EPA normally will not recommend criminal prosecution by the U.S. Depart-ment of Justice for a facility that meets at least the last eight conditions, “as long as its self-policing, discovery and disclosure were conducted in good faith, and the entity adopts a systematic approach to preventing recurrence of the violation,” EPA’s policy states.

(See Compliance Tool 1, page 15, for a detailed description of EPA’s self-audit policy and the nine conditions.)

Five Steps in an Environmental AuditAuditing goes beyond the type of compliance assessment normally conducted during self-monitoring, regulatory inspections and area monitoring. It checks the extent to which management systems, established procedures or work practices achieve, demon-strate and ensure continuous compliance.

The audit process can be divided into five procedural steps:

1. preparation,

2. pre-audit,

3. conducting the audit,

4. post-audit, and

5. improvement activities.

To complete the audit, the facility should do a follow-up review to confirm that each of the audit findings and recommendations is addressed. The procedural steps for conducting an environmental audit are discussed below.

Preparation Activities

The preparation step begins with the decision to audit the facility and involves review of the applicable environmental laws, regulations and procedures. It is designed to familiar-ize the person in charge of the audit (the audit leader) with the site activities, refine the auditing protocol and prepare for the audit.

The primary activities in the preparation step are:

• organizing and training the audit team;

• reviewing files and gathering data;

• reviewing applicable regulations;

• reviewing measures of performance; and

• developing a site-specific approach.


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Pre-Audit Activities

The pre-audit step includes a background review to obtain information needed for the audit. It begins with a written notification of the pending audit. The notification gener-ally requests personnel, permits, information, equipment and records needed during the audit.

A background review will provide information about the facility and will establish the specific standards to assess. The background review should involve both legal and techni-cal information. The auditor should review available files and interview appropriate person-nel familiar with the facility construction and operations. The background review should assess the compliance records maintained by governmental agencies with respect to the facility and identify concerns about actual and potential environmental liabilities and risks.

The following types of information should be obtained during the back-ground review:

• Environmental Standards and Regulations. There are several sources of relevant regulations. The facility already may have a file and summary of applicable regulations; but if not, the company should contact legal staff or an out-side environmental attorney or consultant. The internet con-tains texts of federal and state laws and regulations as well as interpretative information that can be helpful in deter-mining compliance. (See the Additional Resources sections in the subsequent chapters for sources of information regard-ing particular environmental regulations.) Local regulations may be on the Internet or can be determined by contacting local agencies directly.

• Permits, Permit Applications and Annual Reports. Copies of site permits and permit ap-plications should be obtained from the facility’s records. If the facility is subject to annual

Environmental Audit ProcessPreparation

• OrganizeandTrain

• ReviewFiles

• ReviewRegulations

• DevelopApproach

Pre-audit

• ReviewPermits

• ReviewBackgroundData

• CheckEnforcementFiles

Prepare Audit Plan

• Objectives

• SiteOverview

• Assignments

• Schedule

• Protocols

Conduct Audit

• Opening

• DocumentsReview

• Interviews

• Inspections

• Closing

Post-Audit

• Report

• Findings

• Recommendations

• Follow-up


Manager’s Guide to Environmental Regulations ��

reporting requirements, such as under EPCRA, a copy of the most recent reports should be obtained.

• Technical Reports and Investigations. Usually, these documents originate in conjunction with operational and environmental projects. They provide informa-tion on the site operations, treatability data, waste disposal techniques, site history and physical layout of the facility.

To conduct an effective audit, the auditor must develop and execute a plan for informing all involved parties of the upcoming activities. The plan should cover unique instruc-tions for the audit and address procedures for handling and processing confidential information.

The plan should address the following items:

• Audit objectives. The plan should identify the facility or portions of the facility to be audited and what the audit is intended to accomplish.

• Site overview. The plan should provide a description of the site; its physical layout; its operations; its permits; records and copies of recent required annual reports; emergency planning records; facility’s risk management program (if applicable); previous enforcement actions and settlements (if applicable); and a list of relevant corporate, federal, state and local standards and regulations that cover the site.

• Inspection/Interviews. The plan should identify the personnel to be interviewed and the equipment and facilities to be inspected. It should define the information needed to assess site compliance and procedures for such assessment.

• Team assignments. The plan should assign to members of the audit team tasks for accomplishing the objectives of the audit. The assigned tasks should involve an evaluation of process operations, emissions control practices, waste treatment and disposal practices, operation and maintenance procedures, recordkeeping and reporting, and pollution abatement needs.

• Audit schedule. Provide a schedule of the audit activities in the plan. Establish dates and times for starting and finishing the onsite activities and for submitting draft and final reports.

• Audit protocols. Use checklists as reference documents for planning and conduct-ing audits when possible.

Conducting the Audit

This step of the audit takes place at the audited facility. It consists of an opening confer-ence, records/documentation reviews, staff interviews, physical inspections, completion of checklists and a closing conference.


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Opening Conference

During this meeting the audit leader will introduce the audit team and discuss the proto-col of the audit. This should include a discussion of the following topics:

• the reasons for the audit and the objectives;

• the specific areas to be inspected and the individuals who will be interviewed;

• the makeup of the audit team and the specific areas of expertise of each team member;

• how the audit will proceed and the disposition of the findings; and

• safety and health concerns, or other site-specific issues.

Records/Documentation Reviews

During the audit, review the records requested in the audit written notification. This review should provide many of the compliance requirements to be assessed. The auditor should review permits and consent agreements for terms and conditions and verify that they are being met.

Staff Interviews

Interviewing facility personnel during the audit may be necessary to verify compliance not readily apparent by a review of the records and inspections.

Physical Inspections

The auditor should tour regulated environmental activities at the site to observe and verify compliance. Detailed attention should be given to the activities to detect indica-tions of noncompliance.

Protocol Checklist

The audit inspections and interviews should follow an outline of the audit checklist as much as possible. The checklist should be completed based on findings observed during the audit.

Closing Conference

Convene the audit team after it has completed the inspection of the site to develop a list of findings. This meeting should result in a preliminary assessment of the site’s environ-mental compliance. The findings should be used to draft a preliminary report. The report should list the potential weak points and be outlined in a format such as the following:

• the overall assessment of the particular environmental program;

• a summary of the program strengths and weaknesses;

• identification of the weaknesses that need immediate attention by the site staff;



• an itemization of other findings that will need attention; and

• a summary of the areas of uncertain compliance.

Upon development of the preliminary assessment, the auditor should meet with the en-vironmental compliance manager and brief him on the preliminary findings of the audit. The auditor should make it clear that the report is only a preliminary assessment and that a draft and final report will be provided later.

Post-Audit Activities

During the post-audit stage, the auditor should formalize the findings and develop rec-ommendations for addressing problems. The post-audit activities involve the preparation of the draft report, final report and follow-up reports.

Draft Audit Report

The auditor should prepare the draft audit report immediately after the onsite activities. The report should summarize the findings of the site inspections and interviews. The draft audit report should contain the following elements:

• a summary that provides a brief overview of the findings, scope of the audit, and the agreements reached on the corrective actions needed;

• a list of the audit participants including the audit team, the team leader, and the participants from the site;

• the audit results, consisting of a report for each major area within the scope of the audit, such as air emissions control, water pollution control and hazardous waste man-agement; and

• recommendations for each finding discovered during the audit as to the actions to take to address them.

Final Audit Report

After the appropriate reviews of the draft report, the auditor should prepare a final audit report. The format of the final report should be the same as the draft report. Upon completion of the final audit report, all copies of the draft report should be destroyed. The final audit report should be kept confidential and the distribution of the report should be limited.

Improvement Activities and Plan

The audited facility should prepare a plan based on the final audit report to implement the recommended corrective actions. All the findings do not need correcting at the same time, but should be addressed as quickly as possible. Any clear violations should be cor-rected immediately.

Theauditorshouldpreparethedraftauditreportimmediatelyaftertheonsiteactivities.



The facility should develop and follow a schedule for completion and tracking the status of the corrective action plan. The progress of environmental improvements should be reviewed periodically after the audit.

Integrated Contingency Plan Guidance — ‘One Plan’With respect to emergency planning, many facilities may be subject to emergency plan-ning requirements under multiple regulatory programs.

In 1996, the National Response Team created the Integrated Contingency Plan (ICP), a guidance document to help facilities that are subject to more than one federal emergency planning regulation. Known informally as the “One Plan,” it is designed to assist facili-ties in preparing a single emergency response plan that demonstrates compliance with emergency planning requirements under a number of regulatory programs, including risk management program regulations, EPCRA and the hazwoper standard. By using the guidance, facilities can consolidate multiple emergency response plans into a single functional plan known as an ICP.

The One Plan guidance is available on EPA’s Web site at http://yosemite.epa.gov/oswer/ceppoweb.nsf/content/ConsolidatedPubs.htm



Compliance Plan Practice Tool � EPA’s Self-Audit Policy

Facilities Get Penalties Reduced or Waived by Meeting Conditions in EPA’s Self-Audit PolicyTheU.S.EnvironmentalProtectionAgency(EPA)offerssignificantcivilpenaltyreductionstocompaniesthatself-discloseviolationsofenvironmentallaws.Insomecases,thesedisclo-surescanleadtoacompletewaiverofthegravitycomponentofthecivilmonetarypenalty,aswellasadeterminationnottorecommendcriminalprosecutionofthedisclosingentity.

However,toclaimthesebenefits,managementmustcloselyfollowtheagency’sself-auditpolicy,Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention of Viola-tions.Toreceiveacompletewaiverofthegravity-basedportionofthepenalty,managementmustmeetallnineconditionssetoutinthepolicy.“Gravity-based”referstotheportionofthepenaltyoverandabovetheeconomicgainfromnoncompliance(knownasthe“economicbenefit”).Ifafacilitymeetsallbutthefirstcondition—systematicdiscoveryofviolations—itiseligibletoreceivea75percentreductioninthegravity-basedcivilpenalty.

Inaddition,EPAnormallywillnotrecommendcriminalprosecutionbytheU.S.DepartmentofJusticeforacompanythatmeetsatleastthelasteightconditions,“aslongasitsself-policing,discoveryanddisclosurewereconductedingoodfaithandtheentityadoptsasystematicap-proachtopreventingrecurrenceoftheviolation,”EPA’spolicystates.

Belowaretheself-auditpolicy’snineconditionswithadiscussionofwhattheymeanforfacili-tieswishingtoself-disclose:

�. Systematic Discovery of the Violation Through an Environmental Audit or a Com-pliance Management System —Facilitystaffmustdiscovertheviolationthroughanenvironmentalaudit,oracompliancemanagementsystemthatreflectsduediligenceinpreventing,detectingandcorrectingviolations.Environmentalauditisdefinedinthepolicyasa“systematic,documented,periodicandobjectivereviewbyregulatedentitiesoffacilityoperationsandpracticesrelatedtomeetingenvironmentalrequirements.”Acompliancemanagementsystem encompassesafacility’sdocumentedsystematiceffortstoprevent,identifyandremediateviolations.Thismayincludemechanismsforsystematicallyensuringthatcompliancepolicies,standardsandproceduresarebeingcarriedout;effortstoeffec-tivelycommunicateyourstandardsandprocedurestoallemployeesandotheragents;orothermeans.

ProvideEPAwithaccurateandcompletedocumentationabouthowyourcompliancemanagementsystemmeetsthecriteriaforduediligenceoutlinedinthepolicyandhowstaffdiscoveredtheviolationthroughthissystem.EPAmayrequirethatafacilitymakeadescriptionofitscompliancemanagementsystemavailabletothepublic.

�. Voluntary Discovery —Afacilitymustdiscovertheviolationvoluntarily.Iftheviolationwasdiscoveredthroughamonitoring,samplingorauditingprocedurerequiredbystatute,regulation,permit,judicialoradministrativeorder,orconsentagreement,itisnoteligiblefortheself-auditpolicy.Forexample,iffacilitystaffdiscoveraviolationofNationalPol-lutantDischargeEliminationSystem(NPDES)dischargelimitsthroughrequiredsamplingormonitoring,thefacilitymaynotusethepolicy.

However,ifstaffdetectaviolationthroughanauditconductedaspartofacomprehensiveenvironmentalmanagementsystemrequiredunderasettlementagreement,thefacilitymaystillbeabletousethepolicy.Inaddition,the“voluntarydiscovery”requirement



appliesonlytodiscovery,notreporting.Ifafacilityvoluntarilydiscoversaviolation,itmaybeabletousethepolicy,evenifthereportingoftheviolationwasrequired.

�. Prompt Disclosure —ManagementmustdisclosetheviolationtotheappropriateEPAregionaloffice,inwriting,within21daysafterdiscovery(alistofthesecontactsisavailableontheEPAWebsiteathttp://www.epa.gov/compliance/incentives/auditing/auditdis-close.html).Ifmultipleregionsareinvolved,disclosetheviolationtoEPAheadquarters.The21-dayperiodbeginswhenanyofficer,director,employeeoragentofyourfacilityhasanobjectivelyreasonablebasisforbelievingthataviolationhas,ormayhave,occurred.Ifyouarenotsurewhetheraviolationhasoccurred,youshouldproceedwiththedisclosureandallowEPAtomakethedetermination.

Whenmakingyourdisclosure,identifythemeansofdiscovery,typeofviolationandyourfacility’slocation.Youwillthenreceiveafollow-upletterfromEPAwithguidanceonwhatinformationtheagencyneedstodeterminewhetherthefacilitymeetstheauditpolicy’sconditions.

�. Discovery and Disclosure Independent of Government or Third-Party Plaintiff —ThefacilitymustdiscovertheviolationbeforeEPAoranothergovernmententitylikelywouldhaveidentifiedtheproblemthroughaninvestigationorinformationrequest,orcommence-mentofacitizensuitorotherthird-partyaction.Don’twaituntilyouthinkanenforcementactionorlawsuitmightbebroughtagainstyourfacility.

�. Correction and Remediation —Afacilitymust,within60daysofdiscoveringtheviola-tion,remedyanyharmcausedbyitandcertifyinwritingtotheappropriateauthoritiesthatmanagementhasmadethecorrection.Thismayincluderespondingtospillsorcarryingoutanyremovalorremedialactionsrequiredbylaw.

�. Prevent Recurrence —Managementmusttakestepstopreventarecurrenceoftheviola-tion.Thesemayincludeimprovementstotheenvironmentalauditingeffortsorcompliancemanagementsystem.

�. No Repeat Violations —AfacilityisnoteligibletouseEPA’sself-auditpolicyifthesameoracloselyrelatedviolationhasoccurredatthefacilityinthepastthreeyears.Thethree-yearperiodbeginswhenthegovernmentorathirdpartyhasgivenyounoticeofaspecificviolation,withoutregardtowhentheoriginalviolationcitedinthenoticeactuallyoccurred.

Ifyourfacilityispartofamulti-facilityentity,youarenoteligiblefortheauditpolicyifthesameoracloselyrelatedviolationoccurredaspartofapatternofviolationsatoneormoreofthesefacilitieswithinthepastfiveyears.Ifyourfacilityisnewlyacquired,aviola-tionthatoccurredbeforeacquisitiondoesnottriggerthisexclusion.

�. Other Violations Excluded —Violationsthatresultinseriousactualharmtotheenviron-mentormaypresentanimminentandsubstantialendangermenttopublichealthortheenvironmentarenoteligiblefortheself-auditpolicy.Note,however,thatviolationsthatinvolvethereleaseofapollutanttotheenvironmentmaybeeligible,becausetheydonotnecessarily resultinseriousoractualharmoranimminentandsubstantialendangerment.

�. Cooperation —ManagementmustcooperatewithEPA,providingtheinformationtheagencyneedstodeterminehowandiftheself-auditpolicyappliestoyourdisclosure.Man-agementmustnothide,destroyortamperwithpossibleevidenceafterthediscoveryoftheviolation.



Ifyourdisclosureinvolvesapotentialcriminalviolation,expectamorethoroughreviewbyEPA.Inthesecases,youwillbeexpectedtoprovide,amongotherthings,accesstoall:re-questeddocuments;thefacility’semployeesorcontractors;andinformationrelevanttotheviolationsdisclosed.

Rememberthatevenifyourfacilityqualifiesforacompletewaiverofthegravity-basedportionofthepenalty,EPAmayrecoveranyeconomicbenefitthatthefacilitygainedbynoncompli-ance,topreservea“levelplayingfield.”Iftheagencydeterminesthattheamountofeconomicbenefitisinsignificant,ithasdiscretiontoforgivetheentirepenaltyforviolationsthatmeetallnineconditions.

Formoreinformation,seehttp://www.epa.gov/ebtpages/compcomplianceinceauditpolicy.html.