The Compliance Enforcement process can feel complex and confusing, especially in a state as heavily regulated as Texas. We began unravelling the topic in a previous article, EHS Compliance in Texas: Preparing for a TCEQ Investigation, by sharing some best practices for getting prepared for an audit from the Texas Commission on Environmental Quality (TCEQ). This follow-up article will go more in depth about the enforcement process and types of enforcement: the different types of investigations, types of violations, and types of enforcement actions.
Investigations are one of the main tools the TCEQ uses to assess your facility’s compliance performance. In our previous article we gave you some general tips on preparing for any type of investigation - now we’ll break down the different types of investigations you’ll likely encounter.
First, a general tip ERA’s compliance consultants always like to share: the backbone of every successful investigation is recordkeeping. Having all your information in one place, easily accessible, and highly organized means that your auditor will have less work to do, there won’t be any surprises, and the whole thing will be finished in less time. Missing or incomplete records are among the biggest red flags auditors look for, and are also a reassuring sign when they’re in order. Start your investigation off on the right foot by getting all your records in order and keeping them that way - you’ll be prepared even for unscheduled investigations.
The three types of investigations to be aware of are:
Investigations due to complaints
Investigations after a record review
Scheduled investigations may occur annually or biannually. The regulators responsible will give prior notice when a scheduled investigation is upcoming, typically one or two weeks in advance. When the inspector arrives, he or she will bring a specific checklist of items used to conduct a Comprehensive Compliance Investigation (CCI). These items, in a general sense, include:
A file review
A facility evaluation
An exit interview
During a CCI, expect the investigator to take a thorough look at all of your records and evaluate your current record keeping system. You should be able to show, through your existing records, that you have kept up with regional and federal reporting requirements and show that you are currently tracking your performance. If your investigator is familiar with your business, you may not be asked to show the full five previous years of paper work but be prepared regardless. If your recordkeeping processes are efficient, it should not be an issue to locate the last five years worth of compliance proof.
If your records are found to be in order, the investigator will move on to a site tour, during which you should be prepared to demonstrate which sources you report for, what control devices are being used on site, and which processes are in place to ensure compliance.
It’s also important, however, to pay attention to the small picture items that can quickly add up to a sizable violation. Missing Safety Data Sheets (SDSs) in the workplace put employees at risk. Improperly sealed, leaking, or labelled containers are a fineable offense. Missing a required safety sign at a worksite is a violation. Issues regarding labelling and employee training around Safety Data Sheets is becoming increasingly important with the adoption of the new GHS SDS guidelines for material safety data sheets. Investigators will be paying closer scrutiny to how you manage, display, and maintain your SDS collection.
Complaint Investigations are unscheduled audits that occur as a result of a complaint from the public, an employee, or an outside organization (for example, a local community group or an environmental watch group). The majority of complaint investigations are due to visual observations such as excessive fumes released from a facility or sludge in a body of water downstream from a facility.
You will not be notified about upcoming complaint investigations. There is typically a 30 day response time from when the complaint is submitted to the investigation, though this can differ based on availability of investigators and severity of the complaint. However, this 30 day period can be detrimental to the regulated community, as during this time the body submitting the complaint is also able to attract media attention and the attention of other groups.
Without a doubt, the best course of action is to ensure your records and operations are in compliance in order to avoid community complaints entirely - but have a plan of action if a sudden equipment malfunction creates visible signs of trouble. First, always be on the look out for visible signs of excess emissions. If you notice something, check your existing records about the source(s) and start keeping records of the event. Since temporary compliance upsets (like an unplanned MSS event) can have long-lasting effects, we’ve written an article specifically about how to respond to equipment malfunctions and MSS events so that you can avoid or minimize penalties. Unsurprisingly, it usually comes down to keeping good records of the whole event.
Record review investigations are also unannounced, and focus on reviewing the documentations for a specific set of documents that should be submitted to the TCEQ (or another state regulator if your facility is located outside of Texas). These include documents like License Irrigators, Dry Cleaner Registration, and Financial Assurance for Petroleum Storage Tanks. TCEQ perform these reviews at the TCEQ offices.
Violations are any act of noncompliance, ranging from the severe to the minimal: minor record keeping infractions are a violations, as are major releases of unauthorized emissions. The list of possible violations is endless, though an EH&S Manager doing their job properly and using a good system should be able to avoid preventable violations.
It’s worth noting that not every violation translates into a fine - a small violation may only require follow-up action rather than carry a financial penalty. However, any violation will be kept on record so that future investigations can track if your facility has a history of repeating the same minor violations - a pattern of any type of noncompliance will be penalized.
If the investigation results in zero violation citations, the compliance enforcement process ends until the next scheduled investigation or until a complaint has been issued against your facility. If the investigator does observe a violation or feels an concerns about your operations, you will receive either a Notice of Violation (NOV), Notice of Enforcement (NOE), a Field Citation, or an Area of Concern (AOC) letter.
There are also three categories of violations - A, B, and C - that measure the severity of any noncompliance and noncompliance patterns:
Category A - The highest degree of severity, requiring immediate enforcement if observed during an investigation. This includes violations like documented falsification of data, operating with an expired permit, and unauthorized disposal of solid waste.
Category B - The responsible party will first be given an opportunity to comply through a NOV, which will specify a compliance due date, solicit a compliance schedule, and/or acknowledge resolved violations. Note that two B violations within the most recent 5-year period will result in automatic enforcement and the violation will not be erased after compliance. A common example of a category B violation is failing to conduct adequate monitoring where required by an operating permit.
Category C - The lowest degree of noncompliance severity, three C violations within the previous 5 years will result in automatic enforcement. Examples include using slightly torn filter bags for collecting baghouse dust and failing to control wind-blown waste.
Notice of Violation
A NOV alert your EH&S department and executives to some type of violation at your facility, and gives you an opportunity to take corrective actions to achieve compliance without the violation being brought before the Enforcement Division. Most NOVs fall into the B or C categories, and typically come with a 30-day window to correct in order to avoid penalties.
Notice of Enforcement
The NOE is given out to any facility that requires immediate enforcement action and/or fines. This is most commonly the case when one or more category A violations are observed or when multiple smaller violations add up over the past five years. A NOE does not come with the opportunity to achieve compliance in order to avoid fines.
Field Citations are a less common type of notice that is designed to promote a quick resolution for observed violations. A Field Citation usually comes with a reduced monetary penalty compared to the more formal enforcement process.
If presented with a field citation, you have the option to accept it and pay the fine, or to decline the field citation and opt to go through the standard administrative enforcement process. Typically, this will result in a higher fine if the Office of Enforcement and Compliance Assurance (OECA) sides with the investigator. Declining a field citation is only recommended if you are 100% positive the investigator is incorrect - however, your records should be clear enough to prevent this from occurring.
Area of Concern
An AOC is a type of violation that meets the all of following TCEQ criteria:
The violation falls into category C
The violation does not involve a potential harm/impact
The violation is corrected within 14 calendar days of the investigation date
The violation was not documented at the same facility in the prior 12 months
An AOC, if corrected within the given time frame, should not appear in your compliance record. A NOV or NOE may come with one or more AOCs in it, but an NOE will not come with AOCs.
When Enforcement is Pursued
Before enforcement is pursued the Office of Enforcement and Compliance Assurance (OECA) screens the case in order to ensure that it meets the enforcement initiation criteria. Once a decision has been reached, either agreed orders or findings orders enforcement actions will be put into place:
Agreed Orders - are the most common type of enforcement action. The majority of enforcement cases fall under this category. Agreed orders also contain a 20% deferral off the penalty amount.
Findings Order - is given when three repeated enforcement actions are noted and there is an effect on human health and/or the environment. There is no 20% deferral should you receive a findings order. For more serious violations, findings orders contain an admission of guilt, and multiple findings order will increase the penalty amount.
The OECA Enforcement Coordinator assigned to your case will send you the following standard documents:
Penalty calculation worksheet
After receiving these documents, you have several options for payment/reconciliation. The actual fines or actions required will vary by case and will be outlined in the above documents from the Enforcement Coordinator:
Pay the penalty in full in one lump sum.
Establish a payment plan with the Enforcement Coordinator.
Request a Financial Inability to Pay Review from the OECA, in cases where your business cannot pay the fine.
Undertake supplemental environmental projects (SEPs). A SEP is a course of action required by the OECA in addition or in lieu of a monetary penalty.
Litigation, if you wish to contest the enforcement actions or violations.
Once you complete the enforcement action, the enforcement process concludes but will stay on your record for the next 5 years.
The entire Enforcement Process, outlined above, hinges on having clear and auditable records. It is not enough to simply undertake the actions of compliance, you must also have all the paperwork and records in place to prove to any outsider that you business operates according to federal and regional EH&S regulations.
You likely already have processes and policies in place to maintain your compliance activities - now is a good time to include updating your recordkeeping practices and establish some clear guidelines for tracking, recording, and storing your compliance activity documents. A good first step is centralizing all your documents: a good EH&S software platform should be able to offer an easy to access and organized methodology for recordkeeping.
About the Author: Alex Chamberlain is a writer and blogger who regularly contributes to ERA Environmental Management Solutions' blog. You can find Alex on Google+, LinkedIn & ERA's Environmental Compliance blog