As if environmental compliance reporting isn’t confusing enough. What chemicals, for instance, does the EPA consider “hazardous.” If they are hazardous, what are their Tier II reporting thresholds? And why do Tier II reporting requirements (a.k.a., Tier 2 reporting requirements) for states and local jurisdictions constantly change? 

When EPA reports are inaccurate, incomplete, or never even filed when they’re required to be, the last thing compliance leaders need are notifications of non-compliance and potential EPA violation fines. Nor do many EHS teams have the time and resources to spend on remediating EPA violations, instead of working on higher priority initiatives like sustainability. 

Within the scope of environmental compliance reporting, the best way to avoid any violation is to first understand what constitutes non-compliance. Equally vital is understanding how proper reporting can guard against your organization being reported in environmental complaints or for a company violation of some kind.

What Is an EPA Violation Where Reporting is Concerned?

There are far too many potential causes of compliance and Tier 2 reporting violations to delve into here. There’s also no “official” EPA violations list, per se. But a good example of documented violation triggers comes from an EPA alert that took effect in November 2021 for Tier 2 reporting year 2022.

To address chemical storage concerns for EPCRA, the EPA issued an Enforcement Alert on the Risks of Improper Storage of Hazardous Chemicals at Chemical Warehouses and Distribution Facilities. The Alert noted that businesses filing compliance reports constantly failed to:

Among these concerns, the failure to submit a Tier II form is clearly a violation. Less clear, however, is an issue such as an up-to-date Safety Data Sheet (SDS). 

Safety Data Sheets are often outdated

Even when SDSs are filed as needed to meet Tier 2 reporting requirements, they’re often outdated and don’t meet OSHA’s modified Hazard Communication Standard (HCS). The HCS guideline in turn conforms to the United Nations’ Globally Harmonized System of Classification and Labeling of Chemicals (GHS). Given that compliance stakeholders must sometimes manage hundreds of SDSs for their product inventory, then, HCS and GHS guidelines can easily get overlooked and be cited as an EPA report violation. 

Worse than a reporting violation, outdated Safety Data Sheets can put first responders and communities in danger when the latest safety information for hazardous chemicals isn’t fully made available.

But a much worse consequence is that out-of-date SDSs can put first responders and local communities in danger when the latest safety information for hazardous chemicals isn’t fully made available. Fortunately, EHS-based technology can now actually extract and update the information in SDSs to ensure the information they contain is accurate. 

Other common errors in EPA reports that can lead to violations 

Outdated and insufficient SDSs are just one of many common Tier II reporting errors EHS teams encounter every year. For program areas like EPCRA and RCRA, such errors often result from having to interpret EPA reporting requirements that change constantly — especially at the state and local level — or that aren’t always clear to begin with. A good example is how to report mixtures for lead-acid batteries and the confusion it can lead to. 

A lack of visibility

Another root cause of reporting errors is not having adequate visibility into information and compliance data. Along with SDSs, for example, errors in chemical inventory lists and reporting thresholds can easily go undetected if not monitored regularly. Outdated emergency contact and site plan info at facilities likewise often goes undetected until it’s pointed out in an EPA notice of violation. Like outdated SDSs in the event of a disaster, not being able to reach an emergency contact or knowing where hazardous chemicals are stored at a site can put first responders at risk. 

The EPA reportable quantity list

Other frequent errors can be traced to the EPA reportable quantity list, commonly known as the List of Lists, for chemicals reported under EPCRA, the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and the Clean Air Act (CAA). One common issue stemming from the list is that businesses incorrectly mark chemicals as extremely hazardous substances (EHSs). Here again, a lack of visibility into chemical inventories can result in chemicals being mislabeled or miscounted by way of quantity. 

Further, especially in distributed companies, chemicals often tend to get reported inconsistently across facilities, leaving chemical inventories to get reported inaccurately. By digitizing data for chemical lists, inventories, threshold quantities and so on, compliance leaders and EHS teams can more effectively manage their product inventory and properly identify chemicals to avoid non-compliance violations. 

Or, as was the case in the following EPA violation, a company can simply fail to report certain chemicals when required.

EPA violation fines and settlements: One recent example

In one recent example of EPA cases and settlements, the agency took action against a chemical warehousing company in June 2022 for “unsafe practices and inadequate reporting.” Environmental complaints in the case centered on “alleged” violations of both the CAA’s General Duty Clause (GDC) and EPCRA requirements for reporting years 2019 and 2020. (The recurring reporting violations likely did not sit well with EPA inspectors.)

Specifically, the warehousing company failed to report several EHSs under EPCRA Section 311 and 312 chemical inventory reporting requirements, and in line with CAA GDC requirements applicable to “sources producing, processing, handling, or storing EHSs.” As part of the EPA settlement, the company agreed to pay a penalty of $109,635, and to certify compliance with all of its CAA GDC and EPCRA requirements under the watchful eye of the EPA. The company also likely damaged its reputation — as a business, as a member of the community, and as a steward of the environment. 

Could more proactive environmental compliance reporting processes and guardrails like data visibility and automated regulatory alerts have helped prevent this particular EPA case? Most likely, yes. And as far as EPA violation fines go, the six-figure penalty in this case was steep, but not uncommon.

Are EPA violations getting more costly? 

In a compliance snapshot of EPA reports and non-compliance violations from Q4 2020, 150 settlement agreements for EPA violations cases resulted in total financial penalties of nearly $4.6 million for the timeframe. Most notable among them was one fuel distribution company that was fined more than $1.3 million when it violated the EPCRA Section 313 Toxics Release Inventory (TRI) and “failed to report the releases of several TRI-listed chemicals at its terminals, denying the public access to this information.” Yet again, such a failure put first responders and the nearby area at risk.  

Are steeper financial punishments like this warranted for companies that get cited for an EPA report violation? That’s really up to the Environmental Protection Agency administrators. But in the instance of the chemical warehousing company that failed to meet its EPCRA obligations, at least, the nearly $110,000 penalty they paid was part of a new EPA commandment.   

As EPA New England Regional Administrator David W. Cash put it, “EPA was particularly concerned that emergency responders were not provided adequate information about the type and amount of chemicals stored on site, and that the facility is located in an area with environmental justice concerns.

“With this settlement, EPA is sending a strong message to companies that deal with dangerous chemicals — they have an obligation to comply with environmental laws in order to protect the communities around them.” 

Congress enacted EPCRA almost 40 years ago to protect local communities and emergency responders from potential accidents at facilities that manufacture, store, distribute or use hazardous chemicals. That’s why environmental compliance reporting has mattered since then, and still matters now.

Transforming the way enterprises stay in compliance 

Encamp is on a mission to create a world where good for business can equal good for the environment. We help enterprises transform compliance programs and human processes into a technology-driven system that lays the foundation for accurate and ongoing environmental compliance through a blended method of intelligent high-tech solutions and high-touch expert support.

The U.S. Environmental Protection Agency (EPA) was established more than 50 years ago for a reason. And yet we continue to see reports of environmental non-compliance and serious violations of EPA rules on a routine basis, especially for hazardous materials and waste streams. 

But it’s even more troubling to read stories in which companies flagrantly ignore regulatory requirements. For whatever reasons, they choose to take a path of risk and not one of proactive environmental compliance management that could save them a lot of financial pain and PR headaches. 

Three of Many Non-Compliance Cases

The following accounts of environmental non-compliance — and the risk and consequences that come with it — are just three that have hit the newswire halfway through 2021. And trust us, there are many more stories just like these.  

“Ohio industrial company accused of illegally storing hazardous waste”

What a way to start this article from Waste Today magazine. “Arrest warrants have been issued for the operators of an industrial plating company who were accused of illegally storing tens of thousands of pounds of hazardous waste in the company’s rundown building….” (We added the italics for emphasis.)

As reported, the business fell into financial ruin years ago and the site has since been targeted for cleanup by the state and federal EPA. While records show the violations as being linked to the site’s previous operator, they’ve “mostly gone uncorrected for years.” For one example of environmental non-compliance, Ohio EPA investigators found at least 38,000 pounds of hazardous waste, some of which had been at the site since 2016.

Among the full findings identified in the EPA’s April 28, 2021 notice of violation were these other infractions:

When consequences run deeper than just financial penalties

Many of the chemicals and heavy metals found at this facility are on the EPA’s List of Lists and are subject to regulatory requirements for EPCRA, CERCLA, RCRA, and Section 112(r) of the Clean Air Act. And even though the violations were linked to the site’s previous operator, this company and its operators should have known they were in violation and risked substantial fines and a lost reputation for their business. 

But is it worth going to jail? No, it isn’t.  

“EPA Uses Emergency Powers to Protect St. Croix Communities and Orders Limetree Bay Refinery to Pause Operations” 

An environmental non-compliance action is pretty serious when EPA officials pull out the agency’s “Emergency Powers.” It’s worse when they announce it in an EPA News Release (which was published in the Washington Post). But it’s really bad when EPA suspends a business’s operations for 60 days, and possibly longer. Yet that’s what EPA did to protect public health.

So what are the alleged violations? According to EPA, since February of 2021, the Limetree Bay refinery experienced “multiple major mishaps resulting in significant air pollutant and oil releases.” Not a single mishap, mind you, but multiple violations over a roughly 3-month period.

According to the EPA release (condensed here): “Under its legal authorities in Clean Air Act Section 303, EPA may take this urgent measure when an entity’s actions are substantially endangering public health, welfare, or the environment. Limetree Bay’s repeated incidents raise significant environmental justice concerns, which are a priority for EPA.

EPA Administrator Michael S. Regan had this to say in the news release (condensed again): “These repeated incidents have been and remain totally unacceptable. Today, I have ordered the refinery to immediately pause all operations until we can be assured they can operate in accordance with laws that protect public health. EPA will not hesitate to use its authority to enforce the law and protect people from dangerous pollution where they work, live, and play.”

Two strikes: Losing business, and being under continued EPA watch

In April 2021, EPA issued a notice of violation to Limetree Bay for alleged violations of the Clean Air Act. No fines were issued at the time, but pursuant to the Clean Air Act, the order to pause operations was to remain in effect for 60 days — unless extended through the United States’ filing of a civil action in court. 

Any business operation shutting down for 60 days — or more — is never good for revenue. In this case, a potential civil action also no doubt puts the business in serious litigation mode and reputational damage control, meaning more costs for legal fees and PR. But a scarier outcome is knowing you’ll forever be under the watchful eye of EPA for further violations and environmental non-compliance.     

“Seafood processor agrees to pay $220,000 penalty for ammonia violations”

So yet another violation of the Clean Air Act and EPCRA, and this time the penalty for environmental non-compliance was a direct hit in the pocketbook. As Cooling Post reported in May 2021, Northern Pelagic Group (NorPel) agreed to pay a $220,000 penalty for alleged violations regarding its ammonia refrigeration system at its New Bedford, Massachusetts, seafood processing facility. 

Specifically, NorPel violated the chemical accident prevention requirements of the federal CAA, as well as the hazardous chemical reporting requirements under EPCRA. EPA also alleged that the company failed to file a risk management plan (RMP) with EPA. RMPs are required for facilities that manage, maintain or produce hazardous chemicals requiring stringent management to ensure public safety. 

EPA further alleged that “the company had not adequately designed, operated, or maintained its refrigeration system,” and that NorPel failed to file its annual EPCRA Tier II chemical inventory report for the 2015 reporting year with state and local emergency response authorities.

Has risk management become marginalized?

This comes from a blog thread on bayt.com about compliance and risk management and if there’s a difference between them. The following response is from Rajesh Dhuri, a senior manager of a communications services company — which obviously isn’t EHS, although his answer is relevant. And thought provoking.

Dhuri’s opinion is that compliance and risk management are interrelated, but not the same. “Compliance management is managing the process to meet all regulatory and legislative requirements,” he says. “Managing risk is not just about assessing and quantifying all the things that could go wrong,” Dhuri adds, “but, perhaps more importantly, about understanding all the things that need to go right for the enterprise to be successful.

“Somehow we have descended into a culture focused on ferreting out all the issues that could contribute to failure to the point where risk management has become marginalized as overhead to the business process, not a contributor to its success.”

Unfortunately and all too often, companies view compliance and risk management through the same misguided lens — as a cost of doing business. 

Let Encamp help

After receiving arrest warrants, paying six-figure fines, and knowing EPA continually has your business on its radar, one would think companies would be more serious about managing the risk of environmental non-compliance. Mitigating risk and non-compliance is one of the reasons we started Encamp

Our mission, after all, is to create a world where good for business equals good for the environment. And we’re pursuing this mission with an end-to-end environmental compliance software platform — the Encamp platform — that enables companies to proactively manage risk related to regulatory reporting. 

With Encamp, our customers are able to aggregate and centralize environmental compliance data for better visibility and easier access. They also streamline workflows for EPCRA 312/Tier II compliance reporting and automate the submissions of report filings and payments to agencies in all 50 states.

Ongoing, we continue to build this premier platform so EHS professionals everywhere can ensure that environmental non-compliance is never an issue.  

Transforming the way enterprises stay in compliance 

Encamp is on a mission to create a world where good for business can equal good for the environment. We help enterprises transform compliance programs and human processes into a technology-driven system that lays the foundation for accurate and ongoing environmental compliance through a blended method of intelligent high-tech solutions and high-touch expert support.

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