EPA’s Renewed Emphasis on Self-Disclosed Violation Policies

EPA recently announced its renewed emphasis on encouraging regulated entities to voluntarily discover, promptly disclose, expeditiously correct, and take steps to prevent recurrence of environmental violations. Specifically, EPA is taking steps to enhance and promote the eDisclosure program and to encourage new owners to take advantage of opportunities to increase compliance through reliance on existing self-disclosure policies.

eDisclosure: In the last two years, EPA has seen a 75% increase in voluntary disclosures with large and small companies taking advantage of the centralized web-based portal to receive and automatically process self-disclosed civil environmental violations. The portal may not be used for CERCLA 103/EPCRA 304 incidents, EPCRA violations with significant economic benefit or criminal matters.

New Owner Audit Policy: Since 2008, EPA has offered additional flexibility and incentives to new owners that want to make a “clean start” at their newly acquired facilities. New owners, defined as within nine months of acquisition, may enter into audit agreements or otherwise benefit from a waiver of economic benefit penalties and a more generous application of the “voluntary” discovery provision.

Additional insights into self-disclosed violations include:

–EPCRA violations make up the largest percentage of self-disclosures

–Use of the eDisclosure portal allows for immediate feedback either in the form of an electronic Notice of Determination (eNOD) or an electronic Acknowledgement Letter (AL)

–Parties seeking to benefit from the New Owner Policy should consider submitting a traditional written disclosure since the eDisclosure portal was not designed to apply the New Owner Policy incentives.

While many remain skeptical of self-disclosures, both the eDisclosure program and the New Owner Policy may provide meaningful options to come into compliance depending upon the nature of the suspected violation and the circumstances surrounding the discovery of the concern. EPA’s renewed focus on self-disclosed violations is a positive development for business.

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