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USEPA Announces Policy of Enforcement Discretion Related to COVID-19 Crisis

Energy, Environment & Natural Resources Jeremy A. Lite, Cynthia A. Faur, Jacqueline M. Vidmar, Lauren R. Harpke, Michael S. Mostow

In these uncertain times, business are being called upon to continue essential operations. In some instances, manufacturing facilities need to increase production or are evaluating production of different products to meet community needs during the COVID-19 pandemic. In other instances, businesses are evaluating how to meet environmental compliance obligations with a skeleton staff. To proactively address some of these challenges, on March 26, 2020, the United States Environmental Protection Agency (EPA) announced a temporary policy of enforcement discretion for certain compliance failures resulting from worker shortages, travel and social distancing restrictions, and other consequences of the pandemic. While this is a welcome step from EPA, businesses should be wary because this temporary policy does not fully address the most complex issues manufacturing facilities may face in the coming weeks.

EPA’s Temporary Policy

Under the temporary policy, EPA promises to exercise enforcement discretion for a number of routine environmental compliance obligations. The temporary policy takes immediate effect and is retroactive to compliance failures occurring from March 13, 2020, onward. EPA has indicated that the policy will remain in effect until it is withdrawn and has promised to provide at least seven days advance notice prior to termination. Among the highlights of EPA's temporary policy are:

  • As a general statement of policy, EPA announced that it "does not expect to seek penalties for violations of routine compliance monitoring, integrity testing, sampling, laboratory analysis, training, and reporting or certification obligations in situations where the EPA agrees that COVID-19 was the cause of the noncompliance and the entity provides supporting documentation."
  • Regulated entities must make "every effort to comply" with their environmental obligations despite disruptions. EPA has made it clear that intentional disregard for the law or noncompliance that is not legitimately caused by COVID-19-related delays are not entitled to enforcement discretion.
  • In instances when compliance cannot be achieved, EPA has adopted a "not reasonably practicable" standard and requires certain measures to be taken. To qualify for enforcement discretion, entities must act to minimize the effects and duration of noncompliance caused by COVID-19 and must identify to the agency how COVID-19 was the cause of noncompliance. Such causes might include, among other things, absence of critical personnel, delays in laboratory analysis and reports, and limitations on site access by tenants or other occupants. In addition, the nature and dates of the compliance failures must be documented and efforts made to return to compliance as quickly as safely possible.
  • For missed monitoring and reporting deadlines with compliance intervals of less than three months, EPA does not expect to require "catch-up" monitoring events. However, for monitoring events with less frequent intervals, the affected entity is directed to resume compliance as soon as possible and to conduct late monitoring or submit late reports if necessary.
  • Where facilities exceed applicable limitations due to failure of air pollution control equipment or wastewater or waste treatment equipment, such failure should be expeditiously reported to the applicable permitting authority. EPA and the permitting authority will then consult as to whether an enforcement response is appropriate given the risks posed by the exceedance and the circumstances that led to the exceedance, including the COVID-19 pandemic.
  • Recognizing that working remotely may inhibit compliance with "wet" signature requirements, the agency will accept digital or electronic signatures even when a wet signature would normally be required. Under the temporary policy, it will also accept emailed submissions when a paper original is normally required.
  • The policy of enforcement discretion also applies to compliance obligations imposed by administrative settlement agreements and consent decrees, to the extent possible. Entities operating under settlement agreements or consent decrees are directed to use the notice procedures spelled out in those documents to notify the agency of COVID-19-related compliance issues.
  • In instances where a hazardous waste generator is temporarily unable to transfer waste off-site because of pandemic-related disruptions, EPA may exercise discretion not to treat the entity as a treatment, storage, or disposal facility, provided the entity takes all measures necessary to properly label and store the waste until it can be moved. Thus, generators may maintain generator status, and small quantity generators may maintain such designation, even if the amount of hazardous waste stored on site exceeds a regulatory threshold because it cannot be picked up.
  • Similarly, EPA offers relief to animal feeding operations, which may maintain present designations even if the inability to transfer animals off-site as a result of COVID-19 would cause the facility to reach a different classification.
  • For accidental releases of oil, hazardous substances, chemicals, or waste, EPA continues to require prompt response in accordance with the law and is not offering enforcement discretion for such releases.
  • Facilities that are essential critical infrastructure, as determined by guidance issued by the Cybersecurity and Infrastructure Security Agency, may be able to obtain a No Action Assurance Letter related to environmental compliance to the extent issuance of the letter is in the public interest and the letter contains conditions to protect the public. Determinations of whether No Action Assurance letters are warranted will be made on a case-by-case basis.
  • EPA will focus its resources on acute and imminent threats to public health and the environmental during the COVID-19 pandemic. All ongoing enforcement matters will continue.
  • "EPA expects full compliance" when the crisis has passed and the policy is no longer in effect.
  • This policy does not apply to Superfund or RCRA Corrective Action enforcements. EPA is preparing a separate memorandum regarding Superfund/RCRA Corrective Action compliance.

Practical Tips for Business

By issuing a formal policy of enforcement discretion, EPA has offered real relief to manufacturers struggling to maintain business operations and to meet routine compliance requirements during this crisis. Nothing about this situation, however, is routine, and many business are being called upon to increase production of critically needed materials or to change their process to produce equipment or products that were not previously manufactured at a particular facility. Additionally, facilities may encounter supply chain interruptions that limit their ability to fully operate pollution controls, thereby impacting their ability to meet permit limitations. Unfortunately, this policy does not ensure that enforcement discretion will be applied by EPA or the states in these situations.

Noted above, facilities that are essential critical infrastructure may be able to obtain a No Action Assurance letter from EPA related to environmental compliance. Obtaining such a letter, however, may be time consuming and production needs could be immediate. Additionally, not all manufacturing facilities may be deemed essential critical infrastructure.

Businesses should consider the following proactive steps to minimize the risk of federal or state enforcement for matters where enforcement discretion is not expressly provided by the guidance:

  • Review your permits to verify whether anticipated production increases or process changes can be accommodated.
  • Reach out to your permitting authority to discuss environmental compliance concerns or required permit revisions.
    • Some state agencies, like the Arizona Department of Environmental Quality, have announced that they will implement a policy of enforcement discretion to align with EPA's. Other state agencies, like the Illinois Environmental Protection Agency, are currently applying enforcement discretion on a case-by-case basis.
  • Consider your supply chain and the availability of alternative supplies for materials needed for environmental compliance.

Companies should also work with their internal environmental team to identify employees that can take on new or additional responsibilities in the event of staff unavailability during the COVID-19 pandemic. Staff will be needed not only to meet environmental compliance requirements, but also to maintain the information required by EPA’s temporary policy to better ensure the exercise of enforcement discretion.

Finally, companies should anticipate any operational changes that may be necessary or desirable once the crisis subsides, including an increase in production. If these changes cannot occur under current permitting restraints, consider starting the permit revision process as soon as possible.

EPA's policy, and the aligning policies of state environmental agencies, may have significant implications for your facility in the event of compliance disruptions caused by COVID-19. The entire policy is available here: https://www.epa.gov/enforcement/covid-19-implications-epas-enforcement-and-compliance-assurance-program.

If you have questions about how this policy may affect your operations, please contact your Quarles & Brady attorney or: