Environmental Protection
EPA-State Enforcement Partnership Has Improved, but EPA's Oversight Needs Further Enhancement Gao ID: GAO-07-883 July 31, 2007The Environmental Protection Agency (EPA) enforces the nation's environmental laws through its Office of Enforcement and Compliance Assurance (OECA). OECA sets overall enforcement policies and through its 10 regions oversees state agencies authorized to implement environmental programs consistent with federal requirements. GAO was asked to (1) identify trends in federal resources to regions and states for enforcement between 1997 and 2006, and determine regions' and states' views on the adequacy of these resources; (2) determine EPA's progress in improving priority setting and enforcement planning with states; and (3) examine EPA's efforts to improve oversight of states' enforcement programs and identify additional actions EPA could take to ensure more consistent state performance and oversight. GAO examined information from all 10 regions and 10 authorized states, among other things.
Overall funding to regions and authorized states increased from 1997 through 2006, but these increases did not keep pace with inflation and the growth in enforcement responsibilities. Over the 10-year period, EPA's enforcement funding to the regions decreased 8 percent in inflation-adjusted terms. Regional officials said they reduced the number of enforcement staff by about 5 percent. EPA's grants to states to implement federal environmental programs also declined by 9 percent in inflation-adjusted terms while enforcement and other environmental program responsibilities increased. According to state officials, reductions in grant funds have limited their ability to meet EPA's requests to implement new requirements. For example, according to New York State officials responsible for the hazardous waste program, a reduction in EPA grants between 1997 and 2006 has meant a 38 percent reduction in the full-time state staff supported by federal funding for this program. However, EPA information on the workload and staffing needs of its regions and the states is incomplete, and, thus, it is not possible with existing data to determine their overall capacity to meet their enforcement responsibilities. EPA has made substantial progress in improving priority setting and enforcement planning with states through its system for setting national enforcement priorities and the EPA/state National Environmental Partnership System (NEPPS), which have fostered a more cooperative relationship. For example, on states' recommendation, OECA accepted as a priority ensuring that facilities handling hazardous substances, such as lead or mercury, have the financial resources to close their facilities, clean up contamination, and compensate communities and individuals affected by the contamination. EPA and states have also made some progress in using NEPPS for joint planning and resource allocation. State participation in the partnership grew from 6 pilot states in fiscal year 1996 to 41 states in fiscal year 2006. EPA has improved its oversight of state enforcement programs by implementing the State Review Framework (SRF) as a means to perform a consistent approach for overseeing the programs. Moreover, EPA can make additional progress by addressing weaknesses that the SRF reviews identified and by implementing other improvements to ensure oversight that is more consistent. For example, the SRF reviews show that EPA has limited ability to determine whether the states are performing timely, appropriate enforcement and whether penalties are applied to environmental violators in a fair and consistent manner within and among the states. In addition, GAO noted that EPA could make further use of the SRF to (1) determine the root causes of poorly performing programs; (2) inform the public about how well the states are implementing their enforcement responsibilities; and (3) extend the use of the SRF methodology to assess the performance of EPA's regions, which have been inconsistent in their enforcement and oversight efforts.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-07-883, Environmental Protection: EPA-State Enforcement Partnership Has Improved, but EPA's Oversight Needs Further Enhancement
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Report to Congressional Requesters:
United States Government Accountability Office:
GAO:
July 2007:
Environmental Protection:
EPA-State Enforcement Partnership Has Improved, but EPA's Oversight
Needs Further Enhancement:
EPA-State Enforcement:
GAO-07-883:
GAO Highlights:
Highlights of GAO-07-883, a report to congressional requesters
Why GAO Did This Study:
The Environmental Protection Agency (EPA) enforces the nation‘s
environmental laws through its Office of Enforcement and Compliance
Assurance (OECA). OECA sets overall enforcement policies and through
its 10 regions oversees state agencies authorized to implement
environmental programs consistent with federal requirements. GAO was
asked to (1) identify trends in federal resources to regions and states
for enforcement between 1997 and 2006, and determine regions‘ and
states‘ views on the adequacy of these resources; (2) determine EPA‘s
progress in improving priority setting and enforcement planning with
states; and (3) examine EPA‘s efforts to improve oversight of states‘
enforcement programs and identify additional actions EPA could take to
ensure more consistent state performance and oversight. GAO examined
information from all 10 regions and 10 authorized states, among other
things.
What GAO Found:
Overall funding to regions and authorized states increased from 1997
through 2006, but these increases did not keep pace with inflation and
the growth in enforcement responsibilities. Over the 10-year period,
EPA‘s enforcement funding to the regions decreased 8 percent in
inflation-adjusted terms. Regional officials said they reduced the
number of enforcement staff by about 5 percent. EPA‘s grants to states
to implement federal environmental programs also declined by 9 percent
in inflation-adjusted terms while enforcement and other environmental
program responsibilities increased. According to state officials,
reductions in grant funds have limited their ability to meet EPA‘s
requests to implement new requirements. For example, according to New
York State officials responsible for the hazardous waste program, a
reduction in EPA grants between 1997 and 2006 has meant a 38 percent
reduction in the full-time state staff supported by federal funding for
this program. However, EPA information on the workload and staffing
needs of its regions and the states is incomplete, and, thus, it is not
possible with existing data to determine their overall capacity to meet
their enforcement responsibilities.
EPA has made substantial progress in improving priority setting and
enforcement planning with states through its system for setting
national enforcement priorities and the EPA/state National
Environmental Partnership System (NEPPS), which have fostered a more
cooperative relationship. For example, on states‘ recommendation, OECA
accepted as a priority ensuring that facilities handling hazardous
substances, such as lead or mercury, have the financial resources to
close their facilities, clean up contamination, and compensate
communities and individuals affected by the contamination. EPA and
states have also made some progress in using NEPPS for joint planning
and resource allocation. State participation in the partnership grew
from 6 pilot states in fiscal year 1996 to 41 states in fiscal year
2006.
EPA has improved its oversight of state enforcement programs by
implementing the State Review Framework (SRF) as a means to perform a
consistent approach for overseeing the programs. Moreover, EPA can make
additional progress by addressing weaknesses that the SRF reviews
identified and by implementing other improvements to ensure oversight
that is more consistent. For example, the SRF reviews show that EPA has
limited ability to determine whether the states are performing timely,
appropriate enforcement and whether penalties are applied to
environmental violators in a fair and consistent manner within and
among the states. In addition, GAO noted that EPA could make further
use of the SRF to (1) determine the root causes of poorly performing
programs; (2) inform the public about how well the states are
implementing their enforcement responsibilities; and (3) extend the use
of the SRF methodology to assess the performance of EPA‘s regions,
which have been inconsistent in their enforcement and oversight
efforts.
What GAO Recommends:
GAO recommends that EPA (1) develop an action plan to address problems
identified in state programs, (2) evaluate the capacity of state
programs to enforce authorized programs, (3) publish findings of state
enforcement program reviews, and (4) assess the performance of its 10
regions. EPA generally agreed with GAO‘s recommendations, but stated it
will decide whether to publish future state reviews when it evaluates
the review process in fiscal year 2008.
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-883].
To view the full product, including the scope and methodology, click on
the link above. For more information, contact John B. Stephenson at
(202) 512-6225 or stephensonj@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Increases in EPA Funding Have Not Kept Pace with Inflation and
Enforcement Responsibilities:
EPA and States Have Taken Steps to Improve Planning and Priority
Setting for Enforcement, but Results Are Uneven:
State Review Framework Has the Potential to Provide More Consistent
Oversight:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Scope and Methodology:
Appendix II: Development and Implementation of the State Review
Framework:
Appendix III: Comments from the Environmental Agency:
Appendix IVGAO Contact and Staff Acknowledgments:
Table:
Table 1: EPA's Candidate and Final National Enforcement Priorities for
Fiscal Years 2005-2007, in Rank Order:
Figures:
Figure 1: EPA's Enforcement Funding in Real Terms, in Total, and by
Headquarters and Regional Offices, Fiscal Years 1997-2006:
Figure 2: OECA Headquarters and Regional Total FTEs, Fiscal Years 1997-
2006:
Figure 3: OECA Regional Offices FTEs, Fiscal Years 1997-2006:
Figure 4: EPA's Real Total Funding and Real Total Grant Funding to
States and Tribes, Fiscal Years 1997 through 2006:
Abbreviations:
EPA: Environmental Protection Agency:
ECOS: Environmental Council of the States:
FTE: Full-Time equivalent:
NEPPS: National Environmental Partnership System:
NYSDEC: New York State Department of Environmental Conservation:
OECA: Office of Enforcement and Compliance Assurance:
PPA: Performance Partnership Agreement:
PPG: Performance Partnership Grant:
RCRA: Resource Conservation and Recovery Act:
SRF: State Review Framework:
UST: Underground Storage Tank:
United States Government Accountability Office:
Washington, DC 20548:
July 31, 2007:
The Honorable Norman D. Dicks:
Chairman:
The Honorable Todd Tiahrt:
Ranking Member:
Subcommittee on Interior, Environment
and Related Agencies:
Committee on Appropriations House of Representatives:
The Honorable James M. Inhofe:
Ranking Member:
Committee on Environment and Public Works:
United States Senate:
The Environmental Protection Agency (EPA), in partnership with state
agencies, oversees compliance with 44 separate environmental programs.
These programs regulate facilities--such as sewage treatment plants,
petroleum refineries, and power plants--whose operations could pollute
the air, water, and land, and thereby endanger public health and the
environment. EPA and its regulatory partners are responsible for
ensuring that these regulated facilities comply with program
requirements and taking enforcement action in instances of
noncompliance. These enforcement efforts are important for ensuring a
level playing field because, among other things, facilities that do not
comply with program requirements might have a competitive economic
advantage over facilities that take environmental requirements
seriously and thereby incur additional operational costs.
Many federal environmental statutes, such as the Clean Air Act, the
Clean Water Act, and the Solid Waste Disposal Act, direct EPA to
approve or authorize qualified states to implement and enforce
environmental programs consistent with federal requirements. EPA
expects its 10 regional offices to take a systematic, consistent
approach in overseeing the state enforcement programs and, in doing so,
to follow EPA's regulations, policies, and guidance. EPA outlines, by
policy and guidance, its oversight expectations for regional offices
with regard to ensuring the state approaches include the elements of an
acceptable state enforcement program, such as the type and timing of
the actions that should be taken for various violations, and track how
well the states comply.
This model of state enforcement of environmental laws, accompanied by
EPA's regional oversight, allows the level of government closest to
environmental conditions to assume primary responsibility for
implementing programs. But it requires that states acquire and maintain
adequate capacity to enforce state environmental programs that are
consistent with federal requirements and act in a timely and
appropriate manner to ensure violators come into compliance. EPA
establishes by regulation the requirements for state enforcement
authority, such as the authority to seek civil and criminal penalties
and injunctive relief.[Footnote 1] EPA grants authorization to the
states on a program-by-program basis. EPA policy and guidance outline,
with greater specificity, the elements of an acceptable state
enforcement program--such as the necessary legislative authorities and
the type and timing of the enforcement actions for various violations-
-and track how well states comply.
Most states have responsibility for multiple EPA programs. EPA-
authorized states monitor the compliance of regulated facilities by
conducting inspections, performing evaluations, and reviewing records
to verify facilities' compliance with programs regulating the discharge
of pollutants into surface water or the air and the storage and
disposal of hazardous waste. States are expected to pursue enforcement
actions against those facilities found in noncompliance and to report
their actions to EPA.
EPA administers its environmental enforcement responsibilities through
its headquarters Office of Enforcement and Compliance Assurance (OECA).
OECA monitors the compliance of regulated facilities, identifies
national enforcement concerns and sets priorities, and provides overall
direction on enforcement policies. While OECA headquarters occasionally
takes direct enforcement action, much of EPA's enforcement
responsibilities are carried out by its 10 regional offices. These
offices are responsible for carrying out core program activities under
each of the major federal environmental statutes, as well as
significant involvement in implementing EPA's national enforcement
priorities and taking direct enforcement action. The regions are also
responsible for overseeing authorized states' enforcement programs,
implementing programs in Indian country[Footnote 2] and states that are
not authorized for particular programs. OECA also expects regions and
authorized states to establish enforcement priorities and expectations
and reach agreement on their respective roles and responsibilities.
Authorized states may also receive EPA grants to assist in implementing
and enforcing authorized programs. In fiscal year 2006, grants to
states and tribes totaled $3.2 billion, or about 42 percent of EPA's
total budget.
Over the years, states have increased their inspection and enforcement
activities. As a result, EPA regional offices are now more actively
involved in conducting oversight and providing states with guidance,
training, and technical assistance to assure consistent performance of
state enforcement programs. If EPA finds a state is not adequately
administering or enforcing authorized programs, individual
environmental statutes may authorize EPA to take certain actions,
including providing additional technical assistance, conditioning the
receipt of grant funds on compliance with EPA guidance, or withdrawing
state authorization. In addition, when EPA finds a specific state
enforcement action to be inadequate, the agency may take federal
enforcement action against the violator.
Despite the interdependence between EPA and the states in carrying out
enforcement responsibilities, effective working relationships have
historically been difficult to establish and maintain, as we, EPA's
Office of Inspector General, the National Academy of Public
Administration, and others have reported.[Footnote 3] The following
three key issues have affected EPA-state relationships:
* EPA's funding allocations to the states have not fully reflected the
differences among the states' enforcement workload and their relative
ability to enforce state environmental programs consistent with federal
requirements. In this regard, EPA lacks information on the capacity of
both the states and EPA's regions to effectively carry out their
enforcement programs, because the agency has done little to assess the
overall enforcement workload of the states and regions and the number
and skills of people needed to implement enforcement tasks, duties, and
responsibilities. Furthermore, the states' capacity continues to evolve
as they assume a greater role in the day-to-day management of
enforcement activities, workload changes occur as a result of new
environmental legislation, new technologies are introduced, and state
populations shift.
* Problems in EPA's enforcement planning and priority setting processes
have resulted in misunderstandings between OECA, regional offices, and
the states regarding their respective enforcement roles,
responsibilities, and priorities. States have raised concerns that EPA
sometimes "micromanages" state programs without explaining its reasons
for doing so and often does not adequately consult the states before
making decisions affecting them.
* OECA has not established a consistent national strategy for
overseeing states' enforcement of EPA programs. Consequently, the
regional offices have not been consistent in how they oversee the
states. Some regional offices conducted more in-depth state reviews
than others, and states in these regions have raised concerns that
their regulated facilities are held to differing standards of
compliance than facilities in states located in other regions.
EPA and leaders of state environmental programs have tried over the
years to establish new mechanisms to address each of these long-
standing problems in order to strengthen the EPA-state partnership. For
example, EPA has linked its budgeting and allocation process to its
strategic goals and objectives, and makes strategic decisions in
developing its budget for its enforcement workforce to reflect shifting
priorities. Nonetheless, according to OECA officials, shifts in funding
and staff years made as a result of changing priorities are generally
marginal. In this regard, in July 2005 we reported that an effective
workforce strategy is needed, particularly during times of fiscal
constraint, so that OECA can tailor workforce changes to reflect actual
conditions in the regions and states and minimize potential adverse
impacts on EPA's programs.[Footnote 4]
To better clarify roles, responsibilities, and priorities between EPA
and the states, the agency established the National Environmental
Performance Partnership System (NEPPS) in 1995 to give states
demonstrating strong environmental performance greater flexibility and
autonomy in planning and operating their environmental programs. Under
this system, a state and EPA may enter into a Performance Partnership
Agreement (PPA) that identifies the state's environmental goals and
priorities, and spells out how EPA and state officials are to address
them. States may also ask to combine EPA grants into a Performance
Partnership Grant (PPG), which is intended to allow the state greater
flexibility in targeting limited resources to meet its priorities. In
2003, OECA revised its process for setting national enforcement
priorities to better consider the views of states and regions and to
more effectively target enforcement resources. Under the new process,
OECA headquarters evaluates the overall environmental performance of
individual industrial sectors, and solicits views about those sectors
from states and regions, the representatives of the industrial sectors,
and the public. OECA uses this information to identify priorities that
are best addressed through focused federal attention. OECA issues
guidance to the regions and states for implementing the national
enforcement priorities, as well as guidance for deterring noncompliance
among all regulated sectors.
Likewise, OECA implemented a new oversight program in 2004, known as
the State Review Framework (SRF), to more uniformly and objectively
measure the performance of states' enforcement programs. Under SRF,
regions evaluate the extent to which state performance in managing
three major programs complies with specific legal requirements, policy,
and guidance, while OECA headquarters manages the overall review
process.[Footnote 5] In conducting this evaluation, the regions use 12
review elements, such as the degree to which states complete planned
inspections, accurately identify significant violations, and take
timely and appropriate enforcement action. As of January 2007, EPA had
conducted SRF reviews in 33 states and expected to complete its
assessment of the remaining states by the end of fiscal year 2007. EPA
plans to evaluate the implementation of SRF in fiscal year 2008.
Appendix II contains a detailed description of the development of the
SRF.
In this context, you asked that we (1) identify trends in the federal
resources provided to regions and states for enforcement between 1997
and 2006, and determine regional and states' views on the adequacy of
these resources to implement their activities; (2) determine EPA's
progress in improving priority setting and enforcement planning with
its regions and authorized states; and (3) examine EPA's efforts to
improve its oversight of state's enforcement and compliance programs
and identify additional actions that could be taken to ensure more
consistent state performance and more consistent oversight of state
programs.
To address these issues, we reviewed EPA's strategic plans and national
strategy, and its policy and guidance for planning and implementing its
enforcement programs and for establishing performance partnerships with
authorized state agencies.[Footnote 6] We also examined the budgets for
EPA and OECA for fiscal years 1997 through 2006. We discussed the
development and implementation of national strategy, policy, guidance,
and resource allocation with officials of OECA, EPA's Office of
Congressional and Intergovernmental Relations, EPA's Office of Chief
Financial Officer, and officials responsible for state program
oversight in each of EPA's 10 regional offices. In each region, we
examined regional strategic plans, partnership agreements with
authorized states, and state oversight reviews. We used semi-structured
interviews to elicit, organize, and evaluate narrative responses from
officials at the 10 regional offices and 10 authorized state agencies.
We selected one state from each region: five states that had
performance partnership agreements with EPA (Iowa, Massachusetts,
Minnesota, Oregon, and Utah) and five that did not (Arizona, Arkansas,
Florida, New York, and West Virginia). At these state agencies, we
reviewed strategic plans and strategy, and policy and guidance for
planning and implementing enforcement programs. We were not able to
assess the workload and capacity of states to meet their programs
because, as mentioned previously, EPA does not have a system to collect
information needed for such an assessment, including consistent and
complete information from the states or regions on their workload and
the number, type, and skills of staff needed to carry out these
responsibilities. Appendix I contains a detailed description of our
scope and methodology. We performed our work from October 2005 through
July 2007 in accordance with generally accepted government auditing
standards, which included an assessment of data reliability and
internal controls.
Results in Brief:
Overall funding to regions and authorized states increased from fiscal
years 1997 through 2006. However, these increases did not keep pace
with inflation and the growth in enforcement responsibilities. Both EPA
and state officials told us they are finding it difficult to respond to
new requirements while carrying out their previous responsibilities.
Over the 10-year period, EPA's enforcement funding to the regions
increased from $288 million in fiscal year 1997 to $322 million in
fiscal year 2006, but declined in real terms by 8 percent. In response,
regional officials said, they reduced the number of enforcement staff
by about 5 percent. EPA's grants to states to implement environmental
programs consistent with federal requirements also increased over the
10-year period, from $2.9 billion in fiscal year 1997 to $3.2 billion
in fiscal year 2006, but declined in real terms by 9 percent. In
addition, grant funding dropped substantially between fiscal years 2004
and 2006, from $3.9 billion to $3.2 billion. These reductions in
funding occurred during a period when statutory and regulatory changes
increased enforcement and other environmental program responsibilities.
As we reported in July 2005, EPA's implementation of amendments to the
Clean Water Act (1) increased the number of regulated industrial and
municipal facilities by an estimated 186,000 facilities and (2) added
hundreds of thousands of construction projects to states' and regions'
workloads for the storm water program. For example, Arkansas officials
said that, for the storm water program in their state, the number of
inspections and storm water permits issued increased by 512 percent
from 2003 to 2005. In addition, other state officials told us that
reductions in grant funds have limited their ability to meet EPA's
requests for their states to carry out new requirements. As a result,
as these officials focus on priority enforcement work, they have
accumulated a backlog of work in other areas, such as renewing permits
for regulated facilities. However, EPA does not collect sufficient
information on enforcement workload and staffing to permit an
independent assessment of the capability of either regions or states to
meet their enforcement responsibilities.
EPA has made substantial progress in improving priority setting and
enforcement planning with states through its system for setting
national enforcement priorities and NEPPS, which have fostered a more
cooperative relationship. With respect to setting national priorities,
for example, stakeholders recommended, and OECA accepted, a focus on
ensuring that facilities handling hazardous substances, such as lead
and mercury, have the financial resources necessary to close their
facilities, clean up any contamination, and compensate communities and
individuals affected by the contamination. Because financial assurance
is now a national priority, EPA will provide training to state
inspectors, who often do not have a financial background, on how to
assess the adequacy of documented financial resources. EPA and states
have also made progress in using NEPPS for establishing enforcement
responsibilities and allocating resources. State participation in the
partnership grew from 6 pilot states in fiscal year 1996 to 41 states
in fiscal year 2006, although the extent of participation in the
partnership varies. Of the 41 states, 31 had both Performance
Partnership Agreements and Performance Partnership Grants; 2 had
agreements only; and 8 had grants only. Participation has been uneven,
according to state officials, because the benefits expected from this
partnership--flexibility in managing their programs and directing grant
funds--have only been partially realized. For example, Minnesota and
Massachusetts officials said they have been able to achieve some
flexibility from EPA to target state priorities and allocate grant
resources to those priorities. Other states, such as Florida and New
York, reported that they did not see significant benefits from
participation in NEPPS. For example, Florida officials told us that
state appropriation procedures restrict their ability to shift
resources among programs.
EPA has improved its oversight of state enforcement programs by
implementing the SRF to provide a consistent approach for overseeing
the programs. Moreover, EPA can make additional progress by addressing
weaknesses that the SRF reviews identified and by implementing other
improvements to ensure oversight that is more consistent. With its
implementation of the SRF, EPA has, for the first time, a consistent
approach for overseeing states' compliance and enforcement programs.
The SRF reviews have also identified several significant weaknesses in
how states enforce program requirements. For example, the reviews
frequently found that states are not properly documenting inspection
findings or penalties, as directed by EPA's enforcement policy and
guidance. While recognizing that these findings are useful, EPA has not
developed a plan for how it will uniformly address them in a timely
manner. Nor has the agency identified the root causes of the
weaknesses, although some EPA and state officials attribute the
weaknesses to causes such as increased workloads concomitant with
budgetary reductions. Until EPA addresses enforcement weaknesses and
their causes, it faces limitations in determining whether states
perform timely and appropriate enforcement and apply penalties to
environmental violators in a fair and consistent manner within and
among the states. The SRF is still in its early stages of
implementation and offers additional uses that EPA has not yet
considered, such as using the SRF's structured approach to (1) provide
consistent information to the public on how well the states are
implementing their enforcement responsibilities and (2) serve as a
basis for assessing the performance of EPA's regions, which have been
inconsistent in their enforcement and oversight efforts in the past.
In order to enhance EPA's oversight of regional and state enforcement
activities consistent with federal requirements, we are recommending
that the Administrator of EPA use the results of the SRF to (1)
identify lessons learned and develop an action plan to address
significant problems; (2) address capacity issues, such as state
staffing levels and workload requirements, of state programs that
perform poorly; (3) publish the results of the SRF so that the general
public and others will know how well state regulators are enforcing
authorized programs; and (4) for regional enforcement programs, conduct
a performance assessment similar to the SRF. In commenting on the draft
report, EPA generally agreed with GAO's recommendations and stated that
the agency is taking action to address the issues we raised. With
respect to our recommendation to publish the results of the SRF
findings, EPA said that it had agreed with the Environmental Council of
the States that the first round of state enforcement reviews would not
be published. However, EPA said it would consider whether to publish
future reviews when it evaluates the implementation of the SRF in
fiscal year 2008.
Background:
Since its creation in 1970, EPA has generally been responsible for
ensuring the enforcement of the nation's environmental laws. This
responsibility has traditionally involved monitoring compliance by
those in the regulated community (such as factories or businesses that
release pollutants into the environment or use hazardous chemicals),
ensuring that violations are properly identified and reported, and
ensuring that timely and appropriate enforcement actions are taken
against violators when necessary.
Because states historically had primary responsibility for addressing
environmental pollution, including taking the lead role in enforcement
under federal environmental legislation of the 1950s and 1960s, many
states were dissatisfied with the new enforcement powers Congress
granted to EPA. Referring to his first term as EPA Administrator during
the 1970s, William Ruckelshaus described relations between EPA and
state governments as "terrible," largely because EPA itself represented
a repudiation of what the state regulators had been doing. The states
felt, he believed, that in the face of very little public or political
support, they had made considerable progress and were getting no credit
for it. The very existence of EPA symbolized to state environmental
agencies the lack of appreciation the public had for their efforts and
accomplishments.
Furthermore, because EPA was now responsible for ensuring the
implementation and enforcement of environmental laws, states needed to
demonstrate to EPA that they had acquired and were maintaining adequate
authority to enforce program requirements consistent with federal law
before EPA would "authorize" and continue to allow states to assume the
day-to-day administration of new environmental programs. This federal
oversight contributed to a very difficult period between EPA and the
states. The states thought EPA dictated too much and was too intrusive.
Difficulties in the EPA-state relationship manifested themselves from
the 1970s through the 1990s and, to some degree, have continued to the
present day. In 1980, we described the failings of the EPA-state
partnership.[Footnote 7] In a 1988 comprehensive management review of
EPA, we reported that while some progress had been made in improving
the EPA/state relationship, the goal of a truly effective EPA-state
partnership remained elusive.[Footnote 8] Many state officials
expressed concerns about having limited flexibility, too much EPA
control, and excessively detailed EPA oversight.
In 2003, OECA officials said that environmental commissioners in
several states and members of the Environmental Council of the States
(ECOS)[Footnote 9] called for OECA to develop and implement a
consistent and objective mechanism for measuring state performance.
Specifically, ECOS wanted EPA's oversight of state programs to be
consistent between EPA regions and states in the same region. ECOS also
wanted EPA oversight to be predictable, repeatable, and unbiased. In
December 2003, OECA began jointly developing the SRF with input from
EPA regions, associations representing state pollution control
agencies,[Footnote 10] ECOS and state officials to evaluate the extent
to which state performance in three major programs complies with
specific legal requirements, policy and guidance.[Footnote 11] The SRF
measures state performance using 12 required elements and an optional
13th element. The elements include five categories: (1) review of state
inspection implementation; (2) review of state enforcement activity;
(3) review of state enforcement commitments; (4) review of state data
integrity; and (5) for the optional 13th element, a review of
additional programs of the state's choice to insure consideration of
state activities that support the overall evaluation. Regions prepare a
draft report of the findings and conclusions of each review, jointly
discuss with the state how major recommendations will be addressed, and
provide the draft reports to OECA headquarters. OECA reviews the draft
reports and provides comments on the regions' analyses and
recommendations. A more detailed description of the SRF is included in
appendix II.
The relationship between EPA and state environmental agencies varies
substantially from state to state and program to program. Staff in
EPA's regional offices operate programs in those states that have
elected not to seek authorization and in those states that EPA has
concluded are not prepared to manage the programs effectively. In some
cases, where EPA has denied a state with program authorization, state
personnel may do most of the work as if they had the authority to grant
permits, with EPA employees handling only the final step of formally
issuing the documents. In other states or programs, EPA may approve a
"partial delegation" of authority, under which a state operates part of
a program that can be delegated and EPA operates the remainder.
Just as EPA can authorize a state to conduct day-to-day program
management, environmental statutes may allow EPA to withdraw
authorization if a state fails to meet certain conditions, including
maintaining the capacity to effectively manage the program and adopting
and properly exercising the legal authorities to enforce program
compliance consistent with federal laws and regulations. In practical
terms, however, EPA's ability to directly manage state programs is
limited because of its staffing levels and other resources.
Increases in EPA Funding Have Not Kept Pace with Inflation and
Enforcement Responsibilities:
Overall funding to regions and authorized states increased from fiscal
years 1997 through 2006. However, these increases did not keep pace
with inflation and the growth in enforcement responsibilities. Both EPA
and state officials told us they are finding it difficult to respond to
new requirements while carrying out their previous responsibilities.
However, EPA does not collect sufficient data on enforcement workload
and staffing, which it needs to assess the capacity of the regions and
states to effectively implement their responsibilities for enforcing
environmental laws consistent with federal requirements.
Resources for EPA Regions and the States Have Declined in Real Terms:
According to our analysis of EPA's budget and workforce for fiscal
years 1997 through 2006, EPA's total budget increased from $7.3 billion
to $7.7 billion--a decline of 13 percent in real terms.[Footnote 12] At
the same time, total funding for EPA enforcement increased from $455
million to $522 million--a decline of 5 percent in real terms. For the
regions, which command the bulk of enforcement resources, funding
increased from $288 million to $322 million--a decline of 8 percent in
real terms, while headquarters enforcement funding increased from $167
million to $200 million--a decline of 1 percent in real terms. Figure 1
shows the changes in EPA enforcement funding in real terms, in total,
and by headquarters and regional offices.
Figure 1: EPA's Enforcement Funding in Real Terms, in Total, and by
Headquarters and Regional Offices, Fiscal Years 1997-2006:
[See PDF for image]
Source: GAO analysis of EPA data.
Note: In nominal terms, funding enforcement in EPA regions increased
from $288 million in fiscal year 1997 to $322 million in fiscal year
2006.
[End of figure]
According to officials in OECA and EPA's Office of the Chief Financial
Officer, OECA headquarters absorbed decreases in OECA's total
enforcement funding in recent years to prevent further reductions to
the regions. According to our analysis, enforcement funding for OECA
headquarters increased from $197 million in fiscal year 2002 to $200
million in fiscal year 2006--a 9 percent decline in real terms. During
the same time, regional enforcement funding increased from $279 million
to $322 million--a 4 percent increase in real terms.
EPA reduced the size of the regional enforcement workforce by about 5
percent over the 10 years, from 2,568 full-time equivalent (FTE) staff
in fiscal year 1997 to 2,434 FTEs in fiscal year 2006. In comparison,
the OECA headquarters workforce declined 1 percent, and the EPA total
workforce increased 1 percent during the same period. Figure 2 shows
the changes in headquarters and regional FTEs from fiscal years 1997
through 2006.
Figure 2: OECA Headquarters and Regional Total FTEs, Fiscal Years 1997-
2006:
[See PDF for image]
Source: EPA Office of Budget.
[End of figure]
As figure 3 shows, the change in FTEs was not uniform across the 10
regions over the period. For example:
* Two regions--Region 9 (San Francisco) and Region 10 (Seattle)--
experienced increases in their workforce: Region 9 increased 5 percent,
from 229 to 242 FTEs, and Region 10 increased 6 percent, from 161 to
170 FTEs.
* Two regions--Region 1 (Boston) and Region 2 (New York) experienced
the largest declines: Region 1 experienced a 15 percent decline, from
195 to 166 FTEs, and Region 2 had a 13 percent decline, from 291 to 254
FTEs.
Figure 3: OECA Regional Offices FTEs, Fiscal Years 1997-2006:
[See PDF for image]
Source: EPA Office of Budget.
[End of figure]
As EPA's real total funding declined, EPA's real total grant funding to
states and tribes declined, as shown in figure 4. States and tribes use
these grant funds, combined with their own resources, to implement and
enforce environmental programs consistent with federal requirements.
EPA's grants to authorized states and tribes increased from $2.9
billion to $3.2 billion from fiscal years 1997 through 2006--a decline
of 9 percent in real terms. However, grant funding to states and tribes
dropped substantially between fiscal years 2004 and 2006, from $3.9
billion to $3.2 billion--a 22 percent decline in real terms.
Figure 4: EPA's Real Total Funding and Real Total Grant Funding to
States and Tribes, Fiscal Years 1997 through 2006:
[See PDF for image]
Source: GAO analysis of EPA data.
Note: In nominal terms, funding for grants to states and tribes
increased from $2.9 billion in fiscal year 1997 to $3.2 billion in
fiscal year 2006.
[End of figure]
For the programs we examined, EPA provides states with federal
resources through grant programs. In addition, under the Clean Air Act,
states must collect fees from permitted facilities to help fund the
program. The following are some of the funding sources for the programs
we examined:
* Clean Water Act Section 106 Grants. The Office of Water provides
annual Water Pollution Control grant funds to the states under the
Clean Water Act for, among other things, enforcement of point source
pollution requirements.
* Clean Air Act Section 105 Grants. States finance enforcement of air
quality laws with fees paid by permitted facilities (e.g., electric
utilities and chemical manufacturers), in accordance with title V of
the Clean Air Act. States assess fees based on tons of pollution
emitted. The fee must be at least $25 per ton (as adjusted for
inflation) of regulated pollutants (excluding carbon monoxide). EPA
provides grants to states to help fund programs that prevent and
control air pollution or to implement national ambient air quality
standards, including programs that may address smaller sources that do
not have to obtain permits (e.g., dry cleaners and gasoline stations).
* Resource Conservation and Recovery Act (RCRA) Section 3011 Grants.
The Office of Solid Waste and Emergency Response provides annual grants
to states under section 3011 of the Solid Waste Disposal Act to
support, among other things, state enforcement of the RCRA Subtitle C
Hazardous Waste Management programs.[Footnote 13] EPA's financial
assistance covers up to 75 percent of a state's total costs for
managing hazardous waste.
* Underground Storage Tank (UST) Grants. The Office of Underground
Storage Tanks provides grants to states under subtitle I of RCRA to
support state UST programs, including inspections and enforcement
activities.
EPA Regions and States Find It Difficult to Respond to New Requirements
under Current Resource Constraints:
Given the real reductions in funding and personnel, regional and state
enforcement officials noted states are finding it difficult to respond
to new enforcement requirements in the Clean Water Act, Clean Air Act,
and RCRA, which have greatly increased the number of regulated
pollutants and sources.[Footnote 14] However, as we reported in June
2006, EPA's data collection system for state and regional enforcement
activities does not provide consistent and complete data on the
workload of the states or the regions, and on their capacity to meet
their workload, including the enforcement of environmental programs
consistent with federal requirements.[Footnote 15] Thus, we were not
able to independently assess their capabilities to meet their
responsibilities under environmental programs with their existing
resources.
Clean Water Act:
In 1987 amendments to the Clean Water Act,[Footnote 16] Congress
expanded the scope of the act by regulating storm water runoff from
rain or snow as a discharge from point sources, such as industrial
facilities and municipal separate storm sewer systems. We reported in
2005 that that the new storm water regulations increased the number of
industrial and municipal facilities subject to regulation by an
estimated 186,000 facilities. In that same year, the EPA Office of
Inspector General reported that the new requirements added hundreds of
thousands of construction projects to states' and regions' workloads
related to storm water pollution sources. In 2005, EPA established
storm water as a national enforcement priority.
According to state water quality enforcement officials, it is difficult
to meet these new requirements while still meeting older requirements
to periodically inspect large municipal and industrial point sources.
For example, Minnesota officials told us that there are a huge number
of facilities and locations that require inspection and permits in that
state. The Minnesota storm water officials provided us a performance
report that indicated noncompliance with storm water requirements was
so pervasive that the state's water enforcement program was not meeting
its timeliness targets for closing enforcement cases where it has the
authority to issue a penalty. The report said that the situation
threatened to undermine earlier success in implementing the state's
storm water permit program. According to the Arkansas director of the
state's water quality program, storm water enforcement work in the fast-
growing northwestern corner of the state has overwhelmed the program.
According to state data, the number of storm water permits issued grew
by 512 percent--from 427 to 2,616--between 2003 and 2005. At the same
time, the number of permits Arkansas officials issued to traditional
point sources increased by 19 percent, from 190 to 227 facilities.
However, the state is beginning to fall behind in issuing the
traditional permits because it has had to redeploy inspectors to work
on storm water enforcement.
Regional officials told us they have provided assistance to some states
to meet enforcement requirements for storm water, such as helping
states complete a specified number or percentage of state inspections.
For example, Region 8 (Denver) enforcement officials said they share
the inspection workload with Montana officials because that state's
permit program is chronically underfunded, and this partnership enables
state officials in Montana to focus on reducing their backlog of
regulated facilities that require permit renewals.
Clean Air Act:
In 1990 amendments to the Clean Air Act,[Footnote 17] Congress created
significant new enforcement requirements for both EPA regions and
states.[Footnote 18] Title III of the 1990 amendments required EPA to
control emissions of 189 air toxics by, among other things, developing
technology-based emissions limits for major stationary
sources.[Footnote 19] By 2006, there were an estimated 84,000 major
stationary sources within 158 major source categories such as
incinerators and chemical plants to which these standards applied.
Title III of the amendments also directed EPA to develop a list of
categories of small stationary sources, such as dry cleaners and gas
stations--so-called "area sources"--sufficient to represent 90 percent
of emissions from small stationary sources of listed hazardous air
pollutants. EPA and authorized states were then to implement strategies
to control toxic emissions from these sources. EPA developed a list of
70 categories, but, as we reported in 2006, it had issued standards for
only 16.[Footnote 20]
Under title V of the 1990 amendments, Congress directed EPA and
authorized states to implement a comprehensive permit program for
sources emitting regulated air pollutants.[Footnote 21] The new
requirement significantly expanded an earlier permit program that
applied only to major new construction or modifications of existing
major sources of pollution. As of April 2001, EPA had authorized all 50
states and 63 local governmental units to act as clean air regulatory
agencies and issue Title V operating permits. The 1990 amendments also
required states to collect fees from regulated facilities sufficient to
cover program costs. We reported in 2001 that 19,880 major sources had
already received, or could be expected to obtain or comply with the
conditions of, Title V permits;[Footnote 22] furthermore, federal and
state regulators performed about 17,800 routine inspections each year
in fiscal years 1998 and 1999.
State air enforcement officials said that reductions in federal air
quality grants and EPA restrictions on how states can use the permit
fees limit their ability to meet new Clean Air Act requirements. For
example, enforcement officials in Arizona and West Virginia told us
that reductions in section 105 grants have made it difficult to meet
EPA's push for states to identify and regulate air toxic emissions from
small stationary sources, such as dry cleaners. According to the
director of West Virginia's air quality program, while his office has
identified these sources and provided this information to Region 3
(Philadelphia), it does not have the resources to regulate these
sources. Title V rules restrict states from using permit fees for
enforcement of air toxic emission standards for small stationary
sources.
Several state officials said they also face difficulties keeping up
with Title V requirements to issue operating permits and inspect
facilities. For example, according to West Virginia's Director of Air
Quality, the state program is spending more than it generates in
revenues from Title V permit fees. Furthermore, the state is drawing
down a reserve fund that it established in 1993, when it was operating
a preliminary Title V program before it was authorized to administer
this program. West Virginia's Title V fee is around $21 per ton, which
is below the national average fee of $28 per ton paid by major sources
in 2001.[Footnote 23] The Director of Arizona's Air Quality Division
said that as a result of new standards and new types of performance
testing, the Title V permitting workload has increased faster than
staff levels.
Resource Conservation and Recovery Act:
The 1984 amendments to RCRA[Footnote 24] required EPA and authorized
states to regulate small-quantity hazardous waste generators--those
producing between 100 and 1,000 kilograms of waste per month. Before
the 1984 amendments, EPA only required generators who produce more than
1,000 kilograms of hazardous waste to comply with regulations
concerning, among other things, record keeping and reporting. In
addition, the 1984 amendments required EPA and authorized states to
ensure that owners and operators of treatment, storage and disposal
facilities comply with new prohibitions for disposing of untreated
hazardous wastes on land.
This expansion of responsibility, combined with a reduction in
resources, has made it difficult to carry out responsibilities,
according to state hazardous waste enforcement officials we spoke with.
For example, data provided to us by New York State officials showed
that the state's grant for hazardous waste management dropped in real
terms by 19 percent between fiscal years 1997 and 2006. As a result of
this decline in funding, New York State officials said that the grant
supports fewer full-time staff. The officials provided us data that
showed New York State's grant for hazardous waste management supported
38 percent fewer full-time staff in the state's RCRA program in fiscal
year 2006 than in fiscal year 1997. Furthermore, while it continues to
focus on EPA's national priorities for enforcement, the state has
accumulated a backlog of permits that must be renewed. Renewing these
hazardous waste permits is critical to protecting the environment and
public health because EPA and authorized states can enforce new
hazardous waste standards only when they are specified in a permit.
According to these officials, EPA has issued new standards during the
life of the old permit and these new standards are not enforceable
until the permit is renewed.
Several states identified an emerging challenge: verifying that owners
and operators of hazardous waste facilities have the financial
resources to clean up their sites, as RCRA requires, rather than
leaving site cleanup to the taxpayer. As we reported in 2005, EPA's
Office of Inspector General concluded that required cleanups at some
sites could exceed $50 million. EPA made enforcement of the financial
assurance requirement a national enforcement priority in 2005. However,
state officials told us, and EPA's regional officials agreed, that they
do not have the personnel with the necessary skills to evaluate the
financial assurances provided. For example, New York State officials
told us that they have only one person trained to review the adequacy
of a facility's financial assurance.
The Energy Policy Act of 2005[Footnote 25] also expanded states'
enforcement workload by requiring, among other things, (1) EPA and any
state receiving federal funding to inspect by August 8, 2007, all
regulated tanks that were not inspected since December 22, 1998, and
(2) EPA or the state must generally inspect regulated tanks once every
3 years and complete the first 3-year inspection cycle within 3 years
of completing inspections of underground storage tanks that had not
been inspected by December 22, 1998.[Footnote 26] We reported in
February 2007 that according to EPA data there were 645,990 active
federally regulated underground storage tanks registered with state
underground storage tank programs.[Footnote 27]
To carry out these additional inspections, the act, as amended, allows
states to use Leaking Underground Storage Tank Trust Fund
appropriations, and authorizes substantial appropriations from the
trust fund during fiscal years 2006 through 2011. These new
appropriations were to be in addition to State and Tribal Grant funds
EPA provides to states for underground storage tank programs, which
historically have been about $187,000 annually. These additional funds
were not appropriated in fiscal years 2006 and 2007. As a result, some
state officials told us, they do not have sufficient resources to meet
the new inspection requirements. For example, Minnesota officials said
they have sufficient resources for inspecting underground storage tanks
only once every 9 years. Regional officials acknowledged that many
states need additional inspectors for meeting these new underground
storage tank inspection requirements and said they provide support to
states facing fiscal constraints. For example, the Region 3 Chief of
RCRA enforcement and compliance said the region helped state officials
in West Virginia by inspecting small and midrange gas stations in the
state. Region 9 (San Francisco) has also been working with UST
officials in Arizona to meet the new inspection requirements.
EPA and States Have Taken Steps to Improve Planning and Priority
Setting for Enforcement, but Results Are Uneven:
EPA has made substantial progress in improving priority setting and
enforcement planning with states through its system for setting
national enforcement priorities and NEPPS, which have fostered a more
cooperative relationship. For example, on states' recommendation, OECA
accepted as a priority ensuring that facilities handling hazardous
substances, such as lead or mercury, have the financial resources to
close their facilities, clean up contamination, and compensate
communities and individuals affected by the contamination. EPA and
states have also made some progress in using NEPPS for joint planning
and resource allocation. State participation in the partnership grew
from 6 pilot states in fiscal year 1996 to 41 states in fiscal year
2006.
EPA Implemented a More Collaborative Process for Setting National
Priorities for Enforcement:
Since the late 1980s, EPA's top agency executives have set priorities
for improving agency management. To develop more collaborative
relationships among EPA's headquarters and regions, and the states,
OECA created the Planning Council in 2003 to direct OECA's strategic
and planning processes, including selecting national enforcement
priorities. The council includes both EPA headquarters and regional
officials. In the summer of 2003, OECA asked officials representing
state environmental agencies, tribal governments, and air, water, and
solid waste pollution control associations to recommend priorities for
consideration as national priorities for fiscal years 2005 through
2007. Considering these recommendations, as well as those from EPA's
media program managers, OECA developed a list of potential national
priorities that it published in the Federal Register in December 2003.
OECA asked for public comments on candidate priorities and suggestions
for new national enforcement priorities. In January 2004, OECA hosted a
meeting with headquarters and regional officials, and representatives
from 10 state environmental agencies, four tribal governments, and
three pollution control associations to discuss and rank their choices
of potential priorities. OECA then selected the final national
enforcement priorities for fiscal years 2005 through 2007 based on the
following criteria:
* Significant environmental benefit. In what specific areas can the
federal enforcement and compliance assurance programs make a
significant positive impact on human health and/or the environment?
What are the known or estimated public health or environmental risks?
* Noncompliance. Are there particular economic or industrial sectors,
geographic areas, or facility operations where regulated entities have
demonstrated serious patterns of noncompliance?
* EPA responsibility. What identified national problem areas or
programs are better addressed through EPA's federal capability in
enforcement or compliance assistance?
Table 1 shows the potential national priorities, and those that were
selected.
Table 1: EPA's Candidate and Final National Enforcement Priorities for
Fiscal Years 2005-2007, in Rank Order:
Potential priorities: Clean Air Act;
Priorities selected: [Empty].
Potential priorities: Clean Air Act: Air toxics;
Priorities selected: [Check].
Potential priorities: Clean Air Act: New source review/prevention of
significant deterioration;
Priorities selected: [Check].
Potential priorities: Clean Water Act; Priorities selected: [Empty].
Potential priorities: Clean Water Act: Effects of wet weather on
concentrated animal feeding operations, combined sewer overflows,
sanitary sewer overflows, and storm water runoff;
Priorities selected: [Check].
Potential priorities: Petroleum refining;
Priorities selected: [Check] [A].
Potential priorities: Resource Conservation and Recovery Act;
Priorities selected: [Empty].
Potential priorities: Resources Conservation and Recovery Act:
Financial assurance/financial responsibility;
Priorities selected: [Check].
Potential priorities: Resources Conservation and Recovery Act: Mineral
processing;
Priorities selected: [Check].
Potential priorities: Tribal environmental issues;
Priorities selected: [Check].
Potential priorities: Federal facilities;
Priorities selected: [Empty].
Potential priorities: Resource Conservation and Recovery Act;
Priorities selected: [Empty].
Potential priorities: Resource Conservation and Recovery Act: Leaking
underground storage tanks;
Priorities selected: [Empty].
Potential priorities: Ports of entry;
Priorities selected: [Empty].
Potential priorities: Asbestos in schools;
Priorities selected: [Empty].
Potential priorities: Auto salvage yards;
Priorities selected: [Empty].
Potential priorities: Environmental justice;
Priorities selected: [Empty].
Potential priorities: Miscellaneous plastics;
Priorities selected: [Empty].
Potential priorities: Safe Drinking Water Act;
Priorities selected: [Empty].
Potential priorities: Microbials;
Priorities selected: [Empty].
Potential priorities: Fuels management;
Priorities selected: [Empty].
Potential priorities: Significant noncompliance oversight;
Priorities selected: [Empty].
Source: EPA.
[A] EPA's national petroleum refining priority addresses air emissions
from the nation's petroleum refineries. EPA reached its goal of
addressing 80 percent of the domestic refining capacity through
settlements or filed civil actions. As a result, OECA removed it from
the national priority list at the end of fiscal year 2006.
[End of table]
According to state and regional officials, OECA's approach for
selecting national priorities has fostered a more collaborative working
relationship, and they pointed to the financial assurance national
priority under RCRA as a case in point. This priority focuses on
ensuring that owners and operators of facilities handling hazardous
substances, such as lead or mercury, provide assurance that they have
the financial resources necessary to close their facilities, clean up
any contamination, and compensate communities and individuals affected
by any contamination they cause. Stakeholders--EPA regions, states,
pollution control associations,[Footnote 28] and the public--told OECA
that financial assurance should be a national priority. EPA and state
supporting investigations confirmed that (1) there are significant
noncompliance issues relating to the financial assurance requirements;
(2) the issues are of national importance and deal with several
environmental laws and regulatory programs; and (3) areas of
noncompliance were not isolated to a specific sector, industry, or
geographic location. In selecting financial assurance as a national
priority, OECA stated that an effective national enforcement and
compliance strategy would help address many of the problems created by
the regulated facilities' failure to fulfill their financial
responsibility obligations. In this regard, EPA is providing training
to state inspectors--who often do not have expertise in financial
management--on how to assess the adequacy of financial documentation
provided by regulated facilities.
While state and regional officials told us the priority setting process
is more collaborative, some state officials raised a number of issues
about how EPA considered their comments about national priorities. For
example, Massachusetts and Oregon officials told us that they did not
understand why OECA ranked some of their priorities lower than the
national priorities that were selected and would like to have feedback
on how their views were considered when selecting national enforcement
priorities. In addition, while Minnesota, Utah, and Arizona officials
agree that the planning and priority setting has improved, they would
prefer earlier involvement in the decision-making process, that is, in
developing the candidate list. On the other hand, New York and Arkansas
said that they preferred to provide input on the national enforcement
priorities through the pollution control associations and/or ECOS. They
said, by doing so, OECA will receive states' collective views on the
candidate priorities in a more representative and compelling way.
After OECA selects the national enforcement priorities, it uses the
National Program Managers guidance to inform its stakeholders of the
national priorities and required elements of all environmental laws.
The managers establish overall national goals for their respective
programs based on a variety of factors, including underlying statutory
mandates, congressional directives, administration/administrator
priorities, and their own view of programs and policies that the
programs should focus on. EPA regions and states use this guidance to
negotiate agreements based on (1) which environmental problems will
receive priority attention within state programs, (2) what EPA's and
the states' respective enforcement roles and responsibilities will be,
and (3) how the states' progress in achieving program objectives will
be assessed. The results of these negotiations are documented primarily
in PPAs and/or PPGs. According to EPA, NEPPS allows regions and states
to negotiate agreements that vary in content and emphasis to reflect
regional and state conditions and priorities.
Extent of States' Participation in the Planning and Priority Setting
Process Varies:
State participation in NEPPS grew from 6 pilot states in fiscal year
1996 to 41 states in fiscal year 2006. Of these 41 states participating
in NEPPS in fiscal year 2006, 31 had both PPAs and PPGs; 2 had
agreements only; and 8 had grants only. Twelve states did not
participate at all in NEPPS.
Regional officials and states participating in NEPPS said it
contributed to improvements in their planning and priority setting
process by helping identify enforcement priorities, roles, and
responsibilities. The states we spoke with that had a PPA--Iowa,
Massachusetts, Minnesota, Oregon, and Utah--also had a PPG and
generally agreed that EPA's planning and budget process fostered
collaboration in setting joint priorities, roles, and accountability
for each party. In addition, Minnesota and Massachusetts officials told
us that they have been able to use grant resources to address other
state priorities. However, these officials noted that EPA guidance
continues to call for a specific number of enforcement activities,
which does not allow for as much flexibility as envisioned.
States without a PPA can still participate in NEPPS through a PPG,
which allows them to combine individual categorical grant funds into a
consolidated grant. Once the funds are consolidated, they lose their
category-specific identity and can be used with greater flexibility. We
found that states that had a PPG, but not a PPA, had mixed views on
NEPPS. For example, according to the New York State Department of
Environmental Conservation (NYSDEC), which currently has a performance
grant only for water programs, it experimented with a performance
agreement in the mid-1990s but dropped the endeavor because of
difficulties in drafting an agreement that combined multiple agency
divisions. NYSDEC officials said the amount of work involved outweighed
the benefits to individual programs. Furthermore, even with a
performance grant for water programs, NYSDEC officials told us, EPA
still maintains requirements for how the money is used and attempts to
steer the state toward EPA's priorities, which are not necessarily
NYSDEC's priorities. In contrast, the Arizona Department of
Environmental Quality, which has a performance grant but not a
performance agreement, said it has a "fantastic relationship" with
Region 9 that is characterized by extensive coordination and
communication. Because of its grant, Arizona officials told us, the
state has realized administrative efficiencies and has more flexibility
to move money among programs.
States that do not participate in NEPPS were generally satisfied with
the amount of joint planning and coordination in their work plan
agreements (i.e., memorandum of agreement and annual work plans). For
example, West Virginia and Florida told us that their work plan
agreements with their EPA regions provided them with much of the same
opportunities for joint planning, flexibilities, and priority setting
as NEPPS participants. Officials from the West Virginia Department of
Environmental Protection said they did not participate in NEPPS because
they did not wish to transfer grant funding among media programs. They
said state programs rely heavily on revenue generated through fees and
penalties; therefore, program managers are reluctant to share
resources. According to officials from the Florida Department of
Environmental Protection, they have not participated in NEPPS since
1999 because their work plan agreements provide the benefits of NEPPS-
-good dialogue with the region in planning and priority setting.
Moreover, Florida officials said they cannot use the flexibility
allowed under NEPPS to redirect resources between programs because
state appropriation procedures place restrictions on their ability to
shift resources among programs.
State Review Framework Has the Potential to Provide More Consistent
Oversight:
With its implementation of the SRF, EPA has--for the first time--a
consistent approach for overseeing authorized states' compliance and
enforcement programs and has identified several significant weaknesses
in how states enforce their environmental laws in accordance with
federal requirements.[Footnote 29] For example, the SRF reviews found
that states are not properly documenting inspection findings or
penalties, as directed by EPA's enforcement policy and guidance. While
recognizing that these findings are useful, EPA has not developed a
plan for how it will uniformly address them in a timely manner. Nor has
the agency identified the root causes of the weaknesses, although some
EPA and state officials attribute the weaknesses to causes such as
increased workloads concomitant with budgetary reductions. Until EPA
addresses enforcement weaknesses and their causes, it faces limitations
in determining whether states perform timely and appropriate
enforcement, and whether they apply penalties to environmental
violators in a fair and consistent manner within and among the states.
Moreover, the SRF is still in its early stages of implementation and
offers additional uses that EPA has not yet considered. In this regard,
its structured approach provides consistent information that would be
useful to (1) inform the public about how well the states are
implementing their enforcement responsibilities and (2) serve as a
basis for assessing the performance of EPA's regions, which have been
inconsistent in their enforcement and oversight efforts in the past.
SRF Findings Demonstrate the Value of a Uniform Approach to Evaluating
State Enforcement Programs:
As of January 25, 2007, OECA had conducted SRF reviews in 33 states and
expected to complete its assessment of remaining states by the end of
fiscal year 2007. OECA reported good performance in most aspects of
state compliance and enforcement programs. However, it also reported
that the reviews found several weaknesses in state programs that will
require focused attention to correct. EPA officials said the following
four weaknesses were the most frequently identified:
* States are not adequately documenting the results of facility
inspections in order to determine the significance of violations. EPA
policy states that complete and accurate documentary evidence is needed
to determine the nature and extent of violations, particularly the
presence of significant violations, and to support timely and
appropriate enforcement actions. EPA policy also states that a quality
program should maintain accurate and up-to-date files and records, and
report this information to EPA to support effective program evaluation
and priority setting. EPA and state officials suggested that some of
the causes of inadequate state documentation and reporting of facility
inspections can be traced to a lack of staff expertise, inadequate
training, increasing workload, and reductions in staff and budgetary
resources in recent years.
* States are not adequately entering significant violations noted in
their inspection reports into EPA databases. GAO, EPA's Office of
Inspector General, and OECA have reported that the lack of complete and
accurate national enforcement data has been a long-term problem. OECA
needs accurate and complete enforcement data to help it determine
whether core enforcement requirements are being consistently
implemented by regions and states and whether there are significant
variations from these requirements that should be corrected. In
addition, accurate and complete enforcement data helps OECA more
efficiently and effectively oversee states and regions. According to
EPA regional and state officials, the SRF is helping them recognize the
reasons for discrepancies between state and EPA databases and improve
the quality of data in these databases.
* States lack adequate or appropriate penalty authority or policies.
Penalties play a key role in environmental enforcement by deterring
potential violators and ensuring that members of the regulated
community cannot gain a competitive advantage by violating enforcement
regulations. To qualify as an authorized state for administering
environmental programs, states must, among other things, acquire and
maintain adequate authority to enforce program requirements consistent
with federal requirements. For example, to obtain EPA's approval to
administer the Clean Air Act's Title V permitting requirements for
major air pollution sources, states must have, among other things,
authority to recover civil penalties and provide appropriate criminal
penalties. EPA's policy provides that all penalties should include two
components. First, penalties should include an "economic benefit"
component that reflects the benefit achieved by avoiding compliance.
This component is considered important to "leveling the playing field"
among companies within an industry and eliminating any economic
advantage violators gain through delayed or avoided compliance costs.
The second component--the "gravity-based component"--reflects the
seriousness of the violation, the actual or possible harm it causes,
and the size of the violator.
* States are not documenting how they implement EPA's policies for
calculating and assessing penalties. According to EPA policy, states
need to maintain sufficient documentation so that the regions can
evaluate (1) the state's rationale for obtaining a penalty and (2)
where appropriate, the calculation of the economic benefit and gravity-
based components. If a state has not assessed a penalty or other
appropriate sanction against a violator, EPA may take direct
enforcement action to recover a penalty. However, regional and state
offices we interviewed said applying this policy places strains on the
EPA/state working relationship because states generally prefer that EPA
not take direct enforcement action against regulated entities in their
states. For this reason, EPA generally does not take direct enforcement
action solely to recover additional penalties unless a state penalty is
determined to be grossly deficient.
Regional and state officials said states vary as to whether their
environmental program administrators have the authority to assess
penalties. If program administrators lack this authority, they must
pursue judicial remedies through their state attorney general. Judicial
actions generally result in penalties and court orders requiring
correction of the violation. However, this route is more time-consuming
and resource-intensive than having the environmental program office
assess the penalty and can significantly delay obtaining penalties and
achieving a return to compliance.
Modifications to the SRF Could Improve EPA's Enforcement Oversight
Process:
The initial SRF findings provide the basis for discussions between EPA
and the states on how to address deficiencies in state compliance and
enforcement programs, many of which have been well known and long-
standing. According to OECA officials, EPA will have completed an SRF
review in all states by the end of 2007 and will perform an evaluation
of the SRF in fiscal year 2008. The proposed evaluation methodology
states that EPA will address the effectiveness of implementing the SRF
by surveying the state environmental agencies that participated in the
reviews and the pollution control associations. However, this proposed
evaluation may not yield the results EPA will need to better ensure
more consistent state performance and more consistent state program
oversight. In this regard, the proposed evaluation methodology does not
specify how EPA plans to use the results of the SRF to begin
determining the causes for cited deficiencies and to identify
strategies for uniformly and expeditiously implementing potential
corrective actions.
While EPA's proposed evaluation may prove to be useful in obtaining
views on the success of the SRF and on areas needing improvement in
performing the reviews, the proposal is still in its early stages of
development, and specific details have not been laid out on whether and
how certain potential issues will be addressed. EPA could better ensure
more consistent state performance and more consistent oversight of
state enforcement programs by (1) developing and implementing
corrective actions for the major deficiencies identified through the
SRF and (2) assessing the capacity of poorly performing state programs
to determine whether they possess the staff, financial, and other
resources to effectively implement enforcement programs consistent with
federal requirements.
Region 8's experience in using the findings of its Uniform Enforcement
Oversight System may prove to be useful for OECA in addressing the
findings of the SRF on a nationwide basis. This oversight system was
designated a "best practice" in the area of state agency oversight by
EPA's Office of Inspector General.[Footnote 30] The region evaluated
states' enforcement programs using uniform review criteria that had
been previously agreed to by each state agency. The region then used
the evaluation findings to develop an improvement strategy tailored to
the particular weakness identified in each state's enforcement program.
In order to hold the states accountable for correcting the weaknesses
identified, Region 8 also used the improvement strategy in arriving at
annual agreements with the states. For example, because of the findings
from its oversight review of Colorado's hazardous waste program, Region
8 officials became concerned about the adequacy of the authorized
program's ability to protect human health and the environment or to
take on new program responsibilities. On the basis of these concerns,
the region conducted an in-depth "capability assessment" of Colorado's
hazardous waste program beginning in 1998, covering items such as the
state's levels of resources and staff skills; professional development
and training programs; and the efforts to resolve legal and
institutional limitations in its program. Over the next 4 years,
regional and state officials worked with state government leaders to
increase program funding, staff, and training, and to implement new
penalty policies. Region 8 also directly implemented compliance
monitoring and enforcement activities at selected Colorado hazardous
waste facilities while the state program developed and implemented its
enhanced capabilities. Region 8 conducted another capability assessment
in 2001 and concluded that the state had made the improvements
necessary to implement a fully authorized program.
EPA could also use the SRF to inform the general public and others
about the extent to which states effectively implement environmental
enforcement programs consistent with federal requirements. EPA has not
yet determined whether or how the results of the SRF reports will be
made available to the general public, congressional committees,
environmental interest groups, state environmental organizations, local
community groups, and other interested groups and organizations. Many
of these groups have expressed deep interest in and concern over the
years about the consistency, fairness, and effectiveness of
environmental enforcement. A common criticism has been that variation
in environmental compliance and enforcement among the states has
resulted in the lack of equitable public health and environmental
protection and the lack of a "level playing field" for business from
one state to another. EPA's Office of Inspector General also
recommended that regional evaluations of state programs should be made
easily accessible to the public as an important means for holding
states accountable for their environmental performance. ECOS and
several states officials we interviewed expressed concern that public
dissemination of the SRF reports would be used inappropriately to
compare or rank state performance. However, the SRF reports have the
potential to convey useful information to both EPA managers and to the
public on the extent to which the enforcement program is being
implemented consistently and fairly nationwide.
In addition to the usefulness of the SRF in evaluating state
enforcement programs, the SRF provides a model that OECA could use to
evaluate progress being made by EPA's regions in addressing
inconsistencies in enforcement actions and oversight. Although we
focused our review on EPA's oversight of state enforcement programs,
rather than on the enforcement programs of EPA's 10 regional offices,
we testified in June 2006 based on reviews on EPA's enforcement program
that the regions vary substantially in the actions they take to enforce
environmental requirements, such as the number of inspections performed
at regulated facilities and the amount of penalties assessed for
noncompliance with environmental regulations.[Footnote 31] In addition,
past EPA Inspector General and OECA evaluations found variations among
regions regarding issues such as sufficiently encouraging states to
consider economic benefit in calculating penalties, taking more direct
federal actions where states were slow to act, and requiring states to
report all significant violators.
In our June 2006 testimony, we stated that broad agreement exists among
EPA and state enforcement officials on the key factors contributing to
variations among regions including (1) differences in philosophy among
regional enforcement staff about how best to secure compliance with
environmental requirements, (2) differences in state laws and
enforcement authorities and the manner in which regions respond to
these differences, (3) variations in resources available to both state
and regional enforcement offices, (4) the flexibility afforded by EPA
policies and guidance that allow states a degree of latitude in their
enforcement programs, and (5) incomplete and inadequate enforcement
data that hamper EPA's ability to accurately characterize the extent to
which variations occur.[Footnote 32]
Although EPA has noted that some variation in environmental enforcement
is necessary to take into account local environmental conditions and
concerns, it has acknowledged that similar violations should be met
with similar enforcement responses to ensure fair and consistent
enforcement and equitable treatment for regulated businesses,
regardless of geographic location. Our testimony noted that the SRF was
among the initiatives that could make a positive contribution to EPA's
efforts to ensure consistent approaches in regional enforcement
activities, although it is too early to tell whether the initiative
will create a level playing field for the regulated community across
the country.
Conclusions:
The SRF initiative provides EPA with a potential means to ensure
consistent and effective enforcement among the states, thereby
addressing a difficult and long-standing challenge to the agency. EPA's
plan to evaluate the SRF in 2008 will provide the agency with an
opportunity to obtain information from the regions and the states
regarding what does and does not work well in these SRF reviews and to
make appropriate corrections to its review methodology. However, the
proposed evaluation methodology does not describe how EPA will examine
the causes of the significant deficiencies noted during the SRF reviews
and develop a strategy for addressing them. If these deficiencies are
not addressed in a uniform and timely manner, EPA and the states will
not gain the full benefit of the SRF.
Regardless of the extent and effectiveness of oversight reviews to
determine the consistency and effectiveness of enforcement programs,
corrective actions will not be feasible if states lack sufficient
funding, staff levels, expertise, and other resources that are vital to
carrying out their enforcement responsibilities. On the basis of the
audits it has conducted, the EPA's Office of Inspector General has
endorsed the practice of having regions follow up on the deficiencies
noted in their reviews of state programs and making their findings
public. Likewise, Region 8 demonstrated the value of performing a
capacity assessment to understand why deficiencies exist in a state
program to demonstrate to decision makers and the public what needs to
be improved. Such assessments would provide an improved basis for a
truly collaborative approach between the regions and the states during
their annual deliberations on partnership agreements and grants in
order to address the root causes of problems identified in state
enforcement programs.
EPA has not determined whether or how it will share the results of the
SRF reviews with the general public and others, including Members of
Congress who over the years have raised questions and expressed
concerns about the way the enforcement program has been implemented. If
Members of Congress and the public fully understand the deficiencies
and their significance, then they would be better informed about how to
assist EPA and the states in ensuring that public health and the
environment are protected and a level playing field is established for
regulated facilities.
Although the SRF thus far has been focused on reviewing state
enforcement programs, the process could be extended to include the
enforcement programs of EPA's regions. As we have previously reported,
the regions have long been inconsistent in their oversight of states
within their jurisdiction and the enforcement actions they take in
order to provide a level playing field for regulated facilities across
the nation.
Recommendations for Executive Action:
To enhance EPA's oversight of regional and state enforcement activities
to implement environmental programs consistent with the requirements of
federal statutes and regulations, we recommend that the Administrator
of EPA take the following actions:
* include, in EPA's fiscal year 2008 evaluation of the SRF, an
assessment of lessons learned and an action plan for determining how
significant problems identified in state programs will be uniformly and
expeditiously addressed;
* evaluate the capacity of individual authorized state programs, where
the SRF finds the state appears to lack sufficient resources (e.g.,
funding, staff, and expertise), to implement and enforce authorized
programs and then develop an action plan to improve that state's
capacity;
* publish the SRF findings so that the public will know how well state
regulators are enforcing authorized programs and protecting public
health and the environmental conditions in their communities; and:
* conduct a performance assessment similar to SRF for regional
enforcement programs.
Agency Comments and Our Evaluation:
In commenting on the draft report, EPA generally agreed with GAO's
recommendations and stated that the agency is taking action to address
the issues we raised. With respect to our recommendation to publish the
results of the SRF findings, EPA said that it had agreed with the
Environmental Council of the States that the first round of state
enforcement reviews would not be published. However, EPA said it would
consider whether to publish future reviews when it evaluates the
implementation of the SRF in fiscal year 2008. EPA also provided
detailed technical and clarifying comments, which we incorporated as
appropriate. EPA's letter is included in appendix III.
We are sending copies of this report to interested congressional
committees; the Administrator of EPA; and other interested parties. We
will also make copies available to others upon request. In addition,
the report will be available at no charge on GAO's Web site at
[hyperlink, http://www.gao.gov].
If you or your staff have any questions about this report, please
contact me at (202) 512-3841 or stephensonj@gao.gov. Contact points for
our Offices of Congressional Relations and Public Affairs may be found
on the last page of this report. Key contributors to this report are
listed in appendix IV.
Signed by:
John B. Stephenson:
Director, Natural Resources and Environment:
[End of section]
Appendix I: Scope and Methodology:
To assess how the Environmental Protection Agency (EPA) and authorized
state agencies work together to deploy resources, plan, set priorities,
and define roles and responsibilities for enforcement of and compliance
with environmental programs consistent with federal requirements, we
(1) identified the federal resources provided to EPA regions and states
for enforcement between 1997 and 2006, and obtained EPA regional and
states' views on the adequacy of these resources to implement their
activities; (2) determined EPA's progress in improving priority setting
and enforcement planning with its regions and authorized states; and
(3) examined EPA efforts to improve its oversight of states'
enforcement and compliance programs.
For the purpose of this review, we conducted semistructured interviews
with officials at the 10 EPA regions and at 10 authorized state
agencies. To construct questions for the interviews, we analyzed
policies, procedures, and guidance materials EPA has developed and
implemented. We synthesized the findings, conclusions, and
recommendations contained in reports by us, EPA's Office of Inspector
General (OIG), the National Academy of Public Administration (NAPA),
and the Environmental Council of the States (ECOS). We also met with
officials from EPA Region 4, the Georgia Department of Natural
Resources, South Carolina Department of Health, and the New Jersey
Department of Environmental Protection to obtain a more thorough
understanding of how state agencies work together to plan, set
priorities, define roles and responsibilities, and deploy resources for
enforcement and compliance of environmental laws.
We used a nonrandom sample of 10 states, which consisted of 1 state
from each region:
* Five had a Performance Partnership Agreement (PPA) and Performance
Partnership Grant (PPG) with EPA (Iowa, Massachusetts, Minnesota,
Oregon, and Utah). These states incorporated an enforcement program
into their PPA, along with other essential elements that EPA and state
leaders considered important (e.g., jointly agreed priorities, defined
roles/responsibilities, and processes for resource deployment).
* Five states did not have a PPA (Arizona, Arkansas, Florida, New York,
and West Virginia), but had either a PPG or an alternative working
relationship with EPA.[Footnote 33]
Our evaluation of 10 selected states cannot be generalized to the other
states with authorized programs. However, we met with EPA officials
representing all 10 regions, who provided their perspectives about all
state programs within their geographic region. In addition, we examined
other sources of state involvement, such as information available from
ECOS and pollution control associations (e.g., Association of State and
Territorial Solid Waste Management Officials, Association of State and
Interstate Water Pollution Control Administrators, State and
Territorial Air Pollution Program Administrators, and the Association
of Local Air Pollution Control Officials, now known as the National
Association of Clean Air Agencies).
We also limited our review to the environmental agencies within each
selected state that implement the major EPA programs (Clean Water Act,
Clean Air Act, Safe Drinking Water Act, and Resource Conservation and
Recovery Act) and did not include state departments or agencies that
implemented other programs, such as the Federal Insecticide, Fungicide,
and Rodenticide Act.
To determine if there were any trends in the federal resources provided
to EPA regions and states for enforcement from 1997 to 2006, and assess
EPA regional and state views on the adequacy of these resources to
implement their activities, we reviewed the budgets for EPA and the
Office of Enforcement and Compliance Assurance (OECA) for fiscal years
1997 through 2006. We also reviewed our prior reports and those from
the Congressional Research Service (CRS), Congressional Budget Office
(CBO), Office of Management and Budget (OMB), EPA, and the EPA OIG, for
information on the distribution of federal resources. We met with
officials from the EPA's Office of the Chief Financial Officer and
OECA, ECOS, and the Natural Resources Defense Council, and administered
structured interviews to officials in all 10 EPA regions and the
selected state in each region. In each region and state, we obtained
perspectives on the deployment of resources. However, we were not able
to assess the workload of the states and regions and their overall
capability to meet federal enforcement requirements because EPA's data
collection system does not collect sufficient information needed to
make such an assessment. In this regard, EPA lacks information on the
capacity of both the states and EPA's regions to effectively carry out
their enforcement programs, because the agency has done little to
assess the overall enforcement workload of the states and regions and
the number and skills of people needed to implement enforcement tasks,
duties, and responsibilities. Furthermore, the states' capacity
continues to evolve as they assume a greater role in the day-to-day
management of enforcement activities, workload changes occur as a
result of new environmental legislation, new technologies are
introduced, and state populations shift.
To determine EPA's progress in improving priority setting and
enforcement planning with its regions and authorized states, we
reviewed EPA's strategic plans and national strategy, its policy and
guidance for planning and implementing its enforcement programs, the
process for implementing National Environmental Performance Partnership
agreements with authorized state agencies, and Federal Register
notices. We also reviewed our prior reports and those from CRS, OMB,
EPA, EPA OIG, and NAPA for information on the planning and priority
setting process. We met with officials from EPA's Office of
Congressional and Intergovernmental Relations, OECA, ECOS, and the
Natural Resources Defense Council, and administered structured
interviews to all 10 EPA regions and the selected state in each region.
In each region and state, we examined regional and state strategic
plans and state-EPA enforcement agreements, such as memorandums of
agreement, PPAs, and PPGs. At state agencies, we also discussed the
states' perspectives on how EPA administered state-EPA agreements,
regional plans, and national priorities.
To determine EPA efforts to improve its oversight of state enforcement
and compliance programs, we reviewed EPA's policy and guidance for
overseeing state agencies. We met with officials from EPA's Office of
Congressional and Intergovernmental Relations, OECA, ECOS, and the
Natural Resources Defense Council, and administered structured
interviews to all 10 EPA regions, and the selected state in each
region. In each region, we examined strategic plans, state-EPA
agreements, and 33 state oversight reviews of the SRF. At state
agencies, we reviewed policy and guidance and received perspectives on
EPA's oversight process.
We performed our work from October 2005 through July 2007, in
accordance with generally accepted government auditing standards, which
included an assessment of data reliability and internal controls.
[End of section]
Appendix II: Development and Implementation of the State Review
Framework:
EPA's criteria for assessing the performance of compliance assurance
and enforcement responsibilities in authorized states can be traced
back to the mid-1980s. In August 1986, the EPA Deputy Administrator
issued a policy guidance memorandum entitled "Revised Policy Framework
for State/EPA Enforcement Agreements." The policy memorandum was
intended to provide a framework for gathering information and making
judgments about the effectiveness of state compliance and enforcement
performance and providing guidance on when and how EPA would become
involved in enforcement actions in authorized states. Among other
things, the 1986 policy guidance discussed (1) EPA oversight criteria
and the measures that the agency would use to define good state
performance, (2) oversight procedures and protocols, and (3) criteria
for direct federal intervention--factors EPA would consider before
taking direct enforcement action in a state and what states might
reasonably expect of EPA in this regard.
According to OECA officials, subsequent experience with the 1986 policy
guidance revealed several implementation shortcomings that limited
EPA's ability to adequately and consistently oversee state compliance
and enforcement programs. For example, the 1986 policy guidance did not
clearly describe how EPA would oversee state enforcement programs,
including what constituted "good program performance". Moreover, EPA
and authorized states did not agree on what uniform program information
states needed to maintain and provide to EPA for performance
measurement. This led to considerable inconsistency from region to
region in overseeing state compliance and enforcement programs.
By 2003, OECA officials said that environmental commissioners in
several states and members of ECOS were in the forefront of the call
for developing and implementing a more uniform and systematic process
for EPA's oversight and evaluation of state compliance and enforcement
programs. Other factors also pointed to the need to develop a more
consistent method of gauging state performance. These included EPA's
OIG audits of state programs, EPA's internal assessments, and public
petitions for withdrawal of program authorizations for some state
programs. A common criticism was that variation in environmental
compliance and enforcement among the states was directly attributable
to the lack of uniform EPA oversight and performance measurement and
that the result was the lack of equitable public health and
environmental protection and lack of a level playing field for business
from one state to another.
At an ECOS meeting in 2003, OECA officials said the Chairman of the
ECOS Compliance Committee proposed to EPA's then Deputy Assistant
Administrator for OECA a method for systematically and uniformly
assessing state performance. The assessment method, called the SRF, was
patterned after a review process originally developed by EPA's Region 8
to assess the performance of state compliance and enforcement programs
in that region (encompassing the states of Colorado, Utah, Wyoming,
South Dakota, North Dakota, and Montana and 27 sovereign tribal
nations). The SRF was formally agreed to by EPA, ECOS, state media
organizations, and state environmental agency officials in December
2003.
The 12-point evaluation model used in Region 8, called the Uniform
Enforcement Oversight System, became the basis for a review framework
for evaluating state compliance and enforcement performance. These 12
required elements for evaluation of state performance include the
following:
1. the degree to which a state program has completed the universe of
planned inspections (addressing core requirements and federal, state
and regional priorities);
2. the degree to which inspection reports and compliance reviews
document inspection findings, including accurate descriptions of what
was observed to sufficiently identify violations;
3. the degree to which inspection reports are completed in a timely
manner, including timely identification of violations;
4. the degree to which significant violations (e.g., significant
noncompliance and high priority violations) and supporting information
are accurately identified and reported to EPA national databases in a
timely manner;
5. the degree to which state enforcement actions include required
corrective or complying actions (e.g., injunctive relief) that will
return facilities to compliance in a specific time frame;
6. the degree to which a state takes timely and appropriate enforcement
actions, in accordance with policy relating to specific media;
7. the degree to which a state includes both gravity and economic
benefit calculations for all penalties, appropriately using the
economic benefit calculation model (BEN) or similar state model (where
in use and consistent with national policy);
8. the degree to which final enforcement actions collect appropriate
economic benefit and gravity penalties in accordance with applicable
penalty policies;
9. the degree to which enforcement commitments in the PPA, PPG, and/or
other written agreements to deliver a product/project at a specified
time, if they exist, are met and any products or projects are
completed;
10. the degree to which the minimum data requirements are timely;
11. the degree to which the minimum data requirements are accurate;
and:
12. the degree to which the minimum data requirements are complete,
unless otherwise negotiated by the region and state or prescribed by a
national initiative.
The SRF also includes a 13th "optional" element that is open for
negotiation between regions and states. EPA and ECOS encourage the use
of the 13th element to ensure the review takes a measure of the full
range of program activities and results. These components can add
meaningful input into a state's overall performance and program. Topics
could include program areas such as compliance assistance, pollution
prevention, innovation, incentive or self-disclosure programs,
relationships with state attorneys general, and outcome measures or
environmental indicators that go beyond the core program activities
covered in elements 1 through 12.
The SRF was also seen by the parties as being consistent with the
principles of the National Environmental Performance Partnership
System, which provides a mechanism for joint planning and program
management that takes advantage of the unique capabilities of each
party in addressing pressing environmental problems. Also, the SRF
considers commitments negotiated between EPA regions and states
contained in PPAs, PPGs, and/or other agreements that may differ from
national policy and guidance and evaluates state performance in terms
of those commitments. In cases where states and regions have negotiated
different state commitments (e.g., number of inspections) or other
activities, states are held accountable for those commitments, although
the SRF reviewers may provide feedback that those commitments need to
be increased in the future to fully demonstrate an adequate enforcement
program.
After a review is completed, the regions prepare a draft report of the
findings and conclusions, jointly discuss with the state how major
recommendations will be addressed, and provide the draft report to OECA
headquarters. OECA reviews the draft reports and provides comments on
the regions' analyses and recommendations. OECA expects regions to
incorporate these recommendations into the next round of negotiated
agreements, where OECA will track and manage the recommendations to
conclusion.
Additional anticipated benefits of applying the SRF's elements in a
uniform manner included, among others, (1) more strategic resource
allocation, (2) reduction of duplicative work, (3) consistent and
predictable baseline oversight across states and regions with agreed-
upon thresholds for corrective action, (4) differential oversight of
state programs based on performance,[Footnote 34] (5) a level playing
field for states in competition for business, and (6) improved public
confidence in federal and state compliance and enforcement programs. In
addition, the SRF is viewed as providing a basis to establish a
dialogue on performance that will lead to improved program management
and environmental results.
OECA pilot-tested the SRF during fiscal year 2004 in at least one state
in each of EPA's 10 regions. The states that participated in the pilot
were all volunteers. The pilot states included Alaska, Arizona,
Colorado, Rhode Island, New Jersey, Maryland, Michigan, Missouri,
Nebraska, Oklahoma, and South Carolina. OECA also piloted the SRF in
one EPA region, Region 10 (Seattle), to test the approach on EPA's
direct implementation of the Resource Conservation and Recovery Act
(RCRA) and the Clean Water Act National Pollution Discharge Elimination
System (NPDES) program in Alaska. EPA used the SRF to evaluate the
enforcement performance of three media programs (both the pilot reviews
and subsequent reviews): the Clean Air Act Stationary Sources program,
the Clean Water Act NPDES program, and (RCRA) Subtitle C hazardous
waste program. For each program, the SRF defined the essential elements
and then, in a companion Framework Implementation Guide more fully
defined how each element is to be applied and measured.
In February 2005, OECA contracted for an evaluation of the pilot review
process to determine whether the SRF provides an accurate assessment of
state compliance and enforcement activities. The evaluation sought to
obtain answers to questions, such as the following: (1) Are the 12
review elements the right ones? (2) Are the right data metrics being
used? (3) What barriers were encountered? The evaluation also addressed
such implementation issues as whether the reviews could be streamlined
and made more efficient; what barriers were encountered in conducting
the reviews and how they could be reduced or eliminated; and the
consistency of application across the country, specifically any need
for and ways to improve consistency; problems with objectivity; and
apparent gaps in capability or expertise that need to be addressed.
The pilots were also evaluated to determine what they indicated about
the performance of the states, whether corrective actions or
differential oversight agreements get codified in grant agreements, and
the best way to summarize and communicate the results of the review.
The evaluation used the results of the pilots as well as discussions
with key stakeholders to support recommendations aimed at helping OECA
improve the SRF before implementing it more broadly. For example, while
OECA had allowed regions considerable discretion/flexibility on
procedures for file selection, the evaluation identified a number of
weaknesses in the file selection process and highlighted potential
improvements to OECA's file selection protocol. The consultant
developed an improved sampling model that would yield representative
file reviews across states and provide a more representative picture of
enforcement and compliance assurance across states with varying levels
of enforcement activity.
[End of section]
Appendix III: Comments from the Environmental Agency:
United States Environmental Protection Agency
Washington, D.C. 20460
Office Of Enforcement And Compliance Assurance:
July 15, 2007
John B. Stephenson:
Director, National Resources and Environment:
U.S. Government Accountability Office Room 2T23:
441 G Street, N.W.:
Washington, D.C. 20548:
Dear Mr. Stephenson:
Thank you for the opportunity to provide comments on the draft report,
"EPA-State Enforcement Partnership Has Improved, but EPA's Oversight
Needs Further Enhancement". The draft report provides a thoughtful
discussion on a number of areas central to our implementation of the
national enforcement program: 1) our partnership with states in
priority setting and implementation of enforcement programs; 2) our
efforts to maintain a level of consistency across state programs and
our Regional offices; and 3) our work to identify impediments to
performance and devise resource strategies targeted at those areas.
I am particularly appreciative of the report's acknowledgement of the
substantial progress we have made in terms of priority setting and
planning with the states, and our use of the State Review Framework
(SRF) to enhance our ability to evaluate and oversee state enforcement
programs. In both instances, we have used a collaborative approach, one
we will continue to employ as we work to fill remaining data gaps,
enhance our relationships with states, and develop innovative resource
approaches. The Agency looks forward to a continued dialogue with you
and your staff as we embark on these important efforts.
Our detailed comments on the draft report are attached. If you have any
questions, please contact me at 564-2440 or your staff may contact
Gwendolyn Spriggs in our Immediate Office at 564-2439.
Sincerely,
Signed By:
Catherine R. McCabe:
Principal Deputy Assistant Administrator:
Attachment:
[hyperlink, http://www.epa.gov]:
Recycled/Recyclable:
Printed with Vegetable Oil Basel Inks on 100% Postconsumer, Process
Chlorine Free Recycled Paper:
[End of section]
Appendix IV: GAO Contact and Staff Acknowledgments:
GAO Contact:
John B. Stephenson (202) 512-3841 or stephenson@gao.gov:
Staff Acknowledgments:
In addition to the individual named above, Ed Kratzer, Assistant
Director; Charles W. Bausell, Jr; Kevin S. Bray; Brian M. Freidman;
Carol M. Henn; Tom M. James; Ralph L. Lowry; Lynn M. Musser; Carol H.
Shulman; John C. Smith; and Ignacio J. Yanes made key contributions to
this report.
[End of section]
FOOTNOTES
[1] Such injunctive relief includes the authority to order a party that
is violating a provision of the law to refrain from further violation
and to take action to abate or correct the noncompliance.
[2] "Indian country" includes all land within the limits of an Indian
reservation under the jurisdiction of the United States government and
all dependent Indian communities within the borders of the United
States.
[3] GAO, Environmental Protection Agency: Protecting Human Health and
the Environment Through Improved Management, GAO/RCED-88-101
(Washington, D. C.: Aug. 16, 1988); GAO, Environmental Protection:
Collaborative EPA-State Effort Needed to Improve New Performance
Partnership System, GAO/RCED-99-171 (Washington, D.C.: June 21, 1999);
EPA Office of Inspector General, EPA Needs Better Integration of the
National Environmental Performance Partnership System, No. 2000-M-
000828-000011 (Washington, D.C.: Mar. 31, 2000); National Academy of
Public Administration, Environment.Gov: Transforming Environmental
Protection for the 21st Century (Washington, D.C.: November 2000); GAO,
Environmental Compliance and Enforcement: EPA's Effort to Improve and
Make More Consistent Its Compliance and Enforcement Activities, GAO-06-
840T (Washington, D.C.: June 2006).
[4] GAO, Clean Water Act: Improved Resource Planning Would Help EPA
Better Respond to Changing Needs and Fiscal Constraints, GAO-05-721
(Washington, D.C.: July 22, 2005).
[5] These three programs are the Clean Water Act--National Pollutant
Discharge Elimination System; Clean Air Act--Stationary Sources
Program; and Resource Conservation and Recovery Act--Subtitle C
Hazardous Waste Program.
[6] For purposes of this report, state agencies include those of the
District of Columbia, Puerto Rico, the U.S. Virgin Islands, and the
Pacific Islands.
[7] GAO, Federal-State Environmental Programs--The State Perspective,
CED-80-106 (Washington, D.C.: Aug. 22, 1980).
[8] GAO/RCED-88-101.
[9] ECOS is the national nonprofit, nonpartisan association that
represents state and territorial environmental commissioners.
[10] State pollution control associations are national, nonpartisan
professional organizations representing state and local pollution
control officials. They include, for example, the Association of State
and Territorial Solid Waste Management Officials (ASTSWMO), Association
of State and Interstate Water Pollution Control Administrators
(ASIWPCA), and the National Association of Clean Air Agencies--formerly
known as State and Territorial Air Pollution Program Administrators,
and Association of Local Air Pollution Control Officials (STAPPA/
ALAPCO).
[11] The review elements are based upon compliance and enforcement
policies that have been in place for many years, such as EPA's national
enforcement response policies, compliance monitoring policies, civil
penalty policies, and similar state policies (where in use and
consistent with national policies).
[12] When we refer to "real terms," we mean after subtracting out the
effect of inflation, i.e., growth in prices. Trends in spending of
nominal amounts (also called current dollar or then-year values) may
reflect changes in both price and quantity. To evaluate real spending
trends, it is necessary to remove the effect of changes in prices. The
effect of inflation is removed by deflating the series, a process that
requires dividing the nominal value by an appropriate price index. The
resulting series can be labeled real, inflation-adjusted, or constant
dollars. This report used the Gross Domestic Product (GDP) price index
to deflate the nominal dollar amounts of budget authority amounts and
arrive at inflation adjusted (or real) dollars in 2007 dollars.
[13] The Resource Conservation and Recovery Act of 1976, Pub. L. No. 94-
580, 90 Stat. 2795, amends the Solid Waste Disposal Act, Pub. L. No. 89-
272, tit. II, 79 Stat. 997 (1965), the first federal law regulating
solid wastes--a broad category of materials including such materials as
garbage from treatment plants and discarded materials resulting from
industrial, commercial, or agricultural activities.
[14] Precise information about the overall changes in region and state
enforcement workload associated with the implementation of new
requirements--such as information on changes in the numbers of
regulated entities--is not available. However, we and others have
reported over the years on the impact of changes in the federal
environmental programs to the requirements for EPA's and authorized
states' enforcement programs. GAO-05-721; Congressional Research
Services, RL30798, Environmental Laws: Summaries of Statutes
Administered by the Environmental Protection Agency (updated Mar. 31,
2005).
[15] GAO-06-840T.
[16] Water Quality Act of 1987, Pub. L. No. 100-4, 101 Stat. 7.
[17] Clean Air Act Amendments, Pub. L. No. 101-549, 104 Stat. 2399
(1990).
[18] GAO, Clean Air Act: EPA Should Improve the Management of Its Air
Toxics Program, GAO-06-669 (Washington, D.C.: June 23, 2006).
[19] Title III of the 1990 amendments directs EPA to impose technology-
based standards, or Maximum Achievable Control Technology (MACT)
standards, on industry to reduce emissions. These technology-based
standards require the maximum degree of reduction in emissions that EPA
determines achievable for new and existing sources, taking into
consideration the cost of achieving such reduction, health and
environmental impacts, and energy requirements.
[20] The agency faces court-ordered deadlines to complete standards for
all of the remaining 54 source categories of small stationary sources
by June 15, 2009.
[21] Under Title V of the Clean Air Act, sources emitting pollutants
above certain thresholds are classified as "major sources" and must
obtain Title V operating permits. In addition, most major sources must
report their aggregate annual emissions to their state air quality
agency and pay fees based partly or entirely on their level of
emissions. Sources that emit pollutants below major source thresholds
are called "minor sources" and do not have to obtain a Title V permit.
Some minor sources, called "synthetic minors," have the potential to
emit pollutants at major source levels but choose to limit their
operations and emit below these thresholds.
[22] GAO, Air Pollution: EPA Should Improve Oversight of Emissions
Reporting by Large Facilities, GAO-01-46 (Washington, D.C.: April
2001).
[23] GAO-01-46.
[24] The Hazardous and Solid Waste Amendments of 1984, Pub. L. No. 98-
616, 98 Stat. 3221.
[25] Pub. L. No. 109-58, 119 Stat. 594.
[26] The act allows EPA to extend the first 3-year period for up to 1
additional year if an authorized state demonstrates that it has
insufficient resources to complete all inspections within the first 3-
year period.
[27] The Leaking Underground Storage Tank Trust Fund, as established in
1986, provided funds to states specifically for cleaning up
contamination from tanks (i.e., releases or leaks). Prior to the Energy
Policy Act of 2005, states could not use the money for inspections or
enforcement of leak detection and prevention requirements.
[28] Association of State and Territorial Solid Waste Management
Officials also received a collective recommendation from the Northeast
Waste Management Officials' Association (NEWMOA), a nonprofit,
nonpartisan interstate association that has a membership composed of
the hazardous waste, solid waste, waste site cleanup and pollution
prevention program directors for the environmental agencies in eight
New England States (Connecticut, Maine, Massachusetts, New Hampshire,
New Jersey, New York, Rhode Island, and Vermont)
[29] As we reported in June 2006, EPA has long experienced difficulties
in providing oversight of state enforcement programs with sufficient
consistency.
[30] EPA Office of Inspector General, Water Enforcement: State
Enforcement of Clean Water Act Dischargers Can Be More Effective, Audit
Report No. 2001-P-00013 (Washington, D.C.: Aug. 14, 2001).
[31] GAO-06-840T.
[32] GAO/RCED-00-108.
[33] For the purposes of this report, state agencies include those of
the District of Columbia, Puerto Rico, and the U.S. Virgin Islands, and
the Pacific Islands.
[34] The term "differential oversight" refers to a mechanism through
which the compliance and enforcement program can offer differing levels
of oversight based on EPA's assessment of state performance. States
demonstrating an adequate core compliance and enforcement program would
qualify for benefits while state performance not meeting minimum
standards would result in enhanced oversight. This process does not
negate EPA's responsibility for oversight; it simply determines the
level, intensity, and focus of the oversight.
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