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UST/LUST Enforcement Procedures Guidance Manual OSWER Directive 9610.11 May 1990

Directive Organization

NOTICE

NOTE: The document you are viewing is an HTML facsimile of OSWER Directive 9610.11 that has been reformatted for the Internet. This version maintains as much as possible of the original document integrity. Only a couple of non-essential elements are missing, namely facsimiles of the OSWER Directive cover page, and EPA Form 1315-17 (the Directive Initiation Request). Also, the original typed document had the directive number as a header on each page--in this version the directive number appears at the beginning of each new section.

NOTICE

The procedures set forth in this document are intended solely for the guidance of U.S. EPA Regional enforcement staff. They are not intended, and cannot be relied on, to create rights, substantive or procedural, enforceable by any party in litigation with the United States. The U.S. EPA reserves its right act at variance with this guidance and to change it at any time without public notice.

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OSWER DIRECTIVE 9610.11

CHAPTER 1. OVERVIEW OF THE UST/LUST ENFORCEMENT PROGRAM

The Hazardous and Solid Waste Amendments (HSWA) of 1984 added Subtitle I to the Resource Conservation and Recovery Act (RCRA). Subtitle I established a national regulatory program for the control of underground storage tank (UST) systems used to store liquid petroleum or chemicals defined as hazardous substances.

(Footnote 1) In addition, the Superfund Amendments and Reauthorization Act of 1986 (SARA) established a response program for releases of petroleum from USTs and created the leaking underground storage tank (LUST) Trust Fund. In both the regulatory and release response programs, the U.S. Environmental Protection Agency (the U.S. EPA, or the Agency) is encouraging States to develop and implement their own programs in lieu of the Federal program, provided that a State has regulations that are no less stringent than the Federal regulations and can take adequate enforcement actions. States that have fulfilled the State program approval criteria will have primary responsibility for enforcing against owner/operators suspected of violating UST requirements (although, prior to approval, States may already be taking actions against violators of the existing State regulations). Furthermore, States may respond to releases and may access the LUST Trust Fund provided they have demonstrated sufficient capability and have negotiated Cooperative Agreements with the U.S. EPA. In some cases, however, States may require assistance from the U.S. EPA in taking enforcement actions.

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OSWER DIRECTIVE 9610.11

1.1 PURPOSE OF THE MANUAL

The purpose of this manual is to provide guidance for enforcement personnel on undertaking actions in response to violations of UST technical regulations and corrective action requirements. It is intended to accompany the draft U.S. EPA Penalty Guidance for Violations of UST Regulations, which provides guidance for U.S. EPA Regional enforcement staff on calculating administrative penalties to be assessed against violators of the UST regulations.

This manual is intended primarily for use by U.S. EPA Regional offices that need to take enforcement actions in States with or without approved programs. However, it may also be used by State program officials who wish to develop State enforcement programs similar to the Federal program. The manual generally deals with violations and releases involving USTs containing petroleum, although USTs containing hazardous substances are briefly addressed in Chapter 2. It is organized as follows:

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OSWER DIRECTIVE 9610.11

1.2 OVERVIEW OF THE UST/LUST ENFORCEMENT PROGRAM

Because of the size and nature of the regulated community, the U.S. EPA has developed a non-traditional regulatory approach in which the national UST program is implemented primarily at the State and local levels. Presently, there are about two million regulated UST systems in the country at over 700,000 facilities. Owners and operators of these facilities include large oil companies; independent marketers and gasoline stations; Federal, State, and local governments; and other entities such as trucking fleets and bus companies that use petroleum in their businesses. A significant portion of this diverse regulated community includes the small, independently-operated service stations and convenience stores that are accustomed to operating with minimal environmental regulation. Unlike the larger businesses, these smaller businesses may have difficulty with compliance because of their limited resources and knowledge of the Federal regulations. Furthermore, the regulation of the UST population is complicated by the wide array of regulations that address the life cycle of a tank from installation to closure.

To handle the environmental threat posed by this large and diverse community, the Agency has adopted the "franchise" management approach, in which U.S. EPA Headquarters and the Regions, as "franchisers," support State and local programs, the "franchisees." The Agency believes that because State and local agencies have greater interaction with the regulated UST facilities, they are best able to provide the UST population with the technical assistance and attention necessary to ensure compliance. In addition, State and local agencies are better situated to assess the needs of the regulated community, respond to owner/operators, and create a visible presence in the regulated community. Furthermore, States have at their disposal a number of effective regulatory mechanisms (such as building permits, fire codes, and some informal enforcement tools) that are not readily available to the Agency.

To implement the "franchise approach," U.S. EPA's Office of Underground Storage Tanks (OUST) is encouraging States to seek approval for administering their own UST/LUST programs in lieu of the Federal program. The Agency's regulations for State program approval set forth at 40 CFR 281 specify the requirements that a State must fulfill for approval to administer its UST program (see also the State Program Approval Handbook). (Footnote 2) In addition, States are authorized to respond to releases under Section 9003(h)(7) of RCRA provided that they demonstrate capabilities to carry out these actions and enter into Cooperative Agreements with the U.S. EPA.

An important component of an approved UST program is the State's ability to take "adequate enforcement" responses against owner/operators found to be out of compliance with the regulations. Many State and local programs have already developed enforcement programs and have achieved high levels of compliance by providing information and technical assistance to owner/operators in order to prevent violations, and by carrying out informal enforcement responses when violations do occur. Even though they may not yet have program approval, some States already have regulations similar to the Federal regulations (or may have broader pollution control statutes), and are taking formal enforcement actions against violations of these regulations (or statutes). Furthermore, States that do not have their own regulations may have transition agreements that allow them to assist the Agency in taking actions against violators of the Federal regulations.

Enforcement actions taken by States, however, will not always be sufficient to compel compliance. Thus, although the U.S. EPA encourages States to develop and undertake their own formal enforcement programs, there will be some situations in which it may be necessary to transfer the case to the U.S. EPA Regional office. In general, these situations fall into two program areas: (1) release response, and (2) regulatory. The specific situations under which this may occur are discussed in Chapter 2, "Situations Appropriate to Regional Enforcement Actions."

In responding to releases, Federal enforcement actions will be governed by the Agency's Guidance for Conducting Federal-Lead UST Corrective Actions (OSWER Directive 9360.0-16A, June 1988). (Footnote 3) This guidance specifies three conditions that must be present in an UST release situation in order for Federal enforcement actions to be appropriate: (1) the release poses a major public health or environmental emergency; (2) the State or the owner/operator is unable to respond; and (3) the State has requested assistance from the U.S. EPA.

In the regulatory program, it may also be necessary at times for the Agency to take enforcement actions in States. For example, in the early stages of the franchise program, States will be in the process of developing authorities and regulations that are no less extensive and stringent than the Federal regulations. During this developmental period, however, a State may discover a violation for which it does not yet have the appropriate enforcement authority. In such a situation, the State, perhaps after taking steps to encourage the owner/operator to come into compliance, may wish to refer the case to the U.S. EPA. The Agency may also get involved in a State enforcement case if it appears that the case could establish a national legal precedent. In addition, a State may refer a case to the U.S. EPA because the case is politically sensitive in that State (e.g., if the owner/operator is a major business in that State or is a Federal facility). Because the U.S. EPA has limited resources for taking enforcement actions, however, the Agency will use discretion in taking over cases referred from States. Furthermore, when the Agency does take enforcement action in a State, it must coordinate activities with the State in order to avoid possible duplication, to present a uniform approach to UST owner/operators, and to maintain State cooperation.

The specific procedures for initiating and accepting a referral will vary from State to State. Each State/Federal enforcement agreement should specify the process for case referral (see U.S EPA's "Policy Framework for State/EPA Enforcement Agreements," Office of Enforcement, August 1986). Once a case is referred, however, Regional enforcement personnel should keep the State informed of the status of the case. The U.S. EPA's "Policy Framework for State/EPA Enforcement Agreements" identifies several ways in which the Agency can maintain State presence in a case, including:

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OSWER DIRECTIVE 9610.11

1.3 REGULATIONS OF USTS UNDER SUBTITLE I

Pursuant to Section 9003 of Subtitle I, the U.S. EPA established requirements for leak detection, leak prevention, corrective action, and financial responsibility for USTs. (Footnote 4) These requirements were finalized in two separate U.S. EPA rules: the UST technical standards and financial responsibility rules. The discussions that follow summarize each rule. The purpose of these two rules is to reduce the number of releases of petroleum and hazardous substances from USTs, minimize the contamination of soil and ground water caused by such releases, and ensure adequate cleanup of contamination. The requirements in these rules replaced the Interim Prohibition requirements for non-deferred tanks, which prohibited the installation of new unprotected or bare steel tanks. However, Interim Prohibition requirements will remain in effect for those tanks that have been deferred from coverage under the technical standards rule (deferred tanks are listed in the preamble of the final rule).

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OSWER DIRECTIVE 9610.11

1.3.1 Summary of the Technical Standards Rule

The regulations establishing technical standards for USTs emphasize leak prevention, detection, and corrective action. The rule covers the following five areas:

For the reader's convenience, the following discussions provide a brief overview of the specific requirements that an UST owner/operator must follow to be in compliance with the regulations. However, it should be noted that the following summary is not exhaustive, and many exceptions apply. Specific requirements are detailed in the regulations.

UST Design, Construction, Installation, and Notification (Subpart B). In the technical standards rule, specific requirements for both new and existing USTs are addressed separately. For new UST systems, the design, construction, and performance standards must meet approved industry practices. New USTs are also required to have corrosion protection for tanks and piping (unless the site is approved for noncorrosivity), or be constructed of a non-corrodible material. In addition, tanks must be equipped to prevent spills and overfills. Finally, all new tank installations must be performed according to approved industry practices and manufacturer's instructions, and certified by one of the methods listed in the rule.

The requirements for existing USTs emphasize tank upgrading. Existing USTs must be either closed, replaced with new tanks, or upgraded to new tank standards by December 22, 1998. Upgrading requirements for existing USTs include the following:

Notification requirements apply to both new and existing USTs. Under the rule, the UST owner/operator is required to report the following information to the implementing agency: tank type, location, age, use, and methods of compliance with requirements for installation certification, corrosion protection, release detection, and financial responsibility. In addition, the owner/operator must notify the implementing agency if a tank is removed from service or has a change in use.

UST System Operation and Maintenance and Repairs (Subpart C). Operation and maintenance requirements ensure the proper performance of all USTs and auxiliary equipment through testing and recordkeeping practices. Requirements under the technical standards rule include proper operation, maintenance, and inspection of spill and overfill and corrosion protection equipment, as well as recordkeeping of performance of the equipment listed above. The owner/operator must also be sure the tank material or lining is compatible with the substance stored in the tank. To ensure that repaired USTs are operating properly, all UST system repairs must be made according to approved industry practices. Repairs are prohibited, however, for all metal pipe sections and fittings from which product has been released; these parts must be replaced. All USTs with repaired or replaced parts are required to be tightness tested to ensure that the UST system is operating properly.

Release Detection and Recordkeeping (Subpart D). An approved method of release detection is required for all new petroleum tanks and piping at installation, and for all existing tanks and piping, phased in over a 1- to 5-year period according to the tank's age. New USTs containing hazardous substances are required to have double-walled tanks and piping with interstitial monitoring for tanks and piping. Release detection equipment for all UST systems must be installed, calibrated, operated, and maintained in accordance with the manufacturer's instructions. Recordkeeping regulations require the UST owner/operator to maintain records demonstrating the methods of compliance with requirements for installation, corrosion protection, release detection, maintenance, and repairs. Records must also be maintained on the performance of release detection and spill and overfill equipment.

Release Reporting, Investigation, and Corrective Action (Subparts E and F). Release reporting, investigation, and corrective action requirements are designed to ensure a fast and appropriate response to all suspected and confirmed releases from USTs. Under the technical standards rule, an UST owner/operator must report to the implementing agency within 24 hours of any release of regulated substances at the site or in the surrounding areas, unusual operating condition of the tank or equipment, monitoring results indicating that a release may have occurred, or spills or overfill. Suspected releases must be immediately investigated, and the owner/operator is required to begin corrective action as soon as a release has been confirmed.

Initial release response actions required by the rule include preventing further release of the regulated substance into the environment, and identifying and mitigating any fire, explosion, and acute vapor hazards. Within 20 days of release confirmation, the responsible owner/operator is required to report to the implementing agency on initial abatements steps taken and any resulting data. Within 45 days, the owner/operator must report on the initial site characterization and the free product removal efforts. If remediation is necessary, the owner/operator will also be required to submit a corrective action plan for approval by the implementing agency.

Out-of-Service UST System Operation and Maintenance and Closure (Subpart G). An owner/operator of an UST taken out of service for less than 3 months must continue all operation and maintenance procedures. If a tank is taken out of service temporarily (i.e., for 3 to 12 months), the owner/operator must also secure and cap all ancillary equipment and leave vent lines open and functioning. Any tank that is taken out of service permanently (i.e., for more than 12 months) and does not meet new tank standards (for example, leak detection, corrosion protection, spill and overfill protection requirements, etc.) must be upgraded to meet these new tank standards or be permanently closed. For permanent tank closure, the owner/operator is required to:

Prior to a change in service (e.g., continued use of an UST system to store a non-regulated substance), the tank must be emptied and cleaned, and a site assessment must be conducted.

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OSWER DIRECTIVE 9610.11

1.3.2 Summary of the Financial Responsibility Rule

The financial responsibility rule requires owner/operators of petroleum USTs to demonstrate financial assurance of their abilities to undertake corrective action and compensate third parties for bodily injury and property damage in the event of a petroleum UST release. The final rule covers the following three areas: (1) level of financial responsibility; (2) financial responsibility mechanisms; and (3) reporting and recordkeeping. The financial responsibility requirements will be phased in over a 36-month period, based on the number of tanks and ownership classification (e.g., marketer, non-marketer, or municipality).

Level of Financial Responsibility. Under the final rule, the owner/operator of an UST containing petroleum is required to demonstrate the following types and amounts of financial assurance:

Owner/operators are required to demonstrate both types of financial assurance. Financial assurance must be reviewed by the owner/operator, and must be increased, if necessary, whenever new or additional USTs are acquired or installed.

Financial Responsibility Mechanisms. An UST owner/operator may demonstrate financial responsibility through use of one, or a combination, of the following mechanisms: (Footnote 5)

Reporting and Recordkeeping. The owner/operator of an UST must maintain copies of the financial assurance mechanism(s) used to comply with financial responsibility regulations at the UST site or their place of business. The owner/operator must report evidence of financial responsibility to the implementing agency in the following situations:

The provider of financial assurance is required to notify the UST owner/operator and implementing agency of plans to cancel the assurance in order to allow time for the owner/operator to secure alternate coverage.

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OSWER DIRECTIVE 9610.11

1.4 RELEASE RESPONSE PROGRAM UNDER SUBTITLE I

The 1984 HSWA amendments to RCRA, while creating a national regulatory program for USTs under Subtitle I, did not provide the U.S. EPA with the authority to respond to UST leaks or spills. To address this need, SARA added RCRA Section 9003(h), which established a program for responding to petroleum releases from USTs. In addition, Section 522 of SARA amended the Internal Revenue Code to create the LUST Trust Fund to be used to finance cleanups of releases from petroleum USTs. The release response program and the LUST Trust Fund are different in nature from the regulatory program established under Subtitle I. The initial UST program was established and currently operates primarily as a preventive program, while the LUST program is a response program designed to facilitate the cleanup of petroleum leaks and spills from USTs.

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OSWER DIRECTIVE 9610.11

1.4.1 Release Response Authorities

A fundamental element of the cleanup program established by SARA is the provision of authority to the Agency, under Section 9003(h), to respond to releases from USTs through enforcement activities, corrective actions, and cost recovery. These activities may be financed by the LUST Trust Fund, which was created through a 1/10 of one cent per gallon excise tax on motor fuels that is expected to generate $500 million in the first 5 years. Specifically, Section 9003(h)(4) enables the Agency (or States, under Cooperative Agreements with the U.S. EPA) to issue corrective action orders requiring owner/operators of leaking USTs to carry out corrective action or closure activities. In addition, Section 9003(h)(2) allows the Agency to take corrective action in response to a petroleum release from an UST. Activities such as exposure assessment, the provision of alternative water supplies, and the relocation of affected residents, are considered allowable corrective action activities under Section 9003(h)(5). The U.S. EPA or the State may undertake such corrective action activities using the LUST Trust Fund when one or more of the following situations exist:

The U.S. EPA or the State may also undertake corrective action if the owner/operator has failed to comply with financial responsibility requirements, provided that the site warrants action according to the U.S. EPA's or the State's priority system for LUST Trust Fund corrective actions. (Footnote 6) According to Section 9003(h)(11), U.S. EPA and State priority systems must reflect the use of funds at sites where:

Section 9003(h)(6) provides the Agency with the authority to take action against responsible owner/operators to recover costs incurred by the U.S. EPA or the State while carrying out corrective action and enforcement activities. In determining the level of cost recovery, the Agency or State may consider the liability level set forth in the financial responsibility regulations (except where the owner/operator failed to maintain the required levels of financial responsibility), as well as other factors. The U.S. EPA's Cost Recovery Policy for the Leaking Underground Storage Tank Trust Fund (OSWER Directive 9610.10, October 1988) addresses this issue in detail.

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OSWER DIRECTIVE 9610.11

1.4.2 State Role in the LUST Trust Program

As with the UST regulatory program, States will play the primary role in implementing the LUST program in all areas, including enforcement. Under Section 9003(h)(7), States may undertake corrective action, issue corrective action orders, and recover costs provided that the State has entered into a Cooperative Agreement with the U.S. EPA. The Agency has issued guidelines governing LUST Trust Fund Cooperative Agreements (LUST Trust Fund Cooperative Agreement Guidelines, OSWER Directive 9650.10, February 1989). Through these Cooperative Agreements, States are responsible for establishing site priorities; investigating sites and conducting assessments; pursuing and ordering corrective actions by responsible parties; determining appropriate technologies for effective action; conducting cleanups; and pursuing cost recovery. Because most States have Cooperative Agreements at this time, the U.S. EPA's involvement in enforcement actions in release situations will occur mainly when States request the Agency's assistance with difficult cases. Since the effective date of the financial responsibility regulations (January 24, 1989), States that enter into Cooperative Agreements must begin cost sharing with the Federal government. Under the Cooperative Agreement guidelines, States are expected to pay 10 percent of the total program budget of Cooperative Agreements.

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OSWER DIRECTIVE 9610.11

CHAPTER 2. SITUATIONS APPROPRIATE TO REGIONAL ENFORCEMENT ACTIONS

Under the national UST program, the U.S. EPA is encouraging States to take primary responsibility for enforcing their own UST/LUST programs in lieu of the Federal program. The Agency anticipates that as States continue to expand their enforcement programs, its primary role will be to provide leadership and assistance to States. However, the Agency has identified several scenarios where Federal involvement in State enforcement cases may be necessary (FY 1989-FY 1990 Compliance and Enforcement Strategy for the Underground Storage Tank Program, OSWER Directive 9610.8, January 1989). This chapter discusses those situations.

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OSWER DIRECTIVE 9610.11

2.1 ACTIONS TAKEN IN STATES WITH INADEQUATE ENFORCEMENT AUTHORITY

While many States already have active, comprehensive UST programs, other States may still be in the process of setting up programs or obtaining new legislation. If a State lacks UST-specific enforcement authority, it may be necessary at times for the U.S. EPA Regional office to carry out an enforcement action in that State. For example, the U.S. EPA Regional office and the State may decide together that the Agency's involvement is necessary to achieve the desired response from the noncomplying owner/operator. Upon referral from the State, the U.S. EPA will assume enforcement responsibility when a State requests such assistance from the Agency.

In taking enforcement actions in a State, the Region's level of response will vary depending upon the State program's level of development and the severity of the violation. For example, if a State is at the initial stages of program development, the Region may focus its resources on helping the State develop a State-specific compliance and enforcement program that includes communication and outreach to educate owner/operators about the Federal regulations (OSWER Directive 9610.8). However, the Region will maintain the option to take direct enforcement actions in the State, and have the option of establishing a Federal presence in the State through both informal and formal enforcement actions. Informal actions (e.g., requests for information) would serve to deter potential violators, and may provide an example to the State as it builds and improves its UST program.

Regional involvement may also be necessary in a State that has a more developed UST program but still lacks the enforcement authority applicable to a given violation of the Federal regulations (OSWER Directive 9610.8). For example, a State may have taken informal responses to compel compliance (e.g., through warning letters) but may have found that these actions were ineffective. If the State lacks the authority to undertake more formal enforcement actions, it may then request assistance from the Agency. In such a case, the Agency may wish to implement the necessary formal enforcement measures to deter potential violators while encouraging the State to acquire the necessary enforcement authorities. The Agency may choose, for example, to take over a case where the violation threatens human health and the environment (e.g., in the case of a release, or a violation of leak detection requirements). In addition, the Agency will continue to work with the State to build its program capabilities and resolve enforcement issues.

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OSWER DIRECTIVE 9610.11

2.2 ACTIONS TAKEN IN APPROVED STATES

A State that has an approved program may still encounter certain enforcement situations in which U.S. EPA involvement would be beneficial. OUST's compliance and enforcement strategy (OSWER Directive 9610.8) describes a number of situations in which the U.S. EPA may become involved in an enforcement case in a State with an approved program. In general, the U.S. EPA may become involved because: (1) the State lacks the authority to assess an administrative penalty; (2) the State requests Federal assistance in an enforcement case that involves a Federal facility or other politically sensitive entity; and (3) the situation involves a major public health or environmental emergency.

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OSWER DIRECTIVE 9610.11

2.2.1 Actions Taken in States Without Administrative Penalty Authority
One reason that a State may request the Agency's involvement in an enforcement case is to assess administrative penalties. The State Program Approval regulations (40 CFR Part 281) require States to have the authorities necessary to assess civil penalties (up to $5,000 or more per tank per day for each violation), but do not require States to have authority to issue administrative compliance orders and assess administrative penalties. Nevertheless, a number of States do have the authority to issue administrative orders, and have found such orders to be an effective tool for achieving compliance. Although a State may use administrative orders primarily to compel compliance, it may encounter violation cases in which it would be appropriate to assess a penalty in conjunction with the order. If the State UST implementing agency does not have administrative penalty authority, it must petition the Attorney General's office to assess such administrative penalties. Because this process can be time consuming, a State may request that the U.S. EPA Regional office assess administrative penalties.

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OSWER DIRECTIVE 9610.11

2.2.2 Cooperative Actions Against Violators
Even if a State has sufficient authorities for taking enforcement actions in most of its cases, it still might request the U.S. EPA to assist the State in enforcing certain cases. For example, a State might prefer that the Agency become involved in an enforcement action against an owner/operator that is considered to be economically or politically vital to the State, such as a corporation that employs a large number of State residents or in multi-state actions.

A State may also request Agency involvement in an enforcement action against a Federal facility. Should the U.S. EPA be called upon to undertake enforcement action at a Federal facility, the appropriate guidance may be found in the Federal Facilities Compliance Strategy (also known as the "Yellow Book"), rather than this manual. (Footnote 7) The "Yellow Book" establishes the current Agency-wide approach for handling violations at Federal facilities. According to that document, Federal facilities must comply with the Federal requirements under most environmental statutes, and also with all applicable State and local laws and regulations to the same extent as non-Federal entities. If a Federal facility within a certain State violates environmental statutes or regulations, the State and the Agency may share certain responsibilities for carrying out enforcement activities.

In the UST program in particular, a State that has received program approval may take the lead in responding to violations at Federal facilities. However, the U.S. EPA retains the legal authority and responsibility to enforce Federal law at a Federal facility. The FY 1989-FY 1990 Compliance and Enforcement Strategy for the Underground Storage Tank Program (OSWER Directive 9610.8) sets forth three situations in which the U.S. EPA may take enforcement actions against a Federal facility: (1) the State lacks adequate enforcement authorities and capabilities; (2) the State requests the Agency to take the lead role or cooperate in a joint action; or (3) there are other appropriate circumstances consistent with the "Yellow Book." Arrangements for State and/or U.S. EPA involvement and cooperation in enforcement efforts at a Federal facility should be clearly outlined in State/Federal enforcement agreements that can be incorporated into the Cooperative Agreement, or, if the State has an approved program, in the Memorandum of Agreement between the State and the Agency.

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OSWER DIRECTIVE 9610.11

2.2.3 Actions Taken in Response to a Major Public Health or Environmental Emergency
A State may require U.S. EPA assistance in a case that involves a major public health or environmental threat or emergency. States, under Cooperative Agreements, will be expected to initiate and pursue enforcement actions as necessary to compel owner/operators to mitigate releases. However, as set forth in the Guidance for Conducting Federal-Lead Underground Storage Tank Corrective Actions (OSWER Directive 9360.0-16, June 1988), Federal-lead enforcement may be appropriate where: (1) a release from an UST poses a major public health or environmental emergency; (2) the State can demonstrate lack of capability or authority; and (3) the State requests Federal assistance for an eligible site.

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OSWER DIRECTIVE 9610.11

2.3 ACTIONS TAKEN ON INDIAN LANDS

The Agency's policy for managing any environmental regulatory program on Indian lands is set forth in the "EPA Policy for the Administration of Environmental Programs on Indian Reservations" (November 1984) and the accompanying "Indian Policy Implementation Guidance." The fundamental principle of these documents is that the Agency will pursue the goal of Indian "self-government," and will work with Tribal governments on a one-to-one basis as sovereign entities.

Because they are not States, Indian Tribes cannot be approved to operate their programs in lieu of the Federal program, even though they may have parallel UST programs. Furthermore, States generally do not have jurisdiction over Indian lands unless the State and the Tribe have such an agreement. To address the issue of UST releases on Indian lands, the U.S. EPA has developed the Interim Guidance for Conducting Federal-Lead UST Corrective Actions for Petroleum Releases on Indian Lands (OSWER Directive 9610.9, July 1989), which discusses situations in which it is appropriate for the Agency to take action against UST releases on Indian lands. However, no guidance currently exists for taking enforcement actions on Indian lands in response to violation in the preventative program.

As set forth in the Agency guidance (OSWER Directive 9610.9), Federal-lead involvement in corrective actions on Indian lands is limited to cases in which (1) there is a serious "time critical" threat to human health and the environment; (2) the Tribe is unable to respond; and (3) the owner/operator is unable or unwilling to provide an adequate and timely response. It should be noted that the guidance set forth in the document is directed toward short-term remediation only. Long-term corrective action guidance will be developed (if necessary) once the Agency has determined the extent of the UST problem on Indian lands. To assist with this determination and provide Tribes with technical assistance, the Agency is funding compliance assistance and outreach activity pilot projects in several U.S. EPA Regions.

In general, the criteria for determining Federal-lead corrective action at a violating UST facility on Indian lands are broader than those specified for non-Indian facilities. National U.S. EPA policy encourages direct dialogue and the sharing of technical assistance with Tribal authorities to encourage the facility to achieve compliance.

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OSWER DIRECTIVE 9610.11

2.4 ACTIONS RESULTING FROM PROGRAM OVERLAP

One final area in which Regional enforcement may be required is in response to releases of hazardous substances from USTs. SARA established a release response program under Section 9003(h) of RCRA and created the LUST Trust Fund for financing cleanups of petroleum UST releases. However, the response program and the Trust Fund may only be used for petroleum releases. Although the majority of regulated tanks contain petroleum, about 5 percent contain hazardous substances. For this small tank population, responsibility for leaks of hazardous substances and cleanup of these releases will be decided on a site-specific basis.

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OSWER DIRECTIVE 9610.11

CHAPTER 3. ENFORCEMENT CASE DEVELOPMENT

Under the national UST program, States are encouraged to take the primary responsibility for responding to violations of the UST requirements. Because of the size and nature of the UST regulated community, the U.S. EPA is focusing its enforcement efforts on encouraging voluntary compliance through informal enforcement actions, and is working with States to strengthen their enforcement programs. However, the Agency does intend to take stricter, more resource-intensive actions when necessary. Subtitle I of RCRA provides U.S. EPA Regional enforcement personnel with an array of possible responses for carrying out this enforcement approach. This chapter provides guidance on determining the appropriate level of enforcement response and describes procedures for taking specific initial enforcement actions. The more traditional administrative and judicial enforcement actions are described in Chapters 4, 5, and 6.

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OSWER DIRECTIVE 9610.11

3.1 OVERVIEW OF ENFORCEMENT TOOLS

The purpose of any enforcement response is to bring about compliance with the regulations and to deter future violations, or, in the case of a release, ensure proper corrective action. To encourage voluntary compliance in the UST community, the least resource-intensive action should be taken first. Enforcement personnel should then increase the severity of the enforcement action if the lower level of enforcement fails to achieve the desired response. The following section (Section 3.2) discusses the factors to be considered in determining the appropriate level of enforcement. Once this level is determined, the enforcement actions that may then be taken usually fall under one of the following separate, but often interrelated, tracks: (1) actions taken to achieve compliance (for violations of the technical regulations); and (2) actions taken to achieve corrective action (when the violation also involves a release). Sections 3.3, 3.4, and 3.5 describe various enforcement techniques that can be taken in each of these situations. In addition, Section 3.6 describes alternative enforcement tools that may be used to achieve quicker resolution of the violation or release situation.

The processes described in this chapter represent some of the enforcement techniques that are presently being used in the Regions, and should not be considered the only, or the most appropriate, means of addressing violations. Because the UST technical regulations have only been in effect for a relatively short period of time, UST enforcement staff have not had the opportunity to develop and experiment with different enforcement techniques. However, as the Regional experience in enforcing against UST violations increases, the enforcement processes are expected to be improved and refined over time. Furthermore, some Regional enforcement personnel may have already developed similar or more effective means of carrying out these initial enforcement activities. Therefore, this guidance will be reviewed each year and modified as appropriate, to keep it current with new information and changes to the program.

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OSWER DIRECTIVE 9610.11

3.2 FACTORS TO CONSIDER IN DETERMINING RESPONSE LEVEL

In determining the appropriate enforcement action for any violation of environmental regulations, enforcement personnel should consider the goals of the "Agencywide Compliance and Enforcement Strategy" (U.S. EPA, Office of Enforcement, May 1984): The level of enforcement required to achieve these goals will vary depending on the severity of the violation, priorities established between the Regions and the States, and other circumstances of the case. The selection of the appropriate enforcement response may also be affected by the penalty policy currently being developed.

The Agency has identified a number of factors to be considered in determining the appropriate level of response ("Working Principles Underlying EPA's National Compliance/Enforcement Programs," November 1983 and "Strategy Framework for EPA Compliance Programs," U.S. EPA, Office of Enforcement, May 1984). For cases involving noncompliance with the UST regulations, factors that should be considered are: (1) the seriousness of the violation; (2) the circumstances of the violation; and (3) information about the owner/operator. In addition, enforcement personnel should take into account the likelihood that a response may establish a good or bad precedent. Although not all of the information required to evaluate these factors will be available at the time that an enforcement response must be taken, enforcement personnel should attempt to consider these factors to the greatest extent possible when making their decision. These factors are discussed in more detail below.

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OSWER DIRECTIVE 9610.11

3.2.1 Severity of the Violation
Considerations that should be made in determining the severity of the violation include: In determining the appropriate response for a release that threatens human health or the environment, additional considerations include: (1) amount of petroleum or hazardous substance potentially or actually released; (2) toxicity of petroleum or hazardous substance released; (3) sensitivity of the environment in which the released occurred; and (4) duration of the release.

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OSWER DIRECTIVE 9610.11

3.2.2 Circumstances of the Violation
In determining the appropriate level of action for other types of violations, enforcement personnel should take into account the culpability of the owner/operator (i.e., whether the violation could have been prevented or whether it was beyond the owner/operator's control). In addition, enforcement personnel should consider whether the owner/operator made any efforts to identify, report, and correct the violation, independent of the enforcement response. Such positive reinforcement of "self-monitoring" will help encourage voluntary compliance.

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OSWER DIRECTIVE 9610.11

3.2.3 Information About the Owner/operator
Information about the owner/operator includes the economic benefit of noncompliance accrued by the owner/operator, the facility's compliance history, the owner/operator's ability to pay, and the size of the business. If information on these points is available, enforcement personnel should consider using it in choosing an enforcement response. For example, a history of noncompliance is considered a negative element, and an owner/operator that has a poor compliance record should be met with stronger enforcement actions. Certain considerations, such as the economic benefit of noncompliance and an owner/operator's ability to pay will require further research and are often taken into account when a penalty is assessed; however, this should not delay action taken by the Region. The burden to establish an inability to pay is on the owner/operator.

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OSWER DIRECTIVE 9610.11

3.3 ENFORCEMENT ACTIONS FOR VIOLATIONS OF THE TECHNICAL REGULATIONS

Under the authorities in RCRA Section 9005 and Section 9006, Agency enforcement personnel may take the following actions in response to a violation of the technical regulations: (Footnote 8) Each of these is discussed below. As previously discussed, the appropriate level of this initial response will depend upon the circumstances of the case (for example, more serious cases may warrant skipping the less severe actions). Although most enforcement cases will go through the same general steps when enforcement responses increase in severity, the Agency's response in an individual case will depend on the actions already taken by the State (e.g., the Agency may begin directly with an administrative response if the State has determined that informal actions were ineffective).

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OSWER DIRECTIVE 9610.11

3.3.1 Information Request
RCRA Section 9005 (42 U.S.C. §6991d) authorizes the U.S. EPA to require an UST owner or operator to furnish information in the context of enforcing the provisions of Subtitle I and its implementing regulations. Therefore, to obtain additional information on a potential violation of the technical regulations, the Agency may issue a Section 9005 information request letter to an owner/operator. In response to such a request, the UST owner/operator must provide U.S. EPA Regional enforcement personnel with any information that they have requested on the UST system. The UST owner/operator must also allow the Agency to conduct monitoring or testing, and must provide Agency personnel with access to all records relating to the tanks. (Thus, in view of the statutory authority behind these "requests," it may be more appropriate to view them as "demands.") Monitoring, testing, and record reviews typically provide the Agency with the information necessary to determine that a violation has, in fact, occurred. In general, collection and documentation of information may also be necessary to support the development of an enforcement case. The amount and type of data that must be collected, however, will vary depending on the data collected during the inspection and any previous follow-up work conducted by the State.

A letter of request for information should be issued in cases where a violation is apparent but where substantially more evidence is required before an appropriate response can be determined (e.g., before deciding to draft an administrative order). A typical information request letter should include the following information: (Footnote 9)

In general, the request for information may be sent by first class mail unless the owner/operator has not cooperated, in which case it should be sent by certified mail, return receipt requested. In addition, a copy of the letter should be placed in the case file.

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OSWER DIRECTIVE 9610.11

3.3.2 Warning Letter/Notice of Violation (NOV)
Because of the large size of the UST regulated community and the number of owner/operators unaccustomed to being regulated, the Agency is promoting the use of initial enforcement mechanisms that encourage voluntary compliance. In particular, enforcement personnel should initially take actions that serve to notify the owner/operator of the violation, advise what actions are needed to correct the situation, provide a deadline for compliance, and indicate more stringent actions that may be taken if he or she does not respond. Notifications such as warning letters and NOVs are often used to achieve these objectives. Although these notifications are not required prior to taking more formal actions, they do serve as documented evidence of contact with the owner/operator and may be used later to support more severe enforcement actions.

Once enforcement personnel have obtained sufficient information to confirm a violation, the UST owner/operator should be notified that the Agency considers him or her to be in violation of a technical requirement. In general, a notification should contain the following information:

Unlike the information request letter, the notification must be sent by certified mail, return receipt requested. In addition, a copy should be placed in the case file.

The form of the notification may range from informal warning letters to the more authoritative NOVs. (Footnote 10) Warning letters are often considered to be the more informal method of notifying an owner/operator of a potential violation, and may be issued by the inspector at the site or be issued with the inspector's signature. A warning letter typically serves to inform the owner/operator that the implementing agency has been made aware of the situation, and seeks voluntary compliance by indicating what actions should be taken to achieve compliance. A warning letter is generally issued when the violation is minor and cooperation is expected, or when a first-time violator is expected to comply promptly. The warning not only gives the owner/operator a chance to comply, but also provides evidence that informal actions were taken, should more serious enforcement actions be needed later.

The more formal NOVs may be issued if enforcement personnel believe that a stronger initial communication is required. NOVs often follow a more structured format than informal warning letters, and may be signed by an official from the implementing agency. While it still may be considered an informal response, issuing an NOV marks the beginning of the more formal enforcement process -- if the owner/operator fails to adhere to the schedule outlined in the NOV, enforcement personnel may respond with a Section 9006 compliance order or may initiate civil judicial proceedings.

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OSWER DIRECTIVE 9610.11

3.3.3 Administrative Compliance Order
If the initial response actions described above appear to be ineffective, it may be necessary to initiate formal administrative or judicial actions. Under Section 9006(a) of RCRA, the U.S. EPA is authorized to issue administrative orders to compel compliance with any requirements of Subtitle I, including the regulations (at 40 CFR Part 280) promulgated pursuant to Section 9003. These compliance orders are usually issued in non-emergency situations where a return to compliance is expected, and where it appears that the more informal actions (e.g., a warning letter) would be or have been ineffective in bringing about compliance.

A typical compliance order will require that the owner/operator come into compliance immediately or within a reasonable, specified time period. In addition, under RCRA Section 9006(d), the order may also include a civil penalty not to exceed: (1) $10,000 per tank per day for each violation of a requirement or standard at 40 CFR Part 280 or any approved State program; and (2) $10,000 per tank for failure to comply with the notification requirements. Furthermore, the order should also indicate to the owner/operator that continued noncompliance will result in further legal action, including the assessment of additional penalties of up to $25,000 for each day of noncompliance with the compliance order.

The procedures for issuing Section 9006 administrative compliance orders and assessing administrative civil penalties are governed by the Consolidated Rules of Practice Governing the Administrative Assessment of Civil Penalties and the Revocation or Suspension of Permits (the "CROP," 40 CFR Part 22). In addition to a compliance order, the Part 22 procedures can also be used for issuing a Section 9003 corrective action order if it is combined with a Section 9006 compliance order and penalty, and for issuing a Section 9006 order that only assesses a penalty. The specific processes for issuing administrative compliance orders are discussed in Chapter 4, "Procedures for Section 9006 Compliance Orders."

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OSWER DIRECTIVE 9610.11

3.3.4 Judicial Actions
In addition to administrative responses, U.S. EPA Regional enforcement personnel may initiate civil judicial action under RCRA Section 9006(a). Judicial actions are more formal actions initiated in the U.S. Court system by the Department of Justice. To initiate the judicial action, the Agency must deliver a written referral to DOJ formally requesting that a suit be filed by DOJ on behalf of the U.S. EPA. The procedures for developing this referral are discussed in Section 6.1.2 of Chapter 6, "Procedures for Judicial Enforcement."

Because the litigative process can be both time-consuming and resource-intensive and because the issuance of an administrative order will increase the strength of a judicial case, judicial referral does not usually begin unless administrative responses have been found to be ineffective or inappropriate. Judicial actions may be taken without the prior issuance of an administrative order in emergency situations and cases where the owner/operator has a history of noncompliance. The judicial actions that U.S. EPA Regional enforcement personnel may take are:

There may also be circumstances in which a criminal action is appropriate.

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OSWER DIRECTIVE 9610.11

3.4 ENFORCEMENT ACTIONS FOR RELEASES NOT REPORTED BY AN OWNER/OPERATOR

When it has been determined that a release from an UST has occurred, the primary goal of an enforcement response is to encourage an owner/operator to conduct corrective action. However, the specific enforcement response taken may differ depending on whether the owner/operator has reported the release (in which case a violation may not necessarily be involved) or whether the implementing agency has discovered the release by some other means. The discussion that follows describes enforcement tools used when the release is not reported by the owner/operator. Enforcement actions that should be taken when the release has been reported by the owner/operator are described in Section 3.5 below.

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OSWER DIRECTIVE 9610.11

3.4.1 Information Request Letter/On-site Inspection
If the release was reported by someone other than the owner/operator, the implementing agency may have general information on the location and extent of the release, but may have to determine the source of the release as well as the identity of the owner/operator. As discussed in Section 3.3.1 above, RCRA Section 9005(a) authorizes U.S. EPA Regional enforcement personnel to issue an information request letter that requires an owner/operator to provide information on his or her tank system. Furthermore, Section 9005 provides the Agency with access to a site for the purpose of responding to a release. Activities authorized under this section include: (1) inspection of tanks and associated equipment; (2) inspection of soils, air, surface water, and ground water; (3) tank tests; and (4) sampling. In addition, an owner/operator must provide Agency personnel with access to all records relating to such tanks. These activities will aid enforcement personnel in confirming the release and determining its source.

In determining the source of a release, proper procedures for documenting the investigation of a release must be followed to ensure that the data may be used in an administrative or judicial proceeding. In particular, the inspector must be prepared to give expert testimony, because if formal actions are taken, the owner/operator is likely to hire a contractor to provide testimony to dispute the Agency's findings and enforcement response. The U.S. EPA's guidance manual for inspectors, Fundamentals of Environmental Compliance Inspections (Office of Enforcement, February 1989), provides detailed guidance on collecting and documenting evidence for testimony.

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OSWER DIRECTIVE 9610.11

3.4.2 Notice of Violation
Similar to the NOV for technical violations, once there is sufficient information to confirm a release, enforcement personnel should issue an NOV to notify the UST owner/operator that he or she is expected to comply with the requirements set forth in Subparts E and F of 40 CFR Part 280. The specific requirements under 40 CFR Part 280 are:

The purpose of an NOV is to notify the owner/operator that he or she is responsible for carrying out these actions. If the owner/operator fails to comply with any of these requirements during the course of the corrective action, enforcement personnel may respond with a Section 9003 corrective action order or may initiate civil judicial proceedings.

OSWER DIRECTIVE 9610.11

3.4.3 Corrective Action Order
Under Section 9003(h) of RCRA, the U.S. EPA is authorized to issue corrective action orders to compel an owner/operator of a leaking UST to carry out investigative studies and undertake corrective actions or closure activities. (Footnote 11) Corrective action orders should be used when an UST owner/operator has a confirmed release, and enforcement personnel believe that he or she will respond properly and promptly to the order.

A corrective action order will typically describe the actions that must be taken by the owner/operator (e.g., the release response requirements set forth in Subpart F of the Technical Regulations), provide a specific time period for taking these actions, and indicate the potential consequences of not doing so. As with the compliance order, the corrective action order should also indicate to the owner/operator that continued noncompliance will result in further legal action, including the assessment of additional penalties of up to $25,000 for each day of noncompliance with the corrective action order. As described in Section 3.3 above, enforcement personnel may need to initiate judicial proceedings if the owner/operator continues to be recalcitrant.

The procedures for issuing Section 9003(h) corrective action orders will be governed by the Rules Governing Issuance of and Administrative Hearings on Corrective Action Orders, codified at 40 CFR Part 24. The specific processes for issuing administrative corrective action orders are discussed in Chapter 5, "Procedures for Section 9003 Corrective Action Orders." A corrective action order may also be combined with a Section 9006 order to compel compliance with specific technical requirements or to include the assessment of administrative penalties. In such a case, the requirements at 40 CFR Part 22 would be used.

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OSWER DIRECTIVE 9610.11

3.5 ENFORCEMENT ACTIONS FOR OWNER/OPERATOR-REPORTED RELEASES

If the release was reported by the owner/operator, he or she would have been required to follow the reporting procedures set forth in Subpart F (sections 280.60 - 280.66) of 40 CFR Part 280 (see Exhibit 3.1). Thus, the primary purpose of enforcement responses taken in a case where the release is self-reported is to ensure that the owner/operator carries out the corrective action activities required by the regulations. The enforcement techniques discussed below are typically used when the owner/operator has notified the implementing agency of the release.

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OSWER DIRECTIVE 9610.11

3.5.1 Acknowledgement/Information Request Letter
Acknowledgement letters are sent to the owner/operator by the implementing agency to notify the owner/operator that the appropriate reports have been received. If the necessary reports are due from the owner/operator or incomplete information was received, the Agency may issue an information request letter, as described in Section 3.4.1. These letters may be used to monitor the progress of the site investigation and corrective action.

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OSWER DIRECTIVE 9610.11

3.5.2 Corrective Action Letter
Under 40 CFR section 280.66, the Agency has discretion to require that an owner/operator adhere to a reasonable schedule for the completion of specific corrective action activities. The corrective action letter is a 1 to 2 page letter that notifies the owner/operator of time frames that he or she must use to schedule these corrective action activities. The letter is meant to be informal, and its purpose is to capture the attention of the owner/operator, convey the implementing agency's expected schedule for cleanup, and initiate negotiations.

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3.5.3 Compliance Order
The compliance order is issued to an owner/operator who has failed to comply with the requirements of the corrective action regulations. The compliance order is an administrative order issued under Section 9006 with the intent of assessing penalties, rather than compelling compliance with specific requirements.

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OSWER DIRECTIVE 9610.11

3.6 ALTERNATIVE ENFORCEMENT TOOLS

To create a successful, comprehensive enforcement program, the U.S. EPA must provide the enforcement staff with flexibility in implementing enforcement responses. As discussed above, not all of the techniques described in this manual will be appropriate in all circumstances, and enforcement personnel may wish to develop and implement some alternative enforcement tools to achieve the same objective of compliance. The sections that follow provide examples of some additional enforcement tools that may be used to supplement the basic tools for achieving both compliance with the technical rules and cleanup of a release. These tools may be used alone or in combination with the techniques described in Sections 3.3, 3.4, and 3.5.

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OSWER DIRECTIVE 9610.11

3.6.1 Show Cause Meetings
Once the appropriate owner/operator has been notified of the violation or release, he or she may be provided with an opportunity to meet with enforcement personnel to negotiate a corrective action plan or present any factors related to a technical violation that may mitigate the enforcement response. One method for achieving this is to invite the owner/operator to a "show cause" meeting. The show cause meeting provides the owner/operator with an opportunity to present to the Agency any factors related to the case that might mitigate the Agency's enforcement response and to provide it with an opportunity to gather information and to clarify any factual and legal issues that may have arisen. The show cause meeting is particularly useful when the particulars of a case do not clearly indicate the proper course of action to be followed (i.e., an administrative order, a judicial referral, or no further action). An invitation to the show cause meeting may be included in the NOV or warning letter, but should be sent to the owner/operator as soon as possible after the decision has been made to have such a meeting.

The show cause meeting can be particularly useful in determining the most appropriate course to take in response to a release. Following the report of a release from an UST, the U.S. EPA may either send an information request letter to the owner/operator to confirm the release and seek compliance or, in the case of an emergency, initiate action itself to alleviate any immediate danger to human health and safety. Once the release is confirmed and the site is stabilized, enforcement personnel may decide that it is appropriate to meet with the owner/operator to negotiate an agreement to perform corrective action. This decision will depend upon the owner/operator's compliance with corrective action requirements and cooperation with the Agency during the negotiation process.

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OSWER DIRECTIVE 9610.11

3.6.2 Informal Settlement Conference
Negotiated resolutions of enforcement actions are considered to be a cost-effective means of achieving compliance. The manner in which enforcement personnel negotiate with an owner/operator will vary depending on the type of violation, whether the situation is an emergency, and the willingness of the owner/operator to cooperate. In all cases, however, a limited time frame, whether publicized initially or conveyed to the owner/operator during negotiations, should be developed by the enforcement personnel. This increases the efficiency of the process. It should be noted that to be effective, however, any negotiated agreement must still hold the threat of further action if the owner/operator does not cooperate. To formalize this understanding, informal negotiations may be developed into consent agreements that will be finalized in an administrative order on consent (see Chapter 4).

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OSWER DIRECTIVE 9610.11

CHAPTER 4. PROCEDURES FOR SECTION 9006 COMPLIANCE ORDERS

U.S. EPA enforcement personnel are likely to take administrative actions in response to most violations of the UST requirements when a formal response is appropriate. The Agency is authorized by Subtitle I of RCRA to issue administrative compliance orders under RCRA Section 9006 (usually accompanied by administrative penalties) and administrative corrective action orders under RCRA Section 9003. This chapter discusses the U.S. EPA's authority to take Section 9006 administrative actions and provides guidance on the procedures for issuing administrative orders and assessing administrative penalties. Section 9003 orders are addressed in Chapter 5.

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4.1 FRAMEWORK OF THE ADMINISTRATIVE PROCESS

The discussion that follows provides background on the U.S. EPA's authority to take administrative actions, and discusses the regulations that govern the administrative process. It also provides a brief overview of U.S. EPA administrative roles.

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4.1.1 Statutory and Regulatory Framework
Section 9006(a) of RCRA authorizes the U.S. EPA to issue an administrative enforcement order when it is determined that an UST owner or operator is in violation of Subtitle I or any regulation promulgated pursuant to Section 9003. RCRA Section 9006(d) authorizes the Agency to assess civil penalties of up to $10,000 per tank per day of violation for violations of requirements promulgated under Section 9003. Section 9006(d) also authorizes the Agency to assess civil penalties of up to $10,000 per UST against owners and operators who fail to comply with the notification requirements or submit false information. Civil penalties will normally be assessed for UST violations and accompany a Section 9006(a) compliance order. The procedures for issuing Section 9006 administrative compliance orders and assessing administrative civil penalties are governed by the Consolidated Rules of Practice Governing the Administrative Assessment of Civil Penalties and the Revocation or Suspension of Permits (the "CROP," 40 CFR Part 22). (Footnote 12) The CROP was recently amended to include administrative actions conducted under Section 9006 for violations of Subtitle I. (Footnote 13)

In general, these administrative actions are pursued when an owner/operator has not responded to informal actions or is not expected to comply with informal requests, and the situation does not pose an emergency. If administrative orders are not complied with or if compliance is needed immediately (i.e., in the case of an emergency), enforcement personnel should initiate a civil judicial action under Section 9006(a). The procedures for initiating judicial action are discussed in Chapter 6, "Procedures for Judicial Enforcement."

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4.1.2 U.S. EPA Roles in the Administrative Process
Section 22.04 of the CROP presents the various authorities and duties of the key Agency officials in the administrative litigation process. Some of the roles and responsibilities of the Regional Administrator, the Regional Judicial Officer, and the Presiding Officer include:

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OSWER DIRECTIVE 9610.11

4.2 OVERVIEW OF THE ADMINISTRATIVE PROCESS

Under the procedures set forth in the CROP, the major steps in the litigation process of issuing a Section 9006(a) administrative order are:

The rest of this chapter provides detailed guidance on each of these steps. Because the descriptions below summarize and frequently refer to requirements set forth in the CROP, the reader is advised to obtain a copy of the 40 CFR Part 22 procedures.

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OSWER DIRECTIVE 9610.11

4.3 COMPLAINT PREPARATION AND FILING

Complaint preparation is the first step in the U.S. EPA's adjudicatory process and provides the basis for the initial hearing and any subsequent proceedings. A complaint generally describes the violation, indicates actions needed to come into compliance, and, if appropriate, specifies administrative penalties. Because of the significance of the complaint, it is important to follow the guidance on format and filing of the complaint discussed here and presented in sections 22.05, 22.14, and 22.17 of the CROP.

In order to establish the fundamental case for issuing an administrative order or assessing a civil penalty under Section 9006 of RCRA, enforcement personnel must be able to substantiate in the complaint: (1) that the violation was committed, and (2) that the person charged with the violation is subject to the requirements of the UST regulations. (Footnote 14) Because there are numerous UST requirements, it is important for enforcement personnel to introduce during the hearing any evidence that directly supports or proves each element of the violations charged.

In the written complaint, the Agency must establish each element of the violation, notify the owner/operator of his or her right to a hearing, and, if appropriate, assess a penalty. Pursuant to RCRA Section 9006(c), determination of penalties must take into account the seriousness of the violation and any good faith efforts to comply. (Footnote 15) Under the CROP section 22.14(a), each complaint for the assessment of a civil penalty must include the following items: (Footnote 16)

Because the information in the complaint sets the framework for the administrative process, the complaint must be as complete as possible. Failure to file a complaint that meets the standards and procedures outlined in this section may result in the following: (1) delay the proceedings and prevent the Agency from being granted a motion for default; (2) make the Agency subject to adverse motions by the owner/operator; and (3) negatively affect the Agency's ability to carry the burden of proof.

Section 22.05(b) of the CROP requires the Agency to serve the owner/operator with a copy of the complaint by (1) personal service, or (2) certified mail, return receipt requested. (Footnote 17) The original and one copy of the complaint (with proof of service) must be filed with the Regional Hearing Clerk (section 22.05(a)(1) of the CROP).

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OSWER DIRECTIVE 9610.11

4.4 PRE-HEARING STAGE

Subpart C of the CROP (sections 22.15 to 22.19) sets forth the requirements for the pre-hearing procedures. During the pre-hearing process, the owner/operator may file an answer to the complaint. In addition, the U.S. EPA and the owner/operator may initiate pre-hearing motions and conferences to settle the matter or prepare for an administrative hearing. Failure to follow the procedures within Subpart C of the CROP could impair an otherwise entirely correct proceeding, and may cause the Presiding Officer to dismiss or overturn the action.

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OSWER DIRECTIVE 9610.11

4.4.1 Procedural Requirements for the Pre-hearing Stage
Section 22.05 of the CROP establishes the formatting and filing requirements for any documents established during the pre-hearing stage. These requirements are summarized below.

Format Requirements (section 22.05(c)). A document is considered sufficient for filing if (1) the first page contains a "caption" that identifies the owner/operator and correct docket number; (2) it bears the signature of the filing party, counsel, or other representative; and (3) it bears the name, address, and telephone number of the person filing the document if it is the initial document filed by that person (for exceptions and changes see CROP section 22.05(c)(4)). If these requirements are not met, the Agency official receiving the filing may refuse to accept it until it is properly amended.

Filing Requirements (section 22.05(a)). The original complaint, the answer, and all other documents served in the proceedings are maintained by the Regional Hearing Clerk, with copies given to the Presiding Officer and other parties. (Footnote 18) Any party filing a document after the complaint has been issued must certify that copies of the document have been sent to all other parties and the Presiding Officer (see CROP section 22.05(a)(2)). Subject to confidentiality requirements, the Regional Hearing Clerk must make all documents filed in the proceeding available for public inspection during business hours. The Agency enforcement official initiating the complaint should maintain a separate file containing duplicates of all documents filed in the proceeding, as well as other enforcement documents relating to the case, which include:

This file should be retained in the Region for a minimum of 5 years after termination of the case, after which time it should be transferred to the Records Control Center (Source: RCRA Compliance/Enforcement Guidance Manual (1984), page 7-25).

Ex Parte Discussion. After a complaint has been issued, certain Agency officials are prohibited from discussing ex parte (i.e., without notice to all parties) the merits of the proceeding with individuals or their representatives who have an interest in the proceeding (see CROP section 22.08). Although ex parte discussion is prohibited, if such communication occurs, it is regarded as argument, and a copy of the ex parte communication is served on all other parties in the proceeding. Those other parties are then afforded an opportunity to reply.

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4.4.2 Answer to the Complaint
Procedures for answering a complaint are set forth in section 22.15 of the CROP. The owner/operator must file an answer within 30 days after the complaint has been filed (RCRA Section 9006(b)). Before an answer to the complaint is filed, the RA shall rule on all motions filed or made. After the answer is filed, the Presiding Officer (e.g., Administrative Law Judge) will rule on all motions.

If the owner/operator files the answer on time, the Agency may not seek a motion for default based on the failure to file a timely answer (see CROP section 22.17(a)(1)). Furthermore, the filing of a timely answer limits the U.S. EPA's opportunity to amend since, as a matter of right, the Agency may amend the complaint once before the answer is filed. After that, all motions for amending the complaint must be made to the Presiding Officer (see CROP section 22.14(d)). Before the answer has been filed, the Agency may withdraw the complaint, in its entirety or in part (see CROP section 22.14(e)). After one withdrawal before the filing of an answer, or after the answer has been filed, the complaint may be withdrawn only upon motion granted by the Presiding Officer or RA.

Section 22.05(b) of the CROP sets forth proper contents of an answer. The purpose of the answer may be to contest the material on which the complaint is based, contest the proposed penalty amount, or request a hearing. An insufficient answer may be regarded as an admission of charges not sufficiently discussed (see CROP section 22.15(b)). If the owner/operator fails to file any answer (i.e., to admit, deny, or explain the allegations in the complaint), the Agency will also consider this an admission of the charges and may seek a default order (see CROP section 22.15(d)).

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4.4.3 Pre-hearing Motions
Section 22.16 of the CROP sets forth the procedures for motions in the hearing process. Either the Agency or the owner/operator may make a motion before a hearing is convened, and certain motions must be made during the pre-hearing stage. Motions are either filed with the RA (before the filing of an answer) or with the Presiding Officer (after the filing of an answer).

The following types of motions may be made during the pre-hearing stage of the proceeding:

Pursuant to section 22.16(b) of the CROP, a party's response to any written motion must be filed with the Regional Hearing Clerk within 10 days after the motion has been received, except in the case of a motion for a default order, which specifies a 20-day period for replies. If a response is not filed within the specified time, the motion will be considered waived and may be granted without further argument. Like all documents filed in the proceeding, both the motions and any reply to motions must comply with the filing and service requirements specified by the CROP section 22.05.

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4.4.4 Default Orders
A default order is issued by the RA or Presiding Officer when one of the parties fails to perform a task or obligation of the proceedings. There are three circumstances under which default orders may be issued (see CROP section 22.17(a)):

Motions for default are made either to the RA or Regional Judicial Officer in the first circumstance, or to the Presiding Officer in the second and third circumstances.

The procedures for default are set forth in section 22.17(b) of the CROP. Under these requirements, the party making the motion for default must include with the motion a proposed default order. The motion for default must be served on all parties and conform with the filing and service requirements specified by section 22.05 of the CROP. Under section 22.17(a), the party to whom the default has been served has 20 days to reply to the motion.

If the default order is issued by the Presiding Officer (or the RA or the Regional Judicial Officer, if a timely answer is not filed), it constitutes an "initial decision" of the proceeding. As an initial decision, the default order must meet the requirements of sections 22.17 (b) and (c) of the CROP (also see CROP section 22.27, "Initial Decision"). Section 4.6.5 of this chapter provides further detailed guidance on initial decisions.

The default order becomes the final order of the Administrator within 45 days after its service upon the parties unless: (1) the default order is appealed, or (2) the Administrator elects to review the default order (see CROP section 22.27(c)). The RA or Presiding Officer may motion to set aside the default order (see CROP section 22.17(d)). Any further appeal of the default order must be made directly to the Administrator pursuant to section 22.30 of the CROP.

When the Administrator issues a final order upon default against the owner/operator, he or she is subject to the following consequences:

The admission of factual allegations and the waiver of hearing apply only to the immediate administrative enforcement proceedings and do not affect any other proceedings. When the Administrator issues a final order upon default against the Agency, the complaint is dismissed with prejudice. This means that the Agency cannot file another administrative complaint based on the allegations contained in the dismissed complaint.

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OSWER DIRECTIVE 9610.11

4.4.5 Pre-hearing Conference
Section 22.19 of the CROP sets forth the procedures for the pre-hearing conference. When the hearing is ordered, the Presiding Officer will usually convene a pre-hearing conference to facilitate and expedite the hearing proceeding. These conferences encourage informal, frank discussions among the parties on any subjects that could delay or expedite the hearing. The pre-hearing conference may involve (CROP section 22.19(a)):

During the pre-hearing conference, the parties exchange witness lists, brief descriptions of witness testimony, and copies of all documents and physical evidence that will be introduced into evidence (see CROP section 22.19(b)). Information not exchanged at this conference cannot be introduced into evidence without permission of the Presiding Officer. In some circumstances (e.g., potential intimidation of witnesses), early information exchange should not be undertaken. Section 22.19(f) of the CROP sets forth requirements for further discovery.

Any record of the pre-hearing conference generally consists of a summary prepared by the Presiding Officer that incorporates all rulings or orders and any written stipulations or agreements of the parties. Except for those portions of a pre-hearing conference that relate to settlements, a transcript of the pre-hearing conference may be made (see CROP section 22.19(c)). The transcript or written summary of the pre-hearing conference must be filed with the Regional Hearing Clerk for inclusion in the Regional Hearing Clerk's file.

The Presiding Officer may present an accelerated decision at any time during the proceedings (see CROP section 22.20). If issued, an accelerated decision or dismissal order is treated as an initial decision and, therefore, may be appealed to the Administrator under section 22.30 of the CROP (see discussion in Section 4.6.5 of this chapter on initial decisions). An initial decision must comply with the requirements of section 22.27(a) of the CROP on content, filing, service, and transfer requirements. If a partial decision is rendered, the objecting party, before appealing, must wait for a final initial decision or obtain certification to appeal an interlocutory decision (see CROP section 22.29).

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OSWER DIRECTIVE 9610.11

4.5 SETTLEMENT

As discussed previously, the U.S. EPA encourages settlement of an administrative proceeding provided that the settlement is consistent with the provisions and objectives of RCRA and the UST regulations. Therefore, the Agency's complaint should encourage the owner/operator to negotiate a settlement through informal conferences. An informal settlement conference can be requested at any time, whether or not the owner/operator has requested a hearing (see CROP section 22.18(a)). However, the request for an informal conference does not extend the 30-day period during which the owner/operator must submit a request for a hearing.

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OSWER DIRECTIVE 9610.11

4.5.1 Procedures for Negotiating a Settlement
Section 22.18 of the CROP sets forth the procedures and requirements for settlements. The Agency and the owner/operator can hold a settlement conference before an answer is filed and a Presiding Officer is appointed. After a Presiding Officer has been appointed, however, settlement conferences are subject to the jurisdiction of the Presiding Officer who may order a pre-hearing settlement conference.

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OSWER DIRECTIVE 9610.11

4.5.2 Preparing a Consent Order
Pursuant to CROP section 22.15(b), if the Agency and the owner/operator reach a settlement, they must forward a written consent agreement and a proposed consent order to the RA. The consent agreement is a negotiated settlement agreement between the parties that will be final and binding once it has been incorporated into a consent order that is signed by the RA (see CROP section 22.18(c)). The consent agreement must state that the owner/operator:

The consent agreement must also include any and all terms of the agreement among the parties. Consequently, any terms to which the parties have agreed in reaching a settlement must be reflected in the consent agreement (e.g., agreement by intervenor not to pursue private damage remedies). Partial settlement of the proceedings is permitted and, in many cases, is likely. The consent order eliminates those issues of the proceeding addressed by that order and the consent agreement. Although the consent order does not have to restate all the terms of the consent agreement, it should explicitly incorporate by reference the consent agreement as the basis for the consent order.

The consent agreement and the final consent order constitute important documents that affect the substantive and procedural rights of the parties. Consequently, the originals of these documents must be placed in the Regional Hearing Clerk's file, and copies must be served as required by section 22.06 of the CROP.

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OSWER DIRECTIVE 9610.11

4.6 HEARING STAGE

The Presiding Officer will generally convene a hearing upon request by the owner/operator or if the matter has not yet been disposed of by a default order, accelerated decision, dismissal order, or consent order. If the owner/operator answers the complaint by requesting a hearing, or if the Presiding Officer orders a hearing, the Presiding Officer must issue a notice to all parties 20 days before the hearing (see CROP section 22.21(b)). The Presiding Officer will then hear arguments from both parties during the hearing.

The discussions below describe the key elements of the adjudicatory hearing including admissable evidence, objections, rulings, transcripts, proposed findings, conclusions, initial decisions, and appeals. Procedures for administrative hearings are set forth in Subpart D of the CROP (sections 22.21 to 22.26).

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OSWER DIRECTIVE 9610.11

4.6.1 Admissable Evidence
The U.S. EPA will be the first party to submit evidence during the hearing. In so doing, the Agency must prove that the UST owner/operator was required to comply with UST regulations, that the violations in the complaint did occur, and that the proposed civil penalty is appropriate. After the Agency has submitted evidence, the owner/operator will present any defense to the allegations in the complaint. The Presiding Officer will admit or deny evidence presented by either party pursuant to section 22.22(a) of the CROP. Guidelines for submitting exhibits and physical evidence are found in section 22.22(e) of the CROP.

After both parties have presented their evidence, the Presiding Officer will make decisions on each matter of the complaint. Decisions will be judged upon preponderance of evidence; that is, each party must convince the Presiding Officer that his or her allegations appear more likely or probable than the other party's allegations (see CROP section 22.24).

Evidence Relating to Settlement. Any evidence relating to settlement that would be excluded under Rule 408 of the Federal Rules of Evidence is also excluded under the CROP. The Federal Rules of Evidence generally exclude any evidence of settlement or attempted settlement that it is offered as proof of an admission of liability. This evidence, however, may be admitted for another purpose, such as proving bias of a witness or disproving a contention of undue delay. When such evidence is offered for these purposes, it may still be excluded if the Presiding Officer determines that its substantiating value is outweighed by confusion of issues, undue delay, etc.

Testimony. Witnesses are generally examined orally upon oath or affirmation (except in certain cases as defined in CROP section 22.22(c)). Written statements may be appropriate when the testimony is too technical or academic to be clearly presented through direct questioning. An affidavit may be admitted into evidence when witnesses are unavailable (i.e., if they are exempt by a court order, claim lack of memory, are seriously ill or physically impaired, or are absent despite efforts to secure their attendance).

Subpoenas and Summoning Witnesses. The Presiding Officer may issue a subpoena to require certain witnesses to attend or to produce documentary evidence, or may grant a request for subpoena pursuant to section 22.37(f) of the CROP.

Offers of Proof. When the Presiding Officer rejects submitted evidence, the party seeking to introduce the evidence may not only object to its exclusion, but may also make an offer of proof. An offer of proof places the evidence into the official record, and the Administrator on appeal can use such evidence to reopen the hearing. This offer is subject to requirements under section 22.23 of the CROP.

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OSWER DIRECTIVE 9610.11

4.6.2 Objections and Rulings
Pursuant to section 22.23 of the CROP, either party may object orally or in writing to the conduct of the hearing. The Presiding Officer must rule on all objections and provide reasons for the rulings, which will become part of the record. Copies of the ruling must be served in accordance with section 22.06 of the CROP. A party wishing to appeal the Presiding Officer's ruling on an objection must make a motion in writing within 6 days of notice of the ruling to the Presiding Officer to certify such ruling to the Administrator. (Also see CROP section 22.29(a), "Request for Interlocutory Appeal.")

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OSWER DIRECTIVE 9610.11

4.6.3 Transcript of the Hearing
Pursuant to section 22.25 of the CROP, a hearing must be transcribed verbatim, and the reporter must send the original and copies of the transcript to the Regional Hearing Clerk for filing. The transcript of the hearing is an important document because many objections and motions made during the hearing are oral and are thus reflected only in the transcript