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56 FR 49376-49381 Friday, Sept. 27, 1991 Issuance of and Administrative Hearings on RCRA Section 9003(h) Corrective Action Orders for Underground Storage Tanks

49376 - 49381 Federal Register / Vol. 56, No. 188 / Friday, September 27, 1991 / Rules and Regulations

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 24

[FRL-4012-4]

Issuance of and Administrative Hearings on RCRA Section 9003(h)

Corrective Action Orders for Underground Storage Tanks

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

SUMMARY: The Hazardous and Solid Waste Amendments of 1984 (HSWA) added to the Resource Conservation and Recovery Act (RCRA) a new Subtitle I which provides for the regulation of underground storage tanks CUSTS). Section 9003(h), which was added to Subtitle I by the Superfund Amendments and Reauthorization Act of 1986 (SARA), authorizes EPA to issue orders requiring owners and operators to take corrective action in response to releases from their USTS. This rule establishes procedures governing the issuance of administrative corrective action orders issued under authority contained in section 9003(h) of RCRA, and conduct of administrative hearings requested by recipients of such orders.

EFFECTIVE DATE: This rule becomes effective October 28, 1991.

FOR FURTHER INFORMATION CONTACT: RCRA/SUPERFUND Hotline at (600) 424-9346; or in Washington, DC at (202) 382-3000.

SUPPLEMENTARY INFORMATION: The contents of today's preamble are listed in the following Outline:

I. Authority

II. Background

A. Subtitle I of RCRA

B. Summary of Proposed Rule

III. Analysis of Today's Rule

A. Statutory Mandate

B. Due Process Issues

C. Procedures for the Hearing Process

IV. Economic and Regulatory Impacts

A. Regulatory Impact Analysis

B. Regulatory Flexibility Act

C. Paperwork Reduction Act

List of Subjects in 40 CFR Part 24

I. Authority

The rules governing issuance of and administrative hearings on corrective action orders, 40 CFR part 24, were promulgated on April 13,1988, at (53 FR 12256), under the authority of sections 2002 and 3008 of the Solid Waste Disposal Act, commonly referred to as the Resource Conservation and Recovery Act, (RCRA), as amended by the Hazardous and Solid Waste Amendments of 1984 (HSWA)), 42 U.S.C. 6912 and 6928. This amendment to 40 CFR part 24 is issued under the authority of sections 2002 and 9003 of RCRA, as amended, 42 U.S.C. 6912 and 69gib.

II. Background

A. Subtitle I of RCRA

On November 8, 1984, the President signed into law the Hazardous and Solid Waste Amendments of 1984. The amendments added to RCRA a new Subtitle 1, sections 9001 through 9010, which establishes a federal program for the regulation of underground storage tanks (USTs). Section 9006(a) authorizes EPA to issue administrative orders that require compliance and/or assess penalties for violations of Subtitle 1. Section 9003(h) authorizes EPA to issue administrative orders requiring owners or operators of leaking USTs to undertake corrective action.

Under section 9(b), any administrative order issued under section 9006(a) shall become final in 30 days unless the recipient requests an administrative hearing. Section 9003(h) states that corrective action orders issued under section 9003(h) shall be subject to the same requirements as 9006(a) orders. Thus, recipients of 9003(h) corrective action orders maintain the right for 30 days to request a hearing.

The procedures for issuing administrative compliance orders and conducting administrative hearings pursuant to RCRA section 3008(a) are governed by 40 CFR part 22. On February 24, 1988, EPA amended the part 22 procedures to include orders issued pursuant to section 9006(a) (53 FR 5373). The Agency subsequently developed more streamlined procedures at 40 CFR part 24 for corrective action orders issued pursuant to section 3008(h) of RCRA. These streamlined procedures were published April 13,1988 (53 FR 12256) and applied to 3008(h) corrective action orders only.

In the absence of Congressional requirements, the Agency has the ability, circumscribed by constitutional due process considerations, to decide what administrative procedures are appropriate to be followed for 9003(h) corrective action orders. Because EPA believes that the part 24 procedures are consistent with the statute and its goal of minimizing the environmental risks posed by leaking USTS, it feels that part 24 should be employed for corrective action orders issued pursuant to section 9003(h) and for administrative hearings requested by recipients of such orders. Thus, EPA proposed that the part 24 procedures be amended to include corrective action orders issued pursuant to section 9003(h). The proposed amendment was published in the Federal Register on August 15, 1990 (55 FR 33430) along with an invitation to interested members of the public to comment on the proposed rule.

B. Summary of Proposed Rule

EPA believes that use of the part 24 procedures is the most appropriate way to handle the issuance of and administrative hearings on 9003(h) corrective action orders and, thus, proposed to extend the scope of part 24 to include such orders. The Agency believes that the uncomplicated, streamlined nature of the administrative procedures under part 24 make it more suitable than part 22 for issuing corrective action orders. The primary difference between the two sets of proceedings is that part 22 requires full, adjudicatory hearings with discovery and examination of witnesses, while part 24 provides instead for the respondent's full review of the administrative record. Other differences between the proceedings are illustrated in the flowcharts (Figure 1).

Flowchart

Because of their nature and purpose, part 24 proceedings are less formal and resource-intensive than part 22 proceedings. In part 22, EPA decision makers are required to adjudicate specific factual issues relating to the violation in question. However, the primary purpose of part 24 proceedings is to establish that a release has occurred, not that a specific violation has occurred, and to determine the most appropriate corrective measures for the release. Because the part 24 proceedings do not allow examination and cross examination of witnesses, less time and fewer resources are needed for preparation and conduct of the hearings. This approach is congruous with the UST program's philosophy, where the primary goals include reducing the risks from UST releases as quickly as possible. Thus, EPA believes that using part 24 procedures for 9003(h) corrective action orders would avoid unnecessary time delays and expenditures of Agency or respondent's resources, and would provide a more suitable framework for issuing corrective action orders than would the part 22 procedures.

In its August 1990 proposal, the Agency's intent was to amend 40 CFR part 24 by expanding the scope of coverage of the rule to include 9003(h) orders. Consistent with use of part 24 for RCRA section 3008(h) orders, EPA proposed that the part 24 procedures be used only when issuing a 9003(h) corrective action order alone. If a 9003(h) corrective action order is issued in conjunction with a 9006 order to compel compliance with specific requirements or to assess civil penalties, the part 22 procedures will be followed. This allows for the full adjudicatory proceedings under part 22 in those cases where issues of fact are most likely to be in dispute. Table 1 illustrates when to follow part 22 and part 24 procedures.

TABLE 1

Type of order Procedures to use
Section 9003(h) Corrective Action Order requiring investigations, studies, and/ or corrective action. 40 CFR part 24.
Section 9003(h) Corrective Action Order issued in conjunction with a 9006(a) Compliance Order requiring compliance with specific requirements. 40 CFR part 22.
Section 9003(h) Corrective Action Order issued in conjunction with a section 9006(a) Compliance Order assessing civil penalties. 40 CFR part 22.
Section 9006(a) Compliance Order requiring compliance with specific requirements and/or assessing civil penalties. 40 CFR part 22.

EPA also proposed to amend part 24 by selecting the appropriate hearing procedures (section 24.08) for 9003(h) corrective action orders. The rules at 40 CFR part 24 use a two-tiered set of procedures for conducting administrative hearings. The two tiers are: (1) Subpart B-Hearings on Orders Requiring Investigations or Studies; and (2) Subpart C-Hearings on Orders Requiring Corrective Action. Subpart B procedures are used when the initial RCRA section 3008(h) corrective action order directs the respondent to undertake either: (1) Studies of the nature and extent of releases of hazardous waste constituents; or (2) studies of the available alternatives for remediating such releases, either alone or with limited interim corrective action measures. Procedures in subpart C are used when the initial 3008(h) corrective action order directs the respondent to undertake specific, comprehensive corrective measures, either alone or in conjunction with investigatory studies. EPA proposed that the subpart C procedures be used for 9003(h) corrective actions orders, including those rare instances when an order would be issued that did not instruct the owner or operator to conduct corrective measures.

III. Analysis of Today's Rule

A number of comments on the proposed rule were received from representatives of the regulated community and trade associations. While the basic approach and structure of the rule remain unaltered, the comments have prompted the Agency to make certain changes to the rule. A summary of EPA's response to the major comments and a discussion of the revisions to the rule are provided below. The full comment response document is available in the UST docket. Call (202) 475-9720 to make an appointment with the docket clerk.

A. Statutory Mandate

The issue raised most frequently by commenters addressed the Agency's interpretation of RCRA section 9003(h)(4), which requires that 9003(h) orders be subject to the "same requirements" as 9006 orders. The commenters argued that since EPA uses the part 22 procedures to issue 9006 orders, and not those in part 24, the part 22 procedures also should apply to 9003(h) orders.

The Agency disagrees that section 9003(h) requires that part 22 procedures be used for corrective action orders. The statute, at section 9003(h)(4), states that corrective action orders "shall be issued and enforced in the same manner and subject to the same requirements as orders under section 9006," but does not provide any reference to the procedures as part 22. Thus, EPA believes that the statutory reference to "the same requirements" is directed toward the requirements in section 9006 itself, and not the requirements in the part 22 procedures that EPA has chosen to implement section 9006. There are three requirements set forth in section 9006(b):

- Respondent must be guaranteed a public hearing;

- Respondent has 30 days to request a hearing before the order becomes final; and

- EPA "may" promulgate rules for discovery procedures.

The part 24 procedures provide for due process through a public hearing (see discussion below) and allow the respondent 30 days to request such a hearing and, therefore, fulfill the requirements of section 9006(b). With respect to the statutory language for discovery procedures, it should be noted that the statute says that the Agency 11 may" promulgate discovery rules, clearly suggesting that hearings which did not contain this feature also would be acceptable. Thus, because the part 24 procedures meet the requirements set forth in section 9006, their use is permitted by the statute, regardless of the fact that the part 22 procedures were chosen to implement orders under section 9006.

This interpretation is consistent with EPA's previous rulemaking to establish the part 24 procedures for RCRA section 3008(h) corrective action orders (53 FR 12256, April 13, 1988). In addition, the use of part 24 procedures for 3008(h) corrective action orders has been upheld in a recent court decision, Chemical Waste Management Inc. v. United States Environmental Protection Agency, 873 F.2d 1477 (D.C. Cir. 1989). The court ruled that because the statute did not specifically reference the part 22 procedures, the Agency's use of part 24 procedures for hearings on corrective action orders under section 3008(h) reflects a reasonable interpretation of the statute.

One commenter also suggested that section 9003(h)(4) only provides authority to issue corrective action orders for releases from petroleum USTS. The Agency disagrees, because section 9003(h)(4) also includes orders "to carry out regulations under subsection (c)(4) of this section," and that section (and the regulations issued pursuant thereto) includes both petroleum and hazardous substance USTS. Therefore, the Agency is promulgating the rule as proposed.

B. Due Process Issues

A number of commenters expressed concern that the procedures under part 24 would deprive recipients of 9003(h) orders of due process. In particular, commenters were concerned about the respondent's right to discover the government's evidence or cross-examine government witnesses, and to appeal the order. Commenters also requested clarification on whether orders would be judicially reviewable.

The Agency's argument that part 24 procedures do provide due process for corrective action orders was initially set forth in the preamble to the final rule on use of part 24 procedures for RCRA section 3008(h) orders (53 FR 12256, April 13, 1988). In that preamble, the Agency weighed the factors cited in Mathews v. Eldridge, 424 U.S. 319 (1976), which established how much process is due in an administrative hearing. Those factors were, on the one hand, EPA's interest in avoiding (1) resource outlays and (2) delays in responding to releases that would result from the preparation for and participation in full adjudicatory hearings, and, on the other hand, (1) the respondent's costs of undertaking corrective action, and (2) the risk that the respondent might be forced to incur such costs unnecessarily, because EPA has promulgated rules that do not adequately provide for resolution of factual disputes. The Agency concluded in the preamble that given the technical nature of corrective action cases, the part 24 proceedings would provide adequate resolution of technical disputes and, thus, the risks to the respondent would be minimal. In addition, the corrective action regulations in Subpart F of 40 CFR part 280, with which section 9003(h) orders must be in conformity, provide direction to the issuer of the order and thus reduce the likelihood of error and, consequently, the need for a hearing. Furthermore, lengthy administrative proceedings would be resourceintensive and incompatible with the Agency's need to accomplish clean-ups quickly to avoid adverse health and environmental impacts. EPA's argument that part 24 procedures provide due process has been upheld in Chemical Waste Management Inc. v. EPA, in which the court declared that use of part 24 procedures for RCRA 3008(h) corrective action orders did not on their face deprive respondents of the constitutional requirement of due process.

Specifically, although cases involving corrective action orders may present some factual issues for resolution, there will be fewer factual issues than in cases where there are alleged regulatory violations. Furthermore, the questions that do arise will be more technical in nature, and will focus on whether a release has occurred and what remediation should be undertaken, rather than on specific factual issues needed to prove whether a violation has occurred. Such technical questions can just as easily, and perhaps more effectively, be resolved through careful analysis of the administrative record and the written submissions and oral statements of the parties. Thus, formal discovery will not be necessary because part 24 provides the respondent with full access to the administrative record. The part 24 regulations also provide several opportunities for a closer examination of difficult factual issues, such as liability for corrective action. Specifically, § § 24.11 and 24.15(a) allow the Presiding Officer to address questions to either party; § 24.11 (Subpart B) provides opportunity for technical and legal discussions between the parties; and § 24.24(d) (Subpart C) allows the respondent (with the Presiding Officer's permission) to submit questions in writing to EPA prior to the hearing. Thus, lengthy administrative hearings that include extensive discovery and cross-examination not only are incompatible with the need to accomplish clean-ups quickly, but also are unnecessary from a due process standpoint.

The Agency believes that the part 24 proceedings also provide due process with respect to appeals. In particular, part 24 allows the respondent to identify and bring to the attention of the Regional Administrator any factual or legal errors in the recommended decision, prior to the final decision. Thus, final decisions issued under the part 24 procedures already incorporate review and approval by the Regional Administrator. Furthermore, the Agency is clarifying that the final decision made by the Regional Administrator after the conclusion of the hearing to either sign or modify the Presiding Officer's decision is final Agency action that is not appealable to the Administrator. However, the final order is not judicially reviewable until the agency seeks to enforce the order or until the order has been fully implemented, because the statute, in the opinion of the Agency, precludes pre-enforcement or preimplementation review. In addition, the completion of the dispute resolution process does not permit immediate judicial review, for the same reasons that a final order is not immediately reviewable by the courts.

C. Procedures for the Hearing Process

The rules at 40 CFR part 24 use a twotiered set of procedures for conducting administrative hearings. Subpart B procedures, which are less formal and time-consuming, are used when the initial corrective action order directs the respondent to undertake either studies of the nature and extent of releases, or studies of the available alternatives for remediating such releases. Subpart C procedures are used when the initial corrective action order directs the respondent to undertake specific or comprehensive corrective measures.

In the preamble to the proposed rule, EPA suggested that 9003(h) corrective action orders will be issued primarily in situations when a release is suspected to have occurred. In these cases, the Agency typically will issue a single order requiring the owner or operator both to confirm the release and to conduct corrective measures. The Agency also indicated that procedures for hearings requested by the recipients of such orders would be more appropriately governed by the subpart C procedures. Thus, the Agency proposed that the subpart C procedures be used for all 9003(h) corrective actions orders, including those rare instances when an order would be issued that did not instruct the owner or operator to conduct corrective measures. However, several commenters disagreed with the Agency's intent to issue single orders for both the investigation and clean-up phases of UST remediation. In general, the commenters indicated that such orders would be unfair to respondents and would be inconsistent with the Agency's procedures for RCRA section 3008(h) orders.

With respect to releases from USTS, the statute at section 9003(h) provides Regional enforcement officers with the choice of issuing either a single or joint order. Because 9003(h) orders usually will be issued in response to releases of known substances (i.e., petroleum or chemical products that contain hazardous substances), no detailed studies or extensive site investigations will be needed to characterize the substances released. Thus, the Agency maintains that a typical 9003(h) order will either require corrective action only, or will require investigations and studies along with a directive that corrective action must be undertaken, if necessary, based on the results of those studies.

Consistent with the comments received, the Agency does acknowledge that there may be circumstances when an order would be issued for investigation/study only. The comments received on the proposed rule indicated that there was confusion as to whether subpart B or subpart C would be used in those circumstances. To resolve this confusion, the Agency determined that it would be appropriate to make the rule consistent with the procedures for 3008(h) orders. Thus, EPA revised the rule to clarify that subpart B procedures would be used in situations when an order compels an investigation/study only, while subpart C would be used for joint orders or corrective action only (see Table 2).

TABLE 2

Action required § 3008(h) orders § 9003(h) orders
Site investigation only. Subpart B procedures Subpart B procedures.
Corrective action only. Subpart C procedures. Subpart C procedures.
Site investigation and corrective action. Subpart C procedures. Subpart C procedures.

IV. Economic and Regulatory Impacts

A. Regulatory Impact Analysis Under Executive Order No. 12291, the Agency must determine whether a new regulation is a "major" rule and prepare a Regulatory Impact Analysis (RIA) in connection with a major rule. A "major" rule is defined as one that is likely to result in: (1) An annual effect on the economy of $100 million or more; (2) a major increase in costs or prices for consumers, individual industries, federal, state, and local government agencies or geographical regions; or (3) significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of U.S.-based enterprises in domestic or export markets. The notice published here is procedural in nature, will not have any important economic impacts, and will not significantly affect the operations of regional or other program offices, Therefore, today's rule is not deemed to be a "major" rule and, accordingly, does not trigger the requirement that a regulatory impact analysis be prepared.

B. Regulatory Flexibility Act The Regulatory Flexibility Act (5U.S.C. 601 et seq.) requires the Agency to prepare and make available for public comment a regulatory flexibility analysis that describes the impact of a proposed or final rule on small entities (i.e., small businesses, small organizations, and small governmental jurisdictions). No regulatory flexibility analysis is required if the head of an agency certifies the rule will not have significant economic impact on a substantial number of small entities. Since this amendment merely establishes hearing procedures and has no significant economic impact on a substantial number small entities, it does not trigger the requirement in the Regulatory Flexibility Act that a regulatory flexibility analysis be prepared.

C. Paperwork Reduction Act

This final amendment contains no information collection requirements and thus will not increase the paperwork burden on the regulated community in contravention of the purposes of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.

List of Subjects in 40 CFR Part 24

Administrative practice and procedure, Corrective action, Hazardous materials, Revocation of operating authority; Underground storage tanks.

Dated: September 17, 1991.

William K. Reilly,

Administrator.

For the reasons set out in the Preamble, part 24, Chapter 1, of Title 40, Code of Federal Regulations is amended as follows:

PART 24 -[AMENDED]

1. The authority citation for part 24 is revised to read as follows:

Authority: 42U.S.C. sections 6912, 6928, 6991b.

2. Section 24.01is amended by redesignating paragraph (c) as (d) and by revising paragraph (a) and adding paragraph (c) to read as follows:

§ 24.01 Scope of these rules.

(a) These rules establish procedures governing issuance of administrative orders for corrective action pursuant to sections 3008(h) and 9003(h) of the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act (the Act), and conduct of administrative hearings on such orders, except as specified in paragraphs (b)

and (c) of this section.

* * * * *

(c) The hearing procedures appearing at 40 CFR part 22 govern administrative hearings on any order issued pursuant to section 9003(h) of the Act that is contained within an administrative order that includes claims under section 9006 of the Act.

* * * * *

3. Section 24.02 is amended by revising paragraph (a) to read as follows:

§ 24.02 Issuance of initial orders; definition of final orders and orders on consent.

(a) An administrative action under section 3008(h) or 9003(h) of the Act shall be commenced by issuance of an administrative order. When the order is issued unilaterally, the order shall be referred to as an initial administrative order and may be referenced as a proceeding under section 3008(h) or 9003(h) of the Act. When the order has become effective, either after issuance of a final order following a final decision by the Regional Administrator, or after thirty days from issuance if no hearing is requested, the order shall be referred to as a final administrative order. Where the order is agreed to by the parties, the order shall be denominated as a final administrative order on consent.

* * * * *

4. Section 24.04 is amended by revising paragraph (a) to read as follows:

§ 24-04 Filing and service of orders, decisions, and documents.

(a) Filing of orders, decisions, and documents. The original and one copy of the initial administrative order, the recommended decision of the Presiding Officer, the final decision and the final administrative order, and one copy of the administrative record and an index thereto must be filed with the Clerk designated for 3008(h) or 9003(h) orders. In addition, all memoranda and documents submitted in the proceeding shall be filed with the clerk.

* * * * *

5. Section 24.08 is revised to read as follows:

§ 24.08 Selection of appropriate hearing procedures.

(a) The hearing procedures set forth in subpart B of this part shall be employed for any requested hearing if the initial order directs the respondent ----

(1) To undertake only a RCRA Facility Investigation and/or Corrective Measures Study, which may include monitoring, surveys, testing, information gathering, analyses, and/or studies (including studies designed to develop recommendations for appropriate corrective measures), or

(2) To undertake such investigations and/or studies and interim corrective measures, and if such interim corrective measures are neither costly nor technically complex and are necessary to protect human health and the environment prior to development of a permanent remedy, or

(3) To undertake investigations/ studies with respect to a release from an underground storage tank.

(b) The hearing procedures set forth in subpart C of this part shall be employed if the respondent seeks a hearing on an order directing that ----

(1) Corrective measures or such corrective measures together with investigations/studies be undertaken, or

(2) Corrective action or such corrective action together with investigations/studies be undertaken with respect to any release from an underground storage tank.

(c) The procedures contained in subparts A and D of this part shall be followed regardless of whether the initial order directs the respondent to undertake an investigation pursuant to the procedures in subpart B of this part, or requires the respondent to implement corrective measures pursuant to the procedures in subpart C of this part.

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