[Federal Register Volume 83, Number 96 (Thursday, May 17, 2018)]
[Notices]
[Pages 22974-22976]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-10568]
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ENVIRONMENTAL PROTECTION AGENCY
[CWA-05-2016-0015; FRL-9978-10-OARM]
Order Denying Petition To Set Aside Consent Agreement and
Proposed Final Order
AGENCY: Office of Administrative Law Judges, Environmental Protection
Agency (EPA).
ACTION: Notice of order denying petition to set aside consent agreement
and proposed final order.
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SUMMARY: In accordance with section 311(b)(6)(C)(iii) of the Clean
Water Act (CWA or Act), notice is hereby given that an Order Denying
Petition to Set Aside Consent Agreement and Proposed Final Order has
been issued in the matter styled as In the Matter of BP Products North
America Inc., Docket No. CWA-05-2016-0015. This document serves to
notify the public of the denial of the Petition to Set Aside Consent
Agreement and Proposed Final Order filed in the matter and explain the
reasons for such denial.
ADDRESSES: To access and review documents filed in the matter that is
the subject of this document, please visit https://yosemite.epa.gov/oarm/alj/alj_web_docket.nsf/Dockets/CWA-05-2016-0015.
FOR FURTHER INFORMATION CONTACT: Jennifer Almase, Attorney-Advisor,
Office of Administrative Law Judges (1900R), Environmental Protection
Agency, 1200 Pennsylvania Ave. NW; telephone number: (202) 564-6255
(main) or (202) 564-1170 (direct); fax number: (202) 565-0044; email
address: [email protected].
SUPPLEMENTARY INFORMATION:
I. Legal Authority
Section 311(b)(6)(A) of the CWA empowers EPA to assess a class I or
class II administrative civil penalty against any owner, operator, or
person in charge of any onshore facility from which oil or a hazardous
substance is discharged in violation of section 311(b)(3), or who fails
or refuses to comply with any regulation issued under section 311(j) to
which that owner, operator, or person in charge is subject (33 U.S.C.
1321(b)(6)(A)). However, before issuing an order assessing a class II
civil penalty under section 311(b)(6), EPA is required by the CWA and
the Consolidated Rules of Practice Governing the Administrative
Assessment of Civil Penalties and the Revocation/Termination or
Suspension of Permits (Rules of Practice) to provide public notice of
and reasonable
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opportunity to comment on the proposed issuance of such order (33
U.S.C. 1321(b)(6)(C)(i); 40 CFR 22.45(b)(1)).
Any person who comments on the proposed assessment of a class II
civil penalty under section 311(b)(6) is then entitled to receive
notice of any hearing held under section 311(b)(6) of the CWA and at
such hearing is entitled to a reasonable opportunity to be heard and to
present evidence (33 U.S.C. 1321(b)(6)(C)(ii); 40 CFR 22.45(c)(1)). If
no hearing is held before issuance of an order assessing a class II
civil penalty under section 311(b)(6) of the CWA, such as where the
administrative penalty action in question is settled pursuant to a
consent agreement and final order, any person who commented on the
proposed assessment may petition to set aside the order on the basis
that material evidence was not considered and to hold a hearing on the
penalty (33 U.S.C. 1321(b)(6)(C)(iii); 40 CFR 22.45(c)(4)(ii)).
The CWA requires that if the evidence presented by the petitioner
in support of the petition is material and was not considered in the
issuance of the order, the Administrator shall immediately set aside
such order and provide a hearing in accordance with section
311(b)(6)(B)(ii) (33 U.S.C. 1321(b)(6)(C)(iii)). Conversely, if the
Administrator denies a hearing, the Administrator shall provide to the
petitioner, and publish in the Federal Register, notice of and reasons
for such denial. Id.
Pursuant to section 311 of the CWA, the authority to decide
petitions by commenters to set aside final orders entered without a
hearing and provide copies and/or notice of the decision has been
delegated to Regional Administrators in administrative penalty actions
brought by regional offices of EPA. Administrator's Delegation of
Authority 2-52A (accessible at: http://intranet.epa.gov/ohr/rmpolicy/ads/dm/2-52A.pdf). The Rules of Practice require that where a commenter
petitions to set aside a consent agreement and final order in an
administrative penalty action brought by a regional office of EPA, the
Regional Administrator shall assign a Petition Officer to consider and
rule on the petition (40 CFR 22.45(c)(4)(iii)). Upon review of the
petition and any response filed by the complainant, the Petition
Officer shall then make written findings as to (A) the extent to which
the petition states an issue relevant and material to the issuance of
the consent agreement and proposed final order; (B) whether the
complainant adequately considered and responded to the petition; and
(C) whether resolution of the proceeding by the parties is appropriate
without a hearing (40 CFR 22.45(c)(4)(v)).
If the Petition Officer finds that a hearing is appropriate, the
Presiding Officer shall order that the consent agreement and proposed
final order be set aside and establish a schedule for a hearing (40 CFR
22.45(c)(4)(vi)). Conversely, if the Petition Officer finds that
resolution of the proceeding without a hearing is appropriate, the
Petition Officer shall issue an order denying the petition and stating
reasons for the denial (40 CFR 22.45(c)(4)(vii)). The Petition Officer
shall then file the order with the Regional Hearing Clerk, serve copies
of the on the parties and the commenter, and provide public notice of
the order. Id.
II. Procedural Background
In May of 2016, the Director of the Superfund Division of EPA's
Region 5 (Complainant) and BP Products North America Inc. (Respondent)
executed a Consent Agreement and Final Order (CAFO) in the matter
styled as In the Matter of BP Products North America Inc., Docket No.
CWA-05-2016-0015.\1\ The CAFO sought to simultaneously commence and
conclude an administrative penalty action under section
311(b)(6)(A)(ii) of the CWA against Respondent for alleged violations
related to a discharge of oil from Respondent's petroleum refinery
located at 2815 Indianapolis Boulevard in Whiting, Indiana (Facility),
into Lake Michigan on March 24, 2014. Under the terms of the CAFO,
Respondent admitted the jurisdictional allegations set forth in the
CAFO but neither admitted nor denied the factual allegations and
alleged violations. Nevertheless, Respondent waived its right to a
hearing or to otherwise contest the CAFO, and agreed to pay a civil
penalty in the amount of $151,899.
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\1\ While titled ``Consent Agreement and Final Order,'' a final
order was not actually included with the CAFO filed with this
Tribunal. It is the execution of a final order by Region 5's
Regional Administrator, and its subsequent filing with the Regional
Hearing Clerk at Region 5, that will effectuate the parties' Consent
Agreement and conclude the proceeding.
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On or about June 1, 2016, EPA provided public notice of its intent
to file the proposed CAFO and accept public comments thereon. Carlotta
Blake-King, Carolyn A. Marsh, Debra Michaud, and Patricia Walter
(Petitioners) timely filed comments on the proposed CAFO (Comments).
Complainant subsequently prepared a Response to Comments Regarding
Proposed CAFO (Response to Comments), which indicated that EPA would
not be altering the proposed CAFO. The Response to Comments was mailed
to Petitioners, together with a copy of the proposed CAFO, on or about
January 17, 2017, and each Petitioner received the materials by January
30, 2017. On or about February 24, 2017, Petitioners timely filed a
joint petition seeking to set aside the proposed CAFO and have a public
hearing held thereon (Petition).
A Request to Assign Petition Officer (Request) was issued by Region
5's Acting Regional Administrator on May 17, 2017, and served on
Petitioners on May 30, 2017. In the Request, the Acting Regional
Administrator stated that after considering the issues raised in the
Petition, Complainant had decided not to withdraw the CAFO.
Accordingly, the Acting Regional Administrator requested assignment of
an Administrative Law Judge to consider and rule on the Petition
pursuant to Sec. 22.45(c)(4)(iii) of the Rules of Practice, 40 CFR
22.45(c)(4)(iii). By Order dated June 16, 2017, the undersigned was
designated to preside over this matter, and Complainant was directed to
file a response to the Petition. Complainant filed its Response to
Petition to Set Aside Consent Agreement and Proposed Final Order
(Response to Petition) on July 13, 2017.\2\
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\2\ Richard C. Karl, who executed the CAFO as Region 5's
Director of the Superfund Division, seemingly left that position by
the time the Acting Regional Administrator issued the Request to
Assign Petition Officer. In the Request, the Acting Regional
Administrator noted that Complainant, the Acting Superfund Division
Director, had decided not to withdraw the CAFO. Subsequently,
Margaret M. Guerriero, as the Acting Director of Region 5's
Superfund Division, submitted the Response to Petition.
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III. Denial of Petitioners' Petition
On May 8, 2018, the undersigned issued an Order Denying Petition to
Set Aside Consent Agreement and Proposed Final Order (Order). Therein,
the undersigned denied the Petition without the need for a hearing on
the basis that Petitioners had failed to present any relevant and
material evidence that had not been adequately considered and responded
to by Complainant.
Specifically, Petitioners raised issues that the undersigned
grouped into four categories.\3\ First, Petitioners argued that the
alleged violations warranted the assessment of the maximum penalty of
$187,500 allowed under the applicable law, suggesting that Complainant
failed
[[Page 22976]]
in its penalty calculation to consider material evidence regarding the
magnitude of the violations to the local community. Petitioners cited,
among other considerations, that Lake Michigan is a source of drinking
water for residents of the City of Chicago and surrounding region and
that the March 24, 2014 discharge of oil from the Facility into Lake
Michigan occurred only a few miles from the structures operating in
Lake Michigan to collect that drinking water. Petitioners further
argued that the violations were part of a broader environmental crisis
perpetuated by Respondent. The undersigned determined that while
Complainant did not provide a detailed explanation of how the civil
penalty assessed in the proposed CAFO had been calculated, and in
particular an account of how the environmental impact of the alleged
violations on the community, if any, was considered, it had considered
and responded to Petitioners' arguments in its Response to Comments and
Response to Petition. The undersigned further found that Petitioners
had produced no evidence to support their position or rebut
Complainant's position that it had properly implemented the applicable
policy governing its calculation and negotiation of the penalty
assessed in the proposed CAFO. The undersigned concluded that
Petitioners had not met the burden of demonstrating that the matters
they raised with respect to the assessment of a higher penalty
constituted material and relevant evidence that Complainant failed to
consider in agreeing to the proposed CAFO. Thus, Petitioners' claim in
this regard was denied.
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\3\ Petitioners described the arguments set forth in the
Petition as additions to the Comments they had previously submitted
to EPA in response to the public notice of EPA's intent to file the
proposed CAFO. Accordingly, the undersigned considered the arguments
raised by Petitioners in both the Petition and the Comments.
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Second, Petitioners urged that an additional fine of $100,000 be
levied against Respondent for its purported culture of indifference
towards health and safety, which, according to Petitioners, was evident
from the violations Respondent has committed and the ineffective
responses it has undertaken over many years. In considering this issue,
the undersigned first noted that EPA is limited to imposing the maximum
penalty permitted under applicable law for the violations alleged and
determining the penalty based on the statutory factors and that
Petitioners failed to cite any legal authority allowing EPA to impose a
fine beyond the maximum statutory penalty. The undersigned then noted
that Petitioners also failed to offer any argument or evidence
rebutting Complainant's position that it had properly implemented the
applicable policy governing its calculation and negotiation of the
penalty assessed in the proposed CAFO, which takes the statutory
penalty factors into account. Accordingly, the undersigned found that
with respect to this issue, Petitioners did not present any fact or
argument relevant and material to the proposed CAFO that was not
already considered by Complainant. Thus, the claim was denied.
Third, Petitioners urged that a Supplemental Environmental Project
(SEP) be incorporated into the proposed CAFO for local projects and
that local residents be included in the projects. In association with
those requests, Petitioners questioned the manner in which funds for
SEPs were distributed by EPA and the Department of Justice and asserted
that residents had not been included in projects occurring in the Lake
George Branch of the Indiana Harbor Ship Canal. The undersigned found
that as Complainant had stated in its Response to Comments and Response
to Petition, EPA lacks the legal authority to demand a SEP or control
the distribution of civil penalty funds. The undersigned concluded that
given this lack of authority, the issues raised by Petitioners with
regard to a SEP were immaterial to the issuance of the proposed CAFO.
Thus, this claim was denied.
Fourth, Petitioners urged that an independent advisory committee
and environmental monitoring program for Respondent's wastewater
treatment plant be created. Petitioners then questioned Respondent's
community outreach activities, which Complainant had referenced in its
Response to Comments. The undersigned found that as argued by
Complainant in its Response to Petition, EPA lacks the legal authority
under section 311(b)(6) of the CWA to establish advisory committees or
environmental monitoring programs or compel Respondent to engage in
outreach activities. The undersigned concluded that given the absence
of any material and relevant issue not considered by Complainant with
respect to the course of action requested by Petitioners, their claim
in this regard was also denied.
Having found that Petitioners failed to present any relevant and
material evidence that had not been adequately considered and responded
to by Complainant in agreeing to the proposed CAFO, the undersigned
then addressed Petitioners' requests for a public hearing in their
Comments and Petition. Noting that Petitioners appeared to seek a
public forum, at least in part, for the parties to explain the meaning
of the proposed CAFO to the public, the undersigned observed that
section 311(b)(6)(B)(ii) of the CWA and the Rules of Practice provide,
not for a meeting of that nature, but rather a hearing at which
evidence is presented for the purpose of determining whether
Complainant met its burden of proving that Respondent committed the
violations as alleged and that the proposed penalty is appropriate
based on applicable law and policy. The undersigned noted that
Petitioners did not specifically identify any testimonial or
documentary evidence that they would present at any such hearing. The
undersigned further noted that Petitioners did not offer in either
their Comments or the Petition any relevant and material evidence or
arguments that had not already been adequately addressed by
Complainant. For these reasons, the undersigned found that resolution
of the proceeding by the parties would be appropriate without a
hearing.
The undersigned thus issued the Order Denying Petition to Set Aside
Consent Agreement and Proposed Final Order.
Dated: May 8, 2018.
Susan L. Biro,
Chief Administrative Law Judge.
[FR Doc. 2018-10568 Filed 5-16-18; 8:45 am]
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