For several years, EPA has encouraged the regulated community to audit their facilities for compliance with environmental laws, and to self-disclose to EPA any violations noted in the audit to obtain reductions to or even eliminate altogether civil penalties if the report is made on a timely basis and demonstrates that the violations are being corrected promptly. These policies were announced in April 2000 with a special policy made available to small businesses (the Small Business Compliance Policy). In 2008, the benefits of the policy were extended to new owners to encourage them to undertake an environmental audit of the facilities they were purchasing to address and correct existing environmental violations and to take advantage of the opportunity provided by the Audit Policy to embark upon a “fresh start” with EPA. The result of these polices was to dramatically expand the scope of environmental auditing, which, EPA has concluded, resulted in significant overall reductions in pollution. However, EPA has received so many reports that it has taxed the agency’s ability to resolve promptly all pending disclosures to determine whether the disclosure qualifies for the benefits of these policies. Accordingly, EPA has established a web-based eDisclosure Portal to receive and automatically process self-disclosed civil violations of environmental law on a streamlined basis. The eDisclosure Portal Launch, 80 F.R. 76476 (December 9, 2015), and its attendant policies was effective on December 9, 2015. To date, EPA’s policy has been not to release under the Freedom of Infirmation Act (FOIA) any unresolved disclosures of uncovered environmental violations. Everyone should take note that the presumption against nondisclosure has been reversed.
The automated disclosures may qualify for processing as either a “Category 1” or “Category 2” treatment. Category 1 treatment will be limited to EPCRA reporting violations that meet all Audit Policy conditions except for CERCLA Section 103 releases and EPCRA Section 304 chemical releases. Those disclosures submitted electronically to EPA that qualify for Category 1 treatment will receive an automatic notice from EPA that there will be no civil penalties assessed as a result of the submission. Those disclosures that qualify for Category 2 treatment—generally all non-EPCRA violations—will automatically receive an Acknowledgement Letter from EPA that the agency will make a determination that the disclosure will not result in a civil penalty if and when EPA considers whether to take an environmental enforcement action.
The eDisclosure Process is triggered when the person submitting the information has properly registered with EPA, submits the notice of uncovered violations on a timely basis, and has taken steps to correct the violations. Otherwise, EPA’s Audit Policy has not changed, with the exception of the application of the Freedom of Information Act (FOIA) to “unresolved” disclosures.
While this new eDisclosure Portal will have some obvious benefits, such as potentially avoiding civil penalties, it should not be ignored that there is one substantial shift in presumption that accompanies it as regards to disclosure of Infirmation pursuant to FOIA. Whereas before EPA’s policy has been not to release under the FOIA any unresolved disclosures of uncovered environmental violations, this presumption against nondisclosure has been reversed. This should be a factor considered when deciding to self-report or not to self-report.