RCRA Air Compliance Initiative and Rescission of “Once In, Always In” Policy Present Federal and State Self-Audit Opportunities

Key Takeaways

• What Happened: EPA urges self-audits for facilities subject to RCRA Parts 264/265 Subparts AA, BB and CC air emission standards to avoid potential for substantial penalties and injunctive relief

• Who’s Impacted: Regulated entities with facilities subject to RCRA air standards, especially those newly subject to those standards after EPA’s just-finalized withdrawal of the “once in, always in” policy for HAP major sources under the Clean Air Act

• What Impacted Entities Should Consider Doing in Response:
  • Review relevant Compliance Initiatives
  • Identify facilities subject to RCRA air standards
  • Consider conducting a voluntary federal, state, or confidential compliance audit

The U.S. EPA Office of Enforcement and Compliance National Compliance Initiative focusing on reducing hazardous waste air emissions is alive and well.  EPA’s core goal is to foster compliance with the RCRA air rules in 40 CFR Parts 264 and 265, Subparts AA, BB and CC. EPA’s June 2020 EPA Enforcement Alert describes numerous areas of RCRA noncompliance that EPA continues to find at hazardous waste large quantity generators (LQGs) and treatment, storage, and disposal facilities (TSDFs). In the Alert, EPA suggests specific proactive operational measures that operators can take to improve compliance and points to the benefits of self-disclosure utilizing state or EPA audit programs.

Now may be a particularly good time to self-audit RCRA air rules compliance given that EPA recently finalized rescission of the “once in, always in” policy under Clean Air Act (CAA) Section 112. Former hazardous air pollutant (HAP) major sources that recently became minor sources by taking an enforceable limit on HAP emissions may now be subject to RCRA air rules to which they were formerly exempt under the CAA and require coverage in the facility’s RCRA permit. EPA points out this potentially unrecognized transition in the Alert, encouraging facilities to work with permitting authorities to address any associated compliance gaps.

EPA also notes the potential for noncompliance at major sources unaffected by the “once in, always in” policy withdrawal given the complex interplay between the RCRA air rules and CAA rules in 40 CFR Parts 60, 61 and 63. The CAA and RCRA each contain provisions to avoid duplication of requirements; e.g., with RCRA providing exemptions based on owner/operator certification that equipment that would be subject to Subparts AA or CC will operate in accordance with applicable CAA requirements. 

With EPA now on the lookout for RCRA-CAA compliance gaps, voluntary self-auditing provides an EPA-encouraged avenue for identification and correction of noncompliance and potential mitigation of sizable penalties that might otherwise be imposed. The EPA Compliance Initiative points to enforcement cases where the penalties were in the hundreds of thousands of dollars and injunctive relief in the millions.

The EPA Audit Policy is not the only mechanism for undertaking a compliance audit. Many states have audit programs that are similar to EPA’s program. Entities with facilities in two or more states can conduct simultaneous or sequenced audits pursuant to the EPA or state programs with careful logistical coordination of the discovery, disclosure, and correction of violations. Audits can also be conducted confidentially under the attorney-client privilege outside the EPA and state audit policies, although opportunities for disclosure and utilization of audit policies may be foreclosed where a state audit policy requires prior notice of an audit, such as in Texas, or where the deadline for disclosure has passed. 

Now might also be an opportune time for companies to consider broader RCRA auditing, to include other aspects of RCRA compliance. For example, some EPA regions have an informal but highly active Generator Initiative that focuses on reporting, contingency plans, and emergency response training. Compliance with EPA’s Hazardous Waste Generator Improvements Rule (effective May 30, 2017) in states that have received or will soon receive delegation may also present audit opportunities, given the number and complexity of regulatory changes in that rule.