Other Bulletins

March 2002
Environment Law Newsletter

Audits of Disposal Sites in the Massachusetts DEP Western Region

Amendments in 1992 to Chapter 21E of the Massachusetts General Laws (the state analogue to federal Superfund) established the current privatized system whereby Licensed Site Professionals ("LSPs") supervise the investigation and remediation of most sites where releases of oil or hazardous materials have occurred. The same amendments require that the Massachusetts Department of Environmental Protection ("DEP") audit 20 percent of the sites each year.

Each month DEP publishes a compilation of "Notices of Audit Findings" ("NOAFs") sent to persons conducting response actions at sites that have been audited by its Bureau of Waste Site Cleanup. DEP includes a brief summary table with the NOAFs listing identification information, including the Release Tracking Number ("RTN"). The most recent compilation, made available to us in January 2002, includes the NOAFs issued through the month of December 2001.

Ever since DEP began to issue NOAFs in 1994, our firm has purchased copies of all the individual NOAFs applicable to sites overseen by the DEP Western Regional Office ("WERO"), along with the statewide summary tables, as they have been released by DEP. This article summarizes data that we have compiled from our review of NOAFs since 1998.

The table below summarizes audit statistics for the Western Region. The first data column lists the average number of violations cited by DEP per NOAF letter. The number of violations represents both those violations that require further action and those that do not require further action (because they were corrected during the course of the audits or because they cannot be corrected, as where deadlines were already missed).

Note that the number of violations per NOAF letter has steadily increased from 1.8 violations in calendar year 1998 to 5.1 violations during calendar year 2001.

Note too that the percentage of NOAF letters that also contained Notices of Noncompliance ("NONs") has more than doubled from 28 percent in 1998 to 63 percent in 2001. At the same time, the percentage of NOAF letters that did not cite any violations declined from 30 percent to under 8 percent.

WERO consistently issues a higher percentage of NOAFs than does any of the other DEP Regions. In calendar year 2000, WERO performed comprehensive audits of approximately 16 percent of the sites in the Region, compared to roughly 3 to 7 percent in the other three DEP Regions. WERO performed comprehensive audits of about 16 percent of its sites during calendar year 2001, while the other DEP Regions were on track to audit comprehensively 3 to 9 percent of their sites. Though the trend is improving, DEP has never managed to perform comprehensive audits of 20 percent of its sites in one year.

DEP has acknowledged that it was not meeting the 20 percent statutory mandate for audits prior to 1999. However, that year DEP initiated "screening audits" to supplement its comprehensive audits. Beginning with fiscal year 2000 (July 1, 1999 through June 30, 2000), DEP began to count screening audits and audit inspections, in addition to comprehensive audits, when determining the percentage of sites that it audited. On this revised basis, DEP reports that it audited 36 percent of its sites in fiscal year 2000 and 22 percent in fiscal year 2001. WERO alone performed 860 screening audits from program inception through the end of the calendar year 2001.

There are major differences between comprehensive audits and screening audits. One of the more significant differences is that the person conducting the site cleanup may never know that a screening audit has occurred. In the case of a comprehensive audit, DEP first sends a Notice of Audit describing the scope of the audit and the type of audit activities to be performed. Upon completion of a comprehensive audit, DEP issues a NOAF identifying any violations or deficiencies found. However, DEP is not required to send a Notice of Audit for screening audits limited to a review of documents in DEP's files or other public records. Similarly, DEP is not required to issue a NOAF upon completion of a screening audit. Thus, the person conducting response actions may never know that DEP has performed a screening audit, unless DEP finds sufficient violations to take further action.

During screening audits, DEP auditors typically use checklist forms indicating whether various regulatory requirements have been met. It would be very helpful to a person who has submitted to DEP a Response Action Outcome ("RAO") Statement indicating that response actions at the site have been completed, and who now wants to sell the property, to be able to show potential buyers a favorable checklist, which DEP calls its RAO Technical Screening Audit Form. In theory, the completed forms are public records, but owners are unlikely to request copies of documents they do not even know exist. Thus, potential opportunities to return property to productive use following cleanups may be missed because of potential buyers' concerns that DEP might audit the site and find violations.

In conclusion, DEP WERO performs comprehensive audits on a higher percentage of sites than any other Region, and the numbers of violations found and Notices of Noncompliance issued have been increasing over time. Given the hundreds of pages of regulations, and thousands of pages of relevant DEP policy and guidance documents, achieving compliance is a daunting task. The best way to avoid problems upon audit is to be very careful at each step during the site investigation and remediation process that all of the response actions performed, and all of the reports submitted to DEP, comply fully with the legal requirements.

We have regularly helped clients select and work with LSPs to clean up sites effectively and efficiently. If you would like a copy of a NOAF for a particular site in Western Massachusetts, please call our Environmental Paralegal, Joe Dayall (413-272-6282), or call attorneys Chris Myhrum (413-272-6281) or Jim Duda (413-272-6284) with any questions.