Fearing that the controversy surrounding the Environmental Protection Agency has grown "out of control," the White House has offered to reverse itself and show a House subcommittee confidential EPA documents that President Reagan previously had ordered withheld under a claim of executive privilege.
At the same time, an EPA official acted yesterday to stop destruction of documents in the agency's hazardous waste program office. A congressional committee is to hold hearings today on whether EPA employes violated federal law in shredding copies of documents subpoenaed last year by its oversight subcommittee.
In addition to shredding documents, EPA employes said yesterday that they recently purged dozens of related memos, notes and other records from the memory bank of a computer in the agency's embattled hazardous waste program office, without keeping logs of what was destroyed.
Discovery of the purge prompted acting EPA Assistant Administrator Michael A. Brown to issue a memorandum yesterday forbidding "destruction, alteration or other disposition" of records, appointment calendars and telephone logs in the hazardous waste office "without my written authorization."
Brown was named by EPA Administrator Anne M. Gorsuch to replace Rita M. Lavelle, whose firing by Reagan last week escalated congressional scrutiny of the EPA's $1.6 billion program to clean up the nation's most dangerous hazardous waste dumps and to prosecute companies responsible for them.
Six House and Senate subcommittees have announced inquiries into charges that Lavelle and other officials arranged "sweetheart deals" with companies that should have been forced to clean up the dumps and that they distributed cleanup funds for political reasons rather than public health considerations.
Gorsuch and Lavelle have emphatically denied all accusations of wrongdoing.
The controversy has grown from the initial concern of House Democrats that the Reagan administration was trying to undo a decade of environmental protection policy, including the hazardous waste cleanup program. It escalated with evidence of what some House leaders have called a "cover-up," including the withholding of key EPA documents and the destruction of others.
The latest administration actions were described by several knowledgeable officials as a sign that the White House believes the dispute over the EPA documents, which prompted the historic House vote to hold Gorsuch in contempt of Congress, has become a serious political problem.
Reagan had ordered Gorsuch to withhold dozens of documents based on advice from the Justice Department that releasing them could jeopardize enforcement actions against companies responsible for dangerous abandoned dumps. The proposal presented to House leaders over the weekend would allow them to view these records, but would control access to protect confidentiality, several sources said.
Under previous compromise proposals, which were rejected by the House, the administration proposed simply to describe certain highly "sensitive" documents without turning them over.
"There is a general feeling that this whole thing [the contempt case] has gotten out of control," said a senior administration official who asked to remain anonymous. "It has gone in a lot of directions no one ever would have predicted. Everyone still believes in the principle of executive privilege, but the principle sometimes suffers when you get into a situation like this."
House leaders have said they must see all documents on the hazardous waste program to allay their concerns about mismanagement and questions of conflict of interest and political favoritism. Rep. Elliott H. Levitas (D-Ga.), chairman of the House Public Works and Transportation subcommittee on oversight that sponsored the contempt citation, said he plans to meet with administration officials later this week to discuss the compromise proposal further.
House leaders declined to divulge details of the proposal, and said they do not yet know whether it will lead them to drop the contempt citation.
Meanwhile, House Public Works and Transportation Committee Chairman James J. Howard (D-N.J.) repeated his call for an FBI probe into the shredding of copies of subpoenaed EPA documents, stressing that the subpoena covered all records on the most dangerous hazardous waste dumps "including duplicates."
Justice Department spokesmen declined to say whether an investigation would take place, but Howard's committee moved forward with an inquiry of its own, calling Gorsuch's chief of staff John Daniel and agency general counsel Robert M. Perry to testify today at a hearing on which documents were shredded.
Also yesterday, the EPA settled a long-running dispute with Hugh B. Kaufman, a whistle blower who had charged Lavelle with illegally harassing him for criticizing her and other agency officials. The settlement averted a lengthy public airing of Kaufman's charges.
Within the EPA yesterday, several officials complained that the growing congressional and public scrutiny of the agency in the last week has made it virtually impossible to conduct normal business. They cited Brown's memorandum forbidding the destruction of any papers as one of several "overreactions" to the appearance of wrongdoing created by congressional accusations.
Officials said they could not determine who issued the orders to purge the computer discs, but several of them said it was an innocent move intended to remove extraneous material from an overloaded memory system. They acknowledged that they had kept no log of materials that were purged, however.
"It's a normal bureaucratic problem, but it's worse here than elsewhere because we're all packrats," said Eugene Lucero, director of the hazardous waste program's enforcement section.
"Now everyone is talking about shreddergate and we're forced to overreact," Lucero said. "If somebody thinks something awful is going on in here, we'll just have to save everything. People are afraid to throw away a phone message now because somebody will say we destroyed subpoenaed materials. Somebody, someplace is going to have to give us a break. You either have to trust us or not."
Meanwhile, the Justice Department has tightened controls over which EPA documents will be released to congressional investigators. In a letter dated Feb. 3, one day before Gorsuch asked Lavelle to resign, Assistant Attorney General Carol E. Dinkins wrote EPA's Perry that Justice must screen all EPA documents before they are delivered to Congress.
Earlier in the dispute with the House the EPA had been allowed to release "non-sensitive" documents on the hazardous waste program without Justice or White House clearance