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Civil penalties for polluters dropped dramatically in Trump’s first two years, analysis shows

The decline in civil penalties could undermine EPA’s ability to deter wrongdoing, some former agency officials said. (Bill O'Leary/The Washington Post)

Civil penalties for polluters under the Trump administration plummeted during the past fiscal year to the lowest average level since 1994, according to a new analysis of Environmental Protection Agency data.

In the two decades before President Trump took office, EPA civil fines averaged more than $500 million a year, when adjusted for inflation. Last year’s total was 85 percent below that amount — $72 million, according to the agency’s Enforcement and Compliance History Online database.

Cynthia Giles, who headed the EPA’s enforcement office in the Obama administration and conducted the analysis, said the inflation-adjusted figures were the lowest since the agency’s Office of Enforcement and Compliance Assurance was established.

The decline in civil penalties could undermine the EPA’s ability to deter wrongdoing, some former agency officials said, because they help ensure it is more expensive to violate the law than to comply with it. But Trump administration officials have said they are focusing much of their effort on working with companies ahead of time so they don’t run afoul of the law, rather than punishing them after the fact. That approach, they say, will ensure business operations can thrive without harming the environment.

Giles, now a guest fellow at the Harvard Environmental and Energy Law Program, questioned whether the new approach can achieve what administration officials promise.

“The public expects EPA to protect them from the worst polluters,” she said. “The Trump EPA is not doing that. What worries me is how industry will respond to EPA’s abandonment of tough enforcement.

During his confirmation hearing last week, EPA acting administrator Andrew Wheeler told lawmakers that there had been “a lot of misleading information” suggesting that the agency had gone easier on polluters under Trump. He cited recent reports from environmental and governance groups that said the EPA’s enforcement had sagged.

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Wheeler pointed to the fact that the EPA had opened more criminal enforcement cases during 2018 than the year before, reversing a downward trajectory. He said enforcement actions last year resulted in removing “809 million pounds of pollution and waste” from the environment. And hesaid the agency had worked with companies it oversees to ensure they comply with federal rules, rather than levying charges against them or imposing fines.

“And I think the more compliance assurance that we have, the fewer enforcement actions we need to take,” he said.

But the analysis conducted by Giles and reviewed by the Environmental Integrity Project shows that in addition to the drop in civil penalties for polluting, the amount of money companies must pay to come into compliance with federal environmental laws also declined last fiscal year, to nearly $5.6 billion. That represents the lowest amount of injunctive relief since 2003, in inflation-adjusted dollars, and is below the roughly $7.8 billion average for the two decades before Trump took office.

EPA officials declined to disclose the exact figures for past fiscal year’s civil or criminal penalties, saying they could do so only after the partial government shutdown is over.

In a statement Thursday, the EPA’s top enforcement official, Susan Bodine, called the analysis misleading because it included large settlements such as a single year when the BP oil spill raised the civil penalties by $5.7 billion.

“It is not statistically valid to imply a trend by averaging an outlier value with other values,” she said, noting that excluding the unprecedented BP penalty brought the agency’s average to $160 million a year.

Even when using that methodology, however, the Trump administration’s total last year represented a roughly 55 percent drop from the annual average.

Bodine emphasized that while enforcement penalties vary from year to year, the agency will continue targeting bad actors.

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“Let there be no mistake — EPA enforcement will continue to correct noncompliance using all the tools at its disposal, including imposing civil penalties to maintain a level playing field and deter future misconduct,” she said.

Civil penalties, which the EPA applies for a range of violations, including water contamination and air pollution, aim to recover the financial benefit a company has reaped by breaking the law and to impose additional costs so that firms are deterred from doing it in the future.

While the EPA often imposes civil penalties in cases that also involve criminal conduct — such as in the case of Volkswagen’s emissions cheating scandal — the agency typically pursues criminal penalties when a firm knowingly and intentionally violates the law or engages in gross negligence.Duke Energy’s decision not to repair corroded pipes that lay under a coal ash pond that collapsed in North Carolina in 2014, for example, constituted a criminal case.

The agency’s numbers will undoubtedly rise in 2019 because the federal government recently reached a major settlement with Fiat Chrysler Automobiles over emissions cheating.

That agreement includes a civil penalty of $305 million — a figure the EPA noted is four times more than all civil penalties it collected last fiscal year. EPA said that while its overall number of cases declined last fiscal year, “EPA is continuing to direct its resources to the most significant and impactful cases.”

The recent settlement with Fiat Chrysler began with a notice of violation that the EPA sent the company on Jan. 12, 2017, just before Barack Obama left the presidency.

Eric Schaeffer, executive director of the advocacy group Environmental Integrity Project, said the EPA’s enforcement record during Trump’s first full fiscal year offers a fuller picture of the administration’s approach to enforcement, because fewer cases would have been inherited from the previous administration.

“By that time, you should have momentum and you should be making your mark on the program,” said Schaeffer, who headed the EPA’s Office of Civil Enforcement from 1997 to 2002, adding that he found the analysis accurate.

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That said, there are signs that the EPA has continued to pursue a number of cases the agency began before Obama left office.

In late December 2016, the agency gave a notice of violation to a scrap metal processing facility in Rockford, Ill., that was releasing an unlawful amount of lead into the air. Bob Ellis, senior vice president and general counsel for Alter Trading Corp., which bought the facility a few months before the EPA took action, said in an interview that it has spent the past couple of years working with the agency to resolve the issue. He said the two sides had reached an agreement, but he declined to disclose the terms because it was not yet public. “It was prosecuted fairly and settled fairly,” Ellis said.

Along with the Justice Department, the agency also has overseen completion of certain criminal cases from the Obama era. They include minor ones such as an auto repair shop owner illegally dumping chemicals down a drain and more significant ones, such as a company agreeing to a nearly $2 million fine for importing construction equipment with engines that did not comply with U.S. air emissions standards.

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However a decline in the number of criminal investigators, which began during the Obama administration, has taken a toll. As of October, a Washington Post analysis showed, the EPA’s enforcement division was among the most affected by a broader exodus at the agency fueled by buyouts and retirements. It has lost at least 80 people since Trump entered office.

EPA spokesman John Konkus said in an email that the enforcement division has been authorized to fill some of those vacancies and hire as many as 164 criminal special agents. “OECA began recruiting agents last summer and is in the process of bringing additional agents onboard,” Konkus said, adding that the current number of agents is 147.

Under the 1990 Pollution Prosecution Act, the division is supposed to have no fewer than 200 criminal investigators. In December 2010, there were 272 at the agency, according to an analysis of Office of Personnel Management data, but that number declined during the Obama administration.

Wheeler suggested during his Senate testimony that the fact that Bodine was not confirmed until Dec. 7, 2017, had a meaningful impact on its enforcement activities.

“What our enforcement program needed in the Trump administration was a head of the office,” Wheeler said.

Bodine herself has emphasized the need to take a different approach when it comes to cracking down on polluters. On Aug. 21, 2018, she issued a memo outlining her thinking, in which she informed employees, “The EPA intends to evolve the National Enforcement Initiatives program into a National Compliance Initiatives,” italicizing key words for emphasis.

Daren Bakst, a senior research fellow at the conservative Heritage Foundation, praised the administration’s approach.

“It is better to prevent environmental violations from occurring in the first place than to act after the fact when environmental violations have already occurred. This is why improving compliance is so important,” Bakst said.

Andrew Ba Tran contributed to this report.