GAO critical of the measures used by EPA to allege success of enforcement programs

GAO critical of the measures used by EPA to allege success of enforcement programs

The Government Accountability Office has issued a letter report that is highly critical of the measures used by EPA to allege the success of its various civil and criminal enforcement activities, which are often done in conjunction with the U.S. Department of Justice. The issues were framed by GAO as follows: "EPA relies on a variety of measures to assess and report on the effectiveness of its civil and criminal enforcement programs. For example, EPA relies on assessed penalties that result from enforcement efforts among its long-standing measurable accomplishments… Like other federal agencies, EPA has established results-oriented goals and performance measures. Two of the major performance measures for civil enforcement, according to EPA, are (1) the value of injunctive relief — the monetary value of future investments necessary for an alleged violator to come into compliance, and (2) pollution reduction –– the pounds of pollution to be reduced, treated, or eliminated as a result of an enforcement action. EPA told us these two measures, as well as penalties, should be considered when assessing the overall impact of its enforcement actions… Unless these measures are meaningful, Congress and the public will not be able to determine the effectiveness of the programs. Therefore, it is important to understand how they are determined and the extent to which they accurately reflect EPA’s accomplishments." GAO then goes on to critically assess how meaningful are the measures employed: "Total penalties assessed by EPA, when adjusted for inflation, declined from $240.6 million to $137.7 million between fiscal years 1998 and 2007. We identified three shortcomings in how EPA calculates and reports penalty information to Congress and the public. Specifically, EPA is:

 

 

• Overstating the impact of the enforcement programs by reporting penalties assessed against violators rather than actual penalties received by the U.S. Treasury.

 

 

• Reducing the precision of trend analyses by reporting nominal rather than inflation-adjusted penalties, thereby understating past accomplishments.

 

 

• Understating the influence of its enforcement programs by excluding the portion of penalties awarded to states in federal cases.

 

 

In contrast to penalties, we found that both the value of estimated injunctive relief and the amount of pollution reduction reported by EPA generally increased. The estimated value of injunctive relief increased from $4.4 billion in fiscal year 1999 to $10.9 billion in fiscal year 2007, in 2008 dollars. In addition, estimated pollution reduction commitments amounted to 714 million pounds in fiscal year 2000 and increased to 890 million pounds in fiscal year 2007. However, we identified several shortcomings in how EPA calculates and reports this information. We found that generally EPA’s reports do not clearly disclose the following:

 

 

• Annual amounts of injunctive relief and pollution reduction have not yet been achieved. They are based on estimates of relief and reductions to be realized when violators come into compliance.

 

 

• Estimates of the value of injunctive relief are based on case-by-case analyses by EPA’s technical experts, and in some cases the estimates include information provided by the alleged violator.

 

 

• Pollution reduction estimates are understated because the agency calculates pollution reduction for only 1 year at the anticipated time of full compliance, though reductions may occur for many years into the future. Finally, we identified factors that affect EPA’s process in achieving penalties, injunctive relief, and pollution reduction. For example, DOJ, not EPA, is primarily responsible for prosecuting and settling civil judicial and criminal enforcement cases. Therefore, EPA does not have ultimate control of enforcement outcomes." GAO then recommends that EPA improve the transparency and accuracy of its data. By transparency, GAO means that EPA accurately portray how the various measures are created and the data derived; for example, the penalties cited should note whether they are a statement of amounts assessed or a statement of amounts collected. Accuracy would be improved, in the view of GAO, by adjusting figures for inflation, and by noting how much of a penalty is actually a State's share, not a portion of the amount either assessed or collected by the Federal government. Additionally, the monetary value of injunctive relief should make plain that it is an estimate based on future activities that may, or may not, occur, and similarly that pounds of pollutants reduced should make plain that they are estimates of anticipated future activities that may, or may not, occur. The report was requested by Representatives John D. Dingell and Bart Stupak, both Democrats from Michigan . Representative Dingell in particular was highly critical of EPA as a result of the findings, claiming that it showed that enforcement activity had actually declined in the last nearly eight years and that EPA was distorting data to hide this "fact." Since it is unclear if prior reports under other Administrations had used similar measures, it is difficult to assess the accuracy of this conclusion. Be that as it may, GAO has correctly pointed out that the reporting methodology does not lend itself to a truly meaningful assessment of performance. The full report can be found at http://www.gao.gov/new.items/d081111r.pdf.

 

Comments

Thomas H. Clarke, Jr.
  • 07-07-2009

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