Panel Paper: Leveraging Enforcement to Enhance Community: The Use of Supplemental Environmental Projects to Promote Environmental Justice

Thursday, November 8, 2012 : 4:00 PM
Adams (Sheraton Baltimore City Center Hotel)

*Names in bold indicate Presenter

Deborah Gallagher, Duke University and Dika Kuoh, Georgia Environmental Protection Division

When businesses, individuals, institutions or organizations fail to comply with environmental laws and regulations they may face enforcement action from state, local or federal environmental protection agencies.  In most enforcement cases, the alleged violator is asked sign a settlement agreement that establishes a deadline for resolving the alleged violation(s) and sets stipulated monetary penalties.  Although monetary penalties play an important role in deterring violations and promoting a level playing field within the industry in which the alleged violator operates, the penalties are typically sent to a general fund at the state level or to the US Treasury at the federal level with little or no benefit to the communities impacted by the violations.

In 1991, supplemental environmental projects (SEPs) defined as, “environmentally beneficial projects that an environmental violator voluntarily agrees to undertake in settlement of a civil penalty action”, were introduced by the United States Environmental Protection Agency’s Office of Enforcement and Compliance Assurance to allow alleged violators of environmental laws to offset or mitigate a portion of their monetary penalties by engaging in activities designed to benefit the health and well-being of their local community.  SEPs are meant not only to enhance environmental protection goals beyond compliance, but to provide a tool to support other critical environmental policy goals such as pollution prevention, environmental justice and brownfield redevelopment.

SEPs are implemented through policies adopted by state, local or federal agencies charged with undertaking the enforcement action.  At a time of growing environmental challenges and fiscal constraint in state and local government, SEPs can be leveraged with other investments and resources to fund projects in environmental justice (EJ) communities, which suffer disproportionately from the impacts of environmental pollution. Less than 12% of settlements involving penalties have employed SEPs (Kristl, 2007); a smaller subset of these primarily addresses EJ issues. Research suggests that effective SEP implementation requires significant resources devoted to stakeholder negotiation (Ganguly, 1998) and that this may pose a challenge to EJ communities which lack such capacity (Rosenthal & Lee, 2003).

This paper seeks to assess the effectiveness of SEPs in promoting EJ goals. It employs descriptive and quantitative data from the USEPA’s Enforcement and Compliance History Online (ECHO) database to catalogue EJ-focused SEPs enacted between FY2001 and FY 2011. The effectiveness of these SEPs is then assessed using both survey and interview methods. First, stakeholders, alleged violators, community leaders and regulatory agency staff, involved in the implementation of EJ-focused SEPs during this time period are surveyed. Second, a subset of these stakeholders is interviewed to obtain a more granular perspective on implementation issues. Stakeholders provide unique perspectives on challenges faced and benefits attained from working on SEPs. Recommendations for enhancing capacity of disadvantaged communities to participate in SEP projects and improving the effectiveness of SEPs as a public policy tool to address environmental justice issues are offered.