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Penalty Guidelines

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DEP Secretary Announces Strengthened Penalty Guidelines at Keynote Speech to Major Environmental Gathering

--Updates to guidelines will provide additional deterrent for egregious environmental law violators--

TALLAHASSEE – During his keynote address at the Florida Chamber’s 21st Annual Environmental Permitting Summer School, before more than 800 attendees, Florida Department of Environmental Protection (DEP) Secretary Michael W. Sole today announced significant changes to the agency penalty guidelines [PDF - 1.29 MB]. The new guidelines will result in stiffer penalties by taking a tougher stance on the most serious environmental violations statewide. In 2006, DEP enforcement cases with monetary penalties assessed numbered more than 1,300.

“The changes to DEP’s guidelines provide a stronger deterrent for the most egregious violations, ultimately reducing the number of significant infractions that occur,” said DEP Secretary Sole. “I want to change the idea that ‘penalties are a cost of doing business’ by emphasizing the agency’s tough stance against violators.”

DEP has maintained penalty guidelines since the mid-1980s that provide direction to staff on how to calculate penalties for enforcement cases. In 2001, the Florida Legislature passed the Environmental Litigation Reform Act (ELRA) to provide a clear, efficient process to address less significant violations, which amount to approximately 90 percent of DEP’s enforcement cases annually. ELRA has been successful by decreasing the average time it takes DEP to resolve litigation in the less significant cases – reducing the average length of time from two years to four months – and providing a more efficient basis for negotiating settlements in cases involving penalties of $10,000 or less.

“With this major step forward, DEP is emphasizing that compliance with environmental regulations is, bottom line, better for business. It’s not only better for the state, but for private industry as well,” said DEP Secretary Sole.

The deterrent value of penalties for significant violations has not kept pace with Florida’s economy and has therefore diminished over time. Updates to the penalty guidelines also address violations not covered under ELRA. The stiffer penalties would apply to approximately 10 percent of enforcement actions taken by the agency, affecting 50 to 75 percent of the total penalty amounts assessed by DEP for major violations. DEP will take a tougher stance by increasing penalties and providing clearer guidance on pursuing enforcement for significant infractions that:

  • Involve hazardous waste and/or hazardous substance violations;
  • Result in economic benefit to a company or individual;
  • Are intentional and/or habitual;
  • Cause significant harm to the environment; or
  • Continue over an extended period of time.

Additional information: Changes to the penalty guidelines

There are six major changes to the guidelines that will complement the penalties pursued under ELRA and provide a greater deterrent for the most significant violations:

  1. Hazardous waste violations

    The ‘penalty matrix’ currently used to calculate penalties for violations of the storage, treatment or disposal of hazardous waste range from $100 per day (minor violations) to $25,000 per day (major violations). The penalties for hazardous waste violations will be significantly increased to match the recent increases adopted by EPA, which range from $500 per day (minor violations) to $32,500 per day (major violations). Additional instructions will be added to the ‘penalty matrix’ to help identify circumstances in which the maximum amount allowed by law, $50,000 per day per violation, should be pursued.

    Based on an analysis of DEP enforcement actions between 2002 and 2005, hazardous waste violations account for approximately 18 percent of the total enforcement actions. The total assessed penalties during this same time period for hazardous waste violations was $4.75 million (17 percent) of the Department’s assessed penalties. The proposed increase in the penalty matrix is expected to result in an increase of the assessed value for significant violations (those in which penalties exceed $10,000) by approximately 30 percent.

  2. Hazardous substance violations

    A ‘penalty matrix’ for violations involving the release of hazardous substances (as defined in Florida law) is now part of DEP’s penalty guidelines. The matrix currently used to calculate penalties for violations involving hazardous substances includes a maximum penalty of $10,000 per day, which is the same amount used for violations that do not involve hazardous substances. With these changes, DEP will pursue penalties up to a maximum of $25,000 per day, the highest penalty allowed by law, for this type of violation. The proposed change would result in higher penalties for violations involving hazardous substances, consistent with the intent of Florida law.

  3. Multi-day violations

    Although the current guidelines allow for assessment of the full penalty matrix amount for each day violations occur, that option is rarely used. Most multi-day penalties are calculated by using the penalty matrix amount for the first day of the violation and a much smaller amount for each day the violation continues. The change will provide guidance so that in certain circumstances the full penalty matrix amount will be used for at least the first 30 days the violation continues.

    Multi-day penalties will be pursued in all cases in which:

    • Daily economic benefit is gained;
    • Daily adverse impacts to the environment are occurring; or
    • Prompt action to stop or mitigate the violations was not taken.
  4. Recovery of economic benefit obtained from violations

    Although the current guidelines allow DEP to calculate and factor in the economic benefit for any violation, that option is rarely used. This change will require DEP to include economic benefit in all penalty calculations when it can be practically determined, and to establish guidance to help in that determination.

    For example, if a developer conducted dredging and filling of a wetland without a permit so that a shopping center could open sooner than it would have had a permit been obtained, the cost savings generated by the early opening of the shopping center would be an economic benefit to the developer. Without factoring in the economic benefit, the penalty calculated for three days of illegal dredging and filling might be $2,000 per day for a total of $6,000. If the developer saved $24,000 by opening the shopping center early due to the dredging and filling without a permit, a penalty that factored in the economic benefit gained by the developer would be $6,000 for three days of illegal dredging and filling plus $24,000 for the economic benefit, for a total of $30,000.

  5. Deliberate or chronic violations

    The current guidelines provide a range of penalties in each matrix box. This change will provide additional guidance on when to calculate penalties based upon the top of the range in the matrix box (or the highest amount). Examples include violations that are deliberate or chronic, which should result in consistently higher penalties to deter these major infractions.

  6. Penalty matrices vs. ELRA penalty schedules

    This change will update the penalty guidelines to provide guidance on which penalty matrices or schedules should be used to calculate penalty amounts. With this change, the most appropriate penalty matrix, and not the ELRA penalty schedules, will be used for cases that involve penalties that exceed $10,000.

    The penalty amounts provided in the ELRA penalty schedules are typically lower than the penalty amounts provided in DEP’s penalty matrices. This proposed change would only affect cases in which the total calculated penalty using the ELRA penalty schedules exceeds $10,000. This proposed change would result in higher penalties being pursued for many violations.

Last updated: July 19, 2011

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