11

FY2009 and FY2010 Big Case Projections:

Randy Hill, Acting Director, Office of Civil EnforcementDavid A. Hindin, Deputy Director, Office of ComplianceSenior Enforcement Managers MeetingSan Francisco, CA December 10, 2008

Enforcement Sensitive

2

ICIS Big Case Projection Schedule Initial FY09 BCP Schedule

Nov. 26 - Kick-off the FY2009 Big Case Projection (BCP) email. Dec. 8 - First BCP data pull -- for this presentation. Jan. 2, 2009: Regions enter into ICIS best available Big Case

Projections for FYs 2009 and 2010 (as well as final order results data for all FY 2009 lodged and entered cases).

Mid January: OC will generate the BCP report for FY 2009 & FY 2010, including data for the new RCRA measure, to begin analysis for revised GPRA targets.

OC will periodically re-run the big case report, compile the results and distribute to OCE, OSRE, Regions and DOJ. How frequently should we do this?

2

3

ICIS Big Case Projection Process in FY2009 Three major changes for FY 2009 BCP project:

1. We would like projections for two fiscal years instead of one: FYs 2009 and 2010.

2. Starting process earlier in FY.3. Addition of one new BCP criteria: 1 M lbs or

more of hazardous waste treated, minimized or properly disposed of. The new RCRA Big Case Projection field will be available in

ICIS on Dec 15

3

4

ICIS Big Case Projection Criteria Revised Criteria for Big Case Projections for FY 2009

Big Cases are cases that 1) have at least a 50% chance of concluding in the designated Fiscal Years (FY2009 or FY2010), and 2) meet at least one of the following criteria:

Non–Superfund BCP Criteria (estimated amounts) 1) Injunctive relief and SEP combined value of at least $5 million; or 2) Pollutants reduced, treated, or eliminated, estimated amount at least 1 million pounds; or 3) Pounds of hazardous waste treated, minimized or properly disposed of at least 1 million

pounds; or 4) Civil penalty value of at least $1 million.

Superfund BCP Criteria (estimated amounts) 1) Cost recovery value of at least $5 million; or 2) PRP clean up commitment value of at least $5 million; or 3) Volume of contaminated soil or water/aquifer clean-up commitment of at least 1 million

cubic yards. Remember: a case needs to meet only one Big Case criterion listed above to be considered

a Big Case. Remember to include administrative, CERCLA and federal facility cases.

4

5

Need Projections for 2 years and earlier in FY

Program needs for 1) earlier reporting of Big Case Projections and 2) providing data for FYs 2009 and 2010: As in prior years, we will use the BCP data:

to help manage our enforcement case pipeline to assess our progress in achieving our national annual

accomplishments for FY2009 (GPRA targets) OECA needs 2010 data, and earlier retrieval of the BCP

data, to enable us to develop new targets for EPA’s new strategic plan.

We also need to start collecting this information now in preparation for briefing a new OECA AA.

Finally, we want to improve our management of our big case pipeline by looking ahead two years, and not just one year.

6

Generating the Rough Preliminary Big Case Projections in this presentation For producing this report, we pulled FY 2009 BCP

data from ICIS on Dec. 8 We also obtained FY 2009 BCP information from OCE We combined the data to produce this report.

We used the BCP data pulled from ICIS, and supplemented that with data from OCE whenever: The data for a case identified by OCE had not been

input to ICIS; or The data in ICIS for a case was not as complete as that

provided by OCE.

7

Caution: Rough Preliminary Projections The projections shown today are preliminary

and rough. There has not been sufficient time to identify big

cases, develop quantitative estimates for the criteria, and enter into ICIS.

OCE’s list was not comprehensive, but a quick survey of the OCE divisions.

OSRE and Superfund program may not have participated yet.

88

Estimated Pollutants Reduced/Treated

1 11 1

3.9

0

1

2

3

4

FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 Proj(12/3/08)

Billi

ons

EOY Average FY 04-08

Calculated FY 09 EOYPrediction

Projected Cases

Lodged

Entered/Final Order Issued(as of 12/3/08)

Final EOY Lodged (42 M)

Proj (277 M)

Ent/Iss (37M)

.36

9

Top 5 FY09 Cases -Pollutant ReductionAs of 12/8/20081. 130 Million Lbs. – Region 3 – K Hovanian 2. 60 Million Lbs. – Region 5 – LaFarge North America

Inc. (National Case)3. 53 Million Lbs. – Region 7 – City of Kansas City, MO4. 48 Million Lbs. – Region 6 – Big Cajun 2 5. 43 Million Lbs. – Region 4 – Kentucky Utilities

• Also, 2 Billion Lbs. of Hazardous Waste – Region 4 – CF Industries

1010

Complying Action + SEP Value

$5

$10

$5

$11

$12

$15

$0

$2

$4

$6

$8

$10

$12

$14

$16

FY 04 FY 05 FY 06 FY 07 FY 08 FY 08 Proj(12/3/08)

Billi

ons

EOY Average FY04-08

Calculated FY 09EOY Prediction

Projected Cases

Lodged

Entered/FinalOrder Issued (asof 12/3/08)Final EOY

Ent/Iss ($80M)

Lodged ($1.2B)

Proj ($13.8

11

Top 5 FY09 Cases – Complying Action + SEPAs of 12/8/081. $3.7 Billion – Region 7 – St. Louis, MO2. $3.4 Billion – Region 5 – Chicago, IL3. $2.3 Billion – Region 7 – City of Kansas, MO4. $1 Billion – Region 2 – PRASA VI5. $750 Million – Region 7 – Westar Energy, Inc.

1212

Total Civil Penalty Values

$127

$70

$124

$154$149

$236

$0

$50

$100

$150

$200

$250

FY 04 FY 05 FY 06 FY 07 FY 08 FY 08 Proj(12/3/08)

Mill

ions

EOY Average FY04-08

Projected Cases

Lodged

Entered/FinalOrder Issued (asof 12/3/08)

Final EOY Penalties Values in Previous Concluded Fiscal Years include Default Judgements.

(Lodged

$3M)

Ent/Iss ($3M)

Proj ($230M)

13

Top 5 FY09 Cases – Civil PenaltyAs of 12/8/08

1. $$$ - Region 5 - Scotts2. $20 - HQ - DuPont3. $17 - Region 5 - U.S. Steel4. $17 - Region 6 - BP North America5. $10 - Region 5 - EES Coke Battery

1414

Estimated Soil to be Cleaned-Up (Cubic Yards)

2815

79

100

3

49

0

20

40

60

80

100

120

FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 Proj(12/3/08)

Mill

ions

EOY Average FY 04-08

Calculated FY 09 EOYPrediction

Projected Cases

Lodged

Entered/Final Order Issued(as of 12/3/08)

EOY FinalEnt/Iss (2M)

Lodged (2M)

Proj ($45M)

15

Top 5 Projected Cases – VCMA Soil1. 45 Million Cu. Yds. – Region 7- Doe Run Resources 2. 64,000 Cu. Yds. – Region 4 - Weyerhouser Company3. 50,900 Cu. Yds. – Region 7- Chemical Commodities4. 26,000 Cu. Yds. – Region 1- Shpack Landfill

Superfund Site5. 16,454 Cu. Yds. – Region 7- Des Moines Ex Ordance

Site

1616

Contaminated Water/Aquifer Cleaned (Cubic Yards)

10

1,600

1,300 1,370

255

0200400600800

1,0001,2001,4001,6001,800

FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 Proj(12/3/08)

Mill

ions

EOY Average FY04-08

Calculated FY 09EOY Prediction

Projected Cases

Lodged

Entered/FinalOrder Issued (asof 12/3/08)EOY Final

22.7

Lodged (6.1M)

Ent/Iss (6.8M)

Proj (9.7M)

1717

Cost Recovery

$226

$157

$249

$164

$252

$232

0

50

100

150

200

250

300

FY 03 FY 04 FY 05 FY 06 FY 07 FY 08 FY 08 Proj(12/3/08)

Mill

ions

EOY Average FY04-08

Calculated FY 09EOY Prediction

Projected Cases

Lodged

Entered/Final OrderIssued (as of12/3/08)EOY Final

$88

Proj ($44M)

Ent/Iss ($24M)

Lodged ($20M)

18

Observations About Preliminary FY 2009 Projections Today’s projections are very rough and

incomplete Haven’t yet identified all the big cases Don’t have pollutant reduction estimates for most

cases HQ-generated big case list did not include CERCLA

Management focus on identifying and concluding cases with significant pollutant reductions

Preliminary projections suggest a record-breaking year in civil penalties?!

19

OCE Process for Big Case Pipeline Management in FY2009 Work with Regions & OC to refine “Big Case List” and

Estimates of Results Provide List to DOJ Early in the New Year to Target

Cases Critical for Completion During FY 2009 and FY2010

Plan for Focusing on a Few Cases Each Quarter to Complete

Use DOJ/Regional Docket Reviews, OCE/DOJ Biweekly Meetings, ICIS “Big Case” Quarterly Reports, and Enforcement Director Calls to Track Progress.

20

Looking Ahead to 2010 and Beyond “Big Cases” Take Longer – Need to Develop Plans Now

for 2010 Results Need to Maintain Level of Referrals HQ Needs to Identify and Manage Possible National

Cases Will We Be “Done” With Current Priorities? Older referrals. Are there big case “diamonds in the

rough”? If not, decide what to do? Moving beyond pounds to better characterize pollutants:

e.g., toxic equivalents, risk modeling and quantitative benefits.