6. The Appeal and Cross-Appeal On appeal, Region V argues that the ALJ erred in reducing the penalty and asks the Board to reinstate the proposed penalty. More specifically, Region V argues, inter alia, that: (1) the ALJ erred by failing to take into account under Count I of the Complaint evidence of the environmental risks posed by Capozzi's noncompliance; (2) the ALJ erred by rejecting the Region's economic benefit analysis for Count I; and (3) the ALJ's alleged failure either to apply EPA's RCRA Civil Penalty Policy of October 1990 (the "Penalty Policy"), or to adequately explain his departure from the Policy, renders his penalty determination for Counts I, III, IV, V, and VI arbitrary and capricious. Capozzi's Cross-Appeal, which was filed on April 16, 2002, raises five issues: (1) whether the total penalty assessed by the ALJ is excessive; (2) whether the ALJ erred when he found that a violation occurred during the period June 30, 1995, to October 26, 1995; (3) in the alternative, if a violation did occur during the period June 30, 1995, to October 26, 1995, whether the ALJ erred with respect to his determination of the amount of waste Capozzi discarded; (4) whether the ALJ erroneously failed to apply the RCRA Penalty Policy principle regarding multiple violations springing from the same transgression; and (5) whether the ALJ erred in issuing a compliance order. II. DISCUSSION We now turn to the issues presented on appeal. In sections II.A.1-.5, we address the issues raised in Capozzi's Cross-Appeal, and in sections II.B.1-.7, we address the issues raised in Region V's Appeal. The Board generally reviews the ALJ's factual and legal conclusions on a de novo basis. See 40 C.F.R. § 22.30(f). A. Capozzi's Arguments on Appeal 1. The Duration of Capozzi's Disposal Violations Capozzi argues that the ALJ erred when he found that the disposal violations occurred during the four-month period from June 30, 1995, to October 25, 1995. See Capozzi Cross-Appeal at 10. According to Capozzi, its violations occurred prior to June 30, 1995 and, thus, were beyond the statute of limitations19 19 The parties agree that the Region is restricted to the five-year statute of limitations contained in 28 U.S.C. § 2462, which provides in relevant part: Except as otherwise provided by Act of Congress, an action, suit or pro- Continued date of June 30, 1995. Id. Capozzi also asserts that OEPA and U.S. EPA inspectors did not determine the precise dates of disposal, frequency of disposal, or amounts disposed of and, accordingly, failed to establish that violations occurred during the period June 30, 1995, to October 25, 1995. Id. at 12. By contrast, the Region argues that the ALJ's decision on this point is fully supported by the evidence in the record. 20 Based on our review, we reject Capozzi's claims as they are contradicted by the evidence in the record, and the reasonable inferences of fact that this evidence supports. First, the Region firmly established that Capozzi's routine method of disposing of solvent waste was to throw it onto the ground immediately outside the finishing room door or to place it in the facility's dumpster. It established this by offering the admissions of John Capozzi, see Tr. I at 49 ("I toss it out. It's been tossed out the back door."), and Cindy Garris, id. at 54; Tr. II at 539 (informing Inspector Fodo that, in addition to the waste that was sometimes discarded in the facility's dumpster, one gallon of solvent waste was thrown out the back door of the finishing room and onto the ground every two weeks). Notably, neither John Capozzi nor Cindy Garris stated that it was a rare practice or one that had ceased prior to the October 26, 1995 inspection. Additionally, Inspector Fodo testified during the evidentiary hearing that during the first OEPA inspection, Mr. Capozzi estimated that one gallon-sized coffee can of waste was disposed of every two or four weeks. Tr. I at 51. On appeal, however, Mr. Capozzi claims that he never informed Inspector Fodo that his workers disposed of a gallon of waste every two weeks. See Capozzi Cross-Appeal at 5. Rather, Mr. Capozzi claims that he had stated that it took one or two weeks to fill a can with lacquer thinner, but since some of that thinner is reused, a gallon of waste was not actually discarded every two or four weeks. Id. (continued) cuniary or otherwise, shall not be entertained unless commenced within 28 U.S.C. § 2462. The Region, however, asserts that while it limited its penalty proposals to the 119-day period between June 30, 1995, and October 26, 1995, its Amended Complaint did not similarly limit the periods of violation to that 119-day period. See Brief of Complainant Cross-Appellee at 17-22. Rather, the Region asserts that, at least for Counts III and IV, the actual statute of limitations date is March 21, 1995. Id. 20 In the alternative, the Region argues that even if the ALJ erred when he determined that Capozzi disposed of hazardous waste during the period between June 30, 1995, and October 25, 1995, Capozzi would nevertheless be liable under either the "continuing violation principle" or the "relation-back rule." See Brief of the Complainant-Cross-Appellee at 14, 21. Because, as discussed below, we conclude that the evidence supports the ALJ's conclusion that Capozzi illegally disposed of its hazardous waste during the relevant time period, we need not reach these alternative theories. We find it telling, however, that Capozzi offers no similar explanation for Cindy Garris' statement to Inspector Fodo. Specifically, Ms. Garris indicated during both the October 26, 1995 and May 23, 1996 inspections that, in the four and a half to five years she had been employed by Capozzi, the facility disposed of one gallon of solvent waste every two weeks. See Tr. I at 54, 72, 206-07; Tr. II at 531, 539. Thus, even if we accept Capozzi's claim that Inspector Fodo had misunderstood Mr. Capozzi's statements, we are still left with Ms. Garris' statements, which Capozzi has made no attempt to explain or discredit. Furthermore, as the Region points out, the results of OEPA's October 26, 1995 soil sample, in conjunction with the testimony of Capozzi's witness, Laura Lyden, supports the conclusion that Capozzi did, in fact, dispose of solvent waste after June 30, 1995. See Brief of the Complainant-Cross-Appellee at 13. Specifically, Ms. Lyden testified that volatile organic wastes such as Capozzi's would likely evaporate quickly if, after being discharged in small amounts, they were exposed to sunlight and heat. See Tr. II at 568, 571-72. Since Capozzi maintains on appeal that it always discharged solvent waste in small amounts, see Capozzi Cross-Appeal at 1, 14, if Capozzi had not disposed of its wastes between June 30, 1995, and October 25, 1995, one would have expected the soil sample taken outside the facility's finishing room door by Inspector Fodo on October 26, 1995, not to indicate the presence of VOCs. Rather, VOCs discarded prior to June 30, 1995 would have been expected to have long since evaporated in the summer heat. This, however, was not the case. As noted earlier, the October 26, 1995 soil sample indicated the presence of acetone, methyl isobutyl ketone, and toluene. Tr. I at 86, 92-96; C Ex 2. Therefore, the testimony of Capozzi's witness, taken in conjunction with the data from the October 26, 1995 inspection, tends to corroborate the conclusion that Capozzi disposed of VOCs after June 30, 1995. Thus, based on the weight of the evidence, it was reasonable for the ALJ to infer that Capozzi's disposal violations occurred on a regular basis during the four-month period from June 30, 1995, to October 25, 1995. Accordingly, we affirm the ALJ's ruling on his issue. 2. The Volume of Capozzi's Hazardous Waste Capozzi also challenges the ALJ's determination that Capozzi disposed of eight gallons of solvent waste in the four-month period between June 30, 1995, and October 25, 1995. Capozzi bases its challenge on: (1) John Capozzi's statements that he purchased seventy-eight gallons of lacquer thinner every year, that the only lacquer thinner discarded was that used to clear the spray gun after applying paint, and that less than ten jobs per year required paint; and (2) Capozzi's (post-inspections) Hazardous Waste Disposal Log, which showed that Capozzi generated waste at a rate of five gallons per year. See Capozzi Cross-Appeal at 13. We are not persuaded by Capozzi's argument regarding the volume of waste dis carded because it is squarely contradicted by statements made by John Capozzi and Cindy Garris. At the outset, we note that Mr. Capozzi's estimate of the volume of hazardous waste disposed at this facility has changed frequently. For example, prior to receiving a letter from OEPA detailing its findings from the May 23, 1996 inspection,21 Mr. Capozzi estimated that his facility disposed of hazardous waste at a rate of two gallons per month. Tr. I at 110, 235-36. However, after receiving the letter, Mr. Capozzi amended his estimate to 1.6 gallons per month. See C Ex 15. Finally, after the Region initiated its enforcement action, Mr. Capozzi further amended his estimate to 0.4 gallons per month. See Post-Hearing Brief at 2-3. Capozzi's argument is also undermined by statements made by Cindy Garris during the October 26, 1995 and May 23, 1996 inspections, wherein she indicated that in the four-and-a-half to five years she had worked for Capozzi, solvent waste had been disposed of by either placing it in a solid waste dumpster or by tossing it out the finishing room door at a rate of one gallon every two weeks. See Tr. I at 54; Tr. II at 539, 672.22 Capozzi's argument is further contradicted by John Capozzi's statement to Inspector Nesbit during the May 23, 1996 inspection, that in the seven months between the two inspections, the facility had accumulated between fifteen and thirty gallons of hazardous waste. See Tr. I at 110, 235. In addition, John Capozzi testified during the hearing held in this matter that after the first OEPA inspection on October 26, 1995, the facility accumulated eight gallons of hazardous waste from one job alone.23 21 See Letter from Karen L. Nesbit, OEPA, to John Capozzi, Capozzi Custom Cabinets (July 8, 1996); C Ex 8. 22 Notably, Mr. Capozzi's daughter, Ruth Ann Capozzi-Gray, testified that she was with Cindy Garris when Ms. Garris informed the OEPA inspectors that she (Ms. Garris) had placed solvent waste "in a can," and disposed of it "out the back door." See Tr. II at 539. 23 We note in particular the following passage from Mr. Capozzi's testimony: Q. Following that [October 26, 1995] inspection did you get a job re- A. Yes. Q. When Ms. Nesbit testified and Mr. Fodo put in his report that there A. Yes. Q. You heard that? A. Yes. Q. And, do you recall approximately how much waste would have been Continued Likewise, we are not persuaded by Capozzi's Hazardous Waste Disposal Log, which purportedly shows that Capozzi generated waste at a rate of five gallons per year. Based on this figure, Capozzi appears to argue that during the four months in question, it generated only 1.6 gallons of waste. The Region argues that it has "refuted any notion that the [Hazardous Waste Disposal] Log supports [Capozzi's] claims of a waste generation rate of 5 gallons per year***." Brief of the Complainant-Cross-Appellee at 22. We agree. Inasmuch as the Log was prepared after both of OEPA's inspections, and its entries are inconsistent with the information provided by John Capozzi and Cindy Garris prior to the commencement of an enforcement action against Capozzi, we find it self-serving and unreliable. Accordingly, we affirm the ALJ's holding that Capozzi disposed of eight gallons of solvent waste between June 30, 1995, and October 25, 1995. 3. Multiple Violations Springing from a Single Transgression Capozzi alleges that the ALJ also erred by not reducing the penalty he assessed against Capozzi based on the RCRA Penalty Policy's principle regarding multiple violations springing from a single transgression. See Capozzi Cross-Appeal at 19. According to Capozzi: [T]he Penalty Policy explains that a separate penalty Id. at 19-20. At the outset, Capozzi's argument incorrectly assumes that the ALJ was obligated to follow whatever guidance the RCRA Penalty Policy provided on this point. As the Board has explained on numerous occasions, penalty policies do not bind either the ALJ or the Board since these policies, not having been subjected to the rulemaking procedures of the Administrative Procedure Act, lack the force of law. In re Employers Ins. of Wausau, 6 E.A.D. 735, 758 (EAB 1997); e.g., In re Allegheny Power Serv. Corp., 9 E.A.D. 636,658-59 (EAB 2001), aff'd No. 6:01-cv-241 (S.D. W.Va. Apr. 5, 2002). (continued) A. Approximately eight gallons. Tr. II at 638 (Direct examination of John Capozzi by his attorney, Mary Davis). |