the results of that inspection, a complaint was issued on October 17, 1985, charging DOH with the above-mentioned violations of TSCA.3 In its answer to the complaint, DOH admitted its liability for the violations which underlie this appeal.

On appeal, DOH does not dispute that the assessed penalty was properly calculated as a matter of law. Rather, DOH argues that the circumstances of this case mitigate against assessment of the full penalty proposed by the Region. DOH asserts that it initiated contact with Region III, culminating in the instant complaint, by requesting the Region's assistance in complying with TSCA's requirements; that it corrected all deficiencies within a month of receipt of the Region's inspection report; that it has been in substantial compliance with TSCA's inspection recordkeeping requirements; and that the assessed penalty is excessive when compared to amounts assessed for criminal violations of TSCA and the Clean Air Act, 42 U.S.C. §7401 et seq., particularly since no harm to persons or the environment resulted from DOH's non-compliance. After thorough review of the record, I hold that the ALJ did not abuse his discretion in assessing the instant penalty.

II

An ALJ's decision assessing a penalty under TSCA's penalty guidelines must be reasonable, supported by the record and stated with clarity so as to reveal his reasoning process.5 Upon appeal, review must accord deference to the regulatory delegation of discretion to the ALJ in assessing a penalty. For example, if his penalty assessment is within the range of penalties prescribed by the guidelines for a particular violation, there is a strong presumption that the penalty is correct. Thus, it has been held that "* * absent

*

3 The complaint also charged DOH with failure to conduct quarterly inspections of the transformers. This charge was subsequently withdrawn by Region III. See Complainant's Brief in Support of the Penalty Proposed in the Complaint, February 28, 1986.

4 In assessing a penalty under TSCA, the ALJ is required to consider "the nature, circumstances, extent and gravity of the violation or violations and, with respect to the violator, ability to pay, effect on ability to continue to do business, any history of prior such violations, the degree of culpability, and such other matters as justice may require." 15 U.S.C. §2615(a)(2)(B). The ALJ must also consider any civil penalty guidelines issued under the Act. 40 CFR §22.27(b). In this case, the ALJ considered the Guidelines for the Assessment of Civil Penalties Under Section 16 of the Toxic Substances Control Act as supplemented by the PCB Penalty Policy, 45 Fed. Reg. 59770 (September 10, 1980).

5 See In the Matter of Bell & Howell, TSCA-V-C-033, 034, 035 (Final Decision, December 2, 1983).

unusual or other compelling circumstances it would be inappropriate on appeal to change the penalty if it falls within this range."6 If the penalty falls outside the range prescribed by the guidelines, no presumption is raised and review of the penalty will be conducted in the same manner as any other finding of the presiding officer.7 Here, DOH has not persuaded me that the assessed penalty either falls outside of the range prescribed by the guidelines or is otherwise inappropriate based upon a failure of the ALJ to properly exercise his discretion.

DOH has stipulated that the penalty has been properly calculated as a matter of law. Therefore, this appeal is directed toward determining whether the ALJ abused his discretion in the weight given to the alleged mitigating factors asserted by DOH. I find that the ALJ did not abuse his discretion. The assessed penalty is the product of a proper application of the statutory factors and of the TSCA penalty guidelines.8 Those factors and guidelines require the ALJ to consider the mitigating circumstances alleged by DOH, both in the mechanical calculation of the gravity-based penalty and in the factors considered toward adjustment of that penalty.

DOH argues that a further adjustment to decrease the penalty is warranted insofar as it initiated the sequence of events resulting in the filing of this complaint by requesting the Region's assistance in complying with TSCA's requirements. The ALJ, in consideration of this circumstance, adopted the Region's proposed 15% reduction of the gravity-based penalty, resulting in an assessed penalty of $22,950. Consideration of this circumstance is prescribed by both section 16 of TSCA ("degree of culpability") and by the penalty guidelines ("culpability"). Since the ALJ considered DOH's culpability in reducing the proposed penalty by 15%, DOH is apparently arguing that the ALJ did not give enough weight to this circumstance in reducing the penalty.

I am not persuaded that DOH's "culpability"-or lack thereofmerits more weight than the ALJ gave it in his penalty calculation. As noted in the Initial Decision, the original gravity-based penalty of $27,000 represents the least of several penalty options rec

6 Id. at 19.

740 CFR § 22.27(b) merely directs the ALJ to "consider any civil penalty guidelines issued under the Act."

8 See n. 4, supra.

ommended under the penalty guidelines. Initial Decision at 5-6.9 DOH's argument that it is entitled to an even greater penalty reduction ignores the fact that DOH is charged with notice of the applicable regulations as of the date they became effective, July 2, 1979.10 TSCA's penalty guidelines expressly state that "the Agency has no intention of encouraging ignorance of TSCA and its requirements.” 11 Therefore, DOH should have been in compliance with the regulations five years before it contacted the Region for assistance.

DOH's delay in regulatory compliance must be weighed against Congress' intent “* * * that EPA address the problem of contamination of the environment by PCB's to the greatest extent possible." 12 This congressional intent has given rise to an Agency enforcement policy and penalty structure which places limits on respondents who allege ignorance of the applicable regulations. Consistency of enforcement and the seriousness of purpose of the Agency's PCB enforcement scheme would be undermined if delay in compliance were greatly discounted merely because, at some late date, an offender sought EPA's assistance. Nor does congressional intent waver where, as here, there has been no known present damage to human health or the environment. The Agency's TSCA enforcement program is prophylactic; it is intended to prevent potential health or environmental accidents from ever occurring. 13 Further, the penalty guidelines take into consideration a lack of damage in the penalty calculus by its scale of "circumstances" (probability of damage) in the gravity-based penalty matrix. 14

DOH alleges, as a further example of its good faith, that it remedied the violations within a month of the inspection and notice of the deficiencies. The ALJ held that evidence of attempts to come into compliance with the regulations after notification by the Agency is "generally❞ irrelevant to the calculation of a penalty and therefore not entitled to any weight. In the context of this case, and in light of the prophylactic purpose of TSCA's PCB regulations, I agree that DOH's subsequent compliance was neither relevant nor entitled to any weight as to the issue of an additional reduction of the penalty.

9 The maximum penalty recommended by the penalty guidelines, under these circumstances, is $35,000 (had the recordkeeping violation been assessed as a "level 4" major violation). 45 Fed. Reg. at 59778.

10 44 Fed. Reg. 31514 (May 31, 1979).

11 45 Fed. Reg. at 59778.

12 44 Fed. Reg. at 31516.

13 See Briggs & Stratton, TSCA Appeal No. 81-1, at 16 (Final Decision, February 4, 1981).

14 45 Fed. Reg. at 59777.

Prior to the inspection, in the event of a PCB spill, necessary documentation would have been unavailable to assist a cleanup effort. 15

DOH also argues that the penalty assessed for Count 1 should be remitted because DOH was in "substantial compliance" with inspection and quarterly recordkeeping requirements. 40 CFR § 761.30(a)(1)(iv). Upon review of the record it is apparent that DOH's inspection reports fail to show the specific information required by the regulations. In particular, the records submitted by DOH make no mention of any inspection of the PCB transformers. 16 Nor is there any mention of the specific items required by the regulation to be reported for each transformer: location, date of visual inspection, and information regarding any leaks. DOH has not demonstrated that it was in substantial compliance with the applicable requirements.

Finally, the ALJ has fully addressed the lack of relevance, for comparative purposes, of criminal penalties assessed under TSCA and the Clean Air Act and I adopt his reasoning and conclusion by reference. 17

FINAL ORDER

The State of West Virginia, Department of Highways, shall pay a civil penalty of $22,950.00 for violations of the Toxic Substances Control Act of 1976 and its implementing regulations. Payment shall be made within 60 days, unless otherwise agreed to by the parties, by cashier's check or certified check, for the full amount of the penalty, payable to the Treasurer, United States of America, and mailed to EPA-Region III (Regional Hearing Clerk), P.O. Box 360515M, Pittsburgh, PA 15251.

So ordered.

15 The TSCA penalty guidelines emphasize that analysis of a violation “will always be based upon the risk inherent in the violation as it was committed." 45 Fed. Reg. at 59772 (emphasis in original).

16 See Tunnel Maintenance Activity 317 and Shift Log attached to DOH's Exchange of Witness Lists and Documents, filed December 16, 1985.

17 All other issues raised by the DOH and not discussed in this Final Decision have been thoroughly considered and rejected.

IN THE MATTER OF SANDOZ, INC.

RCRA (3008) Appeal No. 85-7

FINAL DECISION

Decided February 27, 1987

Before the Administrator, U.S. Environmental Protection Agency

Opinion by Ronald L. McCallum, Chief Judicial Officer:

Complainant, U.S. Environmental Protection Agency, Region IV (EPA), appeals from an Initial Decision issued on October 31, 1985, by Administrative Law Judge Thomas R. Yost (presiding officer). In that Initial Decision, the presiding officer held Respondent, Sandoz, Inc. (Sandoz), to be in violation of the Resource Conservation, and Recovery Act (RCRA) of 1976, as amended, and its implementing regulations. Specifically, the presiding officer held that Sandoz had failed to properly construct and operate a groundwater monitoring system in violation of 40 CFR Part 265, Subpart F. The presiding officer assessed a civil penalty of $7,500 against Sandoz, consisting of $6,500 for the violations plus $1,000 for Sandoz' estimated economic savings due to non-compliance.1 EPA appeals from that decision, arguing that the presiding officer erred by not assessing a penalty of $36,928 as proposed by EPA in the complaint. For the reasons stated below, I affirm in part and modify in part the Initial Decision.2

I

Since 1979, Sandoz has operated a plant in Martin, South Carolina, which produces dyes for polyester, nylon, paper and leather. As part of its wastewater treatment system, Sandoz constructed a

1 The presiding officer also ordered Sandoz to operate its EPA approved groundwater monitoring system, constructed during the litigation of this case, in strict compliance with South Carolina and Federal requirements. All other counts in the complaint were dropped by mutual agreement of the parties prior to the hearing.

240 CFR §22.30 provides that initial decisions of presiding officers may be appealed to the Administrator or his delegatee.