The EPA’s Priority List and how to avoid it!
Regulatory enforcement by the Environmental Protection Agency of the food and drink sector has a real impact on the day to day running of a business. The vast majority of complaints the EPA receives are made in relation to the food and drink or waste sectors. This has led to the EPA prioritising its enforcement efforts in these sectors.
Throughout 2016, the EPA conducted 1,539 site visits, according to its ‘Year in Review’ Report 2016. It is essential for food and agribusiness licensees to know and understand the regulatory landscape in order to implement plans and procedures now that will prevent enforcement later.
EPA Enforcement Report 2015
The EPA Industrial and Waste Licence Enforcement Report 2015 (the ‘2015 Report’) notes that the food and drink and waste sectors have some work to do to improve their environmental compliance.
In policing the food and drink and waste sectors, the EPA relies heavily on complaints from the public to target its enforcement activity. Close to 1,100 complaints about licensed facilities were logged by the EPA in 2016. Most of the complaints (66 per cent) related to odour nuisance. Ten sites accounted for 64 per cent of all complaints and non-compliances in 2016. The main complaints about those 10 sites related to poor operational procedures and inadequate infrastructure.
EPA prosecutions of food and drink sector businesses
Of all the convictions by the EPA over the last five years, 39 per cent were secured against licensees operating in the food and drink sectors. This figure does not include EPA prosecutions taken against companies which were given the benefit of the Probation Act instead of being convicted.
Two of the three convictions recorded so far in 2017 relate to pig farmers. In 2016, 17 prosecution cases were heard, of which 11 related to industrial or waste licensed sites. The most common charges related to breach of emission limit values, odour nuisance and monitoring failures. In 2015, the EPA concluded 13 summary prosecutions in the District Court. Four of these were taken against food and drink sector licensees and four were taken against other industrial or intensive agriculture facilities.
Consequences of enforcement on directors
Directors can be held personally liable for breaches of EPA licences and environmental standards by a company, especially if a company has already been convicted of an offence. In practice, the EPA tends (for the most part) not to pursue directors if a company is being prosecuted for the first time.
Based on the EPA website, just six District Court prosecutions have been taken against directors of companies since 2009. No fines greater than €5,000 and no prison sentences have been imposed. Only one of the cases was heard on indictment before the Circuit Court, where fines of up to €15,000,000 per offence and longer prison sentences may be imposed.
The EPA National Priority Site List
From January 2016, the EPA rolled out an updated methodology for determining which licensed sites should be deemed an enforcement priority and announced a ‘National Priority Site List’ (‘Priority List’). As things stand, there is no published guidance on how the Priority List will operate, the EPA website no longer references the Priority List and in these early days the EPA’s communication to licence holders has not been without error.
The EPA has written to certain companies and company directors advising that the relevant companies have scored a certain number of points and are being placed on the Priority List. In general, no points’ breakdown is provided. The EPA believes as a result of an increased and targeted enforcement focus on any Priority List site the relevant licensee will be “enforced back” to compliance as soon as possible.
The four main components of the points scoring systems are:
- Compliance Investigations (CIs);
- Incidents notified to the EPA by a licensee;
- Complaints received by the EPA; and
- Issued non-compliances.
If an issue has caused, is causing or has the potential to cause an environmental impact, the EPA opens a CI. Each CI is given a score based on its rating. This rating is gathered from data which takes account of the number of complaints about a site. Apparently, only complaints deemed to require a ‘medium’ or ‘high’ response level will be counted in the points total. Open CIs are scored higher than closed-out CIs.
In response to strong industry concerns, the EPA appears to have decided that, in the case of multiple CIs, only the three highest scoring CIs will be counted. This is meant to consider in part, the issue of repeat complaints on one single issue. A further change is that, as we understand it, the Priority List will now use data from the previous six months up to the end of the quarter to calculate a licensee’s overall score and position on the Priority List, as opposed to using the previous 12 months’ data. We also understand that point totals will be recalculated every three months to capture both improvements and deteriorations.
A licensee’s score is determined by how quickly and effectively it deals with CIs, incidents and complaints:
- sites with scores above 30 will be placed on a published Priority List;
- sites with scores between 20 and 30 will be considered ‘candidate’ sites meaning that while they are not a Priority Site, they are at risk of becoming one, and will be requested to rectify compliance issues; and
- sites with scores of less than 20 will not receive any communication from the EPA.
Action points
- With a view to avoiding being put on the Priority List we recommend licence holders:
- investigate, close out and record the closing out of third party complaints;
- prioritise dealing with CIs and close them out as swiftly as possible to ensure that the minimum number of points is scored; and
- notify the EPA immediately of any incidents, because the EPA considers non-notification, delayed notification or notification after a complaint has already made been to it, as one of the most serious issues that would prompt the allocation of the highest number of points and, most likely, would also prompt the service of a summons on a company and/or a company’s directors.
Conclusion
The publication of a Priority List will have a reputational impact on food and drink operators. The intended publication date is not known. Perhaps a leaf could be taken from the Scottish EPA. It publishes a ‘best performers’ list because its view is that this achieves better ‘wins’ for the environment than a ‘black list’.
Deborah Spence
Partner, Head of Environment & Planning
deborah.spence@arthurcox.com
Danielle Conaghan
Partner, Environment & Planning
danielle.conaghan@arthurcox.com
