Restoring Public Confidence in DTSC
A Message from Director Debbie Raphael
When the Legislature wrote the laws that govern the Department of Toxic Substances Control, the expectations were high.
We exist to protect the public by cleaning up properties contaminated by toxic chemicals, setting and imposing strict permit standards on facilities that handle hazardous waste and enforcing California’s tough hazardous waste laws on violators.
The public also has high expectations of us. For me, those expectations bring up words like effectiveness, value, transparency, public good, fairness and efficiency. When I came to the Department in 2011, we adopted a new vision statement that specifically addressed this expectation. This included establishing the confidence of communities who rely on us to protect them from toxic harm. An indication that we are meeting our mission to protect public health and the environment will be across-the-board confidence in the work that we do.
When I took over the department I found that key decisions had been postponed, there appeared to be a lack of accountability and, as a result, the department was lacking in focus. Early in my tenure as director, I identified several key parts of our program that needed improvement. I realized that DTSC could not continue down the path we had been headed for the past decade. Our permitting and enforcement were not as effective as they should have been; our proposal to take hazardous chemicals out of consumer products (the Safer Consumer Products regulation) had stalled, our personnel system was out of alignment and our finances were nearing a crisis point. We needed to take a careful look at the very foundation of the organization and not be afraid to institute important changes – I labeled these improvements our “Fixing the Foundation Initiative.” As of today, we’ve fixed many of those issues. Of course, there is more work to be done.
As one element of our “Fixing the Foundation” work, we decided to focus attention on our permitting program. At the beginning of the year, we contracted with an outside entity, California Personnel Services, to perform a wide reaching performance audit of the program.
Some of the issues I identified early on were recently called out in a report written by a private advocacy group that questioned our ability to enforce the law and ensure that permitted facilities operate safely. The report contained many errors and, more gravely, it misrepresented many of our actions. It also failed to mention the extensive information we provided the author during many hours of discussion.
In addition, following the release of this report, I met with members of the California State Senate who have asked the Senate Office of Oversight and Outcomes to investigate the claims. I fully support and welcome such an investigation, which will complement the external review of our permit program mentioned above. A report detailing the findings of our external review will be posted on our website when it is complete. We look forward to using the recommendations made in both the Senate’s investigation and in our own review to implement further changes to our programs.
In the same spirit of transparency, I’ve broken down for you what’s been done to improve our programs during the past 20 months. I’ve also identified the work that has been started but has yet to be completed.
Governor Brown has asked members of his administration to dig deep for solutions that might not have been thought of before. I take that to heart and interpret it to mean that I should not ignore shortcomings or settle for the status quo. I am dedicated to addressing the problems that exist within the department, and I want to build the confidence of all those we serve that we are indeed protecting you, your family and your environment from toxic harm.
By clicking on any of the links below you can see what we’re doing to serve you better. I will continue to update you on our progress.
Permitting & Enforcement | Green Chemistry | Fiscal Stability | Alleged Conflicts of Interest by DTSC Managers
Permitting and Enforcement
Soon after I became director, I learned there were problems in our permitting and enforcement programs. Many of these problems stemmed from lack of standards, guidance and accountability. Our tracking systems were broken, our management systems were poor and the two programs didn’t communicate well with each other. We appeared to have a culture of kicking hard decisions down the road.
From community members I heard complaints that our permit decisions were slow, often allowing decisions to extend well beyond the expiration date of a permit. Many of these same community members complained that our consent orders (negotiated orders that settled an enforcement action) occurred in the dark, without any opportunity for public involvement.
A year ago, I pulled together a large group of our key stakeholders representing every point of view and asked them to lay out the problems with our system and suggest how we might move forward. The input I received made it clear that the public had significant concerns about how we were managing hazardous waste in California.
We issue permits to 118 facilities that treat, store or dispose of hazardous waste. Each of these facilities must be inspected regularly and, where violations occur, must be subjected to enforcement. Effective enforcement begins with a strong permit. Part of the problem associated with making decisions stemmed from a lack of clarity on standards for suspension or revocation of a permit.
For the past several years, our enforcement and permitting programs were not aligned under a single management structure. Permit writers did their work without well documented procedures for consulting inspectors, and permit language was not always reviewed for enforceability. The result was that facilities could receive confusing signals with regard to operational requirements. For various reasons, permit decisions could take years to complete.
The permitting program needed to be closely aligned with enforcement. The two programs depend on each other to ensure that our permits can be used by inspectors in the field. I have placed the enforcement and permit programs under a single management team that will be held responsible for ensuring that the permits are written in a manner that allows inspectors to fully enforce the permit requirements.
We will establish clear guidance and expectations of the permitting program, and will cross-train our permitting and enforcement staff in order to improve coordination and develop strong, enforceable permits.
I have launched an independent, external review of our permit program. The purpose of this review is to identify weaknesses in our decision-making process and recommend a course of action, establish performance measures and make recommendations on standards we can use to clarify for the public and our permit writers when a permit application or requests to modify a permit should be denied.
I have hired a new permitting chief who shares my vision for the program and who will develop a team to address our most critical facilities, making sure our decisions fully protect the public
We have joined Governor Brown’s interagency working group to evaluate refinery safety and the adequacy of existing regulatory authorities and responsibilities. This effort will greatly add to the cooperation between agencies and provide a higher level of protection for surrounding communities.
We have changed our tracking system and assigned dedicated staff to better identify potential unauthorized or illegal hazardous waste facilities that require further investigation.
We are creating a team to comb through the hazardous waste tracking system to identify and correct data errors and omissions. We have hired a project manager within our IT program to evaluate and improve the quality of our hazardous waste data.
We will actively engage in the U.S. Environmental Protection Agency’s development of an automated electronic hazardous waste manifest tracking system that will reduce or eliminate errors typically found on handwritten manifests.
We will begin using the new tool, CalEnviroScreen, to identify communities and neighborhoods that are most impacted by pollution. This assessment tool will be used to help us prioritize our response to public complaints and focus an enforcement sweep of selected communities highly impacted by pollution.
We have launched a metal recyclers’ initiative that targets illegal recyclers that undercut legal businesses by operating without proper local permits or oversight and often leave behind dangerous wastes. We are pursuing enforcement actions stemming from two joint inspections that uncovered numerous serious violations at each site.
We are working with the California Attorney General’s office to develop updated guidelines on when to issue unilateral orders to correct or remedy violations or sue in court rather than pursue unproductive settlement negotiations.
We will launch a pilot project to encourage public comment on proposed settlement agreements, giving communities better opportunity to participate in our efforts to ensure violators are appropriately penalized.
We will make permitting information on our website more accessible and comprehensive by listing all permitted facilities, uploading information about those facilities, linking the information to enforcement records and uploading administrative records for facilities where we are currently making a permit decision.
When I arrived at DTSC, California’s groundbreaking Green Chemistry Initiative was three years old, but adoption of its main tenet – the Safer Consumer Products regulations – had stalled.
The regulations are a pioneering step in reducing toxic ingredients in the products that we buy every day. They require manufacturers whose consumer product contains a toxic ingredient to ask: “Is this ingredient necessary? Is there a safer alternative? Is that alternative ingredient feasible?”
This approach is more effective than previous efforts to eliminate toxic chemicals in consumer products. Historically, we would ban a toxic ingredient, substituting it with another toxic chemical that could be just as dangerous or more dangerous than the original.
I believe that requiring manufacturers to analyze alternatives to ingredients and to design safer products is a sound and ultimately profitable approach. It will encourage the kind of cutting edge innovation for which California is known, and it will level the playing field for those who already are doing the right thing.
AB 1879 required DTSC to adopt these regulations by January 1, 2011. We had already missed that deadline when I arrived.
A primary concern that led to the delay was stakeholder belief that the public had, at the last minute, been left out of the process. Many were uneasy with changes that had been made in what was then considered the “final” version of the regulation, and they expressed their concern with legislators, the media, and with DTSC management. In the final days of 2010, a decision was made to stop work on the regulation and ensure that stakeholders’ concerns were considered in an open manner.
When I became director in mid-2011, we launched a series of meetings with our Green Ribbon Science Panel and the public to look at very specific issues associated with the regulation. Through a lengthy public process, we rewrote the regulation and incorporated a tremendous amount of stakeholder input. We ensured the process was transparent and accessible to all and the result is language that is practical, meaningful and legally defensible.
I am happy to say that the Green Chemistry regulations are back on track, and we hope to have them finalized by July 1.
In preparation for implementation of the regulations, I have reorganized DTSC staff and created a Safer Consumer Products and Workplaces Program.
Staff in this program will be at the forefront of our mission to reduce hazardous waste by changing how society designs products and uses chemicals.
In 2011, DTSC was headed toward its own fiscal cliff. The ongoing recession and industry’s own efforts to reduce production of toxic materials had deeply impacted our two major funding sources – the Toxic Substances Control Account (TSCA) and the Hazardous Waste Control Account (HWCA).
About the time I arrived, we were spending about $17 million more from TSCA than we were bringing in, and the gap in HWCA funding was about $9 million. This rate of spending was unsustainable, leaving us with the very real possibility of layoffs and deep cuts that could have seriously disrupted our cleanup efforts.
The report conducted by the advocacy group misrepresented information regarding funding that DTSC has available for cleaning hazardous waste sites and other work.
To close the spending gaps in TSCA and HWCA, we tightened our financial belt. By July 1, 2013, we will have eliminated 71.8 positions from our budget. Most of these positions were cut a year ago, and all of them were vacant. Because we have been very judicious in filling vacant positions since my arrival, I am optimistic that our second round of cuts will also affect only vacant positions. Elimination of those positions will result in savings of $6,548,659.
By July 1, 2013, we also will have cut more than $2,091,000 in expenses by making some very difficult decisions. We dramatically cut our operating expenses by trimming facility costs at all of our offices, putting stringent restrictions on travel and other operating costs and by reducing more than $1.1 million in contracting costs for services from data entry to cleanup oversight costs.
Most significantly, our days of relying on account surpluses to bridge the gap between expenditures and revenues have passed. Other financial issues, such improvements in our ability to recover costs incurred from our environmental cleanups, also are being addressed more aggressively. I will keep you updated on the progress of a Cost Recovery Action Team we have dedicated to this effort.
This spring, the Administration will propose to streamline our hazardous waste fee system, modifying the fees to ensure long‑term stability of the Hazardous Waste Control Account, and aligning the fees with program objectives.
On a related issue, the $26 million fund balance that the advocacy group displayed in its section on budget information is not a “surplus.” Rather, the HWCA is DTSC’s clearing account, and almost all payables for the Department go through it. Therefore, the HWCA must have a cash balance sufficient to cover payables. The majority of DTSC’s annual revenues are not realized until the last quarter of the fiscal year. Because of this, the HWCA must have a cash balance that is sufficient to cover costs through the first three quarters of the fiscal year. Our revenues during the past 10 years have consistently been below revenue estimates and below our authorized expenditures.
Alleged Conflicts of interest by DTSC Managers
An advocacy organization claimed to have uncovered potential conflicts of interest for two of DTSC’s top managers. The group cited information contained in the disclosure form, known as a Form 700, which must be filed each year by DTSC decision makers. The same organization also alleges that I have had inappropriate meetings with an industry representative.
According to the Fair Political Practices Commission (FPPC), “a public official’s conflict of interest is disqualifying if the financial effect on his or her economic interest is distinguishable from the financial effect of the decision on the public generally. No one ever has a conflict of interest “on general principles” under the Political Reform Act - a conflict can only arise from the particular kinds of economic interests covered by the Act.”
It should be noted that the conflict of interest laws are not intended to deter state employees from having investments, but instead require designated employees and appointees to declare their holdings and follow conflict of interest laws when making decisions. Accordingly, an employee has not violated these laws merely by holding stock in a company that is subject to DTSC regulation. To the contrary, an employee only violates the conflict of interest laws when he or she makes, or participates in the making of, a decision that will foreseeably have a material financial effect on their investment.
The managers singled out by the advocacy organization are Chief Deputy Director, Odette Madriago, and Deputy Director for the Brownfields and Environmental Restoration Program, Stewart Black. They appear to have been singled out based solely on the fact that they own stock in companies regulated by DTSC. Notwithstanding these allegations, both Madriago and Black have fully disclosed their stock holdings by regularly filing their Form 700 as required by the FPPC.
As an added precaution, I asked DTSC’s legal office to review the forms filled out by Madriago and Black, and to assess the likelihood of violations of the conflict of interest laws by virtue of their stock ownership. Based on its review of the conflict of interest laws and the available information, the legal office advised me that it had not discovered any evidence that either Madriago or Black violated the conflict of interest laws.
Ultimately, however, it is the purview of the FPPC to determine whether state officials have acted properly. In the event an investigation is launched, we will fully assist the FPPC in its investigatory efforts and provide whatever additional assistance the FPPC requires.
To prevent conflicts of interest in the future, we will be both updating our regulations and providing an additional mandatory training to supplement the standard ethics training employees already are required to take every two years.
As to the allegation that I have met with an industry representative, I note that I meet regularly with all our stakeholders. In fact, several times a month I travel to various parts of the state to see sites, meet with community members, speak to stakeholder groups, or hear the concerns of the public. I try hard to be accessible and learn from the discussions I have with those who have an interest in our decisions. Frankly, we make better decisions when we understand all points of view. I have met many times with community groups representing environmental justice communities and I have met with business leaders whose industries are regulated by DTSC. None of my meetings with industry or any other representatives have been inappropriate.