California Subjects Hazardous Waste Facilities to New "Scoring" System That Raises Stakes for Challenging Alleged Compliance Violations

Alerts / November 15, 2018

Starting in 2019, California will subject hazardous waste facilities operating in the state to a “scoring” system called the Violations Scoring Procedure (VSP). The California Department of Toxic Substances Control (DTSC) will annually assign each facility a VSP score based on its prior 10-year compliance history. A VSP score that is not in the “acceptable” range will have significant adverse implications for the facility, up to revocation of its hazardous waste permit. This new scoring system therefore raises the stakes for each of DTSC’s compliance investigations and for facilities’ challenges to any alleged compliance violations.

The regulations establishing the new VSP system are found in amended Title 22, Division 4.5, Chapter 21, Article 3 of the California Code of Regulations and are effective as of Jan. 1, 2019.

I. Overview of DTSC’s VSP Scoring System

Under DTSC’s new VSP scoring system, each hazardous waste facility is assigned to one of three compliance tiers based on its VSP score: “Acceptable,” “Conditionally Acceptable” or “Unacceptable.” A VSP score less than 20 is Acceptable; one equal to or greater than 20 but less than 40 is Conditionally Acceptable; and one equal to or greater than 40 is Unacceptable. The “Unacceptable” designation triggers a process that could result in the revocation of the facility’s hazardous waste permit or other limitations on operations. The “Conditionally Acceptable” designation can result in DTSC imposing additional measures on a facility, including requiring third-party audits, restrictions or prohibitions on hazardous waste management activities, mitigation measures, new permit conditions or shortened permit duration. The “Acceptable” designation has no immediate implications, but if the facility is on the cusp of a VSP score of 20, it should be vigilant about staying below that threshold.

Only Class I violations (i.e., violations that represent a significant threat to human health or safety or the environment) are considered in calculating the VSP score. Each such violation is assigned a score between 2 and 25 based on a matrix categorizing both the extent of deviation from compliance and the potential for harm as major, moderate or minimal. Accordingly, the highest score (i.e., 25) is for a violation that is a major deviation from full compliance and has a major potential for harm, the lowest score (i.e., 2) is for a violation that is a minimal deviation from full compliance and has minimal potential for harm, and scores in between are for intermediate combinations of major, moderate or minimal deviations and potentials for harm. Scores for repeat violations are adjusted upward by 25 percent (second), 50 percent (third) and 100 percent (fourth+) if the repeat violations occur within the longer of the three prior years or three prior inspections. The violations alleged in a given compliance inspection constitute the inspection violation score for that inspection. The VSP score is calculated annually and is the sum of the provisional or final inspection violation scores for each compliance inspection over the preceding 10 years, divided by the total number of inspections.

Facilities are notified of their VSP scores by Sept. 30 of each year for the rolling 10-year period ending Dec. 31 of the prior year.

II. Steps Facilities Can Take to Guard Against Problematic VSP Scores

It is critical that a facility consider how each alleged violation could affect its VSP score. Because a facility’s VSP score is based on the rolling 10-year average of its inspection violation scores, a bad score in just one inspection can impact the facility’s VSP score for the next decade.

To guard against a VSP score that would trigger adverse action, facilities should seriously consider grounds for challenging alleged violations on the merits. The VSP does not take into account violations that are canceled, retracted, withdrawn or successfully challenged.

Facilities should also consider disputing DTSC’s inspection violation scores, even if the alleged violation itself is not challenged on the merits. DTSC must provide the facility with a provisional inspection violation score for each compliance inspection contributing to the facility’s VSP score. The new regulations outline a dispute resolution process for disputing provisional inspection violation scores.

Authorship Credit: Robert N. Steinwurtzel and Thomas E. Hogan.

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