BILL REQ. #:  H-0189.2 

Read first time 01/21/11.   Referred to Committee on Environment.

     AN ACT Relating to civil penalties under the clean air act; amending RCW 70.94.431, 43.21B.300, and 43.21B.300; adding a new section to chapter 70.94 RCW; and creating new sections.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   The legislature finds that there have been instances where regulatory agencies discovered actions by a regulated entity that are in error after reports have been accepted and approved or inspections have been conducted and approved. Retroactively applying fines after governmental approval creates an unfriendly business environment and can place unexpected financial burdens on businesses. Businesses should be able to rely on government approval and acceptance of reports and inspections and not risk penalties when mistakes are made by government personnel or contractors. It is the intent of the legislature that regulated parties who have received acceptance and approval by the regulating government authority should not be subsequently fined or penalized, but should be encouraged to correct action that is deemed in error or violates reporting or inspection requirements during the next reporting period. The regulating authority should notify the regulated party of the violation to prevent future violations.
     The legislature intends to remove the financial incentives for agencies to find violations. It is the intent of the legislature to remove the connection between penalty assessment and funding of the regulatory program and direct penalty assessments to be deposited in the state general fund.

NEW SECTION.  Sec. 2   A new section is added to chapter 70.94 RCW to read as follows:
     (1) Neither the department nor the authority may issue a fine or impose a penalty on a person for:
     (a) A violation resulting from an inspection that was not identified to the regulated party at the time of the inspection and where the inspection was approved by a government official; or
     (b) A violation based on failure to provide required documentation when the documentation submitted to the department or authority has been accepted and approved by a government official.
     (2) The department or the authority must notify the regulated party of the violation. Violations identified under subsection (1)(a) and (b) of this section may be remedied through technical assistance to the regulated party allowing them to correct the circumstances of the violation for future reporting periods or inspections.

Sec. 3   RCW 70.94.431 and 1995 c 403 s 630 are each amended to read as follows:
     (1) Except as provided in RCW 43.05.060 through 43.05.080 and 43.05.150, and in addition to or as an alternate to any other penalty provided by law, any person who violates any of the provisions of chapter 70.94 RCW, chapter 70.120 RCW, or any of the rules in force under such chapters may incur a civil penalty in an amount not to exceed ten thousand dollars per day for each violation. Each such violation shall be a separate and distinct offense, and in case of a continuing violation, each day's continuance shall be a separate and distinct violation.
     Any person who fails to take action as specified by an order issued pursuant to this chapter shall be liable for a civil penalty of not more than ten thousand dollars for each day of continued noncompliance.
     (2) Penalties incurred but not paid shall accrue interest, beginning on the ninety-first day following the date that the penalty becomes due and payable, at the highest rate allowed by RCW 19.52.020 on the date that the penalty becomes due and payable. If violations or penalties are appealed, interest shall not begin to accrue until the thirty-first day following final resolution of the appeal.
     The maximum penalty amounts established in this section may be increased annually to account for inflation as determined by the state office of the economic and revenue forecast council.
     (3) Each act of commission or omission which procures, aids or abets in the violation shall be considered a violation under the provisions of this section and subject to the same penalty. The penalties provided in this section shall be imposed pursuant to RCW 43.21B.300.
     (4) All penalties recovered under this section by the department shall be paid into the state treasury and credited to the ((air pollution control account established in RCW 70.94.015)) general fund or, if recovered by the authority, shall be paid into the treasury of the authority ((and credited to its funds)). If a prior penalty for the same violation has been paid to a local authority, the penalty imposed by the department under subsection (1) of this section shall be reduced by the amount of the payment.
     (5) To secure the penalty incurred under this section, the state or the authority shall have a lien on any vessel used or operated in violation of this chapter which shall be enforced as provided in RCW 60.36.050.
     (6) Public or private entities that are recipients or potential recipients of department grants, whether for air quality related activities or not, may have such grants rescinded or withheld by the department for failure to comply with provisions of this chapter.
     (7) In addition to other penalties provided by this chapter, persons knowingly under-reporting emissions or other information used to set fees, or persons required to pay emission or permit fees who are more than ninety days late with such payments may be subject to a penalty equal to three times the amount of the original fee owed.
     (8) By January 1, 1992, the department shall develop rules for excusing excess emissions from enforcement action if such excess emissions are unavoidable. The rules shall specify the criteria and procedures for the department and local air authorities to determine whether a period of excess emissions is excusable in accordance with the state implementation plan.

Sec. 4   RCW 43.21B.300 and 2010 c 84 s 4 are each amended to read as follows:
     (1) Any civil penalty provided in RCW 18.104.155, 70.94.431, 70.95.315, 70.105.080, 70.107.050, 88.46.090, 90.03.600, 90.46.270, 90.48.144, 90.56.310, 90.56.330, and 90.64.102 and chapter 90.76 RCW shall be imposed by a notice in writing, either by certified mail with return receipt requested or by personal service, to the person incurring the penalty from the department or the local air authority, describing the violation with reasonable particularity. Within thirty days after the notice is received, the person incurring the penalty may apply in writing to the department or the authority for the remission or mitigation of the penalty. Upon receipt of the application, the department or authority may remit or mitigate the penalty upon whatever terms the department or the authority in its discretion deems proper. The department or the authority may ascertain the facts regarding all such applications in such reasonable manner and under such rules as it may deem proper and shall remit or mitigate the penalty only upon a demonstration of extraordinary circumstances such as the presence of information or factors not considered in setting the original penalty.
     (2) Any penalty imposed under this section may be appealed to the pollution control hearings board in accordance with this chapter if the appeal is filed with the hearings board and served on the department or authority thirty days after the date of receipt by the person penalized of the notice imposing the penalty or thirty days after the date of receipt of the notice of disposition of the application for relief from penalty.
     (3) A penalty shall become due and payable on the later of:
     (a) Thirty days after receipt of the notice imposing the penalty;
     (b) Thirty days after receipt of the notice of disposition on application for relief from penalty, if such an application is made; or
     (c) Thirty days after receipt of the notice of decision of the hearings board if the penalty is appealed.
     (4) If the amount of any penalty is not paid to the department within thirty days after it becomes due and payable, the attorney general, upon request of the department, shall bring an action in the name of the state of Washington in the superior court of Thurston county, or of any county in which the violator does business, to recover the penalty. If the amount of the penalty is not paid to the authority within thirty days after it becomes due and payable, the authority may bring an action to recover the penalty in the superior court of the county of the authority's main office or of any county in which the violator does business. In these actions, the procedures and rules of evidence shall be the same as in an ordinary civil action.
     (5) All penalties recovered shall be paid into the state treasury and credited to the general fund except those penalties imposed pursuant to RCW 18.104.155, which shall be credited to the reclamation account as provided in RCW 18.104.155(7), ((RCW 70.94.431, the disposition of which shall be governed by that provision,)) RCW 70.105.080, which shall be credited to the hazardous waste control and elimination account created by RCW 70.105.180, RCW 90.56.330, which shall be credited to the coastal protection fund created by RCW 90.48.390, and RCW 90.76.080, which shall be credited to the underground storage tank account created by RCW 90.76.100.

Sec. 5   RCW 43.21B.300 and 2010 c 210 s 12 are each amended to read as follows:
     (1) Any civil penalty provided in RCW 18.104.155, 70.94.431, 70.95.315, 70.105.080, 70.107.050, 88.46.090, 90.03.600, 90.46.270, 90.48.144, 90.56.310, and 90.56.330 and chapter 90.76 RCW shall be imposed by a notice in writing, either by certified mail with return receipt requested or by personal service, to the person incurring the penalty from the department or the local air authority, describing the violation with reasonable particularity. For penalties issued by local air authorities, within thirty days after the notice is received, the person incurring the penalty may apply in writing to the authority for the remission or mitigation of the penalty. Upon receipt of the application, the authority may remit or mitigate the penalty upon whatever terms the authority in its discretion deems proper. The authority may ascertain the facts regarding all such applications in such reasonable manner and under such rules as it may deem proper and shall remit or mitigate the penalty only upon a demonstration of extraordinary circumstances such as the presence of information or factors not considered in setting the original penalty.
     (2) Any penalty imposed under this section may be appealed to the pollution control hearings board in accordance with this chapter if the appeal is filed with the hearings board and served on the department or authority thirty days after the date of receipt by the person penalized of the notice imposing the penalty or thirty days after the date of receipt of the notice of disposition by a local air authority of the application for relief from penalty.
     (3) A penalty shall become due and payable on the later of:
     (a) Thirty days after receipt of the notice imposing the penalty;
     (b) Thirty days after receipt of the notice of disposition by a local air authority on application for relief from penalty, if such an application is made; or
     (c) Thirty days after receipt of the notice of decision of the hearings board if the penalty is appealed.
     (4) If the amount of any penalty is not paid to the department within thirty days after it becomes due and payable, the attorney general, upon request of the department, shall bring an action in the name of the state of Washington in the superior court of Thurston county, or of any county in which the violator does business, to recover the penalty. If the amount of the penalty is not paid to the authority within thirty days after it becomes due and payable, the authority may bring an action to recover the penalty in the superior court of the county of the authority's main office or of any county in which the violator does business. In these actions, the procedures and rules of evidence shall be the same as in an ordinary civil action.
     (5) All penalties recovered shall be paid into the state treasury and credited to the general fund except those penalties imposed pursuant to RCW 18.104.155, which shall be credited to the reclamation account as provided in RCW 18.104.155(7), ((RCW 70.94.431, the disposition of which shall be governed by that provision,)) RCW 70.105.080, which shall be credited to the hazardous waste control and elimination account created by RCW 70.105.180, RCW 90.56.330, which shall be credited to the coastal protection fund created by RCW 90.48.390, and RCW 90.76.080, which shall be credited to the underground storage tank account created by RCW 90.76.100.

NEW SECTION.  Sec. 6   This act shall be liberally construed to give full effect to the objectives and purposes for which it was enacted.

NEW SECTION.  Sec. 7   If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.