With its proposed revisions to California’s hazardous waste management regulations, the California Department of Toxic Substances Control (DTSC) continues to make California’s hazardous waste management program more onerous and complex than the federal Resource Conservation and Recovery Act (RCRA). DTSC proposes substantial changes to hazardous waste personnel training requirements, financial assurance obligations, and hazardous waste permitting decisions.[1] Almost every facility that manages hazardous waste in California will be impacted if DTSC’s proposal is finalized. Public comment on DTSC’s proposed revisions remains open through November 6, 2017.    

Proposed Hazardous Waste Personnel Training Revisions

As any company having undergone a hazardous waste facility inspection knows, inspectors routinely note alleged violations of personnel training requirements. With DTSC’s proposed revisions, which apply to any facility generating > 1,000 kg/month of hazardous waste, facilities should prepare for the potential for even more non-compliance allegations.

Under its proposal, DTSC expands personnel training requirements to incorporate Cal‑OSHA requirements for employees exposed or potentially exposed to hazardous substances.[2] Under the Cal-OSHA program, these requirements are limited to hazardous waste treatment, storage or disposal facilities (TSDFs). As drafted, DTSC’s revision does not clearly limit the Cal‑OSHA obligations to TSDFs. Similarly, DTSC’s proposal requires hazardous waste emergency response training programs to (i) include training on shutdown operations, self-protection measures and accident prevention methods; and (ii) incorporate safety and security considerations and standard operating procedures relevant to hazardous waste management. DTSC is also proposing that personnel engaged in shipping hazardous waste have triennial training in federal hazardous material shipping requirements.[3] Finally, DTSC’s proposal adds three new personnel training record-keeping requirements: (i) training records must document compliance with all aspects of the training program; (ii) employees must sign or certify records documenting their training; and (iii) facilities must submit an annual certification to DTSC attesting to employee training.

Proposed Financial Assurance Revisions

DTSC’s proposal drastically expands financial assurance requirements for corrective action, and TSDF closure and post‑closure costs. Historically, financial assurance for corrective action has generally been required at the time of the final remedy selection. DTSC’s proposal moves this timeframe up to the “earliest time the Department is able to make a reasonable determination of the amount of financial assurance required.”[4] It also requires DTSC to make such a determination “before corrective action is initiated by a facility.”[5] The proposal also requires a 25% advance payment of the determined corrective action cost.  Applicability of DTSC’s proposed corrective action financial assurance changes is unclear. The corrective action provision appears in Part 264, suggesting it is limited solely to permitted TSDFs. However, DTSC often requires facilities subject to California’s “tiered permitting” program (i.e., permits required under California law but not federal law) as well facilities performing work under consent agreements to conduct corrective action. DTSC has relied on its Part 264 language when requiring such corrective action.  The proposed revisions suggest DTSC may broadly apply the corrective action financial assurance requirement as DTSC’s proposal requires the 25% advance cost payment when corrective action is required under a “permit or order.”[6]

Among DTSC’s proposed changes to the closure and post‑closure financial assurance requirements are revisions to the financial test and corporate guarantee that (i) double the tangible net worth requirement from $10 million to $20 million; (ii) require establishment of a trust fund equal to 20% of the current closure and post‑closure cost estimate that is funded over time with an annual payment equal to 2% of the current cost estimate; and (iii) require submittal of the owner or operator’s financial statements (which are in addition to the already required independent certified public accountant’s report of such financial statements). DTSC also proposes to revise the post‑closure cost estimate to cover a mandatory 30 year timeframe, and to allow DTSC to reset the 30 year time period each time a post-closure permit is re-issued. Finally, DTSC proposes changes to the mandatory wording of various instruments used to demonstrate financial assurance.

Proposed Hazardous Waste Permitting Revisions

In an effort to ensure “greater transparency and consistency” in hazardous waste permit decision‑making, DTSC is proposing a “violations scoring procedure” (VSP) to review the compliance history of permitted TSDFs anytime a permit is modified or renewed.[7] As proposed, facilities operating exclusively under a closure or post-closure permit would not be subject to the VSP process. The VSP process would also not apply to facilities operating under California’s tiered permitting program.

As drafted, the VSP calculation includes all Class I permit violations found during compliance inspections over a rolling ten‑year period. Each Class I violation is proposed to be evaluated for the potential to harm public health and safety or the environment and the extent of deviation from hazardous waste management requirements. Both the potential harm and extent of deviation are categorized as major, moderate or minor, and assigned points depending on the categorization. The initial score is proposed to be adjusted upward to reflect any repeat violations. Once adopted, DTSC proposes to provide the TSDF a VSP inspection score following each inspection. As proposed, a TSDF has 30 days to challenge the score; DTSC’s decision on the challenge is final and is not subject to additional administrative dispute resolution. There is no challenge procedure for VSP scores for inspections occurring in the time period preceding adoption of the regulation.

TSDFs will be assigned a compliance tier of acceptable, conditionally acceptable or unacceptable based on their VSP score. DTSC proposes to impose differing permit conditions depending upon the VSP score. As proposed, TSDFs with a conditionally acceptable score will be subject to an independent third party compliance audit, will be required to submit the audit results to DTSC and prepare a compliance implementation plan for DTSC approval. If DTSC determines that TSDFs with an unacceptable VSP score (i) pose an imminent and substantial endangerment to the public, (ii) have an ongoing pattern of noncompliance or (iii) are unable or unwilling to comply with applicable laws, DTSC proposes to suspend or revoke the TSDF permit. Alternatively, DTSC proposes to take one or more of the following actions: (i) require an independent third party audit; (ii) implement facility improvements (e.g., equipment repair or replacement); (iii) cease hazardous waste management unit operations; (iv) conduct public meetings regarding the facility’s compliance status; (v) increase or expand monitoring, recordkeeping and/or reporting; (vi) conduct enhanced training; (vii) require a 25% increase in financial assurance for closure or corrective action; and/or (viii) implement other requirements to ensure compliance. DTSC proposes to allow for issuance of a permit for a TSDF with an unacceptable VSP scores provided the TSDF does not pose a threat to public health, safety or the environment and the issued permit (i) does not exceed 5 years; (ii) contains enhanced compliance provisions including an annual independent third party compliance audit; and (iii) includes mitigation measures for any potential harm associated with the noncompliance.

Companies that may be impacted by DTSC’s proposed substantial expansion of California’s hazardous waste management program should consider submitting comments to DTSC by the November 6, 2017 deadline.

[1] DTSC Reference No. R‑2016‑03

[2] 8 C.C.R. § 5192(p)

[3] 49 C.F.R. § 172.704

[4] Proposed 22 C.C.R. § 66264.101(b)

[5] Id.

[6] Proposed 22 C.C.R. § 66264.101(c).

[7] Initial Statement of Reasons for R-2016-03 at 5, 9.