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EPA doubles down on risk management efforts after disasters

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The West, Texas, fertilizer disaster that killed 15 people and other catastrophic events have culminated in changes to the U.S. Environmental Protection Agency’s Risk Management Program designed to prevent or mitigate the risks of these incidents. 

The April 2013 explosion at the West Fertilizer Co. killed 12 emergency responders and three civilians and injured more than 260 others, according to the U.S. Chemical Safety and Hazard Investigation Board. While numerous chemical plants are operated safely, more than 1,500 accidents were reported by Risk Management Program facilities in the last 10 years, according to the EPA. 

The disaster prompted then-President Barack Obama to issue an executive order in August 2013 to several agencies, including the EPA, to strengthen the Risk Management Program to improve safety and security at these facilities. The program amendments were published in the Federal Register on Jan. 13 and were scheduled to take effect March 14, but President Donald Trump's administration issued a memo temporarily delaying the effective date of the amendments and other EPA regulations until March 21.  

The amendments, which apply to Program 2 or 3 facilities designated as having a higher risk of accidental releases, will mandate certain actions that many facilities may have already been engaged in on a voluntary basis, experts say. For example, facilities will now be required to conduct a root cause analysis as part of an incident investigation of a catastrophic release or a near miss event that could have resulted in a catastrophic release, according to the amendments. 

“I think most people already would do that because nobody, no industry, no facility wants to have this type of tragic incident,” said Robin Thomerson, Lexington, Kentucky-based of counsel for Dinsmore & Shohl L.L.P. 

Facilities will also be required to hire a third-party auditor or a team led by a third-party auditor to perform a compliance audit after a reportable incident — a revision of the proposed rule that would have required a third-party auditor to completely conduct the audit. Prior to the final rule, facilities had to do compliance audits and incident reports, but those could be led by an internal staffer most familiar with the facility and internal processes. 

In addition, regulated entities will be required to coordinate with local emergency responders at least annually on an emergency response plan and to ensure that responders are aware of the risks, quantities of the regulated substances at their facilities and their ability to respond to accidental releases. This is in direct response to the West disaster because the emergency responders were unaware of the ammonia nitrate risks present at the facility and attempted to put out the fire rather than focusing on evacuations, experts said. 

“It’s widely agreed that one of the biggest issues with West, Texas, was the lack of coordination or the lack of knowledge of the first responders when they were responding to the explosion,” said Brittany Barrientos, a Kansas City, Missouri-based partner with Stinson Leonard Street L.L.P. “That’s something that the risk management regulations have always tried to address, and that’s something that these revisions in particular seem to have a really big focus on: coordination with local authorities.” 

Facilities will also be required to inform the public of their rights to certain information about the hazardous substances at their facilities and how to request the information, but the EPA backed off of provisions in the proposed rule that would have required this information to be published on companies’ websites because of security concerns.

“Sadly, it’s a terrorist issue,” said Todd Kantorczyk, a partner at Manko, Gold, Katcher & Fox L.L.P. in Bala Cynwyd, Pennsylvania “You can imagine a situation where you’re disclosing all this information about off-site consequences of an incident at your facility and that your facility as a result becomes a target.”

However, the amendments face an uncertain future under the nominated EPA administrator, Scott Pruitt, who alongside 10 other state attorneys objected to the potential terrorism risk in a July 2016 letter. While the amendments cannot be withdrawn by revoking Mr. Obama’s executive order, the agency could engage in a new rule-making to revise or eliminate the amendments, or Congress could invoke the Congressional Review Act.

“We don’t know yet how the rule is going to be treated by the new administration, but I think we’re advising companies that they should be educating themselves about the new regulations and determining how they’re going to be affected by the changes just so that they are ready and they know what needs to be done in the event that it goes into effect,” said Megan McLean, St. Louis-based associate with Husch Blackwell L.L.P.