Audit, Compliance and Risk Blog

On May 12, 2022, the US Department of Justice (DOJ) published an interim final rule that revokes a Trump-era prohibition against its attorneys’ use of payments to third parties, including via “supplemental environmental projects (SEPs)”, in settlements with violators of federal environmental laws. (I discussed Trump Administration policies several times, most recently HERE). In these cases, DOJ acts as the attorney for the agencies, such as the Environmental Protection Agency (EPA), that enforce laws and regulations allegedly violated. This rule change would codify policy changes presented in a memorandum from Attorney General Merrick Garland to US attorneys. This change is designed to restore flexibility to DOJ’s US attorneys to trade penalty dollars for more rapid commitments by wrongdoers to undertake actions to offset harms caused by their violations.

As public and occupational health agencies around the world continuously reevaluating their responses to the developing COVID-19 pandemic, California has again weighed in on the side of continuing formal controls. Effective May 5, 2022, California has revised and extended its COVID-19 Prevention Emergency Temporary Standard (ETS) until January 1, 2023. (I wrote about the most recent previous iteration adopted in February HERE). The ETS is presented as 5 rules, which are administered by California’s Division of Occupational Safety and Health (DOSH, but universally called Cal/OSHA). The remainder of this note summarizes these revised standards, which appear in Title 8 of the California Code of Regulations (CCR):

On May 4, 2022, the US Environmental Protection Agency (EPA) published notice of a proposed consent decree in litigation brought by the environmental group Center for Biological Diversity (CBD). EPA proposes to issue a decision responding to a petition filed by CBD in 2014, about whether to list discarded polyvinyl chloride (PVC) as hazardous waste under the Resource Conservation and Recovery Act (RCRA). CBD filed the suit early in 2021, after EPA had taken no action on its petition for seven years, claiming that the agency’s inaction violated a duty to act. EPA is now ready to commit to issue a proposed decision no later than January 20, 2023, and a final decision by April 12, 2024.

On April 8, 2022, the US federal Occupational Safety and Health Administration (OSHA) established a National Emphasis Program (NEP) to focus enforcement resources on “Outdoor and Indoor Heat-Related Hazards.” The NEP is OSHA’s latest step to manage and reduce heat illness in workplaces. Earlier actions include “Inspection Guidance for Heat-Related Hazards” on September 1, 2021 (I wrote about it HERE), and an “advanced notice of proposed rulemaking (ANPRM)” on these topics issued on October 27, 2021 (which I wrote about HERE). The remainder of this note summarizes the NEP.

The federal Council on Environmental Quality (CEQ) has revised its regulations administering the National Environmental Policy Act (NEPA) of 1969. NEPA requires federal agencies to assess the environmental effects of their proposed actions, and incorporate this information into their decisions. Government-wide guidance is provided by the White House’s CEQ, established by NEPA and appointed by the President. CEQ issues formal regulations that agencies must follow, and guidance documents that provide additional advice. CEQ also reviews agencies’ NEPA implementation programs, and publishes annual national Environmental Quality Reports.

The Environmental Protection Agency (EPA) has proposed to ban a number of longstanding uses of chrysotile asbestos, using expanded authority provided as part of amendments adopted to the Toxic Substances Control Act (TSCA) in 2016. This proposal is EPA’s latest step to apply its expanded authority to review and restrict uses of asbestos, renewing agency efforts from the 1980s that were blocked by litigation.

On March 28, the US Environmental Protection Agency (EPA) proposed regulations requiring “non-transportation-related onshore facilities” to prepare response plans covering possible releases of hazardous substances, and submit those plans to EPA. This proposal implements longstanding but unused EPA authority under the Clean Water Act (CWA). The remainder of this note discusses the proposal.

On March 28, the Biden Administration issued its budget proposal for federal Fiscal Year (FY) 2023 (October 1, 2022 through September 30, 2023). The administration proposes a $11.9 billion budget for the Environmental Protection Agency (EPA), a 29% ($2.6 billion) increase above EPA’s adopted 2022 budget of $9.6 billion – similar to the administration’s FY 2022 proposal of $11.2 billion (which I wrote about HERE), which Congress cut considerably.

The Occupational Safety and Health Administration (OSHA) requires most employers with 10 or more employees at an “establishment” to prepare and maintain records of occupational injuries and illnesses (I&I) as they occur (I&I Logs). OSHA also requires employers to post an annual I&I Summary in each workplace “establishment” by February 1, summarizing that workplace’s I&Is during the previous calendar year. In addition, beginning in 2017 OSHA requires some employers to submit some of this I&I information electronically to the agency. (I wrote about the initial electronic reporting requirements HERE). On March 30 OSHA proposed to update and revise these electronic reporting requirements, which the remainder of this note summarizes.

When must organizations evaluate and disclose how climate change will affect their operations?

The US Securities and Exchange Commission (SEC) administers reporting requirements for companies listed on national securities exchanges (“listed companies” or “public companies”), under federal securities laws including the Securities Act of 1933 and the Securities Exchange Act of 1934. Some of the SEC’s requirements provide detailed specifications, such as financial reporting consistent with Generally Accepted Accounting Practices (GAAP). Others are less quantified, requiring reporting of information that might be “material” to investors’ evaluation of a public company. Over time, SEC has added topics subject to reporting of material information, and some of these generalized requirements have evolved into more specific ones. In the latest example of this evolution, in March 2022 SEC is proposing regulatory requirements for disclosures about “climate-related risks and metrics” by public companies, enhancing and standardizing existing agency guidance (I’ve written about these several times over the years, most recently HERE). The remainder of this note summarizes SEC’s proposal.