Commerce Committee

JOINT FAVORABLE REPORT

Bill No.:

SB-269

Title:

AN ACT CONCERNING THE ASSESSMENT OF CIVIL PENALTIES AGAINST SMALL BUSINESSES BY THE DEPARTMENT OF ENERGY AND ENVIRONMENTAL PROTECTION.

Vote Date:

3/27/2018

Vote Action:

Joint Favorable

PH Date:

3/8/2018

File No.:

Disclaimer: The following JOINT FAVORABLE Report is prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and does not represent the intent of the General Assembly or either chamber thereof for any purpose.

SPONSORS OF BILL:

Commerce Committee

REASONS FOR BILL:

This Bill:

● Sets conditions under which the DEEP commissioner must suspend civil penalty imposed on a small business (i.e. one with fewer than 250 employees) for its first regulatory violation

● Commissioner must suspend the penalty if the business, within 30 days after receiving the violation notice:

Takes steps to remedy the condition that triggered the violation within six months of the notice and

Submits written documentation to the commissioner of the steps taken to remedy the condition

● Commissioner must impose the penalty if, within the six months, the business fails to do so, unless he extends the deadline

● Commissioner cannot suspend the penalty for a first-time violation if it:

Was willful or grossly negligent

Harms the human health environment

Is related to a federal law or regulation, including one that is required as a condition for receiving federal funds

Effective Date: October 1, 2018

RESPONSE FROM ADMINISTRATION/AGENCY:

The Department of Energy and Environmental Protection (DEEP) strongly opposes this proposal for three reasons:

● It runs afoul of federal requirements and may risk funding

● It is unnecessary because DEEP already has the discretion necessary to focus enforcement on the most significant environmental, human health and noncompliance problems.

● It presents a perverse incentive that reward violations of environmental standards.

NATURE AND SOURCES OF SUPPORT:

National Federation of Independent Business (NFIB)

● This pro-small business bill will require the Department of Energy & Environmental Protection to allow small businesses to remediate certain first-time regulatory violations without civil penalty if such remediation is done in a timely manner. NFIB/CT believes that this is a reasonable approach that would help provide some much needed balance between the regulators and the regulated community.

Connecticut Business and Industry Association (CBIA) Eric Brown

● The Bill establishes a new policy for the state of Connecticut that small businesses-those that generally don't have the resources to hire specialized attorneys or consultants to ensure every nuance of voluminous and complex environmental regulations are consistently complied with “ to a T”, can count on the state DEEP to be a compliance partner when it comes to unintentional, first-time alleged violations of environmental regulations that present to direct threat to human health or the environment.

Utility Contractors Association OF Connecticut

● Would help the state implement new approaches that foster business confidence while not impairing its strong commitment to protecting public health and the environment. It would adopt a new policy for first-time, unintentional alleged violations of environmental regulations that present no direct threat to health or the environment.

NATURE AND SOURCES OF OPPOSITION:

Council on Environmental Quality - Karl J. Wagener, Executive Director

● The Bill envisions an enforcement agency that will issue what are essentially warning notices for first-time violations. That describes DEEP under current practices where the overwhelming percentage of detected violators receive NOVs and no penalties.

Connecticut Fund for the Environment/Save the Sound

● Requiring that DEEP forgo the imposition of civil penalties will have a negative impact on Connecticut's environment, natural resources, wildlife, and public lands. Given that the employees and leadership at state agencies change over time, the application of the unstructured “free pass” proposed by SB 269 could be applied in a haphazard and unfair manner that unduly benefits particular business entities.

Reported by: Jessica Serrao Asst. Clerk

04/03/2018