August Mack Newsletter | September, 2017

Supplemental Environmental Projects: Turning Lemons into Lemonade
by Ed Callahan

Most people don't become aware of Supplemental Environmental Projects (SEPs) until they have been hit with a costly violation by a State or Federal environmental agency.  A typical example might be that your factory is running at record pace, production is up, costs are down and all of your processes, programs, and procedures seem to be working efficiently. Then suddenly, you receive a letter of violation followed by an enforcement action with monetary penalties that could be upwards of 6 figures.

When faced with a substantial enforcement action, it’s best to contact an attorney and/or an environmental consultant to help you navigate through the process to settlement and reduce the eventual impact. Some of the first steps might include confirming that you were, in fact, in violation of a regulatory requirement. If so, you will need to address the issue at hand and develop a plan to avoid any future occurrences of that particular regulation. We also recommend an environmental audit to close any other potential regulatory gaps. 

Most federal and state actions against businesses or individuals for failure to comply with environmental laws are resolved through settlement agreements. As part of a settlement, an alleged violator may voluntarily agree to undertake an environmentally beneficial project, or SEP, related to the violation in exchange for mitigation of the penalty to be paid.  When properly applied, this mitigation of the penalty can be substantial.  

A Supplement Environmental Project furthers the agency’s goal of protecting and enhancing the public health and the environment.  However, it cannot include the activities a violator must take to return to compliance with the law.  It can however, as a secondary matter, provide the violator with some benefit.

A good example that we have successfully implemented in the past is the development of an approved Environmental Management System (EMS), which by nature is designed to prevent or reduce pollution, raise awareness, and avoid future environmental compliance issues.

Since SEPs are part of an enforcement settlement, they must meet certain legal requirements.  In addition, there are several guidelines and categories that a SEP must meet. To learn more about Supplemental Environmental Projects and Policies, click here to register for our free webinar. 


Ed Callahan is a Business Development Representative for August Mack Environmental, Inc. in the Indianapolis, Indiana office. Ed has over 30 years experience helping business find solutions to environmental, health, & safety issues and specializes in environmental sales, consulting, contracting, and software management systems. Ed can be reached at 317.916.3156 or ecallahan@augustmack.com.


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