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Towards Achieving Clean Water Goals: An Evaluation of California's Mandatory Minimum Penalty Enforcement Program

  • Author(s): Vasquez, Victor Rigor
  • Advisor(s): Stenstrom, Michael K
  • et al.
Abstract

An effective environmental regulatory policy requires an effective monitoring and enforcement strategy implemented by the regulatory agency. To achieve effective deterrence to prevent or reduce violations of environmental regulations, enforcement actions must have severity, and violation costs must be greater than the economic benefits realized by violators. Effective deterrence also requires certainty that violations will be detected and sanctioned and that enforcement actions will be taken swiftly. Environmental monetary penalties may take into consideration factors such as the degree of environmental damage, frequency of violations, and the culpability of the violator. Mandatory minimum penalties (MMPs) are a form of monetary penalties that require regulatory agencies to issue a set fixed dollar amount per violation, often through expedited administrative procedures; thus increasing certainty and celerity of enforcement actions but at the same time removing discretion from regulatory agencies to tailor the penalty amount to the violation. In California starting in 2000, an MMP of $3,000 has been issued to violating facilities for each violation of effluent limitations contained in National Pollutant Discharge Elimination System (NPDES) permits issued pursuant to the 1972 US Clean Water Act. Three investigations were conducted to evaluate California's MMP enforcement program to quantitatively estimate its impact on the number of NPDES effluent limitation violations and on improvements in water quality. Data from the 2000-2011 NPDES and MMP enforcement program record were analyzed using linear regression models. Results suggest that the MMP enforcement program has resulted in modest decreases in the number of violations across the state and in measurable improvements in effluent quality discharged to San Francisco Bay and the Sacramento-San Joaquin Delta; however improvements in receiving water quality may not be observable due to other pollution inputs and fate and transport processes. The results suggest that mandatory penalties are effective in promoting compliance and achieving reductions in pollution and that the effects are due to both facility-specific effects as well as enhancement of the regulatory agency's enforcement reputation. However, because violations continue despite the MMP enforcement program, the results may also suggest that the MMP enforcement program could be optimized to achieve larger effects.

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