Compliance Assurance - Overview and Implementation Solutions

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Compliance Assurance- Overview and
Implementation Solutions

• Air Waste Management Association
• Southern Section Annual Conference
• Callaway Gardens Lodge Spa
• Pine Mountain, Georgia
• August 3rd, 2011

Scott Kirby, Ph.D. Environmental Resources
Management
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What is Compliance Assurance?

• Quantifiable measure of confidence that ALL
  regulatory requirements are being fulfilled and
  appropriately documented.
• Drivers
• Compliance Enforcement Actions
• Civil and Criminal Penalties
• Company Liability
• Difficult to keep track of seemingly perpetual
  expansion of regulatory requirements, revisions
  and deadlines
• Moving Target

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Off-the-Shelf Software

• Numerical-data gathering and reporting (task
  management).
• Task-tracking has been viewed as the only way to
  exert real-time control of the compliance
  process.
• Alerts sent out to task performers before due
  dates, and second tier alerts can invoke the
  chain of command for reinforcement if necessary.
• Intent is to provide real-time feedback to
  management about the completion of tasks, and to
  spread out the task-completion documentation
  workload among the employees who perform the task.

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Issues with Off-the-Shelf Software

• Standardized format
• Difficult to incorporate with company-specific
  policies and procedures
• Requires constant updating as new and revised
  regulations are promulgated, and, as employees
  turnovers occur and
• No option for feedback (Path of Least
  Resistance)
• Development of a check-box mentality.
• Allows for the creation of a parallel universe
  where it appears as if events have been completed
  while the reality may be significantly different.

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Parallel Universe Real World Example

• EPA investigator asked to see records for the
  last two quarters of drain inspections required
  by the benzene waste NESHAP (40 CFR 61) at a
  petroleum refinery.
• After reviewing the neat listing of drains that
  had been signed off on as Inspected, the
  investigator asked to look at the drains and the
  facility staff who performed the initialling was
  unable to locate about one third of the drains.

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Opposite Parallel Universe

• Conversely, the opposite of this is possible,
  where work is done but, for whatever reason (e.g.
  shift change), the electronic documentation in
  task-tracking system is not completed, or the
  inspection form is completed but not properly
  filed so it cannot be located during an agency
  inspection.

Perpendicular Universe
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How Do We Get Back To The Real Universe

• 2 Primary Approaches
• Compliance Auditing
• Periodic Checks

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Compliance Auditing

• Outside third-parties auditors
• Number of requirements assessed is typically
  limited (time and knowledge)
• Audit protocols merely restate the regulations,
  leaving the auditor to rely on his or her
  experience to devise a means of determining
  whether the facility complies.

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Periodic Checks

• Combines the looking-backward approach of a
  compliance audit with the periodicity of a task
  management process.
• Typically does not entail significant work-habit
  changes since checks involve looking back at a
  number of actions at one time rather than
  time-consuming check-offs as each task is
  completed.
• Checks can be assigned to someone other than the
  original task performer, resulting in a
  check-and-balance system, but without the Big
  Brother feel that an audit may have.
• Can easily accommodate multiple levels of
  checking.

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Periodic Checks - Concept

• Checks are developed by taking the time to
  describe very specifically the records and
  documentation to be consulted and exactly how to
  check them against a specific requirement.
• If written effectively, anyone familiar with a
  process or equipment should be able to perform
  the check and not just senior environmental
  personnel.
• Since checks would be repeated on an ongoing
  basis, careful construction of task description
  can result in significantly more efficient
  performance over time
• Allows for employee feed back
• A wise southern gentleman once said There is
  more than one way to skin a cat!
• Promotes a collaborative environmental between
  operations personnel and the red-headed
  step-children (A.K.A. HSE Staff)

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Implementation

• Key stakeholders should define overall goals for
  the process.
• All parties should buy in to process or else the
  your system versus our system labeling will
  undermine what might otherwise be a great idea
• Due to complexity, typically new compliance
  assurance systems are implemented in phases.
  Phases should be planned based on a determination
  of depth of coverage.
• Applicable requirements should be prioritized
  based on risk. Requirements deemed most
  important to the agency (as demonstrated by the
  greatest potential for agency-identified
  violations) should receive greater attention.
• Industry and location-specific compliance issues
  should also be considered when assessing the risk
  associated with requirements.

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Applicability Review

• Applicability review should be transparent.
• Not uncommon for facilities to reinvent the
  applicability determination each time someone new
  assumes responsibility for this function.
• Create test for applicability at the rule level
  and then compile the test and the results of the
  test for each potentially applicable rule.
• Ex. Applies to Chemical Plants
• Further tests can then be compiled for individual
  citations such as does this tank store material
  with a vapor pressure equal to or greater than
  0.5 psia
• This systematic approach to the applicability
  determination makes revisiting it a reading
  exercise instead of a re-creation exercise.
• Not every applicable citation will result in a
  compliance obligation.
• Some citations contain definitions,
  cross-references to other citations, or may be
  merely informational in nature.
• These can be classified as does not contain a
  requirement and can be removed from the list
  requiring tasks or checks.

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Developing Ongoing Checks

• Process begins with looking at information that
  has already been compiled in the form of reports,
  procedures, and forms.
• Matching these to specific regulatory citations
  forms the basis for developing the text of the
  ongoing checks.
• This process reduces excess workload and
  identifies areas of potential improvement.
• In our experience, fewer than 10 of existing
  requirements are covered by what is already in
  writing. Thus, it is important that interviews
  be conducted to gather information on how
  facility complies with most requirements.

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Developing Ongoing Checks

• Who (Personnel)
• What (Task)
• When (Frequency)
• Where (Process and Documentation)
• Why (Regulatory Requirement)
• Where would you look, and what would you compare
  to what criteria to determine compliance?
• Example Each quarter, review the periodic
  tank-seal inspection forms to ensure that each
  tank was inspected within 12 months of its last
  inspection (as indicated from by the date of the
  last form).

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Development Guidelines

• Assigned Responsible Position The person who
  has direct access to the data that will be
  assessed and either is responsible for the task
  to be checked or is a line or staff reviewer of
  that work.
• Frequency Sufficiently often so that if there
  is a significant risk of a deviation, it would
  not run too long without discovery also consider
  whether specific deviations require any sort of
  prompt reporting
• Clarity Checks should not be merely
  cut-and-paste from a regulatory requirement, but
  rather clearly describe the check in language
  that would be familiar to plant operations,
  maintenance, and other non-environmental staff
• Completeness Checks should cover all main
  points in a requirement. Several independent
  checks may be needed for a single requirement.
• References Checks based on a form or a
  procedure should clearly identify not just the
  document, but also the exact portion of it that
  addresses the requirement.

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Functional Role Assignments

• More efficient to assign these roles after the
  checks have been developed.
• Following roles are typically involved
• Unit Operations Foreman
• Responsible for procedures that either contain
  the required operational practices and/or
  reference environmental procedures.
• Unit Process Engineer
• Responsible for equipment design parameters and
  operational data review.
• Unit Environmental Staff Person
• Performs checks that compare operational data
  between multiple sources, such as comparing
  vessel depressurizing reports to flaring logs to
  ensure that the proper records are being
  captured.
• Environmental Staff Rule Experts
• Ensure that the environmental procedures cover
  the rule requirements, such as providing forms
  that request the proper information also,
  responsible for long-term record retention.

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Rolling out the Periodic Check Process

• Does not require special software and often times
  does not require a computer.
• Does not require real-time completion logging but
  instead a cascade of sign-offs at specified times
  is conducted indicating the personnel are
  performing their duties.
• Roll-out can be accomplished by unit, by task
  performing group, or by regulatory area.
• Management of change process is essential to the
  success of a compliance assurance program.
  Regulatory information will need to be
  periodically updated as rules change, management
  goals change, and facility operations change.
• Advantage of a periodic check system versus
  task-tracking software lies in the transparency
  of the MOC process.

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Questions/Comments

• Scott Kirby, Ph.D.
• 820 University Boulevard South Suite 1A
• Mobile, AL 36609
• Email Scott.Kirby_at_erm.com
• Office [phone]
• Mobile [phone]
• THANK YOU!