Environmental and Energy Law Blog

Friday, September 30, 2016

The TCEQ Was Busy Last Year

The Texas Commission on Environmental Quality (TCEQ) is our state’s version of the federal level Environmental Protection Agency (EPA). It is in charge of regulating more than 571,300 public and private facilities and/or individuals in Texas that affect, or have the potential to significantly affect, the environment.

The TCEQ has the authority to levy penalties of up to $25,000/day/violation in 26 environmental program areas. Each year hundreds of businesses across the state end up tangling with the TCEQ, facing off with regulators who claim they are violating our state’s myriad environmental protection rules.

More often than not, regulated businesses and facilities are able to show that they were actually in the right, or they are able to work with the TCEQ to fix an issue that they did not know existed until it was brought to their attention.

We know exactly how many businesses, individuals, and facilities are investigated and cited by the TCEQ each year, and how all of those enforcement actions play out, because the agency is required to report that information to the legislature. According to the most recent report, in Fiscal Year (FY) 2015, the agency conducted over 109,000 routine investigations and 4,212 complaint investigations throughout the state. These investigations resulted in 18,893 “Notice of Violations” (known as NOVs) being issued in FY 2015. Getting a NOV  alerts the responsible party that something is potentially wrong so that it can be fixed. If things don’t get fixed within a certain amount of time, the responsible parties can receive a proposed fine.

Of the 18,893 NOVs issued last year, only 1,681 were escalated to the point where an administrative order was given out. Most of the enforcement orders issued by the TCEQ were for the water program (818 orders or 47%). 489 (29%) had previous enforcement orders and 333 (20%) had previous violations that were the same or similar.

While these numbers are nothing to sneeze at, it is clear that the vast majority of the NOVs were resolved before an administrative order is handed down. If you have received an NOV, and you want to settle it, you don’t have to hire an attorney to help you, but it is something you should consider. The agency tries to wring as much out of companies facing an NOV as possible. Having an attorney who has experience dealing with the TCEQ on your side can ensure that you don’t give away too much during negotiations.

We have even saved clients money for proposed penalties of less than $10,000 after the attorney fee was added to the reduced penalty. In many cases, proposed penalties can be reduced because a number of NOVs and resultant penalties are based on misinterpretations of the regulations by inexperienced investigators. When these errors are brought to the agency's attention at a higher level, the penalties can be reduced. The administrative order also has to be resolved - generally by filing and completing a compliance plan. If this is not done, another NOV and administrative order results.

In addition, NOVs relate to your business situation the way traffic tickets relate to your auto insurance rates. NOVs can affect your ability to secure environmental permits, they can affect your "Title V" compliance reporting, and they can affect your business insurance rates. NOVs can also show up unfavorably if a customer does a Third Party Audit of your facility. Therefore, it is a good idea to mitigate any NOVs in a timely manner.

If you are one of the brave few who refuse to settle, and choose to fight the TCEQ, hiring an experienced environmental attorney is practically a necessity. The administrative hearing process is a complex, adversarial process that is similar to litigation (and can often lead to litigation). It is unwise to go this route alone, or with an unexperienced attorney. 

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