DEPARTMENT OF ENVIRONMENTAL PROTECTION
BUREAU OF OIL AND GAS MANAGEMENT
DOCUMENT NUMBER: 550-4180-001

TITLE: Civil Penalty Asrssments

in the Oil and Gas Management Program

EFFECTIVE DATE: lanvary 12'2002

Solid
seq)
1' et-seq )
Dam Saiety and Encroachments Act (32 P S' Section 693
510-l et seq')
The Administrative Code (P L l77,No l75)(71 PS Secion
288' 289'291'
287
261a'
106'
t05'
25 Pa. Code Chapters 78,79,91'92'95' t02'
'
299
293'
^nd
in calculating appropriate
In assessing civil penalties in unilateral penalty actions, and
will
ManasementProsam
oil and Gas
il;"h,i;;i'i""g;t';a ""nl"-"nt ' DEP'sherein
of
when pusuing a settlement
iollow tbe Poli;ies stated and referenced
action'
complaints for violations or a penalty

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poLICY:
' ""'.-'

l0l et seq )
The Oil and Gas Act (P'L l 140, No' 223) (58 P S -section^60l
(58
P S Section
2l4)
Coal and Gas Resource Coordination Act (P'L' 1069' No
501.1 et seq )
Section 401'1 etseq)
and
Gas conservation Law (P'L 825'No 359)(58P'S
Oil
(15 P S Section69l l et seq')
The Clean Strearns Law (P L' 1987, No 394) qT)
(15 P S Section 6018'l0l et
Waste Manag€ment Acr (P L 380'No

V.
1.
1

AUTIIORITY:

guidance to DEP'S Oil and Cas
PURPOSET The purpose ofthis document is to provide procedural
civil penalty amounts to seek in settlements' or to
Murrlg";"nt ttun in
to the
"alculating
ur.".."in p"rrutty u"tions for viollationi' and to provide advisory information
regulated industrY.

APPLICABILITY:

DISCLAIMER:

public
The policies herein provide guidance to DEP personnel and the
Oil and
DEP's
by
imposed
co.r"emiog p",tolty u'"essmJnts negotiated with or
Gas Management Proglam

are intended to
The policies and procedures outlined in this guidance document
procedures will
supplenent existhg requirements' Nothing in the policies ol
alTect regulatory rcquirements

There
The policies and procedures herein are not an adjudication or a regulation'
weight or
is no int"ot ott the pttt ofthe Department to give these rules that
DEP will
which
within
fiamework'
deference. This document establishes the
the
disffetion to
exercise its administrative discretion in the future DEP reserves
deviate fiom this policy statement ifcircumstances warrant'

PAGE LENGTH:

II

LOCATION: Volume I l, Tab l0

 Commonwealth of penmylva ,
Departmetrt of Envirolmentai protectioa
Oil and Gas ManagerneDt program

Civil Penalty Assessments in the eil aa{

e6

l4anagement program

DEP Technical Guidance Document
ID No. 550_41g0_001

Topic

V.
1.
1

No.

I. INTRODUCTION

1

II. PENALTY CALCULATION

2

III. IMPACT OF VIOLATIONS

3

A.
B.
C.

Violation of Oil and cas Act That Endangered
Health or Safef of persons

3

Damage from Violations Alfecting
Waters ofthe Commonwealth

4

Damage From Violations Not Affecting
Waters ofthe Comrnonwealth

5

OF VIOLATOR,S ACT]ONS

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ru. W]LLFULNESS

V. COSTS TO THE COMMONWEAL.TH

VI. SAVINGS TO TIIE VIOLATOR

6
7
7

VII. V]OLATOR'S HISTORY

V

8

. COOPERATION

8

lX. DOCUMENTATION

Civil Penalty Calculation Workshea

550-4180-001

/ Iantary

72,2002

/pagei

9

l0

 Management Program
Civil Penalty Assessrnents in the Oil and Gas
INTRODUCTION
Pumose

iil:*;;;;;;;",".
;;;'i;iJil;;;;ll"*.'i["i

:i:ii:i-";i'.';;i;;.". oii".Jb*
*".-i.
;iil;iJil"il;;"t
Statutorv Authorities

V.
1.
1

lo assist regional slaff in applying reasonable
The oolicies in this document are inlended
:-.^---!-+r^-c^rrhFr,,'i^,,"locrorstobeconsideredinassessingcivil penalties While
in p"n'Itu assessmenl a particular case mav encompass
what would be arived at by
"o*ist"o"v
faclors that warrant a penatty assessment different ft;m
'nidne
penalry assessrnent guidelines are a statement
it. il'"""
"i"il
irogram sraffmav.deviate riom this
r'a"""eement
u"*g t'io the Depanment's adminisrati!e discretion'

administe$ many laws that
Pennsylvania's Department ofEnvircnmental Protection
p"ri ies for violations. The Oil and Gas Management Program would seek
""rir"ir" rnunfu
the Oil and Gas Act (58 P S Section 601 506) and the Clean
a penalty
"".rlti*
P.a. section 691.605). occasionally' the Program may assess
(35
P S'
Act
.itft ti-ilar provisions' such as the Solid Waste Management
uoi"r. fu*
-Ort.eOS;
o. ttebam Safety and Encroachments Act (35 P'S' Section 693 21)'
i""tioo
Conservation Law
Also, on occasion the Departnent may need to invoke the Oil and Gas
p s s""Lion 401 et siq. ) and the Coal and Gas Resor.rce Coordination Act
i
iig p.i. s..tion sor .t seq ), or other environrnental laws ofthe commonwedth-

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"i" *a(;
il;;;*
ir

penalty' tlte Deparhnent must
As directed by the laws cited above, when assessing a civil
consider factors such as (but not limited to):

.
.
.
.
.

Danger to public health and welfare.
Oaniage to ail water,land or other natural rcsources ofthe CommonwealthWillfulness or culpability of the violator'
Costs incurred by the Conmonwealth as a result ofthe violation'
Savings resultant to the violator.

in the
This oolicv considers danger to public health and safety, and damage to resowces
oftlre offender
e"n;ilul"goty ofittpaci ofthe violation The good faith or cooperation
factors'
as
relevant
in ["po"* io tft" uiolation and the violation history arc also evaluated

An assessed penalty may never exc€ed the statutory rnaximum'

Stipulated Penalties in Consent Orders

Consent
This procedure need not be used to calculate stipulated penalties for purposes ofa
policy
penalties
This
O.d"i -d ,lgr""-".tt, or an operating permit conlaining stipulated
order'
Jdresses vio-lations of law; stipulated penalties apply to violations ofa consent

550-4180-001 / January 12,2002 /Page

I

 Cotrse[t Assessment of Civil perlaltv (settlemeht)
This polic) is used to calculate a nenall)
ro be assessed unjlaterally by the Department.
aRer achievins compliance. the viotaroiand
,h.
l ." I
Assessment ofCivil penalty {seftlement)a 1e..". urnountrnuy U" ipp.opnlur". tU,
sefllement arnount r.roujd reliect the value
of avoiding litigalion. bur nor at the cost of
continuing environmental ham. while
'"i"i a significant
fraction of the amount calculated for a unilat".uf
p"nAty *r"""_"oi
assessment will be considered on its panicutars.
"on""r,,
fhe Oi ana Gas t luiii"il",rt
p.og*has not esrablished a specific poricy on what
is
lbr a penalty
m a consent assessment compared to the penalty"
calculated for a unilateJfusessment.

lf

fi;;il"#;?

""*r,

;";;;;;;

II.

PENALTYCALCULATION
Relationship of Factors

V.
1.
1

aconse;;;;;il J.fi,Js;il
;;;f;;e

The bas€ arnounl ofa penalty calculation is .lssessed
according to the impact ofthe offense,
as determined by the resultant harm or risk of hurrn
to
*"n:.13"n1. The willtulaess or culpability ofrhe offend". i, ifr"i
to a"t"rrn;n"
an additional penalty. The direct costs ro the Commonwealth
for ""'J*i"a _"p"^",
*elt as any savings realized by the viotaror as u."ruiioitf," p"nair"a
oenavtor, are added to arrive at a subtotal penalty amount. The
violator,s histoD.is also
considered, as a potential punitive additional am;unt, a percentage
ff,"
good faith and cooperarion exhibited by the violato.
"i,fr"
in ciean_rrp,-abatem"nl
r"so*tion
-a
is rated as a mitigaling factor- A favorable coop".utton .uting
;i;.""1.,[g" a"Ou"tlon
lrom the previous subtoral resuhing in tie final penalty amorinr.

p.opl",;.;;..d;;;

inv;i;;;;;,

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Il-L..dud.l:T

,rli."f.

J;

Petraltv Formula

Tle full penaity calculation

Penalty

formuJa is:

Amount: Impact $ + Willfulness $ + Commonwealth,s Costs
+ Violator's Savings + Viol History $ _ Cooperation
$.

Continuinq Violations

Penalties for the duration ofa contiruing ,r iolation should apply
only to dischargesoamage. or condttons observed lo be contbuous orer time: for example.
a monitored
effluent discharge from a wastewater treatment plant, or an unplugg"i uUaoJoiea
rv"1.
Singular incidents or conditions that are not yet iorrected, but not-intinually
caustng
pollution or damage (e.g., erosion and sedimentation controls), should
be coisiderea single
evenls, or possibly multiple events, but should not have a daily penalty
assessed for
continuing in violation.

5504180-001 I Jar uaxy 12,2OO2 / paee 2

 Worksheet
A penalty assessment wortsheet is shown

III.

as

Appendix

I

.

IMPACT OF VIOLATIONS
Base penalty amounts are determined by evaluating the impact of violations.

of Oil ard Gas Act that Endangered Health or Safety of per.sons.

V.
1.
1

A. Violation

1. Severe: Base penalty = $5,000 to $25,000 if any of the following conditions
occurred:

.

Physical injury, illness or death of a person.

.

Major danage to private or public propedy that reflects an endangerment
the safety of others.

of

.

Widespread evacuation or evacuation for a long period oftime.

.

Loss of a source of a public water supply due to the explosive nature of gas

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contamination.

2. Significant:

Base penalry = $1,000 to $5,000

ifany ofthe following conditions

occurred:

.

.

Minor physical injury ofindividuals.

Verifiable damage to public or pdvate property that reflects an endalgerment
the safety ofothels.

.

Short term evacuation or evacuation ovel a limited area.

.

Modemte. but significanr public nuisance.

.

of

Intemrption or diminution ofa public or private water supply that is sufficient to
discontinue use ofthe water supply due to the explosive nahfe ofgas
contamination.

3. Moderate to low:
produced.

Base

penalty:

up to $1,000 ifeffects other than those above are

550-4180-001 / January 12,2002 I Page 3

 B. Damage fi'om Violations Affecting Waters of ihe Commonw€alth
(Clean Strearns I-aw)
The severity of violations impacting water quality, or with the potential for such
impacts, is rated according to protected uses ofthe steam or water body as described
in 25 Pa. Code Chapter 93.

l.

Special Protection

-

Waters designated Exceptional Value or High Quality.

V.
1.
1

2. High Use - Public water supply sources and./or extensive use as pdvate water
supplies, game fisheries not identified as sPecial prctection, and
wate$ of considerable reqeational or @onomic value.

3. Moderate Use - Waters with significant use as private wat€r supplies, non-game
fisheries not identified as special protection waters, and waters
of considerable recreational or economic value.
4. Low Use - No significant water supply use exists, no knou.n rccreational or
economic use exists, or waters polluted by other sources.

Resource damage to waters of the Commonwealth is rated in one of five categoriesl

Severe - Extensive damage to the resource or extensive impairment of one or

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l.

more water [ses-

2. Signifrcant - Considerable damage to the resource or considemble impairment of
one or more water uses.

3. Moderate - Minor darnage to the resouce or impairment ofone or more water
uses to the extent that ihere is some inconveni€nce to water users.

4. Low - Minimal damage to the resouce and minimal inconvenience to water
users.

5. Negligible - Violations that did not result in any detectable damage or
inconvmience, but are considered because of the preventative intent

ofthe act.

From the water's designated use ard the rating ofresource damage, assess a penalty
for the impact of the violation up to the maximum amounts shown in Table 1 .

550-4180-001 / Jsrl;uary 12,2002 /Page 4

 Table

l.

PenaltJr Amounls for Impact of Violations rmder Cleao Streams

Damaqe

Severe

Special

$

Significant
Moderate
Low
Negligible

10,000
8,000
6,000
4,000
2,000

Use
6,000
4,000
2,000
1,000
500

Moderate
$

Low U$e
$ 4,000

2,000
1,000

500

2s0

V.
1.
1

C.

Use
Use
$ 4.000
6,000
4,000
2,000
1,000

Protection Hig[

Law

Damage from violations NOT allecting waten ofthe Commonwealth
(Oil and Gas Act, Solid Waste Management Act, Dam Safety
and E;;roactrment

acty

The impact of violations of laws other than the Clean Streams
Law that caused or
risked resource damage are rated according the following descriptions:
1. Severe

.

Destuction. or contaminalion ofcrilical habitat ofthreatened or
endangered
species.

.

Destruction of significant areas or acreage of state parks, state
forcsts, state

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game laods.

.

Major impact on land use (agdculture, rccreation, etc.).

.

Damage to resources rcquiring long-term or artilicial recoverv-

2. Significant

.

.

Limited impact on wildlife or significant habitat.

Limited impact on arcas or acreage ofstate parks, state forcsts,
state game

lands.

.

Significant but limited or short term impact on land use.

.

Damage to rcsources requiring a short_term recovery.

3. Moderate

10

Low

The rating for violations where effects other than
those described above arc
produced.

550-4180-001 / January 12,2002 / page 5

 4. De minimus
A violation ofthe law existed, but rcsulted in no damage or dsk of adve$e effect
on natural resources or property or others.

The base penalty amount in considention of damage to resoucas would be determined
by reference to Table 2.

Oil & Gas Act

Impact

Severe
$5,000 - $25,000
Sigoificant $1,000 - $5,000
Moderate/Low
De

Minimus

$500 - $1,000
Up to $500
$1,000

Daily Maximum
for Continuing

Applicable Law
Solid Waste
ManageDcnt Act
$5,000 - $25,000
$1,000 - $5,000
$500 - $1,000
Up to $500
$25,000

WILLFIJLNESS OF VIOLATOR'S ACTIONS

-

Dam Safety &
Encroachment Act
$2,000 - $10,000
$500 - $2,000
$250 - $s00
Up to $250
$500

Regardless of the law under which a penalty is assessed, consideration ofthe violato''s
wiifulness or degree of culpability in committing the violations exerts a prcfound

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Iv.

l4plgljl8ggllgglgge

V.
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1

Table 2. Bas€ Penalty Amornts for

influence in determining the total amount of a penalty

Willfulrress is rated in one offour degrees: deliberate, recHess' negligent' or accidental'

.

Deliberate

.

Reckless

-

-

An intentional action or intentional lack of action; a deliberate
predetermined action with prior knowledge that the action constituted
a violation of law, regulations' permit conditions, or a delib€rate
atlempt to circumvent or avoid compliance'

A conscious disregard of consequences, proceeding with risk in mind; a
violation resulting from the disregard of an obvious risk' the existence'
natwe, and possible consequences of which are known, or ofwhich prior
r.taming had been given

.

.

Negtigent - Failue
lack of
correct
canied

Accidental

to prevent the occurence of a violation due to indifference or
diligence; a violation resulting ftom the failue to rccognize'
or prevent a condition which the violator should have recognized
a certain degree of risk.

resulting from factors beyond the control of the violator
and, therefore, could not reasonably have been prcvented'

- A violation

550-4180-001 / January 12,2O02 /Page 6

 To determine the a.Inourf ofpenalty to assess for the violator's willfulness, refer to Table 3.

Table 3. Pemlty Amounts for

Degiee

of

Oil & Gas

Act

Willfr

ness

Applicable Law

Strerms Solid Waste
Law
Management Act

Clean

Willfulness

Deliberate

$4,000 - $25,000 $2,000 - $10,000 $4,000 - $25,000
$2,000 - $4,000
$500 $2,000 - $4,000
$100 - $2,000
$100 - $500
$100 - $2,000
No[e
NoIIe
None
Daily Maximum $1,000
$10,000
$25,000
for Continuing

Reckless
Negligent
Accidental

COSTS TO THE COMMOITWEALTH

V.
1.
1

V.

$2,000

Dam Safety &
Encroachment Act
$2,000 - $10,000
$500 - $2,000
$100 - $500
None
$500

A penalty assessment may include consideration of costs incurred by the Commonwealth
as a rcsult of the violation. In the penalty ca.lculalion formula, cosls arc added to the penalty
subtotal that results from application of the willfulness and cooperation factors.

All

ofthe incident or cas€ may be included,

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costs related to the investigation and abatement
such as costs of:

.
.
.
.
.
.
.

Emergency response.
Abatement, remedial, and preventive actions take! by Commonwealth agencies.
Salaries and benefits.
Tmvel expenses for staff.
Legal staff costs.
Cost ofcontracts awarded to Conrnonwealth subcontractors.
Sampling and laboratory analyses.

Costs incured by personnel ftom all Commonwealth agencies involved should be
included.

Cost estimates for the Commonwealth's efforts necessary for abatement or for a long_tem
environmental restoration must also b€ consider€d. Estimates for the cost of restoration or
abatement may be based on a competitive procurement prccess when feasible.

\4.

SAVINGS TO THE VIOLATOR

A penalty assessment may include an amount equal to the savings or economic benefit
realizpd by the violator as a rcsult of the violation, had it not been p€nalized. As with costs
to the Commonwealth, this amount for violator's savings is added to the penalty subtotal
resulting from application of the willfulness and coop€ration factors.

550-4180-001 / Iaruary 12,2002 / Page 7

 The economic benefit resulting fiom Ailue to comply includes costs avoided and
expenditures delayed. This amount is determined by estimating the costs of actions that
should have been taken by the violator; the omission ofwhich directly or indirectly caused
the incident to occur.

EI@plq A severe

}.[

VIOLATOR'S HISTORY

V.
1.
1

erosion and rdimentation prcblem results from an operator's failure to
implement surface runoffcontrol measues and failue to restore the well site as called for
in tbe erosion and sedimentation plan. Calculate the savings resulting ftom the failure to
re-grade, seed, and mulch the site, and to install and maintain necessary control features.

A violator's recent past record of similar incidents is another punitive factor to consider in
penalty assessments. Ifthe offender has a record ofrecent similar incidents at any other
sites, add a percentage ofthe subtotal ofall punitive and cost factors described above
before applying any discount for cooperation. The add-on for the violator's history may
not exceed 10olo ofthe subtotal.

VI . COOPERATION

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The Departnent may consider how promptly a violation is corrected as an indication of
good faith on the part ofthe offender. Good faith can also be manifested by the violator's
prompt self-reporting ofnon-compliance. In order to recognize and reward prompt proactive response to spills or pollution incidents, a discount is offered for above-average
cooperation. A deduction will be given based on the violator's attempt to attain
compliance after the violation became known.
However, when self-repofiing ofthe violation is required by law, or where the violator
demonstrates a lack ofgood faith in taking corrective actiorL the Deparhnent will not
consider a reduction in the proposed penalty assessment. Likewise, there will be no good
faith adjustment for willful or rcckless violations.

Ratins Cooperation

Cooperation is included in penalty calculation as a percentage discount for a favorable
rating. Ratings and percentage deductions are: Excellent, 20%; Good, l0olo: and Poor, 0.

Excellent Cooperation

Excellent cooperatiol occus when ihe violator quickly admits rcsponsibility for the
incident, cooperates fully during the investigation, and promptly cleans up or conects the
situation to the grcatest extent possible. The violator would prompdy notify the Departnent
and immediately correct the violation after discovering it. The civil penalty assessment may
be adjusted based on the violator's demonstration ofgood faith in complying with statutory
or regulatory rcquirements, Good faith can also be manifested by the violator's prompt
self-reporting ofnoncompliance. Other proactive measures by the violator may also be

550-4180-001 / Ian'nfty

l2,2ou /Paee8

 considered, such as providing laboratory facilities or bringing experts from other locations
to assist. These actions must be voluntary and taken on the violator's own initiative.

Good Cooperation

Poor Cooperatiou

V.
1.
1

Good coopemtion occurs when the violator does what he has to in the investigation and/or
cleanup ofthe incident. The violator immediately corrects the violation after being notified
ofit by DEP. One difference between excellent and good cooperation is the degree ofthe
violator's proactive response. Good cooperation describes the violator promptly carrying
out corective action after being infomed of what to do by the Depaxtment.

Poor coopemtion occurs when the violator is reluctant to admil responsibilif, fails to
promptly clean up a spill or correct a violation situatioi, or fails to coopemte in a
subsequent investigation. Coopention is rated ' poor" if a violator must be persuaded or
ordered to take appropiate action, or where the violator fails to pusue adequate corrective
or remedial actions a.fter the Deparhnent identifies deficiencies in previous efforts-

DOCIJMENTATION

Oil and Gas Managernent staff involved in calculating penalty assessments will keep
records and evidence to document p€nalty ratings and the ass€ssment process. These
records will include, as applicable: inspection reports, complaint investigation reports,
photogm.phs, labomtory rcports, notices of violation, notes and memos summarizing
conferences with the violator and compliance assista.nce offers extended by DEP, and

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IX

penalry calculation worksheets.

Appendix

1 shows a penalty calculation wo*sheet to be used by Oil and Gas Management
personnel in documenting the application offris policy for penalty assessment.

550-4180-001 / January 12,2002 I Page 9

 COMMOI WEALTH OF PENNSYLVANIA

DEPART ENT OF ENVIRON ENTAL PRO]ECNON
OILAND GAS ANAGE ENT PROGRA

Civil Penalty Calculation Worksheet
(for DEP use only)
Desc.iplion of violations and applicable laws.

ubtic

Severe

dions

Trc:

Eif

lD:

TYpe

EnflD:

Daie:

Tvoe:

En{lD:

Date:

Date:

Significant Moderate/Low None

V.
1.
1

Pior Reraied Enfo@ment

Water Oualiw Related

lol W.Q. rel.ted
Siqniflcant Moderate Low

Ir

Costs

ngs

,ry

Reckless

Negligible

SpecialPrctedion

Damage: Severe

'lsCOUnt

Significant

sanpbs g

Photos

$

Mileage $

rcurs $

Notes:

add

Sublract

Appendix

l.

550-4180-001 / Ianuaty 12,2002 /Page

l0

Moderale

Moderate

Neglag€nt Accidental

o/o
Amount for violatols history,
of
the sum of amounts in the frsl fve rows.

,nE Above

High

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Deliberate

Use:

Low

Negligible

 CO

ONWEALTH OF PENNSYLVANIA
DEPARTMENT OF ENVIRONIIENTAL PROIECTION
OIL AND GAS IIIANAGEIUENT PROGRAII/I

Civil Penalty Calculation Worksheet
ReeponsroE pany

(voralo.)

tD or

oco

d

Doscdption ofviolal on. end .pplrcabl€ lew!.

Pior Reraied Enlorcefr€nt

Loet,on

]'"-'

Act ons

Type:

EnftD:

Type:

EntlD:

Type:

Enf

lD:

Dare:

Date:

lnspeclion
Datesl

Penal
$

c alculation. Factors
EndangerlngPublic
Saletv or Health

seuerc

V.
1.
1

(for DEP use only)

Signilic€nl [4oderate/Low

None

Damage to Natural Resources

PE
N_
SO
UR
CE

WaterOuality Rotated

Uae:

Special

Protec{ion

Damage: Severc

Willfulnasa Deliberate Recktess

^
$

commonweatth

cosl(-

samples

t*rt t, *,t.*r"

$

Prolos $

Notesj

^

Cooperction

add

a/a
Amount lor violator's hislory.
ol
the Eum ofamounls i,] the first tive rows

^"^t.
Discount Subtract

% ofsubtotat.

Ralings and plocadule

Total

Signiticanl

tvoderate

l\,4oderate

Negtigent Accidental

Vlolator'a Savings

Viotat.,/s Historu
,

High

rcv swed / apprcved by:

Appendix 1. 550-4180-001 / Jan'rary 12,2002 I Page 10

ohff

$

Low

Negligible