From: ELWORTH Susan * DEQ

Sent: Fri Mar 26 11:35:48 2021

To: LIVERMAN Alex * DEQ

Subject: RE: City of Portland

Importance: Normal

What I’m thinking is that we say in the agreement settling the case that we’ll reduce the EB to the reduced amount unless they don’t meet the deadline of the end of the year, in which case the reduced EB becomes due and payable. I’ve done that in other cases and it definitely provides them with an incentive to be diligent and if for some reason, they had a reason that is beyond their control that they cannot meet the deadline, we could extend it. I would not consider delays in permitting approvals as beyond their control. While I get that they have permitting requirements, it is still their own processes (if it is that onerous, perhaps they should take a look at that!) and, in my opinion, they should have started those processes, giving them the greatest benefit of the doubt we can, last summer after the land use decision, not nearly a year later.

And yes, some programs’ penalties go into the program funds such as HSRAF, oil spills, and UST compliance.

From: LIVERMAN Alex * DEQ <alex.liverman@deq.state.or.us>

Sent: Friday, March 26, 2021 11:01 AM

To: ELWORTH Susan * DEQ <susan.elworth@deq.state.or.us>

Subject: RE: City of Portland

Hi Susan.

Thanks again for your diligent work on this kooky issue. Please see my thoughts/questions in [red] within your text below.

--Alex

From: ELWORTH Susan * DEQ <susan.elworth@deq.state.or.us>

Sent: Friday, March 26, 2021 10:45 AM

To: LIVERMAN Alex * DEQ <alex.liverman@deq.state.or.us>

Subject: City of Portland

Alex – I have been thinking about the City of Portland penalty and am thinking that we should offer to remove the EB based on the fact that the installation of the stormwater features will be funded by the lottery grant. For that reason, the City has not had access to the funds nor has it gained any benefit from the delay expending those funds. [agree] This reduction would be contingent on them installing the required stormwater features by sometime this fall. What would you recommend for that timeline? [I’m reluctant to guess, since they haven’t met any of the dates they’ve previously agreed to or that we’ve imposed. Could we ask them to give us an absolute drop dead date? Or maybe just make it at the end of the year, to be somewhat safe?] The alternative to that is to recalculate the EB factor as a delayed cost to that expected compliance date. [I support this approach] By way of reference, if we use a compliance date of 12/31/21, the EB would be $10,151.

In terms of their argument that they were not negligent, I would not recommend any reduction in the M factor. I do believe that they have not prioritized this project and could have made changes in the project several years ago to facilitate compliance with the consent order, thus they did not take reasonable steps to avoid the violation. Additionally, because we already gave them C factor credit for taking steps to minimize and correct the violation, I would not recommend any changes for that factor. [agree]

With the removal of the EB factor, the penalty would be reduced to $9,600. Ultimately, I think we have accomplished both the specific and general deterrence we are hoping for with that penalty amount. [Agree, but I support adding the amount for delay, since that actually worsened the environmental damage. Even if, as they argue, the City’s complicated permitting/land use review and approval processes contributed to their delay, some of it was just poor organization and bad prioritization. And perhaps they should be aiming to solve the complicated process conundrums that so many projects (including their own) get tripped up by.]

With a $9,600 penalty, they could off-set $7,680 of that with a project, paying $1,920 to the program. I didn’t think about the fact that this penalty would go to the program (and not general fund) so we will probably want to be extremely picking about any environmental project we approve. [I didn’t realize that any of the penalty would come to the Cleanup program. Does that mean that if they don’t opt for a SEP, then all of the penalty would fund the Cleanup program? We should definitely have Paul weigh in on this.]

Have a good weekend! [You, too!!!!] Susan