Avoid uncomfortable regulatory disputes before they happen by conducting an internal compliance audit.
By Timothy K. Nytra
Would you like to:
Avoid regulatory and subsequent corporate management confrontations that come from Notices of Violation that include civil penalties and consent order conditions?
Build good relations with the people in your community so they will not oppose plans for expansion?
See the benefits from implementing cost-saving and revenue-generating ideas?
Improve the value of your landfill, should a selling opportunity present itself?
One way to achieve these advantages is to conduct an “internal compliance audit,” which involves commissioning qualified professionals to examine your landfill operation and carry out the same onsite and desktop analyses that would be conducted for a regulatory mandated compliance audit.
The difference is in the purpose. Most landfill audits are conducted by state or county regulatory agencies for compliance reasons. They are part of how regulatory agencies address the potential nuisance issues to public safety and impacts to the environment from non-compliant landfills.
An internal audit, by contrast, is done to identify potential problems before they get serious, to find areas where the operation may be wasting money or time, and to look for ways that improve landfill operations.
The internal audit process includes a large serving of advice and recommendations. Conducted by qualified professionals generally employed by an independent firm, the audit leverages the expertise of those professionals in three main areas:
- Operational Efficiency—Identifying improvements that could help avoid problems, reduce costs and maximize revenues, possibly based on the auditor’s experience with best practices used at other well operated landfill sites.
- Compliance—Identifying issues at the landfill that may be (or become) concerns for regulatory authorities so that those issues can be dealt with pre-emptively rather than under pressure from regulators.
- Design Features—Identifying areas that should be improved, such as components of the site’s active landfill gas (LFG) or leachate collection systems.
What Can Be Gained Through a Landfill Audit?
Sure, the suggestion to spend money is not always a welcomed one when operators are charged with running a tight ship. But what if there were compelling reasons to make an investment up front in order to save on maintenance, corrective actions or negative PR down the line, or even increase the landfill site’s value? The following are some benefits to conducting internal landfill audits.
The Goodwill of Regulators and Political Leaders
Being in the crosshairs of state or county authorities is never pleasant. Scrutiny from those authorities may have come to pass because of complaints from local residents about any number of potential problems—offsite odor emissions, trash blowing off the landfill property or mud being tracked onto local roads from waste hauling vehicles. Local environmental groups may be concerned about impacts from the landfill to surface or groundwater.
It is much better to discover potential problems through a “friendly” internal audit done voluntarily, rather than under orders from regulators who are feeling the pressure from stakeholders.
Simply undertaking a voluntary internal audit, and, ultimately, being able to show positive results to concerned stakeholders, political leaders and environmental groups, goes a long way towards ensuring goodwill and a positive reputation.
It is important to note that if a landfill attracts negative comments in the news media and social media, that record is available online forever for anyone to see. Reports of a landfill operator’s bad practice in Pennsylvania, for example, can be found through an online search and cited by stakeholders in another part of the country, such as California, where the company may want to open a new facility or expand an existing site. One can imagine the angry questions being asked in a town hall meeting: “This company has a terrible record back East. Just look at these headlines. And you want to let them come and establish a landfill operation here?”
Lower Operational Costs
Experience with landfill audits shows that there are nearly always opportunities to reduce costs that are discovered during the course of the audit. This might include situations such as under-designed drainage ditches, which are ill-equipped to handle the runoff from a 25-year design storm. That might allow muddy water to be swept into the sedimentation ponds after significant rain events, requiring more frequent dredging and excessive maintenance.
Inadequate care in the form of a poorly operating truck wash installed to clear the mud off trucks as they exit the property means that mud gets pulled onto the public roadway. As a result, landfill staff must go out onto the roads with sweepers to take care of the problem before the switchboard at the county office starts lighting up with complaints. The audit might suggest ways to clean the trucks—improve the truck wash—before they drive away.
Sometimes, the cost-saving measures are simple fixes and changes to procedures—or just the enforcement of established procedures. Sometimes they involve capital improvements, such as improvements to the active LFG system. It might also be possible to find ways to increase revenue, like power generation from LFG, or maybe designing the landfill in such a way that it can be turned to other uses after closure—a golf course or the installation of solar panels.
Financial Opportunities
If the landfill operator is considering selling one or several of its locations, having a clean set of financial statements listing the value of the assets and indicating the revenue and costs is essential.
It is the same with a voluntary internal operational audit. Anyone considering buying a landfill will want to know about what operational problems it might have, including the regulatory compliance issues as these risks form part of the valuation of the property. Having a series of regular internal operational audits—documenting the landfill’s compliance status and the steps that were taken, if necessary, to resolve them—goes a long way to reassuring a potential purchaser. This, in turn, may persuade the purchaser that the landfill has a higher valuation than one that offers more uncertainty and question marks than it does answers.
What to Look for in a Landfill Auditor
The auditor you choose should likely be a third party, for two reasons. One is that an audit prepared by an independent provider, with a reputation for neutrality to uphold, will likely get more acceptance from stakeholders, regulators and environmental groups. The second reason is that the firm’s experience with other landfills gives it a valuable perspective on what works elsewhere, and current best practices.
The auditing firm you choose needs expertise in three main areas:
- Landfill Operations—Knowing the realities of how to run a landfill, the right equipment to use, how to deploy staff most effectively, and how to avoid nuisance problems such as odor, noise, dust and litter.
- Regulatory Requirements—Expertise on the latest applicable regulations—environmental, health and safety, and operational—and the steps that the operator can take to meet those expectations.
- Design—Understanding design of the cells and final cover, the leachate and condensate collection systems, active LFG collection and control system, and even site waste filling operations and traffic flow.
With respect to the internal compliance audits, it is important that the firm conducting the audit have an arm’s-length independence from the landfill. It is not essential for a firm to have a relationship with the landfill site; however, having a fresh set of eyes examining the landfill may result in more insights that the operator can use.
Timothy K. Nytra is a Principal with Civil & Environmental Consultants, Inc., based in the firm’s Pittsburgh, PA office. He can be reached at (412) 275-2999 or via e-mail at [email protected].