The easy-to-use ABEL software evaluates for-profit company claims of inability to afford penalties, clean-up costs, or compliance costs. Violators raise the issue of inability to pay in most of EPA's enforcement actions regardless of whether there is any hard evidence supporting those claims. The program enables Federal, State and local enforcement professionals to quickly determine if there was any validity to those claims. ABEL is a tool that promotes quick settlements by performing screening analyses of defendants and potentially responsible parties (PRP's) to determine their financial capacity. If ABEL indicates the firm can afford the full penalty, compliance or clean-up costs, then EPA makes no adjustments for inability to pay. If it indicates that the firm cannot afford the full amount, it directs the enforcement personnel to review other financial reports before making any adjustments. After analyzing some basic financial ratios that reflect a company's solvency, ABEL assesses the firm's ability to pay by focusing on projected cash flows. The model explicitly calculates the value of projected, internally generated cash flows from historical tax information, and compares these cash flows to the proposed environmental expenditure(s). The software is extremely easy to use. Version 2.9 updates the standard values for inflation and discount rate. Users are taken through a series of prompts to enter specified data. On screen 'help' information is available at any time. Two other similar models are INDIPAY and MUNIPAY (PB98-500374). INDIPAY does the same analysis for individual taxpayers (including sole proprietorships and partnerships). MUNIPAY does this same analysis for municipalities, towns, counties, drinking water authorities, and sewer authorities. EPA's Office of Enforcement and Compliance Assurance (OECA) has developed a series of computer models to support its penalty assessment and cost recovery responsibilities. The models are also used in most states.
The models deal with four different financial issues that frequently arise in enforcement cases: calculating the violator's economic savings noncompliance (BEN model); evaluating the validity of a violator's claim that it cannot afford compliance costs (ABEL and INDIPAY models), clean-up costs and civil penalties; determining the present year value of Superfund clean-up (CASHOUT model); and determining the real cost of proposed extra compliance project (PROJECT model).