[Senate Hearing 106-322]
[From the U.S. Government Publishing Office]
S. Hrg. 106-322
SUPERFUND PROGRAM COMPLETION ACT OF 1999
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HEARING
BEFORE THE
COMMITTEE ON
ENVIRONMENT AND PUBLIC WORKS
UNITED STATES SENATE
ONE HUNDRED SIXTH CONGRESS
FIRST SESSION
ON
S. 1090
A BILL TO REAUTHORIZE AND AMEND THE COMPREHENSIVE ENVIRONMENTAL
RESPONSE, LIABILITY, AND COMPENSATION ACT OF 1980
__________
MAY 25, 1999
__________
Printed for the use of the Committee on Environment and Public Works
U.S. GOVERNMENT PRINTING OFFICE
59-378 cc WASHINGTON : 2000
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For sale by the U.S. Government Printing Office
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COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
one hundred sixth congress
JOHN H. CHAFEE, Rhode Island, Chairman
JOHN W. WARNER, Virginia MAX BAUCUS, Montana
ROBERT SMITH, New Hampshire DANIEL PATRICK MOYNIHAN, New York
JAMES M. INHOFE, Oklahoma FRANK R. LAUTENBERG, New Jersey
CRAIG THOMAS, Wyoming HARRY REID, Nevada
CHRISTOPHER S. BOND, Missouri BOB GRAHAM, Florida
GEORGE V. VOINOVICH, Ohio JOSEPH I. LIEBERMAN, Connecticut
MICHAEL D. CRAPO, Idaho BARBARA BOXER, California
ROBERT F. BENNETT, Utah RON WYDEN, Oregon
KAY BAILEY HUTCHISON, Texas
Jimmie Powell, Staff Director
J. Thomas Sliter, Minority Staff Director
(ii)
C O N T E N T S
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Page
MAY 25, 1999
OPENING STATEMENTS
Baucus, Hon. Max, U.S. Senator from the State of Montana......... 2
Chafee, Hon. John H., U.S. Senator from the State of Rhode Island 1
Crapo, Hon. Michael D., U.S. Senator from the State of Idaho..... 5
Graham, Hon. Bob, U.S. Senator from the State of Florida......... 57
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma... 4
Lautenberg, Hon. Frank R., U.S. Senator from the State of New
Jersey......................................................... 5
Smith, Hon. Robert, U.S. Senator from the State of New Hampshire. 21
Voinovich, Hon. George V. U.S. Senator from the State of Ohio.... 15
WITNESSES
Caveney, Red, president and CEO, American Petroleum Institute.... 48
Prepared statement........................................... 107
Curtis, Tom, director, Natural Resources Group, National
Governors' Association......................................... 25
Prepared statement........................................... 66
Responses to additional questions from Senator Voinovich..... 68
Florini, Karen, senior attorney, Environmental Defense Fund...... 43
Article, Analysis and Perspective, Superfund Site Remedies... 94
Prepared statement........................................... 88
Ford, Mike, National Association of Realtors..................... 50
Prepared statement........................................... 111
Gregor, Mark, manager, Division of Environmental Quality, City of
Rochester, NY.................................................. 45
Prepared statement........................................... 101
Johnson, Gordon J., Assistant Attorney General, New York State... 28
Prepared statement........................................... 72
Resolution, National Association of Attorneys General........ 80
Responses to additional questions from:
Senator Baucus........................................... 82
Senator Lautenberg....................................... 84
Kerbawy, Claudia, Chief, Michigan Superfund Program on behalf of
the Association of State and Territorial Solid Waste Management
Officials...................................................... 26
Prepared statement........................................... 68
Marshall, Jim, mayor, Macon, GA.................................. 7
Prepared statement........................................... 57
Nobis, Mike, general manager, JK Creative Printers, Quincy, IL... 47
Prepared statement........................................... 105
Reilly, Bernard J., corporate counsel, DuPont de Nemours E.I. and
Company........................................................ 41
Prepared statement........................................... 86
Subra, Wilma, Subra Company, New Iberia, LA...................... 30
Prepared statement........................................... 85
Suozzi, Thomas, Mayor, Glen Cove, NY............................. 10
Prepared statement........................................... 63
ADDITIONAL MATERIAL
Letter, Hazardous Waste Action Coalition......................... 113
Statements:
Association of Battery Recyclers............................. 112
Hazardous Waste Action Coalition............................. 114
Nuclear Energy Institute..................................... 114
Resolution, National Association of Attorneys General............ 80
SUPERFUND PROGRAM COMPLETION ACT OF 1999
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TUESDAY, MAY 25, 1999
U.S. Senate,
Committee on Environment and Public Works,
Washington, DC.
The committee met, pursuant to notice, at 10 a.m. in room
406, Senate Dirksen Building, Honorable John H. Chafee
(chairman of the committee) presiding.
Present: Senators Chafee, Inhofe, Baucus, Crapo,
Lautenberg, Smith and Voinovich.
OPENING STATEMENT OF HON. JOHN H. CHAFEE,
U.S. SENATOR FROM THE STATE OF RHODE ISLAND
Senator Chafee. We want to welcome everyone this morning.
We've got a long series of witnesses, so we're going to move
right along.
Tomorrow we had the Administrator scheduled to be here plus
GAO as witnesses. I think what we'll do tomorrow is not have
the hearing. But because there are possibilities of working
something out here, and at the suggestion of the Administrator,
we'll have a meeting with the Administrator, myself, Senator
Smith, Senator Lautenberg, Senator Baucus, and see if we can't
work something out here. I think that would be a worthwhile
proposal.
The Administrator has suggested it, Senator Baucus has
mentioned it, and I think it presents possibilities of
resolving this situation. We have a bill in, the Republicans
do, as I understand, the Democrats on the committee have or
will introduce a bill. And let's see if we can't reach some
kind of a compromise and get on with this. We've spent so much
time over so many years.
Senator Baucus. Mr. Chairman, I compliment you for that
decision. I think it will help us achieve a bipartisan
Superfund bill. I'm not saying that will necessarily happen,
but giving us the opportunity to talk over it with the
Administrator and also have a little more information before us
for the next hearing, particularly with respect to cost and
some other matters. I think that will be very helpful and will
likely work out a lot of the various issues that are before us.
So I thank you for making that decision.
Senator Chafee. OK, now I have a statement which I'll put
into the record, and I'll encourage others to do likewise.
[The prepared statement of Senator Chafee follows:]
Statement of Hon. John H. Chafee, U.S. Senator from the State of Rhode
Island
Good morning. I am pleased to begin 2 days of hearings on S. 1090,
the ``Superfund Program Completion Act of 1999.'' I thank Senator Smith
for his leadership on Superfund and his help in crafting a bill which
focuses on areas where bipartisan consensus is achievable this year.
S. 1090 includes many provisions that have enjoyed widespread
bipartisan support in the Senate, provisions included in bills
supported by Democrats and Republicans over the past 6 years. Working
together with Senators Baucus and Lautenberg, I am confident we can
effect real legislative reform on some of Superfund's more immediate
problems.
S. 1090 will provide $100 million in grants for State, tribal and
local governments to identify, assess and redevelop Brownfields sites.
It protects prospective purchasers of contaminated sites, innocent
owners of properties adjacent to the source of contamination, and
innocent property owners who exercised due diligence upon purchase.
Our bill exempts small businesses and contributors of very small
amounts of hazardous and municipal solid waste. S. 1090 limits the
liability of larger generators or transporters of municipal solid
waste, as well as owners or operators of co-disposal landfills where
municipal solid waste is disposed. The bill limits the liability of so-
called de minimis parties, as well as municipalities and small
businesses with a limited ability to pay.
Cleanup is complete or underway at over 90 percent of the sites on
the current National Priorities List. While EPA is cleaning up the
sites at a rate of 85 per year, only an average of 26 per year are
listed. In 1998, GAO surveyed the States and EPA about the 3,000 sites
identified as potential NPL sites. Of these sites, only 232 were
identified as likely to be listed on the NPL. Clearly, this program
will be getting smaller.
S. 1090 requires EPA to plan how it will proceed at those 3,000
sites. We know that most of these sites will be cleaned up by States,
not by EPA. Under S. 1090, new NPL listings must be requested by the
Governor of the affected State.
The bill allows the program to be funded from either general
revenues or the Trust Fund. Senator Smith and I have said that the
Superfund taxes should not be reimposed absent comprehensive Superfund
reform. If EPA improves its cost recovery performance and the Trust
Fund balance exceeds levels needed to fund liability relief, it can be
used for Superfund cleanup.
I cannot understand why anyone would fail to support this bill. It
accelerates Brownfields redevelopment and strengthens State programs.
It limits or eliminates liability for many parties caught in
Superfund's broad liability net, and it does not undermine the
``polluter pays'' principle, but instead strengthens it.
The committee will markup S. 1090 soon after returning from the
Memorial Day recess. It is my hope that the bill will be ready for
floor action prior to the Fourth of July. I look forward to working
with committee members and the Administration as we focus on the future
of the Superfund program.
Senator Chafee. Let me just say that I think we've got a
good bill. I suppose that's not unusual, to expect somebody
who's sponsoring a bill to think it's a good bill. I don't
think that will make me unique.
But what our bill does is it accelerates brownfields
redevelopment, strengthens State programs, limits or eliminates
liability from any parties caught in Superfund's broad
liability net, and doesn't undermine the polluter pays
principle, but strengthens it.
So I will ask that this statement go into the record. If
others have statements they'd like to put in the record, now is
a good chance.
OPENING STATEMENT OF HON. MAX BAUCUS,
U.S. SENATOR FROM THE STATE OF MONTANA
Senator Baucus. Mr. Chairman, I have a statement which is
several pages which I will also put in the record. But I want
to make a couple of points. First, I appreciate the provisions
in your bill which are obviously intended to help move toward a
compromise. And I think we have an opportunity here to find
that bipartisan compromise.
A couple of points, though, there are a couple of issues
that have to be dealt with. The relationship between State
voluntary cleanups and the suburban program referred to as
Finality, we have to find some way to deal with that. Because
it does make sense, it seems to me, not to give carte blanche
wholly to States but rather have some kind of a good resolution
of that issue.
Second, the Fair Share Allocation System in your bill I
think has to be examined to be sure that it does not cause more
problems than we already have. One is the potential cost of
reimbursing parties that might affect the pace of cleanups.
We'll look at the details, which are very important.
And also our funding. It looks like the bill will generate
some new program costs, such as mandatory allocations and
inventory special parcels. These may be good ideas, but they
also make cumulatively generate some additional costs. And also
the provision in the bill which reduces authorization levels
quite sharply, which suggests that the pace of cleanup might be
reduced. I don't think that's something that we want.
Also we have to all look at financing. Because the bill
does not contemplate any reinstatement of Superfund tax that
has previously been associated very definitely with the fund.
Because when the Superfund law was enacted, it was enacted with
very strong intent to have a fund which would pay for the
program. In fact, when President Carter suggested the bill,
that was very much a part of what he suggested, and also in the
report language that the Congress wrote with respect to the
bill, that also was very integral, as part of the program.
So essentially, we want to make sure we get the job done,
that is, complete the cleanup, complete it fairly, but make
sure we also have the resources to accomplish that objective.
And with that, Mr. Chairman, I will conclude my remarks.
[The prepared statement of Senator Baucus follows:]
Statement of Hon. Max Baucus, U.S. Senator from the State of Montana
Thank you, Mr. Chairman. To me, S. 1090 presents both good news and
bad news.
On a positive note, the bill drops several very contentious
provisions that we were unable to resolve last year. I know how
strongly Senator Smith feels about some of these issues.
So we recognize and appreciate the step that you and he have taken.
This creates an opportunity for us to find a fresh approach to a
bipartisan compromise.
If we are to do that, we also need to address the areas where the
bill still needs improvement.
First, there are a number of tough issues in the bill. For example,
the relationship between state voluntary cleanups and the Superfund
program, which is often referred to as the question of ``finality.'' As
we know, state programs vary widely in their effectiveness. That is why
I believe that a Federal safety net would assure protection of public
health and the environment.
But that is an issue, like many others in the bill, that, if we
make an earnest, good faith effort, with give and take on both sides,
we should be able to resolve.
Second, the fair share allocation system. I agree that we should
increase fairness and reduce litigation and other transaction costs. I
also agree that orphan share funding is an important way to achieve
this goal.
But I have some concerns. One is the cost, especially the cost of
reimbursing parties. Another is the potential impact on the pace of
cleanups. Finally, like many other issues, the devil is in the details.
And I hope this hearing will help answer our questions.
Third, and probably most important. Funding. As we read the bill,
it will generate new program costs, such as mandatory allocations, an
inventory of separate parcels of land, and a review of all the 3,000
sites in the Superfund data base. These may be good ideas, but they are
expensive.
At the same time, the bill reduces authorization levels, sharply.
Furthermore, it contains a provision that prevents site cleanup if
there is not enough money available to pay companies all of their new
orphan shares.
para.These provisions, in combination, may result not in the
``completion'' of the Superfund program, as the bill's title suggests,
but in a sharp reduction in the pace of cleanups, at the expense of
thousands of people living near hazardous waste sites.
I know that is not the chairman's intent. And I appreciate the
chairman's efforts to get solid data about cleanup costs, something I
hope we can begin to resolve with EPA this week.
But, as we go forward, we must be very careful, to assure that this
bill provides the funding necessary to get the job done.
I look forward to working with the Chairmen, Administrator Browner,
and others to assure this.
That brings me to a final point. Financing the cleanup program.
As I understand it, S. 1090 does not contemplate reinstatement of
the Superfund taxes that previously have gone into the Superfund trust
fund. Instead, it would fund cleanups almost exclusively out of general
revenues.
Some may think that this is a small matter of accounting. I
disagree.
Ever since the Superfund program was established, one of its
critical features has been the existence of a special trust fund,
financed by earmarked taxes.
When this committee reported the first Superfund bill, back in
1980, we described our main objectives. The first was assuring that
responsible parties pay for environmental damage.
We went on, and I quote:
``Second, providing a fund to finance response action where a
liable party does not clean up, cannot be found, or cannot pay the
costs of cleanup and compensation.''
``Third, basing the fund primarily on contributions from those who
have been generically associated with such problems in the past and
who today profit from products and services associated with such
substances.''
We reaffirmed this in 1986 and 1990. The fund, and the earmarked
taxes, have been an integral part of this cleanup program.
Now, we're considering reauthorizing the Superfund program--but
without the Superfund. This, to my mind, is unwise and unwarranted.
With the budget pressures we face, we have to find a way to pay for
this program.
Mr. Chairman, it is my hope that we can work to resolve our
differences over the operation of the program. And, as the process goes
on, renew our longstanding commitment to a dedicated trust fund with an
assured source of revenue.
I look forward to working cooperatively with my colleagues toward
those ends.
Senator Chafee. Does anyone else want to put a statement in
the record? Senator Inhofe.
OPENING STATEMENT OF HON. JAMES M. INHOFE,
U.S. SENATOR FROM THE STATE OF OKLAHOMA
Senator Inhofe. I have a statement to go in the record, so
I'll make this very brief. Mr. Chairman, I characterize it in
my mind as a kind of good bill, not great. There are a lot of
things I'd like to see in here, NRD, many things.
However, I think requiring the Governor's approval before
listing an NPL, as a former mayor, I think that's a good idea
and I'd like to get as much of that at the local level as
possible. I think the fact that you did resist the
reauthorization of the taxes is good.
So as it is now, I would support it, but it could sure be a
lot better, and I'm hoping that we'll be able to get some
amendments and work on this to make it what I consider to be a
better bill. I'll submit my entire statement for the record.
[The prepared statement of Senator Inhofe follows:]
Statement of Hon. Jim Inhofe, U.S. Senator from the State of Oklahoma
Mr. Chairman. thank you for holding this important hearing today.
You and Senator Smith have done outstanding work in crafting a bill
that addresses those issues that can and should be changed within the
program.
I know not everyone is happy with your bill, and I too would like
to see some amendments added during markup, specifically regarding NRD.
But we must not loose focus of our goal. The process is broken and we
must fix it in a way that will allow cleanups to take place more
quickly and efficiently while continuing to provide adequate protection
to the public.
I do want to briefly comment on some aspects of the bill that I
think are positive. First, by requiring Governors' approval before
listing a site on the NPL, we are putting control back into the hands
of the local governments who have the most at stake. As a former mayor,
I can appreciate that negotiating with a Governor over a particular
course of action would be preferred to negotiating with the EPA.
Second, I am happy that you have decided to exempt small businesses, de
micromis contributors of hazardous waste, and recyclers, specifically
used oil, from liability under Superfund. This helps to level the
playing field for those who are least able to afford the costs of
cleanups. Finally, I support you and Senator Smith in your effort to
resist re-authorizing the Superfund taxes. I agree with the arguments
that you laid out in your letter to Timothy Fields at EPA, specifically
that many parties who have engaged in their own cleanup effort would be
liable for the tax if reimposed. Without sweeping changes to the
program, taxes should not be reinstated.
Mr. Chairman, I look forward to hearing from our witnesses today on
both their personal experience with Superfund and their views on your
bill, S. 1090. Thank you.
Senator Chafee. Thank you. Go ahead, Senator Crapo.
OPENING STATEMENT OF HON. MICHAEL D. CRAPO,
U.S. SENATOR FROM THE STATE OF IDAHO
Senator Crapo. Thank you, Mr. Chairman. I'll be brief.
I agree that there are a lot of good elements in the bill.
As the chairman knows from discussions we've had, there are
things I think should be put into the bill that aren't in the
bill yet. As Senator Baucus indicated, if we go on and evaluate
the issues of funding and financing, namely, the reinstitution
of the taxes, if those issues are brought onto the table, in
addition to what is now in the bill, then I think we also have
to make sure that we finish the job, as Senator Baucus said.
And that job requires that we not only do the good things
that are in this bill now, but that we provide a comprehensive
reform of the Superfund law, meaning we've got to look at the
critical issues of liability and remedy in more detail and
natural resources damages in more detail, and make sure that we
do the job entirely.
I believe there are lots of good things in this bill,
there's a lot that needs to be put into the bill still,
especially as we now move into the arena of discussing whether
the taxes should be reauthorized.
Senator Chafee. Thank you. Senator Lautenberg.
OPENING STATEMENT OF HON. FRANK R. LAUTENBERG,
U.S. SENATOR FROM THE STATE OF NEW JERSEY
Senator Lautenberg. Mr. Chairman, I don't want to be a
spoil-sport. But first, let me commend you for the proposal
that you put out that would have us discussing further some of
the concerns or the questions that have arisen.
But also with a matter of this magnitude, I think it is
important to have our statements being able to be issued and
heard. Because this is a very crowded schedule, and I respect
that. I know, Mr. Chairman, as do many, that you've been very
anxious to keep the program going and to make the changes that
you deemed necessary.
I have a statement of, I would say not intolerable length,
but that's my view. I won't challenge the committee decision to
give it, but I put it in the record reluctantly. I think that
statements that go in the record are often seen on their way in
and never seen again. And that for me, when we're discussing a
subject as important as this subject, Mr. Chairman, you and I
and Senator Baucus have been working with for 5 years now, and
we came very close at one point to having a resolution. It
didn't work.
I am concerned about the funding ramp-down. I'm on the
Budget and Appropriations Committees. And there's just not
going to be enough money to carry on, the cap on the NPL
concerns me, the reopening of decisions. There are several
things. And because we have an illustrious witness group here,
we want to hear what they have to say and we don't want to
listen to ourselves, I don't think.
But the fact of the matter is that we lose an opportunity
to kind of help set an environment or stage that we'd all like
to operate with. There are so many successes with the program
as it is that before we change the whole thing, I think we need
a fair amount of review. So in respect to you, Mr. Chairman, I
will not give the statement at this time. I'll put it in the
record and make another opportunity to give it.
[The prepared statement of Senator Lautenberg follows:]
Statement of Hon. Frank Lautenberg, U.S. Senator from the State of New
Jersey
Mr. Chairman, we are here again today to consider the
reauthorization of Superfund. It has been a very long time since we
began this process in the 103d Congress. Yet, during this time, the
program has undergone major changes, and major improvements.
In fact, as just about everyone involved in the Superfund program
agrees, there have been major strides made in the number and pace of
the sites being cleaned up.
In fact, in the 103d Congress, the critics of Superfund raised a
number of issues. They asserted that it was too slow, that not enough
cleanups were taking place, that there was too much litigation.
Back then, we were seeking solutions which would make the program
faster, streamline cleanups, treat parties more fairly and get the
little guys out earlier, all while keeping those responsible for the
problem also responsible for cleaning it up. This was all within the
general goals of achieving more cleanups and therefore providing better
protection of human health and the environment.
I am proud of those proposals, and many of us still on this
committee, including the chairman, who voted for that bill way back in
the 103d Congress should also be proud. Those proposals, although never
enacted into law, were adopted administratively by EPA and radically
altered the Superfund Program as we know it.
Others have been tested and been improved upon. In general the
thrust of this well intentioned bill has resulted in many of the
achievements of the current program.
According to a report issued by the General Accounting Office, by
the end of this fiscal year all cleanup remedies will have been
selected for 95 percent of non-Federal NPL sites (1,109 of 1,169
sites).
In addition, approximately 990 NPL sites have final cleanup plans
approved, approximately 5,600 ``emergency removal'' actions have been
taken at hazardous waste sites to stabilize dangerous situations and to
reduce the threat to human health and the environment.
More than 30,900 sites have been removed from the Superfund
inventory of potential waste sites, to help promote the economic
redevelopment of these properties.
During this same time, EPA has worked to improve the fairness and
efficiency of the enforcement program, even while keeping up the
participation of potentially responsible parties in cleaning up their
sites.
EPA has negotiated more than 400 de minimis settlements with over
10,000 small parties, which gave protection for these parties against
expensive contribution suits brought by other private parties. 66
percent of these have been in the last 4 years alone. Since fiscal year
1996, EPA has offered ``orphan share'' compensation of over $145
million at 72 sites to responsible parties who were willing to step up
and negotiate settlements of their cases. EPA is now offering this at
every single settlement, to reward settlers and reduce litigation, both
with the government, and with other private parties.
These are just a few highlights of the improvements made in the
program, many drawn from our earlier legislative proposals. Other
improvements, such as instituting the targeted review of complex and
high-cost cleanups, prior to remedy selection, have reduced the cost of
cleanups without delaying the pace of cleanups.
In short, EPA's administrative reforms have significantly improved
the program, by speeding up cleanups and reducing senseless litigation,
and making the program fairer, faster and more efficient overall.
But despite the fact that this is a program that has finally really
hit its stride, we are now faced with proposals from the Majority which
could undercut the progress in the program, and which are premised on a
goal of closing down the program rather than a goal of cleaning up the
sites.
I am deeply troubled by many of the provisions in the Republican
bill, which would have the effect of ramping the program down without
regard to the amount of site work left to be done.
This bill provides for lowered funding levels, a cap on the NPL,
waivers of the Federal safety net, and some broad liability exemptions.
At the same time, it creates a number of new, expensive obligations
which would further reduce the amount of money available for cleanup.
It also shifts the costs of the program to the taxpayers and would not
include an extension of the Superfund tax.
In short, while I am encouraged by the fact that the Republican
bill drops some troubling provisions from prior bills, it introduces a
whole set of new issues that we cause for great concern.
I think it is very clear that what we need here is a better
Superfund program, not a retreat from tackling our environmental
problems.
We need a bill that continues to accelerate the pace of cleanups,
keeps cleanups protective, reduces litigation and transaction costs, is
affordable and does not shift costs to the American taxpayer.
Yesterday, with some of my colleagues, I introduced such a bill.
believe that this bill, is in some areas very close to the provisions
supported by my Republican colleagues, but differs in some critical
areas. It would protect cleanups, reduce litigation and not shift costs
to the American taxpayer.
I hope that these are goals we can agree on. And I urge my
colleagues to not throw the Superfund baby out with the bathwater.
I look forward to working with my colleagues as we move forward.
Thank you, Mr. Chairman.
Senator Chafee. Good, fine. Thank you very much.
We've got 13 witnesses this morning, and we've obviously
got to move along at a fair nonetheless brisk pace.
First we welcome the Honorable Jim Marshall, Mayor of
Macon, Georgia, on behalf of the U.S. Conference of Mayors.
Mayor, won't you proceed?
STATEMENT OF HON. JIM MARSHALL, MAYOR, MACON, GEORGIA
Mr. Marshall. Thank you, Mr. Chairman.
Mr. Chairman, I represent the United States Conference of
Mayors. The conference represents more than 1,000 cities of
population 30,000 and over and the total U.S. population in
those cities is in excess of 119 million. Every single one of
those cities suffers from the brownfield problem, Mr. Chairman.
We have a report done by the United States Conference of
Mayors, I believe it's part of the record. One hundred 80
cities responded to the request for information about
brownfields, and you'll find the information in the report.
Nineteen thousand sites, just the 180 cities, 19,000 sites,
were identified, 178,000 acres are affected by this. Mr.
Chairman, that's only 180 cities. There are some 2,000
municipalities in the United States that are not represented by
this survey.
So the problem, Mr. Chairman, is enormous. I can speak of
the problem from my own personal experience as the Mayor of
Macon, Georgia. But Macon's experience is replicated across the
United States, there's no question in my mind about that.
When the conference first made an attempt to do a survey on
brownfields about 3 years ago, I received the request for
information and I sent it along to the key person in the middle
Georgia area responsible for economic development and said,
could you help me out, could you fill this out for me. He got
back in touch with me and he said, I don't think you want to be
on this list.
So 3 years ago, we had the key economic development guy in
the middle Georgia region saying, let's keep it quiet. We know
we have these problems but we don't want to be on this list.
Last year, instead of sending the survey to our economic
development guy, I sent the survey to the head of our planning
and zoning commission, the executive director, the person who's
been in place for the last 20 years, a key planning character
in the middle Georgia region. I said, would you fill this out.
He sent it back to me. He identified one site. Again, not
interested in being on somebody's list.
This year, I managed to persuade the players that would
respond and we've identified seven sites with 100 acres. The
reality is, in Macon and other cities, it's far more than seven
sites and far more than 100 acres.
But it's a problem that everybody wants to ignore,
everybody wants to keep quiet. The effect of this problem, Mr.
Chairman, and I believe, I co-chair the Mayors and Bankers Task
Force for the Conference. And the mayors and bankers are
focusing on brownfields right now. I believe Senator Helmke,
who is my co-chair, testified a couple of weeks ago.
Senator Chafee. He did, yes.
Mr. Marshall. I suspect he was very effective in trying to
describe the problem. I don't want to go over ground that he's
already tread.
But the problem here is one that exacerbates greatly our
sprawl phenomena. You have many owners of properties that are
lying fallow in the inner city, already serviced by the
infrastructure that's necessary in order for them to be very
productive pieces of property.
But they sit there because the owners of those properties
are not interested in getting the bad news. It's kind of like,
I'm not going to go see the doctor, even though something's
wrong with me, because I'm worried the doctor might tell me
I've got cancer. The same thing is happening with a lot of
owners.
As a result of that, a lot of this land in the center of
our cities is lying fallow because the owners don't even want
to know. They don't want to find out that this land that might
be worth current market, $5,000 an acre, is going to cost
$20,000 an acre to clean up.
So an initial problem is how do you get the holders of
these properties off dead center. It's easy enough for me to do
where housing is concerned. I took over as mayor about three
and a half years ago. We doubled our housing inspections force.
I changed judges, I moved the housing inspector's unit to
another department. We changed management, we gave uniforms, we
went from card files to computers and digital cameras. We do
systematic inspections of low-income housing in the city of
Macon, distressed neighborhoods.
The effect of that has been to literally tenfold increase
the number of citations that are given. We've had a dramatic
improvement in the quality of substandard housing in Macon.
Well over 2,000 units have been repaired, 500 units have been
demolished. And it's because owners are forced to get off the
dime and do something with these properties instead of simply
just letting them sit there.
That description is analogous to the problem we have right
now with an awful lot of underutilized or unused properties in
our cities. It is simply sitting there, and there is no impetus
for these owners to get off the dime.
Now, even if an owner is interested in disposing of the
property, the flip side of the coin is nobody's interested in
picking up the property. The concern, of course, is liability
if you buy these properties and they wind up being
contaminated, or you find out they're contaminated. You've
purchased the property, you've purchased the contamination
problems.
It would be wonderful if there would be finality. That
would be a very big step forward, finality with respect to
liability. And protection for innocent purchasers. Those two
things would cause an awful lot of lenders and an awful lot of
potential purchasers and developers to have a great deal more
interest in coming into our inner cities and taking care of
these underutilized properties.
The problem we have right now, Mr. Chairman, is that the
land values in our inner cities, not necessarily inner city
Chicago, where the economics of a particular piece of land
might be such that the cleanup costs can be covered as part of
the transaction, for most of the cities across the country,
we're being held hostage by a legitimate interest in having
these properties cleaned up. Because of that legitimate
interest, buyers are not interested in buying, sellers are not
interested in discovering, potential sellers are not interested
in discovering the real problems with their property. The
cities are being held hostage.
The effect is to cause the economics to continue to
collapse. And you see sprawl phenomena like you see in the
Atlanta region, I'm sure everybody here is familiar with the
problems in Atlanta. That in the long run is going to
exacerbate our environmental problems.
Mr. Chairman, I know that you are very well known to be
very effective in crafting bipartisan efforts to solve problems
like this. And I know this committee has worked for years to
try to solve this problem. I would encourage the Chairman to
use his talents to pull folks together on a bipartisan basis to
try to at least give cities some relief.
If you can't solve all of the problems, a piece of
legislation like this one, loaded down with the kinds of
arguments that you all have been having with one another now
for 6 years, is not going to go anywhere. If it's possible to
craft some legislation that's bipartisan and will meet some of
the concerns that the Administration has, so that we can get
something done this year, the U.S. Conference of Mayors would
be very much appreciative of that.
If I could, Mr. Chairman, I'd like to address just one more
issue. I might be stealing a little bit of Mayor Suozzi's
thunder here. Liability for municipal landfills. Typically the
problem has been caused by a former set of taxpayers. We are so
mobile in the United States that you've got an old set of
taxpayers who typically cause the problem and now, unless some
relief is granted, the current set of municipal taxpayers are
expected to deal with that problem.
Well, I can tell you, Mr. Chairman, if that means raising
taxes in the inner city to deal with these old landfills, the
effect is going to be to simply drive people away from the
inner city. That's exactly the opposite phenomena we would all
like to see happen. We shouldn't be having higher taxes in the
inner parts of our metropolitan areas. It should be lower. The
financial incentive should be to push to the middle, not to
push to the periphery. In the long run, that's healthy for us.
To the extent that this committee can see its way to giving
some relief where municipal landfill liability is concerned,
what it effectively does is lessen or eliminate yet one more
reason for us to spread out. I thank you very much, Mr.
Chairman, for the opportunity to testify and I would be happy
to respond to questions.
Senator Chafee. Thank you very much, Mayor.
And now Mayor Suozzi, Mayor of Glen Cove, New York.
STATEMENT OF HON. THOMAS SUOZZI, MAYOR, GLEN COVE, NEW YORK
Mr. Suozzi. Mr. Chairman, thank you very much. Senators,
thank you very much and good morning.
My name is Tom Suozzi, I'm the mayor of the city of Glen
Cove, New York. It's a small city on the north shore of Long
Island with about 25,000 people. We cover an area of about
seven square miles. I'm pleased to be here to testify today
regarding the needs of local governments for municipal
Superfund liability relief, the narrow issue that Mayor
Marshall referred to.
I'm a member of the U.S. Conference of Mayors and endorse
everything that Mayor Marshall said. But I'm here today
representing eight other national municipal organizations that
worked together for many years to seek municipal Superfund
liability relief, so that we can resolve our involvement at
these toxic waste sites, reduce litigation and transaction
costs, and get on with the business of cleaning up and
recycling these blighted sites into productive redevelopment in
our communities.
These organizations include the American Communities for
Cleanup Equity, which was formed nearly a decade ago to address
these municipal Superfund issues, as well as the American
Public Works Association, the Association of Metropolitan
Sewage Agencies, the International City/County Management
Association, the International Municipal Lawyers Association,
the National Association of Counties, the National Association
of Towns and Townships, and the National League of Cities. I
have never really had this much impact before.
[Laughter.]
Mr. Suozzi. Collectively, our organizations represent
thousands of cities, towns, counties and local agencies across
the United States. We are responsible for the health, safety
and vitality of our communities and at the same time for
fulfilling a very fundamental governmental duty to provide for
municipal garbage and municipal sewage collection and disposal.
We want to thank you, Senator Chafee, for your leadership
and your commitment to addressing the issue of municipal
liability and Superfund legislation. We also want to commend
Senator Lautenberg, our neighbor in New Jersey, for championing
Superfund relief for local governments for many long years.
Indeed, as you know, there has been broad bipartisan,
multi-stakeholders consensus on this municipal Superfund relief
issue for many years. We hope that the parties will continue to
work together to get this municipal Superfund issue resolved
this year. No matter what other issues of contention may stand
in our way, we must pass something this year to try and get us
some relief.
Local governments have a very serious problem. We've been
saddled with years of delay, millions of dollars of liability
and legal costs under the Superfund law, simply because we
owned or operated municipal landfills or sent municipal solid
waste or sewage sludge to landfills that also received
industrial and hazardous waste. So a simple part of our jobs is
to get rid of our garbage and sewage.
Local governments have faced costly and unwanted
contribution suits from industrial Superfund polluters seeking
to impose an unfair share of costs on parties that contributed
no toxic wastes to these so-called co-disposal landfill sites.
We estimate that as many as 750 local governments at 250 sites
nationwide are affected by the co-disposal landfill issue.
The costs that our citizens bear as a result are unfair and
unnecessary. Local governments are in a unique situation at
these co-disposal sites. First, municipal solid waste and
sewage sludge collection and disposal is a governmental duty.
It is a public responsibility to our communities that we cannot
ignore, and we make no profit from it.
Second, the toxicity of municipal solid waste and sewage
sludge has been shown to be significantly lower than
conventional hazardous waste, and as such represents only a
small portion of the cleanup costs at these co-disposal
landfills.
The city of Glen Cove has experienced the threat of costs
and delay associated with these Superfund issues on a more
broad basis. I said we're located on the north shore of Long
Island. Glen Cove has 10 miles of beautiful waterfront, of
which 9 miles are beautiful, pristine property with 300 acres
of nature preserves, 3 public beaches and beautiful Gold Coast
mansions. At one time, J.P. Morgan lived in our city, F.W.
Woolworth lived in the city of Glen Cove. It cost $2 million to
build his staircase in 1917.
The city of Glen Cove is of course now a very diverse city
with the very wealthy, the very poor, and everyone in between,
with hundreds of units of public housing, $2.8 million in
Section 8 housing.
One mile of our waterfront, as I mentioned, there's ten
miles of waterfront, one mile of our waterfront is the original
industrial area of the city that is now home to Superfund
sites, State and Federal, and several brownfield sites. The
best example I give is of the LiTungsten plant, which is now
home to contaminated low level radioactive waste. At one time,
LiTungsten was the largest job provider in the city of Glen
Cove, the largest taxpayer. They gave money to the local Little
League baseball teams. They gave money to the local hospital.
Now that property sits there, abandoned and dangerous,
polluted. No jobs, no taxes, no support for the local community
and drawing away from the health and safety of our residents
and our reputation. This contamination, including the dumping
of radioactive and hazardous waste at an adjacent site, there
was once a municipally owned open dump, is now part of that
Superfund site.
Our objective is to recycle and reuse these properties and
put them back to productive use and make it into a regional
tourism destination, the main spot between Manhattan and the
Hamptons. The process of resolving the city's Glen Cove
municipal liability at this site has taken many years and many
dollars.
In addition to the sites I have mentioned, at a different
Superfund site, the Kin-Buc Landfill in New Jersey, the city of
Glen Cove was sued by industrial polluters seeking an unfair
share of contribution because our city had transported
municipal trash to that site. The legal process was likewise
lengthy and costly.
That's why Glen Cove supports legislative enactment of a
municipal Superfund liability policy that will provide a
simple, expedited and fair method of resolving a local
government's liability associated with these co-disposal
Superfund sites.
Again, the city of Glen Cove has been recognized as one of
only 16 national showcase brownfields communities for its
proactive effort to clean up and redevelop its contaminated
waterfront, and will continue to do so. However, the cost and
delay associated with the threat of Superfund co-disposal
litigation has hindered communities across the Nation like Glen
Cove from focusing their energy on the vital cleanup, reuse and
recycling initiatives that we need to be pursuing.
Indeed, there is a broad consensus that municipalities need
and merit liability relief. For nearly a decade, our coalition
has worked with you and other Members of Congress and with the
U.S. Environmental Protection Agency to formulate a reasonable
solution to the problem. In February, 1998, with our support,
the EPA finalized an administrative settlement policy to limit
liability under Superfund for generators and transporters of
municipal solid waste and sewage sludge and for municipal
owners and operators of co-disposal landfills.
We continue to support this reasonable and fair EPA policy
and commend EPA for playing a proactive role in seeking to
address a very complicated problem. However, as fair and
appropriate as the administrative policy is, we strongly
believe that legislative action to resolve the municipal
Superfund liability issue is necessary and justified.
First, the EPA policy is only a policy, non-binding on the
agency and subject to change or challenge. Second, this policy
has been the subject of litigation and the real threat of
future litigation involving local government remains. While we
continue to defend the EPA policy in court, as we did in
Federal Court in 1998, and to advocate its use by our members,
we believe that a change in Superfund law to address this issue
is necessary to reduce the costly litigation and delay that
municipalities may continue to face at these co-disposal sites.
Third, we believe legislative enactment of the municipal
Superfund liability provisions will give localities the
certainty and confidence to make use of this settlement
mechanism, much as the codification of lender liability
Superfund provisions have provided certainty for the banking
industry.
Senator Chafee. Mayor, I wonder if you could just summarize
these last points that you've got here. Your entire statement
will be in the record.
Mr. Suozzi. Let me just say that it's very important that
we get some work done this year, Senator. My comments can be
submitted to the record for your reading. The main issues have
to do with these co-disposal liability provisions, and second,
money for brownfields assessment and remediation and
identification, as Mayor Marshall pointed out earlier.
I want to thank you very much for the opportunity to
testify.
Senator Chafee. I'm familiar with your city, my wife comes
from Bayville.
Mr. Suozzi. Really?
Senator Chafee. Yes.
Mr. Suozzi. Well, come by and visit us. I'll give you some
up-front testimony. Have you been back to visit at all?
Senator Chafee. Yes, I've been down there lots of times.
Mr. Suozzi. Oh, please stop over and say hello. I'll give
you the grand tour. We'll take you to F.W. Woolworth's mansion
for lunch.
Senator Chafee. That must be some staircase he's got there.
[Laughter.]
Mr. Suozzi. We're afraid to walk up it sometimes.
Senator Chafee. I want to thank both of you very much for
your testimony. I think your points are very valid ones. Mayor,
I think you're right when you say the municipalities are
reluctant to list their contaminated sites. They just don't
want to do it.
So what we see in reports and indeed in the material you
submitted is just a cursory view of the whole thing. It's much
more serious than even your statistics would show.
Mr. Marshall. That is certainly true, Mr. Chairman.
Senator Chafee. Senator Baucus, do you have a question?
Senator Baucus. Yes, I want to compliment Mayor Suozzi for
your bipartisan tone in your statement. I appreciate it very
much.
Mayor Marshall, I am curious as to how we can get at this
problem. What's the solution? That is, where a city has sites
and wants to clean up on its own pretty much, worried about
potential NPL listing, what the EPA might do. How do we get at
this? It's a very real problem, obviously, so how do we solve
it?
Mr. Marshall. Senator, I think the problem goes well beyond
the NPL issue. And our focus is on brownfields. In many
instances, most, all but 1 percent of the brownfields, I'd say,
don't merit NPL listing.
But you have sellers who know that given the circumstances
of the land around the particular area, know that this land
isn't going to command the market value that will justify the
threat of potential substantial cleanup costs and litigation
costs, etc. So they may not even fence it, they'll just let it
sit there.
Now, how do you get past that? I don't have the answer to
this. The provisions of the different bills that I have seen,
and I haven't read the bills themselves, I've simply been given
summaries as a mayor, and I'm the CEO, it's a strong mayor form
of government, I've got a ton of things to do. So I can't claim
to have the kind of expertise that you all have.
Giving innocent purchasers relief will help somewhat.
Giving finality, that helps a lot. I can tell you, that helps a
lot. Because at least the parties going into a transaction know
that at some point, they'll understand what the exposure is and
they won't have to worry about some change on down the road. So
that's very helpful also.
But that doesn't address what I consider to be hundreds
upon hundreds upon hundreds of thousands of acres that are
simply going to sit there because the seller is not interested
in finding out that he or she or it has cancer. It kind of
knows, because it knows the past history of the property, knows
also that the economics probably won't justify the potential
cleanup costs.
So all I do is I use an analogy to what we do, where
substandard housing is concerned. We do systematic code
enforcement. We go block by block, we look at the exterior
properties. If the exterior justifies it, we'll knock on the
door, see if we can inspect. We have not yet gone to get a
warrant to inspect a house, but we would do that if need be.
Once the owner of the house is cited for a violation, that
starts a process that leads to the house being cleaned up and
maybe being put back on the market.
Senator Baucus. What do you do in the exceptional cases--I
think we have to at least consider this question--when the
local community decides to go ahead, clean up, and under some
structure where there is no liability for the landowner or the
seller or the purchaser, but where, oh, my gosh, it turns out
that we have another Love Canal on our hands? What do we do in
those cases, where I think justifiably, the EPA would figure,
this is an NPL site, or this is something that warrants Federal
intervention? How do you handle those exceptional cases?
Mr. Marshall. If you're asking, and I'm not familiar with
Love Canal in detail----
Senator Baucus. Something went wrong that was unanticipated
at the time.
Mr. Marshall. At the time that finality was given.
Senator Baucus. Exactly.
Mr. Marshall. Parties didn't see, well, frankly, I think
that's a risk we're going to have to take. And you might want
to distinguish between old cases that have already been
resolved by State environmental protection agencies or by the
EPA, and say with regard to those old cases, no, we're not
going to give finality. Because under the regime that existed
at the time the parties dickered through this particular
problem, be it Love Canal or the site in Denver I've heard
about, finality was not an issue. We could go ahead and agree
and know that we could come back later and do something here.
Distinguish between the old cases and new cases. If you
started effective the date of the legislation, the effective
date of the legislation and went forward, and whenever State or
Federal EPA-EPD cuts a deal with a potential purchaser and
says, this is what you're going to be expected to do and that's
all you're going to be expected to do, I would think that, take
the chance, and give finality in those instances. Because the
payback to all of us will be far greater than the few instances
in which EPD-EPA will make a mistake and later worry about it,
you know, say, oh, my gosh, we shouldn't have done it that way,
really more cleanup is needed, or we capped it, we shouldn't
have capped it, we should have put trees out there, whatever it
is,
Knowing that finality attends the decision it seems to me
will cause the administrators to be pretty careful in making
that decision, and the risk is warranted, it seems to me.
Senator Baucus. It's an interesting question, and there's
no final solution to this one, obviously.
Mr. Marshall. So to speak.
Senator Baucus. In the sense that if there were some huge
exceptional case, that would not be the end of it. It would not
be final. Somebody would file a lawsuit, and we'd be back in
the soup again in some way or another.
So I'm just trying to find some way to achieve your
objective of certainty, but at the same time, in some
reasonable way, I'm not saying----
Mr. Marshall. Well, I guess my thought, Senator, and it's
just off the top of my head, is that going forward, not going
back, but going forward, administrators knowing that finality
attends the decision, it seems to me, would be more careful in
making the decision. And then if they made a mistake, it seems
to me that there would be some cost that might wind up being
borne by the Federal or State Government to do additional
cleanup work, because there's nobody there to go after at that
point.
Senator Baucus. I understand that. But I think that still
there should be some criteria, some something at the front end,
I don't know what it is.
Mr. Marshall. Before you can give finality?
Senator Baucus. Before there is finality.
Mr. Marshall. And that is well beyond my ability to do.
Senator Baucus. Thank you.
Senator Chafee. Senator Voinovich.
OPENING STATEMENT OF HON. GEORGE V. VOINOVICH,
U.S. SENATOR FROM THE STATE OF OHIO
Senator Voinovich. First of all, I apologize for being late
for the beginning of the hearing, Mr. Chairman, and I ask that
the statement I was going to give be inserted into the record.
Senator Chafee. Without objection.
[The prepared statement of Senator Voinovich follows:]
Statement of Hon. George V. Voinovich, U.S. Senator from the State of
Ohio
Mr. Chairman, I'd like to take the opportunity to thank you for
conducting this important hearing today on Superfund. I commend the
leadership and work that you and Senator Smith have done on this issue.
I strongly believe that the current Superfund law is in need of
commonsense reform, as it creates delays in the cleanup process and
loss of available funds due to excessive litigation. I support the
liability relief that your Superfund Program Completion Act provides
for municipalities, small businesses, de minimis contributors,
contiguous property owners and prospective purchasers.
In addition, I strongly support the intention to reduce the state
cost share to 10 percent across the board for both capital costs and
operations and maintenance costs at NPL sites.
Of particular importance to me are the provisions that allow states
to release parties that have cleaned up sites under state laws and
programs from Federal liability.
I strongly concur with your approach that there should be no
requirement that U.S. EPA pre-approve state laws and programs. State
brownfields programs address non-NPL sites where the Federal Government
has played little or no role.
States are leading the way to cleaning up sites more efficiently
and cost-effectively. States average more than 1,400 cleanups per year.
And they are addressing approximately 4,700 sites at any given time.
This is helping to revitalize our downtowns, prevent urban sprawl
and preserve our farmland and greenspaces. These programs are cleaning
up eyesores in our inner cities, making them more desirable places to
live. Because they are putting abandoned sites back into productive
use, they are the key to providing jobs to inner city people and
keeping them off welfare.
Ohio has implemented a private sector-based program to clean up
brownfields sites. Ohio EPA, Republicans and Democrats in the Ohio
Legislature and I worked hard to implement a program that we believe
works for Ohio. Our program is already successful in improving Ohio's
environment and economy.
Mr. Chairman, I would especially like to make one thing clear
today. I understand that Ohio's voluntary cleanup program has been
portrayed to Members of Congress, even to this committee, as an example
of a bad state program that demonstrates the need for Federal oversight
of state voluntary programs. I could not disagree more.
In almost 20 years under the Federal Superfund program, U.S. EPA
has only cleaned up 15 sites in Ohio. In contrast, 77 sites have been
cleaned up under Ohio's voluntary cleanup program in 4 years. And many
more cleanups are underway.
States clearly have been the innovators in developing voluntary
cleanup programs. And Ohio's program has been very successful in
getting cleanups done more quickly and cost effectively. For example,
the first cleanup conducted under our program the Kessler Products
facility, near Canton was estimated to cost $2 million and take 3 to 5
years to complete if it had been cleaned under Superfund. However,
under Ohio's voluntary program, the cost was $600,000 and took 6 months
to complete. These cleanups are good for the environment and good for
the economy.
In particular, I would like to respond to the criticism that Ohio's
voluntary cleanup program does not provide adequate opportunity for
public participation. This is just outright false. Ohio carefully
crafted its program to balance the needs of public participation, but
not allow for significant delays in the cleanup process.
The Ohio legislature drafted and debated the legislation which
governs Ohio brownfields cleanup. The Ohio EPA then provided public
hearings when it set the cleanup standards that ``standard'' sites must
comply with under the law. For more complicated sites, or sites that
require air or water discharge permits, the state follows the public
participation procedures outlined in the Federal and state laws
regulating the issuance of permits. The public is involved in setting
the levels permitted to be discharged.
In addition, documents used or developed in connection with a
cleanup under the program are retained for at least 10 years and are
available to the public on request. Anyone may challenge the Director
of Ohio EPA's decision that a site is or is not clean enough.
Mr. Chairman, these are just a few examples. I ask that a summary
of the public participation opportunities under Ohio's voluntary
cleanup program be submitted for the record along with a copy of my
written statement.
Mr. Chairman, Ohio and other states have very successful programs
that cleanup sites more efficiently and cost effectively. S. 1090 would
help build on their success by providing parties assurances that when
they clean up a site correctly, they will not be held liable under
Superfund further down the road. This bill creates incentives for more
parties to come forward under voluntary cleanup programs to clean up
sites and put them back into productive use.
I look forward to today's hearing.
Senator Chafee. In commenting about the question just
asked, I think one of the things that is forgotten about in all
of this is the enthusiasm that local governments have for
cleaning up this wasteland that's out there, not only from an
environmental point of view, but also from the point of view of
ridding the city of blighted areas that really add nothing,
that have the potential of attracting businesses to them and
creating jobs, jobs that are needed, particularly in a lot of
our urban areas as we try to move people off the welfare rolls
to a job. The impact that it has on urban sprawl or the issue
of farmland preservation.
It just seems that in the last several years, States and
local communities have really got the spirit. From our
perspective, or my perspective, it seems to me to be that the
Federal Government, instead of trying to be a partner and
moving the process along in so many instances becomes an
impediment to moving forward.
I would think that in response to Senator Baucus' comment
on that, that you have State legislators that have passed
legislation dealing with brownfields, they've been thoroughly
discussed in the assemblies of the States, the Governors have
had involvement, their EPAs have had involvement, the laws are
passed, the State environmental protection agency then goes
about setting rules and regulations that are subject to public
hearing and so forth.
Once that's done, it seems to me that you ought to be able
to move forward and get on with it. I think that what we're
trying to do with this legislation today is to make that
possible.
Would either one of you want to comment about any
difficulty that you've experienced in moving forward because of
the Federal involvement?
Mr. Suozzi. I think you're 100 percent on in your analysis,
Senator, about what the importance of this issue is, that we
not only want to clean up the properties, we want to attract
economic development and we want to stop developing the green
fields that are out there. I mean, in Long Island, every
developer that wants to build a new building of some type, they
look for an old potato field or something like that, or an old
estate property or an old open space to build a new office
building or factory or stores.
So we've got to recycle and reuse these properties. One of
the first steps that we need to do, as Mayor Marshall has
talked about, is to assess where these problems are and
identify them and try and market them and point out that the
problem may not be as bad as everybody thinks it is. And to do
that, the main thing that we need is money in the form of
grants to help us do brownfields assessment. That's something
that's very important to us at the local level.
I've found the Administration has been trying very hard
through the EPA to work with us through different programs, but
we still need more help.
Mr. Marshall. Senator, it's interesting, I know a lot about
the problem, but I can't claim to have a lot of personal
experience, and I'll tell you why. It's because Macon, middle
Georgia, suffers from the same sprawl problem that Atlanta and
any number of other cities suffer from. The economics
associated with these inner city tracts that absolutely need to
be redeveloped, they're sitting right in the middle of all
kinds of neighborhoods where people need jobs, the economics
simply don't justify much effort.
I used to represent banks, I'm a law professor, commercial
lawyer who became a mayor. I used to represent banks. When I
became the chairman of the Mayors and Bankers Task Force, one
of the first things I did was call all the bankers, all the
presidents of all the banks in the city together for breakfast
to talk about this. Most didn't know what a brownfield was,
they had never heard the term. This was only a year ago.
And it's because the market forces make it so much easier
for lenders to do cookie cutter deals in office parks and what
have you on the periphery than to try and deal with this
problem in the heart of the city.
Now, is it the Federal, the threat of Federal involvement
and Federal liability? In part, yes. And I have worked with a
couple of parcels in the inner city, mostly with State
environmental folks. I can tell you lenders want certainty,
they want finality. They don't want to get involved in a deal
where they could wind up getting stung later on or not being
able to foreclose on the property because some additional
cleanup work might have to be done. So they're not interested
in even thinking about a complicated deal like that, let's do
it on the periphery.
So I think there are other factors, there are other forces
that explain this phenomena besides just this one. But this
force, this factor, environmental laws that make it difficult
to purchase and difficult to have certainty with regard to
these inner city properties that already have all the
infrastructure and people needing jobs surrounding them, those
laws, yes, are a specter that hang over the entire country.
In Chicago, the economics may justify a deal. Glen Cove,
you've got a staircase, if I understood you correctly, Mayor, a
staircase in Glen Cove that's equal in value to the public
housing in Glen Cove. We don't have anything like that in
Macon.
[Laughter.]
Mr. Marshall. But Glen Cove, the economics may justify it
there. In most of the cities, they don't. So you're going to
have a lot of property that lies fallow in the heart of the
city.
And here I am, I'm a typical, modern day American
businessman, and I come to middle Georgia, and middle Georgia
is trying to persuade me to put my office park in the old
industrial district. I drive through that district, and what do
I see?
Well, I don't see what you normally see in modern office
parks. I don't see nicely mowed grass and buildings set back a
certain distance. What I see is vacant lot after vacant lot, a
crumbling structure. I'm not going to put my business down
there.
So that's the problem we've got that needs to be reversed.
A lot of factors, the environmental law is just one of the
factors, sir.
Mr. Suozzi. And again, the market forces themselves that
the mayor refers to are the market forces created by the laws
that make it so difficult to clean up these sites and reuse
these sites. My property, but for the pollution that I'm
talking about, is on the north shore of Long Island, 60 acres
of beautiful waterfront property. But for the pollution and the
laws that go into cleaning up that pollution and the finger
pointing that we must go through to get through the process,
that property would be very valuable.
But it's because of the uncertainty, it's because of the
difficulty of navigating the maze of legislation that makes it
so invaluable. Similar to these city tracts in inner cities,
these are, right as the mayor pointed out, near to centers of
infrastructure, near major employment forces, very attractive
properties but for the problems associated with the laws.
Senator Chafee. Senator Lautenberg.
Senator Lautenberg. I thank you, both mayors, for your
testimony. I am not familiar with Macon, but I am with Glen
Cove. It is truly a beautiful town, and it wasn't my
grandparents who lived in those big houses, I can assure you.
But it's a beautiful coast line.
New Jersey unfortunately happens to be one of the places,
we have the largest number of Superfund sites in the country.
At the same time, New Jersey has the second highest per capita
income in the country. It's kind of a paradox, we have some
very poor and we have some very successful people.
But the cleanup of brownfield sites has had a dramatic
effect in the communities in which it's worked. I have
witnessed it personally.
I would mention to both of you, though, that we're looking
at a Superfund bill in its totality here. While the focus, I
think from each of you, has really come to the brownfields
area, Mayor Marshall, I couldn't help but notice in your
testimony that you had a general concern, serious concern about
the proposed termination of the Superfund program at this
juncture and the absence of a plan to reinstate the feed stock
taxes.
I recall that simply to remind everybody that there's a
much larger picture here. How do you feel, for instance, about
ramping down the number of sites, slowing down the cleanup of
Superfund sites generally? Is that something that you would say
is an appropriate way to conduct the environmental requirements
of your community, of our country?
Mr. Marshall. Senator, we have in Macon a, it's either an
NPL site or it's a Superfund site, it's an old naval ammunition
manufacturing facility that is now held by an authority of the
city. I think ultimately the Corps of Engineers is responsible
for cleanup, but no funds have been allocated to take care of
the problem, so the site simply sits there.
I don't know that that site is causing us a great deal of
grief. It's located in the heart of an older industrial park.
It's not near neighborhoods and etc.
Do I want the site cleaned up? Obviously. If funding, if
changing the Superfund law means that there won't be funds to
clean up this site, then obviously I'm interested in not
changing the law and having the funds.
But the question you asked us to comment on is one that's
way beyond our scope of expertise and our perspective. I would
comment, though, sir, that to say that what we're talking about
is a small part of a bigger problem, may understate the size of
the part that we're talking about. I think you have the problem
I described, and Mayor Suozzi described, affecting literally
hundreds of millions of people int eh United States in a very
negative way.
You do have significant national priority Superfund sites
scattered around the country, and we know some of the names,
Love Canal, etc. I'm familiar with one that may be that kind of
site in my community. But I can tell you, that site doesn't
have as dramatically a negative impact upon the economics of
the community as all these brownfield sites do. And if you
accumulate the negative economic impact of having all this land
lie fallow inside our center cities, I think you'll conclude
that it's a huge problem, not a small problem.
It may be necessary for the two to be separated, and for
somehow, in a bipartisan way, Mr. Chairman, for this committee
to move forward with some brownfields relief, if it can't do
the Superfund part of this. I don't know. I just don't know
enough about this stuff. But I can tell you, it's not a small
problem.
Senator Lautenberg. I don't think I used the word small in
any way, because I am an original author going back to the 103d
Congress of separate brownfields legislation. I've brought it
up every year, and every year it's been said to me, Frank,
don't do that here, let's tie that into the Superfund program
at large. And maybe that will help pull Superfund along.
I'll ask you, Mayor Suozzi, should we have a separate
brownfields bill to take care of the kinds of problems that
you've both talked about that would have an immediate impact on
the way our communities are functioning?
Mr. Suozzi. Let me just say that it's not important to me
whether it's separate or not separate. What's important is that
it gets done this year. We need some work done on brownfields
right away, because it's affecting us very dramatically. We
think it's something that everybody can agree on. It's not a
controversial area, it's something that there is bipartisan
consensus on, and it's important that we get it done as soon as
possible, because it's affecting us very seriously.
Senator Lautenberg. Well, you've described it in terms,
well, it's a simpler problem to digest, it looks like a simpler
one to solve. Then I think you confirm the fact that we ought
to get on with, regardless of what we do with Superfund, and I
frankly am one of those who doesn't think that we ought to cap
the number of sites we're going to do, I don't think that we
ought to slow down the pace.
Superfund has been a very successful program. It took a
long while to get developed and to get started, but it's been
successful. Ninety-five percent of the sites have either had
cleanup starts or remedy solutions produced. And so I want to
work cooperatively with my friends on the other side to try and
get something done. But what I get from both of you is get on
with the brownfields.
Mr. Suozzi. And with co-disposal landfill relief.
Senator Lautenberg. I heard that. I'm with that. It's a
universal problem as well.
Senator Chafee. OK, Senator Crapo.
Senator Crapo. Thank you, Mr. Chairman. I have no
questions.
Senator Chafee. Fine. We want to thank the panel very much.
Senator Smith. Mr. Chairman?
Senator Chafee. Oh, excuse me.
[Laughter.]
Senator Chafee. I apologize, Senator Smith.
OPENING STATEMENT OF HON. ROBERT SMITH,
U.S. SENATOR FROM THE STATE OF NEW HAMPSHIRE
Senator Smith. Sorry I was late. I know you have other
panels. Just a couple of points.
Senator Lautenberg, I wasn't here when you spoke, but I
know that you mentioned that reopening old settlements creates
problems. In S. 8, that was in the old S. 8 Superfund bill last
year. That was a serious problem and difference between us.
But I think you'll find if you look at S. 1090 that we have
addressed that. It's not in our bill, there's no language on
reopening old sites. So I might ask you to just take a look at
that.
Another comment, you know, as I read your testimony, Mayor
Marshall, and you talk about State finality, which is really
where I'm coming from. You testified ``This issue continues to
be driven by seemingly abstract debates about unreasonable
constraints on EPA's role. Under existing law we know that EPA
has rarely, if at all, intruded upon State decisions on non-NPL
or non-NPL caliber sites. The price of keeping EPA over-
empowered in this area is simply too high.''
I agree, and we're not going to be able to deal with
brownfields, Superfund or anything else without State finality.
Just reviewing, I'm going to ask a question here, but just in
reviewing, if you think of the bill, when it passed in 1981,
the so-called Superfund law, I will grant to you that there
have been some successes, very costly successes, $35 billion or
$40 billion over the last 15 years in the program. I don't
think the bang for the buck has been there, to put it mildly.
But when you think about why you ride down that street and
see those deserted locations where your businesses don't want
to go, it's no wonder when we had lender liability, when
somebody wanted to go clean up that site, the lender was held
liable. We had contractor liability, so if anybody in there
tried to clean it up, they were held liable.
We also had abutter liabilities, so if any of this stuff
moved over to the next door neighbor, he was liable. We also
had every purchaser in the chain of title liable. We had joint
and several liability, so that if you only owned 10 percent of
the site, you had to pay 100 percent of the site if they
couldn't find the other guys.
And we wonder why these things, I mean, the reason these
sites have not been cleaned up is because of Superfund, period.
That's why we need to change this all, and that's why we need
to link, with all due respect, Senator Lautenberg, that's why
we have to link brownfields with Superfund reform. Because it
doesn't make any sense to move in one area and not in another.
Because brownfields could at least have the potential to be
``Superfund sites,''and that's what we're trying to stop.
That's why we have spent a lot of time trying to reach
accommodation here where the differences are, but at the same
time, keeping fairness, fairness, as the major yard stick here,
not to be unfair to one and fair to somebody else, but fairness
and orphan shares is the only way to bring fairness into the
system and to deal with these other liability problems.
Let me just ask a specific question, and we'll move on. In
our bill, in this bill, 1090, we do four things as it relates
to the State. I would just ask each of you to comment on the
four. I'll just read the four and you can go back and comment.
It allows EPA to act at a State site in the following
situations. In other words, EPA can step in in your State under
the following situations in this bill, and only under these
situations.
No. 1, in an emergency. Something happens, we don't know,
we can't predict, there's an emergency. It can act second only
at the request of a State if there's no emergency. Third, if
the State's remedy fails and the State is unwilling or unable
to respond, EPA can act. And finally, if contamination has
crossed a State line which gets into interstate matters. That's
it.
Do either of you have any problems with any of those four
points in the legislation at hand?
Mr. Marshall. You asked a very narrow question, do I have a
problem with that. I don't know enough to know whether I should
have a problem with that.
I can say that my opinion is, having the State EPD have the
authority to give final determination in many, many instances,
is something that would be very helpful. And right now, when
you talk with, and I've had very limited personal experience
doing this, but I have done it, when you talk with the
principally responsible agency for dealing with brownfield
cleanup problems in the city of Macon, it's the State. You say
to the State, OK, we worked this out, is that it.
The State can't bind EPA. And you can't get, you can get a
comfort letter, I think is what it's referred to, from EPA,
that this probably won't be a national priority site. But you
can't get the kind of comfort that lenders would like to have.
It seems to me if there is a way to limit EPA's role or at
least give States the freedom to give finality to a certain
matter and that's it, that would be a big step forward as far
as dealing with a lot of these problems are concerned.
Mayors feel that the brownfield problem is by far the
larger, more significant economic problem, long term
environmental problem, facing the United States right now, even
though brownfields typically don't have the level of
contamination, they don't come even close to the kind of
contamination that the more specific Superfund sites look at.
Senator Smith. But the issues are the same, finality,
liability.
Mr. Marshall. Right. If there's a way to separate the two
and give finality readily in a brownfields setting, and then if
later on you find out that you made a mistake and finality was
a bad idea, it was a mistake to have granted finality, maybe
somebody at the State or Federal level is going to have to bear
some additional cost.
It just seems to me that the economic value of being able
to provide finality to thousands and thousands and thousands of
deals and the effect on the economics of a city is so positive
that you take a chance on making a mistake. You go ahead and
give the State actors the opportunity to make some of those
mistakes. And you move forward and you make decisions. And then
you go on.
Now, exactly how you do that, I don't know. I can tell you
that cities across the country, mayors across the country, sort
of feel like they're being held hostage in this debate. It
would be nice if a bipartisan group would come together and we
could get something done this year that would give some
brownfields relief.
[The prepared statement of Senator Smith follows:]
Statement of Hon. Bob Smith, U.S. Senator from the State of New
Hampshire
Thank you, Mr. Chairman. I'd like to welcome the witnesses here
today, particularly those who traveled some distance to be here.
Several of you are taking time from pressing duties in state or local
government. Others have taken valuable days off from their businesses.
We appreciate your presence here today. Mr. Chairman, we do have a
large number of witnesses who have important testimony to provide, so I
will keep my comments brief.
This committee is now in the seventh year of serious work on
Superfund reauthorization. During the 4 years of my tenure as chairman
of the Superfund Subcommittee, we and our staffs have spent hundreds of
hours negotiating issues and identifying areas of agreement with our
Democratic colleagues on the committee and with EPA Administrator Carol
Browner. In the markup of S. 8 in the last Congress, we succeeded in
eliminating many areas of controversy, but were still left with several
major disagreements over remedy selection and fair liability reform,
among others.
At the beginning of this Congress, Administrator Browner and Acting
Assistant Administrator Tim Fields testified that EPA was interested in
pursuing legislative reform only in some narrow property owner areas
and in brownfields. They still seek the Superfund taxes, but have
abandoned efforts at the comprehensive reform that would justify those
taxes. Their message was that the Superfund program was ramping down
and that major reforms would impede that process.
At the same time, several of our colleagues expressed strong
concerns about how much we would have to give up in remedy, liability,
and natural resource damage reforms in order to win the support of the
Administration. They share my view that taxes should not be reimposed
on American businesses to support a fundamentally unfair program.
In the face of those legitimate concerns on our side, and
confronted with EPA's change of position on the other, Mr. Chafee and I
decided to try a different course. With the introduction of the
Superfund Program Completion Act last week, we have taken off the table
reforms in natural resource damages, remedy selection, and full
fairness in liability--along with the taxes. Instead, we focus on major
reforms in six areas.
Specifically, the Superfund Program Completion Act:
Directs EPA to finish the job that was started nearly two
decades ago by completing the evaluation of the remaining sites on the
CERCLA Information System (CERCLIS).
Clearly allocates responsibility between states and EPA
for future cleanups.
Protects municipalities, small business, recyclers, and
other parties from unfair liability--while making the system fairer for
everyone else.
Provides states $100 million per year and full authority
for their own cleanup programs.
Revitalizes communities with $100 million in annual
brownfields redevelopment grants.
Requires fiscal responsibility by EPA and saves taxpayers
money.
Our legislation will result in more hazardous waste sites being
cleaned up--and in fewer dollars being wasted on litigation. It will
give much-needed and much-deserved liability relief to innocent
landowners, contiguous property owners, prospective purchasers,
municipalities, small businesses and recyclers. Unlike EPA's
administrative reforms, this bill does not shift costs from politically
popular parties to those left holding the bag. Instead, it requires
payment of a statutory orphan share and authorizes the use of the
Superfund Trust Fund for those shares.
Unfortunately, EPA wants to have it both ways on the issues of
substantial reform and taxes. On the one hand, they tell us that
substantial reform is not needed because the program is ramping down.
At the same time, they claim they must have taxes reimposed. Worse yet,
according to the testimony Acting Assistant Administrator Fields gave
last month, EPA intends to use those taxes to continue its ventures
into the commercial real estate business--building golf courses with
Jack Nicklaus. Let me be clear on this: I will never support requiring
taxpayers to pay even one penny for an EPA golf course.
The only way I will support reimposing taxes is if the funds are
used to pay for full reform of the Superfund program. I pledge to
continue working for full reform of the program, but I firmly believe
we must do what we can in this Congress. The Superfund Program
Completion Act is achievable, strong reform.
Thank you, Mr. Chairman.
Senator Chafee. We've got to move on. Mayor Suozzi.
Mr. Suozzi. I just want to echo that again. I'm here about
brownfields, and I'm here about co-disposal landfill relief.
The issues you point to are very important, Senator. One big
problem that small municipalities like mine, as well as large
municipalities, is having to navigate the maze of so many
overlapping jurisdictions on different issues.
It's very difficult, I'm a city of 25,000 people, we're
busy picking up the garbage and making sure the cops do their
jobs and paving the roads. These are big, complex issues for us
that are really overwhelming at times, which is one of the
reasons we need help with funding. Private parties just aren't
going to do it. It's just too much of a headache for them to
get involved.
We've got to take a leadership role, and we don't have the
resources to do it. We need help on something we know is
clearly definable right away, which is the brownfields issue.
It would provide tremendous economic and environmental benefit
to a lot of people.
On the issue that you talk about specifically, it would be
great if we could get the States and the Federal Government
together, and it would be great if we could get the Democrats
and the Republicans together with a solution on this issue. But
if it's going to hold up everything else, then I'm not in a
position to comment on it, because I'm not educated well enough
on the issue.
But we're having a hard time out here. We just want to do
the right thing, we want to do our jobs as government, which is
provide the infrastructure, provide the opportunity for people
to make private investment. We need your help to get that done.
Senator Lautenberg. Mr. Chairman?
Senator Chafee. Frank, you can make a quick comment, but
we've spent 1 hour on two witnesses. We have 11 witnesses to
come.
Senator Baucus. Mr. Chairman, that's true, but the Senators
have not spoken nearly as long as have the witnesses.
Senator Lautenberg. And I've been on especially good
behavior.
Senator Chafee. I'm not sure I'd mark that, but I guess I
would give you a high----
Senator Lautenberg. I'm listening.
[Laughter.]
Senator Chafee. All right, go ahead, quickly, please.
Senator Lautenberg. I just want to respond to Senator
Smith's comment about not reopening. As a matter of fact, if
the bill does require allocations that would be, that EPA might
have already made, and not taken care of some unaddressed
costs, which would allow the subject to be reopened and
reallocated if that's a determination. Is that not true?
Senator Smith. I'd like to see the reference on that.
Senator Lautenberg. Section----
Senator Smith. You're talking about unaddressed costs. If
they're not addressed, they're not reopened.
Senator Lautenberg. Page 77. Well, it says, shall include,
list facility not addressed in the settlement or before the
date of enactment, not later than 180 days.
Senator Smith. Not addressed, etc.
Senator Lautenberg. But EPA has to do an allocation at all
sites. Go back and look at any unaddressed costs.
Senator Smith. Well, they're addressed. If they're
allocated, they're addressed. This is not addressed. That's
what we're saying. I think you're misreading it.
Senator Lautenberg. Well, at least we know that there's an
open question.
Thanks very much, Mr. Chairman.
Senator Chafee. All right, gentlemen, thank you very much
for coming. We appreciate it, and safe journey home, both of
you.
Mr. Suozzi. Senator, again, I want to invite you and Mrs.
Chafee down to Glen Cove, come down to her old home ground some
time and see our redevelopment project.
Senator Chafee. We were married in Oyster Bay, how's that?
Mr. Suozzi. Great. Come down and I'll re-perform the
ceremony.
[Laughter.]
Senator Chafee. OK, thank you very much.
Now let's have the next panel step right forward, please.
Mr. Tom Curtis of the National Resources Governors'
Association; Claudia Kerbawy; Gordon Johnson; and Vernice
Miller.
Mr. Curtis, go ahead.
STATEMENT OF TOM CURTIS, DIRECTOR, NATURAL RESOURCES GROUP,
NATIONAL GOVERNORS' ASSOCIATION
Mr. Curtis. Thank you, Senator Chafee. Good morning,
Senators, Senator Baucus, other members of the committee.
My name is Tom Curtis, I'm here representing NGA this
morning. I'll introduce my statement for the record and
summarize very succinctly for you.
I would like to start by saying that the National
Governors' Association wholeheartedly agrees with the
sentiments expressed by the mayors on the first panel about the
importance of finality as a tool for returning brownfield sites
into productive use. There are thousands upon thousands and
thousands of such sites, probably hundreds of thousands of
acres of property around the Nation that is essentially
mothballed, because the owners have a pervasive fear of
liability under the Superfund program.
Under the current liability system, if such a property were
addressed even to the satisfaction of a State, EPA could
nonetheless apply the Federal liability scheme to the party who
is owning or attempting to return that site into use. The fear
of such liability without question hinders the redevelopment
and reuse of such sites. It is very important that the Congress
address that issue.
We think that your bill does so appropriately. You include
reopeners that we believe are appropriate for the case in which
there may be new information or a change of conditions at that
site, or the case in which a State requests EPA to come back in
to a site. Those reopeners, we think, are important and
appropriate.
But clearly, that is a significant issue of national
interest that the Congress has to address.
I would also like to speak to the provision in your bill
that requires an invitation by a Governor before a site can be
listed on the national priorities list. We believe that is a
very important provision. The States have matured enormously in
their programs. The State programs are now just as
sophisticated as EPA's program is, in many respects. EPA, by
the way, deserves a lot of credit for that. The EPA has
supported States over the years and helped States mature.
While EPA has probably made cleanup decisions or even
initiated construction at 90 to 95 percent of the sites on the
NPL, tens of thousands of sites lie off the NPL that are being
addressed by these very good State programs. It does not make
sense to have two masters at any of those sites. We believe
that where there's a Federal interest in a site, it should be
listed on the NPL. But if a State had the capability and the
desire to address any site, it should have the first choice,
and EPA should only add a site to the NPL with a clear
concurrence by the State.
Finally, I would close my remarks by commenting on a couple
of other provisions in your bill. We very much appreciate the
financial support for site assessment and for addressing sites
and for State brownfield and cleanup programs. We very much
appreciate the important provisions you have here to change the
State share of operating and maintenance costs to 10 percent.
We think that too is a very important piece of this bill, and
we urge you to maintain that.
I guess finally we would simply urge you to try to get the
bill done this year. As you know, Senator, the Governor's
Association is a bipartisan organization. Our policies can only
be adopted by a vote of two-thirds of the Governors and
typically are adopted by a much more impressive majority. Our
Superfund policy is such as policy, it was overwhelmingly
approved by the Governors. They don't come at this as a
partisan issue.
We urge all Members of the Congress, both sides of the
Congress, and certainly both sides of the aisle here, to reach
across the aisle in a spirit of bipartisanship, try to get the
bill done. We need you to send a bill to the President this
year that he can sign. Let's please work together.
The Governors stand willing to help you in any way that
they can to try to get that job done this year. Thank you.
Senator Chafee. Thank you, Mr. Curtis.
Ms. Kerbawy?
STATEMENT OF CLAUDIA KERBAWY, CHIEF, MICHIGAN SUPERFUND
PROGRAM; SPOKESPERSON, ASSOCIATION OF STATE AND TERRITORIAL
SOLID WASTE MANAGEMENT OFFICIALS
Ms. Kerbawy. Good morning, chairman and members of the
committee. My name is Claudia Kerbawy and I am Chief of the
Michigan Superfund Program and the primary spokesperson on
reauthorization of the Association of State and Territorial
Solid Waste Management Officials. I am here today representing
ASTSWMO.
As the day to day implementers of the State and Federal
cleanup programs, we think we offer a unique perspective to
this dialog, and we thank you for inviting us here.
ASTSWMO and individual States have participated in the
Superfund reauthorization debate for the past three Congresses.
I would like to dedicate the first part of my testimony to
speaking on the accomplishments of State programs which have
had 18 years to grow and mature into the leaders in remediation
today.
ASTSWMO recently conducted a study on removal and remedial
actions performed by States between January 1993 and September
1997. NPL sites, RCRA corrective actionsites, storage tank and
other petroleum sites were not included in the study. The
Association received information on 27,235 sites from 33
responding States. Information had to be site specific and had
to be accompanied by background data. Estimates were not
accepted or counted in the survey.
Results of the survey showed that those 33 States are
completing an average of 1,475 sites per year, for a total of
6,768 completions. They are completing an average of 485
removals per year, and are addressing on average approximately
4,700 sites at any given time. Only 8.9 percent of the sites
identified in the survey were classified as inactive.
Although this study does not capture the complete site
universe either on a national or individual State level, it
does confirm that on a national level, States are addressing
and completing response action at the bulk of the sites.
The next part of my testimony will be devoted to analyzing
key aspects of S. 1090 from a State program manager's
perspective. We support the provision for Governors'
concurrence with NPL listing as outlined in S. 1090. Most
identified sites in the State that could qualify for listing on
an NPL are already being addressed by the States.
While there may be 40 plus States that have Superfund
programs and voluntary cleanup programs, there will always be
sites which due to either technical or legal complexity or
cost, a State either cannot address or may prefer to have the
Federal Government address. The NPL is no longer reserved for
the worst of the worst sites, rather, the NPL has shifted to a
venue for remediating sites which require Federal resources.
The NPL should be reserved for those sites which both the
State and Federal Government agree warrant expenditure of
Federal resources as provided for in S. 1090.
States are responsible for remediating the vast majority of
sites in the country and must be allowed to determine when a
site is fully remediated. CERCLA technically applies to any
site where release occurs. However, the reality today is that
States are responsible for ensuring the remediation of all
sites which do not score high enough for listing on the NPL.
The EPA removal program is able to address some sites which are
not listed on the NPL, but the program is designed to stabilize
a site, not ensure that the site reaches full remediation.
EPA does not have the authority to expend fund money or to
require other parties to fund remediation at a site not listed
on the NPL. Although the majority of these typically brownfield
sites will never be placed on the NPL, they are still subject
to circle of liability, even after the site has met State
requirements.
We can no longer afford to foster the illusion that State
authorized cleanups may somehow not be adequate to meet Federal
requirements. The potential for EPA over-file and for third
party lawsuits under CERCLA inhibits brownfield cleanup and
redevelopment. States should be able to release both Federal
and State liability once a site has been cleaned up to State
standards. Legislation which addresses these issues, as does S.
1090, is critical.
We are also very pleased that S. 1090 seeks to streamline
the program by providing a fixed 10 percent cost share across
the board. Under the status quo, the financial incentive for
EPA and the States are diametrically opposed when considering
final remedies for a site. State waste officials believe that
S. 1090 presents a fair and well reasoned approach to this
issue.
Clearly, implementation of CERCLA over the years has
identified a level of unfairness in its liability system.
However, we will leave the analysis of the liability reforms in
S. 1090 to other State experts.
In conclusion, while our membership has not yet conducted
an in-depth review of S. 1090, or reached consensus on the
bill's language, the initial impressions and reaction from our
members is favorable. We are very encouraged and look forward
to working with the committee as the process continues.
Senator Chafee. Thank you very much, Ms. Kerbawy.
Mr. Johnson?
STATEMENT OF GORDON J. JOHNSON, ASSISTANT ATTORNEY GENERAL, NEW
YORK
Mr. Johnson. Good morning. My name is Gordon Johnson, and
I'm a Deputy Bureau Chief of the Environmental Protect Bureau
of the New York Attorney General's Office. I'm appearing today
on behalf of Attorney General Elliott Spitzer and on behalf of
the National Association of Attorneys General, NAAG. We very
much appreciate the opportunity to appear before the committee,
and we thank the chairman and staff of the committee for the
consideration and assistance.
NAAG has been deeply involved in the Superfund
reauthorization process for many years. At its summer meeting
in 1997, the sole resolution adopted by the Attorneys General
addressed Superfund reauthorization. A copy is submitted with
our written statement.
While the State agencies that administer cleanup programs
are very knowledgeable about the engineering issues involved in
selecting remedies in the cleanup process, it is the State
Attorneys General who can best evaluate the legal consequences
of changes to the current statutory scheme, such as how
amendments are likely to be interpreted by the courts and their
effect on enforcement, settlement and cleanup. We are pleased
that we will be able to bring to this committee our insight and
experience.
Although there were significant problems in the Federal
implementation of CERCLA during the 1980's, the current statute
is now getting the job done. In New York, because of the powers
provided in CERCLA, the State has obtained cleanups at over 600
hazardous waste sites. Responsible parties have contributed
more than $2 billion to site cleanups and two-thirds of the
sites are being cleaned by private parties.
Most States have had similar results. On a Federal level,
some $10 billion of public money has been saved because 70
percent of all remedial actions at Federal Superfund sites are
being performed by responsible parties. A major reason for this
success in the cleanup is that the cleanup liability under
CERCLA is now clearly understood.
It wasn't always this way. In the 1980's, there was
resistance and contentious litigation that caused delays in
cleanups, imposed substantial burdens on government programs
and increased everybody's transaction and cleanup costs. Now,
most PRPs understand the statute and are ready to settle their
liability with government.
EPA's practices also have evolved, resulting in early
settlements and the quicker implementation of remedial
decisions. State Superfund programs have matured, many of which
are modeled on the Federal program and use the Federal statute
to get appropriate cleanups at minimal taxpayer expense.
The message to us is clear. We must avoid changes to CERCLA
that will reignite the courtroom battles over the meaning,
scope and implications of the law. At the same time, we must
not lose sight of our primary goal, cleanup of sites and
protection of the public and future generations.
We are pleased to note that S. 1090 is a departure from
earlier bills. The bill contains some of the revisions that
have been sought by the States for years, such as the cap at 10
percent for the State share of remedy operation and maintenance
costs. S. 1090 is also selective in its reforms and does not
amend the remedy selection and natural resource damages
provisions of CERCLA to any great extent.
As a result, the defense bar will have fewer opportunities
for legal challenges than under earlier bills. We are pleased
that the bill includes a brownfields revitalization program and
allows States to give cooperating PRPs protection from
liability under certain circumstances, measures that will
assist States in implementing their voluntary and brownfields
cleanup programs.
Unfortunately, other needed revisions we have been seeking
for many years are absent, including, one, clarification of the
waiver of sovereign immunity regarding Federal facilities.
Federal agencies need to be treated the same as any other
liable party, and they still are not. Two, natural resource
trustees should be able to utilize the fund to perform natural
resource damage assessments. Three, the statute should make
clear that remedies selected by States are reviewed on the
administrative record.
There are still serious problems, nonetheless, with S.
1090's revisions to the liability and allocation provisions of
CERCLA. While NAAG supports limited exemptions from liability
for truly de micromis parties, and a reasonable limitation on
liability for municipal solid waste disposal, many of the
provisions of S. 1090 are unclear or go too far.
The proposed mandatory allocation process is unwise and
rather than making settlement easier and quicker, will
complicate and delay settlements and cleanups. Cleanups should
come first, not arguments.
Most critical, however, is the apparent de-funding of the
Superfund program which necessarily will shift hundreds, if not
billions of dollars in costs to the States. We all wish there
was no need for CERCLA and the Superfund program. But there is,
and there will be for many years. When EPA lacks the funds to
perform, the burden will shift to the States. There are enough
unfunded mandates for us already.
Finally, the new liability exceptions and the limits on
listing new sites will seriously erode the operation of the
Superfund program inevitably shifting the cleanup costs to the
States. Thank you for your attention.
Senator Chafee. Thank you.
Ms. Subra, we've pulled you up from a later panel. You're
from New Iberia, Louisiana, representing a company.
Ms. Subra. Yes, sir.
Senator Chafee. Why don't you go ahead?
STATEMENT OF WILMA SUBRA, SUBRA COMPANY, NEW IBERIA, LOUISIANA
Ms. Subra. Thank you. My name is Wilma Subra, and I work
with grass roots groups across the United States dealing with
Superfund issues. I have also served as the technical advisor
to the National Superfund Commission.
The Superfund Completion Act, as is presented here today,
would limit and weaken the Superfund program and result in
continued environmental damage and human health impacts from
sites that would not be allowed to be addressed by this
program. The bill limits the number of new NPL sites, it
reduces the level of funding for the program. It encourages
State programs to assume program responsibility in States that
lack the financial and technical resources as well as the
political will to carry out the program.
It also limits and in some cases eliminates entirely public
participation in the process. It discourages voluntary cleanups
by potentially responsible parties at sites prior to them being
listed on the NPL. It places at risk communities that live on
or new fund led sites where the remedies would only be
containment.
A containment remedy is currently being implemented by EPA
at the Agriculture Street Landfill Superfund Site in New
Orleans, Louisiana. The remedy is being paid for totally by
fund money. The landfill is 95 acres and was operated by the
City of Orleans from 1909 to 1965. Then the city, in
conjunction with HUD, developed 47 acres of that landfill as
private and public housing, a recreation facility and an
elementary school.
The containment remedy consists of removal and replacement
of two feet of soil and waste in only 10 percent of the
residential area. Only the exposed soil and waste areas will be
addressed, not that under the structures, under the streets and
under the sidewalks. When the remedy fails, and it will fail,
due to subsidence, shallow ground water and the area being
located below sea level, resources from the fund would not be
available under the proposed bill to finance the measures
necessary to fix the containment remedy.
This is just one example of the many sites where
containment was utilized at fund led sites, where the citizens
will lose in the long run when the containment remedy fails and
fund resources are not available to go back in and repair the
remedy. Those citizens are actually here in Washington right
now, trying to get relocated. They will be speaking with the
Appropriations Committee to see if they can come up with some
money.
The requirement that a Governor request a site be listed
will severely limit the sites proposed for NPL. Governors will
be reluctant to request that the EPA add sites to the NPL when
the potentially responsible parties at those sites are his
financial campaign contribution. The only sites a Governor may
request be added to the NPL are sites that are 100 percent
orphan. In States that lack financial resources or political
will, such orphan sites already fall to EPA to fund the
cleanup.
The requirement that a Governor request a site be added to
the NPL completely eliminates the ability of citizens to
petition to have sites listed. In the State of Louisiana, the
majority of the NPL sites were listed as a result of citizen
involvement. The elimination of the citizen petition process is
not appropriate. Allowing the State Governors to have the
ultimate authority over the listing of sites prolongs the
exposure of citizens living and working on or near the site and
citizens consuming aquatic and terrestrial organisms that are
contaminated by the site.
To States again that lack the financial resources to
address the site, they lack the responsible parties, the limits
again will be a burden that they will not be able to address.
The burden will continue to be borne by the citizens living on
and adjacent to these sites.
CERCLA is being required to be all the CERCLA sites
addressed in 2 years. Those sites then will become a problem
for the States. It is doubtful that the EPA has the financial
and technical resources to investigate the more than 10,000
CERCLA sites, and the States definitely do not have that
ability to address these issues.
State response programs, as you have it there, lack
elements of a minimum standard for a State program and a
mechanism by which EPA is required to evaluate and approve a
State program. States could basically isolate the public and
the impacted communities from participating in the State
program.
I have other issues included which you can read in the
testimony. And in conclusion, the Environmental Protection
Agency must retain the regulatory authority and financial
resources necessary to address all the sites that qualify for
Superfund designation. The authority is also necessary in order
to encourage involuntary cleanups by PRPs. The EPA further must
have the authority and resources necessary to address these
hazardous waste Superfund problems in States that cannot
address the problem.
In order to protect human health and the environment, the
Superfund program must not be completed, but must be allowed to
continue to address the remaining problem sites, as well as the
new sites that are being created. One of the issues at the
military basis has been prochlorate. I spent last week in Texas
with EPA, and this has opened up a whole new area that will
have to be addressed under the Superfund regulation. So there
will be new sites and new issues developed.
Thank you.
Senator Chafee. Well, thank you, Ms. Subra. I'll put you
down as lacking enthusiasm for our bill.
[Laughter.]
Ms. Subra. We're willing to work with you.
Senator Chafee. I see. I just have one question, Mr.
Curtis, you've heard the testimony from the prior panel about
finality. I think finality is going to be a key element here as
we try to move ahead and work out some kind of a compromise.
What finality means is that a Governor, under our legislation,
would be able to say, we're going to clean this up and this is,
we believe this is clean now.
But one of the arguments against that is that the Governors
will be easy on this and there will be sort of a race to the
bottom in connection with the control over the sites, the
creation of pollution havens by the Governors. I find that
argument difficult to follow. Any Governor is responsible to
his citizens. Could you give me some thoughts from the
Governors' association representing the Governors? We've got a
former Governor here from Ohio. I can only believe that he was
very conscious of his citizens' desires, and he's not going to,
I presume, not going to----
Senator Baucus. You have a former Governor from Rhode
Island, too.
Senator Chafee. Yes, he's a very thoughtful fellow, also.
[Laughter.]
Senator Chafee. He's just not going to willy nilly approve
something just to get it approved if the consequences are
potentially dangerous or harmful to his citizens. Could you
give me an answer from the Governors' Association?
Mr. Curtis. Yes, sir, I'd like to second what you just
said, actually. There's no reason to believe that Governors
would be easy on this problem, for a number of reasons. First
of all, there is no constituency for pollution. You don't get
votes in any election by hiding sites and sweeping these
problems under the rug.
Governors run in State-wide elections and have to appeal to
large numbers of voters. You simply don't present yourself as
appealing in today's body politic if you are associated with
hiding these problems, being soft on these problems. So there's
nothing to gain by any Governor for hiding these sites.
Moreover, every State that has adopted a cleanup program,
and there are 45 or 47, I believe, States that have adopted
programs, have actual cleanup standards that apply. In every
State, those standards apply both at NPL cleanups and at State-
led cleanups, cleanups that are conducted by the State under
its authorities, or sites that are cleaned up under a voluntary
cleanup program. We're not proposing that that would change,
and your bill doesn't change that. So those standards would
very much apply at these sites.
Senator Chafee. Senator Baucus.
Senator Baucus. Thank you, Mr. Chairman.
Mr. Johnson, I have two questions. One is, your point that
this legislation before us would create an unfunded mandate, in
effect, I guess so much of the pace of cleanups, and the second
question is with respect to caps, the NPL cap.
On the first, the question really is, why do you think it's
an unfunded mandate? I think you have a point insofar as an
analysis of the bill. It seems to indicate that the pace of
cleanup will slow down because of the combination of spending
cuts and cost increases. That is, the bill reduces
authorization of the cleanup program by about 25 to 30 percent
from current authorization levels, and also creates new
requirements that would increase costs, at least by some
estimates, up to $100 million a year. And it creates a large
new orphan share that could displace cleanup spending.
Would you indicate again why you think this bill will
create an unfunded mandate, and why cleanups will be left to
the States, in some respect?
Mr. Johnson. Yes, Senator. Under the bill, there are new
exceptions for liability at NPL sites, in particular, as well
as some of the other sites. If EPA does not have sufficient
moneys to fund those particular shares, cleanup will stop. If
cleanup stops at sites, quite simply, the States are going to
have to step in.
We can't afford to have a cleanup stop, because we have an
obligation to protect our citizens. So States will go in and
spend their money.
But they will be subject to the restraints on recovery
against various types of formerly liable parties because of the
new exemptions for liability at NPL sites.
Senator Baucus. And combined with the authorization
decrease.
Mr. Johnson. Particularly combined with the authorization
decrease. We have a very significant fear there. While there
have been some good changes in the bill, for instance, our O&M
costs now are capped at 10 percent, we're still going to end up
paying that 10 percent. If there isn't enough funding, we're
going to pick up more. And we're still going to have to pay our
share, our 10 percent share of those orphan shares, and the
other costs that are now going to be picked up by the fund.
Quite simply, not every State has the money to do that.
Senator Baucus. Mr. Curtis, what do you think about that?
You said Governors want to be responsible, want to clean up
sites. But if the Federal money isn't there, does that mean the
States will have to pay the bill to clean up the sites?
Mr. Curtis. Senator, I can't comment specifically on the
bill in that regard, because we have not yet completed our
review of it. I would say that the Governors have been
concerned about a shift in costs to the States as a consequence
of any liability reform. So we would want to make sure there is
not a cost shift.
Senator Baucus. Back to you, Mr. Johnson, on the NPL cap.
Essentially, as you probably know, GAO asked EPA as well as
States where they thought, the number of sites they thought
would be added to the NPL in the foreseeable future. EPA said
there would be about 126. States thought there would be about
132 listed. They agreed in only about 26, which is interesting
in and of itself.
But the point is that there are quite a few additional
sites that are not yet on the list. The bill has a cap of 30
per year.
Now, does that make sense? I'm concerned about the
arbitrariness of caps. I can remember in the Safe Drinking
Water Act not too many years ago, we required EPA to name 25
new contaminants, standards for 25 new contaminants a year,
irrespective of the science. Of course, that's dumb. We've
changed that. We went back to EPA and said, well, find out
which contaminants exist and which ones should we create
standards for.
At some time, we also put a cap on new endangered species.
We realized that was a little bit silly.
So if we want sound science, and many of us do, does it
make sense to have a cap where sound science might indicate
that there should be a thiry-first site, that is, a site more
than 30 that meet the criteria of 28.5 and should be on the
list?
Mr. Johnson. As we detail in our written testimony, we
think the idea of a cap is a very bad idea. No. 1, for the
reason that you just elaborated, it's bad science. If a site
needs to be listed, it should be listed. And it shouldn't be,
there shouldn't be an arbitrary cap.
The second reason that it's important, though, is that by
having the ability to list sites, people come in and agree to
clean them up, because they don't want to be put on the NPL. If
you remove that so to speak gorilla in the closet, that fear of
listing, people are going to stop cooperating with State
programs to a certain degree, and we're not going to be able to
get the same number of cleanups. What that means, of course, is
that the States are going to pick up those costs, another
element of the bill that concerns us particularly, because it's
going to shift costs to the States.
Senator Baucus. Right. And I might say, 30 is in the ball
park of what EPA estimates it will put on the list. EPA
estimates it will the list between 25 and 40 sites a year.
That's an estimate, they don't know for sure. The average over
the years has been about 20. One year I think there were 300.
But the point really is, if EPA's estimate is pretty close,
doesn't it make sense to let there be some flexibility rather
than an arbitrary number, because 1 year it might make sense,
and in another year, it might not make sense.
Mr. Johnson. We think that if you put a cap on it, you're
going to have a need to list more sites. Because we think that
when States and EPA estimate how many sites are likely to be
listed, they take into consideration how many sites are going
to be cleaned up voluntarily or through settlement and aren't
going to need to be on the NPL and won't need Federal moneys.
If you remove that ability to list a site by arbitrarily
setting an upper limit, I think there's going to be less
settlements and more likely you're going to have PRPs say,
well, list the site. We don't care. We're not interested in
cleaning it up, because they know that the site has less of a
chance of being listed because there's a cap on the number of
sites that are being listed.
Senator Baucus. Thank you.
Senator Chafee. Senator Crapo.
Senator Crapo. Thank you, Mr. Chairman.
Mr. Curtis, in the legislation we're considering here, are
there any proposed limitations on the EPA using Section 106
orders to complete cleanup actions? What I'm getting at is
this. If the EPA found that the NPL cap was too restrictive and
began to use 106 orders to circumvent the restriction, would
the public and State participation be increased or reduced, or
what would the impact be?
Mr. Curtis. I'm not aware of any restrictions on 106 order
authority in this bill. I'm happy to look at it more carefully
and respond to your question in writing. But I am not aware of
any restrictions on 106 authorities in this bill. I don't think
that EPA's authorities are limited in that sense under this
bill.
Senator Crapo. I don't think there are restrictions on 106
authority in the bill, and if that's correct, what would the
impact of that be on the ability of us, of the EPA to
essentially avoid the NPL cap restrictions and basically order
cleanup outside of the whole process that the bill
contemplates?
Mr. Curtis. Well, EPA could use its 106 authorities to
order cleanups. Whether or not that authority would be as
effective without an ability to threaten, at least, a listing
on the NPL than a fund financed cleanup and a cost recovery
action, I think we'd have to analyze and think about whether or
not there might be some secondary effects of that kind.
Senator Crapo. You've also heard today in some of the
discussion the fact that one of the concerns that some raise is
that the bill does not reauthorize the Superfund taxes. Do you
or do the Governors have a position on that issue?
Mr. Curtis, Senator, we do not have a view on that issue at
this time.
Senator Crapo. All right, thank you.
Ms. Kerbawy, I'd like to get your reaction to the same
questions. What do you think of the fact that the bill does not
limit what Section 106 authority does in terms of achieving the
kinds of reforms that are necessary?
Ms. Kerbawy. Well, there are a couple of things there I
think we need to consider. One is that most of the responsible
party work that's been done under Superfund has been as a
result of EPA's ability to actually fund and cost recover for
response actions rather than moving forward into enforcing an
order that's been issued.
So I think although EPA does certainly issue orders, I
think the primary impetus to make responsible parties move
forward has been their ability to go ahead and fund a remedy if
a responsible party refuses to implement the remedy. I think
probably they could issue the 106 orders, but the effectiveness
of being able to move forward without have a site on the NPL
and the ability for EPA to then fund a remedy will limit their
ability to move remedies forward with 106 order authority.
The other thing I see happens there is if there is the
ability to have State finality onsites, if they are not on the
NPL, that will allow work to proceed at the State level to get
the sites cleaned up.
There is in this bill also the provisions that emergency
actions certainly can be taken by EPA or could be ordered by
EPA if there is a critical need, environmental or human health
need to get work done. So I think that work should be able to
proceed that needs to proceed, either under State authority or
Federal authority, but there won't be the overlap that we
currently have now.
Senator Crapo. Does ASTSWMO have a position on the
reauthorization of taxes?
Ms. Kerbawy. Our primary concern is that the work can be
funded that needs to be done either at the Federal or the State
level. Whether that is through tax reauthorization of whether
that is through some other funding mechanism will be left to
Congress and to the Governors to deal with those positions.
Senator Crapo. I take it then that if the taxes were to be
reauthorized, that would not then cause ASTSWMO to oppose this
bill? In other words, if a reauthorization of taxes was added
to this legislation, would ASTSWMO still support the bill?
Ms. Kerbawy. I don't think that would cause us to not
support the bill.
Senator Crapo. Mr. Curtis, that's what I understood from
your answer as well, is that correct?
Mr. Curtis. That's correct.
Senator Crapo. Mr. Johnson, same questions. On 106
authority, does that cause you any concern, the fact that 106
authority is not addressed in the bill?
Mr. Johnson. I don't think we've looked at it that closely
with respect to that particular issue. So we'd be happy to
answer any questions and get back to you on that. We think,
though, it's important that EPA retain authority to issue 106
orders.
We did in our written testimony note that during the
allocation process, there are restraints on EPA's ability to
issue 106 orders. We think that is a serious problem. We don't
think that Superfund should be an argue first and then clean up
program. But it should be clean up first, and then argue.
If you have restraints on EPA's ability to issue 106
orders, particularly during the allocation process, we don't
think that's a very good idea.
With respect to taxes, the Attorneys General are concerned
that there be a consistent revenue stream, so that we don't run
into a problem during the appropriations process or at other
times, and EPA lacks sufficient funds to do what it's required
to do under this statute. So I don't see any problem from an
Attorney General's perspective with respect to an authorization
of the tax.
Senator Crapo. Thank you.
Senator Chafee. Thank you, Senator. Senator Lautenberg.
Senator Lautenberg. Thanks very much.
Mr. Curtis, just to clarify, does the Governors'
Association favor a cap on the NPL?
Mr. Curtis. No, sir. We understand there have been a lot of
concerns and a lot of discussions about ramping down the
Superfund program, as EPA comes near the end of the work at the
sites currently listed on the NPL. We believe that the
appropriate way to address the concern about the future of the
program is by giving the Governor the right of concurrence on
new sites on the NPL. We think that would take care of that
problem.
Senator Lautenberg. Concurrence or initiation?
Mr. Curtis. Our policy actually asks for a Governor's
concurrence. The bill before the committee addresses that
recommendation by requiring a Governor to invite a listing.
Senator Lautenberg. Right. So that's not a position favored
by the NGA?
Mr. Curtis. A strict reading of our policy would suggest a
Governor's right of concurrence with a new listing on the NPL.
Senator Lautenberg. That's quite different. Do you think,
Mr. Curtis, that we ought to maintain the pace of the cleanups?
Mr. Curtis. Well, Senator, again, I believe that there will
be a natural change in the pace of cleanups as EPA comes to the
end of the work at the sites currently on the NPL. I don't know
what the pace will be in the future. I think that goes to the
question on the cap, whether there are 20 sites or 50 sites or
100 sites that may be listed on the NPL in the future, that
would be the appropriate pace we would say.
Again, urging you to give the Governor the right of
concurrence with those new listings, so that there is not
duplicative work, nobody benefits when EPA and the State both
have the resources to address a site, and in that case, one
level of government should address the site.
Senator Lautenberg. But you wouldn't, your organization
wouldn't necessarily favor a slowdown in the pace of cleanups?
Mr. Curtis. Well, again, we believe that there will be a
natural change in the pace of the Superfund program.
Senator Lautenberg. As sites are cleaned up.
Mr. Curtis. As sites are cleaned up. We do not have a
position specifically recommending that Congress legislate the
shape of the program or the shape of the curve as the program
ramps down in the future.
Senator Lautenberg. So do you think there will be a natural
decline in the pace based on cleanups, or do we have a few more
sites that ought to be paid attention to?
Ms. Subra. There are a number of sites that need attention.
I think if the financial resources are there, the level of
effort should be the same. Because I think overall, the level
of effort is being driven by the financial resources. But we
have a lot more sites to be addressed.
Senator Lautenberg. There's a November 1998 GAO study that
stated, officials of about half the States told us that their
State's financial capability to clean up potentially eligible
sites if necessary is poor or very poor.
Ms. Kerbawy, are you familiar with that?
Ms. Kerbawy. Yes, I am. I think that certainly funding for
Superfund type of remedies, if States were to have to bear all
of the costs of sites that were on the NPL, that would be an
unfunded mandate similar to what Mr. Johnson said. But right
now, we don't see that that information, as far as the States
that don't currently have funding, actually correlates to where
the sites exist.
There are States where we have a number of sites. I'll give
Michigan as the example. We have had up to 84 sites that have
been listed on the NPL. And we have thousands of State sites.
Obviously we have to deal with those issues, and we do fund the
program that needs to be funded.
So I think that where the problem exists, and where the
public has recognized that the States have an issue that needs
to be addressed, then the States rise to the occasion and do
fund those programs.
Senator Lautenberg. Well, I'll ask you the same question
that I asked Mr. Curtis in terms of the number of sites that
listed. Do you think that a cap is appropriate? I don't know
whether Senator Baucus asked that question before of you. Do
you think we ought to cap the number of sites listed?
Ms. Kerbawy. An NPL cap is not something that we're looking
for. The way that it's crafted in this bill, I'm not sure that
it creates problems for us. Right now, EPA is listing
approximately 20 sites a year. The cap lays out about 30 sites
a year. It still provides the ability for the gorilla in the
closet that people are using today.
After the first 5 years, I believe it's 100 sites could be
added. It's not something we're looking for, it's not something
that we're excited about. But it doesn't appear, the way it's
crafted, that it's a problem.
Senator Lautenberg. Last question. Do you think that the
EPA ought to wait until the request comes from the Governor, or
do you agree with Mr. Curtis that a Governor's concurrence
would be the best approach?
Ms. Kerbawy. It's very important to the States that there
be a Governor's concurrence. I think the ability to influence
what sites go onto the NPL is very critical to us. A Governor's
concurrence would be very helpful.
Senator Lautenberg. But you don't think it's necessary that
the Governors initiate the request in order for a site to get
listed?
Ms. Kerbawy. The key point is that there be Governor's
control over whether a site moves forward or not.
Senator Chafee. Senator Voinovich.
Senator Voinovich. Ms. Kerbawy, first of all, I'd like to
congratulate Michigan on the great program that you have on
brownfields.
Ms. Kerbawy. Thank you.
Senator Voinovich. Specifically, I think the fact you've
got, what, a $400 million bond issue you've passed that can act
as kind of a guarantee that if something is discovered later
on, that the State will pick up the cost has been a real
reassurance to some of your business people to go forward with
cleaning up their brownfield sites. We're envious of you in
Ohio for having that.
I am a strong supporter of waiving Federal liability at
sites that have met the cleanup requirements under State laws
and programs. However, I'm concerned that this legislation does
provide a hindrance to expediting State cleanups by requiring
all sites to be listed on the CERCLIS for 2 years in order to
receive the Federal liability waiver.
In our State, about 25 percent of the known contaminated
sites are not on CERCLIS. I think this potentially has the
effect of slowing down cleanups at these sites. I would like to
know, do you believe it's necessary for all sites to be
included in CERCLIS in order to receive the exemption from
Federal enforcement as specified in the bill?
Ms. Kerbawy. That is one of the provisions in the bill that
we have some concerns about, particularly with regard to
brownfields. I think that listing on CERCLIS is an unnecessary
step and one that can create problems for brownfield
redevelopment. I think that one of the things that just
recently happened was the archiving of 25,000 sites from
CERCLIS to help in promotion of brownfield development.
I think that was a recognition by the Federal Government
that a listing on CERCLIS was a specter on those sites that was
inhibiting brownfield redevelopment. I think that would also be
the case if we had to list a site on CERCLIS for a couple of
years before it moved forward.
We have thousands and thousands and thousands of sites
across the country that need to move forward under State
programs and are not going to be addressed by the Federal
Government. To have to have them be listed on CERCLIS in order
to move them forward will create more problems.
Senator Voinovich. Thank you.
Senator Chafee. Senator Smith.
Senator Smith. Thank you, Mr. Chairman.
Mr. Johnson, you did identify some areas in the bill That
you felt could be clearer, and as you know, my staff has been
working with you on that and will continue to do that to try to
clarify your concerns. But you state that the NAAG favors
affording appropriate legal finality to cleanup decisions of
qualified State voluntary cleanup programs and brownfields
redevelopment programs. So I think in that respect, is it fair
to say that you do agree with the mayors and the Governors and
the State waste management officials on that issue?
Mr. Johnson. Yes, we generally agree with them. I think
that we would like to continue to work with you and the other
Senators no the precise language in the bill and how the
reopeners would work and whether a program has to be qualified
and how that might take place. But we think basically the
concept is important, the concept should be followed through,
we support the concept and we'd be happy to work with everyone
in making sure that the legal language works and does not pose
a hindrance or have a bad effect on the environment or the pace
of cleanups.
Senator Smith. Ms. Subra, in your testimony, you stated
that even though EPA and GAO tell us that the Superfund program
is ramping down that we should not reduce funding. How do you
justify that, if we're ramping down the program?
Ms. Subra. In the State of Louisiana, we have approximately
500 sites that haven't been addressed. In addition, we have 50
sites that have been identified needing cleanup. We as a State
do not have the money. Every time a new site is identified or
an emergency occurs, we have to look to EPA to come in and do
the work.
The sites that are being put on NPL right now in Louisiana
are all fund led sites. So we have been sort of slow in the
process, we have less than 20 Superfund sites that are on the
NPL list, a number of which are completing cleanup. But if
there isn't financial resources at the Federal level, then the
sites in Louisiana will not be addressed. We're looking to the
Feds to help us clean those sites up.
Senator Smith. Do you support State finality?
Ms. Subra. In the State of Louisiana, no. Because what
happens in the State of Louisiana is the legislature can
suddenly decide to just gut the program, a new industry can
come in and hire away all the experts at the State level. And
if you have State finality, that comes under the jurisdiction
of legislative mandates. The political will is not there to
have State sites in Louisiana appropriately cleaned up.
Senator Smith. Well, as I indicated to the previous panel
on a question, our legislation specifically says that the State
allows EPA, EPA is allowed to come into a State, one, in an
emergency, two, at the request of the State, three, if the
State's remedy fails and the State is unwilling or unable to
respond, and where the contamination has migrated across the
State line. Why do you object to that language?
Ms. Subra. Also you have to have criteria in there where
citizens can petition to have EPA come in. Because that's
what's happening right now. It's over and over again in the
State of Louisiana, the citizens are asking EPA to come in and
address the problems. The State isn't asking EPA to come in in
all cases.
Senator Smith. So it's more than just the State's ability
or inability to perform? You want more citizen participation?
There is citizen participation now, you know.
Ms. Subra. But in your criteria that you listed, you didn't
have one that says, the citizens can petition EPA to come in
and address a problem.
Senator Smith. Even if the State doesn't want them in, or
need them?
Ms. Subra. If the citizens feel that the State is not doing
an adequate job, they need to be able to petition EPA, and then
EPA comes in and addresses the issue on whether or not the
problem is bad enough for them to step in.
Senator Smith. Ms. Kerbawy, let me ask you one question.
You stated in your testimony that you found that the States
have completed about seven times as many sites per year in
recent years as they have in the first 12 years in the program,
so that the State accomplishments are increasing. Yet we hear a
lot about the need to recognize these changes in the Superfund
program.
What I continue to hear and witness after witness at some
of the sites that I've visited around the country, it seems to
indicate that although the law provides a role for EPA at NPL
sites in theory, in practice it's not happening as much as it
should. Is that fair? Does that represent your view?
Ms. Kerbawy. I'm not sure I understood the question. You
were wondering at EPA's role at NPL or non-NPL sites?
Senator Smith. Non-NPL. The law provides a role for EPA at
non-NPL sites in theory, that in practice is probably not
exercised. Is that a fair statement?
Ms. Kerbawy. Yes, I think that is a fair statement. EPA
generally does not get involved in non-NPL sites, except for
removal actions. We very rarely see them get involved in those
sites.
But the liability extends across all sites where there is a
release. What we see really happening and having the most
impact is that people are afraid that the Federal Government
will come in and exercise the liability issue.
The other thing is that there is cause of action for third
party contribution suits, things like that. So people are
afraid that they will get brought in for compensation, cost
recovery by others that have performed cleanup work.
So the specter of the liability issue, even though EPA
generally does not get involved in the non-NPL sites, is still
there. It's still a problem for the brownfield sites.
Senator Chafee. I want to thank everybody in the panel. We
appreciate your being here.
Now, if the next panel will come right up. Let's take all
six at one time.
Mr. Bernie Reilly, from Du Pont; Karen Florini, from EDF;
Mark Gregor, from the city of Rochester; Mr. Nobis; and Mr. Red
Cavaney, the President of American Petroleum Institute; and
Mike Ford. If you could all take your seats.
Mr. Reilly, why don't you proceed.
STATEMENT OF BERNARD J. REILLY, CORPORATE COUNSEL, DU PONT DE
NEMOURS E.I. AND COMPANY
Mr. Reilly. Good afternoon, Chairman Chafee, Chairman Smith
and members of the committee. My name is Bernard Reilly. I'm
corporate counsel for the Du Pont Company, and I'm here
representing the Chemical Manufacturers Association.
CMA has worked on Superfund reform since the early 1990's
with the Members of Congress, the Administration, environmental
groups, States, cities and other business organizations. In
addition, we have worked with EPA to improve the Superfund
program through administrative reforms.
I would like to commend Chairmen Chafee and Smith for their
leadership over the years in trying to reform the Superfund law
and for their introduction of S. 1090, the Superfund Program
Cleanup Act. CMA recognizes the Senators' accomplishments in
producing this bill. It is a good bill.
As long participants in the efforts to reform Superfund,
CMA understands that this is not an easy task, and looks
forward to working with both the Republican and Democratic
members of the committee and the Senate on this bill.
CMA has completed a preliminary review of the recently
introduced bill. We'd like to spend the next few minutes
highlighting what is especially noteworthy, touching on a
number of strong areas and following with some areas that we
believe could be improved.
Clearly the most important issue facing Congress at this
time is the future direction of the program. As we've
previously noted, after 17 years of existence, there's more of
Superfund behind us than ahead of us. According to EPA, nearly
90 percent of all non-Federal sites in the NPL are undergoing
cleanup.
Congress needs to determine what remains to be done under
Superfund, how long it will take and how much it will cost. We
strongly commend the co-sponsors of S. 1090 for recognizing
these critical issues and taking appropriate steps to address
them.
CMA has prepared estimates of the funding required to
complete the job at hand. These indicate that Superfund funding
could be dramatically reduced and there still would be
sufficient funds to pay for both the remaining sites that GAO
and EPA have concluded will be added to the NPL in the future.
Program spending levels should be adjusted according to fit
the future needs of the program in order to ensure that more
funds than necessary are not appropriated. S. 1090 does exactly
that. Congress should take the next step and direct an
independent study of funding needs.
In addition to recognizing that Superfund is moving toward
completing the job of cleaning up existing sites and that
funding levels need to be adjusted accordingly, S. 1090
contains other important provisions. These include finality for
State cleanups, an integral Governors' role in the process of
listing sites on the NPL, liability relief to ensure that
brownfields are redeveloped, and a recognition of the State's
primary role in cleanup. We strongly commend the chairman for
these provisions as well.
Another aspect of this bill deserves credit, and at the
same time it raises some concerns about its implementation.
This particular aspect has to do with exemptions that are
provided for certain parties and the allocation system that is
set up to pay for those parties' shares.
The bill deserves credit for recognizing that it would be
wholly unfair to pass exempt party shares to the remaining
parties at the site. The allocation system that is set up to
determine these shares, however, appeared to be flawed. Under
this system, industrial parties at these sites not only will
continue to pay more than their fair share of liability, they
likely will have to pay for shares attributed to exempt
parties.
As we all know only too well, it is not easy to develop
fair, defensible and acceptable liability allocations. CMA has
advocated a streamlined system for several years calling for
the inclusion of certain basic elements, but not overburdening
the system with details.
The single most important element of any streamlined
process is that it be administered by third party neutrals who
do not have a vested stake in the outcome. S. 1090 does not
include this element. Instead, the bill designates EPA as the
allocator. This is not appropriate, given EPA's demonstrated
vested interest in preserving the trust fund and the culture of
assigning liability only to the financial viable parties.
Fundamental reform to ensure a successful, cost-effective
future of the Superfund program also requires changes to areas
including natural resource damages, remedy selection, and cost
recovery programs.
In conclusion, Chairman Chafee and Chairman Smith and
members of the committee, we would like to thank you for
undertaking the hard work necessary to produce the Superfund
Program Completion Act. As I have said, the future direction of
the program is the most critical issue facing us in reforming
Superfund. We see that future as one in which sites currently
listed on the NPL are cleaned up and the remaining sites are
addressed under a reduced program with reduced spending levels.
We strongly commend you for taking an innovative look at these
issues and addressing them in S. 1090.
We appreciate the opportunity to provide this input, and I
would be delighted to answer any questions.
Senator Chafee. Thank you very much, Mr. Reilly.
Ms. Florini?
STATEMENT OF KAREN FLORINI, SENIOR ATTORNEY, ENVIRONMENTAL
DEFENSE FUND
Ms. Florini. Thank you, Mr. Chairman.
My name is Karen Florini, I'm a senior attorney with the
Environmental Defense Fund.
I think this is the fourth or fifth time I've appeared
before this committee to discuss Superfund reauthorization in
the last few years, and personally, I would be just as happy if
this were the last such occasion that came along. I was very
pleased to hear that you will be in discussions shortly with
the Administration in the hopes of developing a bipartisan and
widely supported bill that addresses the issues that are in S.
1090, and I wish you all Godspeed.
There is no question but that the Superfund program has
changed dramatically in the half dozen years since we all
started these discussions about Superfund reauthorization.
While Superfund still has its critics, myself among them, the
real question at this point is whether S. 1090 as it stands now
would make things better. We recognize and applaud the fact
that this bill is considerable narrower than Superfund
reauthorization bills that have been introduced in prior
Congresses. Unfortunately, however, we conclude that S. 1090,
as it stands, would not generally make things better and
therefore we oppose the bill.
I will describe a couple of my major objections in a moment
but first, I do want to note that we do continue to believe
that reimposition of the Superfund polluter pays taxes
continues to be important. Fundamentally, we think it's time
for the industry's $4 million a day tax holiday to end.
With respect to the specific provisions of S. 1090, one of
the major concerns involves the bill's reductions in authorized
funding levels over the next 5 years. It is far from clear that
EPA in fact is going to need less money. It is true that there
have been 600 construction completions, but there are another
700 already listed sites still on the Superfund list.
It is my understanding from informal discussions with EPA
that the agency expects to continue construction completions at
about the same pace, as has been the case in very recent years,
about 85 per year, which of course they will not be able to do
if funding is curtailed. For years, critics of the Superfund
program have bemoaned the slow pace of cleanups. Now that the
pace has increased, it is not appropriate to choke it off
through inadequate authorizations.
While it's true that the shape of the Superfund pipeline is
different now than it has recently been, the bill simply
ignores the fact that correspondingly, there are a lot more
sites that are now in the operation and maintenance phase. To
date, EPA has done a miserable job of keeping up with their
statutory obligation to conduct 5 year reviews at sites where
some contamination has been left in place. I have an article
attached to my written testimony that details the 5-year review
program and how little progress has been made in implementing
it, and some of the serious problems that have been found in
sites where, the few sites where EPA has gone back and taken a
look.
Only by that kind of active oversight can we hope to know
where remedies are not working and actually to take action to
protect health and the environment at those sites. In other
words, even if EPA were to need fewer resources for the
construction completions in the years ahead, an assumption that
I do not believe is warranted at this time, the agency is going
to need more resources to conduct the 5-year reviews and the
followup actions associated with the results of those reviews.
To add insult to injury, S. 1090 provides that funds for
liability relief get preferential treatment and that an ability
to finance liability relief at a site limits EPA's ability to
order final cleanup steps at the site. Doubtless, it will not
come as a particular surprise for me to tell you that we
strongly oppose those provisions.
Turning to the fair share allocation process, generally
although that sounds innocuous, we think there are some serious
problems in the bill as it stands. My written statement
provides additional details on that.
Finally, I want to mention that we oppose numerous
provisions in S. 1090 that would cut holes in the Federal
safety net for cleanups. I want to talk specifically about the
finality issue that has been much discussed this morning. There
is already in law provisions for lender liability relief. This
bill contains, and we support, provisions for prospective
purchaser liability relief.
What we are really talking about with finality is giving a
windfall liability relief to current sellers. We strongly
oppose that. We do not think it is necessary or appropriate to
tell a seller of a contaminated property who is and has for the
last 20 years been liable under Superfund that if the State
comes in, oversees a cleanup that by definition is ineffectual,
that when EPA comes to want to take additional action and
recover its costs, that the agency has restrictions on its
ability to do so. That just does not compute in our calculus.
Finally, we have some concerns, we strongly oppose the cap
on the number of NPL sites, for reasons that Senator Baucus
laid out. It's not sound science. The number of sites that
should be listed is the number of sites that need to be listed.
We also oppose the Governors' concurrence. While we agree
that it's appropriate for there to be an orderly mechanism and
for States to have first dibs onsite where they can and will
proceed expeditiously to handle the site, that is far different
than telling the Governors that they have a veto over the
listing of the sites.
We have some concerns about over-breadth of some of the
liability carve-outs. But I do want to mention, to close on a
positive note, by saying that we agree that the pull-back
mechanism that exists for some of the liability relief
provisions is indeed appropriately crafted. We think it is very
important to have a pull-back provision that says that if some
of these rough rules that are embodied in the liability
provisions turn out not to be appropriate to apply in
particular cases, it will be possible to utilize the pull-back
provisions so that you don't end up with an anomalous result as
would otherwise occur.
Thank you.
Senator Chafee. Thank you, Ms. Florini. Now, Mr. Mark
Gregor from the city of Rochester, on behalf of Local
Government Environmental Professionals.
Mr. Gregor?
STATEMENT OF MARK GREGOR, MANAGER, DIVISION OF ENVIRONMENTAL
QUALITY, CITY OF ROCHESTER, NEW YORK
Mr. Gregor. Thank you and good afternoon, Mr. Chairman and
other members of the committee. My name is Mark Gregor, and I'm
the Manager of the city of Rochester's Division of
Environmental Quality. One of my primary responsibilities is to
actually conduct the investigation and cleanup work at
brownfields sites and some State Superfund sites.
I'm pleased to have the opportunity to testify here today
in behalf of the National Association of Local Government
Environmental Professionals, or NALGEP. We represent city and
county environmental managers and more than 100 local
governmental entities across the country. Our members include
many of the Nation's leading brownfield communities, including
Dallas, Chicago, Portland, Baltimore and Glen Cove that you
heard from earlier today.
NALGEP has been working actively with local governments on
brownfields since 1995, when we began a project which led to
the publication of our first report, Building A Brownfields
Partnership From The Ground Up, with local government view on
the value and promise of national brownfields initiatives. We
continue to coordinate work groups to address critical
brownfield issues, such as revolving loan funds, voluntary
cleanup programs, smart growth and the implementation of EPA's
showcase program.
Brownfields are undoubtedly one of the most significant
issues for urban areas, including Rochester, New York. The
cleanup and redevelopment of brownfields is one of the most
exciting and challenging opportunities that we have facing the
Nation. And I would compliment the members of the committee on
their leadership in promoting legislative solutions to this
issue. Virtually every community faces brownfield challenges.
Brownfield revitalization provides important environmental
and economic benefits, including the cleanup, of course, of
sites, the renewal of local economies by stimulating
redevelopment and job growth and job retention and enhancing
the vitality of communities, as well as limiting sprawl and its
associated environmental problems of traffic and air quality
problems and over-development of rapidly disappearing green
spaces.
During the last 5 years, the city of Rochester has
completed the remediation of more than 50 acres of brownfields,
including the site of Bausch and Lomb Corporation's new
corporate headquarters, a site of a new Federal Aviation
Administration funded aircraft rescue and firefighting
facility, and a site of a state-of-the-art 911 office of
emergency communications.
The city was selected as one of the first rounds of EPA's
pilot brownfield cities, and Rochester was also awarded one of
the brownfield cleanup revolving loan grants from EPA. Using
the first grant from EPA, the city investigated 15 and a half
acres of junk yards and scrap yards, fuel depots and a rail
yard. That 15 and a half acres now is part of the city's Erie
Canal Industrial Park.
Rochester is also in the process of establishing a site
investigation fund to provide private sector funds for
investigation of sites.
The Federal Government, particularly U.S. EPA, has played
an important role in helping Rochester develop the capacity and
infrastructure of our brownfield program. Critical funding has
enabled us to institutionalize some of these programs,
technical assistance and other resources that have helped us
learn from other communities has been extremely important. The
connections with other Federal agencies through EPA's efforts
have been very helpful.
Most importantly, it's been able to provide critical
leadership to the various stakeholders in our community to help
understand the problem a little bit better.
NALGEP is interested in legislative action in three areas.
Additional funding in the form of grant and loan programs is
especially important for many cities, including Rochester.
Rochester has a declining tax base now and falling assessed
property values. So budgetary and financial issues are crucial
to us.
New Federal legislation to further clarify and provide some
limits on the liability of non-responsible new owners of
brownfield sites that voluntarily complete cleanups is very
important. The need to facilitate and encourage the
participation of other Federal agencies in brownfield
revitalization continues to be important and will become more
important for us.
With respect to the first item, with regard to funding,
continued Federal investment is critical to the cleanup and
development of brownfields. Funding is needed for site
assessment, remediation and redevelopment. Costs for site
assessment and remediation can often be significant initial
barriers to getting projects and site work underway.
The EPA pilot grant, grant programs focused onsite
assessments, have enabled many communities to initiate this
work and have begun to give developers and lenders some
additional confidence that local governments, State governments
and Federal Government are taking the brownfield issue
seriously.
Congress should build on this success.
Senator Chafee. Mr. Gregor, do you want to summarize your
points here?
Mr. Gregor. Sure. Basically, there are three areas that we
look toward our grants, grants for cleanup, grants for
investigation, capitalization of revolving loan funds that are
not exhibited by or encumbered by national contingency plan
administrative requirements.
In addition, we are looking for additional clarification of
liability on the part of new owners in particular. And Congress
should also further clarify and limit liability for non-
responsible parties, as I mentioned earlier.
Finally, with respect to the finality question, NALGEP has
found that one of the most significant things that the Federal
Government can do is to facilitate brownfields re-use by EPA
delegating the authority to limit liability and issue no
further action decisions for non-NPL caliber sites to the
States. NALGEP has proposed that there be some initial entry
criteria for those States and they are indicated in the
testimony, the written testimony.
Finally, with respect to the finality question, NALGEP is
of the opinion that EPA should provide that it will not plan or
anticipate further action at any sites unless at a particular
site there is an imminent or substantial threat to public
health or the environment, and either the State response is not
adequate or the State requests EPA assistance.
Finally, with respect to other agencies and other Federal
agencies' involvement, the Congressional action to clarify the
use of community development block grant funds for cleanup
purposes has been very helpful. By their actions, many of these
Federal agencies have significant impact on our ability to
reuse brownfields, as well as to prevent the concerns of sprawl
in green field areas.
Thank you.
Senator Chafee. Thank you very much, Mr. Gregor.
Mr. Nobis?
STATEMENT OF MIKE NOBIS, GENERAL MANAGER, JK CREATIVE PRINTERS,
QUINCY, ILLINOIS
Mr. Nobis. Thank you, sir.
Mr. Chairman and distinguished members of this committee,
my name is Mike Nobis, and I am from Quincy, Illinois. I'd like
to thank you for allowing me this opportunity to speak to you
today, to share my hometown's experiences with a landfill that
became a Superfund site. It's my hope and my goal this morning
to bring a different perspective on what the effects are of a
Superfund site and the Superfund law.
I'm the general manager and a part owner of JK Creative
Printers. My company, which my family has owned for over 30
years, employs 43 employees. We are very proud members of the
National Federation of Independent Businesses, the NFIB. I'm
very honored here today to present this testimony on behalf of
the 600,000 business owners who are members of the NFIB.
If you don't know where Quincy, Illinois is, Quincy is just
a small community of 42,000 people. We're located on the banks
of the Mississippi River, just 150 miles north of St. Louis,
Missouri. If you don't know where that is, if you recognize the
stomach of Illinois, we're the belly button.
[Laughter.]
Mr. Nobis. Our town is a great place to live in and to
raise a family. We do believe that we've enjoyed many years of
good economic growth, good schools, strong community
involvement and very good city leadership.
Of all the expectations we do have of our community, having
our landfill declared a Superfund site was definitely not one
of them. In 1993, you might remember when the Mississippi River
reached its highest stages of flood stages in history, this
prompted our community to rally together and beat back the
floods, and the effects of it. Now my community again is being
forced to band together to fight the unfairness of a Superfund
law that is punishing us for legally disposing of our trash.
Companies that once worked together to fight back this
flood are now suing each other because of the Superfund
landfill. Companies who once worked together to sell and buy to
each other are now suing one another.
For my company, it started on February 10th, 1999, this
year, when we received in the mail from the EPA a letter that
stated that six local corporations and the EPA and the city
were looking to recover some of the costs For cleaning up our
local landfill. Even though what we had hauled there was only
trash and totally legal, the EPA said that because we sent our
trash there that we were potentially liable and responsible For
paying our proportional share of the cleanup.
When you get a letter like this, as when I got this letter,
I felt very sick, needless to say. For me and the 148 other
companies that received this letter, it was totally unexpected
and without warning. At first, we had no idea what this letter
was really even telling us. We soon found out that it was
asking us as small companies to contribute $3.1 million.
I had to laugh at that language, because they used the word
contribute. They weren't asking us to contribute anything. They
were threatening us to pay.
My company's designed amount was $42,000. I really consider
myself lucky. Because there were other companies and other
individuals being asked to pay $70,000, $85,000, and there were
some small companies being asked to pay over $100,000. As I
read through the list, you could see things like Catholic grade
schools, our local university, bowling alleys, small mom and
pop hauling companies, furniture stores, and yes, even our own
McDonald's was listed to pay.
Most of the companies named only generated waste like plain
office trash or food scraps. In the mid-1970's, when our
company's trash began to be put in that landfill, I was in
college. We have other owners, in another company, a person who
owned the company was only seven when the landfill was in use.
Yet we are being held responsible.
The document made it sound as though we were major
hazardous waste dumpers. Yet nowhere in the document did it
list what waste we were accused of dumping.
Senator Chafee. You have a long way to go here, Mr. Nobis.
If you will summarize, see the light here.
Mr. Nobis. I'll get through this. The important part of
this is, when the EPA came into our community and tried to
explain to us the application of the law, we had found out that
the law was really unfair to us. Our community found it as un-
American as possible. We found ourselves in a very difficult
position. We were being asked to contribute funds of money that
we weren't responsible For in any of the waste that went to the
landfill.
It is important For us to try to communicate today to this
committee that small businesses need to be removed from the
liability of contribution to these sites. Because the effects
of these funds that we're being asked to pay For the landfills
are devastating our Companies. We don't have the funds or
resources to help pay For the cleanup of these sites.
Thank you.
Senator Chafee. I think that's very good testimony, Mr.
Nobis.
All right, Mr. Cavaney, from API?
STATEMENT OF RED CAVANEY, PRESIDENT AND CEO, AMERICAN PETROLEUM
INSTITUTE
Mr. Cavaney. Mr. Chairman, members of the committee, my
name is Red Cavaney. I am President and CEO of the American
Petroleum Institute, which represents over 400 U.S. companies
from all segments of the oil and natural gas industry,
including exploration and production, transportation, refining
and marketing.
It's a pleasure for me to be here today to speak in support
of yours and Senator Smith's Superfund reform legislation, the
Superfund Program Completion Act of 1999. I request that the
written statement I have submitted be inserted into the hearing
record.
Senator Chafee. Without objection, so ordered.
Mr. Cavaney. API supports your efforts and applauds you for
moving the Superfund debate a giant step forward. Your
legislation addresses the difficult and complex issue of
liability reform, one of the central problems that has plagued
the program. It moves the Federal program toward completion by
capping the number of sites on the National Priority List and
by increasing the responsibility of States For administering
cleanup activity.
It addresses the emerging issue of brownfields
rehabilitation and it appropriately recognizes that the
Superfund program should be funded with general revenues. To be
sure, the Superfund program needs additional repairs. But as
you and Senator Smith so correctly note, Congress and the
Administration have been unable to find acceptable compromises
on many issues. The lack of agreement on those issues should
not prevent Congress from making important changes included in
the Chafee-Smith bill.
The petroleum industry has a unique perspective with regard
to Superfund. Oil and gas Companies have paid more than 57
percent of all the taxes collected for the program. Let me
emphasize, the oil and gas industry's tax payments far exceed
its responsibility For Superfund cleanups, which the U.S.
Environmental Protection Agency has estimated at less than 10
percent.
The Superfund Trust Fund was created to pay for the cleanup
of abandoned or orphaned hazardous waste sites. However, only
11 percent of its funds have been expended for that purpose.
According to the General Accounting Office, about half the
program's funds have paid the cleanup costs for non-orphan
sites, and only a small percentage of these dollars have been
recovered. If EPA improves its recovery of cleanup costs from
known responsible parties, the program will need less funding
from general revenues in the future.
Those who contributed to a hazardous waste site should
continue to be held responsible to pay for their share of the
cleanup. Let me assure you, Mr. Chairman, that authorizing
general revenues for Superfund is consistent with the basic
principle. Even though the dedicated taxes expired in 1995,
responsible parties have continued to pay their share of
hazardous waste site cleanup costs. For example, from 1996
forward, we estimate that oil and gas companies will pay a
total of $1.2 billion in direct Superfund cleanup costs.
Despite the many shortcomings of the Superfund program, 89
percent of the sites on the National Priority List are in some
stage of cleanup. Superfund in its current form is moving
toward completing its mission. Revenues from the general fund,
fines, penalties, interest on the fund balance, and de-
obligated funds, assure funding for the program well into
fiscal year 2001.
According to reports by GAO and the Congressional Budget
Office, there are no legal impediments to the use of general
revenues to fund the Superfund program. It makes sense for
Congress to use general revenues to pay for orphan shares and
administrative costs in the remaining years of the program as
the bill proposes.
This is an appropriate use of general revenues, since every
segment of society has some responsibility for handling the
problem of solid waste sites. Your legislation also moves a
number of non-EPA Superfund activities outside EPA's Superfund
budget and eliminates EPA's practice of transferring funds to
other Federal agencies for ``Superfund support.'' API strongly
supports this move.
If EPA focuses on completing the program's original mission
of cleaning up those remaining sites on the NPL, and if it
fully implements the GAO management recommendations, Superfund
expenditures can be reduced. That will further limit the amount
of general revenues required.
With Superfund's mission nearly complete, now is the time
to plan for the future. We agree with you and Senator Smith
that this is the time to begin ramping down Federal programs.
Your bill moves in that direction by proposing to limit the
number of sites that will be added to the NPL during the next
few years, and by transferring administration of cleanup
activities to the States for final disposition.
Once again, we appreciate the opportunity to testify in
support of the Superfund reform proposal, and we commend you
for your steadfast efforts dedicated to improving the Superfund
program.
Thank you, Mr. Chairman.
Senator Chafee. Thank you very much, Mr. Cavaney.
Mr. Mike Ford, on behalf of the National Association of
Realtors?
STATEMENT OF MIKE FORD, NATIONAL ASSOCIATION OF REALTORS
Mr. Ford. Mr. Chairman, thank you for the opportunity to
present the views of the National Association of Realtors on S.
1090, the Superfund Program Completion Act of 1999. I wish to
thank Chairman Chafee and Chairman Smith for their continued
and determined leadership in building bipartisan consensus on
this very important issue. Senator Lautenberg is from our area,
I know he's not on the bill, but he's been very involved in the
environment in New Jersey over the years.
My name is Mike Ford. I own a full service residential and
commercial real estate company in Clark, New Jersey. I've been
a real estate broker for 25 years.
It is often said, and I agree, that realtors don't sell
homes, we sell communities. The more than 730,000 members of
the National Association of Realtors, real estate professionals
involved in all aspects of the real estate industry, are
concerned and active members of our communities. We want clean
air, clean water, clean soil. We want to see properties
affected by historic pollution cleaned up and returned to the
marketplace. We care about health, quality of life, as well as
a vibrant economy. We are willing to do our part to maintain
the important balance.
However, we also expect some fairness, certainty and
predictability from government regulators that our customers
expect from us. In this respect, Superfund has clearly failed.
Superfund began with laudable goals of cleaning up
hazardous waste sites to protect human health and the
environment. Progress has been achieved, and for that, the EPA
deserves credit. Unfortunately, progress has come at a high
price. While serving as a mechanism for hazardous waste
cleanups, Superfund has also served as an engine for massive
litigation.
Deep pocket parties targeted by EPA have turned around and
sued smaller parties. Many of these smaller parties are small
business owners who did nothing more than dispose of common
garbage, recyclers who tried to be environmentally conscious
and innocent property owners who have not caused or contributed
to hazardous waste contamination, have been drawn into years of
costly litigation defending against the threat of huge cleanup
liability.
As a first step, these parties should be provided with the
maximum degree of liability relief so that resources can be
targeted toward cleanup rather than litigation. When it comes
to Superfund cleanup, we must ensure the real polluters pay, so
that the hazardous waste sites are returned to productive use
as soon as possible. From the perspective of taxpaying
citizens, it is the right thing to do to ensure that Superfund
is administered in a fair and effective manner. From the
perspective of businessmen, it also provides the certainty
needed in order to move forward in developing sites that are
known or suspected to be contaminated.
As a second step, the Federal Government should recognize
and support hazardous waste cleanup efforts underway at the
State level. In an effort to revitalize urban centers, most of
the States, including my home State of New Jersey, are
creatively attacking the hazardous waste problems by providing
incentives to voluntary cleanup programs.
One common incentive provided by the program is liability
relief. Typically, the State will provide some sort of relief
once it has approved the cleanup. In New Jersey, the relief
comes in the form of a no further action letter from the DEP.
Unfortunately, there is no guarantee that the Federal EPA will
not assert authority at a future date and require additional
cleanup. Without the certainty of knowing that they are
protected from Federal as well as State liability, property
owners and developers are very reluctant to undertake
development of a site that may be contaminated.
In New Jersey, we have our fair share of hazardous waste
sites. However, you see what we can accomplish when local,
State and Federal Government work together. In my home town of
Clark, General Motors cleaned up a contaminated site and funded
construction of a golf course. The local government now runs
the golf course and makes a healthy profit on it.
If these reforms are achieved, hazardous waste sites
throughout the country will be returned to productive use,
revitalizing communities by increasing their tax base, creating
jobs and rejuvenating neighborhoods. Otherwise, it will remain
barren, contributing to nothing but economic ruin.
S. 1090 presents a win-win opportunity for everyone by
achieving cleanup of hazardous waste sites, encouraging
property use and enhancing community growth. Now is the time
for Congress to assert bipartisan leadership and reinforce our
nationwide effort to turn brownfields into green fields. The
National Association of Realtors supports S. 1090. We encourage
the 106th Congress to act now on Superfund reform.
Thank you again for the opportunity to present the views of
the National Association of Realtors.
Senator Chafee. Well, thank you very much, Mr. Ford.
Ms. Florini, you've heard this testimony that seems to be a
constant drum beat here about the brownfields problem. It's a
very serious one, and it seems to me the witnesses have wisely
pointed out that this is an environmental issue, it isn't just
a safety or health issue. Because if we can use these lands
within the city, then they don't go outside in these lovely
fields and develop industrial parks and gobble up the land, so-
called urban sprawl.
But you've also heard that what they seek, I think Mr. Ford
touched on it, others have touched on it, is some finality in
this thing, somehow have it done with, that a site is clean and
then the potential purchasers can proceed with some sense of
security that they're not going to be second guessed by EPA
coming in later on.
Could you give me your thoughts on all that?
Ms. Florini. First of all, yes, obviously we strongly
support brownfields redevelopment. As I tried to allude to in
my oral statement, we do in fact strongly support the
prospective purchaser liability relief. I think I've been on
record supporting that for several years now.
I think the rhetoric of the finality issue is confusing two
different issues. The one relates to relief for purchasers. But
as I just said, we support relief for purchasers. What I do not
support is the further step of providing what I believe is
windfall liability relief for sellers, sellers who have been
liable for 20 years under Superfund and who under the
provisions of this bill as I read it would be allowed to have
States waive their future liability.
I don't believe that is in fact necessary. I don't think
that most of the people who have focused on the need for
finality as an incentive for additional brownfields development
have differentiated between the two different parts of it. I
think that is in fact something that does and should be taken
into consideration.
Senator Chafee. Do you have any thoughts on that, Mr. Ford?
Mr. Ford. Finality is an important issue. When you're
cleaning up in New Jersey, under the DEP auspices, and if
you're constantly worried that the EPA is going to come in and
reevaluate the site, give you more cleanups, not agree with
what the DEP has agreed to, no one wants to clean up under
those auspices. It's not a practical consideration. You're
digging into a deep well, and then the EPA is going to come in
and make it a deeper well to clean up.
Senator Chafee. Senator Baucus.
Senator Baucus. Thank you, Mr. Chairman.
Ms. Florini, I wonder if you could comment a bit on whether
or not it makes sense to extend the Superfund tax, either or
both of its two components, as we look toward eventual
completion of cleanup.
Ms. Florini. Yes, I think it does make sense to reimpose
the Superfund taxes at this time to provide an assured and
specific funding source for the program.
Senator Baucus. Why do you say that, even though as you
know, under our very arcane and nobody understands them budget
rules here that a dollar is a dollar, whether it's Superfund
tax or whether it's general revenue or what-not, why is that
necessary?
Ms. Florini. Well, Senator Baucus, if you don't understand
the budget process, I``m certainly not going to lay claim to do
so.
[Laughter.]
Senator Baucus. But you know what I'm talking about.
Ms. Florini. Yes. The original concept behind creation of a
trust fund supported by dedicated taxes was that it would both
create an incentive for appropriators to be more likely to
actually go ahead and appropriate the funds, and also establish
the polluter pays principle in two ways, not just in the
liability provisions of the statute, but also by tying the
taxes to a group that is at least more connected to the
creation of the Superfund sites than the general public is. So
to the extent that there are expenses associated with the
Superfund program that are not feasibly cost recoverable, then
the taxes are there to provide the funding to pick up that
burden.
Senator Baucus. What do you think the chances are that the
money will be there to pay for the cleanup if there is no
extension of the tax?
Ms. Florini. I think I need to go back to my original
response to your question, Senator. I honestly don't know the
response to that question.
Senator Baucus. Well, as many know, there is a problem
here. One of the problems is relying exclusively on general
revenue. The problem there is that we have at this point anyway
budget caps. As a practical matter, the total number of dollars
that will be available under the Appropriations Subcommittee
will be about $12 billion in current spending, $12 billion less
than current spending. So that Appropriation Subcommittee is
going to have to figure out where it is going to cut the money.
In addition, the bill itself authorizes levels at about 25
to 30 percent lower than current. If the Superfund tax is not
extended, even though technically those dollars are not
necessary for Superfund, although psychologically, the more
that it's there, the more than it helps, there's going to be a
problem, it seems to me, on whether or not this program is
going to become even close to being funded at the levels most
people in the country expect it to be. Do you agree with that
statement or not?
Ms. Florini. Yes, that does in fact reflect, I think, where
things stand, which is why we do indeed believe that the taxes
ought to be reimposed. Certainly one of the things we find most
objectionable in the bill is the ramp-down on authorizations.
Senator Baucus. And the caps on new listings?
Ms. Florini. Yes, definitely oppose that as well.
Senator Baucus. How do we get to completion? Obviously
there are lots of complaints about the current program. You
heard a lot of the discussion about finality and how there is a
chilling effect on local communities to develop sites for fear
that there will be some liability here and so on and so forth.
Obviously, we're all basically working toward the same solution
here, to complete cleanup as reasonably as possible, complete
it, but complete it reasonably but do it well. How do we get
just generally there? Do you have an overall thought about
that?
Ms. Florini. We stay the course. I think at this point it's
very clear that the pace of cleanup has accelerated
dramatically over the last few years. In fact, the
environmental community is having some concerns that in some
instances, at least, quick may be being now traded off by EPA
for good. That's just a general footnote.
But clearly, we do not reduce the resources being made
available to the program in a way that would curtail the pace
of progress. And we do not make a number of, we do not fiddle
with the law, we do not change the fundamental liability and
the fundamental cleanup.
Senator Baucus. Mr. Reilly, I will give you a chance to
answer that one.
Mr. Reilly. Would you repeat the question, Senator?
Senator Baucus. Any one of the questions.
[Laughter.]
Senator Baucus. Basically, from your perspective, obviously
it's the tax.
Mr. Reilly. The issue of the tax is near and dear to our
heart. It hits industry widely, disparately. But for those who
feel as though the polluters are not paying right now, I guess
I'll take the occasion to remind you that every single site
where Du Pont is involved and any other company is involved,
and that's over 70 percent of the NPL sites, we're paying our
fair share probably by a factor of 3. We pay for whatever the
heck our liability is at the site, based on the neutral that we
bring in, or the courts. There's generally a large number of
orphan parties, the owner or operator is defunct. We pay for
that share.
And then we also pay for the oversight costs that EPA
engages, basically spending our money from the fund to oversee
us. We have to pay that money back. So we're paying by a factor
of three as it is. If you want to reimpose the Superfund taxes,
then we overpay by a factor of four. I think that's a fair way
to characterize it.
Senator Baucus. CMA did support the tax, though,
previously, like in 1984 for example? Or in 1994, it supported
the tax?
Mr. Reilly. In the context of a comprehensive reform of
Superfund and in the context of taking a look, especially now
that we're toward the end of the pipeline, Senator, we want to
make sure the program is funded adequately. If in the end that
requires some contribution by the companies, you can count on
us.
Senator Baucus. It's also true that if the only
contribution to pollution is petroleum, that petroleum is
exempt, oil and gas is exempt.
Mr. Reilly. I'd rather you ask that to the petroleum
industry, Senator, we're a chemical company and we have no
exemptions.
Senator Baucus. So I understand, but is there another way
to recast this tax? My staff will hate me asking this question.
Can we revise it in some way or deal with it in some way, so
that the funds are there to pay for the cleanup?
Mr. Cavaney. First of all, people talk about the tax, the
concept of polluter pays. I want to reinforce what Mr. Reilly
said, it is that in the large, large, large majority of the
Superfund sites where remediation is underway, there is a
responsible party. So you do in fact have a connection. The
taxes were originally put forth to be able to fund orphan or
abandoned sites, for which are only 7 percent of the remaining
sites.
It appears to me that if you're going to look at a
comprehensive reform package, then you could also look at taxes
from that perspective. But in the current environment, there
are very few people who think a very comprehensive package will
be able to get through Congress and be signed.
So we strongly support making gains where we can. We think
the gains included here in the Chafee-Smith bill go in the
right direction and establish a lot of precedence.
Senator Baucus. When we enacted Superfund in the Congress,
in 1980, the committee report language basically said we in the
Congress want to provide a fund to finance response action for
liable party non-cleanup. Then we said, third, base the fund
primarily on contributions from those who have been generically
associated with such problems in the past and who today profit
from products and services associated with such substances.
I understand what you're saying and you make a very good
point, it's well taken. But it is true also, isn't it, that if
the only contribution is petroleum or petroleum feed stocks
that the petroleum industry is not liable?
Mr. Cavaney. Under the current view, EPA says we are
responsible for far less than 10 percent of the sites. Yet
historically we've paid 57 percent of the taxes. That's over $8
billion since the fund started, and that's in addition to the
$8 billion we've paid in cleanup under Superfund and under the
State cleanup and other Federal statutes.
Senator Chafee. Senator Crapo.
Senator Crapo. Thank you, Mr. Chairman. I'll followup a
little bit on that question, but maybe with some other members
of the panel. In response to some of my earlier questions, it
turns out that the Governors' Association, the Attorney
Generals Association and ASTSWMO do not really have strong
objections to reimposition of the taxes in the context of this
discussion. I can take it that Mr. Reilly and the Petroleum
Institute do have a strong opposition to that. Ms. Florini
would support the reimposition of the taxes.
I'd like to know where the other members of the panel come
down on that. Mr. Gregor, do you have a position on that? Would
your support for the bill be impacted by whether the taxes were
reimposed?
Mr. Gregor. I think from the standpoint of local
government, we're probably a little more neutral on the revenue
source and more concerned that there be adequate funding to
meet the demand of site work that needs to be done.
Senator Crapo. I take that to mean, then, that if a
decision to reauthorize the taxes were made, that would not
cause you to withdraw support for the bill?
Mr. Gregor. That's correct.
Senator Crapo. Mr. Nobis?
Mr. Nobis. Usually in the case of a small business like
ourselves, dealing with a Superfund site, usually what they are
trying to recover in costs from us is pretty small. To me it
would seem that a lot more money would be saved if they really
wouldn't come after the small businesses. In my community, they
spent millions of dollars just trying to collect the millions
they were trying to get from us. I would think there would be
more money available to clean up these sites if the small
businesses were eliminated from having to pay for the cleanups.
They could use that money for the attorneys to go to the
cleanup of the sites.
Senator Crapo. What about the question of reauthorization
of taxes, however? Do you have a position on whether the taxes
should or should not be reauthorized?
Mr. Nobis. I would think for a small business like
ourselves, we really don't understand much about
reauthorization of the taxes. To us, it's just that we really
need to have relief from this. It seems like so much money is
spent on trying to collect the small amounts from the small
businesses that that money could be used for the cleanup of the
landfill. In our case, most of all the money that was actually
used or collected from us didn't go to the cleanup of the
landfill at all, it went to just the attorneys.
Senator Crapo. Mr. Ford?
Mr. Ford. Since the National Association of Realtors, we
broker property, the tax issue wouldn't really affect us either
way. Our sole purpose is, we want the properties cleaned up,
put back on the marketplace so we can market them again. But
the tax issue would really not make a difference to us either
way.
Senator Crapo. So in other words, your support for the bill
would not be lost if the taxes were in there?
Mr. Ford. Definitely not.
Senator Crapo. Mr. Reilly, obviously there is a question of
the taxes and the reauthorization. A question that I raised
earlier also is whether the EPA can get around the caps on the
NPL listings as well as some of the other efforts to try to
bring the States more into involvement through the use of 106
orders or other aspects of EPA authority.
Do you think that the legislation we see right now does
provide the necessary protections?
Mr. Reilly. We very much support the recognition that the
States have got the capacity to work their brownfields issues,
work their voluntary cleanup programs. We very much support the
issues in the bill where the States can give finality. Now, we
take a look at the relief valves that are in the bill, and to
us they appear more than adequate if there is an emergency, or
if the State decides it wants to bring EPA back in. Those
relief valves are there.
Then implicitly, Senator Crapo, the agency has full
authority under 106 orders to come in and order parties to
clean up the site. I think one of the earlier panels made it
sound as thought a company might just blow off a 106 order.
Well, 106 orders carry a penalty of $25,000 a day. I'm not sure
many companies would disregard an order like that.
Senator Crapo. Does CMA have a position on this bill?
Mr. Reilly. We consider it an excellent, we consider it a
very good bill. And we really haven't had to take a firm
position on it. We were delighted to hear at the beginning of
the day that the Chair and the rest of the panel are going to
talk to EPA, so maybe we don't have to take a firm position one
way or the other, because the ground is shifting as we speak.
We think it's a good bill.
Senator Crapo. So at this point, there is not a stated
position of CMA on the bill?
Mr. Reilly. That's correct, Senator.
Senator Crapo. I have no further questions.
Senator Chafee. Thank you, Senator.
I want to thank the panel. I'm sorry that Ms. Miller was
not able to be here in time. Where is Ms. Miller? Apparently
she arrived late, and as I understand, if she has a statement,
we will put that in the record.
As I announced earlier, tomorrow's hearing will be
postponed, at the request of Ms. Browner, and we're going to
have a chance to meet on the bill. If anybody has anything
further they wish to put into the record, they will have until
June 1st to do so.
Thank you all very, very much for coming. We appreciate it.
[Whereupon, at 12:50 p.m., the committee was adjourned, to
reconvene at the call of the Chair.]
[Additional statements submitted for the record follow:]
Statement of Hon. Bob Graham, U.S. Senator from the State of Florida
Mr. Chairman, members of the committee, thank you for the
opportunity to speak on an issue that is very important to the State of
Florida: Superfund reauthorization.
Florida currently has 46 active sites on the National Priorities
List. An additional 19 sites are being cleaned up by the Florida
Department of Environmental Protection under their State cleanup
program. The General Accounting Office's November 1998 report
identifies 269 sites in Florida that are classified as awaiting an NPL
decision. Florida therefore has a vested interest in the future of the
Superfund cleanup program.
The State of Florida has also initiated a brownfields cleanup
program to address underutilized industrial properties across the
State. These sites may have low levels of contamination present as a
result of previous industrial activity, but do not qualify for the NPL.
However, many property owners are concerned that even after a site is
cleaned up to the State's satisfaction, the EPA may require additional
action. This lack of certainty about future Federal liability can
inhibit development of the property, contributing to urban blight and
suburban sprawl.
I look forward to working with my colleagues to find a way to
revise existing Superfund law to encourage cleanup of brownfields. In
addition, we need to revise Superfund's liability provisions to treat
contributors of small quantities of waste fairly and to encourage
recycling of materials to conserve our natural resources. Administrator
Browner has initiated a variety of administrative reforms at the
Environmental Protection Agency over the years to address these issues,
and I look forward to discussing where we go from here.
__________
Statement of The Honorable Jim Marshall, Mayor of Macon, GA, on behalf
of The U.S. Conference of Mayors
Mr. Chairman and members of the committee, I am Mayor Jim Marshall
of Macon.
I am pleased to appear today on behalf The U.S. Conference of
Mayors, a national organization that represents more than 1,050 U.S.
cities with a population of 30,000 or more.
I presently serve as a co-chair of the Conference's Mayors and
Bankers Task Force, a role that I share with Mayor Paul Helmke of Fort
Wayne.
Mr. Chairman, the Conference's statement addresses a number of
areas pertaining to the legislation before this committee today.
It addresses key issues for mayors in this debate, noting
particularly the need for liability relief and ``finality'' to promote
brownfields redevelopment.
It discusses why Congress needs to act on legislation to further
the efforts of cities and other communities in recycling brownfield
properties. It presents new information on the scope of the brownfields
problem and benefits of positive policy reforms, a discussion which
largely focuses on the results of the Conference's Second Annual
Brownfields Survey that was released last month.
It offers our perspectives on the status of lender support of
brownfields redevelopment, particularly how legislative reforms can
help stimulate additional private sector investment in these sites.
Finally, it reviews how your legislation, ``Superfund Program
Completion Act of 1999'' (S. 1090), responds to key issues raised by
mayors on brownfields and selected Superfund reforms.
Key Issues for Mayors
Mr. Chairman and members of this committee, you are well aware of
the mayors' continuing interest in securing legislative reforms to
Superfund, particularly issues pertaining to brownfields redevelopment.
My colleague, Fort Wayne Mayor Paul Helmke, recently appeared
before you to talk about the challenges of urban growth and the
preservation of open space. His comments added to the substantial
record of this committee on the need for legislative reforms to
Superfund and other actions supporting the recycling of brownfields.
As we review the legislation--``The Superfund Program Completion
Act of 1999 ``--before this committee today, the Conference believes
you have crafted a series of reforms that will help move brownfields
redevelopment forward in assisting local efforts to recover these sites
and return them to more productive use. These reforms, we believe, will
help us move to the next level, beyond simply ``comfort letters'' on
liability and limited grant commitments for assessments and cleanups.
Most mayors will tell you that the major impediment in securing
private capital for the clean up and redevelopment of brownfields is
Superfund's liability regime.
We believe that:
1. It is time to free innocent parties, both public and private
entities, from Superfund's unfair liability strictures. Parties that
had no part in causing the contamination at individual sites should no
longer be held liable under Federal law.
2. It is time to create more certainty for the current owners of
contaminated properties--the hundred of thousands of sites in every
place in America that are likely to be brownfields at some time in the
future--by providing them certainty in their cleanup costs and
liability exposure. Owners of non-Federal interest sites need certainty
about the rules that apply to them, certainty about the costs to
remediate these sites and certainty that their actions terminate the
risk of future liability.
Mr. Chairman, your legislation reflects your understanding of these
issues and the need to deal specifically with the challenges before us
in addressing the many thousands of brownfields that already exist and
to take steps now to reduce our predisposition toward creating more
brownfields in the future.
In explaining our views on innocent parties, let me provide some
further perspectives from our vantage point as mayors. We have been
living under a Federal statute and its strict liability regime--
although well-intended and largely aimed at more contaminated
properties posing greater threats to the public--that has dramatically
slowed progress by all parties in coming to terms with lesser
contaminated properties, sites we generally describe as brownfields.
It has produced a legacy of inaction by property owners, be they
innocent or responsible parties, which we now measure in terms of
thousands of properties and millions of acres. In our National Survey,
which I discuss later, 180 cities provided estimates of the acreage of
brownfields in their communities. The total acreage exceeds the
combined land area of the cities of Seattle, San Francisco and Atlanta.
And, we don't believe that continuing charges of who is or who is
not more protective of the environment, etc. is in tune with the
reality of what is happening in America. The nation will continue to
warehouse acre upon acre of contaminated soils and materials for the
foreseeable future, until we respect the scale of this problem and the
many complicated dimensions associated with our current liability
regimes.
Rhetoric and political advantage will not cleanup one brownfield,
but bipartisan legislative action will. We all need to put aside
political posturing and confront the challenge before us.
I would note, however, that have serious concerns about the
proposed termination of the Superfund program at this juncture and the
absence of a plan to reinstate the feedstock taxes. We believe that
continued dialog on these issues and forward progress on the
legislation are the best way to bring these issues to closure on a
bipartisan basis.
As a mayor and a sometime expert on real estate law, we are taking
on a daunting task as we seek to enact reforms and policies to undo the
substantial ``liability fear'' which is now part of our investment and
development psyche.
Mr. Chairman, your legislation moves the process forward, and we
support your efforts in this regard.
Today, I want to focus on two key issues in this debate.
First, acting on the innocent party liability relief is a threshold
issue.
Your legislation offers new standards for absolving innocent
parties of liability under Superfund. When mayors talk about this
issue, they are most often focusing on brownfields. The Conference
strongly believes that innocent party-relief is the crucial first step,
legislatively, in encouraging more private sector attention to and
investment in the clean up and redevelopment of brownfields.
As a mayor and a representative of local governments, I encourage
you to revisit these provisions to grant further relief to cities and
counties who already hold, in public ownership, substantial inventories
of these sites. The relief you have provided doesn't fully account for
the many properties that have already been acquired by cities and other
public agencies. For example, many sites now owned by cities were
acquired in the normal course of performing local government functions,
and many of these were acquired involuntarily. This is not the same
thing as a private party acquisition, and as such, should be treated
differently.
We believe that innocent party relief, including further
consideration of -existing local government holdings, will move private
investment forward on many sites, particularly in cases where the
property is abandoned or substantially underutilized and where the
parties who caused the contamination are long gone. But, this is only
one part of the equation.
Second, ``finality'' must be provided to prompt current owners to
move forward and cleanup contaminated properties.
The issues surrounding what some might call ``active brownfields''
is perhaps the biggest challenge before us. Active properties--those
now in use and underutilized and those that are inactive due to
concerns about liability--remain the most difficult challenge for
mayors and other public officials, and most certainly for the Congress.
First, we support efforts to delineate among classes of properties
and to allocate authority for final disposition of these properties
between U.S. EPA and State governments. The Conference endorses reforms
that respect State authority to administer their voluntary cleanup
programs for non-NPL properties, without Federal intervention except
under very limited and extraordinary circumstances.
I would note that your legislation has provided a narrower range of
EPA authority than what is provided in the bipartisan legislation (H.R.
1300) offered by Representative Sherwood Boehlert.
On a related issue, I would also note that have not fully vetted
your proposal on vesting the States with broader authority on NPL
listings.
This balance between State autonomy to act and make final decisions
affecting these properties versus the limited or no Federal interest in
these properties needs to be brought to closure. Clearly, we have
proven by the vast inventories of existing brownfields and those in
progress that current law doesn't work.
This issue continues to be driven by seemingly abstract debates
about unreasonable constraints on EPA's role in this area. Under
existing law, we know that EPA has rarely, if at all, intruded upon
State decisions on non-NPL or non-NPL caliber sites. The price of
keeping EPA over-empowered in this area is simply too high. At the end
of the day, all of us need to keep our eye on the goal--it is about
creating a more efficient and effective way of getting responsible
parties, who are often the current owners of these sites, and
prospective purchasers engaged in cleaning up these properties and
returning them to more productive use.
Closure on the issue of finality is the larger problem for
brownfields and properties in active use where contamination exists.
The threat of Federal liability and Federal enforcement action, albeit
limited in practice, strongly influences private and public behavior,
be it current owners or potential developers, of these sites.
In my own community, we have many properties, which are likely
contaminated and are essentially ``mothballed.'' Owners wait out the
system, dragging down neighborhoods and hurting the broader community's
effort to improve conditions in the city. Meanwhile, sprawl is
continuing unabated, extracting more life from our existing
neighborhoods and communities. This is the life cycle that the current
liability regime sustains.
The practical effects of this policy are not felt here in
Washington or at the EPA offices, but rather by the citizens in
individual neighborhoods and the communities where these properties are
located. Today, we generally have to live with the decisions by owners
and their choices in managing their properties, behavior that is
strongly influenced by the punitive nature of the current Federal
liability regime. We see property after property that is contaminated
and fenced off in every community in this nation, producing what are in
effect the ``gated communities'' of industrial America.
Mr. Chairman, we know that your proposals are intended to break
through this impasse. We don't believe there is one right answer to
this problem, but we believe that you have offered a viable solution to
this problem. Broader State empowerment, at this juncture, is so much
better than the current system. The Conference would be pleased to work
with you on these provisions as you work toward bipartisan consensus on
these issues.
Why Congress Needs to Act on Legislation
Mr. Chairman, we would like to begin by acknowledging your efforts,
and those of others on this committee, to seek legislative reforms to
help communities address brownfields and other burdens under Superfund.
Securing consensus on legislative reforms to the Superfund law,
with a particular emphasis on brownfields, is a top priority for the
Conference of Mayors. The Conference believes the time has come to act
decisively and promptly on brownfields and selected Superfund reforms.
Mr. Chairman, the Conference also acknowledges and appreciates the
many efforts by the Administration, particularly U.S. EPA Administrator
Carol Browner, and others in Congress who have supported policies and
initiatives, such as funding for local brownfields programs, to further
our efforts to recycle America's land. These programs and policies have
certainly helped, and again let us underscore that we are very
appreciative of these efforts. But as a nation, we are not making
progress at a rate that is quick enough or substantial enough given
other considerations, which we discuss further in this statement.
The problem of not redeveloping brownfields and our appetite for
using open space is of epidemic proportions and we believe that, to
date, our collective actions fail to match the challenge before the
nation.
Anyone who examines the brownfields issue acknowledges the
importance of adopting broader strategies to promote the redevelopment
of these sites. And, they also share a sense of urgency in acting
promptly to address this national problem.
For our part, we have tried to articulate why action and leadership
by the Congress is needed. We have also directed our efforts in support
of bipartisan efforts to move legislation forward. We also believe that
taking on the substantial challenge of brownfields requires broad
consensus among Democrats and Republicans, on many fronts. And, such
consensus needs to be enduring over time, because the nature of this
problem does not lend itself to a one-time legislative correction.
We anticipate working with you and future Congress' on redirecting
the tax code, infrastructure investment patterns particularly in
transportation, and other policies in the environmental arena and in
housing, to make recycling our nation's land part of the nation's
development life cycle.
We envision a broader commitment by Congress to challenge
investment practices and public, private and individual decisionmaking
that unnecessarily consumes our precious greenfields, as brownfields
are discarded.
We also believe that the Congress and the Administration must
answer this challenge through bi-partisanship, which explains why the
Conference has been steadfast in urging bipartisan action. To
underscore our commitment to this principle, the Conference leaders
recently wrote to the President, urging him to work with you, Mr.
Chairman, and others in Congress on these issues.
We also believe that mayors and many others have helped established
a record on the need for Federal policy reforms and other actions to
deal with brownfields in a more comprehensive manner.
Mr. Chairman, when Mayor Helmke testified before you, he talked
about many of these issues during your recent hearings on urban growth
and open space. We commend you and others on this committee for
dedicating the time to these issues.
Your legislation responds to many of the key issues he talked about
relative to helping us recycle these properties and putting them back
into productive use. And, he explained, and mayors agree, that
brownfields redevelopment is one of the most effective strategies we
have in slowing the rate of consumption of open space and farmlands in
proximity to urbanized areas.
These reasons explain why the nation's mayors are strongly
supporting bipartisan legislative efforts to redirect Federal policies
and further engage with our communities in tackling the brownfields
problem.
New Information on Scope of Brownfields Problem and Benefits of
Positive Policy Reforms
Mr. Chairman, we are pleased to provide you and this committee with
the findings of the Conference's Second Annual Brownfields Survey.
Information from this report supports many of our statements about why
legislation is needed. It also substantiates many of the key provisions
in your legislation.
We have provided you with a copy of the full report. In this
statement, we provide some of the key findings to simply amplify what
we believe are key issues before the committee today as you prepare for
action on pending legislation.
First, the findings confirm that brownfields are a national
problem, which is--very broad in scope. Our results are drawn from more
than 220 cities, a sample of cities, both large and small, in 39 States
and Puerto Rico.
In our survey, 180 cities reported that, collectively, their more
than 19,000 brownfields sites represent more than 178,000 acres, a land
area which I already noted is larger than the cities of Seattle, San
Francisco and Atlanta combined. This sample size represents a
relatively small universe of the nation's more than 20,000
municipalities, suggesting a scale to the problem that is disturbing at
best.
Cities were asked to identify the obstacles to redeveloping
brownfields in their communities. Of the top three responses, the need
for cleanup funds were identified as the No. 1 obstacle, followed by
liability issues and the need for environmental assessments. The
ranking of these obstacles is the same as last year's survey of about
140 cities.
Mr. Chairman, we note that your legislation deals directly with the
top three issues that were identified in our survey. S. 1090 addresses
liability issues affecting innocent public and private parties for
prospective purchasers and contiguous landowners. Your legislation also
specifically authorizes funding for assessments of these sites and
funding to clean them up.
We also found that three out of every four cities expressed the
view that their communities will need additional resources beyond
cleanup funds and assessment funds to help them redevelop brownfields.
This finding underscores earlier points in this testimony about the
need to look at the tax code and other incentives as well as how
infrastructure investment dollars are being deployed.
The survey also documented the substantial benefits that can be
realized for cities and the Nation through the redevelopment of these
sites. About two-thirds of the respondents provided estimates of local
revenue gains which could be realized through redevelopment of
brownfields. Collectively, they estimated the potential local revenue
gains of nearly $1 billion annually under a conservative estimate and
about $2.7 billion annually under an optimistic estimate.
In a related area of inquiry, we asked cities to provide us with
estimates of how many new people they could absorb without adding
appreciably to their existing infrastructure. While 180 of the
respondents indicated they could -absorb more people, only 115 could
provide actual numbers.
Astoundingly, these 1 15 cities reported that they could absorb
more than 3.4 million without adding appreciably to their
infrastructure, a population about equal to the City of Los Angeles,
our nation's second largest city. To put these numbers in another
context, this capacity is equal to about 16 months of the nation's
population growth.
In a relatively small sample of municipalities nationwide, albeit
generally larger ones, the survey provides clear evidence of the
substantial, incumbent carrying capacity of existing communities. If we
can find ways to tap these capacities, it offers the potential for
substantial savings to all of the nation's taxpayers. Consider the
potential savings to the Nation if we can minimize the public and
private costs of building the equivalent of one new Los Angeles City
every 16 months over the next decade.
Consider the implications in terms of our consumption of land. If
we pursue broad policy initiatives, like an expanded commitment to
brownfields and other means to reinforce existing communities, we could
slow consumption of our farmlands and open spaces as well. As one
example of such supportive policies, the Conference has previously
indicated the mayors' support for Congressional action on the ``Better
America Bonds'' proposal.
In the area of job creation, 168 cities estimated that reuse of
these brownfields could generate more than 675,000 jobs. This supports
our claims that there are vast opportunities to develop jobs in
existing urban areas and neighborhoods, a particularly important
finding as we continue to implement welfare reforms emphasizing welfare
to work.
Finally, in our findings on the status of State voluntary cleanup
programs, cities reported that where such programs were in effect, a
sizable majority indicated that these programs were at least
satisfactory, if not better. Alternatively, you can describe these
results more negatively by combining cities that indicated the
questions on State voluntary programs were not applicable with those
giving their State a ``not very good'' or ``poor'' ranking. Under this
method, more than one-half of the respondents indicated that voluntary
cleanup programs didn't apply or they were ranked poorly. This
assessment suggests the need for further investment in State voluntary
cleanup -programs, as you have provided in S. 1090.
Overall, we believe that these findings strongly support the thrust
and intent of key provisions in S. 1090 in advancing local efforts to
assess, cleanup and redevelop brownfields in communities all across the
nation.
Status of Lender Support of Brownfields Redevelopment
Mr. Chairman, as you know, the Conference has been working
extensively with bankers and other financial interests to explore ways
to increase investment in brownfields redevelopment.
Last year we formed the Mayors and Bankers Task Force to work with
representatives of the Federal Home Bank System to examine ways to
facilitate investment by FHBS member banks in brownfields.
We have learned that liability under Superfund is their dominant
concern. Despite progress in securing ``comfort letters'' at many sites
and growing confidence in State program efforts, there is real anxiety,
and we would wish otherwise, among bankers and other lenders on these
issues. The specter of Superfund liability severely limits their
ability to increase the flow of private capital into these projects.
We have heard repeatedly--in our work with members of the Federal
Home Loan Bank System and in our other activities with financial
interests--that lenders are not willing to move aggressively on
brownfields until there are legislative reforms to Superfund.They have
told us that the private sector is prepared to substantially increase
capital flows to projects on brownfield sites as soon as Congress
enacts legislation that explicitly shields innocent parties from
Superfund's liability scheme.
Today, we are enjoying the benefits of one of the longest economic
expansions in our nation's history. If there is a time to enact changes
to stimulate private sector investment in these sites, it is now. This
is the time to demonstrate to investors and others--when private
capital is plentiful and available for new investment opportunities--
that brownfields redevelopment can be successful. Such successes will
help carry future efforts to attract investment in brownfields during
the leaner times which will inevitable come as the economy moves to
other cycles.
Mr. Chairman, when mayors talk about brownfields, our Federal
partners sometimes only hear us asking for Federal partnership
resources in support of brownfields redevelopment, as if mayors are
suggesting that public resources alone will solve the brownfields
problem. As you know, mayors are fairly attuned to the realities of our
market economy. We know that the private sector is the dominant
investor and the pivotal actor in determining how successful we, as a
nation, will be in recycling brownfields.
It also explains the particular priority we place on ensuring that
any legislation include liability protections for innocent third
parties.
However, conversely, we also know that a market economy, fueled by
liability reforms, doesn't respond fully to the problem either. There
are many types of brownfields in all circumstances and locations. For
these reasons, we also know that public investment is crucial in
defining our success in recycling these sites.
Again, Mr. Chairman, your legislation accounts for these realities
by providing resources directly to communities to help us assess and
clean up these sites, providing us with added resources and capacities
to partner with the private sector.
``Superfund Program Completion Act of 1999''
Mr. Chairman, finally, let me amplify further some of our views on
specific provisions of the legislation before this committee.
First, I want to again note the liability reforms provided in your
legislation, an area that was just discussed earlier in my statement.
These provisions need to more fully address the many circumstances
where cities and other public agencies unfairly find themselves subject
potentially to Superfund's strict liability standards.
The legislation makes important changes to relieve cities and other
local governments of liability exposure in their ownership or
management of brownfield properties acquired after this legislation
become law. As I noted earlier, the Conference urges you to include
additional liability relief to account the many circumstances where
local governments, in their operations and activities, have previously
acquired such properties. We believe that H.R. 1300 provides an
excellent model for the provisions that would address these issues.
S. 1090 authorizes funding for both assessment efforts and local
cleanup programs, providing criteria to help U.S. EPA determine how to
deliver these resources in support of local programs. We are pleased
that the bill expressly authorizes these commitments to site assessment
and cleanup. We also urge you to provide Congressional appropriators
with more flexibility in future years to increase commitments to these
activities.
We are pleased that the legislation provides some resources to help
States further strengthen their voluntary cleanup programs. We hope
that States will use these funds to place some priority, where needed,
on efforts to bolster their States programs in support of brownfields
cleanups.
Considering the many thousands of such sites all across the
country, we would certainly encourage the committee to explore how
these funds could help State programs, particularly those focused
largely on NPL-caliber sites, to address brownfields more responsively.
We would also encourage you to consider ways to incentivize States
to deliver simplification of the cross-cutting rules which are
applicable at brownfield sites, such as how to rationalize the rules
and program requirements under RCRA and LUST with provisions under this
legislation.
We are also pleased that this legislation clarifies the balance
between State and Federal program authority, as I discussed earlier.
Without more certainty about State authority and decisionmaking, we
can't hope ever to provide the necessary assurances sought by
responsible parties and potential investors in developing brownfield
sites.
In addition to these brownfields-related provisions, we also wanted
to underscore our support for liability reforms that limit municipal
liability at Superfund sites where municipal solid waste was disposed.
We support the provisions you have provided to limit the liability of
cities and counties at such sites and offer them more certainty on
their liability costs.
We do not believe it was Congressional intent to have municipal
solid waste and municipal sewage sludge considered as a hazardous waste
under CERCLA. Various studies have documented that municipal solid
waste has been found to contain less than one-half of one-percent (.5
percent) toxic materials. We therefore support the provisions that
exempt generators and transporters of MSW from liability and limit
liability for municipal owners and operators of co-disposal landfills.
Mr. Chairman, the Conference supports extension of the Superfund
taxes. While we understand your rationale for not including the tax
extension in your pending legislation, we also believe that it is very
important to secure legislative agreement to reinstate these taxes as
soon as possible.
Closing Comments
Mr. Chairman, we want to express again our thanks to you and
members of this committee for holding this hearing today and for your
continuing efforts to move this important legislation forward in the
106th Congress. The nation's mayors believe that the time has come for
bipartisan Congressional action on brownfields and selected Superfund
reforms.
On behalf of The U.S. Conference of Mayors, we appreciate this
opportunity to share the view of the nation's mayors on these important
issues.
__________
Statement of Mayor Thomas Suozzi, City of Glen Cove, New York
Chairman Chafee, Senator Baucus, and distinguished members of the
committee, thank you and good morning. My name is Tom Suozzi. I am the
Mayor of the City of Glen Cove, New York a small city on the Northem
Shore of Long Island with a population of 25,000 and a land area of
seven square miles. I am pleased to be here today to testify regarding
the needs of local governments for municipal Superfund liability
relief.
I am here representing eight national municipal organizations that
have worked together for many years to seek municipal Superfund
liability relief so that we can resolve our involvement at these toxic
waste sites, reduce litigation and transaction costs, and get on with
the business of cleaning up and recycling these blighted sites into
productive redevelopments in our communities. These organizations
include American Communities for Cleanup Equity, which was formed
nearly a decade ago to address these municipal Superfund issues, as
well as the American Public Works Association, the Association of
Metropolitan Sewerage Agencies, the International City/County
Management Association, the International Municipal Lawyers
Association, the National Association of Counties, the National
Association of Towns and Townships, and the National League of Cities.
Collectively, our organizations represent thousands of cities, towns,
counties, and local agencies across the United States. We are
responsible for the health, safety and vitality of our communities and,
at the same time, for fulfilling the governmental duty to provide for
municipal garbage and municipal sewage collection and disposal.
First and foremost, we thank you, Senator Chafee, for your
leadership and your commitment to addressing the issue of municipal
liability in Superfund legislation. We also commend Senator Lautenberg
for championing Superfund relief for local governments for many long
years. Indeed, as you know, there has been broad, bipartisan, multi-
stakeholder consensus on this municipal Superfund relief issue for many
years. We hope that the parties will continue to work to get this
municipal Superfund issue resolved, this year, no matter what other
issues may stand in the way.
Local governments have a very serious problem. We have been saddled
with years of delay, and millions of dollars of liability and legal
costs under the Superfund law simply because we owned or operated
municipal landfills or sent municipal solid waste or sewage sludge to
landfills that also received industrial and hazardous wastes. Local
governments have faced costly and unwarranted contribution suits from
industrial Superfund polluters seeking to impose an unfair share of
costs on parties that contributed no toxic wastes to these so-called
``co-disposal landfill'' sites. We estimate that as many as 750 local
governments at 250 sites nationwide are affected by the co-disposal
landfill issue. The costs that our citizens bear as a result are unfair
and unnecessary.
Local governments are in a unique situation at these co-disposal
sites. First, municipal solid waste and sewage sludge collection and
disposal is a governmental duty. It is a public responsibility to our
communities that we cannot ignore, and we make no profit from it.
Second, the toxicity of municipal solid waste and sewage sludge has
been shown to be significantly lower than conventional hazardous wastes
and, as such, represents only a small portion of the cleanup costs at
co-disposal landfills.
The City of Glen Cove has experienced the threat of costs and delay
associated with this Superfund issue. Located on the north shore of
Long Island, Glen Cove has ten miles of beautiful waterfront, three
public beaches, 300 square miles of nature preserves, and historical
mansions built by some of America's wealthiest business leaders. One
mile of that waterfront is a toxic Superfund dump and brownfield site.
A World War II era munitions plant, the Li Tungsten plant, contaminated
the site with low-level radioactive waste. This contamination included
the dumping of radioactive and hazardous waste at an adjacent site that
once was a municipally owned open dump, which is now part of the
Superfund site. For many years, the Li Tungsten plant was a productive
part of our community and economy. It was our largest job provider, the
biggest contributor to the tax base, the supporter of community
activities like the Little League team. Today, Li Tungsten has no jobs,
provides no taxes, it no longer contributes to community activities
like the baseball team. The site stands dangerous, polluted, and
abandoned.
The process of resolving the City of Glen Cove's municipal
liability at this site has taken many years, and many dollars. In
addition, at a different Superfund site, the Kin-Buc landfill in New
Jersey, the City of Glen Cove was sued by industrial polluters seeking
an unfair share of contribution because our city had transported
municipal trash to that site. That legal process was likewise lengthy
and costly. That's why Glen Cove supports legislative enactment of a
municipal Superfund liability policy that will provide a simple,
expedited, and fair method for resolving local government liability
associated with these co-disposal Superfund sites. Glen Cove has been
recognized as one of 16 national Brownfields Showcase Communities for
its pro-active efforts to cleanup and redevelop its contaminated
waterfront, and we will continue to do so. However, the costs and delay
associated with the threat of Superfund co-disposal litigation has
hindered communities across the nation, like Glen Cove, from focusing
their energy on the vital cleanup and reuse initiatives that we need to
be pursuing.
Indeed, there is broad consensus that municipalities need and merit
liability relief. For nearly a decade, our coalition has worked with
you and other Members of Congress, and with the U. S. Environmental
Protection Agency, to formulate a reasonable solution to the problem.
In February 1998, with our support, the EPA finalized an administrative
settlement policy to limit liability under Superfund for generators and
transporters of municipal solid waste and sewage sludge, and for
municipal owners and operators of co-disposal landfills. We continue to
support this reasonable and fair EPA policy, and commend EPA for
playing a pro-active role in seeking to address a very complicated
problem.
However, as fair and appropriate as the administrative policy is,
we strongly believe that legislative action to resolve the municipal
Superfund liability issue is necessary and justified. First, the EPA
policy is only a policy, non-binding on the Agency and subject to
change or challenge. Second, this policy has already been the subject
of litigation, and the real threat of further litigation involving
local governments remains. While we will continue to defend the EPA
policy in court, as we did in Federal court in 1998, and to advocate
its use by our members, we believe a change in the Superfund law to
address this issue is necessary to reduce the costly litigation and
delay that municipalities may continue to face at co-disposal sites.
Third, we believe that legislative enactment of municipal Superfund
liability provisions will give localities the certainty and confidence
to make use of this settlement mechanism--much as the codification of
lender liability Superfund provisions has provided certainty for the
banking industry.
For these reasons, we support a legislative resolution of the
municipal co-disposal liability problem. We believe the provisions of
the Superfund Completion Act, and the bill introduced yesterday by the
Senate Democrats, generally would accomplish that objective, and we
welcome any legislative proposals that will effectively address our
specific concerns with this issue.
Specifically, we have following remarks about the need for
municipal Superfund liability clarification:
We support liability caps for generators and transporters of
municipal solid waste and sewage sludge, based on a per ton assessment.
We believe that local governments who delivered municipal solid waste
or sewage sludge to a landfill in good faith should have the option to
settle out their liability at a reasonable and fair rate. The $5.30 per
ton assessment in the Superfund Completion Act, also found in the EPA
settlement policy, was determined based on an analysis of post-closure
costs at RCRA Subtitle D landfills--in other words, the best estimate
for what it would have cost the local government to close the facility
if the facility were not a Superfund site contaminated with other
parties' toxic waste.
We support liability caps for local government owners and operators
of co-disposal landfills, based on a percentage apportionment of
liability. We believe that local governments generally should have the
option to settle out their liability for 20 percent or less of the
total cost of site cleanup. In addition, we believe that the liability
share borne by local governments should be aggregated when two or more
local governments, who owned or operated the facility either
concurrently or sequentially, are identified as potentially responsible
parties.
We agree that the Environmental Protection Agency should be
required to notify municipalities if they are eligible for the
municipal solid waste and sewage sludge settlement mechanisms outlined
above. Likewise, we support the approach of providing expedited
settlement mechanisms to eligible municipalities. Finally, we support
the approach of precluding third-party contribution suits or
administrative Superfund orders against eligible municipal parties
prior to their opportunity to settle their liability, or after they
have settled their liability.
We believe the ability-to-pay provisions of the law should apply to
local government parties utilizing the municipal liability caps.
We support the legislative language that protects from liability
those owners and operators of publicly owned treatment works or
``POTWs'' that, at the time of a release or threatened release, were in
compliance with their Clean Water Act pretreatment standards under
Section 307 and were not otherwise negligent in operating or
maintaining their sewer system. Without specific protection from
liability, otherwise innocent POTWs can be exposed to Superfund
liability from industrial discharges into the public sewer system.
We believe that there will be no orphan shares created by municipal
co-disposal settlements, because the liability caps provided in both
EPA's policy and the Superfund Completion Act represent municipalities'
fair share of liability associated with trash and sewage sludge, based
on long-standing and comprehensive analysis of the effect of such MSW
and MSS at co-disposal landfill sites. However, if a ``statutory orphan
shares'' provision is enacted as proposed in the Superfund Completion
Act, we wish to emphasize that the requirement for an EPA assessment of
such orphan shares should not have any effect of delaying the
settlement of municipal liability under the co-disposal provisions.
In summary, the local government organizations on whose behalf I am
testifying today believe a legislative resolution of municipal co-
disposal Superfund liability is of critical importance. We believe the
Superfund Completion Act, and the Senate Democrats' proposal, generally
would achieve that objective.
I also wish to comment on behalf of these municipal organizations
on the importance of enacting brownfields funding and liability
clarification law in this Congress. There is widespread consensus among
local governments, business, and environmental and community groups
that we need to put our brownfields back into productive reuse.
Localities have had difficulty obtaining the resources necessary to
assess, remediate and clean up the thousands of brownfields sites that
impact nearly every American community. And the continuing uncertainty
regarding the clarification of potential liability issues at brownfield
sites has hindered the redevelopment of these areas. Local governments
therefore support legislative approaches that provide liability
clarification, brownfields remediation grants and loans to local
governments and private parties, and continued assessment dollars. We
commend the senators for addressing this topic, and urge you to carry
it through into the enactment of a new brownfields law.
Thank you, Mr. Chairman, for the opportunity to testify. I would be
happy to answer any questions you or other members of the committee
might have.
__________
Statement of Tom Curtis, Director of the Natural Resources Group,
National Governors' Association
Good morning, Chairman Chafee, Senator Baucus, Senator Smith,
Senator Lautenberg, and members of the committee. My name is Tom Curtis
and I am Director of the Natural Resources Group at the National
Governors' Association. I am pleased to be able to appear today on
behalf of the National Governors' Association (NGA) concerning a
subject that is a perfect example of how environmental and economic
development issues crosscut: brownfields revitalization and the
Superfund.
As you know, NGA is a bipartisan organization. Our policy
recommendations on Superfund and other issues can only be adopted by a
vote of at least two-thirds of the nation's Governors and are generally
supported by far more impressive majorities. We have certainly found
that to be the case with Superfund. Our policy for the reform of this
program is based on the States' experience as managers of thousands of
site cleanups under State programs and as partners with EPA in many
other cleanups at National Priority List (NPL) sites. That is to say,
our views on this matter have been shaped not by politics, but by a
common commitment: the Nation needs hazardous waste cleanup programs
that are workable and efficient. Superfund reform has not been a
partisan issue among Governors, and we hope sincerely that it will not
become one in this Congress.
As you know, the States have a strong interest in Superfund reform
and believe that a few critical changes are needed to improve the
Superfund program's ability to clean up the nation's worst hazardous
waste sites quickly and efficiently. We know that there remain
important differences between some of the key players in the Superfund
debate, but we see the Superfund Program Completion Act of 1999 (S.
1()9()) as a significant step toward resolving those differences.
Clearly, Important compromises have been made in the development of
this legislation, and we hope the spirit of compromise will continue on
a bipartisan basis.
We are committed to doing everything within our power to assist you
in your efforts moving this bill through the legislative process. We
hope to continue working cooperatively with both the majority and the
minority to develop a final bill that enjoys broad bipartisan support
and can be signed by the President.
I will focus my remarks this morning on the two key provisions of
the legislation that the Governors strongly support: brownfields
revitalization and voluntary cleanup programs, and the Governor's right
of concurrence with new additions to the MPL. In both of these areas,
the bill provides for flexibility and certainty, which States need to
ensure quick and successful cleanups.
Brownfields Revitalization and Voluntary Cleanup Programs
The Governors believe that brownfields revitalization is critical
to the successful redevelopment of many contaminated former industrial
properties, and we commend you, Mr. Chairman, for making the
brownfields issue a critical piece of this legislation.
In considering how to restore brownfields sites to productive use,
please remember the importance of State voluntary cleanup programs in
contributing to the nation's hazardous waste cleanup goals. States are
responsible for cleanup at the tens of thousands of sites that are not
on the National Priorities List. A survey completed by the Association
of State and Territorial Solid Waste Management Officials reported that
33 responding States currently have 27,235 sites in State cleanup
programs. To address these sites, many States have developed highly
successful voluntary cleanup programs that have enabled sites to be
remediated quickly and with minimal governmental involvement. For each
of the past 5 years, States have completed work on an average of 1,475
sites and have completed roughly 485 removals. It is important that any
legislation supports and encourages these successful programs by
providing the clear incentives and flexibility States need to continue
them.
The Governors believe that this bill provides clear incentives and
flexibility to carry out State voluntary cleanup programs. There is no
question that voluntary cleanup programs and brownfields redevelopment
are currently hindered by the pervasive fear of Federal liability under
the Comprehensive Environmental Response, Compensation, and Liability
Act (CERCLA) of 1980. Many potential developers of brownfields sites
have been deterred because even if a State is completely satisfied that
the site has been properly addressed, and even if the site is not on
the NPL, there is the potential for EPA to take action against the
cooperating party under the CERCLA liability scheme. The bill addresses
this problem by precluding enforcement by anyone at sites where cleanup
has occurred or is being conducted under stale programs and by
providing needed liability protections for innocent owners and owners
of property contiguous to contaminated sites. In the instance where a
State is unable or unwilling to take action at a site, there are
reasonable exceptions to this preclusion of enforcement.
The Governors believe that it is appropriate for EPA to take action
at a site if a State makes such a request. We also commend you for
including provisions that would allow EPA to come into a site only
after EPA has given the Governor notice and an opportunity to cure.
Without this very important provision, EPA would have the authority to
take action at a site for virtually any reason. However, if the State
has the opportunity to cure, the EPA will only be allowed into the site
if the State cannot cure and not because EPA happened to discover new
evidence before the State takes action.
The nation's Governors believe that the provisions in your title on
State voluntary cleanup programs would greatly encourage voluntary
cleanup and thus increase the number of cleanups completed. All
Governors are vitally interested in cleaning up hazardous waste sites
in their States so that we can provide a cleaner environment for future
generations. These provisions will enable States to cleanup hazardous
waste quickly and safely and that is good for our environment.
Governors Concurrence in New NPL Listings
Another provision that is important to the nation's Governors
concerns the requirement for a Governor to request the listing of a
site before a State's site may be added to the NPL. The nation's
Governors believe such a provision is vital.
There has been a great deal of discussion in recent years about the
future of the Superfund program, and this legislation anticipates and
plans for the completion of the Superfund program. EPA has told us that
remedy decisions have been made at eighty-five to 90 percent of all NPL
sites and that construction is underway. We believe that with the
growth and maturity in State programs since the inception of the
Superfund program, there will be a natural process of relying more and
more on States to do most of the cleanups.
Because of differences in capacities among States, the complexity
and cost of some cleanups, the availability of responsible parties.
enforcement considerations, and other factors, there needs to be a
continuing Federal commitment to clean up sites under some
circumstances. However, because States are currently overseeing most
cleanups, listing a site on the NPL when the State is prepared to apply
its own programs and authorities is not only wasteful of Federal
resources, it is very often counterproductive. resulting in increased
delays and greater costs. The Governors fear a case where there will be
``two masters'' of the cleanup process. This is confusing to the
remediating party and to the general public and an inefficient use of
remediation resources.
To avoid this, we advocate that Governors should be given the
statutory right to concur with the listing of any new NPL sites in
their States. The bill accomplishes this by providing for the request
of a Governor before a site can be added to the NPL. In the event EPA
discovers an imminent and substantial threat to human health and the
environment, of course, it could continue to use its emergency removal
authority, but any assignment of liability must then be consistent with
liability assigned under State cleanup laws. We very much appreciate
your recognition of this important provision.
However, we are concerned with the provision that places a cap on
additions to the NPL at 30 sites per year. Our position has been that
the statutory right of Governors to concur with listing serves as an
effective limitation on NPL listings. We fear an unforeseen scenario
where a catastrophe occurs and more than 30 sites are in legitimate
need of being listed and receiving Federal resources. We ask that you
remove this provision from the bill and rely on the Governor's
concurrence provision to provide an effective limitation on unnecessary
NPL listings.
Before I conclude my remarks, I would like to comment on several
other provisions that we believe are necessary. S. 1090 provides for
much-needed brownfields funding for site assessment and remediation,
and we applaud you for this provision. We believe that financial
assistance is a critical Federal responsibility and this provision will
assist in the identification and cleanup of contaminated property. The
bill provides for a State cost share of 10 percent for remedial action
and the costs operations and maintenance. The provision is important to
many States that would otherwise feel the financial burden of paying
for 1()() percent of operations and maintenance.
Conclusion
Mr. Chairman, I would like to thank you for your hard work on this
important reform legislation and for providing me with the opportunity
to communicate the views of the nation's Governors on Superfund reform.
I have attached a copy of the NGA policy statement on Superfund reform
and ask that it be included in the record of this hearings along with
my statement.
The nation's Governors appreciate your hard work in developing this
proposal, and they believe that passing Superfund legislation in the
106th Congress is critical. S. 1090 is an effective bill that we urge
members of both parties to support. We hope that members of both
parties will roll up their sleeves to pass Superfund reform
legislation. The Governors look forward to working with both the
majority and minority to bridge any differences and assist in crafting
legislation that can be signed into law.
I will be happy to answer any questions you may have.
______
Responses of Tom Curtis to Additional Questions from Senator Voinovich
Question 1: What is the appropriate Federal role, if any, at sites
that are considered ``state interest''?
Response. The nation's Governors believe that the appropriate
Federal role for the Federal Government at ``state interest'' sites is
financial assistance. The Governors believe that Federal dollars that
go to states for program assistance are critical. In addition, the
Governors are very supportive of the grant program in S. 1090 that
would give moneys to states for brownfield assessment and remediation.
The Governors' have also advocated a Federal role in state sites
where certain conditions are met. In Title II of S. 1090, the U.S.
Environmental Protection Agency (EPA) would be prohibited from taking
enforcement actions at a site where a cleanup is being conducted or has
been completed under state voluntary cleanup laws. The bill would allow
EPA to take action at one of these sites if one of several conditions
were met. Examples of these conditions are if a state requests EPA to
come into a site or if there is a public health or environmental
emergency and the state is unable or unwilling to take appropriate
action. The Governors believe that these reopeners represent an
appropriate role for the Federal Government in these sites.
Question 2: Is there a clear way to distinguish Federal interest
from state interests in the Superfund program?
Response. We believe that the National Priorities List (NPL) is an
appropriate distinction between Federal interests and state interests.
If a site is not on the NPL, we believe that the site is in the state
interest. If EPA would like to take action at a site, then it should
have to meet one of the reopeners addressed in the response to Question
#1 or list the site on the NPL, subject to a Governor's concurrence.
I again thank you for the opportunity to testify and for the chance
to respond to additional questions for the record. If I can be of any
assistance as you continue to develop a bipartisan Superfund reform
package, please contact me directly. I look forward to working with you
on these very important issues.
__________
Statement of Claudia Kerbawy for the Association of State and
Territorial Solid Waste Management Officials (ASTSWMO)
Good morning. I am Claudia Kerbawy and I am the Chief of the
Michigan Superfund program. I am also the primary spokesperson on
reauthorization issues for the Association of State and Territorial
Solid Waste Management Officials (ASTSWMO) and am here today
representing ASTSWMO. ASTSWMO is a non-profit association which
represents the collective interests of waste program directors of the
nation's States and Territories. Besides the State cleanup and remedial
program managers, ASTSWMO's membership also includes the State
regulatory program managers for solid waste, hazardous waste,
underground storage tanks, and waste minimization and recycling
programs. Our membership is drawn exclusively from State employees who
deal daily with the many management and resource implications of the
State waste management programs they direct. As the day-to-day
implementers of the State and Federal cleanup programs, we believe we
can offer a unique perspective to this dialog and thank you for
recognizing the importance of the State perspective.
ASTSWMO and individual States have participated in the debate to
reauthorize the Superfund law for the past three congresses. We wish to
extend our gratitude to Senators Smith and Chafee for drafting a bill
which appears to acknowledge the evolution of the Superfund program and
the important role that States currently play in remediating
contaminated sites. I would like to dedicate the first part of my
testimony to speaking on the accomplishments of State programs. As with
the Federal Superfund program, most State programs have had the benefit
of 18 years to grow and mature in infrastructure capacity and cleanup
sophistication. We believe it is very important that Congress
understand the actual status of State programs, in order to make a
fully informed decision regarding the future of the Federal Superfund
program. The second part of my testimony will be devoted to analyzing
key aspects of S. 1090 from a State program manager's perspective.
astswmo state accomplishments study
The Association of State and Territorial Solid Waste Management
Officials recently conducted a study on the accomplishments of State
cleanup programs. The association asked States to provide detailed
information on all short-term removal actions and long-term remedial
actions conducted between January 1, 1993 and September 30, 1997 for
each site in the State system where hazardous waste cleanup efforts
were performed by States directly, under State enforcement authority,
and under State voluntary cleanup and property transfer/brownfield
programs. Sites listed on the National Priorities List, Resource
Conservation Recovery Act corrective actions and underground and above
ground storage tank and other petroleum spills were not included in
this study. The association received information on 27,235 sites from
33 responding States. I should note that the primary ground rule for
the study was that information had to be reported site-specifically and
had to be accompanied by background data. Estimates were not accepted
or counted as part of either the individual State or national totals
for work accomplished.
While this study does not capture the complete site universe either
on a national level or individual State level, it is the view of
ASTSWMO that enough information was obtained to confirm that a trend
has developed whereby on a national level States are not only
addressing more sites at any given time, but are also completing
(construction completes) more sites through streamlined State programs.
State programs have matured and increased in their infrastructure
capacity.
Key results of the ASTSWMO study included:
States have completed seven times as many sites per year these last
four and three-quarter years than they did during the first 12 years of
the program. During the first 12 years of the program, States completed
202 sites per year on average. Over the last four and three-quarter
years, States have averaged 1, 475 completions per year for a total of
6,768 completions. State managers believe the large increase in
completions can be attributed to the growth of State programs, the
advent of State Voluntary Cleanup programs and the development of State
cleanup standards (i.e., clearly defined endpoints).
States have completed almost twice as many removals per year during
the last four and three-quarter years of the program than they did
during the previous 12 years of the program. On a national basis,
States completed approximately 48 removals per year as compared to 293
per year during the first 12 years of the program. This doubling of the
pace of removals indicates a substantial increase in risk reduction the
field.
Three times as many confirmed contaminated sites have been
identified and are working their way through the State system than
during the first 12 years of the program. During the first 12 years of
the program, States had approximately 1,850 sites working their way
through their systems at any given time. Today, States are addressing
an average of approximately 4,700 sites at any given time. NOTE: the
word ``address'' could refer to site remediation, no further action
designations, or site prioritizations. These findings clearly show that
States programs have matured and State infrastructures have increased
in their capacity to identify and address more sites.
Only 8.9 percent (2,426) of the total sites identified by States
(27,235) were classified as inactive. As the data indicate, State
capacity to address large numbers of sites has increased dramatically.
Most sites are being actively worked on by States either through
traditional State Superfund programs or through voluntary cleanup
programs and it is the professional judgment of the ASTSWMO membership
that the majority of sites classified as inactive are probably of lower
relative risk and not destined for the NPL due to the triage system
employed by most States.
analysis of s. 1090 ``the superfund program completion act of 1999''
brownfields and state response
ASTSWMO wishes to commend the committee on the drafting of titles I
and II of S. 1090. These are well crafted titles containing provisions
which ASTSWMO can fully support. First, ASTSWMO supports the National
Governors' Association position that Governors' should be given the
statutory right to concur with any new National Priority Listing (NPL)
in their State. We believe the facts support that position. States
today employ a triage system whereby, the worst sites are addressed
first. For example, only 8.9 percent (2,426) of the total sites
(27,235) identified by the recent ASTSWMO survey were classified as
inactive. It is, therefore, the strong belief of the ASTSWMO membership
that most sites that have been identified within a State that could
qualify for listing on the NPL are already being worked on by the
State.
We believe the views of our membership were validated by the recent
General Accounting Office (GAO) Report entitled, ``Hazardous Waste:
Unaddressed Risks at Many Potential Superfund Sites''. In this report
the GAO reviewed the status of 3,036 sites which had pre-scored above
28.5 but for a variety of reasons had not been placed on the NPL. Out
of a total of 3,036 sites only 7.6 percent (232) were estimated by both
EPA and State officials to potentially warrant listing on the NPL. This
confirms that the EPA regional staff had utilized good judgment in not
placing the vast majority of these sites on the NPL; it also confirms
that the hazard ranking system could be improved.
The question before this committee is what should be the
appropriate role of the Federal Superfund program in the future? While
there may be 40 plus States with State Superfund programs and Voluntary
Cleanup programs there will always be States who choose not to develop
a program and Federal Government assistance may be warranted. There
will also be sites which due to either technical or legal complexity or
cost, a State either cannot or may prefer to have the Federal
Government address. The point I wish to stress is that with the current
status of State programs the choice as to whether a site is addressed
by the Federal Government or State government should be determined by
the State. A Governor should be able to make the determination of
whether a site will be listed on the NPL as specified in the S. 1090
mandate that a site must receive Governors' concurrence prior to
listing on the NPL. While it is EPA policy to routinely seek
concurrence from the Governor before a site is listed on the NPL, it is
not -mandatory that the concurrence be received. If a dispute should
arise between EPA and a Governor the process within EPA is to have the
Assistant Administrator for OSWER make the final determination.
Frankly, that is not a satisfactory policy.
Fortunately, there are very few sites where the States and EPA
disagree, however, when a dispute does occur the site quickly becomes
high profile and both the State and Federal Government can lose
credibility. As indicated by the ASTSWMO survey and GAO survey, the
States have clearly become the primary regulators for overseeing site
remediation. The NPL should be reserved for those sites which both the
State and Federal Governments believe warrant expenditure of Federal
resources. The NPL is no longer reserved for the ``worst of the worst''
sites, rather the NPL has shifted to a venue for remediating sites
which require Federal resources. The criteria for listing sites on the
NPL may quickly shift from one of risk based determinations to one
based on resource needs. We, therefore, support the provision for
Governors concurrence as outlined in S. 1090.
Second, States are responsible for remediating the vast majority of
sites in this country and while it is crucial to clarify the issue of
who actually will determine in the future whether a site is listed on
the NPL; it is equally as important to clarify which governmental
entity will be given the responsibility for determining when a site is
fully remediated. In other words, the concept of finality needs to be
addressed. The Federal Superfund statute technically applies to any
site where a release occurs. However, the reality today is that States
are responsible for ensuring the remediation of all sites which do not
score above 28.5 using EPA's Hazard Ranking System (HRS)--the cutoff
for Federal listing on the NPL. The EPA removal program is able to
address some sites which are not listed on the NPL, but the program is
designed to stabilize a site, not to ensure the full remediation of the
site. EPA can not expend fund money for remediating a site not listed
on the NPL. Consequently, the State is often still responsible for
completing the remediation of a site even after an EPA removal action
has been performed at a site.
It is our belief that Congress needs to decide definitively whether
EPA should retain a role in the remediation of non-NPL sites. While in
practicality EPA has little or no role at these sites and as our survey
indicated, the States are addressing the large universe of non-NPL
sites, the statute still maintains a role for EPA In theory. Although
the majority of these sites (typically brownfield sites) will never be
placed on the NPL, they are still subject to CERCLA liability even
after the site has been cleaned up to State standards. It is our belief
that we can no longer afford to foster the illusion that State
authorized cleanups may somehow not be adequate to satisfy Federal
requirements. The potential for EPA overfile and for third party
lawsuits under CERCLA is beginning to cause many owners of potential
Brownfields sites to simply ``mothball'' the properties. We believe it
is imperative that Congress seek to clarify the State-Federal roles and
potential liability consequences under the Federal Superfund program.
States should be able to release sites from both Federal and State
liability once a site has been cleaned up to State standards. In
situations which are deemed emergencies end where the State requests
assistance, we believe the Federal Government should be able to address
the site and if necessary hold the responsible party liable consistent
with liability assigned under State cleanup law. Emergency actions
should be the only exceptions to such releases from Federal liability.
This has been a very contentious issue and we understand that many
in the Administration have raised objections to provisions of this
nature. We do not agree with the basis for these objections for several
reasons. First, EPA does not have the ability to compel parties to take
remedial actions at sites not listed on the NPL, except for removal
actions. Second the majority of these sites will never be listed on the
NPL, therefore, EPA does not have regulatory authority to spend fund
money at these sites to perform the necessary remedial actions. Third,
if a State should release a site from State liability (of course, all
States have standard reopener provisions contained in their liability
releases), and a situation should develop which warrants Federal
attention, the State will act responsibly and contact EPA For example,
the State of New Jersey, as well as Michigan and many other States
throughout the country, has a very successful Voluntary Cleanup
program. The New Jersey program has remediated over 6,000 sites and
receives approximately 150 applications a month for entrance into their
Voluntary Cleanup program. One of those sites, the Hoboken site, was
remediated under the State Voluntary Cleanup program and a certificate
of completion was issued by the State. Previously unknown mercury was
later found to be present at the site and the State for financial and
technical reasons called EPA in to address the site. Unknown conditions
will occur at both NPL and non-NPL sites.
We recognize that situations such as the Hoboken site will occur
and believe that the exceptions specified in S. 1090 adequately address
the situation. While it is clear in emergency situations that EPA
should have the ability to enter a site, we believe the second prong of
the condition must also be met, i.e., with State concurrence similar to
our recommendation for listing sites on the NPL. We wish to avoid
duplication as much as possible and therefore believe that if a State
is capable of addressing the emergency then there is no need to utilize
EPA's resources. The States have proven they act responsibly in these
situations and it is to the State's advantage to notify EPA when either
the State's financial, legal or technical resources are not sufficient
to adequately address the problem.
We believe the universe of sites to be addressed by State Cleanup
(State Superfund and State Voluntary Cleanup) programs and the sites
eligible for releases from Federal liability is the non-NPL universe of
sites. It seems only practical to officially exclude proposed and
listed NPL sites simply for the fact that much work has already ensued
in order to place these sites on the NPL. Some suggest that the non-NPL
universe can be divided into two categories, NPL-caliber and low risk
sites. We are the primary regulators for non-NPL sites and we are here
to tell you that there is no clear line that differentiates these
sites. Many would suggest the bright line should be 28.5 (as determined
by the HRS), but there are two problems with using this arbitrary
cutoff. First, 28.5 is the quantitative scoring factor used to
determine if a site qualifies for placement on the NPL. However, this
figure is based on an arcane hazard ranking system which many EPA and
State managers admit is flawed, so much so, that EPA and State managers
in the GAO study identified only 7.9 percent of the 3036 pre-scored
universe of sites for potential listing on the NPL. Second, in order to
use the quantitative NPL-caliber designation, States would have to
score sites prior to admitting them to a voluntary cleanup program (a
suggestion we understand one EPA Region has made to a State). Clearly,
the pre-scoring of a site as a condition for entering a State Voluntary
Cleanup program would be a huge disincentive for marketing a State
Voluntary Cleanup program and would not serve to move this large
universe of sites to cleanup nor to facilitate economic redevelopment
of brownfields. Essentially, the program has operated for years on a
``you know it when you see it basis'' in identifying NPL-caliber sites.
This is bad public policy and should not be acceptable for
differentiating State and EPA roles and for providing certainty to the
process. If a site is not to be listed or proposed for listing on the
NPL, then the State should be free to address the site without EPA
interference and the site should be eligible for the same benefits as
any other site, such as liability releases. We believe legislation such
as S. 1090 is needed and hope that Congress chooses to recognize the
benefits of State programs which have had over 18 years to grow and
mature and which clearly have become the leaders in site remediation
today.
Third, we are also pleased that S. 1090 seeks to streamline the
program by providing a fixed State cost share, namely 10 percent of
remedial action costs and 10 percent of operation and maintenance
costs. The current cost share system has served only to exacerbate the
tension which exists between State Waste Agencies and the U.S. EPA.
Under the status quo the financial incentives for EPA and the States
are diametrically opposed when considering final remedies for a site
(States desiring more capital intensive remedies and EPA seeking
remedies with lower capital costs and higher operation and maintenance
costs). State Waste Officials believe this is a fair and well-reasoned
position.
fair share liability allocations and protections
As State Waste Managers, our principal concern is ensuring the
timely and effective cleanup of contaminated sites. We are not the
legal experts and therefore will leave the analysis of this title to
other State professionals. We would simply note, that the current
liability scheme may not be entirely equitable to some responsible
parties, but in the past it has provided a stable source of funding. We
understand that reforms are needed and understand that the goal of the
title is to insert a level of fairness into the program for parties
such as municipalities and small businesses. ASTSWMO is in favor of
providing relief to these parties so long as the pace of cleanup is not
sacrificed.
conclusion
In conclusion, while our membership has not had an opportunity to
conduct an in-depth review of S. 109O, or to reach consensus on the
bill's language, the initial impressions and reactions from our members
is favorable. The primary provisions outlined in S. 1090 are elements
ASTSWMO could support. These provisions appear to parallel ASTSWMO's
basic positions regarding Governors' concurrence, brownfield liability
release and State cost share. We are very encouraged and look forward
to working with the committee as the process continues.
__________
Statement of Gordon J. Johnson, Assistant Attorney General of the State
of New York
My name is Gordon J. Johnson, and I am a Deputy Bureau Chief of the
Environmental Protection Bureau in the of floe of New York Attorney
General Eliot Spitzer. I am appearing today on behalf of Attorney
General Spitzer and on behalf of the National Association of Attorneys
General (NAAG). We very much appreciate the opportunity to appear
before the committee to comment on S. 1090, the Superfund Program
Completion Act of 1999, and thank Chairman Chafee and the staff of the
committee for their consideration and assistance.
The State Attorneys General have a major interest in Superfund
reauthorization legislation. As chief legal of ricers of our respective
States, we enforce State and Federal laws in our States. We help
protect the health and welfare of our citizens, our environment and
natural resources. Because many steps in the Superfund cleanup process
necessarily involve legal issues, we often are called upon to advise
our client agencies--both response agencies and natural resource
trustee agencies--on how the law should be interpreted and implemented
to achieve the desired cleanup or restoration goals. We often are also
responsible for negotiating cleanup and natural resource damages
settlements, and when a settlement cannot be reached, it is our
responsibility to commence and litigate an enforcement action. We also
defend State agencies and authorities when Superfund claims are made by
the United States Environmental Protection Agency (EPA) and other
Federal agencies against them.
NAAG also has been deeply involved in the Superfund reauthorization
process for many years. At its Summer meeting on June 22-26, 1997, the
sole resolution adopted by the State Attorneys General addressed
Superfund Reauthorization; a copy of this bipartisan Resolution is
attached. The Resolution directly addresses many of the issues that are
the subject of S. 1090. The NAAG Resolution arose from the State
Attorneys General's recognition of the critical importance of the
Superfund program in assuring protection of public health and the
environment from releases of hazardous substances at thousands of sites
across the country. We want to make the tasks of cleanup and protecting
the public less complicated and more efficient, and to reduce the
amount of litigation and the attendant costs that result.
While the State agencies that administer cleanup programs are very
knowledgeable about the engineering issues involved in selecting
remedies and the cleanup process, it is the State Attorneys General who
can best evaluate the legal consequences of changes to the current
statutory scheme, such as how amendments likely will be interpreted by
the courts and the effect of the amendments on enforcement, settlement,
and cleanup. We are pleased that we will be able to bring to this
committee our insights and experience in administering the Superfund
statute.
introduction
In New York, our office has been litigating Superfund cases since
1981. A major impetus for the passage of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (CERCLA)
was the chemical dumps exemplified by the infamous Love Canal and
related Hooker Chemical Company sites in Niagara Falls, New York.
CERCLA provided both the Federal and State governments essential legal
tools to address the dangers posed by those and thousands of other
sites in New York and throughout the country.
Although there were significant problems in the Federal
implementation of CERCLA during the 1 980's, the current statute is now
getting the job done as intended. As a result of CERCLA, our of lice
and the State's Department of Environmental Conservation have been able
to obtain cleanups at over 600 hazardous waste sites in New York. While
State voters in New York approved bonding for and New York committed
$1.1 billion for site cleanups, because of the powers provided in
CERCLA, responsible parties have contributed more than $2.3 5 billion
toward site remediation and two-thirds of sites are being cleaned by
the private parties responsible for their creation. Most States have
had similar results. On the Federal level, some $10 billion of public
money has been saved because 70 percent of all remedial actions at
Federal Superfund sites are being performed by responsible parties.
A major reason for this success is that cleanup liability under
CERCLA is now clearly understood by responsible parties and government.
It was not always this way. In the 1 980's, the meaning of numerous
terms, the reach of the liability provisions, and the application of
the remedy selection provisions were the subjects of contentious
litigation. These lawsuits caused delays in cleanups, imposed
substantial burdens placed on Federal and State programs, and increased
everyone's transaction and cleanup costs. Those days are now over:
potentially responsible parties (PRPs) now know what the statute means
and where they stand, and thus most are ready to settle their liability
with government. EPA's practices also have evolved, and it knows what
it can require of PRPs. Moreover, EPA has developed practices that lead
to earlier settlements and the quicker implementation of remedial
decisions. Finally, the States' own Superfund programs have matured.
Many of them are modeled on or mainly utilize the Federal statute.
State officials too understand what CERCLA means and how to use it, and
can obtain appropriate cleanups at minimal taxpayer expense. The
message is clear: we must avoid changes to CERCLA that will reignite
the courtroom battles over the meaning, scope, and implications of the
law. At the same time, we must not lose sight of our primary goal--
cleanup of sites and protection of the public and future generations.
We have no desire to replay the 1980's, even though we were generally
successful in the courtrooms.
s. 1090
We are pleased to note that S. 1090 is a departure from earlier
bills arising in the Senate and House. S. 1090 contains some of the
revisions that have been sought by the States for years, such as the
cap at 10 percent for the State share of remedy operation and
maintenance costs. In addition, unlike many previous bills, S. 1090 is
limited in its overall scope and selective in its reforms. The bill
does not amend the remedy selection and natural resource damages
provisions of CERCLA. In many respects, those amendments that are in
the bill are more narrow than those previously proposed, and wholesale
alterations of existing statutory language are generally avoided. As a
result, the defense bar will have fewer opportunities for legal
challenges than under earlier reauthorization bills.
S. 1090 also includes a brownfields revitalization program, and
allows States to give cooperating PRPs protection from liability under
certain circumstances, measures that will assist States in implementing
their voluntary and brownfields cleanup programs. Unfortunately, other
needed revisions that Attorneys General have been seeking for many
years are not included. Clarification of the sovereign immunity waiver,
modification of the IRS code to allow natural resource trustees to
utilize the Fund to perform natural resource damage assessments, and
revision of the natural resource damages statute of limitations, among
other needed reforms, are not included in S. 1090.
Despite some improvements in the proposed amendments, there are
still serious problems with S. 1090's revisions to the liability and
allocation provisions of CERCLA. While NAAG supports appropriate
amendments to provide incentives to settle, reduce transaction costs,
and provide limited exemptions from liability for truly ``de micromis
parties'' and a reasonable limitation on liability for municipal solid
waste disposal, many of the provisions of S. 1090 are unclear or go too
far, shifting the costs of cleanup from polluters and responsible
parties to the taxpayers. The proposed mandatory allocation process is
unwise, and rather than making settlement easier and quicker, will
complicate and delay settlements.
Most critical, however, is the apparent defunding of the Superfund
program, which necessarily will shift hundreds of millions of dollars
more in costs, if not billions of dollars, to the States. We all wish
that there was no need for CERCLA and the Superfund program, but the
need is there and will be there for many years. Because operation of
existing remedies, construction of new remedies, response to new spills
and unaddressed sites, and governmental performance and oversight of
these activities must continue beyond 2004, it is important that
sufficient funds be dedicated to the Superfund program. When EPA lacks
the funds to perform, the burden will shift to the States, which do not
have sufficient resources to carry this burden alone. In addition, by
creating new liability exceptions at NPL sites and imposing limits on
listing new sites, we believe that S. 1090 will seriously erode the
operation of the Superfund program and inevitably shift its costs to
the States.
1. liability exceptions and allocation/settlement process
A. De minimis and de micromis parties
NAAG supports reasonable statutory changes that encourage early
settlements with de minimis parties and liability exemptions for truly
de micromis parties. However, it is important that these provisions be
narrowly and carefully written to avoid inappropriate releases from
liability and expansion of the ``orphan share'' that the Fund and the
States then may well have to pay. We note that CERCLA always allowed
EPA to settle matters quickly and in recent years EPA has been
aggressively entering into such settlements without any changes in the
law.
Section 122(g) of CERCLA would be amended by S. 1090, altering the
current authority regarding expedited settlements for de minimis
parties. De minimis status would be presumed if the volumetric
contribution is not more than 1 percent of the total volume. However,
creating a statutory presumption will not serve to encourage such
settlements and may have the opposite effect. For instance, at many
sites, 1 percent is not the appropriate de minimis level; it is either
too low or too high. The statutory presumption in S. 1090 allows an
upward deviation from the presumed 1 percent de minimis level, but not
downward, and then only if the President ``promptly identifies a
greater threshold based onsite-specific factors,'' information the
President is not always likely to possess because of the mandated
expedited nature of the settlement process. Indeed, the 1-percent floor
would exempt many contributors of waste at larger sites. For instance,
the Hardage Superfund site in Oklahoma received over 21 million gallons
of industrial waste during the 1970's, including plating wastes,
solvents, coal tars, PCBs, and petroleum refining waste. One percent of
the waste at the site is 210,000 gallons, an amount of hazardous waste
which can wreak havoc on the environment.
Moreover, creation of a presumption will lead to greater
transactional costs, for any deviation from a presumption provides an
additional ground for -non-settling parties to challenge the de minimis
settlement. PRPs also will litigate the issue of whether they are de
minimis based on the presumption, creating even further litigation and
higher transaction costs. A statutory presumption should be
reconsidered, and instead the appropriate de minimis level should be
set on a site-by-site basis without any statutory presumption.
Proposed Sec. 107(r) would exempt from liability ``de micromis''
parties that sent less than 110 gallons or 200 pounds of material
containing hazardous substances to a site. We support an exemption for
truly de micromis parties, such as Elk Clubs, pizza parlors, and Girl
Scout troops, that sent minimal amounts of low-concentration and low-
toxicity mixtures to a site. However, depending onsite-specific
circumstances and the type of hazardous substances involved, 200 pounds
of solid material or 110 gallons of liquid (which is more mobile than a
solid material and will usually have a weight of approximately 880
pounds--four times the weight exemption for solid materials) can
constitute a substantial contribution to a release. For instance, 110
gallons of a spent solvent, such as trichloroethylene, could
contaminate 10 billion gallons of drinking water to levels twice the
standard. We believe exempting such a party statutorily and
presumptively would be unfair and inappropriate, particularly without
full consideration of concentration or toxicity, and would lead to
extensive litigation by parties near the specified weight or gallonage.
B. ``Small'' Business Exemption
Section 107 of CERCLA would be amended by Sec. 301 of S.1090 to
include a new subsection 107(s), limiting liability at NPL sites for
small businesses which are current or former owners or operators,
generators or transporters. A ``small business'' is one that had no
more than 75 full-time employees, or its equivalent, in the taxable
year before receiving notification from the President that it may be
liable, or had less than $3 million in gross revenue for that year. If
the company qualifies, it escapes liability for costs and damages
arising from activity which resulted in the disposal or treatment of
material containing a hazardous substance at a facility before the date
of enactment of the subsection. The exception is not applicable if the
hazardous substance attributable to the business did or could
``contribute significantly to the cost of the response action'' at the
facility or is affiliated through ``any familial or corporate
relationship'' with a liable party (proposed Sec. 107(s)(1)(B)-(C)); or
if the business's activity which otherwise would give rise to liability
``is determined by a court or administrative body of competent
jurisdiction, within the applicable statute of limitation, to have been
a violation of any Federal or State law pertaining to the treatment,
storage, disposal, or handling of hazardous substances'' (proposed
Sec. 1 22(p)(2)(F)).
While NAAG supports appropriate relief to de minimis parties, the
wholesale exclusion of a large class of otherwise liable parties based
solely upon their size or revenues is unwarranted. With this exemption,
no matter the amount of material disposed, liability is forgiven. Even
if the business engaged in knowing, reckless, or grossly negligent
activity, liability is excused. Small businesses which committed
illegal acts would not be liable unless they happened to have been
caught and convicted ``within the applicable statute of limitation,''
thus rewarding the successful concealment of illegal activities.
Ability to pay is irrelevant, except that the very small number of
small businesses that would be disqualified from the exemption still
would be eligible for a reduction of their liability based on their
ability to pay. See, proposed Sec. 122(g)(1)(D)(i)(III). The exemption
would eliminate many PRPs, especially at municipal-owned, codisposal
facilities, and the Fund and the States would have to make up for this
share of liability. The States do not have the resources to absorb
these shares.
C. Innocent Owner Protection and Contiguous Property Exemption
In.contrast to such bills as H.R. 1300, which effectively exempts
current owners from liability, S. 1090 offers a more thoughtful
amendment at Sec. Sec. 103 and 104. The basic structure of the
provision remains in Sec. 101(35) and, in contrast to H.R. 1300, there
is no protection for an innocent landowner who knew or should have
known of the disposal of hazardous substances. S. 1090 does change the
standard for determining whether an owner should have known of the
disposal. To prove that the current owner had no reason to know, the
owner has to establish that it undertook all ``appropriate inquiries''
and exercised appropriate care (stopped the source, prevented future
releases and prevented exposure to past releases) . EPA has the
authority to adopt the ASTM standards and practices which describe
appropriate steps a new owner should take, or to adopt others, taking
into consideration various factors. Finally, there is a special
provision for property for ``residential or other similar use''
purchased by a ``nongovernmental or noncommercial entity,'' for which a
facility inspection and title search revealed no basis for further
investigation. This last special protection is problematical because of
the meaning of the phrases ``other similar use'' and ``noncommercial
entity'' is unclear. This language would need to be clarified before
NAAG could support it.
These amendments affect only those current owners related by
contract to responsible parties. If the current owner is not related by
contract, then the owner does not have to comply with the ``due
diligence'' provisions of Sec. 101(35), but only with the ``due care''
provisions of Sec. 107(b). However, it is possible, if not likely, that
courts will define what constitutes ``due care'' without regard to
whether the owner complied with the ``due diligence'' provisions of
Sec. 101(35). If that occurs, then the net result likely would be that
all current owners, possibly even if they have actual knowledge of the
disposal before buying, will escape liability as long as they cooperate
with the governments or other PRPs doing a cleanup by giving access and
staying out of the way. NAAG opposes such a very broad exemption, which
comes close to eliminating current owners from CERCLA liability. Such
owners will reap the benefits associated with a taxpayer-financed
cleanup of their properties, even though they paid very little for
their land given their knowledge-of contamination. While S. 1090
provides for a ``windfall'' lien, it is only available to the Federal
Government, not to States, and is only created upon sale of the
property. As a result, owners will receive the protections against
State enforcement but the State does not even get the lien's limited
benefit.
Given the protections given innocent owners and the current defense
regarding acts of unrelated third parties, CERCLA Sec. 107(b)(3), we
see little need for the contiguous owners provision of Sec. 102.
D. Recyclers Exemption
Under the new Sec. 107(u), there is no liability at any site for a
person arranging for the recycling of certain recyclable material upon
demonstration of specified requirements. ``Recyclable material'' is
defined to include (1) plastic, glass, textiles, rubber (not including
whole tires) and scrap metal, as well as minor amounts of material
incident to or adhering to such scrap; and (2) spent batteries. Special
rules are then provided for transactions involving these different
kinds of recyclable materials.
While we agree that recycling activities should be encouraged, we
are nevertheless troubled by this exemption because it still is too
broad and elements of it unclear. The special rules provide protection
to recyclers so long as they comply with various ``Federal''
regulations or standards. However, only State regulations and standards
are applicable in most States and there are no Federal requirements in
existence. Therefore, the recyclers will have nothing to comply with
and can act irresponsibly without incurring liability. Also, while
recyclers claiming the exemption are required to demonstrate that they
meet certain criteria, the bill is unclear on whether they, or EPA or
the States, must demonstrate that they used reasonable care in their
recycling activities.
The exemption is particularly inappropriate as it applies to spent
lead-acid batteries. Such batteries contain large quantities of lead,
an especially toxic substance. Much of the lead in these batteries is
in the form of lead oxide and lead sulfate, compounds that are
relatively mobile and bioavailable in the environment. The sulfuric
acid in these batteries (which has a pH approaching O) greatly enhances
the solubility and mobility of these metals. Moreover, the secondary
lead smelter industry has repeatedly argued that the RCRA regulations--
under either Federal or State authority--do not apply to spent
batteries. These batteries, the industry argues, are raw material; they
are not discarded, and thus not solid wastes and not subject to
regulation under RCRA. See United States v. ILCO, Inc. 996 F.2d 1126
(11th Cir. 1993). The lead components of spent lead-acid batteries
would also fall within the definition of ``scrap metal.'' The
limitations on the exemption for scrap metal are less stringent than
the limitations on the exemption for spent batteries. As the exemptions
are currently drafted, a person recycling the lead from spent lead-acid
batteries could take advantage of the less stringent limitation for
scrap metal. At a minimum, these problems need to be addressed.
E. MSW Exemption
Section 301 defines ``codisposal landfill'' and ``municipal solid
waste,'' and amends Sec. 107 of CERCLA to add new subsections (q) and
(I), both of which address liability involving municipal solid waste
(``MSW'') and municipal sewage sludge (``sludge'') at NPL sites. MSW is
defined as (A) all waste generated by households, hotels and motels,
and (B) waste generated by commercial, institutional and industrial
sources to the extent (i) such materials are ``substantially similar''
to household or public lodging waste, or (ii) the material is waste
that is collected with MSW and, regardless of when generated, is
considered conditionally exempt small quantity generator waste under
the Solid Waste Disposal Act. The term includes food and yard waste,
paper, clothing, appliances, consumer product packaging, disposable
diapers, office supplies, cosmetics, glass and metal food containers,
grade and high school lab waste, and household hazardous waste.
NAAG supports reasonable limitations on liability for disposal of
municipal solid waste. Unfortunately, the limitations provided under
Sec. 107(q) of S. 1090, as written, are confusing and appear to
contradict the exemption provided by Sec. 107(t). They will not operate
as intended, and in any event still are too broad. First, as written,
liability at any NPL site is excused in proposed Sec. 107(q) for anyone
liable as a generator or transporter if they are the ``owner, operator,
or lessee of residential property from which all of the person's
municipal waste was generated.'' Thus, as long as one's MSW comes from
residential property, one is immune for liability arising from the
generation of other hazardous wastes sent to any NPL site. Similarly,
all business and nonprofit groups having less than 100 employees are
exempt from any liability at NPL sites. There appear to be significant
drafting errors in this provision, and it contradicts the liability
provided by Sec. 107(t). Section 107(q) must be rewritten or removed
from the bill. We are concerned about Sec. 107(q)'s intent to exempt
all but large generators from liability.
Assuming that the bill's real intent is described in the
definitions and proposed Sec. 107(t), a substantial portion of PRPs
would be relieved of liability even beyond those intended to be
exempted by proposed Sec. 107(q). Under the definition of MSW, the
relief applies to not just households, but a wide, almost all-inclusive
group of business, commercial, institutional and industrial sources.
For instance, at a number of hazardous waste sites, cosmetic
manufacturers have disposed of sometimes substantial quantities of
waste containing a variety of hazardous substances, e.g. acetone. Under
S. 1090, such PRPs would escape liability because their wastes, at
least arguably, are ``substantially similar to waste materials normally
generated by households,'' i.e., cosmetics thrown away by households.
Or, for another example, at municipal-owned, codisposal facilities, it
is common to have a large volume of MSW and then a small volume of
waste from commercial and industrial sources which is highly toxic.
Many commercial, institutional and industrial facilities have used
solvents in large quantities, and those wastes were often disposed in
landfills over the years. PRPs could argue that their solvents are
``substantially similar'' to solvents used in households and,
therefore, exempt.
In proposed Sec. 107(t), S. 1090 appears to adopt EPA's current
settlement policy for municipal solid waste for generators and
transporters, as well as for municipal owners and operators. However,
the meaning of proposed subparagraph 107(t)(1)(C) is unclear. NAAG also
supports liability limitations for municipalities owning or operating
codisposal landfills. Municipalities need assistance in closing
codisposal landfill sites that have become contaminated with hazardous
substances. We are encouraged by the direction taken by S. 1090
regarding municipalities' and generators' liabilities for codisposal
sites, and would be happy to work with the committee to craft
appropriate language to address this subject.
F. Allocation Process for De minimis and Other Parties under Proposed
Sec. 122(g)(1).
Under current law, the President is empowered to perform an
allocation whenever ``practicable and in the public interest.'' Section
302 modifies current CERCLA Sec. 107(g) to require the President to
contact each PRP eligible for expedited settlement consideration and to
offer to reach a final administrative or judicial settlement with the
party, apparently with respect to any response action at any facility.
Eligible PRPs are (i) de minimis PRPs; (ii) site owners which did not
conduct or permit hazardous substance activities on the property nor
contribute to the release or threatened release by any action or
omission; and (iii) natural persons, small businesses not otherwise
exempt from liability, and municipalities which demonstrate an
inability to pay a judgment. If the President concludes that a PRP is
not eligible for settlement, the President must State the reasons for
that determination to any PRP requesting a settlement. Under the
proposal, ``[a]s soon as practicable after receipt of sufficient
information to make a determination,'' EPA then is required to
determine eligibility and to submit a written settlement offer to each.
The information relied upon by EPA must be disclosed upon request.
NAAG supports measures that promote early settlement with de
minimis parties. However, we are concerned about the mandatory aspect
of this provision and its application to every response action. The
requirement that EPA make such offers for every facility may place an
overwhelming burden on the agency, detracting significantly from its
implementation of remedies. It is our general experience that EPA is
prepared to enter into de minimis settlements when it has obtained the
necessary information. Expansion of mandatory expedited settlement
activities to all parties claiming an inability to pay at the earliest
moment seems unwise, given the uncertainties such determinations might
have on the State and Federal Governments' ability to pay for the
cleanup once such parties have been excused from liability.
G. ``Fair Share'' Allocations and the Allocation/Settlement Process
S. 1090 would establish another mandatory allocation procedure for
all parties, the ``fair share'' allocation, in an effort to reach
``fair share'' settlement at NPL sites. See proposed Sec. Sec. 122(n)-
(p). Although the heading of proposed Sec. 122(p)(2) suggest that the
provisions are limited to ``statutory orphan shares and fair share
settlements,'' which are governed by proposed Sec. Sec. 122(n) and
(o), the statutory text provides that ``[a]ll contribution and cost
recovery actions under this Act'' against generators and transporters
of MSW, municipal codisposal site owners and operators, de minimis
parties and parties unable to pay are stayed until EPA offers them a
settlement. Moreover, if the President fails to fund a statutory orphan
share or fails to ``reimburse a party as required by subsection (g),''
or ``include a statutory orphan share estimate in any settlement when
required to do so,'' the President is forbidden from issuing any
further Sec. 106 orders or to commence or maintain any new or existing
action to recover response costs at the facility. The President is
required to reimburse the parties described above for any cost incurred
in excess of the party's allocated share. We note that some of the
provisions appear to contain what we assume are drafting errors, and
the full meaning and intent of these provisions is unclear.
As written, it appears that the bill provides that EPA inaction
will stay adjudication of claims brought by States, or any other party,
if EPA has not offered to settle its own claim or even has no claim.
For instance, if EPA does not offer-a settlement to a de minimis party
that may be liable for any response costs, even at non-NPL sites, a
State's action to recover its costs under CERCLA are stayed. This is
unwise.
Moreover, if the Fund is insufficient to pay all orphan shares, the
United States cannot commence a new action or continue an existing
action to recover response costs even from parties who would not be
entitled to a settlement or reduction in liability. Nor may it issue a
Sec. 106 order, even against a party that is not entitled to a
settlement offer. See proposed Sec. Sec. 111(b)(3); 122(p)(2)(B). By
forbidding EPA from recovering costs or ordering remedial or removal
actions, these provisions not only are self-defeating, but also could
result in further endangerment of public health and the environment.
The allocation process regarding orphan shares is likely to be very
cumbersome in practice, and is unlikely to accelerate settlements or
remove smaller parties from ongoing litigation and allocation. Because
the President is required to estimate the orphan share at a site
whenever seeking judicial settlement with any party, settlements are
likely to be delayed and de minimis parties stalled in court. Moreover,
by requiring the court to review orphan share information when
evaluating a settlement, the bill is inviting the courts also to
evaluate all prior settlements when deciding whether to enter a
settlement. This will lead to needless litigation, delay, and costs.
Finally, because of conflicts between provisions requiring EPA to treat
parties claiming an inability to pay the same as de minimis parties,
and the definition and treatment of orphan shares, the allocation
process will be very complicated and will invite litigation rather than
avoid it.
Finally, other provisions make unclear whether and the extent to
which the allocation and settlement provisions will, in effect, reopen
past decrees. Because reimbursement of PRPs is expressly provided for
by S. 1090, the language at proposed Sec. 122(n)(3) stating that a fair
share allocation ``shall include'' response costs not addressed in a
settlement approved by a Federal court prior to enactment needs
clarification, as reevaluation of prior settlements is not expressly
prohibited. Reopening of prior liability determinations could well
impose huge liabilities on the Fund, making further cleanups
impossible, paralyzing EPA and the Superfund program, and shifting
costs to the States.
2. state response program amendments
A. Limits on NPL Listing
Section 202 of S. 1090 proposes a limit on the number of new NPL
listings. No more than 30 sites per year could be listed, or one site
every 2 years per State on average. We are very troubled by this
proposal.
Sites should be listed on the NPL on the basis of the risk they
pose to human health and the environment, and not be subject to an
arbitrary numerical limit. Sites should be added as long as each poses
a serious enough threat to warrant remedial action.
EPA's ability to list a site based on a neutral evaluation of the
risks it poses and need for remedial action is important to the States.
Possible listing is a major incentive for PRPs to conduct voluntary
cleanups. If the possibility of NPL listing is significantly reduced, a
major incentive for a PRP to proceed with a cleanup will be lost,
forcing the States to cleanup themselves and then seek recovery of
their costs. Many States simply cannot afford this course.
B. Revision of the NPL
Section 102(b) of S. 1090 requires EPA to revise the entire NPL in
order to change the geographical descriptions of sites and delist
portions of sites at which ``no release actually occurred,'' such as
those portions whose groundwater is contaminated presumably by
migration of contaminants from an area beyond the portion. This task
places an unnecessary burden on both EPA and the States, to which EPA
will undoubtedly have to look for assistance in performing this
reevaluation. We doubt the utility of this exercise, and oppose the
provision.
As EPA has explained, ``the NPL does not describe releases in
precise geographical terms, and that it would be neither feasible nor
consistent with the limited purpose of the NPL (as the mere
identification of releases) for it to do so.'' 55 Fed.Reg. 6154, 6156
(Feb. 21, 1990). Indeed, to accurately describe geographical boundaries
and to determine whether and where a ``release actually occurred''
requires a full remedial investigation and feasibility study (RI/FS)
and, sometimes, the implementation of the remedial design and remedial
action (RD/RA). After all, proof of where a release occurred can often
be buried underground, or sometimes just cannot be determined. As EPA
has explained on numerous occasions, delisting uncontaminated areas of
sites or even accurately defining the geographical extent of releases
``would be time-consuming, subject to constant reverification, and
wasteful of resources.'' Id.; see, e.g. EPA's most recent statement on
geographical boundaries, 64 Fed.Reg. 2942, 2943 (Jan. 19, 1999).
Finally, relisting could extinguish State and Federal natural
resource damages claims under one reading of the existing statute of
limitations. One district court has ruled that CERCLA Sec. 113(g)(1)'s
limited stay of the statute of limitations for natural resource damages
claims at NPL sites until the President selects the remedy only applies
within the geographical boundary of the site. United States v. ASDRCO
Inc., 28 F.Supp.2d 1170 (D. Idaho 1998). New Mexico, New York and other
States have filed an amicus brief urging the United States Court of
Appeals for the Ninth Circuit to reverse that erroneous reading of the
law. If upheld, S. 1090's reevaluation could retroactively eliminate
many damage claims of the States and Federal natural resource trustees
that they concluded were stayed, or force the premature filing of
litigation prior to selection of the remedy even though such suits
otherwise might be avoided or limited if the remedy selected addresses
the restoration of the sites appropriately.
Listing on the NPL does not establish, nor is it intended to
establish liability. The reevaluation which would be mandated by this
provision would need to be Allowed up repeatedly as new information
becomes available. It serves no useful purpose whatsoever.
C. Brownfields Redevelopment and State Voluntary Cleanup Programs
NAAG supports in general Sec. Sec. 101 and 201 Of S. 109()
requiring EPA to establish grant programs to assist in brownfields'
characterization and assessment and State response programs. Such
grants will assist and strengthen State voluntary cleanup programs.
NAAG also favors affording appropriate legal finality to cleanup
decisions of qualified State voluntary cleanup programs and brownfields
redevelopment programs. See Sec. 201 of S. 1090.
We suggest that the committee make clear, perhaps through the
addition of the term ``development'' to proposed Sec. 127(a)(1)(A),
that redevelopment of brownfield sites can include noncommercial uses
that are beneficial to the community. For instance, some brownfield
sites might be developed for use as community centers, parks,
libraries, and similar public facilities. Also, while the bill provides
for consultation with the Secretary of Housing and Urban Development,
it should also provide for consultation with the States.
In addition, New York believes that the redevelopment of
brownfields throughout the Nation should be encouraged and supported by
other appropriate targeted financial incentives. Perhaps the simplest
way to do this on a national level would be to add brownfields projects
to the list of ``qualified facilities'' for which tax-exempt bond
financing is available pursuant to section 142 of the Internal Revenue
Code of 1986.
For purposes of Sec. 201, Federal statutory provisions should be
flexible enough to accommodate different State voluntary cleanup laws.
States should be able to self-certify, subject to EPA's approval. After
such approval, the State should be authorized to issue a release from
Federal liability when a volunteer complies with a federally approved
State brownfields program. In this fashion State brownfields and
voluntary cleanup programs can work to their fullest potential.
3. funding
Rather than dedicating a revenue stream to funding the Hazardous
Substance Superfund, S. 1090 depends on an authorization allowing a
one-time appropriation of not more than $1 billion from the Fund, to be
used to enter into settlement agreements under the amended Sec. 122.
Monies in the Fund can be used for response actions, i. e., actions
designed to protect the public from releases, only if the total amount
of moneys in the Fund is greater than specified amounts. Appropriations
out of the General Fund are limited to a maximum of $900 million for
fiscal year 2000, and are reduced by $25 million per year for
succeeding years. Approximately $300 million in additional funds are
authorized for appropriation out of the General Fund, but may only be
used for newly specified purposes. The amount authorized is well below
current spending levels.
Like current law, S. 1090 also authorizes payment of natural
resource damages from the Fund, but adds that there first must be a
plan in place regarding restoration of the injured or destroyed
resources. However, the IRS Code's provisions that forbid use of the
Fund for such purposes, effectively overriding current Sec. 111, are
not amended. There should be conforming amendments.
Although S. 1090 imposes numerous additional costs on the Fund
through liability exemptions and reimbursement requirements, overall
funding is cut. It is likely that EPA will not have enough funds to
perform removal and remedial actions, particular given the bill's
directive to reimburse PRPs first, leaving either the public
unprotected or the States--which do not have the funds--with the
responsibility to fill the breach resulting from EPA's inability to
fund cleanups. Moreover, because there are no dedicated revenue sources
for the Fund, actual appropriations and the Superfund program will
become the subject of yearly budget battles and closed-door special
amendments during the appropriation process.
It is our Federal and State officials' responsibility to protect
the public health and the environment and to leave our children a
cleaner environment. The funding provisions are inconsistent with this
duty. Cleanups now implemented by the Federal Government and PRPs will
be left to the States, whose ability to recover the costs will have
been hobbled by other provisions of the bill. PRPs will be much less
likely to step forward to clean sites absent extensive litigation
because they will know that State governments will lack the funds and
often the statutory authority to compel cleanups. This is hardly the
legacy to leave the next generation. We strongly urge this committee to
reconsider the funding mechanism, and insure that the Superfund program
will have the funds necessary to truly complete the cleanup program
without yearly appropriation battles.
______
resolution of the national association of attorneys general
adopted summer meeting june 22-26, 1997 jackson hole, wyoming
resolution--superfund reauthorization
WHEREAS, the Attorneys General of the States have significant
responsibilities in the implementation and enforcement of the
Comprehensive Environmental Response, Compensation, and Liability Act
(CERCLA) and analogous State laws, including advising client agencies
on implementation of the cleanup and natural resource damage programs,
commencing enforcement actions when necessary to compel those
responsible for environmental contamination to take cleanup actions and
to reimburse the States for publicly funded cleanup, and advising and
defending client agencies that are potentially liable under CERCLA;
WHEREAS, the Superfund programs implemented under CERCLA and
analogous State laws are of critical importance to assure protection of
public health and the environment from uncontrolled releases of
hazardous substances at thousands of sites throughout the country;
WHEREAS, Congress is currently considering legislation to amend and
reauthorize CERCLA;
WHEREAS, to avoid unnecessary litigation and transaction costs over
the interpretation of new terms and new provisions, amendments to
CERCLA should be simple, straightforward, and concise;
WHEREAS, the National Association of Attorneys General has adopted
resolutions in March 1987, July 1993, and March 1994 on the amendment
of CERCLA;
state role
WHEREAS, many State cleanup programs have proven effective in
achieving cleanup, yet the CERCLA program fails to use State resources
effectively;
WHEREAS, State programs to encourage the cleanup and redevelopment
of underutilized ``brownfields'' are making important strides in
improving the health, environment, and economic prospects of
communities by providing streamlined cleanup and resolution of
liability issues for new owners, developers, and lenders;
federal facilities
WHEREAS, Federal agencies should be subject to the same liability
and cleanup standards as private parties, yet Federal agencies often
fail to comply with State and Federal law;
liability
WHEREAS, the core liability provisions of CERCLA, and analogous
liability laws which have been enacted by the majority of the States,
are an essential part of a successful cleanup program, by providing
incentives for early cleanup settlements, and promoting pollution
prevention, improved management of hazardous wastes, and voluntary
cleanups incident to property transfer and redevelopment;
WHEREAS, the current CERCLA liability scheme has in some instances
produced expensive litigation, excessive transaction costs, and unfair
imposition of liability;
remedy selection
WHEREAS, constructive amendments to CERCLA are appropriate to
streamline the process of selecting remedial actions and to reduce
litigation over remedy decisions;
natural resource damages
WHEREAS, constructive amendments to CERCLA are appropriate to make
it less complicated for natural resource trustees to assess damages and
to restore injured natural resources, and to reduce the amount of
litigation that may result in implementing the natural resource damage
program.
NOW, THEREFORE, BE IT RESOLVED THAT THE NATIONAL ASSOCIATION OF
ATTORNEYS GENERAL urges Congress to enact CERCLA reauthorization
legislation that:
A. State Role
1. Provides for delegation of the CERCLA program to qualified
States, and for EPA authorization of qualified State programs, with
maximum flexibility;
2. Reaffirms that CERCLA does not preempt State law;
3. Ensures that States are not assigned a burdensome proportion of
the cost of operation and maintenance of remedial actions and in no
event to exceed 10 percent;
4. Clarifies that in any legal action under CERCLA, response
actions selected by a State shall be reviewed on the administrative
record and shall be upheld unless found to be arbitrary and capricious
or otherwise not in accordance with law;
B. Federal Facilities
5. Provides for State oversight of response actions at Federal
facilities, including removal actions.
6. Provides a clear and unambiguous waiver of Federal sovereign
immunity from actions under State or Federal law;
C. Liability
7. Provides a liability system that: a) includes the core
provisions of the current CERCLA liability system that are essential to
assure the effectiveness of the cleanup program; b) provides incentives
for prompt and efficient cleanups, early cleanup settlements, pollution
prevention, and responsible waste management; c) addresses the need to
encourage more settlements, discourage excessive litigation, reduce
transaction costs, -and apply cleanup liability more fairly and
equitably, especially where small contributors and municipal waste
landfills are involved; and d) assures adequate funding for cleanup and
avoids unfunded State mandates;
8. Provides reasonable limitations on liability for disposal of
municipal solid waste;
9. Provides an exemption from liability for ``de micromis'' parties
that sent truly minuscule quantities of waste to a site;
10. Encourages early settlements with de minimis parties that sent
minimal quantities of waste to a site;
D. Remedy Selection
11. Provides for the consideration of future land use in selecting
remedial actions, provided that future land use is not the controlling
factor, and provided that remedial actions based on future land use are
conditioned on appropriate, enforceable institutional controls;
12. Retains the requirement that remedial actions attain, at a
minimum, applicable State and Federal standards;
13. Retains the prohibition on pre-enforcement review of remedy
decisions;
14. Provides that cost-effectiveness should be considered, among
other factors, in remedy selection;
15. Allows EPA or the State agency to determine whether to reopen
final records of decision for remedial actions, as under current law;
E. Natural Resource Damages
16. Clarifies that in any legal action, restoration decisions of a
natural resource trustee shall be reviewed on the administrative record
and shall be upheld unless found to be arbitrary and capricious or
otherwise in accordance with law, without precluding record review on
other issues;
17. Provides that claims for damages for injuries to natural
resources must be brought within 3 years of that completion of a damage
assessment;
18. Allows Superfund moneys to be used for assessments of damages
resulting from injures to natural resources and for efforts to restore
injured natural resources;
19. Retains the ability of trustees to recover damages based on any
reliable assessment methodology;
20. Does not revise the cap on liability for natural resource
damages so as to reduce potential damage recoveries;
21. Clarifies that trustees are entitled to recover legal,
enforcement, and oversight costs;
F. Brownfields
22. Strengthens State voluntary cleanup and brownfields
redevelopment programs by providing technical and financial assistance
to those programs, and by giving appropriate legal finality to cleanup
decisions of qualified State voluntary cleanup programs and brownfield
redevelopment programs;
G. Miscellaneous
23. Allows EPA to continue to list new sites on the National
Priorities List based upon threats to health and the environment, with
the concurrence of the State in which the site is located.
BE IT FARTHER RESOLVED that the CERCLA Work Group, in consultation
with and with approval of the Environmental Legislative Subcommittee of
the Environment Committee, and in consultation with NAAG'S officers is
authorized to develop specific positions related to the reauthorization
of CERCLA consistent with this resolution; and the Environmental
Legislative Subcommittee, or their designees, with the assistance of
the NAAG staff and the CERCLA Work Group, are further authorized to
represent NAAG's position before Congress and to Federal agencies
involved in reauthorization decisions consistent with this resolution
and to provide responses to requests from Federal agencies and
Congressional members and staff for information, technical assistance,
and comments denying from the experience of the State Attorneys General
with environmental cleanup programs in their States.
BE IT FURTHER RESOLVED that NAAG directs its Executive Director and
General Counsel to send this resolution to the appropriate
Congressional committees and subcommittees, and to the appropriate
Federal agencies.
ABSTAIN: Attorney General Don Stenberg
______
Response of Gordon Johnson to an Additional Question from Senator Max
Baucus
Question: In your opinion would S. 1090 have the effect of
reopening matters that have been addressed in consent decrees, or of
revisiting any costs that were spent in accordance with pre-enactment
administrative orders? If so, please explain how under the bill prior
agreements and expenditures would effectively be reopened, and possible
impacts.
Response. There are several ways in which matters already addressed
in consent or administrative orders are likely to be reopened under S.
1090. First, S. 1090's transition rule, at the bill's Sec. 301(b)(2),
does not apply to the limitation under proposed Sec. 107(t) regarding
``municipal solid waste and sewage sludge'' disposed of at National
Priority List (``NPL'') sites. See Sec. 301(b)(2)(A) (``the exemptions
under subsections (q), (r), and (s) of section 107 . . . shall not
apply'' to prior settlements or judgments''). Therefore, any generator
or transporter that disposed of such waste streams at NPL sites and
settled with the governments appears to be able to reopen its
settlement and argue for the settlement terms provided in Sec. 107(t).
This reopening is significant and disturbing.
The number of parties qualifying for Sec. 107(t) liability
limitation is large. The definition of ``municipal solid waste'' under
Sec. 301(a) of S. 1090 is greatly expanded to include waste from
industries and companies which is ``substantially similar'' to
household waste. As we pointed out in our written testimony, at a
number of hazardous waste sites, cosmetic manufacturers have disposed
of sometimes substantial quantities of waste containing a variety of
hazardous substances, e.g., acetone. Many commercial, institutional and
industrial facilities have used solvents in large quantities, and those
wastes were often disposed in landfills over the years. Under S. 1090,
such potentially responsible parties (``PRPs'') would substantially
limit their liability because their wastes, at least arguably, are
``substantially similar to waste materials normally generated by
households,'' i. e., cosmetics or solvents discarded by households.
Moreover, a PRP is eligible for the limitation no matter the amount of
waste disposed of by that PRP. Thus, an eligible PRP which disposed of
thousands of tons of waste containing large quantities, in total, of
hazardous substances such as those described above nonetheless would be
entitled to the limitation.
Any industrial or commercial generator in this large group of
parties that paid more than the share specified in Sec. 107(t) will
seek to reopen a prior settlement to reduce its payment consistent with
Sec. 107(t) because the transition rule--Sec. 301(b)(2)(A)--fails to
include Sec. 107(t). By this omission, a court could well conclude that
Congress intended to afford past settlers as well as future settlers
the benefit of proposed Sec. 107(t). This could result in reopenings of
consent and administrative orders at all co-disposal facilities, which
total an estimated 25 percent of all NPL sites. Only cases that have
gone to final judgment in all respects are likely to be unaffected.
Second, all of the transition rules at best protect only Federal
court approved settlements or judgments from reopening, leaving the
courts free to reopen administrative settlements or orders and any
other determinations other than Federal court approved settlements and
judgments. Proposed Sec. 122(n)(3) provides that a fair share
allocation ``shall include any response costs at a National Priorities
gist facility that are not addressed in a settlement or a judgment
approved by a United States Federal District Court [emphasis
supplied]'' before 180 days after enactment. Similarly, under the
transition rule, the exemptions at proposed Sec. 107(q)-(r) ``shall not
apply to any settlement or judgment approved by a United States Federal
District Court [emphasis supplied]'' before 180 days after enactment.
Sec. 301(b)(2)(A). Thus, administrative settlements and orders can be
redetermined and reopened under S. 1090. We note that states have
settled response cost cases in forums other than the Federal courts.
State administrative settlements may not be exempt from reopening, and
settlements or orders made in state courts might be attacked and
effectively reopened through third-party actions in Federal court.
Third, other provisions of S. 1O90 establish a series of
requirements and procedures regarding allocation that are
extraordinarily complicated and confusing. While the full import of the
statutory language is unclear, it would appear that reopening of prior
agreements is required under some provisions. For instance, S. 1O90
also requires EPA to perform a final allocation and ``identify the
total statutory orphan share owing for a facility,'' then to ``fully''
fund the orphan share and reimburse parties for expenditures above
their share. See, proposed Sec. Sec. 107(o)(4), 107(p)(2)(J)(ii). This
language could easily be construed as requiring EPA to perform an
allocation when the last operable unit is constructed for a facility
addressing all costs ever incurred and to reimburse any party that paid
too much. Similarly, the fair share, orphan share, and reimbursement
provisions apply to parties specified at proposed Sec. 122(g), which
include de minimis parties, PRPs with a ``limited ability to pay,'' and
certain small businesses. Nothing in the bill suggests that the
allocation will not take into consideration prior payments by these
parties or any other parties not specifically mentioned at
Sec. 301(b)(2)(A).
Thus, the bill could effectively reopen all orders or partial
settlements reached prior to the enactment of this bill. Whatever these
and other provisions are intended to mean, the confusion created by the
complicated procedures and potentially conflicting obligations will
lead to many years of further litigation.
We also note that the transition rule for proposed Sec. 107(u)
regarding recycling transactions provides that this new exemption
``shall not affect any concluded judicial or administrative action or
any pending judicial action initiated by the United States prior to the
date of enactment of this Act [emphasis supplied],'' effectively
eliminating their impact on pending litigation. However, that
transition rule should also provide, at a minimum, that the exemptions
of proposed Sec. 107(u) should not affect any pending judicial action
initiated by a State as well as any pending administrative proceedings
initiated by either a State or the United States. We also recommend
that the transition exclusion be modified to provide that the new
exemption does not apply to any judicial or administrative action or
proceeding in which the United States or a State has made claims for
recovery of response costs, rather than only those actions or
proceedings initiated by a government. Who initiated the action should
not determine whether the exemption applies, because state or Federal
claims sometimes are raised in cases as counterclaims, crossclaims, or
third-party claims, or when governments intervene in existing
litigation.
The effective reopening of prior agreements and expenditures in any
case in which no final judgment has been entered would create
substantial delays in the negotiation and settlement of current cases
for all parties. Prior allocations would no longer provide guidance for
future settlements, with parties likely lodging additional cross-claims
based on the new bill's provisions. Transaction costs are likely to
increase significantly, and cleanups could be delayed as performing
parties reassess their obligation to implement cleanup orders.
______
Responses of Gordon Johnson to Additional Questions From Senator
Lautenberg
Question 1. What effect, if any, would you expect S. 1090 to have
on the likelihood of PRPs entering into consent decrees for the cleanup
of NPL sites?
Response. It is unlikely that any PRP which S. 1090 identifies as
possibly eligible for an exemption from or limitation on liability will
enter into a consent decree for at least 180 days after passage of the
bill, or for a considerable period thereafter. First, the transition
rules generally provide that the new provisions do not apply to any
consent decree approved by a court 180 days after the bill's passage.
Sec. 301(b)(2)(A); proposed Sec. 122(n)(3)(B). No party that might take
advantage of the change in law would act before then. Second, even
after this initial 6 months, many PRPs would decline to enter into
consent orders until EPA performed the allocation or offered
settlements, particularly those entitled by a statutory stay proposed
under Sec. 122(p). Any PRP arguably entitled to an exemption or
limitation on liability would seek it rather than enter into any
meaningful consent order. The substantial, and ambiguous changes in the
exemption and limitation provisions of the statute will limit the
number of consent orders reached after passage of the bill until the
courts construe the new provisions. That process will take years, as
our experience has demonstrated.
Question 2. What are the relative advantages and disadvantages of
PRP lead cleanups being conducted under consent decrees versus
administrative orders?
Response. A remedial action under CERCLA may be conducted by the
responsible party under either a consent decree or a unilateral
administrative order (see CERCLA Sec. 122(d)(1)(A)). A consent decree
is a settlement agreement negotiated by the parties, usually submitted
for public comment, and approved by the court as an order of the court.
A unilateral administrative order is, as its name implies, an order
issued unilaterally by the agency, without negotiation and without the
imprimatur of a court. For several reasons, a negotiated consent decree
is preferable to a unilateral order as a vehicle for cleanup.
First, because a consent decree is a negotiated agreement, all
parties, including the responsible parties conducting the cleanup,
understand and agreed to its terms. There is less likely to be a
dispute over the meaning of those terms. Moreover, the responsible
parties are much more likely to comply with a consent decree. whose
terms they have agreed to, and to do so promptly, than they are to a
unilateral order whose terms have been imposed upon them by the agency.
Second, a consent decree is much more easily enforced. A consent
decree almost always includes stipulated penalties, see CERCLA Sec. 121
(e)(2), that is, a schedule of civil penalties that the settling
responsible parties agree in advance to pay should any violation occur.
Moreover, because a consent decree is a court order, it is very easy to
seek assistance from the court, e.g. a further court order or
sanctions, to ensure its timely implementation. On the other hand,
because a unilateral order is not negotiated, there can be no
stipulated penalties. To enforce the order, even for relatively minor
infractions, EPA must refer the matter to the Department of Justice and
a new lawsuit must be initiated.
Third, the parties can agree to more expansive terms in a consent
decree. For example, EPA routinely includes a settlement for past
response costs--those incurred by the Federal Government and often
those incurred by the state government--as part of a cleanup
settlement. However, EPA has no authority to require payment of
response costs under a unilateral administrative order. A separate
lawsuit or lawsuits must be filed.
Fourth, under section 113(f)(2) of CERCLA, the responsible parties
that resolve their liability in a settlement are entitled to
contribution protection from actions by other responsible parties. No
such protection is afforded to the responsible parties under a
unilateral order. More litigation, in the form of third-party
contribution actions, is likely to result.
Finally, EPA generally issues unilateral administrative orders only
if agreement on a negotiated consent decree cannot be reached. Thus,
entry of a consent decree usually results in a faster cleanup.
Question 3. What would be the impact of S. 1090 on litigation and
transaction costs, for state and Federal Governments, PRPs who are
exempt or whose liability is capped, and for non-exempt PRPs?
Response. As a preliminary matter, it can be noted that the current
statute is producing intended results. For instance, EPA reports that
70 percent of all remedial actions at Federal Superfund sites were
being performed by responsible parties. The experience in most states
is similar: about 70 percent of sites are being remediated under state
consent orders. A major reason for this success is that the liability
under CERCLA has been clear and unequivocal.
It has taken 20 years since CERCLA, and over a dozen years since
SARA, for the courts to construe the law. Instead of spending money
litigating whether, and how much, they will pay at Superfund sites, the
responsible parties are spending considerably less just calculating
their share, through settlements and allocations. Similarly, the
Federal and state governments have been able to conserve their
resources and limit transaction costs.
Unfortunately, S. 1090 proposes that we start all over with whole
new categories of exemptions and limitations. All parties' transaction
costs likely will shoot up to what they were in the first 10 years of
CERCLA litigation. EPA's costs will rise also because of its mandated
obligation to perform allocations in every case and make settlement
offers to specified classes of parties, as well as promulgate
additional regulations implementing S. 1O90's other provisions. PRPs
who are exempt or whose liability is capped will also face additional
transaction costs initially as the scope of the exemptions and any caps
is determined.
__________
Statement of Wilma Subra, Subra Co., New Iberia, Louisiana
Thank you for the opportunity to testify on the issues of the
Superfund Program. I have been involved in Superfund issues since the
inception of Superfund, working with citizen groups living around
sites, serving as a technical advisor on the National Commission on
Superfund, providing technical assistance to citizens groups at 8 NPL
sites through the Technical Assistance Grants process, and assisting
citizens groups deal with voluntary cleanup efforts.
The Superfund Program Completion Act of 1999 would limit and weaken
the Superfund program and result in continued environmental damage and
human health impacts from sites that would not be allowed to be
addressed by the program The bill limits the number of new NPL sites,
reduces the level of funding for the program, encourages State programs
to assume program responsibilities in States that lack the financial
and technical resources as well as the political ability to carry out
the programs, limits and in some cases eliminates public participation,
discourages voluntary cleanups by PRP's at sites prior to being listed
on the NPL, and places at risk communities that live on or near fund
led sites where the remedies were only containment.
Containment Remedies at Fund Sites
A containment remedy is currently being implemented by EPA at the
Agriculture Street Landfill Superfund Site in New Orleans. The remedy
is being paid for with fund money. The landfill is a 95 acre site
operated by the City of New Orleans from 1909 to 1965. The City then
developed 47 acres of the landfill as private and public housing,
recreational facilities and an elementary school. The residential
housing on top of the landfill consists of 67 privately owned homes,
179 rent-to-own town homes, and 128 senior citizen apartments. The
containment remedy consists of removal and replacement of two feet of
soil and waste in 10 percent of the residential area. Only the exposed
soil/waste areas will be addressed. The waste will be allowed to remain
under streets and structures and will be located a mere two feet below
peoples' yards. When this remedy fails, and it will fail due to
subsidence, very shallow ground water, and the area being located below
sea level, resources from the fund would not be available, under the
proposed bill, to finance the measures necessary to fix the containment
remedy. This is just one example of the many sites where containment
was utilized at fund led sites where the citizens will lose when the
containment remedy fails and fund resources are not available to repair
the failed remedy.
Governor Request Required
Section 202.(b)(3) of the bill requires a written request from the
Governor of a State in order to add a site to the National Priorities
List. The requirement will severely limit the sites proposed for the
NPL. Governors will be reluctant to request that the EPA add sites to
the NPL when the potentially responsible parties at the sites are his
financial campaign contributors. The only sites a Governor may consider
requesting be added to the NPL are sites that are 100 percent orphan.
In States that lack the financial resources or political will, such
orphan sites already fall to EPA to fund the cleanup on a regular
basis.
The requirement that a Governor request a site be added to the NPL
completely eliminates the ability of citizens to petition to have sites
listed. In the State of Louisiana, the majority of the NPL sites were
listed as a result of citizens involvement. The elimination of the
citizen petition process is not appropriate. Allowing the State
Governors to have the ultimate authority over the listing of sites
prolongs the exposure of citizens living and working on or near the
sites and citizens consuming aquatic and terrestrial organisms
contaminated by sites.
Limit on Number of New Sites
Section 202 (b)(2) limits the number of new sites that could be
added to the NPL on an annual basis. The limit is set at 30 per year.
That is less than one site per State per year. Such a limit is not
sufficient to address the number of sites needing to be addressed under
the Superfund program.
For States that lack adequate financial resources to address sites
that lack responsible parties, the limit on the number of new sites
will be a burden that they will not be able to address. The burden will
continue to be borne by the citizens living on and adjacent to these
hazardous waste sites.
CERCLIS Sites
The EPA will be required to investigate all sites currently on the
CERCLIS list within 2 years. If the EPA does not investigate all of the
sites and either list, prepare for listing or remove the sites from the
CERCLIS list within 2 years, those sites become problems of the State.
It is doubtful that the EPA has the financial and technical resources
to investigate the more than 10,000 sites on the CERCLIS list. The
States definitely do not have the financial and technical resources
necessary to address the CERCLIS sites.
The State of Louisiana currently does not have the resources to
evaluate the more than 500 potential sites or to perform remedial
activities at confirmed hazardous waste sites. More than 50 sites where
hazardous waste needs to be cleaned up are waiting for State financial
resources to become available. When sites pose an eminent and
substantial threat, the EPA has to step in to finance and perform
emergency removal actions for the State. The State of Louisiana and
many others cannot address the current site load much less handle the
Federal CERCLIS sites destined to be dumped on them under the terms of
this bill.
State Response Programs
Section 128 (b) sets forth the elements necessary for a State
program. The elements listed lack minimum standards for a State program
and a mechanism by which EPA is required to evaluate and approve a
State program.
The requirements lack a mechanism to insure that a State will be
able to maintain sufficient financial and personnel resources to
perform the response program. Financial resources can quickly be
eliminated by State legislative bodies. A major industrial facility can
hire an agencies core and experienced technical people. The State
program would then lack the necessary organizational and technical
expertise to administer the response program.
The bill specifies adequate opportunity for public participation in
a State program. States could basically isolate the public and the
impacted community from participating in the State response program.
The bill fails to provide a mechanism for addressing CERCLIS sites
in States that do not qualify for the response program. The EPA will
not have the authority or financial resources to address the sites in
States that cannot qualify for response programs. When sites are not
addressed properly in a State, the citizens in the area of the sites
continue to be impacted as a result of chemicals associated with the
sites.
The bill further endangers public health and the environment by
prohibiting the Federal agency from stepping in when there is a release
at a State site. When the State fails to take appropriate actions the
EPA must have the authority to act. The citizens must be assured that
the Federal agency will have the ability to act when their State agency
does not or will not act.
__________
Statement of Bernard J. Reilly, Corporate Counsel, DuPont, on behalf of
the Chemical Manufacturers Association
i. introduction
Good afternoon Chairman Chafee, Chairman Smith and members of the
committee. My name is Bernard Reilly. I am Corporate Counsel for DuPont
Company and am here representing the Chemical Manufacturers Association
(or CMA). CMA is a non-profit, non-partisan trade association whose
member companies produce more than 90 percent of the basic industrial
chemicals manufactured in the United States. CMA and DuPont also are
members of the Superfund Action Alliance (SAA), a combined group of
businesses, trade associations and other concerned organizations that
has been actively engaged in the Superfund debate for a number of
years.
CMA has worked on Superfund reform since the early 1990's with
Members of Congress, the Administration, environmental groups, States,
cities, and other business organizations. In addition, we have worked
with EPA to improve the Superfund program through administrative
reforms.
I would like to commend Chairmen Chafee and Smith for their
leadership over the years in trying to reform the Superfund law and for
their introduction of S. 1090, the Superfund Program Completion Act.
CMA recognizes the Senators' accomplishment in producing this bill. As
long time participants in the efforts to reform Superfund, CMA
understands that this is not an easy task and looks forward to working
with both the Republican and Democratic members of the committee and
the Senate on this bill.
CMA has completed a preliminary review of the recently introduced
bill. I would like to spend the next few minutes highlighting what is
especially noteworthy, touching on a number of strong areas, and
following with some areas that could be improved.
ii. noteworthy areas of s. 1090
Clearly, the most important issue facing Congress at this point is
the future direction of the program. As we have previously noted, after
17 years of existence, there is more of Superfund behind us than ahead
of us. According to EPA, nearly 90 percent of all non-Federal sites on
the National Priority List (NPL) are undergoing cleanup, 60 percent
will be finished by the end of this Congress and 85 percent will be
cleaned up by 2005. Congress needs to determine what remains to be done
under Superfund, how long it will take, and how much it will cost. We
strongly commend the cosponsors of S. 1090 for recognizing these
critical issues and taking appropriate steps to address them.
CMA has prepared estimates of the funding required to complete the
job at hand. These indicate that Superfund funding could be
dramatically reduced and there would still be sufficient funds to pay
for both remaining sites and sites that GAO and EPA have concluded will
be added to the NPL in the future. Program spending levels should be
adjusted accordingly to fit the future needs of the program in order to
ensure that more funds than necessary are not appropriated. S. 1090
does exactly that. Congress should take the next step and direct an
independent study of funding needs.
In addition to recognizing that Superfund is moving toward
completing the job of cleaning up existing sites, and that the funding
levels need to be adjusted accordingly, S. 1090 contains other
important provisions. These include: finality for State cleanups; an
integral Governor's role in the process of listing sites on the
NPL;liability relief to ensure that brownfields sites are redeveloped;
and a recognition of the States' primary role in cleanup.
iii. areas of s. 1090 that could be improved
Another aspect of this bill deserves credit at the same time that
it raises some concerns about its implementation. This particular
aspect has to do with the exemptions that are provided for certain
parties and the allocation system that is set up to pay for those
parties' shares. The bill deserves credit for recognizing that it would
be wholly unfair to pass exempt parties' shares to the remaining
parties at a site. The allocation system that is set up to determine
those shares, however, appears to be flawed. Under this system,
industrial parties at these sites not only will continue to pay more
than their fair share of liability, they probably also will pay for
shares attributable to exempt parties.
As we all know only too well, it is not easy to develop fair,
defensible, and acceptable liability allocations. CMA has advocated a
streamlined system for several years, calling for the inclusion of
certain basic elements but not overburdening the system with detail.
The single most important element of any streamlined process is that it
be administered by third-party neutrals who do not have a vested stake
in the outcome. S. 1090 does not include this element. Instead, the
bill designates EPA as the allocator. This is not appropriate given
EPA's demonstrated, vested interest in preserving the Trust Fund and
culture of assigning liability to ``deep pockets.'' The bill also lacks
a defined process for information gathering and deadlines for assuring
that allocations are completed in a timely manner.
Fundamental reform to ensure the successful, cost-effective future
of the Superfund program requires changes to areas including natural
resource damages, remedy selection, and cost recovery programs.
Improvements in the NRD program would help to ensure that the program
focuses on the restoration of injured or lost resources, not surplus
damages. Improvements in Superfund's remedy selection provisions,
recognizing what is happening in the field and focusing on risk-based
remedy selection, would help to ensure that cleanups are as fast,
efficient, and cost-effective as reasonably possible. Finally,
improvements in the Superfund cost recovery provisions would ensure
that EPA is not allowed to recover costs that are ``not unreasonable''
and ``not unnecessary.''
iv. conclusion
Chairman Chafee and Chairman Smith and members of the committee,
thank you for undertaking the hard work necessary to produce the
Superfund Program Completion Act. As I have said, the future direction
of the program is the most critical issue facing us in reforming
Superfund. We see that future as one in which sites currently listed on
the NPL are cleaned up, and the remaining sites are addressed under a
reduced program with reduced spending levels. We strongly commend you
for taking an innovative look at these issues and addressing them in S.
1090.
We appreciate the opportunity to provide input into this
challenging process. At this point, I would be happy to answer any
questions you may have.
__________
Statement of Karen Florini, Environmental Defense Fund
Introduction
On behalf of the Environmental Defense Fund (EDF), I appreciate
this opportunity to present our views on S. 1090, the ``Superfund
Program Completion Act of 1999.'' EDF has been actively involved in the
Superfund reauthorization process, serving on EPA's NACEPT Committee on
Superfund and on the National Commission on Superfund, and testifying
repeatedly on Superfund during the last several Congresses.
We recognize that this bill differs significantly from earlier
Superfund reauthorization bills introduced in this committee. Unlike
its predecessors, S.1090 does not contain radical changes to current
provisions on cleanup standards and natural resource damages--changes
that we believe would have greatly weakened cleanups, gutted the
polluter-pays liability system, and profoundly hampered recovery for
natural resource damages.
Nonetheless, S.1090 contains numerous objectionable provisions,
compelling us to oppose it strongly. Key problems include:
--sharp reductions in cleanup resources authorized, even as EPA's
workload is expanded by the allocation process and other provisions;
--dramatic slowdowns in the pace and quality of cleanups that are
likely to result from the superficially innocuous fair-share allocation
provisions;
--the preferential status of funds for liability relief compared to
cleanup;
--the numerous holes in the Federal safety net for cleanups,
including the unwarranted cap on the number of sites, the requirement
that sites can be listed only upon a Governor's request, and
restrictions on Federal authority at State-cleanups sites even where
problems remain; and
--over-breadth of some of the liability limitations.
Before detailing the problems with the bill, I must address the
related issue of Superfund's polluter-pays taxes. It is our
understanding that the sponsors of this bill do not intend to introduce
companion legislation to re-impose the taxes in conjunction with this
bill, and indeed will oppose re-imposition of the taxes absent radical
revisions to Superfund.
In our view, this bill must be accompanied by companion legislation
that re-institutes Superfund's polluter-pays taxes. In simple terms,
it's time for the $4-million-plus daily tax holiday for industry to
end. Since the taxes lapsed at the end of 1995, industry has benefited
to the tune of more than $5 billion in avoided taxation. \1\
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\1\ This estimate is on the low side, as economic expansion in the
years since 1995 would have produced tax revenues higher than the
approximately $1.5 billion collected in 1995.
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Superfund embodies the polluter-pays principle--which is
overwhelmingly supported by the American public--in two distinct ways:
in its liability provisions, under which responsible parties must
conduct cleanups themselves or pay for EPA's cleanup activities, and in
its tax provisions. The taxes cover what the liability system does not:
sites at which responsible parties cannot be identified or lack the
resources needed for cleanups, and certain broader programmatic
activities.
But under S.1090, funds for cleanup operations would be
appropriated from general revenues, not from the polluter-pays taxes
[SPCA Sec. 401 (a), amending CERCLA Sec. 111 (p.89)]. \2\ We oppose
this fundamental shift in the nation's dumpsite-cleanup strategy for
both on principle and for pragmatic reasons. As a matter of principle,
these taxes should be paid by groups with a closer relationship to the
problem, namely industry, rather than individuals with a less-direct
relationship, namely the general public. This is rough justice, to be
sure, but rough justice is better than none.
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\2\ In addition, to the extent that cost-recovery actions produce
amounts in the Trust Fund in excess of specified levels, those funds
can be used for cleanups, but without any concomitant increase the
annual authorizations [SPCA Sec. 401 (a), amending CERCLA Sec. 111 (h),
p.98].
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From a pragmatic perspective, the existence of a dedicated stream
of funds increases the odds that appropriators will spend those funds
(at least most of them) for their intended purpose. It is true that,
historically, appropriations have not kept pace with the level of tax
revenues generated--but those accumulated funds have been financing the
program for the last 4 years since expiration of the tax, thus
fulfilling the original purpose of their collection.
Additional concerns with the bill are set forth below. \3\
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\3\ All references to the bill are to the version introduced on May
20, 1999, headed TOM99.310, as downloaded from www.senate.gov/epw/ on
May 21, 1999.
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I. Money Matters: Declining Authorizations Will Retard Cleanups
Far from assuring that additional resources will be available so
that EPA can accelerate or even maintain the rate of cleanup
completions while meeting the new demands imposed by S. 1090, \4\ the
bill does precisely the opposite: it sharply ratchets down
authorizations, beginning with fiscal year 2000 [SPCA Sec. 401 (a),
amending CERCLA Sec. 111(h), p.98]. The exact degree of reduction is
difficult to ascertain, because the bill creates new categories for
various kinds of expenditures. Nonetheless, it is clear that the amount
of funding authorized for fiscal year 2000 is substantially below that
actually appropriated for fiscal year 1999. In addition, authorizations
decline by another $100 million by 2004 (and inflation will reduce the
real-dollar values even further).
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\4\ These include conducting allocations at hundreds of sites [SPCA
Sec. 303(a), adding CERCLA Sec. 122(n), p.76]; revising the National
Priorities List to address the ``parcelization'' problem for contiguous
properties [SPCA Sec. 102(b), adding CERCLA Sec. 105(h), p. 181; and
reviewing the CERCLIS data base of potentially contaminated sites
within 2 years to determine which sites should be listed as NPL sites
[SPCA Sec. 202, amending CERCLA Sec. 105(b)(1), p.381.
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Ratcheting down authorizations at this point in the Superfund
program is insupportable. There is no basis for believing that EPA will
need less money to conduct cleanups in the next five fiscal years than
it does in this one. While construction is complete for about 600
Superfund sites, \5\ there are another 700 sites still to be completed.
\6\ It is my understanding from informal discussions with EPA staff
that the agency expects to continue construction-completions at the
same pace for the next 5 years, namely about 85 per year--unless, of
course, funds are curtailed.
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\5\ There had been 599 construction completions as of 4123199. See
http://www.epa.gov/superfund/sites/npl/nplfin.htm (as of 5/21/99).
\6\ As of May 18, 1999, there were 1211 sites on the National
Priorities List of Superfund Sites, with several dozen additional
proposed sites. See http://www.epa.gov/superfund/sites/npl/nplfin.htm
(as of 5/21/99).
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For years, critics of the Superfund program have bemoaned the slow
pace of cleanups. Now that progress is faster, \7\ the sponsors of this
bill propose to curtail sharply the availability of the resources
needed to sustain that progress. As a result, communities that have
long awaited completion of nearby Superfund cleanups will have to wait
longer still.
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\7\ The faster rate of progress is a silver lining with some
serious clouds on the horizon. Anecdotal reports suggest that EPA's
eagerness to achieve a faster rate of construction completions has
prompted the agency to rely heavily--unduly so--on containment-based
rather than treatment-based remedies. Indeed, it is our understanding
that only about 30 percent of current remedies involve treatment. While
treatment options are not always available, they are strongly
preferable where they are feasible, since containment remedies threaten
health and the environment if monitoring and maintenance is allowed to
lapse. Moreover, containment remedies inevitably hamper communities'
flexibility to change land use over time as community needs change,
since the containment restrictions must continue to be observed.
---------------------------------------------------------------------------
This makes no sense.
Moreover, while it is true that there are fewer sites in
Superfund's pipeline overall for future cleanup than was recently the
case, the bill simply ignores the fact that--correspondingly--there are
more sites now in the operation and maintenance phase. A recent article
by Dr. Joel Hirshhorn (copy appended) points out that EPA to date has
done a miserable job in conducting the statutorily required 5-year
reviews of sites at which some contaminants are left in place. \8\ Only
by this kind of active oversight can we possibly hope to know if
remedies are working, and to have advance warning where they aren't.
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\8\ Hirshhorn, ``EPA's Five-Year Review of Superfund Sites Needs
Higher Priority,'' Environment Reporter, Vol. 29, No. 42 (Feb. 26,
1999). Dr. Hirshhorn has had extensive hands-on experience with the
Superfund program through many years of service as a Technical Adviser
to communities and was previously with the Office of Technology
Assessment.
---------------------------------------------------------------------------
In other words, even if EPA were to need fewer resources for
construction-completions over the next 5 years--an assumption that is
by no means warranted--the agency will clearly need more resources to
conduct 5-year reviews, and to take followup action where needed.
It is no secret that the authors of this bill view cleanup of
highly contaminated hazardous waste dumps as a State responsibility,
not a Federal one, and are moving to dump cleanups back on the States--
regardless of whether all States have, and will continue to have, the
resources and inclination to clean up highly contaminated sites. In our
view, this approach elevates theoretical federalism over protection of
health and the environment, and we oppose it strongly. Dumping
Superfund responsibilities on States that may currently or in the
future lack the resources or aptitude to provide effective cleanups is
as unconscionable as dumping wastes into the environment in the first
place.
Moreover, down-sloping authorizations are unnecessary.
Authorizations provide a ceiling, not a floor. If it turns out during
the next 5 years that fewer funds are needed than were authorized, the
Appropriations Committee will be able to make mid-course corrections.
As programs seldom receive the full amount of appropriations that are
authorized, this is hardly a-revolutionary concept.
II. Money Matters, Part 2: Preferential Treatment for Liability Relief
over Cleanups
To add insult to injury, S.1090 provides that funds for liability
relief get preferential treatment and that inability to finance
liability relief at a site limits EPA's ability to order additional
cleanup at that site [SPCA Sec. 303(a), adding CERCLA
Sec. 122(o)(4)(B), p.80 and (p)(2)(B), p.82]. Specifically, liability-
relief funds tap the remaining balance in the Trust Fund from the
accumulated reserves of the now-expired taxes, while funds for cleanups
come from general revenues [SPCA Sec. 401 (a), amending CERCLA
Sec. 111(a) p.90 and Sec. 111 (h), p.98].
Moreover, while EPA is obliged to spend funds reimbursing polluters
for all costs attributable to a party whose liability is limited [SPCA
Sec. 303(a), adding CERCLA Sec. 122(p)(2)(J)(ii), p.88], there is no
corresponding obligation to spend one thin dime on actual cleanups. And
because there is no ``fireball'' between funds for paybacks and funds
for cleanups, all of the moneys in the Superfund could be exhausted on
liability-relief funds, leaving none for actual cleanups, oversight,
and enforcement by EPA, as well as vitiating programs for Technical
Assistance Grants.
Finally, S.1090 contains extremely confusing language that could
readily be interpreted to require EPA to reimburse polluters for work
they have already agreed to do--an unwarranted windfall. Specifically,
the bill provides that a ``judicially approved consent decree or
settlement shall identify the total statutory orphan share owing for a
facility'' if the decree or settlement covers the last stages of the
cleanup [SPCA Sec. 303(a), adding CERCLA Sec. 122(o)(4), p. 80 (italics
added)].
During discussions with majority staff, we were told that it is not
the sponsors' intent to re-open any existing settlements. We concur
that this bill should let ``bygones be bygones'' for both fiscal and
practical reasons, as generally occurs in new legislation. However, we
are far from convinced that the language now in the bill achieves that
objective. To the contrary, the use of the words ``total'' and
``facility'' suggest that before the final settlement, EPA must go
back, determine how much the statutory orphan share would have been for
all the other stages of the cleanup, and deduct that from the amounts
owed by the polluters in the final settlement. This approach would be a
logistical nightmare, as well as a huge drain on program resources. It
is imperative that this language be clarified to avoid such an outcome.
III. A Cure Worse than the Disease: How the Allocation System Will
Degrade the Quality and Pace of Cleanups
Although a fair-share allocation system sounds innocuous, the
approach taken in S. 1090 is likely to result in a dramatic curtailment
in the pace of cleanup progress--and in the quality of cleanups as
well. This somewhat counter-intuitive result will occur for the
following reasons.
Most overtly, the bill expressly bars issuance of cleanup orders
where EPA cannot pay the orphan share when required to do so [SPCA
Sec. 303, adding CERCLA Sec. 122(p)(2)(B), p.82]. In other words, if
liability-relief funds run short, cleanups can't be completed. This
approach is simply unacceptable. There is nothing ``fair share'' about
a system that holds completion of cleanups hostage to the availability
of liability-relief funds--it just punishes communities that have
waited completion of cleanups for far too long already.
Moreover, by replacing joint and several liability with a ``fair
share'' system, and simultaneously cutting the authorization, the bill
leaves the agency with a Hobson's choice among three unappealing
alternatives: (i) EPA can pay for cleanups itself--until it runs out of
funding for that year; (ii) EPA can enter into consent decrees for
cleanups--giving polluters leverage to insist on cheaper, containment-
based remedies rather than treatment-based remedies that offer superior
long-term protection but have a higher initial price-tag, or (iii) EPA
can issue unilateral administrative orders to polluters that require
them to carry out a cleanup--but the prior experience suggests that
unwilling parties do a poor job, require extensive oversight, and drag
their heels. None of these approaches achieves environmentally sound
outcomes.
In addition, S.1090 could substantially delay cleanups for which no
final settlement has yet been adopted. Under the bill, a party's
statutory orphan share must be estimated before a settlement can be
adopted [SPCA Sec. 303(a), adding CERCLA Sec. 122(p)(2)(K), p.89]. It
is not at all clear how these estimates are to relate to the
allocations required under section 122(n) (as added by SPCA
Sec. 303(a), p.76). If the estimate must be based on the allocation,
substantial delays will arise. This is because the allocation itself
will take quite a while, particularly for sites with a large number of
parties. Each party will have to be contacted (including any de minimis
parties or others who have long since received settlements), and
directed to gather and submit their records (which is certain to raise
the ire of parties who have already entered into settlements). That
information will have to be evaluated and the allocation prepared.
Moreover, polluters will have an incentive to identify as many
additional potential parties as feasible, in the hopes of lowering
their own allocated share, despite the added workload for those parties
in gathering their records.
If it is not intended that the estimate be based on a 122(n)
allocation, that should be made clear in the text. (While this would
alleviate some of the pace concerns, it by no means obviates them, as
EPA-will still have to conduct a large number of complex allocations--
diverting its limited resources from cleanups.)
None of these evils are necessary ones. If Congress wants to assure
that EPA will help cover the costs of entities who can't or shouldn't
be sued--as the agency has been doing with considerable success for the
last few years--it can designate a pot of funds for that exclusive
purpose. \9\ At this juncture, a statutory allocation system is a
solution in search of a problem, and one that will create innumerable
problems in itself.
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\9\ However, such funds should not have priority over cleanup
funds, nor compete directly with them.
---------------------------------------------------------------------------
ii. cutting holes in the federal safety net
A. Limits on Superband Authorities at State Cleanup Sites
The public needs and deserves an effective Federal fallback, or
safety net, where States fail to carry out their environmental
responsibilities appropriately for toxic site cleanups, just as occurs
for air and water pollution programs. Yet, with certain exceptions,
S.1090 bars EPA from ordering cleanups, and from recovering cleanup
costs, for releases that are ``within the scope of a response action
that is being conducted or has been completed under State law'' [SPCA
Sec. 201 (b), adding CERCLA Sec. 1 28(c)]
Remarkably, there are no criteria at all for these prohibitions.
They apply--regardless of whether there has been any public
participation whatsoever in -development of that State response action,
--regardless of whether that action will be protective,
--regardless of whether citizens have judicial review for
unprotective cleanups,
--regardless of whether the State response plan is actually being
complied with, and even regardless of whether the State has the legal
or practical capacity to enforce the action.
Once a State response action exists, EPA is barred from ordering a
cleanup or recovering cleanup costs, even where a site presents an
imminent and substantial endangerment to health or the environment
(save by using the Fund's increasingly limited resources, without cost-
recovery).
Moreover, there are no substantive standards whatsoever for State
cleanups. Unless a State opts to establish regulations, each site's
plan will be issued an ad hoc basis with no baseline standards to
assure the safety or adequacy of cleanups, meaningful public
participation, judicial review, or any other safeguard. Tens or
hundreds of thousands of sites may be dealt with on an ad-hoc basis,
making effective public oversight completely impossible--even apart
from the fact that the bill makes no provisions for community technical
assistance. And meanwhile, use of Superfund's authorities at these
sites are limited.
We recognize that the bill provides certain exemptions that allow
EPA to issue cleanup orders and recover costs. These include a request
from the State, or EPA's finding of interstate pollution. In addition,
EPA may act upon determining that the State isn't taking appropriate
action and the situation presents ``a public health or environmental
emergency'' for an ongoing cleanup. For already-completed responses,
the standard is ``substantial risk'' as evidenced by new information,
fraud, or failure of the remedy where there is a clear threat of
exposure [SPCA Sec. 201 (b), adding CERCLA Sec. 1 28(c)(3)(B).] In
other words, EPA cannot come in, even where the remedy isn't working,
unless the agency can show a clear threat of exposure.
This approach is the antithesis of prevention. It creates different
legal standards, and provides ammunition for polluters to argue that
they should be exempt from cleanup or payment obligations based on
supposed lack of clear exposure, or on the ground that the State wasn't
really unwilling to act, or that there wasn't an ``emergency.''
We strongly oppose these limits on Superfund authority. While
carefully crafted liability relief for prospective purchasers may well
be desirable (assuming community participation rights are assured),
limiting Superfund authorities for a large but amorphous range of sites
is indefensible. Such limitations are also unnecessary: the private
market is increasingly providing mechanisms for moving forward
brownfield redevelopment today, with Superfund in place. \10\
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\10\ Conferences with titles such as Getting Contaminated Property
Deals Done,'' proclaiming that ``we will excite you with brownfield and
financial success stories'' are increasingly common. [Flier for RTM
Communications conference, April 6-7 1999, Washington, DC]
---------------------------------------------------------------------------
B. Silent Vetoes through Gubernatorial Inertia
In another highly objectionable feature of the bill, new sites can
be added to the Superfund list only upon the written request of the
Governor of the State in which the sites is located [SPCA Sec. 202,
adding CERCLA Sec. 105(b)(3), p.38]. (S.1090 is even more extreme than
its predecessor bills, which required concurrence rather than an
affirmative request.)
While it may be appropriate to give States ``first dibs'' on
cleanups at sites that will be appropriately addressed through State
action, this provision goes much too far. A State could, through simple
inaction, bar action under Superfund even though the site will not
otherwise be cleaned up. The State need not even give any reasons for
failing to submit a request, inviting potential abuses (if, for
example, a major potentially responsible party at the site also
happened to be a campaign contributor to a high-ranking State
official). EPA should defer to a State only upon affirmatively
determining that the State will conduct an adequate, timely cleanup
absent the listing or 106 order.
C. The NPL Cap: Dumping Cleanups on Communities and States
Yet another serious problem is the bill's inclusion of an arbitrary
cap on the number of additional sites that can be added to the National
Priorities List. Under S.1090, EPA cannot add more than 30 sites
annually until 2004 [SPCA Sec. 202, adding CERCLA Sec. 105(b)(2),
p.37]. A cap has profound consequences because, unless a site is
listed, EPA cannot undertake cleanup activities (other than a short-
term, low-cost emergency removal). In effect, this provision dumps the
problem of Superfund site cleanups into the laps of the States--
regardless of whether they have the resources or capacity to conduct
those cleanups.
Late last year, the General Accounting Office reported that more
than half of the 44 State officials interviewed said that their ability
to fund cleanups is poor or very poor. \11\ The same report concluded
that, for about 1,800 sites potentially eligible for Superfund listing,
it was unclear how more than half would be handled, while States and
EPA said that about 13 percent may be listed on Superfund--but with
little overlap as to which ones.
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\11\ U.S. General Accounting Office, Unaddressed Risks at Many
Potential Superfund Sites. GAO/RCED-99-8, . November 1998.
---------------------------------------------------------------------------
Earlier, the GAO had reported that a cap could force States to
accept responsibility for 1,400 to 2,300 sites (1,100 already
identified by EPA, along with an estimated 300-1,200 yet-undiscovered
sites). \12\ The estimated cleanup costs range from $8.4 to $19.9
billion.
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\12\ U.S. General Accounting Office, Impact on States of Capping
Superfund Sites. GAO/ACED-106R. March 1996. As the 1998 report does not
refer to the 1996 report, it is not entirely clear how GAO would view
the relationship between these two sets of findings.
---------------------------------------------------------------------------
The GAO report makes painfully clear that the States are in no
position to take on this added burden. Indeed, States are having
difficulty securing resources for their current cleanup efforts. Of the
States surveyed by GAO,
``three of the seven States with active programs said that taking
on these additional cleanups would exacerbate an already difficult
financial situation. Two other States said that they expect to face
funding shortfalls beginning in fiscal year 1997 that will make it
difficult to absorb the additional cleanup responsibilities, at least
for a few years subsequent to that time. Another two States said that
while they had sufficient funds to manage their own inventories,
funding the additional cleanups would be difficult.'' \13\
---------------------------------------------------------------------------
\13\ Ibid., p.2.
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Thus, there is no basis for capping the number of sites that EPA
may add to the National Priorities list.
This provision also undercuts two of the valuable incentives
created by Superfund: that which prompts voluntary cleanup of non-NPL
sites in order to avoid a potential future NPL listing, and that which
prompts careful management of wastes generated now.
GAO noted that State program managers ``pointed out that a major
incentive for private parties to clean up sites is to avoid having
their properties added to the list of the most contaminated sites in
the country.'' \14\ In short, a cap on the number of Superfund sites
may have the perverse effect of creating a greater need for more
Superfund listings, by reducing incentives for non-Superfund voluntary
cleanups.
---------------------------------------------------------------------------
\14\ Ibid., p.3.
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The NPL cap will also undercut incentives for sound prospective
waste management. Facilities will be able to gamble that States will
lack, or forego use of, cleanup enforcement authorities for tackling
sites created after the NPL list is effectively closed. The continuing
nominal availability of litigation authorities under Sec. 107 is far
from an adequate substitute, given that Sec. 107 suits can only be
brought to recoup expenditures--thus requiring cash-strapped States to
front all the cleanup money.
Where they are unable to do so, today's polluters will evade
cleanup responsibilities, and sites will remain unaddressed.
In short, the cap should be eliminated. As a matter of sound
science and good public policy, EPA should be able to list however many
sites need listing.
IV. Liability Provisions.
There is no dispute that Superfund's existing liability system has
often been abused by polluters that have filed massive contribution
actions against entities with minimal or no connection to the site.
Curbing these abuses is necessary, but does not necessarily require
legislation, since EPA routinely provides contribution protection to
settling parties.
EDF does not oppose carefully crafted provisions that would bar
abuses of the liability system for small parties that won't, as a
practical matter, end up putting much money into a cleanup. Even though
such parties may theoretically qualify as polluters, Superfund's
liability system is and should be pragmatic: it's a way of getting
resources to pay for cleanups from the parties most closely associated
with the site. It simply isn't efficient for litigation to involve
parties who sent only trivial quantities, or who sent wastes that don't
affect cleanup costs, or who clearly won't be able to put more than a
token amount into a cleanup.
If statutory liability relief is to be provided to such parties, as
it is under S.1090, we believe it is imperative to have an appropriate
``pull-back'' provision. We believe the pull-back contained in S.1090
is appropriately crafted. That set of provisions addresses whether the
wastes in question ``contributed significantly'' to response costs
(e.g., [SPCA Sec. 301 (b), adding CERCLA Sec. Sec. 107(r)(2) and
(s)(2), p.46]. The bill's liability-relief provisions provide rough
rules of thumb for parties it probably doesn't make sense to sue, but
they are just that--rough. The pull-back assures that when it really
matters, the liability provisions won't force an anomalous result. For
example, if the one drum that a party sent to a site was full of
dioxin, that party should not be exempted from liability under the de
micromis limitations. Likewise, if a party qualifies for the small-
business exemption (which as discussed below is unduly broad) but was a
primary actor in the events leading to creation of the site, it will be
appropriate to take a hard look at the business to determine just what
its ability-to-pay really is.
With regard to the small business limitation itself, while we do
not necessarily oppose curtailing liability for truly small businesses
with a limited connection to a site who have limited ability-to-pay in
any event, the current exemption is ill-crafted. First, the $3 million
annual-revenue threshold is simply too high [SPCA Sec. 301(b), adding
CERCLA 107(s)(1), p.45]. Moreover, the exemption applies to companies
with either fewer than 75 employees, or less than $3 million gross
revenues. This potentially exempts wealthy corporations that happen to
have relatively few employees (and 75 is a significant number of
employees in any event). If a small-business exemption is to be
adopted, it should use narrower thresholds, and should require meeting
criteria for both numbers of employees and gross revenues.
Conclusion.
Thank you for this opportunity to present our views. We would
welcome an opportunity to work with the committee in crafting a
Superfund bill that reinstates the taxes, adopts narrowly drawn
liability-relief provisions to make the liability system operate more
effectively, and preserves the basic structure of this important
statute.
______
Analysis & Perspective
superfund site remedies
Congress created the requirement for 5-year reviews of Superfund
site remedies chosen by the Environmental Protection Agency that leave
hazardous contaminants at sites because of a concern that impermanent
remedies require long-term attention and may not remain protective of
human health and the environment. The requirement has not acted as a
disincentive to lower-cost remedies that leave contaminants at sites.
Instead, EPA has largely given the effort a low priority. The 5-year
review program has been highly criticized in two independent government
studies, mainly because EPA was not giving reviews high enough priority
to avoid a backlog, even though the reviews were useful.
EPA's Five-Year Review of Superfund Sites Needs Higher Priority
(By Joel S. Hirschhorn, Ph.D.)
Introduction
Interestingly, the Superfund's 5-year review activity has received
relatively little attention, despite Superfund being one of the most
studied environment programs. The public interest and environmental
community has never focused on the reviews as a means of obtaining
better long-term protection of human health and the environment. Two
government agencies that have examined the Superfund 5-year review
program have been very critical of it, although they also noted how
some reviews identified problems and deficiencies in cleanups.
Joel S. Hirschhorn was a senior associate at the Congressional
Office of Technology Assessment for many years, where he produced many
nationally recognized studies of the Superfund program and participated
in the drafting of the Superfund Amendments and Reauthorization Act,
Resource Conservation and Recovery Act amendments, and the Pollution
Prevention Act. He is now president of Hirschhorn & Associates,
Wheaton, Maryland, providing consulting services to a variety of
clients on Superfund and other types of site cleanups and hazardous
waste issues. He is also editor of Remediation: The Journal of
Environmental Cleanup Costs, Technologies & Techniques, published by
John Wiley.
In its guidance to regional offices, EPA has said that the main
purpose of reviews is ``to determine whether: the remedy remains
protective of human health and the environment; is functioning as
designed; and necessary operation and maintenance is being performed.''
A loss of protectiveness could result from failures of technology,
ineffective monitoring, poor operation and maintenance activities,
changing site conditions and poor implementation of institutional
controls. This paper examines how EPA has implemented the statutory
requirement for 5-year reviews and also identifies some policy options
to improve the program.
EPA Is Required to Conduct Reviews
In the 1986 amendments to the Federal Superfund statute, Congress
mandated that EPA conduct 5-year reviews for remedial cleanups. The
amendments generally placed a priority on Superfund cleanups achieving
permanent remedies based as much as possible on using treatment
technologies, in contrast to containment and institutional control
remedies which left hazardous substances at sites and necessitated
restrictions on using land or ground water. The 5-year review
requirement was devised as a safeguard for those remedies that were not
permanent, because they left hazardous substances on the original sites
and required periodic verification that the cleanups were continuing to
protect human health and the environment. It was realized that a lot
could go wrong with cleanups dependent on: containment of wastes;
systems that had to operate for many years, well-enforced institutional
controls, such as land use restrictions. or natural attenuation
remedies requiring many years of monitoring.
Subsequently, in 1990, EPA finalized the National Contingency Plan
(NCP) as a set of regulations governing the Superfund program, and it
included some specific language on the requirement for 5-year reviews.
It is important to see the exact language in the law and the
regulations and to understand subtle but important differences in the
language used.
The key language in Section 121(c) of the Comprehensive
Environmental Response, Compensation, and Liability Act states:
``If the President [EPA] selects a remedial action that results in
any hazardous substances, pollutants, or contaminants remaining at the
site, the President [EPA] shall review such remedial action no less
often than each 5 years after the initiation of such remedial action to
assure that human health and the environment are being protected by the
remedial action being implemented.'' [emphasis added]
The law also said that EPA would have to take any necessary action
appropriate to assuring protectiveness. Note the use of the word
``any'' in the above statement, which would seem to indicate a very
stringent view of the basis for requiring reviews.
In the subsequent NCP, in Section 300.430(f)(4)(ii), EPA used the
following language:
``If a remedial action is selected that results in hazardous
substances, pollutants, or contaminants remaining at the site above
levels that allow for unlimited use and unrestricted exposure, the lead
agency shall review such action no less often than every 5 years after
initiation of the selected remedial action.'' [emphasis added]
In place of the word ``any'' EPA introduced the concept of not
having unlimited use and unrestricted exposure as a condition
establishing the need for a 5-year review. This could be seen as a
softening of the original statutory requirement. That is, some
hazardous substances, pollutants or contaminants might be left at a
Superfund site, but if the levels were such that there were no
restrictions on use or exposure, then reviews would not be required. In
fairness, one could argue, of course, that it is impossible to remove
absolutely every atom or molecule of hazardous substance from a
Superfund site and, therefore, that the original statutory language was
impractical because it implied leaving absolutely no amount of
contaminants in order to avoid the review requirement.
Pragmatic Interpretation Not Challenged in Court
This more pragmatic NCP interpretation apparently has never been
challenged in court. One potential problem of course is that risk
assessments and cleanup standards could be changed over time so as to
change or remove original restrictions, and doing so could then remove
the requirement for future 5-year reviews. The NCP also clarified that
all Records of Decision (RODs) had to clearly state whether 5-year
reviews were necessary.
In the preamble to the NCP, EPA also said the following: ``EPA
agrees that the review should in general focus on monitoring data,
where available, to evaluate whether the remedy continues to provide
adequate protection of human health and environment. New technologies
will be considered where the existing remedy is not protective, but the
5-year review is not intended as an opportunity to consider an
alternative to a protective remedy that was initially selected.''
In this statement one sees an important EPA perspective that may
have importance for seeing the limitations of reviews where technology
change is an issue. That is, EPA seems to believe that an original
technical approach must be implemented and found nonprotective, rather
than considering as part of a review some newer technology, for
example, to replace a part of an original remedy that may not have been
fully implemented. In contrast, EPA has a remedy update program as part
of its Superfund reforms that is aimed at changing remedies because of
new science or technology if costs can be reduced. However, EPA's 1996
guidance to regions on conducting remedy updates did not consider how
such actions related to 5-year reviews. Nevertheless, according to
EPA's latest summary report for updating remedy decisions, with the
exceptions of Regions I and V, regional offices have indicated in their
plans for implementing the remedy decision reform effort that 5-year
reviews serve as a mechanism for considering remedy changes. This
contrasts to seeing them as only a means to fix original remedies.
A recently announced Federal court decision in Puerto Rico supports
the need for EPA to take the statutory requirement for 5-year reviews
quite seriously (M.R. (Vega Alta) Inc. v. Caribe General Electric
Products, D.P.R., No. 97-2294, 12/3/98). For a Superfund site in Puerto
Rico, a group seeks to require EPA to perform such a review of an
ongoing cleanup. The U.S. District Court for the District of Puerto
Rico agreed to hear the suit and rejected a government motion to
dismiss. The court found that the request to order the review is not a
challenge to the response action, and said that the review ``would not
affect the remedial action or unduly compromise the EPA's limited
resources.''
EPA's Guidance to Regions
EPA headquarters has issued guidance for regional offices, although
regions are always free to disregard the guidance on the basis of site-
specific circumstances. The guidance clearly said that examining
whether a cleanup remained protective meant, for example, if the remedy
depended on containment with a cap, examining whether the cap was still
effective; if the remedy depended on institutional controls whether
they remained in place; and if the remedy included ground water
collection and treatment, whether such a system was performing as
predicted. The main guidance was issued in 1991, after finalization of
the NCP and just in time to handle the first required reviews, and it
set the structure of three distinct levels of reviews, differing mainly
in the scope of review activities. \1\ It was contemplated that the
simplest Level I review would be appropriate in all but a relatively
few cases. Only Level II and III reviews included sampling for getting
new data to confirm existing remedy protectiveness. The guidance also
established two main types of reviews: statutory and policy.
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\1\ EPA, ``Structure and Components of Five-Year Reviews,'' May 23,
1991, OSWER Directive 9355.7-02.
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The statutory sites are those with Records of Decision issued after
the Superfund statute was amended in 1986 to create the requirement for
the-reviews. Statutory reviews apply to National Priorities List sites,
construction complete sites, and sites delisted from the NPL. Policy or
discretionary reviews are for sites that, strictly speaking, did not
legally require reviews but which EPA decided should receive them,
including sites with remedies conducted prior to 1986. From a risk
perspective, of course, both types of sites pose equal needs for
reviews because of hazardous materials left on the site. If anything,
one might even argue that pre-1986 sites might be of lower quality than
later sites, simply because of less experience with Superfund cleanups.
Subsequent supplemental guidance in 1994 was designed to provide a
fourth, even simpler, streamlined and lower-cost review, termed Level
la, appropriate for sites where remedial construction was ongoing. \2\
For example, EPA estimated that 160 to 170 hours were necessary for a
Level I review, but only 30 to 40 hours for a Level la review. Nearly
30 percent of reviews seem to be Level la type. It appeared that the
creation of the Level la reviews was in response to growing criticism,
including by the EPA Inspector General, about the backlog of reviews.
By reducing the scope and cost of many reviews the logic was that EPA
regional offices would be able to conduct more reviews. This guidance
also clarified that reviews were to cover the entire site and all
operable units or multiple remedies. However, none of the EPA guidance
seems to address the tough issue of deciding whether a declaration of
protectiveness or the lack of it requires the same condition for all
parts of a remedy. This supplemental guidance also established
priorities, with the first priority being all statutory reviews, the
second priority being policy reviews where the lead agency has
completed remedial action--and is no longer onsite, and the third
priority being all remaining policy sites. Interestingly, an Office of
Inspector General audit (discussed below) found some inappropriate uses
of the Level la review and ones where problems with the cleanup were
not identified.
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\2\ EPA, ``Supplemental Five-Year Review Guidance,'' July 26 1994,
OSWER Directive 9355.7-02A.
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Second Supplemental Guidance Issued
A second supplemental guidance was issued in late 1995. \3\ It
explicitly said that it was a response to an Office of Inspector
General (OIG) audit of the review program (discussed below). In the
interest of performing more reviews with limited resources, EPA
headquarters encouraged its regional offices to use ``potentially
responsible parties (PRPs) to provide information for 5-year reviews.''
There was no direct attention to or discussion of the obvious issue of
a conflict of interest for PRPs who might lack the objectivity to
identify problems with remedies that they had conceived, implemented,
and paid for. The guidance clarified that regional officials would have
to clearly state whether the remedy is protective, is not protective,
or if it would be protective if certain measures were taken. The
guidance also stressed that if a remedy was determined to lack
protectiveness, then regional offices should present recommendations
for actions, milestones toward achieving protectiveness with clear
timetables, and should also state which agency has oversight
responsibility to ensure that the necessary measures are completed.
This guidance also clarified that ``A Type II or Type III review should
be employed only when site-specific circumstances indicate a need for a
recalculation of the risk, or a new risk assessment, respectively.''
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\3\ EPA, ``Second Supplemental Five-Year Review Guidance,'' Dec.
21, 1995, OSWER Directive 9355.7-03A.
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What merits more attention is the issue of different possible views
about the most fundamental finding that a 5-year review is supposed to
explicitly present as a declaration in the report: about the presence
or absence of protectiveness. There is a need for improved EPA guidance
that addresses the criteria that regional offices should use when
reaching their decision about protectiveness. None of the existing EPA
guidance actually presents specific, detailed clear criteria by which
reviewers could decide what the declaration should be. For example, if
some required part of a remedy (such as a monitoring well) is simply
not functioning or being performed as designed or planned, is that
alone sufficient to issue a declaration that protectiveness is lacking?
Or, is it necessary for the review to document some uncontrolled
releases of hazardous substances, or to document some actual
unacceptable exposure necessary for a declaration of a lack of
protectiveness? If only one operable unit is not functioning entirely
as designed or planned but the remainder of the remedy is all right, is
that situation sufficient to declare that protectiveness is lacking?
The goal of improved EPA guidance should be to remove any ambiguities
about the key decision process regarding protectiveness with regard to
any and all conditions that justify a declaration that protectiveness
is lacking at the time of the review.
This author has been told that EPA headquarters in consultation
with regional offices has been developing new guidance for the reviews
that may be released in summer 1999.
EPA headquarters issues many guidance documents for the Superfund
program and some of these have some connection to 5-year reviews, but
often they do not refer to them. However, the guidance on how land use
is considered in making remedy decisions also included reference to 5-
year reviews. \4\ Under the heading ``Future Changes in Land Use'' the
directive said: ``Where waste is left onsite at levels that would
require limited use and restricted exposure, EPA will conduct reviews
at least every 5 years to monitor the site for any changes. Such
reviews should analyze the implementation and effectiveness of
institutional controls with the same degree of care as other parts of
the remedy. Should land use change, it will be necessary to evaluate
the implications of that change for the selected remedy, and whether
the remedy remains protective.''
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\4\ EPA, ``Land Use in the CERCLA Remedy Selection Process,'' May
25, 1995, OSWER Directive 9355.7-04.
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The issue for conduct of the reviews is whether there is a
sufficient effort to identify problems with institutional controls.
Many institutional controls could be difficult to fully and fairly
evaluate, particularly the extent to which they are implemented as
originally planned. EPA's guidance documents do not provide explicit
details on the extent to which some failure of institutional controls
may constitute sufficient basis for declaring a lack of protectiveness
for a remedy.
Studies of EPA's Program
In early 1995 EPA's Office of Inspector General completed its
independent audit of the 5-year review program. \5\ It found a
substantial backlog of 5-year reviews existed because EPA managers had
not given them a high priority. As is normally done, the audit covered
only a sample of three of the ten EPA regions. It reported that at the
end of fiscal year 1994 only 30 percent of the NPL Superfund sites that
were supposed to have received statutory and policy reviews had
received them. The report concluded that the backlog was generally
caused by the low priority management placed on the reviews and it was
noted that EPA officials who were interviewed often ``appeared to view
the 5-year reviews as a nuisance, and gave the impression that the
reports had little or no value. . . . It was apparent from our
interviews that regional officials did not believe the 5-year reviews
were important.'' The audit also found problems in the quality of
reviews, including ones that did not follow EPA guidance.
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\5\ EPA, Office of Inspector General, ``Backlog Warrants Higher
Priority for Five-Year Reviews,'' Audit Report, March 24,1995.
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On the positive side, the OIG audit found that the ``reviews were
valuable tools to identify successful remedies or those remedies that
have developed problems or have failed.'' This clearly made EPA's
backlog significant. In one case, a site visit found that required
surface water sampling had not been conducted for years and that a
landfill cover had been damaged. The reviews were also important for
checking on Operation & Maintenance (O&M) activities and cited an
example where a review activity had found a dead animal inside a
monitoring well that rendered it ineffective. The main recommendation
was that the Superfund program should give a higher priority to the
reviews. For the audit's sample of review reports, some 31 percent were
deemed to lack protectiveness.
One specific result of the OIG audit was that EPA headquarters
created a lower cost review and it said that it would take action to
increase the priority of the reviews. This author has been told that
the OIG is currently conducting a followup audit of the 5-year review
program.
A study by the congressional General Accounting Office of the
Superfund program also examined the reviews and generally supported the
findings of the OIG audit. \6\ GAO concluded that ``these reviews have
often revealed potential and actual problems that the states or
responsible parties have had to correct. However, the agency has a
significant backlog of overdue reviews and consequently may be unaware
of deteriorating conditions at some sites.'' At the time of the GAO
study there was no clear indication that the backlog problem was being
solved and GAO said that ``the agency may not be aware of problems that
may be occurring at other Superfund sites.''
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\6\ GAO, ``Superfund Operations and Maintenance Activities Will
Require Billions of Dollars,'' Sept. 1995.
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More specifically, GAO reviewed O&M activities at 57 sites,
including 43 sites at which 5-year reviews had been performed and at
three of these GAO conducted case studies. In one case GAO found that
the EPA review revealed that the site's responsible party had not been
sampling ground water as was required. The review caused a sampling
plan to be implemented. At another Superfund site GAO found that a
review had discovered that no required maintenance had been implemented
and that trees were growing on the landfill cover, a most serious
problem. For another site, EPA recommended that the state conduct
surface water sampling more frequently, because of high contaminant
levels.
Why Not a High Priority?
Clearly, both the OIG and GAO studies verified the wisdom of the
congressional mandate and they identified the paradox of 5-year reviews
being very useful tools but that EPA was not giving them a high
priority. The OIG report made a point about the benefit of EPA
identifying problems with cleanups ``before serious damage occurs or
they become a public scandal.'' But it seems that EPA Superfund
managers did not see the reviews in the same positive way. Why? The
most logical interpretation is that EPA officials in regional offices
were not motivated to identify problems or deficiencies with ``their''
cleanups. Moreover, despite the OIG and GAO reports, there was no
widespread interest in the subject by environmental or public interest
groups. EPA's assertions that the backlogs found by the OIG and GAO
studies were an inevitable consequence of inadequate resources seem
implausible considering the relatively low costs of conducting reviews,
nor were they consistent with the attitudes of EPA staff found by the
OIG audit.
In 1996 a professional paper was given at a major conference on
this same subject. \7\ The paper presented a good review of EPA's
program. Other than informing professionals about EPA's implementation,
the paper focused on presenting a summary of opportunities for PRPs to
reduce cleanup costs by participating in the review process. The paper
noted that PRPs were slated to pay the majority of the many billions of
dollars for O&M activities at Superfund sites. While concerned citizens
would likely see reviews as a major opportunity for the government to
identify deficiencies with cleanups in progress or completed, PRPs
could see reviews very differently, because they could focus on how
some O&M activities might be reduced or eliminated. The paper noted
that ``USEPA recognizes that PRPs may propose additional response
actions to reduce O&M activities or to contain rising O&M costs.'' The
paper identified nine specific indicators of opportunities to reduce
costs. These included, for example, reducing monitoring requirements,
changing cleanup standards, and changing O&M activities.
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\7\ J.L. Pintenich, ``Components, Levels, and Opportunities In The
Five-Year Review Process,'' Proceedings of Hazwaste World and Superfund
XVII Conference, Oct. 1996.
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EPA Conducts Contractor Study of Review Program
EPA has had its own contractor study of the 5-year review program
to collect data and perform analysis to help EPA improve its 5-year
review program. The study was conducted in the summer of 1997 and
examined 100 first 5-year review reports prepared by all ten EPA
regional offices. There also were data on the number of first 5-year
reviews completed by regions versus the number of reviews remaining to
be completed through fiscal year 2000. Only a small fraction had been
completed, generally much less than 10 percent. Of the 100 reviews
studied, 98 percent fit EPA's Level I or Ia and 2 percent were Level
II; there were none in the Level III category. The Level I and Ia
reviews are the smallest efforts, Level II is more extensive, and Level
III even more extensive (as discussed above). The most important
purpose of a review is to provide a statement whether the site remains
protective of human health and the environment. The study found that 72
percent of reviews provided statements that the remedy remained
protective, 10 percent had information that implied protectiveness, 13
percent did not have an explicit statement because the remedy was still
being implemented, 2 percent had no required statement or implicit
information, and only 2 percent stated that the remedy was not
protective. One review said that further investigation was necessary to
determine protectiveness.
The study also found that 55 percent of reviews made
recommendations, with the most common types being: improve O&M (30
percent), upgrade the remedy (16 percent), conduct additional
evaluation or investigation (13 percent), and repair the remedy (9
percent). Considering that only 2 percent of the reviews said that the
remedy had not remained protective, the fact that 25 percent needed
upgrading or repair is quite interesting, certainly suggesting that the
reviews had found protectiveness either diminished or in jeopardy. It
also suggests that EPA regional offices may be very reluctant to
officially declare that a remedy they originally conceived and approved
is explicitly declared as not being protective. Interestingly, nearly
all of these 25 percent resulted from Level I or la reviews, the most
minimal types of reviews. It might be reasonable to speculate that more
intensive reviews (Level II or III) could be even more effective in
identifying problems with remedies, if they were truly objective and
impartial.
Importantly, the OIG report that examined 26 review reports from
Regions III, V and VI found that eight of them, or 31 percent,
``indicated that the remedies were not protective of human health and
the environment.'' In addition to 16 reports declaring that the
remedies were protective, two reports provided no conclusion about
protectiveness. This result of a 31 percent remedy failure rate is
quite inconsistent with the contractor study finding that only 2
percent were not protective. However, the answer may be that the
combined total of the 25 percent discussed above and the 2 percent
explicitly declaring remedies non-protective is what should be compared
to the OIG value of 31 percent, because many review reports
(particularly older ones) may have to be interpreted as to their basic
determination about protectiveness. EPA's contractor may have been less
objective or less willing than the OIG audit to interpret review
reports as saying that there was a lack of protectiveness.
Comparing EPA's Annual Reporting With Studies
The Superfund statute also required EPA to report to Congress on
the 5-year reviews, including ``the results of all such reviews.'' In a
1989 report EPA said it ``will report annually the results of all 5-
year reviews that were conducted during the preceding 12 month
period.'' \8\ This author was told by an EPA headquarters official that
this reporting has been done as part of EPA's annual Superfund reports.
However, these reports to Congress on the progress of the Superfund
program seem to have been stopped by EPA several years ago. The three
most recent Superfund reports are available on the EPA's World Wide Web
site, with the most recent one being for fiscal 1994. Thus, EPA has not
fulfilled its commitment to reporting on the 5-year review program for
4 years (i.e., fiscal 1995 through fiscal 1998).
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\8\ EPA, ``A Management Review of the Superfund Program,'' 1989. In
this report EPA made a commitment that no NPL site would be delisted
without receiving at least one 5-year review. However, a recent Amended
ROD for the Munisport Superfund site in Florida explicitly committed to
delisting and said that no 5-year review was necessary even though the
limited remedial action had clearly not produced a condition for future
unrestricted use.
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The following information was retrieved from the three reports: in
fiscal 1991 there was one review (i.e., consistent with first guidance
in that year), in fiscal 1992 there were three statutory reviews and
three policy reviews; in fiscal 1993 there were six statutory reviews
and 1-9 policy ones; in fiscal 1994 there were 15 statutory reviews and
10 policy ones. Note that in fiscal 1993 out of the 22 statutory
reviews required in that year only four were conducted, and in fiscal
1994 out of the 39 required only 10 were conducted. Clearly, statutory
reviews were not receiving the highest priority, which may explain the
priority-setting in the 1994 guidance. The fiscal 1992 report did not
reveal how many reviews were required in that year. The grand total for
fiscal 1991 through fiscal 1994 was 57 reviews. For fiscal 1993 and
fiscal 1994 the percent of required reviews actually performed in the
required years was 23 percent (ices, 14 of 61).
These data support the conclusions by OIG and GAO concerning a
backlog of unperformed, required reviews. Also, EPA's 1997 contractor
study indicated that the 100 first-year reviews examined represented
only 11 percent of the total of 930 reviews required by fiscal 2000;
however, it is likely that those 100 reviews represented what was
accomplished through fiscal 1996, leaving 4 years to accomplish the
remaining 89 percent. However, considering that only 25 required
reviews were conducted in the period of fiscal 1991 through fiscal
1994, and probably 75 more in fiscal 1995 and fiscal 1996, it seems
that there is still a major backlog of required reviews.
As to the results of the reviews, the annual reports presented
minimal information. It was said that nearly all the reviews confirmed
the protectiveness of the remedies. Although, as discussed above, the
problem may be a difference between the technical substance in review
reports versus what is explicitly declared in terms of the presence or
absence of protectiveness. There was only one description of a review
finding a problem and addressing it. This was for a site handled in
fiscal 1992 where the review recommended-development of more
enforceable deed and land use restrictions, which were subsequently
implemented. This apparent fraction of one site that may have had a
determination of nonprotectiveness out of a total of 57 is consistent
with EPA's contractor study that indicated only two out of 100 site
with such a negative finding. But it would not be consistent with the
OIG's finding of some 31 percent lacking protectiveness. It seems fair
to conclude that EPA's official record of reviews through fiscal 1994
was not impressive in terms of identifying cleanup problems or
deficiencies supporting a conclusion of a lack of protectiveness. One
would expect, of course, EPA to take the position that so few reviews
find a lack of protectiveness because EPA has done such a good job in
the first place in conceiving and implementing Superfund cleanups. But
another possibility is that the reviews lack enough effort or
objectivity to accurately identify significant problems indicating a
lack of protectiveness or more likely that they often have not
explicitly stated a lack of protectiveness, even when the technical
findings support such a negative declaration.
It seems fair to conclude that all the available information
indicates that EPA's 5-year review program is far from a success and a
very low EPA priority. It should also be noted that over the past
several years EPA has had a major Superfund reform program consisting
of many different activities and improvements in the program. However,
there was no reform aimed at improving the 5-year review effort. This
is most interesting because of the trend in recent years of increasing
numbers of Superfund cleanups being dependent on containment and
institutional controls. Yet most studies of the Superfund program have
not paid attention to the 5-year review program, even when addressing
relevant issues, particularly long-term effectiveness of remedies. \9\
The lack of attention to the 5-year program by Congress and public
interest groups means that there is no balancing of the likely inherent
low interest within regional offices in using reviews to identify
problems or deficiencies requiring attention and increased spending. In
theory, the 5-year review program is a critically important quality
control program for Superfund cleanups. But there is no evidence that
it has yet functioned in an optimal way. This is not only unfortunate
for Superfund cleanups, but it has failed to set what might have been a
positive example for many other cleanup programs in the country, some
Federal and some state, where there is also increasing use of remedies
that leave hazardous materials at sites. Perhaps, eventually, more
citizens in Superfund communities will ask the logical question: ``Is
this cleanup still working effectively?'' If they do, perhaps then will
EPA and others start to pay more attention to the 5-year reviews.
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\9\ A very good independent study ``Linking Land Use and Superfund
Cleanups--Uncharted Territory,'' by Resources for the Future (June
1997), presented considerable evidence of problems with the long-term
effectiveness of institutional controls at Superfund sites. But even
this study did not examine the 5-year review program. One of the ideas
presented in the report was for EPA to create a new office or for a new
agency to be created ``whose sole responsibility would be long-term
oversight of contaminated sites.'' It also suggested that the Superfund
law ``could require EPA to review land use controls at NPL sites every
3 years (or some relatively short period) and stipulate damages against
landowners who violate property use restrictions specified in consent
decrees or in RODs.'' Another study, ``A Remedy for Superfund--
Designing a Better Way of Cleaning Up America,'' Clean Sites (Feb.
1994), noted the need to ``Establish procedures for long-term control
and oversight of sites that are remediated to less than residential
cleanup levels.'' But it did not even mention the 5-year review
requirement.
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Lastly, it should be noted that no information found on the 5-year
review program has indicated any attention to reviews after the initial
one, and whether regional offices are conducting them in a timely
manner and what they are finding. Since significant numbers of reviews
were first conducted in fiscal 1992 and fiscal 1993, followup reviews
should have already been done at many sites. While it appears that
there is still a major backlog of first 5-year reviews, it is even more
likely that there is a larger total backlog when subsequent reviews for
all sites are considered, including construction complete sites and
sites delisted from the NPL.
Conclusions
Because the 1990's have seen a remarkable increase in cleanups
based on containment, institutional controls, and natural attenuation,
which leave contaminants at sites, there is a major need for senior EPA
managers to refocus their plans and strategies for the Superfund 5-year
review program. Congress was correct in introducing the 5-year review
requirement into CERCLA in 1986, but they could not have anticipated
that it would become increasingly necessary as treatment remedies
became used less frequently. Rather than acting as a kind of
disincentive for remedies that leave contaminants at sites, 5-year
reviews have largely been given little priority or visibility.
Now, Congress should make the 5-year review program a topic to
consider seriously during Superfund reauthorization. Instead of being
buried deep within the bureaucracy, the 5-year review program should be
re-engineered to be the model for all cleanup programs in the United
States, both Federal and state. There is no indication that EPA
regional offices have ever seen the intrinsic benefits of a long-term
quality control program for Superfund cleanups, even though the EPA
Inspector General's office and the General Accounting Office have
clearly identified important benefits of 5-year reviews. Claims of
insufficient resources to conduct 5-year reviews have no credibility.
The real explanation seems to be a widespread reluctance to
impartially review Superfund remedies that the regional offices
themselves have conceived, approved and implemented. Congress should
consider creating some independent office to conduct 5-year reviews
with sufficient resources to ensure timely reviews for all Superfund
sites.
__________
Statement of Mark Gregor, Manager, Division of Environmental Quality,
City of Rochester, New York
Introduction
Chairman Chafee, and members of the committee, my name is Mark
Gregor and I am the Manager of the Division of Environmental Quality
for the City of Rochester, New York. I am here today to testify on
behalf of the National Association of Local Government Environmental
Professionals, or ``NALGEP.'' NALGEP appreciates the opportunity to
present this testimony on the views of local government officials from
across the Nation on the need for additional Federal Legislative end
regulatory incentives to promote the cleanup, redevelopment end
productive reuse of brownfields sites in local communities.
NALGEP represents local government of finials responsible for
ensuring environmental compliance, and developing and implementing
environmental policies and programs. NALGEP's membership consists of
more than 100 local government entities located throughout the United
States, and includes environmental managers, solid waste coordinators,
public works directors and attorneys, all working on behalf of cities,
towns, counties and municipal associations. Our members include many of
the leading brownfields communities in the country such as Chicago,
Portland, Baltimore, Salt Lake City, Los Angeles, Dallas, Cuyahoga
County and others.
In 1995, NALGEP initiated a brownfields project to determine local
government views on national brownfields initiatives such as the EPA
Brownfields Action Agenda. The NALGEP Brownfields Project culminated in
a report, entitled Building a Brownfields Partnership from the Ground
Up: Local Government Views on the Value and Promise of National
Brownfields Initiatives, which was issued in February, 1997. In 1997,
NALGEP was invited to testify on brownfields issues and present the
findings of our report to this committee as well as to the House
Commerce Committee and the House Transportation and Infrastructure
Committee.
During the past 2 years, NALGEP has continued its work on
brownfields through coordinating work groups of local of finials to
address the following issues: (1) Brownfields Cleanup Revolving Loan
Funds; (2) use of Community Development Block Grants for Brownfields;
(3) building partnerships between business and local government of
finials to promote smart growth; and (4) implementing the
Administration's Brownfields Showcase Community initiative. As a result
of these efforts, NALGEP is well qualified to provide the committee
with a representative view of how local governments, and their
environmental and development professionals, believe the Nation must
move ahead to create long-term success in the revitalization of
brownfields properties.
NALGEP's testimony today will focus on the following areas: ( 1 )
the continued need for Federal funding to support the cleanup and
redevelopment of brownfields sites across the country; (2) the need for
further liability clarification to encourage the private sector to step
forward and revitalize more sites; and (3) the need to facilitate the
participation of other Federal agencies (e.g., Army Corps of Engineers,
Department of Transportation, HUD) in supporting local brownfields
initiatives.
The cleanup and revitalization of brownfields represents one of the
most exciting, and most challenging, environmental and economic
initiatives in the nation. Brownfields are abandoned, idled, or under-
used industrial and commercial properties where expansion or
redevelopment is hindered by real or perceived contamination. The
brownfields challenge faces virtually every community; experts estimate
that there may be as many as 500,000 brownfields sites throughout the
country.
The brownfields issue illustrates the connection among
environmental, economic and community goals that can be simultaneously
fostered through a combination of national leadership, Federal and
State incentives, and the innovation of local and private sector
leaders. Cleaning up and redeveloping brownfields provides many
environmental, economic and community benefits including:
expediting the cleanup of thousands of contaminated sites;
renewing local economies by stimulating redevelopment, creating
jobs and enhancing the vitality of communities; and
limiting sprawl and its associated environmental problems such as
air pollution, traffic and the development of rapidly disappearing open
spaces.
rochester's brownfields initiative
During the last 5 years, the City of Rochester, New York has
completed the redemption of more than 50 acres of brownfields sites
including the site of Bausch and Lomb's new corporate headquarters, the
site of a new Federal Aviation Administration funded Aircraft Rescue
and Fire Fighting facility, and the site of the state-of-the-art
Rochester/Monroe County ``911'' Center.
The City of Rochester was selected as one the first round of
brownfields pilot cities by the U.S. Environmental Protection Agency.
Rochester was also awarded a Brownfields Cleanup Revolving Loan Fund
grant from EPA.
Using the EPA pilot grant funds for investigation and City funding
for cleanup, Rochester has remediated 15.5 acres that were once
junkyards, fuel depots, and a rail yard and is now the Erie Canal
Industrial Park. Rochester is also in the process of establishing a
site investigation funding program using EPA funding.
The Federal Government, particularly the U.S. EPA, has played an
important role in helping Rochester develop and advance our brownfields
redevelopment efforts. They have provided critical funding to enable us
to institutionalized local program and to help investigate and clean up
specific sites. They have provided technical assistance and other
resources that have helped us learn from other communities and take on
the many challenging obstacles to brownfields revitalization. They have
helped connect us with other Federal agencies that have resources and
technical expertise. And perhaps, most importantly, they have provided
the critical leadership needed to educate the many stakeholders and the
general public that redeveloping brownfields can be done and that it
can provide significant economic and environmental benefits for
communities across the nation.
Several barriers, however, continue to hamper brownfields cleanup
and redevelopment in Rochester and other communities. New Federal
legislation to further clarify and provide some limits on the liability
of ``non-responsible'' new owners of brownfields sites that voluntarily
complete cleanups would be an important stimulus to the reuse of many
brownfields. Additional Federal funding in the form of grant and loan
programs continues to be important especially for cities like Rochester
that have a declining tax base and falling assessed properly values. It
is also important that the many Federal agencies that become involved
in aspects of the brownfields problem recognize the important effects
that funding and policy decisions can have toward promoting brownfields
reuse and not encouraging sprawl conditions in our suburbs and rural
areas.
brownfields legislative needs
I. Ensuring Adequate Resources for Brownfields Revitalization
NALGEP finds that to ensure long-term success on brownfields, local
governments need additional Federal funding for site assessment,
remediation and economic redevelopment. The costs of site assessment
end remediation can create a significant barrier to the redevelopment
of brownfields sites. In particular, the costs of site assessment can
pose an initial barrier that drives development away from brownfields
sites. With this initial barrier removed, localities are much better
able to put sites into a development/rack. In addition, the allocation
of public resources for site assessment can provide a signal to the
development community that the public sector is serious about resolving
liability issues at a site and putting it back into productive reuse.
The use of public funds for the assessment and cleanup of
brownfields sites is a smart investment. Public funding can be
leveraged into substantial private sector resources. Investments in
brownfields yield the economic fruit of increased jobs, expanded tax
bases for cities, and urban revitalization. And the investment of
public resources in brownfields areas will help defer the environmental
and economic costs that can result from unwise, sprawling development
outside of our urban centers.
The following types of Federal funding would go a long way toward
helping local communities continue to make progress in revitalizing our
brownfields sites:
Grants for Site Assessments and Investigation: EPA's Brownfields
Assessment Pilot grants have been extremely effective in helping
localities to establish local brownfields programs, inventory sites in
their communities, investigate the potential contamination at specific
sites, and educate key stakeholders and the general public about
overcoming the obstacles to brownfields redevelopment. Additional
funding for site assessments and investigation is needed to help more
communities establish local brownfields programs and begin the process
of revitalizing these sites in their communities.
Grants for Cleanup of Brownfields need for Federal grants to
support the cleanup of brownfields sites across the country. The U.S.
Conference of Mayors' recent report on the status of brownfields sites
in 223 cities nationwide indicates that the lack of cleanup funds is
the major obstacle to reusing these properties. For many brownfields
sites, a modest grant targeted for cleanup can make the critical
difference in determining whether a site is redeveloped, creating new
jobs and tax revenues or whether the site remains polluted and idle.
Grants to Capitalize Brownfields Cleanup Revolving Loan Funds:
Federal funding to help localities and States establish revolving loan
funds (RLFs) for brownfields cleanup is another effective mechanism to
leverage public and private resources for redevelopment. EPA deserves
credit for championing brownfields RLFs as a mechanism for helping
communities fill a critical gap in cleanup funding. Unfortunately, the
effectiveness of the EPA's current brownfields cleanup RLF program is
severely undermined by the lack of new Federal brownfields legislation.
Under current law, localities are required to jump through and over
numerous National Contingency Plan (NCP) bureaucratic troops and
hurdles to establish/heir local RLFs. These NCP requirements were
originally established for Superfund NPL sites and not for brownfields
sites. Consequently, we strongly recommend that any new legislation
make it clear that local brownfields RLFs are not required to meet the
NCP requirements established for Superfund sites.
II. Clarification of Superfund Liability at Brownfields Sites
On the issue of Federal Superfund liability associated with
brownfields sites, NALGEP has found that the Environmental Protection
Agency's overall leadership and its package of liability clarification
policies have helped establish a climate conducive to brownfields
renewal, and have contributed to the cleanup of specific sites
throughout the nation. It is clear that these EPA policies, and
brownfields redevelopment in general, are most effective in States with
effective voluntary cleanup programs. Congress can enhance these
liability reforms by further clarifying in legislation that Superfund
liability does not apply to certain ``non-responsible'' parties such as
innocent landowners, prospective purchasers and contiguous property
owners.
NALGEP has also found that EPA's initiative to negotiate
``Superfund Memoranda of Agreement'' (MOAs) with States that have
effective voluntary cleanup programs has helped to facilitate
brownfields cleanups in those States. Specifically, these MOAs defer
liability clarification authority to those States. In order to further
facilitate brownfields cleanups across the country, NALGEP finds that
Congress should enable the EPA to delegate authority to limit liability
and issue no further action decisions for brownfields sites to States
with cleanup programs that meet minimum requirements to protect public
health and the environment.
A strong delegation of EPA liability clarification authority to
approved States is critical to the effective redevelopment of local
brownfields sites. Such delegation will increase local flexibility and
provide confidence to developers, lenders, prospective purchasers and
other parties that brownfields sites can be revitalized without the
specter of Superfund liability or the involvement of Federal
enforcement personnel. Parties developing brownfields want to know that
the State can provide the last word on liability, and that there will
be only one ``policeman,'' barring exceptional circumstances.
At the same time, local officials are also concerned about
delegating too much cleanup authority too fast to States. States vary
widely in the technical expertise, resources, staffing, statutory
authority and commitment necessary to ensure that brownfields cleanups
are adequately protective of public health and the environment. If
brownfields sites are improperly assessed, remediated or put into
reuse, it is most likely that the local government will bear the
largest brunt resulting from any public health emergency or
contamination of the environment. NALGEP believes that the U.S. EPA has
a key role to play in ensuring that liability authority over
brownfields sites should only be delegated to States that demonstrate
an ability and commitment to ensure protection of public health and the
environment in the brownfields redevelopment process.
To foster expanded redevelopment of brownfields sites while
ensuring the protection of public health and the environment, NALGEP
finds that there should be three components to the EPA brownfields
delegation program. First, the law should clearly distinguish between
Superfund NPL sites and other sites subject to enforcement under CERCLA
or RCRA on one hand, and the remaining sites that can be put on a
``brownfields track.'' The delegation of liability authority to States
should focus on these ``brownfields back'' sites. Putting sites on a
brownfields back will allow the application of EPA and State policy
tools specifically designed to foster expedited, cost-effective
brownfields redevelopment.
Second, NALGEP finds that EPA delegation of liability authority
over brownfields sites should be granted only to State cleanup programs
that can ensure protection of public health and the environment. NALGEP
suggests the following types of criteria for State delegation:
1. Mechanisms to ensure adequate site assessments early in the
process. Good site assessments will help prevent unanticipated problems
from surfacing, and facilitate efforts to direct particular sites into
a ``brownfields track.''
2. Adequate State technical expertise, staff and enforcement
authority to ensure effective implementation of cleanup activities.
3. Use of risk-based cleanup standards, that can be tied to
reasonably anticipated land use, established through an adequate public
approval process.
4. Institutional controls such as deed restrictions, zoning
requirements or other mechanisms that are enforceable over time to
ensure that future land uses tied to certain cleanup standards are
maintained.
5. Commitment to establish community information and involvement
processes, and assurance that State and local brownfields activities
will consider community values and priorities.
6. Commitment to build the capacity, through training and technical
assistance, of local government hearth and environmental agencies to
affectively participate in the brownfields development process and
ensure protection of public health and environment.
7. Adequate mechanisms to address unanticipated cleanups or
orphaned sites where liability has been eliminated.
Finally, NALGEP believes that EPA's ability to reopen its
involvement at a particular brownfields site in a delegated State
should be limited to situations where there are exceptional
circumstances and the State is not effectively addressing the problem.
An EPA reopener for particular sites is necessary to ensure that EPA
can become involved at any sites at which the State is unable or
unwilling to adequately respond to a substantial and imminent threat to
public health or the environment. At the same time, the reopener must
be sufficiently limited to permit the State to take the lead role at
brownfields sites, and to give confidence to developers, prospective
purchasers, lenders and local governments that EPA will not improperly
hinder or interfere in State liability decisions.
Therefore, in delegating brownfields authority for non-NPL caliber
sites to the States, NALGEP proposes that: EPA should provide that it
will not plan or anticipate further action at any sites unless, at a
particular site, there is: (1) an imminent and substantial threat to
public health or the environment; and (2) either the State response is
not adequate or the State requests U.S. EPA assistance.
III. Facilitating the Participation of Other Federal Agencies in
Brownfields Revitalization
The cleanup and redevelopment of a brownfields site is often a
challenging task that requires coordinated efforts among different
government agencies at the local, State and national levels, public-
private partnerships, the leveraging of financial resources from
diverse sources, and the participation of many different stakeholders.
Many different Federal agencies can play a valuable role in providing
funding, technical expertise, regulatory flexibility, and incentives to
facilitate brownfields revitalization. For example, HUD, the Economic
Development Administration, the Department of Transportation, and the
Army Corps of Engineers have all contributed important resources to
expedite local brownfields projects. The U.S. EPA and the
Administration have provided strong leadership through the Brownfields
Showcase Project to demonstrate how the Federal Government can
coordinate and leverage resources from many different Federal agencies
to help localities solve their brownfields problems.
Congress can help strengthen the national brownfields partnership
by further clarifying that the various Federal partners play a critical
role in redeveloping brownfields and by encouraging the agencies to
work cooperatively to meet local needs. For example, Congress should be
commended for Legislation passed last year to clarify that HUD
Community Development Block Grant funds can be used for all aspects of
brownfields projects including site assessments, cleanup and
redevelopment. This simple step has cleared the way for communities
across the country to use these funds in a flexible fashion to meet
their specific local needs. Similarly, Congress should take a look this
year at clarifying that it is appropriate and desirable for the Army
Corps of Engineers to use its resources and substantial technical
expertise for local brownfields projects. In addition, Congress should
consider clarifying that Department of Transportation funds can be used
for cleanup activities associated with various transportation projects.
Congress also should work with EPA to determine how other agencies can
help facilitate more brownfields revitalization. By taking these steps,
Congress can give communities additional tools, resources, and
flexibility to overcome the many obstacles to brownfields
redevelopment.
conclusion
In conclusion, local governments are excited to work with the
Federal Government to promote the revitalization of brownfields,
through a combination of increased Federal investment in community
revitalization, further liability clarification, and other mechanisms
to strengthen the national partnership to cleanup and redevelop our
communities. NALGEP thanks the committee for this opportunity to
testify, and looks forward to working with you as the process moves
forward.
__________
Statement of Mike Nobis, National Federation of Independent Business
Mr. Chairman and distinguished members of this committee, my name
is Mike Nobis and I am from Quincy, Illinois. I would like to thank you
for allowing me to speak to you today and to share my hometown's
experiences with a landfill that became a Superfund site. I am the
General Manager and part owner of JK Creative Printers. My company,
which our family has owned for almost 30 years, employs 43 full time
people. We are proud to be members of the National Federation of
Independent Business (NFIB) and are honored to present this testimony
on behalf of NFIB's 600,000 small business owner members.
Quincy is a small community of 42,000 people, located on the banks
of the Mississippi River just 150 miles north of St. Louis, MO. Our
town is a great place to live and to raise a family. We have enjoyed
years of good economic growth, good schools, strong community
involvement and good city leadership. Of all the expectations we have
for our town, having our local landfill declared a Superfund site was
not one of them. In 1993, the Mississippi River reached its highest
flood stages in history prompting our community to rally together and
beat back the flood and its effects. Now, my community has been forced
to band together again--to fight the unfairness of a Superfund law that
is punishing us for legally disposing of our trash. Companies that once
worked together to save our town from the flood, are now suing each
other because of this Superfund landfill. Companies who have worked
together for so many years are now suing one another.
For my company, it started on February 10, 1999 when we received a
letter in the mail from the EPA that stated 6 large local corporations
and the city were looking to recover some of their cost for the cleanup
of our local landfill. Even though what we had hauled there was only
trash and totally legal, EPA said that because our trash was sent to
that site, we were potentially responsible for paying our proportional
share of the cleanup.
When I read the letter, I felt sick. For me and the 148 other
companies that received the letter, it was unexpected and without
warning. At first, we had no idea of what the letter was telling us. It
was asking us, as small companies, to ``contribute'' $3.1 million. I
laughed at the language they used, contribute. They weren't asking us
to contribute; they were threatening us to pay. My company's designated
amount to pay was $42,000, and I consider myself lucky. There were
several other companies and individuals being asked to pay $70,000,
$85,000 and some to pay over $100,000. As I read through the list, I
saw Catholic grade schools, our local university, bowling allies,
restaurants, small Mom and Pop trash haulers, furniture stores and our
local McDonald's listed to pay. Most of the companies named only
generated waste like plain office trash or food scraps. In the mid
70's, when our company's trash began to be put in the landfill, I was
in college. One of the owners of another company was only 7 when this
landfill was in use. Yet we are being held responsible. The document
made it sound as though we were major hazardous waste dumpers. Yet,
nowhere in the document did it list what waste we were accused of
dumping. It only said that our trash was hauled to the landfill during
the time in question and we now have to help pay for the cleanup,
regardless of the fact that there was no other place to dump our trash.
On February 24, 1999, the EPA sent one of their attorneys to Quincy
to help explain the letter and to answer questions. The meeting lasted
for over 2 hours. The EPA attorney tried to answer questions and to
comment on how the law was being applied. Many people stood up and
pleaded their situations and how unfair and un-American this whole
situation was. He admitted to everyone there that the law was probably
unfair and very harsh. He said it was intended to be harsh, but he
couldn't do anything about its unfairness. Even though the law seemed
unfair, he said that it was all he had to work with.
EPA and the 6 large companies weren't concerned about the waste
that was sent to the landfill. The make-up of what we sent there was
irrelevant. It was the volume that we sent to the landfill that they
cared about, even if the trash was not dangerous. They knew we didn't
send hazardous waste and they knew we couldn't afford to fight them. We
became an easy money source for them because of the real threat of
litigation by the 6 large companies. And when you think about it, what
small company can take on 6 large corporations and the EPA alone and
win? If we didn't accept the settlement offer, the big 6 would sue us
for the entire cleanup cost. We were stuck. Pay up or be wiped out. The
attorney for the EPA admitted that it would cost us more to fight them
in court to prove we didn't haul hazardous waste to the landfill than
to just go ahead and settle. It all came down to money . . . . and they
had more than we did.
Who were the companies forced to pay this settlement? Most of the
companies were individual people. Some were independent trash haulers;
mom and dad hauling to help supplement their income to help raise their
families. If you talk to them, you will notice they didn't make much
money hauling trash. Others were small building contractors. Some are
people in their retirement years. Some are widows whose husbands have
passed away and they now have this settlement to deal with. Some are
sons whose fathers once owned the business and now, years later, they
have inherited the problem. We have business owners who bought
businesses a few years ago who had nothing to do with this landfill,
yet are being forced to pay up because they now own the assets and are
the present money source. If they could have known this liability was
going to be theirs in the future, they never would have bought the
business. Mothers and fathers would have been reluctant to pass a
family business--and its liability--to the next generation. We have
some men in their late 70's and early 80's that could lose their life's
savings when they should be enjoying their retirement years. They are
spending their time and money paying the EPA for something they did 25
years ago that was legal. Are these the people Superfund was designed
to collect from or has something gone wrong? It is needless business
pressures like this that destroy small businesses and cause undo pain
and hardship. Victimizing small businesses is not going to help speed
the cleanup of Superfund sites. Most of the cost contributed by our
companies to this site didn't clean one ounce of the landfill. The
money went to attorneys. Of all the money spent, the attorneys got the
most. Consider how much the EPA and the big 6 gave attorneys in order
to get the settlement with the 149 small companies. The EPA itself
admits that 2/3 of the money in the Superfund is spent on litigation,
not cleaning up the hazardous sites. The estimate for the legal help
that some of us received in Quincy (not including the settlement
amounts) is close to $500,000. This is hard stuff. And for what? Who
wins? The attorneys are the winners. It was just reported in our local
newspaper that the EPA and the 6 corporations are now suing all those
companies who didn't settle, resulting in more business for the
attorneys. As I understand it, these companies will be allowed in later
months to bring third party lawsuits. Where will it end? I do not think
this law's intent is to place hardships on small business when the
ultimate winners are the attorneys, not the environment.
To me and the thousands of small business owners that have been in
my shoes, Superfund is not some abstract policy. Superfund affects
small businesses, and has devastated my friends and neighbors, both
emotionally and financially. Why? For doing the right thing 20-some
years ago. I greatly admire the strength of Barbara Williams who has
addressed this committee in the past. But, there are tons of small
business owners that don't have the courage to fight. What will happen
to those small businesses if we let this continue unchecked?
Today our country's leaders need to look again at the intent of
this law called Superfund. I don't believe you intended for it to
burden or destroy individuals and small businesses in order to clean up
hazardous sites. We have a chance to help small businesses get out from
under this problem by supporting the language in the Superfund Program
Completion Act of 1999.
I commend this committee for looking seriously at this problem, and
hope that this is the year small business owners will gain freedom from
this unfair system. Small businesses need your help now. Please change
this law for the benefit of small business owners and help restore some
common sense to the Superfund law.
__________
Statement of Red Cavaney, President, American Petroleum Institute
Introduction
This statement is submitted to accompany the testimony of Mr. Red
Cavaney, President of the American Petroleum Institute, before the
Committee on Environment and Public Works, U.S. Senate, May 25, 1999,
regarding S. 1090, the Superfund Program Completion Act of 1999. API
represents approximately 400 companies involved in all aspects of the
oil and gas industry, including exploration, production,
transportation, refining, and marketing.
API supports the provisions of the Chafee-Smith bill and applauds
the sponsors for moving the Superfund debate a giant step forward. The
legislation addresses the difficult and complex issue of liability
reform--one of the central problems that has plagued the program; it
moves the program toward completion by capping the number of sites to
be added to the National Priority List and increasing the
responsibility of the States for administering cleanup activity; it
addresses the emerging issue of Brownfields rehabilitation; and, it
appropriately recognizes that the Superfund program should be funded
with general revenues.
To be sure, the Superfund program needs additional repairs which we
will address later in this testimony. However, as the sponsors of
S.1090 so correctly note, the Congress and this Administration have
been unable to find acceptable compromises on those issues. The lack of
agreement on those issues should not prevent Congress from making the
important changes embodied in the Chafee-Smith bill.
General Revenue Funding
API wholeheartedly supports the intention of the sponsors of the
Chafee-Smith bill to authorize general revenue funding of the Superfund
program. As we have previously stated before this committee and others,
the petroleum industry has a unique perspective with regard to
Superfund. Petroleum-related businesses are estimated by EPA to be
responsible for less than 10 percent of the contamination at Superfund
sites; yet these businesses have historically paid over 50 percent of
the taxes that were imposed to support the Trust Fund. This inequity
has been of paramount concern to our members and must be rectified. The
attached charts illustrate the unfair tax burden that has been imposed
on our industry.
Between 1982 and 1996, 74 percent of the Superfund program's
funding came from specific Superfund taxes on industry (the petroleum
tax, the chemical tax, and the corporate environmental income tax).
During those years, the petroleum industry's share of annual taxes paid
to Superfund ranged from 53 percent to 63 percent, averaging 57 percent
over the entire period.
EPA officials have claimed that using general revenues to pay for
Superfund would be deserting the ``polluter pays'' principle and would
be ``letting polluters off the hook.'' That is simply not true and does
not reflect the reality of the Superfund program.
The Superfund program was created to pay for the cleanup of
``orphan'' waste disposal sites--those whose owners no longer exist
(corporate owners) or who have died (individuals), or whose owners are
bankrupt. Under the joint and several liability scheme of Superfund,
once responsible parties are identified, the Fund itself is not looked
to as the primary source of cleanup funding--unless those parties are
insolvent. In fact, by the mid-1990's, the Superfund program had
identified at least one potentially responsible party at 93 percent of
nonFederal sites on the National Priority List. In other words, by that
time only 7 percent of nonFederal sites on the NPL remained ``orphan''
sites requiring cleanup by EPA.
In addition to covering the cleanup costs of ``orphan sites,'' EPA
has been using the Superfund--funded with dedicated taxes--to pay
administrative costs and for other purposes. In fact, EPA's use of
Superfund moneys for other purposes has increased to such a degree that
the General Accounting Office (GAO) reported that in 1998 only 46
percent of the expended funds covered direct cleanup costs. Fifty-four
percent paid the salaries of EPA officials, program administration, and
other extraneous costs. The committee is well aware of other GAO
findings--EPA's failure to recover all allowable costs from responsible
parties, continued high program costs related to contractors, and EPA's
failure to deobligate and recover unspent funds from completed
Superfund contracts, to name just a few.
EPA has reported recently that cleanup projects at 90 percent of
the nonFederal Superfund sites are either completed or under
construction, and responsible parties are performing 70 percent of all
new remedial work. The funding needs of the program are declining and
will continue to decline. It makes sense for Congress to use general
revenues to pay for orphan shares and administrative costs in the
remaining years of the program, just as the Chafee-Smith bill
contemplates.
No Restrictions on Use of General Revenues
Despite claims by some to the contrary, both GAO and the
Congressional Budget Office have stated there is no legal or Budget Act
restriction on the use of general revenues to fund the Superfund
program. An explanation of the relationship and operation of the
Superfund Trust Fund and appropriations for the Superfund program may
be helpful.
Historically the Superfund Trust Fund has received revenues from
two main sources: dedicated taxes and general revenues. The dedicated
taxes have included a chemical feedstock tax, a crude oil tax, and a
general corporate environmental income tax. Those taxes expired at the
end of 1995.
The general revenue funding is transferred from the General Fund to
the Trust Fund in the annual VA, HUD, and Independent Agencies
appropriations bill, and that same bill appropriates money from the
Superfund Trust Fund for annual Superfund program spending. The
Superfund Trust Fund also collects revenues from interest on the moneys
in the Fund, fines and penalties imposed under the Superfund program,
deferred tax collections, receipts from deobligated funds, and cost
recoveries from responsible parties.
Under the Congressional Budget Act, the Superfund Trust Fund is
considered to be ``on-budget'' for purposes of the unified budget. Any
taxes dedicated to the Trust Fund are treated as revenues for purposes
of the overall Federal budget, and any spending from the Trust Fund is
included in the total spending for the Federal Budget. However,
transfers between the General Fund and the Trust Fund (such as for
interest or direct transfers of general revenues) do not have any
budgetary impact.
Superfund is a discretionary domestic program subject to the same
budget rules that apply to all discretionary spending. The Trust Fund
balance does not affect the amount that can be appropriated for the
Superfund program. In other words, the discretionary spending caps,
rather than the Trust Fund balance, control the Superfund program's
spending level.
To summarize the foregoing explanation, appropriations for the
Superfund program are not connected to, and do not depend on, any
dedicated taxes. Thus, concerns that without reinstatement of the taxes
the Superfund program would grind to a halt are completely unfounded.
Brownfields
The Chafee-Smith bill addresses the issue of brownfields
rehabilitation by establishing grants for site investigation and
remediation, and providing liability relief for innocent landowners and
prospective purchasers of contaminated properties. API has supported
brownfields reform as part of a comprehensive Superfund
reauthorization. In addition, we have been concerned that the funding
for this program not come from the Superfund Trust Fund and the Chafee-
Smith bill funds the program through general revenues. API members have
identified the following elements as essential in development of a
brownfields program:
The remedy selection process for brownfields sites should be site-
specific and risk-based--as it should be for all Superfund sites.
Reasonably anticipated future land and water uses must be
considered in selecting the appropriate remedy.
Liability protection should be given to owners and sellers of
property, as well as to purchasers.
A brownfields program should be broadly applied. The location of
the site and redevelopment potential should determine brownfields
applicability, not statutory jurisdiction. API believes that sites on
the NPL and those proposed for listing, along with sites subject to
corrective action or a planned removal under the Resource Conservation
and Recovery Act (RCRA) should be eligible for brownfields programs.
Money to fund brownfields programs should come from general
revenues and should include EPA as well as HUD appropriations.
Comprehensive Reform
API's position has been, and remains, that the current Superfund
program should undergo comprehensive legislative reform, should sunset
at the completion of cleanups of the CERCLA sites currently on the NPL,
and should be paid for with general revenues. In addition to the
liability scheme, other issues that the reform legislation should
address are: remedy selection, natural resource damage assessments, no
carve outs for any special interest s that have contributed waste to a
site, and the possible transfer of the administration of cleanup
programs to the States.
Remedy Selection Reform
API members continue to support remediation standards that are
site-specific and risk-based. We support provisions that would
establish requirements for facility-specific risk evaluations to
determine the need for remedial actions and to evaluate the
protectiveness of remedial actions. The remediation process should
provide protection of human health and the environment through methods
that are practical and achievable in a cost-effective fashion. API has
11 recommendations for reform.
They include:
--Remedy selection must be based onsite evaluation and scientific
risk assessment combined with site-specific risk management decisions
and remedy selection criteria.
--Risks must be prioritized so that limited resources are used
efficiently.
--Benefit/cost analysis must be used to assess remedial
alternatives.
--Realistic land and water use assessment must be explicitly
considered in remedy selection.
--Groundwater remedy selection should be based on future use and
exposure.
--The preference for treatment and permanent solutions should be
eliminated.
--Provisions for use of Applicable or Relevant and Appropriate
Requirements (ARARs) should be amended.
--Technological feasibility must receive greater consideration in
assessing alternative remedial actions.
--The public should have input and receive information as part of
the decisionmaking process.
--Voluntary cleanup should be encouraged.
--Pre-enforcement judicial review should be allowed.
Natural Resource Damage Provisions
There are a number of revisions to the statute that would improve
the NRD program under CERCLA and OPA. The following principles for NRD
reform should be the core elements of such revisions:
--Refocus the program on restoring, replacing or acquiring the
equivalent of injured natural resources in order to re-establish the
services provided to the public by the measurable and ecologically
significant functions of the affected resources, and prohibit surplus
recoveries based on speculative lost-use and non-use values.
--Ensure that actions to restore or replace resources are cost-
effective and cost-reasonable.
--Clarify the existing limitations on NRD liabilities.
--Require NRD trustees to prove claims in court like any other
plaintiff.
--Require consistency between Superfund cleanup and NRD programs.
API has commented extensively on these and other aspects of the
Superfund program needing restructuring. We will continue to do so in
the appropriate forums and to work for comprehensive reform. In the
meantime, we believe that at this time the Chafee-Smith bill represents
the best chance for legislative improvement and continued funding of
the program through general revenues.
In conclusion, API appreciates the opportunity to testify in
support of the Chafee-Smith reform proposal, and we commend the
sponsors for their diligent efforts dedicated to improving the
Superfund program.
__________
Statement of the National Association of Realtors
Thank you for the opportunity to present the views of the National
Association of Realtors (NAR) on S. 1090, the Superfund Program
Completion Act. I wish to thank Chairman Chafee and Chairman Smith for
their continued and determined leadership in building bipartisan
consensus on this very important issue.
My name is Mike Ford. I own a full service residential and
commercial real estate company in Clark, New Jersey, and I have been a
real estate broker for 25 years.
It is often said--and I agree--that realtors don't sell homes, we
sell communities. The more than 730,00 members of the National
Association of Realtors, real estate professionals involved in all
aspects of the real estate industry, are concerned and active members
of our communities. We want clean air, clean water and clean soil. We
want to see properties affected by historic pollution cleaned up and
returned to the marketplace. We care about a healthy quality of life as
well as a vibrant economy, and we are willing to do our part to
maintain that important balance.
However, we also expect the same fairness, certainty and
predictability from government regulators that our customers and
business partners expect from us. In this respect, Superfund has
clearly failed.
Superfund began with the laudable goal of cleaning up hazardous
waste sites to protect human health and the environment. Progress has
been achieved, and for that the EPA deserves credit. Unfortunately,
progress has come at a high price. While serving as a mechanism for
hazardous waste cleanup, Superfund has also served as an engine for
massive litigation. Deep-pocket parties targeted by EPA have turned
around and sued smaller parties. Many of these smaller parties--small
business owners who did nothing more than dispose of common garbage,
recyclers who tried to be environmentally conscious, and innocent
property owners who have not caused or contributed to hazardous waste
contamination--have been drawn into years of costly litigation
defending against the threat of huge cleanup liability.
As a first step, these parties should be provided with the maximum
possible degree of liability relief so that resources can be targeted
toward cleanup rather than litigation. When it comes to Superfund
cleanup, we must ensure that the real polluters pay so that hazardous
waste sites are returned to productive use as quickly as possible.
From the perspective of a taxpaying citizen, it is the right thing
to do to ensure that Superfund is administered in a fair and effective
manner. From the perspective of a businessman, it will provide the
certainty needed in order to move forward in developing sites that are
known or suspected to be contaminated.
As a second step, the Federal Government should recognize and
support the hazardous waste cleanup efforts underway at the state
level. In an effort to revitalize their urban centers, most of the
states--including my home state of New Jersey--are creatively attacking
the hazardous waste problem by providing incentives through voluntary
cleanup programs.
One common incentive provided by these programs is liability
relief. Typically, the state will provide some form of liability relief
once it has approved a cleanup. In New Jersey, relief comes in the form
of a ``No Further Action'' letter from the state DEP. Unfortunately,
there is no guarantee that the Federal EPA will not assert authority at
a future date and require additional cleanup. Without the certainty of
knowing that they are protected from Federal as well as from state
liability, property owners and developers are very reluctant to
undertake development of a site which is or might be contaminated.
In New Jersey, we have our fair share of hazardous waste sites.
However, I've seen what can be accomplished when local, state and
Federal Government work together with private business interests to
make something out of nothing. In my home town of Clark, General Motors
cleaned up a contaminated property and funded construction of a golf
course. The local government runs the course and makes a healthy
profit.
If these reforms are achieved, hazardous waste sites throughout the
country will be returned to productive use, revitalizing communities by
increasing the tax base, creating jobs, and rejuvenating neighborhoods.
Otherwise they will remain barren, contributing to nothing but economic
ruin.
S. 1090 presents a ``win-win'' opportunity for everyone by
achieving cleanup of hazardous waste sites, encouraging property reuse
and enhancing community growth. Now is the time for Congress to assert
bipartisan leadership and reinforce our nationwide effort to turn
``brownfields'' into ``greenfields.'' The NATIONAL ASSOCIATION OF
REALTORS supports S. 1090, and we encourage the 106th Congress to act
now on Superfund reform.
Thank you again for the opportunity to present the views of the
National Association of Realtors. I am happy to answer any questions.
__________
Statement of the Association of Battery Recyclers
Mr. Chairman and members of the committee, we thank you for the
opportunity to submit this statement on behalf of the Association of
Battery Recyclers, Inc. (``ABR''). The ABR represents the interests of
the lead recycling industry. This statement addresses the ``recycling
exemption'' contained in S. 1090 and sets forth several issues of
concern to the ABR regarding the application of the exemption to lead
bearing materials.
The ABR has previously raised concerns about the need for, and the
scope of, a recycling exemption. These concerns have been limited to
the issues associated with the recycling of lead bearing materials, and
in particular, lead acid batteries. The lead industry consistently has
achieved recycling rates of more than 90 percent for many years, an
achievement far beyond that attained for any other recyclable material.
This result has been achieved without the imposition of any ``recycling
exemption'' from Superfund liability. Nonetheless, this exemption has
been advocated by others based (in part) on the need to encourage
recycling activities. Moreover, the exemption provides relief only for
a limited number of parties, and does not apply to the owners and
operators of the facilities that actually conduct the recycling
activities. Thus, the ABR continues to question the need for and the
limited scope of the exemption.
Notwithstanding these concerns, the ABR has participated in the
legislative dialog over the last several years in an effort to reach a
compromise with those parties advocating the exemption. The ABR
recognizes that much effort has been expended in constructing the
exemption. Thus, the ABR will limit its comments in this statement to
certain specific issues of concern to the lead recycling industry in
the hope that the exemption will be modified to reflect the interests
of all parties involved in the lead recycling chain.
First, if the exemption is to be fair and meaningful, it must
include all parties involved in the recycling chain. Specifically, the
exemption should extend to secondary lead smelters that reclaim lead-
bearing materials. The smelters are the critical component to the
successful recycling rates achieved by the lead industry.
Second, the definition of the term ``recyclable material'' omits
any mention of battery parts, various lead-bearing battery materials
(powders, sludges, crosses, etc.) or lead-bearing materials from other
industries (e.g., chemical industry, electronics industry). As a
result, facilities handling such materials implicitly are not exempted
from Superfund liability by the bill.
Third, since the exemption is retroactive, the bill would reward
recalcitrant potentially responsible parties (``PRPs''), and would
penalize PRPs who have voluntarily cooperated with the government in
site cleanup efforts. The exemption should be made prospective from the
date of enactment of the bill or it should contain ``transition''
language that avoids rewarding recalcitrant PRPs. Specifically, Section
301(b)(2)(B) should be amended to preclude application of the exemption
to pending administrative and enforcement actions, in addition to
pending judicial actions. No relief should be afforded to a party that
prior to enactment of S. 1090 has received but not complied with an
enforcement order issued pursuant to Section 106.
Finally, Section 303 of the bill would allow parties otherwise
liable but for the recycling exemption to collect attorneys fees, and
other litigation costs, from PRPs who seek contribution, even if the
PRPs have a good faith believe that the other parties do not qualify
for the exemption. This provision will discourage PRPs from initiating
cleanups, since they will be penalized for seeking contribution from
other similarly situated parties for their response costs. Hence,
Section 303 should be modified to provide that litigation fees and
costs should only be imposed where it can clearly be demonstrated that
there was no basis to file a contribution action.
On behalf of the Association of Battery Recyclers, Inc., we
appreciate the opportunity to submit these comments. We commend you and
the other committee members in their efforts to amend Superfund in a
manner that is more workable and fair to all affected parties.
__________
Hazardous Waste Action Coalition,
June 4, 1999.
The Honorable John H. Chafee, Chairman,
Senate Environment and Public Works Committee
Dirksen Senate Office Building
Washington, DC 20510
Dear Chairman Chafee and Chairman Smith: On behalf of the Hazardous
Waste Action Coalition (HWAC), the association of leading engineering
and science firms practicing in multimedia environmental management and
remediation, I respectfully request that the attached letter be made
part of the hearing record for the May 25 hearing on S.1090, the
Superfund Program Completion Act of 1999. If you have any questions, or
if you need additional copies of the attached letter or a disc
containing the letter, feel free to contact HWAC staffer Carolyn Kiely
at 202-682-4354.
Sincerely,
Daniel E. Kennedy, President.
______
Statement of the Hazardous Waste Action Coalition
As you know, the Hazardous Waste Action Coalition (HWAC) is the
leading trade association representing engineering and science firms
practicing in multimedia environmental management and remediation. HWAC
member firms are at the forefront of implementing the nation's
Superfund law for the governmental and private sectors. HWAC has been a
strong supporter of your efforts to comprehensively reform the Federal
Superfund statute over the past several years.
HWAC is disappointed that this year's Superfund Program Completion
Act of 1999 (S. 1090) addresses only limited aspects of the Superfund
program, while leaving intact the most important element of the
program, the actual methodology for hazardous waste cleanup. Tinkering
with some aspects of the ``who pays'' component of Superfund, while
winding down funding to conduct and oversee cleanups, and at the same
time leaving the present cleanup system unchanged, will perpetuate many
of the present complaints about the slow pace and high cost of cleanup.
In addition, not reforming the liability traps that snare response
action contractors when they try to be efficient and innovative in
cleaning up problems is a shortcoming that actually harms all
stakeholders.
HWAC strongly encourages you to promote the comprehensive changes
advanced in S.8, which you cosponsored in the last Congress. S.8
established bold reforms that would truly move the Superfund program
forward. The major beneficiaries of S.8's reforms would be the American
public, who would receive more prompt, cost-effective cleanups that
truly protect public health and the environment.
As the implementers of hazardous waste cleanups, we see on a day-
to-day basis what in the present law isn't working from a practical,
implementation viewpoint. HWAC truly believes that the only way to
improve the workings of the present law is through comprehensive reform
that touches all aspects of the program. The current law is in need of
significant changes in remedy selection and cleanup methodologies, as
well as reform of the liability and funding provisions. Changing the
remedy selection portion of Superfund is where the American public will
receive the largest benefit from legislative Superfund reauthorization
efforts. Presently, those parties who are undertaking responsible
cleanup activities are often unable to take advantage of today's
innovative technologies which would ultimately lead to more efficient
and cost-effective cleanup of hazardous waste sites.
We wish to work cooperatively with your office to address our
concerns, with the hope that we would then be able to support your
efforts to pass comprehensive Superfund legislation this year. HWAC
stands ready to work with you as needed to debate the changes which are
vital to improving the overall cleanup process and result in cheaper,
faster, more cost-effective cleanups that will benefit the American
public. Feel free to contact me at 202-828-7368 to discuss our views on
Superfund implementation at your convenience.
__________
Statement of the Nuclear Energy Institute
Mr. Chairman and members of the subcommittee, my name is Joe
Colvin. I am president and chief executive officer of the Nuclear
Energy Institute. The Institute sets policy for the U.S. nuclear energy
industry and represents more than 275 members with a broad spectrum of
interests, including every U.S. utility that operates a nuclear power
plant. NEI's members also include nuclear fuel cycle companies,
suppliers, engineering and consulting firms, national research
laboratories, manufacturers of radiopharmaceuticals, universities,
labor unions and law firms.
The Institute is pleased that the Subcommittee is re-authorizing
the Comprehensive Environmental Response, Compensation, and Liability
Act of 1980 (CERCLA) and commends Chairman Smith, Ranking Member
Lautenberg and subcommittee members for undertaking the reform and
affording the industry an opportunity to comment for the record.
In reauthorizing CERCLA, this subcommittee has an opportunity to
make reforms to the law that would greatly improve Federal oversight by
directing effective use of Federal agency authority, expertise and
resources. In doing so, this subcommittee would eliminate duplicative
and inconsistent regulatory policies that arise during the license
termination and cleanup of sites licensed by the Nuclear Regulatory
Commission through its authority under the Atomic Energy Act of 1954.
Those sites include medical institutions, universities with research
programs, radiopharmaceutical companies and nuclear power plants.
Such action will align the National Priorities List--the Superfund
program--with President Clinton's Executive Order No. 12866 \1\ to
implement ``a regulatory system that protects and improves [the
American people's] health, safety, environment and well-being and
improves the performance of the economy without imposing unacceptable
or unreasonable costs on society.''
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\1\ Executive Order 12866 of September 30, 1993, ``Regulatory
Planning and Review,'' published in the Federal Register, Vol. 58 No.
190, pp. 51735-51744, dated Monday, October 4, 1993.
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In its current form, CERCLA sets the stage for conflicting and
overlapping authority between the NRC and Environmental Protection
Agency that prohibits the remediation of NRC-licensed sites in a safe,
timely, and cost-effective manner. The conflict stems from the fact
that the Atomic Energy Act gives the NRC responsibility to regulate
civilian use of nuclear materials. Under its authority, the NRC has
overseen the successful remediation of more than 70 sites to a level
that fully protects public health and safety. By comparison, CERCLA
assigns the EPA primary responsibility to administer the remediation of
contaminated sites included on the Superfund list.
This subcommittee can eliminate the statutory confusion created in
CERCLA by reaffirming the NRC's authority under the Atomic Energy Act
of 1954 to oversee license termination and site remediation of NRC
licensees. This clarification would ensure that Federal resources are
used efficiently and effectively. More importantly, amending the CERCLA
language will continue to ensure full protection of public health and
safety.
Background
In 1992, the EPA agreed to defer remediation of NRC-licensed sites
to the nuclear regulator. That interagency accord was consistent with
NRC's mission under the Atomic Energy Act of 1954, to act as the sole
regulator and standard-setter of certain radioactive materials. Drawing
on that accord, the NRC used its policy and guidelines to successfully
regulate the site remediation and license termination on a case-by-case
basis of more than 70 sites.
In 1997, the NRC formalized its approach by issuing a final rule
that included a generic environmental impact statement. In addition to
providing a clear regulatory approach, the final rule articulated
specific radiation safety standards for remediation and license
termination. The NRC stated that ``the final rule will result in more
efficient and consistent licensing actions related to the numerous and
complex site decommissioning activities anticipated in the future.''
The NRC adopted this rule after 4 years of extensive scientific
study and public comment, during which NRC held more than a dozen major
workshops and meetings on residual radiation standards and provided
three separate noticed requests for public comments. This broad level
of public-participation produced more than 7,000 comments from a wide
range of interests--including scientific and professional
organizations--EPA and other Federal agencies, state and local
governments; Native Americans, NRC licensees, academic bodies, and
civic and environmental organizations. The EPA actively participated in
this process and was consulted by NRC throughout the rulemaking effort.
NRC's 4-year rulemaking process and related scientific studies led
the agency to conclude that public health and safety is best protected
by a regulation that sets a maximum limit on potential exposure to
members of the public from residual radiation at remediated sites from
all possible ``dose pathways,'' such as air, soil, surface and ground
water, and food products grown at the remediated site. The regulation
also requires that a site-specific, cost-benefit analysis be performed
by the licensee to identify actions to be taken to further remediate
the site and reduce potential levels of exposure below the maximum
limit.
The approach taken by NRC including a maximum radiation dose limit
and a requirement to further reduce potential exposure to levels that
are-''as low as reasonably achievable,'' incorporates the
recommendations of respected national and international scientific
organizations \2\ and is consistent with regulatory standards adopted
in other countries. However, this approach differs from that taken
previously by the EPA. The EPA approach included a maximum radiation
dose limit, but does not include a requirement to further reduce
exposure levels. EPA also supports a separate groundwater requirement
that utilizes the maximum contaminant levels (MCLs) established by EPA
under the Safe Drinking Water Act (SDWA).
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\2\ Such organizations include the National Council on Radiation
Protection and Measurements, the International Commission on
Radiological Protection, and the International Atomic Energy Agency.
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Based primarily on the lack of a separate radiation standard for
groundwater in the NRC rule, EPA Administrator Carol Browner in 1997
informed NRC Chairman Shirley Jackson that EPA ``would be forced to
reconsider its policy of exempting NRC sites'' unless EPA's approach
was incorporated into NRC's final rule. \3\
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\3\ Letter from EPA Administrator Carol M. Browner to NRC Chairman
Shirley Ann Jackson, Feb. 7, 1997.
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Shortly before that correspondence, EPA pursued its rule for site
cleanup standards that would have been generally applicable to all
Federal agencies, including the NRC. However, the EPA rule was rejected
during an interagency review process, involving primarily EPA, NRC and
the Energy Department, facilitated by the Office of Management and
Budget. The EPA formally withdrew its proposed rulemaking in December
1996.
After substantial interaction with EPA--and despite continuing
disagreement between the agencies on the regulatory approach to site
remediation--the NRC issued its final rule in July 1997. NRC's rule has
been applied to license termination decisions for its licensees.
Nonetheless, the EPA has continued to challenge NRC's regulatory
program. In August 1997, the EPA issued a guidance memorandum to its
regional offices that rejects the general acceptance of NRC's criteria
under CERCLA, although the memorandum notes: ``We expect that NRC's
implementation of the [NRC] rule for license termination will result in
cleanups within the Superfund risk range at the vast majority of NRC
sites.'' \4\ EPA also has interacted with public interest groups and
the media on the decommissioning of NRC-licensed facilities, expressing
concerns about the NRC standard and regulatory approach. Most recently,
the EPA has formally criticized NRC's regulatory process as part of an
NRC licensing review and has requested technical information from an
NRC licensee regarding its site remediation plans.
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\4\ Establishment of Cleanup Levels for CERCLA Sites with
Radioactive Contamination, Aug. 22, 1997, OSWER No. 9200.4-18.
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Through its duplicative actions, the EPA is diverting attention
away from the NRC's clear, consistent site cleanup standards to protect
public health and safety. Rather, the focus has shifted to EPA's
refusal to accept NRC's decommissioning standards for remediated sites.
In the case of nuclear power plants, NRC regulations require plant
licensees to collectively accrue $45 billion in funds to decommission
these sites. It would be financially imprudent for these licensees to
spend accrued funds to pursue cleanup under a threat of being revisited
by another Federal agency on the same issues.
Such EPA interactions have taken place despite congressional
direction that the NRC site remediation rule fully protect public
health and safety: ``It has come to the [Appropriations] Committee's
attention that the [EPA] has recently proposed the reversal of its
long-standing policy of deferring to the . . . NRC for cleanup of NRC-
licensed sites. In the past, EPA has not placed sites which have been
successfully remediated under the NRC on the National Priority List.
The Committee is satisfied that the NRC has and will continue to
remediate sites to a level that fully protects public health and
safety, and believes that reversing this policy is unwarranted and not
a good use of public or private funds. EPA is therefore directed to
continue its long-standing policy on this matter with the NRC and spend
no funds to place NRC-remediated sites on the NPL.'' \5\
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\5\ House Rpt. 105-610: Departments of Veterans Affairs and Housing
and Urban Development and Independent Agencies Appropriations Bill for
1999 (accompanies H.R. 4194-P.L. 105-276).
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EPA's Interaction In Remediation of NRC-Licensed Sites Is Duplicative,
Inconsistent
EPA's continuing interactions in NRC's regulatory process reflect
an inconsistent and duplicative regulatory approach and demonstrate a
threat to list remediated sites on the National Priorities List even
after a NRC has terminated a license and relinquished jurisdiction.
To that end, EPA's intervention has raised serious stakeholder
concerns regarding the authority and finality of NRC licensing
decisions; the potential of parties associated with affected sites for
future liability; and the looming uncertainty regarding a site
remediation's ultimate duration and costs. More importantly, EPA's
involvement erodes stakeholder confidence in the integrity of Federal
regulatory review and oversight, which runs counter to the objectives
of the administration for ``reforming and making more efficient the
regulatory process.''
For the reasons stated above, the industry respectfully recommends
that the subcommittee consider including the enclosed amendment in
legislation to reauthorize the Superfund program. We note that the
proposed amendments are drawn from NRC recommendations for legislative
changes recently submitted to the Vice President. \6\
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\6\ Letter from NRC Chairman Shirley Ann Jackson to Vice President
Albert Gore, Jr., as President of the U.S. Senate, dated May 13, 1999.
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The Nuclear Energy Institute appreciates the opportunity to provide
the industry's perspective on this important issue.
ATTACHMENT
suggested amendments to the comprehensive environmental response,
compensation and liability act of 1980
The Comprehensive Environmental Response, Compensation and
Liability Act of 1980 (42 U.S.C. 9601 et seq.) is amended--(1) by
adding the following new paragraph at the end of section 121(b):
``(3) No authority of this Act may be used to commence an
administrative or judicial action with respect to source, special
nuclear, or byproduct material that is subject to the decontamination
regulations issued by the Nuclear Regulatory Commission for license
termination under the Atomic Energy Act of 1954, or by a State that has
entered into an agreement pursuant to section 274.b. of that Act,
unless such action is requested by the Nuclear Regulatory Commission
or, in the case of such material under the Jurisdiction of a State that
has entered into an agreement pursuant to section 274.b. of that Act,
the Governor of the State.'' (2) by inserting the following before the
period at the end of paragraph (K) of section 101 (10):
``, or any release of such material in accordance with regulations
of the Nuclear Regulatory Commission following termination of a
license issued by the Nuclear Regulatory Commission pursuant to the
Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.) or by a State
acting under an Agreement entered into pursuant to section 274.b.
of that Act.''