.n*mnnmMinn^ sd States Office Of EPA-300-R-93-003
:PA/300/R-93/003 -onmental Protection Enforcement May 1993
icy (LE-133)
nforcement Mediation
Status Report On The Use Of
Alternative Dispute Resolution
In Environmental Protection Agency
Enforcement Actions
Calendar Yearl 992
(Last Three Quarters FY1992 and First Quarter FY1993
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U S ENVIRONMENTAL PROTECTS
AGENCY
1445 ROSS AVENUE
DALLAS, TEXAS 7520?
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REPORT
ON THE USE OF
AL TERN A T/VE DISPUTE RESOLUTION
IN ENVIRONMENTAL PROTECTION AGENCY
ENFORCEMENT ACTIONS
CALENDAR YEAR 1992
(Last Three Quarters FY 1992 and First Quarter FY 1993)
Prepared by
RESOLVE
Under Delivery Order #16
Contract #68-W1 -0014
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TABLE OF CONTENTS
Overview of EPA's Enforcement ADR Program 1
Recent Developments 2
Federal Law and Policy 2
1. Administrative Dispute Resolution Act 2
2. Department of Justice Guidance on the Use of ADR 2
National Rosters of ADR Practitioners 2
Pilot Programs in the Use of ADR 3
1. Regional Superfund Mediation Pilot Programs 3
2. Use of Arbitration in Superfund Cases 3
3. Use of ADR in Clean Water Act Cases 3
4. Use of ADR in Resource Conservation and Recovery Act 4
Financial Support for Regional Use of ADR 4
1993 ADR Training 4
Agency ADR Liaison 4
ADR Summary for All Regions 5
ADR Summary By Region 6
ADR Cases Nominated/Initiated During Calendar Year 1992 6
ADR Cases Resolved During Calendar Year 1992 7
Cases Where ADR Process Was Terminated Following Convening During Calendar
Year 1992 7
Ongoing ADR Cases as of 3//93 8
Settlement Documents With ADR Provisions 9
Selected Cases Resolved Through ADR During Calendar Year 1992 10
Selected Cases Assisted by Convening During Calendar Year 1992 11
Selected Cases In Which ADR Provisions Were Included During Calendar Year 1992 . . 11
ADR Activities Prior to 1992 12
Cases In Which ADR Was Utilized 12
Cases In Which ADR Provisions Were Included in the Settlement Document 13
Cases In Which ADR Was Nominated But Not Used 13
Explanation of Terms 15
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OVERVIEW OF EPA'S ENFORCEMENT ADR PROGRAM
The Environmental Protection Agency (EPA, or the Agency) utilizes alternative dispute
resolution (ADR) in the resolution of conflicts related to environmental enforcement actions.
It is the policy of the Agency to use ADR whenever there is a potential that it may result in a
more efficient or equitable resolution of a dispute. The Agency's "Final Guidance on Use of
Alternative Dispute Resolution Techniques in Enforcement Actions" describes ADR processes,
criteria for deciding when to submit cases to these procedures, and guidelines for obtaining the
services of qualified ADR professionals.
Responsibility for the Enforcement ADR Program was delegated to the Assistant
Administrator for Enforcement in June, 1990. The Office of Enforcement adopted an Agency-
wide "ADR Implementation Plan" in November, 1990. The Plan includes a program for
institutionalizing mediation, arbitration and similar approaches as standard operating procedures
for resolving civil actions in which the Agency is a party.
The Office of Enforcement, through the Agency's ADR Liaison, provides assistance to
staff from regional offices of the EPA and the Department of Justice (DOJ), state and local
governments, and private parties to facilitate the adoption and appropriate use of ADR to resolve
environmental enforcement actions. This assistance includes: training; technical assistance in
the review of potential cases and preparation of required procurement documents; identification
of qualified ADR practitioners; payment of government expenses related to the use of ADR for
environmental enforcement cases (particularly Superfund cases); and publication of a periodic
status report on Agency-wide ADR activities.
The Agency's use of ADR to support enforcement actions increased dramatically during
calendar year 1992, with a total of 15 cases initiated/nominated and four cases successfully
settled using mediation. The Agency is considering the use of ADR to resolve cases under a
broad range of authorities, including the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA), the Resource Conservation and Recovery Act
(RCRA) and the Clean Water Act. Moreover, dispute resolution procedures were incorporated
into three settlement documents during calendar year 1992, providing for the use of mediation
in the event that a dispute arises in the future as the settlement is implemented. Information
about these cases and settlement provisions is contained in the summary charts and descriptions
that follow.
For additional information about the EPA Enforcement ADR Program, contact David C.
Batson, ADR Liaison, at (202) 260-8173, EPA Headquarters (mail code LE-134S).
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RECENT DEVELOPMENTS IN ADR
FEDERAL LAW AND POLICY
1. Administrative Dispute Resolution Act
The Alternative Dispute Resolution Act (P.L. 101-551) (ADR Act) encourages each
federal agency and department to use ADR techniques, including mediation, conciliation and
arbitration, to resolve public conflicts over which it has jurisdiction. The statute requires each
federal agency and department to designate a "Dispute Resolution Specialist," to implement the
ADR Act's provisions within that agency or department, and provide dispute resolution training
for its staff. The statute also provides guidelines for procuring dispute resolution assistance, sets
parameters for the use of arbitration, and provides for the confidentiality of ADR procedures.
The Assistant Administrator for Enforcement is EPA's designated "Dispute Resolution
Specialist." The Agency's ADR activities are coordinated by an Agency-wide "ADR Task
Force," chaired by the "ADR Liaison" within the Office of Enforcement.
2. Department of Justice Guidance on the Use of ADR
The 1991 Executive Order on Civil Justice Reform (Executive Order No. 12778, 56 Fed.
Reg. 55, 195 October 23, 1991) directed that attorneys representing the federal government
utilize ADR to promote the prompt and proper settlement of public disputes.
To implement the Executive Order, the Justice Department issued a "Guidance on the
Use of Alternative Dispute Resolution for Litigation in the Federal Courts" in August, 1992.
The guidance document specifies that government attorneys should use ADR whenever this
practice is likely to contribute to a prompt, fair and efficient resolution of a civil action. The
guidance document also discusses ADR processes, the characteristics of cases suitable for ADR,
and procedures for the selection of neutral parties for dispute resolution.
NATIONAL ROSTERS OF ADR PRACTITIONERS
The Administrative Conference of the United States (ACUS) has established, with EPA's
support, a comprehensive nationwide roster of dispute resolution specialists, which is currently
available through a computerized database. The roster allows for identification of ADR
professionals from a list with more than five hundred neutrals, based on criteria including
substantive expertise, training, experience, and geographic location.
In addition, the Agency, through its Consensus and Dispute Resolution Services Contract
with RESOLVE, maintains a list of dispute resolution professionals throughout the U.S. that
have experience with environmental enforcement cases.
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PILOT PROGRAMS IN THE USE OF ADR
1. Regional Superfund Mediation Pilot Programs
During FY 1991, the Office of Regional Counsel in Region V completed a successful
pilot program to test the use of mediation in civil actions under the Superfund program. The
pilot included mediation of six cases, including cost recovery and remedial design/remedial
action (RD/RA) disputes. The negotiations that led to these settlements were conducted with the
assistance of neutral mediators selected and funded by all parties in the dispute, including EPA.
Settlement agreements were reached in five of the six cases. For their efforts leading to the
success of the pilot program, the Assistant Administrator for Enforcement awarded a Bronze
Medal for Commendable Service to Michael Berman, Thomas Kruger, Lynn Peterson, John
Tielsch and Carolyn Lane-Wenner of Region V's Office of Regional Counsel.
Based on the success of the Region V program, the Agency is working to expand the use
of ADR in all regions. During FY 1992, the Region I Office of Regional Counsel initiated an
extensive program to use ADR in the resolution of Superfund actions. Six cases were nominated
for ADR in Region I and settlements were reached in two cases. Other regions are considering
initiating the use of ADR and are reviewing cases to determine whether any might be appropriate
for ADR.
2. Use of Arbitration in Superfund Cases
Section 122(h)(2) of CERCLA, as amended, authorizes EPA to use arbitration to resolve
Section 107(a) cost recovery claims not exceeding $500,000. Arbitration procedures for these
claims are specified in 40 C.F.R. 304. More broadly, the ADR Act authorizes the use of
arbitration to resolve any dispute for which an agency has settlement authority.
EPA has established a pilot project to explore the potential for using arbitration to resolve
selected Superfund claims. The Agency is working with arbitration specialists to develop
procedures, in addition to those set forth in existing regulations, for commencing and conducting
arbitration proceedings. Through the pilot, the Agency also will develop criteria for the use of
this process and for the selection of arbitrators. Agency staff will attempt to use arbitration in
selected cases during FY 1993.
3. Use of ADR in Clean Water Act Cases
EPA's Office of Wastewater Enforcement and Compliance is conducting a pilot program
in the use of ADR in settlement of enforcement cases under the Clean Water Act, particularly
those that involve a penalty. Agency staff plan to initiate ADR for selected cases during FY
1993. For more information, contact Walter Broadtman, Office of Wastewater Enforcement
Compliance, at (202) 260-5998.
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4. Use of ADR in Resource Conservation and Recovery Act Cases
The Office of Waste Programs Enforcement has established a pilot program to use ADR
in settlement of cases arising under RCRA, particularly corrective action cases. This program
is planned to begin in Spring, 1993. For more information, contact Ellen Kandell, Office of
Waste Programs Enforcement, at (202) 260-9315, or David Batson at (202) 260-8173.
FINANCIAL SUPPORT FOR REGIONAL USE OF ADR
Beginning in fiscal year 1990, the Office of Enforcement has dedicated funds to provide
ADR training for EPA staff, to support regional offices considering the use of ADR, and to pay
for the services of ADR professionals in Superfund cases. The ADR Fund, which has been
extended through fiscal year 1993, is available through the ADR Liaison.
As part of the pilot programs being conducted by the Office of Waste Programs
Enforcement and the Office of Wastewater Enforcement and Compliance, funds will be dedicated
for regional offices to employ neutral ADR professionals on selected enforcement cases. Funds
for the use of ADR professionals in enforcement actions under other statutory authorities are
available on a case-by-case basis. For additional information, contact the ADR Liaison, David
Batson at (202) 260-8173.
1993 ADR TRAINING
Training programs on the use of ADR in environmental enforcement cases will be
provided to all regional offices and EPA headquarters during fiscal year 1993. The intensive
one-day training sessions are designed for all staff who support or participate in enforcement
activities. Focusing on Superfund and RCRA corrective action cases, the course will be taught
by ADR professionals with experience as mediators in EPA enforcement cases.
AGENCY ADR LIAISON
David C. Batson serves as the Agency's ADR Liaison for enforcement matters. As ADR
Liaison, he coordinates ADR case activities and provides ADR training programs for staff from
EPA, DOJ, and state agencies. Mr. Batson also serves as a mediator and facilitator in Agency
policy dialogues and intraagency disputes. He has extensive training and experience as an ADR
professional, with private and government clients in public and organizational disputes. Mr.
Batson, is available for consultation on the use of ADR generally and in specific cases. He can
be reached at (202) 260-8173, or FAX (202) 260-3069 (Mail Code LE-134S).
In addition, ADR contacts have been designated in all regional offices. An informal
group of ADR contacts meets monthly, by telephone, to discuss the use of ADR in enforcement
cases. EPA staff working on enforcement cases are welcome to participate in these meetings.
For more information, contact David Batson at (202) 260-8173.
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ADR SUMMARY FOR ALL REGIONS
This table is an overview of the information in the charts for "ADR Summary by
Region" that begin on the next page:
Calendar Total Through
Year 1992 Dec. 31. 1992
ADR cases nominated/initiated 15 45
Cases resolved using ADR 4 13
Cases in which ADR was terminated
following convening 3 22
Cases in which a neutral was consulted
about ADR, but were not nominated 17 37
Settlement documents with ADR provisions 3 13
Ongoing ADR cases as of March 1, 1993: 13 (est.)
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SELECTED CASES RESOLVED THROUGH THE USE OF ADR
DURING CALENDAR YEAR 1992
Name: Sullivan's Ledge Statute: CERCLA ADR Process: Mediation
This Superfund case involved performance of a remedy by 40 potentially responsible parties (PRPs
and coordination of future remedial activities with an ongoing cleanup which was the subject of a prior
settlement obtained through mediation. The parties to the settlement included a municipality, private parti
and the State of Massachusetts. The case involved difficult factual and equitable issues involving the State
and private parties.
Name: U.S. v. Mastex Statute: CWA ADR Process: Mediation
This case involved payment of a civil penalty by a small manufacturing company for violations of
pre-treatment standards. The mediation, held in the company's community, helped build understanding
with, and achieve cooperation from, the company. As part of the settlement, the company agreed to pay
the penalty sought by EPA and the Agency's costs of participation in the mediation.
Name: Union Scrap Statute: CERCLA ADR Process: Mediation
This was a cost recovery case involving 20 PRPs and approximately 45 third party defendants. EP
was seeking to recover over $1.4 million in past costs. When mediation was commenced, the case was
pending in federal district court and a trial date had been set. The mediation proceeded in two phases.
Initially, the mediator helped resolve claims against de minimis parties leading to a settlement with 10
parties. The mediator then was brought back into the case as the trial date was approaching and the partie
were in the final stages of discovery. The mediator assisted the remaining parties in reaching a settlement
Name: Kummer Landfill Statute: CERCLA ADR Process: Mediation
This was a cost recovery case involving PRPs including the State of Minnesota, the City of Bemidj
MN, a public hospital and several corporate PRPs. The mediation occurred within the 120 days before the
expiration of the statute of limitations for recovery of initial costs. The negotiations for recovery of past
costs were linked to and contingent on cost sharing by the PRPs of all future costs. The goal of the
mediation was to develop an agreement on cost allocation among EPA and the parties for a final settlemen
of all cleanup costs for the site. The mediator assisted the parties in reaching an agreement that included
payment of past costs by the PRPs, a plan for funding of future work by EPA, and mixed funding by EPA
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SELECTED CASES ASSISTED BY CONVENING DURING CALENDAR YEAR 1992
Name: Ottati and Goss Statute: CERCLA ADR Process: Convening
Litigation in this case was commenced in 1980 under RCRA. CERCLA claims were added after the
statute was enacted. The Court issued opinions regarding the liability of the defendants and regarding
remediation of the site in 1985 and 1988, respectively. The services of a neutral convener were employed
in mid-1992, as the parties were preparing for the third trial, scheduled for September 1992. At that time,
there was one major PRP remaining in the case, who had commenced a third party contribution action
against a number of parties including EPA. The convening process enabled EPA and DOJ to open
communications with the PRP outside of the courtroom and pursue stalled settlement discussions.
SELECTED SETTLFJvfFJVT nnriTMRNTS IN WHICH ADR PROVISIONS WERE INCLUDED
DURING CALENDAR YEAR 1992
Name: Rohm & Haas Bristol (PA) Statute: RCRA ADR Process: Mediation
The dispute resolution provision of this Section 3008(h) Administrative Order on Consent (AOC)
provides for the mediation of negotiations which might arise over the Agency's determination of future
corrective actions regarding the site. Mediation, if used, would occur after informal negotiations and
before the Agency's final determination of the dispute.
Name: In re Dynamac Corporation Statute: AHERA ADR Process: Arbitration
In this case, a large government contractor was accused of not abiding by the terms of an agreement
to remove asbestos from school buildings. The Company requested an arbitration option in the consent
agreement as protection against being disqualified from all government contracting, a remedy within EPA's
authority. Arbitration is limited to disputes which arise over remedy implementation, and if used, would
occur after informal negotiations and submission by the Company of a written statement describing the
dispute. EPA and the Company will jointly select the arbitrator. Dynamac paid a substantial fine and
agreed to review and correct the asbestos removal work in each of the schools included in the original
contract.
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EXPLANATION OF TERMS
ADR Processes
Arbitration: A process in which a neutral party considers the facts and arguments presented by
the parties to a dispute and renders a binding or non-binding decision using applicable law
and procedures.
Convening: The first step in a dispute resolution process, in which a neutral party explores with
the parties whether they are interested in using ADR, makes a recommendation about the
most appropriate way to proceed, and assists the parties in selecting a neutral.
Fact Finding: The investigation of issues by a neutral party who gathers information from all sides
and prepares a summary of key issues. (Fact finding is often used as a part of a negotiation
process.)
Mediation: The assistance of a neutral party in a negotiation process. Mediators have no power
to render a decision.
Mini-Trial: A process in which the decision-makers for each side of a dispute hear a summary of
the best case presented by the attorneys for each side. Following the presentations, the
principals engage in negotiations, often with the assistance of the neutral party.
Neutral Evaluation: An evaluation conducted by a neutral party who provides the parties to a
dispute with an assessment of the strengths and weaknesses of each party's case, and a
prediction about the potential outcome of the case.
Settlement Judge: A judge, but not the judge who would decide the case, who is appointed to
assist the parties negotiating the settlement of a case, and who may provide a prediction
about the potential outcome of the case.
Type of Case
CAA: Clean Air Act
CERCLA: Comprehensive Environmental Response, Compensation, and Liability Act
CWA: Clean Water Act
EPCRA: Emergency Planning and Community Right-to-Know Act
FIFRA: Federal Insecticide, Fungicide, and Rodenticide Act
RCRA: Resource Conservation and Recovery Act
SDWA: Safe Drinking Water Act
TSCA: Toxic Substances Control Act
Other Terms
Nom. Date: The date a case was nominated for use of ADR.
For additional information on ADR enforcement activities, contact ADR Liaison David C.
Batson at (202) 260-8173, EPA Headquarters (Mail Code LE-134S).
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