Developing Allocations
        Among Potentially Responsible
             Parties for the Costs
          of Superfund Site Cleanups
                Prepared by
   Office of Site Remediation Enforcement
    U.S. Environmental Protection Agency

Superfund Administrative Improvements Project
                October 1994

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                               Table of Contents:






I.     Executive Summary	1






II.    Introduction	 1






III.   Methodology	 2






IV.   Developing Allocations	2




      A. Procedural Rules	 .	 . 3




      B. Information Collection and Data Compilation	4




      C. Application of Allocation Factors  	6




      D. Allocations between Classes of Parties .  . .	7




      E. Federal, State, and Municipal Parties	 8




      F. Ability to Pay Determinations .	. . . .	9




      G. Parent and Successor Corporation Issues	9






V.    Allocator Expertise		  10






VI.   Time and Expense Considerations	'.,...	10






VII.   Purpose and Use of this Document	11

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                Developing Allocations Among Potentially Responsible
                  Parties for the Costs of Superfund Site Cleanups
I.  EXECUTIVE SUMMARY

      The Office of Site Remediation Enforcement contacted nine entities experienced
in administering, or participating in the allocation process to collect information
regarding allocation methods used to apportion Superfund site costs under the
Comprehensive Environmental Response, Compensation, and Liability Act. The
information gathered serves to assist EPA and the parties paying these costs in
examining settlement options that are fair and minimize transaction costs at Superfund
sites.  This report reflects the information that gathered from the persons interviewed,
and does not reflect the views of the EPA.   The following highlights represent the
primary findings of this research:

o     It is important that the allocation process is flexible to accommodate the site-
      specific circumstances, and assist with the ultimate goal of reaching settlement
      and  reducing transaction costs;

o     The factors selected  .to apportion costs in any allocation are a function of site
      type, amount of information available, and the classes of parties participating in
      the allocation;

o     The most critical factors in selecting an allocator for a successful allocation are
      the neutrality of the  allocator and the PRPs' perception of fairness in the process.

II. INTRODUCTION

      The Comprehensive  Environmental Response, Compensation, and Liability Act
(CERCLA) is often criticized for the high transaction costs that are incurred by
potentially  responsible parties (PRPs)1 in reaching settlements for Superfund site
cleanup and in litigating where settlement efforts are unsuccessful.  Many believe that
much of these transaction costs arise as a result of a retroactive, strict, joint and several
liability scheme.  One way PRPs may facilitate settlement at the site and reduce
transaction costs is through the use of an allocator to apportion cleanup costs among
PRPs at the site.
    1  Section 107(a) of CERCLA defines four classes of parties who may be liable for the
cleanup costs at Superfund sites: 1) present owners and operators of a site; 2) past owners
and operators of a site; 3) parties which arrange for the disposal, treatment, or storage of
the hazardous substance (generators); and 4) parties which transported the substances to
the site (transporters).  These parties may be pursued  by the government under  sections
104, 106 and 107 of CERCLA and/or by private parties.

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       In April 1993, the EPA launched an effort to explore options by which the Agency
could implement Superfund in a more fair and efficient manner.  One of the initiatives
that EPA identified focuses on the use of allocation tools as a way to address fairness
concerns and reduce transaction costs in the enforcement of Superfund. As part of this
initiative, the Agency committed to conducting information-gathering activities on
allocation issues and distributing this information to the regulated community to further
facilitate settlements. This report fulfills that commitment by providing information
received in interviews on allocation practices from the perspective of both allocators and
PRPs participating in allocations.

III. METHODOLOGY

       The Office of Site Remediation Enforcement (OSRE) contacted  three
organizations experienced in leading and developing allocations (allocators), five firms
experienced in representing PRPs in CERCLA settlements, three of which function as
allocators when not representing parties at sites, and one in-house counsel, to discuss
their allocation experiences. The nine parties  interviewed are located in, and represent
parties from, geographically diverse areas  of the country. These interviews were
conducted in order to identify allocation methods currently used to  allocate costs at sites,
and identify issues associated with the implementation of allocation processes.  The
information in this report is limited to the extent that the number of interviewees is
limited.

IV. DEVELOPING ALLOCATIONS

       The process by which PRPs organize to apportion site remediation costs with the
goal of settling among themselves and collectively with the U.S., is commonly referred to
as an allocation. PRPs often coalesce to allocate cost shares so that they may  resolve
potential liability with the United States, through negotiations with the EPA, to minimize
transaction costs that might otherwise be associated with PRP settlement negotiations
and litigation. To facilitate these processes (i.e., allocation and settlement), coalescing
parties usually set up an allocation committee.  The allocation committee may be
responsible for developing a method to fairly allocate site costs among the parties and
recommending a final allocation to an executive committee, or the group may hire a
private consultant (an allocator) who would perform all or part of these functions.  The
latter arrangement is the focus of this report.

       Once the PRPs select an allocator, the allocator's specific responsibilities are set
forth in a contract between the PRPs and the allocator. The allocator's role may vary in
scope from data collection and compilation activities to development of a cost  allocation.
Prior to beginning work, the allocator submits  to the parties a scope of work for the
project, including specific  tasks and corresponding cost estimates. The scope of work
assures the allocator that participants agree up front on the process used for allocation
and provides the participants with necessary control over the allocator's  activities and
charges.  The scope of work continues to operate as a master plan throughout  the

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allocation process.
       Some of those interviewed cite that a primary advantage of involving an allocator
in the settlement process is the degree of confidentiality afforded contribution
information and confidential business information.  Participants are more forthcoming
with information to an allocator with whom they have entered a confidentiality
agreement than they are to an allocation steering committee with whom there is
generally no such agreement.

       Others  interviewed report that, in some instances, especially for sites with few
parties and relatively good contribution information, it is more appropriate for an
internal committee, rather than an outside party, to make cost allocation determinations.
In these  cases, an intermediary adds an unnecessary layer and cost to the allocation
process;  however, many interviewees observe that it is often necessary to hire an
allocator for compilation of the database and to resolve intra-PRP group disputes.

       Whether or not a PRP group hires an outside consultant, there are several well-
recognized phases of an allocation:   1) development of procedures to govern the
allocation (this step includes approval of the allocator's scope of work, where
appropriate); 2) information identification and collection; 3)  database development
including resolution of participant disputes and corrections to the database; 4) submittal
of advocacy briefs from PRPs to the allocator and the allocator's review of available
information; 5) issuance of draft allocation report; 6) challenges to the allocation; 7)
issuance  of a final allocation report; and 8) facilitation of a settlement.   (See attachment
for an  overview of the process).  When ari allocator is hired by the PRP group, the
allocator is primarily responsible for developing an allocation of cost, with support from
technical and legal support where necessary.

       A. Procedural Rules

       It is usually during the  first phase of the process that the participants develop
rules and procedures regarding, for example, ex parte communications, dispute
resolutions, and appeals.  The allocator may assist in developing a balanced process that
ensures both goals of fairness  and of reaching an expeditious settlement.  Some       '
allocators caution against too  much process; they report that the more the allocation
process resembles a mini-trial, the higher the transaction costs. Some interviewees
argued that procedures such as rights of cross-examination and the use of document
production and interrogatory-like requests add substantially to transaction costs but do
not significantly change the bottom-line allocation results/figures.

       Some of those interviewed noted that confidentiality of information is an issue
which needs to be resolved early in the process, and noted that parties usually enter into
extensive confidentiality agreements.  Parties may agree to keep information confidential

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among the participants or with the allocator, where appropriate.  These agreement help
to ensure that if a party shares information that waste was sent to a particular site other
than the site for which an allocation is being conducted, that information may not be
used in future dealings with EPA or other parties. By identifying the ground rules as
early in the process as possible, the likelihood of law suits resulting from inappropriate
disclosures is minimized.  This is particularly important to prevent parties from
discontinuing participation and attempting to settle with EPA using information gathered
from other allocation participants.       Opening statements provide an opportunity for
parties to propose that certain facts and allocation factors be given consideration.
Parties do not generally agree at the outset as to what factors the allocator should apply
to apportion site costs. The allocator decides what factors are most relevant and
documents these decisions and additional assumptions in the allocation report.  Once a
draft allocation report is issued, the parties have the opportunity  to comment on factors
used to allocate costs. Essentially, a dialogue takes place between parties and the
allocator until a final allocation report is issued.  At this point the parties may choose to
accept the report as issued, or use it as a basis  for negotiation, in order to reach
settlement.

      B.  Information Collection and Data Compilation

      Once the parties agree upon procedures to govern the allocation, the information
collection can officially begin.  In some cases that means continuing where earlier
information gathering efforts ceased.  Information-gathering activities vary depending on
the site type and classification of parties.  Sources typically used for waste contribution
information include: responses to EPA's CERCLA section 104(e) information requests;
disposal records; site records; interviews; and questionnaires.

      The majority of those interviewed report that section 104(e) information is easily
obtained as a result of EPA's recent information-sharing policy;   however, one
interviewee noted  that 104(e) information was available only half of the time needed.
The latter interviewee proposed that a more diligent use of 104(e) requests by EPA,
including  collection of penalties by EPA for noncompliance, would result in better data
and ultimately, more accurate cost allocations.  Availability of 104(ej  data becomes
particularly relevant for cases in which parties identified by EPA as PRPs at the site do
not participate in the allocation process. EPA's 104(e) requests may provide information
to the allocator regarding volume of waste contributed by those parties not participating
in the allocation.

      Even though PRP responses to EPA 104(e) requests are readily available in most
cases, allocators are frequently asked to draft and administer questionnaires.
Questionnaires typically include questions regarding the waste-generation process,
disposal methods,  and waste haulers used, to provide  the allocator with additional
information on waste contributions and leads on transporters and pathways of
contamination. Generally, employee statements relied upon for corporate information
are required to be notarized, and corporate officer certification is required for
verification  that corporate records have been searched with diligence.  One allocator

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observed that participant responses to allocator information requests are often more
thorough than responses to EPA's 104(e) requests because of PRP-allocator
confidentiality agreements.

       Information gathering in the case of a generator landfill allocation initially focuses
on obtaining available volumetric information or information which may be used to
generate surrogate volumetric information.  For periods in which volumetric information
is absent, data is often extrapolated from existing waste production and disposal records
for a given period  to determine waste contribution for a non-recorded period.  The
yearly  amount of waste produced and the number of years of operation are two  factors
frequently used during extrapolation in order to better calculate volumetric contributions
absent records.  Another example of how extrapolation is used is the case in which a
party utilizes four  recycling facilities for disposal annually.  In the absence of other
information, the allocator may, for example, use the assumption that the recycling facility
at issue accepted one-fourth of the facility's waste during the annual period.

       In addition, some allocators rely upon waste output models of a party's production
facility for cases in which waste-disposal information is absent.  For example, if a facility
manufactures 50 units in a given year and a corresponding byproduct of 2 gallons of
hazardous materials, then, in the absence of other information, the allocator may assume
the generation of 2 gallons of byproduct in a recordless year provided  that manufacturing
remains at 50 units.  One interviewee objected to waste output models because models
may inaccurately portray production during that period, or even worse, they may unjustly
penalize a company for keeping detailed production or disposal records during other
time periods. A model could attribute the generation of waste to a PRP in excess of the
amount actually produce based on records.

       In an effort to fill data gaps, economic issues are also considered in developing
disposal assumptions.  For example, an allocator may rely upon the assumption that the
transporter hired by the generator used the disposal facility which was  most cost effective
for the transporter.

       If volumetric contribution information is collected, the allocator develops a
database to  house the information.  Many of those interviewed first classify parties by
waste type disposed (e.g., solids verses liquids). Once waste type categories are
developed, the allocator then ranks parties by volume of waste disposed.  Some
interviewees stressed  that consistency of judgment throughout development of the
database is critical in developing an accurate allocation; therefore, the  fewer people
directly involved in making interpretations, applying assumptions, and inputting data, the
more reliable the data. PRPs are generally provided an opportunity to provide a quality
control review of the  database for clerical and technical errors.  That review may result
in challenges to  data input, such as recording of duplicate transactions  and purported
misinterpretations of data.

       For sites  at which contamination is due to  the historic operation of a
manufacturing facility or facilities (non-landfill sites) or landfill sites at which the only

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PRPs are owners or operators, though the basic information collection process is similar,
interviewees reported that a substantially different approach must be taken in developing
and organizing a database.  The ranking of parties in these situations is dependent upon
site specific circumstances and generally does not lend to ranking parties in a purely
quantitative manner. In contrast to many landfill sites where volumetric data is  available
from disposal records, at non-landfill sites disposal data is not available since any
disposal was generally a consequence of a manufacturing process which included
undocumented discharges and inadvertent spills of hazardous substances.  Therefore,
surrogate data may be generated by an evaluation of: 1) typical manufacturing process
discharges and spills; 2) production line practices; and 3) the environmental fate of
contaminants.

       Finally, those interviewed report that for sites at which an allocation is between
PRPs which are owners and operators, information should be obtained regarding the
practices and knowledge of the parties in order to determine relative responsibility.
Information sought typically includes length of  ownership, operational control, degree of
control over disposal practices, knowledge of the hazardous nature of materials disposed,
and financial or other benefit derived from allowing disposal.  Once data is collected, the
process of allocating cost shares may begin.

       C. Application of Allocation Factors

       The Gore Amendment2, an unadopted amendment proposed to the original
Superfund bill, contains the  following factors to be considered when allocating site costs
among PRPs:  (1) the amount of hazardous substances involved; (2) the degree of toxicity
or hazard of the materials involved; (3) the  degree of involvement by parties  in the
generation, transportation, treatment, storage, or disposal of the substances; (4) the
degree of care exercised by the parties with respect to the substances involved; and (5)
the degree of cooperation of the parties with government officials to prevent  any harm to
public health or the environment.

       Since proposed, the Gore factors have been applied as relevant  factors, in whole
or in part, by allocators in private allocations and by courts in contribution actions.3  In
both contexts, a variety of additional factors have been applied depending on site
circumstances and at the discretion of the judge or allocator.  Those factors include: 1)
years of ownership or operation/years of generation or transportation/years of
manufacturing process; 2) consideration of the petroleum exclusion; 3) the ultimate
    2  See H.R. Rep. No. 99-253 (III), 99th Cong., 1st Sess. 19 (1985). reprinted in 1986 U.S.
Code Cong. & Admin. News 3042.


    3 See "Allocating Contribution Shares in Superfund Cases," Chemical Waste Litigation
Reporter; "Allocation of Response Costs in Private Superfund Actions," Chemical Waste
Litigation Reporter, Vol. 17, No., December 1988.

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environmental fate of wastes at the site; 4) the degree of care exercised in waste disposal
or ownership and operation; 5) the degree of control over waste practices; 6) permit
violations; 7) the degree to which a party is providing a public service; and 8) knowledge
of waste disposal practices. One allocator reported using the degree of party
cooperation as a factor since allocations only work in situations  with cooperating PRPs.

       Because the goal of the allocation process is settlement, all interviewees
recommend that application of allocation factors should be flexible to accommodate site-
specific situations and to increase the likelihood of settlement.  None of the  allocators
interviewed rely on specific formulas or models to allocate cost  shares.  They all
emphasized that factors applied are a function of site type, amount of information
available, and classes of parties involved in

the allocation. Generally, in generator/transporter allocations, the allocator primarily
considers volume and contaminant fate in allocating cost  shares. Some interviewees
believe that the  use of volumetric information alone is inappropriate to develop a cost
allocation. In owner/operator allocations, the allocator's focus shifts to factors such as
degree of care in, and years of, ownership and operation.

       Of the  allocation factors identified, those interviewed  identified toxicity of waste
as the factor generating the most controversy in its application.  Interviewees reported
that claims of toxicity often result in much time spent name-calling and little time
addressing contribution. Although many of those interviewed indicate that the toxicity of
waste contributed is considered as a factor in a generator/transporter allocation, most
parties believe that toxicity alone is not an appropriate modifier because it is a poor
measure of site responsibility.  More specifically, for allocations at landfill sites involving
primarily generators,  for example, the degree of toxicity of a party's waste is  used to
manipulate the raw volumetric data by either discounting or  appreciating a party's
contribution to the site.  Interviewees report that many PRPs feel that toxicity should
only be used to  discount baseline volumetric information  already determined (i.e., more
weight is giving to more toxic waste when volumes  are relatively equal). They state that
some PRPs prefer developing a waste contribution table made up solely of volumetric
contributions,  and then providing an appeals process  for parties to argue for adjustment
of their contributions based on toxicity claims.

       Rather than considering toxicity of a waste alone, many interviewees propose that
toxicity be considered in relation to the contaminant's role in the driving the cost of the
remedy at the site. For example, if a generator disposed of a highly toxic chemical at a
site, but that contaminant was not the primary contaminant of concern being addressed
and resulting in  the high cost  of the remedy, then that party's share would not be
increased because of  its waste toxicity any more than the  parties who contributed less
toxic waste to the site.  In addition, if the toxic materials  disposed at the site are well
contained (e.g., remained immobile and capped as  part of landfill containment) and
consequently represent a discernable component of the cleanup costs, the participant
would not be responsible for a greater cost share associated with a groundwater pump
and treat system simply because of the high toxicity of the material. This application

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focuses on the ultimate role of a contaminant in site remediation, rather than the
toxicological characteristic of the waste.

       Although litigative risk is not a factor of the actual contribution findings, it may
be used to modify the ultimate settlement. Even after the allocator issues a final
recommendation, the degree to which parties are motivated to settle may still be an
issue.  For example, litigation  risk may be used as a floor to determine a minimum
payment.  If volumetric information does not exist but the party is presumed  to have
been a small volume contributor, then the minimum settlement cost for that party may
be set at the cost of litigation, and that amount may become the party's allocated share.
       D. Allocations between Classes of Parties

       None of the allocators interviewed identified specific formulas or reliance on any
particular rule of thumb to determine shares in cases in which generators/transporters
and owner/operators are both involved. Interviewees stated that allocations which
include owners and operators pose a greater challenge in achieving a reliable allocation
than generator /transporter allocations.

       Unlike generator/transporter allocations, at which volumetric information or
surrogates may be used to generate volumetric information, raw volumetric data is
inapplicable in calculations of owner/operator allocations.  Often, allocators utilize site-
specific facts  and court opinions with similar fact patterns to determine what factors are
applicable for an owner/operator allocation. Most allocators interviewed rely on some
or all of the following factors in determining owner/operator share: (1) degree of care
exercised  in ownership or operation; (2) years of ownership or operation; (3) degree of
control over waste practices; (4) permit violations; (5) degree to which party is providing
a public service; (6) knowledge of waste disposal practices; and (7) economic benefits
from ownership and operation.

       For generator/owner/operator allocations, often, the owner/operator is not part
of the  original group of coalescing parties.  Generators/transporters commonly initiate
and participate in an allocation without involving the owner/operator in order to allocate
among themselves and adjust for cost shares depending on  a determination of an orphan
share.  4 Frequently it is futile for parties to invest much time in determining an
owner/operator share because the owner/operators are often financially non-viable, and
have little money to contribute  to site cleanup. In cases where generator/transporters
    4 Depending on the allocation, there are different ways to define orphan share.  An
orphan share may be defined as contamination attributed to  defunct,  bankrupt or
financially nonviable parties. At other sites it may also be defined as contamination that
cannot be attributed to an identifiable party.

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have developed an allocation scheme absent owner/operator participation, the
generator/transporter participants may look first to financial viability of the
owner/operator. Based on an ability-to-pay analysis (discussed in more detail below) of
the owner/operator, the group often takes whatever payment the owner/operator can
make, and uses that payment to offset the total settlement amount.  In those cases, no
percentage share is assigned  to the owner/operator.

      Where a generator and transporter are responsible for the same waste,
interviewees identified a couple  of ways to allocate the costs: (1) divide the cost of their
allocated share between the two parties; or (2) if there is an orphan share, assign the
costs associated with their allocated share to either the transporter or generator and
allocate the orphan share or  a portion thereof to the other party.  Facts associated with
the generators' and transporters' activities can affect the share allocated to those parties.
Some factors often considered with generator/transporter divisions are whether the
transporter had alternative disposal locations available, or by contract was required to
dispose of waste at a particular  location, and the respective parties' culpability and
general practices.

      E. Federal. State and  Municipal Parties

      Most allocators indicate little difference in their experience whether dealing with
private, federal, or state parties  as PRPs.  Most interviewees indicate that allocators treat
federal and state parties similarly to other parties; however, private parties in some cases
indicate uneasiness about participating in allocations with federal parties because of
confidentiality concerns. PRPs develop very  extensive agreements to preserve
confidentiality of information shared during the allocation process; generally these
agreements are not entered into with Federal parties due to the dual role of the
government as enforcer and PRP. With the exception of confidentiality issues, the
interviewees did not identify  additional issues which arise by virtue of federal and state
participation in allocations. However, some of those interviewed identified unique issues
which arise with allocations involving municipalities.

        Some interviewees observed that for cases in which PRPs perceive that EPA
treats municipalities differently than the other parties at the site, the allocation process
may deteriorate. Of those interviewed, some stated that not knowing the grounds upon
which the EPA may settle with a municipal party may negatively affect the allocation. In
addition, one allocator stated that when EPA contemplates settling with a municipality
for an amount lower than the amount determined in the allocation proceeding,
participants often feel slighted and the allocation effort may fail. That allocator
suggested that the development  of a cohesive municipal PRP policy by EPA would
alleviate these concerns.

      Another interviewee, stressed the  significance of differences between
municipalities and other parties  which should be  taken into consideration, on a site-
specific basis, in allocations.  The allocator observed that municipalities are not for profit
organizations; therefore, economic benefit factors generally considered in allocations
between private parties are inappropriate to use. The allocator also noted that
determination of cost shares  should be tempered by the fact that municipalities perform

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a public service. That factor should be weighed against any culpability a municipality
might have demonstrated in the disposal, transportation, ownership or operation of
hazardous waste.

      F. Ability to Pay Determinations

      Most sources indicate that, with the exception of owner/operator contribution
determinations, ability-to-pay issues are not considered until the allocation
recommendation is completed.  At that time, inability-to-pay claims are presented, and
where proven, the  discounted amount is redistributed among the remaining parties.  In
some cases allocators may also  be involved in structured settlements for parties with
limited ability to pay (i.e., development of a payment schedule).

      Determinations of ability to pay are reported as most difficult among
municipalities.  When allocator's assess a municipality's financial viability, they must
consider issues not relevant to assessing private parties' viability. Indicators of municipal
health reportedly used include the following: overall net debt as percent of full market
value of taxable property; bond rating; unemployment; median household income;
property tax collection rate; and property tax revenues as a percent of full market value
of taxable property.  For assisting in assessment of municipality assets, one  source
recommends the article, "Assessing  a Municipality's Ability to Pay Superfund Cleanup
Costs," written by Tex Ann Reid, U.S. EPA, Region IV, and Edward M. Clark, Anthony
M. Diecidue, and Mark F. Johnson, PRC Environmental Management, Inc.
"Methodology for Analyzing a Municipality's Financial Capability," by the Economic
Analysis Division,  of EPA's Office of Policy, Planning and Evaluation (February 28,
1985) is also recommended by this person for assistence in determining municipal
financial health.

      G. Parent and Successor Corporation Issue

      Whether parent and successors of a participating PRP should be allocated a cost
share may be considered at some sites ( e.g., in the case of an impending bankruptcy
claim).  In general, parent and successor corporation issues are treated in one of two
ways. At some sites, parent/successor issues are not considered in the  allocation;
rather, the participants are responsible for seeking resolution on issues, such as whether
the parent or successor may be liable  under CERCLA, in side-bar negotiations without
the allocator's assistance or through litigation. At other sites, a successor may be
brought into  the allocation if there has already been  a finding of liability or an allocator
is asked to undertake an analysis of whether a parent company is liable or successor
liability would attach.  Some of the  interviewees expressed a reluctance to address issues
of parent and successor liability.

V. ALLOCATOR EXPERTISE

      All interviewees agreed that  the most critical factors for a successful and accurate
allocation are the neutrality of the allocator and the perception of fairness. One
allocator noted that an allocation is perceived as fair when the participants have an
opportunity to present their arguments, and they believe those arguments are taken into

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consideration and addressed rationally.  Several interviewees noted that an allocator's
neutrality and ethics are key elements to good faith participation by parties.
Interviewees all agree that full disclosure of possible conflicts of interest by the allocator
is an absolute necessity prior to commencing allocation efforts. Because of participant
desires for neutrality, PRPs often disapprove of prescribed formulas or models.
Preconceived models may indicate that an allocator is not beginning the process with a
neutral view.

      Most persons interviewed agreed that ideally allocators should possess extensive
familiarity with CERCLA.  One allocator noted that a PRP  has greater confidence in the
process if a person experienced in Superfund is allocating cost shares.  That person
stated that hands-on experience can not be substituted with academic experiences.
Interviewees did not agree as to whether or not the allocator should be an attorney.
None of the interviewees expressed interest or concern for an allocator certification
program, nor felt that administrative law judges or arbitrators  are better equipped to
conduct Superfund allocations.

      Other traits considered helpful to the allocator include: excellent interpersonal
and communication skills (listening to other ideas and  reconsidering when necessary),
and problem-solving abilities.  In  addition, interviewees agreed that allocators should be
team builders, steer the allocation process,  and periodically update the PRPs on progress
of the allocation.  Allocators are also expected  to introduce  issues  needing resolution,
make recommendations as to the resolution of these issues, and ultimately keep the
process moving towards settlement.

VI. TIME AND EXPENSE CONSIDERATIONS

      The time and expenses associated with an allocation varies greatly from site to
site,  but are primarily influenced by the number of parties at  a site and the cost of
remediation. Generally, an allocation at an average site may take  six months. At some
sites, however, allocations have been completed within two months. Complicated sites
may require up to two  years for resolution,  A generally accepted range of time involved
for allocating at sites is six months to two years.

      For cases in which remediation is most costly, more time is  required to develop
an acceptable allocation. In addition, a correlation exists between  the amount of
documentation available and the amount of time invested in negotiating an allocation:
for cases in which ample information is  available, less time is required  for an allocation.
Allocations are more expensive now than they were in the 70s and 80s  in part because
volumetric information is not now as readily available.

      The expense of an allocation (e.g., costs  of retaining allocation professional
services)  depends largely on the number of parties participating or being allocated
shares. Generally, allocation costs for a small site range from $25,000 to $100,000.  The
expense for complex sites, however, may exceed $200,000, with a likely maximum of
$500,000.  For generator/transporter allocations, a significant portion of the cost is
associated with development of the database.
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      The internal expense of participating in an allocation process must also be
considered.  PRPs represented by internal counsel report that the expense of
participating in an allocation are minimized because their representative counsel are
salaried employees, costing less than counsel retained on a project-specific basis.
         »
VII.  PURPOSE AND USE OF THIS DOCUMENT

      This report reflects the  information that was gathered from persons involved with
administering or participating in an allocation process to apportion the Superfund
cleanup costs.  This report does not constitute  the views of, or policy by, the Agency and
may not be relied upon to create any specific rights or privileges, substantive or
procedural, enforceable at law or in equity.
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