UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, O.C. 20460
OFFICE OF
ORCEUCNT)
9 , |GG= COMPLIANCE ASSURANCE
£ ZI ' ** *7 w
MEMORAJSfDUM
SUBJECT: Guidance on Agreementpwth Prospective Purchasers of
Contaminated
FROM: Steven /Lme/niftn, Assistant Administrator
Office of Enforcement and Compliance Assurance
TO: . Regional Administrators, Regions I - X
Regional Counsel, Region I - X
Waste Management Division Directors, Regions I - X •
This memorandum transmits the guidance and model agreement concerning
prospective purchasers of contaminated Superfund property. The attached guidance
supersedes the Agency policy issued in June 1989, entitled "Guidance on Landowner
Liability under Section 107(a) of CERCLA. De Minimis Settlements under Section •
122(g)(l)(B) of CERCLA, and Settlements with Prospective Purchasers of Contaminated
Property" (OSWER Directive Na 9835.9 and 54 F.R. 34235 (Aug. 18, 1989). The 1989
guidance limited the use of these covenants to situations where the Agency planned to
take an enforcement action, and where the Agency received a substantial benefit for
cleanup of the site by the purchaser, not otherwise available. In an effort to promote
cleanup for the beneficial reuse and development of these properties, EPA is expanding
the i in limit urn under which it will consider entering into prospective purchaser
agreements^.- «? *•'•
sfe. •
AddtibmaT information on this policy is available from Lori Boughton ((703) 603-
8959) or Elisabeth Freed ((703) 603-8936) in the Office of Site Remediation
Enforcement Information regarding the model agreement and site specific inquiries
should be directed to Helen Keplinger ((202) 260-7116) in the Office of Site
Remediation Enforcement.
Attachment
-------
Guidance on Settlements with Prospective Purchasers
. of Contaminated Property
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
401 M Street, S.W.
Washington, DC 20460
-------
Guidance on Settlements with Prospective Purchasers
of Contaminated Property
I. Purpose
This document supersedes EPA's policy on agreements with prospective
purchasers of contaminated property as set forth in the June 6, 1989, policy document
entitled "Guidance on Landowner Liability under Section 107(a) of CERCLA, De
Minimis Settlements under Section 122(g)(l)(B) of CERCLA. and Settlements with
Prospective Purchasers of Contaminated Property"1 ("the 1989 guidance"). This revised
guidance reflects both Agency experience in implementing the 1989 guidance and
changes to that guidance that EPA believes are needed.
During the past several years, EPA has entered into a number of prospective
purchaser agreements to enable purchasers to buy contaminated property for cleanup,
redevelopment or reuse. The 1989 guidance required EPA to receive substantial
benefits in terms of work or reimbursement of response costs that otherwise would not
have been available. While some agreements required performance of cleanup work on.
contaminated parcels prior to their redevelopment, others provided covenants not to sue
for purchase of uncontaminated portions of larger Superfund sites. EPA's experience
has demonstrated that prospective purchaser agreements might be both appropriate and
beneficial in more circumstances than contemplated by the 1989 guidance. The Agency
now believes that it may be appropriate to enter into agreements resulting in somewhat
reduced benefits to the Agency through cleanup or response costs or in benefits that also
may be available from other parties. These agreements in turn should provide
substantial benefits to the community through the creation or retention of jobs,
productive use of abandoned property, or revitaliza&on of blighted areas.
While this new guidance restates much of the 1989 guidance, it revises two of the
original criteria used to determine whether a prospective purchaser agreement is
appropriate. The revised criteria allow the Agency greater flexibility to consider
agreements with covenants not to sue to encourage reuse or development of
contaminated nopeny thai would have substantial benefits to the community (e.g~
through job
-------
II. Statement of Policy
Beor.'se of the clear liabi!;w which attaches to landowners who acquire property
with knowledge of contamination, the Agency has received numerous requests for
covenants not to sue t'rom prospective purchasers of contaminated property/ It is the
Agency's" policy not to become involved in private real estate transactions. However, an
agreement with a covenant not to sue a prospective purchaser might appropriately be
considered if it will have substantial benefits for the government and if the prospective
purchaser satisfies other criteria3.
The Agency recognizes that entering into an agreemc..: containing a covenant not
to sue with a prospective purchaser of contaminated property, given appropriate
safeguards, may result in an environmental benefit through a payment for cleanup or a
commitment to perform a response action. EPA's experience has shown that prospective
purchaser agreements have also benefitted the community where the site is located by
encouraging the reuse or redevelopment of property at which the fear of Superfund
liability may have been a barrier. The Agency believes that it is necessary to provide
greater flexibility in offering covenants not to sue. Through this guidance, the Agency
adopts a policy which expands the circumstances under which prospective purchaser
agreements may be considered:
in. Criteria for entering into covenants not to sac with prospective purchasers
of contaminated property
The following criteria should be met before the Agency'considers entering into
agreements with prospective purchasers. These criteria are intended to reflect EPA's
commitment to removing the barriers imposed by potential CERCLA liability while
ensuring piUtection of human health and the environment. The Agency may also reject
any offer if it determines that entering into an agreement with a prospective purchaser is
not sufficiently in the public interest to warrant expending the resources necessary to
reach an agreement. Regions should consider the following criteria when evaluating
prospective purchaser agreements.
2 Sine* settlements with typical prospective purchasers (Le^ those who do not
currently ow«ate property, are not otherwise.involved with the site, and are, therefore,
not yet liabJJjfiJBef Section 107) will not be reached under Section 122, the procedures
and restrictiblprfe that section* such as those relating to covenants not to sue, will not
apply.
3This guidance is also applicable to persons seeking prospectiveiy to operate or
lease contaminated property. Agreements with prospective lessees/operators will be
evaluated using the criteria set forth in this guidance, and will require the currrnt
owner's signature.
-------
1. An EPA action at the facility has been taken, is ongoing, or is anticipated
to be undertaken bv the Agencv.
This criterion is meant to ensure that EPA does not become unnecessarily
involved in purely private real estate transactions or expend its limited resources in
negotiations which are unJikely to produce a sufficient benefit to the public. EPA,
however, recognizes the potential gains in terms of clean up and public benefit that may
be realized with broader application of prospective purchaser agreements. Therefore,
this criterion has been expanded beyond the limitation in the 1989 guidance to sites
where enforcement action is anticipated, to now include sites where federal involvement
has occurred or is expected to occur.
Accordingly, when requested, the Agency may consider entering into prospective
purchaser agreements at sites listed or proposed for listing on the National Priorities List
(NPL), or sites where EPA has undertaken, is undertaking, or plans to conduct a
response action.. If the Agency receives a request for a prospective purchaser agreement
at a site where EPA has not yet become involved, Regions should first evaluate the
realistic possibility that a prospective purchaser may incur Superfund liability when
determining the appropriateness of entering into a prospective purchaser agreement
This evaluation should dearly show that EPA's covenant not to sue is essential to
remove Superfund liability barriers and allow the private party cleanup and productive
use, reuse, or redevelopment of the site.
The Agency should consider the following factors when evaluating the
appropriateness of entering into an agreement with a prospective purchaser at any site:
a. Whether information regarding releases or potential releases of hazardous
substances at the site indicates that there is a substantial likelihood of federal
response or enforcement action at the site that would justify EPA's involvement in
entering into the prospective purchaser agreement EPA should consider
information that, is available through EPA's data systems, such as the
Comprehensive Environmental Response, Compensation, and Liability
Information System ("CERCUS"), a state agency, or through submissions from the
prospective purchaser, such as the results of an environmental audit or site
assessment.
b. "In igjJTjrirfii i available avenues te.y~ private indemnification agreements) may
exist liSHyPuentry alleviate the threat of Superfund' liability at the site without
the ne*3ffer EPA involvement In most cases EPA will decline to consider an
agreement at a site that is currently undergoing cleanup through a state program,
since future EPA activity at such a site is extremely unlikely.
Prospective purchaser agreements generally will not be appropriate at sites
screened out using the above criteria. For example, sites designated by EPA as No
Further Response Action Planned (NFRAP) and removed from CERCUS win rarely be
-------
deemed appropriate for a prospective purchaser agreemeni. Even at such sites, however.
EPA may, in extremely unusual circumstances, consider a prospective purchaser
agreement if it is in the public interest and the agreement is essential to achieve a vefy
significant public benefit.
2. The Agency should receive a substantial benefit either in the form of a
direct benefit for cleanup, or as an indirect public benefit in combination
with a reduced direct benefit-to EPA.
A cornerstone of the Agency's evaluation process under this policy is the
measurement of environmental benefit, in the form of direct funding, or cleanup, or a
combination of reduced direct funding or cleanup and an indirect public benefit. The
Agency believes that its past practice of limiting prospective purchaser agreements to
those situations where substantial benefit was measured .only in terms of cost
reimbursement or work performed may have decreased the effectiveness of this tool.
This guidance encourages a more balanced evaluation of both the direct and
indirect benefits of a prospective purchaser agreement "to the government and the public.
EPA recognizes that indirect benefits to a community is an important consideration and
may justify the commitment of the Agency's resources necessary to negotiate a
prospective purchaser agreement, even where there are reduced direct benefits to die
Agency in terms of cleanup and cost reimbursement
Therefore, EPA may continue to consider entering into prospective purchaser
agreements where there is a substantial direct benefit to EPA in terms of a commitment
to conduct the cleanup or to reimburse EPA's cost of cleanup. Furthermore, Regions
may now consider negotiating prospective purchaser agreements that will result in
substantial indirect benefits to the community as long as there is still some direct benefit
to the Agency. Both direct and indirect benefits should be measurable to enable EPA to
evaluate them effectively and to ensure they are substantial Examples of indirect
benefits to the community include measures that serve to reduce substantially the risk
posed by the site, creation or retention of jobs, development of abandoned or blighted
property, creation of conservation or recreation areas, or provision of community services
(such as improved public transportation and infrastructure.) Examples of reduced but
measurable benefits to EPA include partial cleanup or compensation.
i
• • '
While dtiifpoficy is intended to provide greater flexibility in providing prospective
purchaser agrdtfjus, EPA is not reducing its commitment .to environmental protection
or environmea^ptttce. The Agency intends to carefully weigh the public interest
considerations of"creating jobs in the inner city, where older contaminated industrial
properties are often located, against the possibility of further environmental degradation
of industrial property in mixed industrial/residential areas. EPA is committed to
working with purchasers of such property, to the extent possible, to ensure proper
cleanup and promote responsible land use.
-------
3. The continued operation of the facility or new site development, with the
exercise of due care, will not aggravate or contribute to the existing
contamination or interfere with EPA's response action.
Information which should be considered by the Agency to evaluate the effect of
new site development or continued operation ot' the facility could include site assessment
data and the Engineering Evaluation Cost-Analysis (EE/CA) or remedial
investigation/feasibility study (RI/FS), if available, and all other information relevant to
the condition of the facility. If the prospective purchaser intends to continue the
operations of an existing facility, the prospective purchaser should submit information
sufficient to allow the Agency to determine whether the continued operations are likely
to aggravate or contribute to the <»risting contamination or interfere with the remedy. If
the prospective purchaser plans to undertake new operations, or development of the
property, comprehensive information regarding these plans should be provided to EPA.
If the planned activities of the prospective purchaser are likely to aggravate or contribute
to the existing contamination or generate new contamination, EPA generally will not
enter into an agreement, or will include restrictions in the agreement which prohibit
those operations OF portions of those operations which are likely to aggravate or
contribute to the existing contamination or interfere with the remedy.
The Agency will determine on a case-by-case basis whether the available
information is sufficient for purposes of this evaluation. One key factor to be considered
is whether the remedial investigation or other site evaluation has been completed and
the extent of information which has been generated in that process. EPA may not enter
into an agreement if the available information' is insufficient for purposes of evaluating
the impact of the proposed activities.
4. The Continued operation or new development of the property will' not pose
health risks to the community and those persons likely to be present at the
site. .
EPA believes it is important to consider the environmental implications of site
operations on the surrounding community and to those likely to be present or have
access to the site.
5.
A setting party, including a prospect:-? urchaser of contaminated property,
should demonstrate that it is financially viable and capable of fulfilling any obligation
under the agreement. In appropriate circumstances, EPA may structure payment or
work to be performed to avoid or minimi** an undue financial burden on the purchaser.
-------
IV. Consideration
As a .latter or' law. it is necessary for EPA to obtain adequate consideration when
entering into a prospective purchaser agreement. In determining what constitutes
adequate consideration. Regions should consider a number or' t'actors. Initially, Regions
should examine the amount of past and future response costs expected to be incurred at
the site, whether there are other potentially responsible parties who can perform the
work or reimburse EPA's costs, and whether there is likely to be a shortfall in recovery
of costs at the site. Regions should then consider the purchase price to be paid by the
prospective purchaser, the market value of the property, the value of any lien on the
property under Section 107(1) of CERCLA, whether the purchaser is paying a reduced
price due to the condition of the property, and if so, the likely increase in the value of
the property attributable to the cleanup (e.g. compare purchase price or market price
with the estimated value of the property following completion of the response action).
Finally, Regions should consider the size and nature of the prospective purchaser and the
proposed use of the site (e.g. whether the purchaser is a large commercial or industrial
venture, a small business, a non-profit orcommunity-based activity). The analysis of any
benefits received by- the Agency also should contemplate any projected "windfall" profit
to the purchaser when the government has unreimbursed response costs, and whether it
is appropriate to include in the agreement some provision to recoup such costs. This
analysis should be coupled with an examination of any indirect benefit that the Agency
may receive (e.g.. demolition of structures, implementation of institutional controls) in
determining whether a prospective purchaser agreement provides a substantial benefit.
V. Public Participation
"In light of EPA's new policy of accepting indirect public benefit as partial
consideration, and the fact that the prospective purchaser agreements will provide
contribution protection to the purchaser, the surrounding community and other members
of the public should, be afforded opportunity to comment on the settlement, wherever
feasible. Because settlements with prospective purchasers are not expressly governed by
CEROUX. Section 122, there is no legal requirement for public notice and comment.
Whenever practicable, however, Regions should publish notices in the Federal Register
to ensure adequate notification of the agreement to all interested parties. Notice of a
proposed settlement, in the Federal register alone; however, will rarely be sufficient to
appropriately involve a community in the process concerning an agreement with a
prospective pnefiaser. Particularly in urban immunities and at facilities where
environmeni^BHttice is an issue. Regions should provide sufficient opportunities for
public infbrmifQla dissemination and facility pubuc input. Seekic ooperation with
state and local government may also facilitate public awareness and involvement.
Additionally, Regions should make a case-by-case determination of the need and level of
additional measures to ensure meaningful community involvement with respect to the
-------
•agreement. Because ot business considerations some prospective purchaser agreements
may be subject to relatively short deadlines. In these circumstances. Regions should
allow sufficient time for appropriate approvals and public comment prior to the deadline.
VI. Process
A mandatory consultation with the Director of the Regional Support Division,
Office of Site Remediation Enforcement, is required for any agreement entered with a
prospective purchaser of contaminated property. Any prospective purchaser agreement
can only be entered into with the express concurrence of the Assistant Attorney General.
It is important that Regions involve EPA Headquarters and the Department of Justice at
an early point in the process, and keep th^rn involved throughout the negotiations. In
particular, any draft settlement document should be forwarded to Headquarters and the
Department of Justice prior to being sent to a prospective purchaser. When seeking
approval for a settlement, it is important to explain the consideration for the covenant
not to sue, whether direct or a combination of direct and indirect benefits, how it was
determined, and why the Region considers it to be adequate.
This guidance and any internal procedures adopted for its implementation are
intended solely as guidance for employees of the G.S. Environmental Protection Agency
and creates no substantive rights in any persons. Case specific inquiry should be directed
to the Regional Support Division. Additional information on this policy is available from
Lori Boughton ((703) 603-8959), Elisabeth Freed ((703) 603-8936) in the Policy and
Program Evaluation Division, and Helen Keplinger ((202) 260-7116) in the Regional
Support Division.
Attached Model Agreement
-------
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
REGION
IN THE MATTER OF: [name]
[Docket Number]
UNDER THE AUTHORITY OF THE ) AGREEMENT AND COVENANT
COMPREHENSIVE ENVIRONMENTAL ) NOT TO SUE [Insert
RESPONSE, COMPENSATION, AND ) Settling Respondent's
LIABILITY ACT OF 1980, 42 U.S.C. ) Name]
S 960.1, et sea., as amended. )
[state law, if appropriate-] )
I. INTRODUCTION
'(
This Agreement and Covenant Not to Sue ("Agreement") is made
and entered into by and between the United States Environmental
Protection Agency ("EPA") [state of ] and [insert
name of Settling Respondent] (collectively the "Parties").
EPA enters into this Agreement pursuant to the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980,
as amended ("CERCLA"), 42 U.S.C. S 9601, et sea. [If the state
is a party, insert "The State of ' , enters into this
Agreement pursuant to [cite relevant state authority.]" and make
appropriate reference to state with respect to affected
provisions, including payment or work to be performed].
[Provide introductory information, consistent with
Definitions and Statement of Facts, about the party purchasing
the contaminated property including, name ("Settling
Respondent"), address, corporate status if applicable and include
proposed use of the property by prospective purchaser. Provide
name, location and description of Site.]
The Parties agree to undertake all actions required by the
terms and conditions of this Agreement. The purpose of this
-------
Agreement is to settle and resolve, subject to reservations and
limitations contained in Sections VII, VIII, IX, and X [If this
Agreement contains a separate section for Settling Respondent's
reservations, add section number], the potential liability of the
Settling Respondent for the Existing Contamination at the
Property which would otherwise result from Settling Respondent
becoming the owner of the property.
The Parties agree that the Settling Respondent's entry into
this Agreement, and the actions undertaken by the Settling
Respondent in accordance with the Agreement/ do not constitute an
admission of any liability by the Settling Respondent.
The resolution of this potential liability, in exchange for
provision by the Settling Respondent to EPA [and the state] of a
substantial benefit, is in the public interest.
II. DEFINITIONS
Unless otherwise expressly provided herein, terms used in
this Agreement which are defined in CERCLA or in regulations
promulgated under CERCLA shall have the meaning assigned to them
in CERCLA or in such regulations, including any amendments
thereto.
1. "EEA" shall mean the United States Environmental
Protection Agency and any successor departments or agencies of
the United States.
2. "Existing Contamination" shall mean any hazardous
substances, pollutants or contaminants, present or existing on or
under the Site as of the effective date of this Agreement.
-------
3. "Parties" shall mean EPA, [State of ], and the
Settling Respondent.
4. "Property" shall mean that portion of the Site which is
described in Exhibit 1 of this Agreement.
5. "Settling Respondent" shall mean .
6. "Site" shall mean the [Superfund] Site, encompassing
approximately acres, located at [address or description
of location] in [name of city/ county/ and State]/ and depicted
generally on the map attached as Exhibit 2. The Site shall
include the Property/ and all areas to which hazardous substances
and/or pollutants or contaminants/ have come to be located
[provide a more specific definition of the Site where possible/-
may also wish to include within Site description structures/
USTs/ etc].
7. "United States" shall mean the United States of America,
its departments, agencies, and instrumentalities.
III. STATEMENT OF FACTS
8. [Include only those facts relating to the Site that are
relevant to the covenant being provided the prospective
purchaser. Avoid adding information that relates only to actions
or parties that are outside of this Agreement.]
9. The Settling Respondent represents/ and for the purposes
of this Agreement EPA [and the state] relies on those
representations/ that Settling Respondent's involvement with the
Property and the Site has been limited to the following:
[Provide facts of any involvement by Settling Respondent with the
-------
Site, for example performing an environmental audit, or if
Settling Respondent has had no involvement with the Site so
state.]. .
IV. PAYMENT'
10. In consideration of and in exchange for the United
States' Covenant Not to Sue in Section VIII herein [and Removal
of Lien in Section XXI herein if that is part of the
consideration for the agreement], Settling Respondent agrees to
pay to EPA the sum of $ , within days of the
effective date of this Agreement. [A separate section should be
added if the consideration is work to be performed.] The
Settling Respondent shall make all payments required by this
Agreement in the form of a certified check or checks made payable
to "EPA Hazardous Substance Superfund," referencing the EPA
Region, EPA Docket number, and Site/Spill ID* [insert 4-
digit no.; first 2 numbers represent Region, second 2 numbers are
Region's Site/Spill ID no.], [DOJ case number , if
applicable] and name and address of Settling Respondent. .[insert
Regional Superfund Lockbox address where payment, should be sent].
Notice of payment shall be sent to those persons listed in
Section XV (Notices and Submissions) and to EPA Region
Financial Management Officer [insert address].
11. Amounts due and owing pursuant to the terms of this
Agreement but not paid in accordance with the terms of this
Agreement shall accrue interest at the rate established pursuant
to Section 107(a) of CERCLA, 42 U.S.C. S 9607(a), compounded on
-------
an annual basis.
[ .] FWORK TO BE PERFORMED!
[Include this section and other appropriate provisions
relating to .performance of the work/ such as financial assurance,
agency approvals, reporting, etc., where work to be performed is
the consideration for the Agreement.
. Statement of Work attached as Exhibit 3.]
V. ACCESS/NOTICE TO SUCCESSORS IN INTEREST
12. Commencing upon the date that it acquires title to the
Property, Settling Respondent agrees to provide to EPA [and the
state] its authorized officers, employees, representatives, and
all other persons performing response actions under EPA [or
state] oversight, an irrevocable right of access at all
reasonable times to the Property and to any other property to
which access is required for the implementation of response
actions at the Site, to the extent access to such other property
is controlled by the Settling Respondent, for the purposes of
performing and overseeing response actions at the Site under
federal [and state] law. EPA agrees to provide reasonable notice
to the Settling Respondent of the timing of response actions to
be undertaken at the Property. Notwithstanding any provision of
this Agreement, EPA retains all of its authorities and rights,
including enforcement authorities related thereto, under CERCLA,
the Solid Waste Disposal Act, as amended by the Resource
Conservation and.Recovery Act, 42 U.S.C. S 6901,("RCRA") et.
seq.. and any other applicable statute or regulation, including
-------
any amendments thereto.
13. Within 30 days after the effective date of this
Agreement, the Settling Respondent shall record a certified copy
of this Agreement with the Recorder's Office [or Registry of
Deeds or other appropriate office], County, State
of . Thereafter/ each deed/ title/ or other
instrument conveying an interest in the Property shall contain a
notice stating that the Property is subject to this Agreement. A
copy of these documents should be sent to the persons listed in
Section XV (Notices and Submissions).
14. The Settling Respondent shall ensure that assignees/
successors in interest/ lessees/ and sublessees, of the Property
shall provide the same access and cooperation. The Settling
Respondent shall ensure that a copy of this Agreement is provided
to any current lessee or sublessee on the Property as of the
effective date of this Agreement and shall ensure that any
subsequent leases/ subleases/ assignments or transfers of the
Property or an interest in the Property are consistent with this
Section, and Section XI (Parties Bound/Transfer of Covenant), of
the Agreement [and where appropriate. Section (Work to be
Performed) ] .!.'.•.
VI. DUE CARE/COOPERATION
15. The Settling Respondent shall exercise due care at the
Site with respect to the Existing Contamination and shall comply
with all applicable local, State, and federal laws and
regulations. The Settling Respondent recognizes that the
-------
implementation of response actions at the Site may interfere with
the Settling Respondent's use of the Property, and may require
closure of. its operations or a part thereof. The Settling
Respondent agrees to cooperate fully with EPA in the
implementation of response actions at the Site and further agrees
not to interfere with such response actions. EPA agrees/
consistent with its responsibilities under applicable law, to use
reasonable efforts to minimize any interference with the Settling
Respondent's operations by such entry and response. In the event
the Settling Respondent becomes aware of any action or occurrence
which causes or threatens a release of hazardous substances,
pollutants or contaminants at or from the Site that constitutes
an emergency situation or may present an immediate threat to
public health or welfare or the environment, Settling Respondent
shall immediately take all appropriate action to prevent, abate,
or'minimize such release or threat of release, and shall, in
addition to complying with any applicable notification
requirements under Section 103 of CERCLA, 42 U.S.C. §9603, or any
other law, immediately notify EPA of such release or threatened
release.
"VII. CERTIFICATION
16. By entering into this agreement, the Settling
Respondent certifies that to the best of- its knowledge and belief
it has fully and accurately disclosed to EPA [_and the state] all
information known to Settling Respondent and all.information in
the possession or control of its officers, directors, employees,
-------
contractors and agents which relates in any way to any Existing
Contamination or any past or potential future release of
hazardous substances, pollutants or contaminants at or from the
Site and to its qualification for this Agreement. The Settling
Respondent also certifies that to the best of its knowledge and
belief it has not caused or contributed to .a release or threat of
release of hazardous substances or pollutants or contaminants at
the Site. If the United States [and the state] determines that
information provided by Settling Respondent is not materially
accurate and complete, the Agreement/ within the sole discretion
of the United States/ shall be null and void and the United
States [and the state] reserves all rights it [they] may have.
VIII. UNITED STATES' COVENANT NOT TO SUE1
17. Subject to the Reservation of Rights in Section IX of
this Agreement/ upon payment of the amount specified in Section
IV (Payment)/ of this Agreement [if consideration for Agreement
is work to be performed/ insert/ as appropriate/ "and upon
completion of the work specified in Section (Work to Be
Performed) to the satisfaction of EPA"], the United States [and
the state] covenants not to sue or take any other civil or
administrative action against Settling Respondent for any and all
civil liability for injunctive relief or reimbursement of
Since the covenant not to sue is from the United
States/ Regions negotiating these Agreements should advise the
Department of Justice of any other federal agency involved with
the Site, or which'may have a claim under CERCLA with respect to
the Site and use best efforts to advise such federal agency of
the proposed settlement.
8
-------
response costs pursuant to Sections 106 or 107(a) of CERCLA, 42
U.S.C. §§ 9606 or 9607(a) [and state law cite] with respect to
the Existing Contamination.
IX. RESERVATION OF RIGHTS
18. The covenant not to sue set forth in Section VIII above
does not pertain to any matters other than those .expressly
specified in Section VIII (United States' Covenant Not to Sue).
The United States [and the State] reserves and the Agreement is
without prejudice to all rights against Settling Respondent with
respect to all other matters, including but not limited to, the
following:
(a) claims based on a failure by Settling Respondent to
meet a requirement of this Agreement, including but not limited
to Section IV (Payment), Section V (Access/Notice to Successors
in Interest), Section VI (Due Care/Cooperation), Section XIV
(Payment of Costs, [and, if appropriate, Section (Work to be
Performed)];
(b) any liability resulting from past or future releases of
hazardous substances, pollutants or contaminants, at or from the
Site caused or contributed to by Settling Respondent, its
successors, assignees, lessees or sublessees;
(c) any liability resulting from exacerbation by Settling
Respondent, its successors, assignees, lessees or sublessees, of
Existing Contamination;
(d) any liability resulting from the release or threat of
release of hazardous substances, pollutants or contaminants, at
-------
the Site after the effective date of this Agreement, not within
the definition of Existing Contamination;
. (e) criminal liability;
(f) liability for damages for injury to, destruction of, or
loss of natural resources/ and for the costs of any natural
resource damage assessment incurred by federal agencies other
than EPA; and
(g) liability for violations of local/ State or federal law
or regulations.
19. With respect to any claim or cause of action asserted
by the United States [or the state], the Settling Respondent
shall bear the burden of proving that the claim or cause of
action/ or any part thereof/ is attributable solely to Existing
Contamination.
20. Nothing in this Agreement is intended as a release or
covenant not to sue for any claim or cause of action/
administrative or judicial/ civil or criminal/ past or future/ in
law or in equity/ which the United States [or the state] may have
against any person/ firm/ corporation or other entity not a party
to this Agreement.
21. Nothing in this Agreement is intended to limit the
right of EPA [or the state] to undertake future response actions
at the Site or to seek to compel parties other than the Settling
Respondent to perform or pay for response actions at the Site.
Nothing in this Agreement shall, in any way restrict or limit the
nature or scope of response actions which may be taken or be
10
-------
required by EPA [or the state] in exercising its authority under
federal [or state ] law. Settling Respondent acknowledges that
it is purchasing property where response actions may be required.
X. SETTLING RESPONDENT'S COVENANT NOT TO SUE
22. In consideration of the United States' Covenant Not To
Sue in Section VIII of this Agreement, the Settling Respondent
hereby covenants not to sue and not to assert any claims or
causes of action against the United states [or the state], its
authorized officers, employees, or representatives with respect
to the Site or this Agreement, including but not limited to, any
direct or indirect claims for reimbursement from the Hazardous
Substance Superfund established pursuant to the Internal Revenue
Code, 26 U.S.C. $ 9507, through CERCLA Sections 106(b)(2), 111,
112, 113, or any other provision of law, any claim against the
United States, including any department, agency or
instrumencality of the United States under CERCLA Sections 107 or
113 related to the Site, or any claims arising out of response
activities at the Site, including claims based on EPA's oversight
of such activities or approval of plans for such activities.
23o The Settling Respondent reserves, and this Agreement is
without prejudice to, actions against the United States based on
negligent actions taken directly by the United States, not
including oversight or approval of the Settling Respondent's
plans or activities, that are brought pursuant to any statute
other than CERCLA or RCRA and for which the waiver of sovereign
immunity is found in a statute other than CERCLA or RCRA.
11
-------
Nothing herein shall be deemed to constitute preauthorization of1
a claim within the meaning of Section 111 of CERCLA, 42 U.S.C. §
9611, or 40 C.F.R. § 300.700(d).
XI. PARTIES BOUND/TRANSFER OF COVENANT
24. This Agreement shall apply to and be binding upon the
United States, [and the state], and shall apply to and be binding
on the Settling Respondent, its officers, directors, employees,
and agents. Each signatory of a Party to this Agreement
represents that he or she is fully authorized to enter into the
terms and conditions of this Agreement and to legally bind such
Party.
25. Notwithstanding any other provisions of this Agreement,
all of the rights, benefits and obligations conferred .upon
Settling Respondent under this Agreement may be assigned or
transferred to any person with the prior written consent of EPA
[and the state] in its sole discretion.
26. The Settling Respondent agrees to pay the reasonable
costs incurred by EPA [and the state] to review any subsequent
requests for consent, to assign or transfer the Property.
27. In the event of an assignment or transfer of the
Property or an assignment or transfer of an interest in the
Property, the assignor or transferor shall continue to be bound
by all the terms and conditions, and subject to all the benefits,
of this Agreement except as EPA [the state] and the assignor or
transferor agree otherwise and modify this Agreement, in writing,
accordingly. Moreover, prior to or simultaneous with any
12
-------
assignment or transfer of the Property, the assignee or
transferee must consent in writing to be bound by the terms of
this Agreement including but not limited to the certification
requirement in Section VII of this Agreement in order for the
Covenant Not to Sue in Section VIII to be available to that
party. The Covenant Not To Sue. in Section VI11 shall not be
effective with respect to any assignees or transferees who fail
to provide such written consent to EPA [and the state].
XII. DISCLAIMER
28. This Agreement in no way constitutes a finding by EPA
[or the state] as to the risks to human health and the
environment which may be posed by contamination at the Property
or the Site nor constitutes any representation by EPA [or the
state] that the Property or the Site is fit for any particular
purpose.
XIII. DOCUMENT RETENTION
29. The Settling Respondent agrees to retain and make
available to EPA [and the state] all business and operating
records, contracts, site studies and investigations, and
documents relating to operations at the Property, for at least
ten years, following the effective date of this Agreement unless
otherwise agreed to in writing by the Parties. At the end of ten
years, the Settling Respondent shall notify EPA [and the state]
of the location, of such documents and shall provide EPA [and the
state] with an opportunity to copy any documents at the expense
of EPA [or the state]. [Where work is to be performed, consider
13
-------
providing for document retention for ten years or until
.completion of work to the satisfaction of EPA, whichever is
longer.]
XIV. PAYMENT OF COSTS
30. If the Settling Respondent fails to comply with the
terms of this Agreement, including, but not limited to, the
provisions of Section IV (Payment), [or Section — (Work to be
Performed)] of this Agreement, it shall be liable for all
litigation and other enforcement costs incurred by the United
States [and the state] to enforce this Agreement or otherwise
obtain compliance.
XV. NOTICES AND SUBMISSIONS
31. [Insert names, titles, and addresses of those to whom
notices and submissions are due, specifying which submissions are
required.]
XVI. EFFECTIVE DATE
32. The effective date of this Agreement shall be the date
upon which EPA issues written notice to the Settling Respondent
that EPA [and the .state] has fully executed the Agreement after
review of and response to any public comments received.
XVII. ATTORNEY GENERAL APPROVAL
33. The Attorney General of the United States or her
designee has issued prior written approval of the settlement
embodied in this Agreement. .
XVIII. TERMINATION
34. If any Party believes that any or all of the
14
-------
obligations under Section V (Access/Notice to Successors in
Interest) are no longer necessary to ensure compliance with the
requirements of the Agreement, that Party may request in writing
that the other Party agree to terminate the provision(s)
establishing such obligations; provided, however, that the
pro.vision(s) in question shall continue in force unless and until
the party requesting such termination receives written agreement
from the other party to terminate such provision(s).
XIX. CONTRIBUTION PROTECTION
35. With regard to claims for contribution against Settling
Respondent, the Parties hereto agree that the Settling Respondent
is entitled to protection from contribution actions or claims as .
provided by CERCLA Section 113(f)(2), 42 U.S.C. S 9613(f)(2) for
matters addressed in this Agreement. The matters addressed in
this Agreement are [all response actions taken or to be taken and
response costs incurred or to be incurred by the United States or
any other person for the Site with respect to the Existing
Contamination].
36. The .Settling Respondent agrees that with respect to any
suit or claim for contribution brought by it for matters related
to this Agreement it will notify the United States [and the
state] in writing no later than 60 days prior to the initiation
of such suit or claim.
37. The Settling Respondent also agrees that with respect
to any suit or claim for contribution brought against it for
matters related to this Agreement it will notify in writing the
15
-------
United States [and the state] within 10 days of service of the
complaint on them.
XX. EXHIBITS
38. Exhibit 1 shall mean the description of the Property
which is the subject of this Agreement.
39. Exhibit 2 shall mean the map depicting the Site.
[—. Exhibit 3 shall mean the Statement of Work.]
XXI. REMOVAL OF LIEN
40. [Use this provision only when appropriate.] Subject to
the Reservation of Rights in Section IX of this Agreement, upon
payment of the amount specified in Section IV (Payment) [or upon
satisfactory completion of work to be performed specified in
Section (Work to be Performed)], EPA agrees to remove any lien
it may have on the Property under Section 107(1) of CERCLA, 42
U.S.C. S 9607(1), as a result of response action conducted by EPA
at.the Property.
XXII. PUBLIC COMMENT
41. This Agreement, shall be subject to a thirty-day public
comment period, after which EPA may modify or withdraw its
consent to this Agreement if comments received disclose facts or
considerations which indicate that this Agreement is
inappropriate, improper or inadequate.
16
-------
IT IS SO AGREED:
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
BY:
Regional Administrator, Region Date
IT IS SO AGREED:
BY:
Name Date
17
------- |