United States
Environmental Protection
Agency
ERA Comprehensive Environmental
Response, Compensation, and
Liability Act (CERCLA)
Compliance/Enforcement
Guidance Manual
Policy Compendium
Government Institutes Inc.
-------
United States
Environmental Protection
Agency
Comprehensive Environmental
Response, Compensation, and
Liability Act (CERCLA)
Compliance/Enforcement
Guidance Manual
Policy Compendium
Government Institutes, Inc.
-------
PUBLISHER'S NOTE
This publication was prepared by the U.S. Environmental Protection Agency
for use within the agency. Government Institutes determined that it con-
tained information of interest to parties outside EPA so we undertook on our
own to reproduce this material in order to serve those interested.
The material was prepared by EPA*s Office of Enforcement and Compliance
Monitoring and the Office of Solid Waste and Emergency Response to identify
CERCLA compliance/enforcement guidelines and policies that are currently
in effect. These policies and procedures are intended solely for the guidance
of U.S. EPA personnel. This Compendium is not intended to nor does it
constitute rule-making by the Agency, and may not be relied upon to create a
right or benefit, substantive or procedural, enforceable at law or in equity, by
any person. The Agency reserves the right to take any action alleged to be at
variance with the information, policies or procedures contained in this
Compendium, and may at any time revise this document and the information,
policies, and procedures that it contains.
This publication is designed to provide accurate and authoritative information
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that the publisher is not engaged in rendering legal, accounting or other
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Publication of this book does not signify that the contents necessarily reflect
the views or policies of Government Institutes, Inc.
November 1985
Published by
Government Institutes, Inc.
966 Hungerford Drive, #24
RockviUe, MD 20850
U.S.A.
ISBN: 0-86587-045-4
Printed and bound in the United States of America
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TABLE OF CONTENTS
Date
Title of Document
Page
GENERAL GUIDANCE
8/3/83 Cost Recovery Referrals (Sniff)
Cost Recovery Referrals Clarification (Sniff)—9/6/83
8/26/83 Cost Recovery Actions under CERCLA (Price/Thomas)
8/29/83 Coordination of EPA and State Actions in CERCLA Cost
Recovery Negotiations & Litigations
(Thomas/Price)
9/8/83 Guidance Memorandum on the Use and Issuance of
Administrative Orders under Section 106(a)
of CERCLA (Price/Thomas)
1/26/84 Releasing Identities of Potentially Responsible
Parties in Response to FOIA Requests (Lucero/Sniff)
2/21/84 Issuance of Administrative Orders for Immediate
Removal Actions (Thomas)
3/8/84 Delegation of Authority to Issue Demand Letters
(Lucero)
3/20/84 Participation of Potentially Responsible Parties in
Development of Remedial Investigations and Feasibility
Studies under CERCLA (Thomas/Price)
5/24/84 Guidance Regarding CERCLA Enforcement Against
Bankrupt Parties (Price)
2
4
5
104
123
159
162
174
176
185
9/10/84 Policy on Enforcing Information Requests in
Hazardous Waste Cases (Price)
10/2/84 EPA-State Relationship in Enforcement Actions for
Sites on the National Priorities List (Thomas)
10/12/84 Procedures for Issuing Notice Letters (Lucero)
226
243
258
111
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Table of Contents
CERCLA Policy Compendium
12/5/84 Interim CERCLA Settlement Policy
(Thomas/Price/Habicht)
1/23/85 Funding of State Enforcement-Related Activities
(Lucero)
3/22/85 Community Relations Activities at Superfund
Enforcement Sites—Interim Guidance (McGraw)
5/1/85 Drafting Consent Decrees in Hazardous Waste Imminent
Hazard Cases (Price/McGraw)
5/6/85 Procedures for Planning and Implementing Off-Site
Response Actions (McGraw)
8/28/85 Community Relations Activities at Superfund
Enforcement Sites (Lucero)
284
304
307
336
360
370
PROCEDURES MANUAL
1/30/85 Procedures for Documenting Costs for CERCLA
Section 107 Actions (Lucero)
374
RELATED GUIDANCE
6/13/84 Liability of Corporate Shareholders and Successor
Corporations for Abandoned Sites under CERCLA (Price)
9/21/84 Issuance of Final Revised Guidance on the Use and
Issuance of Administrative Orders under Section 7003
of RCRA (Price/Thomas)
9/26/84 Issuance of Administrative Orders under Section 3013
of RCRA (Price/Thomas)
1/31/84 Model Administrative Order on Consent for Private
Party Conduct of RI/FS (Lucero)
2/27/85 Preparation of Decision Documents for Approving
Fund-Financed and Potentially Responsible Party
Remedial Actions under CERCLA (McGraw)
484
500
532
545
563
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General Guidance
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. DC 304*0
3AU61983
MEMORANDUM
SUBJECT: Cost Recovery Referrals
orrtcK or
BMT COUMML
FROM: Kirk F. Sniff _ .
Acting Associafi Enforcement Counsel f
TO: Regional Counsels,
Regions I-X
Recently, you provided my office with projections of
hazardous waste civil referrals to Headquarters through the
remainder of FY 1983. Included in the projected total of 27
referrals were 19 cost recovery referrals. Nearly all of
these actions would involve recovery of costs associated
with immediate removals.
On July 27, 1983, we met with the Department of Justice to
discuss the most appropriate means for managing these expected
referrals. In light of our continuing difficulties with cost
documentation for existing referrals and actions, we agreed to
two basic rules for handling the anticipated §107
referrals:
1. OEC-Vaste will only accept referrals which include
appropriate cost documentation. If documentation is
inadequate, the referrals will be returned to the
Regions for further development. To assist you in
assessing the adequacy of your referral, I refer you
to the draft guidance, "Cost Recovery Actions Under
CERCLA," which was distributed to the Regional Division
Directors at their national meeting on May 11 and 12,
1983, and to the attached document entitled "Partial
List of Documents Needed to Support Cost Recovery." I
strongly recommend that you include copies of the sup-
porting documents in the referral package. If for
some reason this is not possible, the referral package
should clearly identify the specific documents which
support your claims. Ultimately, this documentation
will have to be provided to DOJ. If you have questions
regarding documentation in your specific cases, please
contact the appropriate Regional coordinator in my
office.
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PARTIAL LIST OF DOCUMENTS NEEDED TO SUPPORT COST RECOVERY
1. Total Payroll expenditures for attorneys, with supporting
tine cards and tine sheets
2. Total payroll expenditures for technical personnel,
with supporting tine cards and tine sheets
3. Total expenditures for travel for attorneys* with
supporting authorizations and vouchers.
4. Total expenditures for travel,for technical personnel,
with supporting authorizations and vouchers.
5. For PIT contract expenditures: affidavit by contractor
describing work done, hours spent, hourly cost, overhead
calculations and total cost; vouchers from contractor to
EPA requesting payment; Agency records showing authorization
for Treasury to pay contractor
6. For National Lab Contract expenditures: contractor
summary of samples taken at site and distributed to labs
for analysis, individual and total cost of sample analyses,
contractor overhead costs, name of lab conducting analyses,
sample numbers, invoice numbers, total costs, copies of
all invoices (types I and II), copies of bills from lab
to contractor and fron contractor to EPA' if "SAS" samples;
affidavit fron EPA official verifying contents of contractor
summary; copy of Agency's authorization for Treasury to
pay contractor; vouchers from contractor to Agency
requesting payment.
7. For expenditures by Regional Lab or ORD (e.g., aerial
photography): affidavit showing nature of work and total
cost, invoices, record of payment.
8. For immediate removals: contractor invoices certified
by OSC; record of authorization for Treasury to pay
contractor; daily contractor cost reports (rough and final);
daily verification of work and costs by OSC.
9. Documentation of expenditures by TAT and any other
contractors used, expenditures by other agencies,
expenditures by State under Superfund contract or
cooperative agreement.
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1
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. OC 204*0
ScP 6
OFFICE OF
KNPONCKMKNT COUMBKI.
MEMORANDUM
SUBJECT: Cost Recovery Referrals
FROM: Kirl/r. ttSnif f
Actlndhrasociate Enforcement Counsel for Waste
TO: OEC-W Staff
On August 3, 1983, I issued a memorandum stating several
general policies regarding the processing of referrals under
S107 of CERCLA. Since that time, a number of y-ou have raised
questions regarding my memorandum. This is intended to provide
further clarification.
1. The memorandum states that if, for some reason,
the Regions have not included copies of supporting documentation
in the referral package, the-referral should clearly identify
the specific documents which support the claims. This
identification should be in the form of a specific inventory
of the supporting documents, indicating the identity, location
and custodian of the documents. A general averment that
documentation is "available" will not suffice.
2. The memorandum states that DOJ will only file
those cost recovery claims for which there-is adequate docu-
mentation. However, there may be cases where those claims
which can be prosecuted immediately are not substantial when
compared with the total potential action. For example, if the
Region refers a case seeking recovery of 3200,000 but can only
document $8,000, the Headquarters attorney should seriously
consider declining the referral until further documentation
is provided. This decision is case-specific. However, as a
general guide, you should consider whether the documented case
is sufficient to stand on its own. Of course, in making your
recommendation you should also consider other important factors
such, as the Statute of Limitations, or the need to make a
protecrive filing fe. g. WA proof of claim).
I hope this answers some of your questions. If you have
other questions please feel free to raise them.
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COST RECOVERY ACTIONS
UNDER THE
COMPREHENSIVE ENVIRONMENTAL RESPONSE,
COMPENSATION, AND LIABILITY ACT OF 1980
(CERCLA)
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COST RECOVERY ACTIONS UNDER CERCLA
TABLE OF CONTENTS
I. Introduction 1
II. Assembling A Cost Recovery Action 3
III. Elements of a Cost Recovery Action 4
A. Evidence of Release or Substantial Threat
of Release of a Hazardous Substance .6
B. Evidence of Responsibility of Defendant(s) ... 9
C. Evidence that Removal or Remedial Action
Taken by U.S. or State is Not Inconsistent
With the National Contingency Plan 11
D. Proof of Costs of Removal or Remedial
Action by the U.S. or a State 13
IV. Procedural Issues 16
A. Timing of the Cost Recovery Action 16
B. Statute of Limitations 17
C. Extent of Liability of Responsible Action ... 18
D. The Demand Letter 20
•x
E. Procedure in Event of Response
To Demand Letter 22
1. Negotiating Teams and Procedures . . . . . .23
2. Form of Settlement Agreement 26
F. Procedure In Event of
No Response to Demand Letter 27
G. Maintenance and Coordination of
Evidence In Event of Referral 29
V. Note on Purposes and Use of This Memorandum 31
Appendix A (Costs Recoverable Under CERCLA)
Appendix B (Model Demand Letter)
Appendix C (List of Documents)
Appendix D (Model Cost Recovery Plan)
Appendix E (Regional Superfund File Structure)
6
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON DC 20460
MEMORANDUM ' ~~ * 19^
SUBJECT: Guidance on Pursuing Cost Recovery
Actions Under CERCLA
FROM: Courtney M. Price
/Special Counsel for Enforcement
M. Thomas
Assistant Administrator for
Solid Waste and emergency Response
TO: Enforcement Counsel
Regional Administrators
Regional Counsels
Associate Enforcement Counsel-Waste Division
Regional Superfund Coordinators
Air and Hazardous Substance Division Directors*
Environmental Services Directors
I. INTRODUCTION
Section 107 of the Comprehensive Environmental Response*
Compensation and Liability Act (CERCLA) provides generally that
past and present owners and operators of a site, and generators
and transporters who contributed hazardous substances to a Kite,
shall be liable (with certain limitations to be discussed herein)
for all costs of removal or remedial action undertaken by the U.S.
government, a State, or any other person, and for damages to or
loss of natural resources.
While it is highly desirable to obtain removal and remedial
action in the first instance by responsible parties, rather
than by the Environmental Protection Agency (EPA) or a State,
there are and will continue to be many cases in which the Agency
will authorize the use of CFRCLA funds from the Hazardous Substance
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Response Trust Fund (the Fund) established by CERCLA for these
actions, and thereafter attempt to recover those costs from the
party or parties who are liable under Section 107 of the Act and
other authorities.
Due to the possibility of cost recovery efforts in any case
in which CERCLA funds are expended/ the observation, documentation
and preservation of critical facts and response costs is important
to assure that:
* potential evidence concerning the site I/ and responsible
parties is noted and documented before response activity
or the passage of time obscures or eliminates it;
* physical evidence essential at trial is collected and
preserved appropriately; and
* sufficient evidence of total costs and claims paid from the
Fund has been maintained and is available to support recovery
by the government.
This memorandum describes essential elements which the
government will probably be called upon to prove in a cost
recovery action; the assembly and maintenance of a file; some
examples of appropriate documentation for each element of the
cause of action; procedures for processing and negotiating cost
recovery claims; and the mechanics of repayment of any recovery to
the Fund. This guidance must be observed by EPA employees, con-
tractors, and, where appropriate, employees of State agencies
working on a site on which CERCLA funds are expended under an
T/ The word "site" as used herein applies to a»ny location where a
release or spill has occurred, and maybe used interchangeably with
"facilitv" as defined in CERCLA 5101(9).
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EPA-Statc cooperative agreement, in every situation in which CERCLA
funds are expended for site clean up, since each of these sites is
the subject of a potential cost recovery action. The Office of
Waste Programs Enforcement is preparing an additional cost docu-
mentation guidance; please contact Libby Scopino (382-4482) for
assistance.
II. ASSEMBLING A COST RECOVERY ACTION
The assembly of evidence for a cost recovery action begins
with the first response action taken under Section 104 of CERCLA.
The filing of a cost recovery action should be presumed; accordingly
the collection of relevant documentation is important. Generally,
the government will pursue a cost recovery action when there is a
solvent responsible party.2/ Where other government action against
the responsible party is contemplated or pending, such as a judi-
cial action under Section 7003 of RCRA or Section 106 of CERCLA to
compel remedial measures at a site, a cost recovery count under
Section 107 of CERCLA for removal or remedial costs can be added
to the ongoing litigation.
The Regional Program office has the responsibility of
collecting and maintaining the documents used as evidence in
cost recovery actions. In matters which require legal opinions
(such as the legal right of the Agency to enter a facility) or the
preparation of legal documents, the program office should consult
with and obtain the assistance of the Regional attorney or the
appropriate Headquarters attorney.
2/ For a discussion of the factors to be considered in determining
whether to file a cost recovery action, see Part IV.P.
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III. ELEMENTS OF A COST RECOVERY ACTION
Under Section 104 of CERCLA, the U.S. or its authorized
representative may take removal or remedial action at a site
when, inter alia/ any hazardous substance is released or there
is a substantial threat of such a release into the environment,
unless EPA determines that such action will be done properly
by the owner or operator or by any other responsible party.
The government may pursue an action under 5107(a) for (1)
costs of removal or remedial action incurred by the U.S. not
inconsistent with the National Contingency Plan (NCP), or
(2) claims paid by the Fund for costs of response incurred
•
by a state not inconsistent with the NCP, or by other parties
not inconsistent with the NCP.2/ Section 104(b) also authorizes
the recovery of costs of sampling, analysis, monitoring and
surveying programs, and certain other costs, including those
3/ There may also be a claim made by trustees under Section
T07(a) (-1) (c) of CERCLA for damage to or loss of natural resources.
However, until regulations for assessment of natural resource
damages or destruction are promulgated pursuant to Section 301(c)
of the Act, claims for such damages will be assessed on a case-by-case
basis. The best records available on those damages should be
maintained until specific guidance is developed on that subject.
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for planning, legal and engineering services.4/
Therefore, to successfully pursue a cost recovery action, EPA
should be prepared to introduce evidence demonstrating:
1. release of a hazardous substance or the substantial threat
of such a release; and
2. the responsibility of the defendant(s); and
3(a), removal or remedial actions taken by the U.S. or the
State which were not inconsistent with the NCP 5/1 and/or
4. the costs of action taken by the U.S., a State, or
any other person.
The financial condition of a responsible party is not an
essential element of proof of the cause of action.£/ Even so* the
financial condition of the responsible parties may be considered
in determining the feasibility of a cost recovery action.
±/ For a list of costs which are recoverable under CERCLA, see
Appendix A.
5/ Although Agency policy is to maintain evidence that its
response activities are not inconsistent with the NCP, the Agency takes
the position that the defendant has the burden of proof on this issue.
£/ While we do not believe that it is necessary to introduce
evidence that removal and remedial action would not have been
done properly by the owner or operator of a facility or by any
other responsible party, it would be prudent to have available
evidence of efforts by the Agency to obtain private party response
action at the site. The notice letters forwarded by the Agency
to potentially responsible parties and their responses are
examples of such evidence.
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The chief elements of a cost recovery action and the
nature of evidence required to sustain then are discussed below.
A. Evidence of Release or Substantial Threat of Release
of a Hazardous Substance
A release of a hazardous substance or the substantial threat
of such release from a facility must be shown. The term "hazardous
substance* includes inter alia, any material designated as hazardous
or toxic under the Clean Water Act, Toxic Substance Control Act,
or the Clean Air Act or designated as a hazardous waste under RCRA
.(see 40 CFR 302). The definition should be consulted since it
does not include every pollutant or contarainant.2/
Appropriate documentation of evidence of a release or sub-
stantial threat of release includes field notes, photographs of
the scene, statements from witnesses, statements from owners or
operators, follow-up narrative reports or memoranda describing the
scene or observations first hand, samples of air* soil, water or
leachate discharge and laboratory analyses of the samples. Evidence
7/ Section 104(a) of the Act authorizes the President (or his
designer) to take response action whenever there is a release or
threat thereof of a hazardous substance, or. whenever there is a
release or substantial threat of a release of "any pollutant or
contaminant which may present an imminent and substantial endanger-
ment to the public health or welfare...*. However, Section 107
refers only to liability of owners, operators, transporters and
generators for costs incurred in responding to releases or threats
of releases of "hazardous substances". It is not clear whether
those persons may also be liable under $107 for costs incurred in
responding to releases or threats of releases of any pollutant or
contaminant which is not a defined hazardous substance, but which
may present an imminent and substantial endangerment. The government
intends to hold such persons liable for those costs under both sects
107 of CERCLA and the common law theory of restitution.
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collected must be sufficient to demonstrate this aspect of the
case.
There are three important considerations here-
First, samples, records of the owner/operator, or other
evidence sufficient to establish the identity of hazardous sub-
stances involved should be collected.
Procedures similar or identical to those used by the National
Enforcement Investigations Center (NEIC) £/ should be followed, as
should the requirements of Section 104(e) (1)(B), which provides
for furnishing a receipt to the owner/operator for any samples
taken rand a split sample, if requested). Observance of chain-of-
custody procedures is necessary to demonstrate at trial that
samples analyzed as hazardous substances did, in fact, originate
at the site.
Collecting more data and documentation about sites than is
reasonably necessary may increase total response costs to an
unduly high level and delay clean-up activities and cost recovery.
The number of samples collected is primarily a matter within the
judgment of the Regional and Headquarters Superfund Offices, and
will necessarily depend to a great extent on the site and the
affected areas of the environment. These Offices should consult
with the Regional Counsel prior to collecting samples. However,
the Agency should generally collect only enough samples to determine
(1) that a hazardous substance is present on the site; (2) that a
8/ NEIC Policies and Procedures Manual, May, 1978 (rev., Dec.
T981), EPA Document No. 330-9-78-001-R.
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release of the hazardous substance is substantially threatened or
has occurred: and (3) what response is appropriate. Only unusual
circumstances (e.g., to satisfy doubts over validity of previous
samples, to determine whether concentrations of hazardous substances
are increasing, etc.) would justify incurring significant additional
costs for any additional sampling and analysis.
Samples should be taken in accordance with EPA-approved
protocols and procedures developed by NEIC and contained in its
Policies and Procedures Manual referred to above or similar
procedures.
Second/ collection of this evidence should begin immediately
upon the start of any investigation into whether some response
activity (including sampling and surveying) may be needed at the
site in response to a release or threat of release. Passage of
time or deliberate interference by other parties may literally
destroy the evidence. Similarly, a long delay between the initial
observation and the trial, or the initial observation and .the
recordation of that observation, will make testimony by witnesses
about the site more difficult. Photographs of the scene before,
during and after the response action are frequently helpful in
preparing witnesses to testify, and in providing a visual record
to the Court of conditions that prompted the response activity.
Field notebooks and the results of laboratory analysis are
critical in showing the conditions that existed at the site and
establishing a potential link to the defendant. Sampling and
analysis should be conducted with particular concern for accuracy,
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detail, completeness and quality, since these documents are likely
to be subject to close scrutiny by responsible parties and the
court. The NEIC has developed inspection and analysis procedures
to assure high quality evidence and documentation for trial.
Observance of NEIC procedures assures a consistently high quality
of evidence, and should be followed by EPA employees, other federal
agencies, contractors., and State agencies which have entered into
an EPA cooperative agreement for response using CERCLA funds.
Third, for ease of assembling the case and presenting it for
trial, the following people should be identified by name, relevant
qualifications or connection to the case, and information about
how to contact them in the future: 1) persons who participated
in the site inspection, sampling, analysis or photography; 2)
persons who may have historic or current information from personal
observation, 3) people who gave or refused to give statements.
B. Evidence of Responsibility of Defendant(s)
In most cases, the liability of defendants will be demonstrated
by establishing the elements in subsections (l)-(4) of S107(a).
EPA personnel have a variety of techniques to gather evidence
connecting the hazardous substance with the potentially responsible
party or parties. For example, a deed or lease evidences the
responsibility of owner or operator of the site. Less formal
evidence can also be helpful in tracing rcsponsiblity. The operator's
presence at the site over a period of time will usually be noted
by employees, neighbors, law enforcement officers, competitors or
others close to or interested in such activities. Those observations
should be recorded in signed statements or affidavits. In addition.
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the activities of operators of a site may require a license or
permit under State or local laws and regulations. The appropriate
agencies should be consulted to determine whether they have any
record of activities by an operator of the site.
The problem of linking a transporter or generator of a hazardous
substance to a site is frequently a more difficult undertaking.
The following detection sources may prove fruitful. Often, operators,
generators, and transporters have records of business transactions.
Drums located on-site may bear labels or markings with the name of
a generator; these drums or labels should be preserved, if possible,
or photographed, and the photographs labeled for identification
and future use as possible evidence. Under certain circumstances
the case development team may decide to perform a chemical analysis
of the waste to assist in establishing the similarity between the
wastes and a particular company's process.2/ (Information regarding
parties and sites may also be obtained by use of letters issued
under authority of RCRA Section 3007 and CERCLA Section 104(e)).
Again, local residents, law enforcement officials or compe-
titors may be sources of information on transporters of material
to the site or in the general vicinity. Employees or former
employees of a generator or transporter may be willing to discuss
the disposal practices of their employers, and if so, signed
statements or affidavits, if possible, should be obtained from
them.
9/ Information on the composition of waste streams associated
wTth various industrial processes may be obtained from the Hazardous
and Industrial Waste Division (WH-565), Office of Solid Waste, U.S.
Environmental Protection Agency, 401 M Street, S.W., Washington, D.C*
20460.
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C. Evidence That Removal or Remedial Action Taken By the U.S. or
State Is Not Inconsistent With The National Contingency Plan
Pursuant to Section 104 of CERCLA, after information is
gathered that a release has occurred or is threatened, a variety
of actions may be taken by EPA or a State. Among those actions
are:
(i) Investigations, monitoring, surveys, testing and other
information gathering as may be necessary and appropriate to identify
the existence and extent of the release or threat thereof, the
amount, source and nature of the hazardous substances, and the
extent of danger to public health, welfare or the environment. In
addition, such planning, legal, fiscal, economic, engineering,
architectural and other studies or investigations may be undertaken
as necessary and appropriate to plan and direct response action;
(ii) "Removal actions", as the term is defined in Section
101(23) of CERCLA, and which includes, without limitation, security
fencing, provision of alternative temporary water supplies, and
temporary evacuation and housing of threatened individuals. In
addition, EPA may take such other action as may be necessary
to prevent, minimize or mitigate damage to public health, welfare
or the environment, such as removal of materials, temporary diking
and other easily accomplished actions; and
(iii) "Remedial actions", as the term is defined in Section
101(24) of CERCLA, including installation of a clay cover, dredging
or excavations, collection of leachate and runoff, on-site storage,
treatment or incineration, provision of alternative water supply
and clean-up of released hazardous substances. Subject to some
restrictions, it may also include permanent relocation of residents
arid business and community facilities, and off-site transportation,
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storage, treatment or disposal of hazardous substances.
In a cost recovery action, two factors are important in the
development and preservation of evidence regarding the appropriate-
ness of the action taken by EPA or the state. These factors are:
A. The action was not outside what CERCLA allows.
B. The action taken must be "not inconsistent" with the NCP,
Therefore, the NCP should be referred to and all persons involved in
the decision-making process should be familiar with its requirements
and limitations before decisions regarding actions are made 10/.
Those decisions should be documented by notes, memoranda, letters
and other written records maintained in the appropriate files.
Under the NCP, remedial actions must also be shown to provide
a cost-effective response. A cost-effective remedy is one which,
among the alternatives examined, is least costly but technologically
feasible, reliable and adequately protects public health and the
environment. In addition, under the Section 104 (c)(4) balancing
test, the Agency should document remedial actions to refute any
claims that the remedy was not cost-effective. Measures of cost-
effectiveness includes the protection afforded public health,
welfare and the environment by the remedy. In "immediate removal"
actions it will be especially important to document the circumstances
which justify the need for immediate action. As provided in section
300.65 of the National Contingency Plan, an immediate removal is
#
appropriate when the lead Agency determines that the initiation
of immediate removal action will prevent or mitigate immediate
risk of harm to human life or health.
10/ The National Contingency Plan is published in 40 CFR Part 300,
47 Fed. Reg. 31180 (July 16, 1982).
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Immediate removals are appropriate in such situations as: 1)
human/ animal, or food chain exposure to acutely toxic substances;
2) contamination of a drinking water supply; 3) fire and/or
explosion; or 4) similarly acute situations.
Evidence of the cost-effectiveness of a particular remedial
action may be demonstrated by the following evidence which is
contained in summary form in the record of decision:
• studies showing the technical feasibility and probable
cost of alternative remedial actions on the particular
site;
0 information that shows the degree of risk to public health,
welfare and environment presented by the particular site
(i.e., population threatened, media affected, toxicity of
the hazardous substance involved, etc.);
0 other documentation generated in consideration of the
various factors required by Section 300.68 of the NCP.
All such evidence should be documented by written studies,
reports, letters, memoranda, notes, minutes of meetings and any
other record of the relevant bases for taking a particular remedial
action.
D. Proof of Costs of Removal or Remedial Action by the U.S.
or a State
Collecting evidence of costs of removal or remedial action
taken on a site is likely to be a time consuming task. Documents
must be obtained from a variety of participants in the cleanup
activity: agencies, contractors, and others. The success of
19
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government cost recovery actions depends upon the use of good
bookkeeping and record collection techniques.
Certain costs expended on removal and remedial action are not
recoverable. For example, no recovery under CERCLA is permitted
•
where response costs resulted from application of a FIFRA-registered
product (see Section 107(i)), or from a Federally-permitted release
(see Section 107(j)). In borderline cases, it should be assumed
that removal and remedial action costs are recoverable and records
developed and maintained with this expectation.
A variety of mechanisms are available for tracking costs.
While EPA prefers the uniformity of a single accounting system,
the particular method of accounting may vary if it ensures accurate
record keeping and preservation of all costs attributable to a
particular site. To further this objective, cooperative agree-
ments between EPA and a State, or contracts between. EPA and a
contractor for performance of response activity on a site, should
specifically require that accounting procedures used by the State
or contractor be approved by EPA.
An accounting and expense-tracking system is already in
place at EPA, and should be followed closely by all EPA personnel,
contractors and State agency personnel working on CERCLA-funcled
sites. This system generally involves the assignment of a unique
accounting number to each specific site, and the charging of time,
material and other expenditures to that account number. The site
number is assigned by Headquarters based on a request from the
Regional Office and confirmation of an approved Federal response.
20
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In addition, activity codes have been devised under which different
activities and phases of site clean-up and remedial action may be
described. Questions regarding the specifics of these accounting
procedures should be directed to the Financial Management Center
in the Office of Emergency and Remedial Response (FTS 382-2208).
Evidence of the cleanup costs should be preserved and -avail-
able for introduction into evidence. This could include such
documentation as receipts for money paid for goods or services;
cancelled checks; contracts and any amendments thereof; purchase
orders; invoices; records of time spent, where the claim includes
the value of such time; travel records and vouchers; and records
of all correspondence or other communication regarding the actual
costs, as well as progress reports on the work performed. The
namesr addresses and telephone numbers of all persons maintaining
the regular business records of contractors, agencies or persons
outside EPA should also be maintained for ready reference, ll/
ll/ The Emergency Response Division of the Office of Solid Haste
and Emergency Response of EPA is developing a field manual entitled
•Cost Control Management for Superfund Removal" for immediate and
planned removal actions.* This manual presents a management system
for On-Scene Coordinators for controlling, verifying, and documenting
all costs incurred in a removal action.
21
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IV. PROCEDURAL ISSUES
A. Timing of the Cost Recovery Proceeding
While the Office of Waste Programs Enforcement will work with
the Regional Program Office in setting priorities for cost recovery,
the following basic timing guidelines are offered* Cost recovery
actions for expenses incurred in immediate or planned removals
will normally not be initiated until after such response activity
has been completed, since the time required for those activities
is relatively short. However/ a cost recovery action need not be
delayed where the Agency establishes a multiphase response action
(e.g., surface clean up, groundwater clean up). A cost recovery
action can begin before completion of the last phase of response
activity for costs expended to date and also for calculable future
costs.
Where one stage of cleanup follows another in fairly rapid suc-
cession, cost recovery actions should be initiated after the cleanup
is fully completed. In situations where there are substantial delays
between phases, however, the Agency may decide to commence a recovery
action at an intermediate stage. In these instances, negotiations
regarding recovery of expenditures may be combined with discussions
with responsibile parties over prospective cleanup activities.
Generally, an action will not be filed for recovery of a remedial
investigation/feasibility study or the cost of design prior to the
filing of an action for recovery of construction costs.
22
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B. Statute of Limitations
CERCLA does not contain a time limitation provision within
which a cost recovery action must be brought. In the absence of
a specific statutory provision/ the Federal statute of limitation
would apply. There is some doubt at this time as to precisely
which limitation period will be applied to a cost recovery action.
Limitations for actions brought by the United States for money
damages are contained in 28 USC Section 2415, which distinguishes
between actions based in tort or in contract. Because cost
recovery actions are essentially quasi-contractual actions in
the nature of restitution, a six year statute of limitations if
any, should apply. However, since it is possible that a court
may see CERCLA actions arising out of the tortious conduct of
others, cost recovery actions should be brought within three
years after the right of action accrues.
The date the cause of action accrues is also subject
to debate. In United States v. The Barge Shamrock et al, 635
F.2d 1108, 1110 (4th Cir., 1980), cert, den. 102 S.Ct. 125 (19811,
the Fourth Circuit held that a cost recovery action under the
Federal Water Pollution Control Act arising out of an oil spill
first accrued when the government completed the cleanup operation.
On the other hand, a defendant might well be expected to argue
that the cause of action accrues at the time funds are first
expended on the site. In order to avoid argument on this point,
23
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and to eliminate a potential bar to recovery/ the Agency should
attempt to commence all cost recovery action within three years of
the date dollars are first expended.
C. Extent of Liability of Responsible Parties
While CERCLA Section 107(a) identifies parties who are
responsible for the costs of response actions at a site/ the
statute does not expressly set forth the the nature of that
liability. Language which imposed "strict/ joint and several*
liability on the responsible parties was dropped from earlier
drafts in the final, compromise bill/ and replaced with a definition.
in Section 101 of •liable" or "liability" which refers to the standard
of liability which obtains under Section 311 of the Federal Water
Pollution Control Act. Section 311 is a strict liability statute.
Ci.ty of Philadelphia v. Stepan Chem. Co.> 544 P. Supp. 1135/ 1140.
*
n.4 (E.D. Pa. 1982). Moreover/ section 311 imposes joint ana
several liability, U.S. v. M/V Big Sam, 681 F.2d 432,439 (5th Cir.),
on pet. for reh., 693 F.2d 451 (5th Cir. 1982).
The position of EPA is that in appropriate circumstances/ joint
and several liability is applicable under CERCLA. This position is
supported by reference to section 311/ by the legislative history of
CERCLA 12/, and by Section 107(e)(2) of CERCLA/ which provides that
nothing in CERCLA "shall bar a cause of action that an owner or
operator or any other person subject to liability under this section..,
has or would have by reason of subrogation or otherwise against any
person."
127126 Cong. Rec., S.19964 (daily ed. Nov. 24/-1980);
T2~6 Cong. Rec., H.11707 (daily ed. Dec. 3, 1980).
24
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Th e Department of Justice has interpreted this section as confirm-
ing a defendant's right of contribution against other responsible
parties, which is only of value to a defendant who has been
held jointly and severally liable 13/.
Joint and several liability is traditionally imposed when
the actions of two or more defendants cause a single, indivisible
result, (Prosser, Law of Torts, (4th ed. 1971), Sec. 52.) That
determination may involve factual issues. Therefore, where
two or more parties in the categories of responsible parties listed
in Section 107{a) contribute hazardous substances to a facility
which are being released, threaten to be released, or are contributing
to the release or threat, the Agency may argue that those parties
are jointly and severally liable for the costs of responding to
that release or threat.
This of course does not foreclose the Agency from entering
into consent decrees or other appropriate agreements with multiple
responsible parties in which they agree to allocate the Agency's
response costs among themselves. The Agency is primarily con-
cerned with achieving cleanup of hazardous sites, preferably by
private action, and there are many reasons why responsible parties
may wish tb share the costs. However, this is primarily a matter
for the responsible parties, and if they cannot agree among
themselves on an appropriate allocation of responsibility, EPA
should proceed with legal action on a theory of joint and several
liability.
13/Letter dated December 1, 1980, from Alan A. Parker, Assistant
Attorney General, Office of Legislative Affairs, to Hon.
James J. Florio, 126 Cong. Rec. H11788 (daily ed. Dec. 3, 1980).
25
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D. The Demand Letter
The first formal step in the commencement of a cost recovery
proceeding will be the issuance of a letter of demand from EPA to
the potentially responsible party or parties for payment of
costs expended on the site. A demand letter should be sent to
all parties in a case who have been identified as potentially
responsible (i.e., past and present owners/operators of a site
and generators and transporters who contributed hazardous sub-
stances to a site), and should be issued after all response
activity has been completed, or at the completion of one phase
of a multi-phase response where the entire process will require
an extended period of time.
Before a demand letter is sent, the potential case should
be analyzed for the elements in part III above, including ident-
ification of all potentially responsible parties (including
responsible individuals in corporations where appropriate) and
assembly of cost information. At the time the demand letter is
sent, the Agency should be able to answer reasonable questions
posed by a recipient of the letter. Regional personnel should
have referred the case to Headquarters (or recommended against
an action) and Headquarters staff should have resolved their
position on a referral so that the Government is prepared to
file a complaint if the response to the demand letter is unsat-
isfactory.
The letter should be issued where response costs have been
incurred under CERCLA, regardless of whether a decision has been
26
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made to initiate a judicial proceeding for cost recovery.
The demand letter should contain the following points:
0 reference to EPA's authority-to administer CERCLA and
the Fund established thereunder (or reference to
authority to recover costs where the response activities
for which reimbursement is sought occurred prior to
CERCLA);
0 the location of the site;
0 the presence of a hazardous substance which was re-
leased or threatened to be released;
0 in general terms, the dates and types of response activity
undertaken by EPA at the site;
0 any notice given to the recipient prior to or during the
response activity, allowing the recipient the opportunity
to undertake the work or pay the expense of response;
e the total cost of the response activity 14/ broken down into
general categories;
177The amount stated in the demand letter should be the total
obligated by the Agency to be expended on the site, rather than
the amount shown by Agency records to have been expended on the
site at the time the letter is prepared. This is to avoid problems
caused by delays in payment of response costs after a demand letter
has been forwarded to the responsible party. Even so, available
records should be assembled as soon as possible. Where it
is expected that future costs will be paid (e.g., in the
next phase of response activity), the letter should also
clearly state that in addition to the sums already obligated
and spent, the Agency expects to expend additional sums on
the site for which claim will be made against the responsible
party. Of course, in a judicial proceeding in the cost
recovery action, the Agency will be required to prove the
actual amounts spent from the Fund.
27
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-22-
0 a general statement that the Agency believes that the
recipient is a responsible party and liable for the sum
set forth;
• a demand for payment;
0 a statement that the recipient of the letter should contact
EPA within a specified period (normally thirty days) to
discuss the account and the recipient's liability therefor;
• a warning that if recipient fails to contact the Agency
within the specified time, a suit may be filed in the
appropriate U.S. District Court for recovery of the
claim; and
• the name/ address and telephone number of a representative
of the Agency who the recipient should contact. A sample
demand letter is attached to this memorandum as Appendix B.
The primary responsibility for preparation of the demand
letter will be in the Regional Program Office. The Regional
Program Office should consult with the representatives from
OWPE, Regional Counsel/ and Office of Enforcement Counsel-Haste.
The demand letter will be sent through the Office of Waste Programs
Enforcement for the signature of the Director of OWPE unless
that requirement is specifically waived. If a case is referred
to DOJ, the DOJ case attorney should sign the demand letter.
E. Procedure In Event of Response From Potential Defendant
In many cases, the recipients of demand letters will contact
the Agency and express interest in discussing their status as a
responsible party. The Agency encourages such negotiations.
28
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-23-
CERCLA money is limited; Agency cleanup activities deplete the
fund and money must be recovered from the parties responsible
for the release or threat of release. Therefore cost recovery
through negotiation or litigation is necessary to clean up the
greatest number of sites. Cost recovery should involve the
coordinated efforts of knowledgeable legal and technical personnel
at both the Regional and Headquarters offices as explained below.
1. Negotiating Teams and Procedures
Upon receipt of a response to the demand letter from a
potentially responsible party, the contact person named in the
demand letter will notify the Associate Enforcement Counsel for
Waste, the Regional Counsel, the Director of OWPE and the Regional
Superfund office. Each of those offices will, upon notification,
identify the person who will represent it on the negotiating
team. (The Department of-Justice may participate in cases which
are likely to result in consent decrees or litigation.)
The formulation of the Agency's position results from the
collaboration of the Team. In some policy decisions the entire
Team has relevant background to participate in the decision making
process. However the specialized legal or technical talent on
the Team should be efficiently used.
The Team has the responsibility for developing a proposed
negotiating schedule. The proposed schedule should have the
concurrence of the Associate Enforcement Counsel for Waste and
the Director, OWPE in cases of national significance.
29
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-24-
Some factors which should be considered in the development
of this schedule are the number of potentially responsible parties
who will take part in the negotiations; the nature of the potential
defenses; the amount of available data linking particular parties
to the site; the amount of the claim, and other related matters.
Sufficient time should be allowed for the negotiation process to
take place/ but it is important that a deadline be established as
a goal for achieving a settlement, and beyond which the negotia-
tions will not continue, absent clear indications that a settlement
is imminent. A reasonable period of time for most negotiations is
60-90 days; negotiations should not be extended without Headquarters
approval. A referral should be submitted by the Region and approved
by Headquarters, and a complaint should be prepared and approved
by'the Department of Justice, prior to the conclusion of negotiation
so that an action may be filed if negotiations are not resolved by
the deadline.
a. Case Team Leader. Contemporaneous with the formation of
the Negotiating Team, Regional and Headquarters program managers,
in consultation with OLEC, will select a program official to serve
as the Case Team Leader. The Case Team Leader's function will be
to:
• focus efforts to develop, in advance of negotiations, the
Agency's negotiating strategy and position on issues that
may arise during the course of the case;
• ensure the coordination of legal and technical staff par-
ticipation on the team by scheduling and chairing regular
case review sessions; and
• define the Agency's objectives in accordance with applicable
Agency guidances and policies.
30
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-25-
On occasion, the Team may be unable to develop a consensus
on a cost recovery issue. When this occurs, the Case Team Leader
will prepare a written explanation of the issue for resolution
by the appropriate supervisory staff.
b. Lead Negotiator. Regional Counsel and Headquarters Enforce-
ment Counsel managers, in consultation with the Director of OWPE,
will select the lead Agency attorney for the case.
Although a Regional Counsel attorney will usually be designated
as the lead Agency attorney, in cases of national significance or
which may be precedent-setting an attorney from OEC-Waste may be
selected. The extent of Headquarters involvement will be decided
on a case-by-case basis by the Assistant Administrator for Enforce-
ment, (or the Special Counsel for Enforcement until the Assistant
•
Administrator position is established). The Department of Justice
should also be consulted and invited to participate in negotiations
of cases which are likely to result in a consent decree or litigation,
particularly in multiparty and complex cases*.
The Team's lead attorney will be responsible for conducting
cost recovery negotiations. Although the attorney is primarily
responsible for explaining and defending the Team's position during
negotiations, he or she may request other Team members' assistance
in articulating the Team's position to opposing parties.
At the initial negotiation session, the lead attorney should
inform opposing parties that while the Team has authority to negotiate,
any agreements are subject to the approval of Enforcement Counsel and
OSWER. The opposing parties should also be advised that the Agency
has established a deadline for settlement. The deadline should be
disclosed tc tne responsible parties. After the deadline, the
Agency will take judicial action.
31
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2. Form of Settlement Agreement
CERCLA allows the Agency several ways the Agency could
settle a cost recovery action:
0 a consent decree
0 an administrative order
0 a memorandum of agreement.
However, as a matter of policy, the Agency has decided that a
consent decree is required in most cases. A forthcoming policy
will set out the requirements for using consent decrees and another
one will address administrative orders.
Again, it should be pointed out that the negotiating Team
is not authorized to enter into a binding agreement of any type
with the responsible parties in the absence of specific authori-
zation from the Enforcement Counsel and OSWER. Consent decrees
must also be approved by the Department of Justice and the reviewing
court (after a thirty day public comment period). A. draft of any
document which is to be the subject of negotiation should, of
course, be reviewed before commencement of negotiations by appropriate
supervisors of the negotiating Team at the Region and Headquarters,
and any document which the negotiating Team and their supervisors
believe to be acceptable for settlement should, be forwarded to the
Assistant Administrator for Enforcement, the Director of OWPE and
the Department of Justice at the earliest possible time to allow for
adequate review.
The Agency may allow some settlements in which the responsible
party agrees to pay the claim in periodic payments where the party
is unable to pay in a lump sum, or where there is.other legitimate
reason for delayed payment. Before considering installment payments,
32
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however, the Economic Analysis Division of the Office of Policy
and Resource Management (FTS 382-2764) and the Financial Management
Division of the Office of Administration (FTS 382-5135) should be
consulted in order to obtain a review of the financial condition
of the responsible party and to determine any applicable interest
charges.
Payment of cost recovery claims should be made payable to the
U. S. Environmental Protection Agency and should be mailed to:
U.S. Environmental Protection Agency
Accounting Operations Office
P.O. Box 2971
Washington, D.C. 20013
A'ttn: Collection Officer for Superfund
The check .or other form of payment should specify the name of
the site at which the activity took place. The lead attorney is
responsible for furnishing copies of judgments, decrees or agreements
for payment of cost recovery claims as early as possible to Financial
Reports and Analysis, fcoom 3617M, U.S. EPA, 401 M Street, Washington,
D.C. 20460, for establishment of a proper account.
F. Procedure in Event of No Response to Demand Letter
If no response is received to the demand letter, a final
determination must be made of whether the facts of the case justify
the Agency taking further steps to pursue the'cost recovery claim.
A decision whether the case should be referred to DOJ should be
made by the Region as well as staff at Headquarters at the time
the demand letter is drafted. This decision will initially be
made by the Regional Administrator, based on the recommendation of
the Regional Superfund Office and the Regional Counsel.
33
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Relevant factors to consider include:
(a) the strength of evidence connecting the potential defen-
dant(s);
(b) the availablility and merit of any defense. Possible
defenses under Section 107 of CERCLA are generally that
the release and consequent response action was the result
of:
(1) an act of God;
(2) an act of war; or
(3) an act or omission by an unrelated third party as
to whom the owner/operator had no contractual relations
and did not fail to exercise appropriate care against
the foreseeable acts and omissions of that third party.
(c) the quality of release, remedy and expenditure documentation
by the Agency, a state or third party;
(d) the financial ability of the potential defendant(s) to
satisfy a judgment for the amount of the claim or to pay
a substantial portion of the claim in settlement; and
(e) the statute of limitations.
-x
In considering the ability of the potentially responsible
party or parties to pay, the Regional Offices should make use of
the Financial Assessment System, developed by the Economic Analysis
Division of the Office of Policy and Resource Management and
managed by MEIC, to assess the financial condition 'of most
potentially responsible parties.
The determination of the Regional Administrator to initiate
a cost recovery action shall be forwarded by a memorandum from
the Regional Administrator to the Assistant Administrator for
Enforcement for concurrence in the same manner as the referral of
other matters for litigation. A decision not to initiate a cost
recovery action must be reflected in a memorandum to OWPE. An
34
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-29-
affirmative decision must be made by the Regional Administrator _in
each case in which CERCLA funds are expended, whether that decision
be to proceed or not to proceed. This is necessary because of the
Agency's accountability for management of the Fund.
After OEC concurs on pursuing the cost recovery action,
OEC refers the case to the Department of Justice, together with
the names of the appropriate Headquarters and Regional personnel
who will be involved in the case. If the Department of Justice
fails to concur, the originating Regional office is advised of such
non-concurrence, together with the reasons therefor, and recommend-
ations as to whether additional information should be provided for
DOJ's reconsideration. Even though a Region may recommend against
pursuing a cost recovery action, the Assistant Administrator for
OSWER may decide on his own initiative that such an action is
warranted. This recommendation would then be sent to OEC for
consideration.
G. Maintenance and Coordination of Evidence in Event of Referral
There will inevitably be logistical difficulties in maintaining
and coordinating the production of the mass of data, contracts,
cost records, and other evidence generated in a response activity.
It is very important to provide for an orderly method of expeditiously
providing that information during the course of a cost recovery
action for use during case development, discovery, and trial.
35
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Each Agencyr office, contractor or other person participating
in a CERCLA response activity should maintain documents related to
the activity for a period of not less than six (6) years after
all response activities are finished (consult Appendix C for a
list of these necessary documents).15/
The Agency's Financial Management Division will maintain
and periodically update the cost expenditure tracking system for
each site referred to above, so that an itemization of all costs
attributable to a particular site can be quickly obtained. When
a determination is made that a case should be referred to the
Department of Justice for filing (or, if necessary, during the
time that the demand letter is being prepared or the case is being
considered for referral), a request can be made of the persons,
firms or agencies involved in a response activity for copies of
its records. At that time, a complete file of all records involved
in the particular case can be compiled and delivered to DOJ, with
copies of the complete file made available to appropriate Regional
and Headquarters legal and technical personnel.
15/ The period of six years is necessary because of the pos-
iTbility that the claim may not accrue upon the first expenditure,
Additionally the litigation may be protracted; documents must
be kept for the term of the litigation.
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V. Note on Purposes and Use of This Memorandum
The policy and procedures set forth herein, and internal
office procedures adopted pursuant hereto, are intended solely
for the guidance of attorneys and other employees of the U.S.
Environmental Protection Agency. They are not intended to nor
do they constitute rule-making by the Agency, and may not be
relied upon to create a right or benefit, substantive or pro-
cedural, enforceable at law or in equity, by any person. The
Agency may take any action at variance with the policies or
procedures contained in this memorandum, or which are not in
compliance with internal office procedures that may be adopted
pursuant to these materials.
We trust that this memorandum generally covers the subject
of procedures to be involved in cost recovery actions under
CERCLA, but if you have any questions or problems involving this
subject matter, please call Russell B. Selman, Office of Legal
and Enforcement Policy, at FTS 426-7503.
37
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Appendix A
Costs Recoverable Under CERCLA
In order to identify records which must be developed and
maintained for a cost recovery action, it is essential to,know
those costs which may be recovered from a responsible party.
Various sections of CERCLA provide for recovery of certain elements
of costs expended for site clean-up. We have attempted below to
compile a list of those costs which are recoverable, and the
sections of CERCLA which authorize recovery of those costs.
This list is very general and not exclusive.
The listed costs are in general categories, using language
directly from CERCLA, and a determination will necessarily have
to be made in each case whether a particular expenditure is
within the categories of recoverable costs. In this regard, EPA's
position is that the intent of Congress was to authorize recovery
of all costs directly related to clean-up of a site, and therefore
the costs should be broadly construed to fall within these cate-
gories.
Cost CERCLA Section
1. Investigations, monitoring, surveys, SSl04(b), 107(a) (1)(4)(A)
testing, and other information-gathering (providing for recovery
necessary or appropriate to identify the of costs for removal
existence and extent of the release or actions, which, as
threat thereof, the source and nature defined in $101(23)
of the hazardous substances, pollutants include actions taken.
or contaminants involved, and the extent under «104(b)).
of danger to the public health, welfare
or the environment.
2. Planning, legal, fiscal, economic Same
engineering, architectural, and
other studies or investigations
38
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Appendix A
-ii-
necessary or appropriate to plan
and direct response actions.
3. Planning, legal, fiscal, economic, same
engineering, architectural and
other services necessary to recover
the cost of response actions.
4. Planning, legal, fiscal, economic, same
engineering, architectural and
other services necessary to enforce
the provisions of the Act (CERCLA).
(This could include costs incurred
in prosecuting an immiment endanger-
ment action under $106).
5. All costs of (A) removal and (B) §107(a)(4)(A)
remedial action incurred by the U.S.
Government or a State not inconsis-
tent with the NCP. Actions for which
such costs may be incurred are-
(A) Removal Actions ($101(23)):
(1) the clean-up or removal of
released hazardous substances
from the environment;
(2) such actions as may be
necessary taken in the event
of the threat of release of
hazardous substances into the
environment;
(3) such actions as may be necessary
to monitor, assess or evaluate
the release or threat of release;
(4) the disposal of removed material;
(5) such other actions as may be
necessary to prevent, minimize or
mitigate damage to public health,
welfare or the environment which
may otherwise result from a
release;
(6) any monitoring to assure actions performed
by other parties adquately protect public
health, welfare and the environment, and
meet EPA criteria;
39
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Appendix A
-iii-
(7) specific examples contained in
$101(23) (without limitation):
a. security fencing or other
measures to limit access;
b. provision of alternative
water supplies;
c. temporary evacuation and housing
of .threatened individuals
d. action taken under 5104(b) of
CERCLA;
e. any emergency assistance provided
under the Disaster Relief Act of
1974.
(B) Remedial Actions ($101(24)):
(1) actions consistent with permanent
remedy taken instead of or in
addition to removal actions, to
prevent or minimize the release
of hazardous substances into the
environment so that they do not
migrate to cause substantial danger
to present or future public health,
welfare or the environment.
(2) Specific examples contained in $101(24) (without
limitation):
(a) storage;
(b) confinement
(c) perimeter protection using
dikes, trenches or ditches;
(d) clay cover;
(e) neutralization;
(f) cleanup of released hazardous
substances or contaminated
materials;
(g) recycling or reuse;
40
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Appendix A
-iv-
(h) diversion;
(i) destruction;
(j) segregation of reactive wastes
(k) dredging or excavation;
(1) repair or replacement of
leaking containers;
(m) collection of leachate and runoff;
(n) on-site treatment or incineration;
(o) provision of alternative water
supplies;
(p) any monitoring reasonably required
to assure that such actions protect
public health, welfare and the
environment;
(q) ' costs of permanent relocation of
residents, businesses and community
facilities (where relocation, alone
or in combination with other factors,
is more cost-effective than and
environmentally preferably to trans-
portation, storage, treatment or
disposal off-site of the hazardous
substances).
(3) Remedial actions do not include:
(a) off-site transportation of hazardous
substances;
(b) off-site storage, treatment or
disposal of hazardous substances;
unless it is determined that such actions are
(A) more cost-effective than other remedial
actions; (B) will create new capacity to manage
(in compliance with Subtitle C of RCRA) hazardous
substances in addition to those at the affected
site; or (C) are necessary to protect public
health, welfare or the environment from a present
or potential risk which may be created by further
exposure to the continued presence of the
hazardous substances.
41
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Appendix A
-v-
6. Any other necessary costs of response Sl07(a)(4)(B)
incurred by any other person consis-
tent with the NCP. "Response" actions
include both "removal" and "remedial"
actions (5101(25). (See list of
removal and remedial actions above.)
7. Damages for injury to, destruction of, Sl07(a)(4)(C)
or loss of natural resources, including
the reasonable cost of assessing such
injury destruction or loss. (See note,
below)
"Natural resources" include (5101(16)):
(a) land;
(b) fish;
(c) wildlife;
(d) biota;
(e)- air;
(f) water?
(g) groundwater;
(h) drinking water supplies;
(i) other such resources belonging
to, managed by, held in trust"
by, appertaining to, or otherwise
controlled by the United States,
any state or local government, or
any foreign government (includes
resources of the Fishery Conser-
vation and Management Act of 1976).
NOTE: CERCLA $301(c) provides for the promulgation of regulations
not later than two years after enactment of the Act for the
assessment of damages for injury to destruction of or loss of
natural resources resulting from a release of a hazardous
substance. See footnote 3 in the Memorandum for further
explanation on recovery of these damages.
42
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Appendix B
(Model Demand Letter)
XYZ Corp.
Someplace, State 00000
Re: Name, location of site
Dear Sir or Madam:
On or about , 198_, there were
releases and threatened releases into the environment of
hazardous substances [and pollutants and contaminants] from
the facility located at or about .
[In addition, there were releases and threatened releases of
pollutants and contaminants that may present an imminent and
substantial danger to the public health or welfare.]
[On or about , 19 , EPA gave [oral] notice
to you [which was confirmed] by letter of
, 19^_, advising you regarding the referenced
facility and that you are a party who may be liable for money
expended by the government to take corrective action at the
facility. EPA offered you the opportunity to discuss with EPA
your voluntarily taking action necessary to abate any releases
or threats of releases of hazardous substances [and polluants
and contaminants] from the facility. You did not undertake
the necessary actions.]
In accordance with the Comprehensive Environmental
Response, Compensation and Liability Act (CERCLA), 42 U.S.C.
§9601 et seq., [and other authorities (insert where pre CERCLA
or non CERCLA expenditures)] the [State of _^ , pursuant
to an agreement with and funding by the (insert if State lead)]
United States Environmental Protection Agency (EPA undertook
response action using funds provided for such actions. The
action began on or about and continued to on
or about . EPA's response action entailed
the (describe generally what was done).
The cost of the response action [performed] [caused
to be performed by EPA at the facility] [was] [is currently]
approximately $ . (Insert the amount obligated
by the Agency to be expended on the site, not the amount
actually expended according to Agency records.) [The Agency
anticipates expending additional funds in the future under
authority of CERCLA for additional response activity which the
Agency deems appropriate to be performed at the site.] Enclosed
is a statement summarizing the expenditures to date.
43
-------
- 2 -
Information available to EPA indicates among other
things that you (choose one or more, of the bracketed clauses
as appropriate:) [are/were at the time of the response
action the owner/operator of the facility] [were the owner/
operator of the facility at the time of disposal of hazardous
substances at the facility] [did, by contract, agreement or
otherwise, arrange for disposal or treatment, or arranged for
transport for disposal or treatment of hazardous substances
[and pollutants and contaminants]at the facility [accepted
hazardous substances [and pollutants and contaminants] for
transport to the facility which was selected by you]. Pursuant
to the provisions of Section 107(a) of CERCLA [and other author-
ities (insert where pollutants or contaminants involved and
Where other law involved)], we believe that you are liable for
the payment of all costs expended on the site to the Hazardous
Substance Response Trust Fund established pursuant to Section
221 of CERCLA, which is administered by EPA.
We hereby request that you [or a group of parties
potentially responsible for the site] make restitution by pay-
ment of the herein stated amount plus interest [together with
any sums hereafter expended by the Agency on the site pursuant
to authority of CERCLA]. [The names of other potentially
responsible parties receiving this request for payment are
enclosed with this letter to facilitate organization among
the identified parties concerning payment.] If you [or an
organized group of potentially responsible parties] desire to
discuss your liability with EPA, please contact the person
named below in writing not later than thirty (30) days after
the, date of this letter. We will otherwise assume that you
have declined to reimburse the Fund for the site expenditures
and will subsequently pursue civil litigation against you.
Sincerely,
Contact Person:
[Name]
[Title]
[Address]
cc:: Enforcement Counsel
Regional Counsel
State Agency
44
-------
Appendix C
The following pages constitute a search guide that may be used by the
»
Regional enforcement program in gathering documentation to support a cost
recovery action. The search guide format is a chart with four columns, headed
as follows: •Document", "^iginator", "EPA Contact" and "Regional File
location'.* All of the documents listed will probably not be available in all
cases, nor will each one necessarily enhance the body of evidence in every case.
It must be decided on a case-by-case basis exactly which pieces of documentation
should be used as supporting evidence. The search guide was meant to be an
exhaustive list of documents that should be considered. It is suggested that
.the persons conducting the file search for supporting documentation pull out
each document on the list if it is available. It can be decided at a later tine
which of the documents are useful as evidence given the facts of the particular
Please note that the search guide covers only documents that would be
useful in supporting the first three elements of proof discussed in this
guidance: proof of the release, link between the party and the site and
consistency with the NCP. Cost documentation will be the subject of another
guidance document that is currently under development.
* The fourth column, "Regional File Location", has meaning only if the Region
uses the filing system described in Appendix E.
45
-------
I. Evidence of a Release or the Throat of a Release
Docunent
• Notification Record
pursuant to Sec.
103(a) of CERCLA
• Notification Racottl
pursuant to Sec. 103(c)
of CERCLA
• Record of notification
of EPA-IQ-Bnetgency
Response Division,
EPA Regional
Administrator or
other EPA official
• Ccnpliance
Investigation
Report pursuant to
Section 104(e) of
CERCLA
• other Compliance
, Investigation or
Inspection/Audit
Reports pursuant
to statutory
authority (e.g.,
sec. 3013 of RCRA)
Originator
Owner/Operator
of facility
Gov't. officials
responding to the
problem (Local,
State or Federal)
Owner/operator of
facility
Appropriate Fed.
officials
Federal/State
investigator
Federal/State
investigator
EPA Contact
• National Response
Center (NRC)
EPA-Ragions
EPA-HQ-Hazardous
Site Control Division
EPA-Reglon, O8C
EPA-R.A.
EPA-HQ-Emergency
Responsible Division
' EPA-Region, CERCLA
Enf./Compliance
Project Manager
• State Enforcement/
Compliance Agency
' EPA-Region, Approp.
Enf./Ocmpliance
Section
• State Enforcement/
Compliance Agency
Probable Pile Location*
• NCR (see page 21, 11,
bullet II)
• Remedial Response t
Discovery/Hazard
Ranking Pile/Regions/
HO
• NRC
• EPA-HQ-Bimgency Response
Division Removal Response
Pile
• Remedial Responses
Discovery/Hazard
Ranking File
• Remedial Responsei
Discovery/Hazard
Ranking File
•unless otherwise noted, this assumes the documents are located in the Regional f iies
and assumes the Regions ate using the file structure outlined in Appendix E.
-------
-2-
I. Evidence of a Release or the Threat off a Release (continued)
Document
Originator
EPA Contact
Probable File Location
Notes f torn phone
calls, correspondence,
photographs, or other
form of random or
incidental observation
Signed witness state-
ments (describing the
conditions leading
up to the release
and the release)
Gov't. Officials
(Local, State,
Federal)
public
Owner/Operator
Facility
Employees or
Contractor* assoc.
w/ facility
Federal/State
. nvestigators
Local officials
public
EPA-Rsgion, Enf./
Oompl lance project
Manager
State Enf./
Oompliance Agency
Municipal Government
Offece (e.g.. Public
Health or Police Dept.)
EPA-Region, Haste Mgt.
Division Proj. Manager
State Agency
Remedial Response s
Discovery/ Hazard
Ranking File
Remedial Responses
Discovery/ Hazatd
Ranking File
-------
I. Evidence of a Release or the Threat of a Release (continued)
Document
• Photographs, drawings
depicting site condi-
tions.
00
Naps and photographs
(including aerial
imagery and other
remote sensing
techniques)
Documents relating to
the physical lay-out
of the facility (e.g.,
blueprints, pipe loca-
tion diagrams, security
provisions, monitoring
well locations, etc.)
Documents relating
to procedures, man-
agement practices used
at the facility..
Originator
Owner/Operator or
Employee of Facility
EPA-OSC/Response Team
State-OSC/Response
learn
REH/FIT Contractors
bocal Officials
public
EPA-NEIC
EPA Environmental
photographic Inter-
pretation Center -
Warrenton, Va.
Owner/Operator of
the Facility
• Owner/Operator
of the Facility
• Employees of the
Facility
EPA Contact
' EPA-Regicn, Waste
Mgt. Division
Project Manager
' State Agency
EPA-Reglon, Waste
Hgt. Division or
Env. Services Div.
project Manager
State Agency
EPA-Reglon, Waste
Mgt. Division or
'Env. Services Div.
Project Manager-
State Agency
• EPA-Region, Waste
4 Mgt. Div. project
Manager
• state Agency
Probable File Location
0 Remedial Responsei
Imagery or Discovery/
Hazard Ranking File
• Remedial Responses
Imagery File
• Remedial Responset
Discovery/Hazard
Ranking File
Remedial Response i
Discovery/Hazard
Ranking File
-------
-4-
I. Evidence off a Release or the Threat of a Release (continued)
Document Originate* EPA Contact
Documents telating to • EPArOGC/Resp. Team
test results (e.g.* Clash • State-OGC/Response
point) and multi-media Team
environmental sampling • RBVFIT Contractor
and analysis • Laboratory
vo
•• Documentation of
information used
to determine
sampling locations*
frequency and types
(water, soil, ait,
wildlife, leachate,
hazardous wastes
fran containers
*• Summary charts or
interpretive reports
regarding the analy-
tical data.
10 Affidavits prepared
by field and labor-
atory staff indica-
ting all procedures
and protocols fol-
lowed (including
health and safety
consideration)
• EPA-OGC/Resp. Team
• State-OGC/Response
leans
• REM/FIT Contractor
• Laboratory
• Same as above
• EPA-Ragional Tech.
• Staff
• State Agency Tech.
Staff
• Sams as above
EPA-Regton, Waste
Ngt. Divtsion/Env.
Services Division
Project Manager
EPA-Region, Waste
Mgt. Division/Env.
Services Division
Project Manager
Same as above
0 Same as above
Probable File Location
• Remedial Responset
Discovery/ Hazard
Ranking Pile
• Remedial Responset
Discovery/ Hazard
Ranking Pile
Sane as above
Same as above
-------
-5-
I. Evidence of a Release or the Threat of a Release (continued)
Document
•• Docunents relating
to Evidence Audits
by Contractor-
Evidence Audit Teams
(CEAT)
•• Chain of Custody
Documents
• Docunents relating
to topographic,
hydrgeological,
ecological or
demographic
information in
the vicinity of
the facility
(e.g., studies,
reports, articles,
field observation
notes)
Originator
•NEIC
EPA Contact
Same as above
Probable File Location
• Regional office
Piles
• owner/Operator of
the Facility
• Local/State Agencies
(e.g.. Housing or
Transportation Auth-
ority, Planning
Oonmission)
• Federal Agencies
(e.g.. Heather
Bureau, USGS,
Soil Conservation
Service, NCAA, DOT,
Army Corps of
Engineers, Coast
Guard, etc.)
• Local librariees
• Local Universities/
•Colleges
• Public
• Federal/State/Local
Officials or Investi-
gators
• REK/FIT Zone
Contractor
• EPA or State OSC
• EPA-Region, Waste
Mgt. Division or
Env. Services Div.
Project Manager
• State Agency
Remedial Responset
Discovery/Hazard
Ranking Pile
-------
Ul
I. Evidence of a Release or the Threat off a Release (continued)
EPA Contact
• Sane as above
Document
00 Documentation of
physical character-
istics of each
geological strata
through fiels or
00 Documentation
of physical
characteristics
of ea. geological
strata through
field or lab
testing (e.g.,
permeability, head
measurements
Originator
• Same as above
• 0
Documentation
supporting ground-
water and surface
water flow estimates
(rates and ditections)
00 Documentation of
non-drilling
investigative
techniques
(e.g., resistivity
or seismic surveys)
i
00 Well logs and descrip-
tions of geological
strata
• Sane as previous • Sane as previous
page page
Same as above
Sane as above
Sane as above
Sane as. above
• EPA-OSC/Response
Team
• State-OSC Response
Team
• REH/FIT Contractor
EPA-Region, Haste
Mgt. Div. or- Env.
Services Div.
Project Manager
State Agency
Probable File Location
• Sane as above
Sane as previous
page
Sane as above
Same as above
0 Remedial Response:
Discovery/Hazard
Ranking File
-------
-7-
I. Evidence of a Release or the Threat off a Release (continued)
Document
Originator
EPA Contact
Probable Pile Location
Ul
to
Hydiogeologleal
Data and Reports
EPA-OSC/Response
Team
State-OGC/Response
Team
Contractor
EPA-Region, Haste Manage-
ment Division or Environ-
mental Service Division
Project Manager
State Agency
• Remedial Response i
Discovery/hazatd
Ranking Pile
00 Documentation of
information used
to determine types
of data needed
Notification Record
pursuant to permit
requirements or
other statutory*
authority
EPA-OSC/Response
Team
State-OSC/Response
Team
Contractor
Owner/Operator of
facility
EPA-Region, Waste Manage-
ment Division or Environ-
mental Service Division
Project Manager-
State Agency
• EPA-Region^ Appropriate
Enfotoement/Gompliance
Section
• State Permitting Agency
Remedial Responses
Discovery/Hazard
Ranking Pile
Remedial Responset
Discovery/Hazard
Ranking Pile
EPA-Regions
-------
-8-
I. Evidence of a Release or the Threat of a Release (continued)
Document
Originator
EPA Contact
Probable File Location
en
CO
0 Routine sampling and
analysis data (e.g.
performed to analyze
wastes, to assure
statutory compliance
such as NPDES permit).
Data should include
all field notes,
chain of custody
documents, laboratory
procedures/protocols,
raw data and summaries
of or interpretative
reports about the
raw data.
• Documentation of
potential health
or environmental
effects resulting
from release (e.g.,
interviews, physicians'
statements
• Biological Inventory
of the Affected area
• Owner/Operator of
the facility
• Generator
• Transporter
• Contract Laboratory
• Public
• physicians
• Local Health
Officials
• Local Environmental
Officials
• EPA-OSC/Response
learn
• State-OSC/Rasponse
learn
• REM/FIT Contractor
• EPA-Ragion, Approp.
EnC./Compliance
Section
• State Enf./
Compliance Agency
EPA-Ragion, Haste
Mgt. Div. Project
Manager
State Agency
EPA-Ragion, Haste
Mgt. Div. or Env.
Services Div.
Project Manager-
State Agency
• Remedial Response)
Discovery/Hazard
Ranking Pile
Remedial Response:
Discovery/Hazard
Ranking Pile
• Remedial Responses
Discovery/Hazard
Ranking File
-------
in
I. Evidence off a Release or the Threat of a Release (continued)
Document Originator EPA Contact
Literature searches
and periodicals
regarding
the toxicology
and chemical
ptopetties
of the
hazardous
substances
(e.g.. Toxicology
Data Bank (TIB)
ot Chemical
Information
System (CIS)
List of hazardous
substances (e.g.*
CERCLA Sec. 102, Oft
Sec. 311, RCRA Sec.
3001, CWV Sec. 307,
CM Sec. 112, TSCA
Sec. 7)
' Hazard Ranking
Form and
supporting
documents
public comments
or record of
public hearing
regarding
Hazard Ranking
• EPA-Research
Labs
NEIC
EPA-HQ, OWPE
or OERR
State Agency
Probable Pile Location
• EPA-HO-Management
Information and Data
Systems Division
EPA-HQ Library
State Agencies
or Libraries
universities
Research
or Consulting
Firms
• May 25, 1983
or 40 CFR 302.
• EPA-HO-Bnergency
Response Division
EPA-HQ-Docket 102 RQ.
• EPA-Region, Regional
Site Project Officer
• EPA-Region, Haste
Management Division
project Manager
• Public
• EPA-Region, RSPO
• EPA-HO-OERR
• EPA-Region, RSPO
Remedial Responses
Discovery/Hazard
Ranking Pile
Remedial Responses
Discovery/Hazard
Ranking Pile
-------
-10-
I. Evidence of a ft?lease or the Threat of a Release (continued)
U1
ui
Docunent
Documents relating
to any insurance
coverage carried
by facility
• documents relating
to any prior legal
actions(e.g.,
complaints, discovery
documents, court
Older, settlement
agreements,
negotiation records)
• Documents telating
to prior accidents
(e.g., fites,
explosions) or
medical problems
experienced by
employees
Originator
Owner/Operator of
a Facility
Insurance Agent
• Counsel for Owner/
Operator of Facility
• Regional Counsel
• EPA-HQ, OLBC
• U.S. Department of
Justice
• State Attorney Gene-
ral's office or
State Agency Counsel's
Office
• Owner/Operator of
a Facility
• Local public Health
Agency
• Local Police or Pice
Departments
* Employees of a
Facility
EPA Contact
EPA-Region, Haste
Mgt. Division
Project Manager
State Agency
• EPA-HQ, OLBC
• Regional Enf.
Counsel
• State Attorney
General's office
Probable File Location
• Remedial Responses
Discovery/Hazard
Ranking File
• Remedial Responses
Discovery/Hazard
Ranking File or
Enforcement File
EPA-Region, Waste
Mgt. Division
Project Manager-
State Agency
• Remedial Responses
Discovery/hazardd
Ranking File
-------
-11-
II. Evident* Linking Responsible parties to the Site
A. Owners and Operators
m
CTi
Document
Deed, Title History,
Mortgage or Lien
Information on
property
permits held by a
facility (e.g.,
NPDES, RCRA,
building construction)
• Manifests or other
business records
(e.g., bills of
lading, contract
documents with
haulers, inventory
records) which
provide information
on quantity and
type of substance
• tease
Originator
• Owner/Operator of
Facility
• Title Search Company
• City or County Record
Office
• Bank of Lending
Institution
• Owner/Operator of
facility
• EPA-Region Enforce-
ment/Ooropliance
Section
• State Petroitting
Agency
• Owner/Operator of
the Facility
' Transporter
'• Generator
• Owner of Property
• Operator of Facility
EPA Contact
• EPA-Ragion, Haste Manage-
ment Division Project
Manager
• State Agency
• EPA Regional Counsel
• EPA Regional Counsel
• EPA-Region, Appropriate
Enforcement/Compliance
Section
• State Permitting Agency
• EPA-HQ, OSW
* EPA-Region, Waste Management
Division Project
Manager
• State office responsible
for manifests
• EPA-Ragion, Haste Management
Division Project Manager
• state Agency
• EPA Regional Counsel
Probable File Location
Remedial Response t
Discovery/Hazard
Ranking File or
Enforcement File
• Remedial Response i
Discovery/Hazard Ranking
File or Enforcement File
•Remedial Responses
Discovery/Hazard Ranking
File or Enforcement File
' Remedial Response t
Discovery/Hazard
Ranking File or
Enforcement File
-------
-12-
ui
II. Evidence Linking Responsible Patties to the Site (continued)
A. Owners and Operators (continued)
Document Originator EPA Contact
Corporate structure
records (e.g., annual
reports, Dun t Brad-
street leports, in-
corporation docu-
ments)
• NBIC Computer Flies
(SBC and Dun 6
Bradstreet Reports
• Owner/Operator of
Facility
• Industrial director-
ies, manuals, etc.
• Corporate Divisions
of State Secretary
of State Offices
• Small Business
Administration
• vehicle identification
information or
equipment tental
documents (e.g.,
license or registration
records, contracts or
lease agreements)
Recotde or other
documents found
at the facility
during an
investigation
(e.g., utility
recotds, tax
receipts or
certificates,
teal estate
records, labels
on containers)
• EPA-Region, Waste Manage-
ment Division Project
Manager
• State Agency
• EPA-Regional Counsel
Probable Pi* a Location
• Remedial Responset Disccv
Hazard Ranking Pile or
Enforcement Pile
Motor vehicle Bureau
Rental businesses
Vehicle Owner/Trans-
porter
local truckstcps
Owner/Operator or
Employees of a
Facility
" £3/"Region, Waste Manage
went Division Project
Manager
0 State Agency
• EPA-Regional Counsel
• Remedial Response t
Discovery/Hazard
Ranking Pile or
Enforcement File
EPA-OSC/Response Team • EPA-Region,Waste Manage-
State-OGC/Response • ment Division Project Manager
Tvam • state Agency
Federal or State • EPA-Regional Counsel
Investigators
RE^/FIT Contractors
Remedial Response:
Discovery/Hazard Ranking
File or Enforcement Pile
-------
Ol
00
II. fcVittence Linking Responsible Patties to the Site (continued)
A. Owners and Operators (continued)
Document
Incident Reports
(e.g.. Cites,
explosions)
Interviews, affidavits
or signed statements
by poisons with know-
ledge regarding past
activities at the
site
Interview notes from
discussions with
persons who ate
knowledgeable
about past site
activities
such as employees,
local officials,
residents of
the atea, local
industries, etc.
Historical' information
documenting period of
activities at the site
Administrative infor-
mation requests and
responses under
RCRA $3007 and CEROA
S104
Originator
fire
local police or
departments
Owner/Operator or
Employee of a Facility
• Past Employees of
Facility
• Local Officials or
Residents
• Other Persons
• EPArOGC/Response Team
• Other Federal or
State Investigators
• State-OSC/Response Team
• RD4/FIT Contractors
EPA Contact
• EPA-Region, Waste Manage-
ment Division Project
Manager
• State Agency
• EPA-Regional Counsel
• EPA-fO-Bu&gancy Response
Division
• EPA-Hp-Bnergency Response
Division
* £Pft-Reglonal Haste Manage-
msnt Division Project
Onager
* EPA-Ragional Counsel
• State Agency
EPA-Regionf Waste Manage-
ment Division ptoject
Manager-
State Agency
EPA-Regicnal Counsel
probable File location
• EPA-HQ-Emergency Response
Division/Removal
Response File
• NCR
• Remedial Responses
Discovery/Hazard
Ranking File or
Enforcement File
• Remedial Responses
Discovery/Hazard
Ranking or Enforce-
ment File
-------
-14-
vo
II. Evidence Linking Responsible parties to the Site (continued)
B. Generators (continued)
Document
• Shipping documents,
manifests or other
business records
(e.g., bills of
lading, vouchers,
contracts with
haulers) which
provide -
information
on responsible
patties
• Affidavits or
signed statements
by persons
with knowledge
regarding past
activities at
the site
0 Records or other
documents found
at the facility
during an
investigation
(e.g., utility
records, ta*x
receipts or
certificates, real
estate records,
labels on
containers)
Originator
• Owner/Operator of
Facility
• Generator
• Transporter
• Past Biployees of
Facility
• Local Officials or
Residents
• Other Persons
• EPA-OSC/Response Tea
• State-OSC/Response
Team
• Federal or State
Investigators
• REM/FIT Contractors
EPA Oontact
• EPA-HQ, OSW
• EPA-Reglon, Waste Manage-
ment Division Project
Manager
• State Office responsible
for manifests
• EPA-Ragional Counsel
Probable File location
• Remdial Response: Discovery/
Hazard Ranking File or
Enforcement
0 EPA-Ragicn, Haste Manage-
ment Division Project
Manager
• EPA-Regional Counsel
• State Agency
• EPA-Region, Waste Manage-
ment Division Project Manager
• State Agency
* EPA-Ragional Counsel
Remedial Response: Discovery/
Hazard Ranking File or
Enforcement File
Remedial Response: Discovery/
Hazard Ranking File or
Enforcement File
-------
-15-
II. Evidence Linking Responsible Patties to the Site (continued)
B. Generators (continued)
Document
Interview notes
from discussions
with persons
who ate knowlegeable
about past site
activities
such as employees,
local officials,
residents of the
atea, local
industries, etc.
Originator
• EPA-OSC/Response Team
• Other Federal or
State Investigators
• State-OSC/Response
Team
• REM/FIT Contractors
EPA Contact
• EPA-Region, Waste Manage-
ment Division Project
manager
• State Agency
• EPA-Reglonal Counsel
Probable File location
• Remedial Response: Discovery/
Hazard Ranking File or
Enforcement File
photographs
documenting
activities at
the site
• Corporate structure
records (e.g.,
annual reports,' SBC
reports, Dun &
Bradstteet reports,
incorporation
documents)
NEIC Computer Piles
(SBC and Dun t
Bradstteet Reports)
Owner/Operator of
Facility
Industrial director-
ies, manuals, etc.
Ooporate Divisions
of State Secreetary
of State Offices
Small Business
fttainisttation
EPA-Region, Haste Manage-
ment Division Project
Manager-
State Agency
EPA-R9gional Counsel
Remedial Responset Discovery
Hazard Ranking File or
Enforcement File
-------
-16-
a\
II. Evidence Linking Responsible Patties to the Site (continued)
B. Generators (continued)
Document Originator Hft Contact
Documents relating
to sampling and analysis
which indicate wastes
found at a facility are
of the same nature as
responsible patty's
wastes
pEobable File location
• Documents found
during remedial
activities
relating to the
identification
of responsible
parties
(e.g., labels,
cartons, records)
• EPA-OSC/Response lean
• RBV'FIT Contractor
• Project Contractor
EPA-tegion, RSPO
• Remedial Responses
Remedial Implementation
File
-------
-17-
II. Evidence Linking Responsible patties to the Site (continued)
C. Transporters
Document Originator EPA Contact
Probable Pile location
Manifests, shipping • Owner/Operator
to
documents or other
business documents •
(e.g., bills of •
lading, vouchers,
contracts with haulers)
which provide info.
on responsible patties
• Records or other
documents found
at the faciulity
during an
investigation
(e.g., bills
utility records,
tax receipts or
certificates, real
estate record,
labels on
contains ts)
• Interview notes
ficre discussions
with persons* who
are knowlegeable
about past site
activities such
as employees,
local officials,
Residents of
the area)
Facility
Generator
Transporter
EPA-OSC/Response Team
State-OSC/Response
Federal or State
Investigators
REH/FIT Contractors
EPA-OSC/Response Team
Other Federal or
State Investigators
State-CISC/Response
Team
R94/FIT Contractors
• Remedial Response i Discov-
ery/Hazard Ranking or
Enforcement File
EPA-HQ, OSH
EPA-Region, Waste Manage-
ment Division Project
Manager
State Office responsible
for manifests
EPA~Regional Counsel
EPA-Reglon, Haste Manage- * Remedial Responses Discov-
ment Division ptoject Manager ery/Hazard Ranking c*
State Agency
' EPA-Regional Counsel
Bnfotxjement File
Haste Manage-
c*-«-i«yi«i, !*»«* rw.^yo- • Remedial Responses Discov-
ment Division Ptoject Manager ery/Hazard Ranking or
State Agency Enforcement File .
EPA-Regional Counsel
-------
-18-
II. Evidence Linking Responsible Patties to the Site (continued)
C. Transporters (continued)
Document
Originator
EPA Contact
Probable Pile Location
0 Affidavits ot
signed statements
by persons with
knowledge regarding
past activities at
the site
• Past Employees of
Facility
• local Officials or
Residents
• Other Persons
EPA-Region, Waste Manage-
ment Division Project Manager
State Agency
EPA-Ragional Counsel
Remedial Responsei Discov-
ery/Hazard Ranking or
Enforcement Pile
en
u>
Vehicle
identification
information or
equipment rental
documents (e.g.*
license of
teg 1st rat ion
records,
contracts
or lease
agreements)
Photographs
documenting
activities at
the site '
Motor vehicle
Buieau
Rental businesses
Vehicle Owner
tocal truckstops
Owner/Operator or
Employees of a
Facility
EPA Region, Waste Manage-
ment Division Ptoject
Manager
State Office responsible
for manifests
EPA-Regional Counsel
Remedial Response: Discov-
ety/Hazatd Ranking or
Enforcement Pile
-------
-19-
o\
II. Evidence Unking Responsible Patties to the Site (continued)
C. Transporters
Docunent Originator EF& Contact
Corporate
structure
recofctia (e.g.,
annual reports,
SBC reports.
Dun and
Bradstreet
t«ports,
incotporation
documents
Probable File Location
• NEIC Computer
Piles (SBC and
Dun ft Bradstreet
Reports)
• Owner/Operator of
Facility
• industrial
directories. Manuals,
etc.
• Corporate Divisions
of State Sectetary
of state Offices
• Small Business
Administration
EPA-Region, Haste Manage-
ment Division Project Manager
State Agency
EPA-Ragional Counsel
Responses Discover
Hazard Ranking Pile or
Enforcement Pile
petrol ts held by
a facility (e.g.,
building or
construction i/eimit
or NPDES) wU~ch
contain responsible
party information
Owner/Operator of
Facility
Permitting Agency
(Local, State or
Federal)
• EPA-Raglon, Haste Manage- • Remedial Responses Discovery
ment Division Project Manager Hazard Ranking Pile or
• State Agency Enforcement File
• EPA-Ragional Counsel
-------
-20-
III. sequence of Events, Including Consistency with NCP
A. General
Document
• List of Patties
issued Notice
Letter! s),
dates on which
letters were
issued and copies
of letters
• Response to Notice
Letter(s)
• Correspondence
^ and notes from
01 oral communications
with potential
responsible patty
regarding
negotia-
tions/settlement
Settlement proposals •
and supporting •
documents (e.g., •
technical studies
conducted by
potential responsible
patty)
Settlement Agreements
and supporting doc,
(include internal EPA
approval memos, press
releases, etc.)
Originator
EPA-Regional Counsel
EPA-Reglon, Waste
Management Division
Project Manager
EPA Oontact
Probable File Location
• EPA-Regional Counsel • Remedial Responses Enforce-
ment File
• Potential Responsible • EPA-Reglonal Counsel • Remedial Responses Enforoe-
Patty ment File
• Potential Responsible
Patty
• EPA-Ragional Counsel
EPA-Regional Counsel
Remedial Responses Enfor
ment File
EPA-Regional Counsel
EPA-HQ-OLBC and OWPE
Potential Responsible
Patty
EPA-fO-OLEC and OHPB
EPA-Regional Counsel
Potential Responsible
Patty
EPA-Reglonal Counsel • Remedial Responses Enfor
ment File
EPA-Regional Counsel
• Remedial Responses Enfor
ment File
*ln those cases where pattial settlements are teached with the patties or only acme of the
patties negotiate a settlement.
-------
-21-
HI. Sequence of Events, Including Consistency with NCP (continued)
A. General (continued)
• Summaty of negotiation
sessions, offers and
responses and copies of
all documents and cor-
respondence.
• Documentation of the '
use of expert witnesses • EPA-Reg. Counsel
during negotiations
(expense and time reports)
B. immediate Removals*
• EPA-Reg. Counsel
• Remedial Responses
Enforcement File
1. Response Initiation
Document
Notification Record
pursuant to Sec. 103(a)
or (c) of CERCLA
Racord of notification
of EPA-HQ-ERD or other
appropriate federal
office (e.g., EPA
Regional Administrator,
U.S. Coast Guard)
Originator
• Owner/Operator of facility
• Catrier or other transporter
• Government officials
responding to the problem
(Local, state or Federal
• Appropriate federal official
EPA Contact
National Response
Canter (NRC)
EPA-HO-ERD
EPA-Region, OSC
Probable Pile location
• NRC
• EPA-Region, Removal
Response Pile
• U.S. Coast Guard
district
• Removal Response Pile
* Under certain circumstances, the removal response may be led by the U.S. Coast Guard. Therefore,
the source of the evidence and where it is available from will vary, depending on which entity,
EPA or USOG, has the lead.
-------
-22-
III. sequence off Events, Including Consistency with NCP (oontirmad)
B. immediate Removals (continued)
1. Response Initiation (continued)
Document Originator EPA Contact
Record of Preliminary
assessment and initial
inspection of site (e.g.,
field notes, sampling
data, responsible patty
infounation
EPA-OSC
U.S. Coast Guard
State-OSC
TAT Contractor
• Documentation concerning the
site conditions that necessitated
an immediate temoval and the basis
Cor choosing a particular response
• Documentation of approval • EPA Regional Administrator
• U.S. Coast Guard-
district director
by EPA-Region and
subsequent EPA-HQ-ERD
notification (when HO
approval is not
required)
• Documentation of approval * EPA-HO-Assistant
by EPA-HO-O6WER (when Administrator for- OSWER
HO approval is required) * U.S. Coast Guard district
director*
• EPA-Region, OSC
Probable Pile Location
• Removal Response File
EPA-Region, OSC
EPA-HO-BRD
EPA-HO-OSHER
EPA-Region, OSC
Removal Response Pile
Removal Response File
Record of RRT or NRT
notification, if
appropriate
EPA-OSC
USCG-06C
Regional Response Team
(ROT)
National Response Team
(NRT)
• Removal Response File
-------
oo
-23-
III. Sequence of Events, Including Consistency with NCP (continued)
B. Inroad late Removals (continued)
1. Response Initiation (continued)
Document
• Reootd of the decision
that the immediate
removal action was
completed
• Record of the decision
to exceed the $1 m
or 6-month cutoff, it
applicable
• Record of the decision
as to whether further
action is required at
the site
• Record of US Coast
Guard National Strike
Force (USOG-NSF
notification and
request for
assistance
• Record of ERT
notification and
request for assistance
(e.g., the Environ-
mental Emergency
Response Unit (EBRU)
Originator
• EPA-06C
EPA Contact
•EPA-OSC
EPA-OSC
•EPA-06C
EPA-OSC
EPA-OSC
EPA-OSC
EPA-QGC
• EPA representative of
RRT
• USOQ-OSC
• Buetgency Response lea
(ERT)
• Regional Response Tea*
(RRT)
Probable File Location
• Removal Response Pile
• Removal Response Pile
• Renewal Response Pile
• Renoval Response Pile
• Removal Response Tile
-------
-24-
a\
VD
III. sequence of Events, Including Consistency with NCP (continued)
B. immediate Ranovals (continued)
1. Response initiation (continued)
Document Originator
0 EPA-OSC
EPA Contact
0 Recotd of notification '
of federal agencies (e.g.,
FEMA, HI1S)
0 Initial POLREP (also
known as a 10 Point
document)
2. Contractor Selection
• EPA-OSC
• USCG-OSC
• State-OSC
• TAT Contractor
0 For removals requiring
less than $2500
00 EPA Porm 1900-48, Order • EPA-OSC/Response Team
for Services-Bnergency • TAT Contractor
Response to Hazardous
Substance Release
00 EPA Potra 1900-50,
Justification for
Noncompetit ive
Procurement
(JNCP)
•• EPA Potra 1900-51,
Determination of Price
Reasonableness
• EPA-OSC/Response
TAT Contractor
• EPA-OSC/Response Team
TAT Contractor
• EPA-Region, OSC
0 Appropriate federal
agency
0 EPA-Region, OSC
• EPA-Region, RSPO
• EPA-Region, OSC
• EPA-Region, OSC
• EPA-Region, OSC
Probable File Location
0 Removal Response File
0 Removal Response Pile
• Immediate Removal
Response Pile
0 Innediate Removal
Response File
• Immediate Removal
Response File
-------
-25-
111 • Sequence of Events, Including Consistency with NCP (continued)
B. famed tate Ranovala (continued)
2. Contractor Selection (continued)
Document Originator
• Scope of Work (SOW)
and cost projections
• For removals requiring mote
than $2500
• EPA-O6C
• USOG-OSC
• State-OSC
• TAT Contractor
EPA Contact
• EPA-togion, OGC
Ptobable File Location
• Removal Response File
•°EPA Form 1900-49, Notice •
to Proceed with Emergency
Response to Hazardous
Substance Release
••EPA Foim 1900-50, Justi- •
fication for Noncompetitive
Procurement (JNCP)
00 EPA Poim 1900-52, Author- •
ity to Negotiate an
Individual Contract
EPA-OSC/Response Taara
Project Contractor
EPA-OSC/Response "team
TAT Contractor
EPA-OSC/Response Team
TAT Contractor
• EPA-Region, OSC
• EPA-Region, OSC
• EPA-Ragion, OSC
Imnedlate Removal
Response File
Dmediate Removal
Response File
Immediate Removal
Response File
-------
-26-
III. sequence of Events, Including Consistency with NCP (continued)
B. Immediate Removals (continued)
2. Contractor Selection (continued)
Document
••EPA Foira 1900-53,
Authority to use
a Time and Materials
Contract
••EPA floim 1900-54,
randum to the Pile-
Synopsis Exemption
• Pot procurement of services
from state and local
governments
Originator
• EPA-OSC/Respoase Team
• TAT Contractor
• EPA-OSC/Response Tea
TAT Contractor
• EPA-OSC/Rasponse learn
TAT Contractor
EPA Contact
* EPA-Ragion, OSC
• EPA-Itegion, OSC
• EPA-Itegion, OSC
Probable File Location
0 Immediate Removal
Response Pile
• Immediate Removal
Response Pile
• Immediate Removal
Response Pile
04 EPA Rum 1900-56, Letter
Contract for State or
Local Government Response
to Emergency Hazardous
Substance Release
•• EPA R»m 1900-50 (see
list above)
• EPA-OSC/Response Team
Project Contractor
• EPA-OSC/RBSponse Team
TAT Contractor
EPA-Itegion, OSC
EPA-Ragion, OSC
• immediate Removal
Response Pile
• Immediate Removal
Response Pile
00 EPA form 1900-52 (see
list above)
•*EPA Fotm 1900-54 (see
list above)
• EPA-OSC/Response Team
TAT Contractor
• EPA-OSC/Response Team
TAT Contractor
• EPA-Ragion, OSC
• EPA-Ragion, OSC
• Immediate Removal
• Response Pile
• Immediate Removal
-------
III. sequence of Events, including Consistency with HOP (continued)
B. ftraediate Removals (continued)
2. Contractor Selection (continued)
Document Originator EPA Contact
Probable Pile Location
EPA Pom 1900-57, Deter-
mination and Findings
Methods of Contracting
• EPArOSC/RBSponss Tarn
TAT Contractor
• EPA-Ragion, CSC
Immediate Removal
Response Pile
ro
• EPA Pom 1900-8, Procure-
ment Request/Requisition
(foe additional funds)
• EPA form 1900-30, Modi-
fication of Contracts
• Anendment of Solicitation-
Modification of Contract,
Standatd Fbtra 30
• EPA Ftxni 1900-58, Notice
Regarding Wotlc Stoppage
EPA-HO-Oontracta
CPA-OGC/Responae lean
TAT Contractors
EPA-HO-Oontracta
EPA-HO-OERR DitBCtOT
• EPA-HO-Oonttacts
Operations Office
* EPArOSC/Response Team
' TAT Contractor
• EPA-Ragion, OSC
• EPA-Ragion, OSC
• EPA-Ragion, OSC
• EPA-Ragion, OSC
• Bmediate Removal
Response Pile
• Mediate Removal
Response Pile
• Dnediate Removal
Response Pile
• Dmediate Removal
Response Pile
-------
-28-
III. Sequence off Events, Including Consistency with NCP (continued)
B. toraediate Removals (continued)
3. Response implementation
Document Originator EPA Contact
Probable File Location
• Inter-Agency
Agreements
Memoranda of
Understanding
(for reimbursement
of Superfund
telated activities
by federal
response agencies
such as Department
of justice,
Atiny Corps of
engineers)
• Health and Safety
Plan
• Ocmnunity Relations
Plan
Entry and exit logs
(for personnel, vehiclest
equipment and materials
Daily OGC logs
EPA-HO-06WER
Appropriate Federal
agency
EPA-Region, 06C
Project Contractor
EPA-OSC/Response Team
TAT Contractor
EPA-OSC
EPA-Region/HO-Public
Affairs Office
EPA-Region, Regional
Project Officers
State Agency
• EPA-OSC/Response Team
• TAT Oontractoc
EPA-OSC
BPA-Ragion, osc
EPA-Itegion,
project Officer
• EPA-Ragion, OSC
EPA-Ragion, OSC
• Immediate Removal
Rasponse Pile
• Immediate Removal
Response Pile
• Immediate Removal
Response Pile
• Immediate Removal
Response Pile
0 Immediate Removal
Response Pile
-------
-29-
III. Sequence of Events, Including Consistency with NCP (continued)
B. inroediate Removals (continued)
3. Response Implementation (continued)
Document Originator EPA Contact
• Incident obligation logs • EPA OSC/Response Team • EPA-Region, OGC
TAT Contractor
• Daily sumiary of CBNCIA • EPA OSC/Response Tea* • EPA-Region, O6C
cleanup TAT Contractor
Probable File location
Imnadiate Removal
Response Pile
Immediate Renewal
Response Pile
POLRCPS
• Daily work orders
• EPA OSC/Response
TAT Contractor
EPA-OSC
• EPA-Ragion, OGC
• EPA-Ragion,
project officer
• EPA-Ragion, OGC
Inraediate Removal
RBSponse Pile
Immediate Ramoval
Risponse Pile
• Daily wotk plans
Raoord of all
camunications in
and out of the
caimand post
All progress
tepocts
submitted by
other federal
agencies pursuant
to an NGU or IAG
Project Contractor
• EPA-Raglon, OGC
EPArCGC/RBSponse Team • EPA-Ragion, OGC
TAT Contractor
Apptopriate Federal
agency
• EPA-Ragion, OSC
• Inraediate Removal
Rasponse Pile
• Immediate Removal
Response Pile
• Immediate Removal
Response Pile
-------
-30-
III. Sequence off Events, Including Consistency with NCP (continued)
B. Diraediate Removals (continued)
Document
• Documentation
regarding use
of the EPA-EEHU
• EPA Form 1900-55,
Contractor Cost
Report (Completed
daily)
0 Daily Verification
of work by OSC
Originator
• EPA-O6C
0 EPA-ERT
• Project Contractor
EPA-OSC
EPA Contact
• EPA-Region, OSC
• EPA-Ragicn, OSC
* EPA-Ragion, OSC
Probable Pile location
* Inmadiate Removal
Response Pile
Immediate Removal
Response
Dimediate Removal
Response Pile
tn
• Documents regarding
operation and
maintenance of the
site following
the removal
0 Photographs, movies,
or video tape taken
of removal activities
• Documents relating to
all sampling and analysis
conducted during removal
(See pages 3 and 4 under
"Evidence of a Release
or Threat of a Ra lease"
Reponsible party
EPA-OSC/Pe^n
TAT Contrator
State Agency
Other contractor
EPA-OSC/Response Team
TAT Contractor
Project Contractor
EPA-OSC/Response Team
TAT Contractor
Project Contractor
State Agency
EPA-Ragion, OSC ° Immediate Removal
EPA-Ragion, RSPO Response Pile
Site
EPA-Region, OSC • Immediate Removal
Response Pile
EPA-Ragion, OSC • Immediate Removal
Response Pile
* See Technical Assistance Team (TAT) Contract User's Manual, Draft, USEPA - Emergency Response Division, October 14,
section applies to both immediate and planned removals.
-------
-31-
III. Sequence of Events, Including Consistency with NCP (continued)
B. Immediate Removals (continued)
4. TAT Contractual Documents for Removals
Docunent
• TAT Emergency Response
Removal and Prevention-
Technical Direction Doc-
unent (TDD) and
modifications
• Contractor Wbrfc Plans
(for special projects)
Originator
• EPA-Region, Deputy
(DPO)
• EPA-HD,
TAT-I*ader
EPA Contact
• EPA-Region, DPO
probable Pile location
• contracts File
• EPA-Ragion, DPO • Contracts Pile
TAT Emergency Response,
Removal and Prevention
TDD Acknowledgement of
Completion
Monthly Status Reports
(tasks and activities
for a TAT)
TAT-I0ader
TAT-Laader
• EPA-Ragion, DPO • Contracts rile
• EPA-Region, DPO • Contracts File
Special Project
Reports
Overall TAT Contract
Reports if appropriate
to the site (e.g.. Program
Management Information
Systems, Financial
Management, Status, or
Summary Progress Reports)
• TAT Contractor -
National Program Manager
• TAT Contractor - National
Program Manager
EPA-Ragion, DPO • Contracts File
EPA-Ragion, DPO • Contracts File
-------
-32-
III. Sequence off Events, Including Consistency with NCP (continued)
C. Planned Removals
1. Response initiation
Document
Originator
EPA Contact
Probable File location
• Record of notification or
discovery
• Documentation supporting
EPA-OSC request to EPA-
HO-ERD that an imnediate
removal be followed by a
planned removal, including
any statements, by experts
• Record of preliminary
assessments and initial
inspection of site (e.g.,
field notes, sampling
data, responsible patty
information)
• State request and cost
share assurances
EPA-OSC
EPA-HQ-ERD
(same as page 121, II, bullet II)
• EPA-HQ-ERD
• EPA-Region, O6C
* EPA-OSC
• State-OSC
• TAT Contractor
Governor or disignee
* EPA-Region, OSC
• EPA-Regional
Administrator and
Project Officer
• Planned Removal
Response File
• Planned Removal
Response File
• Planned Removal
Response File
• Initial POLREP
Draft Action Memorandum,
cover letter and
final action memorandum
with concurrences
• EPA-OSC
• TAT Contractor
• EPA-OSC
• EPA-Region, Regional
Project officer
• EPA-Region, OSC
• EPA-Region, Regional
project Officer
• BPA-HQ-BRD
• EPA-HO-ERD
• EPA-Region, Regional
project Officer
Plannnd Removal
Response File
Planned Removal
Response File
-------
-33-
III. Sequence of Events, Including Consistency with NCP (continued)
C. Planned Removals (continued)
2. Contractor Selection
Docunent Originator
EPA Contact
probable File Location
CD
• 14-Polnt document with
Justification for Non-
oompetitive Procurement
or Justification for
Limited Competition,
if appropriate
• Request for Proposal
(RFP) to contractors
listed in 14 Point
document
• Documentation regarding
the bidding and proposal
evaluation process
• EPA-06C
• TAT Oonttactot
• EPA-HO-Procurement
and Contracts
Management Division
(PCMD)
• EPA-OSC
• EPA-HO-PCMD
• EPA-IO-ERD
EPA-ttagion, Regional
Project Officer
EPA-HO-ERD
• EPA-togion, Regional
project Officer
• EPA-HO- ERD
EPA-HO-ERD
• Planned Removal
Response Pile
Planned Removal
Response File
Planned Removal
Response File
3. State Involvement
State Superfund Contract
•• Notice of Award and
documentation
00 Draft SSC and Gcnments
•• Final accepted SSC and
concurrences
• EPA-HQ-PCM)
EPA-Region-OSC
• EPA-HO-ERD (GDT)
EPA-Rogionro RPO
EPA-HO-ERD
EPA-Reglon-OSC
EPA-Region-ERD
Planned Removal
Response File
Planned Removal
Response File
Planned Removal
Response File
-------
-34-
III.. sequence of Events, Including Consistency with NCP (continued)
C. Planned Removals (continued)
3. State Involvement (continued)
Document Originator EPA Contact
ptobable Pile tocation
vo
•• Ccmnunications,
randa and other
documents relevant
to the conttact
00 Documentation of cost
ceiling for state
services
9 Daily documentation
of State costs
(daily log and
EPA fotm 1900-55
ot equivalent)
•• Request for payment
of cost share not
met through
services
•• Documentation of
state payment
EPA-HQ-ERD (ROT)
EPA-HD-ERD (GDI)
EPA-OSC
EPA-OSC
State Project
Coordinator
EPA-HQ-PMD
• EPA-HO- Fft)
• State Department
of Treasury
* EPA-Region-ERD (ROT)
• EPA-Region-ERD (GDT)
• EPA-Reg Ion, Regional
project Officer
• EPA-Region, Regional
Project Officer
EPA-Rogion, Regional
Project Officer
EPA-Region, Regional
Project Officer
• Planned Removal
Response File
• Planned Removal
Response file
• Planned Removal
Response Pile
• Planned Removal
Response Pile
• Planned Removal
Response Pile
•° Contract Amendments
EPA-HO-Gtants
Administration
State Agency
EPA-Region, Regional
Project Officer
• Planned Removal
Response Pile
-------
III. Sequence of Events, Including Consistency with NCP (continued)
C. Planned Removals (continued)
Document Originator EPA Contact
Ptobable File location
• State cooperative
agreement
•• Application (draft
and accompanying
documentation EPA
Form 5700-33; State
prograraatic Assurances i
EPA Form 5700-48}
Ccnmunity Relations Plan)
00
o
EPA-HQ-ERD (GOT)
EPA-tO-GAD (GOB)
EPA-Region, Regional
Project Officer
State Project officer
•• Decision Memorandum
•• Region and Headquarters
review comments
• EPA-Region, Regional
Administrator
EPA-Region, Progn
and Enforcement staff
EPA-IO-ERD (ROT), OWPE,
HSCD, OGC, OBC, OERR
with final approval by
AA, OSWER.
EPA-Regton, Regional
Project officer
• Planned Removal
Response File
• EPA-Region, Regional
Project Officer
• EPA-Region, Regional
project Officer
• Planned Removal
Response File
• Planned Removal
File
•• Grant Funding Order • EPA-HO-ERD (GOT)
•• Committment Notice
(EPA Form 2550-9)
•° Cooperative Agreement
(EPA Form 5700-20A)
• EPA-HOrOERR (PMC)
• EPA-Region, Regional
Project Officer
• EPA-HQ-GAD (GOB)
EPA-Region, Regional
project Officer
EPA-Region, Regional
Project Officer
EPA-Region, Regional
project officer
Planned Removal
Response File
Planned Removal
Response File
• Planned Removal
Response File
-------
-36-
III* .sequence of Events, Including Consistency with NCP (continued)
C. Planned Removals (continued)
3. state Involvement (continued)
Document Originator EPA Contact
00 Deviation from 40
CFR 30
00 Amenr*nents (EPA Fotm
and /or 20 B)
•° State approval of
Cooperative Agreement
(if required.)
• EPA-HO-ERD (GOT)
• EPA-HQ-GAD (GOB)
• EPA-HO-GAD
• State entity that must
vote to approve
EPA-Region, Regional
Project Officer
EPA-Region, Regional
Project Officer
EPA-Region, Regional
Project officer
Probable File Location
* Planned Removal
Response Pile
• Planned Removal
Response Pile
• Planned Removal
Response File
4. Response implementation - See pages 28-30 under "immediate Removals".
5. TAT Contractual Documents tot Removals - See page 31 under "Immediate Removals11.
-------
-37-
III. Sequence of Events, Including Consistency with NCP
P. Remedial Actions
1. Remedial Action Planning and Decision Making
00
to
Docunent
Remedial Action
Master Plan
'Documents relating to
the initiation of
RI/FS
' Documents relating to
the need for Initial
Remedial Measures
' Documents relating to
source control remedial
actions and off-site
remedial actions
Originator
• REX/FIT Contractor
• EPA-Region,
project Officer
• EPA Regional
project Officer
EPA Regional
Project officer
EPA Regional
Project officer
EPA Contact
• EPA-HQ, OERR
• EPA-HQ. OERR
• EPA-HQ, OERR
• EPA-HQ, OERR
Probable Pile Location
Remedial planning
Pile
Remedial Planning
File
Remedial Planning
Pile
Remedial Planning
Pile
2. State Involvement
• aedit Identification
Letter
0 EPA Inspector General's
Audit Report of
state accounting of
expenditures during
credit period
• State Agency
EPA Office of
Inspector General
• EPA-Ragion,
Financial Mgt.
Officer
• EPA-Region-
RSPO
• EPA-Region, RSPO
Remedial Responses
State Coordination
Pile
• Remedial Response:
State Coordination
File
-------
III. Sequence of Events, Including Consistency with NCP
D. Remedial Actions (continued)
2. State Involvement (continued)
Originator
-38-
(continued)
Document
0 Formal verification of
ctedit notification
9 Superfund Contracts and
documents supporting
State Assurances
00
CO
0 Contract Decision
Memo
• Copy of check from
State to EPA and
certified mail
teceipt (for
State share
of work done
under Superfund
Contract
• EPA-HQ- Hazardous Site
Control Division
• EPA-Region RSPO
State Attorney General
State Agency
EPA-Region-Superfund
coordinator and RSPO
Control Division
EPA-HO-AA for OSHER
• EPA-Region, RSPO
State Agency
EPA-HQ-Pinancial Manage-
ment Division
EPA Contact
* EPA-Region, RSPO
0 EPA-Region, Pin.
Mgt. Officer
0 EPA-Region, RSPO
EPA-Region, RSPO
EPA-Region, Pin.
Mgt. Officer
Probable Pile location
• Remedial Response:
State Coordination
Pile
0 Remedial Response:
State Coordination
File
• Remedial Response:
State Cooed. Pile
• Remedial Response:
State Coord. File
Cooperative Agreement
pro-application
notification
package (includes
EPA Form 5700-30
• State Agency
• EPA-Region, RSPO
• EPA-Rogional Counsel
• EPA-Region, RSPO
* Remedial Response:
State Cooed. File
-------
-39-
III. Sequence of Events, Including Consistency with NCP (continued)
D. Remedial Action (continued)
00
2. State Involvement (continued)
Document
• Documents Relating to
EPA Grants Administration
Division review Cot-
Cooperative
Agreement
• Cooperative Agreement
application package
Originator
• EPA-HQ, Giants Admin-
stration Division
• State Agency
• EPA-Region, RSPO
(includes EPA Pot* 5700-33 • EPA-Regional Counsel
• EPA-Region, RSPO
• Cooperative Agreement
Decision Memo
• Cooperative Agreement
Grant Funding Otder (EPA
Foim 5700-14
• EPA-HQ, Hazardous Site
Oonttol Division
• EPA-HQ, Grants Admin-
istration Division^
EPA Contact
• EPA-Region, RSPO
• EPA-Region, RSPO
• EPA-Region, RSPO
• EPA-Region, RSPO
Probable File Location
• Remedial Responses
State Coord. Pile
Remedial Responses
State Cootd. Pile
• Remedial Response i
State Cooed. File
• Remedial Response i
State Cooed. Pile
Cooperative Agreement
Ocnmittment Notice
(EPA Form 2550-9)
• EPA-HQ, Hazardous Site
Control Division
• EPA-HQ, Grants Admin-
stration Division
• EPA-Region, RSPO
• Remedial Responses
State Cootd. Pile
Cooperative Agreement,
Modifications, and
related documents
(includes EPA Forms
5700-20A and D
• EPA Award official • EPA-Ragion, RSPO
• Remedial Response:
State Coord. Pile
-------
00
Ul
til. Sequence of Events, Including Consistency with NCP
D. Remedial Action (continued)
2. State Involvement (continued)
Document Originator
• Cooperative Agreement • State
State Quarterly Progress
Reports, EPA reviews of
the Reports, and related
documents
-40-
(continued)
0 Documents Supporting
an expendituie
deviation Cor
Pie-award costs
0 State/EPA Correspondence
regarding Contracts/Coop-
erative Agreements
* EPA internal Garments
on draft and final
versions of Contract/
Cooperative Agreements
* EPA-HD-GAD (GOB)
• Appropriate Staff at
EPA Region/Ho
and State Agency
• Appropriate Staff at
EPA Region/HQ
EPA Contact
• EPA-Ragion, RSPO
• EPA-Ragion, RSPO
• .EPA-Region, Pin.
Mgt. officer
• EPA-Ragicn, RSPO
• EPA-Region, RSPO
Probable File Location
• Remedial Responses
State Ooocd. File
• Remedial Response:
State Cooed. File
• Remedial Response:
State Cootd. File
• Remedial Response:
State Cootd. File
• Sunmarles of all
meetings held to
negotiate Contract
/Cooperative Agreement
0 State legislation
or tegulations
authorizing States
to enter into
Oontt act/CooperatIve
Agteement
EPA-Ragion RSPO
State Statutes/Coda
of Regulations
• EPA-Regicn, RSPO • Remedial Responsei
State Cootd. File
• EPA-Reglon, RSPO • Remedial Response:
State Cooed. File
-------
-41-
III. Sequence of Events, Including Consistency with NCP (continued)
0. Remedial /totion (continued)
2. State Involvement (continued)
Document Originator EPA Contact
Ptobable Pile location
State approval (if
necessary by state
law) of Cooperative
Agreement/Contract
• State entity granting
approval
• EPA-Region, RSPO • Remedial Responses
State Coord. File
3. Response Implementation (continued)
00
en
• Investigation reports and
supporting documents
• Peasibility Study and
supporting documents
Review of design
plans and
specificationsi
• Appropriate Agency/
Contractor
• EPA-OSC/Response Team
• State-GGC/Response Team
• RBVFIT Contractor
• EP/V-Reg tonal or HQ
Technical Staff
• State Agency Technical
Staff
• EPA-OSC/Response Team
• State-CSC/Response Team
• REH/FIT Contractor
• EPA-Regional or HQ
Technical Staff
• State Agency Technical
Staff
• Army Corps of Engineers
* EPA-Reglon, RSPO
* EPA-Region, RSPO
• EPA-Region, RSPO
• Remedial Responses
Remedial Planning
• Remedial Responses
State Coord. File
• Remedial Responses
Remedial Planning
File
-------
-42-
III. sequence of Events, Including Consistency with NCP (continued)
D- Remedial Action (continued)
3. response implementation (continued)
Document Originator EPA Contact
00
• Logs, notes, reports,
manifests, work plans,
health and safety
plans and other
documents KBlating
to construction
activities
0 Be units and Manifests
(e.g., Dtedge and
Pill Material
Discharges-Sec. 404
Of CWA; RCRA-SBC.
6925)
• Photographs or video
tape taken of work
in progress
0 Final EPA-OSC Report
EPA-OSC/Response Team
State-OSC/Response Team
Project Contractors
Ootps of Engineers
Appropriate Federal or
State permitting Agency
Ootps of Engineers
Project Contractor
EPA-OSC/Response Team
State-OSC/Response Team
REM/FIT Contractor
Cotps of Engineers
EPA-OSC
Ootps of Engineers
• EPA-Region, RSPO
9 Cotps of Engineers
Site Project
Officer
Probable Fil« location
• Remedial Responsei
Remedial Implement.
File
EPA-Region, RSPO
• Remedial Responsei
Remedial Implement.
File
EPAr-Ragion, RSPO
EPA-Region-OSC
EPAr Reg.-RSPO
• Remedial Responses
Imagery File or Rem.
Implementation File
• Remedial Response
Remedial Implement.
File
-------
-43-
00
00
III. Sequence off Events, Including Consistency with NCP (continued)
D. Remedial Action (continued)
3. Response Implementation (continued)
Document
• Documentation relating
to all sampling and
analysis conducted
during construction
and with respect
to post-closure
monitoring (e.g.,
sampling and
analysis data
reports from
monitoring wells)
Originator
• EPA-OSC/Resp. tern
• State-OSC/tesp. lean
• HBJ/FIT Contractor
• Project Oontractor
EPA Contact
• EPA-Region, RSPO
Probable File location
• Remadial Response
Remedial Inplenent.
Pile
4. Contractual Documents tor Remedial Work
• RB^FIT Zone Conttact
Technical Directive
documents/ Work Assignments
EPA Regional RBfFIT
Coordinator
• EPA-Ragion, RSPO • Oonttacts Pile
-------
-44-
III. Sequence of Events, Including Consistency with NCP (continued)
D. Remedial Action (continued)
4. Contractual Documents tor Remedial Work (continued)
Document Originator
EPA Contact
Probable File location
00
0 REH/FIT Zone Contract
Regional Work Plan
Remedial Planning
and Support Activity
Projection - Wotk
Assignments
Zone
Contract - Technical
Directive
Document (TDD)
Wotk Assignment Package
• Contractor Work Plan
0 Management Plans (Zone
end Regional)
• progress Reports-technical/
Financial (Zone and
Regional)
• EPA Regional REH/FIT
Coordinator
• EPA-Region, RSPO
• Contract* pile
0 FIT Regional Project
Officer
0 EPA-Region, RSPO
• State Ptoj. Officer
• REH/FIT Contractor
0 REH/FIT Contractor
• REH/FIT Contractor
• EPA-Region, RSPO
• EPA-Region, RSPO
• EPA-Region, RSPO
• EPA-Regional REH/FIT
Cordinator
• EPA-Regional REH/FIT
Cordinator
• Contracts File
• Contracts File
• Contracts File
• Contracts File
• Contracts File
-------
-45-
vo
o
III. sequence of Events, Including Consistency with NCP (continued)
D. Reroedial Action (continued)
4. Contractual Documents tot Reroedial Work (continued)
Document
• Activity Completion
Reports (TDD Acknowl.
and Vtork Assigraent)
• Award Fee Performance
Event Reports
List of contact
poisons in the
community
Gamnunity Relations
Plan
Press teleases or
infotmation released
to the public
Summaries/transcripts
public meetings
Originator
• RHVFIT Contractor
• EPA Regional REH/FIT
Coordinator
• REH/FIT Regional Project
Officer
• EPA-Ragional Staff
• Staff of State and
local Agencies
• EPA-Region/HO-public
Affairs Office
• EPA-Region, RSPO
• Federal, State or Local
officials
• EPA/State officials
• Stenographer
EPA Contact
• EPA-Regional REtf
FIT Oordinator
EPA-Regional
FIT Cordinator
• EPA-Region, RSPO
• EPA-Region, RSPO
• EPA-Region, RSPO
• EPA-Region, RSPO
Probable File Location
• Contracts File
• Contracts File
• Remedial Responses
(feminity Relations
File
• Remedial Responses
Corammity Relations
File
• Remedial Responses
Oormunity Relations
File
• Remedial Responses
Oonraunity Relations
File
-------
-46-
III. sequence of Events, Including Oonsistency with NCP (continued)
E. Implementation off Cost Recovery plan
Docunent
• List of Patties
issued
Demand letter(s)
and dates of issuance
• Response to Demand
Letter (s)
• Formal cost recovery
referral memos
to EPA-IO-OLEC and
Department of Justice
(if response to
demand letters was
negative)
0 Correspondence and notes
from oral conmunications
with potential responsible
parties regarding
negot iat ions/settlement
• Settlement proposals and
supporting documents
0 Settlement agreements and
supporting documents**
Originator
• EPA-Regional Counsel
• EPA-HO-OLEC and GNPB
• U.S. Department of
Justice
• Potential Responsible
Party
• EPA-Regional Counsel
• Potential Responsible
Patty
' EPA-Regional Counsel
• EPA-HQ-OLEC and OWPE
• Potential Responsible
Patty
• EPA-Regional Counsel
• EPA-HO-OLEC and OWPE
• 'potential Responsible
Patty
• EPA-Regional Counsel
0 EPA-HQ-OLEC and OWPE
EPA Contact
• EPA-Regional Counsel
• EPA-Ragional Counsel
• EPA-Regional Counsel
• EPA-Regional Counsel
• EPA-Regional Counsel
Probable File Location
• Remedial Response:
Enforcement Pile
• Remedial Responses
Enforcement File
• Remedial Responses
Enforcement File
• Remedial Responses
Enforcement File
• Remedial Responses
Enforcement File
• Remedial Responses
Enforcement File
In
s where pattial settlements ate reached the p t or only some of the patties settle
-------
Appendix D
The following pages constitute a sample cost recovery plan that nay be
used by the Regions to facilitate the development and gathering of documents,
assess the evidence, issue demand letters and prepare for negotiations and
litigation The use of a cost recovery plan is purely optional. If a Region
chooses to use the cost recovery plan as a management and enforcement tool, it
may use any format it chooses. The plan included in this Appendix is intended
only as a sample.
92
-------
COST RECOVERY PLAN
vo
00
1. SITE NAMB_
ADDRESS
REGION
(State)
II. FUND ACTIVITIES AT SITE
Activity
Date Begun
(city or town)
Date Scheduled
Date Oonpleted to Begin
Dollars Spent
to Date
Imnediate Removal
Planned Removal
Remedial Investigation ft
Feasibility Stud (ti/fs)
Initial Remedial Mev.sutes
Remedial Design
Remedial Const tvict ion
.
III. FUND FINANCED ACTIVITIES TO BE COVERED BY THIS COST RECOVERY EFFORT
-------
-2-
IV.
Event
SUMMARY OF BACKGROUND EVENTS
Apptopriate Staff
Contact petson
Completion
Date OL Status
1. Responsible Patty Seatch and
Assesanent of Financial Status
2. Notice Letters Issued
3. 10-pt. of 14-pt. Documents
Piepated
4. RAMP Ptepated
5. Headquattets Review and Approval
of Coopetative Agteement/Supeifund
Contract
-------
-3-
V. DESIGNATION OF STAFF RESPONSIBILITIES AND TARGET DOTES FOR STEPS IN POST
RECOVERY PROCESS
en
Step
Ocropletion Date
projected Actual
PHASE I - Initial Steps
1.
2.
Monitor On-Going Fund Activity
Assess Responsible Party Inf Duration:
Identification of Responsible
Patties
Financial Capability Assessment
of Responsible patties
-------
-4-
vo
Step
Review Regional Superfund files and obtain
copies of any documents that can be used
to piove the occurrence or thieat of a
release and the liability of the poten-
tially responsible patties
PHASE II - Collection of Documents
1. Review Regional Superfund files and
obtain copies of any documents that can
be used as evidence to prove consistency
with the National Contingency Plan and
to document expend!tuies and decision-
making.
2. Obtain necessary documentation ftcm
Headquatters, contractctB, State and
othei federal agencies that weie in-
volved in the clean-up.
Assigned Tt>
Ocmpletion Date
Projected Actual
-------
-5-
vo
Assigned To
Completion Date
Projected Actual
PHASE III - Demand Letters
1. Draft Demand Letters
2. Obtain Signature "of Director, OWPE on
Demand Letters
PHASE IV - Negotiations
1. Establish Negotiation learn and Select
Team Leader and Lead Negotiator
2. Assess Evidence and Strength of Case.
Identify and Attempt to Rectify Data Gaps.
3. Search for and Select Experts, as
Appropriate.
4. Develop Negotiation Schedule
5. Coordinate with State and Local officials
6. Prepare Information Package for Respon-
sible Patties.
-------
-6-
vo
oo
Step
Couplet ion Date
Projected Actual
PHASE V -'Litigation
1. Piepate Case Ref feral Nemo
Repot t fot DOJ
2. Assess Bvidenoa to Suppoft
Release Occurted
Patty was Respcjosible
Response was Consistent
Tabulation ot Costs and
Docunentaticn
and Litigation
the Following:
with NCP
Suppott
3. Piepaie Briefings for HeadquaLtets and DOJ
4. Provide Legal Suppott to DOJ Outing Tiial
Ptepatation
5. Piovide Technical Suppott to DOJ Outing
Trial Ptepatation
-------
-7-
VI - Miscellaneous Issues Associated with the Site
It is recognized that there may be special technical, legal and policy issues
for a site which need to be addressed. Sane examples ate: handling laige
multi-geneiatoi cases; piercing cotpotate veils; policies and ptocedut.es tegatding
federal facility involvements} and State costs and consistency with the NCP.
These issues should be listed in this section of the plan and a staff menfcet and
due date foi a lesponse to the issue should be assigned.
vo
vo
-------
Appendix E
It is suggested that central files be set up in each Region to facilitate
the cost recovery data gathering effort. Each Region oust of course decide for
itself whether a central filing system would be beneficial and whether it is
logistically feasible. Appendix E contains a sanple file structure that the
Regions might consider if central files are to be set up.
100
-------
APPENDIX E
PROPOSED FILE STRUCTURE
To adequately document activities taken at a Superfund
site, an organized filing system is essential. A well defined
and maintained filing system will minimize duplication of files
as well as the time and effort required to locate documents,
facilitate the transition to the negotiation or litigation
phases of the cost recovery process, and allow Agency staff to
obtain status information about a site for management purposes.
The details regarding such a filing system are discussed in
a guidance paper entitled, "Regional Paper File Structure,"
Final Draft, U.S. EPA, Office of Emergency and Remedial
Response, Office of Policy and Program Management (OPPM),
December 1, 1982. The file structure which is presented in
Exhibit E-l is based on the one outlined in that guidance paper.
As appropriate, subsets of the files listed in Exhibit B-l
or additional files could be established for those sites which
have extensive documentation requirements. It is important to
note that the "Enforcement* file is defined narrowly (see
description below) for purposes of this filing system. A
filing system organized for an enforcement action would
necessitate the use of information contained in many different
files.
EXHIBIT E-l .
FILE STRUCTURE FOR SUPERFUND SITES
Site Overview
Congressional Inquiries/Hearings
Remedial Response
Discovery/Hazard Ranking
Remedial Planning
Remedial Implementation
State and Other Agency Coordination
Community Relations
Removal Response
Imagery
Enforcement
Contracts
Financial Transactions
Exhibit B-l specifically suggests a file location for each
document listed. Generally however, the files listed in
Exhibit E-l should include the following types of information:
101
-------
-2-
Site Overview - Includes site summary, chronological list
of events and dates, and selected computer system reports.
Congressional Inquiries/Hearings - Includes correspondence,
documents released in response to Congressional requests,
testimony presented at hearings, hearing transcripts,
Congressional committee reports and surveys regarding the
site.
Reaedial Response
Discovery/Hazard Ranking - Includes all documents
relating to the initial discovery or notification of a
site, documents regarding the preliminary assessment
of the site (e.g., information about site operation,
site investigations, sampling and analysis,
hydrogeology and biological inventory of surrounding
area), and hazard ranking forms.
Remedial Planning - Includes documents relating to
preparation of the RAMP, action memo, any remedial
investigation reports, feasibility studies, plans and
specifications, and design reports.
Remedial Implementation - Includes all permits, sampling
and data analysis, daily logs recorded' at the
site, OSC reports, health and safety plan, documents
regarding monitoring or maintenance activities.
State and Other Agency Coordination - Includes all
Inter-Agency Agreements, Memoranda of Understanding,
and all documents relating to the negotiation of a
Cooperative Agreement.
Community Relations - Includes all communications with
community organizations or individuals, minutes or
transcripts of public meetings, documents relating to
the Community Relations Plan, documents relating to
the health and safety plan, public comments on EPA
proposals and responses, press releases, and newspaper
articles and TV transcripts.
Removal Response* - Includes all documents relating to
response initiation, development of scope of work, and
response implementation for immediate and planned removals.
This file may not be located in the central file as the OSC
may need to retain all of the documents prepared in
connection with the removal. If possible, an index of the
documents contained in the removal file should be included
in the central file and the name and phone number of the
OSC or other responsible persons should be noted.
102
-------
-3-
Imaggry - Includes all current and historical photographs,
infra-red, thermal or other remote sensing of the site, and
any photographs or video tapes taken during a response
action.
Enforcement* - Includes information directly related to the
enforcement aspects of response actions taken at a site.
It includes data on prior legal actions (Federal, State and
Local), information relating to potential responsible
parties such as manifests, notice letters and responses,
negotiation documents, and demand letters and responses.
As noted above, additional information necessary to support
a cost recovery action will be included in other files.
Contracts - Includes all documents relating to the
development of the scope of work, request for proposals,
review of bids, contractor work plans and reports, EPA
reviews of contractor performance, and all summary reports
regarding the TAT or REM/FIT Contracts.
Financial Transactions** - Includes all documents relating
to allocation and commitment of Superfund monies (e.g.,
Action Memo), planned cost documents (e.g., RAM?
projections), estimated cost documents, obligation
documents (e.g., OSC obligation log), OSC-certified
invoices submitted by contractors, records of payment by
EPA, all internal (EPA), external (Treasury or OMB) and
trust fund reports relating to the site, State
letter-of-credit drawdown vouchers. State Quarterly
Reports, and other federal agency reports.
*This file or portions of this file may be located in the
Regional Counsel's office due to the confidential nature of
the material.
** See Regional Financial Procedures Manual, Draft, U.S. EPA,
August 29, 1962 for additional information regarding the
site financial file.
103
-------
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. DC 204CO
AB 291983
MEMORANDUM
SUBJECT: Coordination of EPA and State Actions in CERCLA
Cost Recovery negotiations and Litigation
FROM: Courtney Price
Special Counsel for
Lee Thomas
Assistant Adminisi
Solid Waste and Emergency Response
TO: Regional .Administrators, Regions I-X
Regional Counsels, Regions I-X
Director, Office of Intergovernmental Liaison
The clean-up of .hazardous waste disposal sites under the
Comprehensive Environmental Response, Compensation, and Liability
Act (CERCLA) involves payment of monies from the Hazardous Substance
Response Fund (the Fund) created by Section 211 of CERCLA to
individual States or to contractors to finance clean-up activities.
In many cases, the State in which the site is located will also
contribute its own funds to the site clean-up I/. EPA and the State
may thereafter negotiate with or take judicial action for recovery
of the amounts expended by them against the party or parties who
I/ Under CERCLA $104(c)(3), the State must pay or assure payment
of 10 percent of the cost of remedial action and operations and
maintenance at a site and at least 50 per cent of the cost of
all response actions at a facility which was owned by the State
or a subdivision at the time of disposal of hazardous substances.
Current Agency policy allows CERCLA funding of remedial
investigation, feasibility study, and remedial design at privately
owned sites without a State cost-share. Accordingly, any cost-
share previously paid by the State (allowable State services,
statutory credit or cash) for remedial investigations, feasibility
studies, and remedial design at privately owned sites will be
applied toward the State's share of the cost for remedial construction
at the site, see May 13, 1983 Memorandum from Lee M. Thomas.
104
-------
-2-
are legally responsible 2/. In those cases, the question arises
whether the separate negotiations or judicial actions of EPA or
the State to recover their respective funds might, in some way,
prejudice the other's right to recoup its monies, and if so,
what actions might be taken to avoid such prejudicial effect.
It may initially appear unreasonable to conceive that either
EPA or a State could take action which would interfere with the
other's right to recover monies expended for site clean-up.
However, the following points should be considered:
o State as Agent - EPA will frequently transfer its share
of clean-up funds to the State which will, in turn, spend
it oh the site under the cooperative agreement with EPA.
The cooperative agreement contains numerous protocols,
procedures, and other standards with which the State must
comply to assure the quality of the site investigation and
clean-up. Because of EPA's control over these matters,
adverse parties may argue that the State is EPA's agent or
representative for the expenditure of the funds. This
misunderstanding might be asserted as a defense to recovery
of remedial costs by a potentially responsible party.
2/ Further guidance on cost recovery procedures and responsible
parties is contained in a forthcoming policy entitled, "Cost
Recovery Actions under CERCLA."
105
-------
-3-
0 Collateral Estoppel - An adverse judgment by a court in an
action by either EPA or a State on the issue of recovery of
funds expended on the site might be held to collaterally
estop the other governmental agency from successfully bringing
a subsequent action against that same party 3/.
0 Insolvency of Responsible Party(s) - A settlement or
judgment by EPA or the State might exhaust the available
resources of the responsible party(s), leaving the other
governmental agency without possibility of a recovery.
Regardless of the merits of arguments which may be made on
the foregoing considerations, in the interest of promoting
Federal-State relations, there are certain rights and obligations
which should be clearly defined at the outset of the relationship.
The Regions, in cooperation with OERR, have recognized the benefits
of identifying these interests by reflecting them in the cooperative
agreements. Accordingly, this memorandum does not require the
Regions to adopt any new procedures or change any existing coopera-
tive agreements. Instead this document presents the rationale
for drafting cooperative agreements in the manner prescribed by
OERR.
3/ See United States v. I.T.T. Rayonier, Inc., 627 F.2d 996,
(9th Cir., 1980).
106
-------
-4-
THE COOPERATIVE AGREEMENT
1. Negation of Agency in Cooperative Agreement
The cooperative agreement should negate the principle that
the State is an agent for EPA. This is important for both govern-
mental agencies for a number of reasons. In the cooperative
agreement, EPA will necessarily require that the State observe
certain standards, procedures and protocols, such as in the
taking of samples, their chain-of-custody, analysis protocols,
and perhaps accounting procedures. The need to specify such
procedures could be argued to constitute a right to control the
actions of the State, an indicia of an agency relationship.
Neither EPA nor the State should wish to encourage such an
argument because of the potential exposure to tort liability
as well as the possibility of complicating a cost-recovery effort.
Therefore, the imputation of an agency relationship between EPA
and the State should be negated by appropriate language in the
cooperative agreement. Suggested language for such a provision
appears in the Appendix to this memorandum.
2. Requirement for Notice of Settlement or Action
The cooperative agreement between EPA and the State should
contain a provision that neither will initiate a cost recovery
proceeding or enter into a settlement with the responsible party
except after ample written notice in advance of the execution of
a settlement agreement or the filing of a suit. The provision
prevents rushing by EPA and the State to obtain a judgment against
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or settlement with the responsible party, thereby gaining
a position of preference with respect to the assets of the
responsible party.
Inclusion of such a provision in the cooperative agreement
is fair to both EPA and the State, in that neither may gain an
unexpected advantage to the assets of the responsible party by
separate negotiations of which the other may be unaware.
Such a provision also provides a means whereby each party to
the cooperative agreement may take separate independent action
to protect its interests, after having given the necessary notice,
if there are reasons to not engage in joint EPA-State negotiations
or file suits in coordination with each other against the
responsible parties. Suggested language for such a provision
appears in the Appendix to this memorandum, and provides for
written notice not less than 30 days in advance of settlement or
initiation of a cost recovery action.
3. Requirement for Cooperation and Coordination of
Cost Recovery Efforts
The cooperative agreement should also provide that EPA and
the State will cooperate with each other in efforts to recover
their respective shares of the costs of response activities at the
facility, and will coordinate their respective activities and
resources in such efforts, including the filing and coordination
of litigation for the recovery of costs and the use of evidence
and witnesses in such suits. This provision is desirable because
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cost recovery suits will involve considerable data, documents
and witnesses from both EPA, the State and their contractors,
and close coordination between EPA and the State will be very
important to the efficient and effective resolution of those
suits. Model language for this provision also appears in the
Appendix.
4. Requirement That Judicial Action Be Taken
in U.S. District Court
The cooperative agreement should also provide that any suit
filed by either party to the agreement against any third party for
recovery of response costs to which it may be entitled, shall be
brought in the U.S. District Court for the judicial district in
which the release or damages occurred, or in which the defendant
resides, may be found, or has his principal office ($H3(b)).
The purpose of this provision is to avoid fragmenting the efforts
of EPA and the State between Federal court (in which EPA would
bring a suit), and State court (in which the State could bring a
cost recovery suit under any applicable State law. See the
discussion of this point in the section entitled "Pending Cases",
infra). Model language for this provision also appears in the
Appendix.
NON-JUDICIAL SETTLEMENT
In the absence of an agency relationship between EPA and the
State, there is little possibility that the State could enter into
a separate agreement with the responsible party (as distinguished
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from a Decree or Judgment) which could affect EPA's rights against
the responsible party, other than to drain off that party's
assets which might be available for payment of- a cost-recovery
claim. In the case of a responsible party with substantial assets,
a separate settlement by the State or EPA may not present a
serious problem to the other party. However, assuming FPA becomes
aware of an impending settlement between the State and the
responsible party(s) 4/, the Agency should, before the settlement
is finalized, determine the probable extent of the responsible
party's financial ability to satisfy EPA's claim in addition to
payment of the settlement with the State 5/.
In most cases, the responsible party will probably wish
to simultaneously settle its liability with both the State and EPA.
Collective negotiation and settlement procedures involving the
4/ EPA should become aware of any impending settlement by the
State with a responsible party assuming there is a provision in
the cooperative agreement which requires the State to notify
EPA in writing thirty days in advance of any proposed settlement,
and the State complies with that agreement.
J5/ A determination of the financial ability of a potentially
responsible party can be made by the Financial Management Division
of the Agency, or by use of a Financial Assessment System which
has been developed by the Economic Analysis Division of the
Office of Policy Analysis of EPA. This system will provide case-
by-case, inexpensive and defensible estimates of ability-to-pay
which will be useful for settlement consideration. This system
requires a minimum of financial data which will usually be available
from a Dun and Bradstreet report, a Moody's listing, or an audited
financial statement. When that information is not available, the
system will enable enforcement personnel to focus data requests
to that information necessary to perform a minimum financial assess-
ment. Any questions about this system and its uses should be
directed to Kathy Summerlee, FTS 382-3077, or David Erickson,
FTS 382-2764.
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State, EPA, and the responsible parties should be encouraged
to avoid misunderstandings and to resolve all issues at the
same time. However, there will undoubtedly be circumstances
under which the responsible party may believe that it would
be advantageous to settle with one claimant (either EPA or
the State) and not the other. It is those cases where the
assets of the potentially responsible party would be sub-
stantially depleted by the settlement which could present
significant problems for each claimant.
It should be recognized at the outset that, absent the
proposed notice and coordination agreements discussed above,
there is nothing to prevent the State or EPA from settling
its claim in the absence and without the concurrence of the
otner. Where such a settlement would place either the State
or EPA in a more advantageous position with regard to the
assets of the responsible party, problems could arise which
could affect intergovernmental relations. In those cases,
the following options are available to EPA:
1. Should EPA determine that the State has independently
entered into settlement negotiations with the responsible
party, EPA should contact the appropriate State agency in an
effort to establish a joint settlement effort and strategy.
Simultaneously, EPA should notify the responsible party by
letter (if that has not already been done as part of the Agency's
cost recovery procedure), advising it of the Agency's claim, and
that no other person or entity is authorized to negotiate for or
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otherwise represent the Agency in respect to that claim.
At the same time, the Agency should initiate an investigation
into the financial resources of the responsible party to
determine whether there will be sufficient assets remaining
after the proposed State settlement to satisfy EPA's claim.
That investigation can be carried out in the manner described
in footnote 5.
2. If it is determined that the assets of the responsible
party will likely be depleted or substantially impaired by a
separate settlement with the State without provision being
made for EPA's claimf and if efforts to establish a joint
settlement effort with the State are not successful, then
consideration should be given to EPA's applying to the appro-
priate U.S. District Court for the appointment of a receiver
to operate or manage the assets of the responsible party for
the benefit of all creditors of that party. This action, if
taken in a timely manner, would prevent the.responsible
party from distributing its assets in a preferential manner.
However, the decision to attempt to forestall a State
settlement with a responsible party should be made only after
serious consideration of all factors involved, including:
4 the amount of EPA's. claim which might be prejudiced;
0 the past relations between EPA and the State agency
involved in the negotiations;
0 the circumstances under which the State and the
responsible party entered into the negotiations
without the presence of EPA;
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0 the existence of any agreement between EPA and
the State prohibiting such negotiations;
0 and any other factors which might bear upon the
decision.
While this action should be taken only as a last resort,
the Agency's responsibility to preserve and restore the Fund may
require such action. As in other such actions, a decision to
seek the appointment of a receiver for the assets of a responsible
party will require the concurrence of the Special Counsel to the
Administrator for Enforcement.
PENDING CASES
There are a number of cases in which States have already
initiated a suit against responsible parties, and EPA has
contributed or intends to contribute a portion of the clean-up
costs. In such cases, what is the proper forum and the best
method in which to proceed?
In the absence of an agreement with EPA to the contrary,
a State may, of course, proceed with an action in State court for
cost recovery claims based upon any applicable State law 6/.
6/ CERCLA §107{i) provides: "Nothing in this paragraph shall
affect or modify in any way the obligations or liability of any
person under any provision of State or Federal law, including
common law, for damages, injury or loss resulting from a release
of any hazardous substance or for removal or remedial action or
the costs of removal or remedial action of such hazardous
substance."
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States are also authorized to make claims under CERCLA for
the cost of response activities which they incurred at a site.
Section 107(a) of CERCLA, for example, provides for the liability
of past and present owners and operators of a facility, generators,
transporters and others for "all costs of removal or remedial
action incurred by the United States or a_ State not inconsistent
with the National Contingency Plan." Many other sections of
CERCLA refer to the right of the States to recover for their own
costs.
However, SH3(b) of CERCLA provides:
"... the United States district courts shall have exclusive
original jurisdiction over all controversies arising under
this Act, without regard to the citizenship of the parties
or the amount in controversy. Venue shall lie in any district
in which the release or damages occurred, or in which the
defendant resides, may be found, or has his principal office."
We interpret this provision to mean that any claim made
by EPA, the State or any other person for recovery of response
costs, which is based upon the provisions of CERCLA, must be
brought in the appropriate U.S. District Court, and may not
be asserted on behalf of EPA by a State in a State court
action 7/. Obviously, any claim asserted by EPA will be based
upon CERCLA and will be in U.S. District Court. Likewise, if
7/ In addition to the restriction of SH3(b), there are additional
reasons why the State could not attempt collection of the Federal
share of response costs. Under CERCLA $112(c)(3) and 28 USC 5516,
the U.S. Attorney General is required to represent EPA in these
proceedings. This may not be delegated to the States, and therefore
it is not possible to authorize the States to attempt collection
of the Federal share of response costs in a State court proceeding,
even should it be otherwise appropriate.
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the State's claim against a third person for its share of the
costs relies in whole or in part upon CERCLA, then it too must
be brought in U.S. District Court. A State may, therefore,
attempt recovery of its share of response costs in State
court only under some law or theory other than CERCLA.
We also believe it highly important that EPA and the State
attempt to coordinate their respective claims because:
0 such actions will involve a substantial amount of technical
data, documents and witnesses from both EPA and the State,
and each party could derive the benefit of the other's
evidence and witnesses;
0 coordination would avoid the necessity of maintaining two
separate proceedings which would duplicate much of the same
effort and resources; and
0 coordination of the claims would avoid the issue of collateral
estoppel discussed earlier in this memorandum.
We believe the States will be receptive to joint or cooperative
cost recovery actions with EPA for these reasons,, and for the
additional reason that the legal authority for the States to
recover is probably much clearer under CERCLA than it may be
under th? laws of most States.
The following options, or some variance thereof, should
therefore be followed in those cases where EPA provides CERCLA
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funds under a cooperative agreement to a State which has a suit
pending in State court against the responsible party:
Option I; EPA should require, as a condition of payment of
the CERCLA funds to the State, that the State will, within a
certain period of time (i.e., 30 days) after receipt of the
funds, dismiss without prejudice all claims for recovery or
reimbursement of any response costs at the site 8/ from any
action then pending in State court. The provisions recommended
earlier in this Memorandum for inclusion in all cooperative
agreements should also be used J9/.
It is not necessary to require that a single suit for cost
recovery be filed jointly by EPA and the State. It may be a
more simple procedure, and avoid potential logistical problems,
for each party to file its own suit separately, and then request
J3/ Note that this does not necessarily require a complete
dismissal of the pending State court action. This recognizes
that there may be other claims of the State involved in the
case, with which the State may wish to continue in the State
court proceedings, and that the existence of counterclaims by
the defendant on other issues may prevent the State from
effecting a complete dismissal of the case. The important
point is to eliminate all cost recovery claims from the
State court proceedings. Of course, if those are the only
claims involved in the State case, a complete dismissal of
the case would be the desired result.
2/ The Attorney General of the State should agree to or
concur in this provision of the cooperative agreement, since
it affects pending litigation in which the Attorney General
is representing the State. Such agreement or concurrence may
be limited to the particular provision requiring dismissal of
the case, and may be evidenced by an endorsement to the
cooperative agreement or by separate letter signed by the
Attorney General or his representative.
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the U.S. District Court before which they are pending to consoli-
date proceedings on the suits pursuant to Rule 42 of the Federal
Rules of Civil Procedure.
Note also that this option does not affirmatively require
that the State refile its claim in Federal court, but only
that if the claim is refiled, it will be in Federal court. The
requirement for cooperation and coordination between EPA and
the State will also apply to and encourage joint negotiations
with the responsible parties before filing of a suit in Federal
court, as well as to subsequent litigation in Federal court.
Option II; It is conceivable that a State may wish to continue
to pursue its cost recovery claim in State court, or may not
wish to coordinate its efforts with EPA. In such event, EPA
should not, even if it could, attempt to require it to do other-
wise. However, because collateral estoppel could be raised
against EPA by the responsible party(s) in event of an unfavorable
result in State court proceedings, EPA should, as a condition
of payment of the CERCLA funds, require that the State,
within a specified time, dismiss without prejudice or omit
from any action then pending or which it may subsequently
file in1 State court any claim for recovery of response costs
which in the opinion of EPA, are or may be based upon CERCLA,
or any law, regulation or authority other than that which
may exist under the laws of that State 10/.
10/ See comment at footnote 9.
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EPA should strongly urge the States with which it enters
into cooperate agreements to accept Option I, since it will
result in much greater effectiveness and cost-efficiency in
recovery actions. Option II should be adopted only after
all efforts to persuade the State have failed.
Note on Purpose and Use of this Memorandum
The policy and procedures set forth herein, and internal
office procedures adopted pursuant hereto, are intended solely
for the guidance of attorneys and other employees of the U.S.
Environmental Protection Agency. They are not intended to nor
do they constitute rule-making by the Agency, and may not be
relied upon to create a right or benefit, substantive or pro-
cedural, enforceable at law or in equity, by any person. The
Agency may take any action at varience with the policies or
procedures contained in this memorandum, or which are not in
compliance with internal office procedures that may be adopted
pursuant to these materials.
We recognize that this memorandum contains subject
matter which relates to sensitive areas of the Federal-State
relationship. Nothing contained herein is intended to imply
bad faith or improper motive on the part of any State or
agency thereof, and no such interpretation or construction of
any provision herein should be made. This memorandum attempts to
recognize that in the normal course of EPA-State relations,
occasions arise in which the interests of EPA and the State may
not be identical, and it is our intent to anticipate and
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prepare for such occasions so that they can be approached in
a rational, planned manner to minimize further potential
impact on the relationship.
If you have any questions or problems concerning any matter
contained herein, please call Russell B. Selman at FTS 426-7503.
Attachment
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APPENDIX
Under CERCLA, both EPA and affected States can institute
enforcement actions against and/or negotiations with parties
responsible for priority waste sites. When this occurs, a
settlement or legal action by either party could potentially
impede or even negate the claims of the other for recovery of
funds expended at the site. Obligations, rights, and pro-
cedures for litigation must be defined as early as possible
in the working relationship between EPA and the State to avoid
this eventuality. Therefore, provisions concerning cost recovery
should be in the Cooperative Agreement application. Specific
provisions that address different enforcement conditions are
presented below. These provisions should be reviewed, discussed
with the RSPO, and included in the application, as appropriate.
Please refer to the text of the Memorandum for guidance on
the use of these provisions.
!• Disclaimer of Agency Relationship
Nothing contained in this Agreement shall be construed to
create, either expressly or by implicaation, the relationship
of agency between EPA and the State. Any standards, procedures
or protocols prescribed in this Agreement to be followed by
the State during the performance of its obligations under this
Agreement are for assurance of the quality of the final product
of the actions contemplated by this Agreement, and do not
constitute a right to control the actions of the State. EPA
(including its employees and contractors) is not authorized to
represent.or act on behalf of the State in any matter relating
to the subject matter of this Agreement, and the State (including
its employees and contractors) is not authorized to represent or
act on behalf of EPA in any matter related to the subject matter
of this Agreement. Neither EPA nor the State shall be liable
for the contracts, acts, errors or omissions of the agents,
employees or contractors of the other party entered into,
committed or performed with respect to or in the performance
of this Agreement.
2. Notice of Intent to Settle or Initiate Proceedings
EPA and the State agree that, with respect to the claims
that each may be entitled to assert against any third person
(herein referred to as the "responsible party", whether one or
more) for reimbursement of any services, materials, monies or
other thing of value expended by EPA or the State for response
activity at site described herein, neither EPA nor the State
will enter into a settlement with or initiate a judicial or
administrative proceeding against a responsible party for the
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Appendix
ii
recovery of such sums except after having given notice in
writing to the other party to this Agreement not less than
thirty (30) days in advance of the date of the proposed
settlement or commencement of the proposed judicial or
administrative proceedings. Neither party to this Agreement
shall attempt to negotiate for nor collect rei;nbursement of
any response costs on behalf of the other part/, and
authority to do so is hereby expressly negated and denied.
3. Cooperation and Coordination in Cost Recovery Efforts
EPA and the State agree that they will cooperate and
coordinate in efforts to recover their respective costs of
response actions taken at the site described hereinf including
the negotiation of settlement and the filing and management
of any judicial actions against potential third parties. This
shall include coordination in the use of evidence and witnesses
available to each in the preparation and presentation of any
cost recovery action, excepting any documents or information
which may be confidential under the provisions of any applicable
State or Federal law or regulation.
4. Judicial Action in U.S. District Court
EPA and the State agree that judicial action taken by
either party against a potentially responsible party pursuant
to CERCLA for recovery of any sums expended in response
actions at the site described herein shall be filed in the
United States District Court for the judicial district in
which the site described in this Agreement is located, or in
such other judicial district of the United States District
Courts as may be authorized by section 113 of CERCLA, and
agreed to in writing by the parties of this Agreement.
5. Litigation Under CERCLA Sections 106 and 107
The award of this Agreement does not constitute a waiver
of EPA's right to bring an action against any person or persons
for liability under sections 106 or 107 of the Comprehensive
Environmental Response, Compensation/ arid Liability Act (CERCLA),
or any other statutory provision or common law.
6. Sharing Recovered Funds with EPA
Any recovery achieved by the State pursuant to settlement,
judgment or consent decree or any action against any of the
responsible parties will be shared with EPA in proportion to EPA's
contribution to the site cleanup under CERCLA.
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APPENDIX
iii
7. Dismissal By State of Pending Cost Recovery Action - Option I
The State does hereby agree that it will, not later than
thirty (30) days after the date of this Agreement, cause to be
dismissed, without prejudice to any subsequent refiling, any
and all claims of the State (or any Agency thereof) in the
case of "(State or Agency) v. (defendant), now pending in the
(Circuit, Chancery, etc.) Court of ,
Docket No. , for recovery of any services, materials,
monies or other thing of value expended or to be expended on
the site described in this Agreement. Any subsequent refiling
of said claims by the State or any agency thereof will be in
accordance with the provisions of this Agreement.
(See comment at footnote 9 of Memorandum regarding State
Attorney General concurrence with this provision.)
8. Dismissal By State of Pending Cost Recovery Action - Option II
The State does hereby agree that it will, not later than
thirty (30) days after the date of this Agreement, cause to be
dismissed, without prejudice to any subsequent refiling, any and
all claims of the State (or any Agency thereof) in the case of
"(State or Agency) v. (defendant), now pending in the Docket No.
_, for recovery of any services, materials, monies or
other thing of value expended or to be expended on the site
described in this Agreement which are based or rely, in whole
or in part, upon the provisions of the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980. Any subsequent
refiling of said claims by the State will be in accordance with
the provisions of this Agreement.
(See comment at footnote 9 of Memorandum regarding State
Attorney General concurrence with this provision.)
9. Emergency Response Action
It may in the course of conducting the remedial activities
covered by the Cooperative Agreement, become necessary to
initiate emergency response actions at the site. The Cooperative
Agreement application should contain a provision acknowledging
this eventuality and dealing with the effect any such emergency
actions will have upon the remedial project. The provision
below, or its equivalent, may be used in the application for this
purpose:
Any emergency response activities conducted
pursuant to the National Contingency Plan,
40 CFR section 300.65, shall not be restricted
by the terms of this Agreement. EPA and the
State may jointly suspend or modify the remedial
activities in the SOW of this Agreement during
and subsequent to necessary emergency response
actions.
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GUIDANCE MEMORANDUM
ON
USE AND ISSUANCE OF ADMINISTRATIVE ORDERS
UNDER
SECTION 106(a)
OF CERCLA
123
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TABLE OF CONTENTS
Introduction
II. Requirements for Issuance and Scope
of §106 (a) Administrative Orders .......... 4
A. Necessity for "Determination" ......... 5
B. Necessity for Actual or Threatened
Release of Hazardous Substance ..... ... 6
C. Necessity that Release or Threat
of Release be From a Facility ......... 7
D. Necessity for Existence of Imminent
and Substantial Endangerment ......... 8
E. Notice to Affected States ........... 9
III. Persons to Whom an Order May Be Issued ....... 10
IV. Criteria for Issuance of S106 Orders ........ 11
A. Responsible Parties' Financial Status ..'... 12
B. Number of Responsible Parties Subject to
the Order ............... ..... 13
C. Specificity of the Necessary Response Action. . 14
D. Agency's Readiness to Litigate the Merits
of the Order .................. 16
E. Competing Considerations ............ 16
V. Orders Relating to Removals and Remedial Actions. . 17
A. Immediate Removals ............... 17
B. Planned Removals and Remedial Actions ..... 19
VI. Procedures for Issuance of 5106 Orders. . ..... 20
A. Planned Removals and Remedial Actions ..... 21
B. Immediate Removals. . ; ............ 21
V
VII. Opportunity to Confer ............... 22
A. Planned Removals and Remedial Actions ..... 22
B. Emergency Situations .............. 23
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C. Conference Procedures 23
D. MocificatioT!, Revocation, or Stay of
the Order 24
vni. Procedure if Order Not Obeyed 25
IX. Note on Purpose and Use of This Memorandum 26
Appendix A: Notification Letter
Appendix B: Sample §106(a) Administrative Order
125
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endanger-e-t to the public health or welfare or the environment
because of an actual or threatened release of a hazardous
substance from a facility." A fine not exceeding 35,000 per
day may be imposed for willful violation, failure or refusal
to comply with a $106{a) Order (Order), and punitive damages
of up to three times the cost of clean-up of the site may be
imposed under S107(c)(3) for failure, without sufficient cause,
to properly provide removal or remedial action pursuant to such
an Order. In view of the magnitude of these penalties, the
Agency expects that the regulated community will comply with
administrative Orders. At the same time, the Agency's obliga-
tion is to ensure that Orders are properly issued.
It is the current policy of EPA that, whenever possible,
parties who have caused or contributed to a release or a threat
of a release of hazardous substances at a site should
rectify the problems at the site. This action is necessary
to ensure that the Agency efficiently manages the limited funds
available under CERCLA and to ensure that the maximum number of
sites are addressed.
Accordingly, after the Agency discovers a site and in advance
of completing a Remedial Investigation and Feasibility Study (RI/FS),
(and has conducted an endangerment assessment, or their equiva-
lent), responsible parties normally will be sent a notice letter
requesting them to clean up the site. Following completion of the
feasibility study, the Agency normally engages in discussions with
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responsible parties in an attempt to obtain promptly the agree-
ment cf such parties to voluntarily undertake the necessary
response actions. If the discussions are successful, the terms
of the agreement will be embodied in a judicial consent decree
or a §106 administrative consent Order.
In circumstances where the Agency wishes to compel a responsible
party to undertake the response actions, including instances where
no settlement can be reached, the Agency will consider issuing a
unilateral §106 Order in accordance with this guidance.
The administrative enforcement authority is an important
component of the Agency's enforcement program authorized under
CERCLA. This guidance is being issued to assist the regional
offices in developing and maintaining an effective CERCLA admini-
strative enforcement program. The effectiveness of the program
will be enhanced as site remedies are implemented by Respondents
in compliance with administrative orders, and as enforcement of
Orders with which Respondents are not in compliance is success-
fully and expeditidusly pursued by EPA. The Agency will
aggressively defend judicial challenges to Orders and enforce
instances of non-compliance to validate the CERCLA administrative
enforcement program. Regional offices should issue Orders consistent
with the criteria and procedures contained in this guidance to ensure
the legal sufficiency of the program.
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welfare or the environment. Therefore, Regional offices are urged
to consider the use of unilateral CSP.CLA administrative orders
in every case where compelling enforcement authority is neces-
sary. Criteria are provided herein to assist regional offices
in determining whether Orders are appropriate in any case. It
is essential that a balanced CERCLA enforcement program is
implemented by EPA, combining administrative and judicial enforce-
ment authorites, to ensure protection of health and the environ-
ment from the hazards of releases or threats of releases of
hazardous substances.
II. Requirements for Issuance and Scope of Section 106 CSRCLA
Orders
A comparison of 5106(a) and §7003 of the Resource Conser-
vation and Recovery Act (RCRA) reveals similarities in the two
sections, and therefore many of the criteria for issuance of a
$7003 Order also apply to $106 Orders.!/ In many situations,
either Order would be appropriate. Where the hazardous sub-
stances are also "hazardous waste" under RCRA, the Order should
cite the authority of both sections.
Section 106(a) of CERCLA provides as follows:
In addition to any other action taken by a State
or local government, when the President determines
that there may be an imminent and substantial
endangerment to the public health or welfare or
the environment because of an actual or threatened
I/ Guidance on the use of RCRA §7003 administrative orders
may be found in a memorandum entitled, "Issuance of Admini-
strative Orders under Section 7003 of the Resource Conser-
vation and Recovery Act" dated September 11, 1981.
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release of a hazardous substance from a facility,
he r.3\f require the Attorney General of the United
Ststes tc secure such relief as may be necessary
to abate such danger or threat... The President
may also, after notice to the affected State, take
such action under this section including, but not
limited to, issuing such orders as may be necessary
to protect public health and welfare and the environ-
ment.^/
In order for an Order to be issued, the following
legal pre-requisites must be met:
A. Necessity for a Determination Based Upon Evidence
A determination must be made that, because of a release
or threat of a release, an imminent and substantial endangerment
may exist. This determination will depend upon documentary, testi-
monial, and physical evidence obtained through investigations
and inspections. Other information concerning the nature of the
threat posed by a site may already be contained in Agency files,
such as data generated pursuant to S103 of CERCLA or the permit.
and notification sections of RCRA. The Order, therefore, must
include a finding that an imminent and substantial endangerment
may exist, in order to ensure that this statutory requirement is
met. (See sample order, Appendix B, Finding No. 7).
2/ The President has delegated his authority under this Section
to the Administrator of EPA and the U.S. Coast Guard by Executive
Order No. 12316 dated August 24, 1981. EPA and the Coast Guard
have entered into a Memorandum of Agreement dated October 9,
1981, that all site-related releases in the Coast Guard's juris-
dictional areas (coastal zones. Great Lakes, ports and harbors)
shall be the responsibility of EPA.
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3. Necessity of Actval or Threaten?-:: Release of
•.4.M««%4^COuo WM*u»owci.nOoi5
Section 106 requires that the imminent and substantial
encangerment be caused by "an actual or threatened release 3/
of a hazardous substance" from a facility. A "hazardous
substance" is defined in Section 101(14) of CERCLA, and is
generally any substance, waste or pollutant designated pur-
suant to Sections 307(a) and 311(b)(2)(A) of the Clean Water
Act, Section 3001 of RCRA, Section 112 of the Clean Air Act,
Section 7 of TSCA, or Section 102 of CERCLA. (Crude oil,
fractions thereof, natural gas, and liquefied natural gas
are exempted from statutory coverage.)
Whether a release from a facility is "actual" or "threatened"
primarily depends upon temporal considerations. Actual releases
should be observable in some form, either visually or through
analysis showing contaminants present in samples of soil, water
or air. A "threat" of a release, on the other hand, involves
releases which have yet to occur or have yet to find their way into
the environment. A bulging tank containing a hazardous substance
in which pressure has built up, and a surface impoundment
I/ A "Release" is defined in CERCLA §101(22) as "any spilling,
leaking, pumping, pouring, emitting, emptying, discharging,
ejecting, escaping, leaching, dumping or disposing into the
environment," with certain specific exemptions (e.g. release
solely in work place; engine exhaust; release of certain nuclear
material; and normal application of fertilizer).
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which is about to overflow because of heavy rainfall, present
obvious threats of a release. A threat is also presented by
corroding or leaking drums containing incompatible wastes mingled
in a common area. Accordingly, the determination of whether a
"threat" of a release warrants issuance of an Order is a judgment
decision to be made on a case-by-case basis.
The nature of both the hazardous substances present at the
site and the release or threat of release should be set forth as
findings in the order, together with the bases for such findings.
C. Necessity That Release or Threat of Release be
From a Facilitv
N
,
The release or threat of release must be from a "facility
which is defined in CERCLA §101(9) as:
(A) any building, structure, installation, equipment,
pipe or pipeline (including any pipe into a sewer or
publically owned treatment works), well, pit, pond,
lagoon, impoundment, ditch, landfill, -storage container,
motor vehicle, rolling stock, or aircraft, or (B) any
site or area where a hazardous substance has been
deposited, stored, disposed of or placed, or otherwise
come to be located; but does not include any consumer
product in consumer use or any vessel (a watercraft or
other contrivance used, or capable of being used, as a
means of transportation on water).
This definition of "facility" includes on-shore or off-shore
sites, including land transportation facilities, from which
releases or threats might originate. The Order must specify
the physical location that is the source of the release.
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D. Necessity for Existence of Imminent and Substantial
Evidence presented to support the issuance of a §106(a)
order must show "that there may be an imminent and substantial
endangerment" to public health or welfare or the environment.
The words "may be" indicate that Congress established a
standard of proof that does not require a certainty. The evidence
need not demonstrate that an imminent and substantial endangerment
to public health or the environment definitely exists. Instead,
an Order may be issued if there is sound reason to believe that
such an endangerment may exist.
Evidence of actual harm is not required. As the Court stated
in Ethyl Corp. v. EPA, construing an endangerment provision in the
Clean Air Act:
The meaning of "endanger" is not disputed. Case
law and dictionary definition agree that endanger
means something less than actual harm. When one
is endangered, harm is threatened; no actual injury
need over occur. (541 F.2d 1 at 13, footnotes omitted,
original emphasis, D.C. Cir., cert. den. 426 U.S. 941
(1976).)
It should also be noted while the risk of harm must be
imminent in order for the Agency to act under §106, the harm
itself need not be. (See the legislative history to the
•imminent and substantial endangerment* provision of 51431 of the
Safe Drinking Water Act, H. Rpt. 93-1185 at 35-36.) for example,
EPA could act if there exists a likelihood that contaminants
might be introduced into a water supply which could cause
damage after a period of latency. One must judge the risk or
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iikelihocd of the harm by examining the factual circumstances,
including, but not limited to: 1) nature and amount of the
hazardous substance involve-d; 2) the potential for exposure of
humans or the environment to the substance, and 3) the known
or suspected effect of the substance on humans or that part
of the environment subject to exposure to the substance.
Legal analyses of the concept of imminent and substantial
endangerment can also be found in Reserve Mining Co. v. EPA,
514 F.2d 492 (8th Cir. 1975); U.S. v. Vertac Chemical Co. et al,
489 F.Supp. 870 (E.D. Ark. 1980); U.S. v. Solvents Recovery
Service, 496 F. Supp. 1127 (D. Conn. 1980); U.S. v. Midwest
Solvent Recovery, 484 F. Supp. 138 (N.D. Ind. 1980)-; U.S. v.
Diamond Shamrock Corp., 17 E.R. 1329, (N.D. Ohio 1981); U.S. v.
Price, 688 F. 2d 204 (3rd Cir. 1982); U.S. v. Reilly Tar and
Chemical Corp., 546 F. Supp 1100 (D. Minn. 1982).
The nature of the endangerment and the basis for the finding
of an imminent and substantial endangerment must be set forth
in the Order. The link between the endangerment and the relief
mandated by the Order should also be evident.
E. Notice to Affected States
Finally, before an Order may be issued, the "affected state"
must be given notice of the Agency's intention to issue the
Order.
The Agency is not held to a statutory period of time for
notice. Normally, written notification to the state should
precede federal action by at least one week. Circumstances
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may arise, however, where rapid response at a site is necessary.
Ir. such cases, iss^ar.es =f sr. Crdar say fellow an abbreviated
notice period or even a telephone call mads by EPA to the
Director of the agency responsible for environmental protection
in the affected state. Written confirmation must follow such
telephone notice.
As indicated above, the notification should be directed to
the Director of the state agency having jurisdiction over
hazardous waste matters. A suggested form for a notification
letter is attached to this memorandum as Appendix A. This
form also provides the format for oral notice.
An "affected state" is interpreted to be the state where
the facility is located from which the discharge is being
released or threatens to be released, and in which the response
activity required by the proposed order will be taken. In some
cases, this may involve more than one state, such as where the
facility is located near the border of a state and the
hazardous substances have migrated from the facility located
in one state into another state(s). In those cases, all of
the states in which the hazardous substances are found and in
which response activity may be performed pursuant to the-order
should be notified.
III. Persons To Whom an Order May Be Issued
Section 106 does not specify any person or persons to whom
an Order may be issued, but permits the issuance of "such orders
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as :nay be necessary,.." Section 104(3), however, refers to the
"owner or operator" or "other responsible party" as the persons
to whom the Agency coulo look to determine whether clean-up of
a site will be done properly before expending CERCLA funds.
Section 107(a), designating those who shall be liable for
response costs, specifies present owners and operators of a
facility, persons who were owners and operators at the time
of disposal of a hazardous substance, and generators and certain
transporters who, according to available evidence, contributed
hazardous substances to the facility. It follows that those
same persons could be recipients of an Order issued under
Section 106(a), (see U.S. v. Outboard Marine Corp., 556 F. Supp.
54, 57 (N.D. 111. 1982). In addition, in appropriate cases,
it may be possible to issue orders to parties other than
those listed in Section 107(a), if actions by such parties are
necessary to protect the .public or the environment.
IV. Criteria for Issuance of 5106 Orders
Other parts of this guidance document examine the legal
requirements for issuing an Order. This section's purpose is
to list specific factors which favor the use of Orders
over other possible enforcement responses. These factors include:
0 Responsible parties* financial status
0 Number of potentially responsible parties
• Certainty of the necessary response action
0 Agency's readiness to litigate the merits
of the Order
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The theme common to these factors is that Orders should
be issued in those situations in which compliance with the
terms of the Order is feasible, i.e., where the Respondents
are in a position to perform the oroered response actions
within specified time periods. This does not iae«rx EPA must
make a pre-issuance determination that Respondents will com-
ply with an Order, but rather that compliance is practicable.
If the Agency does not anticipate compliance with an Order it
is considering issuing, the use of the Order may serve only to
delay direct injunctive action under 5106 or the initiation of
Fund-financed response. On the other hand, the Agency may wish
to issue an Order in any situation where the needed response action
and the liability therefor are clear and straight-forward, so
that refusal to comply with the terms of the Order would not, in
all probability,, be with "sufficient cause" (CERCLA $107(c)(3».
Such refusal would render the Respondent liable for civil penalties
or punitive damages in the event of federal cleanup.
A. Responsible Parties' Financial Status
Before an administrative order requiring remedial work
is issued, the Agency should assess, to the extent possible,
whether the responsible party has sufficient financial resources
to comply with the Order. Financial information is available
from several sources:
0 Agency files contain financial information
collected as part of the identification of
parties responsible for the hazards posed
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by sites on the National Priorities List.
0 The Securities and Exchange Commission (SSC) requires
publicly traded companies to submit detailed financial
statements. This information is publicly available.
(Consult NEIC'S manual entitled "Identifying Responsible
Parties" for additional information on obtaining SEC files.)
0 Responsible parties may submit financial information
to the Agency during discussions or negotiations held
prior to the issuance of an Order.
In addition, NEIC can provide further information on
Respondents' financial status.
B. Number of Responsible Parties Subject to the Order
For two primary reasons, the success of Orders for
remedial action is enhanced where there are relatively few
responsible parties.
1) Coordination of Response Action
An Order issued to multiple Respondents who are jointly
and severally liable generally will not allocate individual
clean up responsibilities..£/ Instead/ the Order will require
the same response action to be conducted by each responsible
party. Multiple parties must organize and coordinate their
response to ensure compliance with the Order's requirements.
Thus, compliance with Orders may depend upon group agreement
4/ However, the Agency may issue an Order to a Respondent
requiring a response to a discrete, separable aspect of the
hazard at a site, notwithstanding the existence of other
responsible parties or other less divisible problem areas.
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on each member's share of the response cost. In a large group
of responsiole parties, it may be difficult for the group to
develop a consensus on individual liability and perform response
activities as quickly as necessary to obate imminent hazard
conditions at a site. Accordingly, issuing Orders to all respon-
sible parties may not be appropriate where there are a large
number of parties who are unlikely to agree on a concerted response.
Instead, the Agency will pursue judicial remedies or consider
issuing Orders to a selected subset of responsible parties.
Even in situations where Orders are issued to a large number
of parties. Agency policy, which should be reflected in the
.terms of the Order, is that each Respondent is individually
liable for compliance with the Order's requirements. Individual
liability also extends to penalties and punitive damages imposed
by CERCLA for failure to comply with the Order.
2) Supervision
After an Order is issued, the Agency conducts compliance
monitoring at the site to ensure that responsible parties comply
with the terms of the Order. Although no maximum number of
responsible parties can be specified as optimum, it is clear that
the Agency's oversight responsibility is most effectively accom-
plished where there are a limited number of responsible parties.
C. Specificity of the Necessary Response Action
Jn order to minimize the potential for confusion between
Respondents and the Agency concerning the required response
action, Orders should be used in situations where the nature
of the required response action has been relatively precisely
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identified. Orders are normally better suited to mandating
discrete tasks such as drum removals rather than less exact
actions such as planning. Otherwise it may be difficult for the
Agency to supervise compliance activities, and for responsible
parties to reach agreement on a compliance plan. In most cases,
information sufficient to describe the required response actions
will be generated by the RI/FS.
An Order should contain the following elements (see
Appendix B):
0 The steps the Respondent must take to comply with
the Order;
0 The effective date of the Order;
0 A mandatory time-table for completion
of remedial work; and/ where appropriate,
0 A statement to the effect that other actions or orders
may follow.
Specific remedial action Orders benefit both the Agency and
responsible parties. Responsible parties are provided clearly
defined compliance standards which will facilitate agreement
among the responsible parties on a remedial plan. If the
responsible parties then determine that the remedial work is
best accomplished by a third party contractor, the Order provides
a basis for their contract negotiations.
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Specific Orders benefit the Agency by reducing the difficulty
of supervision and judicial enforcement. In noncompliance situa-
tions, t^e Agency may seek to enforce an Order in court. A
specific Order provides the court with Agency-articulated stan-
dards by which to judge the responsible party's non-compliance
with its terms. . Therefore, EPA should make every effort to
clearly articulate the response activities required by an Order.
B. Agency's Readiness to Litigate the Merits of the Order
After the Agency issues an Order, the respondent may seek
judicial review to stay the Order. Respondents may challenge
their liability or the appropriateness of the remedy specified
in the Order. On the other hand, the Agency nay promptly seek
to enforce the Order in court. In light of these possibilities,
the Agency must be ready to defend the Order in court at the time
it is issued. This means that the site problem, the reasonable-
ness of the required response, evidence of liability, and the
Agency's response to.issues raised by the recipient must be
thoroughly documented, and that the documentation be organized
and easily retrievable. The documentation will constitute the
administrative record for any litigation.
E. Competing Considerations
The absence of the factors listed above may argue in favor
of pursuing a judicial or Fund-financed, rather than an adminis-
trative, remedy. For example, EPA should not normally issue an
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order if the necessary response actions have not been clearly
identified. In addition, Agency enforcement personnel should
strongly consider the judicial course of action if:
0 the responsible parties have violated provisions
in several environmental statutes;
0 the opportunity for public comment on the terms
of a settlement agreement warrants the use of a
judicial consent decree/ (where there is a 30-day
comment period before the decree is finalized) 5/;
and
0 there is a need for long term court oversight of
a settlement agreement/ (such as in cases where an
agreement calls for separately enforceable response
milestones prior to completion of the cleanup).
V. Orders Relating to Removals and Remedial Actions
Guidance on conducting removal actions issued by the
Office of Emergency and Remedial Response (OERR) divides the
statutory concept of removals into "immediate" and "planned"
removals.
A. Immediate Removals
Immediate removal actions are to be taken only if a
response is needed within a relatively short time frame to
prevent or mitigate significant harm to human health or the
5/ However/ it should be noted that the Agency is exploring
mechanisms which provide for public comment on both unilateral
and consent administrative Orders. Guidance on this matter will
be provided at a later date.
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environment, and such action will not otherwise be provided
on a timely basis.
Orders may be used to compel various immediate removal
measures, including:
1. Suspension of activities which aggravate an
existing release or substantial threat of a
release (e.g., active use of a storage tank
judged by the OSC to be in imminent danger of
failure). .
2. Suspension of activities which interfere with
Federal removal actions (e.g., plant traffic in
area of cleanup).
3. Movement or non-movement of a transport vehicle
(railway tank car, tank truck, tank vessel)
which is the source of a release or substantial
threat of a release.
4. Measures to limit access, such as fencing.
5. Use of readily available equipment, owned by the
responsible party, to contain or remove a release
during the initial stages of a response before
the OSC is able to obtain comparable equipment
from other sources.
6. Dikings; construction of berms; or removal of
the hazardous substance to an approved facility.
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(This list illustrates various uses for an Order; it is not an
Section 106 (a) Orders, both in immediate and non- immediate
situations, must contain a statement notifying the party of
EPA's authority and the liability that may be incurred by
failure to comply. As specifically as possible the Order
prescribes the response activity and sets the date for its
completion. To ensure enforceability of the Order, EPA should
not undertake its own CERCLA-funded response activity during
t
the period of time given to the party to respond, unless (i)
such CERCLA-funded response activity becomes necessary due to
the immaediacy of the release or threat of release or (ii) the
Respondent formally and unequivocally states an unwillingness
to comply with the Order. In the event the party undertakes
response activity, the OSC should remain on-site to ensure
i
that the work is being conducted in accordance with the Order.
B. Planned Removals and Remedial Actions
Planned removal situations are those that allow several
days or weeks to execute the response. Remedial actions, on
the other hand, are generally those intended to provide a
permanent resolution to the release and require a longer time
and more expensive efforts to implement.
As in the case of immediate removals, an Order is available
to compel response measures routinely taken during planned removal
and remedial actions. "Removal activity" includes assessment
programs to evaluate the nature of the problem, and removal of
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material from the site. "Remedial actions" are those consistent
*«i k_.4 ^ PSrTTiSr.srik. rsiuSuy, a~d include such activity as Cappiny tli<
area, trenching, and provision of an alternate water supply.6/
EPA's position is that any activity that the Government might
undertake at a site - from planning and studies to complete
cleanup-could be ordered pursuant to §106(a). Of course, the
issuance of more than one Order may be necessary if the cleanup
is performed in stages, or if additional responsible parties
become known to EPA who should participate in the cleanup.
'«M
VI. Procedures for Issuance of S106(a) Orders.
CSRCLA designates the President as the primary official
responsible for taking response and enforcement action under
the Act. The authority to issue administrative orders under
$106(a) has been delegated to the Administrator of EPA by
Executive Order No. 12316, and redelegated by the Administrator
to the Regional Administrators and the Assistant Administrator
for Solid Waste and Emergency Response (AA-OSWER). The RAs and
the AA-OSWER must consult with the Associate Administrator for
Legal and Enforcement Counsel (AA-OLEC) prior to exercising
this authority/ and the RAs must obtain advance concurrence from
the AA-OSWER. (See Delegations Manual: 14-14.) The AA-OLEC has
j>/ See §101(23) of CERCLA for definition of "remove" or "removal",
and §101(24) of CERCLA for definition of "remedy" or "remedial
action". Those definitions contain detailed examples of the
types of activities that fall within these categories.
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redelegated the consultation authority to the Associate Enforce-
ment Counsel-Waste and the Regional Counsels. The AA OSWER has
redelegatec his advance concurrence authority to the Director,
Office of Waste Programs Enforcement (OWPE). The Office of
Waste Programs Enforcement will develop and issue criteria in
separate guidance which will be used to evaluate circumstances
under which this advance concurrence requirement will be waived
on a Region by Region basis. Regional offices are expected to
develop strong administrative enforcement programs, on an expedi-
tious schedule, which will permit them to initiate and issue
legally and technically adequate administrative orders with
only prior notice to Headquarters.
A. Planned Removals and Remedial Actions
For planned removals and remedial actions. Orders are
drafted by the Regional program office with the cooperation of
the Regional Counsel's office. The draft Order is forwarded
•s
to the Office of Waste Programs Enforcement for review and con-
currence. The Regional Administrators will usually issue the
Order and provide prior notice of the action to the state.
B. Immediate Removals
For those Orders which require emergency or quick handling,
usually in response to situations warranting an immediate
removal, the following approval sequence will be used:
The Regional Administrator first must determine whether
to issue an Order based on communication with the OSC and
consultation with Regional Counsel. The Region then prepares
an order with any supporting information and electronically
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Che material to the Office of Waste Programs Enforce-
ment for review and concurrence. Notification to the State
of our intent to issue the Order should be accomplished orally,
and followed up by formal written notice.
VII. Opportunity to Confer
Agency policy is to offer parties to whom EPA has issued a
unilateral §106 Order an opportunity to confer with the Agency con-
cerning the appropriateness of its terms and its applicability to the
recipient. The conference, will help EPA ensure that it has
based its Order on complete and accurate information and help
EPA and Respondents reach a common understanding of how the
Order should be implemented or modified. The procedures for
exercising this option are communicated to respondents through
the text of the Order itself. (See sample Order, page 4 of
Appendix B.)
A. Planned Removals and Remedial Actions
Each Order will specify a date when the Order becomes
effective. For actions other than immediate removals, the
effective date should ordinarily be twenty calendar days from
the day the Order is received by the Respondent. Certain Orders,
such as those requiring that long term remedial actions be taken,
may warrant a more extensive examination of the facts. In such
cases, the Order may specify an effective date more than twenty
days removed to permit the Respondent an opportunity to discuss the
Order with the Agency beyond that accorded by the procedures set
forth in Subpart C below.
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If the Respondent seeks to confer with the Agency about
the Order, the Respondent must provide written notification
co the EPA official listed in the Order within ten calendar
days of the dat.e of receipt. The conference should be scheduled
and held as soon thereafter as practicable, but prior to twenty
days from the data the Order was received by the Respondent.
B. Emergency Situations
The applicable time periods for the effective date and
for requesting a conference may be shortened, (e.g., to 72
and 48 hours respectively), or the conference procedures may
be eliminated entirely, if the immediacy of the hazard posed
by a site and other surrounding circumstances so warrant.
In the former situation, the Order should permit the.Respondent
to request a conference orally, later followed by written
notification.
C. Conference Procedures
The conference will normally be held at the appropriate
EPA Regional office and will be presided over by the Regional
Administrator's designee. However, other arrangements may be
agreed to for the sake of convenience to the parties. At the
conference, EPA should be prepared to provide the Respondent
with information sufficient to explain the basis for the Order
and to promote constructive discussions. The Respondent will
have the opportunity to ask questions and present its views
through legal counsel or technical"advisors. The schedule and
agenda for the conference will be left to the discretion of
the EPA official leading the conference, as long as the Respondent
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receives a reasonable opportunity to address relevant issues.
Following the conference, a written sununary of the proceeding
must be prepared, signed by the Agency official who presided over
the conference. Th= vrittsn statement should contain:
0 A statement of the date's) anc attendees
of any conference(s) held; and
0 A description of the major inquiries made and
views offered by the Respondent contesting
the terms of the Order.
In addition, the presiding official must prepare a statement
which addresses the significant arguments raised by the Respon-
dent and which recommends whether and how the Order should be
modified, together with the reasons therefor.
D. Modification/ Revocation/ or Stay of the Order
Based upon a review .of the file upon which the Order
initially was based, any probative information or argument
proffered by the Respondent following receipt of the Order,
and the recommendation of the presiding official, the issuing
official may modify or revoke the Order. Any modification to the
Order must be communicated to the Respondent as part of a copy of
a written statement containing the elements listed in Subpart C
above. The original should be kept in the Agency files along
with the evidence supporting the order, copies of written
documents offered in rebuttal by the Respondent during the
conference, and a copy of the request for a conference.
The issuing official may also stay the effective date of
the Order if the conference process could not be completed
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within the specified time period. Before substantially modifying
or revoking an Order, the issuing official must consult with
the appropriate Headquarters or Regional counsel and obtain th*
advance concurrence of the Director, OwP£.
VIII. Procedure If Order Is Not Obeyed
In the event the party to whom the Order is issued does
not comply with its terms, the Agency roust quickly decide
whether to attempt to enforce the Order by referring the case
to the Department of Justice for filing of a suit to force
compliance, or whether to undertake cleanup of the site by
use of CERCLA funds, and then file suit against the party for
reimbursement of the costs expended plus statutory penalties
for failure to comply with the Order.
The determination of which action to pursue depends
on the type of response action to be taken. Obviously, if an
immediate removal action is required by the hazard at the
site, EPA will clean up the site and attempt recovery of costs
and penalties in a subsequent recovery action. The same course
of action applies to a planned removal where the removal action
must be quickly undertaken and cannot await the filing of a
suit. However, planned removal or remedial responses which
require an extended period of time to perform, and in which
initiation of action may be delayed for a brief period without
jeopardising human health and the environment, may allow sufficient
time for the filing of a suit to enforce the Order, or at least
that portion of the Order which calls for the planned removal or
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remedial action to be taken.
Ofc V. — «• « ., — fc — «... . .V * •« h — - . »
*••»»• A ta» W W W A *• •*k*^«v«* «ltM J^
elude the strength of evidence and the financial ability of the
party to perform tr.s cesired response activity. The decision of
which option to pursue is initially to be made by the Regional
Administrator/ in the same manner and using the same procedures
as previously prescribed for any other enforcement action. The
Regional Administrator's recommendation is then forwarded to
Headquarters for action.
IX. Note on Purpose and Use of This Memorandum
The policy and procedures set forth herein, and internal
office procedures adopted pursuant hereto, are intended solely
for the guidance of attorneys and other employees of the U.S.
Environmental Protection Agency. They are not intended to nor
do they constitute rule-making by the Agency, and may not be
reli-ed upon to create a right or benefit, substantive or pro-
cedural, enforceable at law or in equity, by any person. The
Agency may take any action which is at variance with the
policies or procedures contained in thi-s memorandum, or which
is not in compliance with internal office procedures that may
be adopted pursuant to these materials.
Attached to this memorandum as Appendices A and B are
0 A sample letter to a state providing notification
of the Agency's intent to issue a §106 Order; and
0 A sample Order.
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If you have any questions or problems concerning any
i*iatter contained hsrein/ ~ls2S2 C3ll ths Director/ CW?S
(382-4314), or Russell 3. Selman (426-7503) or Steve Leifer
(332-4543) of the Office of Legal and Enforcement Policy.
Attachments
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Appendix A
STATE NOTIFICATION LETTER
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
Mr. R. Jones
State Agency
Division of Environmental Control
Dear Mr. Jones:
Enclosed for your information is a copy of an order
[stamped "DRAFT" and "CONFIDENTIAL"] that the Agency intends
to issue on or after [date] , to the XYZ Company, pursuant
to Section 106(a) of the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, (42 USC 9606). The
order requires certain activities to be taken at the company's
site located at [location] . Please refer to the enclosed
copy of the proposed order for the specific actions required
of the company and the time within which such actions must
be taken. If you have any comments or questions concerning
the order, please contact [EPA official] at [office]«
Sincerely yours,
Assistant Administrator for
Solid Waste and Emergency Response
[or] .
Regional Administrator
[or their designees]
Enclosure
cc: Honorable J. Smith, Governor
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Appendix 3
SAMPLE ORDER
CERTIFIED MAIL
RZ1URI-J RECEIPT REQUESTED
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
In The Matter Of )
(Name of Person/ )
Firm or Corporation) )
) Docket No.
Proceeding Under Section 106(a/ of the )
Comprehensive Environmental Response, )
Compensation and Liability Act of 1980 )
(42 USC Section 9606(a)) )
ORDER
The following Order is issued on this date to (insert name
and address of person/ firm or corporation/ along with facility
name or place of business if the Respondent is not the owner
or operator) ("Respondent(s)*), pursuant to S106(a) of the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980 (CERCLA) (42 USC 9606(a)), by authority delegated to
the undersigned by the Administrator of the United States Envi-
ronmental Protection Agency (EPA). Notice of the issuance of
this Order has heretofore been given to the State of ___________
There is an imminent and substantial endangerment to the
public health and welfare and the environment due to a (threat
of a release)(release) of (a) hazardous substance(s) as defined
in §101(14) of CERCLA (42 USC 9601(14)), from the following
location (the "Facility"):
(insert legal description, if known;
otherwise, use street or route address)
This order directs you to undertake action to protect the public
and the environment from this endangerment.
FINDINGS AND CONCLUSIONS
1. (Choose one or more of 1A through IE, as appropriate under
the factual situation of the case. Do not include headings.)
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1A. i{Present Owner)- Respondent is now, and has been since
. • 19 » the (owner)(and)(operator) of the Facility/ as
determined from (source of information)).
IB. [(Former owner/opg ra tor) - Respondent was, from ,
19 ;, until • 12 , the (owner) (and) (operator)
of the Facility, as determined from (source of information).
During that tine, hazardous substances, including those described
herein, were disposed of at the facility. Respondent sold or
otherwise transferred and conveyed the Facility to
on , 19 , according to (property records)].
1C. [(Generator) - Respondent (disposed of) (arranged, by con-
tract or agreement, for the disposal or transport for disposal)
of hazardous substances at the Facility as determined from
(source)].
ID. [(Transporter) - Respondent chose to accept hazardous
substances for transport to, and disposal at, the Facility as
determined from (source)].
IE. [(Other Party) (Insert reasons why ordered actions are
necessary to facilitate the abatement of the hazard, prevent the
aggravation of the hazard, or otherwise protect the public health'
and welfare and/or the environment.)]
2. (Describe the nature of the facility.)
3. On or about the day of , .19 , an
inspection of the Facility was conducted by (names) .
(a) duly authorized representative(s) of (EPA, State agency).
At the time of that inspection, the inspectors observed the
following conditions existing at the Facility:
A. Approximately 1000 drums of liquid, semi-solid
and solid material, which were leaking, without
covers and in various stages of corrosion,
rusting and other deterioration, located directly
on the ground. Material leaking from said drums
was observed running approximately 25 yards
across the site into Crystal Creek, which adjoins
the Facility, and which is a tributary of Pristine
River, a navigable water. According to records at
the Facility, materials contained in the drums
include:
(describe hazardous substances)
B. An area in the Facility (the "Landfill area")
of approximately four (4) acres in size,
without vegetation, from which leachate was
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observed flowing approximately forty (40) yards
into Crystal Creek. Vegetation had been killed
i** WA*
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ORDER
the foregoing determinations and Findings of
Fact, it is hereoy urdered and Directed that:
(NOTE - the Respondent may be ordered to undertake
any response activity that may b*» remirec to
protect public health, welfare.and the environment,
including, but not limited to, those actions which
the government is authorized to carry out under
CERCLA.)
(Insert here the response actions which EPA directs
the Respondent to take at the site. Each activity,
(i.e., redrumming cf waste, construction of fencing,
levees, submission of plans for installation of
monitoring wells, etc.), and the date for compliance
with each activity, should be listed separately.)
(Insert a statement to the effect that other orders
or action may follow.)
EFFECTIVE DATE - OPPORTUNITY TO CONFER
This Order is effective on the twentieth calendar day
following receipt thereof by Respondent, and all times for
performance of response activities shall be calculated from
that date. (Mote: For immediate removal situations, the
effective date will be considerably abbreviated.)
You may, within ten calendar days after receipt of this
Order, request in writing a conference with (Official) to
discuss this Order and its applicability to you. (Note: For
immediate removal situations, the time for requesting a hearing
will be abbreviated. In addition, the Respondent should be
informed that he or she may make an oral request for a con-
ference, to be followed up by written notice within two to
three days.)
At any conference held pursuant to your request, you may
appear in person and by attorney or other representatives for
the purpose of presenting any objections, defenses or contentions
which you may have regarding this Order. If you desire such a
conference, please contact ( name, title, address and telephone
number of EPA contact) within the time set forth above for
requesting a conference.
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PENAL7I5S FOR NON-COMPLIANCE
Respondent is advised that willful violation or failure or
refusal to comply with this Orderf or any portion thereof, may
subject you under S105(j) of CE?.CLA, (42 U.3.C. §9606ib;}, cc a
civil penalty of not more than S5000 for each day in which such
violation occurs or such failure to comply continues. Failure
to comply with this Order, or any portion thereof, without
sufficient cause, may subject you under S107(c)(3)'of CERCLA,
(42 U.S.C. S9607(c)(3)), to liability for punitive damages in an
amount up to three times the amount of any costs incurred
by the government as a result of your failure to take proper
action.
WITNESS my hand in the City of ; , State of
, as (title of authorized SPA issuing official),
on this day of » 19.
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
By:
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. D.C. 20460
JAN 26 1934
MEMORANDUM
SUBJECT:
FROM:
Releasing Identities of Potentially Responsible
Parties in Response to FOIA Requests
Gene A. Lucero, Director (S?'0VJL A.
Office of Waste Programs Enforcement*
waste
ce Monitoring
Kirk F. Sniff
Associate Enforcement Counsel
Office of Enforcement and Compl
TO:
Directors, Waste Management Division, Regions I, V
Director r Office of Emergency & Remedial Response, Region II
Director, Hazardous Waste Management Division, Region III
Directors, Air 6 Waste Management Division,
Regions IV, VI, VII, VIII
Director, Toxics & Waste Management Division, Region IX
Director, Air & Waste Division, Region X
Regional Counsels - Regions I - X
PURPOSE
This memorandum states the policy of EPA for responding to
requests under the Freedom of Information Act (FOIA) for the
names of potentially responsible parties (PRPs) at CERCLA sites.
II. BACKGROUND
On March 30, 1983, EPA issued guidance on releasing the
identities of potentially responsible parties under CERCLA.
This guidance provided for case-by-case review and discretionary
disclosure of the identities of PRPs in certain limited circum-
stances. In general, before the March 30 guidance, EPA did not
release the names of PRPs in response to FOIA requests.
On June 28, 1983, the Federal District Court for the
District of Columbia decided, in Cohen v. EPA that EPA had not
met its burden of establishing that disclosing the identities
of PRPs would harm the Agency's enforcement efforts. The case
involved EPA's decision to withhold the identities of potentially
responsible parties as provided by FOIA exemptions under 5
U.S.C. SS552(b)7(A), 7(C), and 5.
The court granted the plaintiff's motion for summary
judgment on finding that:
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1. For Exemption 7(A) — notice letters are investigatory
records compiled for law enforcement purposes, but EPA did not
establish that disclosure of the notice letters would harm the
investigation;
2. For Exemption 7(C) — the identities of the PRPs
who received notice letters does not fall into the category of
a protected privacy interest; and
3. For Exemption 5 ~ notice letters are not predecisional
documents.
III. POLICY
As a result of the Cohen decision and the Administrator's
policy of conducting business in a more open atmosphere, and
in light of the resource demands involved in case-by-case
review of the names of notice letter recipients, the March 30,
1983, guidance has been reevaluated. The new guidance is set
forth below.
1. In response to a FOIA request, EPA will release the
names of PRPs who have received notice letters about a CERCLA site.
2. An exception to the policy of disclosing the names of
PRPs who received notice letters may be made only when EPA
•determines that disclosure of a particular name will cause such
interference with an ongoing enforcement proceeding that
discretionary disclosure is clearly unwarranted. If EPA decides
to withhold the name of a PRP who received a notice letter, EPA
must support the conclusion that disclosure will cause substantial
harm to the law enforcement proceeding in writing with concurrence
by the Regional Counsel. The written documentation may not
consist of general statements; it must include the particular
facts relating to the specific PRP and site that led to the
conclusion to withhold.
3 . The names of parties who have not yet received notice *
letters may be predecisional and therefore exempt from disclosure
under Exemption 5 of the FOIA. These names also may be exempt as
investigatory records under Exemption 7(A). However, in its
discretion EPA may release this material.
4. Although EPA usually will release the names of PRPs
only in response to FOIA requests, the Agency may elect to
release the information on its own initiative in appropriate
circumstances.
5. Disclosure of the names of PRPs and the names of sites
does not constitute a waiver of EPA's right to withhold other
information developed for an enforcement action that EPA determines
is exempt from disclosure. Even if informatipn is exempt from
disclosure under Exemption 2, 5, or 7 of FOIA, EPA has discretion
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to release the information; however, EPA may exercise its discretion
to release the information only after the appropriate Regional Counsel
reviews the information to ensure that disclosure will not interfere
with an enforcement action.
IV. PROCEDURES TO IMPLEMENT POLICY
EPA Headquarters or a Regional Office should follow the
procedure below to respond to a FOIA request for the names of
PRPs or other information about a CERCLA site.
1. Quality assure the list of PRPs regularly and particularly
before sending notice letters to PRPs for a site. Perform an
in depth quality assurance of PRP lists every 6 months. Headquarters
will hold Regional Offices accountable for inadequate quality
assurance of PRP information.
2. Immediately notify Headquarters whenever a Regional
Office decides/ in accordance with the guidance in Item III.2
above, that disclosing the name of a PRP will cause substantial
harm to an enforcement effort. Regional Offices also should
notify Headquarters if withholding a name is no longer required.
3. If additional information is requested about a PRP or
a site, consult with the Regional Counsel for a decision on
whether disclosure will interfere with enforcement at the site.
4. Submit the list of names, or names and information, to
the requester with a brief explanation of how EPA defines PRP
for purposes of sending notice letters.
5. Include with the list of names the following disclaimer:
This list represents EPA's preliminary findings on
the identities of potentially responsible parties.
EPA makes no assertions that parties on this list
are liable for any hazard or contamination at any
CERCLA site.
6. Use the term "potentially responsible party" in
responses to FOIA requests if none of the parties named in a
notice letter has been found liable by a court.
V. FIRST RES.PONSE TO FOIA REQUESTS
Ten working days after the date of this policy. Headquarters
will respond to the current backlog of requests for all PRP names
with the quality assured list.
Any Regional Office that intends to withhold any PRP names,
as provided by Item III.2 above, must have completed the required
documentation and notified Headquarters before the FOIA response
date. If you have any questions about this policy, contact
Susan Gary Watkins (FTS 382-2032).
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
FEB 2 I 1984
OFFICE OF
> SOLID WASTE AND EMERGENCY RESPONSE
MEMORANDUM
SUBJECT: Issuance of Administrative Orders for immediate Removal
'Actions
PROM: ^\Lee M. Thdmas
Assistant Administrator
TO: Regional Administrators, Regions I-X
Air 6 Waste Management Division Directors
Regions III, IV, VI, VII, VIII, X
Waste Management Division Directors, Regions I, V
Director, Office of Emergency and Remedial Response, Region II
Toxics and Waste Management Division Director, Region IX
Environmental Services Division Directors, Regions I-X
Regional Counsel, Regions I-X
This memorandum sets forth guidance on issuing Administrative
Orders for immediate removal actions under CERCLA. This guidance
should be used in conjunction with the recently issued Guidance
Memorandum on use and Issuance of Administrative Orders under
Section 106(a) of CERCLA dated September 8, 1983.
Since becoming the Assistant Administrator, OSWER, I have
sought to implement a "balanced" CERCLA program which uses both
the administrative and civil judicial enforcement provisions of
the Act—as well as the Fund—to secure clean up of hazardous
waste sites. One of my primary enforcement goals is to increase
the use of Administrative Orders for immediate removals. Orders
are particularly useful in immediate removal situations, since
they can be issued quickly, can require discrete segments of work
(e.g., surface cleanup) and carry the threat of additional damages
and penalties in the event of non-compliance.
We estimate that Administrative Orders may be appropriate for
a significant percentage of immediate removal situations. Increased
resources will be provided to the Regions, and I expect the Regions
to devote resources to accomplishing this goal of increased
Administrative orders for removals.
In addition, the Regions must develop a satisfactory
organizational structure if the Administrative order program is to
succeed. The organization of enforcement personnel varies among
the Regions. The majority of the Regions keep their "remedial"
and "removal" personnel in different divisions. Since CERCLA
enforcement has (until now) concentrated heavily on remedial
sites, most regional technical enforcement personnel have been
assigned to the remedial response units (generally, the Air and
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Hazardous Material Divisions). Personnel responsible for immediate
and planned removals have usually been assigned to the Environmental
Services Division which, as a general rule, has not been assigned
enforcement personnel.
Obviously, the ability of a Region to implement this new
policy requires both close coordination among the immediate
response staff and their colleagues in the technical enforcement
and regional counsel offices and an organizational structure
capable of developing and issuing quality orders. Regions that
do not currently dedicate technical enforcement staff to their
immediate removal program should assure that appropriate personnel
are in place in the technical enforcement office to implement this
policy and to handle the workload.
I. BACKGROUND
CERCLA identifies two types of response actions for which the
Fund can be used: removal actions and remedial actions. The
National Contingency Plan (NCP) further refines the former category
into "immediate" and "planned" removals and describes the process
and procedures for proceeding with these forms of response. (See
Federal Register 31180; July 16, 1982). Please refer to the attach?"
appendix for an outline of the relevant CERCLA and NCP provisions
regarding removal activity, Administrative Orders and enforcement.
Because of the large number of sites which pose a health hazard,
the Office of Emergency and Remedial Response (OERR) defines the
category of immediate removals according to the immediacy and
severity of the hazard to the public health or environment. These
categories establish a guide for the purpose of assessing the
length of time within which the Agency must respond to the event.
Agency response to situations which require immediate response
(e.g., threats of fire, explosion or spills) normally takes place
in a matter of hours or one or two days at the most; Agency response
to other situations (e.g., rusting barrels that have not yet
begun to leak, holding ponds that may overflow with the advent of
the rainy season) normally takes place during a period which may
range from a week to a month.
This guidance is most applicable to the latter situation; i.e.,
the Regions should consider issuing Administrative 'orders in situations
when there is at least one week between the time the On-Scene
Coordinator (OSC) determines that an immediate removal is warranted
and the time that actual on-site response must begin.
Administrative Orders are a useful enforcement tool in these
types of immediate removals situations, for the following reasons.
First, they encourage private party response, particularly since it
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is OSWER policy to meet, if at all possible, with responsible parties
after the Order is issued if a meeting is requested. The results
of an OWPE analysis of 49 completed immediate removals indicate
that the elapsed time between the request for funds and the start
of site response ranged from eight days to more than three weeks
for 24 of the sites. This clearly indicates that there is time to
issue Administrative Orders in appropriate situations, and the
process described in this memorandum can be implemented in as
little time as a week, if necessary. Second, removals require
discrete units of work (e.g., barrel or contaminated soil removal)
which makes responsible party compliance and Agency compliance
monitoring easier. Third, the costs of immediate removals are
generally moderate; this increases the probability of private
party compliance.
In the event of non-compliance with an Administrative Order,
the Agency is prepared to quickly initiate a Fund-financed response
and seek fines/treble damages from the responsible parties. Since
the treble damages will be based on the Fund dollars expended, these
situations are particularly amenable to establishing treble damage
claims, which the Agency will seek to recover in its $107
cost recovery actions. (The average obligation for 110 prior
immediate removals undertaken by the Agency was approximately
$275,000). Issuance of Administrative Orders for these situations
also may improve the equitable position of the Agency in subsequent
cost recovery cases.
II. CRITERIA FOR ISSUING ADMINISTRATIVE ORDERS
First, of course, the Agency must meet the legal threshold
that an imminent and substantial endangerment to public health or the
environment may exist.1 Information which can be used and evaluated
by the OSC or his supervisor to make this determination include:
1. Notification in accordance with CERCLA $103 (a), (b) or (c)
2. Investigations by government authorities conducted
pursuant to CERCLA $104 (e) or other statutory authority.
AThe Agency must be able to properly document and justify both its
assertion that an immediate and significant risk of harm to human
life or health or to the environment exists and its choice of the
ultimate response action at a site in order to be able to oppose a
challenge to the Order and to successfully litigate any subsequent
cost recovery action. Adequate documentation consists of photographs,
samples, monitoring or other documented site analysis. The Agency
should follow chain of custody procedures to maintain the integrity
of samples taken at the site. Please refer to the Cost Recovery
Guidance, issued August 26, 1983 for more detailed guidance. The
Revised Superfund Removal Guidance to be issued in late February
1984 will also provide additional guidance on immediate removal
assessments.
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3. Notification of a release by a federal or state permit
holder when required by the permit.
4. Inventory efforts or random/incidental observation by
government agencies or the public.
If the facts reach the legal thresholds of CERCLA $106,
several policy criteria for deciding whether to issue an Order
for an immediate removal should be considered. The first of
these is the amount of time available before site response must
begin. This determination will usually be made by the OSC. An
Order may be appropriate if there is a minimum of one week available
for issuing the Order and meeting with the recipients (see
further below) between the time of the decision to seek funds
for the immediate removal and the initiation of on-site response.
(Of course if an order can be issued in less than a week the
Regions are not bound by the "one week minimum". However, the
Regions should always attempt to have 48 - 72 hours available
for the recipients to request and conduct a conference.)
A second policy criterion is the number of potential reci-
pients of the Order and their financial viability. There should
be a "manageable" number of responsible parties and they should
be collectively capable of undertaking site response. The Regions
will use their best judgement to decide what constitutes a
"manageable" number of responsible parties and assess the capability*
of the parties^ to undertake the response for any individual
immediate removal situation. (For a more lengthy discussion of
criteria to consider when issuing an Administrative Order, please
refer to the Administrative Order guidance.) When there is a
large number of potentially responsible parties, Orders need not
be issued to all of the parties. In this type of situation the
Region should issue the Orders only to those parties most likely
to comply. The Region, however, is not precluded from issuing
Orders to all the parties if it so desires.
These criteria are to be used as general guidelines for deter-
mining whether an Administrative order should be issued for an
immediate removal. The varying factual circumstances presented
in any potential removal action mandate that each Region conduct
this necessary factual analysis to decide the appropriateness of
an Order.
III. PROCESS FOR ISSUING ADMINISTRATIVE ORDERS
The timely development and issuance of Administrative Orders
for immediate removals will require effective coordination among
the OSC, technical enforcement personnel and the legal counsel
in both the Regions and Headquarters. OSWER will not dictate how
the Regions must organize or adjust personnel in order to
accomplish this task, but it will expect the Regions to have a
system in place which is capable of implementing an administrative
order program for immediate removals.
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The procedures for developing and issuing orders follow:
The decision by the OSC or his superior to request funds for
an immediate removal also triggers the process for deciding whether
to issue an Administrative Order.
The OSC will inform the technical enforcement branch (or other
appropriate enforcement personnel if no separate branch exists)
and the Regional Counsel that a request for a Fund-financed immedi-
ate removal is being developed. Appropriate personnel in OERR and
OWPE should also be informed of this action. While the OSC and his
staff prepare the 10-point document,2 technical enforcement personnel
and the Regional Counsel should begin to identify responsible
parties and assess their financial ability to conduct site cleanup.
The OSC or the Regional Counsel will attempt to orally contact
(with written follow-up) potentially responsible parties in order
to secure private-party response in lieu of the Fund. While previous
Agency policy was to proceed with Fund-financed response if the
responsible parties refused to act, the Agency will now issue
administrative orders in appropriate circumstances before initiating
Fund action, so long as the site does not pose an unreasonable
risk of harm to the public health, welfare or the environment.
Regardless of whether a responsible party agrees or not to
undertake the removal, development of the 10-point document should
proceed as usual. However, the OSC and technical enforcement staff
(in consultation with the Regional Counsel) shall apply the criteria
outlined in Part A (above) to recommend to the Regional Administrator
whether to issue an Administrative Order. The decision to issue
the order rests with the Regional Administrator, subject to the
current delegations.
If the Regional Administrator decides to issue an Administra-
tive Order, the Order will be drafted by technical enforcement
personnel with the advice of the Regional Counsel. The technical
information contained in the 10-point document will normally
provide the basis for the Order's "Findings of Fact." while the
Agency's intended response actions will serve as the remedy the
recipient is required to implement.
^Requests for less than $250,000 can be approved by the Regional
Administrator while requests for more than $250,000 require the
approval of OERR. (It is anticipated that within the month, the
Regional Administrators will be delegated the authority to obligate
up to $1 million for removal actions.) The ten point document
itself must justify its cost estimates and be consistent with the
NCP. With the issuance of the Revised Superfund Removal Guidance,
the 10 point document will become an Action Memorandum.
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Since Administrative Orders will normally be issue'd in situa-
tions in which site response is not required for at least one
week, OSWER policy is to provide recipients when possible an
opportunity to meet with Agency personnel to discuss the terms of
the Order and the means for compliance. Therefore, the Order
should include the following provisions:3
1. A statement of the imminent and substantial danger
pursuant to §106 of CERCLA and the risk of harm under
§300.65 of the NCP.
2. A statement of the authority of the issuing official
(normally the Regional Administrator) to issue the
Order and why the recipient is liable under §107.
3. The steps the recipient must take to comply with the
order, (following the provisions of the
ten-point document in order to be as specific as
possible).
4. A mandatory timetable for performing and completing
the response. (The timetable should include at least
one short term interim deadline so the Agency will have
the ability if necessary, to demonstrate non-compliance
before the project completion date.)
5. A provision informing the recipient that his duty to c
the terms of the order takes effect 72 hours after he
receives the order.
6. A provision informing the recipient that he may orally
contact the Agency to request a conference on the
Order. The recipient must follow up his oral request
in writing.
7. A provision specifying a date certain by which responses
(either oral or written) to the Order must be received.
8. A provision which states that EPA reserves the right
to undertake the action if emergency circumstances
dictate such action and that such action in no way
relieves the parties of responsibility for the costs
of such actions.
9. A provision which requires: proper chain of custody
procedures to be followed for any testing and sampling,
adequate recbrdkeeping of activities (so records may be
used as evidence in any future enforcement case),
cooperation from employees of any contractor who engages
in site activity, and availability of such employees
to the U.S. in preparation and trial of a subsequent
enforcement case.
3Refer to the general Administrative Order Guidance for examples
of model orders and conference procedures.
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Under a separate delegations memorandum to the Regions, the
concurrence requirement will be waived for all Administrative
Orders for immediate removals with obligations of $1,000,000 or
less. Within two weeks of issuance of the Order, the Regions are
to send a copy of the final Order to OWPE.
As a matter of policy, in order to increase the likelihood of
compliance, the Agency encourages the convening of a conference
with the recipients of an Administrative Order. Since
Administrative Orders will generally be issued for immediate removal
situations which do not require response in less than one week,
the Agency will normally attempt to hold a meeting with the recipient,
if requested by the recipient. The conference should be
convened on an expedited basis (e.g., within 72 hours after the
Order is issued) if the recipient orally requests the conference.
However, the Agency retains the right to "waive" a conference
if immediate response is warranted because of deteriorating conditions
at the site. The Regional Administrator shall have the authority
to decide whether to eliminate the conference prior to or following
the issuance of the Administrative Order. If the Regional Administrator
waives the opportunity for a personal conference, a regional
representative, must at least give the .parties an opportunity to
be heard by telephone before the effective date of the Order. In
general, conferences concerning removal actions should be used to
clarify the requirements of the Order rather than as an opportunity
to negotiate the requirements. . .
The Agency must create a good administrative record of its
meetings with the recipient of an Order for either enforcement of
the Order or cost recovery after a Fund-financed cleanup. The
Agency participants should prepare a written summary of the
conference containing:
1. The date and participants.
2. A summary of the significant issues raised and arguments/
data used by the recipient to contest the Order.
3. The result of the conference (e.g. agreements reached
with the recipient, indication from the recipient of
an unwillingness to comply with the Order)
The presiding official, (designated by the Regional
Administrator) must also prepare a statement which addresses any
significant arguments raised by the recipient and recommends whether
any modifications to the Order are warranted. (See the September
8, 1983 Administrative Order Guidance for a complete discussion of
the procedures and "ground rules* for conducting the conference
and the time frames for holding them.)
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If the recipient agrees to undertake the stipulate'd response
measures, the agreement may be in the form of a Consent Order. The
OSC will monitor compliance with the Order and recommend additional
enforcement action if the terms of the Consent Order are breached.
If the recipient does not agree to undertake the measures contained
in the Order, the Agency will generally not refer a case to the
Department of Justice to force compliance because of the time
constraints presented by the emergency. Rather, the Fund will be
used for site response and the recipient(s) will be sued for cost
recovery—including punitive damages in appropriate cases.
IV. USE OF THE FUND WHILE THE ADMINISTRATIVE ORDER IS BEING ISSUED
Normally, once an Order has been deemed appropriate for an
immediate removal situation, the CERCLA Fund shall not be used to
undertake a federally-funded immediate removal during the time
period in which the Agency develops the Order, issues it to the
responsible party, and conducts the conference.
However, if site conditions deteriorate— presenting a corre-
sponding increase in the threat that the site presents— the Fund can
be used for response while the Administrative order process continue
In such instances, the Regional Administrator can approve the use
of Funds below $250K and request the Assistant Administrator, OSVPR.
to release funds if the response work will be greater than $250K.4
The Administrative Order process should continue since the parties
may undertake site response at the next convenient break in activity.
Thus, if there are deteriorating conditions at the site, the
OSC should continue all steps necessary for undertaking a Fund-
financed response while the Order is being developed. The 10-point
document should be prepared and receive the concurrence of all
officials up through the Regional Administrator or the Director,
OERR.
However, no actual obligation of Funds for site response will
normally occur until after the Order has been issued and the con-
ference has been held. Since the Order will only be issued in
situations where an immediate response can be delayed, there will
normally be time to see the Administrative Order process through
to conclusion. The conference must be held within the time period
specified in the order (which will correspond to the time the
Agency has before the response activity needs to begin). Since
deteriorating conditions require the Fund to respond wniie
the Order is still being issued, OSWER assumes that the Fund will
take all response actions necessary at the site (e.g., remove all
barrels, not merely those that may be about to leak).
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the timing of the obligation will vary according to the'estimated
time needed to mobilize equipment and personnel, the OSC should
work closely with the technical enforcement and Regional Counsel
staff during the drafting of the Order to assure that the time
period established for issuing the Order is synchronized with the
time requirements for site response.
If the conference does not result in private party response—or
if changing conditions at the site require accelerated response—the
Fund-financed immediate removal will take place. If Fund-financed
activity does begin, the Order may be written to require the potentially
responsible parties to undertake site activity at the next convenient
break point in activity. If the parties still fail to undertake
the site response activity, enforcement efforts will emphasize cost
recovery with the additional imposition of fines/penalties as
appropriate.
V. COST RECOVERY
The Agency will normally not initiate a civil action in the
event of non-compliance with an Order but instead will seek to
recover costs and damages after a Fund-financed response. Therefore,
while enforcement personnel are carrying out the Administrative
Order process, they should also be aware of the requirements for. a
successful cost recovery action. They must be able to document
the following factors (some of which are the same ones necessary
for the issuance of the Administrative Order itself).
1. The need for the immediate removal (evidence of an imminent
and substantial endangerment or threat of endangerment
to public health, welfare or the environment)
2. Liability of the responsible parties (evidence to support
the contention that the parties meet the liability standard
of 5107)
3. Proof that the Fund-financed response activity was "not
inconsistent" with the requirements of the NCP.
4. Documentation of all eligible costs for site-specific Fund
expenditures.
Enforcement personnel must assure sufficient documentation of
these factors from the period in which the 10-point document is
developed and Funds are obligated through the actual clean up of
the site. These cost recovery requirements must be met regardless
of whether there will be a simple cost recovery action (if no
Administrative Order is issued) or an action for response costs plus
damages (if the Order is not complied with). The Agency must
assure that evidence is preserved for any subsequent enforcement
action. Proper chain of custody procedures must be used for any
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-10-
sampling or testing, and adequate records of site activity must be
kept. Employees of any contractor used for site activity must
cooperate with and be made available to the U.S. in preparation
and trial of any subsequent enforcement action. Enforcement,
program and legal offices should work together throughout the
case development.
VI. FOLLOW-UP
This guidance represents a substantial departure from prior
practice, and I expect that it will take some time to implement.
For these reasons, I will be reviewing all immediate removals
referred to Headquarters for compliance with this guidance. In
addition, for immediate removals under $250,000, I will ask the
Directors, OWPE and OERR to review the compliance with this guidance
quarterly, and to advise me accordingly.
Appendix
cc: Gene Lucero, OWPE
William Hedeman, OERR
Kirk Sniff, OECM
ban Berry, OGC
171
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APPENDIX
Authority/Requirements/Enforcement of Administrative Orders
for Removal Actions under CERCLA
Under $106(a) of CERCLA:
If, EPA, acting on behalf of the President:
determines that there may be an imminent and substantial
endangerment to the public health or welfare or the
environment because of
an actual or threatened release of a hazardous substance
from a facility
may, after notice to the affected state,
issue such orders as may be necessary to protect
public health and welfare and the environment.
Under S106(b) of CERCLA:
EPA may take action in the appropriate U.S. district
court, against any person who willfully violates or
fails or refuses to comply with any Order issued under
$106(a), to enforce such order and
may fine such person not more than $5,000 for each day
such violations occur or such failure to comply continues.
Under $107(c)(3) of CERCLA:
Any person who is liable for a release or threat of release
of a hazardous substance that:
fails without sufficient cause to properly provide
removal action upon order of the president pursuant to
S106
may be liable to the United States for punitive damages in
an amount at least equal to and not more than three times,
the amount of any costs incurred by the Fund as a result
of such failure to take proper action.
Civil action may be commenced against any such person to
recover the punitive damages. These punitive damages shall
be in addition to any costs recovered from such person
pursuant to $H2(c).
Any monies received in punitive damages shalL be deposited
in the Fund.
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APPENDIX PAGE 2
National Contingency Plan Requirements for Immediate Removals
Under §300.65 of the NCP:
Immediate Removal action is appropriate when the lead agency
determines that:
the initiation of the removal action will prevent or
mitigate immediate and significant risk of harm to
human life or health or to the environment from such
situations as:
1. Human, animal, or food chain exposure to
acutely toxic substances
2. Contamination of drinking water supply
3. Fire and/or explosion
4. Similarly acute situations
Immediate removal action may include but are not limited to:
1* Collecting and analyzing samples to determine
the source and dispersion of the hazardous
substance
2. Providing alternative water supplies
b
3. Installing security fencing or other measures
to limit access
4. Controlling the source of the release
5. Measuring and sampling
6. Moving hazardous substances off-site for storage,
destruction, treatment or disposal
7. Placing physical barriers to deter the spread
of the release
8. Controlling the water discharge from an upstream
impoundment
9. Recommending to the appropriate authorities
the evacuation of threatened individuals
10 * Using chemicals and other materials in accordance
with Supart H to restrain the spread of the
substance and mitigate its effects
11. Executing damage control or salvage operations
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\
-*
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, O.C. 204«0
HAR , 8 HP*
OMICI Of
•OLIO WACTI AND •MIMQINCV
MEMORANDUM
SUBJECT: Delegation of Authority to Issue Demand Letters
PROM:
Office of Haste Programs Enforcement
TO: Regional Administrators, Regions I - X
Directors, Air 6 Waste Management Division
Regions III, IV, VI, VII, vili, x
Directors, Waste Management Division
Regions I, V
Director, Office of Emergency and Remedial Response
Region II
Director, Toxics and Waste Management Division
Region IX
Directors, Environmental Services Division
Regions I - X
Regional Counsel, Regions I - X
Purpose
This memorandum formally transfers the authority to issue
demand letters for recovering costs of CERCLA response actions
from the Director, Office of Waste Programs Enforcement to the
Regional Administrators.
Background
Where CERCLA funds are expended the Agency will attempt to
recover response costs from the party or parties who are liable
under section 107 of CERCLA. w The first formal step- in recovering
Trust Fund expenditures is the issuance of a demand letter from
EPA to the responsible party or parties for payment of response
costs. Up to now, the Regional Office has been responsible for
preparing the demand letter and sending it through the Office of
Waste Programs Enforcement for signature and issuance by the
Director. Now that Headquarters has provided guidance and held
workshops on cost recovery actions, the necessity of Headquarters'
role in the issuance of demand letters has declined.
Pol icy
Effective immediately, Regional Administrators have authority
to issue demand letters in CERCLA 107 Cost Recovery cases. Mo
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review or advance concurrence from EPA Headquarters will be
necessary. Regional Administrators may further delegate
authority for issuance of demand letters to the appropriate
Regional Division Director.
Demand letters may be issued after all appropriate
documentation on and accurate summaries of removal costs are
available (See Chapter S of Draft Cost Documentation Procedures
Manual, September 1983) and generally should be issued before
the Cost Recovery case is referred to EPA Headquarters.
EPA Headquarters will not accept a Cost Recovery referral
package that does not include a copy of the demand letter and
response. Headquarters will make exceptions to this policy
only for Cost Recovery cases that are referred to Headquarters
prior to April 1, 1984 or cases for which the Region provides
a statement with the referral package explaining why a demand
letter was not issued. If the case is then referred to the
Department of Justice for litigation, DOJ will ordinarily issue
a demand letter befpre filing the case.
Procedures for preparing and issuing demand letters are
contained in the following EPA guidance documents: "Guidance
on pursuing Cost Recovery Actions under CERCLA" (August 1983,
pp. 20-30) and "Cost Documentation for CERCLA 107 Efforts"
(September 1983, p. 8).
cc: William N. Hedeman, OERR
Kirk P. Sniff, OECN
Lisa K. Friedman, OGC
Glenn Unterberger, OLEP
175
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
E 0 1984
MEMORANDUM
SUBJECT
FROM:
TO:
Participation of Potentially Responsible Parties in
Development of Remedial investigations and Feasibility
S tud i gs-yunde r CERCLA
— v ^ — \V«^Xjxi»-tr)
Lee M. Thomas, Assistant Administrator
ice of Solid.i?a.ste and Emergency Response
iTtneyti. Price, Assistant Administrator
Office of Enforcement and Compliance Monitoring
Regional Administrators, Regions I-x.
I. Introduction
This memorandum sets forth, the policy and procedures
governing participation of potentially responsible parties (PRPs)
in development of .remedial investigations (RI) and feasibility
studies (FS) under the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA). 1 It discusses:
o the circumstances, in which RI/FS may be conducted by potentially
responsible parties,
o the procedures for notifying potentially responsible parties
when the Agency has identified target sites for the development
of RI/FS, and
o the principles govern.ing PRP participation in Agency-financed
RI/FS.
l.The Agency is currently developing a comprehensive policy
concerning EPA participation in state-lead enforcement under
CERCLA. The applicability of the RI/FS policy to state-lead
enforcement actions will be fully discussed in this forthcoming
memorandum.
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II- Previous Approaches to PRP Participation in RI/FS
Under earlier policy, the Agency negotiated with potentially
responsible parties (PRPs) for individual phases of site response
(i.e., RI/FS, design, construction). PRPs could negotiate to
conduct the RI/FS without discussing the remedial design and
construction. Fund-financed RI/FS were generally not performed
until the Agency concluded that negotiations with private parties
were unsuccessful. Negotiations concerning later phases of
remedial action would occur after the RI/FS was completed.
This approach was designed to secure cleanup by PRPs instead
of Superfund financed cleanup, if privately financed cleanup
could be accomplished in a timely manner. This policy was
initially expressed by EPA in the "Guidelines for Using the
Imminent Hazard, Enforcement and Emergency Response Authorities
of Superfund and Other Statutes" issued pursuant to §106(c) of
CERCLA at 47 Fed. Reg. 20664 (May 13, 1982).
The Agency identified several drawbacks to the approach
of negotiating for individual phases of the cleanup:
First, the negotiations for the RI/FS were often unsatisfactory
because of frequent disagreements on the nature and scope of the
RI/FS. In particular, protracted negotiations occurred over the
details of investigating the hazard, both on and off-site.
Disagreements also arose over sampling locations and frequency,
well placement, analytical methods, quality control, and level
of detection. Substantial delays occurred even "when agreement was
eventually reached.
Second, some RI/FS conducted by potentially responsible
parties were, inadequate and of little use to EPA in determining
the extent of the remedy for a site. Because the Agency had not
published guidance on conducting RI/FS, the only way to avoid
these problems was for the Agency to provide extensive oversight
and review of the RI/FS under development. In certain instances,
the PRPs revised the completed RI/FS after further discussions
with the Agency, or the Agency redid the RI/FS using .CERCLA
funds. These inadequacies and revisions demanded resources from
the Fund and delayed site response.
Third, the Agency's willingness to negotiate with potentially
responsible parties for the RI/FS for any or all sites affected
the pursuit of the Agency's priorities. Occasionally, resources
were diverted from on-going litigation, or the initiation of
action at sites where prompt response was desirable. Priorities
for the use of the Agency's enforcement resources were established
on a "de facto" basis by PRPs, based upon their willingness to
negotiate at particular sites, rather than on the Agency's assessment
of the sites which needed to be addressed in a timely fashion
and offered the best prospects for privately-financed response.
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Finally, multiple negotiations concerning each phase of site
response inefficiently used limited Agency and Department of
Justice resources and personnel.
In response to these concerns, the Agency established a
po'licy that precluded potentially responsible parties from conducting
the RI/FS, unless they were also willing to commit to conducting
the remedial action.
The Agency has also identified drawbacks to this approach.
Some potentially responsible parties have wanted an opportunity
to prepare an RI/FS or participate in its development. They have
been reluctant to accept the conclusions in the RI/FS and to
assume responsibility for conducting cleanup, because their views
were not reflected in the Agency-financed RI/FS. This policy
also increased demands on the Fund, and ran contrary to the
Agency's preference for timely and effective private-party response.
In light of these drawbacks, the Agency has established a
new policy concerning the conduct of RI/FS by PRPs. The Agency
will give potentially responsible parties an opportunity to
conduct the RI/FS, consistent with Agency priorities and with
new Agency procedures and guidance. The new approach will better
enable the Agency to target its enforcement priorities, reduce
the possibility of unsuccessful or protracted negotiations with
PRPs, and enhance the quality of private-party RI/FS.
Ill. Situations where private parties may conduct RI/FS
The Agency will identify sites targeted for RI/FS development,
and give potentially responsible parties an opportunity to conduct
the RI/FS. -The Remedial Accomplishments Plan (RAP) developed by
the Agency identifies candidate sites for enforcement or Fund-financed
response, and allocates the resources necessary to undertake
these activities. The Remedial Accomplishments Plan lists all
sites for which RI/FS will be developed.
Approximately 95 sites from the National Priorities List
have been identified as targets for development of RI/FS in FY
1984, and about 115 will be identified for FY 1985. The Agency
has allocated CERCLA funds for RI/FS for each of these sites.
EPA will make available a list of the sites on the Remedial
Accomplishments Plan, and the scheduled dates for obligation of
funds for RI/FS development by the Agency at these sites.
Potentially responsible parties will have an opportunity to
conduct the RI/FS for these sites, provided that they respond
before the scheduled date for obligation of funds.
The Agency will not engage in lengthy negotiations with PRPs
over whether PRPs will conduct the RI/FS. In setting a reasonable
negotiating period, the Agency will consider factors specific to
the site, such as technical complexity and the number of parties
involved. Once funds for an Agency-financed RI/FS have been
obligated, PRPs will not be allowed to take over development of
the RI/FS.
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If potentially responsible parties are willing to perform the
RI/FS, the Agency will identify the conditions under which they
may do so. To assure that privately-funded RI/FS are done quickly
and in a manner that meets the applicable requirements of this
policy, potentially responsible parties will be expected'to meet
the following conditions:
1. Where several parties are involved at a site, they
must be able to quickly organize themselves into a
representative body to deal with the Agency as a single
entity. To facilitate this process, the Agency will
make the names of potentially responsible parties
available on request. (See guidance.from Gene A. Lucero
and Kirk Sniff on Release of Names of Potentially
Responsible Parties in Response to FOIA Requests published
January 26, 1984). A single PRP, or an organized group
of PRPs, may assume responsibility for actual development
of the RI/FS.
2. PRPs must agree to follow the scope of work for the
RI/FS developed by the Agency. The Agency will noj:
engage in lengthy negotiations over this issue.
3. PRPs must demonstrate to the Agency that they are able
to follow the technical procedures described in Remedial
Investigation and Feasibility Study guidance manuals -
currently'under development.2
If these conditions are met, the Agency will devote the
resources necessary to assure the satisfactory development of
the RI/FS by private parties. The conditions governing private-
party conduct of the RI/FS should be formalized as Administrative
Orders (either unilateral or on consent) or Consent Decrees
wherever possible.3 The Agency is developing a model "generic"
consent order for privately-conducted RI/FS so that consistent
and complete agreements can be expeditiously negotiated.
2. The Feasibility Study guidance and the Remedial Investigation
guidance are scheduled for completion in the summer of 1984.
3. EPA may issue orders under section 106 when it determines that
there may be an imminent and substantial endangerment to public
health or welfare or the environment. The Regions should
review and if necessary update the information gathered to
justify the listing of a site on the National Priorities List.
This information will be valuable in developing the endangerment
assessment needed to justify issuance of the order.
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If, in the Agency's judgment, the potentially responsible
parties do not meet these criteria (that is, they are not able
to properly conduct the RI/FS), the Agency will not commit resources
to review the private-party RI/FS. Instead, the Agency will
perform the work itself and seek to recover the costs of the
RI/FS. PRPs will be given the opportunity to discuss implementation
of the selected remedy at a later date.
The Agency normally allocates the equivalent of about 1.1
work-years for start-up, management, and selection of remedy for
each Fund-financed RI/FS developed by a government contractor.
These resources will be redirected to oversee and review the
privately-conducted RI/FS. It is the Agency's view that
responsible parties are liable for costs of oversight of RI/FS
development. A commitment to reimburse the Agency for oversight
costs should be negotiated in advance.
The Agency will review the completed work product, assess
the various alternatives under consideration, and choose the
remedial alternative that best meets all applicable.requirements
of CERCLA. Development of private-party RI/FS will be subject
to EPA community relations requirements. 4
The Agency believes that this approach will enhance the
prospects for private-party implementation of the remedy and
also provide a mechanism to clean up additional sites in the
future. As potentially responsible parties become more familiar
with conducting RI/FS under the Remedial Investigation and
Feasibility Study guidances, and Agency personnel develop more
experience in overseeing and evaluating them, we anticipate that
it will take" less than a full Agency workyear to assure the
completion of a technically sound RI/FS. As a result of this
experience, EPA will be able to oversee additional privately-financed
RI/FSs with a given level of resources and, consequently, initiate
the response process by private parties at more NPL sites.
IV. Applicability of Policy
This policy is prospective. PRPs will be allowed to conduct
RI/FS for targeted sites on the basis of these criteria when the
Remedial Investigation and Feasibility Study technical manuals
and any other necessary technical manuals are final. We anticipate
that these documents will be completed in the summer of 1984.
. This policy will also be applicable to sites where States
have the lead in managing preparation of the RI/FS. Where possible,
States should be involved in the determination of whether PRPs
can properly conduct the RI/FS, and in review of the workplan.
States may also assume some responsibility for oversight of PRP
conduct of the RI/FS.
TIRequirements are set forth in Community Relations in Superfund;
A Handbook (Interim Version,) September 1983.
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This policy is applicable to sites that the Agency has
identified as targets for RI/FS development in the Remedial
Accomplishments Plan. The Agency will not provide resources to
oversee and evaluate RI/FS for sites that have not been so
designated. While potentially responsible parties are free to
conduct their own RI/FS for other sites which have not been
listed as priorities, the Agency does not have sufficient resources
to provide assistance or review the RI/FS during their development.
This exclusion is designed to allow the Agency to manage
its resources and assure that they are directed towards sites
that represent the Agency's priorities. Thus/ the Agency cannot
review private-party RI/FS for non-targeted sites to provide
assurances that the remedy selected by potentially responsible
parties will be adequate to meet the requirements of CERCLA.
V. Interim Policy and other situations for private-party RI/FS
Until the RI and FS guidance documents are made final,
potentially responsible parties may also develop RI/FS if they
commit to follow workplans for RI/FS that have been prepared by
the Agency contractors under the supervision of the Agency. The
Agency will not negotiate the content of these workplans.
Implementation of this- interim policy is at the discretion of
the Regions. Regions may allow PRPs to conduct RI/FS under
workplans developed by Agency contractors if the RI/FS can be
conducted without undue disruption to schedules for remedial response,
in light of existing commitments for activities to be undertaken
under the Fund. Regions should complete any negotiations concerning
this interim policy before the last month of the fiscal year, to
assure that these negotiations will not interfere with use of
Fund resources. Where the State is managing the development of
the RI/FS, this interim policy may be applied at the discretion
of the State.
The Agency will sanction private-party RI/FS for sites that
are not identified on the Remedial Accomplishments Plan in two
other situations.
First, private parties may perform the RI/FS if they also
agree to design and implement the remedy selected by the Agency
for the site. The Agency will allow private party development
of the RI/FS because the resources that would have been dedicated
to negotiations with potentially responsible parties for the
remedial design and construction can instead be used to oversee
and review the privately-conducted RI/FS. Thus, PRPs may conduct
the RI/FS for any NPL site (even if the site is not listed in
the Remedial Accomplishments Plan) if they commit to the complete
clean up as well.
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Second, the Agency will allow a private party RI/FS for
dioxin sites that are active facilities, where the scope of the
remedial investigation has been comprehensively defined by the
Federal government. The explicit requirements developed by the
Federal government—coupled with the public interest to move
quickly on recently discovered dioxin sites—warrant this approach.
VI. Arrangements for Notice to PRPs
PRPs will be notified of the opportunity to perform the
RI/FS in the following way:
First, the list of sites targetted for RI/FS development
and a schedule for action at those sites will be made available.
It will be accompanied by a statement .that the Agency plans to
conduct RI/FS for the sites. Any potentially responsible party
that wants to undertake the RI/FS can voluntarily come forward
and contact the Agency, before the scheduled date to obligate
funds for RI/FS development.
Second, prior to the scheduled start of the RI/FS, the
Agency will send notice letters to PRPs for sites listed on the
Remedial Action Plan. Notice letters should be issued as soon
as possible after the completion of the responsible party search.
The letters should normally be issued at least 60 days before
the scheduled date for obligation of Funds -for the RI/FS. PRPs
(if multiple generators are involved) should therefore have
sufficient time to organize themselves and initiate preliminary
contacts and discussions with Agency personnel. This will also
avoid delay in beginning a Fund-financed RI/FS should it become
necessary.
The notice letters will inform the potentially responsible
parties that:
1. Fund-financed RI/FS actions are planned;
2. The results of the studies will be used to select
a remedy for the site;
3. PRPs can meet with Agency personnel to discuss their
participation in the RI/FS;
4. PRPs may be liable for the costs of the RI/FS performed
by the government;
5. PRPs will have an opportunity to meet with Agency
personnel to discuss design and implementation of the
remedy after completion of the RI/FS.
*
6. PRPs may conduct RI/FS if they comply with the conditions
outlined in section III of this policy.
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The Agency will develop revised Notice Letter guidance in
the near future that will provide additional detail on these
requirements.
VII. Regional Role in RI/FS Development by PRPs
Regional review of private-party RI/FS will be intensive
when this policy is first implemented. Implementation will
require the ongoing involvement of the EPA project officer in
the private-party RI/FS development. The PRPs must develop a
detailed statement of work and work plans describing the activities
they will undertake at the site, based on the guidance and the
scope of work developed by the Agency. The Regions must arrange
to periodically review the work plans and work performed as part
of the RI/FS. The Regions must assure that PRPs follow proper
chain of custody procedures in testing and sampling, and that
PRPs keep adequate records to enable the government to use these
records as evidence in an enforcement case. In addition, employees
of contractors or others who do the work must cooperate with and
be made available to the government in the preparation and trial
of any subsequent enforcement case.
The Agency will review the completed work product and choose
a remedial alternative that meets all applicable requirements of
CERCLA, and all implementing regulations, policies and guidance-.
In addition, the Agency retains the right to reject PRP RI/FS
and sue PRPs for cost of developing its own Fund-financed RI/FS,
if the RI/FS is inadequate. As noted earlier, the agreement to
conduct a private-party RI/FS should be incorporated into an
administrative order or consent decree. Section 107 of CERCLA
authorizes the imposition of treble damages for failure to comply
with an administrative order. The Agency will develop a model
order providing additional detail regarding EPA involvement in
private party RI/FS development.
VIII. Private-party Participation in Agency-Financed RI/FS
Where potentially responsible parties do not actually develop
the RI/FS, the Agency will allow private-party involvement in
Fund-financed RI/FS, if such participation can occur without
undue delay, expense, or interference with Agency RI/FS development
Private parties may possess technical expertise or knowledge
about a site which would be useful in developing a sound RI/FS.
Involvement by PRPs in the development of a Fund-financed RI/FS
may also expedite site cleanup by identifying and satisfactorily
resolving differences between the Agency and private parties
that might otherwise be the subject of litigation.
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Potenttally responsible parties may be allowed to:
]. Review the contractor's technical work plan;
2. Have access to the site (if legally feasible) to observe
well installation and the collection of samples, and to
split samples where appropriate;
3. Have access to raw data and to draft reports;
4. Have the option to comment on each major phase of the RI/FS
during the conduct of the investigation.
The final decision whether to permit potentially responsible
parties to participate in the Fund-financed RI/FS (as well as
the scope of any participation) rests with the Regions. This
decision should be based on the ability of PRPs to organize
themselves so that they can participate as a single entity,
and the ability of PRPs to participate without undue interference
with or delay in completion of the RI/FS, and other factors
that the Regions determine are relevant. The Region may terminate
PRP participation in RI/FS development if unnecessary expenses
or delays occur.
Certain aspects of this policy are not applicable immediately,
and supplementary guidance will be published. If you have any
questions or comments concerning this policy, or problems that
need to be addressed in further guidance to implement this policy,
please contact Gene A. Lucero (382-4814), or John Cross on his
staff (FTS 382-4829) .
cc: Regional Counsel
Regions I-X
Directors, Waste Management Division
Region I, V
Director, Office of Emergency and Remedial Response
Region II
Director, Hazardous Waste Management Division
Region III
Directors, Air and Waste Management Division
Regions IV, VI, VII, VIII, X
Director, Toxics and Waste Management Division
Region IX
184
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* KB •>£
5 UNITED STATES ENVIRONMENTAL PROTECTION AUENCY
WASHINGTON. D.C. 20460
MAY £4 1984
OFFlCt Of
ENFORCEMENT AND
COMPLIANCE MONITQPINb
MEMORANDUM
SUBJECT: Guidance Regarding CERCLA Enforcement^Against
Bankrupt Parties /-\
(\
FROM: Courtney M. Pricev—-CU-c.
Assistant Administrator for'Enforcement
and Compliance Monitoring
TO: Regional Administrators, I-X
Regional Counsels, I-X
Lee M. Thomas, Assistant Administrator for
Solid Waste and Emergency Response
The attached guidance has been developed to assist the
Regions in developing CERCLA enforcement actions against bankrupt
parties. The guidance is intended to encourage aggressive
enforcement against insolvent parties and insure national
consistency in current and future bankruptcy cases brought by
the Agency.
The guidance provides: 1) an overview and summary of the
Bankruptcy Reform Act and existing bankruptcy case law; 2) a
discussion of enforcement theories available to the Agency to
pursue insolvent parties under CERCLA; and 3) references to
current bankruptcy pleadings and appeals filed by the Agency.
Pages 24 and 25 of the attached guidance describe referral
procedures for a proof of claim in bankruptcy. A bankruptcy
referral will ordinarily be processed in the same way as other
hazardous waste referrals. However, expedited Headquarters and
DOJ concurrence and abbreviated referral packages may be neces-
sary and acceptable if required to meet deadlines in bankruptcy
cases.
If you or your staff have any further questions regarding
CERCLA enforcement against bankrupt parties, please contact
Kirk Sniff at (FTS) 382-3050 or Heidi Hughes at (FTS) 382-3109.
Attachment
185
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INFORMATION REGARDING CERCLA
ENFORCEMENT AGAINST BANKRUPT PARTIES
TABLE OF CONTENTS
PAGE
I. INTRODUCTION 1
A. Scope and Duration of the Problem 1
B. When to Proceed Against a Bankrupt
Party 2
1. Probability of Recovering the Cost
Litigation 2.
2. Deterrence of Frivolous or Fraudulent
Bankruptcy Filings 3
II. THE BANKRUPTCY CODE: An Overview 4
A. Organization of the Code 4
B. Voluntary vs. Involuntary Bankruptcy 5
III. CERCLA AND BANKRUPTCY ACTIONS 6
A. Proceedings in District Court or
Bankruptcy Court 6
B. Cost Recovery Under Section 107 of CERCLA 11
1. Distribution of Assets 12
(a). Secured Creditors 12
H>) Priority Structure 13
2. Theories of Recovery Beneficial to
the United States 15
(a) Administrative Costs 15
(b) Recovery Under Section 506(c)
of the Code •. 17
(b) Equitable Liens 18
(d) Restitution 18
C. Other Matters in Bankruptcy and
Insolvency Cases 19
1. Abandonment of Property..... «... 19
2. State Involvency Laws 23
186
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IV. PROCEDURES 24
A. Rules of Bankruptcy Procedure 24
B. Filing Proof of Claims 25
C. Pleadings 27
D. Appeals 27
E. Federal Bankruptcy Court
Jurisdiction 28
V. THEORIES OF INDIVIDUAL LIABILITY 30
A. Personal Involvement in Acts
and Omissions 31
B. Piercing the Corporate Veil 33
C. Personal Jurisdiction in Cases Involving
Corporate Officers or Shareholders 35
VI. INDEX OF RESOURCES 36
PLEADINGS 36
Proofs of Claim 36
Other Briefs and Motions 36
ORDERS 37
RESOURCES 38
RULES 38
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I. INTRODUCTION
and Duration of the Problem
The U.S. E.P.A. is charged with the duty of managing and
replenishing the limited Superfund to the greatest extent possible.
While our enforcement activities under the Comprehensive Environ-
mental Response, Compensation, and Liability Act (CERCLA) will
generally be directed against solvent parties, there have been
and will continue to be times when a responsible party declares
bankruptcy.
This memorandum sets forth enforcement options for dealing
with bankrupt parties. It includes guidance on when to proceed
against bankrupt parties. It also discusses the theories and
procedures for recovering cleanup costs from bankrupt parties
under both federal bankruptcy law and common law theories of
recovery. Finally, it is intended to serve as a bankruptcy infor-
mation clearinghouse, listing materials available from OECM-Waste
on bankruptcy and related subjects.
In the long run, the requirements of the Resource Conservation
and Recovery Act (RCRA), particularly the closure and financial
requirements, should insure the orderly closure of storage or
disposal facilities. Nonetheless, this will not always occur.
Thus, while the purpose of this memorandum is to aid the EPA official
enforcing CERCLA, much of it will be relevant to future efforts by
EPA to require bankrupt owner-operators of storage or disposal
facilities, generators, and transporters to contribute as much as
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possible to the cleanup of the hazardous conditions they have
created.
B. When to Proceed against a Bankrupt Party
In making the determination of when to proceed against
bankrupt parties the Regions should balance the likelihood of
recovering assets from the estate of the insolvent party against
the extent of Agency resources required to prosecute bankrupt
parties. The Regions should also evaluate the effect that pursuing
parties who have filed bankruptcy will have in deterring future
frivolous or fraudulent bankruptcy claims.
1. Probability of Recovering the Cost Litigation
Two questions shoul.d be answered by the Regions to determine
the efficient use of enforcement resources and the extent to which
the Agency should pursue bankrupt parties in CERCLA actions.
The first question to answer in determining whether to
proceed against a bankrupt party is related to the scope of the
rase: Are there other solvent parties in the case? If so, CERCLA's
purposes may be served by proceeding against them alone. In general,
actions against bankrupt parties such as generators lacking assets
should not be undertaken when there are other solvent parties.
The second question that must be answered by the Regions
relates to the value of the case: Are there assets in the estate
of the bankrupt party? The Assistant United States Attorney in
the District where the Bankrupty Court sits may be able to send
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copies of the case docket to an EPA attorney.J/ Depending on the
stage of proceedings, the docket nay include an itemization of
assets. It nay be pointless to proceed if there are few assets.
The position of the other creditors should also be considered.
In general, EPA and the Departnent of Justice should naxinize
its use of attorney resources by pursuing bankrupt responsible
parties when there appear to be assets in the estate, and there
are either few secured creditors with relatively linited clains or
some basis exists for recovering funds fron the estate despite the
presence of secured creditors.£/
2. Deterrence of Frivolous or Fraudulent Bankruptcy Filings
On occasion, EPA nay elect to pursue a bankrupt responsible
party even when* it appears unlikely that we will recover sizeable
amounts fron the Bankruptcy Court. The Regions should pursue bankruptcy
actions where the case nay serve as a deterrent to other parties
who would otherwise consider escaping liability through a declaration
1_/ The nost connon form of bankruptcy is liquidation under
Chapter 7 of the Bankruptcy Reform Act of 1978 (11 U.S.C.
$101 et seq.) (hereinafter cited as "the Bankruptcy Code")..
However, several CERCLA cases have involved responsible parties
in Chapter 11 reorganization (see United States, et al. v. Johns
Manville Sales Corporation, et al.. Civil No. 81-299-D). TKe
distinctions between a Chapter 7 liquidation and a Chapter 11
reorganization are discussed infra. Unless otherwise stated the
discussion in this memorandum concerns Chapter 7 liquidation
proceedings.
2_/ This evaluation should be documented in the case referral
package prepared by the Region. The Departnent of Justice
has requested that all bankruptcy referrals include a "quick look"
financial assessnent of the potential defendant's assets (i.e. a
summary of assets listed in the bankruptcy papers, a Dunn and
Bradstreet report, etc.)
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of insolvency. For instance, through the prosecution of bankrupt
parties the Agency could provide an effective deterrent to under-
financed "fly-by-night" companies who see bankruptcy as a way to
avoid their liabilties to the federal government. Similarly, it
is important that responsible parties are treated equitably. For
example, in a case involving a bankrupt site owner/operator
whose actions contributed significantly to the waste condition,
EPA could pursue the bankrupt site owner to further the enforcement
policy goal of treating responsible parties even-handedly and
equitably.
II. THE BANKRUPTCY CODE: An Overview
A. Organization of the Code
The Bankruptcy Reform Act of 1978 (11 U.S.C. 5 101 e_t seq.
(1978)) replaced and liberalized the Act of 1898 (11 U.S.C. S 1 et
seq. (1898)). The new act, commonly called the Bankruptcy Code,
consists of eight chapters. Those relevant to EPA claims are:
Chapters 1, General Provisions; 3, Case Administration; 5, Creditors.
and Debtor, and the Estate; 7, Liquidation; and 11, Reorganization.
Chapters 1, 3, and 5 set forth definitions and procedures
common to all bankruptcies. The provisions of Chapters 7 and 11
set forth the specific procedures for liquidations and reorganiza-
tions. Under a Chapter 7 "straight bankruptcy" or "liquidation,"
a debtor is granted a discharge of all debts but must liquidate
all assets. A Chapter 7 bankruptcy is administered by a trustee
appointed by the Bankruptcy Court. Under Chapter 11, there is no
liquidation of assets. Rather the goal of this chapter is to
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reorganize the obligations of the debtor in order to give the
debtor a "fresh start" in carrying out his business. The debtor
and his creditors must arrive at a reorganization plan whereby a
share of the debts is paid to the different classes of creditors
on a schedule. The debtor normally administers the reorganization.
B. Voluntary vs. Involuntary Bankruptcy
Under either Chapter 7 or 11, the debtor himself may
initiate a voluntary action.37 The debtor does not have to be
insolvent^/ and no formal adjudication of bankruptcy is required
in voluntary cases. An order for relief is automatically entered
by the Bankruptcy Court in a voluntary case.
An involuntary petition under Chapter 7 or 11 may be filed
against most debtors by certain creditors. The debtor may contest
the petition, however, and the issue of whether the debtor is or is
not insolvent will then be adjudicated. The Bankruptcy Court will
only enter an order for relief if the debtor is not generally paying
v*-,. ^^v«-^ -« f-x«»y become due, or if a custodian, within the last 120
days before the filing of the petition, has taken possession of or
has been appointed by the Court to take charge of substantially all
of the debtor's property.£/
3/ . 11 U.S.C. f 109(b).
A/ Insolvency in bankruptcy law is a term of art derived from
common law. If a corporation or individual claims insolvency
under the common law of a State (as opposed to filing under the
federal Bankruptcy Code), he is generally only deemed insolvent if
he is not paying his debt.s as they become due .and if a receiver or
other custodian has been appointed by the Court to take charge of
his property.
J>/ 11 U.S.C. 5303(h)
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III. CERCLA AND BANKRUPTCY ACTIONS
Section 101 of the Bankruptcy Code defines "creditor" as:
(A) (an] entity that has a claim against
the debtor that arose at the time of or before
the order for relief [dismissal decision of
Bankruptcy Court which follows the approval of
the trustee's Final Report] concerning the
debtor ...
Under section 101 of the 1978 Act, a "claim" is a:
(A) right to payment whether or not such
right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal,
equitable, secured, or
(B) right to an equitable remedy for breach
of performance if such breach gives rise to
a right to payment, whether or not such
right ... is reduced to judgment, fixed,
contingent, matured, unmatured, disputed,
secured, or unsecured.
The statute clearly states that a claim need not be premised
on a civil action or a final judgment; it is sufficient if the
claim is based on a simple right to payment as a result of work
completed and cost incurred. Thus, the United States need not
have received a judgment under CERCLA before making a claim against
a bankrupt party. It is enough that the United States has a right
to payment or an injunctive claim. The United States' right to
payment can be based upon CERCLA Sections 107 and/or 104, or other
authorities. Thus, the United States can proceed to file a claim
in Bankruptcy Court.
A. Proceedings in District Court or Bankruptcy Court.
An important question that must be resolved in each case is
whether to initiate proceedings in District Court or Bankruptcy
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Coiirt. An ordinary creditor must proceed in Bankruptcy Court
because under the automatic stay provision (Section 362 of the
Bankruptcy Code, 11 U.S.C. S362(a)), the filing of a Chapter 7 or
Chapter 11 petition operates as an automatic stay of any proceedings
against the debtor. The stay halts the following:
(1) the commencement or continuation ... of a
judicial, administrative, or other proceeding
against the debtor that was or could have been
commenced before the commencement of the case
under this title;
(2) the enforcement, against the debtor or against
property of the estate, of a judgment obtained
before the commencement of the case ...
(3) any act to obtain possession of property of
the estate or of property from the estate;
(4) any act to create, or enforce any lien
against property of the estate;
(5) any act to create, perfect, or enforce against
property of the debtor any lien to the extent
that such lien secures a claim that arose
before the commencement of the case ...;
(6) any act to collect., assess, or recover a claim
against the debtor that arose before the
commencement of the case ...; and,
(7) the setoff of any debt owing to the debtor ...
In a number of situations, however, the filing of a petition
does not operate as a stay, including (Section 363(b)):
(4) ... the commencement or continuation of
an action ... by a governmental unit to
enforce such governmental unit's policy or
regulatory power;
(5) ... the enforcement of a judgment other than
a money judgment, obtained in an action or
proceeding by a governmental unit to enforce
such governmental unit's police or regulatory
power.
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The purpose of these exceptions, as articulated in the House
Report accompanying the Bankruptcy Code, is to permit governmental
authorities to pursue actions to protect public health and safety^/
and to allow governmental units to sue or continue suit against a
debtor to abate violations of environmental protection laws.^/
The exception in Section 36i(b)(4), as interpreted by the
government, is broad. It matters not what is sought: The government
may commence or continue any police or regulatory action. This
includes actions for money (CERCLA S107) and actions for injunctive
relief (CERCLA §106).£/ At the stage of seeking to execute any
6/ H.R. Rep. No. 95-595 95th Cong., 2d sess. 343 (1978); 95
Cong. Rec. H 11092 (Sept. 28, 1978)
TJ H.R. Rep. No. 95-595. at 343. See also; In re Bay Bridge
Inn., Inc. v. New York State Liquor Authority. 94 F.2d 555
(2d Cir. 1938); In re Colonial Tavern v. Charles L. Byrne. 420 F.
Supp. 44 (D. Mass. 1976) and In re Dolly Madison. 504 F.2d. 499
(3d. Cir. 1974) [held; a bankruptcy court should not interfere with
governmental regulatory programs]; Aaron, Bankruptcy Stays for
Environmental Regulation: Harvest of Commerical Timber as an
Introduction to a Clash of Policies. 12 Envt'l. Law .1. 5-8 (1981)
IL.nkrupt.cy Law - When is a Governmental Unit's Action to Enforce
its Policy or Regulatory Power Exempt from the Automatic Stay
Provisions of Section 362?. 9 Fla. Univ. L. Rev. 369. 380 (1981).
See: 11 U.S.C. S362(c)-(g) for the conditions under which the
automatic stay remains in effect and other rules applicable to
obtaining relief from the stay.
8/ A motion to overcome the stay should generally be filed in
Bankruptcy Court before proceeding in District Court. (See
Pleadings section, infra.) A recent opinion in which.a Bankruptcy
Judge discussed — and rejected -- holding a citizens' group in
contempt for failing to overcome the stay is In Re Revere Copper
and Brass, Inc. . 29 B.R. 584 (Bkrtcy.N.W. , 19'SJY. When the govern-
ment proceeds in District Court, a timely proof of claim should
also be filed in Bankruptcy Court (see page 24 infra) When a
Regional attorney wishes to pursue in District Court a cost recovery
judgment againt a bankrupt party, it is particularly important that
this strategy be discussed with appropriate EPA H/Q and DOJ attorneys
before referral of a case.
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judgment that may be obtained, the government should be prepared
to argue that enforcement of the judgment is a continuation of the
governmental unit's enforcement of its regulatory power. Thus the
Bankruptcy Code read in conjunction with CERCLA and other authorities
allows the United States to seek an order from Federal District
Court requiring the Bankruptcy Court to order the debtor in posses-
sion or trustee to use assets of the bankrupt to abate a hazardous
condition or to reimburse the government for its expenditures.
In two recent cases, the courts rejected the government's
view of -the exceptions. In United States v. Johns Manville £/,
the District Court in New Hampshire denied EPA's motion to vacate
an Order issued by the Bankruptcy Court in New York staying all
proceedings in an EPA enforcement action against Manville. The
opinion characterized the government's action for injunctive relief
as tantamount to an action for a money judgment. Since Section
362(b)(5) of the Code prohibits enforcement of a money judgment,
the Court held that the injunctive relief sought by the government
did not fall within the parameters of the bankruptcy stay exemption.
The Court noted that if the government had instead sought an
injunction to prevent active, on-going disposal rather than cleanup
of an existing hazard, such an action would not have been stayed
by the bankruptcy filing. In our view, the District Court
9/ No. 81-229-D (D.N.H. decided Nov. 15, 1982)
196
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.^P/ The Agency has proceeded with CERCLA response activities
at the Johns Manville sites.
In In Re Kovacs, 11 / Ohio was stayed from proceeding in
State Court in its efforts to enforce an injunction requiring
Kovacs to clean up a hazardous waste site. Kovacs, a corporate
officer and operator of the Chem-Dyne site, had declared bankruptcy.
The Sixth Circuit, affirming the District Court and Bankruptcy
Court decisions, held that Ohio, in proceeding to enforce the
injunction in State Court was actually seeking a money judgment.
The Supreme Court granted the State of Ohio's petition for a
writ of certiorari on January 2-4, 1983. The Supreme Court vacated
the judgment and remanded the case to the Sixth Circuit to consider
the issue of mootness. The Supreme Court has accepted certiorari
for a second time in the Kovacs II case.J_2_/ The issue presented
in Kovacs II is whether a bankrupt defendants may rely on the
discharge provisions of the Bankruptcy code to void an injunction
which requires him to cleanup a hazardous waste facility. In
January 1984, the United States filed an amicus curiae brief in
1Q/ The government took the position that the Johns Manville
District Court erred, in a motion to dismiss in AM Inter-
national v. United States. Case .No. 82-B04922 (N.D. 111. Bkrtcy
Ct.) (CERCLA S 106 Action) .
H/ 681 F.2d 454 (6th Cir. 1982).
127 State of Ohio v. Kovacs (Kovacs II), 717 F.2d 984 (6th Cir.,
1983) (cert, granted, Sp. Ct. No. 83-1020).
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the Kovacs II case stating that the case has national implication
for environmental enforcement under the Clean Water, RCRA, and
CERCLA and further the states that the 6th Circuit decision
"obviously encourages polluters to abuse the Bankruptcy Code
and defy state and federal environmental protection." 13/
B. Cost Recovery under Section 107 of CERCLA
The United States should be prepared at the time of filing
of a proof of claim in Bankruptcy Court to prove that its claim
should be allowed by the court. That is, if the agency has spent
(or will spend) 14/ money at a site under the provisions of CERCLA
104, and wishes to recoup such expenditures under CERCLA Section
107, the United States will have to demonstrate to the Bankruptcy
Court that the estate is in fact liable for such expenses under
Section 107 .]*/
Therefore, when the United States files a proof of claim
with the Bankruptcy Court, Department of Justice and EPA attorneys
13/ Id.. Memorandum for the United States as amicus curiae
supporting petitioner (January, 1984).
14/ In the case where the Agency has not spent Superfund money
at the site but where we intend to conduct a fund-financed
response action, the United States can file a proof of claim for
an open account." The proof of claim would indicate that the
claim is founded on an open account which will become due upon
the completion of the abatement actions by EPA.
157 A usual commercial claim of a creditor is established by the
existence of a receipt or invoice indicating that the debtor
received goods or services which he contracted to receive. When
EPA has performed work on a site, however, -there has been no agree-
ment to perform such work between EPA and the bankrupt party.
Therefore, we must be prepared to prove Section 107 liability in
order to prove our claim.
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should be prepared to prove all elements of a Section 107 cost
recovery action. The case must be referred to the Department
of Justice in the normal way, although there may be situations
when a referral by telephone may be necessary. See Procedures,
infra.
1. Distribution of Assets
(a) Secured Creditors
The claims of secured creditors are satisfied
fully before assets are distributed to any unsecured creditors,
including creditors claiming administrative expenses. The
justification for this treatment of secured creditors is statutory
(11 U.S.C. SS507, 726). A valid lien is a right to repayment,
created by agreement, which exists independently of bankruptcy
laws. As such, it is a charge against assets which must be met
before distribution to unsecured creditors.^/ For example, a
bank that has made a loan to the owner of a facility that is
secured by a lien on the heavy equipment will receive "off the
top" the amount representing the value of the heavy equipment or
the equipment itself before distribution of assets to unsecured
creditors in order of their priority under Section 507 of the
Code.
3 Collier on Bankruptcy. Para 507.02 507-12.6 (15th Ed.
195T7:
199
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In Chapter 7 proceedings, secured creditors will recover
before unsecured creditors, including EPA, unless the Bankruptcy
Court is persuaded by our arguments to jump our claims ahead of
all others.]2J In Chapter 11 proceedings, the government should
be prepared to play an active role in working out the terms of a
reorganization plan with the various classes of creditors which
provides for eventual repayment of our cleanup expenditures.
The classes of creditors that have secured interests will have
the greatest leverage in negotiation of a plan.
(b) Priority Structure
Section 507 of the Code sets up the priority
structure for satisfaction of unsecured claims.Jj*/ Payments to
the unsecured creditors are generally made on a pro rata basis.
Ten, fifteen or twenty cents to the dollar is common, depending
on the assets remaining in the estate. The following expenses
and claims have priority in the following order under Section
507(a):
1. First, administrative expenses ... and any fees
and charges assessed against the estate ...
177 §507(b) establishes a "Super Priority" which would require
tEe Agency to have priority over every other claim allowable.
Under $507(b) EPA would have to. prove (1) that EPA has a claim
(for administrative expenses) and (2) that this claim is protected
by a lien on the debtor's property (mechanics lien or prejudgment
lien) and (3) that the stay has prevented use of the property
(clean up). See Motion for Allowance of Administrative Expenses,
In Re TriangleThemicals Inc.. Case No. 80-00993-HS-7.
18/ 11 U.S.C. 507(a)
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2. Second, unsecured claims allowed under
Section 502(f) of this title, [regarding
certain claims arising in involuntary cases]
3. Third, allowed unsecured claims for wages,
salaries, or commissions, including vacation,
severance and sick leave pay.
4. Fourth, allowed unsecured claims for contributions
to employee benefit plans.
5. Fifth, allowed unsecured claims of individuals,
to the extent of $900...
6. Sixth, allowed [certain] unsecured [tax or
penalty fee] claims of governmental units ...
Claims by the United States are classified as sixth priority
claims or general unsecured creditors. Because government claims
are so low in the priority line, attorneys for the government should
be prepared to argue that our claims should be given greater
preference, based on one of. the theories described below.
Congress is currently considering a bill 19/ intended to
give claimants under RCRA or Superfund a priority in bankruptcy
proceedings superior to all other creditors, whether their claims
are secured or unsecured. Four states have already enacted
197 H.R. 2767 sponsored by Rep; Florio.
201
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similar provisions in their own environmental laws.20/
2. Theories of Recovery Beneficial to the United States
(a) Administrative Costs
The proof of claims filed so far by the United States have
asserted that cleanup expenditures should be considered adminis-
trative expenses of preserving the estate of the bankrupt, thus
deserving to be satisfied as top priority claims. While there
is little caselaw on point, one case provides support for this
theory. In Ottenheimer v. Whitaker 217 t the Court upheld the
decision of the Bankruptcy Court which required the trustee to
expend sums of money as administrative costs in order to remove a
hazardous nuisance. The condition was created when the bankrupt
party abandoned several barges in Baltimore Harbor. The Court
20/ Massachusetts oil and Hazardous Materials Release Prevention
and Response Act, Mass. Gen. Laws. Ch. 21E; New Hampshire
Solid and Hazardous Waste Management Act, N.H. Rev. Stat. Ann.
Ch. 147-B: 10; New Jersey Spill Compensation and Control Act, 58
N.J. Stat. Ann. $10-23.11f (1981). Colorado has also enacted
superlien legislation. For a dismissal of these statutes and the
pending federal legislation see "Superlien 'Solutions' to Hazardous
Waste: Bankruptcy Conflicts" ABA Environmental Law Newsletter,
winter 83/84.
21./ Ottenheimer v. Whitaker. 198 F. 2d 289 (3rd Cir. 1952) was
decided under the Bankruptcy Act of 1898, 30 Stat. 544, which
has been replaced by the current Bankruptcy Reform Act of 1978,
92 Stat. 2549 (codified at 11 U.S.C.). See also. In re Lewis
Jones. Inc. 1 Bankr. Ct. Dec. 277 (Bk. Ct. E.D. Pa. 1974) for
the proposition that the bankruptcy court is under a duty to
protect the public interest and may order a Trustee to take
action to protect such interest. Various memoranda supporting
filed proofs of claim contain further caselaw and arguments.
These are available from OECM-Waste.
202
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reasoned that obstruction of the Harbor would conflict with the
purposes of the Rivers and Harbor Act.
In its opinion the court stated, "The judge-made rule
[allowing abandonment] must give way when it comes into conflict
with a statute enacted in order to ensure the safety ot navigation;
for we are not dealing with a burden imposed upon the bankrupt or
his property by contract, but a duty and a burden imposed upon an
owner of vessels by an Act of Congress in the public interest."227
The United States has argued, by analogy, that expenditures
made by EPA in the public interest under the authority of CERCLA
should be reimbursed as administrative expenses. This public
interest argument should stress the importance 'of recovering
money to replenish the fund to clean up additional sites. There-
fore, in a CERCLA case, as in Ottenheimer, an Act of Congress
enacted for the public health and welfare should take priority
over the usual bankruptcy distribution order.
In a recent ruling from the bench in a case entitled In re
T.P. Long, in the U.S. Bankruptcy Court for the Northern District
of Ohio, held that the trustee is liable to EPA for cleanup
costs at a hazardous waste site.£37 While the Judge did not
specifically state that the Government's cleanup expenses were
"administrative expenses" for bankruptcy purposes, the written
order is expected to elaborate on the ruling from the bench.
221 Id. at 290.
23/ In Re T.P. Long Chemical Co.. Inc., Case No. 581-906 (N.D,
Ohio, Bkrtcy. Eastern District, April 5, 1984).
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The United States is expeced to file briefs on the question of
priority for reimbursement as between the secured interest holder
(b) Recovery Under Section 506 (c) of- the Code
This subsection states: "The trustee may recover
from property securing an allowed secured claim the reasonable,
necessary costs and expenses of preserving, or disposing of, such
property to the extent of any benefit to the holder of such claim."
(11 U.S.C. S 506(c». In a situation involving real property
securing a loan made by a bank or savings and loan, cleanup costs
that preserved the property would presumably benefit the lender
and would be recoverable. This would allow the Agency to object
to any liquidation of the -real property.
The language of Section 506(c) states, however, that the
trustee rather than the government can recover. The government
cuuld -deal with this by specifically requesting the trustee's
ratification of EPA cleanup plans or obtaining from the trustee an
agreement to seek reimbursement under 506(b).24/
24/ See Robinson v. Dickey. 36 F. 2d 147 (lienholders did not
object to water being pumped out of mines for safety reasons
and were liable for expenditures). First Western Savings & Loan
Association v. Anderson. 252 F. 2d 544; Miners Savings Bank of
Pittston. Pa. v. Joyce. 97 F.2d 973.
204
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(c) Equitable Liens
It has also been suggested by the Civil Division of
the Department of Justice that, depending on the facts of the
situation, the United States could argue that expenditures of
funds for cleanup create an equitable lien on the property. Such
a lien would create an implied contract for reimbursement of EPA
as a secured creditor. State law on equitable liens should be
researched if this theory is attempted. It may be of limited
use since State law may only allow for imposition of an equitable
lien in situations involving a fraudulent conveyance of real
property. State law may also require the trustee to have re-
quested cleanup of the property, or at least agreed to it.257
(d) Restitution
Equitable restitution of the United States has been
approved by the court in cases in which the United States acted to
alleviate a potential health hazard. In Wyandotte Transportation
Co. v. United States 26/t the Coast Guard unloaded a barge loaded
with liquid chlorine gas that the defendant had refused to unload
promptly. The Supreme Court required reimbursement of costs
incurred by the United States. The Court noted that denial of
reimbursement would have financially penalized the United States
25/ For a discussion of State Law on "Mechanics Lien Statutes as
— an Enforcement Tool in CERCLA Cost Recovery Actions." See memo
from R. Schaefer to A.J. Barnes and C.M. Price dated January 11, 1984
26/ Wyandotte Transportation Co. v. United States, 389 U.S. 191
— (1967).
205
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for acting expeditiously to protect public health and safety,
while unjustly enriching the defendant.
The Wyandotte case has been invoked in proof of claims filed
by the United States as a basis for recovery of CERCLA costs that
the government has incurred. In a recent order issued in United
States v. Northeastern Pharmaceutical and Chemical Co.. Inc.. et al.
(NEPACCO) 27/t the court stated that restitution was available under
S7003 of RCRA because the bankruptcy action was an action in equity.
United States v. Reserve Mining 28/ also lends support to a claim
based on restitution. In that case, the Court held that when the
United States is seeking reimbursement for alleviating a potential
public health hazard caused by one who is in violation of a federal
statute, reimbursement may be granted under the Court's equitable
powers.
C. Other Matters In Bankruptcy and Insolvency Cases
1. Abandonment of Property
AH any bankruptcy case, the trustee may choose to petition
the Court to allow abandonment of some or all of the assets of the
estate on the grounds that care of the assets by the trustee would
be excessively burdensome to the estate. 297 xhe rationale for
27/ United States v. Northeastern Pharmaceutical and Chemical Co.,
Tnc"., et al. (NEPACCO) (September 30. 1983, W. Dist. Missouri
S.W. Div.).
28/ United States v. Reserve Mining. 408 F. Supp. 1212, (D. Minn.
1976).
29/ 11 U.S.C. S 554.
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pennitting abandonment was articulated in In re Ira Haupt & Co.;
...[T]he courts have always recognized that
a Trustee is under no duty to retain the Title
to a piece of property or a cause of action
that is so heavily encumbered, or so costly,
in preserving or securing, that it does not
promise any benefit to the funds available
for distribution.3£/
The United States will oppose abandonment in certain circum-
stances because the procedure may allow the estate to avoid
liability for on-going environmental obligations and may allow the
trustee to rid the estate of an asset in which the United States
may ultimately have an interest, (based on equitable lien, resti-
tution or administrative expenses). For example, if contaminated
property is abandoned by the trustee, the property reverts back to
the secured creditor and the Agency may have no claim against the
nonbankrupt party after clean up. Accordingly, the United States
should normally take the position that abandonment is only permis-
sible when public health and safety obligations (statutory or
•~fcV:ervise) are met, and when a third party will not recover a
windfall from EPA's clean up actions. Abandonment may be preferred
prior to clean up if the property will revert to a viable party
whom EPA may pursue for contribution to the clean up.
The position of the United States is supported by the reasoning
of the Ottenheimer v. Whitaker case, 31/ and by In Re Lewis Jones.
30/ In re Ira Haupt & Co., 398 F.2d 607 (2d Cir. 1968).
31/ Supra, note 13.
207
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Inc. 32/ in the Ottenheimer case, the Court refused to allow the
trustee to abandon assets that created a hazardous condition.
Rather, the Court required the trustee to use assets of the estate
to remove from Baltimore Harbor several barges belonging to the
debtor that might have otherwise obstructed the Harbor.
In In Re Lewis Jones. Inc., the Court reiterated the Otten-
heimer position and held that the bankruptcy trustee could not
simply abandon the property. Instead, the trustee was required to
repair various steam pipes and manhole covers to protect public
health and safety. The Court in Ottenheimer had held that abandon-
ment of the debtor's barges by the trustee would conflict with the
Rivers and Harbors Act. The Court in In Re Lewis Jones went a
step further, stating that "even absent the violation -of a srate
or federal act, the public interest must be protected by the Bank-
ruptcy Court." 337
The law on abandonment under the Code is unsettled. In the
recent bankruptcy case, In Re Quanta Resources,347 the New Jersey
District Court affirmed the Bankruptcy Court's ruling allowing
abandonment of a hazardous waste site over the objection of the
City of New York and the State of New York. The Court allowed the
company to abandon a hazardous waste site on grounds that the
327 Id.
337 In Re Lewis Jones, supra at 280.
347 In Re Quanta Resources Corp.. __^___ F. Supp. _
No. 82-3524 (D.N.J. Jan 24, 1983) Appeal* Pending
No. 83-5142 (3d Cir.).
208
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property was burdensome to the estate. At the site, there were
500,000 gallons of waste oil, sludge and hazardous waste stored in
52 tanks and about 70,000 gallons of waste oil contaminated by
PCBs.3J>/ While Quanta had previously signed a consent order
with the N.Y. Department of Environmental Conservation to clean up
the site, the Bankruptcy Court's favorable ruling on abandonment
effectively nullified the order.
New York City and State had asserted that the holdings in
Ottenheimer and Lewis Jones required that the Court deny the
trustee's petition to abandon and allocate assets in the estate to
be used for site cleanup rather than distribution to creditors.
The Court rejected this argument, pointing out that the two cases
were decided before passage of the 1978 Bankruptcy Act. Before the
Act, the Court noted, abandonment was allowable under judge-made
rule. Section 554 of the Bankruptcy Code, however, provided specific
statutory authority for the abandonment of burdensome property.
This authority, the Court stated, was not conditioned by Congress
upon a finding that abandonment does not harm the public interest.367
The Court was similarly unpersuaded by New York's argument
that S959(b) of the United States Judicial Code, (28 U.S.C. Section
35/ Hazardous Waste Litigation .Reporter, (July 6, 1982) at 2,646
367 Id. at 3,671 and 3,672.
209
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959(b)) prohibited abandonment. Section 959(b) provides Ghat the
trustee shall "manage and operate" property in his possession
cn.wwiJiu6 ;o valid laws. The Court found that this provision did
not apply to the trustee in a Chapter 7 context, but only to
receivers and trustees involved in business operations rather than
in distribution of an estate.
2. State Insolvency Lavs
States can enact insolvency laws that affect bankrupt
parties as long as the substance of those laws does not overlap
with the Federal Bankruptcy Reform Act's jurisdiction. The United
States Constitution gives Congress the power to establish uniform
laws on bankruptcy 377 but does not prevent states from passing
valid laws on insolvency. To the extent there is no conflict
between a state's insolvency law and the federal bankruptcy law,
the state law remains in operation.387
The United States may benefit from being a creditor in state
insolvency proceedings in appropriate situations. Under 31 U.S.C.
S191 (1979), debts to the United States are given top priority in
state insolvency proceedings. The top priority for government
debts does not create a lien on the debtor's property in favor of
the federal government. At a minimum, however, it gives the
government a right of priority over all unsecured creditors to
377 U.S. CONST art I, S8 cl 4.
387 In re Wisconsin Builders Supply Co.. 239 F.2d 649 (7th Cir.
1956), Cert, denied 353 U.S. 985 (1958).
210
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payment out of the property in the hands of the debtor's assignees
or other representatives under the conditions specified in the
statute.39/
IV. PROCEDURES
A. Rules of Bankruptcy Procedure
The Supreme Court, advised by the Judicial Conference of the
United States, has the authority to promulgate rules governing
cases under the new Bankruptcy Code.f^y The Advisory Committee on
Bankruptcy Rules was duly appointed by Chief Justice Burger to
draft rules. The Committee was nearing completion of work on the
Proposed Rules when the decision in Northern Pipeline Construction
COi v. Marathon Pipeline Co. cast doubt on the Code and the Proposed
Rules. Thus, no new rules have yet been promulgated.
The existing rules were summed up in a Bankruptcy Monograph
drafted by the Office of the Attorney General:
"Until ... rules of practice and procedure are
approved, at least two different sets of rules
must be consulted. First, there are the "Suggested
Interim Bankruptcy Rules" prepared by the Advisory
Committee on Bankruptcy Rules of the Judicial
Conference of the United States which were published
397 Bramwell v. United States Fidelity & Co., 269 U.S. 483
(1926). The United States could also argue that satisfaction
of CERCLA-based claims precedes consensual liens, such as mortgages.
The question appears to be open. Collier, at any rate, expresses
the view that whether consensual liens come ahead of the Government s
S191 priority has not been finally and authoritatively determined.
Vol. 6A Collier, S913[2] p. 246.
407 Under Public Law 95-598 §248, Congress conferred this power
on the Supreme Court, amending the grant of rule-making power
set forth in 28 U.S.C. 52075 to include the new Title 11 Bankruptcy
Code.
211
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in August 1979 as 'guidelines' that could be adopted
as local rules. The interim rules have been adopted .
in many districts, albeit with occasional variations....
Local district court rules apply in some Jurisdictions.
Some bankruptcy courts have adopted numerous local
rules in addition to, or in lieu of, these interim
rules. Second, if a point of procedure is not covered
by the applicable local rules, consult the Bankruptcy
Rules in effect under the Bankruptcy Act of 1889."W
Government attorneys involved in bankruptcy cases will find
rules and all forms (such as proof of claim forms) in Collier on
Bankruptcy (15th ed. 1981).
B. Filing Proofs of Claim
To have standing as a creditor, the United States must file a
proof of claim form which states the name of the claimant; the amount
of the debt or claim; the ground of liability; the date the claim
became due or will become due under an open account theory, see
footnote 10 supra; and, the nature of the claim (secured or general,
unsecured ).^_2/
The .filing of proofs of claims or interests is explained in
Section 501 of the Bankruptcy Code.f^/ In a liquidation case under
Chapter 7, a claim ordinarily must be filed within six months after
the first date set for the first meeting of creditors.^/ Claims based
417 Bankruptcy Monograph dated November 22, 1982, prepared by the
Office of the Assistant Attorney General, Civil Division, for
use of U.S. Attorneys, at pp. 6, 7.
427 See. Bankruptcy Rules, Proof of Claim official forms. Proof
of claims filed so far have"included brief affidavits from
the On-Scene Coordinator stating amounts spent and describing the
nature of the work done as well as copies of bills submitted to
EPA by contractors.
43/ 11 U.S.C. 1, 501.
447 3 Collier on Bankruptcy Para. 501.02[2]'(15th ed. 1979).
212
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on administrative expenses can be filed any time before the Court
has granted the debtor a discharge of debts. It is more difficult
to determine when to file a proof of claim in a Chapter 11 reorgan-
ization because while the filing is required prior to the Court's
acceptance of the reorganization plan, there is no mechanism for
determining when that acceptance will take place. A proof of
claim should be filed immediately, with telephone concurrence by
EPA HQ (OECM and OWPE) and DOJ, if there is any reason to believe
that a reorganization may be about to be concluded.
Section 502 of the Code governs the allowance of claims or
interests; a claim is deemed allowed "unless a party in interest
... objects."457 in most cases, the proof of claim should be
included in the litigation referral package sent to OECM which
will then be sent to the Department of Justice and signed by the
Assistant Attorney General for Land and Natural Resources or his
delegate. The Department of Justice must be involved in the
filing of. a proof of claim in Bankruptcy Court,46/ As stated
above, special procedures may be available in emergency situations
in which the government would otherwise miss filing deadlines.
Headquarters and DOJ should be contacted.
457 11 U.S.C. S 506(a).See also (b)-(j) [Procedure after objection]
467 See, fn 1 , page 3 supra for referral documentation that the
Department of Justice has requested regarding their financial
status of responsible parties.
213
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-27-
C. Pleadings
See the attached Index of Resources for a listing of proofs of
claim and other pleadings that EPA has filed so far.
One problem area involves the issue of whether or not the
United States should file a motion to overcome the stay in Bankruptcy
Court before proceeding to seek injunctive relief in District Court.
Arguably, the statute is clear on its face and no special motion
is necessary for continued exercise of our regulatory powers.
Nonetheless, Bankruptcy Courts have held attorneys in contempt
for failing to overcome the stay. It is recommended, therefore,
that a motion to overcome the stay be filed with Bankruptcy Court
when the government seeks injunctive relief from a bankrupt party
in District Court.
D. Appeals
Bankruptcy appeals are heard by appellate panels of three
bankruptcy judges appointed to the circuit counsel, on. election of
the circuit.4_Z/ If this procedure is not available, appeals are
to the District Courts.487 EPA and the Land and Natural Resources
Division of DOJ will involve the Appellate Staff of the Land and
Natural Resources Division in appeals from decisions of a Bankruptcy
Court and in filing of amicus briefs on bankruptcy issues related
to hazardous waste site cleanup.
477 28 U.S.C. S 160
487 28 U.S.C. S 1334
214
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E- Federal Bankruptcy Court Jurisdiction
The jurisdiction of Bankruptcy Courts has been in a confused
state since the Supreme Court's decision in Northern Pipeline
Construction Co. v. Marathon Pipe Line Co. W The Court held
unconstitutional the grant of power in the Bankruptcy Reform Act
(28 U.S.C. 1471(b)(c)) that gave Bankruptcy Courts jurisdiction
over all "civil proceedings arising under title 11 [of the U.S.
Code, Bankruptcy] or arising in or related to cases under title
H."5iO/ This broad jurisdictional grant to the Bankruptcy Courts
was deemed unconstitutional because bankruptcy judges do not have
the protection conferred by Article III of the U.S. Constitution
(i.e. lifetime tenure subject to removal only by impeachment and
irreducible compensation). It is unclear what effect the decision
in Northern Pipeline will have on the type of cases that can be
brought in Bankruptcy Court until Congress legislates a solution.
At the least, however, it is clear that the traditional state
common-law actions (commonly called "Marathon claims" by bankruptcy
practitioners) may no longer be litigated in Bankruptcy Court absent
the consent of the litigants.51/
49/ U.S. , 102 S. Ct. 2858 (1982).
507 28 U.S.C. 1471(b)(c).
517 Cook, New Bankruptcy Quandary Could Be Easily Solved,
Legal Times, Sept. 6, 1982 at 10 Col. 1.
215
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-29-
Ih reaction to Congress.' failure to enact legislation that
would rectify the constitutional infirmity of the Code, the Adminis-
trative office of the United States Courts, Washington, D.C., form-
ulated model rules to be used as interim measures by the United
States Circuit Courts,52/ The cover explanation circulated with
the rules summarized the main points as follows:
Under the model rule, all bankruptcy matters are
initially referred to a bankruptcy judge. [Section b(l)
of the Rule]. In proceedings not involving a final
judgment on a Marathon claim, the bankruptcy judge may
enter orders and judgments that become effective immed-
iately, subject to district court review if requested by
a party. [Section (c)(2).] With respect to final judg-
ments in Marathon claims, the bankruptcy judge prepares
recommended findings and conclusions and a proposed judg-
ment. [Section (c)(3.)] A district judge then reviews
the recommendation and enters a judgment. [Section (c)(5)],
Where circumstances require, an order or judgment
entered by a bankruptcy judge will be confirmed by a dis-
trict judge even if no objection is filed.537
Because the United States claims are based on federal rather
than state law, the provisions are not directly relevant to our
claims. Nonetheless, .the Rules do appear to allow the government
_-•— ..« ~"periment with options for seeking relief in the Bank-
ruptcy Court. For example, the United States can move the District
Court to "withdraw the reference to the bankruptcy judge. "£4/ If
52/ See; Memorandum from William E. Foley (Dir. Admin Officer
of U.S. Courts) to Judges, Clerks U.S. Court System Regarding
Continued Operation of the Bankruptcy Court System after Dec. 24,
1982 in the Absence of Congressional Action.
537 Id.
54 / §1471 (d) grants Bankruptcy Judges the authority to refuse
jurisdiction.
216
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-30-
such a motion were granted, the District Court could retain the
entire matter, refer part of it back to the bankruptcy judge or
refer the entire matter back to the bankruptcy judge. The govern-
ment should also make a simultaneous motion to overcome the stay.
If, however, an action in Bankruptcy Court has already been initiated,
the government may file a motion to stay the bankruptcy matter in
order to proceed in District Court.557
V. THEORIES OF INDIVIDUAL LIABILITY
The government anticipates situations in. which individuals
responsible for the creation of hazardous waste site conditions are
financially solvent even though the corporate owners and operators
are bankrupt. In such a case, the United States may choose to
ignore the estate in bankruptcy and pursue the responsible individ-
uals -- as individuals -- directly, or the United States could
pursue both the assets of the bankrupt corporation and the appro-
priate individuals.56/
55/ These procedural recommendations were made informally in
conversations with staff members of the U.S. Administrative
Courts. Perhaps reflecting the current confusion in the bankruptcy
court system, one staff attorney stated that CERCLA actions appeared
to present unusual subject matter that a District Court would wish
to hear itself in light of Northern Pipeline; the other staff
attorney discouraged EPA from attempting to be heard by District
Court, stating that business was proceeding as usual in bankruptcy
courts.
56/ For a general discussion of individual liability, see Guidance
Memo "Liability of Corporate Shareholders and Successor Corpo-
rations for Abandoned Sites Under the Comprehensive Environmental
Response Compensation, and Liability Act" (CERCLA)" from Courtney M.
Price to Regional Counsels due to be issued June 1984.
217
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-31-
A. Personal Involvement in Acts and Omissions
The scope of personal liability of corporate officers is broad.
A corporate officer, director, or agent is liable for torts he
commits regardless of. whether he acted on his own behalf or to
benefit the corporation, regardless of whether he personally bene-
fited from the commission of the tort and regardless of whether
the corporation is also liable. He is also liable for the torts
of the corporation and of other directors, officers or agents if
he failed to exercise reasonable care.57/
The liability of corporate officers is generally limited to
situations in which the corporate defendant has knowledge or
responsibility for tortious acts being committed within his area
of responsibility. A general duty of supervision may be an insuf-
ficient basis for liability.587
The United States plans to make use of this theory of liability
in pursuing, in certain cases, the assets of individuals involved
with coroorations that have declared bankruptcy. The fact patterns
of these particular cases seem well-suited to the law. They involve
situations in which hazardous waste treatment or disposal operations
57/ See: 19 C.J.S. Corporations SS845, 850 (1940). Accord;
U.S. v. Hess. 41 F. Supp. 197. (S.D. N.Y. 1983). See also:
Miller v. Muscarelle. 1970 A. 2d (N.J. Super.. 1961); Donsco Inc.
v. Casper Corp., 587 F. 2d. 609 (3d Cir. 1978); Patyman v. Howey,
340 Ho. 11, 100 S.W. 2d. 851, 856 (1963). Singleton v. Armor
Velvet Corp.. 4 P. 2d 223 (cal. App). See also Brief in U.S. v.
Mahler (M.D. Pa.) drafted by Michael Steinberg, Attorney, Environ-
mental Defense Section, DOJ. (April 1, 1983) for a discussion of
personal liability.
58_/ Martin v. Wood. 400 F. 2d 310 (3d. Cir. 1968).
218
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-32-
were directed by employees of corporations that later declared
corporate bankruptcy and abandoned the facilities, leaving public
nuisance conditions essentially of their own creation.
In fact, EPA and the Department of Justice have already used
this legal theory successfully. In one RCRA Section 7003 case, the
United States argued that this Section imposes personal liability
on corporate officers. The Court denied defendant's motion to
dismiss, stating:
"In Missouri, a corporate officer who participates
in the commission of a tort may be held personally
liable for any resulting damage. Patyman v. Howey,
100 S.W. 2d 851, 856 (Mo. 1936). 'A contrary rule
would enable a director or officer of a corporation
to perpetrate flagrant injuries and escape liability
behind the shield of his representative character,
even though the corporation might be insolvent or
irresponsible.' 19 Am. Jur. 2d S 1382 at 77.597
In addition to theories of individual tort liability, CERCLA
explicitly allows individuals to be held liable for cleaning up
hazardous waste sites. Section 107 of CERCLA clearly permits impo-
sition of strict liability upon broad classes of persons including
an individual owner or operator, any person who at the time of
disposal of any hazardous substance owned or operated any facility,
persons who arranged for disposal and persons who accepted for
transport hazardous substances.60/ The Act defines "person"
as, inter alia, "an individual."^/ One purpose of the corporate
59/ U.S. v. North Eastern Pharmaceutical & Chemical Co.. Inc.
etTal.. (NEPACCO) No. 80-5066-CV-SW (Western Dist. Mo. 1981).
A later NEPACCO decision based a determination of liability on §107
of CERCLA. (see discussion infra)
60/ CERCLA 5107(a)(1)(2), (3)(4)
61_/ CERCLA 5 101(21).
219
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-33-
structure is to insulate shareholders from liability. There is,
however, no insulation from liability — no corporate veil to
pierce — when officers or agents of a corporation commit tortious
acts or participate personally in the commission of torts.
B. Piercing the Corporate Veil
By piercing the corporate veil, the United States may be
able to establish the individual liability of shareholders for
torts committed by the corporation. The case law tends to uphold
protection of the. corporate form. Courts will, however, make
exceptions to this rule when shareholders have commingled individual
and corporate affairs so that the corporation appears to be no
more than the "alter ego" of the individual shareholder.
Federal courts have relied on the following factual tests in
determining when to pierce the corporate veil: 1) Is the corporation
undercapitalized for its purposes? 2) Does the corporation observe
corporate formalities? 3) Does the corporation pay dividends?
4) Is the corporation solvent? 5) Have the dominant shareholders
siphoned corporate funds? 6) Does the situation present an element
of "fundamental unfairness"?^/ Courts have refused to pierce the
veil absent a showing of fundamental unfairness.^/ However,
62/ United States v. Pisani. 646 F.2d. 83, 88 (3d. Cir. 1981).
637 DeWitt Trucking Brokers v. W. Ray Fleming Fruit Company.
540 F. 2d 681, 687 (4th Cir. 1976).
220
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-34-
fraud need not be shown if federal law governs a caseJ&f^/ The
general rule applied by federal courts to cases involving federal
statutes is that the individuals may be held liable in the interest
of public convenience, fairness and equity. The specific statutory
directives of CERCLA support a federal law. In addition, the
language of CERCLA establishes liability for individuals who owned,
operated or otherwise controlled activities at hazardous waste
sites.657
Fact situations faced by the United States involving hazardous
waste disposal or treatment operations should prove appropriate
for piercing the veil. In many cases, the United States is finding
that CERCLA problems have been created by corporations that have
been mismanaged and undercapitalized for the purpose of handling
hazardous waste. Moreover, in some cases, the same individual
shareholder/directors have dissolved and reformed essentially the
same hazardous waste operations several times, an indication that
the corporate form is being used as a shield and "alter ego" for
individuals.
64/ United States v. Normandy House Nursing Home. 428 F.Supp.421,
424 (D. Mass. 1977). The government will want to argue that
federal law applies to piercing the veil. U.S. v. Kimbell Foods,
440 U.S. 715 (1979), holds that application of State law should
not frustrate the objectives of federal statutes. In the Pisani
case, supra, at 87, the Third Circuit stated, "We believe it is
undesirable to let the rights of the United States change whenever
State courts issue new decisions on piercing the corporate veil."
657 See, pages 7-9, Guidance Memo "Liability of Corporate Officers"
fn 49 supra.
221
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C. Personal Jurisdiction in Cases Involving Corporate
Officers or Shareholders'
If the United States proceeds to initiate action against
individual corporate officers or shareholders, the government should
anticipate that defendants may raise the defense of improper juris-
diction or service of process if they reside outside the state
where the CERCLA site is. For example, in U.S. v. North Eastern
Pharmaceutical & Chemical Co.. Inc.. et al. (NEPACCO)5£/, defendants
alleged that, as Connecticut residents, they were not subject to
extraterritorial service of process under Missouri rules of civil
procedure. They argued that since their acts in directing the
disposal of hazardous waste in Missouri occurred not as their
individual acts but as the corporate acts of NEPACCO, they could
not be subject to extraterritorial service of process as defined in
the Missouri rules.
The Court rejected this argument as overly technical and
affirmed that it had valid personal jurisdiction over the defendants
-»^w..-w, ituwever, points to the need for attorneys to research
state law regarding personal jurisdiction and service of process.
Referrals to the Department of Justice should include anticipated
defenses related to personal jurisdiction.
66/ Order No. 5066-CV-SW, (June 11, 1981, W. Dist. Missouri,
SW Div.)
222
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VI. INDEX OF RESOURCES
These materials can be sent to EPA Regional attorneys on
request. Because OECM-Waste does not have the resource capability
to reproduce and send numerous copies, mailings will be limited to
one copy per region of each document listed.
PLEADINGS
Proofs of Claim
In the Matter of Aidex Corp.. Case No. 79-0-1 It, APPLICATION
FOR PAYMENT OF FUNDS HELD IN TRUST BY THE CLERK OF THE COURT
FOR CLEAN UP OF HAZARDOUS WASTE SITE CONDITION.
U.S. v. Jack L. Neal and Geraldine Faye Neal (Globe), Case No.
83-00198, COMPLAINT FOR DECLARATORY JUDGMENT AND APPLICATION
FOR ORDER FOR REIMBURSEMENT OF COSTS INCURRED BY THE U.S.
IN RESPONSE TO A HAZARDOUS SITE CONDITION.
In re Liquid Disposal Inc., Case No 82-01846, APPLICATION FOR
ORDER FOR REIMBURSEMENT OF COSTS INCURRED BY THE UNITED STATES
TO CLEAN UP A HAZARDOUS SITE CONDITION and accompanying
affidavit and invoices. (Eastern Disc., MI)
In re Triangle Chemicals, Inc., Case No. 80-00993-HS-7,
plus APPLICATION FOR ORDER FOR REIMBURSEMENT etc. and affidavit,
(Southern Dist., TX)
In re Crystal Chemical Company, Case No. 81-02901-HB-4, plus
UNITED STATES MEMORANDUM IN SUPPORT OF PROOF OF CLAIM.
(Southern Dist., TX)
Other Briefs and Motions
In the Matter of Aidex Corp., Case No. 79-0-111, MOTION TO
VACATE AUTOMATIC STAY, and accompanying MEMORANDUM IN SUPPORT
OF MOTION TO VACATE AUTOMATIC STAY and accompanying court
order granting motion. (West Dist., NE)
In re Crystal Chemical Company, Debtor, Case No. 81-02901-HB-4,
OBJECTION TO PROPOSED GRANT OF REPLACEMENT LIEN AND TO PROPOSED
DISCHARGE OF LIEN and accompanying court order granting motion.
(Southern Dist., TX)
223
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State of Ohio. Petitioner v. William Lee Kovacs. ON PETITION
FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT, Brief for the United States as Amicus
Curiae. (Brief supporting appeal of Ohio to the Supreme Court).
In re Triangle Chemicals. Inc.. Case No. 80-00993 HS-7 MOTION
FOR ALLOWANCE OF ADMINISTRATIVE EXPENSES AND PROPOSED ORDER
REQUIRING TRUSTEE TO PAY EPA's EXPENSES. Filed Aug. 22, 1983.
In the Matter of Quanta Resources Corp.. Debtor. State
of New York and City of New York. Appellants, v. Thomas
J. Q'Neillf as Trustee. Appellee. (QUANTA hereafter) Appeal
from the District Court for the District of New Jersey,
Brief of Appellants. (U.S. Court of Appeals for the Third
Circuit, No. 83-5142).
QUANTA, Brief of the Commonwealth of Pennsylvania and
State of New Jersey, Amici Curiae. (U.S. Court of Appeals
for the Third Circuit, No. 83-5142).
In Re A.M. International. Inc.. Case No. 82-B-04922, Defendant's
(United States') Reply Memorandum in Support of Defendant's
Motion to Dismiss.
State of Ohio v. Kovacs (Kovacs II), 717 F.2d 984 (6th Cir.,
1983)
ORDERS
United States of America, et al. v. Johns Manville Sales
Corporation, .et al.. Civil No. 81-299-D. Order of the
District Court denying United States and New Hampshire
U40UJ.WU to vacate the automatic stay. (Nov. 15. 1982;
U.S. District Ct., N.H)
State of Ohio v. William Lee Kovacs. No. 81-3320. Decision
affirmed District Court and Bankruptcy Court decisions that
Kovacs was entitled to protection of automatic stay. (June 16,
1982, U.S. Court of Appeals, Sixth Circuit)
United States of America v. North Eastern Pharmaceutical
and Chemical Co.. Inc.. 'et al.. No. 80-506b-CV-SW.Decision
denying defendants' motion to dismiss for lack of personal
jurisdiction. (June 11, 1981; Western District of Missouri,
S. Western Division)
Universal Metal Stamping. Inc. v. Pennco Machinery. Inc.,
Bankruptcy No. 81-01262K. Bankruptcy Court held that automatic
stay does not stay a separate suit against the bankrupt's
"sister" corporation. (December 7, 1981; Eastern District,
Pennsylvania)
224
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RESOURCES
Bankruptcy Monograph conveyed to U.S. Attorneys Offices
November 22, 1982.Summary of bankruptcy law and procedure.
EPA Guidance Manual; Pursuing RCRA Subpart H Interests
ICF. (February, 1983)
Brief in U.S. v. Mahler (M.D. Pa.) drafted by Michael Steinberg,
Attorney, Environmental Defense Section, DOJ (April 1, 1983).
Discusses personal liability of corporate officers.
RULES
Memorandum from William E. Foley, Director of the Administrative
Office of the United States Courts on CONTINUED OPERATION OF
THE BANKRUPTCY COURT SYSTEM AFTER DECEMBER 24, 1982, IN THE
ABSENCE OF CONGRESSIONAL ACTION (the "Emergency Rules" or.
"Interim Rules"), (December 3, 1982).
225
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
^/ WASHINGTON. D.C. 20460
SEP 10 1984
OFFICE OF
ENFORCEMENT AND
COMPLIANCE MONITORING
MEMORANDUM
SUBJECT: Policy on Enforcing Information Requests in Hazardous
Waste Cases
FROM: Courtney M. Price
Assistant Administrator for Enforcement
and Compliance Monitoring
TO: Regional Administrators, I-X
Regional Counsels, I-X
Lee M. Thomas, Assistant Administrator for
Solid Waste and Emergency Response
The attached policy has been developed to assist the
Regions in enforcing information request letters issued pursuant
to Section 104 of the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA) and Section 3007 of
the Resource Conservation and 'Recovery Act (RCRA). The policy
is intended to encourage agressive enforcement against parties
that do not comply with such letters.
The policy delineates statutory authority to obtain
information, briefly discusses other sources of information and
sets forth options available to the 'Agency to enforce requests
for information in civil cases dealing with hazardous waste and
hazardous substances.
If you or your staff have any further questions regarding
enforcement of CERCLA and RCRA information requests, please
contact Fred Stiehl (FTS) 382-3050 or Jerry Schwartz at (FTS)
382-3104.
Attachment
226
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POLICY ON ENFORCING INFORMATION REQUESTS
IN HAZARDOUS 'WASTE CASES
INTRODUCTION
Section 104 of the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA) and section 3007 of the
Resource Conservation and Recovery Act (RCRA) provide EPA with
considerable authority to obtain information from parties involved
with hazardous substances or hazardous wastes (collectively
"hazardous materials").J/ Information request letters issued
pursuant to these sections have proven quite useful, particularly
because of the high rate of compliance associated with these
letters. Occasionally, however, letter recipients refuse to
respond to requests, or provide an inadequate response. This
policy document delineates statutory authority to obtain informa-
tion and sets forth options available to the Agency to enforce
requests for information in civil cases dealing with hazardous
materials.^/
This policy has been developed along with .the guidance
document on issuing notice/information request letters ("Notice
Letter Guidance"), which will be issued shortly.
\J These sections also provide authority to enter facilities to
perform inspections, conduct studies, and obtain samples.
Access authority is discussed in a policy document which will be
issued separately.
"LI With regard to obtaining information in the context of
parallel civil and criminal cases, consult Courtney M. Price's
memorandum "Policy and Procedures on Parallel Proceedings at the
Environmental Protection Agency," dated January 24, 1984.
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STATUTORY AUTHORITY
Section 104(e)(l) of CERCLA provides:
For purposes of assisting in determining the
need for response to a release under this
title or enforcing the provisions of this
title, any person who stores, treats, or
disposes of, or, where necessary to ascertain
facts not available at the facility where
such hazardous substances are located, who
generates, transports, or otherwise handles
or has handled, hazardous substances shall
upon request ... furnish information
relating to such substances...."
(Emphasis supplied)
Section 3007(a) of RCRA provides: 3/
For purposes of ... enforcing the provisions
of this title any person who generates, stores
treats, transports, disposes of, or has handled
hazardous wastes shall, upon request ... furnish
information relating to such wastes.;.."
(Emphasis supplied)
In most information request letters, both sections should
be cited as authority for the request. Note that it is appropriate
to cite RCRA S3007(a) as authority for requests relating to those
wastes the regulation of which has been partially suspended by
Congress pursuant to RCRA S3001(b)(3)(A) (e.g., "mining waste").
This suspension does not limit the wastes which may be considered
"hazardous wastes" for purposes of several sections of the statute,
including section 3007. 45 Fed. Reg. 33090, (May 19, 1980) and
40 CFR 261.l(b). Additionally, if the "mining waste" or other
waste suspended under RCRA falls- within the definition of
3_/ The Agency has also issued RCRA §3013 Orders which contain,
inter alia, requests for information.
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hazardous substance under categories A,B,D,E, or F of CERCLA
§101(14), the waste is a hazardous substance for CERCLA purposes
and is properly subject to a request under CERCLA §104. See
U.S. v. Metate Asbestos Corp., et al.. F. Supp. , (Az,, 1984)
(Globe case) holding that asbestos tailings, which are mining
wastes, are hazardous substances pursuant to CERCLA §101(14).
INADEQUATE OR NON-RESPONSE
A diligent, good faith effort by the information request
letter recipient to directly respond to the Agency's questions
and to provide information is adequate. The determination of
whether a diligent, good faith effort has been made is necessarily
a case by case decision. Most information requests require the
recipient to indicate the types of files searched in response to
the request. This information should help the Case Development
Team (CDT) determine whether the recipient's file searching
efforts were diligent and whether the recipient actually has
submitted all available information.
In some cases, letter recipients may not have retained
records pertaining to the time period in which the Agency is
interested. This may frequently be the case in multi-party
cases containing many "small" generators who dealt with a site
that was in operation many years ago. In these cases, unless
the Agency has evidence to the contrary, the CDT generally will
accept the recipient's assertion that its records do not go back
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that far. The CDT can help ensure the veracity of a recipient's
claim that it does not have pertinent records by insisting on a
signed affidavit to that effect from a duly authorized company
official.
Of course", the easiest determinations regarding adequacy of
response are those where the company simply refuses to comply.
This includes cases where a recipient responds by stating it
will not answer the questions, or simply does not respond by the
deadline included in the letter. 4/
In one case, a letter recipient asserted that certain
information requested by the Agency was properly withheld because
it was "covered by the attorney-client privilege and the work
product rule." In that case, the Agency issued a RCRA §3008
administrative order (AO) to enforce compliance with the informa-
tion request. The Administrative Law Judge (ALJ) rejected the
company's claim and ordered it to comply with the AO. The ALJ
looked to the language and purpose of the statute and the relevance
of the information requested in rejecting the privilege claims
of the company. £/ While there have been several cases supporting
the Agency's information gathering authority under other statutes,
4/ Information request letters are sent return receipt requested,
The CDT should ensure the party actually received the letter
before taking further action.
5/ See "Order Denying Motion and Requiring Compliance" in the
Matter of Hughes Aircraft Company case. (Attachment A)
Subsequent to this Order, the company submitted the requested
information.
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this is the only case addressing a privilege claim as a defense
to an information request under RCRA or GERCLA.
ENFORCEMENT RESPONSE
A. First Step; Reminder Letter
Once the CDT has made a decision that a recipient has not
responded or has responded inadequately to a request, a "reminder"
letter should be issued. If a letter recipient, however, clearly
indicates its refusal to respond to a request, a reminder letter
would be inappropriate. The letter should recite pertinent past
details (such as when the first letter was sent and a general
description of the information sought), and indicate that the
response is inadequate or that no response was received. It
should also point out that the Agency is considering further
enforcement action if it does not receive the requested information
by a date within the next several weeks. See Attachment B tor a
sample reminder letter.
Compliance with information request letters can also be
increased by informing the responsible party coordinating committee
(in multi-party cases) that the government will not settle nor
exchange information with any party that has not complied with a
request. This has proven effective in several multi-party cases.
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Any telephone or other contacts with the recipient regarding
the request should be well documented, including telephone calls
requesting clarification to questions or agreements to extend
the deadline for response. This information will be critical
should the Agency decide to take further enforcement action.
B. Second Step; Evaluate Candidates for Further Action
As a general rule, the GOT should first consider
for further enforcement action those recipients that clearly
have not complied with the information request. These are
recipients whom the CDT is sure received the information request
and, if applicable, reminder letters, but have not responded at
all or have responded by refusing to comply with the request.
The CDT should next consider for further enforcement action
those recipients that responded with .a less than diligent effort
at searching their files, or whose response was otherwise inadequate,
Finally, the CDT should consider those recipients that responded
late to the request.
C. Third Step; Evaluate Enforcement Options
The Agency's authority for enforcing an information request
is contained in S3008(a) of RCRA, and §S104(e) and 113 of CERCLA.
Section 3008 provides in pertinent part: •
"... whenever on the basis of any information the
Administrator determines that any person is in
violation of any requirement of this subtitle, the
Administrator may issue an order requiring compliance
immediately or within a specified time period or the
Administrator may commence a civil action..."
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Section 3008 .civil actions and AOs can seek both injunctive
relief and penalties.
Section 113 of CERCLA grants federal district courts
jurisdiction to hear an EPA motion for injunctive relief to
compel compliance with an information request. Unlike §3008 of
RCRA, however, §104(e)(l) of CERCLA does not provide for penalties
Section 113(b) provides in pertinent part:
"...the United States district courts shall have
exclusive original jurisdiction over all
controversies arising under this Act...."
Thus, the options available to the Agency to pursue an
inadequate response are: (1) issue a RCRA §3008 AO seeking
injunctive relief and penalties, (2) file a civil action pursuant
to RCRA §-3008 and CERCLA §113 seeking injunctive relief-and
penalties, where appropriate and (3) issue a RCRA §3008 AO seeking
penalties only. In determining which option to choose, the CDT
should examine the same considerations as in other potential
enforcement cases, such as the likelihood that the particular
recipient will comply with an AO and the immediacy of the need
for the information. In those cases where the information is
needed immediately or likelihood of compliance is small, a civil
action may be preferable. Each option is discussed in more
detail below.
1. RCRA §3008 AOs Seeking Injunctive Relief and Penalties:
AOs issued to compel compliance with an information request
are similar to other RCRA §3008 AOs. They should contain findings
of fact and determinations, should assess penalties in accordance
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with the Agency's RCRA Penalty Policy £/ and should order the
respondent to comply with the original information request.
Care should be taken to ensure that the findings of fact demon-
strate the relevance of the information requested, that the
information is necessary to respond to a releas-e or to enforce
the appropriate provisions of the Acts, and that the recipient
deals with hazardous waste. Note that under RCRA §3008(a) each
day of noncompliance with an AO is a separate violation for
purposes of assessing penalties.
2. Filing RCRA S3008 and CERCLA S113 Civil Actions; TJ
A referral to the Department of Justice (DOJ) for inadequate
or non-response to an information request should include all
relevant letters, documentation of telephone contacts, information
sufficient to demonstrate that the recipient deals with hazardous
materials, and that the information request is for one or both
of the specified purposes of the statutes. Again, these referrals
are similar to other referrals and all pertinent guidance should
be followed. As indicated in previous guidance, a referral
pursuant to S3008 can seek enforcement of an AO, penalties or
remedies for the underlying §3008 violation.
£/ See the Final RCRA Civil Penalty Policy, May 8, 1984,
page 31, number (4) for an example of a penalty calculation
for noncompliance with a RCRA S3007 information request.
7/ The United States has filed a complaint for noncompliance
with a RCRA S3007/ CERCLA §104 information request in
U.S. v. George Liviola, Jr., et al.. No. C84-1879Y, Northern
District of Ohio.Copies are available from OECM-Waste.
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3. Issuing AOs Assessing Penalties Only:
RCRA §3008 AOs issued, to letter recipients who eventually
submit the requested information, but submit it late or after
the Agency had issued reminder letters only assess a penalty,
since injunctive relief (for submission of the information) is
no longer necessary. Regional enforcement personnel are encouraged
to use penalty-only AOs for late submissions if adequate resources
are available. These AOs will demonstrate to the regulated
community that the Agency is serious about utilizing its informa-'
tion gathering authority and taking further action to enforce
the use of that authority, where appropriate.
CONCLUSION
The information gathering authority available to the Agency
will continue to be effective only if the Agency takes a strong
stand in enforcing these requests. Whenever possible, the CDTs
should take whatever action is necessary to ensure compliance
with these letters.
Attachments
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- 4
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
IN THE MATTER OF: ) Docket No. IX-81-RCRA-123
Hughes Aircraft Company, ) Marvin E. Jones
Administrative Law Judge
Respondent.
Environmental Protection Agency
324 East llth Street
Kansas City. Missouri 64106
ORDER DENYING MOTION AND REQUIRING COMPLIANCE
By Motion dated November 3, 1981, Respondent Hughes Aircraft Company
moves to dismiss the Complaint filed herein on September 30, 1981. Said
notion is based on its contentions set forth in its "Memorandum in Support
Hughes' Motion --", filed therewith, which recounts that on July 17, 1981,
Complainant (U.S. Environmental Protection Agency, Region 9) issued a letter
requesting that Respondent provide certain information relating to tests
conducted by it on soil, water supply and well-water samples taken on grounds
of Air Force Plant- No. 44 or in the vicinity of Tucson International Airport,
along with information relating to samples taken in March and May 1981,
pursuant to Section 3007(a) of the Solid Waste Disposal Act as amended by the
Resource Conservation and Recovery Act of 1976 (hereinafter "RCRA"), 42 U.S.C.
Section 6927(a), including "Solid Waste Disposal Act Amendments-of 1980"
P.L. 96-482, October 21, 1980). Said Section 3007 of P.CRA, 42 U.S.C. Section
6927, provides in pertinent part as follows:
"For purposes of ... enforcing the provisions of this title,
any person who generates, stores, treats, transports, disposes
of, or otnerwise handles or has handled hazardous wastes shall,
upon request of any officer, employee or representative or cne
Environmental Protection Agency, duly designated by the
Administrator ... furnish information relating to such wastes
and permit such person at an reasonaoie times to nave access
to, and to copy all records relating to. such wastes."
(emphasis added)
Said 3007 letter states, in pertinent part, as follows:
"On or about March 5, 1981 and again on or about May 28,
1981 representatives of Ecology and Environment, Inc. took
well samples in the vicinity, of the airport for EPA. Some
of these wells were located on your property and the samples
taken from these wells were split for a duplicate analysis
by your own or a contracted laboratory.
EPA'hereby requests the results of the above mentioned
samples obtained by your- laooratory. EPA also requests the
results of any sarpling (soil, water supply and well water)
for TCE, DCS, or Cr+6 that you conducteG on your property or
in the vicinity of the Tucson International Airport."
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2
Hughes responded on August 11, 1981, and on August 31, 1981, to the first and
second parts, respectively, of said 3007 Letter, as follows:
August 11. 1981
"1. Hughes did not obtain a split sample from the samples
taken by representatives of Ecology and Envirorenent, Inc.,
on March 5, 1981. This fact is documented on page thre°
of the Sampling Documentation attached to the FIR.
2. The split samples obtained from the representatives of
Ecology and Environment, Inc., on May 28, 1981, were
obtained and analyzed under the direction and
supervision of Hughes counsel. These tests results
are covered by the attorney-client privilege and the
work product rule, and are not properly subject to
disclosure under your Section 3007 request. Also,
please note that Section 3007 expressly requires the
Environmental Protection Agency to furnish promptly
to the party being investigated the results of any
analysis made of such samples. Section 3007, however,
does not have a similar requirement with respect
to the party under investigation. We interpret this
to mean that Section 3007 does not require the party
under investigation to disclose the results of its
analysis and that the Environmental Protection
Agency is not authorized by Section 3007 to seek
disclosure of such results."
August 31. 1981
"1. Hughes has not conducted tests for DCE on its property
or in the vicinity of the Tucson International Airport.
2. Except for the data obtained from an outside laboratory
(see Attachment A), and for data .covered by the attorney-
client privilege and th'e work product rule, and not
properly subject to disclosure under your Section 30C7
request, Hughes has not conducted tests for TCE on its
property or in the vicinity of the Tucson International
Airport.
3. The attached data relating to Cr+6 (See attachments B-C)
are the only data which Hughes has been able to locate
relating to tests conducted by Hughes on its property
or in the vicinity of the Tucson International Airport."
Hughes was served, on October 7, 1981, with the subject Complaint and
Compliance Order which alleges that Hughes' reply contained in its letters of
August 11 and 31 "did not provide the information requested in the Section 3007
letter" and for said cause concludes that Hughes thereby is "in violation of
Section 3007 of RCRA." The Compliance Order therein issued to require
Respondent to provide Complainant all of the information requested in its
Section 3007 letter. Hughes' motion is- bottomed on its factually unsupported
contention stated in its said letters dated August 11 and 31 and in its
Motion's supporting memorandum, that the test results sought are "covered by
the attorney-client privilege and the work product rule" and thus are not
237
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3
properly subject to disclosure under Complainant's 3007 request. In its
August 31 letter it states that Hughes conducted no tests for dichloroethylsne
(DCE) on subject sites; and apparently contends that any tests made for
trichloroethylene (TCE) and data relating to TCE, on subject sites, are
privileged and not properly subject to disclosure. The August 31 letter
further indicates that data relating to Hexavalent Chromium (Cr+6) as furnished
therewith and as the only data which Hughes has been able to locate (relating
to tests conducted by Hughes) on subject sites.
In the alternative, Respondent characterizes the allegations in subject
complaint as "vague, ambiguous and overly broad" to the extent that Respondent
cannot reasonably frame its answer thereto and requests that Complainant be
directed to set forth a more definite statement of its claim.
In its letter of August 31, 1981, Respondent states: "Hughes considers
all of the information contained in both letters (August 10 and August 31, 1981}
to be confidential and asserts its claim of "confidentiality."
I find that Respondent's claim that the information, sought by Complainant
in its 3007 letter, is privileged anH not properly subject to disclosure is
without merit. Respondent is in violation and continues in violation of the
Act by its refusal to furnish information so requested.
Rules of disclosure were not known at common law. The scope of privilege,
if properly claimed, must be determined primarily by words and intent of
pertinent statutes. (State ex rel Von Hoffman Press v. Seitz. 607 S.W.2d 219
(HO); 27CJS Section 69, p. 203)) Privilege when properly claimed is limited to work
product of the attorney with respect to the pending action and goes no further
(27 COS, Discovery, Note 3.6, p. 227), and whether any information is privileged
in any Instance is a question of fact and the burden is on the party claiming
the privilege.
Administrative agencies are not rigidly restricted by jury trial rules of
evidence (Buckwater v. FTC. 235 (F2d) 344; Opp Cotton Mills v. ADMR.
312 US 126, 155, 61 S.Ct. 524). Davis, Adm. Law Treatise, Section 8.15, p. 534
states that Federal Rules of Civil Procedure Governing Discovery do not apply
to administrative proceedings. More important in the instant case, the
salient question as ruled by the express provisions, cited hereinabove, of
Section 3007 of RCRA:
238
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"(Respondent) shall, upon request — furnish information relating
to such wastes —".
The offense here charged is "regulatory." As stated in Belsinger v. D.C.
(1969), 295FS159; 436 F.2d 214, "In regulatory offenses, the public interest
outweighs the individual interest." For the sake of adequate public.
protection, it is necessary to require a standard of conduct which assures a
result that will protect the public to the extent intended by the Act. The
relevance of the subject information to the instant proceeding is an important
consideration. The information sought consists of data and records necessary
to the proper prosecution of the subject Complaint and regulatory action
germane thereto. In general, exemption of documents from discovery is based
on principles of public policy, and the holdings indicate that such exemptions
are narrowly construed; interpretations of such are generally grounded in the
principle that the interpretation must uphold rather than vitiate the Act.
Here the subject statue must be read in a manner which affectuates rather than
frustrates the major purpose of the legislation (see Shapiro v. U.S., 335 US! (1943)).
Further, I do not find that Complainant's request for subject information to be
either "too broad" or "vague and indefinite." A movant for production should
not be held on "too strict a showing" of content of record he has never seen.
(State ex rel .Boswell v. Curtis, 334 S.W.Zd 757 (MO I960)). The reponses of
Hughes make clear that no information is available, as to tests for DCE and
indicate that tests for TCE are "data covered by privilege." In like manner
Respondent's claim of confidentiality must be summarily rejected (see
40 C.F.R. 2.305(g) where provision is made for disclosure of information
(actually furnished) "because of the relevance of the information in a proceeding
under the Act (RCRA).")
By reason of the foregoing, Respondent's Motion to Dismiss and Alternative
Motion for a More Definite Statement, along with its suggestion of confidentiality
appearing herein, are denied.
ORDER
It is hereby ordered that Respondent shall, within fifteen days frcn the
date hereof:
1. Furnish to U.S. Environmental Protection Agency the results of any and all
tests, made by it or at its instance or procurement, of samples taken by Ecology and
Environment, Inc. from wells in the vicinity of Tucson International Airport (TIA)
on March 5, 1S81, on or about May 28, 1981, and
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2. Furnish to U.S. Environmental Protection Agency the test results of any
sampling (soil, water supply* and well water) for TCE, OCE or Cr+6 conducted
by Respondent on Its propertyor in the vicinity of TIA.
It is further ordered that:
1. Failure of Respondent to comply with the above order, and with the
Compliance Order herein previously made, shall constitute a continuing
violation;
2. Prompt compliance with said orders shall be considered in arriving
at the amount of the penalty, if any, to be properly assessed herein.
**
It Is so ordered.
Dated
fV»rpmh»r ?q. 1QS1
Marvin E. Jori
AdmlnistrativTIaw Judge
CERTIFICATE OF SERVICE
I certify that the original of this Order Denying Motion and Requiring
Compliance was mailed by certified mail, return receipt requested, to the
Regional Hearing Clerk; Region IX, U.S. Environmental Protection Agency,
215 Fremont Street, San Francisco, California 94105 and that true and
correct copies were sent to the following on this £1 *+-' day of
December 1981.
Mr. David L. Mulliken
Latham & Watkins
555 South Flower Street
Los Angeles, California 90071
Mr. John 0. Rothman
Enforcement Division
U.S. Environmental Protection Agency
Region IX
215 Fremont Street
San Francisco, California 94105
Certified Mail P04 5831713
Return Receipt Requested
Certified Mail P04 5831714
Return Receipt Requested
',* ' /
/-• i /^Ln,
?_sl*_ / f.' /i>
Mary Lou ,21 if ton £*'
Secretary to Marvin E. Jones
240
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AT-;.- -
UNITED STATES ENVIRONMENTAL PROTECTION AQENCY
REGION I
J. F. KENNEDY FEDERAL BUILDING. BOSTON. MASSACHUSETTS 02200
Address
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
Re: Silresim Chemical Corporation hazardous waste facility in Lowell, Massachu-
setts
Dear Sir or Madam:
In notice letters issued in August and September of this year, the Environmental
Protection Agency (EPA) and the Commonwealth of Massachusetts notified you of
potential liability that your company may incur or may have incurred in connection
with the Silresim Chemical Corporation hazardous waste facility in Lowell,
Massachusetts. In that same correspondence, EPA requested that you furnish
information and copies of records describing your company's involvement with the
Silresim facility. You were advised that this information was being requested
pursuant to Section iO
-------
November 7, 1983
Page 2
official responsible for the company's response to EPA's information request, and it
should indicate that a diligent search of the company records has been conducted
and that all relevant information discovered in that search, if any, is being
presented to EPA.
Continued noncompliance with these information requests may pose a serious
impediment to the negotiations currently underway on this site. Moreover, it is
EPA's position that failure to comply with these requests within the specified time
period is a violation of federal law which may result in administrative or civil
enforcement action, including penalties under Section 3008 of RCRA of up to
$25,000 per day for each day of continued noncompliance. In most cases EPA will
consider noncompliance to have begun on the revised deadline described in the first
paragraph of this letter.
EPA is currently evaluating which of its enforcement options might be most
appropriately taken in response to noncompliance with its information requests
relative to the Silresim facility and will decide on a course of action shortly after
November 11, 1983. In order to mitigate the extent of any enforcement actions
that may be forthcoming in this matter, your company is hereby encouraged to
comply in full with the information request by dose of business on that date. Your
response should be sent to:
E. Michael Thomas, Esq.
Environmental Protection Agency
Office of Regional Counsel
3FK Federal Building, Room 2203
Boston, MA 02203
If you have any questions on this matter, please call me or Attorney 3ames T.
Owens, ID at (617) 223-0400.
Sincerely,
E. Michael Thomas, Attorney
Office of Regional Counsel
cc: Paul Ware, Esq. Chairman, Silresim Generators Negotiating Subcommittee
Director, EPA Office of Waste Programs Enforcement
Douglas Farnsworth, Esq., EPA Office of Enforcement and Compliance
- Monitoring
Lloyd Guerci, Esq., US. Department of Justice
Lee Breckenridge, Esq., Massachusetts Office of the Attorney General
242
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au/ino
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. D.C. 20460
Association of State and Territorial Sold Waste Management Of
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-2-
and provision is made for EPA/State site agreements through which
EPA and State roles and responsibilities at enforcement sites
can be agreed and documented to prevent later misunderstandings
or misapprehensions.
Taken together, the actions described in the policy provide
a solid foundation for an effective EPA/State relationship in
pursuing enforcement actions at NPL sites. The absence of a
statutory structure for the relationship has presented some
problems in the past, and issues will continue to arise, but a
mechanism has been created to allow EPA and States to deal with
those issues in a way that can minimize conflict and improve the
chances for acceptable solutions.
Lee N. Thomas
Assistant Administrator
for Solid Waste and
Emergency Response
Environmental Protection
Agency
>onald A. LazarchiK
President, Association
of State and Territorial
Solid Waste Management
Officials
244
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
OCT 2!;
OFFICE OF
SOLID WASTE AND EMERGENCY RESPONSE
MEMORANDUM
SUBJECT: EPA/State Relationship in Enforcement Actions for
/^Sites^Qn the National Priorities List
— t -"^ v ^~-N>>- xyXl
C>.i\_/- \_V_r-1^ X V>- &~*\, -J -_-.
FROM: ^"^ Lee M7"Thomas "-3
Assistant Administrator
TO: Regional Administrators
PURPOSE
One of the major goals of EPA enforcement activities under
the Comprehensive Environmental Response, Compensation, and
Liability Act (CERCLA), and of State enforcement activities under
State authorities, is to obtain maximum possible and timely respon-
sible pirty cleanup of sites on the National Priorities List (NPL),
The putpose of this policy statement is to establish a base on
which an effective EPA/State relationship can be constructed.
GENERAL GUIDING PRINCIPLES
The actions to be taken to.establish a more effective rela-
tionship between EPA and the States in NPL site enforcement
activities are guided by certain general principles. In brief,
they are:
0 Aggressive enforcement efforts on a broad scale are
essential if EPA and the States are to make substantial
progress toward dealing effectively with sites on the
National Priorities List.
0 State contributions to NPL site enforcement have been
and will continue to be significant.
0 Close cooperation and coordination between EPA and the
States in planning and carrying out enforcement activi-
ties is necessary to obtain maximum effect and to avoid
possible conflicts and duplication.
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0 States and EPA can maximize the number of enforcement-
actions by operating independently, conducting joint
actions only where such action will best serve EPA and
State interests.
0 EPA and State enforcement policies and procedures need
not be identical, but results of enforcement actions
should be mutually acceptable.
0 To the extent that State and EPA enforcement programs
parallel each other in substantive respects, such as in
the process for determining the appropriate extent of
remedy, the need for oversight of, and direct involvement
in, the other's activities will be minimized.
0 Sharing of information between EPA and the States is key
to developing a more effective relationship.
0 State experience in hazardous waste enforcement must be
recognized and accommodated in formulating agency policies.
0 EPA will provide financial and technical support for
State enforcement actions to the extent practicable and
allowed by law.
0 EPA remains ultimately responsible for cleanup at NPL
sites, and retains the authority to take enforcement or
response actions where needed.
BACKGROUND
From the survey of EPA Regional and headquarters officials
conducted to assess the nature and extent of the current EPA/State
relationship, and as a result of meetings for the same purpose with
State representatives under the auspices of the Association of
State and Territorial Solid Waste Management Officials (ASTSWMO)
and the National Association of Attorneys General (NAAG), it is
clear that EPA and the States generally agree on broad goals in
hazardous waste enforcement activities. It is clear also that
freguently there are differences between EPA and States, and among
States, in capabilities and in legal and technical approaches
toward achieving these goals. These differences — whether based
in provisions of law, policy decisions, or resource constraints —
can lead to situations where a responsible party cleanup or settle-
ment agreement obtained by EPA or a State does not satisfy the
requirements or needs of the other.
Problems created in such situations are particularly acute
when they arise in connection with NPL sites. First, EPA and the
State each may be called on to explain or justify site results,
246
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-3-
regardless of.which had the lead enforcement responsibility.
Second, £PA potentially could be put in the position of denying a
State request to delete from the NPL a State-lead site, or of seek-
ing to delete an agency-lead site in the face of State objections.
Uniformity of EPA and State legal and technical approaches
is not essential to prevent these situations, nor is uniformity
practicable. CERCLA is unusual among Federal environmental laws
in that it does not create a mechanism for authorizing State
enforcement programs on the basis of certain minimum legal and
resource requirements that States must meet. Accordingly, there
is no requirement that State legal provisions and technical pro-
cedures be consistent with Federal standards, nor are there the
usual mechanisms for required State reporting and Federal over-
sight. This means that EPA and the States must establish a
cooperative relationship in order to prevent, or at least minimize,
those instances where differences in capability or approach result
in a responsible party cleanup or settlement which is not mutually
acceptable.
The purpose of this policy, therefore, is to seek to create
an effective EPA/State relationship- by taking certain actions to
increase cooperation and coordination, and by establishing a
mechanism for ongoing EPA/State efforts to address issues that
may later arise.
SPECIFIC .ISSUES IN THE CURRENT EPA/STATE RELATIONSHIP
To establish the context for a discussion of the specific
actions that EPA and the States can take to build an effective
relationship, it is important first to describe briefly the issues
in the current relationship that have been identified through the
survey of EPA personnel and the meetings with State representatives.
These issues are divided among Coordination, State Enforcement
Authorities and Procedures, and Resources.
Coordination. The absence of a comprehensive policy regard-
ing EPA/State relations has left the Regional Offices and States
essentially in the position of determining for themselves the
nature and extent of their relationship. As a result, the level
of coordination and cooperation varies among the Regions, and
even from State-to-State within the same Region.
Further, limited guidance from EPA to the States on specific
issues has contributed to the differences in policies and proce-
dures that often exist among States and between States and EPA.
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Problems created by the lack of a comprehensive EPA/State
policy and by limited issue-specific guidance have been compounded
by the absence of systematic information sharing between EPA and
the States on the status of enforcement actions. Combined with
the lack of procedures for coordinating case management, EPA and
States .therefore have had limited knowledge of the status of the
other's activities. These factors have led to occasional delays
and conflicts in administrative enforcement and litigation, and to
the discovery of problems — if discovered at all — often late in
the enforcement process.
State Enforcement Authorities and Procedures. Most States
must rely either on broad State environmental or general statutes,
or on State hazardous waste legislation enacted prior to CERCLA.
As a consequence, few States have the full range of authorities
available to EPA. While this has not prevented State enforcement
actions against responsible parties, it has meant that in some
instances actions have been limited in scope or coercive potential.
For example, few States have provisions analogous either to
Section 106 of the Act which provides for fines of up to $5,000
per day against any responsible party who willfully violates or
fails or refuses to comply with an administrative order issued
under the section, or to Section 107 of CERCLA which enables EPA
to seek treble damages from any responsible party who fails with-
out sufficient cause to comply with a Section 106 administrative
order.
With regard to enforcement procedures, two particular issues
have arisen. First, some States work informally with responsible
parties, which can lead to arrangements that are difficult to
enforce successfully. Second, State negotiations with responsible
parties often are conducted without a time limit, and in some
instances involve one round led by the administrative agency and
a second round led by the attorney general's office. In either
instance, negotiations easily can become protracted.£/ In these
circumstances, it is often difficult to assess the effectiveness
or the likelihood of success of State enforcement efforts or
negotiations. This uncertainty makes it difficult for EPA to
define, or to plan for implementation of, its role at the site
in a manner that is sensitive both to State concerns and to public
concerns about achieving response objectives at the site. Further,
this type of situation can create EPA/State conflicts if site or
programmatic concerns cause EPA to conclude that effective enforce-
ment action is required on an expedited or more certain schedule.
I/ EPA's experience with negotiations without time limits resulted
Tn the agency developing a policy which targets negotiations for
completion within 60 to 120 days, unless more time is needed to
resolve complex issues with responsible parties who in the agency's
view are negotiating in good faith.
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Resoucces. Funding for State hazardous waste enforcement
programs, whether from appropriations or in some instances from
fees and taxes, ranges from negligible to substantial. The norm,
however, is less than adequate. A survey conducted by ASTSWMO in
mid-1983 showed that anticipated FY 1984 increases in funding among
the responding 47 States still would leave these States, in the
aggregate, with staffing levels some 40 percent short of optimum.
The survey did not categorize technical and administrative person-
nel resources as either program- or enforcement-specific, but this
distinction is not significant, because enforcement activities
depend extensively on technical resources, and the survey indicates
overall conditions.
Limited funding has had a particularly negative effect with
respect to the availability of certain necessary disciplines. The
ASTSWMO survey indicates that the number of State-employed engi-
neers (civil, sanitary, and environmental), chemists, geologists/
hydrologists, and soil scientists is less than half the number
needed. No similar data exist with respect to legal resources
available to State administrative agencies and attorney general
offices, but discussions with State officials indicate that more
resources are necessary, particularly with regard to para-legal
personnel, investigators, and administrative support.
Limitations in State funding also have been felt with regard
to laboratory and analytical capabilities, training opportunities,
and the adequacy of case preparation and documentation.
The net effect of these resource limitations is to constrain
the scope of State enforcement activities, particularly with
respect to the number of actions that can be taken, but also in
part with respect to the detail of field investigation and site
analysis.
ACTIONS TO BE TAKEN
As is clear from the summary discussion of issues confronting
EPA and the States in the current relationship, some issues cannot
be resolved through this statement of policy. For example, funding
assistance for additional personnel resources needed by the States
is beyond the current ability of EPA to provide, and any inade-
quacies that may exist in State legal authorities is a matter for
States to resolve on an individual basis. However, most of the
issues can be resolved by EPA and the States through the actions
described in the remaining sections of this document.
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These actions are based not only on the general guiding
principles stated earlier, but also on a specific operating con-
sideration. EPA is responsible for listing sites on the National
Priorities List and for deleting sites that have been cleaned up
appropriately. This means that EPA has a responsibility to assure
to the extent possible that human and environmental risks at NPL
sites are eliminated or at least reduced to acceptable levels.
Sites cannot be deleted without such assurances.
The actions to be taken, described in the remainder of this
document, Address:
\
0 funding assistance to States,
0 criteria for determining lead responsibility for enforce-
ment sites,
0 enforcement planning activities,
0 . extent of EPA and State involvement in the other's activi-
ties where the other has the enforcement lead,
0 development of EPA/State Enforcement Site Agreements to
clearly delineate the EPA/State relationship at each
enforcement site,
0 mechanisms for sharing enforcement information,
0 State involvement in the development of EPA enforcement
policies and guidance for NPL sites, and
0 ongoing cooperation with States through ASTSWMO and NAAG
to deal with issues that arise in the future.
Fund ing to A_ss is t State Enforcernen t Ac t iv i t i es. It is clear
from the ASTSWMO survey that States require a broad range of
assistance to support needed qualitative and quantitative increases
in State enforcement activity. Consequently, the issue of enforce-
ment funding assistance from EPA was a major focus of an agency
work group that was formed to consider ways in which the scope of
multi-site cooperative agreements might be expanded. ASTSWMO and
NAAG were represented on the work group.
The EPA Office of General Counsel (OGC) concluded that CERCLA
authorizes the agency to fund remedial investigations and feasi-
bility studies at State-lead enforcement sites. Accordingly, the
work group developed guidance to incorporate these activities in
multi-site and individual site cooperative agreements. This guid-
ance will be issued as part of an addendum to the manual State
Participation in the Superfund Remedial Program. Funding of RI/FSs
at selected State-lead enforcement sites will begin in FY 1985.
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However-, .the Office of General Counsel also concluded that
CERCLA does not authorize funding of other State enforcement costs.
In its opinion dated July 20, 1984, OGC stated that "the Superfund
eligibility of State enforcement costs is 'limited to those activi-
ties authorized by section 104(b). Section 104(b) authority does
not extend to litigation or other efforts to compel private party
cleanups, or to monitoring or community relations activities asso-
ciated with such cleanups. Payment of these State enforcement-
related costs will require more explicit statutory authority than
exists in section 104."
Site Classification. Current interim guidance for classify-
ing sites as Fund- or enforcement-lead establishes criteria for
making classification determinations. It does not, however, pro-
vide specifically for State involvement in the process. While
some Regions may consult with States in making classification
decisions, there has been no consistent effort in this regard.
The result is that there have been occasions where sites that have
been classified as Fund-lead might properly have been classified
instead as an enforcement site, based on information and data
available to the State, with the State assuming the lead responsi-
bility. Accordingly, Regions should consult with States in classi-
fying sites to ensure that fuller information is considered before
decisions are made. The final site classification guidance will
incorporate appropriate provisions.
The Regions and States should jointly make determinations as
to whether an enforcement site is to be EPA- or State-lead, or
"shared-lead" where both the Region and the State will pursue site
enforcement. A site should be classified as EPA-lead or State-
lead where direct participation in enforcement actions on the part
of the other is not anticipated or is expected to be minimal. A
site should be classified as shared-lead where the Region and State
determine that joint enforcement action can best achieve effective
site cleanup. Regardless of a site's classification, the Regions
and States should adhere to the provisions described later in this
document regarding consultation and cooperation in the course, of
enforcement activities.
In determining lead responsibility for enforcement sites, the
Regions and States should apply the following considerations:
(1) past site history, i.e., whether there has been EPA or
State enforcement activity at the site;
(2) the effectiveness of enforcement actions to date;
(3) the strength of legal evidence to support EPA or State
action;
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(4) the s-everity of problems at the site;
(5) the national significance of legal or technical issues
presented by the site; and
(6) the availability of EPA and State legal authorities and
personnel and funding resources adequate to enable
effective action.
A site initially classified as State-lead on the basis of the
above considerations will be classified finally as State-lead if
the State assures that it will:
(1) prepare, or have the responsible party prepare, an RI/FS
(or equivalent as agreed by the Region and the State) ,£/
and provide for public comment, in accordance with EPA
guidance;
(2) conduct negotiations with responsible parties formally
(e.g., culminating in the issuance of an enforceable
order, decree, or equivalent) and, to the extent practic-
able, within agreed time limits;
(3) provide for public comment on.settlements, voluntary and
negotiated cleanups, and consent orders and decrees in
accordance wit.h EPA guidance;
(4) pursue and ensure implementation of a remedy that is at
least as protective of public health, welfare and the
environment as a cost-effective remedy as that term is
defined in the National Contingency Plan; and
(5) keep EPA informed of its activities, including consulting
with the Regional Office when issues arise that do not
have clear-cut solutions.
These assurances should be incorporated in the EPA/State.
Enforcement Site Agreement (described later in this document).
J2/ In accordance with agency guidance issued on March 27, 1984,
regarding procedures for deleting sites from the NPL, documenta-
tion to support deleting a State-lead enforcement site "should
include the State feasibility study (if one has been prepared),
... or a copy of an EPA or State study, or an EPA or State review
of a responsible party study or documents/ used by the Region to
determine that ... no further, cleanup is appropriate." To the
extent that a State or responsible party conducts an RI/FS in
accordance with agency guidance, the deletion process for State-
lead enforcement sites will be simplified.
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Where a S.tate is unable to provide the above assurances in
connection with a site that initially has been classified as
State-lead, the site cannot finally be designated as State-lead.
In such instances, consideration should be given to classifying
the site as shared-lead so that State enforcement interests can
be directly represented in site actions.
Finally, all current EPA- and State-lead enforcement site
designations should be reviewed by the Regions and States in
light of these criteria and modified as necessary.
Planning. In accordance with recent agency guidance, site
management plans are to be developed for all sites on the National
Priorities List. As indicated in the guidance, site management
plans are intended principally to be dynamic planning tools for
allocating resources and estimating the timing of technical and
legal actions. For EPA-lead enforcement sites, the Region should
develop the plan in consultation with both the State administrative
agency and the State attorney general's off ice.V Such consultation
is necessary to ensure early that interested State officials are
aware of the general scheme and timing of EPA's intended actions.
For State-lead enforcement sites, the State should develop the
plan in consultation with the Region, and obtain the concurrence
of the State attorney general's office before the plan is adopted.
Site management plans for shared-lead sites should be developed
jointly.
Extent of EPA Involvement in State-lead Enforcement
Actions. There are two aspects to EPA involvement in 'State-lead
actions. The first concerns the type of assistance and support
that the Region agrees to provide. The second concerns actions
that the Region subsequently determines to be necessary in the
course of State enforcement activity.
Among the types of assistance and support that Regions can
provide are review of technical and legal documents, making con-
tractor assistance available, providing direct technical assistance
through Regional personnel, and providing expert witness testimony
through EPA or contractor personnel. Regions should plan to
review technical and legal documents associated with State-lead
enforcement sites; other assistance and support should be provided
to the extent that resources allow. Appropriate provisions should
be incorporated in the EPA/State Enforcement Site Agreement.
JJ/ In some States,the attorneys who prosecute enforcement actions
are assigned directly to the program offices. In this situation,
involvement of the attorney general's office may be unnecessary.
Therefore, statements made at various places in this document
referring to consultation with or concurrence of the attorney
general's office should be read in this context.
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Where a State does not want EPA assistance in its site acti-
vities, particularly with regard to review of technical and legal
documents, the Region should advise the State that it must accept
the risk that cleanup may later prove to be inappropriate. In
such an instance, the site could not be removed from the NPL, and
subsequent EPA enforcement action might be necessary*
\
Regions should continually monitor State-lead enforcement
activities. Where the Region determines that the terms of the EPA/
State Enforcement Site Agreement are not being followed or that the
State is not making effective or timely progress, the Region should
consider involving the agency in site activities to a greater degree
than previously agreed. Potential actions include taking enforcement
action in lieu of State action, and assuming lead responsibility
for the site.
Determinations regarding whether greater EPA involvement is
necessary, and the nature of response, will be made jointly by the
Region and the Office of Waste Programs Enforcement in accordance
with the following considerations:
(1) the State's willingness and ability to correct the
problem;
(2) the availability of EPA resources;
(3) the likely efficacy of EPA action; and
(4) the significance of agency inaction.
Where Federal enforcement action is contemplated, the decision
to pursue such action will be made also in conjunction with the
Office of Enforcement and Compliance Monitoring - Waste.
Extent of State Involvement in EPA-lead Enforcement
Actions. State interest in the conduct and outcome of EPA enforce-
ment actions must be recognized, and State experience and expertise
accommodated in EPA's site activities to the extent possible.
While mechanisms are created in various sections of this policy for
coordinating the planning and execution of enforcement actions, and
for keeping States informed of the status of EPA actions, specific
provision also needs to be made to consider State interests, exper-
ience, and expertise in the course of EPA enforcement activities.
Accordingly, Regions should consult and, wherever practicable,
seek agreement with the States in the design and conclusions of
RI/FSs,. in the identification of the recommended remedy to be
pursued with responsible parties, and in the determination of the
final remedy. There may be occasions where time or litigative
constraints preclude efforts to consult or seek agreement with a
State. In such cases, the Region should proceed with its actions,
254
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but also should inform the State of the circumstances as soon as
possible-. Situations also may arise where a State is unable to
agree with a particular action. In these instances, to the extent
'that time and other considerations permit, the Region should seek
to resolve the issues which prevent State agreement. However,
absence of State agreement initially, or inability subsequently
to- resolve any outstanding issues, is not a bar to necessary and
timely action by the Region or to determination by EPA of appro-
priate action to be taken. EPA recognizes that a State may seek
additional remedy through its own authorities if the State dis-
agrees with an EPA action.
EPA/State Enforcement Site Agreements. Once lead responsi-
bility for an enforcement site has been finally determined, a
site management plan has been prepared, and the extent of antici-
pated EPA and State involvement in the site determined, the Region
and State should develop an EPA/State Enforcement Site Agreement.
The Agreement will delineate the roles and responsibilities of
EPA and the State, lead officials or contacts, mechanisms for
coordination and communication, and any other arrangements or
understandings, including the applicability of State standards .£/
The purpose of the Agreement is to ensure that the extent of
the EPA/State relationship at each site is fully thought out and
documented to prevent later misapprehensions or misunderstandings.
(Detailed guidance for preparing the Agreements will be developed
i'n consultation with ASTSWMO and NAAG and issued separately. In
developing the guidance, consideration will be given to making pro-
vision for multiple sites to be incorporated in a single Agreement.)
Sharing Enforcement Information. As stated previously in
this policy, the absence of a system for sharing enforcement status
information often has left EPA and the States with little knowledge
of the actions of the other.
Development of site management plans can be an effective
starting point. Since a site management plan is to be prepared
through consultation between the Region and the State, and since
it must be updated periodically, a mechanism has been created for
beginning and continuing site-specific discussion and information
sharing. This applies equally to EPA-lead and State-lead enforce-
ment sites.
4/ EPA will endeavor to incorporate State standards in the selected
"remedy where the State standards are consistent with a cost-effective
remedy as defined in the NCP. Accordingly, Regions and States should
explore the applicability of State standards and incorporate the out-
come in the Site Agreement. Where the Region and State are unable
to agree, the State may choose to pursue independent action under
its own authorities.
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In addition to EPA contacts with States to keep site manage-
ment plans current/ the Region and State officials, including
representatives of the State's attorney general, should meet
periodically to review the status of EPA and State actions. The
review should concentrate on NPL sites, including the status of
enforcement and responsible party RI/FS activities, but potential
NPL sites may be addressed as well. Frequency of these meetings
is a matter for Regional and State discretion, but should be no
less often than twice a year. Further, the Regions should contact
appropriate State agencies regularly to advise them of impending
actions and keep them abreast of developments, and States similarly
should inform the Region of impending actions and developments in
State enforcement activities. Arrangements regarding these contacts
and meetings should be incorporated in EPA/State Enforcement Site
Agreements.
Finally, agency guidance in two areas creates additional
mechanisms to keep States informed of EPA's enforcement activities
and to allow State comment. The pending community relations gui-
dance provides for a public comment period both on administrative
orders on consent and on remedial investigations and feasibility
studies, including those prepared by EPA or responsible parties
for Federal enforcement-lead sites. (Both provisions are among
changes to be proposed in the National Contingency Plan.) Further,
guidance implementing agency "rules regarding intergovernmental
review of certain agency actions provides up to 60 days for States
to comment on the agency's intent to initiate RI/FS activities.
While responsible party RI/FS activities are not. included in .the
intergovernmental review process because they do not constitute
Federal actions, they nonetheless will be subject to State review
in accordance with the impending community relations guidance.
In implementing the community relations review procedures,
the Region should assure effective opportunity for State comment
on consent orders and decrees (the latter subject to public comment
by Department of Justice regulations), and agency and responsible
party RI/FSs, by providing copies of'the documents directly to
interested State administrative agencies and to the State attorney
general's office. These activities, however, should not be re-
garded as a substitute for the extensive consultation and coordi-
nation with States described earlier in this policy. State
interests are to be considered, and accommodated to the extent
practicable, prior to public comment periods for agency actions.
Development of Policies and Guidance. The agency is pro-
ceeding to develop enforcement policies and guidance on a broad
range of NPL site issues, and will continue to do so for some
time into the future. The value of increased State involvement
is clear, as is the need for timely distribution of policy and
guidance documents to the States.
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Wherever practicable, EPA will provide opportunity to comment
on draft NPL site enforcement*policies and guidance documents that
are of interest to States. The opportunity will be made available
either to all States through the Regions when time permits or, when
time constraints are particularly acute, to representative States
through the Association of State and Territorial Solid Waste
Management Officials and the National Association of Attorneys
General. Further, for those issues which will require substantial
effort to study and resolve, EPA will seek to increase State parti-
cipation through early consultation and, where appropriate, by
including State representatives on any study or work groups that
may be formed.
Once policy and guidance documents have been made final, the
Regions should, upon receipt, provide copies to State administra-
tive agencies and attorney general offices, and make arrangements
for briefing State officials where appropriate.
EPA has an interest also in State hazardous waste enforcement
policies and guidance, and encourages States to consult with the
Regional Offices in their development and to provide to the Regions
copies of final documents.
FUTURE EFFORTS
EPA intends to continue to work directly with States, and
through the Association of State and Territorial Solid Waste
Management Officials and the National Association of Attorneys
General, to allow frequent and regular meetings of State represen-
tatives and agency officials. Through these arrangements, EPA
and the States will be able to continue the dialogue, begun in
the course of developing this policy document, to find solutions
to issues that arise in the course of CERCLA and related State
enforcement programs.
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
OCT I 2.1995
SOLID WASTE AND
MEMORANDUM
SUBJECT: Procedures for Issuing Notice Letters
rf «
FROM: Gene A. Lucero, Director ,
Office of Waste Programs Enforcement
TO: Directors, Waste Management Divisions
Regions I-X
Directors, Environmental Services Divisions
Regions I-X
Regional Counsels, Regions I-X
This memorandum provides guidance on preparing and
issuing notice letters. It reflects the Agency's policy on
allowing potentially responsible parties to conduct remedial
investigations and feasibility studies (RI/FS) and addresses
Regional concerns regarding notice letters. The guidance
consists of two major parts: a discussion of site specific
considerations in drafting notice letters and a generic
sample notice letter with explanatory discussion. The guidance
is intended to assist the Regions in developing technically
accurate notice letters that best effectuate the purpose of
notification under the Comprehensive Environmental Response,
Compensation, and Liability Act.
BACKGROUND
Section 104(a)(l) of the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 (CERCLA)
authorizes the President to spend CERCLA Trust funds to
clean up hazardous waste sites unless the President determines
that proper cleanup will be undertaken by the responsible
parties.
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A first step in determining whether a potentially
responsible party (PRP) is willing and financially capable
of undertaking a proper response is the issuance of notice
letters to identified PRPs. The letters inform PRPs of
their potential liability for cleanup and, under certain
conditions, provide them with an opportunity to undertake
necessary action after negotiation with the Agency. This
approach conforms with the Agency's policy to secure cleanup
by responsible parties, in lieu pf Superfund use, whenever
such cleanup can be accomplished in a timely and effective
manner.
While the Agency believes that notice letters are not
required by CERCLA and are not a precondition to cost
recovery, notice and the receipt of notice may help to
minimize the possibility of a PRP raising insufficient
notification as an issue in subsequent litigation.
The Office of Waste Programs Enforcement (OWPE) in the
Office of Solid Waste and Emergency Response (OSWER), in
consultation with the Office of Enforcement and Compliance
Monitoring - Waste (OECM-Waste), was initially given the
responsibility for drafting, reviewing, and issuina notice
letters to potentially responsible parties. The authority
to issue information requests under CERCLA was formally
delegated to the Regional Administrators on April 16, 1984
as part of an overall CERCLA delegation of authority. Notice
letter issuance was not formally addressed as part of this
delegation. This memorandum specifically clarifies the
authority to issue notice letters as lying with the Regional
Administrators. Each Regional Administrator may further
delegate the authority for issuance of notice letters to the
appropriate Regional Division Director.
In May 1983, the Office of Waste Programs Enforcement
issued draft notice letter guidance to the Regions that
outlined procedures for issuing notice letters to PRPs
concurrent with the conduct of a Fund-financed RI/FS. The
guidance also indicated that PRPs would be notified that an
Agency-financed RI/FS had begun or will soon begin and that
the PRPs may take over the RI/FS if they are unequivocally
willing to undertake the RI/FS and will commit to the
implementation of the remedy approved by EPA based on
the results of the RI/FS.
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Since this draft guidance was issued, the Agency has
established a new RI/FS policy. Under the new policy, the
Agency will now give PRPs the opportunity to participate in
the RI/FS process or conduct the RI/FS consistent with Agency
procedures and guidance. This policy was developed to allow
the Agency to target its enforcement priorities, reduce the
possibility of unsuccessful or protracted negotiations with
PRPs, and enhance the quality of a private-par :y RI/FS.
OSWER and OECM-Waste have issued a memorandum to the
Regional Air and Waste Management Division Directors and
Regional Counsels outlining the circumstances in which PRPs
may conduct the RI/FS and procedures for notifying PRPs in
such cases (see, "Participation of Potentially Responsible
Parties in the Development of Remedial Investigations and
Feasibility Studies under CERCLA," Lee Thomas, Courtney
Price, March 20, 1984). This revised RI/FS policy requires
the issuance of two sets of notice letters to PRPs: one for
the RI/FS and the other at or near the completion of the
RI/FS for the site remedy. Timing of notice letters is
discussed in detail later in this guidance.
POTENTIALLY RESPONSIBLE PARTY DETERMINATION
The type of factual evidence needed to establish that a
party is responsible for the problems at a particular site is
discussed in a previously issued guidance document entitled,
"Procedures for Identifying Responsible Parties at Uncontrolled
Hazardous Waste Sites - Superfund", Prepared by the Office of
Legal and Enforcement Counsel (February 1982).
The amount of such evidence depends on the circumstances
of each.case and should be determined by the Regional program
office in consultation with the Regional Counsel. In the
early stages of case development, any individual or company
even remotely associated with a particular site may be sent
initial information request letters. The responses to these
letters may then provide additional evidence linking certain
parties more closely to the site.
Ultimately, any party receiving a notice letter would be
considered a potentially responsible party. The issuance
of a notice letter, therefore, should be considered carefully
because it not only designates the recipient as a PRP but
opens the possibility of the PRP's name being released in
response to a Freedom of Information Act (FOIA) request.
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PURPOSE OF THE GUIDANCE
Initial notice letters issued by EPA were based on a
variety of models and were general enough to be applicable
to most potentially responsible parties simply by means of
inserting the name of the addressee. While adequate for
notification purposes, the content of those letters was
not tailored to reflect the circumstances present at each
site or the status of each PRP. Previous notice letters
were perceived, therefore, to have two limitations: they
did not adequately encourage a negotiated cleanup by the
PRP nor did they provide PRPs with an adequate level of
information on the Agency's planned or actual response
actions at the site.
This guidance is designed to assist Regional program
personnel in preparing sound and technically accurate notice
letters, in accordance with the Agency RI/FS policy,
that will encourage cleanup by potentially responsible parties.
Headquarters Program and Enforcement Counsel personnel will
not be involved in drafting or sending notice letters.
Nonetheless, copies of all CERCLA notice letters issued
(whether for RI/FS, removal actions, or remedial actions)
must be forwarded to OWPE; addressed to the Director; at the
same time they are sent to the potentially responsible parties.
Vital information on all notice letters sent will be. recorded
and tracked by the Superfund Enforcement Tracking System.
PURPOSE OF THE NOTICE LETTER
Notice letters will inform the potentially responsible
parties that Fund-financed actions are planned and/or have
been completed. Notice letters will provide PRPs with the
opportunity to undertake future actions, and will inform
PRPs of both their potential obligation under Section 106
of CERCLA to implement any needed relief actions determined
by EPA and their potential liablility under Section 107 of
CERCLA for the cost of Fund-financed actions if they do not
respond or fail to respond properly. PRPs will also be
informed of their opportunity to discuss with Agency personnel
the response measures to be performed.
Notice letters should generally include information
requests. Under Section 3007(a) of the Resource Conservation
and Recovery Act (RCRA), the Administrator has the authority
to require any person who generates, stores, treats, transports,
disposes of, or otherwise handles or has handled hazardous
waste to provide certain information on the identity, volume,
transporter, and time of the activity regarding the hazardous
wastes at the site in question. Section 104(e) of CERCLA
provides similar authority for all hazardous substances. The
facts gleaned from the information sent in response to such
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a request will assist the Regional Office in identifying
additional responsible parties as well as in preparing for
litigation or negotiating a voluntary cleanup. If this
information has already been obtained through a previous
information request letter, an information request in the
notice letter may not be necessary.
The Department of Justice has asked that future RCRA and
CERCLA referrals from the Agency contain information regardinc
the insurance coverage of PRPs. To that end, all information
requests under RCRA §3007 and CERCLA S104 should include a
request for information regarding the existence of insurance
coverage for damages resulting from releases of hazardous
substances and for copies of all such insurance policies,
both currently in effect and in effect during the period of
activity in question. This will enable the Department of
Justice to evaluate the extent of coverage in hazardous
waste cases and, where appropriate, to notify insurance
carriers directly of potential liability under CERCLA for
the costs of cleanup.
This guidance contains a generic sample notice letter
with explanatory discussion. Since each site and each PPP
will present different circumstances, this generic sample
notice letter is- designed to be flexible and can be easily
modified. Each site and PRP may dictate a different mix
of information in the letter actually sent to the PRP.
Various site specific and PRP specific considerations, which
are discussed below, along with the explanation accompanying
the generic sample notice letter will assist the Regions in
drafting notice letters which best effectuate the purposes
described above.
CONSIDERATIONS IN DRAFTING NOTICE LETTERS
Numerous site specific and PRP specific considerations
will affect the actual language of the notice letter. The
following factors should, therefore, be kept in mind when
drafting case specific letters:
The type of action contemplated (Rl/FS, removal or
remedial)
. The tone desired
The timing of the notice letter
Litigation involving the site
The type of release (actual, threatened, or both)
. The response desired
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Agency resources needed for follow-up to notice letter
Possible release of identities of responsible parties
The number of PRPs to whom notice letters must be sent
Some of these factors may be more important than others, and
in a given situation, several may in fact not even be
applicable. Each factor, however, should be assessed in
light of the specifics of the case so that the best possible
notice letter will result.
1) Type of Action
The type of action the Agency contemplates (immediate
removal, initial remedial measure (IRM), RI/FS, or remedial
action) will also affect the content of the notice letter.
In immediate removal situations, efforts to obtain private
party response may often begin with an oral notice from the
on-scene-coordinator, followed by a written notice letter
confirming the verbal request for response and notification.
In some emergency situations where a CERCLA Administrative
Order is issued to responsible parties, no notice letter is
sent per se. The Order is sent under a cover letter which
serves to notify the responsible parties of their liability
for cleanup costs.
IRMs are somewhat less urgent, thereby generally
eliminating the special need for oral notice prior to written
notice. Notice letters will be issued, followed by Agency
negotiations with the PRPs, aimed at securing private party
cleanup within an established period of time.
For sites where an RI/FS is planned, PRPs will be notified
of the opportunity to perform or participate in the RI/FS.
The Agency will make available a list of sites scheduled for
RI/FS development. This list will be published at least
annually, on a fiscal year basis, and may be updated quarterly
during the course of the year. Accompanying the list will
be a statement that PRPs can contact Agency personnel to
discuss their conduct of, or participation in, the RI/FS.
The Agency will then send notice letters to PRPs for sites
listed on the Superfund Comprehensive Accomplishments Plan.
The notice letters will inform the potentially responsible
parties that Fund-financed RI/FS actions are planned; that
the results of the studies will be used to select a remedy
for the site; that PRPs can meet with Agency personnel to
discuss their participation in or conduct of the RI/FS; that
PRPs may be liable for the costs of the.RI/FS performed by
the government; and that PRPs will have an opportunity to
meet with Agency personnel to discuss design and implementation
of the remedy after completion of the RI/FS.
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Upon completion of an RI/FS at a site, the Agency will
send notice letters to PRPs which should invite each PRP to
prepare comments on the draft RI/FS, offer the PRP the
opportunity to undertake the design and construction of the
remedy selected by the Agency, and indicate deadlines for
negotiations with the Agency. All notice letters, whether
for removal, RI/FS, or remedial actions, should inform the
PRP of both his/her potential obligation under Section 106
of CERCLA to implement any needed relief actions determined
by EPA and potential liability under Section 107 of CERCLA
for any Fund-financed activities performed at the site and
describe the next response action which is expected to occur.
2) Tone
The tone a notice letter projects will indicate the
Agency's position as clearly as any specific language the
letter contains. The desired tone will be achieved by language
that clearly outlines the PRP's potential statutory liability
and yet is encouraging regarding prospective negotiations.
The letter should encourage cooperative discussion between
the PRP and the Agency. Ultimately, however, program personnel
in consultation with the Regional Counsel must exercise
their own discretion in setting the tone and emphasis that
best effectuates the purposes of the notice letter.
The letter should not indicate that the Agency has made
a final determination of liability. Such determinations are
made only if and when the Agency pursues an enforcement
action against a responsible party.
3) Timing of Notice Letter
In general, notice letters should be issued as soon as
possible after completion of the responsible party search
and prior to any Federally-financed response actions. The
notice letter may be an initial contact, or a followup to
an oral notice. If it is EPA's initial contact with the PRP,
a more detailed explanation of CERCLA and its ramifications
for the PRP would be appropriate.
In the case of immediate.removal actions, written
notification may not be feasible, and only oral notification
may be possible. A notice letter should immediately be sent
confirming the oral notice, reiterating the pertinent facts
and any agreements that were reached, and expanding on the
party's responsibilities under CERCLA. This type of notice
letter would necessarily be structured somewhat differently
than an "initial contact" notice letter. In addition, the
PRP's response to an oral notification will affect the content-
of the notice letter. Other oral or written communication
with the PRP, where appropriate, should be recognized in the
notice letter as well.
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For RI/FS actions, notice letters will be issued only
after a site appears on the Superfund Comprehensive
Accomplishments Plan (SCAP) and should normally be.issued no
later than sixty days before the scheduled date for obligation
of funds for the RI/FS. Timing of the notice letter should
take into account the number of PRPs and the complexity of
the data associating PRPs with the site. Sufficient time
should be allowed to enable the Regional Office to collect
and analyze data received from PRPs in response to any
information request that may be contained in the notice
letter. In addition, PRPs should have sufficient time to
organize into a steering committee to speak on behalf of as
many PRPs as possible when discussions on the RI/FS begin.
Timely completion of these activities will help avoid
unnecessary delays in meeting Fund-financed RI/FS commitments
set forth in the SCAP.
Once resources for an Agency-financed RI/FS have been
obligated, the PRP will not be allowed to take over development
of the RI/FS. Further, in the event a PRP is discovered
after the Fund-financed RI/FS has been initiated or completed
(e.g., due to newly discovered evidence), a notice letter
should still be sent as soon as is practical. The letter
should contain language urging the PRP to undertake the
design and construction of a remedy following completion of
the RI/FS and inform the PRP of his/her potential liability
for activities already performed at the site as well as any
future activities. • The letter may" take the form of a
combination notice letter/demand letter.
Under certain circumstances, up to three notice letters
may be appropriate. An initial notice letter could be sent
prior to a Fund-financed immediate removal or IRM. A second
notice letter will be sent when the Agency plans to undertake
an RI/FS. A third notice letter will be issued when the
Agency has completed or is nearing completion of the RI/FS
and approximately thirty days in advance of the public comment
period on the RI/FS. More than thirty days may be appropriate
if there exist a large number of PRPs at a site.
4) Litigation Involving the Site
If potentially responsible parties are involved in RCRA,
CERCLA, or other Federal litigation at the site, the Department
of Justice (DOJ) must be informed of any notice letters which
the Agency is planning to send. Notice letters in these
situations will be issued by the Regional program office
only after consultation with DOJ and Regional Counsel. In
these situations, copies of notice letters issued and
responses received must be forwarded to DOJ and to the
Office of Enforcement and Compliance Monitoring - Waste
(OECM-Waste) in addition to OWPE.
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5) Type of Hazardous Substance Release
Discussion of the type of release or threatened release
may involve terminology unfamiliar to the PRP. The notice
letter should, however, at l4ast identify whether the episode
involves a release or a threatened release of hazardous
substances and, if the information is available and supportable,
the substances involved. Regional program personnel have
wide latitude when drafting the notice letter to decide the
appropriate depth of technical discussion.
6) Type of Response Desired
Notice letters should be issued in accordance with a
plan developed by the case management team. This should
allow Regional personnel to be adequately prepared for
immediate questions and requests for documents that may
arise as a result of the letters, as well as any negotiations
that may subsequently occur. In most circumstances, the
notice letter should specifically request a written response
from the PRP.
In some cases, such as where a great number of PRPs
exist, a somewhat different response may be requested from
those PRPs which EPA believes contributed most significantly
to th^ hazardous substances at the site. For example: the
case Management team may select a "tier" of PRPs. The notice
letter sent to this tier of PRPs may include an invitation
to initiate negotiations with EPA, while the notice letter
sent to the remaining PRPs may only request a written
response.
In limited cases, such as where a great number of PRPs
are to respond within a short period of time (i.e., 24 - 48
hours), Agency personnel may be inundated with a number and
variety of responses. Requesting initial oral responses
(directed to a specified telephone number where specific
questions will be asked), with written responses or
informational meetings with a select group or all PRPs to
follow, may be appropriate. Under all circumstances, contact
with the Agency in any form should be encouraged.
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7) Resources Needed for Follow-Through Activity
In issuing notice letters it is important to consider
carefully the resources necessary to follow through with the
next phase of activity. In particular, the Region issuing
the notice letter should be prepared to make timely and
appropriate responses to questions from PRPs and to conduct
negotiations. It may be helpful to assemble: a fact sheet,
a list or package of references regarding the site, and/or
applicable guidance describing what the Agency considers to
be necessary prerequisites to PRP performance of any removal,
RI/FS, or remedial action. This may not always be possible
during the early phases of site management planning due to
the lack of detailed information both on the site and on
remedial alternatives. The notice letters should, therefore,
only be issued after discussion with Regional Counsel regarding
meeting times and the enforcement strategy for the site.
8) Release of Identities of Potentially Responsible
Parties to Facilitate Superfund Negotiations
The names and addresses of potentially responsible
parties should be released prior to Superfund negotiations
to encourage the PRPs to organize among themselves in order
to reach a settlement with EPA and in accordance with the
following guidelines:
- The release of the names of potentially responsible
parties prior to negotiations should occur routinely
to all potentially responsible parties receiving notice
letters and a list of PRP names and addresses should
be attached to the notice letter. This information
will encourage prenegotiation organization among PRPs
and may facilitate meeting negotiation deadlines.
- A cover letter attaching the list of PRP names and
addresses should include the following disclaimer:
This list represents EPA's preliminary findings on
the identities of potentially responsible parties.
Inclusion on this list does not constitute a final
determination concerning the liability of any
party for the hazard or contamination at the site
in question.
- PRP names may also be released in response to Freedom
of Information Act (FOIA) requests. Relevant guidance
is included in the January 26, 1984 memorandum from
Gene A. Lucero and Kirk F. Sniff/ titled; "Releasing
Identities of Potentially Responsible Parties in
Response to FOIA Requests".
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9) The Number of Parties to Whom Notice Letters Must be Sent
Notice letters should be. sent to every PRP at a site.
The Regions may, as a matter of program discretion, issue.
notice letters which request a different response from various
PRPs, as described previously in this guidance. The immediacy
of the hazard at tl e site may limit the number of PRPs that
will initially receive notice letters. This approach will
facilitate negotiations with potentially responsible parties
so that response actions can begin promptly. The Regions
should later issue notice letters to the remaining PRPs,
after the immediate hazard at a site has been abated.
CONSIDERATIONS ON THE USE OF THE GENERIC SAMPLE NOTICE LETTER
The generic sample notice letter which follows this
discussion (page 13) is a combined notice letter/information
request letter and is an example only. The generic letter
should be modified according to the considerations outlined
above and should reflect the specific circumstances of the
case. While several or possibly even hundreds of letters
per site may necessarily be somewhat similar, each letter
should, whenever possible, be considered individually and
tailored to include PRP specific and site specific factors.
FORMAT OF GENERIC SAMPLE -NOTICE LETTER
The generic sample notice letter and following analysis
are for a site in which the Agency is planning an RI/FS.
Notice letters for immediate removals, IRMs, and design
and implementation of site remedies may also be drafted by
modifying this generic sample notice letter.
.For identification purposes, the sample letter is divided
into twenty paragraphs, labeled Paragraph A through Paragraph T,
Different language alternatives are offered within the text
of the generic sample notice letter. A two bracket system
(outer and inner brackets) has been used. An outer set of
brackets will contain instructions (in capital letters).
The language alternatives will be contained in inner brackets.
For example:
The [CHOOSE ONE:
1. [release]
2. [threat of release]]...
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For consistency, if the bracketed material only contains
instructions and no alternatives both inner and outer brackets
will be used. For example:
The [[name of site]] site...
A paragraph by paragraph analysis accompanies the generic
sample notice letter to help in tailoring the generic letter
to the circumstances of a particular site.
USE OF THIS GUIDANCE
The policy and procedures set forth here/ and internal
office procedures adopted in conjunction with this document,
are intended for the guidance of staff personnel, attorneys,
and other employees of the U.S. Environmental Protection
Agency. They do not constitute rulemaking by the Agency,
and may not be relied upon to create a right or benefit,
substantive or procedural, enforceable at law or in ecruity,
by any person. The Agency may take any action at variance
with the policies or procedures contained in this memorandum
or which are not in compliance with internal office procedures
that may be adopted pursuant to those materials.
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GENERIC SAMPLE NOTICE LETTER FOR THE CONDUCT OF AN RI/FS *
Paragraph A
Certified Mail:
Return Receipt Requested
Paragraph B
Name of PRP
Mailing Address of PRP
Paragraph C
Re: Name of Site
Address of location of site
Paragraph D
Dear [[name of PRP if individual is known, "Sir or Madame"
if otherwise]]:
Paragraph E
The United States Environmental Protection Agency
iEPA) is considering spending public funds to investigate
and take corrective action for the control of [CHOOSE ONE
OR BOTH, AS APPROPRIATE:
1. [releases]
2. [threatened releases]]
of hazardous substances at the above referenced site.
Unless EPA determines that a responsible party will properly
perform such actions, EPA intends to do so pursuant to
Section 104 of the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C. 9601
et seq {CERCLA).
Under Sections 106(a) and 107(a) of CERCLA and other laws,
responsible parties may be obligated to implement any needed
relief actions determined by EPA and may also be liable for
all costs incurred by the government in responding to any
release or threatened release at the site. Such costs can
include, but are not be limited to, expenditures for
investigation, planning, cleanup of the site and enforcement.
By this letter EPA notifies you of your potential liability
with regard to this matter and encourages you to voluntarily
undertake cleanup activities which will be overseen by EPA.
* Note that a specific explanation regarding each paragraph
begins on page 20.
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Paragraph F
Responsible parties under CERCLA include current and
past owners and operators, as well as persons who generated
the hazardous substances or were involved in the transport,
treatment, or disposal of them. Based on [[identify here
any evidence obtained by EPA that documents the PRP's
connection with the site such as site records, manifests,
state records, corporate records, etc.]], EPA has information
indicating that you may be a responsible party. More
specifically, the Agency has reason to believe that [CHOOSE
THE APPROPRIATE BRACKET:
1. [you]
2. [your company]
3. [name the company]]
[CHOOSE THE APPROPRIATE BRACKETED CLAUSE:
1. [were the owner/operator of the facility]
2. [were a former owner/operator of the facility
at the time of disposal of hazardous
sustances at the facility]
3. [did, by contract, agreement, or otherwise;
arrange for the disposal, treatment, or
transportation for disposal or treatment
of hazardous substances at the facility]
4. [accepted hazardous substances for transport
to disposal or treatment facilities selected
by you]]
during the period [[specify dates that the PRP engaged in
the activity]] .
Paragraph G
EPA has determined that [CHOOSE APPROPRIATE BRACKETED
CLAUSE:
1. [a release of hazardous substances (as defined
by section 101(14) of CERCLA) has occurred
at]
2. [there is a substantial threat of release of
hazardous substances (as defined by section
101(14) of CERCLA) from]]
the above referenced facility. At the present time, [[identify
substance(s) at the site that was(were) handled by the PRP
or the name of substance(s) found at the site if the PRP
is(was) an owner or operator]] is [CHOOSE ONE OR BOTH, AS
APPROPRIATE:
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1. [contaminating]
2. [threatening to contaminate]]
[[Identify the pathway of contamination. Include here site
specific information on why there is a reasonable likelihood
that a release is threatened.]] As a result of [[the threat
of]] such release, {[describe population reasonably expected
to be exposed/harmed and/or water-bodies or land areas
reasonably expected to be affected]]. The Agency will, upon
request, discuss this information with you and will provide
additional information on the nature and extent of the [CHOOSE
ONE OR BOTH, AS APPROPRIATE:
1. [release]
2. [threatened release]]
Instructions on how to contact the Agency's representative,
[[name of EPA contact]], are set out below. We urge you to
contact [[name of EPA contact]] as soon as possible.
Paragraph H
EPA is planning to conduct the following studies at the
[[name of site]] site:
1. Further investigations to identify the local
hydrogeological characteristics and define the
nature and extent of soil, air, and surface water
contamination at the site and
2. Feasibility studies to evaluate possible remedial
actions to remove or contain hazardous substances,
pollutants, and contaminants at the site.
In addition to the above studies, you may be asked at
a later date to undertake, or may be liable for, any additional
corrective measures necessary to protect public health,
welfare, or the environment. Such measures may include, but
are not limited to:
1. Implementing initial remedial measures, e.g., securing
the site to prevent contact with any hazardous
substances that may be present at the site and/or
removal of contaminated material from the surface
of the site;
2. Designing and implementing the EPA approved remedial
option; and
3. Providing any monitoring and maintenance necessary
after remedial measures are completed.
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Paragraph I
EPA will consider an immediate offer from you to conduct
the remedial investigations and feasibility studies (RI/FS)
described above in accordance with an'EPA work plan or the
EPA RI/FS guidance. Alternately, you may elect to participate
in the RI/FS. You should notify EPA, in writing within
I[specify number of days]] calendar days from the receipt of
this letter, of your willingness to conduct or participate
in the RI/FS. Otherwise, EPA will assume that you decline
any involvement in the RI/FS and will proceed with the
appropriate studies and any initial remedial measures needed
to secure the site. EPA may later invite you to undertake
the design and implementation of the selected remedy upon
the Agency's completion of the RI/FS.
Your letter should indicate the appropriate name, address,
and telephone number for further contact with you. If you
are already involved in discussions with state or local
authorities, engaged in voluntary action, or involved in a
lawsuit regarding this site, you should continue such
activities as you see fit; you should not.interpret this
letter to advise or direct you to restrict or discontinue
any such activities. You should report, however, the status
of those discussions or that action in your letter. Please
provide a copy of your letter to any other parties involved
in those discussions.
Paragraph J
Your letter should be sent to:
[[Name of EPA program official or case attorney
in charge of this case:
Section, Division
US EPA - Region (t)
Street
City, State, Zip Code]]
If you need further information, [[name of EPA official in
charge of this case (same as above)]] can also be reached by
telephone at [[telephone I]].
Paragraph K
EPA would like to encourage good faith negotiations
between you and the Agency and among you and other parties
potentially responsible for the [[name of site]] site. The
names of the other potentially responsible parties [CHOOSE
THE APPROPRIATE BRACKET:
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1. [have been revealed to you]
2. (may be revealed to you if you
specifically request, in writing,
such information]]
so that you may schedule meaningful discussions with other
potentially responsible parties regarding cleanup efforts
and quickly organize yourselves into a single representative
body to facilitate negotiations with the Agency.
Paragraph L
In addition, EPA is seeking to obtain certain information
from you for the purpose of enforcing the appropriate provisions
of [[CERCLA and/or the Resource Conservation and Recovery Act,
as amended by the Solid Waste Disposal Act Amendments of 1980
(RCRA)]], and to assist the Agency in determining the need for'
a response to a release of hazardous substances under CERCLA.
Under the provisions of [[Section 104 of CERCLA, 42 U.S.C.
6927, and/or Section 3007 of RCRA, 42 U.S.C.'9604]], the
Administrator of the Environmental Protection Agency has the
authority to require any person who generates, stores, treats,
transports, disposes of, or [[otherwise handles or has handled])
hazardous [[wastes and/or substances]] to furnish information
related to such [[wastes and/or substances]]. Pursuant to
this statutory provision, you are hereby requested to answer
the following questions:
1. What is the generic name and chemical character of
the [[hazardous wastes and/or hazardous substances]],
as defined under [[Section 1004(5) of RCRA and/or
Section 101(14) of CERCLA]], that you [[generate,
store, treat, transport, dispose, or otherwise handle
or have handled]] at the [[name of site]] site?
2. For each [[hazardous waste and/or hazardous
substance]] identified above, please give the total
volume, in gallons for liquids and in cubic meters
for solids, for which you [[generate, store, treat,
transport, dispose, or otherwise handle or have
handled]] and list when this activity occurred.
3. What arrangements were made to transport these
[[hazardous wastes and/or hazardous substances]] to
the [[name of site]] site?
4. Who was the transporter of these [[hazardous wastes
and/or hazardous sustances]], what was his/her
previous address, and what is his/her current address"5
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5. Please provide any other information, correspondence,
etc. retained by your comoany,regarding the [[name
of site]] site.
Paragraph M
For the above questions, please describe the types of
records that were maintained by your company of the transactions
with the [[name of site]] site including the date of the
records, the author of the records, the current location of
the records, and the current custodian and all efforts that
were taken to identify these records. If, in answering any
of the above questions, information was obtained through
employee interviews, indicate so in your letter and provide
the names of the employees interviewed. Pursuant to Section
103 (d)(2) of CERCLA, it is unlawful for any person knowingly
to destroy, mutilate, erase, dispose of, conceal, or otherwise
render unavailable or unreadable or falsify any records.
In addition to the above information, if [CHOOSE
APPROPRIATE BRACKET:
1. [you are]
2. [your company is]]
insured for any damages resulting from the release of
hazardous wastes and/or hazardous substances, please inform
us of the existence of such insurance and provide us with
copies of all insurance policies both currently in effect
and in effect during the period of [from to .]
Paragraph N
Your response to this request for information must be
sent to EPA (at the above address) within thirty calendar
days of your receipt of this letter. [[Under Section 3008
of RCRA, 42 U.S.C. 6928, failure to comply with this request
may result in an Order requiring compliance or a civil action
for appropriate relief, including penalties and/or failure to
comply with this request under Section 104 of CERCLA may
result in a civil enforcement action against you by EPA.]]
Paragraph O
EPA regulations governing confidentiality of business
information are set forth in Part 2, Subpart B of Title 40
of the Code of Federal Regulations. For any portion of the
information submitted which is entitled to confidential
treatment, a confidentiality claim may be asserted in accordance
275
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- 19 -
with 40 CFR Section 2.203(b). If EPA determines that the
information so designated meets the criteria set forth in 40
CFR Section 2.203, the information will be disclosed only to
the extent, and by means of the procedures specified in 40
CFR Part 2, Subpart B. EPA will construe the failure to
furnish a confidentiality claim with response to this letter
as a waiver of that claim, and information may be made
available to the public by EPA without further notice.
Paragraph P
Your reply to the request for information under [[Section
104 of CERCLA and/or Section 3007 of RCRA]] should be considered
separate and distinct from your reply relating to participation
in cleanup response activities at the site.
Paragraph Q
The factual and legal discussions contained in this
letter are intended solely for notification and information
purposes. They are not intended to be and can not be
relied upon as a final Agency position on any matter set
forth herein.
Paragraph R
Due to the seriousness of the problem at this site and
the attendant legal ramifications, the Agency strongly
encourages you to submit a written response within the time
frame specified herein. We hope that you will give these
matters your immediate attention.
Paragraph S
Sincerely yours,
[[name of Regional Administrator]]
Regional Administrator, Region [[_#_]]
Paragraph T
cc: Regional Counsel, Region [[ t ]1
Director, Office of Waste Programs Enforcement
[[Registered Agent, if PRP is a partnership or corporation]]
[[Chairman of the Board, if PRP is a partnership
or corporation]]
[[Corporate Counsel, if PRP is a partnership or corporation]]
276
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- 20 -
ANALYSIS OF GENERIC SAMPLE NOTICE LETTER FOR THE CONDUCT OF AN
RI/FS !
Paragraph A
Notice letters usually will be sent certified mail,
return receipt requested. While the Agency believes that
notice letters are not required by CERCLA and are not a
precondition to cost recovery, notice and the receipt of
notice may be raised by FRPs as an issue at a later date.
If the Region expects that a PRP may try to avoid service of
the notice letter, it may be appropriate to send the letter
by Express Nail, hand delivery or process server. This will
avoid the possibility of the PRP successfully raising the
defense of insufficient service in any later litigation.
The receipts should be attached to a copy of the notice
letter kept in the regional files. Note that notice letters
to non-U.S. PRPs (e.g., Canadian) must be sent by registered
mail.
Paragraph B
In completing the inside address, a decision must be
made regarding the party to be named as a PRP. For individuals
who are PRPs, their name (and any aliases) and their home
address will be satisfactory. For corporate PRPs, the
corporation should be the recipient with the notice letter
addressed to the attention of the President of the Corporation
with copies going to the Chairman of the Board of Directors
and Corporate Counsel (if there is one). If the present
whereabouts of the officers or the status of a corporate PRP
is unknown, the letter should be addressed to the registered
agent for that corporation. If the notice letter includes a
CERCLA 5104 and RCRA S3007 information request, the Region
may want to send a copy to the local corporate office which
may be more able to respond to the information request. The
use of names of specific individuals, when known, may expedite
a response.
Paragraph C
The subject address should list both the EPA designated
name and any local names for the site. If no street address
is available, location should be given by the names of the
county, township, village or other political subdivision, or
by any other information that describes the site with some
specificity.
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Paragraph E
The first textual pargraph generally will^set the tone
for the entire letter. This particular sample paragraph
sets forth the basic information that the letter needs to
convey and combines language on legal liablility with other
more encouraging language. A lead paragraph such as this is
suitable for inclusion in a letter to all types of PRPs.
Overuse of legal language in this first paragraph, however,
is to be avoided.
Alternative language for this paragraph that amplifies
the fact that the Agency has already spent money investigating
the site would be as follows:
"The United States Environmental Protection Agency (EPA)
has expended public funds to investigate [CHOOSE ONE OR
BOTH, AS APPROPRIATE:
1. [releases]
2. [threatened releases]]
of hazardous substances at the above referenced site. EPA
may spend additional public funds on actions to control such
releases and/or threatened releases. Unless EPA determines
that •« responsible party will properly perform such actions,
EPA intends to do so pursuant to Section 104 of the
Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, 42 U.S.C. 9601 et seq (CERCLA)."
Paragraph F
The information needed to complete a paragraph such as
this should be fairly obvious from program or enforcement
files. In the actual letter, only that language that pertains
to the type of PRP the letter is addressing (i.e., owner/
operator, generator, or transporter) need be included.
The type and amount of evidence connecting the PRP to
the site that must be included in the letter is important.
The best pieces of evidence include evidence actually obtained
from the site and affidavits obtained from knowledgeable
parties, although textual reference materials on corporate
activities (such as S.E.C. annual 10-K reports, ftin &
Bradstreet's Business Information Reports, and Moody's
Industrial Manual) also are adequate. "Procedures for
Identifying Responsible Parties at uncontrolled Hazardous
Waste Sites - Superfund" (February 1982) provides additional
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guidance on the type of factual evidence needed to designate
a party as a PRP. If the PRP was initially identified by
other PRPs, care must be taken to protect against disclosure
of the identities of confidential sources.
Paragraph G
This section of the letter can contain the technical
basis for the need to take action under CERCLA. It also,
necessarily, contains the most technically complex information
in the notice letter. For those sites where less information
is readily available at the time the letter is drafted or
for other tactical reasons, this paragraph may be less specific
than is suggested. In any event, major changes to the generic
sample letter may be necessary due to site speci.fic or PRP
specific information.
Paragraph H
The letter should contain a description of the general
steps that need to be taken to complete the RI/FS. In no
case should the notice letter exclude the possibility that
other work, beyond that mentioned, may be necessary.
Paragraph I
The letter should indicate that EPA is planning to
conduct the RI/FS and provide the PRP with a time frame to
indicate their willingness to perform or participate in the
RI/FS. For immediate removals or IRMs this paragraph would
have to be modified to offer the PRPs the opportunity to
undertake voluntary site work and request that the PRP notify
the Agency of the nature and extent of corrective measures
the PRP is willing to perform. Upon completion of the draft
RI/FS, this paragraph should invite the PRP to prepare
comments on the draft RI/FS, offer the PRP the opportunity
to undertake design and construction of the remedy selected
by the Agency, and indicate deadlines for negotiation with
the Agency.
This paragraph offers the PRP the alternative of
participating in the RI/FS. The Agency's relationship with
the PRP and the characteristics of the PRP will dictate
whether any alternatives to actual response (e.g., settlement
offers) should be offered in the notice letter.
The notice letter must contain a demand for response
and set a deadline response time. Suggested optimum response
times are as follows:
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Immediate Removals (if 24 - 48 hours
letter feasible)
Initial Remedial Measures, 2 weeks to
Remedial Investigations and 30 days
Feasibility Studies
Remedial Design and Reiiedial 2 weeks to
Actions,(opportunity to 30 days
comment on RI/FS)
The information the Agency requires in the PRP's response
letter may vary based on the Agency's knowledge of the site,
the PRP, and the extent of work completed at the site. At a
minimum, the notice letter should request the appropriate
name, address, and telephone number for further contact.
Since there is no basis for EPA to advise the responsible
party either to continue, limit, or discontinue any of the
activities listed in this third paragraph, the language has
changed slightly from previous drafts.
Paragraph J
The contact point may vary from region to region or
from site to site within a region. In some regions it may
be the case attorney-and in others it may be someone from
the technical staff.
In most situations, a written response will be requested
from the PRP. If, however, the site involves numerous PRPs
who must respond in a short period of time, the response
requested may be oral with a written confirmation or information
meetings with all PRPs to follow, in that case, the contact
point would be an Agency telephone number and the person
answering would ask the calling PRP a series of predetermined
questions designed to create uniform information from the
responses.
Paragraph K
Past notice letters have stated that, at this stage of
the process, the Agency will not disclose to the public (or
other PRPs) the names of potentially responsible parties,
nor will the information be available through Freedom of
Information Act requests.
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Agency policy has since been modified to allow release
of PRP names or other information about a CERCLA site, in
response to a FOIA request. The Agency may also elect to
release the names-in other circumstances where disclosure of
this information does not interfere with site enforcement
actions. The document, "Releasing Identities of Potentially
Responsible Parties in Response to FOIA Requests" (Lucero
and Sniff, January 1984), provides a detailed explanation of
this policy.
The identities of other PRPs may be provided at the
same time the notice letter is issued if the Region decides
that the release of PRP names with the notice letter may
encourage the PRPs to assemble as a single unit for
negotiations with the Agency. Otherwise, notice letters
should inform the recipient that the identities of other
PRPs may be obtained prior to Superfund negotiations if the
PRP submits a written request to the Agency for such
information.
Paragraphs L, M, N, O, and P
These five paragraphs present RCRA Section 3007 and/or
CERCLA Section 104 information requests. Note that as a
routine element of all information request letters, the
Agency will now include a request for copies of all insurance
policies that may provide liability coverage for damages
resulting from releases of hazardous substances and/or
hazardous wastes. This includes policies that are currently
in effect as well as those effective during the period of
activity in question.
The timing and use of information requests will vary
with the circumstances of each enforcement case. It may not
always be necessary .to include an information request at the
time a notice letter is sent. Frequently information requests
already have been made and responded to by the time the
notice letter is prepared, and sometimes facts contained in
information request responses provide a foundation for notice
letters. The decision to include Section 3007 and/or Section
104 requests in the notice letter is a matter of Regional
discretion. We encourage the issuance of information request
letters, whether alone or in combination with notice letters,
at the case development stage. Once a case is filed, however,
other information gathering techniques such as interrogatories
or depositions, where available, should be used in lieu of
information request letters.
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Note that under these sections, the Administrator has
the authority to request information only for certain purposes:
enforcing the provisions of the Acts, determining the need
for a response to a release, or developing regulations.
Thus all letters must clearly indicate one of these three
purposes. In general, information request letters that do
not serve the dual purpose of providing notice to PRPs of
potential CERCLA action should contain a general statement
of purpose that might read as follows:
This information is requested by EPA pursuant to
{[Section 104 of the Comprehensive Environmental
Response, Compensation, and Liability Act (CERCLA),
42 U.S.C. $9604 and/or Section 3007 of the Resource
Conservation and Recovery Act, (RCRA), 42 U.S.C.
§6927, as amended by the Solid Waste Disposal Act
Amendments of 1980]], to assist the Agency in
determining the need for response to a release of
hazardous substances under CERCLA and for the purpose
of enforcing the provisions of CERCLA and RCRA.
Note the statutory and regulatory definitions of hazardous
waste and hazardous substance when referencing either RCRA
and/or CERCLA authority in both Paragraph L and Paragraph N.
There may be instances in vhich EPA does not have the legal
authority to cite both statutes as a basis for an information
request.
Paragraph Q
The notice letter does not reflect a final Agency position
and should not be relied upon by PRPs or other parties as
establishing the Agency's factual or legal position on
any issue. A short carefully phrased statement to this
effect should be included in the notice letter.
Paragraph R
The closing paragraph should focus on the two most
important purposes of the letter: (1) to notify the PRP of
the liabilities they face and (2) to encourage the PRP to
negotiate with the Agency. In addition, the closing paragraph
should reemphasize the urgency of the problem and the Agency's
desire for immediate action by the PRP.
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Paragraph S
Consistent with the April 16, 1984 CERCLA delegation of
authority, the signatory of this notice letter is the Regional
Administrator. This may be further delegated to the Regional
Division Director.
Paragraph T
If the PRP is involved in litigation over the site,
copies must also be sent to the Department of Justice and
OECM-Waste.
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
MEMORANDUM
SUBJECT:
FROM:
OK-5084
JRCLA Settlement Policy
TO:
?e M. Thomas> Assistant Administrator
o&fice of Solid Wa^he and Emergency Response
Courtneyh. Pri'ce, RsVk&cant Administrator
of giKfrsvCement and Compliance Monitoring
P. fieniry.XabicTitf II, Assistant Attorney General
Land andvjfetural Resources Division
Department of Justice
Regional Administrators, Regions I-X
This memorandum sets forth the general principles governing
private party settlements under CERCLA, and specific procedures
for the Regions and Headquarters to use in assessing private
party settlement proposals. It addresses the following topics:
1. general principles for EPA review of private-party cleanup
proposals;
2. management guidelines for negotiation;
3. factors governing release of information to potentially
responsible parties;
4. criteria for evaluating settlement offers;
5. partial cleanup proposals;
6. contribution among responsible parties;
7. releases and covenants not to sue;
8. targets for litigation;
9. timing for negotiations;
10. management and review of settlement negotiations.
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APPLICABILITY
•This memorandum incorporates the draft Hazardous Waste
Case Settlement Policy, published in draft in December of
1983. It is applicable not only to multiple party cases but
to all civil hazardous waste enforcement cases under Superfund.
It is generally applicable to imminent hazard enforcement
actions under section 7003 of RCRA.
This policy establishes criteria for evaluating private
party settlement proposals to conduct or contribute to the
funding of response actions, including removal and remedial
actions. It also addresses settlement proposals to contribute
to funding after a response action has been completed. It
does not address private-party proposals to conduct remedial
investigations and feasibility studies. These proposals are
to be evaluated under criteria established in the policy guidance
from Lee M. Thomas, Assistant Administrator, Office of Solid
Waste and Emergency Response, and Courtney Price, Assistant
Administrator, Office of Enforcement and Compliance Monitoring
entitled " Participation of Potentially Responsible Parties in
Development of Remedial Investigations and Feasibility Studies
under CERCLA". (March 20, 1984)
I. General Principles
The Government's goal in implementing CERCLA is to achieve
effective and expedited cleanup at as many uncontrolled hazardous
waste facilities as possible. To achieve this goal, the Agency
is committed to a strong and vigorous enforcement program. The
Agency has made major advances in securing cleanup at some of
the nation's worst hazardous waste sites because of its demonstrated
willingness to use the Fund and to pursue administrative and
judicial enforcement actions. In addition, the Agency has obtained
key decisions, on such issues as joint and several liability,
which have further advanced its enforcement efforts.
The Agency recognizes, however, that Fund-financed cleanups,
administrative action and litigation will not be sufficient to
accomplish CERCLA's goals, and that voluntary cleanups are
essential to a successful program for cleanup of the nation's
hazardous waste sites. The Agency is therefore re-evaluating
its settlement policy, in light of three years experience with
negotiation and litigation of hazardous waste cases, to remove
or minimize if possible the impediments to voluntary cleanup.
As a result of this reassessment, the Agency has identified
the following general principles that govern its Superfund
enforcement program:
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The goal of the Agency in negotiating private party cleanup
and in settlement of hazardous waste cases has been and will
continue to be to obtain complete cleanup by the responsible
parties, or collect 100% of the costs of the cleanup action*
Negotiated private party actions are essential to an effective
program for cleanup of the nation's hazardous waste sites.
An effective program depends on a balanced approach relying
on a mix of Fund-financed cleanup, voluntary agreements
reached through negotiations, and litigation. Fund-financed
cleanup and litigation under CERCLA will not in themselves
be sufficient to assure the success of this cleanup effort.
In addition, expeditious cleanup reached through negotiated
settlements is preferable to protracted litigation.
A strong enforcement program is essential to encourage
voluntary action by PRPs. Section 106 actions are particularly
valuable mechanisms for compelling cleanups. The effectiveness
of negotiation is integrally related to the effectiveness of
enforcement and Fund-financed cleanup. The demonstrated
willingness of the Agency to use the Fund to clean up sites
and to take enforcement action is our most important tool
for achieving negotiated settlements.
The liability of potentially responsible parties is strict,
joint and several, unless they can clearly demonstrate that
the harm at the site is divisible. The recognition on the
part of responsible parties that they may be jointly and
severally liable is a valuable impetus for these parties to
reach the agreements that are necessary for successful
negotiations. Without such an impetus, negotiations run a
risk of delay because of disagreements over the particulars
of each responsible party's contribution to the problems at
the site.
The Agency recognizes that the factual strengths and weaknesses
of a particular case are relevant in evaluating settlement
proposals. The Agency also recognizes that courts may consider
differences among defendants in allocating payments among
parties held jointly and severally liable under CERCLA. While
these are primarily the concerns of PRPs, the Agency will also
consider a PRP's contribution to problems at the site, including
contribution of waste, in assessing proposals for settlement and
in identifying targets for litigation.
Section 106 of CERCLA provides courts with jurisdiction to
grant such relief as the public interest and the equities of
the case may require. In assessing proposals for settlement
and identifying targets for litigation, the Agency will
consider aggravating and mitigating factors and appropriate
equitable factors.
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0 In many circumstances, cleanups can be started more quickly
when private parties do the work themselves, rather than
provide money to the Fund. It is therefore preferable for
private parties to conduct cleanups themselves, rather than
simply provide funds for the States or Federal Government
to conduct the cleanup.
0 The Agency will create a climate that is receptive to private
party cleanup proposals. To facilitate negotiations, the
Agency will make certain information available to private
parties. PRPs will normally have an opportunity to be
involved in the studies used to determine the appropriate
extent of remedy. The Agency will consider settlement
proposals for cleanup of less than 100% of cleanup activities
or cleanup costs. Finally, upon settling with cooperative
parties, the government will vigorously seek all remaining
relief, including costs, penalties and treble damages where
appropriate, from parties whose recalcitrance made a complete
settlement impossible.
0 The Agency anticipates that both the Fund and private resources
may be used at the same site in some circumstances. When
the Agency settles for less than 100% of cleanup costs, it
can use the Fund to assure that site cleanup will proceed
expeditiously, and then sue to recover these costs from non-
settling responsible parties. Where the Federal government
accepts less than 100% of cleanup costs and no financially
viable responsible parties remain, Superfund monies may be
used to make up the difference.
0 The Agency recognizes the value of some measure of finality
in determinations of liability and in settlements generally.
PRPs frequently want some certainty in return for assuming
the costs of cleanup, and we recognize that this will be a
valuable incentive for private party cleanup. PRPs frequently
seek a final determination of liability through contribution
protection, releases or covenants not to sue. The Agency
will consider releases from liability in appropriate situ-
ations, and will also consider contribution protection in
limited circumstances. The Agency will also take aggressive
enforcement action against those parties whose recalcitrance
prevents settlements. In bringing cost recovery actions,
the Agency will also attempt to raise any remaining claims
under CERCLA section 106, to the extent practicable.
The remainder of this memorandum sets forth specific
policies for implementing these general principles.
Section II sets forth the management guidelines for negotiating
with less than all responsible parties for partial settlements.
This section reflects the Agency's willingness to be flexible
by considering offers for cleanup of less than 100% of cleanup
activities or costs.
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Section III sets forth guidelines on the release of
information. The Agency recognizes that adequate information
facilitates more successful negotiations. Thusf the Agency
will combine a vigorous program for obtaining the data and
information necessary to facilitate settlements with a program
for releasing information to facilitate communications among
responsible parties.
Sections IV and V discuss the criteria for evaluating
partial settlements. As noted above, in certain circumstances
the Agency will entertain settlement offers from PRPs which
extend only to part of the site or part of the costs of cleanup
at a site. Section IV of this memo sets forth criteria to be
used in evaluating such offers. These criteria apply to all
cases. Section V sets forth the Agency's policy concerning
offers to perform or pay for discrete phases of an approved
cleanup.
Sections VI and VII relate to contribution protection and
releases from liability. Where appropriate, the Agency may
consider contribution protection and limited releases from
liability to help provide some finality to settlements.
Section VIII sets forth criteria for selecting enforcement
cases and identifying targets for litigation. As discussed
above, effective enforcement depends on careful case selection
and the careful selection of targets for litigation. The Agency
will apply criteria for selection of cases to focus sufficient
resources on cases that provide the broadest possible enforcement
impact. In addition, targets for litigation will be identified
in light of the willingness of parties to perform voluntary
cleanup, as well as conventional litigation management concerns.
Section IX sets forth the requirements governing the timing
of negotiations and section X the provisions for Headquarters
review. These sections address the need to provide the Regions
with increased flexibility in negotiations and to change Headquarters
review in order to expedite site cleanup.
II. Management Guidelines for Negotiation
As a guideline, the Agency will negotiate only if the
initial offer from PRPs constitutes a substantial proportion of
the costs of cleanup at the site, or a substantial portion of
the needed remedial action. Entering into discussions for less
than a substantial proportion of cleanup costs or remedial action
needed at the site, would not be an effective use of government
resources. No specific numerical threshold for initiating
negotiations has been established.
In deciding whether to start negotiations, the Regions
should weigh the potential resource demands for conducting
negotiations against the likelihood of getting 100% of costs
or a complete remedy.
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Where the Region proposes to negotiate for a partial
settlement involving less than the total costs of cleanup, or
a complete remedy, the Region should prepare as part of its
Case Negotiations Strategy a draft evaluation of the case
using the settlement criteria identified in section IV. The
draft should discuss how each of the factors in section IV
applies to the site in question, and explain why negotiations
for less than all of the cleanup costs, or a partial remedy,
are appropriate. A copy of the draft should be forwarded to
Headquarters. The Headquarters review will be used to identify
major issues of national significance or issues that may involve
significant legal precedents.
In certain other categories of cases, it may be appropriate
for the Regions to enter into negotiations with PRPs, even
though the offers from PRPs do not represent a substantial
portion of the costs of cleanup. These categories of cases
include:
0 administrative settlements of cost recovery actions
where total cleanup costs were less than $200,000;
0 claims in bankruptcy;
0 administrative settlements with de minimis contributors
of wastes.
Actions subject to this exception are administrative
settlements of cost recovery cases where all the work at the
site has been completed and all costs have been incurred. The
figure of $200,000 refers to all of the costs of cleanup. The
Agency is preparing more detailed guidance on the appropriate
form of such settlement agreements, and the types of conditions
that must be included.
Negotiation of claims in bankruptcy may involve both present
owners, where the United States may have an administrative costs
claim, and other parties such as past owners or generators,
where the United States may be an unsecured potential creditor.
The Regions should avoid becoming involved in bankruptcy proceedings
if there is little likelihood of recovery, and should recognize
the risks involved in negotiating without creditor status. It
may be appropriate to request DOJ filing of a proof of claim.
Further guidance is provided in the Memorandum from Courtney
Price entitled "Information Regarding CERCLA Enforcement Against
Bankrupt Parties," dated May 2.4, 1984.
In negotiating with d£ roinimis parties, the Regions should
limit their efforts to low volume, low toxicity disposers who
would not normally make a significant contribution to the costs
of cleanup in any case.
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In considering settlement offers from de minimis contributors,
the Region should normally focus on achieving cash settlements.
Regions should generally not enter into negotiations for full
administrative or judicial settlements with releases, contribution
protection, or other protective clauses. Substantial resources
should not be invested in negotiations with de minimis contributors,
in light of the limited costs that may be recovered, the time
needed to prepare the necessary legal documents, the need for
Headquarters review, potential res judicata effects, and other
effects that de minimis settlements may have on the nature of
the case remaining to the Government.
Partial settlements may also be considered in situations
where the unwillingness of a relatively small group of parties
to settle prevents the development of a proposal for a substantial
portion of costs or the remedy. Proposals for settlement in
these circumstances should be assessed under the criteria set
forth in section IV.
Earlier versions of this policy included a threshold for
negotiations, which provided that negotiations should not be
commenced unless an offer was made to settle for at least 80%
of the costs of cleanup, or of the remedial action. This
threshold has been eliminated from the final version of this
policy. It must be emphasized that elimination of this threshold
does not mean that the Agency is therefore more willing to
accept offers for partial settlement. The objective of the
Agency is still to obtain complete cleanup by PRPs, or 100% of
the costs of cleanup
III. Release of Information
The Agency will release information concerning the site
to PRPs to facilitate discussions for settlement among PRPs.
This information will include:
- identity of notice letter recipients;
- volume and nature of wastes to the extent identified as
sent to the site;
- ranking by volume of material sent to the site, if available.
In determining the type of information to be released,
the Region should consider the possible impacts on any potential
litigation. The Regions should take steps to assure protection
of confidential and deliberative materials. The Agency will
generally not release actual evidentiary material. The Region
should state on each released summary that it is preliminary,
that it was furnished in the course of compromise negotiations
(Fed. Rules of Evidence 408), and that it is not binding on
the Federal Government.
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This information release should be preceded by and combined
with a vigorous program for collecting information from responsible
parties. It remains standard practice for the Agency to use
the information gathering authorities of RCRA and CERCLA with
respect to all PRPs at a site. This information release should
generally be conditioned on a reciprocal release of information
by PRPs. The information request need not be simultaneous, but
EPA should receive the information within a reasonable time.
IV. Settlement Criteria
The objective of negotiations is to collect 100% of cleanup
costs or complete cleanup from responsible parties. The Agency
recognizes that, in narrowly limited circumstances, exceptions
to this goal may be appropriate, and has established criteria
for determining where such exceptions are allowed. Although
the Agency will consider offers of less than 100% in accordance
with this policy, it will do so in light of the Agency's position,
reinforced by recent court decisions, that PRP liability is
strict, joint and several unless it can be shown by the PRPs
that injury at a site is clearly divisible.
Based on a full evaluation of the facts and a comprehensive
analysis of all of the listed criteria, the Agency may consider
accepting offers of less than 100 percent. Rapid and effective
settlement depends on a thorough evaluation, and an aggressive
information collection program is necessary to prepare effective
evaluations. Proposals for less than total settlement should
be assessed using the criteria identified below.
1. Volume of wastes contributed to site by each PRP
Information concerning the volume of wastes contributed
to the site by PRPs should be collected, if available, and
evaluated in each case. The volume of wastes is not the only
criterion to be considered, nor may it be the most important.
A small quantity of waste may cost proportionately more to
contain or remove than a larger quantity of a different waste.
However, the volume of waste may contribute significantly and
directly to the distribution of contamination on the surface
and subsurface (including groundwater), and to the complexity
of removal of the contamination. In addition, if the properties
of all wastes at the site are relatively equal, the volume of
wastes contributed by the PRPs provides a convenient, easily
applied criterion for measuring whether a PRP's settlement
offer may be reasonable.
This does not mean, however, that PRPs will be required to
pay only their proportionate share based on volume of contribution
of wastes to the site. At many sites, there will be wastes
for which PRPs cannot be identified. If identified, PRPs may
be unable to provide funds for cleanup. Private party funding
for cleanup of those wastes would, therefore, not be available
if volumetric contribution were the only criteria.
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Therefore, to achieve the Agency's goal of obtaining 100
percent of cleanup or the cost of cleanup, it will be necessary
in many cases to require a settlement contribution greater than
the percentage of wastes contributed by each PRP to the site.
These costs can be obtained through the application of the theory
of joint and several liability where the harm is indivisible,
and through application of these criteria in evaluating settlement
proposals.
2. Nature of the wastes contributed
The human, animal and environmental toxicity of the hazardous
substances contributed by the PRPs, its mobility, persistence
and other properties are important factors to consider. As
noted above, a small amount of wastes, or a highly mobile waste,
may cost more to clean up, dispose, or treat than less toxic or
relatively immobile wastes. In addition, any disproportionate
adverse effects on the environment by the presence of wastes
contributed by those PRPs should be considered.
If a waste contributed by one or more of the parties offering
a settlement disproportionately increases the costs of cleanup
at the site, it may be appropriate for parties contributing such
waste to bear a larger percentage of cleanup costs than would be
the case by using solely a volumetric basis.
3. Strength of evidence tracing the wastes at the site to the
settling parties
The quality and quantity of the Government's evidence
connecting PRPs to the wastes at the site obviously affects
the settlement value of the Government's case. The Government
must show, by a preponderunce of the evidence, that the PRPs
are connected with the wastes in one or more of the ways provided
in Section 107 of CCRCLA. Therefore, if the Government's
evidence against a particular PRP is weak, we should weigh
that weakness in evaluating a settlement offer from that PRP.
On the other hand, where indivisible harm is shown to
exist, under the theory of joint and several liability the
Government is in a position to collect 100 % of the cost
of cleanup from all parties who have contributed to a site.
Therefore, where the quality and quantity of the Government's
evidence appears to be strong for establishing the PRP's
liability, the Government should rely on the strength of its
evidence and not decrease the settlement value of its case.
Discharging such PRPs from liability in a partial settlement
without obtaining a substantial contribution may leave the
Government with non-settling parties whose involvement at the
site may be more tenuous.
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In any evaluation of a settlement offer, the Agency
should weigh the amount of information exchange that has
occurred before the settlement offer. The more the Government
knows about the evidence it has to connect the settling parties
to the site, the better this evaluation will be. The information
collection provisions of RCRA and/or CERCLA should be used to
develop evidence prior to preparation of the evaluation.
4. Ability of the settling parties to pay
Ability to pay is not a defense to an action by the Government
Nevertheless, the evaluation of a settlement proposal should
discuss the financial condition of that party, and the practical
results of pursuing a party for more than the Government can
hope to actually recover. In cost recovery actions it will be
difficult to negotiate a settlement for more than a party's
assets. The Region should also consider allowing the party to
reimburse the Fund in reasonable installments over a period of
time, if the party is unable to pay in a lump sum, and install-
ment payments would benefit the Government. A structured
settlement providing for payments over time should be at a
payment level that takes into account the party's cash flow.
An excessive amount could force a party into bankruptcy, which
will of course make collection very difficult. See the memorandum
dated August 26, 1983, entitled "Cost Recovery Actions under
Section 107 of CERCLA" for additional guidance on this subject.
5. Litigative risks in proceeding to trial
Litigative risks which might be encountered at trial and
which should weigh in consideration of any settlement offer
include traditional factors such as:
a. Admissibility of the Government's evidence
If necessary Government evidence is unlikely to be admitted
in a trial because of procedural or substantive problems in the
acquisition or creation of the evidence, this infirmity should
be considered as reducing the Government's chance of success
and, therefore, reducing the amount the Government should
expect to receive in a settlement.
b. Adequacy of the Government's evidence
Certain aspects of this point have already been discussed
above. However, it deserves mention again because the
the Government's case depends on substantial quantities
of sampling, analytical and other technical data and expert
testimony. If the evidence in support of the Government's
case is incomplete or based upon controversial science, or if
the Government's evidence is otherwise unlikely to withstand
the scrutiny of a trial, the amount that the Government might
expect to receive in a settlement will be reduced.
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c. Availability of defenses
\
In the unlikely event that one or more of the settling parties
appears to have a defense to the Government's action under section
107(b) of CERCLA, the Government should expect to receive less in
a settlement from that PRP. Availability of one or more defenses
to one PRP which are not common to all PRPs in the case should
not, however, lower the expectation of what an entire offering
group should pay.
6. Public interest considerations
The purpose of site cleanup is to protect public health
and the environment. Therefore, in analyzing a settlement proposal
the timing of the cleanup and the ability of the Government to
clean up the site should be considered. For example, if the State
cannot fund its portion of a Fund-financed cleanup, a private-party
cleanup proposal may be given more favorable consideration than
one received in a case where the State .can't-fund its portion of
cleanup costs, if necessary.
Public interest considerations also include the availability
of Federal funds for necessary cleanup, and whether privately
financed action can begin more quickly than Federally-financed
activity. Public interest concerns may be used to justify
a settlement of less than 100% only when there is a demonstrated
need for a quick remedy to protect public health or the environment.
7. Precedential value
In some cases, the factual situation may be conducive to
establishing a favorable precedent for future Government actions.
For example, strong case law can be developed in cases of first
impression. In addition, settlements in such cases tend to
become precedents in themselves, and are examined extensively by
PRPs in other cases. Settlement of such cases should always be
on terms most favorable to the Government. Where PRPs will not
settle on such terms, and the quality and quantity of evidence
is strong, it may be in the overall interest of the Government
to try t:he case.
8. Value of obtaining a present sum certain
If money can be obtained now and turned over to the Fund,
where it can earn interest until the time it is spent to clean
up a site, the net present value of obtaining the sum offered
in settlement now can be computed against the possibility of
obtaining a larger sum in the future. This calculation may show
that the net present value of the sum offered in settlement is, in
reality, higher than the amount the Government can expect to obtain
at trial. EPA has developed an economic model to assess these and
other related economic factors. More information on this model
can be obtained from the Director, Office of Waste Programs Enforcement,
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9. Inequities and aggravating factors
All analyses of settlement proposals should flag for the
decision makers any apparent inequities to the settling parties
inherent in the Government's case, any apparent inequities to
others if the settlement proposal is accepted, and any aggravating
factors. However, it must be understood that the statute
operates on the underlying principle of strict liability, and
that equitable matters are not defenses.
10. Nature of the case that remains after settlement
All settlement evaluations should address the nature of
the case that remains if the settlement is accepted. For
example, if there are no financially viable parties left to
proceed against for the balance of the cleanup after the
settlement, the settlement offer should constitute everything
the Government expects to obtain at that site. The questions
are: What does the Government gain by settling this portion
of the case? Does the settlement or its terms harm the remaining
portion of the case? Will the Government have to expend the
same amount of resources to try the remaining portion of the
case? If so, why should the settlement offer be accepted?
This analysis is extremely important and should come at
the conclusion of the evaluation.
V. Partial Cleanups
On occasion, PRPs may offer to perform or pay for one
phase of a site cleanup (such as a surface removal action) but
not commit to any other phase of the cleanup (such as ground
water treatment). In some circumstances, it may be appropriate
to enter into settlements for such partial cleanups, rather
than to resolve all issues in one settlement. For example, in
some cases it is necessary to conduct initial phases of site
cleanup in order to gather sufficient data to evaluate the
need for and type of work to be done on subsequent phases. In
such cases, offers from PRPs to conduct or pay for less than
all phases of site cleanup should be evaluated in the same
manner and by the same criteria as set forth above. Settlements
must be limited to the phase or phases of work actually to be
performed at the site. This provision does not cover preparation
of an RI/FS, which is covered by a separate guidance document:
Lee Thomas and Courtney Price's "Participation of Potentially
Responsible Parties in RI/FS Development" (March 20, 1984).
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VI. Contribution Protection
Contribution among responsible parties is based on the
principle that a jointly and severally liable party who has
paid all or a portion of a judgment or settlement may be entitled
to reimbursement from other jointly or severally liable parties.
When the Agency reaches a partial settlement with some parties,
it will frequently pursue an enforcement action against non-settling
responsible parties to recover the remaining costs of cleanup.
If such an action is undertaken, there is a possibility that
those non-settlors would in turn sue settling parties. If this
action by nonsettling parties is successful, then the settling
parties would end up paying a larger share of cleanup costs
than was determined in the Agency's settlement. This is obviously
a disincentive to settlement.
Contribution protection in a consent decree can prevent
this outcome. In a contribution protection clause, the United
States would agree to reduce its judgment against the non-settling
parties, to the extent necessary to extinguish the settling
party's liability to the nonsettling third party.
The Agency recognizes the value of contribution protection
in limited situations in order to provide some measure of
finality to settlements. Fundamentally, we believe that settling
parties are protected from contribution actions as a matter of
law, based on the Uniform Contribution Among Tortfeasors Act.
That Act provides that, where settlements are entered into in
"good faith", the settlors are discharged from "all liability
for contribution to any other joint tortfeasors." To the extent
that this law is adopted as the Federal rule of decision,
there will be no need for specific clauses in consent agreements
to provide contribution protection.
There has not yet been any ruling on the issue. Thus,
the Agency may still be asked to provide contribution protection
in the form of offsets and reductions in judgment. In determining
whether explicit contribution protection clauses are appropriate,
the Region should consider the following factors:
e Explicit contribution protection clauses are generally not
appropriate unless liability can be clearly allocated, so
that the risk of reapportionment by a judge in any future
action would be minimal.
* Inclusion should depend on qase-by-case consideration of
the law which is likely to be applied.
• The Agency will be more willing to consider contribution
protection in settlements that provide substantially all
the costs of cleanup.
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If a proposed settlement includes a contribution protection
clause, the Region should prepare a detailed justification
indicating why this clause is essential to attaining an adequate
settlement. The justification should include an assessment of
the prospects of litigation regarding the clause. Any proposed
settlement that contains a contribution protection clause with
a potential ambiguity will be returned for further negotiation.
Any subsequent claims by settling parties against non-settlors
must be subordinated to Agency claims against these non-settling
parties. In no event will the Agency agree to defend on behalf
of a settlor, or to provide direct indemnification. The Government
will not enter into any form of contribution protection agreement
that could require the Government to pay money to anyone.
If litigation is commenced by non-settlors against settlors,
and the Agency became involved in such litigation, the Government
would argue to the court that in adjusting equities among responsible
parties, positive consideration should be given to those who came
forward voluntarily and were a part of a group of settling PRPs.
VII. Releases from Liability
Potentially responsible parties who offer to wholly or
partially clean up a site or pay the costs of cleanup normally
wish to negotiate a release from liability or a covenant not
to sue as a part of the consideration for that cleanup or
payment. Such releases are appropriate in some circumstances.
The need for finality in settlements must be balanced against
the need to insure that PRPs remain responsible for recurring
endangerments and unknown conditions.
The Agency recognizes the current state of scientific
uncertainty concerning the impacts of hazardous substances,
our ability to detect them, and the effectiveness of remedies
at hazardous waste sites. It is possible that remedial measures
will prove inadequate and lead to imminent and substantial
endangerments, because of unknown conditions or because of
failures in design, construction or effectiveness of the remedy.
Although the Agency approves all remedial actions for sites
on the National Priorities List, releases from liability will
not automatically be granted merely because the Agency has
approved the remedy. The willingness of the Agency to give
expansive releases from liability is directly related to the
confidence the Agency has that the remedy will ultimately
prove effective and reliable. In general, the Regions will
have the flexibility to negotiate releases that are relatively
expansive or relatively stringent, depending on the degree of
confidence that the Agency has in the remedy.
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Releases or covenants must also include certain reopeners
which preserve the right of the Government to seek additional
cleanup action and recover additional costs from responsible
parties in a number of circumstances. They are also subject
to a variety of other limitations. These reopener clauses and
limitations are described below.
In addition, the Agency can address future problems at a
site by enforcement of the decree or order, rather than by
action under a particular reopener clause. Settlements will
normally specify a particular type of remedial action to be
undertaken. That remedial action will normally be selected to
achieve a certain specified level of protection of public
health and the environment. When settlements are incorporated
into consent decrees or orders, the decrees or orders should
wherever possible include performance standards that set out
these specified levels of protection. Thus, the Agency will
retain its ability to assure cleanup by taking action to enforce
these decrees or orders when remedies fail to meet the specified
standards.
It is not possible to specify a precise hierarchy of
preferred remedies. The degree of confidence in a particular
remedy must be determined on an individual basis, taking site-
specific conditions into account. In general, however, the
more effective and reliable the remedy, the more likely it is
that the Agency can negotiate a more expansive release. For
example, if a consent decree or order commits a private party
to meeting and/or continuing to attain health based performance
standards, there can be great certainty on the part of the
Agency that an adequate level of public health protection will
be met and maintained, as long as the terms of the agreement
are met. In this type of case, it may be appropriate to negotiate
a more expansive release than, for example, cases involving
remedies that are solely technology-based.
Expansive releases may be more appropriate where the private
party remedy is a demonstrated effective alternative to land
disposal, such as incineration. Such releases are possible
whether the hazardous material is transported offsite for
treatment, or the treatment takes place on site. In either
instance, the use of treatment can result in greater certainty
that future problems will not occur.
Other remedies may be less appropriate for expansive
releases, particularly if the consent order or agreement does
not include performance standards. It may be appropriate in
such circumstances to negotiate releases that become effective
several years after completion of the remedial action, so that
the effectiveness and reliability of the technology can be
clearly demonstrated. The Agency anticipates that responsible
parties may be able to achieve a greater degree of certainty
in settlements when the state of scientific understanding
concerning these technical issues has advanced.
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Regardless of the relative expansiveness or stringency of
the release in other respects, at a minimum settlement documents
must include reopeners allowing the Government to modify terms
and conditions of the agreement for the following types of
circumstances:
• where previously unknown or undetected conditions that
arise or are discovered at the site after the time of
the agreement may present an imminent and substantial
endangerment to public health, welfare or the
environment;
0 where the Agency receives additional information, which
was not available at the time of the agreement, concerning
the scientific determinations on which the settlement
was premised (for example, health effects associated
with levels of exposure, toxicity of hazardous substances,
and the appropriateness of the remedial technologies
for conditions at the site) and this additional information
indicates that site conditions may present an imminent
and substantial endangerment to the public health or
welfare or the environment.
In addition, release clauses must not preclude the Government
from recovering costs incurred in responding to the types of
imminent and substantial endangerments identified above.
In extraordinary circumstances, it may be clear after
application of the settlement criteria set out in section IV
that it is in the public interest to agree to a more limited
or more expansive release not subject to the conditions outlined
above. Concurrence of the Assistant Administrators for OSWER
and OECM (and the Assistant Attorney General when the release
is given on behalf of the United States) must be obtained
before the Government's negotiating team is authorized to
negotiate regarding such a release or covenant.
The extent of releases should be the same, whether the
private parties conduct the cleanup themselves or pay for
Federal Government cleanup. When responsible parties pay for
Federal Government cleanup, the release will ordinarily not
become effective until cleanup is completed and the actual
costs of the cleanup are ascertained. Responsible parties
will thereby bear the risk of uncertainties arising during
execution of the cleanup. In limited circumstances, the
release may become effective upon payment for Federal Government
cleanup, if the payment includes a carefully calculated premium
or other financial instrument that adequately insures the
Federal government against these uncertainties. Finally, the
Agency may be more willing to settle for less than the total
costs of cleanup when it is not precluded by a release clause
from eventually recovering any additional costs that might
ultimately be incurred at a site.
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Release clauses are also subject to the following limitations:
0 A release or covenant may be given only to the PRP providing
the consideration for the release.
0 The release or covenant must not cover any claims other
than those involved in the case.
0 The release must not address any criminal matter.
0 Releases for partial cleanups that do not extend to the
entire site must be limited to the work actually completed.
0 Federal claims for natural resource damages should not be
released without the approval of Federal trustees.
0 Responsible parties must release any related claims against the
United States, including the Hazardous Substances Response Fund.
0 Where the cleanup is to be performed by the PRPs, the release
or covenant should normally become effective only upon the
completion of the cleanup (or phase of cleanup) in a manner
satisfactory to EPA.
0 Release clauses should be drafted as covenants not to sue,
rather than releases from liability, where this form may be
necessary to protect the legal rights of the Federal Government.
A release or covenant not to sue terminates or seriously
impairs the Government's rights of action against PRPs. Therefore,
the document should be carefully worded so that the intent of the
parties and extent of the matters covered by the release or covenant
are clearly stated. Any proposed settlement containing a release
with a possible ambiguity will be returned for further negotiation.
VIII. Targets for Litigation
The Regions should identify particular cases for referral
in light of the following factors:
- substantial environmental problems exist;
- the Agency's case has legal merit;
- the amount of money or cleanup involved is significant;
- good legal precedent is possible (cases should be rejected
where the potential for adverse precedent is substantial);
- the evidence is strong, well developed, or capable of
development;
- statute of limitations problems exist;
- responsible parties are financially viable.
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The goal of the Agency is to bring enforcement action
wherever needed to assure private party cleanup or to recover
costs. The following types of cases are the highest priorities
for referrals:
- 107 actions in which all costs have been incurred;
- combined 106/107 actions in which a significant phase has
been completed, additional injunctive relief is needed and
identified, and the Fund will not be used;
- 106 actions which will not be the subject of Fund-financed
cleanup.
Referrals for injunctive relief may also be appropriate
in cases when it is possible that Fund-financed cleanup will
be undertaken. Such referrals may be needed where there are
potential statute of limitation concerns, or where the site
has been identified as enforcement-lead, and prospects for
successful litigation are good.
Regional offices should periodically reevaluate current
targets for referral to determine if they meet the guidelines
identified above.
As indicated before, under the.theory of joint and several
liability the Government is not required to bring enforcement
action against all of the potentially responsible parties
involved at a site. The primary concern of the Government in
identifying targets for litigation is to bring a meritorious
case against responsible parties who have the ability to under-
take or pay for response action. The Government will determine
the targets of litigation in order to reach the largest manageable
number of parties, based on toxicity and volume, and financial
viability. Owners and operators will generally be the target
of litigation, unless bankrupt or otherwise judgment proof.
In appropriate cases, the Government will consider prosecuting
claims in bankruptcy. The Government may also select targets
for litigation for limited purposes, such as site access.
Parties who are targeted for litigation are of course not
precluded from involving parties who have not been targeted in
developing settlement offers for consideration by the Government.
In determining the appropriate targets for litigation, the
Government will consider the willingness of parties to settle,
as demonstrated in the negotiation stage. In identifying a
manageable number of parties for litigation, the Agency will
consider the recalcitrance or willingness to settle of the
parties who were involved in the negotiations. The Agency
will also consider other aggravating and mitigating factors
concerning responsible party actions in identifying targets
for litigation.
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In addition, it may be appropriate, when the Agency is
conducting phased cleanup and has reached a settlement for one
phase, to first sue only non-settling companies for the next
phase, assuming that such financially viable parties are available.
This approach would not preclude suit against settling parties,
but non-settlors would be sued initially.
The Agency recognizes that Federal agencies may be responsible
for cleanup costs at hazardous waste sites. Accordingly, Federal
facilities will be issued notice letters and administrative orders
where appropriate. Instead of litigation, the Agency will use
the procedures established by Executive Orders 12088 and 12146
and all applicable Memoranda of Understanding to resolve issues
concerning such agency's liability. The Agency will take all
steps necessary to encourage successful negotiations.
IX. Timing of Negotiations
Under our revised policy on responsible party participation
in RI/FS, PRPs have increased opportunities for involvement in
the development of the remedial investigations and feasibility
studies which the Agency uses to identify the appropriate remedy.
In light of the fact that PRPs will have received notice
letters and the information identified in section III of this
policy, prelitigation negotiations can be conducted in an
expeditious fashion.
The Negotiations Decision Document (NDD), which follows
completion of the RI/FS, makes the preliminary identification of
the appropriate remedy for the site. Prelitigation negotiations
between the Government and the PRPs should normally not extend
for more than 60 days after approval of the NDD. If significant
progress is not made within a reasonable amount of time, the
Agency will not hesitate to abandon negotiations and proceed
immediately with administrative action or litigation. It should
be noted that these steps do not preclude further negotiations.
Extensions can be considered in complex cases where there is
no threat of seriously delaying cleanup action. Any extension of
this period must be predicated on having a good faith offer from
the PRPs which, if successfully negotiated, will save the Government
substantial time and resources in attaining the cleanup objectives.
X. Management and Review of Settlement Negotiations
All settlement documents must receive concurrence from OWPE
and OECM-Waste, and be approved by the Assistant Administrator
of OECN in accordance with delegations. The management guideline
discussed in Section II allows the Regions to commence negotiations
if responsible parties make an initial offer for a substantial
proportion of the cleanup costs. Before commencing negotiations
for partial settlements, the Regions should prepare a preliminary
draft evaluation of the case using the settlement criteria in
section IV of this policy. A copy of this evaluation should
be forwarded to Headquarters.
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A final detailed evaluation of settlements is required
when the Regions request Headquarters approval of these
settlements. This written evaluation should be submitted to
OECM-Waste and OWPE by the legal and technical personnel on
the case. These will normally be the Regional attorney and
technical representative.
The evaluation memorandum should indicate whether the
settlement is for 100% of the work or cleanup costs. If this
figure is less than 100%, the memorandum should include a
discussion of the advantages and disadvantages of the proposed
settlement as measured by the criteria in section IV. The
Agency expects full evaluations of each of the criteria specified
in the policy and will return inadequate evaluations.
The Regions are authorized to conclude settlements in certain
types of hazardous waste cases on their own, without prior
review by Headquarters or DOJ. Cases selected for this treatment
would normally have lower priority for litigation. Categories
of cases not subject to Headquarters review include negotiation
for cost recovery cases under $200,000, and negotiation of
claims filed in bankruptcy. In cost recovery cases, the Regions
should pay particular attention to weighing the resources
necessary to conduct negotiations and litigation against the
amounts that may be recovered, and the prospects for recovery.
Authority to appear and try cases before the Bankruptcy
Court would not be delegated to the Regions, but would be
retained by the Department of Justice. The Department will
file cases where an acceptable negotiated settlement cannot be
reached. Copies of settlement documents for such agreements
should be provided to OWPE and OECM.
Specific details concerning these authorizations will be
addressed in delegations that will be forwarded to the Regions
under separate cover. Headquarters is conducting an evaluation
of the effectiveness of existing delegations, and is assessing
the possibility of additional delegations.
Note on Purpose and Uses of this Memorandum
The policies and procedures set forth here, and internal
Government procedures adopted to implement these policies, are
intended as guidance to Agency and other Government employees.
They do not constitute rulemaking by the Agency, and may not be
relied on to create a substantive or procedural right or benefit
enforceable by any other person. The Government may take action
that is at variance with the policies and procedures in this
memorandum.
If you have any questions or comments on this policy, or
problems that need to be addressed in further guidance to
implement this policy, please contact Gene A. Lucero, Director
of the Office of Waste Programs Enforcement, (FTS 382-4814), or
Richard Mays, Senior Enforcement Counsel, (FTS 382-4137).
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. O.C. 20460
JAN23B85 ofF,CEOf
SOLID WASTE AND EMERGENCY RESPONSE
MEMORANDUM
SUBJECT: Funding of State Enforcement-Related Activities
FROM: Gene A. Lucero, Director r>0M ft-
Office of Waste Programs Enforcement
TO: Waste Management Division Directors
Regions I-X
The Office of General Counsel recently concluded that
CERCLA funding may be provided to States to support various
enforcement-related activities in addition to State-conducted
remedial investigations and feasibility studies at State-lead
enforcement sites. These activities are: (1) oversight of
RI/FSs and remedial designs prepared by potentially responsible
parties at State-lead enforcement sites; (2) management assist-
ance for RI/FS/RDs conducted by PRPs at EPA-lead enforcement
sites; and (3) management assistance for RI/FS/RDs 'conducted by
Federal agencies at Federal facilities. The rationale is that
such activities are part of the remedial planning process and
consequently are eligible for CERCLA funding.
For State-lead sites/ the funding will allow us to better
ensure a high level of quality and consistency in site evaluation
and remedy-selection by States. It will also make more practi-
cable the provision in the October 2, 1984, State relations .
policy that requires States to commit to "prepare, or have the
responsible party prepare, an RI/FS ... in accordance with
EPA guidance" in order for an enforcement site to be finally
classified as State-lead. For EPA-lead enforcement sites and
Federal facilities, the funding will better enable States to
review and comment on documents generated during the RI/FS/RD
process.
We are now looking for funding sources for these purposes.
As you know, proposed uses of current fiscal year funds exceed
what is available. In the interim, however, you may consider
using some portion of RI/FS funds freed by settlement where the
PRPs agree to conduct the RI/FS, and other enforcement funds
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available to you that have not been obligated. In each
instance, the concurrence of the CERCLA Enforcement Division
Director must be obtained and the SCAP formally amended before
proceeding.
Funding of these activities will be through a new or
amended site-specific or multi-site cooperative agreement. V7e
will be developing guidance over the next several months to
provide detail on eligible activities, costs, and procedures.
In the interim, however, the following general activities
should be considered eligible for funding:
(1) Review, and for State-lead enforcement sites approval,
of the proposed work plan, quality control plan, safety
plan, and other documents related to the RI/FS;
(2) On-site time during critical points in the remedial
investigation at State-lead enforcement sites (e.g.,
during drilling and sampling);
(3) Review of preliminary data during the RI/FS, and
other interim reports;
(4) Review of the draft and final RI/FS;
(5) Community relations during, and a public comment
period upon the conclusion of, the RI/FS. at State
enforcement-lead sites; and"
(6) Review, and for State-lead enforcement sites approval,
of the remedial design.
Since this funding assistance is a new activity, Regional
enforcement and program personnel should work closely together,
and with the Regional Coordinator in the CERCLA Compliance
Branch and.the zone manager 'in the State and Regional Coordina-
tion Branch (SRCB) in OERR. In addition, pending development of
more detailed information and procedures that will be incorporated
in the State Participation Manual, drafts of new cooperative
agreements or amendments should be submitted to Headquarters for
review. The drafts should be sent to the Regional Coordinator
in the CERCLA Division Compliance Branch who will coordinate
the review with SRCB. This review is necessary in the near term
to ensure consistency in determining the appropriateness of
proposed State costs associated with the above activities. We
are not at this point establishing a minimum or maximum amount
that will be allowed, although the 10% figure for estimating
EPA oversight costs, and the 2% to 4% figure for management
assistance may be used as a general guide. Once the guidance
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is issued. Regions will be able to develop and approve these
cooperative agreements or amendments subject only to advance
notification, to the Compliance Branch, and to the concurrence
of the CERCLA Enforcement Division Director where funds, are to
come from monies previously targeted for other purposes in the
SCAP.
If you have any questions concerning funding for these
agreements, please contact Barbara Elkus at FTS 1382-4819. For
other implementation Questions, please contact Andy Caraker at
FTS 382-4808.
cc: William N. Hedeman, OERR
Sam Morekas, SRCB
Susan Bullard, OSWER
Fred Stiehl, OECM
Regional Counsel, Regions I-X
Superfund Branch Chief, Regions I-X
Superfund Enforcement Branch/Section Chief, Regions I-X
David Buente, Department of Justice
Sue Moreland, Association of State and Territorial
Solid Waste Management Officials
Norm Nosenchuck, Chair, ASTSWMO Superfund Committee
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. D.C. 20460
MAR 22 1985
OFFICE OF
SOLID WASTE AND EMERGENCY RESPONSE
MEMORANDUM
SUBJECT: Community Relations Activities at Superfund
vfjhforej&merft Sites — Interim Guidance
IcMl'JL.
FROM: jack W4 McGraw
KCting Assistant Administrator
TO: Regional Administrators
Attached is the interim guidance for conducting community
relations activities at Superfund enforcement sites. The
guidance is in the form of Chapter VI that will be added to the
September 1983 document. entitled "Community Relations in Super-
fund: A Handbook," which contains Chapters I through V. The
Handbook is being revised to reflect experience with the
community relations program to date. Based on experience to be
gained over the next several months, the enforcement chapter
will be revised as necessary and issued as final guidance early
in 1986 as part of the overall Handbook revisions.
The chapter has been developed in coordination with inter-
ested offices within EPA and with the Department of Justice. It
represents a carefully constructed consensus as to how to enable
an extensive community relations program in the course of enforce-
ment actions while at the same time preserving the integrity of
the enforcement process. Because of the complexity and differing
circumstances involved in enforcement actions, the chapter cannot
address every situation that will arise; it does, however, provide
a sound structure for determining the nature and scope of site-
specific community relations activities. A particularly important
emphasis is placed on consultation among Regional community rela-
tions, technical enforcement, and Regional Counsel staff, and
between these staff and Department of Justice personnel once a
case has been referred, or is likely to be referred, for litiga-
tion. This consultation is key to successful implementation of
the chapter.
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The chapter is applicable to all Superfund enforcement
actions. However/ it is not retroactively applicable; that is,
current enforcement actions should not be delayed in order to
implement community relations activities that would have 'been
appropriate at some earlier point in the enforcement process .had
the chapter been in effect. The provisions of the chapter should
be applied as appropriate to ongoing enforcement actions from
the date of your receipt of the chapter.
A workshop to explain the chapter is being developed by a
Headquarters/Region/Department of Justice work group. The half-
day workshops, will begin within approximately one month, and will
be offered in each Region. It will be important for all Regional
personnel involved in Superfund enforcement to attend. Conse-
quently, I ask that you make staff participation a priority. We
will apprise you of the schedule once it has been developed.
Attachment
cc: Regional Counsels
Hazardous Waste Management Division Directors
Superfund Branch Chiefs
Superfund Enforcement Branch/Section Chiefs
Superfund Community Relations Coordinators
308
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CHAPTER 6
COMMUNITY RELATIONS DURING ENFORCEMENT ACTIONS
An effective community relations proqram is an essential part
of every Superfund enforcement action. This chapter provides
guidelines for developing and administering community relations
programs during enforcement proceedings brought under the authori-
!/
ties of CERCLA.
The purposes of community relations activities related to
Superfund actions, described in the preceding chapters, essentially
are to ensure that:
(1) community concerns are considered to the greatest extent
practicable in determining site remedies;
/
(2) affected citizens have an opportunity to participate
in the remedy-selection process, principally through review and
comment; and
(3) communities are kept informed during Agency actions.
I/ CERCLA and the National Contingency Plan, including require-
ments regarding community relations, apply to actions carried out
by a State where CERCLA funds are used to support the State
activity. As of the date of issuance of this chapter, no CERCLA
funds have been used to underwrite State costs where the State
has assumed lead enforcement responsibility for a site. Conse-
quently, there has been no basis in the past for requiring States
to conduct community relations activity at State enforcement-lead
sites. However, OSWER is planning to begin funding remedial
investigations and feasibility studies (RI/FS) at selected State-
lead enforcement sites, and may in the future be able to provide
a broader range of assistance. Accordingly, the appropriate
provisions of this chapter will apply to that aspect of State
activity at a State-lead enforcement site that is funded in whole
or in part by CERCLA monies.
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It must be recognized, however, that the enforcement process
is by its nature adversarial, even where there is an apparent
interest on the part of potentially responsible parties to work
willingly with the Agency to arrive at appropriate site cleanup.
In order for the government to protect its enforcement position,
both in court and during negotiations, there are necessary limi-
tations on the release or discussion of certain information.
For example, there can be no discussion of enforcement strategy
and timing, nor can there be release of information that might
disclose the strengths and weaknesses of a case or that is other-
wise privileged and protected under the law. In addition, depend-
ing upon specific circumstances, there may be other limitations
on the scope of community relations activities, particularly
where a case has been referred to the Department of Justice for
litigation.
The objective of this chapter is to establish a structure
that will allow communication between the Government and the
affected community in the course of enforcement actions, while
at the same time accommodating precautions that are necessary to
preserve the ability of the Agency to prosecute those enforcement.
actions on behalf of the public. Therefore, while community
relations activities for enforcement sites basically will be the
same as for Fund-lead sites, modifications probably will be
required at times to reflect the unique aspects of the enforcement
process. Because enforcement circumstances will vary at each
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site, this chapter .cannot address every situation that will
arise. Rather, the chapter provides a context within which
government staff, through sensitivity and careful judgment, can
strike a balance between the purposes of community relations
activities and the objectives of government enforcement actions.
The chapter begins with a summary of the Superfund enforce-
ment process (Section A). It then provides guidelines for con-
ducting community relations activities in the course of enforcement
actions. The preceding chapters of this handbook contain detailed
explanations of many of the activities described in this chapter.
The community relations activities in this chapter are des-
cribed within the context of various enforcement actions that may
or may not occur in the order of presentation. For example,
negotiations may be entered into with potentially responsible
parties regarding the desiqn and implementation of the RI/FS.
In this case, the provisions for community relations during
negotiations (Section F) also would apply in addition to those
described for the period prior to the RI/FS (Section C). The
ordering in the chapter is for convenience of explanation. The
sections following the summary of the enforcement process are:
0 Development of the community relations plan (Section B);
0 Community relations prior to the remedial investigation
and feasibility study (RI/FS) (Section C);
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0 Community relations during and upon completion of the
RI/FS (Section D) ?
* Potential public participation in technical discussions
with potentially responsible parties and government
representatives to discuss aspects of site remedy
(Section E);
0 Community relations during and upon completion of negotia-
tions with potentially responsible parties (Section F);
0 Community relations during and upon completion of liti-
gation (Section G);
0 Community relations during responsible party cleanup
(Section H); and
0 Community relations during removal actions (Section I).
A. THE ENFORCEMENT PROCESS
The enforcement process under CERCLA will vary with the
circumstances of each site. However, a description of the basic
approach is set forth here to help the reader follow the later
discussions in this chapter.
CERCLA section 104 authorizes the government to respond to
releases or threatened releases of hazardous substances, pollu-
tants, and contaminants, unless the government determines that
the responsible parties will respond in a timely and proper
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manner. EPA may seek to compel potentially responsible parties
through litiqation or administrative order to clean up hazardous
substances or to pay the costs of government response, or EPA
may negotiate and settle with potentially responsible parties
regarding cleanup and cleanup costs.
The enforcement process begins with a search for potentially
responsible parties associated with each site, including genera-
tors, transporters, and facility owners and operators. When
potentially responsible parties (PRPs) are identified, EPA eval-
uates their ability to undertake cleanup actions properly. Usually,
before the Agency begins its own response activities, EPA attempts
to send notice letters to the potentially responsible parties, in-
forming them of their potential liabilities, requesting information
under section 104(e) of CERCLA and section 3007 of the Resource
Conservation and Recovery Act (RCRA), and providing an opportunity
to meet with the Agency to discuss possible cleanup activities
that the PRPs might undertake. For example, PRPs may perform the
RI/FS if they agree to follow the work plan for the RI/FS developed
by EPA. (See the memorandum entitled "Participation of Potentially
Responsible Parties in Development of Remedial Investigations
and Feasibility Studies Under CERCLA, signed March 20, 1984, by
Lee M. Thomas, Assistant Administrator for Solid Waste and Emer-
gency Response, and Courtney M. Price, Assistant Administrator
for Enforcement and Compliance Monitoring.) Or, EPA may conduct
the RI/FS, then seek to compel or negotiate with potentially
responsible parties to design and construct the remedy.
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At many sites, however, a Fund-financed removal action or
RI/FS will be conducted before the final decision is made whether
or not to pursue enforcement actions. When the removal action or
RI/FS is completed, EPA may seek to secure responsible party fund-
ing and management of any later stages of the response through
issuance of an administrative order or filing of a lawsuit, both
of which may involve negotiations, or some combination of these
actions.
Where there are to be negotiations, a government negotiating
team is formed. The leader of the negotiating team (or the team's
designee) serves as a liaison between the negotiating team and
the Regional Superfund Community Relations Coordinator. The
negotiating team leader is responsible for keeping the Regional
Superfund Community Relations Coordinator apprised of the negotia-
tion schedule. The Regional Superfund Community Relations Coordi-
nator is responsible for advising the negotiating team on Superfund
community relations policy and for managing community relations
activities approved by the team.
If the negotiations — whether for the RI/FS or for site
cleanup — result in an agreement by responsible parties to carry
out the appropriate actions, as a general rule their consent is
obtained in writing through a consent decree issued by a court,
or through a consent administrative order issued by EPA. The
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execution of a proposed consent decree by responsible parties
and the government is followed by a public comment period of at
least 30 .days (see Sections F and G). The court may also hold a
hearing during this time, either in response to public comments
or on its own accord. After a judge approves the consent decree
(which may have been modified on the basis of comments), the
consent decree is made final and the remedial plan is implemented.
Although no formal comment period for a proposed consent adminis-
trative order is required by law, it is reguired as a matter of •
EPA policy (see Section F).
Where negotiations end without an agreement between EPA and
the responsible parties, EPA may then choose -among several courses
of action. The Agency may issue unilateral administrative orders
^
demanding that responsible parties take action, reguest that the
Department of Justice file a complaint in federal district court
against the responsible parties — if one previously has not
been filed — or clean up the site using Superfund Trust Fynd
monies and thereafter attempt to recover the costs of the response
from the responsible parties. In the latter instance, unless
responsible parties agree willingly to pay cost recovery claims,
EPA asks the Department of Justice to file a civil action against
the responsible parties pursuant to CERCLA section 107. Such
cost recovery efforts generally are conducted after a Fund-financed
response is completed.
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6-8
B. DEVELOPMENT OF THE COMMUNITY RELATIONS PLAN
It is important to the success of remedial enforcement actions
that the government know the concerns of the local community, and
that the community understand the enforcement process. By identi-
fying and communicating community concerns to enforcement and legal
staff, the Regional Superfund Community Relations Coordinator can
assist the agency in developing responses acceptable to local
residents. Furthermore, contacts with the local community may
yield important information about the site or potentially respon-
sible parties. Similarly,, the enforcement effort can be enhanced
where the community understands the enforcement process and the
differences between it and Fund-financed actions. Consequently,
the Regional community relations staff must conduct discussions
with the affected community, in the locale of the site, as soon
as possible after the site has been included for enforcement
action in the Superfund Comprehensive Accomplishments Plan (SCAP).
Community relations staff must consult with enforcement
staff prior to conducting the community discussions to determine
what is already known about the site, any special cautions that
should be observed in the course of the discussions, and whether
site circumstances make it appropriate for enforcement staff to
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participate. Further, where discussions with the affected" commu-
nity provide the Agency with information concerning site condi-
tions or potentially responsible parties, or other relevant
enforcement information, community relations staff must ensure
that this information is provided as soon as possible to enforce-
ment staff.
It also should be noted that circumstances at sites are con-
stantly changing, and the need for enforcement action may arise
suddenly in connection with a site where no enforcement action
had been foreseen. The enforcement staff should keep the commu-
nity relations staff advised of these changes.
Community relations plans for enforcement-lead remedial
action sites should be prepared as soon as possible following
the discussions with the affected community. The plan must make
provision for the following major activities, recognizing that
referral of the case to the Department of Justice for litigation
may occur at any point in the enforcement process and may require
the plan to be revised:
(1) public meetings and information dissemination prior to
and during the remedial investigation/feasibility study stage
(see Sections C and D);
(2) public comment on the RI/FS (see Section D);
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(3) preparation of a summary of public comments on the
RI/FS to accompany the draft negotiations decision document (see
Section D);
(4) potential public participation in technical discussions
with potentially responsible parties and government representa-
tives to discuss aspects of site remedy (see Section E);
(5) dissemination of information during negotiations (see
Section F);
(6) preparation of a responsiveness summary of public
comments on the RI/FS to accompany the Enforcement Decision Docu-
ment and the proposed administrative order on consent or proposed
consent decree (see Sections F and G)? and
(7) preparation of a summary of public comments on the
Enforcement Decision Document and the administrative order on
consent or consent decree (see Sections F and G).
In preparing the plan, community relations staff must consult
closely with Regional technical enforcement staff and the Office
of Regional Counsel. Consultation is necessary to ensure that the
scope and timing of community relations activities are consistent
with the likely thrust and schedule of enforcement actions. Before
the plan can be implemented, it must be approved by the chief
official in the Regional Office responsible for technical enforce-
ment and by the Office of Regional Counsel.
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As stated previously, litigation may occur at any point in the
enforcement process. Generally, a case is not referred to the
Department of Justice until after some administrative enforcement
effort has been made. Consequently, in most cases, the community
relations plan need not initially include specific provisions for
litigation, except for informing the public of the possibility of
litigation and for describing the litigation process and its poten-
tial effects on the scope of community relations activities. If
the site subsequently is referred for litigation, the plan will
need to be modified accordingly. In those rare instances where
referral for litigation is the .initial enforcement action (either
•
prior to the SCAP or in accordance with the SCAP), the community
relations plan initially must specify activities to be carried
out during the litigation.
Because constraints on what may be revealed publicly or dis-
cussed with the community often will be greater during litigation
than during administrative enforcement proceedings, plans developed
after referral, and modifications to plans already approved, must
be approved by the Department of Justice. Community relations
staff should consult with the Department of Justice staff attorney
in developing these plans or modifications.
Further, the plan should include provisions for a routine
process through which meetings of community relations staff, the
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site project manager, and technical enforcement and legal person-
nel are held to coordinate activities and review information to
be released. Because the scope of activity to be carried out
and the nature of information to be disclosed depend so greatly
upon particular circumstances, regular consultation with the
negotiating team/litigation team is essential to avoid activity
or release of information that might be detrimental to the enforce-
ment process.
There will be occasions where disagreement arises as to the
nature and extent of community relations activities to be carried
out. These disagreements may arise within EPA or between EPA and
the Department of Justice. In such cases, effort should be made
to resolve the difficulties at the organizational level at which
they occur. If resolution cannot be obtained at that level, then
the issue may be raised to succeeding levels of authority. This
may in some cases involve Agency Assistant Administrators
and/or equivalent Department of Justice officials, although it
should not be considered desirable or appropriate to seek such
officials' involvement except in unusual circumstances.
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In some instances it may be appropriate, at the sole
discretion of the Agency, for responsible parties to participate
in aspects of the community relations plan jointly with EPA.
For example, where the responsible party conducts the RI/FS, or
.has reached agreement with the Agency for site cleanup, or both,
the responsible party may wish to participate in public meetings
or in the preparation of fact sheets. It may also be appropriate,
at the sole discretion of the Agency, for the responsible party
to participate in implementing the plan during negotiations
where the responsible party is willingly working with the Agency
to come to agreement on site cleanup, although these occasions
may be few. However, the responsibility for development and
implementation of the plan must remain with EPA.
In most instances, the decision regarding responsible party
participation in the community relations plan will be made after
the plan has been developed. As a result, the plan will need to
be modified to reflect the EPA and responsible party roles and
responsibilities. Any modifications must be approved by the
technical enforcement and Regional Counsel offices and, once a
case has been referred, by the Department of Justice.
C. COMMUNITY RELATIONS PRIOR TO THE RI/FS
At the time notice letters are sent, EPA Regional community
relations staff should contact local officials and citizens who
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have expressed concern about site issues to inform them that
enforcement efforts have begun. Staff also should announce the
community relations activities planned to take place with regard
to the site. These actions should serve primarily to provide
information on EPA's understanding of the nature of problems at
the site and on EPA's general enforcement process. In discussing
the community relations activities planned for the site, community
relations staff should point out that some modification in planned
activities likely will be necessary if the site is referred for
litigation. The reasons should be explained to ensure public
understanding of the legitimate constraints that apply in such
circumstances.
In all cases, community relations staff must coordinate their
activities with technical enforcement and legal staff and the site
project manager to ensure that any releases of information are
reviewed and approved in advance.
D. COMMUNITY RELATIONS DURING AND UPON COMPLETION OF THE RI/FS
In general, if the case has not been referred to the Depart-
ment of Justice for litiaation, community relations activities
during the remedial investigation and the development of the
feasibility study for enforcement sites should be basically the
same as for Fund-lead sites. Activities for most sites should
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include one or more public meetings and additional informal meet-
ings with interested citizens to discuss site conditions and
alternative remedial actions under study, and to respond to
questions on these issues. These and other standard activities
conducted in connection with Fund-lead RI/FSs are appropriate
for most enforcement remedial action sites because responsible
party participation in the RI/FS, and in some instances actual
conduct of the RI/FS, are being encouraged as a matter of Aqency
policy. In other words, since the RI/FS process will not gener-
ally be closed to potentially responsible parties, there generally
should be no bar to full public disclosure and participation.
However, consistent with the Administrator's memorandum of
October 4, 1984, regarding release of draft data and reports,
data from the RI/FS should not be discussed or released until it
has been through quality assurance and quality control processes.
Further, there must not be any discussion of Agency preference
toward a particular remedy, the Agency's likely enforcement
strategy, or responsible party attitudes or positions.
If the site has been referred to the Department of Justice
for litigation during the PI/FS, there likely will be constraints
on the scope of community relations activities (see Section G).
Further, if Regional technical enforcement and Regional Counsel
personnel believe that there is a strong possibility that the site
may be referred for litigation to obtain private party site cleanup,
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some limitations also may have to be observed. For example,
under such circumstances public and informal meetings might he
restricted to providing only information on site conditions and
the status of the feasibility study, avoiding responding to tech-
nical questions or interpreting data. The purpose of this limi-
tation would be to prevent Agency officials or consultants from
being put on record in a way that might bind the Agency in liti-
gation before all data and information have been gathered.
Once the enforcement PI/PS is completed, it should be made
available for public review and comment in accordance with proce-
dures that apply to Fund-lead sites. The opportunity for review
and comment should include at least one public meeting to discuss
the RI/FS and to respond to Questions. (See Section G for limita-
tions that may be imposed in those instances where the site has
y
been referred to the Department of Justice for litigation.)
Upon completion of the comment period, a summary of comments
must be prepared to accompany the draft Negotiations Decision
Document (NDD). The NDD is a document that serves as the basis
2/ In certain cases, court-established deadlines may require some
adjustments in timing. For example, a court may reauire the
government to identify its selected remedy by a date certain, but
delays in the RI/FS may make it impossible to get community comments
before the deadline. If the deadline cannot be extended, then some
adjustment, such as shortening the comment period, will have to be
considered.
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for the Agency to determine the remedy to be sought with respon-
sible parties. (For details regarding the NDD and procedures for
its preparation and processing, see the policy memorandum entitled
"Preparation of Decision Documents for Approving Fund-financed
and Responsible Party Remedial Actions," signed February 27, 19R5,
by the Acting Assistant Administrator for Solid Waste and Emergency
Response.) Since the Negotiations Decision Document is enforcement
confidential, it is not subject to public review, and its contents
and recommendations may not be released without the approval of
the Assistant Administrator.
Community relations activities at this point should involve
advising the public that public comments are being taken into account
in the Agency's consideration of remedies, and that upon completion
of negotiations or litigation the public will have the additional
opportunity to comment on the proposed remedy (see Sections F and G
and the above-cited policy memorandum). Community relations staff
also should advise the community of the next anticipated steps in
the enforcement process and explain negotiation or litigation pro-
cedures (as appropriate to the site) through small group briefings,
fact sheets, or brief informational materials deposited in a
local information repository. As with other activities, community
relations staff should consult with and obtain the approval of
appropriate technical enforcement and Regional Counsel personnel
to ensure that enforcement or negotiation positions are not jeopar-
dized. Where the case has been referred for litigation, approval
from the Department of Justice also is necessary.
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E. PUBLIC PARTICIPATION IN TECHNICAL DISCUSSIONS WITH POTENTIALLY
RESPONSIBLE PARTIES AND GOVERNMENT REPRESENTATIVES REGARDING
ASPECTS OP SITE REMEDY
There may be occasions where affected citizens may make
valuable contributions to appropriate site remedy through partici-
pation in technical discussions with potentially responsible
parties and govermtient representatives. These discussions, which
would deal with technical issues, and not Questions of liability
or other issues not relating to remedy, would be conducted separ-
ately from, but contemporaneously with, government/responsible
party remedy negotiations. The purpose would be not only to
facilitate public understanding of the technical issues, but also
to better enable the government and responsible parties to
arrive at a remedy that accommodates public concerns.
In developing the community relations plan for an enforce-
ment site, consideration should be given to whether such dis-
cussions will be appropriate. In most instances, however, the
final decision cannot be made at this point because circumstances
that would make such discussions appropriate or inappropriate
will not be known. Therefore, the community relations plan should
address only the potential for such discussions, the conditions
under which they might take place, and the criteria for public
participation.
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The decision on public participation will be made by the
Regional Administrator upon the advice of the Regional Superfund
Community Relations Coordinator, the chief Regional Office
official responsible for technical enforcement, and the Regional
Counsel. Where the case has been referred for litigation or there
is a likelihood of litigation, the concurrence of the Department
of Justice also must be obtained. (With regard to public partici-
pation in technical discussions for sites that are already in
litigation, see Section G.) The following criteria should be
considered in making the decision:
(1) Has the interested public, including local government
bodies, been able to agree on its representatives (gen-
erally no more than three or four).;
(2) Does the interested public have technical representation
where the complexity of site issues reguires such repre-
sentation;
/
(3) Will public participation (a) facilitate understanding
of community concerns, and (b) contribute to timely
resolution of technical issues; and
(4) Are the potentially" responsible parties willing to
participate in such technical discussions.
F. COMMUNITY RELATIONS DURING AND UPON COMPLETION OF NEGOTIATIONS
The confidentiality of statements made during the course of
negotiations is a well-established principle of our legal system.
Its purpose is to promote a thorough and frank discussion of the
issues between the parties to attempt to resolve differences. It
covers not only limitations on what may be revealed publicly, but
also the understanding that offers and counter-offers made in the
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course of negotiations may not and will not be used by one party
against the other in any litigation that may follow. Responsible
parties may be unwilling to negotiate if they cannot openly dis-
cuss their differences because they fear public disclosure regard-
ing issues of liability and other sensitive issues which may
damage their potential litigation position or their standing with
the public. This expectation of confidentiality necessarily re-
stricts the type and amount of information that can be made public,
but it can frustrate citizens and community groups in their desire
to know that their interests are being represented and protected.
Some information may be provided to the public/ in many
instances, without causing harm. For example, the identities of
participants, dates of negotiation sessions, and other procedural
information generally may be made public. In addition, informa-
tion concerning technical issues and alternative renedies under
consideration also may be made public in many instances, so long
as the negotiation or litigation positions of the participants
are not. Other information should not be made public. For
example, the attitudes of the parties to the negotiations cannot
be revealed or discussed, nor can there be public speculation by
Agency representatives on the prospects for a successful outcome.
Community relations staff must consult with and obtain the approval
of appropriate technical enforcement and Regional Counsel personnel
before the release of any information regarding negotiations. If
the site is in litigation, or is likely to be referred for liti-
gation, approval of the Department of Justice also must be obtained
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If a negotiated settlement is reached, it will be embodied
in either a proposed adminstrative order on consent — to be
issued by EPA — or a proposed consent decree — to be issued by
a court — that will be made available for a public comment period
of at least 30 days unless special circumstances require a shorter
period. (Note: administrative orders for removals are to be
handled differently. See Section I.) If a consent decree is to
be issued, community relations should be handled as described in
Section G of this chapter.
For administrative orders, the consent order will contain
a stipulation that public comments may lead to modifications in
the order. Community relations staff should announce the con-
clusion of negotiations, the procedures for public comment-, and
/
the availability of the consent order and the Enforcement Decision
Document that will have been prepared by the Region and that is
the mechanism for Agency approval of the cleanup. (NOTE: In
accordance with the policy memorandum of February 27, 19R5,
referenced earlier, a responsiveness summary of public comments
on the RI/FS is to be prepared to accompany the Enforcement Deci-
sion Document and will be made available for public review as
part of the EDD.] The announcement should consist of at least a
public notice, a news release to local media, and a notice in the
local repository. The announcement also should explain where
copies of the settlement documents, order, EDD, and responsiveness
summary may be found (e.g., in the local repository), and where
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comments should be sent. In some cases, community relations staff
may want to provide personal notification to concerned and directly
affected citizens. Any meetin'gs or briefings planned regardina
the order also should be announced. Communications to the public
should focus on the technical provisions of the settlement agree-
ment; details of the negotiations, such as the behavior, attitudes,
or legal positions of responsible parties, any compromises incor-
porated in the settlement agreement, and evidence or attorney
work product material developed during negotiations, must remain
confidential.
After the close of the comment period, a summary of comments
must be prepared and sent to the appropriate Regional official,
who will recommend to the signing official either that the order
go into effect unchanged or that negotiations be reopened to
consider issues raised by the comments received. If agency
negotiators and responsible parties agree to make changes in the
order, the order may be modified. The order goes into effect
once it is accepted unchanged or modified and subseguently ao-
proved, except that aspects of an order not affected by potential
modifications may be implemented without delay.
G. COMMUNITY RELATIONS DURING AND UPON COMPLETION OF LITIGATION
A case may be referred to the "Department of Justice to initi-
ate litigation at any point in the enforcement process. When a
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case is referred, the needs for confidentialif.y and constraints
on the scope and nature of community relations activities become
greater. If litigation is initiated early in the enforcement
process, the community relations plan for the site may need to
be modified substantially. If it is initiated late in the process,
at the conclusion of unsuccessful negotiations for example, the
plan will require only an addition to accommodate the litigative
process.
Where a case has been referred to the Department of Justice,
community relations staff and Agency enforcement and legal person-
nel must consult with the lead Department of Justice attorney to
determine the scope of community relations activities to be
carried ou't. While strong consideration should be given to imple-
menting the plan as developed arid previously approved, the federal
litigation process may reguire changes in the degree of public
disclosure. For example, the court of jurisdiction may have
rules regarding public disclosure. The court may or may not
allow public meetings in the course of developing an PI/FS for a
site in litigation, and similarly may limit public comment on the
completed feasibility study. A court also may place restrictions
on information releases during negotiations or any meetings with
the public to discuss potential site remedy. Moreover, the rules
of ethics governing attorney conduct will have to be satisfied
in all cases. For example, the canons of ethics discourage and
even forbid extra-judicial publicity in certain circumstances.
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Where litigation or settlement through administrative nego-
tiations results in a consent decree for site cleanup, the consent
decree generally will be made available by the Department of
Justice for a public comment period of at least 30 days (see 28
CFR 50.7(c)). In addition, the Enforcement Decision Document
also will be made available by DOJ for public comment. The
Department of Justice will provide notice of the decree and EDO
in the Federal Register and will receive all comments. However,
community relations staff* also should provide notice to the public
of the conclusion of litigation and the procedures for commenting
on the consent decree and EDD. The notice and planned activities
should be the same as for administrative orders on consent, but
must be approved by the Department of Justice in advance. Finally,
responses to public comments are prepared by DOJ, with assistance
from Regional technical enforcement and Regional Counsel .personnel,
and presented to the court for review before the decree becomes
final. Community relations staff should work with appropriate
Regional personnel in developing the responses.
If administrative negotiations do not result in a settlement
agreement and a Fund-financed cleanup is conducted, EPA may initi-
ate litigation to recover the costs of response. Since cost
recovery generally follows site cleanup, community interest in
the site usually will have lessened. Community relations staff,
or other appropriate Regional Office personnel, after coordination
with the Department of Justice, should take the lead in responding
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to inquiries regarding current site conditions. All inquiries
regarding litigation should be forwarded to the EPA cost-recovery
team, which will prepare a response in conjunction with and with
the approval of the Department of Justice.
H. COMMUNITY RELATIONS DURING A RESPONSIBLE PARTY CLEANUP
EPA must maintain responsibility for community relations
during a cleanup managed by responsible parties pursuant to an
administrative order or consent decree. The scope and nature of
community relations activities will be the same as for Fund-lead
cleanups. Where responsible parties have participated in community
relations activities at the site as discussed in Section C, EPA
and responsible party roles already will have been determined.
However, where a responsible party has not been involved in imple-
menting the plan, EPA should continue solely to conduct community
relations activities, unless the responsible party shows sufficient
interest, commitment, and capability to warrant some level of
participation.
I. COMMUNITY RELATIONS DURING REMOVAL ACTIONS
At any time EPA may issue a unilateral administrative order
to compel a responsible party to undertake an immediate removal
or other urgent action, or the Agency may arrive at an agreement
with the PRPs to do the work, which would be embodied in an
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administrative order on consent. In addition, under certain
circumstances, the Agency may refer the action to the Department
of Justice to seek a court order to secure the removal. By
their nature, the situations giving rise to an immediate removal
or other urgent action do not allow for the same level of public
comment. Adjustments to the community relations process must
be made to fit the time constraints. However, once issued, a
unilateral administrative order or administrative order on consent
becomes a public document which should be made available to the
affected community. In addition, community relations staff should
discuss the terms of the order with citizens, local officials,
and the media and describe the removal action. If, however, the
responsible party fails to respond to the order, any statements
or information releases regarding the status of actions at the
site or prospective EPA actions must first be cleared with
appropriate Regional technical and legal enforcement personnel.
Consent orders for removals normally should be subject to
public review before becoming effective. However, if holding a
comment period for an immediate removal miaht delay implementation
of the order and endanger public health or the environment, this
procedure may be modified. In such instances, community relations
staff should discuss the order with citizens, local officials,
and the media and explain why the need for immediate measures
precludes establishing a formal comment period.
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Community relations activities during removals carried out
by responsible parties should be the same as for Fund-financed
removals. Responsible parties may participate, subject to the
same considerations described above in Section H.
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DRAFTING CONSENT DECREES IN HAZARDOUS WASTE
IMMINENT HAZARD CASES
336
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TABLE OF CONTENTS
Page
Introduction 1
I. Releases and Contribution Protection 2
A. Scope of Releases 2
B. Timing of Releases 3
C. Limiting Releases to Account for 3
an Inadequate Remedy
D. Contribution Protection 5
E. Sample Language on Releases and 7
Contribution Protection
II. Site Access 9
III. Authority of the Signatories 10
IV. Insurance/Financial Responsibility 10
A. Insurance 10
B. Financial Responsibility 11
V. Establishment of a Trust Fund 11
VI. Restrictions on Conveyance 13
VII. Priorities of Claims Versus Non-Settling 14
Parties
VIII. Preclusion of Claims Against the Fund 15
IX. Joint Responsibility Among Responsible 16
Parties for Implementing the Decree
X. Public Access to Documents 17
XI. Dispute Resolution Provisions 18
XII. Stipulated Penalties 20
XIII. Admissibility of Data 22
Disclaimer 22
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
MAY
MEMORANDUM
SUBJECT:
FROM;
TO:
Drafting Consent Decrees in Hazardous Waste Imminent
Hazard Cases
Courtney M.
Assistant Administrator for Enforcement
and Compliance
Jack W. McGr*
Acting Assismknt Administrator for Solid Waste
and Emergency Response
Regional Administrators
INTRODUCTION
On October 19, 1983, the Office of Legal and Enforcement
Counsel issued guidance on drafting judicial consent decrees.
That document provides general guidance on drafting consent
decrees for settlement of hazardous waste cases, provides a
checklist of provisions which ordinarily should appear in a
decree, and offers sample language for many commonly used
consent decree terms.
As the Agency enters into more and more consent decrees as
part of the hazardous waste program, there has arisen an
increasing need for supplemental guidance specific to imminent
hazard enforcement actions under the Comprehensive Environmental
Response, Compensation, and Liability Act (CERCLA) and section
7003 of the Resource Conservation and Recovery Act (RCRA).
These actions share common factual circumstances and yet are
sufficiently distinct from other enforcement programs to warrant
separate .additional guidance. For example, many hazardous
waste cases are characterized by multiple defendants, raising
unique liability issues which must be addressed in each decree.
This guidance document will focus- on those consent decree
provisions which are vital to settlement in hazardous waste
cases, but which are handled differently (or not at all) under
other programs.
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The guidance is based upon and supplements the Agency's
settlement policy as stated in a memorandum entitled "Interim
CERCLA Settlement Policy" (hereinafter "Settlement Policy")
which we issued, along with Hank Habicht of the Department of
Justice, on December 5, 1984. EPA enforcement personnel should
interpret and apply this memorandum consistently with the
Settlement Policy and any subsequent revisions thereto.
Each decree will be negotiated amidst widely varying factual
situations. Thus it is not appropriate to mandate the inclusion
of model terras in each hazardous waste decree. Rather, this
memorandum is intended to suggest ways of achieving the govern-
ment's settlement goals. The sample consent decree provisions
may be incorporated as is or modified to accommodate the
inevitable eccentricities present in each case.
I. Releases and Contribution Protection
Although the greater portion of this memorandum addresses
terms which the government wishes to include within consent
decrees, it is also useful to discuss the major provisions
which are generally requested by responsible parties in settlement
discussions, i.e., releases, covenants not to sue, and protec-
tions against contribution. Since releases directly at'fject
liability for current and future hazards posed by a site, these
provisions must be drawn as narrowly as possible.
A. Scope of Release
The Agency's policy, absent extraordinary circumstances,
is to grant releases from liability only for that part of a
cleanup performed or funded by the responsible parties. If
only surface cleanup has been effected, the release should
clearly be limited to liability for the work undertaken to
respond to surface contamination (as defined in the decree),
and should expressly reserve our right to bring actions against
the settling and non-settling parties for all other removal or
remedial activities. The release ordinarily should not forgive
government oversight, monitoring, and enforcement costs,
unless the settlement payment takes these costs into account,
nor should it include natural resource damages without the
consent of the trustee.
The consent decree should clearly state that the release
only extends to named parties to the agreement, and not to all
parents, subsidiaries, and affiliates, unless 100% of the
cleanup costs are recovered. Judicial or administrative causes
of action against any other parties are to be reserved. This
language is particularly crucial where State law may require
the release of all joint tortfeasors if a release is given to
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any one of them. Although it is our view that CERCLA calls
for uniform federal rules of decision, as a precautionary measure
consent decree releases, in these States should be phrased in
terms of a covenant not to sue in order to minimize the possibility
that non-settling parties would be released from liability by
the decree. Furthermore, the release should not extend to
liability under any statutory claim which did not form the
basis for the complaint or clearly apply to the activities of
the settling party. (For example,, a RCRA subtitle C regulatory
action release should not cover liability under section 3013
or 7003 of RCRA or section 106 of CERCLA). Similarly, a release
or covenant not to sue should expressly apply only to civil
-liability. Finally, in most cases (see the Settlement Policy,
page 15), releases should specifically reserve the defendant's
redisposal liability, i.e., liability arising from off-site
disposal of wastes removed from the site.
B. Timing of Releases
Many responsible parties have sought to obtain
releases which become effective in advance of completing the
needed abatement actions. As a general rule, the Agency should
require that releases only become effective when all of the
work (including monitoring. ) has been completed to EPA1s
satisfaction, whether defendants financed or conducted the
work.
C. Limiting Releases to Account for an Inadequate Remedy
Although settlement agreements are often designed to
accomplish a complete and permanent remedy, the Agency must
protect itself from the possibility that the chosen remedial
option will fail to entirely abate the releases at a .site and
the potential for an imminent and substantial endangerment
resulting therefrom. The Agency should use the consent decree
to minimize the risk that the government will be left to finance
a future cleanup resulting from failure of the remedy at the
site.
1. Where circumstances permit, compliance with
the decree should be linked to achieving enforceable performance-
based standards. The Agency must be in a position to move
against the settling parties for failure to attain a standard.
To the extent possible, the decree should not merely be a
broadly phrased agreement on a remedy designed to generally
meet the goals and objectives of the decree or the statute at
issue.
2. The decree should contain detailed oversight,
operation, maintenance, inspection, and monitoring requirements-
designed to prevent and uncover deviations from technical
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standards over an extended period of time. These requirements
should be embodied in workplans submitted for approval pursuant
to the decree.
3. The decree should contain financial responsibility
requirements, (discussed below), sufficient to cover any costs
arising from failure of the remedy.
4. The decree should clearly articulate any assumptions
upon which the remedial program is based. For example, a remedy
may be designed with certain characteristics of the surrounding
area in mind. If land use patterns change, (for example, where
a previously unused aquifer is tapped for drinking water), the
level of protection afforded to the environment by the remedy
may be insufficient to protect human health. If any ot the
stated assumptions change, the Agency should reserve the right
to pursue modifications to the remedial program.
5. Finally, the decree should contain a clause
authorizing the government to reopen the decree if the site
may present an imminent and substantial endangerment to the
public health or welfare or the environment due to:
The discovery of previously unknown'or
undetected conditions at the site; or
the receipt of new information concerning
the scientific premises of the decree.
(See the Settlement Policy, page 16.)
This reservation shpuld allow the government to obtain further
remediation by the defendants or perform the work itself and
seek cost recovery. Despite best efforts at designing,
constructing, and implementing a remedial program, it is
inevitable that in a certain percentage of cases additional
work will have to be performed to eliminate such endangerments.
Responsible parties, of course, want the decree to
represent a final disposition of responsibilities. However,
hazardous waste site abatement technology has not progressed
to the point where the Agency can be relatively sure that the
remedial techniques selected and implemented today will provide
complete and permanent protection to the public on the hundreds
of sites where work has been or will be performed. The five-part
program outlined above should maximize the degree of finality
afforded to settling parties consistent with the need to
safeguard the interests of the public.
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D. Contribution Protection
Contribution is an equitable remedy based on the
principle that one who has paid more than a reasonable propor-
tion of a judgment or debt is entitled to reimbursement from
other liable parties. The issue of contribution will be
particularly critical in multi-party cases that involve settle-
ments with fewer than all of the responsible parties and where
the government may still sue some or all of the non-settling
parties. Anticipating that the government may sucessfully
pursue a non-settlor, a defendant may demand that the United
States agree to protect it from any claim for contribution
from any non-settling party as a condition to signing a consent
decree. The effect of such A contribution protection clause
sought by a settling defendant would be to have the United
States agree to reduce its judgment against a non-settling
responsible party by the amount of contribution ordered to be
paid by a settling defendant to the non-settling party in
subsequent litigation.
It is the Agency's view that contribution protection
clauses are largely unnecessary. Many States* have already
enacted laws which protect settlors from subsequent contri-
bution actions. These laws have been modeled on Section 4 of
the Uniform Contribution Among Tortfeasors Act (1955 Revision),
drafted by the National Conference of Commissioners on Uniform
State Laws, which provides:
"When a release or a covenant not to sue or
not to enforce judgment is given in good faith
to one of two or more persons liable in tort
for the same injury or the same wrongful death:
"(a) It does not discharge any of the other
tortfeasors from liability for the injury or
wrongful death unless its terras so provide;
but it reduces the claim against the others to
the extent of any amount stipulated by the
release or the covenant, or in the amount of
the consideration paid for it, whichever is
the greater; and,
* Seventeen States have adopted this Section or a similar
provision: Alaska, California, Colorado, Florida, Illinois,
Massachusetts, Michigan, Missouri, Nevada, North Carolina,
North Dakota, Ohio, Oklahoma, Oregon, Tennessee, Virginia, and
Wyoming.
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"(b) It discharges the tortfeasor to whom' it
is given from all liability for contribution
to any other tortfea-sor."
Under this rule, once a reasonable, comprehensive, and good
faith agreement has been reached, settling parties would be
immune from third-party contribution claims.
The7Agency is taking the position that federal courts
should use the model rule as the standard for resolving
contribution questions. The United States will be willing to
include language in a consent decree which states that it
is the intention of the parties that future contribution
actions against settlors be prohibited and encouraging courts
to consult the Uniform Act as the federal rule of decision.
Contribution protection clauses will therefore generally not
be necessary for consent decrees.
As the Settlement Policy points out, however, providing
protection from contribution to settling defendants may be
appropriate in limited cases. If, under the law likely to be
applied, contribution actions by nonsettling defendants may
be permitted, EPA may consider providing contribution protection
when two factors are present:
1) the settlement addresses a very high percentage of the
total cleanup; and
2) the relative responsibilities of the responsible
parties can be clearly allocated, so that future actions are
not likely to reapportion liability.
On a case-by-case basis, the litigation team will assess whether
these factors and other circumstances in the case warrant
inclusion of contribution protection in the decree.
Of course, the greater the percentage of cleanup covered
by the decree, the lower the risk that claims for contribution
will be successfully asserted against settling parties. Compre-
hensive settlements will maximize the chances that compliance
with the terms of the decree discharges a company's liability
for a site.
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E. Sample Language on Releases and Contribution
Protection
The following sample consent decree language assumes
that total cleanup has been or will be undertaken by the
responsible parties pursuant to EPA approved procedures. It
also assumes that the site is located in a State where the
release of one joint tortfeasor operates as a release on all
others.
Covenant Not to Sue
In consideration of work which has been and
will be performed and payments which have
been made by the Company under the terms of
the Decree, the Governmental Parties (herein-
after "Government") hereby covenant not to
bring any civil judicial or- administrative
action against the Company and its officers
and employees for any claim or cause of
action cited in the Complaint relating to
"covered matters." "Covered matters" include
liability arising from [work performed under
the decree] and [specified costs incurred to
date]. The covenant shall become effective
upon completion to EPA's satisfaction of the
remedial activities described in the attached
specifications. To the extent that State
law is deemed to govern liability arising
from activities related to the Site and the
interpretation of the terms of this Decree,
the parties do not intend this section to
serve as a general unqualified release.
This section should be construed as a covenant
not to sue the Company, and should not act
to release any other party from liability.
This covenant not to sue does not extend to
liability for damage to natural resources, as
defined in CERCLA, to liability arising from
hazardous waste removed from the site, or to
future monitoring or oversight expenses incurred
by the Government. In addition, notwithstanding
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any other provisions of this decree, the Government
reserves the right to seek modification to this
Decree or institute a new action to seek additional
remedial measures at the site, through an action
to compel the defendants to perform remedial work
or reimburse the Government for cleanup costs, if:
(1) at any time previously unknown or undetected
conditions at the Site present or may present an
imminent and substantial endangermeht to the
public health or welfare or the environment;
(2) the Agency receives new information,
concerning the nature of the substances at
the site or the appropriateness ot the remedy
described in Appendix I, which indicates that
site conditions may present an imminent and
substantial endangerment to the public health
or welfare or the environment.
(3) [there occurs a change in one or more
assumptions upon which the remedial program
is based. (See discussion in part C above).]
The parties recognize the possibility that
there may be brought or asserted against the
Company suits or claims for contribution for
liability for covered matters by persons or
entities that have not entered into this
settlement that might, if successful, obligate
the Company to pay amounts toward covered
matters in addition to those recognized in
this Decree. It is the expressed intention
of the parties that the Company not be required
to pay amounts in contribution for covered
matters or be required to remain as parties
in any suit or claim for contribution for
covered matters. It is also agreed that the
Government shall be under no obligation to
assist the Company in any way in defending
against such suits for contribution.
The parties represent that this Decree was
negotiated in good faith and that the
Company's undertakings at the Site represent
a fair and equitable assumption of the Company's
alleged responsibilities for covered matters
considering, among other factors, the fact that
it is in the best interest of the Government
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to encourage equitable settlements without
burdensome litigation. The parties agree
that federal law should govern questions
of contribution among parties that may be
adjudicated to be liable jointly or severally
for covered matters. The parties agree
that, in determining the appropriate federal
rule of decision to establish the effect of
this Decree on possible rights of contribution,
a court should adopt the principle set forth
in Section 4 of the Uniform Contribution Among
Tortfeasors Act.
II. Site Access
It is essential that EPA have access to the site in order
to observe any work taking place and monitor compliance with
the terms of the decree. Language granting access should
provide access during the effective period of the decree and
describe the scope of the inspector's powers.
A sample site access clause is:
During the effective period of this decree,
EPA or its representatives, including
contractors, shall have access at all times
to the Site and all property owned or
controlled by the defendant for purposes of
conducting any activity authorized by CERCLA,
including but not limited to:
A. Monitoring the progress of activities
taking place;
B. Verifying any data or information
submitted to EPA;
C. Conducting investigations relating to
contamination at or near the site;
. D. Obtaining samples at the site; and
E. Inspecting and copying records, operating
logs, contracts, or other documents
required to assess the defendant's
compliance with the Decree.
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In addition, the defendant will not object to
EPA's obtaining, for the above purpose, access
to any establishment or place owned or operated
by any third party under contract with the
defendant. Nothing herein limits or otherwise
affects any right of entry held by EPA pursuant
to applicable laws, regulations, or permits.
Where it is necessary for EPA to have access to the
property of a defendant for a long period of time, an easement
over the property may be desirable. The easement should run
with the land and be recorded to place all future purchasers
on notice.
It is important that access considerations be taken into
account at the beginning of a lawsuit in order that all
appropriate parties be brought under the court's jurisdiction.
The government may often want to name an "innocent" landowner
as a defendant solely for the purpose of facilitating access
to his or her property to conduct response activities.
III. Authority of the Signatories
Obviously it is important that persons signing a<
settlement agreement have authority to sign for.and bind their
principals. Sample language to provide for this is:
Each of the signatories to this Decree certifies
that he or she is fully authorized to enter into
the terms and conditions of this Decree and
to legally bind the party to the Decree so
represented by him or her.
Where there is any doubt regarding the commitment of the
principals to the decree, or in cases where substantial suras
are at stake, the government, in an abundance of caution, may
wish to require that the principals themselves be signatories
to the decree.
IV. Insurance/Financial Responsibility
A. Insurance. Where the cleanup is being conducted
by a responsible party, the party should be required to
protect both itself and EPA from liability, by purchasing
insurance or through another financial mechanism, from injuries
to third parties due to acts or omissions of the party conducting
the work. For example:
The Company shall purchase and maintain in
force insurance policies in the maximum amount
available, which shall protect the United
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States and the public against any and
all liability arising out of the Company's
and its contractors' and other agents'
acts or omissions in performance of the
work. Prior to commencement of work at
the Site, the Company shall provide EPA
with a certificate of insurance and a copy
of the insurance policy for EPA's approval.
B. Financial Responsibility. In addition to liability
.insurance, it is important to have assurance that the party
conducting the work will have the financial capability to
complete the work. This can be accomplished by several means:
(1) Performance bond;
(2) Letter of credit;
(3) Guarantee by a third party; or
(4) The party conducting the work can present the
Agency with internal financial information sufficient to satisfy
the Agency that the party ha's enough assets to make it unnecessary
to require additional assurances. If this method of financial
responsibility is chosen and if the terra of compliance within
the Decree is greater than one year, then the Decree should
provide for the party to annually submit internal financial
information. If the Agency then determines the financial
assurances to be inadequate, the Decree should provide that
the party can be required to obtain a bond or one of the other
financial instruments listed above.
A performance bond by a reputable company is generally
the preferred type of assurance. The bond should assure that
the work will be completed regardless of remaining cost. The
latter two mechanisms require a detailed examination of the
financial status of the party doing the work and the Guarantor.
No matter which financial instrument is used, EPA should be
authorized in the Decree to approve such instrument before it
is incorporated into the agreement.
V. Establishment of a Trust Fund
Frequently in multiple-party generator cases, the
generators will want to select a contractor to clean up the
site. If the contractor is a party to the litigation, the
consent decree may make the contractor expressly responsible
for the cleanup and the generators responsible for paying for
the cleanup. However, in order to assure completion of the
work, the generators should also remain liable until completion.
The funds to pay for the cleanup are collected in advance from
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the generators. The most commonly used mechanism for accomp-
lishing this is the establishment of a trust fund or escrow
account for paying the contractor. The trust fund or the
account can be administered by a State or o-ther public entity
or a bank or similar entity experienced in administering trust
funds. Neither EPA nor other Federal agencies should administer
the fund. However, the Decree should provide that EPA must-
approve the form of the Trust or escrow agreement. The consent
decree should specify how the fund will be created, how much
money is to be deposited into the fund, and how disbursements
will be made from the fund. The fund account should earn
interest.
Disbursements are usually linked to completion of certain
milestones required by the decree. Agency approval may be
required for each disbursement. The final payment should not
be made until the contractor has certified, and the Agency ha.s
confirmed, that all work to be paid for by the fund has been
completed. It may also be desirable to establish a schedule of
payments from the fund to assure that the money remaining in
the fund is sufficient to pay for completion of the cleanup
should the contractor default. The Decree should provide that
EPA does not guarantee the sufficiency of the fund. A sample
trust fund clause is:
Within three days after the .entry of this
Decree, the Companies each shall pay to the
site Trust Fund (hereinafter the "Trust Fund")
established at the Bank the sum which is shown
for that Company in Exhibit A hereto. Prior to
establishment of the Trust Fund, the for.ni of the
trust agreement must be submitted to EPA
for its approval. The Trustee shall deposit
the money in an interest-bearing account
and use the money in the Trust Fund to pay the
Contractor to perform the Work described in
Exhibit B hereto (hereinafter referred to as
the "Work"), which Exhibit is hereby incorporated
by reference and made a part of this Decree as
though it were set forth verbatim. All money
remaining in the Trust Fund after completion
of the work, including interest earned, shall
be deposited in the Hazardous Substances Response
Trust Fund as recompense for response costs
incurred by the United" States not otherwise
reimbursed under the terms of this Decree.
EPA does not guarantee the monetary sufficiency
of the Trust Fund established by this section.
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A sample Schedule of Payment clause is:
The funds will be disbursed in accordance with
the following schedule.
(a) Upon entry of this Decree the Contractor
shall receive $100,000 from the Trust Fund.
(b) Upon completion and approval by EPA
of items 1, 2, and 3 of the Work, the
Contractor shall receive $300,000 from the
Trust Fund within no more than 20 days
after receipt of the Trustees of an applica-
tion for payment by the Contractor.
(c) Upon completion and approval by EPA,
of items 4, 5, 6, and 7 of the VJork, the
Contractor shall receive $500,000 from the
Trust Fund within no more than 20 days after
receipt by the Trustees of an application for
payment by the Contractor.
(d) Upon inspection of the Site and
certification by the United States that
the Contractor has completed the Work, the
Contractor shall receive "$500,000 from the
Trust Fund within no more than 30 days after
receipt by the trustees of an application
for payment by the Company. All remaining
money in the Trust Fund, including earned
interest, shall be deposited in the Hazardous
Substances Response Trust Fund.
VI. Restrictions on Conveyance
It is important that a subsequent purchaser of real
property is notified that the site is the subject of a consent
decree, and that he may be required to fulfill the terms
therein. There are several methods of providing such notice:
1. Depending upon the State, one may notify a
subsequent purchaser by recording or filing a copy of the
consent decree with the County Recorder (Registry of Deeds) or
Clerk of Courts, so that a title search would reveal the exis-
tence of the decree. Individual State law will have to be
considered as to the proper method of recordation.
2. The decree may require that the grantor notify
the plaintiff, prior to the transfer of title, of the name of
the grantee and, subject to EPA approval, what specific
requirements of the consent decree will be performed by the
grantee.
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3. The grantor may be required to include
notification in the conveyance (deed) that the property is
subject to the terms of the consent decree, and may also be
required to describe in the conveyance the prior use of the
site, (e_«g. , use as a hazardous waste disposal facility).
The major concern in fashioning any type of language is to
allow for free alienation. Language such as the following
should achieve our objectives:
Within thirty days of approval by the Court
of this' Decree, defendant shall record a
copy of this Decree with the Recorder's
Office, County,'State
of .
The site as described herein may be freely
alienated provided that at 'least sixty days
prior to the date of such alienation defendant
notifies plaintiff of such proposed alienation,
the name of the grantee, and a description of
defendant's obligations, if any, to be performed
by such grantee.. In the event of such alienation,
all of defendant's obligations pursuant to this
Decree shall continue to be met by defendant or,
subject to EPA approval, by, the grantee.
Any deed, title or other instrument ot conveyance
shall contain a notice that the site is the
subject of this Decree, setting forth the style
of the case, case number, and Court having
jurisdiction herein.
These provisions, of course, are only applicable to sites
where the landowner is a named defendant. In cases involving
non-landowner defendants, the government may wish to specify in
the decree that sale of the site has no effect on the obligations
of such defendants.
VII. Priority of Claims Versus Non-Settling Parties
When a case is settled for less than the total amount
necessary to complete a response action or to reimburse
plaintiff fully for costs incurred, it may be done so with the
anticipation that the non-settling parties will be available
to reimburse the Agency for the remaining balance and/or
complete the response action. To ensure that sufficient funds
are available or to avoid delay in collecting on any judgments
as to non-settling parties, a provision may be included in the
consent decree providing that an Agency judgment obtained
against non-settling parties takes priority over that obtained
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by any of the settling parties. Sample priority of claims
language is as follows:
Defendant's claim against any other responsible
party in this or any other proceeding fcir
contribution or indemnification of all or a
portion of the cost of its settlement herein
shall be secondary to the United States'
claim against such other responsible party
as to any remaining balance for the response
actions or other costs incurred for action
taken at the Site.
VIII. Preclusion of Claims Against the Fund
Section 112 of CERCLA provides a procedure whereby a
private party which has performed a CERCLA cleanup may assert
claims to recover such costs from the Fund assuming the party
has received "preauthorization" pursuant to the National
Contingency Plan. See 40 CFR S 300.25(d). The right to
recover such claims is subrogated to the United States by the
payment of such a claim.
In multiple party consent decrees, it is important to
include a provision prohibiting future claims against the Fund
by the responsible parties, unless the responsible parties
are explicitly preauthorized to bring a claim as part of the
settlement.V Such a provision is particularly important in
cases where defendants may later allege that the percentage
of the total remedial costs that they contributed to the settle-
ment is disproportionate to the extent that they contributed
to the problem at the site.
The language should be extremely broad and unequivocal.
An example of such a provision is provided below:
In consideration of the entry of this Consent
Decree, defendants agree not to make any claims
pursuant to Section 112 of CERCLA, 42 U.S.C.
Section 9612, or any other provision of law
directly or indirectly against the Hazardous
Substance Response Trust Fund established by
CERCLA or other claims against the United States
"^J As EPA policy on the issue of combining private party
cleanup with Fund expenditures evolves, there may arise
situations where a claim against the Fund would be permissible.
The language above should be followed pending further guidance
on circumstances where exceptions might be permitted. In addition,
statutory amendments to CERCLA that would obviate the need for
this provision are currently under consideration by Congress.
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for expenses related to this case and this
Consent Decree. Nothing in this Consent Decree
shall be deemed to constitute preauthorization
of a CERCLA claim within the meaning of 40 CFR
§ 300.25(d).
Consent decrees with similar provisions include the Petro
Processors, Bluff Road, Chem-Dyne, and Seymour decrees. In
cases involving just one responsible party, such a provision
should also be included since there is always some doubt
concerning whether there may be other, perhaps unknown at the
time, responsible parties.
This provision should be relatively non-controversial
because any defendant willing to enter a consent decree
presumably is willing to pay the portion of the cleanup
specified in the decree.
IX. Joint Responsibility Among Responsible Parties for
Implementing the Decree!~~
The Agency has consistently interpreted CERCLA as
authorizing imposition of joint and several liability on all
responsible parties. The predominant, case law accepts that
interpretation. It is important to preserve this principle in
multiple defendant cases. Also, from, a practical point of
view, it is necessary to have the consent decree recognize
joint responsibility in order to prevent the insolvency or
other problems of one defendant from delaying the entire
cleanup.
In order to provide assurance that cleanup will proceed
on schedule, consent decrees should include a joint responsi-
bility provision, such as the example set forth below:
The Industry Defendants shall implement the
remedial actions for both sites as provided
in this Decree, in accordance with the
schedules established in the various plans
and in this Decree.
In the event of the insolvency or other
inability of any one or more Industry
Defendants to implement the activities
required by this Decree, the remaining
Industry Defendants agree to complete all
such activities and actions required by
this Decree.
If there is only one responsible party, then particular
care must be taken in drafting the Guarantee, Performance/
Completion Bond or Financial Responsibility provisions, to
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provide assurance thac there will be adequate resources to
complete implementation of the remedial measures.
X. Public Access to Documents
Many consent decrees require an elaborate investigation
and study phase, similar to a CERCLA RI/FS, before some or all
of the final remedial .actions are determined. In all cases,
many engineering details, protocols, and specifications are not
determined until the consent decree is implemented. Substantial
amounts of technic.-.L information and detail will be determined
during the implementation of the consent decree under EPA's
oversight.
The public is often intensely interested in the progress
of such remedial actions. When EPA is performing the remedial
action pursuant to CERCLA, the Agency makes information and
draft proposals available through a community relations plan.
It is EPA policy to implement at all sites, regardless
of whether the cleanup is performed by the government or the
responsible party, a community relations plan which encourages
public participation in the cleanup process. This policy,
however, must be balanced against the need for confidentiality
in enforcement actions. Since the implementation of a cons-ent
decree may give rise to disputes with the responsible party
which end up before the court, implementation of the consent
decree is still litigation-related.
In general, consent decrees should contain provisions
that explicitly require that all technical data and factual
information generated and submitted by the defendant are
available for public inspection unless they are requested to
be made confidential by the defendant pursuant to EPA regulations
(see 40 C.F.R. Part 2). Where possible, specific and general
categories of data and information that the defendant must
make public should be specified. Because of the need to protect
open and frank interagency communication, this provision should
not apply to Agency information or documents. However, raw
technical data generated by EPA or the State, if applicable,
should be made public nonetheless after all applicable quality
assurance/quality control protocols have been complied with.
After a consent decree is signed, EPA and the defendants
may nonetheless continue negotiations over matters left
unresolved by the decree, (e.g. , remedial proposals which must
await completion of additional sampling and analysis). In some
cases, EPA and the defendants might be urged to make public
all draft remedial proposals leading up to settlement. To
avoid this unproductive and impractical procedure, EPA should
include explicit language in the consent decree exempting
negotiation documents from the public disclosure provision.
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Also, EPA should consider clearly articulating from the outset
of the community relations program that "negotiation" documents
are not official submissions within the meaning of the consent
decree clause.
An example of such a provision is provided below.
All data, factual information, and documents
submitted by the Defendant to EPA and the
State pursuant to this Consent Decree shall
be subject to public inspection unless
identified as confidential by Defendant
in conformance with 40 C.F.R. Part 2 or
applicable State law or otherwise exempted
by the terms of this Consent Decree. The data,
factual information and documents so identified
as confidential will be disclosed only in
accordance with EPA regulations or applicable
State law. The Defendant shall not assert
confidentiality regarding any hydrogeological
or chemical data, data submitted in support
of a remedial proposal or any other
scientific or engineering tests or data.
This provision does no-t apply to documents
exchanged by the parties relating to issues
of liability or the determination what additional
remedies, if any, other than those specifically
required by the terms of this Decree, may be
necessary to remedy conditions at the site.
XI. Dispute Resolution Provisions
Hazardous waste consent decrees may require one or
several parties to take samples, perform studies, and implement
other remedial steps about which there may arise differences
of opinion whether the obligation was satisfied. Such
differences of opinion may also arise over whether or not a
force maj eure event has occurred, or whether the defendant has
incurred liability to pay stipulated penalties under the decree.
As noted in the general guidance on consent decrees, it is
useful for the decree to specify a mechanism or mechanisms to
resolve such disputes.
Such mechanisms may include negotiations among the parties
as well as judicial resolution. The sample language below
provides for both, although the parties would probably discuss
the issue and engage in limited negotiations even if the decree
did not expressly mention such a mechanism.
Particularly where the dispute concerns the implementation
of remedial work, it is important to resolve it quickly. Some
disputes may be more quickly resolved by discussion and
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negotiation.among the parties rather than a judicial hearing;
however, it is important not to allow negotiations to consume
too much time. Therefore, the government should not hesitate .
to seek judicial resolution of disputes which the parties
cannot readily resolve among themselves.
Where possible, it is helpful to minimize the drain on
Agency resources by placing on the defendant the burden to
demonstrate that its proposal is most consistent with the
purposes of the decree. An acceptable sample provision follows
DISPUTE RESOLUTION
The parties recognize that a
dispute may arise among defendant, EPA
and the State regarding plans, proposals
or implementation schedules required to be
submitted by defendant pursuant to the terms
and provisions of this Consent Decree, or
regarding whether a force majeure event, as
defined in paragraph of this Decree,
has occurred, or whether defendants have
incurred liability to pay stipulated penalties
under paragraph . If such a dispute arises,
the parties will endeavor to settle it by good
faith negotiations among themselves.' If the
parties cannot resolve the issue within a
reasonable time, not to exceed thirty calendar
days, then any party may file a petition with the
Court setting forth the matter in dispute.
The filing of a petition asking the court
to resolve a dispute shall not extend or
postpone defendant's obligations under this
decree with respect to the disputed issue.
In the event of a dispute between
defendant and EPA or the State, defendant
shall have the burden of: (1) showing that
its proposal is more appropriate than the
proposal of EPA or the State to fulfill the
terms, conditions, requirements and goals
of this Decree, and (2) demonstrating that
its proposal is consistent with the National
Contingency Plan; will abate hazards at the
site; and will protect public health, welfare,
and the environment from the release or
threat of release of hazardous substances at
the site. If the dispute concerns an issue
of science, technology, or public policy
within the areas of EPA's expertise, the
Court shall adopt the position (if any)
proposed by EPA, unless the Court finds that
position to be arbitrary and capricious.
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XII. Stipulated Penalties
Hazardous waste decrees which establish obligations for
defendants to complete in the future should contain stipulated
penalty provisions to assure that the defendant will comply
with its obligations and to minimize disputes over the
appropriate sanction for failures to comply. Such obligations
will typically include the implementation of remedial work
(including construction requirements), and reporting and
monitoring requirements.
The purpose of a stipulated penalty clause is to deter
potential violations of the decree by associating with each
violation the immediate obligation to pay a large enough
penalty to make compliance more attractive than violation.
However, even payment of a stipulated penalty should not
deprive the government (or the court) of other remedies,
including injunctive relief, and every stipulated penalty
provision should contain a clause to this effect. Stipulated
penalties should never be considered as setting a maximum
penalty exposure, subject to negotiation downward.
The authority of the district court to impose monetary
penalties or fines for prospective violations .of consent
decrees flaws not only from the.civil penalty authorities of
the environmental statutes (e.g., RQRA §§ 3008, 7003(b);
CERCLA § 106(b)), but also from the court's civil contempt
power—its independent statutory authority to punish violation
of its lawful orders by fine or imprisonment. 18 U.S.C.
§ 401. When fines under § 401 are prospective, applying only
to future violations, they are considered "coercive," intended
to give the defendant an incentive to comply with the court's
order. Prospective fines under § 401 are not subject to the
monetary limits in the penalty provisions of other statutes.
Stipulated penalties should be large enough to provide a
real incentive to the defendant to fulfill its obligations on
time, considering the financial strength of the defendant, any
economic saving from delaying compliance, and any harm or risk
of harm to public health or the environment from delaying
compliance. (See Perfect Fit Industries, Inc. v. Acme Quilting
Co., Inc.. 673 F.2d 53 (2d Cir. 1982). ceftT"denied 103 S.Ct. 73.)
At the same time, the magnitude of stipulated penalties should
not be so great that the defendant prefers to allow the govern-
ment to perform remedial work with Superfund money, rather
than perform work itself.
Depending on the facts of the case, it may be appropriate
to: a) specify all numbered paragraphs the violation of which
will be penalized; b) establish a schedule of per diem penalties
which increases with the duration or extent of the violation;
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or c) establish higher penalty amounts for more important
violations.
Stipulated penalties may be divided between the United
States and a State as co-plaintiffs, provided that: (1) the
State has taken an active part in the litigation, including
the seeking of stipulated penalties, and (2) State law provides
independent authority for the State to obtain civil penalties.
The following sample language demonstrates escalated
stipulated penalties, and a division of stipulated penalties
between the United States and a State.
STIPULATED PENALTIES
(A) Unless excused by the provisions
of paragraph [force majeure clause], the
Defendant shall pay the following stipulated
penalties for'any failure to comply with
time requirements of this Consent Decree,
including any implementation schedules
submitted by Defendant and approved by
EPA/State or this Court:
Period of Failure to Comply Penalty Per Violation Per Da"y
1st through 14th day $1,500
15th through 44th day $5,000
45th day and beyond $10,000
(B) Stipulated penalties under this paragraph
shall be paid by two certified checks of equal
amounts with one-half of the daily penalty payable
to the "Treasurer of the the United States" and
the other one-half payable to the "Arkansas
Department of Pollution Control and Ecology."
(C) The stipulated penalties set forth above
shall be in addition to any other remedies or
sanctions which may be available to EPA/State by
reason of Defendant's failure to comply with the
requirements of this Consent Decree.
(D) If the parties disagree whether
Defendant has violated a provision of this decree
for which a stipulated penalty is due, the
Defendant may petition the Court under [dispute
resolution paragraph]. Defendant must file any
such petition within 30 days of receiving written
demand for payment from the Plaintiff.
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XIII. Admissibility of Data
In order to avoid disputes over the integrity of sample
results or other data in the event that the parties disagree
over how to implement the consent decree, the decree should
provide that verified data is admissible in evidence.
A model clause is:
The Defendants waive any evidentiary
objection to the admissibility into evidence
of data gathered, generated, or evaluated
pursuant to this decree that has been verified
by the quality control/quality assurance
procedures contained in part ^_. However,
a Defendant may object to a specific item
of evidence if the objecting party demon-
strates that such item of evidence was not
gathered or generated in accordance with che
sampling and analytical procedures estab-
lished pursuant to the site Work Plan.
The Decree should provide that EPA must approve sampling
and analytical procedures. Additionally, it is necessary for
there to be a careful oversight program..
DISCLAIMER
The policies and procedures established in this document
are intended solely for the guidance of government personnel.
They are not intended and cannot be relied upon to create any
rights, substantive or procedural, enforceable by any party in
litigation with the United States. The Agency reserves the
right to act at variance with these policies and procedures and
to change them at any time without public notice.
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, O.C. 20460
OFFICE OF
SOLID WASTE AND EMERGENCY RESPONSE
MEMORANDUM
SUBJECT: Procedures for Planning and Implementing Off-site
Response Act-ions
FROM: J/al-kW. Md'GraW'"'
Acting Assistant Administrator
TO: Regional Administrators
Regions I-X
This memorandum addresses procedures that must be observed
when a response action involving off-site storage, treatment or
disposal of hazardous substances is selected under the Compre-
hensive Environmental Response, Compensation, and Liability Act
of 1980 (CERCLA), and the Resource Conservation and Recovery Act
(RCRA). It prohibits use of a RCRA facility for off-site manage-
ment of Superfund hazardous substances if it has significant
RCRA violations* or other environmental conditions that affect
the satisfactory operation of the facility. It also addresses
requirements for analyzing and selecting response actions that
involve permanent methods of managing hazardous substances.
In November of 1984, amendments to the Resource Conservation
and Recovery Act were enacted. These, amendments impose new
requirements for the safe management of hazardous wastes. In
the case of land disposal facilities, the amendments require
that certain types of units (new, replacement and lateral exten-
sions) be double lined by May 9, 1985. The amendments impose
technical requirements to ensure that when land disposal facilities
are used they are used safely.
EPA intends to follow the direction established by Congress
in the RCRA amendments when undertaking on-site response actions
1 A significantviolation includes a Class I violation as defined
by the RCRA Enforcement Response Policy (December 21, 1984).
This policy defines a Class I violation as a violation that
results in a release or a serious threat of release of hazardous
waste into the environment, or involves the failure to assure
that ground water will be protected, that proper closure and
post closure activities will be undertaken, or that hazardous
wastes will be destined for and delivered to RCRA permitted or
interim status facilities. The policy contains a list of
examples of violations which are Class I violations. Regions
should recognize that violations other than Class I violations
may be significant for purposes of these procedures, depending
on the situation at the facility.
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and when response actions involve off-site management of hazardous
substances. This memorandum details how the Agency plans to
achieve these goals.
Section I of this memorandum discusses background issues.
Section II A discusses the need to consider treatment, recycling
and reuse before off-site land disposal is used. Section II B
details procedures that must be followed in selecting any off-site
facility for management of hazardous substances. This section
also discusses the criteria to be used in making the selection.
For facilities in assessment monitoring, this part states that
conditions which lead to and result from being in assessment
monitoring may constitute conditions that render the facility
unsuitable for disposal of hazardous substances. Therefore,
when a facility is in assessment, the conditions which lead to
the required assessment, and any monitoring data, must be evalu-
ate-d to determine if the facility poses such conditions. If so,
the facility may not be used unless the owner or operator commits
to correct the problems and the unit to be used for disposal
poses no problems.
Section III discusses RCRA manifest requirements. Section IV
discusses PCB disposal requirements. Finally, Section V details
how this policy will be implemented. Attachment A is a chart
summarizing the policy on use of off-site RCRA facilities. This
chart should be used in conjunction with the policy document, not
in lieu of it.
These procedures are applicable to all response and enforce-
ment actions taken pursuant to CERCLA and section 7003 of RCRA.
This memorandum replaces guidance entitled "Requirements for
Selecting an Off-Site Option in a Superfund Response Action",
dated January 28, 1983. This policy is an interim one that the
Agency intends to publish as a notice in the Federal Register
in order to receive public comment on its provisions. After
reviewing these comments EPA will determine whether revisions
are necessary.
These revisions strengthen previous requirements in several
ways :
0 Coverage - This memorandum extends requirements to
enforcement actions under §106 of CERCLA and §7003 of RCRA,
and expands requirements for removal actions.
0 Use of Treatment - These procedures require consideration
of treatment, recycling or reuse for all response and
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enforceraent actions, to foster the use of more permanent
solutions, and, in the case of remedial actions, where
cost-effective. The Agency is not certain whether
sufficient capacity is available at this time to use
treatment in all cases where it is feasible. As more
information on capacity becomes available, the Agency
will re-examine requirements for treatment to determine
whether they can be strengthened. The previous procedures
did not address use of treatment.
0 Requirements for a treatment, storage or disposal facility
Previous guidance required inspection within 12 months
before contract award for storage, treatment or disposal.
The revisions require inspection within six months of
actual storage, treatment or disposal. It also stated
that if a facility had deficlences that resulted in unsound
treatment, storage or disposal practices it should not be
used. The guidance also required RCRA violations that
adversely affected facility performance to be corrected
prior to contract award. Under the revisions, a facility
that has significant RCRA violations or other environmental
conditions that affect its satisfactory operation may not
be used unless certain conditions are met. First, there
must be a compliance agreement in place to correct all
deficiencies at the facility; second, the unit that is
used must not cause or contribute to significant problems
at the facility. This provision recognizes that in some
situations it is infeasible to complete correction of all
violations prior to using a facility (for example, it may
take several years.before pumping and treating of ground-
water is completed) and that there may be a unit at such
a facility that is sound*
0 Land Disposal Facilities - The 1984 RCRA amendments impose
new requirements on land disposal facilities. When use
of such facilities is contemplated, the policy requires that
the facility meet these minimum technical requirements.
I. BACKGROUND
Facilities that are not in compliance with RCRA requirements
may be unacceptable to use for treatment, storage or disposal of
hazardous substances from response actions. Facilities used for
management of substances in connection with response actions
should not pose a significant threat to public health, welfare or
the environment.
CERCLA contains two references to off-site management of
hazardous substances. First, CERCLA section 104(c) requires, as
a condition of Fund-financed remedial response, that the State
assure the availability of an acceptable facility in compliance
with the requirements of subtitle C of RCRA for any off-site
management of hazardous substances. Second, where remedial
measures include off-site storage, treatment, destruction or
secure disposition, the statute also requires such measures to
be more cost-effective than other remedial measures, create new
disposal capacity in compliance with Subtitle C of RCRA or be
necessary to protect public health, welfare or the environment
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from a present or potential risk which may be created by further
exposure to substances. Section 300.65 (b)(6) of the National
Contingency Plan (40 CFR 300) states that when off-site action is
taken in connection with a removal action the facility used for
off-site management must be in compliance with Subtitle C of
RCRA. This memorandum establishes procedures for implementing
these CERCLA and NCP provisions.
These procedures apply to all removal, remedial, and enforce-
ment actions taken pursuant to CERCLA and section 7003 of RCRA.
Any other parties undertaking cleanup under other authorities
are urged to comply with these procedures. In the case of
Superfund-financed removal actions or enforcement actions taken
as a removal action in response to an immediate and significant
threat, compliance with these procedures is mandatory unless the
On-Scene Coordinator (OSC) determines that the exigencies of the
situation require off-site treatment, storage or disposal without
following the requirements. This exception may be used in cases
where the OSC believes that the immediacy of the threat posed by
the substances makes it imperative to remove the substances and
there is insufficient time to observe these procedures without
endangering public health, welfare or the environment. In such
cases, the OSC should consider, to the extent possible, temporary
solutions (e.g., interim storage) in order that the feasibility
of using treatment can be evaluated prior to a decision to use
land disposal. Also, in such cases, the OSC must provide a.
written explanation of his decision to the Regional Administrator.
This explanation should be provided within 60 days of taking
the action. In Regions in which authority to make removal deci-
sions has not been fully delegated by the Regional Administrator,
the decisions discussed above must be made by the Regional official
that is delegated removal decision making authority.
II. PROCEDURES FOR SELECTING HAZARDOUS WASTE MANAGEMENT FACILITIES
This section discusses in detail the requirements Regions
must follow in assessing and selecting an off-site RCRA facility
for management of Superfund hazardous substances. Part A requires
consideration of treatment, recycling or reuse for on-site and
off-site actions in order to foster the use of more permanent
methods of managing hazardous substances. These policies are
consistent with directions taken by Congress in the 1984 amend-
ments to the Resource Conservation and Recovery Act. Furthermore,
Part B of this section establishes procedures Regions must use
in selecting an off-site RCRA facility for management of hazardous
substances. Where off-site land disposal must be used, this Part
requires that disposal facilities be in compliance with the appli-
cable technical requirements of RCRA.
A. Treatment
It is EPA's policy to pursue response actions that use
treatment, reuse or recycling over land disposal to the greatest
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extent practicable, consistent with CERCLA requirements for
cost-effective remedial actions. EPA requires that such alterna-
tives be considered for all Fund-financed and private party
removal and remedial actions* For Fund-financed removals or
enforced actions in response to immediate and significant threats,
treatment, reuse or recycling must be considered, unless the OSC
determines that treatment, reuse or recycling methods are not
reasonably available considering the exigencies of the situation,
or they pose a significant environmental hazard.
When developing remedial alternatives, treatment, reuse or
recycling must be considered. Such alternatives should not be
screened out on the basis of cost alone. Section 300.68(h)(l) of
the NCP allows rejection of alternatives during the screening
stage based on cost, only when the cost of the alternative far
exceeds the cost of others (e.g., by an order of magnitude) and
does not provide substantially greater public health and environ-
mental benefits.
Detailed analysis of these alternatives should include
consideration of long-term effectiveness of treatment and compara-
tive long and short term costs of treatment as- compared to other
remedial alternatives. Finally, when recommending and selecting
the appropriate remedial action, treatment, reuse or recycling
may be found more protective of public health and the environment
than land disposal. Such alternatives may be recommended as the
appropriate remedial action where the detailed analysis of
alternatives shows that the alternative is more cost-effective
than others in mini-mi zing the damage to public health, welfare
or the environment. During the next six months, EPA will be
developing additional guidelines for evaluating the comparative
long-term costs of treatment and land disposal.
At this time, the Agency does not know the current and
projected treatment capacity available, nor the needs or capacity
that will be required for Superfund actions in the future. Over
the next several months, the Agency plans to undertake a study
of available treatment and interim storage capacity and needs.
Once completed, this analysis will provide information on treat-
ment facilities currently operating for Regions to use. Additional
information on capacity will be provided at a later date through
a more comprehensive capacity survey being undertaken in support
of the implementation of the 1984 RCRA amendments.
B. Requirements for selecting storage, treatment or disposal
facilities
Selection of an appropriate facility for off-site management
of hazardous substances requires that a judgment be made as
to the overall acceptability of the facility to receive the
substances and the acceptability of the unit that will receive
the hazardous substances. In making this judgment the following
steps must be observed:
1. The owner or operator of any hazardous waste management
facility unde,r consideration for off-site storage, treatment or
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actions under CERCLA or section 7003 of RCRA must have an applic-
able RCRA permit or interim status.2
2. A RCRA compliance inspection must be performed at any
hazardous waste management facility before it can receive hazardous
substances from a response action. This inspection must assess
whether there are any significant violations or other environmental
conditions that affect the satisfactory operation of the facility.
The RCRA compliance inspection must have taken place not more than
six months prior to the storage, •treatment or disposal of the
hazardous substances from a response action. If the inspection
has not taken place or is not scheduled, REM/FIT contractor
personnel may conduct the inspection under the direction of the
Deputy Project Officer, working in cooperation with RCRA Regional
personnel. If Regions use contractor personnel, the Region should
ensure that such personnel are adequately trained to conduct
inspections. Further guidance on conducting inspections when a
facility is being considered for management of hazardous substances
will be issued in the near future. The FY 85 and FY 86 RCRA Imple-
mentation Plans establish compliance monitoring and enforcement
targets. For FY 85 the guidance requires Comprehensive Ground-
Water Monitoring Evaluations (CGMEs) at one third of the ground
water monitoring facilities. Top priorities for this type of
inspection are all facilities receiving wastes from Superfund
sites .
In States with Phase I or II interim authorization or final
authorization, the inspection should -be conducted -in accordance
with State regulations or permit conditions. EPA Regions
should always involve States when undertaking an inspection
at a RCRA facility that is likely to accept Superfund wastes.
Regions must use the results from the inspection, along
with other information, to determine whether the facility is an
acceptable one.
*• Both permits and interim status apply to specific wastes and
specific storage, treatment or disposal processes. The Remedial
Project Manager (RPM) or OSC must determine that the facility's
permit or interim status includes the wastes that would be
transported to the facility and the type of process for which
wastes are being taken to the facility. Because of these
concerns, it is important that facility selection be coordinated
with RCRA personnel. However, not all CERCLA substances are
hazardous wastes under RCRA. Therefore, it is possible that a
particular permit may not cover a hazardous substance that may
be taken to the RCRA facility if it is not a hazardous waste.
Moreover, in some situations a' hazardous substance under CERCLA
may trigger disposal requirements under other laws (for example,
PCBs and some radioactive substances). In such cases the
applicable requirements of these other laws must be observed.
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3. It is EPA's policy to minimize the use of land disposal in
accordance with the direction taken by Congress in amending RCRA.
Where land disposal is used, these amendments establish new tech-
nical standards for land disposal facilities. New disposal units,
lateral expansions and replacement units (defined as of November 8,
1984) of interim status landfills and surface impoundments must
have at least two liners and a leachate detection, collection
and removal system above (in the case of landfills) and between
the liners, if they receive wastes after May 8, 1985. All Fund-
financed and enforced response actions (removal and remedial)
involving the off-site disposal of hazardous substances must involve
use of disposal facilities that are in compliance with applicable
RCRA minimum technical reqiurements. This means that units first
receiving wastes after November 8, 1984 cannot receive wastes
after May 8, 1985 if not double lined. The RCRA statute does
allow continued use of existing units after that date. In consider-
ing whether to use an existing unit that does not meet the double
liner requirements, the Agency will consider the toxicity, persis-
tence and mobility of the hazardous substances and the need to
segregate these substances from others. Such a unit can be
used only if it is shown to adequately protect public health and .
the environment.
CERCLA hazardous substances which are not hazardous wastes
under RCRA may, in some circumstances, be disposed of in other
legal units. In such cases, disposal should take place in accordance
with other legal requirements. Hazardous substances which are not
hazardous wastes may be taken to a RCRA unit under the terms out-
lined in the preceeding paragraph, or to a unit legal under other
statutory provisions (for example, PCBs may be disposed of in a
TSCA approved disposal facility and radiocative materials in a
radioactive materials disposal facility). This disposal must be
consistent with Section 104(c)(3) of CERCLA, when applicable.
4. Interim status land disposal facilities under considera-
tion for off-site disposal must have adequate ground water
monitoring data to assess whether the facility poses a threat, to
ground water.3 Due to the lack of compliance with RCRA ground
water requirements, available data may not be adequate to assess
the facility. Moreover, lack of evidence of contamination from
the monitoring data does not necessarily mean the facility is
secure. The monitoring data may be faulty. In addition, there
may be other problems at the facility such as air emissions or
surface run-off. Where doubt exists concerning the acceptability
of a facility, an on-site inspection should be undertaken to
specifically address these concerns. Where possible, this
on-site inspection should be part of the required RCRA compliance
inspection.
Al 1remai ning land disposal permit applications will be
requested in FY 1985. These applications contain summaries
of ground water monitoring data obtained during the interim
status period, and are required to identify any plume
contamination.
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5. Using information gathered from the compliance inspection,
other data sources (e.g., RCRA facility permit data), any other
facility visits and all other relevant information, Regional
Offices must evaluate and make a judgment on the acceptability of
using the facility for storage, treatment or disposal of hazardous
substances. For the facility as a whole, this evaluation should
consider whether there are any RCRA violations or other environ-
mental conditions^ at the facility which affect its satisfactory
operation. This evaluation should include consideration of
facility operations as well as whether there are physical condi-
tions at the facility that pose a significant threat to public
health, welfare or the environment. For facilities in assessment
monitoring, the conditions which lead to required assessment
monitoring, as well as resulting monitoring data,.must be evaluated
The evaluation also should consider the nature and quantity of the
substances and whether it is feasible to treat the substances prior
to land disposal to mitigate any adverse effects.
No Superfund hazardous substances shall be taken off-site to
a RCRA facility if the Region determines that the facility has
significant RCRA violations or other environmental conditions that
affect the satisfactory operation of the facility, unless
both the following conditions are met:
(1) The owner or operator must commit, through an enforce-
able agreement (i.e., consent order or decree), to
correct the problem. The agreement must be signed
before the facility may receive the hazardous
substances. In addition, the Regional Administrator
must determine that the agreement is likely to result
in correction of the problem and the owner or operator
of the facility is capable of compliance with the terms
of the agreement; and
(2) Disposal only occurs within the facility at a new or
existing unit that is in compliance with RCRA require-
ments. The new or existing unit must not contribute
in any significant way to adverse conditions at the
facility.
III. MANIFEST REQUIREMENTS
If an off-site option is chosen, a manifest for the transpor-
tation of the hazardous waste must be obtained. The manifest must
*» It is recogni zed that the RCRA regulations may not at this
time cover all environmental conditions at a facility. Regional
offices may consider other environmental factors at a facility
under consideration including other State and/or Federal
environmental laws. If a facility is in assessment monitor-
ing, the conditions which lead to assessment monitoring may
constitute environmental conditions that adversely affect
facility operations. In such cases, Regions should assess the
conditions at the facility prior to using the facility for
Superfund purp'oses.
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be in compliance with RCRA for the transportation of hazardous
wastes. The manifest must be a Uniform Hazardous Waste Manifest
in compliance with requirements at 40 CFR 262 (see 49 FR 10490,
March 20, 1984). The lead agency or other party undertaking
the cleanup must ensure that the transporter properly notifies
under RCRA section 3010. Where the lead agency allows contractors
to fill out the manifest, the agency should ensure that the
manifest is properly filed.
IV. PCB DISPOSAL REQUIREMENTS
Requirements for the disposal of PCBs are established in
40 CFR 761.60. Generally, these regulations require that whenever
disposal of PCBs are undertaken, they must be incinerated, unless
the concentrations are less than 50 ppm. If the concentrations
are between 50 and 500 ppm, the rule provides for" certain excep-
tions that provide alternatives to the incineration requirements.
The principal alternative is disposal in an EPA approved landfill
for PCBs. Landfills used for PCB disposal must be inspected
within six months prior to disposal. Regions must determine the
acceptability of the facility based on the sara-e- criteria used to
evaluate RCRA facilities in Section II.B.5.
V. IMPLEMENTATION
Beginning (30 days from date this document is signed) all
Records of Decision (RODs) and Enforcement Decision Documents .
(EDDs) for Superfund-lead and enforcement lead actions, respec-
tively, must include a discussion of compliance with these pro-
cedures for alternatives involving off-site management of Superfvind
hazardous substances at RCRA facilities. Decision documents for
removal actions also should include discussion of compliance with
these procedures. It is recognized that actual offsite facility
information will not be available at the ROD stage. However, the
RI and FS should use actual off-site facilities in costing remedial
alternatives, in order to have cost figures that are as accurate
as possible.' It is recognized that additional facilities are
likely to be considered during the bidding process. Any facility
ultimately selected for disposal, treatment or storage must meet
the requirements of this policy.
Provisions requiring compliance with these procedures must be
included in any contracts for response, cooperative agreements
with States undertaking Superfund response and all enforcement
agreements. For ongoing projects, these provisions will be
implemented as follows:
RI/FS: The Regions shall immediately notify Agency contractors
and States that 1) alternatives for off-site management
of wastes must be evaluated pursuant to the provisions
of this policy, and 2) consistent with the policy on
other environmental laws, treatment alternatives
should not be dropped during the screening stage.
RD: The Regions shall immediately notify Agency contractors,
the States, and the U.S. Army Corps of Engineers that
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-10-
all remedies that include off-site disposal of hazardous
substances must comply with the provisions of this
policy pertaining to selection of an acceptable off-site
facility.
RA: The Regions shall immediately assess the compliance
status of land disposal facilities receiving hazardous
wastes from ongoing projects. For a facility not in
compliance, the Region should take immediate steps
to bring the facility into compliance with the policy.
Enforcement: Actions currently under negotiation and all future
actions must comply with these procedures. Existing
agreements need not be amended. However, EPA reserves
the right to apply these procedures to existing
agreements, to the extent it is consistent with the
release and reopener clauses in the settlement agree-
ment (See the Interim CERCLA Settlement Policy, Part
VII; Thomas, Price, Habicht; December 5, 1984).
If the response action is proceeding under a Federal-lead,
the Regions should work with the Corps of Engineers or EPA
Contracts Officer to negotiate a contracts modification to an
existing contract, if necessary. If the response action is
proceeding under a State-lead, the Regions should amend the
cooperative agreement. Exceptions for existing contracts and
cooperative agreements may be allowed on a case-by-case basis
by the appropriate Headquarters Office Director.
All Regions must adopt procedures to implement and continual-
ly monitor compliance with these requirements. The procedures
must include designation of a management official who is respon-
sible for providing, information on RCRA facilities in the Region
to other Regions. It is the responsibility of the Region in
which the RCRA offsite facility is located to assess the accept-
ability of the facility in consultation with the Region planning to
ship wastes to the facility. The names of these officials should
be provided to the Office of Waste Programs Enforcement by May
21, 1985. These names will then be forwarded to all Regions.
If you have any questions concerning these procedures, please
contact Sylvia K. Lowrance (FTS 382-4812).
Attachments
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
A' /- ;> c K»--
—• £ c ,j x-
OFFICE OF
SOLID WASTE AND EMERGENCY RESPONSE
MEMORANDUM
SUBJECT: Community Relations Activities at Superfund
Enforcement Sites .
FROM: Gene A. Lucero, Director (yfa\& n^
Office of Waste Programs enforcement
TO: Addressees
This memorandum clarifies certain policies and procedures
Included in the March 22, 1985, Interim Final Policy on
Community Relations Activities at Superfund Enforcement Sites.
Specifically, this memo discusses:
o Public comment on Administrative Orders (AOs) on Consent
for RI/FS work (page 4, last sentence, paragraph 2 of the
Chapter);
o Public review of workplans and other site-specific
documents;
o Potentially Responsible Party (PRP) involvement in
community relations activities, and;
o Obtaining Department of Justice (DOJ) concurrence,
when appropriate, on community relations activities.
It is written In response to Regional staff questions raised
during Regional enforcement training on community relations.
Public Comment on AOs
In several places, the Enforcement Chapter discussed
requirements for public comment on Administrative Orders on
Consent for RI/FS work. There is no mandatory requirement
for such comment. This provision is Intended to allow public
comment If, in the Region's Judgment, It would benefit the
clean-up effort, not unduly delay the RI/FS and not delay or
hinder unacceptably the enforcement process. For example,
Administrative Orders on Consent to Initiate RI/FS work and
Administrative Orders for emergency actions are actions for
which public review and comment on the Administrative Order
would not likely be provided. We do think that the public
should be involved In or Informed of the decision to allow
PRPs to do the RI/FS.
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-2-
W
PI
PRP Preparation of Workplans, Public Review of Workplans,
Safety Plans and other documents related to the RI/PS
The Enforcement Chapter does not specifically address
public review of workplans, safety plans, and other documents
related to the RI/PS that are generated by PRPs pursuant to
CERCLA enforcement and reviewed and approved by EPA staff.
These documents may be made available for public review In
accordance with guidance established In the community relations
handbook. The Enforcement Chapter provides guidance on
community relations for an enforcement RI/PS, so use that
guidance for PRP RI/PS. (See Section D on page 7 of the
Enforcement Chapter.)
Potentially Responsible Party Involvement In Community Relations
Activities "
Community Relations planning and Implementation activities
conducted at federal-lead enforcement sites are to be managed
by EPA staff. Since community relations activities serve as
the primary mechanism for communications between EPA and
the public during enforcement actions, we do not foresee
circumstances where it would be appropriate to allow PRPs to
manage these activities.
EPA must maintain the lead and accountability for the
development and implementation of community relations
activities. PRPs may participate in public meetings and
they may prepare fact sheets. However, these fact sheets
are to be reviewed and approved by EPA staff for accuracy
and to ensure adherence to our policies and procedures.
Agency personnel should avoid "negotiating" these documents
with PRPs. Agency personnel are accountable for the content
of the fact sheet and its distribution. The Region should
be selective in allowing PRPs to develop fact sheets. In
addition Regional personnel should acknowledge on the fact
sheet that it was prepared by the PRP.
If the Region decides to provide a draft community
relations plan to the PRP and the public for review, the
document must be provided to all interested parties at the
same time. Comments may be Incorporated when you believe
they are Justified.
DOJ Concurrence
The last issue concerns DOJ or the Assistant U.S.
Attorney (AUSA) concurrence on fact sheets, press releases
and community relations plans when a site has been referred
or Is likely to be referred for litigation. The Chapter
states that Regional Superfund Community Relations Coordinators
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-3-
wlll be responsible for coordination with the Department of
Justice on development of these documents.
Ve have discussed this concurrence process with DOJ.
EPA and DOJ agree that the Office of Regional Counsel staff
should be the contact point between the Superfund Community
Relations Coordinator and DOJ or the AUSA staff.
Community relations activities at EPA-lead enforcement
sites require close coordination between ORC, Technical
Superfund staff and the Community Relations Coordinators.
I appreciate your hard work in this area and will be
ensuring that our HQ staff provide you with necessary
guidance. Please call Ms. Pamela A. Qarrow of my staff
(475-8112) if you have any questions.
Addressees
Director, Waste Management Division, Regions I, IV, V, VII, VIII
Director, Emergency And Remedial Response, Region II
Director, Hazardous Waste Management Division, Region III
Director, Air & Waste Management Division, Region VI
Director, Toxics & Waste Management Division, Region IX
Dlrecctor, Hazardous Waste Division, Region X
cc: Regional Superfund Community Relations Coordinators, Regions I-X
Regional Counsel, Regions I-X
Bill Hedeman, Director, Office of Emergency and Remedial Response
Susan Bullard, OSWER Community Relations Coordinator
OWPE Supervisory Staff
Fred Stlehl, Office of Enforcement and Compliance Monitoring
Steve Lelfer, Office of Enforcement and Compliance Monitoring
Jerry Schwartz, Office of Enforcement and Compliance Monitoring
Nancy Firestone, Department of Justice
Daphne Gemmlll, Superfund Community Relations, OERR
Mat White, Office of Public Affairs
Removal and Remedial Branch Chiefs, Regions I-X
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Procedures Manual
-------
3 •< - 3
20 -~-
MEMORANDUM
SUBJECT: Procedures for Documenting Costs for CERCLA $107 Actions
PROM: Gene A. Lucero, Director (3fyflji
Office of Waste Programs Enforcement
TO:
I - 'X
IX
Directors, Air & Waste Management Divisions, Regions j. -
Regional Counsel, Regions I - X
Director, Administrative Services Divisions, Regions I,
Assistant Regional Administrators for Policy Management,
Regions II, III, IV, VII, and VIII
Director, Policy and Management Division, Region V
Director, Management Division, Region X
This memorandum sets forth the procedures for documenting
costs for CERCLA 5107 cost recovery actions. These procedures
require the close cooperation and coordination among Headquarters
and Regional program, legal, and financial offices. The attached
procedures should be used in conjunction with the Case Development
Handbook. The Procedures Manual addresses the following
topics:
0 Categories of Expenditures
0 Inventory of Site Related Costs
0 Regional and Headquarters Documentation Process
0 Privacy Act/Confidential Business Information
0 Bankruptcy Procedures
Additional guidance is being developed for several other
issues associated with cost recovery which are not addressed
in the attached Procedures Manual. These issues include:
providing cost documentation of state and other Federal
agencies' Superfund expenditures, streamlined documentation
procedures for the issuance of demand letters, application of
interest and procedures for small cases.
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-2-
It is the Agency's intention that some type of action is
taken to recover expenses for every site where Fund monies have
been expended. The Agency plans to have all cases dealt with
in a timely and efficient manner. Guidance is being prepared
that will provide criteria for more streamlined settlement
arrangements for small cost recovery cases.
The Agency recognizes that the attached Procedures Manual
does not necessarily represent the best and final system for
cost recovery documentation. Over the coming months, with the
initiatives outlined above, the Agency will be working to
provide £ more efficient cost recovery process. Any suggestions
for improvement to the cost recovery process will be appreciated,
Over the next several months, seminars will be held in
each Regional office on the Procedures Manual and other
issues associated with cost recovery. If you have any
questions regarding the manual, please contact Janet Farella,
382-2016.
cc: William Hedeman, OERR
Dave Buente, DOJ
Fred Stiehl, OECM
Dave O'Connor, PCMD
Gordon Takeshita, FMD
Peter Cook, OWPE
Jack Stanton, OWPE
375
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PROCEDURES FOR DOCUMENTING COSTS
FOR
CERCLA §107 ACTIONS
376
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TABLE OF CONTENTS
PAGE
INTRODUCTION 1
I. CATEGORIES OF EXPENDITURES 4
II. CASE SELECTION AND PRIORITIES 9
III. INVENTORY OF SITE RELATED COSTS . . .11
IV. COST DOCUMENTATION PROCESS 14
Regional Responsibilities 15
Financial Management Responsibilities .... .18
Waste Programs Enforcement Responsibilities. . . 21
Department of Justice Responsibilities 27
V. PRIVACY ACT/CONFIDENTIAL BUSINESS INFORMATION . . 29
VI. APPLICATION OF INTEREST 34
VII. BANKRUPTCY PROCEDURES 35
VIII. UPDATING OF COSTS 38
IX. PAYMENT INTO THE TRUST FUND 40
APPENDICES
APPENDIX A: FLOW CHART OF COST DOCUMENTATION PROCESS
APPENDIX B: SITE SPECIFIC SPUR CHARGES
APPENDIX C: DESCRIPTION OF SUPERFUND CONTRACTS
APPENDIX D: COST RECOVERY CHECKLIST
APPENDIX E: SAMPLE CASE COST SUMMARY
APPENDIX F: INFORMATION COVERED BY THE PRIVACY ACT
APPENDIX G: SAMPLE STIPULATION/PROTECTIVE ORDER
APPENDIX H: MODEL CONFIDENTIAL BUSINESS INFORMATION LETTER
APPENDIX I: EXAMPLE MOTION FOR PROTECTIVE ORDER
377
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PROCEDURES FOR DOCUMENTING COSTS FOR CERCLA S107 ACTIONS
INTRODUCTION
The Comprehensive Environmental Response, Compensation and
Liability Act of 1980 (CERCLA) authorizes the Federal Government
to seek reimbursement from liable parties of "all costs of
removal or remedial action incurred by the United States
government." One of the Agency's goals in the Superfund program
is to maximize, through CERCLA $107 actions, reimbursement of
the Trust Fund. In August 1983, the office of Enforcement and
Compliance Monitoring, together with the Office of Waste Programs
Enforcement, issued a guidance document entitled "Cost Recovery
Actions under CERCLA." That document, hereafter referred to as
the Cost Recovery Guidance, discusses general policy issues
relating to cost recovery actions under 5107(a)(4)(A) of CERCLA.
The guidance describes the United States burden of proof for cost
recovery actions to consist of three elements:
1. Proof of a release or threat of a release of a hazardous
substance.
2. Proof of the liability of the responsible parties.
3. Proof of expenditures.
The Cost Recovery Guidance provided assistance for the
compilation of documentation to support the first two elements
378
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of a §107 action. This manual addresses the documentation that
should be collected to support the third element, expenditures,
and the procedures which are to be followed for the collection
and packaging of those documents.
The Assistant Administrator for the Office of Solid Waste
and Emergency Response serves as the primary manager of the Trust
Fund. As the primary Fund manager, the Assistant Administrator
is responsible for authorizing and obligating the majority of
expenditures from the Trust Fund. (Other Assistant Administrators
and other federal agencies are given their own Superfund allowances.)
The actual accounting of all obligations and disbursements of
Fund monies is the responsibility of the Financial Management
Division (FMD). FMD tracks Superfund expenditures through its
computerized Financial Management System (FMS), which tracks
obligations and disbursements. The FMS tracks certain expenditures
site-specifically (See Appendix B). FMS can produce site-
specific cost reports which summarize the FMS site-specific
obligations and disbursements through the use of the Software
Package for Unique Reports (SPUR) (See Appendix B) . FMS
also tracks all other charges to CERCLA accounts.
The remainder of these procedures provides the following
information:
0 Lists of categories of expenditures that might be incurred
at a site.
0 Lists of categories of site specific costs for review at
particular sites.
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0 Describes Headquarters and Regional responsibilities
for documenting costs.
• Sets forth procedures for assuring protection of information
under the Privacy Act and confidential business information
considerations.
• Describes the process for determining the proper amount
of interest on Trust Fund expenditures.
0 Describes arrangements for the collection of payments into
the Trust Fund.
The following procedures are to be used by case development
teams, in cooperation with the Office of Waste Programs Enforcement
and Financial Management offices, when initiating and prosecuting
a CERCLA $107(a){4)(A) cost recovery action. Conformance with
these procedures will assure timely and complete documentation
of costs for 5107 actions.
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I. CATEGORIES OF EXPENDITURES
Although the list of possible individual cost categories
under Superfund is a large one, expenditures can be divided
into four broad categories:
EPA In House Expenditures
Contracts
Other Federal Agencies (Interagency agreements)
States (Cooperative Agreements)
The following section will briefly outline how these four
categories of cost are accounted for by FMD.
EPA In-House Expenditures
This category includes all EPA employees whose salaries
(either fully or in part) are paid out of the Superfund account.
Employee time may be charged generically to the program* or
specifically to a site. Site-specific payroll charges are included
in the site specific SPUR reports. This category also includes
all EPA travel charged to the Superfund account. Like payroll,
travel may be charged to non-site-specific or site-specific
accounts. Also included in this category of cost are supplies,
I/The Financial Management Division (FMD) is implementing an
indirect cost allocation system that will allocate appropriate
Agency and program support costs for sites. This system will
be run centrally by the Financial Reports and Analysis Branch
of FMD and will not be reflected in the FMS or SPUR reports.
Amounts to be claimed for cost recovery purposes should be
available during FY 85.
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equipment, training or other miscellaneous charges made by EPA
offices which may be charged site-specifically in certain circum-
stances. All costs charged to site-specific accounts are
identified as direct costs in the site-specific SPUR reports.
Contracts^
This category includes all contracts which are obligated
against the Superfund appropriation. Contracts can be subdivided
into three groups:
1.•• Program Support Contracts
These contracts, as the name suggests, provide generic, non-
si te-speci fie program management support. Development of program
activity tracking systems is an example of the type of work
tasked under a program support contract. These contracts are
tracked in FMS under non-site-specific accounts.
2. Site Specific Contracts
This category includes On Scene Coordinator Emergency
Removal Contracts, the Emergency Response Cleanup Services Contracts,
the Remedial portion of the REMEDIAL ACTION/FIELD INVESTIGATION
TEAM (REM/FIT) contracts and the REMEDIAL ACTION II contract.
Work under these contracts is tasked and invoiced site-
specifically and the contract costs are recorded site-specifically
in the FMS .
VPlease see Appendix C for a more detailed description of
Superfund contracts.
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3. Direct Site/Non-Site-Specific Contracts
This category includes Superfund contracts which provide
direct site response work but are not accounted for site
specifically in the FMS. This category includes the following
contracts: Technical Assistance Team (TAT) Contract, Technical
Enforcement Support (TES) Contract, FIT portion of the REM/FIT,
Contract Lab Program (CLP) Contracts, Environmental Monitoring and
Systems Laboratory (EMSL) Contract, National Enforcement Investigation
Center (NEIC) Contract .and the Environmental Emergency Response
Unit (EERU) Contract. These contracts are invoiced monthly
for all work performed under the contract during that month.
The contractors do maintain records of site-specific work
performed under these contracts. For cost recovery actions,
the contractors will be requested (by OWPE through the appropriate
contract project officer) to supply site-specific cost summaries
and documentation.
In general,,all three types of contracts are processed and
paid in the following manner. Invoices from the contractor
are reviewed and approved by the project officer. Invoices
are then forwarded to the Financial Management Office in Research
Triangle Park, NC., which processes the payment of all Superfund
contracts. This office prepares a Treasury Schedule which
authorizes payment and indicates the contractor, contract
number and amount of payment for a particular invoice.
383
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Other Federal Agencies
Under interagency agreements (TAG), other federal agencies
perform various activities and services in support of the
Superfund program. There are two mechanisms available for IAG
funding: reimbursement and transfer allocations. Through lAGs,
other federal agencies may provide either general program support
or site-specific activities.
With reimbursement accounts, other federal agencies will
perform certain services for the Superfund program (general program
or site-specific) and request reimbursement for .the services after
they are performed. Money is obligated for these lAGs before
work is performed but disbursed after the work is completed. Site-
specific reimbursable lAGs are accounted for site-specifically
in the FMS. Reimbursable lAGs are processed through the
Financial Management Office in Cincinnati, OH. Vouchers for
reimbursement are approved by the project officer and forwarded
to Cincinnati for processing. The Cincinnati office directs
the U. S. Treasury to transfer the approved vouchered amounts
from the Superfund account into the other agency's account.
Under transfer allocations, Superfund money is transfered
to another agency before services are rendered. Transfer
allocations, either generic or site-specific, are not accounted
for in the FMS. However, under transfer allocations, the receiving
Federal agency provides a monthly accounting to OCRR and FMD
of expenditures to date. These monthly reports serve as the
384
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basis for cost documentation of site-specific transfer allocations
Further guidance on the back-op documentation to be supplied by
other Federal agencies will be provided in the near future.
States
This category includes monies spent through Superfund
State Cooperative Agreements. Generally cooperative agreements
are entered into between EPA and a state for site-specific
activity (e.g. removal action, RI/FS, remedial construction
and design). In April 1984, the Regions were delegated the
authority to enter into cooperative agreements with states.
Under a cooperative agreement, the agreed upon amount of money
is set aside for drawdown by the state under a letter of credit.
The state must then report its record of expenditures to EPA when
a drawdown on the account is made.. The Regional Financial
Management Offices maintain a record of the drawdown of the
accounts. Further guidance on the procedures to be used with
regard to cost recovery of cooperative agreement monies will be
provided in the near future.
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II. CASE SELECTION AND PRIORITIES
The Cost Recovery Guidance addresses the process of
initial selection of a case for cost recovery action. In an
effort to maximize return to the Fund and to promote efficient
use of its resources, the Agency has set as its priority for
new referrals those cases where:
1. Costs incurred exceed $200,000 and,
2. Site response action (either removal or remedial action)
is completed, or, in the case of remedial actions, the
Trust Fund's involvement has been completed.
Particular cases for referral are identified in the
Superfund Comprehensive Accomplishments Plan (SCAP). Because
of the complex and agency-wide nature of cost documentation
collection, EPA Headquarters (i .e. OWPE) plays a major role.
OWPE will rely on the SCAP for $107(a)(A) case priorities for
cost documentation collection. Since document collection and
packaging is a time consuming process, the Regions must allow
for at least six weeks between an initial request for documents
and their receipt. If Regional cost recovery case priorities
change after the submission of the SCAP to Headquarters, the
Region must submit changes to OWPE in writing. Complete collection
of cost documents for those cases involved in priority changes
cannot be guaranteed if the change request is received after
the third week of the quarter in which the Region is planning
to refer the case.
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As indicated in the bankruptcy section below, however,
OWPE will make every effort to ensure that ost documentation
for purposes of submitting a proof of claim is gathered on a
timely basis.
Generally, before a cost recovery case is referred to
Headquarters or DOJ, and certainly before a case is filed,
demand letters are sent to the responsible parties. At the
present time the same cost documentation procedures are to be
used for the issuance of demand letters as for case referrals.
In the interest of maximizing the timely recovery of funds, the
Agency intends to establish a more streamlined process for
documenting costs for the issuance of demand letters. Demand
letters should be considered for every response action where
there is at least one viable responsible party and should be
sent as soon as practicable after the completion of the response
action. The Agency intends to issue more detailed guidance on
the demand letter process and model demand letters in the near
future.
Another category of cases requiring cost documentation is
those sites where negotiations are projected or underway and
cost recovery provisions are included under a consent decree or
consent administrative order. These sites are to be identified
on a quarterly basis and indicated under the negotiations or
administrative enforcement section of the SCAP. Cost document
collection procedures are identical for new referrals and cases
under negotiation.
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III. INVENTORY OF SITE RELATED COSTS
Since site response activity under CEPCLA can be very
complex and require the assistance of various EPA offices,
contractors, states and other federal agencies, some method of
organizing site activities and expenditures must be utilized.
Therefore, the Regions, which have primary responsibility for
directing site activity, should establish a file that records
all work as it is requested and conducted. The first step in
documenting site expenditures is to take an inventory of all
activities that have occurred both at the site and in support of
site activity. These site related expenditures may have been
incurred by at least the following:
1. EPA Headquarters personnel:
Office of Emergency and Remedial Response (OERR)
Office of Waste Programs Enforcement (OWPE)
Office of Enforcement and Compliance Monitoring (OECM)
Office of General Counsel (OGC)
Emergency Response Team (ERT)
National Enforcement Investigation Center (NEIC)
Environmental Monitoring Systems Laboratory (EMSL)
Environmental Photographic Interpretation Center (EPIC)
2. EPA Regional Offices:
Air and Waste Management Divisions
Emergency Response Divisions
Office of Regional Counsel
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Regional Laboratories
Office of Public Affairs, Congressional/Intergovernmental Liaison
3. Contractors:
REMEDIAL/FIELD INVESTIGATION TEAM Contract (REM/FIT)
REMEDIAL CONTRACT (REM II)
TECHNICAL ASSISTANCE TEAM CONTRACT (TAT)
EMERGENCY REMOVAL CLEANUP SERVICES CONTRACT (ERGS)
ON SCENE COORDINATOR CONTRACT (OSC)
CONTRACT LABORATORY PROGRAM CONTRACT (CLP)
TECHNICAL ENFORCEMENT SUPPORT CONTRACT (TES I and II)
ENVIRONMENTAL EMERGENCY RESPONSE TEAM CONTRACT
NATIONAL ENFORCEMENT INVESTIGATION CENTER CONTRACTS
OVERFLIGHT CONTRACT with LEMSCO
OTHER. MISCELLANEOUS CONTRACTS
4. States:
Cooperative Agreements
5. Inter-Agency Agreements with other Federal Agencies:
Corps of Engineers (COE)
Coast Guard (USCG)
Department of Justice (DOJ)
Department of the Interior (DOI)
Federal Emergency Management Agency (FEMA)
National Oceanic and Atmospheric Agency (NOAA)
Health and Human Services (HHS)
Occupational Health and Safety Administration (OSHA)
389
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It should be noted that site related expenditures may be
incurred by the Criminal Enforcement Division of OECM as well
as the criminal investigators associated with MEIC. The costs
incurred by these personnel should not be included in costs the
Agency is seeking to recover and all reference to these
individuals and their offices should be removed from the SPUR
and other documentation. If any guestions arise on this issue
please contact Carroll Wills of NEIC, FTS-234-215P.
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IV. COST DOCUMENTATION PROCESS
The case development team's first task in §107 cost
documentation is to fill out a Cost Pecovery Checklist (See
Appendix D). To assure successful documentation, it is
imperative that the checklist be accurate and complete. The
checklist serves as the basis for all cost document collection.
Incomplete checklists will not be processed and will be returned
to the Region for completion. For new §107 case referrals,
the checklist should be completed and sent to OWPE allowing
at least six weeks for document collection. The checklist
should also be delivered to the appropriate Regional office
with responsibility for compiling Regional costs and documents;
This will help ensure that all cost documentation will be completed
on a timely basis. This timing assumes that demand letters
will be sent simultaneously with the referral to Headquarters.
Cost documentation should be complete before issuing a demand
letter3 or referring the case to Headguarters. If the Reaions
wish to receive the cost documents earlier, for demand letter
purposes, they must submit the completed checklists earlier.
Completed checklists should be sent to:
Barbara Grimm
Office of Waste Programs Enforcement
WH-527
U.S. EPA
401 M. Street
Washington, O.C. 20460
-*/The authority to issue demand letters on cases before referral
to the Department of Justice was delegated to the Regional
Administractors in March 1984. Please see Appendix J for a copy of
the delegation memorandum. Once a case is referred, demand letters
are to be sent by the DOJ attorneys.
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Documentation Collection Responsibilities
Successful documentation of costs for $107 cases will
require the close cooperation and coordination of Superfund
legal, program, enforcement, and financial offices both in the
Regions and in Headquarters and with Justice Department attorneys
Each of these offices will have certain responsibilities in the
collection and packaging of cost documentation.
1. Regional Responsibilities
A Regional member of the case development team should be
selected to coordinate the Regional and Headquarters cost
documentation. That team member must work with the Regional
Financial Management Office to successfully complete
Regional cost documentation responsibilities. The case
development team member will be responsible for completing
the checklist and collecting, packaging and summarizing4 the
following categories of costs:
a. State Cooperative Agreement;
Documentation: SPUR
Copy of Cooperative Agreement
Copy of letter of credit and record of
drawdown.
4/See Appendix E for copy of a sample summary.
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Summary of Cooperative Agreement: Includes date of
agreement, brief description of work,
name of state, total amount of agreement,
and if not completed at time of
documentation, amount spent to date.
Note: Additional backup documentation will be reguired from the
states. Guidance on the appropriate documentation and the method
for obtaining it will be issued at a later date.
b. Regional Payroll; This includes site-specific payroll
charges by any Regional employee^,
including Regional Lab employees.
Documentation: SPUR
Employee Timesheets and Timecards
/"
Summary of Payroll: Includes employee name, title,
number of hours charged to site,
The regions must review the timesheets against the timecards
and the SPUR, note ;and notify FMD to correct any inaccuracies.
The timesheets are the original record of site-soecific payroll
charges and should be considered as the basis for payroll
documentation.
5/Criminal investigators performing site-specific work may
charge their payroll against the Superfund site-specific account
Employee information and amounts charged to the site should be
deleted from the cost recovery documentation.
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c. Regional Travel: This includes site specific travel
charges by any regional employee.
Documentation: SPUR
Employee travel authorization, paid travel
vouchers and any corresponding treasury
schedules.
Summary of Travel: Includes employee name, title,
dates of travel, dollars charged
per trip.
The Regions must review the travel documentation against
the SPUR, and notify FMO to correct any inaccuracies. The approved
and paid travel vouchers serve as the basis for travel documentation,
d. Other Regional Direct Costs; This includes site-specific
supplies or services which
may be purchased by a Region
under its individual allowance.
These charges may appear
on the SPUR.
Documentation: SPUR
Purchase Orders
Summary: Includes description of other direct site
expenditures, dates of expenditures and amounts.
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2. Financial Management Division Responsibilities
Upon receipt of a completed checklist, OWPE will reauest
FMD to provide documentation for site-specific charges included
in the Financial Management System (except for the Regional
documentation listed above). Documentation collected by FMD will
be submitted to OWPE. The FMD documentation covers the
following categories of costs:
a. Site-Specific Contracts; This includes OSC contracts,
ERGS contracts, REM portion of the
REM/FIT Contracts, REM II Contract
Documentation: SPUR
Copies of paid invoices
Copies of Contract Status Notifications
Copies of corresponding treasury schedules
FMD must reconcile the paid invoices against the SPUR and
note and correct any inaccuracies.
b. Inter-Agency Agreements (IAG); Includes site-specific
reimburseable and transfer
allocations as reouested by
nwPE
Documentation: SPUR
Copy of the IAO
Copy of vouchers and schedule of withdrawals
Copy of monthly status renort for transfer
allocations.
Note: Additional backup documentation may be reguired from other
federal agencies. Guidance on documents reguired and procedures
395
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for collection is currently under development.
c. Contract Laboratory Program Contract (CLP): This includes
all standard analytical services provided by
the CLP. It does not include the Contract
Lab Manaqenent Contract (see next section).
Documentation: After receipt of a site-specific invoice
list from OWPE, FMD will supply the contract
lab invoices and corresponding Treasury
Schedules ans contract status notifications.
d. Other Superfund[ Contracts; This includes site-specific work
contracted under Superfund that is
not invoiced site-specifically.
Documentation: On a quarterly basis, FMD will supply
to OVJPR an update of copies of the
invoices, contract status notifications
and treasury schedules for the following
contracts:
TAT
(Current contractor: Roy F. Weston
Contract No. 68-01-6669)
FIT portion of REM/FIT
(Current Contractors: NUS,
.CH2MHill: FIT Subcontractor: E & E
Contract Nos. 68-01-6699, 68-01-6692)
TES I
(Current Contractor: GCA
Contract No. 68-01-6769)
TES II
(Current Contractor: PRC
Contract No. 6R-01-7037)
396
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CLP Management
(Current Contractor: VIAR
Contract No. 68-01-6702)
EERU Contract
(Current Contractor: IT Corp.
Contract No. 68-03-3069)
EMSL Contract
(Current Contractor: LEMSCO
Contract No. 68-03-3049)
NEIC CONTRACT
(Current Contractor: TECH LAW
Contract No. 68-01-6838)
e. Headquarters Payroll; This includes site-specific payroll
charqes by any headquarters employee
(OWPE, OERR, OECM, ERT, etc.)
Documentation: SPUR
Timecards
f. Headquarters Travel; This includes site specific travel
M^••^^^^^•^••••^•B /
charges by any Headquarters employee.
Documentation: SPUR
Copies of travel authorizations
Copies of paid travel vouchers and any
corresponding Treasury Schedules.
FMD must review the travel documentation aqainst the SPUR
and note and correct any inaccuracies. The approved travel
vouchers serve as the basis for travel documentation.
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3. OWPE Responsibilities
OWPE plays the major role in requesting case cost
documentation, tracking receipt of documents, and packaging and
summarizing of cost documents. OWPE will be responsible for
the following cost-documentation:
a. FIT Contract Costs: Includes site-specific costs incurred under
the Field Investigation Team contracts,
which are part of the REM/FIT contracts.
Documentation: OWPE will reguest the FIT contractors
to provide a summary of site-specific costs
incurred under the contract. The summary
will include: total costs, break out of
costs by labor, travel, subcontractors,
and materials, TDD numbers and associated
hours, dates of work and brief summary
of work performed. OWPE will provide
copies of TDOs, invoices, contract status
notifications and corresponding Treasury
Schedules for dates of work.
b. TAT Contract Costs; Includes all site-specific cost incurred
under the Technical Assistance Team
contracts.
Documentation: OWPE will reguest the TAT contractors
to provide a summary of site-specific
costs incurred under the contract.
Summary will include total costs,
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break out of costs by labor, travel,
subcontractors, equipment, TDD numbers
and associated hours, dates of work
and brief summary of work. OWPE will
provide copies of TDDs, invoices, contract
status notifications and corresponding
Treasury Schedules for dates of work.
c. Remedial Contract Costs; Includes all work done under the
REM portion of the REM/FIT contracts
and the REM II Contract.
Documentation: Although most of the work tasked under
these contracts are recorded site-specifically
in FMS, there is some site-specific work
which is not., This work includes: RAMPS,
community relations work, enforcement support
and laboratory work. OWPE will request
the REM contractors to supply a summary
of all direct site response work tasked
under the contract.
Documentation: Summary will include total costs,
breakout of costs by labor, travel, sub-
contractors and equipment, work assignment
numbers and associated hours, dates of
work and brief summary of work. OWPE
will provide copies of paid invoices,
contract status notifications and
corresponding Treasury Schedules.
399
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d. Contract Lab Program Costs: This includes all site-
specific costs incurred under the CLP;
both special analytical services
and standard lab analyses.
Documentation: The operation of the sample management
office is contracted to VIAR, Inc.
OWPE will request VIAR to provide a
listing and summary of all samples
and analytical services for a site.
The summary will include total CLP
costs and break out between special
analytical services and standard services.
The listing of samples will include
contract name and number, sample number,
invoice number and cost per sample. VIAR
will provide, for special analytical services,
'• copies of the paid invoices. OWPE
will provide copies, requested from
FMD, of the standard services invoices
and VIAR paid invoices, contract status
notifications and Treasury Schedules.
e. TES Contract Costs: This includes all site-specific costs
incurred under the TES contracts.
Documentation: OWPE will request the contractor to
provide a summary of site-specific work
conducted under the contract. Summary will
400
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include total costs, break out of
costs by labor, travel, subcontractors,
equipment, work assignment numbers and
associated hours, dates of work and brief
description of work performed. OWPE
will provide copies of the work assignments,
paid contract invoices, contract status
notifications and Treasury Schedules.
f. EERU Contract; This includes all site-specific work
provided under EERUs contract.
Documentation: OWPE will request FRT to provide a
summary of site-specific work provided.
under the contract. The summary will
include total site costs, dates of work,
brief description of work, break out of
costs by labor, travel and subcontractors.
OWPE will provide copies of paid invoices,
contract status notifications and
Treasury Schedules.
g. NEIC Costs; This includes site-specific work done throuqh
NEIC., both NEIC employees and .contractors
Documentation: OWPE will request NEIC to provide
site-specific employee timesheets and
travel'documentation and a cost summary
which is to include cost break out by
employee payroll and travel, contractor
401
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costs, contractor and contract number,
brief summary of work and dates of work.
If contractor was used, OWPE will supply
copy of paid invoices, contract status
notifications and corresponding
Treasury Schedules for period of work.
h. Overflights; Includes site-specific aerial photography and
related work done through EMSL and EPIC.
Documentation: OWPE will request EMSL and EPIC to provide-
summary of site specific aerial photographic
costs which is to include break out by labor
and materials, contractor costs, contract
number and dates of work. If contractor
was used, OWPE will supply copies of paid
invoices and corresponding Treasury Schedules
for period of work.
i. Headquarters Payroll: This includes site-specific payroll
*
charges bv any Headquarters employee
including OWPE, OECM, ERT, and OERR.
Documentation: SPUR from FMO
Employee Timesheets (OWPE will request
other headquarters offices to supply
their employees' timesheets).
Summary of HO Payroll: Includes Employee name, title,
number of hours charqed, total
payroll dollars per employee
402
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OWPE must review the timesheets against the SPUR note and
have corrected any inaccuracies. The timesheets are the oriainal
record of site-specific payroll charges and should be considered
the basis for payroll documentation.
j. Headquarters Travel; Includes site-specific travel
charaes by any HO employee.
Documentation: To be supplied by FMD.
Summary: Includes employee name, title, dates of travel
dollars charged per trip.
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4. DOJ Responsibilities
This includes all site-specific litigation support costs
incurred by the Department of Justice under Superfund interaqency
agreements.
Documentation: The DOJ representative on the Case
Development Team is responsible for
collecting and summarizing DOJ litigation
support costs. Documentation should include
employee tiraesheets, travel authorizations
and vouchers. A copy of the summary for DOJ
costs should be sent to OWPE.
404
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PREPARATION AND USE OF THE COST PACKAGE
OWPE will prepare a standard summary for each of the
categories of costs for which it is responsible.
After collection and preparation of the cost summary, OWPE
will send the cost documents and copy of the summary to the
Regional cost recovery case coordinator. The regional coordinator
is responsible for adding the regional cost documents and
summaries to the package. The regional coordinator is to send
a copy of the regional summaries to OWPE. The case development
team should review the cost package and make sure it is complete
and accurate. The actual cost documents are to be retained in
the regional offices. The custodian of the case file will be
the lead regional counsel assigned to the case.
After receipt of the cost documents, the case development
team can complete the referral packaae and refer the case to
OECM. The actual cost documents do not need to be sent with
the referral package; the completed cost summary will be
sufficient for case referral. The documents are to be retained
in the Regional offices to facilitate discovery or production
of documents requests and reduce possible loss of documents
through multiple shipments between headcruarters, DOJ and the
Regions.
405
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V. THE PRIVACY ACT, NON DISCLOSURE OF IRRELEVANT INFORMATION AND
CONFIDENTIAL BUSINESS INFORMATION (CBI) ISSUES
1. Privacy Act
Discovery requests and proof of the prima facie case during
CERCLA Section 167 cost recovery actions may require the Agency
to produce to responsible parties certain documents involving
EPA payroll and travel costs. That documentation may contain
information that is covered under the Privacy Act (5 U.S.C.
§522a (1974)) and should not be released until the documents
are reviewed and such information is deleted. The issue
typically arises in documents that couple an employee's name
with his social security number, employee home telephone number
or address, or where the documents are receipts containing
credit card numbers or copies of personal bank checks.
-V
The Regional offices are responsible for the review of EPA
Regional payroll and travel documents for Privacy Act
considerations. OWPE will be responsible for reviewing all
Headquarters employee payroll and travel documents. If any
information covered under the Privacy Act is found, it is to be
redacted.
Appendix F contains a list of the items covered by the
Privacy Act that should be redacted on each type of cost
documentation that may be used during a cost recovery case.
Additional inquiries regarding Privacy Act considerations should
be directed to Rose Arnold (OGC) at 382-5460.
406
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2. Non-Disclosure of Irrelevant Information
In addition to Privacy Act considerations, any references
to work performed on other CERCLA sites or RCRA facilities
should be redacted. This type of information may appear on
timesheets, timecards, or travel authorizations/vouchers.
This will prevent responsible parties from obtaining information
about other sites where investigations or other EPA activities
are underway.
3. Confidential Business Information
Documents needed to support contractor costs may contain
information, such as contractor overhead rates, which is subject
to confidential business information (CBI) considerations.
This is primarily an issue for the FIT, TAT and REM contracts,
and it will arise during the discovery phase of litigation
when defendants file a request for the production of documents.
The regulations governing confidentiality of business
information are contained in 40 C.F.R. S52 .201-2 .215 . In
general, those regulations state that CBI is entitled to be
withheld from disclosure. However, $2.209(d) allows CBI to be
disclosed "in a manner and to the extent ordered to be disclosed
by a Federal court" so long as EPA provides "as much advance
notice as possible to each affected business of the type of
information to be disclosed and to whom it is disclosed. . ."
It is important to know that EPA must respond to defendants'
discovery requests on a timely basis. Ordinarily this is within
thirty days of the request under the Federal Rules of Civil
407
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Procedure. Thus, expeditious handling of requests concerning CBI
is essential.
Procedurally, once a request for the production of documents
is received that may require CBI to be disclosed/ the lead EPA/DOJ
attorney on the litigation team should immediately contact counsel
for the party requesting the documents to determine if an
agreement can be reached in which the documents are released
under the terms of a stipulation and protective order (See
example stipulation and protective order in Appendix G). If
an agreement can be reached within the time for response
guaranteeing that the documents will only be disclosed to
certain persons or parties for certain limited purposes (and
those persons or parties agree to sign a confidentiality agreement),
the case development team must then identify all contractors
that may have CBI in the cost documentation files. Within
seven days of receipt of the discovery request, the lead EPA
attorney should send each contractor both a letter explaining
the situation (See model letter in Appendix H) and a copy of
the stipulation and protective order previously agreed to by
the parties. The letter should set a date by which the documents
will be produced (i.e., the discovery response date) and invite
the contractor to make comments on the content of the protective
408
-------
order to the author within seven days of receipt.6
Once mutually satisfactory revisions are included or the
date passes for comment, the proposed stipulation and protective
order should be submitted for signature to the party requesting
the information and, subsequently, by motion to the court
requesting entry of the Order. See example motion in Appendix I
Once the Order is entered and counsel for the party requesting
the information has executed a confidentiality agreement, the
information may be produced.
If the party requesting the information does not agree
to production under the terms of a protective order, the United
States has two options. The case litigation team may decide to
redact all CBI and produce the materials requested or it may
decline to produce the CBI-containing documents altogether
unless under the terms of a protective order.
The decision whether to redact and produce, or simply
decline to produce, will be made on a case by case basis and
will depend on the strength of the CBI claim made by the
°/It should be noted that the Office of General Counsel has been
requested to notify the major Superfund contractors that certain
types of documents containing CBI will be released in the
context of cost recovery litigation or settlement negotiations.
That notification will indicate that the United States
will attempt to protect the documents from distribution and
will include a copy of the model protective order contained in
Appendix G. The Agency expects to receive general approval of
the model protective order's terms from each of the major
contractors in the near future, thereby speeding case-specific
release of the contractors' documents.
409
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person requesting confidentiality, on the number of documents
that are involved, the resources required to review and redact
all CBI and the team's assessment of the possible consequences
of the available options. In particular, the litigation team
should consider^whether the defendants would likely accept
redacted material and the amount of resources that would be
required to oppose any motions to compel discovery in the.
event all the material is withheld.
For further information on the procedures to be followed
in addressing the issue of confidential business information,
contact David Van Slyke in the Office of Enforcement and
Compliance Monitoring at (FTS) 382-3082.
410
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VI . APPLICATION OF INTEREST
The Agency has determined that the United States should
seek interest on monies expended from the Trust Fund for, among
other things, site investigations, studies, cleanup and
enforcement. Cost recovery actions should seek interest
from the date of a demand of a sum certain at the rate being
earned by the Fund for comparable time periods.7 Applying
interest from the date of a demand is an incentive for responsible
parties to. undertake cleanup themselves and will also discourage
responsible parties from engaging in protracted negotiations
and litigation. OWPE and OECM -are presently working with the
Financial Management Division to provide site-specific
total monthly expenditures for all costs for interest calculation.
Futher guidance will be provided by DOJ and OECM on the
exact method and procedures of-interest calculation that
is to be used for cost recovery actions.
7/In a Memorandum Opinion in United States v. NEPACCO, No. 80-
5066-CV-S-4 (W.D. Mo. Jan. 31, 1984) and the follow-up Order
for Final Judgment (April 16, 1984), the Court allowed pre-
judgment interest at the rate of 9% simple interest calculated
from the date the amended complaint (adding CERCLA counts to a
RCRA §7003 case) was filed. The 9% interest rate was set "in
accordance with Missouri's post judgment interest statute."
January 31 Memorandum Opinion at 44. However, neither the
opinion nor the Government's pre or post-trial briefs indicated
whether the State statute was the applicable law, or if the
Court merely used the Missouri Statute as a guideline in the
absence of Federal law on the issue.
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VII. BANKRUPTCY PROCEDURES
In determining how to proceed against bankrupt parties in
cost recovery cases, the Regions should follow a four step
procedure.
First, the Region, in consultation with the DOJ case attorney,
should determine what type of bankruptcy action the responsible
party has filed for. Under a Chapter 7 bankruptcy, or "liquidation
bankruptcy", the debtor is granted a discharge of all debts
and must liquidate all assets. Under a Chapter 11 bankruptcy,
or "reorganization bankruptcy", however, there is not a liquidation
of assets. Instead the debtor is required to develop a
reorganization plan and payment schedule whereby portions of
the debts are paid to the different classes of creditors. The
Agency's claims under cost recovery are more likely to be
satisfied in a Chapter 11 bankruptcy.
Second, the Region must determine when to proceed against
a bankrupt party. In making this determination, the Region
should balance the likelihood of recovering assets from the
estate of the insolvent party against the extent of Agency
resources required to prosecute bankrupt parties. The Regions
should also evaluate the possible deterrence effects that a
lawsuit will have upon other entities that may file, or are
seeking to file, frivolous or -fraudulent bankruptcy claims.
Third, the Region should refer the bankruptcy claim to the
Department of Justice for filing. Prompt referral of bankruptcy
cases is necessary to preserve the Agency's claims as a creditor.
412
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Ordinarily the type of claim made by the United States in a
CERCLA action will be quite unlike a secured lien and will
therefore require the filing of a proof of claim indicating the
nature of the government's claim (See Bankruptcy Form 10).
Unless an extension is moved for and granted, Chapter 7 bankruptcy
claims must be filed 90 days from the first meeting of the
creditors. Bankruptcy Rule 3002(c) . The deadline for Chapter
11 bankruptcy claims is set by the Court. Bankruptcy Rule 3003(c) .
Often it must be filed before the Court approves the debtor's
reorganization plan. In emergency situations, telephone referral
to DOJ with EPA Headquarters concurrence may be appropriate.
After DOJ approval, a proof of claim should be filed
with the Bankruptcy Court which states the amount of the debt
and the basis for the claim. The Region should be prepared at
the time of filing of a proof of claim in Bankruptcy Court to
prove that the estate is liable under S107 of CERCLA. Therefore,
the referral to the Department of Justice should include all
the information necessary for a cost recovery action. OWPE
will try to expedite requests for documents in those late-discovered
bankruptcy cases that require immediate filing of a proof of
claim. The Regions must, however, clearly articulate the
urgency of the situation to OWPE and request that Headquarters
reorganize the cost documentation collection priorities for that
Region.
Fourth, EPA and the Department of Justice must determine
which theories of recovery are appropriate, and whether to
413
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proceed in District Court or Bankruptcy Court. The theories of
recovery may include: claims as administrative expenses of the
estate; recovery under §506(c) of the Bankruptcy code; equitable
leins; and common law restitution. The considerations of
whether to initiate proceedings in District Court or Bankruptcy
Court include: the extent of assets in the estate; the applicability
of the automatic stay provisions in the Bankruptcy Act; the
extent of previous litigation; and the facts of the case.
For more discussion on enforcement theories available to
the Agency to pursue insolvent parties, and for more specific
guidance regarding procedures in bankruptcy cases, refer to
"Guidance Regarding CERCLA Enforcement Against Bankrupt Parties"
issued on May 24, 1984, by Courtney M. Price, Assistant
Administrator for the Office of Enforcment and Compliance
Monitoring.
414
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VIII. UPDATING OF COSTS
The actual litigation of CERCLA $107 cases may be a very
N
lengthy process. Negotiations may take place before a case is
filed. Once a case is filed, negotiations may continue and the
litigation process itself may be conducted over a period of
many months or several years. Often site work may be ongoing
while the case is in litigation. And certainly litigation
costs are being incurred by EPA, DOJ, and often, contractors.
During the course of negotiations or litigation, the case
development team may need to update costs for a particular case.
For completed removal actions, with no other site activity
in progress, an update of costs is a relatively easy exercise.
The case development team can update Regional payroll and travel
and OWPE can update headquarters payroll and travel. DOJ, upon
request from the assigned DOJ or U.S. attorney, can update its
litigation support costs.
There are, however, cases where the government is pursuing
a $107 action but costs are still being incurred for on-site
activity (e.g., §106 cases that also have a §107 count and
remedial action has not yet been completed). Updating costs
for these types of cases may actually be the equivalent of
documenting a new §107 case.
The case development team must allow for at least three
weeks from a request for a cost update and its receipt. The
Region must balance the need for a cost update against the
needs of the other cases in the Region which require documentation
415
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The collection of cost documentation is not a process which
can be "turned off" once it has been initiated. Therefore, it
is important that the case development team use discretion
and good judgment when requesting a cost update.
Cost updates may be requested by submitting a written
request to the Cost Recovery Group, OWPE. The memorandum
is to specify why and when an update is needed and the categories
of costs which need updating. The case development team must
give OWPE as much lead time as possible to accommodate update
requests. OWPE will collect the requested information and
prepare a summary of updated costs. The summary and documents
will be forwarded to the case development team in the Region.
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IX. ACTUAL PAYMENT INTO THE TRUST FUND
To accelerate the receipt and investment of monies
recovered from responsible parties under CERCLA, the Department
of the Treasury has provided a separate lockbox for Superfund.
Checks for cost recoveries, penalties and fines should be made
payable to the EPA Hazardous Substance Response Trust Fund and
sent to the following address:
EPA Superfund
P.O. Box 371003M
Pittsburgh, PA 15251
Checks should be accompanied by transmittal letters that
state the name of the responsible party and the site for which
payment is being rendered. The remittance address and instructions
should be included in all settlement documents (consent decrees,
administrative order, or settlement agreements) and demand letters.
The Regional Counsel representative on the case development
team is responsible for sending a copy of the signed consent/
settlement document (as soon as it is available) to the following
address:
US EPA
Financial Management Division, PM-226
Financial Reports and Analysis Branch
401 M Street, S.W.
Washington, D.Ci
Attn: Ivery M. Jacobs, Rm 3623M
These documents are necessary to establish an accounts
receivable to assure that funds are ultimately received and to
assure that funds that are received are credited to the
appropriate account and reported to the Hazardous Substance
Response Trust Fund for investing.
417
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APPENDIX A
FLOW CHART OF COST DOCUMENTATION PROCESS
DEFINITIONS OF ACRONYMS USED IN FLOW CHART
IAG: INTER-AGENCY AGREEMENT
REM: REMEDIAL CONTRACT
FIT: FIELD INVESTIGATION TEAM CONTRACT
TAT: TECHNICAL ASSISTANCE TEAM CONTRACT
TES: TECHNICAL ENFORCEMENT SUPPORT CONTRACT
CLP: CONTRACT LABORATORY PROGRAM
NEIC: NATIONAL ENFORCEMENT INVESTIGATIONS CENTER
ERT: EMERGENCY RESPONSE TEAM
EMSL: ENVIRONMENTAL MONITORING AND SYSTEMS LABORATORY
418
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CERCLA § 107: COST DOCUMENTATION PROCESS
REGION
PAYROLL
1
REGION
TRAVEL
COOPERATIVE
AGREEMENT
OTHER
REGION
COSTS
1 1 1
VO
PACKAGE
DOCUMENTS
1
REM
F
^M
T
PREP
SIMM
1
TAT
ARE
NARY
1
h
I i i
ICLPJ NEIC IERT
1
EMSL
HO
PA1
1 1 1 1
HO
PAYROLL
HQ
TRAVEL
IAGS
CONTRACTS
C • T - CMf OtVUOmUIT TEAK
0 W P t - OFFICE OF HASTf MOCHAMS IHrOHCIMlKT
FMO - riNANCIAL MAWACCMtNT OrVKIOH
-------
APPENDIX. B
SITE-SPECIFIC SPUR CHARGES
SOFTWARE PACKAGE FOR UNIQUE REPORTS (SPUR)
Through the use of SPUR, the Financial Management System
(FMS) can produce reports which summarize specific Superfund
charges of individual sites. However, because some expenditures
that benefit specific sites are not charged to site specific
accounts, the FMS does not identify all direct site response
costs* The following is a list of the site specific cost
categories which are included in a SPUR:
SITE-SPECIFIC EPA PAYROLL
i ,
SITE-SPECIFIC TRAVEL
OSC EMERGENCY REMOVAL CONTRACTS
ERCS CONTRACTS
MAJOR REMEDIAL SITE-SPECIFIC WORK ASSIGNMENTS:
REMEDIAL INVESTIGATION/FEASIBILITY STUDY (RI/FS)
REMEDIAL DESIGN
REMEDIAL CONSTRUCTION
REIMBURSEABLE SITE-SPECIFIC IAGS
STATE SITE-SPECIFIC COOPERATIVE AGREEMENTS
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APPENDIX. C
DESCRIPTION OF SUPERFUND CONTRACTS
TECHNICAL ASSISTANCE TEAM CONTRACT (TAT)
SCOPEi
This contract is designed to assist EPA in responding to all
reported environmental emergencies, including oil spills
(under S311 of the Clean Water Act) chemical spills and
uncontrolled hazardous waste disposal sites. Response includes
damage assessment field studies, monitoring cleanup operations,
and coordinating with local governments. Other functions
such as conducting spill prevention compliance checks are
also performed. Under this nationwide contract, teams (TAT)
are provided to EPA headquarters, all ten EPA regions, and
both of the Environmental Response Teams (ERT). The TAT
contract does not perform any actual cleanups.
Original Contractor: Ecology & Environment, Inc. (E&E)
Contract Number: 68-01-5158
Dates of Contract: February 1979 to October 1982
EPA Project Officer: Jack Jojokian
Current Contractor: Roy F. Weston, Inc.
Contract Number: 68-01-6669
Date of Contract: October 1982 to September 30, 1986
EPA Project Officer: Jack Jojokian
EPA Contract Officer: Paige E. Peck
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ON SCENE COORDINATOR EMERGENCY REMOVAL CONTRACTS
SCOPE;
These contracts are designed for emergency or immediate removal
situations initiated by the On Scene Coordinator. These
contracts are entered into on an individual basis as an
emergency situation arises. Contract is usually initiated
with a letter to ^proceed. All work under these contracts is
site specific.
Emergency Removal Cleanup Service Contracts (ERCS)
SCOPE:.
These contract are designed to respond to environmental
emergencies with resources necessary to contain, cleanup/
remove and dispose of hazardous materials. There are four
ERCS Zone contractors.
ERC Zone I (Regions I, II, and III);
Contractor: O. H. Materials Co.
Contract No.: 68-01-6893
Dates of Contract: February 1, 1984 to Janueary 31, 1987
EPA Project Officer: James Jowett
EPA Contract Officer: Patrick Flynn
ERC Zone II (Region IV):
Contractor: Hazardous Waste Technology Services
Contract No.: 68-01-6859
Dates of Contract: December 1, 1983 to November 30, 1986
EPA Project Officer: James Jowett
EPA Contract Officer: Thomas F. Sullivan
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ERC Zone III (Region V);
Contractor: PEDCo Environmental, Inc.
Contract No.: 68-01-6894
Dates of Contract: February 1, 1984 to January 31, 1987
EPA Project Officer: James Jowett
EPA Contract Officer: Dorothy Britton
ERC Zone IV (Regions VI, VII/ VIII, IX, X);
Contractor: Environmental Emergency Services
Contract No. 68-01-6860
Dates of Contract: December 1, 1983 to November 30, 1986
EPA Project Officer: James Jowett
EPA Contract Officer: Thomas F. Sullivan
423
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REMEDIAL ACTION CONTRACTS (REM)
SCOPE t
The Remedial Action contracts primary focus is to investigate
and provide long term corrective action for NPL sites. Tasks
under the REM contracts include the following:
Remdedial Action Master Plans (RAMPS)
Remedial Investigations/Feasibility Studies (RI/FS)
Initial Remedial Measures (IRM)
Enforcement and technical oversight projects
Community Relations Plans
Remedial Design and Construction
The contractors are tasked through work assignments,
which are generally site-specific. However, some work assignments
are written to cover a number of site for a particular task
such as RAMPS and community relations plans.
The Superfund program originally had three REM contractors:
Camp, Dresser, McKee (COM)
Contract No. 68-03-1612
Dates of Contract: June 1981 to March 1983
Roy F. Weston
Contract No. 68-03-1613
Dates of Contract: June 1981 to October 1982
Black & Veatch
Contract No. 68-03-1614
Dates of Contract: June 1981 to October 1982
In October 1982, the original REM contracts were replaced
with two zone REM/FIT Contracts. These are three year contracts.
REM Zone I (Region I - IV)t
Contractor: NUS Corp.
Contract No. 68-01-6699
Dates of Contract: October 1, 1982 to September 1986
EPA Project Officer: William Kaschak
EPA Contract Officer: Ronald L. Kovach
424
-------
REM Zone II (Region V - X) ;
Contractor: CI^MHill Southeast/ Inc.
Contract No.: 68-01-6692
Dates of Contract: October 1, 1982 to September 30, 1986
EPA Project Officer: Nancy Willis
EPA Contract Officer: Dorothy Tyler
In June 1984 an additional nationwide REN contract was awarded
under which the contractor is to perform remedial response
activities at uncontrolled hazardous waste sites and prepare
A&E design specifications of the selected remedies.
REM II (Nationwide):
Contractor: Camp, Dresser & McKee; Inc.
Contract No.: 68-01-6939
Dates of Contract: June 1, 1984 to May 30, 1988
EPA Project Officer: William Kaschak
EPA Contract Officer: William R. Topping
425
-------
FIELD INVESTIGATION TEAM (FIT) CONTRACT
SCOPE:
The Field Investigation Team (FIT) Contracts establish
an investigation team in each EPA Region, comprised of multi-
disciplinary professional and para-professional personnel who
are capable of providing a breadth of technical activities.
Specifically, the FIT contracts constitute the primary
capability of EPA for investigating hazardous waste sites.
Current FIT operations are part of the REM/FIT Zone Contracts.
OPERATIONS;
Tasks conducted by the FIT contracts are initiated in the
Regions by designated Regional Project Officers (RPO's) using
a work order process called Technical Directive Documents
(TDDs). Wajor functions include the following:
0 Preliminary Assessments and Site Inspections (PA/SI)
to determine the hazard potential at waste sites.
0 Conduct Hazard Ranking System Scoring for sites considered
for inclusion on the National Priorities List (NPL).
0 General enforcement support for case development,
particularly field oriented technical activities (e.g.,
sampling).
0 Remedial Investigations (RI) for enforcement lead sites.
0 Hydrological, geophysical and general field investigatory
work which may be part of or separate from any of the
above activities.
0 Provides subcontracting support for activities such as
well drilling, obtaining specialized technical expertise,
and related support services.
0 Dioxin strategy implementation support.
0 Provide technical experts for compliance monitoring and
oversight functions.
0 Help to develop technical manuals, policies and standard
operating procedures.
426
-------
FIT Contract:
Original Contractor: Ecology and Environment, Inc. (E4E)
Contract No.: 68-01-6056
Dates of Contract: February 1980 to December 1982
EPA Project Officer: Scott Fredericks
Current Contractors:
REM/FIT Zone I (Regions I - IV):
Contractor: NUS Corporation
Contract Mo.: 68-01-6699
nate of Contract: October 1, 1982 to September 30, 1986
EPA Deputy Project Officer: Scott Fredericks
EPA Contract Officer: Ronald L. Kovach
PEM/FIT Zone II (Regions v - X);
Contractor: Cf^MHill (Ecology and Environment is FIT subcontractor)
Contract No.: 68-01-6692
Dates of Contract: October 1, 1982 to September 30, 19P6
EPA Deputy Project Officer: Scott Fredericks
EPA Contract Officer: Dorothy Tyler
427
-------
CONTRACT LABORATORY PROGRAM (CLP)
SCOPE:
The Contract Laboratory Program (CLP) was established
to provide laboratory sample analyses for the Superfund program,
The CLP can provide routine and special analytical services for
inorganic, organic and dioxin samples. The CLP is managed
by VIAR, Inc. Approximately 40 different laboratories are
used under the CLP. Each of the laboratories used under the
program will have one or more contracts with the Agency.
Site samples are taken by the Regional offices and tagged
with a sample number. The Sample Nanagment Office (SMO),
which is managed by VIAR, will tell the Region which laboratory
the samples should be sent to. The individual laboratories
do not know what sites the samples have been taken from.
VIAR tracks all sample numbers and invoices.
Sample Management Office (SMO) Contract:
Contractor: VIAR and Company
Contract No.: 68-01-6702
Dates of Contract: October 1, 1982 to September 30, 1985
EPA Project Officer: Stan Kovell
EPA Contract Officer: Marian Bernd
428
-------
TECHNICAL ENFORCMENT SUPPORT CONTRACT (TES I & II)
SCOPE;
The Technical Enforcement Support (TES) Contract was
awarded in June 1983 to support enforcement actions under
CERCLA. The TES contract can provide the following services:
Responsible Party Searches
Title Searches
Financial Asessments of Responsible Parties
Records Compilation
Health/Endangerment Assesments
Technical Review of Documents
Expert witnesses
The TES contract is tasked through work assignments
which are generally site-specific.
TES I
Contractor: GCA Corp.
Contract No.: 68-01-6769
Dates of Contract: June 10, 1983 to June 9, 1986
EPA Project Officer: Elwood Martin -
EPA Contract Officer: Marian Bernd
TES II
Contractor: planning Research Corp. (PRO
Contract No.: 68-01-7037
Dates of Contract: September 1984 to September 1986
EPA Project Officer: Elwood Martin
EPA Contract Officer: Marian Bernd
429
-------
ENVIRONMENTAL RESPONSE TEAM (ERT)
The Environmental Response Team is located at the EPA facility
in Edison, New Jersey, and also retains a three-member staff
at EPA's A. W. Breidenbach Environmental Research Center in
Cincinnati, Ohio.
The ERT's major functions are to:
0 Maintain an around-the-clock activation system.
0 Upon request, dispatch Team members to environmental
emergencies 'to assist Regional and program offices.
0 Provide critical consultation in water and air quality
criteria, toxicology, interpretation and evaluation of
analytical data, .and engineering and scientific studies.
0 Develop and conduct site-specific safety programs.
0 Provide specialized equipment to meet specific requirements
such as monitoring, analytical support, waste treatment,
containment and control.
0 Provide technical experts for a Public Affairs Assistance
Team (PAAT).
0 Supervise the work of contractors.
0 Help to develop training manuals, policies, and standard
operating procedures.
0 Assist the Office of Research and Development in developing
new technology for use at environmental emergencies and
uncontrolled hazardous waste sites.
0 Train Federal, State and local government officials
and industry representatives in the latest technology
for environmental emergencies at hazardous waste sites.
430
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ENVIRONMENTAL EMERGENCY RESPONSE UNIT (EERU) CONTRACT
SCOPE: EERU is divided into two groups: Operations and Research
OPERATIONS:
Through the Environmental Response Team (ERT)f EERU provides
technical support and assistance to On-Scene Coordinators and
other emergency response personnel on environmental issues
dealing with the cleanup of emergency spills and uncontrolled
hazardous waste sites. Site support services of the contract
include such activities as sampling, use of specialized
monitoring equipment, conducting extent-of-contamination
surveys and procurement of specialized subcontractors for
well drilling, analytical support, etc. Other services
include the conduct of training exercises including demonstrations
of equipment and "hands on" training under simulated but
realistic field conditions.
RESEARCH;
Through the Oil and Hazardous Material Spills Branch (QHMSB),
EERU provides shakedowns and field demonstrations of prototype
equipment during spills and at cleanups of uncontrolled
hazardous waste sites. Evaluation and improvement of government
owned or commercially available cleanup devices and systems
is the primary objective of this side of the contract.
Original Contractor: Mason & Hanger-Silas Mason Co., Inc.
Contract No.: 68-03-2647
Dates of Contract: January 23, 1978 to June 28, 1981
EPA Project Officer: J. Stephen Dorrler (ERT) and Ira Wilder (R&D)
Current Contractor: IT Corporation
Contract No.: 68-03-3069
Dates of Contract: June 29, 1981 to June 28, 1985
EPA Project Officers: J. Stephen Dorrler (ERT) and ira Wilder (R&D)
EPA Contract Officer:
431
-------
ENVIRONMENTAL MONITORING AND SYSTEMS LABORATORY CONTRACT
SCOPE: The Environmental Monitoring and Systems Laboratory
(EMSL) manages a contract which provides upon request aerial
photography, photographic interpretation and topographic mapping
of hazardous waste sites. Requests are generally site specific
and may be from the regional offices or headquarters.
Zone I (Regions I - IV)
Contractor: Bionetics
Contract No.:
Dates of Contract:
EPA Project Officer: Tom Osberg
EPA Contract Officer: Pong Lem
Zone II (Regions V - X)
Contractor: Lockheed Inc. (LEMSCO)
Contract No. 68-0'3-J049
EPA Project Officer: Clay Lake
EPA Contract Officer: Pong Lem
432
-------
NATIONAL ENFOCREMENT INVESTIGATIONS CENTER (NEIC) CONTRACT
SCOPE: The National Enforcement Investigations Center (NEIC)
provides various types ofenforceraent support activities for
CERCLA cases. Activities include site investigations, sample
collection, sample screening for hazardous characteristics
and sample preparation for analyses and compositional lab
analysis. Sample screening and preparation is done under
contract with Fred C. Hart (this contract is oart of the
National Contract Lab Program). NEIC also provides for
security of sensitive samples for enforcement purposes and
chain of custody procedures. NEIC provides evidence audits
through the Contract Evidence Audit Team (CEAT). The current
CEAT contractor is Tech Law, Inc. Evidence audits provide
inventories of case documents and preparation of documents for
use as evidence. Evidence audits also provide sample profiles
and summaries of analytical data.
Contract Evidence Audit Team
Original Contractor: INTERA
Contract No.: 68-01-6215
Dates of Contract: September 1980 to September 1983
/
EPA Project Officer: Rob Laidlaw
EPA Contract Officer: Pat Murphy
Current Contractor:. TECH LAW, Inc.
Contract No. 68-01-6838
Dates of Contract: October 1983 to
EPA Project Officer: Rob Laidlaw
EPA Contract Officer: Pat Murphy
433
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APPENDIX D
COST RECOVERY CHECKLIST
DATE:
COST RECOVERY DOCUMENTATION CHECKLIST
1. SITE NAME: . ^_^ CITY/COUNTY
SITE ACCOUNT NUMBER; NPL YES
(OTHER NAMES USED FOR THIS SITE:
2. STATUS: CHECK ONE:
TRIAL DATE (DATE: )
IN DISCOVERY (DEADLINE: )
FILED
REFERRED TO DOJ
REFERRED TO HEADQUARTERS
IN PREPARATION IN REGION
STATUTE OF LIMITATIONS
PROJECTED/ON GOING NEGOTIATIONS
DEMAND LETTER TO BE SENT
3. NAME AND TELEPHONE NUMBER OF OSC/REGIONAL CONTACT:
4. NAME'AND TELEPHONE NUMBER OF REGIONAL COUNSEL CONTACT:
5.WHICH, IF ANY, OF THE FOLLOWING FIT CONTRACTORS WERE USED?
ESE (CONTRACT No. 68-01-6056) DATES OF WORK
NUS (CONTRACT No. 68-01-6699 DATES OF WORK
E&E (FIT SUBCONTRACTOR TO CH2MHILL, CONTRACT No. 68-01-6692)
(ZONE II)
DATES OF WORK
6. WHICH IF ANY OF THE FOLLOWING TAT CONTRACTORS WERE USED?
E&E (CONTRACT No. 68-01-5158) DATES OF WORK
ROY F. WESTON (CONTRACT No. 68-01-6669)
DATES OF WORK
7. WAS WORK DONE THROUGH THE CONTRACT LAB PROGRAM (VIAR)? YES NO
IF YES, PLEASE PROVIDE ANY SPECIAL ANALYTICAL SERVICES (SAS) CASE
NUMBERS:
434
-------
COST RECOVERY DOCUMENTATION CHECKLIST, PAGE 2
WAS LAB WORK OTHER THAN THROUGH VIAR USED? YES NO
IF YES, PLEASE GIVE LAB NAME AND CONTRACT NUMBER:
8. WHICH IF ANY OF THE FOLLOWING REM CONTRACTORS WERE USED?
(DESCRIBE TASKS WITH THE FOLLOWING: RAMP, IRM, RI/FS, DESIGN
CONSTRUCTION, COMMUNITY RELATIONS, ENFORCEMENT, OR OTHER)
BLACK & VEATCH (CONTRACT No. 68-03-1614)
DATES OF WORK TASK
CAMP DRESSER & MCKEE (COM) (CONTRACT No. 68-03-1612)
DATES OF WORK TASK
ROY F. WESTON (CONTRACT No. 68-03-1613)
DATES OF WORK TASK
NUS (ZONE I, CONTRACT No. 68-01-6699)
DATES OF WORK TASK
CH2MHILL (ZONE II, CONTRACT No. 68-01-6692)
/
DATES OF WORK TASK
CAMP DRESSER MCKEE (REM II CONTRACT No. 68-01-6939)
DATES OF WORK TASK
9. PLEASE PROVIDE THE FOLLOWING INFORMATION ABOUT CONTRACTORS
LET BY AN OSC OR EMERGENCY REMOVAL CLEANUP (ERCS) CONTRACT:
CONTRACTOR:
CONTRACT NO. DELIVERY ORDER No.
DATES OF WORK:
10. WERE ANY OVERFLIGHTS DONE? YES NO
DATES OF OVERFLIGHTS:
11. WAS ANY WORK DONE BY NEIC? YES NO
DATES OF WORK , TASK
435
-------
COST RECOVERY DOCUMENTATION CHECKLIST, PAGE 3
WAS AN EVIDENCE AUDIT OR OTHER WORK DONE THROUGH NEIC CONTRACT
WITH TECH LAW (INTERA)? YES NO DATES OF WORK
12. WAS WORK DONE BY THE EERU CONTRACT WITH IT CORP? YES NO
(CONTRACT No. 68-03-3069)
DATES OP WORK:
WAS WORK DONE BY EMERGENCY RESPONSE TEAM (EDISON LAB) YES NO
DATES OP WORK:
13. WAS ANY WORK DONE UNDER THE TES I CONTRACT? YES NO
CONTRACT NO. 68-01-6769 (PRIME CONTRACTOR: GCAT"
DATES OF WORK: TASKS PERFORMED:
WAS ANY WORK DONE UNDER THE TES II CONTRACT? YES NO
CONTRACT No. 68-01-7037 (PRIME CONTRACTOR: PRCT
DATES OF WORK: TASKS PERFORMED:
14. WAS ANY WORK DONE UNDER THE LIFE SYSTEMS CONTRACT? YES NO
CONTRACT No. 68-03-3136
DATES OF WORK
ANY OTHER CONTRACTOR USED: NAME:
CONTRACT NO. DATES OF WORK:
15. PLEASE PROVIDE THE FOLLOWING INFORMATION ABOUT OTHER FEDERAL
AGENCIES THAT WORKED ON THE SITE:
AGENCY IAG t DATES OF WORK CONTACT PERSON/TELEPHONE
HHS
COE
USCG :
FEMA
DOJ
DOI
436
-------
COST RECOVERY DOCUMENTATION CHECKLIST, PAGE 4
NOAA
USGS
BRIEF DESCRIPTION OF WORK:
16. WAS THERE A STATE COOPERATIVE AGREEMENT OR CONTRACT? YES NO
STATE: COOPERATIVE AGREEMENT f
CONTRACT NO.
17. WERE ANY OTHER CONTRACTORS (e.g., R&D CONTRACTS) USED?
IF SO, PLEASE PROVIDE THE FOLLOWING:
CONTRACTOR:
CONTRACT No.
DATES OF WORK:
BRIEF DESCRIPTION OF WORK:
18. WERE ANY REGIONAL COUNSEL APPROPRIATIONS FOR LEGAL EXPENSES
USED? YES NO
19. PLEASE LIST THE REGIONAL OFFICES WHICH HAVE BEEN INVOLVED IN
THE CASE:
20. ANY OTHER PERTINENT INFORMATION NOT PROVIDED ABOVE:
437
-------
APPENDIX E
SAMPLE CASE COST SUMMARY
Prepared: 10/22/84
NARRATIVE SUfWY/STATEMEOT OF FACTS — COSTS FOR
1. the United States Environmental Protection Agency has incurred costs of
- • at least $188,424.64 for Headquarters and Regional payroll.
2. The United States Environmental Protection Agency has incurred costs of
at least 551,890.44 for Headquarters and Regional travel.
3. The United States Environmental Protection Agency has incurred costs of
at least 5109,953.36 for remedial contract expenditures. This total
represents the amount spent under the
4. The United States Environmental Protection Agency has incurred costs of
at least 515,131.26 for remedial contract exnenditur**. This total
represents the amount spend under the
5. The United States Environmental Protection Agency has incurred costs of
at least 5420,794.22 for remedial contract expenditures. This total
represents the amount spent under the
6. The United States Environmental Protection Agency has incurred costs of
at least 5212,813.16 for field investigation team contract expenditures.
This total represents the amount spent under the
7. The United States Environmental Protection Agency has incurred costs of
at least 547,560.11 for technical assistance team contract expenditures.
This total represents the amount spent under the Ecology and Environment
contract.
8. The United States Environmental Protection Agency has incurred costs of
at least 511,938.51 for On-Site Coordinator (OSC) Let contract costs.
The emeraencv resoonse action has performed under contract by
9. The United States. Environmental Protection Agency has incurred costs of
at least 510,980.00 for aerial photograph and analysis support. This
total represents the amount spent under the EMSL contract.
10. The United States Environmental Protection Agency has incurred costs of
at least 5996,546.98 for Interagency Agreements (IAG) with the Department
of Justice and the U.S. Coast Guard.
438
-------
-2-
11. The United States Envirormental Protection Agency has incurred costs of
at least $190,661.62 for investigative contract costs under contract
by the National Enforcement Investigative Center (NEIC).
12. The United States Environmental Protection Agency has incurred costs of
. at least 510,438.00 for expert witness support under contract with the
13. The United States Environmental Protection Agency has incurred costs of
at least 5342,552.41 for National Lab contract expenditures. This total
represents the costs of generating laboratory analysis of samples collected.
14. The United States Environmental Protection Agency has incurred costs of
at least 5196,153.00 for miscellaneous contract costs under contract
by
439
-------
COST SUMMARY
EPA EXPENDITURES
EPA TRAVEL -——---------——•
REM CONTRACT —
REM CONTRACT —
REM GDNTRACT —
REH CONTRACT —
REM/FIT CONTRACT -
FIT CONTRACT —
TAT CONTRACT —
CSC LET CONTRACT
wV t_*l\T L*L\jn±j ^™ CnDi* •••—""•••
INTERAGENCY AGREEMENTS —
UQ-SQ C1
•_»___--____.P_____J_____ Tin Dilfi QQ
._ ... inr ici nn
Iff^l ___>MT|\i>^_i t .——_— _-__--^ . . . .. ±j\it AJJ.UH
TOTAL EPA EXPENDITURES $ 2,805,83?.71
440
-------
COST SUMMARY
EPA PAYROLL
EMPtOWE NAME — HEADQUARTERS
Barclay, Michael
Burack, Mitchell
Barnes, Wanda
Cibulski, Robert
Clemensr Rob
Conti, Susan
Delvin, Dennisr J.
Dick, Mary D.
Elkus, Barbara
Garrahan, Kevin
Gilbert, John M.
Grundler, Christopher
Farnsworth, Douglas
Keplinger, Helen
Klaas, Julie A.
Kosakowski, Michael
Lafornara, Joseph
Livolsi, Joseph
Mittelroan, Abraham
Murphy, Jack
Schwartz, Jerry
Wheeler, John
Wright, John
NUMBER
OF HOURS
63.0
1,017.25
3.0
25.0
22.0
1.0
441.0
5.0
3.0
609.0
8.0
130.0
3.0
2.0
3.0
8.0
8.0
30.0
12.0
198.0
20.5
51.0
4.5
AMOUNT
1,149.12
16,030.27
22.79
474.71
440.22
10.39
6,163.34
91.20
63.78
11,590.60
199.65
1,987.18
70.47
31.76
41.18
193.05
206.89
205.80
262.95
3,881.17
390.74
815.41
61.14
TOTAL EPA HEADQUARTERS PAYROLL
544,383.81
DOCUMENTATION:
FMD SPUR Report, dated June 9, 1984
Copies of Applicable Timecards
EMPLOYEE NAME — REGION
Adams, James
Allison, Birdie
Ashkanazy, Patricia
Banaszek, Kenneth
Bartelt, Richard
Bolger, Kevin
Carter, Barbara
43.0
5.0
14.0
18.0
• 17.0
119.5
3.0
964.08
41.08
118.51
267.28
416.95
1,732.09
26.52
441
-------
-2-
EPA PAflOLL
EMPLOYEE NAME — REGION
Castle, Charles
Constantelos, Basil
Dikinis, Jonas
Elan, Michael
Elly, Charles
Field, Roger
Flynne, Yvonne
Frye, Gilbert
Gade, Mary
Gardner/ Caryn
Grimes/ Roger
Hall/ Robert
Hsia, Kei
Jirka, Andrea
Jones/ Wanda
Joseph/ Chacko
Kin, Sukviha
Kin/ Thomas
King, Ernest
Knoy, Janes
Kucharz, Carolyn
Kuehl/ Marcia
Kulna, Gregory
Kush/ Beverly
Kyte, Lawrence
Larger/ Mary
May, Dorothy
Morgan/ Dorothy
Morris/ John
Parikh/ Pankaj
Paruchuri/ Babu
Phillips/ Marsha
Radcliffe, Michelle
Randall, Sheila
Regan/ Gerald
Rekar, Pamela
Ross, Curtis
Rutter/ Anthony
Sargent/ William
Schaefer/ Robert
Schmidt/ Larry
Schulteis/ Jane
Sedwick/ Helen
Street, Kerry
NUMBER
OF HOURS
1.0
8.0
33.0
2.0
31.0
30.5
135.0
90.0
134.5
37.0
23.5
7.0
15.0
41.2
4.0
145.0
134.0
78.0
80.0
68.0
17.0
6.0
8.0
2/899.0
2/181.0
1.0
5.5
30.0
37.0
99.6
36.0
60.0
747.8
19.7
1.0
640.2
1.0
27.0
17.3
25.5
182.0
.5
247.5
42.0
AMOUNT
19.71
231.53
570.52
30.55
729.94
683.01
2,477.02
1,777.22
2,806.89
314.22
488.45
125.32
234.36
746.97
32.27
2/496.53
2/726.04
984.70
1,414.78
942.41
200.67
96.35
123.76
50,592.31
39/718.02
11.41
67.42
199.63
669.38
1,141.07
567.57
660.49
5,204.35
151.02
25.06
10,902.58
28.70
472.07
125.57
782.59
2,566.00
9.59
2,060.80
646.60
442
-------
-3-
EPA PAYROLL
EMPLOYEE NAME — REGION NUMBER
— OF HOURS AMOUNT
Thakkar, Jayinthal 73.0 1,066.81
Tyson,-Mary 27.0 472.07
Ullrich, David 10.2 312.91
Vanderlaan, Gregory -47.0 917.59
Weslowski, Dennis 18.0 250.02
Witchcr, Stephanie, 4.0 34.93
Wonack, Belinda 52.0 331.24
Wong, Gene 8.0 94.66
Young, Marvin 7.0 138.64
TOTAL REGIONAL PAYROLL $144,040.83
DOCUMENTATION: EPA Region V Personnel Cost Stannary as of August 18, 1984
TOTAL EPA PAYROLL (HEADQUARTERS AND REGION) 5188,424.64
443
-------
rosr SUMMARY
EPA TRAVEL
EMPLOYEE NAME — HEADQUARTERS
Barclay, Michael
Biros, Francis, J.
Burack, Mitchell
Cibulski, Robtrt
Grundler, Christopher
Devlin, Dennis J.
Garrahan, Kevin
Lueero, Gene
Murphy, Jack
TRAVEL
NUMBER
970381
970391
838151
911448
747780
974948
974935
974925
575312
764972
754295
993411
839112
965684
969061
961987
827895
778420
730521
829636
829637
830288
911401
838332
911443
970316
829653
829626
983121
983119
830226
VOUCHER
AMOUNT
296.21
294.20
445.95
543.95
511.60
373.71
208.00
44.00
675.67
363.50
545.09
320.85
282.45
489.05
289.69
350.94
291.75
322.68
274.38
410.69
407.55
222.25
559.70
215.45
461.69
213.00
398.50
689.50
281.93
298.74
251.91
TREASURY NUMBER
AND DATE
93709
73759
93796
93212
93275
93892
93728
93507
93086
93386
93087
64548
06262
64361
64363
64666
92648
92387
92303
93247
93247
93359
93125
93449
93167
93502
93253
93126
93694
93698
93482
6/7/83
6/20/83
6/29/83
12/14/82
1/4/83
7/29/83
6/10/83
4/4/83
11/3/82
2/25/83
11/4/82
1/10/84
4/27/83
11/25/83
12/6/83
4/5/82
8/25/82
5/7/82
4/8/82
12/21/82
12/21/82
2/2/83
11/19/82
3/16/83
12/16/82
4/5/83
12/23/82
11/22/82
6/2/83
6/6/83
3/28/83
444
-------
EPA TRAVEL
EMPLOYEE NAME — HEADQUARTERS
Schwartz, Jerry
wofttl, Deborah
TOTAL EPA HEADQUARTERS TRAVEL
TRAVEL
NltiBER
97219?
754314
VOUCHER
AMOUNT
315.25
294.50
TREASURY NUMBER
AND DATE
64618 3/7/84
93219 12/16/82
511,944.33
DOCUMENTATION: FMD SPUR Report, dated June 30, 1984
Copies of Applicable Paid Travel Vouchers and Treasury Schedules
EMPLOYEE NAME — REGION
Adams, James
Bartelt, Richard
Carlson, Marcia
Castle, Charles
Constantelos , Basil
Dikinis, Jonas
Elam, Michael
Field, Roger
Gade, Mary
Haitian, Robert
43344
23269
41084
41118
41192
30539
20294
20718
23077
22472
30524
30947
33299
23488
42161
32518
33907
40089
30294
30345
30538
33271
42299
325.90
125.25
127.51
317.00
411.75
440.77
307.65
235.00
88.70
180.00
219.26
304.40
152.63
137.00
238.81
206.00
268.75
293.30
249.54
206.28
245.25
178.87
286.38
445
-------
-3-
EPA TBAVEL
EMPLOYEE NAME —
Knoy,
Rush, Beverly
TRAVEL
NUMBER
41559
42098
22571
23171
23214
23348
23401
23493
23554
23653
30309
30573
30639
30818
30973
31024
31051
31194
31462
31548
31626
31709
31851
31985
32112
32262
32521
32631
32702
32730
32893
32997
33109
33200
33230
33451
33658
33678
33851
33890
34001
34054
34200
34226
34323
MDUOiER
AMOUNT
270.07
119.76
304.60
168.90
242.90
149.40
403.63
174.40
421.92
284.80
175.50
160.70
309.29
266.10
182.92
210.44
54.23
273.00
149.62
193.30
230.50
200.10
215.31
375.15
254.30
840.08
303.91
290.45
264.90
275.36
333.55
184.00
337.25
181.50
214.00
389.92
327.72
387.25
184.80
384.05
383.53
321.38
195.75
275.23
393.50
446
-------
-4-
EMPLQYEE NAME — REGION
VOUCHER
NUMBER
VOUCHER
AMOUNT
Rush, Beverly
Kyte, Lawrence
34418
34505
34597
40100
40162
40239
40352
40538
40651
40707
40928
41014
41015
41066
41218
41261
41408
41524
41681
42246
42270
42453
42755
42938
44014
44461
44835
12376
20236
20427
20927
22071
22578
22741
22990
23055
23229
23303
23308
23526
23546
23680
23830
23858
30053
30347
390.97
395.93
182.10
445.54
350.38
522.49
350.34
279.15
227.00
353.98
361.43
50.16
291.98
222.29
362.05
353.52
292.61
292.93
273.73
241.48
239.99
371.98
270.68
240.38
143.98
195.70
155.72
207.30
141.75
215.95
262.39
196.00
349.65
329.00
117.96
212.10
232.40
323.43
167.50
349.88
523.68
604.81
247.32
468.25
705.38
156.15
447
-------
-5-
EMPLOYEE NAME — REGION
Kyte, Lawrence
Ostrodka, Steve
Payne/ David
Radcliffe, Michelle
Rekar/ Pamela
Schaefer, Robert
Sedwick, Helen
Vanderlaan, Gregory
TOTAL EPA REGIONAL TRAVEL
DOCUMENTATION: Regional Travel
VOUCHER
NUMBER
30551
30637
30760
30806
30966
32511
33908
34569
40087
42527
42953
43675
44412
44876
44015
44438
23433
22073
22740
23246
23307
23525
30636
30838
22574
23247
23430
22475
22749
23215
30308
30525
32150
34558
42756
Summary as of
VOUCHER
AMOUNT
177.88
216.70
304.16
224.35
216.75
190.84
215.30
251.38
278.40
347.09
314.51
89.53
304.47
21.38
132.00
369.30
336.84
208.30
308.62
354.21
155.75
286.10
184.30
185.90
194.06
336.74
194.50
152.85
335.10
258.50
181.50
248.21
223.96
402.90
269.50
539,946.11
August 6, 1984
TOTAL EPA TRAVEL
551,890.44
448
-------
OOST SUMMARY
CONTRACT
CONTRACTOR:
CONTRACT NO:
PROJECT OFFICER: Nancy Willis
DATES OF WORK: July 1983 - April 1984
SUJtIARY OF WORK: Remedial Enforcement Support; Remedial Investigation/
Feasibility Study
TOTAL CONTRACTOR COST: 5106,171.67
DOCUMENTATION: FMD SPUR Report Dated June 30, 1984;
Copies of Applicable Paid Invoices and Treasury
Schedules
Voucher
Nunber
11
12
13
14
15
16
17
18
19
Voucher
Amount
C?10, £12.93
5632,019.55
5810,491.19
5959,748.51
5736,708.51
52,267,864.09
52,675,862.08
$2,562,929.21
52,748,326.71
Voucher
Date
9/9/83
10/12/83
11/14/83
12/15/83
1/13/84
2/14/84
3/13/84
4/12/84
5/14/84
Treasury Schedule
Nunner and Date
7014 -
7055 -
7096 -
7170 -
7180 -
7228 -
7266 -
7318 -
7373 -
10/14/83
11/14/83
12/9/93
2/3/84
2/16/84
3/16/84
4/10/84
5/8/84
6/12/84
449
-------
COST SU»
-------
COST SUWARY
REM CONTRACT
CONTRACTOR:
CONTRACT .NO:
PROJECT OFFICER: Nancy Willis
DATES OF WORK: January 1983 - September 1983
SUFWAKf OF WORK: Remedial Action Master Plan (RAMP)
TOTAL CONTRACTOR COST: $2,700.54
DOCUMENTATION: Copies of Applicable Paid Invoices and Treasury
Schedules
Voucher
Number
5
6
7
8
9
10-5
11-5
12-5
Voucher
Amount
$1,390,834.00
$1,400,297.64
$514,696.70
$536,483.25
$595,664.64
$779,789.39
$740,612.93
$632,019.55
Voucher
Date
3/15/83
4/15/83
5/17/83
6/15/83
7/13/83
8/9/83
9/9/83
10/12/83
Treasury Schedule
Number and Date
7427
7495
7529
7571
7623
7696
7014
7055
- 4/13/83
- 5/18/83
- 6/14/83
- 7/19/83
- 8/10/83
- 9/21/83
- 10/14/83
- 11/14/83
451
-------
COST SUMMARY
REM CONTRACT
CONTRACTOR:
CONTRACT NO:
DATES OF WORK: August 82 - June 83
SUMMARY OF WORK: Renedial Action Master Plans (RAMPs)
TOTAL CONTRACTOR COST:
515,131.26
INVOICE
NUMBER
14
15
16
17
18
19
20
21
22
23
24
25
INVOICE
AMOUNT
155,012.29
132,742.75
227,133.43
179,183.70
209,948.96
61,990.76
47,932.58
27,299.91
9,603.64
9,866.31
52,814.88
716.66
INVOICE
DATE
9/9/82
10/4/82
11/8/82
12/6/82
1/17/83
2/4/83
3/7/83
4/8/83
5/10/83
6/7/83
7/18/83
8/8/83
TREASURY
NUMBER
27193
27400
27593
27884
271228
01357
01462
01657
01709
227562
07652
07689
TREASURY
DATE
•10/29/82
11/30/82
12/17/82
1/19/83
2/28/83
4/1/83
4/21/83
6/6/83
6/20/83
7/19/83
8/26/83
9/16/83
DOCUMENTATION: Copies of Applicable Paid Vouchers and Treasury Schedules
452
-------
10/22/84
REM CONTRACT
VOUCHER NO.
4
5
6
7
7
7
8
8
8
9
9
9
10
10
11
11
VOUCHER CKTE
2/15/83
3/15/83
4/15/83
4/15/83
5/6/83
5/17/83
7/7/83
5/12/83
7/27/83
6/15/83
7/13/83
7/13/84
7/13/83
8/9/83
9/9/83
9/9/83
9/9/83
VOUCHER AMOUNT*
1,103,951.00
1,397,056.00
1,400,297.04
215,325.09
100,301.00
514,696.70
326,921.28
41,799.08
301,457.06
536,483.25
1,896,609.69
329,523.15
595,664.64
320,452.68
806,210.55"
510,833.30
744,198.52
VOJfflERS
TREASURY NO. AND DATE
7353
7427
7495
7495
7515
7529
7605
7522
7641
7571
7623
7623
7623
7666
7696
7012
7014
3/15/83
4/13/83
5/18/83
5/18/83
6/6/83
6/14/83
8/4/83
6/8/83
8/22/83
7/19/83
8/10/83
8/10/83
8/10/83
9/8/83
9/21/83
1/13/83
10/14/83
*NOTE: Vouchers are not paid site specific; they are paid lump sum to
individual contractors for work performed during a certain period of tine.
453
-------
COST SU^*!ARY
FIT CONTRACT
CONTRACTOR:
CONTRACT NO:
DATES OF WORK: January 6, 1983 - August 1, 1983
SUMMARY OF WORK: Provide assistance and oversight in conjunction with
and during privately financed clean-up at site.
TOTAL CONTRACTOR COST: 5420,794.22
DOCUMENTATION: Contractor Cost Sunrwry
Copies of Applicable Paid Invoices and Treasury Schedules
454
-------
COST SUWAKf
FIT CarTRACT
CONTRACTOR:
CONTRACT NO:
DATES OF WORK: May 30, 1980 - Decent*r 10, 1982
SUMMARY OF WDKK: Provide assistance to Region in obtaining a complete scope
of work for clean up; perform work originally scheduled for subcontractor;
determine complete cost estimate for clean up; identification of generators
responsible for and the nature and quantity of chemiccal wastes now at the
site; organize, collate and summarize data; give analytical breakdown of
FIT report on generators utilizing the site; prepare a generator cost
estimate for removal and disposal of waste at the site; compare records
which were found at the ite with those furnished by the generators; review
site files to verify quantities of material shipped by various generators;
review ground waste study proposals for the site; determine the extent of
soil contamination and location of buried materials by utilizing geophysical
and soil boring techniques; assist in preparation of information being
sent to generators as part of the enforcement action for the site; perform
winterization of the surface water treatrent system.
TOTAL CONTRACTOR COST: 5212,813.16
DOCUMENTATION: Contractor Cost Summary
Copies of Applicable Paid Invoices and Treasury Schedules
455
-------
10/24/84
FIT CONTRACT -
— VOUOiERS
VOUCHER NO.
9
10
11
12
13
14
15
16
17
22
21
20
19
18
23
25
27
26
28
30
38
37
36
34
33
32
42
41
40
39
44
43
46
45
49
48
47
51
50
54
53
52
VOUCHER DATE
6/11/80
6/24/80
7/8/80
7/22/80
7/22/80
8/6/80
8/20/80
9/5/80
9/18/80
10/28/80
10/21/80
10/21/80
10/14/80
10/3/80
10/18/80
11/26/80
12/22/80
12/9/80
1/5/81
2/2/81
3/30/81
3/18/81
3/18/81
3/2/81
3/2/81
3/2/81
4/27/81
4/27/81
4/27/81 :
4/7/81
5/27/81
5/11/81
6/22/81
6/8/81
7/30/81
7/20/81
7/9/81
8/21/81
8/5/81
9/29/81
9/16/81
9/1/81
VOUCHER AMOUNT* TREASURY NO. AND DATE
394,503.00
348,863.00
488,487.00
562,609.00
87,000.00
484,609.00
469,252.00
502,283.00
310,443.00
473,821.00
10,620.00
562,291.00
342,026.00
340,403.00
122,488.00
391,925,00
280,322.00
390,741.00
322,216.00
493,213.00
524,213.00
439,330.00
3,051.00
151,849.00
437,891.10
15,813.00
366,725.00
454,122.00
303,773.90
147,035.00
395,757.00
477,270.00
379,437.00
467,851.00
164,308.00
464,492.00
438,686.00
410,397.00
421,354.00
364,636.00
359,953.00
377,975.00
7273
7287
7299
7316
7316
7336
7347
7359
7379
7031
7018
7018
7018
7008
7044
7055
7083
7066
7083
7136
7207
7207
7207
7158
7158
7158
7266
7266
7266
7220
7300
7278
7344
7323
7416
7418
7403
7443
7423
7076
7034
7021
6/16/80
6/25/80
7/11/80
7/24/80
7/24/80
8/13/80
8/25/80
9/8/30
9/23/80
11/04/80
10/23/80
10/23/80
10/23/80
10/7/80
11/18/80
12/2/80
1/9/81
12/15/80
1/9/81
2/18/81
4/2/81
4/2/81
4/2/81
3/6/84
3/6/81
3/6/81
5/6/81
5/6/81
5/6/81
4/9/81
6/1/81
5/14/81
7/1/81
6/16/81
8/11/81
8/12/81
8/3/81
8/25/81
8/14/81
11//3/81
10/6/81
10/1/81
*NOTE: Vouchers are not paid site specific; they are paid lump sum payments
to an individual contractor for work performed during that period of time.
456
-------
-2-
FIT CONTRACT -
VOUCHERS CDNTINUED
58
57
56
55
59
60
62
61
65
64
63
67
66
71
70
69
68
75
74
73
72
76
77
80
79
84
81
82
83
85
86
91
90
88
89
94
92
97
95
98
99
10/27/81
10/27/81
10/14/81
10/5/81
11/11/81
11/23/81
12/21/81
12/8/81
1/19/82
1/12/82
1/11/82
2/16/82
2/3/82
3/30/82
3/16/82
3/9/82
3/3/82
4/27/82
4/15/82
4/13/82
4/6/82
5/12/82
5/26/82
6/22/82
6/18/82
7/21/82
7/7/82
7/7/82
7/7/82
8/4/82
8/19/82
9/28/82
9/24/82
9/1/82
9/16/82
10/26/82
10/1/82
11/23/82
11/9/82
12/7/82
12/21/82
438,294.03
61,414.45
396,213.00
567,596.00
454,656.00
341,249.00
549,640.00
465,916.00
529,988.00
237,386.00
365,825.00
523,916.00
458,819.00
454,585.00
529,771.00
183,855.00
526,452.00
623,477.00
71,111.00
566,002.00
148,220.00
509,382.00
444,487.00
586,112.00
15,602.00
446,201.00
34,512.00
148,220.00
550,425.00
673,909.00
469,978.00
598,722.00
141,737.00
508,473.00
425,279.00
472,725.00
148,220.00
467,486.00
722,473.00
373,919.00
640,037.00
7076
7076
7076
7076
7131
7182
7204
7182
7262
7254
7325
7290
7290
7457
7338
7336
7320
7445
7426
7414
7387
7467
7515
7553
7553
7624
7586
7586
7586
7651
7682
7051
7051
7700
7042
7139
7051
7212
7188
7222
7250
11/3/81
11/3/81
11/3/81
11/3/81
12/8/81
1/13/82
2/3/82
1/13/82
3/4/82
3/2/82
3/11/82
3/17/82
3/17/82
6/2/82
4/13/82
4/9/82
4/2/82
5/19/82
5/14/82
5/11/82
5/3/82
6/9/82
6/24/82
7/14/82
7/14/82
8/18/82
8/2/82
8/2/82
8/2/82
9/1/82
9/15/82
10/21/82
10/21/82
9/21/82
10/15/82
11/22/82
10/21/82
12/28/82
12/15/82
1/7/83
1/17/83
457
-------
COST SUMMARY
TAT CONTRACT
CONTRACTOR:
CONTRACT NO:
DATES OP WORK: April 1980 to September 1982
SUMMARY OF WORK: Assist in obtaining liquid samples; identify containers
by label; maintain logs; identify dangerous materials; evaluate direction
of ground water flow; sample bulk storage tanks; assist OSC in labeling,
packaging and shipping ground water samples; asdsist OSC in resupplying
carbon filter on site and return equipment to EDO; accompany various
conpany representatives on site to insure compliance with site safety
plans; determine type and size of treatment system that will treat
run off fron site; assist in monitoring the installation of the waste
water treatment system on site; prepare a complete listing of generators;
dates wastes were received on site, location of wastes and types of wastes,
TOTAL CONTRACTOR COST: 547,560.11
DOCUMENTATION: Contractor Cost Summary
Copies of Applicable Paid Invoices and Treasury Schedules
458
-------
10/22/84
TAT CONTRACT
VOUCHER NO.
26
25
28
27
29
29
31
33
32
34
35
36
38
37
40
41
42
43
45
44
46
48
47
49
50
52
53
54
55
56
51
58
57
61
64
63
62
66
65
67
68
69
71
70
TCUCHER DATE
5/30/80
5/14/80
6/24/80
6/11/80
6/24/80
7/8/80
7/8/80
8/20/80
8/6/80
8/25/80
9/5/80
9/18/80
10/14/80
10/3/80
10/21/80
10/28/80
11/11/80
11/26/80
12/9/80
12/2/80
12/22/80
1/19/81
1/5/81
2/2/81
2/17/81
3/2/81
3/2/81
3/18/81
3/30/81
3/27/81
3/2/81
4/27/81
4/13/81
5/26/81
6/22/81
6/8/81
6/8/81
7/20/81
7/9/81
8/5/81
8/19/81
8/21/84
9/16/81
9/1/81
VOUCHERS
VOUCHER AMOUNT* TREASURY NO. AND DATE
108,763.00
159,552.00
133,815.00
164,264.00
36,669.00
131,115.00
262,222.00
132,805.00
214,630.00
32,036.00
117,569.00
110,278.00
128,723.00
99,817.00
10,936.70
166,475.00
166,852.00
142,456.00
104,291.00
66,871.00
112,166.00
123,652.00
98,717.00
165,630.00
149,245.00
171,381.00
69,964.00
118,873.00
150,155.00
2,454.00
7,704.00
116,745.00
131,541.00
115,910.00
124,746.00
125,268.00
62,372.00
109,331.00
130,857.00
132,947.00
58,903.00
146,415.00
141,406.00
104,401,00
7258
7237
7311
7276
7311
7299
7342
7359
7359
7359
7359
7379
7031
7021
7045
7045
7045
7063
7060
7072
7082
7128
7101
7144
7186
7191
7191
7707
7207
7253
7191
7293
7262
7336
7364
7364
7364
7418
7403
7423
7443
7443
7034
7022
6/4/80
5/15/80
7/21/80
6/18/80
7/21/80
7/11/80
8/21/80
9/8/30
9/8/80
9/8/80
9/8/80
9/23/80
11/04/80
10/24/80
11/18/80
11/18/80
11/18/80
12/12/80
7/12/81
12/24/80
1/13/81
2/81
2/23/81
3/2/81
3/19/81
3/23/81
3/23/81
4/2/81
4/2/81
4/1/81
4/23/81
5/22/81
5/5/81
6/24/81
7/14/81
7/14/84
7/14/81
8/12/81
8/3/81
9/14/81
9/25/81
9/25/81
10/6/81
10/1/81
*NOTE: Vouchers are not paid site specific; they are paid lump sum payments
to an individual contractor for work performed during that period of time.
459
-------
-2-
TAT -
VOUCHERS CONTINUED
72
74
76
73
78
77
81
79
80
82
83
84
85
88
87
86
91
92
90
93
94
96
97
98
99
104
9/29/81
10/5/81
10/27/81
10/5/81
11/23/81
11/10/81
12/21/81
12/8/81
12/8/81
1/5/82
1/19/82
2/1/82
2/16/82
3/19/82
3/16/82
3/3/82
4/27/82
4/28/82
4/13/82
5/12/82
5/26/82
6/17/82
6/22/82
7/7/82
7/21/82
9/24/82
128,963.00
344,422.00
203,384.00
22,108.00
235,030.00
257,030.00
232,501.00
60,773.00
254,402.00
169,172.00
277,092.00
289,555.00
344,129.00
64,230.00
685,342.00
274,258.00
335,501.00
255.00
354,947.00
283,331.00
249,818.00
200,146.00
318,658.00
271,767.00
266,989.00
203,471.00
7076
7076
7076
7076
7182
7131
7204
7182
7182
7252
7231
7270
7290
7362
7338
7336
7442
7414
7414
7467
7506
7544
7553
7586
7610
7062
11/3/81
11/3/81
11/3/81
11/3/81
1/13/82
2/2/82
2/3/82
1/13/82
1/13/82
2/11/82
2/15/82
3/8/82
3/17/82
4/20/82
4/13/82
4/9/82
5/19/82
5/14/82
5/11/82
6/9/82
6/25/82
7/12/82
7/14/82
8/2/82
8/13/82
10/22/82
460
-------
COST SUMMARY
osc LET CONTRACT
CONTRACTOR:
CONTRACT NO:
DATES OF WORK: August 1982
SUMMARY OF WDRX: Place aggregate in filter tanks; install back flush
and inffluent lines, sump pumps; interconnecting pipking, install
carton and pea gravel neve tank; fabricate and install under drain,
place pea gravel.
INVOICE INVOICE TREASURY NUMBER
NUMBER AMOUNT AND DATE
8252 $11,999.26 less 5% = $11,399.30 7014 10/14/82
8252 5% returned (final) = 539.21 7197 2/28/82
TOTAL CONTRACTOR COST: Sll,<»38.51
DOCUMENTATION: FMD SPUR Report, dated June 30, 1984
Copiesd of Applicable Paid Invoices and Treasury Schedules
461
-------
ODST SUMMAKf
OVERFLIGHTS
CONTRACTOR: Environmental Monitoring Systems Laboratory
PROTECT NO: AMD 83039
SUMMARY OF WORK: Aerial photography and analysis support
TOTAL CONTRACTOR GOST: $10,980.00
DOCUMENTATION: Contractor Cost Surmary, dated 4/2/84
462
-------
COST SUMMARY
IKTERAGENCY AGREEMENTS
AGENCY: Department of Justice
IAG NO: AD15F2A090
SUMMARY OF WORK:
TOTAL IAG COST:
n Litigation
VOUCHER
NUMBER
2R00517
2R00362
3R00103
3R00471
VOUCHER
AMOUNT
S 241
383,
439,
102,
191,
,739
571.
786.
594.
586.
.82
85
81
87
60
DATES OF
SERVICE
1st
2nd
3rd
4th
4th
Oct
Qtr.
Otr.
Qtr.
Otr.
Otr.
./Nov
FY
FY
FY
FY
FY
82
82
82
82
82
. 1982
IAG VOUCHER
AMOUNT
$ 1
11
69
10
16
,861.48
465.37
,066
,663
,945
,044
.81
.70
.41
.21
5110,046.98
DOCUMENTATION: FMD SPUR Report, dated June 30, 1984
Copies of Applicable Vouchers of withdrawal
463
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APPENDIX F
INFORMATION COVERED BY THE PRIVACY ACT
The following list identifies those types of personal
information that must be redacted before cost documentation
may be produced durinq discovery or at trial. It must be noted
that this list is not all-inclusive. Because of the widely
varyino types of invoices, vouchers, forms and other documents
that will be produced, there may be other types of information,
not identified here, that are entitled to be withheld from
disclosure.
0 Social Security Numbers
4 Credit card numbers
• Type of credit card (as indicated on either the
card imprint, on the pre-printed form, or hand
written)
0 Home address
0 Home telephone number
0 All non-business calls (place and number called,
time, amount, and bill total) on personal telephone
bill
* Driver's license number
0 Comments on travel voucher such as "Stayed with
Relatives"
0 Annual and sick leave balances
0 Timecard or timesheet comments
0 Coded information on front of timecard
In addition, as noted in the text, all information relating
to sites other than the one for which the documentation is to
be produced should be redacted. This typically invloves only
timesheets, timecards and travel vouchers.
464
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APPENDIX G
SAMPLE STIPULATION/PROTECTIVE ORDER
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF
UNITES STATES OF AMERICA,
Plaintiff,
Civil Action No,
v.
Defendants
STIPULATION AND PROTECTIVE ORDER
Plaintiff United States of America and defendants
have hereby stipulated that discovery in this
case will necessarily involve production of confidential
commercial and financial information. In view of this
stipulation, the Court finds that good cause exists for issuance
of a protective order. Upon consideration of the joint motion
for such an order filed by these parties, and pursuant to Rule
26(c), Federal Rules of Civil Procedure, IT IS HEREBY ORDERED:
465
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1. The United States may desiqnate as "confidential
material" all or any part of: (1) its answers to interrogatories;
(ii) transcripts of depositions of its officers, directors,
employees, agents, and representatives; (iii) documents produced
by it; and (iv) any other discovery or disclosure made by it in
this litigation. The United States of America will make that
designation only after a bona fide determination that the
material contains "confidential information." As used in this
order, the term "confidential information" means proprietary
technical or commercial information designated as such by a
party producing such information, and constituting trade secrets,
confidential know-how, proprietary information, and the like,
which relates to a product or products or a commercial operation
used or proposed to be used, or which relates to or contains
financial, research or commercial information Generated by
said party.
2t The designation of confidential material shall be
made in accordance with Paragraph 3 of this order, shall occur
prior to, or contemporaneously with, the production or disclosure
of that material or information, and shall be binding upon all
parties subject to Paragraph 9 of this Stipulation and Protective
Order.
466
-------
3. Any document, any written statement, and any transcript,
copy, excerpt, synopsis, summary or note pertaininq to any such
document or statement, or to any oral statement, which contains
confidential information shall be stamped conspicuously with
the word "CONFIDENTIAL" prior to production. A party producing
"CONFIDENTIAL" documents will segregate the documents as to
which confidentiality is claimed, provide a list of said documents,
or otherwise "flag" the documents so that other parties are
notified of the claims. The designation and transmittal of
confidential material shall be made by letter from the plaintiff
properly indicating that those documents which are confidential
are subject to this Protective Order.
4. Any party may object to matter marked "CONFIDENTIAL"
by the United States and may apply to the Court for an order
removing such confidentiality at any time following production
of the document or thing in guestion, provided, however: (i)
the party making such application shall comply with [applicable
local rule, if any] in connection therewith; and (ii) nothing
in this paragraph shall alter the burden of proof which otherwise
would apply to a determination whether the particular claim of
confidentiality is justified. Material or information claimed
467
-------
to be confidential that is subject to a dispute as to whether
it is in fact confidential material or information shall,
until further order of the Court, be treated as confidential
in accordance with the provisions of this Stipulation and
Protective Order.
5. Material or information designated confidential under
this Stipulation and Protective Order shall not be used or
disclosed by any oarty for business or competitive purposes, or
for any purpose whatsoever other than for the preparation for,
and trial of, this action and any appeal therein.
6. Counsel for the party who obtains material or
information designated confidential under this Stipulation and
Protective Order from the United States of America, or counsel
for any other party or any person or entity not a party, shall
not disclose or permit disclosure of this material or information
to any other person or entity, including without limitation any
officer, director, employee, aqent, or representative of the
party who obtained disclosure, except in the following
circumstances:
a. Disclosure may be made to employees of counsel
who have a direct functional responsibility for the preparation
and trial of this action or any appeal therein. Any employee
to whom disclosure is made shall be advised of, and become
468
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subject to, the provisions of this Stipulation and Protective
Order requiring that the material and information be held in
confidence. A list of such employees must be furnished to
counsel for the party asserting confidentiality five (5) business
days before disclosure is made. Counsel for a party includes
in-house counsel. Employees do not include persons, firms or
corporations engaged by counsel on a contract basis, who shall be
subject to the requirements of Paragraphs 6(b) and 6(c) of this
Stipulation and Protective Order.
b. Disclosure may be made to consultants or experts
("Exoert(s)") employed by a party or counsel to a party to
assist counsel in the preparation and trial of this litigation.
Prior to disclosure to any Expert, the Expert must agree to be
bound by the terms of this Stipulation and Protective Order by
executing the Confidentiality Agreement annexed hereto as
Exhibit A ("Agreement"), and he must be identified in writing
to counsel for the party asserting confidentiality not less
than ten (10) business days before disclosure is made to the
Expert. Identification of the expert shall include the expert's
name, business address, telephone number and the name(s) of
companies for which he is currently employed and by whom he
may have been employed for the period of one year prior to his
disclosure. A copy of each executed Aareement shall be furnished
not less than five (5) business days prior to disclosure to
469
-------
- .6 -
the Expert to counsel for the party claiming confidentiality
under this Stipulation and Protective Order. If counsel for
the party asserting confidentiality objects to disclosure to
any Expert, then disclosure shall not then be made. Any dispute
in connection with disclosure of material or information claimed
to be confidential shall be presented to the Court for
determination.
c. In connection with any proceeding in this action,
disclosure may be made to witnessess who are officers, directors,
employees, agents, representatives, or Experts to the party who
designated the material or information as confidential. With
respect to any other person who is a witness or Expert witness,
disclosure shall not be made unless and until that person agrees
to be bound by the terms of this Stipulation and Protective
Order by executing the Agreement described in subparagraoh (b)
above, and that person is identified in writing to counsel for
the party asserting confidentiality not less than ten (10)
business days before disclosure is made to the witness or Expert
witness prior to the date set for the proceeding. Identification
shall include that information outlined in Paragraph 6(b) of
this Stipulation and Protective Order. If counsel for the
party asserting confidentiality objects to disclosure to any
person who is a witness or Expert witness, then disclosure
470
-------
- 7 -
shall not be made. Any dispute in connection with disclosure
of material or information claimed to be confidential shall be
presented to the Court for determination.
7. Counsel for any party who obtains material or
information designated confidential under this Stipulation and
Protective Order from any other party, counsel to any other
party, or any person or entity not a party shall keep that
material or information within its exclusive possession and
control and shall immediately place the material and information
in a secure and segregated facility. Except as provided in
Paragraph 6 abqve, no person shall have access to the foregoing
facility.
8. Each party, counsel for each party, and any
person, witness, Expert, or entity not a party to this action
who obtains access to material or information designated
confidential under this Stipulation and Protective Order shall
not make copies, duplicates, extracts, summaries, or descriptions
of the material or information or any portion thereof.
9. All depositions of persons with knowledge of cost
documentation and EPA contractor costs in this action shall be
held in the presence only of the deponent, officers of the Court,
including the reporter, representatives designated by the
Plaintiff, and persons described in Paragraph 6, above.
10. To the extent that any answers to interroaatories,
exhibits, transcripts of depositions, responses to requests for
471
-------
- a -
admission, or any other papers filed or to be filed with the
Court reveal/ may reveal, tend to reveal, or may tend to reveal
any information claimed to be confidential by any other party,
counsel to any other party, or any person or entity not a party,
such documents shall be filed in sealed envelopes or other
appropriate sealed containers on which shall be endorsed the
caption of this litigation, an indication of the nature of the
contents of such sealed envelope or other container, the word
"CONFIDENTIAL", and a statement substantially in the following
form:
"This envelope, containing documents
which are filed in this case by
, ("the producing
party") is not to be opened and
the contents are not to be displayed
or revealed except by order of the
Court or consent of the producing
party."
In additional, counsel for the party asserting confidentiality
should be so informed no less than ten (10) business days before
the date set for trial/ motion, or other proceeding. Upon the
request of the party or counsel for the party claiming
confidentiality, the evidence shall be submitted in camera and
shall be sealed, and any proceeding involving disclosure of the
evidence shall be held in camera.
11. Notwithstanding anything to the contrary, the
plaintiff is free to exhibit material or information designated
as confidential by that party to any person or entity not
472
-------
- 9 -
subject to the protective procedures set forth in this Stipulation
and Protective Order, and such exhibition shall not result in a
waiver of the claimed confidentiality.
12. Upon final termination of this action, whether
by judgment, settlement, or otherwise:
a. Counsel of record for each party, person,
and entity who obtained material or information claimed to be
confidential shall assemble and return to the party, person,
and entity or their counsel who disclosed the material or
information and claimed confidentiality therefor, all materials
in his or its possession or subject to his or its control that
reveal, may reveal, tend to reveal, or may tend to reveal
confidentical materials or information, except that all such
materials constituting the work product of counsel of record
shall be immediately destroyed; and
b. The Clerk of the Court shall maintain in
perpetuity under seal all papers filed under seal with the
Court, including, without limitation, transcripts of deposition
answers to interrogatories, responses to requests for admission,
motion papers, memoranda of law, documents, and exhibits as to
which material or information a claim of confidentiaity was
made .
473
-------
CONFIDENTIALITY AGREEMENT
The undersigned is currently working at
which is located at . During the past year
the undersigned has been employed by the following companies
located at the corresponding addresses:
The undersigned hereby acknowledges that he (she) has read
the foregoing Stipulation and Protective Order executed by the
attorneys of record for the parties of the action oresently
pending in the U.S. District Court for the District of
entitled United States v, , understands the
terns thereof, and agrees, upon threat of penalty of contempt, to
be bound hy such terras. The undersigned understands that documents
which have been designated as confidential are likely to cause
substantial harm to the applicable business' competitive position
if disclosed or handled in any manner other than that expressly
directed by the Stipulation and Protective Order. Among other
responsibilities, the undersigned shall keep the material within
his/her exclusive possession, place the material in a secure and
segregated facility, shall not make copies, duplicates, extracts,
summaries, or descriptions of the material or information or any
portion thereof, shall not disclose the information to persons
other than those specifically authorized by the protective order,
474
-------
- 2 -
and shall not use or disclose it for business or competitive
purposes. The undersigned understands that the pledge of secrecy
under this agreement continues after the lawsuit is over, and
extends to confidential information disclosed in the future as
well as to confidential information already disclosed to the
undersigned. Furthermore, the undersigned understands that a
breach of this Stipulation and Protective Order may constitute
contempt of court and may result in damage to the competitive
position of one or more private entities which may subject him
(her) and/or his (her) employee to civil claims for damages by
these entities.
Date: Signed:
475
-------
APPENDIX H
MODEL CONFIDENTIAL BUSINESS INFORMATION LETTER
Contractor
Address
City, State, Zip Code
Re: Disclosure of Contractor Information in the case of
U.S. v. ___^ ,
CERCLA Section 107 Cost Recovery Action
Dear Sir or Madam:
As you know, the United States Government, through the
Environmental Protection Agency, has contracted with your firm
to undertake certain activities to assist in hazardous waste
site cleanup under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (CERCLA). The United
States has commenced the above-referenced action against liable
parties seeking reimbursement of all expenses incurred and to
be incurred by the government and its contractors for work done
at the site.
To prove the costs incurred in cleanina up the site,
however, it is necessary to disclose certain documents during
the course of litigating CERCLA cost recovery actions. In
particular, all contractor documents in the possession of the
U.S. EPA might be required to be disclosed, including, but not
limited to:
(1) Paid processed invoices;
(2) Timesheets, timecards and other payroll expense
information;
476
-------
(3) Travel expense receipts;
(4) Equipment expense receipts;
(5) Summaries of hours, costs per hours, overhead
costs and subcontractor costs;
(6) Technical Directive Documents (TDDs) and TDD
Acknowledgements of completion (TDD-AOCs).
It is our understanding that certain information contained
in the documents noted above has been claimed as confidential
by your company under 40 C.F.R. Part ?.
The purpose of this letter is to give you an opportunity
to comment on our plan to make these documents available to the
defendants and the court, and to request your consent to that
release.
To protect the information, you have provided us, the
United States proposes the following procedures. Once a reguest
for production of documents is received that may reguire
confidential business information to be disclosed, we will
contact counsel for the party reouestina the documents to
determine if an agreement can be reached in which the documents
are released under the terms of a stipulation and protective
order. The stipulation and protective order will guarantee
that the documents will only be disclosed to certain persons or
parties for certain limited purposes and will reguire that
those persons or parties agree to sign a confidentiality agreement,
A copy of the stipulation and protective order we propose to
use is attached for your review.
477
-------
Once the order is entered and counsel for the party
requesting the information has executed the appropriate
confidentiality agreements, the information will be produced.
You will be notified when the documents are produced.
In the event that the requesting party declines to aqree
to production under the terms of a protective order, the United
States will either redact all confidential business information
and produce the documents or decline to produce the documents
altogether. In either case, the United States will be prepared
to submit memoranda to the court opposing production unless
under the terms of a protective order.
The Agency recognizes your need to keep certain information
confidential. We hope that this strategy will satisfy your
concerns.
Sincerely,
478
-------
APPENDIX I
EXAMPLE MOTION FOR PROTECTIVE ORDER
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF
UNITES STATES OF AMERICA,
Plaintiff,
Civil Action No,
v.
Defendants
JOINT MOTION OF PLAINTIFF, UNITED STATES OF AMERICA
AND DEFENDANT FOR A PROTECTIVE ORDER
Plaintiff United States of America ("the Government") and
defendant hereby move the Court to
enter a protective order in this case, pursuant to Rule 26(c),
Federal Rules of Civil Procedure. A Stipulation and Protective
Order is attached.
Discovery in this case will necessarily involve production
by the United States of financial information prepared and
submitted to it by its contractors. Those contractors would
be irreparably damaged by routine disclosure of this confidential
material and, accordingly, all parties urge the court to allow
the United States to impose the safeguards embodied in the
stipulation and proposed protective order.
479
-------
Administration of the provisions of the Stipulation and
Protective Order will be handled primarily by the parties and
should involve little, if any, Court time. The proposed order
contemplates an initial good faith designation of confidentiaity
by the United States. In the event that one or more defendants
object to the claim of confidentiality of particular information,
the Court will be asked to review the information JLn cam erg and
make a determination regarding production, if there is no
objection, however, the Court need not be involved at all. The
United States does not intend to indiscriminately mark every
document confidential and will exercise its best judgment and
put forth substantial efforts to minimize discovery disputes.
A protective order such as that urged by this motion will
enable the United States to respond fully to the Defendant's
discovery reauests and, at the same time, ensure that confidential
competitive and financial information will not be disseminated
in a manner inconsistent with the EPA contractors' business
interests or with the proper administration of justice.
WHEREFORE, the Government and the Defendant's respectfully
request the Court to sustain this motion and to enter the
Stipulation and Protective order attached.
Respectfully submitted,
480
-------
- 3 -
[Name]
United States Attorney
By:
[Name]
Assistant U.S. Attorney
[Address]
ATTORNEY FOR PLAINTIFF
By:
[Name]
[Address]
ATTORNEY FOR DEFENDANT
481
-------
Related Guidance
-------
* UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
• WASHINGTON. D.C. 20460
c
JUN 13 1984
OFFICE OF
EMfONCCMCNTANO
MEMORANDUM
SUBJECT: Liability of Corporate Shareholders and Successor
Corporations For Abandoned Sites Under the Compre-
hensive Environmental Response, Compensation, and
Liability Act (CERCLA)
raEor for Er
FROM: Courtney M. Price
Assistant Administral
and Compliance Monitoring
TO: Assistant Administrator for
Solid Waste and Emergency Response
Associate Enforcement Counsel for Waste
Regional Administrators
Regional Counsels
Introduction
The following enforcement memorandum, which was prepared
in cooperation with the Office of General Counsel, identifies
legal principles bearing on the extent to which corporate
shareholders and successor corporations nay be held liable
for response costs that arise as a result of a release of a
hazardous substance from an abandoned hazardous waste facility.
In the discussion section pertaining to each part, the memorandum
reviews the law on the subject from established traditional
jurisprudence to current evolving standards. Although general
rules of liability are delineated, these principles must be
carefully applied to the unique fact pattern of any given
case.
I. THE LIABILITY OF CORPORATE SHAREHOLDERS UNDER CERCLA
Background
Normally, it is the corporate entity that will be held
accountable for cleanup costs under CERCLA. In certain
484
-------
-2-
instances, however, EPA may want to extend liability to include
corporate shareholders. This may arise, for example, where a
corporation, which had owned or operated a waste disposal site
at the tine of the contamination, is no longer in business.
The situation may also occur if a corporation is still in'
existence, but does not have sufficient assets to reimburse
the fund for cleanup costs. There are two additional policy
reasons for extending liability to corporate shareholders.
First, this type of action would promote corporate responsibil-
ity for those shareholders who in fact control the corporate
decision-making process; it would also deter other shareholders
in similar situations from acting irresponsibly. Second, the
establishment of shareholder liability would aid the negotiation
process and motivate responsible parties toward settlement.
Traditional corporation law favors preserving the corporate
entity, thereby insulating shareholders from corporate liability.
Nevertheless, as will be discussed below, there are exceptions
to this general principle that would allow a court to disregard
corporate form and impose liability under CERCLA on individual
shareholders.
Issue
What is the extent of liability for a corporate share-
holder under CCRCLA for response costs .that arise as a result
of a release of a hazardous substance from an abandoned hazardous
waste facility?
Summary
The question of whether EPA can hold a shareholder of a
corporation liable under CERCLA is a decision that must turn
on the unique facts specific to given situation. Generally,
however, in the interests of oublic convenience, fairness, and
equity, EPA may disregard the eorporat*s entity when the shareholder
controlled or directed the activities of a corporate hazardous
waste generator, transporter, or facility.
Discussion
Section 107(a)(2) of CERCLA provides that any owner or
operator of a facility which releases a hazardous substance
shall be liable for all necessary response costs resulting
from such a release. Section 101(20)(A)(iii) of CERCLA clearly
states that the term "owner or operator" as applied to abandoned
facilities includes "any person who owned, operated, or otherwise
485
-------
-3-
controlled activities at such facility immediately prior to
such abandonment* (emphasis added).
In addition, Sections 107(a)(3) and 107(a)(4) of CERCLA
impose liability for response costs on any person who arranged
for the disposal or treatment of a hazardous substance (the
generator), as well as any person who accepted a hazardous
substance for transport to the disposal or treatment facility
(the transporter).
The term "person* is defined in CERCLA Section 101(21)
as, inter alia, an individual, firm, corporation, association,
partnership, or commercial entity. A shareholder may exist
as any of the forms mentioned in Section 101(21). Therefore, a
shareholder may be considered a person under CERCLA and, conse-
quently, held liable for response costs incurred as a result
of a release of a hazardous substance from a CERCLA facility
if the shareholders
' Owned, operated, or otherwise controlled activities
at such facility immediately prior to abandonment
(CERCLA Section 107(a)(2); Section 101(20)(A)(iii)];
• Arranged for the disposal or treatment (or
arranged with a transporter for the disposal or
treatment) of the hazardous substance [CERCLA
Section 107(a)(3)]; or
* Accepted the hazardous substance for transport to
the disposal or treatment facility selected by such
person (CERCLA Section 107(a)(4)].
Notwithstanding CERCLA*s statutory language, courts
normally seek to preserve the corporate form and thus maintain
the principle of limited liability for its shareholders. V
In fact, fundamental "to the theory of corporation law is
the concept that a corporation is a Legal separate entity, a
legal being having an existence separate and distinct from
I/ See Pardo v. Wilson Line of Washington, Inc., 414 F.2d
~~ TTJS, 1149 (D.C. Cir. 1969); Krivo Industrial Supply Co.
v. National Distillers t Chem. Corp., 483 F.2d 1098,
1102 (5th Cir. 1973), modified per curiam, 490 F.2d 916
(5th Cir. 1974); Homan and Crimen, Inc. v. Harris, 626
P.2d 1201, 1208 (5th Cir. 1980).
486
-------
-4-
that of its owners." 2/ This concept permits corporate
shareholders "to limi£ their personal liability to the extent
of their investment." */ Thus, although a shareholder may
be considered a "person" under CERCLA (and therefore subject
to the Act's liability provisions), the application of corporate
law would tend to shield the shareholder from such liability.
Nevertheless, a court may find that the statutory language
itself is sufficient to impose shareholder liability notwith-
standing corporation law. V Alternatively, to establish
shareholder liability, a court may find that the general prin-
ciples of corporation law apply but, nonetheless, set aside
the limited liability principle through the application of
the equitable doctrine of "piercing the corporate veil."
Simply stated, the doctrine of piercing the corporate
veil refers to the process of disregarding the corporate
/ Krivo Industrial Supply Co. v. National Distillers & Chem.
" Corp., 483 F.2d 1098, 1102 (5th Cir. 1973), modified per
curiam, 490 F.2d 916 (5th Cir. 1974).
I/ II-
See United States v. Northeastern Pharmaceutical and
Chemical Company, Inc., et al., 80-5066-CV-S-4, memorandum
op. (W.D. Mo., 1984). In Northeastern Pharmaceutical the
district court noted that a literal reading of Section
101(20)(A) "provides that a person who owns interest in a
facility and is actively participating in its management
can be held liable for the disposal of hazardous waste."
(Memorandum op. at 36.) The court went on to find that
there was sufficient evidence to impose liability on one
of the defendants pursuant to this statutory definition
of "owner and operator," and the Section 107(a)(l) liability
provision of the Act. The fact that the defendant was a
major stockholder did not necessitate the application of
corporate law, and thus the principle of limited liability:
"To hold otherwise and allow [the defendant] to be shielded
by the corporate veil 'would frustrate congressional purpose
by exempting from the operation of the Act a large class
of persons who are uniquely qualified to assume the burden
imposed by [CERCLA].'" (Memorandum op. at 37, citation
omitted.)
487
-------
-5-
entity to hold either corporate shareholders or specific
individuals liable for corporate activities. £/
In order to determine whether to disregard corporate form
and thereby pierce the corporate veil, courts generally have
sought to establish two primary elements. £/ First, that the
corporation and the shareholder share such a unity of interest
and ownership between them that the two no longer exist as
distinct entities. V Second, that a failure to disregard the
corporate form would" create an inequitable result.
The first element may be established by demonstrating
that the corporation was controlled by an "alter ego." This
would not include "mere majority or complete stock control,
but complete domination, not only of finances, but of policy
and business practice in respect to the transaction attacked
V See Henn, LAW OF CORPORATIONS 55143, 146 (1961). This
~~ doctrine applies with equal force to parent-subsidiary
relationships (i.e., where one corporation owns the
controlling stock of another corporation).
£/ Generally, courts have sought to establish these elements
in the context of various theories, such as the "identity,
•instrumentality," "alter ego," and "agency" theories.
Although these terms actually suggest different concepts,
each employs similiar criteria for deciding whether to
pierce the corporate veil.
1/ See United States v. Standard Beauty Supply Stores,
~~ Inc., 561 F.2d 774, 777 (9th Cir. 1977)iFMC Fin. Corp.
v. Murphree, 632 F.2d 413, 422 (5th Cir. 1980).
£/ See Automotriz Del Golfo de Cal. 5.A. v. Resnick, 47 Cal.
2d 792, 796, 306 P.2d 1 (1957); DeWitt Truck Broker, Inc.
v. W. Ray Flemming Fruit Co., 540 F.2d 681, 689 (4th
Cir. 1976). Some jurisdictions require a third element
for piercing the corporate veil: that the corporate
structure must have worked an injustice on, or was the
proximate cause of injury to, the party seeking relief.
See e.g., Berger v. Columbia Broadcasting System, Inc.,
453 F.2d 991, 995 (5th Cir. 1972), cert, denied, 409
U.S. 848, 93 S.Ct. 54, 34 L.Ed.2d 89 (1972); Lowendahl
v. Baltimore i O.R.R., 247 A.D. 144, 287 N.Y.S. 62, 76
(1936), aff'd 272 N.Y. 360, 6 N.E.2d 56 (Ct. App. 1936),
but see, Brunswick Corp. v. Waxman, 599 F.2d 34, 35-36
(2d Cir. 1979).
488
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-6-
so that the corporate entity as to this transaction had at the
time no separate mind, will or existence of its own." £/
In analyzing this first element, courts have generally
considered the degree to which corporate 'formalities have
been followed [so as] to maintain a separate corporate iden-
tity." *°/ For example, the corporate veil has been pierced
in instances where there had been a failure to maintain adequate
corporate records, or where corporate finances had not been
kept separate from personal accounts.
The second element of the test is satisfied when the
failure to disregard the corporate entity would result in
fraud or injustice, j^/ This would occur, for example, in
cases where there has been a failure to adequately capital-
ize for the debts normally assocated with the business
undertaking, ££/ or where the corporate form has been employed
to misrepresent or defraud a creditor. *V
'/ Berger v. Columbia Broadcasting System, Inc., 453 F.2d
"" 991, 995 (5th Cir. 1972), cert, denied, 409 U.S. 848,
93 S.Ct. 54, 34 L.Ed.2d 89 (1972).
10/ Labadie Coal Co. v. Black, 672 F.2d 92, 96 (D.C. Cir.
1982); See DeWitt Truck Broker, Inc. v. W. Ray Flemming
Fruit Co., 540 F.2d 681, 686 n. 14 (collecting cases)
(4th Cir. 1976).
ll/ Lakota Girl Scout C., Inc. v. Havey Fund-Rais. Man., Inc.,
519 F.2d 634, 638 (8th Cir. 1975); Dudley v. Smith, 504
F.2d 979, 982 (5th Cir. 1974).
12/ Some courts require that there be actual fraud or injustice
akin to fraud. See Chengelis v. Cenco Instruments Corp.,
386 F. Supp 862 (W.D. Pa.) aff*d mem., 523 F.2d 1050 (3d
Cir. 1975). Most jurisdictions do not require proof of
actual fraud. See DeWitt Truck Brokers v. W. Ray Flemming
Fruit Co., 540 F.2d 681, 684 (4th Cir. 1976).
13/ see Anderson v. Abbot, 321 U.S. 349, 362, 64 S.Ct. 531,
8T~L.Ed. 793 (1944); Machinery Rental, Inc. v. Herpel
(In re Multiponics, Inc.), 622 F.2d 709, 717 (5th Cir.
1980).
14/ See FMC Fin. Corp. v. Murphree, 632 F.2d 413, 423 (5th
CT?. 1980).
489
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-7-
In applying the dual analysis, courts act under consider-
ations of equity; therefore, the question of whether the
corporate veil will be lifted is largely one of fact, unique
to a given set of circumstances. However, the substantive
law applicable to a case may also have great importance. For
example, in applying state corporation law, state courts have
been generally reluctant to pierce the corporate veil. 15/
Federal courts, however, in applying federal standards, "Fave
shown more willingness to disregard the corporate entity and
hold individuals liable for corporate actions.
In many instances federal decisions do draw upon state
law and state interpretations of common law for guidance. 17
However, federal courts that are involved with federal
question litigation are not bound by state substantive law
or rulings. 1B/ In such cases, either federal common law
See discussion in Note, Piercing the Corporate Law Veil;
The Alter Ego Doctrine Under Federal Common Law, 95
Harvard L.R. 853, 855 (1982).
It is well settled that a corporate entity must be dis-
regarded whenever it was formed or used to circumvent
the provisions of a statute. See United States v. Lehigh
Valley R.R., 220 U.S. 257, 259, 31 S.Ct. 387, 55 L.Ed.
458 (1911); Schenley Distillers Corp. v. United States,
326 U.S. 432, 437, 66 S.Ct. 247, 90 L.Ed. 181 (1945);
Kavanaugh v. Ford Motor Co., 353 F.2d 710, 717 (7th
Cir. 1965); Casanova Guns, Inc. v. Connally, 454 F.2d
1320, 1322 (7th Cir. 1972).
See Seymour v. Hull t Horeland Eng'g, 605 F.2d 1105 (9th
Cir. 1979); Rules of Decision Act, 28 U.S.C. $1652 (1976).
Generally, federal courts will adopt state law when to
do so is reasonable and not contrary to existing federal
policy. United States v. Polizzi, 500 F.2d 856, 907 (1974).
See also discussion in note 19, infra.
UNITED STATES CONSTITUTION art. VI, cl. 2.
490
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-8-
or specific statutory directives may determine whether or not
to pierce the corporate veil. 19/
li/ See_ Anderson v. Abbot, 321 U.S. 349, 642 S.Ct. 531, 88
L.Ed. 793 (1944); Town of Brookline v. Gorsuch, 667 F.2d
215, 221 (1981). For a general discussion of federal
common law and piercing the corporate veil see, note 15,
supra. The decision as to whether to apply state law or
a federal standard is dependent on many factors:
•These factors include the extent to which: (1) a
need exists for national .uniformity; (2) a federal
rule would disrupt commercial relationships predicated
on state law; (3) application of state law would
frustrate specific objectives of the federal program;
(4) implementation of a particular rule would cause
administrative hardships or would aid in administrative
conveniences; (5) the regulations lend weight to the
application of a uniform rule; (6) .the action in
question has a direct effect on financial obligations
of the United States; and 17) substantial federal
interest in the outcome of the litigation exists.
Even with the use of these factors, however, whether
state law will be adopted as the federal rule or
a unique federal uniform rule of decision will be
formulated remains unclear. The courts have failed
to either mention the applicable law or to state the
underlying rationale for their choice of which law to
apply." Note, Piercing the Corporate Veil in Federal
Courts; Is Circumvention of a Statute Enough?, 13 Pac.
L.J. 1245, 1249 (1982) (citations omitted).
In discussions concerning. CERCLA the courts and Congress
have addressed several of the above mentioned factors.
CERCLA. For example, the need for national uniformity to
carry out the federal superfund program has been clearly
stated in United States v. Chem-Dyne, C-l-82-840, slip op.
(S.D. Ohio, Oct. 11, 1983). In Chem-Dyne, the court stated
that the purpose of CERCLA was to ensure the development
of a uniform rule of law, and the court pointed out the
dangers of a variable standard on hazardous waste disposal
practices that are clearly interstate. (Slip op. at
11-13.) See also, Ohio v. Georgeoff, 562 F. Supp. 1300,
491
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-9-
The general rule applied by federal courts to cases in-
volving federal statutes is that "a corporate entity may be
disregarded in the interests of public convenience, fairness
and equity.* 20/ In applying this rule, "federal courts
will look closely at the purpose of the federal statute to
determine whether that statute places importance on the
corporate form." 21/ Furthermore, where a statute contains
specific directives on when the corporate entity may be
disregarded and individuals held liable for the acts or debts
of a valid corporation, courts must defer to the congressional
mandate. 22/
Thus, even under general principles of corporation law,
courts may consider the language of statute in determining
whether to impose liability on corporate shareholders.
Therefore, a court may use the statutory language of CERCLA
either as a rationale for piercing a corporate veil (when
corporation law is applied) or as an independent statutory
basis for imposing liability (notwithstanding the general
principles of corporation law). 23/
19 (continued)/
1312 (N.D. Ohio, 1983); 126 Cong. Rec. H. 11,787 (Dec.
3, 1983).
The Chem-Dyne court stated that "the improper disposal
or release of hazardous substances is an enormous and
complex problem of national magnitude involving uniquely
federal interests." (Slip op. at 11.) The court further
noted that "a driving force toward the development of
CERCLA was the recognition that a response to this
pervasive condition at the State level was generally
inadequate: and that the United States has a unique
federal financial interest in the? trust fund that is
funded by general and exCise taxis." (Slip op. at 11,
citingr 5 U.S. Code Cong, fc Ad. News at 6,142.) See
also, 126 Cong. Rec. at H. 11,801.
20/ capital Telephone Company, Inc. v. F.C.C., 498 F.2d 734,
738 (D.C. Cir. 1974).'
£!/ Town of Brookline v. Gorsuch, 667 F.2d 215, 221 (1981).
22/ Anderson v. Abbot, 321 U.S. 349, 365, 64 S.Ct. 531,
88 L.Ed 793 (1944).
See discussion, supra, note 4.
492
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-10-
Conclusion
The Agency should rely upon the statutory language of the
Act as the basis for imposing liability on any person who
controlled or directed the activities of a hazardous waste
facility immediately prior to abandonment, or on any person
who is a generator or transporter, notwithstanding the fact
that that individual is a shareholder. Additionally, and
alternatively, the Agency may rely on the general principles
of corporation law to pierce the corporate veil by applying
the current federal standard of public convenience, fairness,
and equity. However, when seeking to pierce the corporate
veil, the Agency should be prepared to apply the traditional
dual test previously discussed in order to provide additional
support for extending liability to corporate shareholders.
II. THE LIABILITY OF SUCCESSOR CORPORATIONS UNDER CERCLA
Background
Section 107(a)(2) of CERCLA extends liability for response
costs to "any person who at the time of disposal of any hazardous
substance owned or operated any facility at which such hazardous
substances were disposed of." Situations may arise, however,
where a corporation, which previously had owned or operated a
hazardous waste facility, now transfers corporate ownership to
another corporation. In such cases, it is important to determine
whether the liability of the predecessor corporation's action
regarding the disposal of hazardous waste is also transferred
to the successor corporation. ££/
Issue
What is the extent of liability for successor corporations
under CERCLA?
24/ The discussion that follows is equally applicable to
successor corporations of generators and transporters
associated with hazardous substances released from CERCLA
facility.
493
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-11-
Summary
When corporate ownership is transferred from one cor-
poration to another, the successor corporation is liable for
the acts of its predecessor if the new corporation acquired
ownership by merger or consolidation. If, however, the
acquisition was through the sale or transfer of assets, the
successor corporation is not liable unless:
a) The purchasing corporation expressly or
impliedly agrees to assume such obligations;
b) The transaction amounts to a "de facto* consoli-
dation or mergeri
c) The purchasing corporation is merely a continu-
ation of the selling corporation; or
d) The transaction was fraudulently entered into
in order to escape liability.
Notwithstanding the above criteria, a successor corpora-
tion may be held liable for the acts of the predecessor
corporation if the new corporation continues substantially
the same business operations as the selling corporation.
Discussion
The liability of a successor corporation, according to
traditional corporation law. is dependent on the structure of
the corporate acquistion. ££/ Corporate ownership may be
transferred in one of three ways: 1) through the sale of stock
to another corporation; 2) by a merger or consolidation with
another corporation; or 3) by the sale of its assets to another
corporation. 26/ Where a corporation is acquired through the
•purchase of aTl of its outstanding stock, the corporate
entity remains intact and retains its liabilities, despite
See N.J. Transp, Dep't v. PSC Resources, Inc., 175 N.J.
Super. 447, 419 A.2d 1151 (Super. Ct. Law Div. 1980).
26/ Note, Torts - Product Liability - Successor Corporation
Strictly Liable for Defective Products Manufactured by
the Predecessor Corporation, 27 Villanova L.R. 411, 412
(1980) (citations omitted) [hereinafter cited as Note,
Torts - Product Liability].
494
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-12-
the change of ownership." / jjy the same token, a purchasing
corporation retains liability for claims against the predecessor
company if the transaction is in the form of a merger or con-
solidation. 38/ where, however, the acquisition is in the form
of a sale or other transferance of all of a corporation's assets
to a successor corporation, the latter is not liable for the
debts and liabilities of the predecessor corporation. *V
There are four exceptions to this general rule of non-
liability in asset acquisitions. A successor corporation
is liable for the actions of its predecessor corporation if
one of the following is shown:
1) The purchaser expressly or impliedly
agrees to assume such obligations;
2) The transaction amounts to a "de facto"
consolidation or merger;
3) The purchasing corporation is merely a
continuation of the selling corpor-
ation; or
4) The transaction is entered into fraudulently
in order to escape liability. 30/
The application of the traditional corporate law approach
to successor liability has in many instances led to particularly
27/ N.J. Transp. Dep*t v. PSC Resources, Inc., 175 N.J.
Super. 447, 419 A.2d 1157 (Super. Ct. Law Div. 1980).
28/ id. A merger occurs when one of the combining corpor-
ations continues to exist; a consolidation exists when
all of the combining corporations are dissolved and an
entirely new corporation is formed.
29/ see N.J. Transp. Dep't v. PSC Resources, Inc., 175 N.J.
Super. 447, 419 A.2d 1151 (Super. Ct. Law Div. 1980),
citing, Jackson v. N.J. Manu. Ins. Co., 166 N.J. Super.
488, 454 (Super. Ct. APP. Div. 1979), cert, denied, 81
N.J. 330 (1979).
30/ id.. Note, Torts - Product Liability, supra note, 26 at
413 n. 15-18.
495
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-13-
harsh and unjust results, especially with respect to product
liability cases. 3V Therefore, in an effort to provide an
adequate remedy and to protect injured consumers, courts
have broadened the exemptions to the general rule by either
modifying or recasting the "de facto" and "mere continuation"
exemptions to include an element of public policy. 32/
More recently, however, the general rule has been aban-
doned altogether by several jurisdictions and, in essence, a
new theory for establishing successor liability has evolved
based upon the similarity of business operations. 33/ The
new approach has been cast by one court in the following way:
"[W]here...the successor corporation acquires
all or substantially all of the assets of the
predecessor corporation for cash and continues
31/ see McKee v. Harris-Seybold Co., 109 N.J. Super. 555,
264 A.2d 98 (Super. Ct. Law Div. 1970), aff'd per curiam,
118 N.J. Super. 480, 288 A.2d 585 (Super. Ct. App. Div.
1972); Kloberdanz v. Joy Mfg. Co., 288 F.Supp. 817 (D.
Colo. 1968).
32/ See N.J. Transp. Dep't v. PSC Resources, Inc., 175 N.J.
Super. 447, 419 A.2d 1151 (Super. Ct. Law Div. 1980)?
See also, Knapp v. North Am. Rockwell Corp., 506 F.2d
361 (3d Cir. 1974), cert, denied, 421 U.S. 965 (1975);
Cyjr v. B. Offen fc Co., 501 F.2d 1145 (1st Cir. 1975);
Turner v. Bituminous Gas Co., 397 Mich. 406, 244 N.W.2d
873 (1976).
33/ The theory has also been referred to as the "product-
line" approach. In adopting this new approach to
successor liability, some courts have abandoned the
traditional rule of non-liability in asset acquisitions.
See e.g., Ray v. Alad Corp., 19 Cal. 3d 22, 560 P.2d
3, 136 Cal. Rptr. 574 (1977). Other courts have con-
sidered the new approach as an exemption to the general
rule. See e.g., Daweko v. Jorgensen Steel Co., 290 Pa.
Super. Ct. 15, 434 A.2d 106 (1981); Note, Torts - Product
Liability, supra note, 26 at 418 n. 38. And, a few
jurisdictions have rejected the new approach. See
Travis v. Harris Corp., 565 F.2d 443 (7th Cir. 1977);
Tucker v. Paxson Mach. Co., 645 F.2d 620 (8th Cir. 1981).
496
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-14-
essentially the same manufacturing operation
as the predecessor corporation the successor
remains liable for the products liability claims
of its predecessor.* 34/
This theory of establishing successor liability differs
from the "de facto" and "mere continuation" exemptions in that
the new approach does not examine whether there is a continuity
of corporate structure or ownership (e.g., whether the predecessor
and successor corporation share a common director or officer).
Instead, according to the new theory, liability will be imposed
if the successor corporation continues essentially the same
manufacturing or business operation as its predecessor corporation,
even if no continuity of ownership exists between them. 35/
Until recently, this new approach for establishing successor
liability was confined mostly to product liability cases.
However, a recent New Jersey decision extended its application
to the area of environmental torts. The Superior Court of New
Jersey, in N.J. Transportation Department v. PSC Resources,
Inc. 36/y rejected the traditional corporate approach to
successor liability where the defendant and its predecessor
corporation had allegedly discharged hazardous wastes. The
court reasoned that the underlying policy rationale for
abandonment of the traditional approach in defective product
cases is applicable to environmental torts. Therefore, the
court held that a corporation which purchased assets of another
corporation and engaged in the practice of discharging hazar-
dous waste into a state-owned lake is strictly liable for
present and previous discharges made by itself and the prede-
cessor corporation because the successor continued the same
waste disposal practice as its predecessor.
34/ Ramirez v. Amstead Indus., Inc., 171 N.J. Super. 261, 278,
408 A.2d 818 (Super. Ct. App. Div. 1979), aff'd, 86 N.J.
332, 431 A.2d 811 (1981).
35/ See Ray v. Alad Corp., 19 Cal. 3d 22, 560 P.2d 3, 136 Cal.
Rptr. 574 (1977); some form of acquisition, however, is
still required. See Meisal v. Modern Press, 97 Wash.
2d 403, 645 P.2d 693.
36/ 175 N.J. Super. 447, 419 A.2d 1151 (Super. Ct. Law Div.
1980);
497
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-15-
A similar "continuity of business operation" approach has
been used in cases involving statutory violations. *'/ The
Ninth Circuit, for example, held in a case involving the Federal
Insecticide, Fungicide, and Rodenticide Act [FIFRA] 38/r that
*EPAfs authority to extend liability to successor corporations
stems from the purpose of the statute it administers, which is
to regulate pesticides to protect the national environment.*
Furthermore, the court noted that *[t]he agency may pursue the
objectives of the Act by imposing successor liability where it
will facilitate enforcement of the Act." *°/ After establishing
that there had been violations of FIFRA by the predecessor
corporation, the court found that there was substantial continuity
of business operation between the predecessor and successor
corporations to warrant imposition of successor liability.
Although CERCLA is not primarily a regulatory statute,
public policy considerations and the legislative history of
the Act clearly Indicate that federal law would be applicable
to CERCLA situations involving successor liability. **/
Therefore, it is reasonable to assume that courts wouTd similarly
adopt the federal "continuity of business operation approach"
in cases involving CERCLA.
Conclusion
In establishing successor liability under CERCLA, the
See Golden State Bottling Co. v. NLRB, 414 U.S. 168, 94
S.Ct. 414, 38 L.Ed2d 388 (1973); Slack v. Havens, 522
F.2d 1091 (9th Cir. 1975).
f8/ 7 U.S.C. S136 et seq.
Oner II, Inc. v. United States E.viron. Protection
Agency, 597 F.2d 184, 186 (9th Cir. 1979).
Id.
1/ See discussion, supra, n. 19; One of Congress1 primary
concerns in enacting CERCLA was to alleviate the vast
national health hazard created by inactive and abandoned
disposal sites. See e.g., Remarks of Rep. Florio, 126
Cong. Rec. H. 9,154 (Sept. 19, 1980), 126 Cong. Rec.
H. 11,773 (Dec. 3. 1980).
498
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-16-
Agency should initially utilize the "continuity of business
operation" approach of federal law. However, to provide
additional support or an alternative basis for successor
corporation liability, the Agency should be prepared to apply
the traditional exemptions to the general rule of non-liability
in asset acquisitions.
ccs A. James Barnes, General Counsel
499
-------
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
SEP2I&4
MEMORANDUM
SUBJECT;
FROM:
Issuance of Final Revised Guidance on the Use and
Issuance of Administrative Orders Under Section 7003
of the Resource Conservation and Recovery Act (RCRA)
Courtney M. Pricef*-^ ' K . T>«-Xa
Assistant Administrator'for Enforcement
and Compliance MoniTbring
TO:
Lee M. Thomas
Assistant Administrator for Solid Waste
and Emergency Response
See Attached List
Attached is the Final Revised Guidance on the Use and
Issuance of Administrative Orders Under Section 7003 of RCRA.
The responses to the drafts of this guidance were very
positive. A considerable effort has been made to incorporate
the comments received where appropriate. We greatly appreciate
your involvement in the development of this important policy.
If you have any questions, please contact Susan Conti, of
OECM-Waste, at FTS-382-3103.
Attachment
500
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-2-
for delegating a significant number of the FY 85 remedial actions
will he issued during the first quarter of FY 85.
Current policy requires a formal ROD for IRMs involving off-
site transport and disposal of wastes since specific determinations
(e.g., CEPCLA section 101(24)) are required. IRMs not involving
off-site disposal may be approved using the Action Memorandum
process. In these latter cases, the Action Memorandum should be
modified to include the necessary determinations required in a
ROD (e.g., the action is cost-effective, provides adequate protection
of public health, welfare, and the environment, and is in balance
with the resources of the Fund). All other remedial actions
(source control and off-site measures) will require a formal ROD.
In addition to the remedy selection criteria provided in
the NCP and the Feasibility Study Guidance, ROD and EDO decision
criteria will be developed in order to ensure national consistency
in the selection of Regional and Headquarters approved remedies.
To this end, we have established a process to document technical
and policy decisions for specific remedial actions made by the
Regional Administrators and the Assistant Administrator. Each
POD and EDD approved in Headquarters is being analyzed to identify
key subiect areas. An Issue Abstract will be prepared to explain
nolicy decisions made in each key area. The compilation of
these summaries will create a body of decision criteria for use
by Headquarters and Regional Offices. Headquarters will analyze
decisions made over time in specific subject areas to determine
if generic decision criteria should' be prepared.
Regions are responsible for the preparation and submission
to Headquarters for national distribution of Issue Abstracts for
all IRMs and other remedial actions approved in FY 85 by the
Regional Administrators. Issue Abstracts should clearly identify
the issues presented to the Regional Administrator during the
remedial alternative selection briefing and the resolution of
those issues. The abstract must use the approved format including
the identification of key words and must be reviewed and concurred
upon by the Office of Regional Counsel. A format and list of
key words are included in Attachment 1. The appropriate Zone
Manager in the Hazardous Site Control Division should be contacted
for site-specific assistance in Issue Abstract preparation.
POD APPROVAL PROCESS
The existina process for preparation of RODs at either State
or FPA-lead sites is for the Region (or State) to prepare a draft
POD following completion of a remedial investigation/feasibility
study (PI/FS). Figure 1 shows the general process for preparation,
review, and approval of RODs. Attachment 2 provides information
on POD format and content. The Region and State should review
the PI/FS to ensure that typical problem areas identified in with
the preferred remedy, and that the RI/FS addresses appropriate
501
-------
-3-
alternatives, including full technical compliance with other
environmental programs. The draft RI/FS should be reviewed
concurrently by State and Regional staff prior to start of the
public comment period. Other Federal agencies such as the Centers
for Disease Control (CDC), Federal Emergency Management Agency
(FEMA), or the Cores of Engineers (COE) should be involved in
RI/FS review, as appropriate.
A pre-ROD briefing for Headquarters management following
review of the draft RI/FS may be needed for technically complex
sites or when significant policy issues exist. For example, when
review of the draft RI/FS indicates that Fund-balancing may be
a basis for selecting a remedy that does not comply with the
relevant and applicable environmental requirements, a pre-ROD
briefing will always be required. Fund-balancing considerations
may require that the Region and State revise their recommended
remedial action prior to oreparation and approval of the ROD.
When Fund-balancing will not apply to a ROD, the Regional
Administrators can make the affirmative Fund-balancing determin-
ations required in the ROD Declaration (that the selected remedy
is in balance with amounts in the Fund) for delegated projects.
This determination can be made when the proposed project is on
the approved Superfund Comprehensive Accomplishments Plan (SCAP)
and the cost of the proposed project is within the budget of the
approved SCAP.
Once significant technical and policy issues are resolved,
the Region and State will begin the public comment period on the
draft feasibility study and the Region (or State) will prepare a
draft ROD and supporting documentation- Following completion
of the public comment period, a responsiveness summary should be
prepared to address all comments by the public and views of the
PRPs, whether or not submitted as "comments". The draft ROD may
need to be revised in response to public comment on the feasibility
study.
The draft ROD and responsiveness summary must be reviewed
and concurred on by the State and appropriate Regional Offices.
The State's concurrence with the recommended remedial alternative
should be documented in a letter from the appropriate State
official to the Regional Administrator. The Regional review and
approval process should ensure fnat all concerned offices are
involved. The Office of Regional Counsel (ORC) should be involved
throughout the ROD development process, beginning with the review
of the remedial investigation, to assure that all enforcement
sensitive issues are properly presented and that the ROD is
legally defensible. Before the ROD is presented to the Regional
Administrator for signature, ORC concurrence is necessary. The
Regional program office should review the ROD for technical
adequacy. The Regional Enforcement program must review and
concur on all RODs to help ensure consistency between fund- and
502
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-4-
enforcement-lead projects. Other programs should be consulted
to ensure consistency when the remedial action involves other
environmental acts, regulations, or program activities. For
example, RODs involving the treatment, storage, destruction or
disposal of hazardous wastes should be consistent with RCRA
regulations and technical standards. The final step in the
review and approval process is to brief the Regional Adminis-
trator and obtain his or her approval of the recommended action.
Headouarters will follow a similar review process for RODs not
delegated to the Regions.
For Headquarter decision RODs, the Region should prepare and
review the ROD prior to submission to Headquarters following the
above review process. The official submission should be sent
to the Assistant Administrator, OSWER, and should include a
cover memorandum from the Regional Administrator to the Assistant
Administrator, OSWER. The memo should summarize the proposed
project and present the State and Region's recommendation to
approve the action. A copy of the complete submission should be
sent directly to the Director, Hazardous Site Control Division.
An additional consideration is the coordination of ROD
review with other necessary documents. In the case of Fund-
financed actions* either a Cooperative Agreement or an Interagency
Agreement with the Corps of Engineers should fo'llow a parallel
review nrocess to ensure that EPA approval of the remedy.and EPA
anproval of funding for design occur in the same time period.
For sites where PPPs have been identified and negotiations have
been determined to be appropriate in accordance with Superfund
policy, PRPs may be given the opportunity to conduct the ROD
remedy. In this case, PRP negotiations should be concluded
within 60 days of remedy approval.
MOD/EDO APPROVAL PROCESS
An NDD should be developed by the program office in consul-
tation with the Regional Counsel and should be concurred upon by
the ORC. for enforcement lead, jsiies. .an HDD will .generally b.e
prepared instead of a KOD. In addition, at Fund lead sites, the
Regional Administrator may determine that flexibility .to negotiate
the extent of remedy is needed and an NDD will he prepared instead
of a ROD. This approach is appropriate, for example, when nego-
tiations could result in a remedy that provides greater public
health or environmental protection than the Fund-financed and
Fund-balanced remedy. Figure 2 depicts the remedy selection
process for sites in this category. In these limited situations,
the Region mav choose not. to recommend a particular alternative
in the feasibility study and to prepare an NDD in place of a ROD.
The Region should base its decision to include the recommendation
of an alternative in the feasibility study on the anticipated
scope and nature of PRP negotiations.
503
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-5-
The NDD will contain a discussion of the alternatives
identified in the draft RI/FS and will .indicate...Lhe.._pre-fer.ced
alternative to serve as a basis for neqQtiatio.ns with PRP§. In
selecting the alternative for negotiation with PRPs, the Region
will consider the criteria found in sections 300.68 of the SLCP..
exclusive of the Fund-balancing requirements (300.68(k)). Other
criteria to be considered include litigative risks that have
been defined, consistency with previous enforcement decisions,
public interest considerations, complexity and length of litiga-
tion, likelihood of obtaining the desired remedy through litigation
and availability of the Fund. The NDD should indicate the areas
where flexibility in negotiation with PRPs may be appropriate,
e.g., within an alternative (phased actions) or among alternative
remedies, where appropriate.!- The NDD and support documentation
will be an Enforcement Confidential document and will be used by
the Agency negotiating team in preparing settlement terms with
the PRPs.
Where delegation is not authorized, the official Regional
submission of the NDD, following completion of the public comment
period on the draft RI/FS, should include a cover memorandum
from the Regional Administrator to the Assistant Administrator,
OSWER. A copy of the complete submission should be sent to the
Director, CERCLA Enforcement Division and the Director, Hazardous
Site Control Division. The memo should summarize the recommended
alternative and include a summary of public comment, including
the views of the PRPs, as well as the Region's and, where appro-
priate, the State's recommendation that the alternative selected
be used as a basis for negotiations with PRPs.
tie-go-tiatians should be .concluded w_i.tJun A 60 to 120 day
period for enforcement-lead .sites. When negotiations have
concluded successfully, an EDO will be prepared which will serve
the dual purpose of the ROD with regard to the appropriate extent
of remedy for the site and OSWER concurrence of settlement terms
with PRPs. The EDO will be prepared by the Regional program
division at the same time as the documents of settlement (either
an administrative order on consent or a consent decree). As with
NDDs and PODs, the ORC should participate in the development of
the EDD and concur with the EDD. Where delegation is not authorized,
the EDD will be sent by the Regional Administrator to the Assistant
Administrator of OSWER for final approval.
The EDD generally should contain a discussion of the areas
found in the ROD prepared for a Fund-lead site. The EDD is A
necessary document which, serves th«" fcunction of. tile. ROD. document
for an enforcement-lead site. -It will include a tabulation of
the technical "background documents, the alternatives considered
by the Agency for remedial response by the responsible parties,
and the responsiveness summary of the public comments on the
RI/FS. The EDD will be a public document and should be available
for oublic review and comment .at .the same time that the adminisj-
e order on consent or consent decree.,, containing details
504
-------
-6-
of the settlement between the Agency and the PRPs, is made
available for public comment in accordance with Department of
Justice or EPA policies and regulations. Attachment 2 also
provides information on NDD and EDD format and content.
When negotiations are not successful and Fund-financed
action is warranted, the NDD will serve as the basis for
preparation of a ROD and its supporting documentation, so that
a cost-effective remedy can be selected. The approved remedy
will be implemented through either a Fund-financed response or
through litigation.
SUMMAPY
A number of additional guidance and policy documents are
available, in either draft or final form, to assist in the
development of RI/FS projects. These documents should also be
used to ensure the adequacy of RODs and NDD/EDDs. Xhese include
the proposed NCP revisions (February JL2./ 1985.1 which discuss the
reouirements for CERCLA compliance with other .environmental acts
and a modified definition of cost-effectivenes^. Requirements
for selecting off-site disposal facilities are discussed in a
January 28, 1983, memorandum on that subject, and are currently
being revised to address recent issues such as the amendments to
RCPA. Finally, draft PI and FS guidance documents are available
describing the analysis necessary to conduct RI/FSs, and documents
describing RI/FS procedures for generic types of sites (i.e.,
drums and tanks, surface impoundments, and alternate water
supplies) are being developed.
Questions on ROD preparation should be directed to the
appropriate Pegional Coordinator for Fund-lead sites. Questions
on responsiveness summaries should be directed to the Superfund
Community Relations Coordinator. Additional guidance on the
content and format of RODs, NDDs, and EDDs will be provided as
EPA gains additional experience on their preparation. Within the
next year, the Regions will be requested to submit comments and
recommended changes on the available guidance, based on their
experience in using it. This will allow for a periodic update
of the guidance, to reflect the needs of the program as it develops
Assistance on preparation of NDDs and EDDs will be provided by
Headouarters staff on a site-specific basis. Questions on NDD
or EDD preparation should be directed to the appropriate Regional
Coordinator for Enforcement-lead sites.
Attachments
505
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-7-
cc: Director, Waste Management Division, Regions I and V
Director, Office of Emergency and Remedial Response, Region II
Director, Hazardous Waste Management Division, Region III
Director, Air and Hazardous Waste Management Division
Regions IV, VI, VII, VIII
Director, Toxics and Waste Management Division, Region IX
Director, Air and Waste Division, Region X
Regional Counsels, Regions I-X
Regional Superfund Community Relations Coordinators
Headquarters Zone Managers, HSCD
Headquarters Regional Coordinators, OWPE
Headquarters Superfund Community Relations Coordinators
506
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FIGURE 1
REMEDY SELECTION PROCESS
FUND-LEAD
COMPLETE
RI/FS
PREPARE
DRAFT ROD
1
PUBLIC
COMMENT
PERIOD
PREPARE
FINAL ROD
& RESPONSIVENESS
SUMMARY
APPROVE
ROD
OPTION
ROD REMEDY
NEGOTIATED FOR
IMPLEMENTATION
BY PRP
T
FUND-FINANCED
RESPONSE
{NO SETTLEMENT)
PRP RESPONSE
(SETTLEMENT)
507
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FIGURE 2
REMEDY SELECTION PROCESS
ENFORCEMENT-LEAD
COMPLETE
RI/FS
PREPARE
DRAFT
NOD
PUBLIC & PRP
COMMENT
PERIOD
NEGOTIATION
WITH
PRPs
J
PREPARE
FINAL NDD &
RESPONSIVENESS
SUMMARY
COMPLETE
NEGOTIATIONS
WITH PRPs
1
NO SETTLEMENT
PREPARE
EDD
(SETTLEMENT)
FUND-FINANCED
RESPONSE
(PREPARED ROD)
ENFORCEMENT
ACTION
(LITIGATION)
APPROVE
EDD
PUBLIC COMMENT
PERIOD ON
SETTLEMENT AND
RESPONSIVENESS
SUMMARY
i
FINAL EDD
508
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ATTACHMENT 1
ROD/EDO ISSUES ABSTRACT
Site; [Site Name]
Region; [Region Number]
RA Briefing; [ROD/EDO Briefing Date for RA]
SITE DESCRIPTION
Describe the site in terms of:
location
history of operations, and types and quantities of wastes received
site specific characteristics, as appropriate
contaminated media and types and concentrations of hazardous
substances present
NOTE: This section should not exceed one paragraph.
SELECTED ALTERNATIVE
Describe remedial alternative selected for the site including:
major components of the remedy
operation and maintenance requirements
estimated capital cost and operation and maintenance costs
discuss justification for Fund balancing if appropriate
NOTE: This section should not exceed one paragraph.
ISSUES AND RESOLUTIONS KEY WORDS
The purpose of this section is to document Key words are used to
key issues identified during the ROD/EDO review identify the issues
and approval process. The criteria, rationale discussed under Issues
and standards used to resolve these issues* and Resolutions. (A
should be included in the discussion. Of standard key words list
particular importance are those issues for Issues Abstracts is
pertaining to: attached.)
- elimination of the no action alternative
- compliance with other environmental
laws (e.g., RCRA, TSCA, CWA)
• decisions concerning "how clean is clean*
- fund balancing
(A sample ROD Issues Abstract is attached)
509
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KEY WORDS LIST FOR ISSUES ABSTRACTS
Types of Waste
Herbicide
Liquid Waste
Mining
Pesticide
Petroleum
Media Contaminated
Air
Aquatic Impacts
Drinking Water
Ground Water (Aquifer, Plume)
Soil
Subsurface
Surface Water
Wetlands
Wood
Gener al/Spec if ic
Hazardous'Compounds
Arsenic
Benzene
Benzo (a) Pyrene
Carcinogenic Compounds
Chromium
Heavy Metals
Lead
Organics (Volatile/ Extractable)
PAH
PCB
Sludge
Solvent(s)
Synfuels
Other Agencies
CDC
COE
DOD
DOJ
FEMA
ROD/EDD/NDD
Cost/Benefit
Cost Estimates
Deed Restrictions
Deferred Decisions
Fund Balancing
Ground Water Strategy
Initial Remedial Measure
Internal Remedy
NDD
Negotiated Settlement
No Action Alternative
O&M (Expense, Funding)
Operable Unit
PRP
Publicly-owned Site
RA Approved Action
Recoverable Cost
Relocation (Temporary,
Permanent)
Regulatory Waivers
ROD
ROD Addendum
Shared Costs
Supplemental ROD
Temporary Remedial
Alternative
Miscellaneous
Environmental Impacts
Environmental Standards
Remnant Contamination
Water Supply
Alternate Water Supply
Community Service
Enhancements
Fire Protection
Internal Plumbing
Water Supply System
Well Field
Water Rights
510
As of January 15, IS
-------
KEY WORDS LIST FOR ISSUES ABSTRACTS
(Continued)
Site Specific Characteristics
Drums
Flood Plain (Assessment)
Fractured Bedrock
Ground Water
Hydrogeologic
Lagoon
Seismic (Activity, Zone)
Subsidence
Standards/Regulations/
Permits/Guidance
Air Permits
Air Quality
Alternate Concentration Limit
Ambient Air Quality Criteria
Ambient Water Quality Criteria
Background Levels
CERCLA
Clean Air Act
Clean Water Act 404 permit
Cleanup Criteria
Discharge Standards
Drinking Water Standards
Feasibility Study Guidance Document
Institutional Controls
RCRA 264
RCRA Closure Requirements
RCRA Interim Status
RCRA Landfill Requirements
RCRA Location Criteria
RCRA On site Disposal Requirements
SNARL
Water Quality
Water Rights
Testing/Pilot Studies
EPA Toxicity Test
Fixation Test
Leachability Test
Treatability Test
Technology
Air Stripping
Alternative Technology
Barrier
Best Available Technology
Carbon adsorption
Capping
Containment
Dredging
Excavation
Filling
Fixation
Incineration
Land Treatment
Leachate Collection
Levees
Lined Landfill Cell(s)
Liner
Monitoring (Air, Groundwater
Offsite Disposal
Offsite Plume Control
Onsite Treatment
Permanent Containment
Plume Management
Remedial Technology
Slurry Wall
Source Control
Stabilization
Public Concerns
Analytical Data
Data Adequacy
Direct Contact
Public Exposure
Public Health Risk
Risk Assessment
Risk Level
Trend Analysis
Volatilization
As ot January 15. 196
511
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SAMPLE
ROD ISSUES ABSTRACT
Site: Bio-Ecology Systems Site, Texas
Region; VI
AA, OSWER
Briefing Date; February 6, 1984
SITE DESCRIPTION
The Bio-Ecology site is an 11.2 acre tract located in Grand
Prairie, Texas. The site is bounded in all directions by private prop-
erty and also on the east and south by the tributaries of Old Mountain
Creek. The Bio-Ecology waste disposal site was a Class I industrial
solid waste management facility which was permitted to: 1) incinerate
combustible liquids, slurries and sludges; 2) chemically treat acids,
caustics and other waste chemical solutions, excluding those containing
heavy metals; 3) treat waste waters using biological oxidation; and
4) landfill solids from other treatment processes. The site was ac-
tively operated from June 1972 through 1978.
SELECTED ALTERNATIVE
The cost-effective remedial alternative includes: raising the ele
vation above the 100-year flood plain; construction of an on-site dis-
posal cell with synthetic liner and a leachate collection system; con-
struction of a final cover, liner and leachate collection and removal
system in accordance with RCRA Part 264; stabilize the waste and
encapsulate in an on-site cell; construct a fence; and install a groun
water monitoring system in accordance with RCRA Part 264. The capital
cost for the selected alternative is estimated to be $2,709,600.
Operation and maintenance costs for the first year are estimated to be
$20,000.
ISSUES AND RESOLUTIONS KEY WORDS
1. A source control remedy was considered which . On-Site Containme
provided a degree of protection somewhat . RCRA Landfill
less than that of the fully'protective RCRA
consistent remedy. However, the source con-
trol remedy which includes construction of an
on-site RCRA landfill was selected because it
complies with appropriate RCRA regulations
and provides a high degree of long term reli-
ability with a minimal increase in cost.
512
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SAMPLE
Bio-Ecology Systems Site, Texas
February 6, 1984
Continued
ISSUES AND RESOLUTIONS KEY WORDS
A waiver was not granted from RCRA ground . Ground Water
water protection regulations (Part 264 Contamination
Subpart F). Existing data was not adequate . Ground Water
to determine if contaminated ground water Monitoring
was leaving the site. A monitoring program . RCRA Part 264
was developed to comply with RCRA. If con-
tamination is identified in the future, re-
medial action will be evaluated consistent
with the NCP.
513
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ATTACHMENT 2
ROD CONTENT AND FORMAT
The ROD package is made up of several documents. Formats
for these are included in this attachment. These include:
(1) Format for the ROD, NDD and HDD
(2) Format for the Summary of Remedial Alternative Selection
(3) Format for the Community Relations Responsiveness Summary
(4) Format for briefing the Regional or Assistant Administrator
The primary purpose of the ROD and supporting information is to.
document that the remedial action is consistent with CERCLA and
the NCPj. Generally, this will involve making the determinations
reauired by CERCLA and the NCP in the ROD signed by the Regional
or Assistant Administrator. In addition, the key steps of the
PI/FS must be summarized in the Summary of Remedial Alternative
Selection to show that the NCP decisionmaking process has been
followed. Tf the RI/FS does not contain the required information
(such as evaluation of alternatives that attain ana exceed
applicable and relevant Federal public health and environmental
standards), the ROD packaqe must include this informatio.n. In.
tnis way, any gaps in the RI/FS will be tilled. Regional and
Headauarters staff should review the RI/FS to determine if
additional work is needed to accomplish this and if additional
public comment may be appropriate. The REM/FIT or REM II
contractors can be tasked to assist in this area. The following
list describes typical areas that must be discussed in the ROD
or summary information:
1. Consistency with NCP. The summary information must
show that alternatives were developed, screened, and
evaluated in accordance with sections 300.68(g) through
(i) of the NCP. When the feasibility study is adequate
in this area, the ROD document should briefly summarize
the process and reference the feasibility study for
additional information.
2. No-action alternative. Under Section 300.68(g) of the
NCP, the Agency evaluates a no-action alternative.
The ROD summary must document that no-action was
evaluated and describe, the reasons for elimination of
no-action (e.g. the release poses an actual or potential
threat to public health or the environment).
3. Extent of remedy. The ROD summary must explain how
the level of cleanup for the recommended remedy was
determined. The remedial action may be based on
applicable and/or relevant Federal public health or
environmental standards. When standards are used, the
ROD summary must document how the standards will bo
applied and describe the engineering approach to cost-
effectively implement the standards. When existing
514
-------
-2-
standards, criteria, or regulations are not used, the
approach used to establish a level of cleanup must be
developed in consultation with Headquarters. If the
recommended alternative does not attain or exceed
apoiirable or .relevant standards,, ihe ROD summary must
explain the basis for that decision.
Cost estimates. Costs must be shown for all final
alternatives evaluated in the feasibility study. A
table showing the remedial action cost, annual operation
and maintenance (O&M) cost, and total present worth
should be included. It is important to evaluate the
accuracies of cost estimates. Expected accuracies for
feasibility study estimates should be within +50 and
-30 percent of the actual cost. Remedial investigation
data should be sufficient for this purpose. If existing
data cannot support an adequate cost estimate^ submission
of the ROD should be delayed until additional field
data can be collected and .the cost estimates revised.
Cost-effectiveness evaluation. The factors used to
screen and evaluate alternatives are described in
section 300.68(h) and (i) of the NCP. Draft guidance
on preparation of feasibility studies has also been
sent for Regional review. The ROD summary must describe
what factors were used to screen and evaluate alter-
natives. The feasibility study must include a .narrative
description of the advantages and disadvantages of each
factor for all alternatives. These should be summarized
in the ROD summary. In addition, the advantages (and
disadvantages) of the recommended alternative should
be discussed in the ROD summary. If the feasibility
study developed a numerical ranking of alternatives and
effectiveness factors, this can be included as backup
for the narrative discussion. A'tabular format has
been developed to replace the numerical ranking matrix.
This format should be prepared for each ROD. Several
samples have been included in the Summary of Remedial
Alternative Selection.
CEPCLA section 101(24). If all or part of the recom-
mended remedial action, involves off-site transport,
storage, destruction or disposal of hazardous wastes,
the requirements of sect- ion. 101124J must _b.e .net. The
remedial action or component involving off-site
activities must be more cost-effective than other
remedial actions, create new capacity to manage hazardous
substances in addition to those at the facility, or be
necessary to protect public health, welfare, or the
environment from a present or potential risk. This
determination is included in the ROD and must be discussed
in the ROD summary document. Existing guidance on
specific requirements for off-site facilities receiving
wastes is being revised. This guidance will identify
515
-------
-3-
factors for use in selecting acceptable disposal
facilities. Therefore, Regions should be orepar^d to
describe the adequacy of ootential disposal facilities
during the ROD hriefina for the Regional or Assistant
Administrator.
7. Responsiveness Summary. Any draft ROD circulated for
internal review should summarize citizen and potentially
responsible party concerns known at that time. The
responsiveness summary/ included as a part of the final
ROD package, must include a summary of comments received
before and during the public comment period as well as
activities conducted by EPA or the State to elicit
citizen input. Comments from all parties, including
potentially responsible parties, must be summarized,
including views of PRPs not formally presented as
"comments" (e.g., letters to the Agency, PRP-Funded
contractor studies, etc.). The summary must respond
io comments and discuss in deta.il.: (J) any changes
made due to comments received; (2) how the selected
remedy .differs from the communitv or potentially respon-
sible parties' preferred alternative; and f3). a.ny
alternatives recommended that were not .evaluated in
the feasibility study .and why. they were not included.
The responsiveness -summary should not be .sent to tne
public or potentially responsible parties until the
ROD is approved by the deciding official. (At such
time, the summary response to comments may need to be
revised to reflect the final decision should it differ
from the preferred alternative in the ROD). Any comments
received after the close of the comment period raising
new issues or providing new information should be
considered and addressed by the Regional Program and
Regional Counsel's Office.
8. Operation and Maintenance (O&M). If the recommended
remedial action requires future O&M, the ROD should
describe the O&M activities being approved. The ROD
summary should describe the estimated duration and
cost of O&M activities. J<- should also describe the
funding requested from EPA and the State '£\.mechanj-bia
for funding ?nd carrying out the O&M activities-
9. Negotiation Flexibility. If the Region is recommending
negotiations with PRPs before approval of a remedial
action, the recommended flexibility should be discussed
in the Summarv of Remedial Alterna.Vive Selection. 4,although
an NDD only makes a recommendation and not a selection,
the title of the summary will remain the same since the
format and content is essentially the same). This
should include a recommendation on the .potentially
acceptable ranqe of the extent of remedy if different
than the cost-effective alternative. The technical
516
-------
differences between remedies proposed by PRPs and the
Region's recommendations should be discussed. Finally,
the NDD should define a time schedule for negotiations
with PRPs.
The remainder of this attachment includes additional
information on the required content of ROD packages.
517
-------
Record of Decision
Remedial Alternative Selection
SITE: [Site name, location]
DOCUMENTS REVIEWED
I am basing my decision primarily on the following documents
describing the analysis of cost-effectiveness of remedial
alternatives for the [site name]:
- [Site name] Remedial Investigation
- fSite name] Feasibility Study
Summary of Remedial Alternative Selection
Responsiveness Summary
- [Other relevant reports or documentation of the remedy
selection process]
DESCRIPTION OF SELECTED REMEDY
- [List major components of remedy]
- [List operation and maintenance requirements if funding
will be reauested]
Note? Care must be taken to list all documents used to reach
the final decision. Secondary references included in
the the listed documents need not be listed here.
DECLARATIONS
Consistent with the Comprehensive Environmental Response
Compensation, and Liability Act of 1980 (CERCLA), and the National
Contingency Plan (40 CFR Part 300), I have determined that the
[description of remedy] at the [site name] is a cost-effective
remedy and provides adequate protection of public health, welfare,
and the environment. The State of [State name] has been consulted
and aarees with the approved remedy. [Include the following if
appropriate] In addition, the action will require future operation
and maintenance activities to ensure the continued effectiveness
of the remedy. These activities will be considered part of the
approved action and eligible for Trust Fund monies for a period
of [insert funding period not to exceed 1 year].
I have also determined that the action being taken is
appropriate when balanced against the availability of Trust Fund
monies for use at other sites. [Include the following sentence
if remedy involves off-site actions] In addition, the off-site
518
-------
transport, storage, destruction, treatment, or secure disposition
[use appropriate wording based on actual remedy] is.more cost-
effective than other remedial action, [include the following if
appropriate] and will create new capacity to manage hazardous
waste, [include the following if appropriate] and is necessary
to protect public health, welfare or the environment.
Note: Language for fund balancing waivers or waivers from other
environmental regulations will be worked out on a site-
specific basis.
[Include the following if appropriate.] The State [or EPA]
will undertake an additional remedial investigation/feasibility
study to evaluate [describe scope of RI/FS]. If additional
remedial actions are determined to be necessary a Record of
Decision will be prepared for approval of the future remedial
action.
Date Assistant Administrator
Office of Solid Waste and Emergency Response
or
Regional Administrator
519
-------
Model
Negotiation Decision Document
Remedial Alternative Selection
(Enforcement Confidential)
SITE
- Name
- Location
DOCUMENTS REVIEWED
I am basing my decision primarily on the following documents
describing the analysis of the cost and effectiveness of the
remedial alternatives for the [site name].
- (Site name] Remedial Investigation
- [Site name] Feasibility Study
- Summary of Remedial Alternative Selection
- Summary of public comment
- Summary of Enforcement Analysis for Negotiation with PRPs
- Comments from the PRP group on the draft Feasibility
Study for the [site name]
- Other relevant reports or documentation of the remedy
selection process
Note: Care must be taken to list all documents used to reach
the final decision. Secondary references included in
the listed documents need not be listed«.
DESCRIPTION OF THE RECOMMENDED REMEDY
- Summarize remedial action (e.g., tank removal, soil
removal, grade property, operation and maintenance)
DESCRIPTION OF REMEDY FOR NEGOTIATION WITH PRPs
a. Remedial Alternative
• Oth»r acceptable alternatives or variations to the
selected remedy.
b. Negotiation Strategy and Time Schedule
- The Agency recommends [insert settlement negotiation
schedule to finalize NDD, initiate negotiations, finalize
negotiations, issue a unilateral Administrative Order (AC),
effect an AO, and begin a Fund-financed action] for nego-
tiations of a settlement with PRPs.
520
-------
Date Assistant Administrator
Office of SolidWaste and Emergency Response
or
Regional Administrator
Attachments;
Enforcement Analysis for Negotiation with PRPs
[Site name] PRPs list
521
-------
Model
Enforcement Decision Document
Remedial Alternative Selection
SITE
- Name
- Location
DOCUMENTS REVIEWED
I am basing my decision primarily on the following documents
describing the analysis of the cost and effectiveness
of remedial alternatives for the [site name]:
- [Site name] Remedial Investigation
- [Site name] Feasibility Study
- Responsiveness Summary
- Settlement Document
- Other relevant reports or documentation of the
remedy selection process
Note: Care must be taken to list all documents used to reach
the final decision. Secondary references included in
the listed documents need not be listed.
DESCRIPTION OF SELECTED REMEDY
- List major components of remedy
- List operation and maintenance requirements if
funding will be requested
- List other relevant details of the remedy from the
Settlement Document.
DECLARATIONS
Consistent with the Comprehensive Environmental Response
Compensation, and Liability Act of 1980 (CERCLA), and the
National Contingency Plan (40 CFR Part 300), I have determined
that the [description of remedy] at the [site name] is a cost-
effective remedy that provides adequate protection of public
health, welfare and the environment. The State of [State name]
has been consulted and agrees with the approved remedy. [Include
the following if appropriate] In addition, the action will
require future operation and maintenance activities to ensure
the continued effectiveness of the remedy. These activities
•will be considered part of the approved action. Settlements
have been reached between EPA and the responsible parties baser)
on the eelected remedy.
522
-------
I have also determined that the action beinq taken is
a cost-effective alternative when compared to the other remedial
options reviewed. [If appropriate, include the following sentence
if remedy involves off-site actions] In addition, the off- site
transport, storage, destruction, treatment, or secure disposition
[use appropriate wording based on actual remedy] is more cost-
effective than other remedial action alternatives considered and
will create new capacity to manage hazardous waste, [include the
following if appropriate] and is necessary to protect public
health, welfare or the environment.
Note: Language for enforcement waivers from other environmental
regulations will be worked out on a site specific basis.
[Include the following if appropriate] The State, EPA, or PRP
will undertake an additional remedial investigation/feasibility
study to evaluate [describe scope of RI/FS]. If additional
remedial actions are determined to be necessary, a Negotiation
Decision Document or a Record of Decision will be prepared for
approval of the future remedial action.
Date
Assistant Administrator
Office of Solid Waste and Emergency Pesponse
or
Pegional Administrator
Attachments;
Summary of Remedial Alternative Selection
Community Relations Responsiveness Summary
Settlement Document (Administrative Order or Consent Decree)
523
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SUMMARY OF REMEDIAL ALTERNATIVE SELECTION
[Site Name]
SITE LOCATION AND DESCRIPTION
Describe the site in terms of:
- location, address (include maps, site plan as appropriate)
- area of site, topography, located in floodplain
- adjacent land uses
- location and distance to nearby populations
- general surface and ground water resources
- surface and subsurface features (eg. number and volume of
tanks/ lagoons, structures, drums)
Note: This section should not exceed two paragraphs.
SITE HISTORY
Describe site history in terms of:
- how site was established
- period of operations
- history of ownership
- site uses over period of operation, (type of wastes
received, treatment/storage/disposal pratices)
- type of permits applied for and/or approved, permitting
authority
- history of releases
- previous response actions (eg. 311, immediate removal)
- previous enforcement activities
Note: This section should not exceed two paragraphs.
CURRENT SITE STATUS
Describe results of remedial investigation:
- describe quantity, types, and concentrations of hazardous
substances present (summarize in tables and figures)
- describe known or suspected risks from substances
- extent of contamination (lateral and vertical)
- describe surface and subsurface pathways of migration (eg.
leachability of contaminated soil, soil permeability, depth
to ground water)
- location and number of affected receptors (actual or
potential)
Note: This section should summarize only the information related
to the proposed remedy and maximize the use of maps and
figures.
524
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-2-
ENFORCEMENT [Used when no negotiations with PRPs]
Describe potential current enforcement activities:
- potential responsible parties
- results of negotiations
- filed case
- recommendation to use Fund
ENFORCEMENT ANALYSIS [Use when negotiations with PRPs are proposed]
- discuss PRP interest in undertaking the remedial actions
- discuss the expectation for successful negotiations and
the recommended maximum duration of negotiations
- describe the flexibility (if any) that the Region feels
is appropriate for negotiating
analyze the technical differences between the cost-
effective remedy and remedies proposed by PRPs
ALTERNATIVES EVALUATION
Describe if actions are source control or off-site measures
(40 CFR Part 300.68(e)(2) or (3))
Describe results of feasibility study:
- identify public health and environmental objectives (if
possible describe which objectives are for public health
protection and which are for environmental protection)
- list all alternatives considered (a no-action alternative
must be included)
- identify an on-site alternative that fully complies with
other appropriate environmental laws (eg. RCRA/ TSCA)
- describe the alternative screening process (must be
consistent with 40 CFR Part 300.68(h)). Alternatives
screened generally do not need to be described separately
- briefly explain why alternatives were eliminated, during
screening: if no-action was eliminated provide justification
- describe detailed analysis of final alternatives (must be
consistent with 40 .CFR Part 300.68(i)), discuss factors used
to evaluate effectiveness and results of evaluation
- list alternatives with cost estimates (capital, O&M and
present worth) for comparison with effectiveness evaluation
Note: This section should briefly summarize the above information.
COMMUNITY RELATIONS
- briefly describe the community's level and nature of
concerns or support for each alternative
CONSISTENCY WITH OTHER ENVIRONMENTAL LAWS
- identify technical requirements of other environmental
laws and regulations that could apply to the final site
actions (eg. RCRA, TSCA, CWA, floodplain management)
525
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- describe the alternative that would satisfy the appropriate
technical requirements (if an alternative was not developed
during the feasibility study one must be developed for this
analysis)
- use regulatory compliance alternative as a baseline to
compare other alternatives
- if recommended alternative does not comply/ describe the
differences (e.g., liner/leachate collection is not provided
for on-site containment)
Note: This section should briefly summarize the above information.
If a waiver for compliance with other environmental require-
ments is being requested explain the basis for approval.
Work closely with Headquarters on the use of waivers since
the policy is still under development.
Any regulatory determinations, waivers or findings that
the Regional Administrator is required to make should be '
attached (e.g., alternative concentration limit for ground
water contamination in accordance with 40 CFR Part 264.94(b)
of RCRA regulations).
- describe key requirements that will be complied with (e.g.
RCRA ground water monitoring plan, floodplain assessment
(Executive Order 11988), PCE disposal requirements)
RECOMMENDED ALTERNATIVE
- reference 40 CFR Part 300.68(j) description of cost-
effectiveness
- describe how the recommended alternative meets the cost-
effectiveness requirement
- compare recommended alternative to other alternatives,
and explain why other alternatives are not cost-effective
(e.g., cost, reliability, less than adequate public health
protection)
- Prepare tabular summary of alternatives using attached samples
- discuss justification for Fund balancing, if appropriate
- summarize capital and O&M costs of alternative
- attach appropriate tables or figures describing alternative
OPERATION AND MAINTENANCE (O&M)
— -"' "~ '- - 4
- describe projected O&M activities required to ensure
effectiveness of remedy, include on- and off-site moni-
toring plans
- list estimated annual O&M costs and durations
- describe State's funding mechanism and identify the State
agency responsible for O&M (where the recommended remedy
includes permanent relocation, the relocation responsibilities
must be clearly delineated and the State must commit to its
responsibilities in its concurrence letter).
526
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- include the recommended level of EPA funding and time
period for O&M activities (not to exceed 1 year after
the completion of construction)
SCHEDULE
List key milestones and dates for project implementation:
- Complete Enforcement Negotiations
- Approve Remedial Action (sign ROD)
- Award/Amend Cooperative Agreement for Design
- Award Superfund State Contract (and IAG) for Design
- Start Design
- Complete Design
- Award/Amend Cooperative Agreement for Construction
- Award/Amend Superfund State Contract (and IAG) for
Construction
- Start Construction
- Complete Construction
FUTURE ACTIONS
Describe future remedial activities that are required to complete
site response:
- additional RI/FS projects
- second operable unit (e.g. for ground water mitigation)
- long-term O&M to maintain effectiveness of remedy
527
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COMMUNITY RELATIONS RESPONSIVENESS SUMMARY
[SITE NAME]
INTRODUCTION
The responsiveness summary documents for the public record:
Concerns and issues raised during remedial planning.
Comments raised during the comment period on the feasibility
study.
How EPA or the State considered and responded to these
concerns.
CONCERNS RAISED PRIOR TO THE FEASIBILITY STUDY COMMENT PERIOD
Briefly describe:
Major concerns and issues raised by State and local
officials, potential responsible parties, and citizens.
The level of concern over each of the major issues
should be discussed. Include the number of times a
concern was raised, the number of people raising the
concern and names of individuals or groups 'raising
concerns and issues when appropriate.
Activities conducted by EPA or the State to elicit
citizen input and to address specific concerns and
issues; for example, small group meeting, news conference,
and progress reports.
Changes in any remedial planning activities as a result
of concerns raised.
CONCERNS RAISED DURING THE COMMENT PERIOD
Briefly describe comments on the feasibility study made by
local officials, potential responsible parties and citizens:
Categorize comments by major issue or topic addressed.
Summarize comments under the categories as completely
as possible. Do not be so brief that the essence is
lost. For example, "concern about health effects" is
not specific enough. Which health effect is the
community worried about?
Discuss the level of concern over each of the major
issues. Include how many times the comment was raised
and the number of people raising the concern. Include
names of individuals and groups raising concerns and
issues when appropriate.
528
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- 2 -
Discuss when the comment period started and stopped.
Mention when,where, and level of attendance at public
meeting, if held.
RESPONSE TO COMMUNITY CONCERNS
Explain Agency response.
Note whether staff met with concerned citizens or
conducted other communication activities during the
comment period such as a public meeting or availability
of technical staff to respond to questions.
Document any modifications or changes in the remedial
alternative as a result of comments.
Give the reasons for rejecting the community's or
potential responsible party's preferred alternative if
the Agency's selected alternative is different. The
citation of "CERCLA" alone does not explain the Agency's
rationale. A more detailed explanation is required.
Document in detail any alternatives provided by the
public or potential responsible parties which are not
evaluated In the feasibility study.
Include any letters, reports, etc., received from
potentially responsible parties.
REMAINING CONCERNS
Briefly explain:
Any areas of community concern that require Agency
attention during remedial design and construction.
How EPA or the State intends to resolve any outstanding
concerns.
529
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FORMAT FOR BRIEFING THE REGIONAL [ASSISTANT] ADMINISTRATOR
RECORD OF DECISION
[SITE NAME]
PURPOSE
0 The purpose of this Record of Decision (ROD) is select
the appropriate remedial action at the [site name] that
is consistent with the requirements of CERCLA and the
NCP. The Regional [Assistant] Administrator has been
delegated the authority for that approval.
ISSUES [Discuss general issues that the RA or AA should be aware of]
0 [State and local officials and community interest and concerns]
8 [Federal facility or Federal generator]
0 [RCRA issues for on-site actions]
0 [State cost share, flood plain construction, new
technologies, other issues]
0 [RC or OGC concurrence or concerns]
Note: This section will be presented by Headquarters.
MAIN POINTS
0 [Brief summary of site history]
0 [Brief summary of site description]
0 [Summary of previous and current response actions]
0 [Enforcement status]
0 [Objectives of proposed RA]
0 [Discuss Tabular Summary of Cost-Effectiveness Analysis
including:]
[Alternatives and Costs]
[Public health, environmental, and technical considerations
[Public comments]
[Recommended cost-effective alternative]
0 [Waivers from other environmental programs, if necessary]
Note: This section should summarize only the information
related to the proposed remedy.
530
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0 [Future RA's needed to complete site cleanup]
0 [Summary charts and graphics - effective charts and
graphics include:]
1. Aerial photo showing key features.
2. Site map and/or areal photo showing
proposed actions.
3. Table of final alternatives listing the
alternatives, capital, O&M and present
worth, cost, and public health, environmental,
technical and community considerations
(see samples in Summary of Remedial
alternative Selections).
Note: This section will be presented by the Region.
NFXT STEPS
Action Date
0 RA or AA - OSWER approves ROD
e [amend/award CA, SSC, IAG]
0 [sign PR]
0 [design remedy]
0 [implement remedy]
Note: This section will be presented by the Region.
Note: The Executive Summary should generally be limited to
3-5 pages, excluding charts and graphics.
531
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. D.C. 20460
26'384
MEMORANDUM
SUBJECT: Issuance of Administrative Orders Under Section 3013
of the Resource Conservation and Recovery Act
FROM: Courtney M. Price
Assistant Administrator for Enforcement
and Compliance Monitor
Lee M. Thomas, As sis EarajtAdministrator
Office of Solid Waste and Emergency Response
TO: Addressees
Section 17 of the Solid Waste Disposal Act Amendments of
1980 (P.L. 96-482) added Section 3013 to the Resource
Conservation and Recovery Act of 1976 (RCRA). This memorandum
provides guidance on the use of that section and replaces
earlier guidance issued September 11, 1981.
DELEGATION
Under current delegation authority Section 3013
Administrative Orders (Orders) are issued by Regional Adminis-
trators (RAs) with the advance concurrence of the Director,
Office of Waste Programs Enforcement (OWPE), except in cases
of national significance or in multi-regional cases, when
the Director, OWPE, issues the Orders. The Assistant Adminis-
trator for Enforcement and Compliance Monitoring (OECM), consults
as requested on Orders, refers Section 3013 judicial actions
to the Department of Justice, and sends notices of such action
to the appropriate RA and to the Director, OWPE. Further
rede legation is currently under review.
FINDINGS REQUIRED FOR ISSUANCE
Section 3013 (a). AUTHORITY OF ADMINISTRATOR.
"If the Administrator determines, upon receipt
of any information, that -
532
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- 2 -
(1) the presence of any hazardous waste at
a facility or site at which hazardous waste is,
or has been, stored, treated, or disposed of, or
(2) the release of any such waste
from such facility or site may present a
substantial hazard to human health or the
environment, he may issue an order requiring
the owner or operator of such facility or
site to conduct such monitoring, testing,
analysis, and reporting with respect to
such facility or site as the Administrator
deems reasonable to ascertain the nature
and extent of such hazard."
Under subsection (a), before an Order may be issued, the
RA or, in cases of national significance or multi-regional
cases, the Director, OWPE, must find that sufficient information
has been received to determine that:
(a) the presence of hazardous waste]/at a site may
present a substantial hazard to human health or the environment,
or;
(b) the release of any such waste from the site may
present a substantial hazard to human health or the environment.
The requirement for "information" means that some reliable
information upon which a reasonable person would base a decision
or take action has been gathered or presented before issuance
of the Order. Such information may include laboratory analysis
of samples, observations recorded in the course of an inspection,
and citizens complaints corroborated by supporting information.
Some background information regarding the type and quantity of
waste likely to be found on the site can be located in EPA and
State agency records, as well as by the use of site specific
requests under Section 3007 of RCRA and/or Section 104 of the
I/ Note that the exclusion of gasoline from the definition
of hazardous substances under CERCLA is not applicable
to the hazardous wastes as defined in RCRA. Accordingly, §3013
Orders may be useful enforcement* tools in some situations
involving leaking underground storage tanks (LUSTs). Note,
too, that the statutory definition of hazardous waste (RCRA
81004(5)) is applicable in S3013 Orders, not the Subtitle C
regulatory definition.
533
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- 3 -
Comprehensive Environmental Response, Compensation, and
Liability Act of 1980 (CERCLA). Section 3013 Orders may be
used in situations where information required under Subtitle C
has not been submitted if other factors support the determina-
tion that a substantial hazard may exist. In cases where
information required to be submitted under Subtitle C has not
been submitted, and no indication of substantial hazard is
presented, enforcement action under Section 3008 may be
appropriate. ^J
It should be noted that the mere presence of hazardous-
waste at a site or facility is sufficient to cause the issuance
of an order, provided that the information indicates that the
presence of the waste may present a substantial hazard. This
is true even in the absence of definite evidence of an actual
release of waste, and covers the cases where there is a threat
of release, or where it is difficult, if not impossible, to
ascertain, without extensive sampling, analysis and monitoring,
whether a release has actually occurred or will occur.
Finally, a determination as to whether known and detectable
or potential releases from the site may present a substantial
hazard requires gathering of sufficient information to make a
determination of two essential prerequisites:
2/ Section 106 of CERCLA also may be used to issue an order
to prior owners/operators under circumstances where the
"imminent and substantial endangerment" standard can be met.
In such situations, it may be advantageous to issue a S3013
Order in conjunction with a S106 Order under CERCLA. In
deciding whether to issue a S106 Order under CERCLA or a S3013
Order under RCRA, the main consideration should be whether
available information can support a finding that there may be
an "imminent and substantial endangerment." If such a finding
can be supported, then a 5106 Order or a S106 Order in conjunc-
tion with a S3013 Order is appropriate. The RI/FS policy
regarding circumstances under which a potentially responsible
party may be required to perform an RI/FS should be consulted.
Section 3013 Orders should not -be used to evade the RI/FS
policy. Remedial investigations may be performed pursuant
to a §3013 Order, but feasibility studies are beyond the
jurisdictional scope of S3013.
534
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- 4 -
(1) That there is a known or potential release of hazardous
waste from the site.
(2) That the release "may present a substantial hazard"
to human health or the environment.
Number (1) above may be determined in a variety of ways,
including actual observation of escape from the site of a
substance known to be hazardous, by governmental sampling or
analysis, or through information supplied by the owner/operator.
(See discussion of "information" above.) It is significant
that Congress used the words "may present" rather than "is
presenting", such as had been used in Section 7003 prior to
the 1980 amendments. As in Section 7003, the effect of the
words "may present" is to require that the information
presented to the RA or Director, OWPE, show only that there is
a possibility or potential of a substantial hazard to
human health or the environment, rather than to show that the
hazard actually exists.
Whether a "substantial hazard" may exist involves
consideration of some of the same factors as those used to
determine whether an "endangerment" exists under Section 7003.
The standard itself, however, is a lesser standard than that
under Section 7003. Again, actual harm to human health or the
environment need not be shown, but only that the potential for
harm may exist through a release or threat of release of
hazardous waste from a site. Whether a release or threat
thereof may present a "substantial hazard" essentially depends
upon a number of factors, such as the likelihood of a release
of hazardous wastes, the manner of release of the hazardous
waste from the site (i.e., ground or surface water, air, etc.),
the characteristics and amount of the waste discharged, current
or potential use of the portion of the environment affected,
potential for exposure to humans and the environment, and
other related factors. If the site has been investigated and
prioritized by the Federal government as to hazard presented,
as required by Section 105 of CERCLA, that determination will
be useful in assessing the risk.
TO WHOM THE ORDER MAY BE ISSUED
Section 3013(a) authorizes issuance of an order against
the present owner or operator. Under the circumstances set
forth in subsection (b), issuance of an order may also be
appropriate against a prior owner or operator.
535
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- 5 -
Section 3013 (b). PREVIOUS OWNERS AND OPERATORS.
"In the case of any facility or site not in
operation at the time a determination is made
under subsection (a) with respect to the
facility or site, if the Administrator finds
that the owner of such facility or site could
not reasonably be expected to have actual
knowledge of the presence of hazardous waste
at such facility or site and of its potential
for release, he may issue an order requiring
the most recent previous owner or operator of
such facility or site who could reasonably be
expected to have such actual knowledge to carry
out the actions referred to in subsection (a)."
Subsection (b) entitles the Agency — under certain
circumstances -- to go back in time in the chain of title to a
previous owner or operator of the site. The conditions which
must be met for issuance of a Section 3013 Order to a previous
owner or operator of a site are:
(1) The facility or site must be one which is not
"in operation" at the time a determination is made under sub-
section (a) and (2) the present owner of the facility or site
"could not reasonably be expected to have actual knowledge of
the presence of hazardous waste at such facility or site and
of its potential for release." While in many cases there will
be little question as to whether a facility is "in operation"
(e.g., a closed landfill), in other cases that determination
wTTl not be as clear. We believe that it was the intent of
Congress to place an interpretation on the words "in operation"
which would enable EPA to gather information concerning potent-
ially hazardous sites from those in the best position to provide
that information - the previous owners or operators. We there-
fore believe that a facility is not "in operation" if it has
been abandoned or is not otherwise being actively operated as
a hazardous waste facility by the current owner or operator.
It should be noted that if the present owner of the site
could reasonably be expected to have actual knowledge of both
the presence of the waste and its potential for release (even
though the waste had been placed in or on the site by a previous
owner or operator), this subsection would appear to prohibit
the issuance of an Order to the previous owner or operator.
536
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- 6 -
Assuming the two conditions discussed above are met, the
Order may be issued only to the "most recent previous owner or
operator of such facility or site who could reasonably be
expected to have such actual knowledge. ..." Whether an
owner or a previous owner or operator of a site could "reason-
ably" be expected to have actual knowledge of the presence of
the waste or its potential for release can best be determined
through evidence showing the use of the facility during the
period of ownership by the previous owners. For example, if a
previous owner dumped uncontainerized waste into an unlined
pit and then covered it with dirt, he can reasonably be expected
to have the actual knowledge of both the presence and potential
for release of the waste. The same determination could be
made for an owner who stored waste in leaky containers on the
bare ground without benefit of a pad or base and containment
walls.
ELEMENTS OF AN ORDER
Section 3013 (c). PROPOSAL.
"An order under subsection (a) or (b) shall
require the person to whom such order is
issued to submit to the Administrator within
30 days from the issuance of such order a
proposal for carrying out the required
monitoring, testing, analysis, and reporting.
The Administrator may, after providing such
person with an opportunity to confer with
the Administrator respecting such proposal,
require such person to carry out such moni-
toring, testing, analysis, and reporting in
accordance with such proposal, and such
modifications in such proposal as the
Administrator deems reasonable to ascertain
the nature and extent of the hazard."
Unless EPA and the respondent have agreed in advance on a
work plan to be incorporated in the Order, the Order must
require the respondent to prepare and submit a proposal for
the monitoring, testing, analysis, and reporting Program for
the site from which the waste is'or may be escaping. Such
proposal must be submitted within 30 days from the date of
issuance of the Order. The Order should recite (1) the informa-
tion and facts upon which it is based; (2) the threat or
potential threat to human health and/or the environment; and,
(3) outline with some degree of specificity the general areas
537
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- 7 -
of concern which should be addressed in the proposal to be
submitted by the respondent. Attached to this memorandurn is
an example of an Order (Appendix A) outlining the general
areas of concern to be addressed in the requested sampling,
analysis and monitoring program. 3/
The Order shall direct the respondent to conduct the
monitoring, testing, analysis, and reporting program and
should be specific as to details of the program. For example,
the Order may require the proposal to set forth the number,
location and depth of monitoring wells, the number and
frequency of samples to be taken, the parameters of the
analysis, reporting requirements and other related details,
including dates by which each element should be commenced and
completed and, where appropriate, requirements for submission
of status reports to EPA as work on the program progresses.
The Order, if issued unilaterally, must advise the
respondent of his right to submit in writing any legal or
technical defenses, objections or contentions which he may
desire to make, and that he is entitled to confer in person
and/or by attorney with EPA regarding the proposal. The Order
must also specify the name, address and telephone number of
the appropriate official of EPA whom the respondent may contact
to arrange a conference. The Order should be sent to the
respondent by certified mail, return receipt requested.
In some instances, contacts with the owner /opera tor may
result in issuance of a S3013 Order on a consensual basis. An
example of an Order issued after conferring with the owner/
operator ("Consent Order") is attached (Appendix B). In such
cases, the Order should note that the respondent has already
conferred with EPA and consents to issuance of the Order.
In addition, when a plan already has met with the approval
of the parties, it is advisable to include in the Order a pro-
vision such as:
Respondent agrees to implement the requirements
of the work plan set forth below for carrying out
investigative activities including monitoring,
3_/ The appendices are attached as examples only. They are
not intended to dictate how Orders should be written. The
unique circumstances of each case necessitates some latitude in
the form of such Orders.
538
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- 8 -
testing, analysis and reporting at the facility.
This work plan has been developed jointly by EPA
and Respondent. EPA and Respondent agree that
incorporation of this work plan in the instant
Order satisfies the requirement under Section
3013(c) that Respondent submit a proposal and
that EPA provide an opportunity for Respondent
to confer regarding such proposal.
An Order is "final" in that it requires the preparation
and submission of a plan. However, no actual sampling, analysis
or monitoring should be conducted until after approval of a
satisfactory plan submitted by the respondent (except in cases
delineated in subsection (d)(l) of 13013).
REVIEW OF THE PROPOSAL
The proposal submitted by the respondent is not required
to be in any particular form. It must be critically reviewed
by EPA to ensure that it covers the areas addressed by the
Order, both from a legal and technical standpoint. The proposal
should be as specific as the circumstances and knowledge of
the site will allow, setting forth, for example, the number and
location of monitoring wells, the frequency of samples from
the wells, the location of soil samples, parameters and proto-
cols for analysis, and so forth. In some cases the extent of
the work required will be such that submission of a detailed
plan may be difficult to accomplish in a 30 day period. In
such cases, it may be sensible to require submission of a
broader, less detailed plan within the 30 day period and a
lengthier, detailed plan after the respondent has had an oppor-
tunity to confer with EPA. In cases in which the sampling,
analysis, testing and monitoring program is to be carried out
in stages, or over a significant period of time, the proposal
should include a statement that EPA shall be furnished periodic
status reports from the respondent regarding progress being
made in implementation of the program. The Order should always
state that EPA has a right to approve any proposed changes or
modifications after initial approval has been given to the
proposal.
In reviewing a proposal, EPA personnel should examine two
areas: first, the adequacy of the proposal to achieve the
goals of the sampling, analysis and monitoring programs; and
second, the competence of the persons or firms who will be
implementing the proposal to conduct the sampling, analysis,
monitoring and reporting activities in a technically acceptable
manner, so that the information produced thereby will be
539
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- 9 -
reliable. The second area — the competence of the contractor
or consultant who will implement the program — is delicate
because EPA should not place itself in the position of formally
approving or disapproving the professional qualifications of
particular contractors and it should be made clear to the
respondent that the respondent, not EPA, is responsible for
the competence of the contractor. However, the design and
implementation of the type of program which will be conducted
under a $3013 Order requires engineers and other persons who
are knowledgable in a variety of areas such as hydrology,
geology and chemistry, among others.
While an owner or operator of a site should be at liberty
to hire a contractor of his own choice, EPA should always
require the technical aspects of the proposal to be very
detailed and specific so as to avoid misunderstandings during
the implementation of the program and should also require
frequent status reports while the work is in progress.
In the event a conference results in a modified proposal,
the respondent should either resubmit the entire proposal,
as modified, or if the modifications are not extensive, the
respondent may submit a separate amendment to the proposal.
In all cases, the proposal, and any amendments or modifications,
should be signed by the respondent.
PROPOSAL CONFERENCE
The Order must give the respondent an opportunity to
confer on the proposal submitted for the monitoring plan.
This conference will also afford the respondent the opportunity
to indicate why the respondent should not be subject to the
Order. A record in the form of a tape recording or steno-
grapher's notes should be made and included in the case file.
In the event of subsequent litigation over the Order, the
recording or notes can then be transcribed for use, if necessary.
While the proposal must be submitted to EPA within 30 days
after the date of the Order, we interpret S3013(c) to allow a
conference requested by the respondent to be held either before
or after the proposal is submitted. However, the holding of a
conference cannot vary or extend the 30 day period for submission
of the proposal, so that if a conference is requested for a
time before the proposal is submitted, the conference must be
held and the proposal submitted within the 30 day period.
Conferences to be held after submission of the proposal should
be scheduled as soon as possible after submission (i.e., not
more than 30 days thereafter), so as to avoid delay in finalizing
the proposal.
540
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- 10 -
Under the statute, there Is no requirement for public
notice of the conference or any requirement that third parties
be admitted to the conference. However, nothing precludes the
admittance of a non-party to the conference, if the Region
determines that such participation would be beneficial or
desirable. In certain cases, the Department of Justice, the
State or local pollution control agency and others may be
appropriate attendees or participants.
Pursuant to information developed at the conference, EPA
may modify the proposed sampling, analysis and monitoring
requirements contained in the Order as may be reasonably
required to ascertain the nature and extent of the hazard.
This may include modifications making the requirements nore
strict or extensive, as well as less extensive.
APPROVAL OF PROPOSAL
An acknowledgement letter must be issued under $3013 after
review of the respondent's proposal has been completed. The
purpose of the letter is to acknowledge in writing the decision
EPA has reached after review of the respondent's proposal.
It should be signed, if possible, by the person who signed the
Order. Section 3013(c) permits EPA to modify the proposal
submitted by the respondent or to develop its own program of
sampling, analysis and monitoring in order to determine the
nature and extent of the hazard. The letter should state
whether the proposal has been accepted and should specify what
modifications, if any, have been made to the proposal. This
can be accomplished by attaching a copy of the proposal, as
modified, to the acknowledgement letter. In the unlikely
event that EPA plans to incorporate any major changes in the
Order that were not discussed at the conference, EPA should
notify the respondent of such changes before issuing the
acknowledgement letter and provide reasonable opportunity to
the respondent to comment upon such modifications.
MONITORING PROGRAM BY EPA. STATE. OR OTHER PERSONS
Section 3013(d). MONITORING, ETC., CARRIED OUT BY ADMINISTRATOR
"(1) If the Administrator determines that no
owner or operator referred to in subsection
(a) or (b) is able to conduct monitoring,
testing, analysis, or reporting satisfactory
to the Administrator, if the Administrator
deems any such action carried out by an owner
541
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- 11 -
or operator to be unsatisfactory, or if the
Administrator cannot initially determine that
there is an owner or operator referred to in
subsection (a) or (b) who is able to conduct
such monitoring, testing, analysis, or reporting,
he may—
(A) conduct monitoring, testing, or
analysis (or any combination thereof)
which he deems reasonable to ascertain
the nature and extent of the hazard
associated with the site concerned, or
(B) authorize a State or local authority
or other person to carry out any such
action,
and require, by order, the owner or operator
referred to in subsection (a) or (b) to
reimburse the Administrator or other
authority or person for the costs of such
activity.
(2) No order may be issued under this
subsection requiring reimbursement of
the costs of any action carried out by the
Administrator which confirms the results
6f an order issued under subsection (a)
or (b).
(3) For purposes of carrying out this
subsection, the Administrator or any
authority or other person authorized
under paragraph (1), may exercise the
authorities set forth in Section 3007."
The provisions of this subsection provide for three
situations where the Agency may carry out the monitoring
activities or authorize others to do so:
(1) Where no owner or operator is able to conduct
these activities satisfactorily;
(2) Where the testing conducted by the owner/operator
is determined to be unsatisfactory; or
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(3) Where it cannot be determined initially whether
there is an owner or operator able to conduct the required
monitoring and testing.
Numbers (1) and (3) are similar; the distinction is
that in number (3) no owner/operator can be identified or
located initially, whereas in number (1) the owner/operator is
identified but unable or unwilling to conduct the required
activities.
In numbers (1). (2) and (3) the important consideration
is whether the owner/operator will conduct the required activi-
ties in a manner satisfactory to EPA, i.e.. in a timely manner
and in a manner technically consistent with EPA requirements.
Subsection (d) is intended to allow EPA to conduct the monitoring,
testing, analysis or reporting itself or to authorize the State
or other third parties to perform the required activities if
delay or inadequate performance will result from relying on the
owner/operator.
Once EPA or some other authorized person has performed
monitoring, testing, analysis or reporting pursuant to S3013(d),
an Order may be issued to require reimbursement of the costs.
The Order for Reimbursement should be issued to the present
owner or operator or the most recent previous owner or operator
who could reasonably be expected to have actual knowledge of
the hazardous waste. An example of an Order for Reimbursement
is attached as Appendix C.
Note that subsection (d)(2) prohibits an Order for
Reimbursement if the results obtained confirm the results of
an Order issued under subsection (a) and (b). Our interpre-
tation is that this provision prohibits seeking reimbursement
in circumstance (2) above, where the Agency acted because of
information leading to the belief that the results from the
owner/operator tests were inaccurate or unreliable, and our
subsequent tests, in fact, confirm the owner/operator test
results.
ENFORCEMENT OF THE ORDER
Section 3013 (e). ENFORCEMENT.
"The Administrator may commence a civil
action against any person who fails or
refuses to comply with any order issued
under this section. Such action shall be
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brought in the United States district
court in which the defendant is located,
resides, or is doing business. Such court
shall have jurisdiction to require compliance
with such order and to assess a civil penalty
not to exceed $5,000 for each day during
which such failure or refusal occurs."
This subsection authorizes bringing a civil action to
require compliance with any Order issued under Section 3013 and
to assess a civil penalty of not to exceed $5,000 for each day
of noncompliance with the Order. This authority includes
commencement of a civil action to enforce an Order issued under
Section 3013(d)(l) for reimbursement of costs incurred by EPA
or other authorized person who conducts the monitoring, testing,
or analysis in lieu of an owner/operator.
Any referral of a civil action under Section 3013(e)
should follow the format used for other civil actions.
DEVELOPMENT AND PRESERVATION OF THE ADMINISTRATIVE RECORD
We attempt to emphasize throughout this memorandum the
importance of obtaining the information required by the statute
prior to the issuance of the Order. Equally important is the
establishment and preservation of a record where the information
and all documents relevant to the reimbursement or enforcement
proceedings described herein should be kept, since the Order
may eventually be reviewed by a court, and EPA must have a
complete record of the information which formed the basis for
its decisions and documentation of the opportunity afforded
the respondents to confer. The acknowledgement letter is an
important part of the documentation.
The Region should encourage communications with the
respondent and his representatives to be in writing insofar
as possible. Written records of communication should be made
of all telephone conservations with the respondent and a record
should be made of any conference held with respondents in
accordance with this guidance.
In the event EPA should reject any objections, defenses
or contentions of the respondent, or modify the respondent's
proposal for monitoring, testing, analysis and reporting
without the respondent's agreement, EPA should set forth the
reasons for such rejection or modification and furnish those
reasons in writing to the respondent.
Attachments
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JAN 3 I 1985
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
REGION [#]
IN THE MATTER OF:
[SITE NAME]
[COMPANY NAME
Address]
RESPONDENT.
Proceeding Under Section 106(a)
of the Comprehensive Environ-
mental Response, Compensation,
and Liability Act of 1980
(42 U.S.C. §9606(a) )
U.S. EPA Docket No,
ADMINISTRATIVE ORDER
ON CONSENT
I. JURISDICTION
This Consent Order is issued pursuant to the authority
vested in the President of the United States by Section 106(a)
of the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980 (CERCLA), 42 U.S.C. §9606(a), and
delegated to the Administrator of the United States
Environmental Protection Agency (EPA) on August 14, 1981, by
Executive Order 12316, 46 Fed. Reg. 42237, and further
delegated to the Assistant Administrator for Solid Waste and
Emergency Response and the Regional Administrators by EPA
Delegation Nos. 14-14 and 14-14-A, the latter of which was
signed on April 16, 1984. [Note that further delegation to
the Division Director level is authorized.]
The Respondent agrees to undertake all actions required
by the terms and conditions of this Consent Order. The
Respondent consents to and will not contest EPA jurisdiction
regarding this Consent Order.
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II. STATEMENT OF PURPOSE
In entering into this Consent Order, the mutual objectives
of EPA and [Name of Company] (Company) are: (1) to determine
fully the nature and extent of the threat to the public health
or welfare or the environment caused by the release or
threatened release of hazardous substances, pollutants or
contaminants from [the site] (Remedial Investigation), and
(2) to evaluate alternatives for the appropriate extent of
remedial action to prevent or mitigate the migration or the
release or threatened release of hazardous substances,
pollutants, or contaminants from [the site] (Feasibility
Study). The activities conducted pursuant to this Consent
Order are subject to approval by EPA and shall be consistent
with the National Contingency Plan, 40 CFR Part 300.68 (a)-(j)
(47 Federal Register 31180 (July 16, 1982), revised at 48
Federal Register 40658 (September 8, 1983)).
III. FINDINGS OF FACT
The following constitutes an outline of the facts upon
which this Consent Order is based:
A. [Identify the site with name, address, and description
including geography and brief site history (hereinafter
"Site")]
B. [Identify the respondent; i.e., name/business.]
C. [State a link between the respondent and the site;
e.g., owner, operator, transporter, generator.]
D. [State that the site is on the National Priorities List,
if applicable, and reference Section 105 of CERCLA]
E. [Identify hazardous substances which are associated with
the Respondent and the nature of the association.]
F. [State specific knowledge of the presence of hazardous
substances associated with the site, including sample
results, if available.]
G. [Describe the hazardous properties of the hazardous
substances associated with site.]
H. [Describe the geology and hydrology of the site and
surrounding area; including soil type, depth to ground
water, ground water flow, surface water, etc.]
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I. [Describe the release process, migration pathways, and
possible or known routes of exposure of the hazardous
substances.]
J. [Identify the populations at risk; both human and non-human.]
K. [Describe the consequences of any release or threatened
release of hazardous substances from the site and include
any past incidents involving such a release of hazardous
substances.]
IV. CONCLUSIONS OF LAW
A. [State that the site is a facility as defined in Section
101(9) of CERCLA, 42 U.S.C. §9601(9).]
B. [State that the Respondent is a person as defined in
Section 101(21) of CERCLA, 42 U.S.C. §9601(21).]
C. Wastes and constituents thereof [at the Site, sent to
the Site, disposed of at the Site, and/or transported to
the Site] are "hazardous substances" as defined in
Section 101(14) of CERCLA, 42 U.S.C. §9601(14).
D. The [past, present, and/or potential] migration of
hazardous substances from the Site constitutes an actual
and/or threatened "release" as defined in Section 101(22)
Of CERCLA, 42 U.S.C. of §9601(22).
E. The Respondent is a responsible party pursuant to Section
107(a) of CERCLA, 42 U.S.C. §9607(a).
V. DETERMINATIONS
Based on the Findings of Fact and Conclusions of Law
set out above, EPA has determined that:
A. The actual and/or threatened release of hazardous substances
from the Site may present an imminent and substantial
endangerment to the public health or welfare or the
environment.
B. The actions required by this Consent Order are necessary to
protect the public health and welfare and the environment.
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VI. WORK TO BE PERFORMED
All work performed pursuant to this Consent Order shall
be under the direction and supervision of a qualified
[professional engineer, certified geologist, etc.] with
expertise in [hazardous waste site cleanup]. Prior to the
initiation of site work, the Respondent shall notify EPA in
writing regarding the name, title, and qualifications of
such [engineer, geologist, etc.] and of any contractors
and/or subcontractors to be used in carrying out the terms
of this Consent Order.
Based on the foregoing, it is hereby AGREED TO AND ORDERED
that the following work shall be performed: [Note that if an
EPA approved work plan exists; A, B, and C should be omitted.]
A. Within [unit of time; e.g. 60 calendar days] of the
effective date of this Consent Order, the Respondent shall
submit to EPA a plan for a complete Remedial Investigation
and Feasibility Study (RI/FS Work Plan). This plan shall
be developed in accordance with the EPA Remedial
Investigation and Feasibility Study guidance documents
entitled [Title] which [have been or will be provided
within calendar days] to the Respondent by EPA. . As
described in this guidance, the RI/FS Work Plan must
include: (1) a sampling plan, (2) a health and safety plan
(3) a community relations plan, (4) a plan for satisfaction
of permitting requirements, (5) a description of chain of
custody procedures, and (6) a description of quality control
and quality assurance procedures. [Note that this assumes
the availability of final Remedial Investigation and
Feasibility Study guidance documents which are currently
undergoing revision. An outline of the elements to be
included in the RI/FS work plan, including deliverables,
is attached to this model Consent Order. These elements
are more completely described by the model statement of
work for an RI/FS which is part of the EPA Remedial
Investigation and Feasibility Study guidance documents.]
The RI/FS Work Plan shall be subject to review,
modification, and approval by EPA.
B. After receipt of the RI/FS Work Plan by EPA, EPA shall
notify the Respondent in writing of EPA's approval or
disapproval of the RI/FS Work Plan or any part thereof.
In the event of any disapproval, EPA shall specify in
writing both the deficiencies and any EPA recommended
modifications regarding the RI/FS Work Plan.
548
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C. Within [unit of time; e.g. 30 calendar days] of the
receipt of EPA notification of RI/FS Work Plan disapproval,
the Respondent shall amend and submit to EPA a revised
RI/FS Work Plan. In the event of subsequent disapproval
of the RI/FS Work Plan, EPA retains the right to conduct
a complete RI/FS pursuant to its authority under CERCLA.
D. The Respondent shall implement the tasks detailed in the
Remedial Investigation and Feasibility Study Work Plan
(RI/FS Work Plan) which [has been or will be] approved
by EPA and [is or will be] attached to and incorporated
in this Consent Order (Attachment 1). This work shall
be conducted in accordance with the EPA Remedial
Investigation and Feasibility Study guidance documents
and with the standards, specifications, and schedule
contained in the RI/FS Work Plan.
E. Within [a unit of time; e.g., seven calendar days] of
[the effective date of this Consent Order or approval of
the RI/FS Work Plan by EPA], the Respondent shall commence
[work; e.g., Task 1 of the RI/FS Work Plan.]
F. The Respondent shall provide [unit of time; e.g., monthly]
written progress reports to EPA according to the schedule
contained in the RI/FS Work Plan. At a minimum these
progress reports shall: (1) describe the actions which
have been taken toward achieving compliance with this
Consent Order, (2) include all results of sampling and
tests and all other data received by the Respondent, and
(3) include all plans and procedures completed subsequent
to EPA approval of the RI/FS Work Plan, during the past
[unit of time; e.g., month] as well as such actions,
data, and plans which are scheduled for [the next unit
of time; e.g., month]. These reports are to be submitted
to EPA by [a certain time; e.g., the tenth day of each
month] following the effective date of this Consent Order.
G. The Respondent shall provide preliminary and final reports
to EPA according to the schedule contained in the RI/FS
Work Plan.
H. EPA shall review the preliminary and final reports and
within [unit of time; e.g., 30 calendar days] of receipt
by EPA of such reports, EPA shall notify the Respondent
in writing of EPA's approval or disapproval of these
reports or any part thereof. In the event of any
disapproval, EPA shall specify in writing both the
deficiencies and the reasons for such disapproval.
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Within [unit of time; e.g., 30 calendar days] of receipt
of EPA notification of preliminary or final report
disapproval, the Respondent shall amend and submit to
EPA such revised reports. In the event of disapproval,
EPA retains the right to amend such reports, to perform
additional studies, and to conduct a complete Remedial
Investigation and Feasibility Study pursuant to its
authority under CERCLA.
Documents, including reports, approvals, disapprovals,
and other correspondence, to be submitted pursuant to
this Consent Order, shall be sent by [certified mail] to
the following addresses or to such other addresses as
the Respondent or EPA hereafter may designate in writing:
1) Documents to be submitted to EPA should be sent to
[indicate number of copies]:
[EPA Project Coordinator,
CERCLA Enforcement Branch]
US EPA, Region [#] ,
[Street, City, State, Zip Code].
2) Documents to be submitted to the Respondent should be
sent to [include number of copies]:
[Name, title,
Organization,
Street, City, State, Zip Code]
EPA may determine that tasks, including remedial
investigatory work and/or engineering evaluation, are
necessary as part of a Remedial Investigation and
Feasibility Study in addition to EPA-approved tasks and
deliverables, including reports, which have been completed
pursuant to this Consent Order. Subject to the "Dispute
Resolution" Section (Section XII) of this Consent Order,
the Respondent shall implement any additional tasks
which EPA determines are necessary as part of a Remedial
Investigation and Feasibility Study and which are in
addition to the tasks detailed in the RI/FS Work plan.
The additional work shall be completed in accordance
with the standards, specifications, and schedule determined
or approved by EPA. [If the Respondent does not agree
to this provision, Sections XIV, XV, and XXIII of this
Consent Order must specifically reserve EPA's right to
perform additional tasks and to seek reimbursement for
such tasks from the Respondent.]
550
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VII. DESIGNATED PROJECT COORDINATORS
On or before the effective date of this Consent Order,
EPA and the Respondent shall each designate a Project
Coordinator. Each Project Coordinator shall be responsible
for overseeing the implementation of this Consent Order.
The EPA Project Coordinator will be EPA's designated
representative at the Site. To the maximum extent possible,
communications between the Respondent and EPA and all documents,
including reports, approvals, and other correspondence
concerning the activities performed pursuant to the terms
and conditions of this Consent Order, shall be directed
through the Project Coordinators.
EPA and the Respondent each have the right to change their
respective Project Coordinator. Such a change shall be
accomplished by notifying the other party in writing at least
[unit of time; e.g., five calendar days] prior to the change.
The EPA designated "On-Scene-Coordinator", who may be
the EPA Project Coordinator, shall have the authority vested
in the On-Scene-Coordinator by the National Contingency
Plan; 40 C.F.R. Part 300 et seq., 47 Federal Register 31180
July 16, 1982. This includes the authority to halt, conduct,
or direct any tasks required by this Consent Order and/or
any response actions or portions thereof when conditions
present an immediate risk to public health or welfare or the
environment.
The absence of the EPA Project Coordinator from the Site
shall not be cause for the stoppage of work.
VIII. QUALITY ASSURANCE
The Respondent shall use quality assurance, quality
control, and chain of custody procedures in accordance with
[reference document; e.g., EPA Region [#] Environmental
Services Division Standard Operating Procedures Manual]
throughout all sample collection and analysis activities.
This manual shall be provided to the Respondent by EPA. The
Respondent shall consult with EPA in planning for, and prior
to, all sampling and analysis as detailed in the RI/FS Work
Plan. In order to provide quality assurance and maintain
quality control regarding all samples collected pursuant to
this Consent Order, the Respondent shall:
A. Ensure that EPA personnel and/or EPA authorized
representatives are allowed access to the laboratory(s)
and personnel utilized by the Respondent for analyses.
551
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B. Ensure that the laboratory(s) utilized by the Respondent
for analyses perform such analyses according to EPA
methods or methods deemed satisfactory to EPA and submit
all protocols to be used for analyses to EPA at least
[unit of time; e.g., 14 calendar days] prior to [the
commencement of analysis].
C. Ensure that laboratory(s) utilized by the Respondent for
analyses participate in an EPA quality assurance/quality
control program equivalent to that which is followed by EPA
and which is consistent with [reference document; e.g.,
EPA document QAMS-005/80] . As part of such a program, and
upon request by EPA, such laboratory(s) shall perform
analyses of samples provided by EPA to demonstrate the
quality of each laboratory's analytical data. A maximum
annual number of [Number, recommended: four per analytical
combination; e.g., four aqueous samples by Gas
Chromatography/Mass Spectrometry, four soil/sediment
samples by Gas Chromatography/Mass Spectrometry, etc.]
samples may be provided to each laboratory for analysis.
IX. SITE ACCESS
To the extent that the Site is presently owned by parties
other than those bound by this Consent Order, the Respondent
has obtained or will use their best efforts to obtain site
access agreements from the present owners within [unit or
time; e.g. 30 calendar days] of the effective date of this
Consent Order. Such agreements shall provide reasonable
access to EPA and/or its authorized representatives. In the
event that site access agreements are not obtained within
the time referenced above, the Respondent shall notify EPA
regarding both the lack of, and efforts to obtain, such
agreements within [same unit of time as above] of the
effective date of this Consent Order.
X. SAMPLING, ACCESS, AND DATA/DOCUMENT AVAILABILITY
The Respondent shall make the results of all sampling
and/or tests or other data generated by the Respondent,
or on the Respondent's behalf, with respect to the
implementation of this Consent Order, available to EPA and
shall submit these results in [regular; e.g., monthly] progress
reports as described in Section VI of this Consent Order.
EPA will make available to the Respondent the results of
sampling and/or tests or other data similarly generated by
EPA.
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At the request of EPA, the Respondent shall allow split
or duplicate samples to be taken by EPA and/or its authorized
representatives, of any samples collected by the Respondent
pursuant to the implementation of this Consent Order. The
Respondent shall notify EPA not less than [unit of time; e.g./
48 hours] in advance of any sample collection activity.
EPA and/or any EPA authorized representative shall at
least have the authority to enter and freely move about all
property at the Site at all reasonable times for the purposes
of, inter alia; inspecting records, operating logs, and
contracts related to the Site; reviewing the progress of the
Respondent in carrying out the terms of this Consent Order;
conducting such tests as EPA or the Project Coordinator deem
necessary; using a camera, sound recording, or other documentary
type equipment; and verifying the data submitted to EPA by
the Respondent. The Respondent shall permit such persons to
inspect and copy all records, files, photographs, documents,
and other writings, including all sampling and monitoring
data, in any way pertaining to work undertaken pursuant to
this Consent Order. All parties with access to the Site
pursuant to this paragraph shall comply with all approved
health and safety plans.
The Respondent may assert a confidentiality claim, if
appropriate, covering part or all of the information requested
by this Consent Order pursuant to 40 C.F.R. §2.203(b). Such
an assertion shall be adequately substantiated when the
assertion is made. Analytical data shall not be claimed as
confidential by the Respondent. Information determined to
be confidential by EPA will be afforded the protection specified
in 40 C.F.R. Part 2, Subpart B. If no such claim accompanies
the information when it is submitted to EPA, it may be made
available to the public by EPA without further notice to the
Respondent.
XI. RECORD PRESERVATION
EPA and the Respondent agree that each shall preserve,
during the pendency of this Consent Order and for a minimum
of six (6) years after its termination, all records and
documents in their possession or in the possession of their
divisions, employees, agents, accountants, contractors, or
attorneys which relate in any way to the Site, despite any
553
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document retention policy to the contrary. After this six
year period, the Respondent shall notify EPA within [unit of
time; e.g. 30 calendar days] prior to the destruction of any
such documents. Upon request by EPA, the Respondent shall
make available to EPA such records or copies of any such
records. Additionally, if EPA requests,,that some or all
documents be preserved for a longer period of time, the
Respondent shall comply with that request.
XII. DISPUTE RESOLUTION
If the Respondent objects to any EPA notice of disapproval
or decision made pursuant to this Consent Order, the Respondent
shall notify EPA in writing of its objections within fourteen
(14) days of receipt of the decision. EPA and the Respondent
then have an additional fourteen (14) days from the receipt by
EPA of the notification of objection to reach agreement. If
agreement cannot be reached on any issue within this fourteen
(14) day period, EPA shall provide a written statement of
its decision to the Respondent.
XIII. DELAY IN PERFORMANCE/STIPULATED PENALTIES
[See the Appendix for additional "Force Majeure" language"]
For each week that the Respondent fails to submit a
report or document or otherwise fails to achieve the
requirements of this Consent Order, the Respondent shall pay
into the United States Treasury, the sums set forth below
as stipulated penalties. Checks should be addressed to
[address].
Stipulated penalties shall accrue in the amount of [List
failure category, time of delay, and penalty; e.g., $1,000.00
for the first week and $2,000.00 for each week thereafter for
failure to submit a deliverable or comply with a schedule
as required by this Consent Order.]
The stipulated penalties set forth in this Section do
not preclude EPA from electing to pursue any other remedies
or sanctions which may be available to EPA by reason of the
Respondent's failure to comply with any of the requirements
of this Consent Order. Such remedies and sanctions include
a suit for statutory penalties as authorized by Section 106
of CERCLA, a federally-funded response action, and a suit for
reimbursement of costs incurred by the United States and the
State of [State]. [Note: It is OSWER policy that statutory
penalties cannot be waived.]
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XIV. RESERVATION OF RIGHTS
Notwithstanding compliance with the terras of this Consent
Order, including the completion of an EPA approved Remedial
Investigation and Feasibility Study, the Respondent is not
released from liability, if any, for any actions beyond the
terms of this Consent Order taken by EPA respecting the
Site. EPA reserves the right to take any enforcement action
pursuant to CERCLA and/or any available legal authority,
including the right to seek injunctive relief, monetary
penalties, and punitive damages for any violation of law or
this Consent Order.
[Except as expressly provided in the "Covenant Not to Sue"
Section (Section XXIII) of this Consent Order,) the Respondent,
and EPA expressly reserve all rights and defenses that they
may have, including EPA's right both to disapprove.of work
performed by the Respondent and to request that the Respondent
perform tasks in addition to those detailed in the RI/FS
Work Plan, as provided in this Consent Order. In the event
that the Respondent declines to perform any additional and/or
modified tasks, EPA will have the right to undertake any
remedial investigation and/or feasibility study work. In
addition, EPA reserves the right to undertake removal actions
and/or remedial actions at any time. In either event, EPA
reserves the right to seek reimbursement from the Respondent
thereafter for such costs incurred by the United States or
the State of [State].
XV. REIMBURSEMENT OF COSTS
At the end of each year, EPA shall submit to the
Respondents an accounting of all response and oversight
costs incurred by the U.S. Government with respect to this
Consent Order. The Respondent shall, within 30 calendar
days of receipt of that accounting, remit a check for the
amount of those costs made payable to the Hazardous Substance
Response Trust Fund. Checks should specifically reference
the identity of the site and be addressed to:
U.S. Environmental Protection Agency
Superfund Accounting
P.O. Box 371003M
Pittsburgh, PA 15251
Attention: [Collection Officer for Superfund]
[A copy of the transmittal letter should be sent to the
Project Coordinator.]
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EPA reserves the right to bring an action against the
Respondent pursuant to Section 107 of CERCLA for recovery of
all response and oversight costs incurred by the United States
and the State of [State] related to this Consent Order and
not reimbursed by the Respondents, as well as any other past
and future costs incurred by the United States and the State
of [State] in connection with response activities conducted
pursuant to CERCLA at this site.
XVI. OTHER CLAIMS
Nothing in this Consent Order shall constitute or be
construed as a release from any claim, cause of action or
demand in law or equity against any person, firm, partnership,
or corporation not a signatory to this Consent Order for
any liability it may have arising out of or relating in
any way to the generation, storage, treatment, handling,
transportation, release, or disposal of any hazardous
substances, hazardous wastes, pollutants, or contaminants
found at, taken to, or taken from the Site.
This Consent Order does not constitute any decision on
preauthorization of funds under Section lll(a)(2) of CERCLA.
XVII. OTHER APPLICABLE LAWS
All actions required to be taken pursuant to this Consent
Order shall be undertaken in accordance with the requirements
of all applicable local, state, and federal laws and regulations
unless an exemption from such requirements is specifically
provided in this Consent Order.
XVIII. INDEMNIFICATION OF THE UNITED STATES GOVERNMENT
The Respondent agrees to indemnify and save and hold the
United States Government, its agencies, departments, agents,
and employees, harmless from any and all claims or causes of
action arising from or on account of acts or omissions of
the Respondent, its officers, employees, receivers, trustees,
agents, or assigns, in carrying out the activities pursuant
to this Consent Order. EPA is not a party in any contract
involving the Respondent at the Site.
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XIX. PUBLIC COMMENT
Upon submittal to EPA of an approved Feasibility Study
Final Report, EPA shall make both the Remedial Investigation
Final Report and the Feasibility Study Final Report available
to the public for review and comment for, at a minimum, a
twenty-one (21) day period, pursuant to EPA's Community
Relations Policy. Following the public review and comment
period, EPA shall notify the Respondent which remedial action
alternative is approved for the site.
XX. EFFECTIVE DATE AND SUBSEQUENT MODIFICATION
In consideration of the communications between the
Respondent amd EPA prior to the issuance of ;;his Consent
Order concerning its terms, the Respondent agrees that there
is no need for a settlement conference prior to the effective
date of this Consent Order. Therefore, the effective date
of this Consent Order shall be the date on which it is signed
by EPA.
This Consent Order may be amended by mutual agreement of
EPA and the Respondent. Such amendments shall be in writing
and shall have as the effective date, that date on which
such amendments are signed by EPA.
Any reports, plans, specifications, schedules, and
attachments required by this Consent Order are, upon
approval by EPA, incorporated into this Consent Order. Any
non-compliance with such EPA approved reports, plans,
specifications, schedules, and attachments shall be considered
a failure to achieve the requirements of this Consent Order
and will subject the Respondent to the provisions included
in the "Delay in Performance/ Stipulated Penalties" Section
(Section XIII) of this Consent Order.
No informal advice, guidance, suggestions, or comments
by EPA regarding reports, plans, specifications, schedules,
and any other writing submitted by the Respondent will be
construed as relieving the Respondent of its obligation to
obtain such formal approval as may be required by this Consent
Order.
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XXI. PARTIES BOUND
This Consent Order shall apply to and be binding upon
the Respondent and EPA, their agents, successors, and assigns
and upon all persons, contractors, and consultants acting
under or for either the Respondent or EPA or both.
No change in ownership or corporate or partnership
status relating to the Site will in any way alter the status
of the Respondent or in any way alter the Respondent's
responsibility under this Consent Order. The Respondent
will remain the Respondent under this Consent Order and will
be responsible for carrying out all activities required of
the Respondent under this Consent Order.
The Respondent shall provide a copy of this Consent Order
to all contractors, sub-contractors, laboratories, and
consultants retained to conduct any portion of the work
performed pursuant to this Consent Order within [unit of
time; e.g., 14 calendar days] of the [effective date of this
Consent Order or date of such retention].
XXII. NOTICE TO THE STATE
EPA has notified the State of [State]*pursuant to the
requirements of Section 106(a) of CERCLA.
XXIII. COVENANT NOT TO SUE
[This Section depends on the provisions of Sections VI,
XIV, and XV. If those Sections are limited, this provision
must be more restricted. See the Appendix for suggested
language.]
XXIV. TERMINATION AND SATISFACTION
The provisions of this Consent Order shall be deemed
satisfied upon the Respondent's receipt of written notice
from EPA that the Respondent has demonstrated, to the
satisfaction of EPA, that all of the terms of this Consent
Order, including any additional tasks which EPA has
determined to be necessary, have been completed.
558
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- 15 -
IT IS SO AGREED AND ORDERED:
BY:
[The Respondent] Title Date
BY:
U.S. Environmetal Protection Agency Date
Effective Date:
559
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Appendix *
Additional Language for FINDINGS OF FACT Section;
The Respondent does not admit to any of the factual or
legal determinations made by EPA and reserves the rights and
defenses which the Respondent may have regarding liability
or responsibility in any subsecruent proceedings regarding
the Site, other than proceedings to enforce this Consent Order.
Additional Language for DELAY IN PERFORMANCE Section;
If any event occurs which causes delay in the achievement
of the requirements of this Consent Order, the Respondent shall
have the burden of proving that the delay was caused by
circumstances beyond the reasonable control of the Respondent
which could not have been overcome by due diligence. The
Respondent shall promptly notify EPA's Project Coordinator
orally and shall, within [unit of time; e.g., seven (7)
calendar days] of oral notification to EPA, notify EPA in
writing of the anticipated length and cause of the delay,
the measures taken and/or to be taken to prevent or minimize
the delay, and the timetable by which the Respondent intends
to implement these measures. If the parties can agree that
the delay or anticipated delay has been or will be caused by
circumstances beyond the reasonable control of the Respondent,
the time for performance hereunder shall be extended for a
period equal to the delay resulting from such circumstances.
The Respondent shall adopt all reasonable measures to avoid
or minimize delay. Failure of the Respondent to comply with
the notice requirements of this paragraph shall render this
paragraph void and constitute a waiver of the Respondent's
right to request a waiver of the requirements of this Consent
Order. Increased costs of performance of the terms of this
Consent Order or changed economic circumstances shall not be
considered circumstances beyond the control of the Respondent.
In the event that EPA and the Respondent cannot agree that
any delay in the achievement of the requirements of this Consent
Order, including the failure to submit any report or document,
has been or will be caused by circumstances beyond the reasonable
control of the Respondent, the dispute shall be resolved in
accordance with the provisions of the "Dispute Resolution"
Section (Section XII) of this Consent Order.
Language for COVENANT NOT TO SUE Section;
Upon termination of this Consent Order pursuant to
Section XXII of this Consent Order, and reimbursement to EPA
as provided in Section XV, EPA covenants not to sue the
Respondent for costs incurred by EPA associated with the
conduct and completion of the Remedial Investigation and
Feasibility Study except as otherwise reserved herein.
* Note;these provisions are commonly requested by potentially
responsible parties and should not be included in the EPA
first draft.
560
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Outline of Attachment 1 *
I. REMEDIAL INVESTIGATION
Purpose: Determine the nature and extent of the problem and
gather data necessary to support the feasibility study
A.
B,
C.
D,
E.
F,
G,
Description of Site and Current Situation
Plans and Management
Site Investigation
1) Waste Characterization
Hydrogeologic Investigation
Soil and Sediment Investigation
Surface Water Investigation
Air Investigation
Investigation Analysis
and Pilot Scale Studies
2)
3)
4)
5)
Site
Laboratory
Reports
Additional Requirements
1) Reporting Requirements
2) Community Relations Support
3) Schedule For Activities
a) Remedial Investigation Activity
b) Meetings
c) Briefings
4) Schedule For Deliverables [Include number of copies]
a) Remedial Investigation Plan
b) Sampling Plan
c) Health and Safety Plan
d) Community Relations Plan
e) Permitting Requirements and Procedures
f) Chain of Custody Procedures
g) Quality Assurance/Quality Control Procedures
h) Regular [unit of time; e.g., monthly] Progress
Reports
i) Draft Report
j) Final Report
II. FEASIBILITY STUDY
Purpose: Develop and evaluate remedial alternatives
A. Description of Current Situation and Proposed Response
* Note that this is an outline of a model statement of work
for an RI/FS which is part of the EPA Remedial
Investigation and Feasibility Study guidance documents.
561
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- 2 -
B. List and Screen Potential Remedial Technologies
C. Develop Limited Number of Remedial Alternatives
1) Establish Remedial Response Objective
2) Identify Alternatives
D. Screen Alternatives based on environmental protection,
environmental effects and cost
E. Evaluate Remaining Alternatives
1) Detailed Development
2) Environmental, Public Health, Institutional, and
Cost Analysis
F. Preliminary Report
G. Final Report
H. Additional Requirements
1) Schedule for Activities
a) Feasibility Study Activity
b) Meetings
c) Briefings
2) Schedule for Deliverables
a) Feasibility Study Plan
b) List and Screen Potential Remedial Technologies
and Identify Remedial Alternatives
c) Screen and Evaluate Alternatives
d) Preliminary Report
e) Final Report
562
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. D.C. 204SO
E3 21 .-:
MEMORANDUM
SUBJECT: Preparation of Decision Documents for Approving
i^und-Financed and Potentially Responsible Party
lial Actions Under CERCLA
FROM: crack" W; Mc
jting Assistant Administrator
TO: Regional Administrator
Regions I-X
PURPOSE
This memorandum and the attached information have been
prepared to assist Regional Offices in the preparation of the
decision documents required for the approval of Fund-financed
and potentially responsible party (PRP) remedial actions. A
Record of Decision (ROD) will be required for all remedial actions
financed with monies from the Trust Fund (with the exception of
some initial remedial measures (IRMs) as described below). The
ROD will document the Agency's decisionmaking process and demon-
strate that the requirements of CERCLA and the NCP have been met.
This procedure will provide the basis for future cost recovery
actions that may be undertaken.
.A ROD will be used for sites where PRPs exist and negotia-
tions may occur to determine if the PRPs will implement the
approved remedy. For. enforcement lead sites/ a Negotiation
Decision Document (NDD) will generally be prepared instead" of
a ROD. In addition, wnen the Regional Administrator determines
that greater flexibility is required to negotiate with PRPs at
Fund-lead sites, an alternative to the ROD process should be
followed. In those cases, an NDD will be prepared to approve
the range of negotiation flexibility. Following completion of
negotiations, an Enforcement Decision Document (EDD) will be
prepared to approve remedial actions to be implemented by PRPs.
REGIONAL DELEGATION
This guidance has been developed in anticipation of additional
delegation of remedy approval authority to Regional Administrators.
The guidance applies to IRMs that were delegated in FY 84 and to
those remedial actions expected to be delegated in FY 85.
563
-------
Regional Counsels, Regions I-X
Regional Administrators, Regions I-X
Hazardous Waste Coordinators, Regions I-X
RCRA Branch Chiefs, Regions I-X1
564
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FINAL REVISED GUIDANCE MEMORANDUM ON THE
USE AND ISSUANCE OF ADMINISTRATIVE ORDERS
UNDER SECTION 7003 OF THE RESOURCE CONSERVATION
AND RECOVERY ACT (RCRA)
September 26, 1984
565
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TABLE OF CONTENTS
I. INTRODUCTION 1
II. SCOPE OF RCRA S7003 2
A. Evidence 2
B. What Constitutes Handling, Storage,
Treatment or Disposal 3
C. Necessity of Existence of Imminent and
Substantial Endangerment 3
D. Persons to Whom an Order May be Issued 5
E. Notice to Affected States 6
III. SELECTING ENFORCEMENT OPTION 6
A. Administrative Order or Civil Referral 7
B. Use of RCRA or CERCLA 7
C. Deciding to Use a S7003 Order 9
1. Respondent's Financial Status.... 9
2. Number of Respondents Subject to the Order.. 10
i) Coordination of Response Action 10
ii) Supervision 11
3. Specificity of the Necessary Response
Action 11
IV. ELEMENTS OF AN ORDER 12
V. CONFERENCE PROCEDURES 14
VI. MODIFICATION, REVOCATION, OR STAY OF THE ORDER 15
VII. NEGOTIATION OF ADMINISTRATIVE ORDERS 15
VIII. DELEGATIONS OF AUTHORITY 16
APPENDIX. STATE NOTIFICATION LETTER 17
566
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I. INTRODUCTION
RCRA16 administrative enforcement authority is an
important component of the Agency's overall hazardous waste
enforcement program. The effectiveness of EPA's enforcement
program will be demonstrated as respondents implement site
remedies in compliance with administrative orders, the Agency
pursues enforcement actions vigorously against respondents
who fail to comply with such orders, and the Agency defends
aggressively judicial challenges to orders.
Section 7003 of the Resource Conservation and Recovery
Act (RCRA) provides EPA with a broad and powerful enforcement
tool that may be used to abate imminent hazards that are caused
by the handling, storage, treatment, transportation or disposal
of solid waste or hazardous waste. Under §7003, the Adminis-
trator may seek injunctive relief in the appropriate United
States District Court or, after notice to the affected State,
take appropriate action "including, but not limited to, issuing
such orders as may be necessary to protect public health or the
environment."
The S7003 administrative order authority provides strong
incentives for respondents to expeditiously undertake response
actions deemed necessary by EPA to ensure protection to public
health or the environment. Therefore, the Regions are urged to
consider the use of unilateral RCRA §7003 orders in appropriate
cases wherever it is necessary to compel response action. It
is essential that the RCRA enforcement program combines both
administrative and judicial enforcement authorities to ensure
protection of health and the environment from the improper
handling of hazardous waste.
The following guidance has been prepared to assist the
Regional offices in developing and issuing administrative
orders pursuant to S7003. It supersedes the earlier Agency
guidance issued on September 11, 1981, by Douglas MacMillan,
Acting Director, Office of Waste Programs Enforcement, entitled
"Issuance of Administrative Orders Under S7003 of the Resource
Conservation and Recovery Act."
Since S7003 is similar in scope to 5106 of the
Comprehensive Environmental Response, Compensation, and
Liability Act, the reader should consult the guidance
issued on September 8, 1983, entitled "Guidance 'morandum on
Use or Issuance of Administrative Orders Under fc 06(a) of
567
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- 2 -
CERCLA." A fuller treatment of the following areas, common to
both 7003 and 106, is found in the (1983) 106 Guidance:
Necessity for Determination Based on Evidence; Necessity for
Actual or Threatened Release; Necessity that Release or Threat
of Release be from a facility (applicable in the case of joint
7003 & 106 orders); and Necessity for Existence of Imminent
and Substantial Endangerment. Where joint orders under §§7003
and 106 are issued, the Regions should adhere to the require-
ments set out in both guidance memoranda. The reader should
also consult the CERCLA §106 guidance, "Issuance of Administra-
tive Orders for Immediate Removal Actions" (Lee Thomas, OSWER,
February 21. 1984).
It should be noted that the reauthorization of RCRA by
Congress may affect some aspects of §7003, regarding the
participation of the public in the settlement of administrative
orders and liability for past activities. If RCRA is amenaed,
supplemental guidance will be provided as appropriate.
II. SCOPE OF RCRA §7003 */
In order to issue a §7003 order, the Administrator must
possess evidence "that the handling, storage, treatment, trans-
portation or disposal of any solid waste or hazardous waste
may present an imminent and substantial endangerment to health
or the environment" (42 U.S.C. §6973). Additionally, §7003
requires that the Administrator provide notice to the affected
State prior to issuance of the order. Each of these require-
ments is discussed in further detail below.
A. Evidence
Because the recipient of a §7003 order may seek
administrative or judicial review of the order, the Region
must have all the evidence necessary to demonstrate that the
^J Note: the terms "hazardous waste" and "solid waste"
in RCRA §7003 refer to the statutory definitions,
§§1004(5) and 1004(27), of RCRA and not to the regulatory
provisions promulgated pursuant to §3001 and codified at 40 CFR
Part 261. These regulatory provisions are meant for application
only in the Subtitle C regulatory program. As long as a waste
meets the §1004 definition of solid or hazardous waste, it need
not be listed in Part 261 or satisfy one of the characteristics
specified in Part 261.
568
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- 3 -
statutory criteria have been satisfied at the time the order
is issued. The evidence must establish that the respondent
has handled, treated, stored, transported or disposed of a
solid or hazardous waste, and that such activity has resulted
in a condition that may present an imminent and substantial
endangerment to health or the environment. Necessary evidence
may be documentary, testimonial, or physical and may be
obtained from a variety of sources including inspections,
investigations, or requests for production of documents or
other data pursuant to RCRA 5§3007, 3013 or CERCLA §104. The
evidence must be sufficiently probative and reliable to
enable a reasonable person to conclude that issuance of an
order is appropriate. For example, an unsubstantiated citizen's
complaint would normally not be sufficient to justify issuance
of an order. If that complaint were supported by corroborating
evidence, however, such as laboratory analyses, the complaint
and corroboration could normally be considered a sufficient
basis for issuance of the order.
B. What Constitutes Handling, Storage, Treatment,
Transportation or Disposal.
It is undisputed that S7003 may be utilized to enjoin
present conduct. Thus, persons who are presently handling,
storing, treating, transporting or disposing of solid or
hazardous wastes are potential recipients of a §7003 order.
Whether S7003 may be used to abate present imminent hazards
caused by past disposal practices is an issue that has been
litigated repeatedly. The Agency has consistently maintained
that S7003 applies to such past disposal. Although there has
been some disagreement by courts considering this question,
the prevailing view as expressed ir. U.S. v. Waste Industries,
etal., No. 83-1320 (4th Cir., May 8, 1984) clearly supports
the Agency's position. Thus, Regional Offices should consider
the issuance of §7003 orders at presently inactive facilities,
provided such issuance is consistent with this guidance.
C. Necessity for Existence of Imminent and Substantial
Endangerment.
Evidence possessed to support the issuance of a RCRA
§7003 order must show that the "handling, storage, treatment1,
transportation or disposal of any solid or hazardous waste may_
present an imminent and substantial endangerment to health or
the environment." The words "may present" indicate that
Congress established a standard of proof that does not require
a certainty. The evidence need not demonstrate that an immi-
569
-------
- 4 -
nent and substantial endangennent to public health or the
environment definitely exists. Instead, an order may be issued
if there is sound reason to believe that such an endangennent
may exist.
Evidence of actual harm is not required. As the Court
stated in Ethyl Corp. v. EPA, construing an endangennent
provision in the Clean Air Act:
The meaning of "endanger" is not disputed.
Case law and dictionary definition agree that
endanger means something less than actual harm.
When one is endangered, harm is threatened; no
actual injury need ever occur. 541 F.2d 1 at
13, footnotes omitted, original emphasis, D.C.
Cir., cert, denied 426 U.S. 941 (1976).
It should also be noted that while the risk of harm must
be imminent in order for the Agency to act under §7003, the
harm itself need not be. (See the legislative history to the
"imminent and substantial endangerment" provision of §1431 of
the Safe Drinking Water Act, H. Rpt. 93-1185 at 3536.) For
example, EPA could act if there exists a likelihood that
contaminants might be introduced into a water supply which
could cause damage after a period of latency. One must judge
the risk or likelihood of the harm by examining the factual
circumstances, including, but not limited to: 1) nature and
amount of the hazardous substance; 2) the potential for
exposure of humans or the environment to the substance; and
3) the known or suspected effect of the substance on humans
or that part of the environment subject to exposure to the
substance.
Legal analyses of the concept of imminent and substantial
endangerment can also be found in Reserve Mining Co. v. EPA,
546 F.2d 492 (8th Cir. 1975); U.S. v. Vertac Chemical Co.. et
al.t 489 F.Supp. 870 (E.D. Ark. 1980); U.S. v. Solvents
Recovery Service, 496 F.Supp. 1127 (D. Conn. 1980); U."S. v.
Midwest Solvent "Recovery, 484 F.Supp. 138 (N.D. Ind. 1980);
U.S. v. Diamond Shamrock Corp., 17 E.R. 1329, (N.D. Ohio
T91JT); U.S. v. Price, 688 F.2d 204 (.ird Cir. 1982); and, U.S.
v. ReilTyTar and Chemical Corp., 546 F.Supp. 1100 (D. Minn.
1982J:
The nature of the endangerment and the basis for the
finding of an imminent and substantial endangerment must be set
forth in the order. If sampling and analysis data are being
relied upon, a summary of such data should ordinarily be set
570
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- 5 -
forth in the order. At any rate, all evidence supporting the
finding of any imminent and substantial endangerment in the
order must be compiled into a single, concise document consti-
tuting the endangerment assessment. [An Endangerment Assessment
Guidance is presently being prepared by the Office of Solid
Waste and Emergency Response.]
D. Persons to Whom an Order May be Issued.
Section 7003 provides that an order may be issued to "any
person" who contributed to conduct or lack of conduct that may
present an imminent hazard. The term encompasses, if applicable,
the present owners and operators of a site, including an inactive
site. Similarly, the term includes persons whose ongoing
conduct may result in the risk of an imminent hazard. Whether
previous owners of a site or past non-negligent off-site
generators are also covered by S7003 is an issue that has
received much judicial attention.
Although the case law is unsettled, two courts have upheld
EPA's position that previous owners of a site may be held
liable under 57003. U.S. v. Price. 688 F.2d 204; U.S. v.
Reilly Tar and Chemical Co.. 546 F. Supp. 1100. Thus, if
otherwise appropriate, Regions should consider issuing §7003
orders to previous owners of a site, even an inactive one, in
cases where the previous owner's conduct may have caused or
contributed to conditions at the site which may present an
imminent hazard and substantial endangerment.
To date, the courts have been unwilling to include past,
non-negligent, off-site generators within the scope of S7003.
See. U.S. v. Wade. 546 F. Supp. 785 (E.D. Pa., 1982); U.S. v.
NEPACCO. 579 F. Supp. 823 (W.D. Mo., 1984) [U.S. filed cross-
appeal June 29, 1984; decision pending]. It is recommended,
therefore, that the Regional Offices utilize CERCLA §106 to
order such generators to perform necessary cleanup work. While
an early decision was unfavorable, the majority and all recent
decisions have held that S106 does apply: U.S. v. Wade. 546 F.
Supp. 785 [held S106 is not applicable to past, non-negligent
generators]; U.S. v. Price. 577 F. Supp. 1103 (D. N.J., 19830
[held S106 does apply to past, non-negligent generators]; U.S.
v. NEPACCO. 579 F. Supp. 823 [held S106 does apply to past,
non-negligent generators]; U.S. v. Conservation Chemical Company.
No. 82-0983-CV-W-5, Order (W.D. Mo., Feb. 3, 1984) [held §106
does apply to past, non-negligent generators]; and U.S. v.
A&F Materials, et al.. No. 83-3123 (S.D. 111., Jan.2TJ, 1984)
[held §106 does apply to past, non-negligent generators]. The
Agency's position is that §106 does apply to past, non-negligent,
off-site generators.
571
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- 6 -
E. Notice to Affected States
Finally, before an Order may be issued, the "affected
state" must be given notice of the Agency's intention to issue
the Order.
The Agency is not held to a statutory period of time for
notice. Normally, written notification to the state should
precede federal action by at least one week. Circumstances
may arise, however, where a more rapid response at a site is
necessary. In such cases, issuance of an order may follow an
abbreviated notice period or even a telephone call made by EPA
to the director of the agency responsible for environmental
protection in the affected state. Written confirmation must
follow such telephone notice. In somecases,the draft order
may be subject to a State's Freedom of Information Act prior to
issuance of the order by EPA. If this situation arises, the
Agency may delay notice to the affected state(s) until (no
later than) one week before issuance of the final order.
It is unlikely that a state FOIA request would result in early
disclosure of the draft order during that short period of
time.
As indicated above, the notification should be directed to
the director of the state agency having jurisdiction over
hazardous waste matters. A suggested form for a notification
letter is attached to this memorandum as the Appendix. This
font also provides the format for oral notice.
An "affected state" is a state in which the conduct or
condition which may present an imminent and substantial
endangerment is occurring or is located, and in which the
response activity required by the proposed order will be taken.
In some cases, this may involve more than one state, such as
where a facility is located near the border of a state and the
hazardous wastes have migrated from the facility into another
state(s). In those cases, all of the states in which the
hazardous wastes are found and in which response activity may
be performed pursuant to the order should be notified. (Note:
Consult the following guidance for more information on the
State/Federal relationship: "Implementing the State/Federal"
Relationship in Enforcement: State/Federal Enforcement
Agreements", OECM, June 6, 1984.')
III. SELECTING ENFORCEMENT OPTION
Although S7003 administrative orders are a potent
enforcement tool, there will be instances when it will be more
appropriate for the Agency to use other enforcement options,
including a RCRA S7003 judicial action, a CERCLA §106 adminis-
572
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- 7 -
trative or judicial action, or a Superfund financed cleanup of
.a hazardous waste site. The Regions should examine each of
these options and select the option which will result in the
most efficient use of limited enforcement resources and
Superfund monies while still quickly abating the threat.
(See also, the memorandum on "Issuance of Administrative Orders
for Immediate Removal Action", supra, for additional guidance
on selecting enforcement optionsT;
A. Administrative Order or Civil Referral
Initially, the Agency must determine whether it Is more
appropriate to use administrative or judicial enforcement
action; each has definite advantages and drawbacks. An admin-
istrative order has the benefit of being a relatively speedy
method of enforcement. The Agency can issue an order that
establishes a timetable for compliance, unilaterally or on
consent, in a short period of time. A judicial action, on the
other hand, is usually a more time-consuming process. The
referral of a case to the Department of Justice and filing of
a complaint may delay the initiation of remedial activities.
Even though a judicial action can be time-consuming, any
resulting judicial order or consent decree can be more quickly
enforced in the event of noncompliance since the Court already
has jurisdiction of the matter, and an additional referral
to DOJ generally is not needed.
Because AO1 s can be issued quickly, the general rule is
that an administrative order, whether issued unilaterally or
on consent, is appropriate absent some indication that the
respondent will not comply with its terms. Where noncompliance
is anticipated, Regions should prepare a civil referral.
Should immediate remedial action be necessary, EPA should
consider requesting a preliminary injunction or temporary
restraining order.
B. Use of RCRA or CERCLA
Once a decision has been made to proceed administratively,
the Region must then decide whether an order under RCRA §7003
or CERCLA S106 is more appropriate. Upon examination, both
statutory provisions appear quite similar. When faced with
the need to abate an imminent hazard, the Agency can often use
a joint order if the RCRA "hazardous waste" is also a CERCLA
"hazardous substance." [Consult the CERCLA S106 (1983) guidance
for a discussion of the issuance of joint orders.]
573
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- 8 -
There are three situations where a joint order is not
available, more specifically, where a RCRA S7003 order can be
used but a CERCLA §106 order cannot.
The first situation would result when the imminent hazard
is caused by a RCRA "solid waste" but not a "hazardous waste."
RCRA S7003 orders can be used to abate imminent hazards pre-
sented by "solid wastes" (RCRA §1004(27)) as well as "hazardous
wastes" (RCRA §1004(5)). By contrast, CERCLA §106 orders are
limited to abating imminent hazards presented by "hazardous
substances" (CERCLA §101(14), CERCLA §101(14)(c) defines
"hazardous substances" as including "hazardous wastes" under
RCRA §3001, but not RCRA "solid wastes" under §1004(27).
Therefore, when an imminent hazard is caused by a RCRA "solid
waste", which is not a RCRA "hazardous wastes" (or CERCLA
hazardous substance) RCRA §7003 orders can be issued, whereas
CERCLA §106 orders cannot.
The second situation would result when a waste meets the
definition of "hazardous wastes" under §1004(5) of RCRA but does
not qualify as a "hazardous waste" under 40 CFR Part 261. The
term "hazardous waste" in §7003 refers to the broad statutory
definition (§1004 (5)) of RCRA and not to the more narrow
regulatory provisions promulgated pursuant to §3001 and codi-
fied at 40 CFR Part 261. These regulatory provisions are
meant to be applied only in the Subtitle C regulatory program.
Because the CERCLA definition of "hazardous substances" (§101
(14); includes "hazardous wastes" under RCRA §3001 but not
under RCRA §1004(5), a CERCLA §106 order could not be
used in the above situation.
The third situation would result when the waste involved
is excluded from regulation under CERCLA because it is a petro-
leum product. [See, CERCLA §101(14) for the definition of
"hazardous substances"]. Gasoline is not a listed "hazardous
waste" or commercial chemical product under RCRA regulations
(40 CFR 261 Subpart D). Residues of a spill or a release of
gasoline are not automatically listed as hazardous. Even so,
gasoline leaking from underground storage tanks can be control-
led under RCRA as a "solid waste". As stated earlier, §7003
can be used to address wastes that satisfy the statutory defin-
ition of "hazardous waste" under RCRA §1004(5) even if they
are not listed or do not exhibit*a RCRA hazardous waste charac-
teristic under 40 CFR Subpart C. Orders have been issued
under RCRA §7003 to owners of underground storage tanks that
were leaking gasoline or other petroleum products.
574
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- 9 -
C. Deciding to Use a S7003 Order
This section discusses factors to consider when deciding
whether or not to use a S7003 order. These factors include:
- financial status of the respondents
- number of potential respondents
- specificity of the necessary response action
As a general proposition, a S7003 order should be issued
only in those situations in which compliance with the terms of
the order is feasible, i.e., where the respondents are in a
position to perform the ordered response actions within speci-
fied time periods. This does not mean that EPA must make a
pre-issuance determination that respondents will comply with
an order, but rather that compliance is practicable. If the
Agency anticipates non-compliance with an order it is
considering issuing, the use of the order mechanism may serve
only to delay initiation of an injunctive action under §7003
or, if appropriate, a Fund-Financed response. In addition,
it is an inefficient use of resources.
1) Respondent's Financial Status
Before an administrative order requiring remedial work
is issued, the Agency should assess, to the extent possible,
whether the responsible party has sufficient financial resources
to comply with the order. This assessment is only a factor to
be considered in the decision to issue an order when the neces-
sary information is available. Financial information may be
available from several sources:
0 Agency files may contain financial information
collected as part of the identification of
parties responsible for the hazards posed
by sites on the National Priorities List.
0 The Securities and Exchange Commission (SEC)
requires publicly traded companies to submit
detailed financial statements. This information
is publicly available. (Consult NEIC's manual
entitled "Identifying Responsible Parties" for
additional information on obtaining SEC
files.)
575
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- 10 -
* Responsible parties may submit financial
information to the Agency during discussions
or negotiations held prior to the issuance of
an Order.
c The Agency collects financial data as part of
the RCRA permitting process.
In addition, NEIC can provide further financial information
on respondents who are publicly held companies or companies
previously the subject of EPA action(s).
2) Number of Respondents Subject to the Order
The Agency's position that S7003 provides for joint and
several liability has been challenged by U.S. v. Stringfellow,
No. 83-2501 - MML (C.D. Cal., April 5, 1984^7 That decision
held that neither RCRA S7003 nor CERCLA 5106 provides for joint
and several liability. In the case of a multiple party adminis-
trative order, the Stringfellow Court stated that "...such
would have to state with specificity the steps to be taken and
the party to take them. If steps were ordered taken jointly,
the Court would have to prescribe the participation of each
defendant". (Slip. op. at 12.)
At present, the Agency has not changed its position on
S7003 and joint and several liability. Even so, the Stringfellow
decision may affect future S7003 orders issued to multiple
respondents without an allocation of individual responsibilities.
Some factors to consider before issuing a RCRA S7003 order
to multiple parties are as follows:
i) Coordination of Response Action
An order issued to multiple respondents who are
jointly and severally liable generally will not allocate
individual clean up responsibilities. _/ Instead, the order
will require the same response action to be conducted by each
responsible party. Multiple parties must organize and coordi-
nate their response to ensure compliance with the order's
requirements. Thus, compliance with orders may depend upon
group agreement on each member1 S4 share of the response cost.
In a large group of responsible parties, it may be difficult
for the group to develop a consensus on individual liability
and perform response activities as quickly as necessary to
*/ However, the Agency may issue an order to a respondent
requiring a response to a discrete, separable aspect of the
hazard at a site, notwithstanding the existence of other
responsibile parties or other less divisible problem areas.
576
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abate imminent hazard conditions at a site. Accordingly,
issuing Orders to all responsible parties may not be appro-
priate where there are a large number of parties who are
unlikely to agree on a concerted response. Instead, the Agency
will pursue judicial remedies or consider issuing Orders to a
selected subset of responsible parties.
Even in situations where Orders are issued to a large
number of parties, Agency policy, which should be reflected in
the terms of the Order, is that each Respondent is individually
liable for compliance with the Order's requirements.
ii) Supervision
After an order is issued, the Agency conducts
compliance monitoring at the site to ensure that responsible
parties comply with the terms of the order, Although no
specific number of responsible parties can be considered ideal,
it is clear that the Agency's oversight responsibility is most
effective when there are a limited number of responsible parties
or a single contractor (hired by the responsible parties) doing
the work at the site.
3) Specificity of the Necessary Response Action
In order to minimize the potential for confusion
between Respondents and the Agency concerning the required
response action, orders should be used in situations where the
nature of the required response action is relatively precise.
Orders are particularly useful to require that respondents
cease any ongoing activity that is causing the imminent hazard.
When remedial work is required, an order may best be used to
mandate discrete tasks such as the erecting of fences to secure
the site and the removal of drummed wastes. Orders can be
inappropriate in cases where the abatement will be very complex,
cost more than several million dollars, or take more than a few
years to complete. These are offered as factors to consider
and not criteria to be rigidly followed.
A RCRA S7003 order, or succession of orders, may be used
to require response action throughout the entire cleanup pro-
cess. It is entirely appropriate to use §7003 to order
immediate sampling or testing programs as part of a broader
set of proposed response activities. For example, where it
is important to respond immediately to an imminent hazard, a
S7003 order may be used to determine the full extent of site
contamination and to require immediate security and clean up
action in response to hazards that have already been established
577
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Monitoring, sampling, analysis and reporting can, of course,
also be required through use of a RCRA S3013 order. A S3013
order may be issued absent a finding of an imminent hazard
although it does require a finding that the presence of, or
release from a site of, hazardous waste "may present a substan-
tial hazard to human health or the environment." RCRA $3013(a)
(1)&(2). [See, Issuance of Administrative Orders Under Section
3013 of RCRA, issued September 1984.]
IV. ELEMENTS OF AN ORDER
All S7003 orders should contain the following elements:
0 a statement of the statutory basis for the order.
0 a statement of the agency's authority to issue
the order and the liability that may be incurred
if the respondent fails to comply.
e a specific determination supported by findings
or reference to a separate endangerment assessment
that states that the Agency has determined that an
imminent and substantial endangerment may exist.
Such an explicit finding is necessary even if the
Respondent is willing to consent to the issuance
of the order. Should EPA need to seek judicial
enforcement of the order, even one issued on
consent, it should be able to demonstrate that it
acted within its statutory authority in issuing the
order.
* the company is a facility es defined under CERCLA
§101(9). (Note; required only when the A.O. is also
based on CERCLA §106).
0 a finding that the substances are solid or
hazardous wastes.
0 statements as to the liability of the
respondents, i.e., that the responsible party
is or has been engaged in the activities
described in §7003.
o
a compliance schedule that clearly sets forth
the tasks to be performed, the time frames for
performance, and quality and performance stan-
dards for tasks. Such specificity enhances the
578
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operator's ability to comply and the Agency's
ability to enforce the order judicially should
the respondent violate its terns. A specific
order provides the court with Agency articulated
standards by which to judge the respondent's
noncompliance.
EPA authority to be on site during work, obtain
split samples and other information generated,
and stop work if an emergency arises.
0 sampling and analytical procedures.
0 health and safety procedures.
0 notice to affected States. A statement should
be included, where possible, that notice to the
affected state(s) has been given.
0 an opportunity to confer if the order is
unilateral. Agency policy is to offer
recipients of §7003 orders an opportunity to
confer with the Agency concerning the appro-
priateness of its terms and its applicability
to the recipient. (Note: The administrative record
containing EPA's evidence should be available for the
recipient to examine.) The conference will help EPA
ensure that it has based its order on complete
and accurate information and ensure that both
sides have a common understanding of the work
to be performed. Another benefit to such a
conference is that it may reveal the unwilling-
ness of the respondents to take necessary action.
In this case, EPA can be better prepared to
take necessary remedial action itself or seek
judicial remedies. (See also, Conference Procedures,
infra p. 14).
0 an effective date of the order. Each order
should specify the date on which it becomes
effective. Because a §7003 order by definition
addresses an imminent hazard, it should ordinarily
become effective within 10-14 days of receipt by
the respondent. In emergency situations the
effective date may be shortened to as little as
48 hours. Any situation that requires an
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affirmative response in less than 48 hours should
be addressed under S104 of CERCLA as a fund-
financed emergency removal. [Sjee_: Issuance of
Administrative Orders for Immediate Removal Actions.
supra, p. 2 (discussion of the timing of A.O.'s).]
0 indemnification of EPA. The order should exempt the
Agency from liability for damages, even if the damages
occurred pursuant to an EPA enforced order.
0 a public comment period for consent orders.
0 a civil penalties section for unilateral orders
and a stipulated penalties section for consent
orders.
0 EPA authority to take additional enforcement
action if the respondent does not comply with
the terms of this order.
V. CONFERENCE PROCEDURES
The conference will normally be held at the appropriate
EPA Regional office and will be presided over by the Regional
Administrator's designee. However, other arrangements may be
agreed to for the sake of convenience to the parties. At any
time after the issuance of the order and particularly at the
conference, EPA should be prepared to provide the Respondent
with information sufficient to explain the basis for the
Order and to promote constructive discussions. (NOTE; The
administrative record containing EPA's evidence must be avail-
able for the recipient to examine.) The Respondent will have
the opportunity to ask questions and present its views through
legal counsel or technical advisors. The schedule and agenda
for the conference will be left to the discretion of the EPA
official leading the conference, as long as the Respondent
receives a reasonable opportunity to address relevant issues.
Following the conference, a written summary of the
proceeding must be prepared and signed by the Agency official
who presided over the conference. The written statement should
contain:
0 A statement of the date(s) and attendees of any
conference(s) held; and
0 A description of the major inquiries made and
views offered by the Respondent contesting the
terms of the order.
580
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- 15 -
The presiding official must prepare a statement which
addresses the significant arguments raised by the respondent,
recommends how the order should be modified, if at all,
and contains the reasons for the changes or revisions.'
VI. MODIFICATIONS, REVOCATION. OR STAY OF THE ORDER
Based on a review of the file (on which the order was
based) any probative information or argument made by the
respondent (following receipt of the order) or by recommen-
dation of the presiding official, the issuing official may
modify or revoke the order. Any modification to the order
must be communicated to the respondent as part of a copy of a
written statement containing the elements listed in Section V
above. The original should be kept in the Agency files along
with the evidence supporting the order, copies of written
documents offered in rebuttal by the respondent during the
conference, and a copy of the request for a conference.
The issuing official may also stay the effective date of
the order if the conference process could not be completed
within the specified time period.
VII. NEGOTIATION OF ADMINISTRATIVE ORDERS
Although EPA recognizes that recipients of unilateral
S7003 orders should be given an opportunity to confer, the
Agency will not engage in lengthy negotiations with recipients
after an order is issued. Limited negotiations, before or
after issuance of an order, are useful in that they give EPA
an opportunity to assess the likelihood that the respondents
will perform the tasks set forth in the order. If negotiations
look unpromising EPA must decide whether to issue an order
unilaterally, refer a §7003 civil action or initiate a Fund-
Financed response (if this option exists). EPA should not
compromise its authority to secure necessary action simply to
obtain an order on consent.
Should negotiations result in an agreement, the resulting
order must contain all of the requirements set forth above;
these requirements are necessary to ensure that the order is
enforceable should the respondent decide not to comply. The
same requirements apply even if the respondent has voluntarily
begun cleanup efforts. In general, the negotiated order
should set out specifically what each respondent must do to
comply.
581
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VIII. DELEGATIONS OF AUTHORITY
At the present time, the authority to issue RCRA 57003
administrative orders is delegated to the Assistant Adminis-
trator for Solid Waste and Emergency Response and the Regional
Administrators. The Regional Administrator must consult with
the Assistant Administrator for Enforcement and Compliance
Monitoring or the designee and must obtain the advance
concurrence of the Assistant Administrator for Solid Waste
and Emergency Response or delegatee. The Assistant Adminis-
trator for the Office of Solid Waste and Emergency Response's
authority to issue S7003 orders and to give advance concurrence
has been redelegated to the Director, Office of Waste Programs
Enforcement.
The RCRA Delegations of Authority are being revised and
should be issued in the near future. The draft §7003 delegations
which are found in Chapter 8, Section 22 of the draft delegations
manual are divided into three parts: determination of imminent
and substantial endangerment; abatement through a unilateral
order; and, abatement through an order on consent.
According to the draft delegations, the Regional
Administrator (RA) must consult with the Office of Regional
Counsel before issuance of either a RCRA S7003 unilateral
order or order on consent. Regarding Headquarters, the RA
must consult with the Office of Solid Waste and Emergency
Response (OSWER) prior to issuing RCRA S7003 orders to deter-
mine an imminent and substantial endangerment and to abate
such an endangerment through a unilateral order. The RA is
not required to consult with the Offices of Enforcement and
Compliance Monitoring (OECM) or the Office of General Counsel
(OGC) to issue the above. For orders on consent under S7003,
the RA must obtain advance concurrence of OSWER or a waiver of
such concurrence by advance memorandum, before issuance of
such an order. The RA does not have to consult with or procure
concurrence from OECM or OGC prior to issuance of S7003 Orders
on consent. Consultation with OECM and OGC is recommended in
relatively new areas such as the use of a RCRA S7003 order for
underground gas tanks and where there are other novel legal
issues involved.
582
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Appendix
STATE NOTinCATION LETTER
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
Mr. R. Jones
State Agency
Division of Environmental Control
Dear Mr. Jones:
Enclosed for your information is a copy of an order
[stamped "DRAFT" and "CONFIDENTIAL"] that the Agency intends
to issue on or after [date] . to the XYZ Company, pur-
suant to Section 7003 of the Resource Conservation and Recovery
Act (42 U.S.C. S6973). The order requires certain activities
to be taken at the company's site located at [location] .
Please refer to the enclosed copy of the proposed order for
the specific actions required of the company and the time
within which such actions must be taken. If you have any
comments or questions concerning the order, please contact
[EPA official] at [office] .
Sincerely yours,
Assistant Administrator for
Solid Waste and Emergency Response
[or]
Regional Administrator
[or their designees]
Enclosure
cc: Honorable J. Smith, Governor
583
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Additional Information CERCLA Policy Compendium
******************
Related Documents That May Be Of Interest:
PROCEDURES MANUALS
2/82 Procedures for Identifying Responsible Parties: Uncontrolled Hazardous
Waste Sites—Superfund
U.S. Environmental Protection Agency Library
National Enforcement Investigations Center/OECM
Building 53, Box 25227
Denver Federal Center
Denver CO 80225
303/236-5170
8/84 RCRA/CERCLA Case Management Handbook
Government Institutes, Inc.
966 Hungerford Drive, #24
RockviUe, Maryland 20850
301/251-9250
TECHNICAL GUIDANCE
The following documents may be obtained at no charge from:
ORD Publications
Center for Environmental Research Information, USEPA-CERI
Cincinnati, OH 45268
513/569-7562
4/85 Modeling Remedial Actions at Uncontrolled Hazardous Waste Sites,
(EPA/540/2-85/001), Office of Solid Waste and Emergency Response
6/85 Guidance on Remedial Investigations Under CERCLA, EPA/540/G-85/002,
Office of Solid Waste and Emergency Response
6/85 Guidance on Feasibility Studies Under CERCLA, EPA/540/G-85/003,
Office of Solid Waste and Emergency Response
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