® EPA
Promoting Economic
Development
Region 9 • San Francisco, California
April 1995
The fear of potential Superfund
liability has become a signifi-
cant factor affecting the marketabil-
ity of real estate. Property that is
contaminated (or even suspected of
being contaminated) may be
difficult to sell because wary buyers
are concerned that they may
become liable for cleanup costs. In
an effort to reduce unnecessary
fears and disincentives to property
transactions, the EPA is now
moving ahead on a number of
fronts.
~	Removing
"No Action" Sites From
EPA Inventory
As of February 15, 1995, EPA
has removed almost 25,000 sites
from its computer database known
as CERCLIS, the Superfund
inventory of potential toxic waste
sites. These are sites which EPA
had screened and found did not
qualify for further EPA involve-
ment. These sites often had no
contamination or were being
cleaned up under state programs.
Even though EPA planned to take
no action on these sites, the fact
that they were listed on CERCLIS
caused many lenders, developers
and potential buyers to shy away
from them, fearful of liability. By
removing these sites from the list,
this misplaced fear should be
eliminated.
~	Issuing
Contaminated
Aquifer Policy
Within the next few months,
EPA will issue enforcement guid-
ance designed to reassure owners
whose property includes contami-
nated groundwater. EPA intends to
issue a policy statement saying that,
as a matter of enforcement discre-
tion, EPA does not anticipate suing
property owners where groundwa-
ter contamination has migrated to
their property. This will allow these
properties to be bought and sold
free from EPA enforcement action,
removing a serious roadblock to
reuse and redevelopment.
~ Negotiating Prospective
Purchaser Agreements
EPA is taking direct action to
eliminate liability on a case-by-case
basis through the use of prospective
purchaser agreements. Generally,
under these agreements, EPA will
promise not to sue the buyer for
existing contamination in exchange
for an appropriate cash or
work contribution	1 f
to the cleanup of	N\ g0V.D
the property. The buyer
can assign EPA's promise
not to sue, with certain
conditions, thus im-
proving the property's
future marketability.
Region 9's priority for consider-
ation of these agreements will focus
on contaminated parcels in Super-
fund sites on the National Priorities
List or sites undergoing a federal
removal action.
Region 9 is in the process of
concluding such an agreement with
Sargent Fletcher, Inc. Sargent
Fletcher is the prospective pur-
chaser of a 14-acre aerospace plant
located in El Monte, California
within the San Gabriel Valley
Superfund site. The former opera-
n in in
£? ll'M'"
tor, now bankrupt, released solvents
into the soil. Thus, the facility is
one of several potential sources of
groundwater contamination under
investigation at this exceptionally
large Superfund site. Under the
agreement, Sargent Fletcher will
not only apply funds toward
cleanup of the property, but it will
also have a positive effect on the
local community by keeping the
plant running with 400 employees
on the payroll.
~ Issuing Status
("Comfort") Letters to
Property Owners
Short of offering a promise
not to sue, EPA is exploring the
potential uses for letters to
property owners expressing the
status of the site under consider-
ation and EPA's en-
forcement intentions.
EPA sent status letters
to owners of property in
the San Gabriel Valley
after an investigation of
their property which
stated that EPA did not
intend to hold them liable for
contamination of the San Gabriel
aquifer based on present infor-
mation. These letters strike a
balance that avoids being a
definite "no action assurance"
letter, prohibited by current
Agency policy, while giving a
real level of comfort to a pro-
spective lessee or purchaser of
property located in a Superfund
site area.
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