ml
01
Revitalizing
Contaminated Sites:
Addressing Liability Concerns
The Revitalization Handbook
March 2011
U.S. Environmental Protection Agency
Office of Site Remediation Enforcement
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Cover photo capturing revitalized area provided by U.S. EPA's Region 8 Brownfields Program, The
LEED Gold Northside Aztlan Community Center in Fort Collins, Colorado, is now home to a wide
variety of classes, sports and events, with amenities such as a triple gymnasium, workout facilities,
lounge, game room, computer lab, classrooms, and connections to the Poudre River Trail. Beyond its
value as a community asset, the new Northside Aztlan Community Center is the first Leadership in
Energy and Environmental Design (LEED) Gold certified community center in the United States. Visit
http://www.epa.gov/superfund/programs/recvcle/index.html for more information on Superfund
Redevelopment.
EPA Pub. No. 33O-F-11-002
Office of Site Remediation Enforcement/Office of Enforcement and Compliance Assurance
U.S. Environmental Protection Agency
March 2011
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Preface iv
Commonly Used Acronyms and Abbreviations v
Purpose and Use of This Handbook vi
I. Overview of CERCLA and RCRA 1
A. CERCLA 1
1. General Information 1
2. EPA's Brownfields Program and the Brownfields Amendments 1
B. RCRA 2
II. Liability 4
A. CERCLA Liability 4
B. RCRA Liability 5
III. Statutory Protections and EPA Policies for the Cleanup, Reuse, and Revitalization of
Contaminated Sites 6
A. CERCLA Statutory Defenses and Liability Protections 6
1. Bona Fide Prospective Purchasers 7
2. Owners of Property Impacted by Contamination from an Off-site Source (Contiguous
Property Owners) 9
i. Contaminated Aquifers 9
ii. Contiguous Property Owners 10
3. Purchasers without Knowledge of Contamination 10
i. Third-Party Defense 11
ii. Innocent Landowner Liability Protection 11
4. Common Elements Guidance 12
B. State Response Programs 14
1. Voluntary Cleanup Programs 14
2. Memoranda of Agreement 15
3. Eligible Response Sites 15
C. Local Government Liability Protections 15
1. Involuntary Acquisition 16
2. Emergency Response 16
3. Land Banks 17
D. Lender Liability Protections 17
1. Lenders 18
2. Local Governments and Lender Liability 19
3. Underground Storage Tank (UST) Lender Liability Rule 20
E. Residential Property Owners 21
IV. Site-Specific EPA Tools to Address Status Liability Concerns, and/or Perceived Stigma 22
A. Comfort/Status Letters 22
1. Superfund Comfort/Status Letters 22
2. RCRA Comfort/Status Letters 23
3. Reasonable Steps Comfort Letter 23
4. Comfort Letters for National Priorities List Sites and Federally Owned Properties 24
B. Agreements 25
1. Bona Fide Prospective Purchaser Work Agreements 25
2. Prospective Purchaser Agreements and Prospective Lease Agreements 25
3. Windfall Lien Resolution 27
4. Contiguous Property Owner Assurance Letters and Settlements 27
C. Other Tools 27
1. Ready for Reuse Determinations 28
2. National Priorities List Deletion 28
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V. Other Considerations for Entities Seeking to Clean Up, Reuse, and Revitalize
Contaminated Property 29
A. Long-Term Stewardship 29
B. Supplemental Environmental Projects (SEPs) 30
C. OECA Guiding Principles 31
1. Environmental Justice 31
2. Public Participation 33
3. Financial Assurance 34
D. EPA Initiatives and Programs 34
1. ER3 - Environmentally Responsible Redevelopment and Reuse Initiative 35
2. Brownfields Grants and State/Tribal Funding 35
3. Superfund Redevelopment Initiative 36
4. RCRA Brownfields Prevention Initiative 36
5. RE-Powering America's Land Initiative 37
Table of Contents For Handbook Text Boxes
Disclaimers vii
Removal vs. Remedial Action 1
Components of the RCRA Corrective Action Program 5
BFPP Protections Apply to Tenants 7
Windfall Lien Guidance and Settlements 8
Threshold Criteria for EPA's Contaminated Aquifer Guidance 9
All Appropriate Inquiries 13
Affiliation 13
Meaning of "Involuntary Acquisition" 16
States with Land Bank Legislation 17
"Participation in Management" Defined 19
Threshold Criteria for Residential Property Owners Under EPA Guidance 21
Evaluation Criteria for Superfund Comfort/Status Letters 22
Private Party Tools 23
Differences Between BFPP Liability Protection and PPAs 26
Examples of Engineered Controls 29
Examples of Institutional Controls 30
Environmental Justice 32
Community Engagement Initiative: Public Participation in the Cleanup Process 33
Office of Brownfields and Land Revitalization Grants and Funding Web Access 36
Appendices
Appendix A
Appendix B
Appendix C
Appendix D
Appendix E
Common Elements Guidance
Top 10 Questions to Ask Before Buying a Superfund Site
CERCLA Liability and Local Government Acquisitions and Other Activities
Brownfields Enforcement and Land Revitalization Policy and Guidance Documents
Contact Information
MI
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Preface
The U.S. Environmental Protection Agency's (EPA) Office of Site Remediation Enforcement
(OSRE) implements the enforcement of EPA's hazardous waste cleanup laws, including the
Comprehensive Environmental Response, Compensation, and Liability Act (also known as
CERCLA or Superfund), the corrective action and underground storage tank cleanup provisions
of the Resource Conservation and Recovery Act (RCRA), and the Oil Pollution Act (OPA). The
main objective of the cleanup enforcement program is to ensure prompt site cleanup and the
participation of liable parties in performing and paying for cleanups in a manner that ensures
protection of human health and the environment.
Congress passed the Small Business Liability Relief and Brownfields Revitalization Act of 2002
(Public Law 107-118) (hereinafter, the Brownfields Amendments), which modified Superfund
and further promoted the cleanup, reuse, and redevelopment of sites by addressing liability
concerns associated with unused or under-utilized property. One important mission of OSRE is
to provide guidance on the liability protections available to property owners and other parties as
a result of the Brownfields Amendments and other federal laws governing contamination
cleanup. OSRE has played, and continues to play, a key role in the reuse and revitalization of
contaminated sites, including brownfield sites, by providing guidance and developing tools that
will assist parties seeking to clean up, reuse, or redevelop contaminated properties.
OSRE is committed to encouraging site reuse because it helps EPA achieve enforcement and
environmental protection goals, such as long-term site stewardship and sustainable land use
planning. Often, reuse can support these enforcement and environmental protection goals and
help remove obstacles to cleanups and revitalization. Over the years, OSRE has highlighted
these efforts through a series of handbooks, most recently Revitalizing Contaminated Sites:
Addressing Liability Concerns (2008) and the Brownfields Handbook: How to Manage Federal
Environmental Liability Risks (2002). This 2011 edition of the handbook, Revitalizing
Contaminated Sites: Addressing Liability Concerns (The Revitalization Handbook) is a
compilation of enforcement tools, guidance, and policy documents that are available to help
promote the cleanup and revitalization of contaminated sites.
While OSRE intends this handbook to be useful for years to come, it recognizes that
developments in the brownfields area will yield new policy and guidance documents.
Please refer to EPA's Brownfields and Revitalization website
(http://www.epa.gov/compliance/cleanup/revitalization) for new and updated documents.
OSRE looks forward to the challenge of protecting human health and the environment through
the cleanup and subsequent revitalization of contaminated property.
IV
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AAI
BFPP
Brownfields Amendments
CERCLA
CPO
DOJ
ER3
HSTF
ILO
Lender Liability Act
MOA
MOU
NCP
NPL
OBLR
OECA
OPA
OSRE
O&M
PLA
PPA
PRP
RCRA
RfR
SEP
SRI
TSD
UST
VCP
All Appropriate Inquiries
Bona Fide Prospective Purchaser
Small Business Liability Relief and Brownfields Revitalization
Act of 2002
Comprehensive Environmental Response, Compensation, and
Liability Act
Contiguous Property Owner
United States Department of Justice
Environmentally Responsible Redevelopment and Reuse
Initiative
Hazardous Substance Trust Fund
Innocent Landowner
Asset Conservation, Lender Liability, and Deposit Insurance
Protection Act of 1996
Memorandum of Agreement
Memorandum of Understanding
National Contingency Plan
National Priorities List
Office of Brownfields and Land Revitalization
Office of Enforcement and Compliance Assurance
Oil Pollution Act
Office of Site Remediation Enforcement
Operation and Maintenance
Prospective Lease Agreement
Prospective Purchaser Agreement
Potentially Responsible Party
Resource Conservation and Recovery Act
Ready for Reuse
Supplemental Environmental Project
Superfund Redevelopment Initiative
Treatment, Storage, and Disposal
Underground Storage Tank
Voluntary Cleanup Program
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: ~ :;; ; - ^ :.-. -: . ' - 's
This handbook summarizes the statutory and regulatory provisions of the Comprehensive
Environmental Response, Compensation, and Liability Act, 42 U.S.C. §§ 9601 et seq.
(CERCLA, commonly known as Superfund) and the Resource Conservation and Recovery Act,
42 U.S.C. §§ 6901 et seq. (RCRA), as well as the policy and guidance documents most useful in
managing environmental cleanup liability risks associated with the revitalization of contaminated
sites. It is designed for use by parties involved in the assessment, cleanup, and revitalization of
sites, and provides a basic description of the tools parties can use to address liability concerns.
There are a number of things a party may want to consider before revitalizing contaminated
property. For example:
A party should determine the end use of the property, and should collect and consider
information on past uses and potential contamination.
If a party intends to purchase the property, it should consider whether it needs to conduct
all appropriate inquiries to take advantage of CERCLA liability protections, such as the
bona fide prospective purchaser protection.
Should the party need information or have concerns about cleanup or liability protection,
it should identify the most appropriate level of government to consult.
A party may want to employ private mechanisms such as indemnification or insurance
tools (see Tools Between Private Parties text box), or work at the state level and make
use of existing state tools, programs, or incentives such as the state's voluntary cleanup
program. If contamination on the property warrants EPA's attention under CERCLA or
RCRA, a party should first determine if EPA or the state is taking or plans to take action
at the property. After determining where the property fits in the federal or state cleanup
pipeline, a party may use this handbook to help decide which tool or tools are most
appropriate for addressing potential CERCLA or RCRA liability risks.
Both CERCLA and RCRA are designed to protect human health and the environment from the
dangers of improperly disposed hazardous substances, though these two programs address
different parts of the hazardous waste problem. The RCRA programs focus on how wastes
should be managed to avoid potential threats to human health and the environment. CERCLA, on
the other hand, applies primarily when mismanagement has already occurred, resulting in
releases of hazardous substances to the environment. The two laws overlap in significant
respects, however; for example, both CERCLA and RCRA have cleanup authorities that may
apply to certain violations of waste management standards.
Though many prospective purchasers, developers, and lenders hesitate to get involved with
contaminated properties because they fear that they might be held liable under CERCLA or
RCRA, many contaminated properties may never receive EPA's attention under CERCLA,
RCRA, or any other federal law. Accordingly, parties' fears of federal involvement - to the
extent that they impact an entity's decision to get involved with a brownfield site rather than
actual EPA practice are often the primary obstacles to the redevelopment and reuse of
brownfields. EPA hopes that this handbook will provide a better understanding of these laws and
their implementation.
vi
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DISCLAIMERS
This document provides general information and guidance regarding facilitating reuse of
properties. It does not address all information, factors, or considerations that may be relevant.
This document is not legally binding. The word "should" and other similar terms used in this
document are intended as general recommendations or suggestions that might be generally
applicable or appropriate and should not be taken as providing legal, technical, financial, or other
advice regarding a specific situation or set of circumstances. This document may be revised at any
time without public notice.
This document describes and summarizes statutory provisions, regulatory requirements, and
policies. The document is not a substitute for these provisions, regulations, or policies, nor is it a
regulation itself. In the event of a conflict between the discussion in this document and any
statute, regulation, or policy, this document would not be controlling and cannot be relied upon to
contradict or argue against any EPA position taken administratively or in court. It does not
impose legally binding requirements on EPA or the regulated community, and might not apply to
a particular situation based upon the specific circumstances. This document does not modify or
supersede any existing EPA guidance document or affect the Agency's enforcement discretion in
any way.
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In 1980, in response to public concern about abandoned hazardous waste sites such as Love
Canal, Congress enacted the Comprehensive Environmental Response, Compensation, and
Liability Act (CERCLA), 42 U.S.C. §§ 9601 et seq. CERCLA, commonly referred to as
Superfund, authorizes the federal government to assess and/or clean up contaminated sites and
provides authority for emergency response involving hazardous materials.
CERCLA establishes a comprehensive liability scheme to hold certain categories of parties liable
to conduct and/or pay for cleanup of such releases. EPA may exercise its response authority
through removal or remedial actions. Remedial responses financed by the Hazardous Substance
Trust Fund are undertaken only at sites on EPA's National Priorities List (NPL). The National
Contingency Plan (NCP), 40 C.F.R. Part 300, provides the "blueprint" for conducting removal
and remedial actions under CERCLA.
REMOVAL vs. REMEDIAL ACTION
A generally is a short-term and/or emergency action that may be
necessary to address a release or threat of release of a hazardous substance into the
environment. CERCLA § 101(23). Removals may include adding security fencing,
providing alternate water supplies, or temporarily evacuating or relocating a community.
Depending on the amount of time available for planning, removal actions are classified as:
1) emergency; 2) time-critical; and 3) non-time-critical. Typically, removal actions are
limited to 12 months in duration or $2 million in response costs. CERCLA § 104(c)(l).
A remedial action generally addresses long-term threats to human health and the
environment caused by more persistent contamination sources. CERCLA § 101(24).
Remedial actions permanently and significantly reduce the risks associated with releases
or threats of releases of hazardous substances that are serious but lack the time-criticality
of a removal action.
There are many different types of contaminated or potentially contaminated property in the
United States. Some may be "Superfund sites"-- sites where the federal government is, or plans
to be, involved in cleanup efforts, many of which are listed on the NPL. Other properties may be
"brownfields"-- properties where expansion, redevelopment, or reuse may be complicated by the
presence (or potential presence) of contamination. Often, the federal government is not involved
in cleanups at brownfield sites. Rather, state and tribal response programs play a significant role
in cleaning up and helping to revitalize these sites. Other contaminated properties may be
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"RCRA brownfields" ~ RCRA facilities where reuse or redevelopment is slowed due to real or
perceived concerns about requirements imposed by RCRA for actual or potential contamination.
EPA launched the Brownfields Initiative in the mid-1990s and developed guidance and tools to
help further the Initiative's goals to empower states, communities, and other stakeholders to
assess, safely clean up, sustainably reuse, and prevent future brownfield sites.
Congress codified many of EPA's Brownfields Initiative practices, policies, and guidances when
it passed the Small Business Liability Relief and Brownfields Revitalization Act of 2002 (Public
Law 107-118) (Brownfields Amendments). The Brownfields Amendments define a brownfield
site as "real property, the expansion, redevelopment, or reuse of which may be complicated by
the presence or potential presence of a hazardous substance, pollutant, or contaminant."
CERCLA § 101(39). The Brownfields Amendments also include provisions to address the
liability concerns of certain landowners, provide statutory authority for EPA's brownfields grant
program, enable EPA to obtain a windfall lien on certain properties owned by bona fide
prospective purchasers, create a bar to EPA enforcement at certain brownfields sites being
addressed under state response programs, and authorize EPA to provide grants to states and
tribes to develop response programs.
As noted above, under CERCLA's liability scheme, the owner of a contaminated property is
responsible for the property's cleanup based solely on its ownership status, even if the owner did
not contribute to the contamination. As a result, entities that want to purchase contaminated
properties are often concerned about incurring CERCLA liability once they acquire the property.
To address these liability concerns, the Brownfields Amendments included new or clarified
liability protections for landowners who acquire property and continue to meet certain criteria
after acquisition. The three landowner liability protections addressed in the Brownfields
Amendments are for:
Bona fide prospective purchasers (BFPPs);
Contiguous property owners (CPOs); and
Innocent landowners (ILOs).
The CERCLA liability scheme and all these landowner liability protections and related cleanup
enforcement policy and guidance are discussed in Section III.
More information on the Superfund enforcement program is available on EPA's website at
http://www.epa.gov/compliance/cleanup/superfund/index.html. Information on the Superfund
program is available at http://www.epa.gov/superfund. EPA also hosts a website specifically
addressing brownfields issues at http://epa.gov/brownfields.
B. RCRA
In 1976, Congress enacted the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. §§
6901 et seq., which authorizes EPA to establish programs to regulate hazardous waste (Subtitle
C), solid waste (Subtitle D), and underground storage tanks (Subtitle I). RCRA's goals include:
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Protecting human health and the environment from hazards posed by waste disposal;
Conserving energy and natural resources through waste recycling and recovery;
Reducing the amount of waste generated; and
Ensuring that wastes are managed in an environmentally safe manner.
Through RCRA Subtitle C, Congress gave EPA the authority to manage hazardous waste from
"cradle to grave." There are Subtitle C regulations for the generation, transportation, and
treatment, storage, or disposal of hazardous waste. These regulations first identify the criteria to
determine which solid wastes are hazardous, and then establish various requirements for the
three categories of hazardous waste handlers: generators, transporters, and treatment, storage, or
disposal facilities (TSDs). In addition, the Subtitle C regulations set technical standards for the
design and safe operation of TSDs. These regulations for TSDs serve as the basis for developing
and issuing permits, which TSDs are required to obtain. Unlike CERCLA, RCRA does not
contain a bona fide prospective purchaser or similar liability protection.
Subtitle I authorizes EPA to establish a regulatory program that includes technical requirements
to prevent, detect, and clean up releases from underground storage tanks (UST). Tanks subject to
Subtitle I may be found at a variety of locations, including convenience stores, service stations,
small and large manufacturing facilities, and airports. Since the UST program is not part of
RCRA Subtitle C, there are separate technical and administrative requirements, including
notification, design and installation standards, and closure.
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LL,: /:- ;
This Chapter covers:
CERCLA Liability; and
RCRA Liability.
/^,, '- ; K'- L *
CERCLA's "polluter pays" liability scheme ensures that parties who have responsibility for
contamination, often referred to as potentially responsible parties (PRPs), rather than the general
public, pay for cleanups. As described in CERCLA § 107(a), the following categories of persons
may be held liable for the costs or performance of a cleanup under CERCLA:
(1) The current owner or operator of a facility;
(2) An owner or operator at the time of disposal;
(3) A person who arranged for the disposal or treatment of hazardous substances
("generator" or "arranger"); and
(4) A person who accepted hazardous substances for transport and selected the site to
which the substances were transported ("transporter").
Under CERCLA's comprehensive liability scheme, a PRP's liability for cleanup is:
- A party is liable if it falls within one of the above categories in CERCLA §
107(a) even if it did not act negligently or in bad faith.
- If two or more parties are responsible for the contamination at a site,
any one or more of the parties may be held liable for the entire cost of the cleanup,
regardless of their share of the waste contributed, unless a party can show that the injury
or harm at the site is divisible.
- A party may be held liable even if the hazardous substance disposal
occurred before CERCLA was enacted in 1980.
Additionally, EPA has adopted an "enforcement first" policy throughout the Superfund cleanup
process to compel those responsible for contaminated sites to take the lead in cleanup, thus
conserving taxpayer money. Using the enforcement authorities provided by Congress, EPA may
enter into settlements with or compel PRPs to implement a cleanup at a site where a release of
hazardous substances has occurred. When EPA spends Fund monies to finance a removal or
remedial action, EPA may then seek reimbursement from responsible parties. Private entities
may also conduct cleanups and seek reimbursement of eligible response costs from PRPs.
4
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Under RCRA Subtitle C, EPA has developed a comprehensive program to manage solid and
hazardous waste. Past and present activities at RCRA facilities have sometimes resulted in
releases of hazardous waste and hazardous constituents into soil, ground water, surface water,
and air. RCRA generally mandates that EPA require the investigation and cleanup, or
remediation, of these releases at RCRA facilities. This cleanup process is known as "corrective
action." EPA possesses several corrective action authorities to compel cleanup.
Owners/operators of facilities where releases have occurred are required to clean up
contamination caused by the mismanagement of wastes. The box below displays the components
of the corrective action process. Since the steps necessary to achieve cleanup at a facility will
depend on site-specific conditions, the corrective action process is flexible. The components may
occur in any order, and not every component is necessary to determine that no further action is
required.
COMPONENTS OF THE RCRA CORRECTIVE ACTION PROGRAM
Initial Site Assessment (RCRA Facility Assessment);
Release Assessment and Site Characterization (RCRA Facility Investigation);
Interim Actions to control or abate ongoing risks to human health and the environment
(Interim Measures);
Evaluation of different remedial alternatives to remediate the site (Corrective Measures
Study);
Remedy selection for a thorough cleanup of the hazardous release (Statement of Basis);
and
Design, construction, operation, maintenance, and monitoring of the chosen remedy
(Corrective Measures Implementation).
States are an integral part of the RCRA program. EPA may approve a state's or territory's
RCRA program to operate in lieu of EPA's program. EPA generally approves a state-
administered RCRA action program if the state requirements are no less stringent than the
federal requirements and the state has the ability to take adequate enforcement actions. In
authorized states, facilities must comply with the authorized state requirements rather than the
corresponding federal requirements. After authorization, both the state and EPA have the
authority to enforce those requirements.
Currently, 50 states and territories have been granted authority to implement the base, or initial,
program, and 42 states and the territory of Guam are authorized to operate the corrective action
program in lieu of EPA's program. Owners and operators of corrective action sites in authorized
states should also contact their state regulatory agency because the state program may have
different or more stringent requirements than the federal RCRA corrective action program.
More information on the RCRA state authorization program is available on EPA's website at
http://www.epa.gov/epawaste/laws-regs/state/index.htm. More information on the RCRA
cleanup enforcement program is available on EPA's website at
http://www.epa.gov/compliance/cleanup/rcra/.
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The Office of Site Remediation Enforcement (OSRE) in EPA's Office of Enforcement and
Compliance Assurance (OECA) is charged with enforcing CERCLA, RCRA corrective action,
underground storage tank programs, and aspects of the Oil Pollution Act, 33 U.S.C. § 2701 et
seq. (OPA). In this capacity, OSRE began to develop a comprehensive approach in the early
1990s to define liability issues and provide appropriate liability relief under these statutes to
assist with the redevelopment and revitalization of contaminated property. More specifically,
OSRE began to develop guidance documents to explain its understanding of liability under these
laws, as well as how and when EPA may exercise discretion to those who were interested in
redeveloping and revitalizing contaminated sites.
Partly in response to EPA's efforts, Congress enacted the Brownfields Amendments, amending
the Superfund statute to clarify certain landowner liability concerns and provide funding for
grants for the assessment and cleanup of contaminated property. EPA continues to promote site
cleanup by potentially responsible parties (PRPs) and private parties. EPA supports
revitalization through the issuance of enforcement discretion guidance documents, model
enforcement documents, responses to frequently asked questions, fact sheets, and other
documents that provide liability guidance or relief to potential developers and owners of
contaminated land. All these documents, along with all current Superfund enforcement and
brownfields policy and guidance documents, are available on EPA's website at
http://cfpub.epa.gov/compliance/resources/policies/cleanup/superfund/. Those enforcement
discretion documents that are relevant to revitalization are summarized in Appendix D of this
handbook.
More information on the Superfund enforcement program is available on EPA's website at
http ://www. epa. gov/oecaerth/cleanup/superfund/index.html. Information on the Superfund
program is available at http://www.epa.gov/superfund.
This Section covers:
Bona Fide Prospective Purchaser;
Contiguous Property Owners;
Third-Party Defense;
Innocent Landowner Liability; and
Common Elements Guidance.
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The 2002 Brownfields Amendments created a new liability protection for a bona fide prospective
purchaser (BFPP). Before the passage of the Brownfields Amendments, prospective purchasers
of contaminated property could not avoid the liability associated with being the current owner if
they purchased with knowledge of contamination, unless they entered into a prospective
purchaser agreement (PPA) with EPA before acquisition that included covenants not to sue
under CERCLA §§ 106 and 107. Now, however, as a result of the Brownfields Amendments, a
party can achieve and maintain status as a BFPP without entering into a PPA with EPA, so long
as that person meets the statutory criteria to assert the defense. A key advantage of the BFPP
protection is that it is self-implementing and, therefore, EPA is not required to make
determinations as to whether a party qualifies for BFPP status.
BFPP PROTECTIONS APPLY TO TENANTS
On January 14, 2009, EPA published its Enforcement Discretion Guidance Regarding the
Applicability of the Bona Fide Prospective Purchaser Definition in CERCLA § 101(40) to Tenants.
This guidance advises EPA regions on how to exercise enforcement discretion with regard to the
BFPP provision. Because leasehold interests may play a critical role in facilitating the cleanup and
reuse of brownfields and other contaminated properties, this guidance clarifies a tenant's
responsibilities with respect to BFPP status. The statute provides that tenants of BFPPs should be
treated as having BFPP status. Further, EPA, on a site-specific basis, intends to exercise its
enforcement discretion not to enforce against:
A tenant whose lease gives sufficient "indicia of ownership" to be considered an "owner" and
who meets the elements of §§ 101(40)(A)-(H) and 107(r)(l); and
A tenant of an owner who has lost BFPP status, if the tenant meets BFPP requirements.
This document is accessible on the internet at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/bfbp-tenant-mem.pdf.
The BFPP provision found in CERCLA § 107(r) dramatically changed the CERCLA liability
landscape by providing a method to establish a defense to liability for disposal that occurred
before acquisition. Section 107(r) protects from owner/operator liability a BFPP who acquires
property after January 11, 2002, and meets the criteria in CERCLA § 101(40) and § 107(r).
To successfully assert the innocent landowner defense, persons cannot know or have reason to
know about the contamination on the property. Now persons may acquire property knowing, or
having reason to know, of contamination on the property and not be liable under CERCLA as
long as they meet the statutory criteria for the BFPP defense.
BFPPs must perform "all appropriate inquiries" (AAI) before acquiring the property. BFPPs
cannot otherwise be a PRP at the site or have a prohibited "affiliation" with a liable party at the
site.
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BFPPs must also satisfy additional obligations throughout the period of ownership:
Complying with land use restrictions and not impeding the effectiveness or integrity of
institutional controls;
Exercising appropriate care with respect to hazardous substances found at the property,
including, among other things, taking "reasonable steps" to stop any continuing release
and to prevent any threatened future release;
Providing cooperation, assistance, and access;
Complying with information requests and administrative subpoenas; and
Providing legally required notices. CERCLA § 101(40).
BFPPs also must not impede the performance of a response action or natural resource
restoration. CERCLA § 107(r).
BFPPs are not liable as owner/operators for CERCLA response costs, but the property they
acquire may be subject to a windfall lien where an EPA response action has increased the fair
market value of the property. That is, the United States, after spending Superfund money for
cleanup at a property, may have a windfall lien on the property for the lesser of the unrecovered
response costs or the increase in fair market value at the property attributable to the Superfund
cleanup. The windfall lien provision is found in CERCLA § 107(r), and does not supplant the
lien provision found in CERCLA § 107(1).
WINDFALL LIEN GUIDANCE AND SETTLEMENTS
EPA and DOJ jointly issued guidance on the windfall lien provision, Interim Enforcement
Discretion Policy Concerning "Windfall Liens" Under Section 107 (r) of CERCLA, on July 16,
2003. EPA separately published the accompanying "Windfall Lien" Guidance Frequently Asked
Questions. In addition to explaining how EPA intends to perfect the windfall lien and when EPA
may seek to forclose on this lien, the guidance includes two attachments: 1) a sample "comfort
letter" that explains to the recipient whether EPA believes there is a possible windfall lien
applicable to the property; and 2) a model settlement document, which EPA may use to settle any
applicable windfall lien provision in exchange for monetary or other adequate consideration. This
guidance was also accompanied by a Windfall Lien Frequently Asked Questions fact sheet issued
on July 16,2003.
In January 2008, EPA issued another windfall lien guidance, titled Windfall Lien Administrative
Procedures and the associated Model Notice of Intent to File a Windfall Lien Letter. These
documents provide guidance on the timing for filing notice of a windfall lien on a property and
the EPA administrative procedures that should accompany filing a windfall lien notice.
For more discussion of resolution of windfall liens, please refer to Section IV.B.3.
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Owners of property above aquifers contaminated from an off-site source may be concerned about
CERCLA liability even though they did not cause and could not have prevented the ground
water contamination. Certain protections from liability for contiguous landowners may be found
in EPA guidance issued before and after the Brownfields Amendments.
In May 1995, OSRE developed the Final Policy Toward Owners of Property Containing
Contaminated Aquifers in response to this concern. EPA stated that it would not require cleanup
or the payment of cleanup costs if the landowner did not cause or contribute to the
contamination. It also stated that if a third party sued or threatened to sue, EPA would consider
entering into a settlement with the landowner covered under the policy to prevent third-party
damages being awarded.
THRESHOLD CRITERIA FOR EPA's CONTAMINATED AQUIFER GUIDANCE
A landowner may be covered by this policy. EPA will exercise its discretion or may enter into a
settlement if all the following criteria of policy are met:
The hazardous substances contained in the aquifer are present solely as the result of
subsurface migration from a source or sources outside the landowner's property;
The landowner did not cause, contribute to, or make the contamination worse through any act
or omission on his part;
The person responsible for contaminating the aquifer is not an agent or employee of the
landowner, and was not in a direct or indirect contractual relationship with the landowner
(exclusive of conveyance of title); and
The landowner is not considered a liable party under CERCLA for any other reason such as
contributing to the contamination as a generator or transporter.
This policy may not apply in cases where:
The property contains a ground water well that may influence the migration of contamination
in the affected aquifer; or
The landowner acquires the property, directly or indirectly, from a person who caused the
original release.
The policy identifies certain exceptions when the policy will not be applicable, including, among
others, when a well on the property may affect the migration of contaminants, or when there is a
contractual relationship between the landowner and the person causing the off-site
contamination. In addition, the policy required that the landowner must not be liable based on
some other connection to the site, such as being a generator or transporter.
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ii.
The Brownfields Amendments provide statutory protection for contiguous property owners
(CPOs). Specifically, CERCLA § 107(q) excludes from the definition of "owner or operator" a
person who owns property that is "contiguous," or otherwise similarly situated to, a facility that
is the only source of contamination found on the person's property. Like the contaminated
aquifer policy, this provision protects parties that are victims of pollution caused by a neighbor's
actions.
To qualify as a statutory CPO, a landowner must meet the criteria set forth in CERCLA §
107(q)(l)(A). A CPO must perform AAI before acquiring the property, and demonstrate that it is
not affiliated with a liable party at the time of purchase and throughout its ownership of the
property (for more on affiliation requirements, please see the text box on the same subject).
Persons who know, or have reason to know, before purchase, that the property is or could be
contaminated, cannot qualify for the CPO liability protection under the Brownfields
Amendments, although such parties may still be entitled to rely on the BFPP statutory defense or
EPA may exercise its enforcement discretion not to pursue such persons, as set forth in EPA's
1995 contaminated aquifer guidance. Like BFPPs, CPOs must also satisfy ongoing obligations
after purchase.
On January 13, 2004, EPA issued its Interim Enforcement Discretion Guidance Regarding
Contiguous Property Owners (Contiguous Property Owner Guidance), which discusses
CERCLA §107(q) and may be found at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/contig-prop.pdf.
The guidance addresses: 1) the statutory criteria; 2) the application of CERCLA §107(q) to
current and former owners of property; 3) the relationship between section 107(q) and EPA's
Residential Homeowner Policy and Contaminated Aquifers Policy; and 4) discretionary
mechanisms EPA may provide to resolve remaining liability concerns of contiguous property
owners. The guidance document was followed by a Contiguous Property Owner Reference
Sheet, which is available on the internet at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/contig-prop-faq.pdf
Moreover, on November 9, 2009, EPA drafted a model CERCLA Section 107(q)(3) CPO
assurance letter in accordance with the 2004 enforcement discretion guidance mentioned above.
Use of such letters is limited to several types of enumerated circumstances and is anticipated to
be rare because CERCLA 107(q) is self-implementing. For more information on CPO assurance
letters, see http://www.epa.gov/compliance/resources/policies/cleanup/superfund/cpo-assure-
mod-ltr-mem.pdf.
3, of
Entities that acquire property and had no knowledge of the contamination at the time of purchase
might be eligible for CERCLA's third-party defense or innocent landowner defense, in addition
to the BFPP defense.
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i.
CERCLA § 107(b) includes the following defenses to liability if a person can show, by a
preponderance of the evidence, that the contamination was solely caused by:
An act of God (CERCLA § 107(b)( 1));
An act of war (CERCLA § 107(b)(2)); or
The act or omission of a third party (CERCLA § 107(b)(3)).
To invoke CERCLA's § 107(b)(3) third-party defense, the third party's act or omission must not
occur "in connection with a contractual relationship." Moreover, an entity asserting the
CERCLA § 107(b)(3) defense must show that: a) it exercised due care with respect to the
contamination; and b) it took precautions against the third party's foreseeable acts or omissions,
and the consequences that could foreseeably result from such acts or omissions.
ii. -... j.
The Superfund Amendments and Reauthorization Act of 1986 (Public Law 96-510) expanded
the third-party defense by creating innocent landowner exclusions to the definition of a
"contractual relationship." The 2002 Brownfields Amendments later clarified the innocent
landowner liability protection. Previously, the deed transferring title between a PRP and the new
landowner was a "contractual relationship" that prevented the new landowner from raising the
traditional CERCLA § 107(b)(3) third-party defense. To promote redevelopment and provide
more certainty, Congress created the "innocent landowner defense," which requires an entity to
meet the criteria set forth in CERCLA § 101(35) in addition to the requirements of CERCLA §
107(b)(3). CERCLA § 101(35)(A) distinguishes between three types of innocent landowners:
Purchasers who acquire property without knowledge of contamination and who have no
reason to know about the contamination, CERCLA § 101(35)(A)(i);
Governments "which acquired the facility by escheat, or through any other involuntary
transfers or acquisition, or through the exercise of eminent domain authority by purchase
or condemnation," CERCLA § 101(35)(A)(ii); and
Inheritors of contaminated property, CERCLA § 101(35)(A)(ii).
For all three types of landowners, the facility must be acquired after the disposal or placement of
the hazardous substances on, in, or at the facility. Further, a set of continuing obligations similar
to what is required of BFPPs also applies. CERCLA § 101(35)(A).
For purchasers who acquire property without knowledge of contamination, an owner must have
conducted AAI before purchase and complied with other pre- and post-purchase requirements.
The 2002 Brownfields Amendments also elaborated on the AAI requirement. See the "All
Appropriate Inquiries" text box in this handbook.
11
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The innocent landowner defense may provide liability protection to some owners of
contaminated property especially those that purchased property before January 1, 2002, and
are therefore ineligible for the BFPP protection but generally most post-2002 prospective
purchasers are unlikely to rely on this defense because of the requirement that the purchaser have
no knowledge of contamination at the site at the time of acquisition.
Several of EPA's guidance documents discuss the ILO liability protection, including the
Common Elements guidance, discussed below. The Common Elements guidance is also included
at Appendix A.
4. Common Elements Guidance
In March 2003, EPA issued its "Common Elements" guidance for the three property owner
classes bona fide prospective purchaser (BFPP), contiguous property owner (CPO), and
innocent purchaser (ILO) addressed in the Brownfields Amendments. See Interim Guidance
Regarding Criteria Landowners Must Meet in Order to Qualify for Bona Fide Prospective
Purchaser, Contiguous Property Owner, or Innocent Landowner Limitations on CERCLA
Liability ("Common Elements ").
The guidance was accompanied by the "Common Elements" Guidance Reference Sheet, also
issued on March 6, 2003, which highlights the significant points of the guidance. Both of these
documents are available in Appendix A of this handbook.
The Brownfields Amendments identify threshold criteria and ongoing obligations that these
types of landowners must meet to obtain the liability protections afforded by the statute. Many of
these obligations are overlapping and thus the shorthand name ("Common Elements") for the
guidance. Included with the guidance are three documents:
(1) A chart laying out the common statutory obligations;
(2) A questions and answers document pertaining to the "reasonable steps" statutory
criteria; and
(3) A model comfort/status letter for providing site-specific suggestions as to reasonable
steps.
The Common Elements guidance first discusses the threshold criteria BFPPs, CPOs, and
innocent landowners must meet to assert these liability protections.
The first threshold requirement is that the landowner must perform all appropriate inquiries
(AAI) before purchasing the property. CERCLA §§ 101(40)(B), 107(q)(l)(A)(viii),
12
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ALL APPROPRIATE INQUIRIES
BFPPs, CPOs, and innocent landowners must all undertake "all appropriate inquiries" (AAI) under
CERCLA § 101(35)(B) before acquiring property to obtain liability protection. CERCLA § 101(35)(B)
required EPA to publish a regulation to "establish standards and practices for the purpose of satisfying
the requirement to carry out [AAI] . . . ." EPA's All Appropriate Inquiries Rule ("AAI Rule"), 40
C.F.R. Part 312, became final on November 1, 2006 (70 FR 66070). Parties affected by the AAI Rule
are those purchasing commercial or industrial real estate who wish to take advantage of CERCLA's
new liability protections, and those persons conducting a site characterization or assessment with funds
provided by certain federal brownfields grants.
For more information on the AAI Rule, please visit http://www.epa.gov/brownfields/aai/.
Second, the BFPP and CPO protections require that the purchaser not be "affiliated" with a liable
party, CERCLA §§ 101(40)(H), 107(q)(l)(A)(ii), and for the innocent landowner defense, the act
or omission that caused the release or threat of release of hazardous substances and the resulting
damages must have been caused by a third party with whom the purchaser does not have an
employment, agency, or contractual relationship. CERCLA §§ 107(b)(3), 101(35)(A).
AFFILIATION
The BFPP and CPO liability protections require that the purchaser or owner of the property at issue
not be "affiliated" with a person that is potentially liable at that property. For both liability
protections, "affiliation" includes a familial, contractual, financial, or corporate relationship. The
affiliation language is found in Section 101(40) for those seeking liability protection as a BFPP,
while the affiliation language for a CPO is found in Section 107(q)(l)(A). The CPO affiliation
language differs from the BFPP affiliation language in that there is no exception for relationships
created by the instruments by which title to the facility is conveyed or financed. Except for this
difference, the affiliation language in the BFPP and CPO provisions is virtually identical. EPA has
issued guidance detailing how it will implement the affiliation language in the exercise of its
enforcement discretion.
Third, the Common Elements guidance discusses the common ongoing obligations for each type
of landowner liability protection, identified as follows:
Complying with land use restrictions and not impeding the effectiveness or integrity of
institutional controls;
Taking "reasonable steps to prevent releases" with respect to hazardous substances
affecting a landowner's property;
Providing cooperation, assistance, and access to the property;
Complying with information requests and subpoenas; and
Providing legally required notices.
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Prospective purchasers or owners of contaminated property may want to use the Common
Elements guidance to understand the different liability protections that may be available and
their requirements.
'.in '- _:-.'_. - ... - ,: '
This Section covers:
Voluntary Cleanup Programs;
Memoranda of Agreement; and
Eligible Response Sites.
1. "
State response programs play a significant role in assessing and cleaning up brownfield sites. As
Congress recognized in the legislative history of the Brownfield Amendments,
"ftjhe vast majority of contaminated sites across the
Nation will not be cleaned up by the Super fund
program. Instead, most sites will be cleaned up under
State authority."
Voluntary cleanup programs (VCPs) are typically programs authorized by state statutes to
address brownfield and other lower-risk sites. Links to state VCPs can be found on EPA's
website at http://www.epa.gov/compliance/cleanup/revitalization/state.html.
EPA has historically supported the use of VCPs and continues to provide grant funding to
establish and enhance VCPs. EPA also continues to provide general enforcement assurances to
individual states to encourage the assessment and cleanup of sites addressed under VCP
oversight. This approach to VCPs was codified in the Brownfields Amendments as CERCLA §
128:
CERCLA § 128(a) addresses grant funding and memoranda of agreement (MOAs) for
state response programs (i.e., VCPs);
CERCLA § 128(b) addresses the "enforcement bar," which limits EPA enforcement
actions under CERCLA §§ 106(a) and 107(a), at "eligible response sites" addressed in
compliance with state response programs that specifically govern cleanups to protect
human health and the environment; and
CERCLA § 128(b)(l)(C) addresses the establishment and maintenance of a public record
by a state to document the cleanup and potential use restrictions of sites addressed by a
VCP.
14
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2, of
Since 1995, EPA has encouraged the use of voluntary cleanup programs (VCPs) at lower-risk
sites by entering into non-binding memoranda of agreement (MO As) with interested states based
on a review of the state VCP's capabilities. MO As can be a valuable mechanism to support and
strengthen efforts to achieve protective cleanups under VCP oversight. The purpose of the
MOAs is to foster more effective and efficient working relationships between EPA and
individual states regarding the use of their VCPs. Specifically, MOAs define EPA and state roles
and responsibilities and provide EPA recognition of the state's capabilities. MOAs typically
include a general statement of EPA enforcement intentions regarding certain sites cleaned up
under the oversight of a VCP. A number of states are also using their VCPs to address facilities
subject to corrective action under the Resource Conservation and Recovery Act (RCRA). As a
result, EPA and several states have expanded upon the CERCLA VCP MOA concept to address
some facilities subject to RCRA corrective action. Those agreements are commonly known as
RCRA Memoranda of Understanding (MOUs). EPA has also entered into a few MOAs that
address multiple cleanup programs and are consistent with EPA's One Cleanup Program. More
information on EPA's One Cleanup Program is available on EPA's website at
http ://www. epa. gov/oswer/onecleanupprogram/.
Copies of specific MOAs or MOUs, and additional information about state and tribal response
programs are available from EPA's website at
http://www.epa.gov/brownfields/state_tribal/moa_mou.htm.
3,
The Brownfields Amendments included the concept of an "eligible response site" (CERCLA §
101(41)), which is a site at which EPA may not take an enforcement action under §§ 106 or 107
if it is already being cleaned up under a state response program, and which may be eligible for
deferral from listing on the National Priorities List (NPL) in certain circumstances. CERCLA §§
128(b), 105(h). If an EPA Region determines that a site is not an "eligible response site," that site
will not be subject to the deferral provisions in § 105(h) and the limitations on EPA's
enforcement and cost recovery authorities under § 128(b). For more information on eligible
response sites, please see EPA's March 2003 guidance, Regional Determinations Regarding
Which Sites Are Not "Eligible Response Sites " at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/reg-determ-small-bus-
mem.pdf.
C. ,'>;.' >,>,'-: ,>; <,".':
This Section covers:
Involuntary Acquisition;
Emergency Response; and
Land Banks.
15
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CERCLA provides that a unit of state or local government will not be considered an owner or
operator of contaminated property (and thus will be exempt from potential CERCLA liability as
a PRP) if the state or local government acquired ownership or control involuntarily. This
provision includes a non-exhaustive list of examples of involuntary acquisitions, including
obtaining property through bankruptcy, tax delinquency, abandonment, or "other circumstances
in which the government entity involuntarily acquires title by virtue of its function as a
sovereign." CERCLA § 101(20)(D). It is important to note that this exclusion will not apply to
any state or local government that caused or contributed to the release or threatened release of a
hazardous substance from a facility.
MEANING OF "INVOLUNTARY ACQUISITION"
In EPA's 1995 Municipal Immunity from CERCLA Liability for Property Acquired through
Involuntary State Action, EPA stated that an involuntary acquisition or transfer includes one "in
which the government's interest in, and ultimate ownership of, a specific asset exists only because the
conduct of a non-governmental party...gives rise to a statutory or common law right to property on
behalf of the government." EPA acknowledges that tax foreclosure and other acquisitions by
government entities often require some affirmative or volitional act by the local government.
Therefore, a government entity does not have to be completely passive during the acquisition in order
for the acquisition of property to be considered "involuntary" under CERCLA. Instead, EPA
considers an acquisition to be "involuntary" if the government's interest in, and ultimate ownership
of, the property exists only because the actions of a non-governmental party give rise to the
government's legal right to control or take title to the property.
Municipal Immunity from CERCLA Liability for Property Acquired through Involuntary State Action
may be found at http://www.epa.gov/compliance/resources/policies/cleanup/superfund/immunitv-
cercla-mem.pdf
CERCLA § 101(35)(A)(ii) also discusses involuntary acquisitions in the context of the innocent
landowner defense pursuant to CERCLA § 101(35)(A). Please see Section III.A.S.ii for further
detail.
For more information on state and local government involuntary acquisition, see EPA's website
at http://www.epa.gov/compliance/cleanup/revitalization/local-acquis.html. EPA's CERLCA
Liability and Local Government Acquisition and Other Activities is included in Appendix C.
Local units of government, especially fire, health, and public safety departments, are often the
first responders to emergencies and dangerous situations at contaminated properties in their
communities. So as not to interfere with these activities, Congress included the emergency
response exemption in CERCLA § 107(d)(2). Under this provision, state or local governments
will not be liable for "costs or damages as a result of actions taken in response to an emergency
created by a release or threatened release of a hazardous substance." To qualify, the state or
local government must not own the property and must not act in a grossly negligent manner or
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intentionally engage in misconduct. Further, EPA may reimburse local governments up to
$25,000 for the costs of temporary measures under CERCLA § 123.
o.
An increasing number of states and municipalities are passing legislation that authorizes land
banks. Enabled by state legislation and enacted by local ordinances, a land bank is a
governmental entity or nonprofit that acquires, holds, leases, and/or manages vacant, abandoned,
and tax delinquent properties. They are charged with bringing such properties into productive
use. Land banks can allow local governments to overcome redevelopment barriers that prevent
the conversion of underutilized land to higher uses. They can also facilitate land reuse while
advancing public policy goals such as provision of affordable housing, stabilization of
neighborhoods, development of open space, revitalization of brownfields, smart growth
planning, and a reduction of crime, potential fire hazards, and urban blight.
Although the responsibilities of land banks will vary according to state law and the authorizing
legislation, common responsibilities and authorities of a land bank include inventory of vacant
and abandoned properties, acquisition, property management, property disposition, and waiver of
delinquent taxes.
STATES WITH LAND BANK LEGISLATION
Michigan
Ohio
Georgia
Indiana
Texas
Kentucky
Maryland
Missouri
Tennessee
While many land bank properties may not be contaminated, it is important to be aware of the
potential for contamination. Purchasers of property from a land bank may want to assess whether
there is an applicable CERCLA exemption, affirmative defense, or liability protection. These
concerns also apply in the local government context. Whether a local government acquiring a
land bank property will qualify under the involuntary acquisition exemption, BFPP, or the third -
party defense will be determined on a case-by-case basis.
In the 1990s, it became apparent to EPA and DOJ that liability concerns and fears of
enforcement were discouraging financial institutions from lending money to developers of
contaminated land, and municipalities from exercising their governmental involuntary acqui-
sition rights and performing cleanup functions on such properties.
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EPA initially tried to address the concerns of lenders and municipalities through the Lender
Liability Rule promulgated in 1992. A federal court vacated the rule, however, on the ground
that "EPA lacked authority to issue" the rule as a binding regulation. Kelly v. EPA, 15 F.3d 1100
(D.C. Cir. 1994), reh. denied, 25 F.3d 1088 (D.C. Cir. 1994), cert, denied, Am. Bankers Ass'n v.
Kelly, 115 S.Ct. 900 (1995). After the court decision, EPA and DOJ issued the Policy on
CERCLA Enforcement Against Lenders and Government Entities that Acquire Property Invol-
untarily on September 22, 1995, which stated that EPA and DOJ were not precluded from
following the provisions of the rule as enforcement policy.
This Section covers:
Lenders;
Local Governments and Lender Liability; and
Underground Storage Tank Lender Liability Rule Lenders.
1. Lenders
On August 1, 1996, EPA issued a fact sheet summarizing EPA's position on lender liability titled
The Effect of Superfund on Lenders That Hold Security Interests in Contaminated Property.
Lenders were concerned, however, that EPA's 1995 enforcement policy did not apply to
contribution actions brought by third parties attempting to recover their CERCLA response costs
from lenders. Partly in response to these concerns, Congress enacted the Asset Conservation,
Lender Liability, and Deposit Insurance Protection Act of 1996, 110 Stat. 3009-462
(1996)("Lender Liability Act").
Section 2502 of the Lender Liability Act amended CERCLA's secured creditor exemption
contained in CERCLA § 101(20)(E). Using language very similar to the language of the
CERCLA Lender Liability Rule, Congress in CERCLA §§ 101(20)(E)-(G) elaborated on the
original exemption by defining key terms and listing activities that a lender may undertake
without forfeiting the exemption. Under the statute, a lender is not an "owner or operator" under
CERCLA if, "without participating in the management" of a vessel or facility, it holds indicia of
ownership primarily to protect its security interest. CERCLA § 101(20)(E)(i). "Participation in
management" is further defined in the statute in § 101(20)(F). Additional information is available
in the "Participation in Management" text box below.
After the enactment of the Lender Liability Act, EPA issued guidance to further clarify the
circumstances in which EPA will apply the provisions of the Lender Liability Rule and its
preamble in its interpretation of CERCLA's secured creditor exemption. See Policy on
Interpreting CERCLA Provisions Addressing Lenders and Involuntary Acquisitions by
Government Entities (October 1995). EPA's subsequent Policy on Interpreting CERCLA
Provisions Addressing Lenders and Involuntary Acquisitions by Government Entities (June
1997) explains that when interpreting the amended secured creditor exemption, EPA will treat
the Lender Liability Rule and its preamble as authoritative guidance.
18
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"PARTICIPATION IN MANAGEMENT" DEFINED
A lender "participates in management" (and will not qualify for the exemption) if the lender:
Exercises decision-making control over environmental compliance related to the facility, and in
doing so, undertakes responsibility for hazardous substance handling or disposal practices; or
Exercises control at a level similar to that of a manager of the facility, and in doing so, assumes
or manifests responsibility with respect to day-to-day decision-making on environmental
compliance; or
Exercises all, or substantially all, of the operational (as opposed to financial or administrative)
functions of the facility other than environmental compliance.
The term "participate in management" does not include certain activities such as when the lender:
Inspects the facility;
Requires a response action or other lawful means to address a release or threatened release;
Conducts a response action under CERCLA § 107(d)(l) or under the direction of an on-scene
coordinator;
Provides financial or other advice in an effort to prevent or cure default; or
Restructures or renegotiates the terms of the security interest; provided the actions do not rise to
the level of participating in management.
After foreclosure, a lender who did not participate in management before foreclosure is not an "owner
or operator " if the lender:
Sells, releases (in the case of a lease finance transaction), or liquidates the facility;
Maintains business activities or winds up operations;
Undertakes an emergency response or action under the direction of an on-scene coordinator; or
Takes any other measure to preserve, protect, or prepare the facility for sale or disposition;
provided the lender seeks to divest itself of the facility at the earliest practicable, commercially
reasonable time, on commercially reasonable terms. EPA considers this test to be met if the
lender, within 12 months of foreclosure, lists the property with a broker or advertises it for sale
in an appropriate publication.
Section 2504 of the Lender Liability Act codifies the portion of the CERCLA Lender Liability
Rule that addresses involuntary acquisitions by government entities. State or local governments
that acquire property by involuntary means such as bankruptcy, tax delinquency, or abandonment
are excluded from the definition of "owner or operator" in CERCLA, and therefore are not liable
under CERCLA Section 107(a), if they did not otherwise cause or contribute to contamination at
the facility. CERCLA § 101(20)(D). There is also an innocent landowner affirmative defense
available for government entities that acquire property "by escheat, or through any other
involuntary transfer or acquisition, or through the exercise of eminent domain authority by
purchase or condemnation." CERCLA § 101(35)(A)(ii). Governments should be aware,
however, that additional conditions, criteria, and continuing obligations must be met as part of
the innocent landowner defense.
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EPA's Policy on Interpreting CERCLA Provisions Addressing Lenders and Involuntary
Acquisitions by Government Entities (October 1995) and Policy on Interpreting CERCLA
Provisions Addressing Lenders and Involuntary Acquisitions by Government Entities (June
1997) provide guidance on lender liability. Involuntary acquisition issues are further clarified by
EPA's Municipal Immunity from CERCLA Liability for Property Acquired through Involuntary
State Action (October 1995) and The Effect of Superfund on Involuntary Acquisitions of
Contaminated Property by Government Entities (December 1995). EPA continues to follow
these documents as guidance when addressing local government liability.
State or local government entities that acquire property after the enactment of the 2002
Brownfields Amendments and are concerned about potential contamination may want to seek the
advice of legal counsel before taking title to ensure that they will have liability protection (e.g.,
BFPP status or protection under the involuntary acquisition provision or third-party defense).
State or local government entities should note that to achieve BFPP status, an entity must con-
duct AAI before purchase and comply with the other BFPP requirements (CERCLA §§
101(40)(A)-(H), 107(r)(l)). Conducting proper AAI before purchase is also important for state
and local government entities relying on the BFPP protection for brownfield grant eligibility.
3, Tai " ;-.' ' .
Local communities often struggle with what to do about polluted, abandoned gas stations and
other petroleum-contaminated properties, generally referred to as petroleum brownfields, which
can be eyesores and blight communities. Often, citizens and businesses shy away from the reuse
potential of these properties, fearing the potential liability of environmental contamination under
Subtitle I of RCRA. The Underground Storage Tank (UST) Lender Liability Rule (40 C.F.R. §§
280.200-.230) provides one method by which EPA has addressed fears of potential liability to
encourage the reuse of abandoned gas station sites.
While developing the UST Lender Liability Rule, EPA recognized that many security interest
holders were abandoning the UST properties they held as collateral instead of foreclosing on
those properties and risking potential liability for cleanup costs.
The UST Lender Liability Rule exempts certain classes of "owners" and "operators" (i.e.,
holders of security interests as described in the rule) from identified RCRA regulatory
requirements including corrective action, technical requirements, and financial responsibility,
provided that specified criteria are met.
By allowing security interest holders to market their foreclosed properties without incurring
RCRA liability, the UST Lender Liability Rule encourages the reuse of gas stations that may
otherwise end up abandoned. The rule also protects human health and the environment by
requiring security interest holders to empty any tanks they acquire through foreclosure, thus
preventing future releases. Additional information on the UST Lender Liability Rule is available
on EPA's website at http://www.epa.gov/oust/fedlaws/280 i.pdf
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In 1991, EPA issued its Policy Towards Owners of Residential Properties at Super/and Sites, an
enforcement discretion policy, the goal of which was to relieve residential owners of the fear that
they might be subject to an enforcement action involving contaminated property, even though
they had not caused the contamination on the property.
Under this policy, residential property is defined as "single family residences of one-to-four
dwelling units..." Further, this policy deems irrelevant a residential owner's knowledge of
contamination. The residential owner policy applies to residents as well as their lessees, so long
as the activities the resident takes on the property are consistent with the policy. The policy also
applies to residential owners who acquire property through purchase, foreclosure, gift,
inheritance, or other form of acquisition, as long as the activities the resident undertakes on the
property after acquisition are consistent with the policy.
Residential property owners who purchase contaminated property after January 1, 2002, may
also take advantage of the statutory BFPP protection. The Brownfields Amendments addressed
residential property owners by clarifying the type of pre-purchase investigation (i.e., AAI) that a
residential property owner must conduct to obtain BFPP status. Specifically, an inspection and
title search that reveal no basis for further investigation will qualify as all appropriate inquiry for
a residential purchaser. CERCLA § 101(40)(B)(iii).
THRESHOLD CRITERIA FOR RESIDENTIAL PROPERTY OWNERS UNDER EPA GUIDANCE
An owner of residential property located on a CERCLA site may be protected from liability if the
owner:
Has not and does not engage in activities that lead to a release or threat of release of
hazardous substances, resulting in EPA taking a response action at the site;
Cooperates fully with EPA by providing access and information when requested and does not
interfere with the activities that either EPA or a state is taking to implement a CERCLA
response action;
Does not improve the property in a manner inconsistent with residential use; and
Complies with institutional controls (e.g., property use restrictions) that may be placed on the
residential property as part of EPA's response action.
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Comfort/status letters provide a prospective purchaser with the information EPA has about a
particular property and EPA's intentions with respect to the property as of the date of the letter.
The "comfort" comes from a greater understanding of what EPA knows about the property and
what its intentions are with respect to any response activities. Comfort/status letters are not "no
action" assurances; that is, they are not assurances by EPA that it will not take an enforcement
action at a particular site in the future.
This Section covers:
Superfund Comfort/Status Letters;
RCRA Comfort/Status Letters;
Bona Fide Prospective Purchaser Reasonable Steps Comfort Letters; and
Comfort Letters for National Priorities List Sites and Federally Owned Properties.
1,
On November 8, 1996, EPA issued its Policy on the Issuance of Comfort/Status Letters. The
letters provide a party with relevant releasable information EPA has pertaining to a particular
piece of property, what that information means, and the status of any ongoing, completed or
planned federal Superfund action at the property. Comfort/status letters may be considered when
they may facilitate the cleanup and redevelopment of brownfields, where there is a realistic
perception or probability of incurring Superfund liability, and where there is no other mechanism
available to adequately address a party's concerns.
The policy lists four types of comfort letters:
No Previous Superfund Interest Letter;
No Current Superfund Interest Letter;
Federal Superfund Interest Letter; and
State Action Letter.
EVALUATION CRITERIA FOR SUPERFUND COMFORT/STATUS LETTERS
EPA may issue a comfort letter upon request if:
The letter may facilitate cleanup and redevelopment of potentially contaminated property;
There is a realistic perception or probability of incurring CERCLA liability; and
There is no other mechanism available to adequately address the party's concerns.
ifc &
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PRIVATE PARTY TOOLS
Various private tools can be used to manage environmental liability risks associated with brownfields
and other properties. These tools may include:
Indemnification Provisions - These are private contractual mechanisms in which one
party promises to cover the costs of liability of another party. Indemnification provisions
provide prospective buyers, lenders, insurers, and developers with a means of assigning
responsibility among themselves for cleanup costs, and encourage negotiations among
private parties without government involvement.
Knvironmental Insurance Policies - The insurance industry offers products intended to
allocate and minimize liability exposures among parties involved in brownfields
redevelopment. These products include cost cap, pollution legal liability, and secured
creditor policies. Insurance products may serve as a tool to manage environmental liability
risks, but, many factors affect their utility including the types of coverage available, the
dollar limits on claims, the policy time limits, site assessment requirements, and the cost of
available products. Parties involved in brownfields redevelopment considering
environmental insurance should always secure the assistance of skilled brokers and lawyers
to help select appropriate coverage.
RCRA treatment, storage, and disposal (TSD) facilities present unique challenges in terms of
cleanup and reuse, but may also provide opportunities for revitalization. Recognizing that
situations often exist at RCRA facilities analogous to Superfund sites, EPA developed guidance
for issuing comfort/status letters for RCRA TSD facilities. Comfort/Status Letters for RCRA
Brown/Held Properties, issued on February 5, 2001, limited the use of such letters to those
situations that could facilitate the cleanup and reuse of brownfields, where there was a realistic
perception or probability of EPA initiating a RCRA cleanup action, and where there was no other
mechanism to adequately address the party's concern.
The proper use of RCRA comfort/status letters was explained further in the April 8, 2003
guidance Prospective Purchaser Agreements and Other Tools to Facilitate Cleanup and Reuse of
RCRA Sites. That guidance highlights RCRA PPAs, and the February 23, 2003 Final Guidance
on Completion of Corrective Action Activities at RCRA Facilities highlights RCRA PPAs as
resource intensive but potentially valuable tools to help revitalize RCRA sites. The guidances
provide examples where RCRA PPAs have been successfully used and identify certain factors
that should be considered before issuing a RCRA PPA.
3. '. ps
EPA has the discretion, in appropriate circumstances, to provide a bona fide prospective
purchaser (BFPP) (see Section III.A.I), contiguous property owner (CPO) (see Section
III.A.2.ii), or innocent landowner (see Section III.A.3.ii) with a comfort/status letter addressing
what "reasonable steps" a landowner could take at a particular site to meet its continuing
obligations with respect to hazardous substances found at the property. In issuing this type of
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letter EPA makes an assessment of the actions proposed by the landowner and, based on site-
specific factors and environmental concerns, determines any potential incompatibilities between
the proposed actions and EPA's response actions. EPA also suggests what steps might be
appropriate for the landowner to take with respect to the planned or completed response action.
This letter does not provide a release from CERCLA liability, but only provides information with
respect to reasonable steps based on the available information and the nature and extent of
contamination known to EPA at the time the letter is issued. If additional information regarding
the nature and extent of hazardous substance contamination at the site becomes available,
additional actions may be necessary to satisfy the reasonable steps requirement.
A sample of this type of letter is included in Attachment C in Appendix A of this handbook,
Interim Guidance Regarding Criteria Landowners Must Meet in Order to Qualify for Bona Fide
Prospective Purchaser, Contiguous Property Owner, or Innocent Landowner Limitations on
CERCLA Liability ("Common Elements ).
4. for
EPA may issue a comfort letter to address various issues concerning perceived National
Priorities List (NPL) stigma and CERCLA liability involved in closing military base property.
In January 1996, EPA updated its Model Comfort Letter Clarifying NPL Listing,
Uncontaminated Parcel Identifications, and CERCLA Liability Issues Involving Transfers of
Federally Owned Property (January 1996). This type of comfort letter may include a
determination that a remedy is operating properly and successfully.
The model letter also describes certain CERCLA provisions a federal agency must comply with
before transferring any property on which hazardous substances have been stored for a year or
more, or are known to have been released or disposed of. The letter may include:
Information regarding the hazardous substances;
A covenant that all remedial action necessary to protect human health and the
environment with respect to any hazardous substances remaining on the property has
been taken before the date of transfer; and
A covenant stating that the United States will conduct any additional remedial actions
found necessary after the date of transfer.
Information about EPA's efforts to clean up, transfer, and reuse federal facilities, and the Model
Comfort Letter Clarifying NPL Listing, Uncontaminated Parcel Identifications, and CERCLA
Liability Issues Involving Transfers of Federally Owned Property (January 1996) are available at
http://www.epa.gov/fedfac/.
24
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B.
EPA has long recognized the value of redeveloping contaminated land and the importance of
helping address reasonable liability concerns to encourage prospective purchasers of such land.
This Section covers:
Bona Fide Prospective Purchaser Work Agreements;
Prospective Purchaser Agreements and Prospective Lease Agreements;
Windfall Lien Resolutions; and
Contiguous Property Owner Assurance Letters and Settlements.
1.
As discussed in Section III.A.I, a bona fide prospective purchaser (BFPP) may purchase
property with knowledge of the contamination. Although the activities of most BFPPs will not
require liability protection beyond what is provided by the self-implementing BFPP provision, if
a BFPP wants to perform cleanup work at a contaminated site of federal interest that exceed the
BFPP reasonable steps requirement, a work agreement may be used to address potential liability
concerns.
As a result of this need and to further encourage reuse and redevelopment of contaminated sites,
EPA and DOJ jointly issued a model administrative order titled Issuance of CERCLA Model
Agreement and Order on Consent for Removal Action by a Bona Fide Prospective Purchaser
(November 2006), for use as an agreement with a BFPP who intends to perform removal work at
its property beyond reasonable steps. The purpose of the model is to promote land reuse and
revitalization by addressing liability concerns associated with acquisition of contaminated
property. In particular, the removal work to be performed under the model must be of greater
scope and magnitude than the "reasonable steps" with respect to the hazardous substances at the
property that must be performed by BFPPs if they are to maintain their protected status under the
statute.
The model provides a covenant not to sue for "existing contamination" and requires the person
performing the removal work to reimburse EPA's oversight costs. Contribution protection and a
release and waiver of any windfall lien are also provided.
The model is for use at sites of federal interest where the work is more significant and complex
than what is generally required as "reasonable steps" with respect to the hazardous substances at
the property.
2. a
Long before the BFPP liability protection was available, EPA entered into prospective purchaser
agreements (PPAs) and prospective lease agreements (PLAs). PPAs and PLAs are agreements
between a liable party and EPA whereby EPA provides the party with liability relief in exchange
for payment and/or cleanup work. PPAs and PLAs are available for CERCLA and RCRA sites.
2S
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Between 1989 and 2001, EPA published the following policies that addressed PPAs and PLAs:
Guidance on Landowner Liability under Section 107(a)(l) of CERCLA, De Minimis
Settlements under Section 122(g)(l)(B) of CERCLA, and Settlements with Prospective
Purchasers of Contaminated Property (June 6, 1989). Models attached to the 1989
guidance were for settlements with de minimis landowners under § 122(g)(l)(B).
Guidance on Agreements with Prospective Purchasers of Contaminated Property (May
24, 1995).
Expediting Requests for Prospective Purchaser Agreements (October 1, 1999).
Support of Regional Efforts to Negotiate Prospective Purchaser Agreements (PPAs) at
Super fund Sites and Clarification ofPPA Guidance (January 10, 2001).
Memorandum on Prospective Purchaser Agreements and Other Tools to Facilitate
Cleanup and Reuse ofRCRA Sites (April 8, 2003).
DIFFERENCES BETWEEN BFPP LIABILITY PROTECTION AND PPAs
BFPP PPAs
Method of ,,,_ . . AT . . JA A i
. Self-Implementing Negotiation and EPA Approval
Execution ^ ° ° ^
Timing Obtained when purchaser After federal government
meets threshold and approves PPA terms
maintains statutory
requirements
Transaction Costs Lower transaction costs and Higher transaction cost
some continuing obligations
After the enactment of the Brownfields Amendments, EPA issued a policy on May 31, 2002,
Bona Fide Prospective Purchasers and the New Amendments to CERCLA., which discusses the
interplay between the legislatively created BFPP and EPA's use of PPAs. In that policy, EPA
stated that in most circumstances, where a party meets the BFPP requirements, PPAs will no
longer be needed to enjoy liability relief under CERCLA as a present owner. There are, however,
limited circumstances under which EPA will continue to consider entering into a PPA, such as
when:
Significant environmental benefits will be derived from the project in terms of cleanup;
The facility is currently involved in CERCLA litigation such that there is a very real
possibility that a party who buys the facility would be sued by a third party; and
There are unique, site-specific circumstances not otherwise addressed, and the PPA will
serve a significant public interest.
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In special circumstances, the assurances to BFPPs provided by the above-referenced guidance
documents may be supplemented for cleanup work performed by BFPPs under EPA supervision.
A Bona Fide Prospective Purchaser Work Agreement may be an available tool. See Section
IV.B. 1 for more information about Bona Fide Prospective Purchaser Work Agreements.
3, V-in in I-'.'In. till III in in ii: ^solution
In the Interim Enforcement Discretion Policy Concerning "Windfall Liens" Under Section
107(r) ofCERCLA (July 16, 2003), EPA anticipates that there may be situations where a site has
a windfall lien (for more on windfall liens, see Section III.A.I) and a bona fide prospective
purchaser wants to satisfy any existing or potential windfall lien before or close to the time of
acquisition. Congress specifically provided EPA with the authority to resolve windfall lien
exposure in CERCLA § 107(r)(2). EPA and DOJ have developed a model document to facilitate
resolution of windfall liens as an attachment to the windfall liens guidance.
More information on windfall lien resolution and the model document for such a resolution is
available in the Interim Enforcement Discretion Policy Concerning "Windfall Liens" Under
Section 107(r) ofCERCLA (July 16, 2003) at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/interim-windfall-lien.pdf
4, 'i itiguous Property Owner Assuran- , III
The Brownfields Amendments provide CERCLA liability protections for contiguous property
owners (CPOs). Some landowners continue to have liability concerns, however, especially where
EPA has conducted a response action on the neighboring contaminated property or the CPO's
property. In such cases, EPA has the discretion to offer assurance that no enforcement action will
be brought against a CPO for contamination resulting from a neighbor's actions, or to enter into
a settlement agreement with the CPO, providing the CPO with cost recovery or contribution
protection from potentially responsible parties at the site.
Guidance on the appropriateness of an assurance letter or an agreement is found in EPA's
Interim Enforcement Discretion Guidance Regarding Contiguous Property Owners (January 13,
2004) at http://www.epa.gov/compliance/resources/policies/cleanup/superfund/contig-prop.pdf.
EPA also issued a Model CERCLA Section 107(q)(3) Contiguous Property Owner Assurance
Letter (November 11, 2009) available at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/cpo-assure-mod-ltr.pdf
- ""-"I" I "ill enen|";
This Section covers:
Ready for Reuse Determinations and
National Priorities List Deletion.
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1. for
When all or a portion of a Superfund site is protective for specified uses, EPA has the discretion
to issue a Ready for Reuse (RfR) determination. RfR determinations are intended to facilitate
reuse and provide helpful information to the real estate marketplace about the environmental
status of the Superfund site.
RfR determinations are technical rather than legal and explain the nature and extent of
contamination. Before EPA created the RfR determination, potential users often had to seek out
information about a site's environmental condition from many different sources, and the
information that was available was often expressed in terms difficult for the marketplace to inter-
pret. This meant that many sites able to accommodate certain types of uses were needlessly
difficult to market. With the creation of the RfR determination, potential users and the real estate
marketplace will have an affirmative statement written in plain English, and accompanied by
supporting decision documentation, that a site identified as ready for reuse will remain protective
of the remedy as long as all required response conditions and use limitations identified in the
site's response decision documents and land title documents continue to be met.
For more information on RfR determinations, please refer to
http://www.epa.gov/superfund/programs/recycle/tools/rfr.html. Additionally, EPA drafted
Guidance for Preparing Superfund Ready for Reuse Determinations (February 12, 2004), which
is available at www.epa.gov/superfund/programs/recvcle/pdf/rfrguidance.pdf.
2.
Under certain conditions, EPA may delete or recategorize a property or portion of a property
from the National Priorities List (NPL). States play a key role in NPL deletions. Before
developing a notice of intent to delete, EPA must consult with the state. In consultation with the
state, EPA must consider:
Whether responsible parties or other parties have taken all appropriate response actions
that are required;
Whether no further response actions are required; and
Whether the remedial investigation has shown that the release poses no significant threat
to public health or the environment and taking of remedial measures is therefore not
appropriate.
Sites may not be deleted from the NPL without state concurrence and publication of a proposed
deletion in the Federal Register. It is important to note that deletion or partial deletion of a site
from the NPL does not itself create, alter, or remove any legal rights or obligations. More
information on NPL deletion is available on the EPA website at
http://www.epa.gov/superfund/sites/npl/index.htm.
2S
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The success of the Brownfields program in responding to and even bolstering market demand for
properties with known or suspected contamination has led to increased demand for contaminated
properties that are cleaned up under the other EPA programs. The demand for, and use of, such
sites includes those properties where some contamination remains, but is controlled on site.
Therefore long-term stewardship activities are needed to ensure the continued protection of the
remedy and human health and the environment.
Long-term stewardship generally refers to the activities and processes used to control and
manage residual contamination, limit inappropriate exposures, control land and resource uses,
and ensure the continued protectiveness of "engineered" controls and "institutional" controls at
sites. Long-term stewardship also takes on greater importance with the increased demand for the
reuse of properties, especially properties where cleanup does not result in unrestricted uses or
unlimited exposures.
Physical or "engineered" controls are the engineered physical barriers or structures designed to
monitor and prevent or limit exposure to the contamination. Certain engineered cleanups will
involve ongoing operation and maintenance (O&M), monitoring, evaluation, periodic repairs,
and sometimes replacement of remedy components.
EXAMPLES OF ENGINEERED CONTROLS
Landfill soil caps
Impermeable liners
Other containment covers
Underground slurry walls
Fences
Bioremediation
Ground water pump-and-treat and monitoring
systems
Legal or "institutional" controls are non-engineered instruments, such as administrative and/or
legal mechanisms, intended to minimize the potential for human exposure to contamination by
limiting land or resource use. Institutional controls may be used to supplement engineering
controls and also must be implemented, monitored, and evaluated for effectiveness as long as the
risks at a site are present. Institutional controls may also include informational devices, such as
signs, state registries, and deed notices. In February 2005, to further explain the requirements of
institutional controls, EPA published a guidance document titled Institutional Controls: A
Citizen's Guide to Understanding Institutional Controls at Superfund, Brownfields, Federal
Facilities, Underground Storage Tanks, and Re source Conservation and Recovery Act Cleanups.
EPA has also developed two cross-program guidances addressing the entire lifecycle of
institutional controls, from evaluation to implementation and enforcement. These and other
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institutional controls guidance are available on the EPA institutional controls webpage at
http://www.epa.gov/superfund/policy/ic/index.htm.
EXAMPLES OF INSTITUTIONAL CONTROLS
Government Controls ~ Permits, Zoning
Informational Devices ~ Notices, Advisories, Warnings
Proprietary Controls ~ Easements, Restrictive Covenants
Enforcement Mechanisms ~ Administrative Orders, Cleanup Agreements
EPA, the states, and local governments have increased their knowledge about the long-term
requirements needed to reuse and revitalize contaminated sites. The cleanup remedies for
contaminated sites and properties often require the management and oversight of on-site waste
materials and contaminated environmental media for long periods of time. EPA and its
regulatory partners implement (or ensure that responsible parties implement) long-term
stewardship after construction of the remedy for site cleanup and for as long as wastes are
controlled on site. Long-term stewardship can last many years, decades, or in some cases, even
longer. Long-term stewardship involves ongoing coordination and communication among nu-
merous stakeholders, each with different responsibilities, capabilities, and information needs.
Even though the various cleanup programs have different authorities, there are common elements
to address the long-term stewardship efforts. For example, under Superfund, long-term
stewardship activities are performed as part of the O&M of a remedy. Responsibility for O&M is
contingent upon whether the cleanup was conducted by a potentially responsible party (PRP),
including federal facilities, or whether EPA funded the cleanup. Under the RCRA program,
cleanups are conducted in connection with the closure of regulated units and in facility-wide
corrective action under either a permit, imminent hazard, or other order or agreement.
Under the brownfields program, EPA provides cleanup grants to state and local governments and
non-profit organizations to carry out cleanup activities, including monitoring and enforcement of
institutional controls.
Pursuant to the underground storage tanks (UST) program requirements, when a release has been
detected or discovered at a UST, the UST owner/operator must perform corrective action to
clean up any contamination caused by the release. Under cooperative agreements between EPA
and the states, states are largely responsible for overseeing corrective actions in connection with
USTs, including long-term stewardship. EPA is generally responsible for overseeing the
corrective actions, including long-term stewardship activities on tribal lands.
More information on long-term stewardship is available on EPA's Land Revitalization website at
http://www.epa.gov/oswer/landrevitalization/download/lts report sept2005 .pdf
In certain circumstances, supplemental environmental projects (SEPs) may play a role in
revitalizing contaminated sites. SEPs are not developed, funded, or managed by EPA. Rather,
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they are environmentally beneficial projects undertaken by a defendant or respondent in
settlement of an environmental enforcement action. SEPs are activities that go beyond what is
required for compliance, and that the violator is not otherwise legally required to perform.
EPA's 1998 SEP Policy describes when and how an SEP may be included as part of an
enforcement settlement. Although not appropriate for every enforcement settlement, where a
violator is willing and the conditions of the SEP Policy are met, SEPs may help address
environmental concerns related to the violations at issue in the enforcement action.
As stated in the November 2006 Brownfield Sites and Supplemental Environmental Projects
(SEPs) fact sheet, SEPs that require assessment and/or cleanup of brownfield sites cannot be
included in settlements because appropriations law prohibits the Agency from including SEPs to
perform activities that Congress has already funded through EPA. Congress provides funds for
assessment and cleanup activities to EPA's brownfields program. In an appropriate enforcement
settlement, however, and as long as all the other requirements of the SEP Policy are met, SEPs
that complement brownfield site assessment or cleanup activities may be included in settlement.
Examples of such SEPs are green building projects, projects that call for the violator to provide
energy-efficient building materials to a redeveloper, urban forest projects, and stream restoration
projects. To learn more about the general requirements for a SEP, please refer to EPA
Supplemental Environmental Projects Policy (SEP Policy) (May 1, 1998).
c.
OECA is guided in the development of policy documents not only by enforcement principles
such as "polluter pays" and "enforcement first," but also by broader principles that have been
established to carry out EPA's mission.
This Section covers:
Environmental Justice;
Public Participation; and
Financial Assurance.
1.
EPA recognizes that minority and/or low-income communities may be disproportionately
exposed to environmental harms and risks. As a result, EPA works to protect these and other
communities burdened by adverse human health and environmental effects and has incorporated
environmental justice as a priority throughout EPA. Accordingly, EPA maintains its ongoing
commitment to the fair treatment and meaningful involvement of all people regardless of race,
color, national origin, or income with respect to the development, implementation, and
enforcement of environmental laws, regulations, and policies. More information about EPA's
environmental justice program as it relates to Superfund can be found at
http://www.epa.gov/oswer/ei/index.html.
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ENVIRONMENTAL JUSTICE
Environmental justice includes the fair treatment and meaningful involvement of all people
regardless of race, color, national origin, or income with respect to the development,
implementation, and enforcement of environmental laws, regulations, and policies.
What is meant by fair treatment and meaningful involvement?
"Fair treatment" means that no group of people should bear a disproportionate share of
the negative environmental consequences resulting from industrial, governmental, and
commercial operations or policies.
"Meaningful involvement" means that:
1. People have an opportunity to participate in decisions about activities that may
affect their environment and/or health;
2. The public's contribution can influence the regulatory agency's decision;
3. Their concerns will be considered in the decision-making process; and
4. Decision makers seek out and facilitate the involvement of those potentially
affected.
EPA is committed to improving environmental performance through compliance with
environmental requirements, preventing pollution, promoting environmental stewardship, and
incorporating environmental justice across the spectrum of our programs, policies, and activities.
When working with local environmental justice communities, EPA encourages parties to:
Meaningfully involve the community in the planning, cleanup, and revitalization process;
Review the cumulative effects of multiple sources of contamination in close proximity to
one another;
Ensure an equitable distribution of brownfields assistance to environmental justice
communities;
Adhere to community commitments made in brownfields grant proposals;
Assist environmental justice communities in obtaining independent technical advisors to
help communities navigate the brownfields cleanup and redevelopment process;
Provide equal opportunity for local minority-owned businesses specializing in
environmental assessment and cleanup work to compete for contracts needed to plan,
clean up, and revitalize brownfields; and
Take steps to limit the displacement, equity loss, and cultural loss of the local
community.
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1C
Citizens are an essential component of the Superfund cleanup and RCRA permitting processes
and the revitalization of these sites and brownfields sites. Formal public participation activities,
required by law or regulation, are designed to provide citizens with both access to information
and opportunities to participate in the cleanup process. EPA uses the term "public participation"
to denote activities that:
Encourage public input and feedback;
Encourage a dialogue with the public;
Provide access to decision makers;
Assimilate public viewpoints and preferences; and
Demonstrate that those viewpoints and preferences have been considered by the decision
makers.
I COMMUNITY ENGAGEMENT INITIATIVE: PUBLIC PARTICIPATION
IN THE CLEANUP PROCESS
EPA benefits from active participation of the public. Effectively engaging communities means
EPA will need to make information easy to understand; find diverse ways to reach the public
(both electronically and via traditional means); find creative ways to hear their needs and
suggestions; and work with partners, stakeholders, and other federal agencies to make informed
decisions and find the best solutions. Against this broad spectrum of activities, certain guiding
principles provide consistency in developing a more robust community engagement process.
EPA's guiding principles are to:
Proactively include community stakeholders in the decision-making process;
Make decision-making processes transparent, accessible, and understandable;
Include a diversity of stakeholders;
Explain government roles and responsibilities; and
Ensure consistent participation by responsible parties.
In the revitalization context, working with a variety of community members, local planners, and
elected officials is an effective way to identify and integrate long-term community needs into
reuse plans for the site. Redevelopment planning enables citizens to realize their vision for the
future reuse of the site. This process should encourage participation of all community members
in goal development, action planning, and implementation. By considering a community's vision
of future land uses for contaminated sites, EPA often can tailor cleanup options to accommodate
community goals.
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While successful redevelopment planning can occur at any stage of a cleanup, redevelopment
planning should begin as early as possible in the remedial process. The planning process can last
several days or months depending on the issues facing the community. It is vital to help
communities think of long-term strategies for sustainable future land use, and EPA should begin
the public participation process in the earliest stages of redevelopment.
3.
Financial assurance requirements are implemented under Superfund and RCRA to ensure that
adequate funds are available to address closure and cleanup of facilities or sites that handle
hazardous materials.
Financial assurance requirements play an important role in promoting the revitalization of
contaminated sites. Where financial resources are available for cleanup or closure activities,
entities interested in reusing or redeveloping the property are not confronted with the question of
where to obtain the resources for cleaning up the property. When there are inadequate financial
assurance funds, EPA or the states may have to spend taxpayer money to fund cleanups. This not
only shifts the responsibility away from the liable party, it may also result in a significant delay
in closure or cleanup activities. While the property awaits the performance of closure or cleanup
activities, it is often difficult to attract outside parties to the property for further reuse and
redevelopment.
EPA optimizes financial safeguards through compliance assistance, compliance monitoring, and
enforcement. OECA has developed tools, guidance, and training to assist the regions and states
in these areas, which are available on EPA's website at
http://www.epa.gov/epawaste/hazard/tsd/td/ldu/fmancial/index.htm.
.id
OSRE has worked closely with other EPA offices including the Office of Brownfields and Land
Revitalization (OBLR), the Office of Site Remediation and Technology Innovation (OSRTI),
and the Office of Solid Waste (OSW), all within the Office of Solid Waste and Emergency
Response (OSWER), to develop and launch new initiatives or programs to address certain
revitalization challenges.
This Section covers:
The Environmentally Responsible Redevelopment and Reuse Initiative;
Brownfields Grants and State/Tribal Funding;
The Superfund Redevelopment Initiative;
The RCRA Brownfields Initiative; and
RE-Powering America's Land Initiative.
34
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1, "
In 2004, OSRE launched the Environmentally Responsible Redevelopment and Reuse (ER3)
Initiative as a tool using established liability relief principles and other Agency-wide incentives
to promote the sustainable cleanup and redevelopment of contaminated sites. Sustainable
development, including the redevelopment of formerly contaminated sites, is a multi-faceted,
long-term approach that balances environmental cleanup and protection with economically sound
development practices and the promotion of social equity.
The cleanup and redevelopment of contaminated sites produces significant environmental
benefits and in most cases is preferable to a property remaining underutilized or idle. Current
development practices, however, can also have significant environmental impacts, such as
excessive use of scarce natural resources, energy consumption, wildlife habitat destruction, and
storm water runoff. Sustainable development not only counters these negative trends, but in
some cases can actually enhance the environment. Sustainable development reflects the synergy
between the business of development and the environment rather than the trade-off between
them.
The ER3 program builds on EPA's efforts to use redevelopment and revitalization of
contaminated sites as an effective tool to spur cleanups that otherwise may not occur. By
promoting and facilitating environmentally responsible redevelopment at formerly contaminated
sites, the goal of ER3 is to establish the next generation of environmental protection - one that
proactively prevents and/or reduces contamination in the developed environment without
sacrificing profitability for developers.
For information on ER3 pilot projects, see EPA's website at
http://www.epa.gov/compliance/cleanup/revitalization/er3/.
2, ',,i -I I MI,
The 2002 Brownfield Amendments established a competitive grant program for the assessment
and cleanup of brownfield sites, along with environmental job training under CERCLA § 104(k).
OBLR administers this program, often with OECA's assistance. Regarding site cleanup, the
brownfield grant program provides direct funding for brownfields assessment, cleanup, and
revolving loans (establishment of a revolving loan fund for eligible entities to make loans to be
used for cleanup), which helps communities revitalize blighted sites by allowing them to take
what is often the first step in the process addressing potential contamination. To be eligible for
a brownfield grant, an entity must be an eligible entity and must plan to use the grant funding at
an eligible "brownfield site." CERCLA §§ 104(k)(l), 104(k)(3), and 101(39). The 2002
Brownfields Amendments define a brownfield site broadly, but exclude certain sites from
funding eligibility. Certain sites are excluded based on their regulatory or ownership status.
CERCLA § 104(k)(4)(B) imposes certain other restrictions on the use of brownfield grant
funding, such as the prohibition on the use of funds to pay response costs at a site at which a
recipient of the federal grant funds would be considered liable as a PRP.
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Because state and tribal response programs play a significant role in cleaning up brownfields, the
Brownfields Amendments also authorized EPA to provide assistance to states and tribes to
establish or enhance their response programs. CERCLA § 128(a).
OFFICE OF BROWNFIELDS AND LAND REVITALIZATION
GRANTS AND FUNDING WEB ACCESS
For information on the EPA brownfields grant program, please refer to:
http://www.epa.gov/brownfields
EPA's Superfund Redevelopment Initiative (SRI) helps communities return some of the nation's
worst hazardous waste sites to safe and productive use. While cleaning up these Superfund sites
and making them protective of human health and the environment, EPA is working with
communities and other partners in considering future use opportunities and integrating
appropriate reuse options into the cleanup process.
EPA's goal is to make sure that at every cleanup site, EPA and its partners have an effective
process and the necessary tools and information to fully explore future uses before the cleanup
remedy is implemented. This gives EPA the best chance of making its remedies consistent with
the likely future use of a site. In turn, EPA gives communities the best opportunity to use sites
productively following cleanup.
More information on SRI is available at
http://www.epa.gov/superfund/programs/recycle/index.html.
A potential RCRA brownfield is a RCRA facility that is not in full use, where there is
redevelopment potential, and where reuse or redevelopment of that site is slowed due to real or
perceived concerns about actual or potential contamination, liability, and RCRA requirements.
The RCRA Brownfields Prevention Initiative was established by EPA to encourage the reuse of
potential RCRA brownfields so that the land better serves the needs of the community, either
through more productive commercial or residential development or as greenspace.
More information on the RCRA Brownfields Prevention Initiative is available on EPA's website
at http://www.epa.gov/epawaste/hazard/correctiveaction/bfields.htm.
The initiative links EPA's brownfields program with EPA's RCRA corrective action program
and other EPA cleanup programs as well as with state cleanup programs to help communities
address contaminated and often blighted properties that may stand in the way of economic
vitality. The initiative includes:
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Showcasing cleanup and revitalization approaches through RCRA brownfields
prevention pilot projects;
Addressing barriers to cleanup and revitalization with targeted site efforts (TSEs);
Supporting outreach efforts of EPA regional offices, states, and the RCRA community
through conferences, training, Internet seminars, and the RCRA brownfields web page;
and
Identifying policies that inadvertently may be hindering cleanup and addressing them
with guidance and technical assistance or through other means.
EPA's RE-Powering America's Land Initiative encourages renewable energy development on
current and formerly contaminated land and mine sites. This initiative identifies the renewable
energy potential of these sites and provides a variety of resources for communities, developers,
industry, state and local governments, or any other party interested in reusing contaminated or
formerly contaminated land for renewable energy development.
More information on EPA's RE-Powering America's Land Initiative is available at
http://www.epa.gov/renewableenergyland/.
37
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APPENDICES
Appendix A Common Elements Guidance, March 6, 2003
Appendix B Top 10 Questions to Ask Before Buying a Superfund Site
Appendix C CERCLA Liability and Local Government Acquisitions and Other Activities
Appendix D Brownfields Enforcement and Land Revitalization Policy and Guidance
Documents
Appendix E Contact Information
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Common Elements Guidance
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a
V
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
MAR - 6 2003
OFFICE OF
ENFORCEMENT AND
COMPLIANCE ASSURANCE
MEMORANDUM
SUBJECT:
FROM:
TO:
Interim Guidance Regarding Criteria Landowners Must Meet in Order to Qualify
for Bona Fide Prospective Purchaser, Contiguous Property Owner, or Innocent
Landowner Limitations on CERCLA^iabilitiL^GeFmmon Elements")
' "k^s^ N^
Susan E. Bromm, Director^l^ $^
Office of Site Remediation Enforcement
Director, Office of Site Remediation and Restoration, Region I
Director, Emergency and Remedial Response Division, Region II
Director, Hazardous Site Cleanup Division, Region HI
Director, Waste Management Division, Region IV
Directors, Superfund Division, Regions V, VI, VII and DC
Assistant Regional Administrator, Office of Ecosystems Protection and
Remediation, Region VIII
Director, Office of Environmental Cleanup, Region X
Director, Office of Environmental Stewardship, Region I
Director, Environmental Accountability Division, Region IV
Regional Counsel, Regions II, IE, V, VI, VH, K, and X
Assistant Regional Administrator, Office of Enforcement, Compliance, and
Environmental Justice, Region VIE
I.
Introduction
The Small Business Liability Relief and Brownfields Revitalization Act, ("Brownfields
Amendments"), Pub. L. No. 107-118, enacted in January 2002, amended the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), to provide important
liability limitations for landowners that qualify as: (1) bona fide prospective purchasers, (2)
contiguous property owners, or (3) innocent landowners (hereinafter, "landowner liability
protections" or "landowner provisions").
Recycled/Recyclable . Printed with Vegetable Oil Based Inks on 100% Recycled Paper (40% Postconsumer)
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To meet the statutory criteria for a landowner liability protection, a landowner must meet
certain threshold criteria and satisfy certain continuing obligations.1 Many of the conditions are
the same or similar under the three landowner provisions ("common elements"). This
memorandum is intended to provide Environmental Protection Agency personnel with some
general guidance on the common elements of the landowner liability protections. Specifically,
this memorandum first discusses the threshold criteria of performing "all appropriate inquiry"
and demonstrating no "affiliation" with a liable party. The memorandum then discusses the
continuing obligations:
compliance with land use restrictions and not impeding the effectiveness or integrity
of institutional controls;
taking "reasonable steps" with respect to hazardous substances affecting a
landowner's property;
providing cooperation, assistance and access;
complying with information requests and administrative subpoenas; and
providing legally required notices.
A chart summarizing the common elements applicable to bona fide prospective purchasers,
contiguous property owners, and innocent landowners is attached to this memorandum
(Attachment A). In addition, two documents relating to reasonable steps are attached to this
memorandum: (1) a "Questions and Answers" document (Attachment B); and (2) a sample site-
specific Comfort/Status Letter (Attachment C).
This memorandum addresses only some of the criteria a landowner must meet in order to
qualify under the statute as a bona fide prospective purchaser, contiguous property owner, or
innocent landowner (i.e., the common elements described above). Other criteria (e.g., the
criterion that a contiguous property owner "did not cause, contribute, or consent to the release or
threatened release," found in CERCLA § 107(q)(l)(A)(i), and the criterion that a bona fide
prospective purchaser and innocent landowner purchase the property after all disposal of
hazardous substances at the facility, found in CERCLA §§ 101(40)(A), 101(35)(A)), are not
addressed in this memorandum. In addition, this guidance does not address obligations
landowners may have under state statutory or common law.
This memorandum is an interim guidance issued in the exercise of EPA's enforcement
discretion. As EPA gains more experience implementing the Brownfields Amendments, the
Agency may revise this guidance. EPA welcomes comments on this guidance and its
implementation. Comments may be submitted to the contacts identified at the end of this
memorandum.
1 See CERCLA §§ 101(40)(B)-(H), 107(q)(lXA), 101(35)(A)-(B).
2
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II. Background
The bona fide prospective purchaser provision, CERCLA § 107(r), provides a new
landowner liability protection and limits EPA's recourse for unrecovered response costs to a lien
on property for the increase in fair market value attributable to EPA's response action. To
qualify as a bona fide prospective purchaser, a person must meet the criteria set forth in
CERCLA § 101(40), many of which are discussed in this memorandum. A purchaser of
property must buy the property after January 11, 2002 (the date of enactment of the Brownfields
Amendments), in order to qualify as a bona fide prospective purchaser. These parties may
purchase property with knowledge of contamination after performing all appropriate inquiry, and
still qualify for the landowner liability protection, provided they meet the other criteria set forth
in CERCLA § 101(40).2
The new contiguous property owner provision, CERCLA § 107(q), excludes from the
definition of "owner" or "operator" a person who owns property that is "contiguous" or
otherwise similarly situated to, a facility that is the only source of contamination found on his
property. To qualify as a contiguous property owner, a landowner must meet the criteria set
forth in CERCLA § 107(q)(l)(A), many of which are common elements. This landowner
provision "protects parties that are essentially victims of pollution incidents caused by their
neighbor's actions." S. Rep. No. 107-2, at 10 (2001). Contiguous property owners must perform
all appropriate inquiry prior to purchasing property. Persons who know, or have reason to know,
prior to purchase, that the property is or could be contaminated, cannot qualify for the
contiguous property owner liability protection.3
The Brownfields Amendments also clarified the CERCLA § 107(b)(3) innocent
landowner affirmative defense. To qualify as an innocent landowner, a person must meet the
criteria set forth in section 107(b)(3) and section 101(35). Many of the criteria in section
101(35) are common elements. CERCLA § 101(35)(A) distinguishes between three types of
innocent landowners. Section 101(35)(A)(i) recognizes purchasers who acquire property
without knowledge of the contamination. Section 101(35)(A)(ii) discusses governments
acquiring contaminated property by escheat, other involuntary transfers or acquisitions, or the
exercise of eminent domain authority by purchase or condemnation. Section 101(35)(A)(iii)
covers inheritors of contaminated property. For purposes of this guidance, the term "innocent
landowner" refers only to the unknowing purchasers as defined in section 101(35)(A)(i). Like
2 For a discussion of when EPA will consider providing a prospective purchaser with a
covenant not to sue in light of the Brownfields Amendments, see "Bona Fide Prospective Purchasers and
the New Amendments to CERCLA," B. Breen (May 31, 2001).
3 CERCLA § 107(q)(l)(C) provides that a person who does not qualify as a contiguous
property owner because he had, or had reason to have, knowledge that the property was or could be
contaminated when he bought the property, may still qualify for a landowner liability protection as a bona
fide prospective purchaser, as long as he meets the criteria set forth in CERCLA § 101(40).
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contiguous property owners, persons desiring to qualify as innocent landowners must perform all
appropriate inquiry prior to purchase and cannot know, or have reason to know, of contamination
in order to have a viable defense as an innocent landowner.
III. Discussion
A party claiming to be a bona fide prospective purchaser, contiguous property owner, or
section 101(35)(A)(i) innocent landowner bears the burden of proving that it meets the
conditions of the applicable landowner liability protection.4 Ultimately, courts will determine
whether landowners in specific cases have met the conditions of the landowner liability
protections and may provide interpretations of the statutory conditions. EPA offers some general
guidance below regarding the common elements. This guidance is intended to be used by
Agency personnel in exercising enforcement discretion. Evaluating whether a party meets these
conditions will require careful, fact-specific analysis.
A. Threshold Criteria
To qualify as a bona fide prospective purchaser, contiguous property owner, or innocent
landowner, a person must perform "all appropriate inquiry" before acquiring the property. Bona
fide prospective purchasers and contiguous property owners must, in addition, demonstrate that
they are not potentially liable or "affiliated" with any other person that is potentially liable for
response costs at the property.
1. All Appropriate Inquiry
To meet the statutory criteria of a bona fide prospective purchaser, contiguous property
owner, or innocent landowner, a person must perform "all appropriate inquiry" into the previous
ownership and uses of property before acquisition of the property. CERCLA §§ 101(40)(B),
107(q)(l)(A)(viii), 101(35)(A)(i),(B)(i). Purchasers of property wishing to avail themselves of a
landowner liability protection cannot perform all appropriate inquiry after purchasing
contaminated property. As discussed above, bona fide prospective purchasers may acquire
property with knowledge of contamination, after performing all appropriate inquiry, and
maintain their protection from liability. In contrast, knowledge, or reason to know, of
contamination prior to purchase defeats the contiguous property owner liability protection and
the innocent landowner liability protection.
The Brownfields Amendments specify the all appropriate inquiry standard to be applied.
The Brownfields Amendments state that purchasers of property before May 31, 1997 shall take
into account such things as commonly known information about the property, the value of the
property if clean, the ability of the defendant to detect contamination, and other similar criteria.
CERCLA § 101(35)(B)(iv)(I). For property purchased on or after May 31, 1997, the procedures
4 CERCLA §§ 101(40), 107(q)(l)(B), 101(35).
4
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of the American Society for Testing and Materials ("ASTM"), including the document known as
Standard El527 - 97, entitled "Standard Practice for Environmental Site Assessments: Phase 1
Environmental Site Assessment Process," are to be used. CERCLA § 101(35)(B)(iv)(II). The
Brownfields Amendments require EPA, not later than January 2004, to promulgate a regulation
containing standards and practices for all appropriate inquiry and set out criteria that must be
addressed in EPA's regulation. CERCLA § 101(35)(B)(ii), (iii). The all appropriate inquiry
standard will thus be the subject of future EPA regulation and guidance.
2. Affiliation
To meet the statutory criteria of a bona fide prospective purchaser or contiguous property
owner, a party must not be potentially liable or affiliated with any other person who is
potentially liable for response costs.5 Neither the bona fide prospective purchaser/contiguous
property owner provisions nor the legislative history define the phrase "affiliated with," but on
its face the phrase has a broad definition, covering direct and indirect familial relationships, as
well as many contractual, corporate, and financial relationships. It appears that Congress
intended the affiliation language to prevent a potentially responsible party from contracting away
its CERCLA liability through a transaction to a family member or related corporate entity. EPA
recognizes that the potential breadth of the term "affiliation" could be taken to an extreme, and
in exercising its enforcement discretion, EPA intends to be guided by Congress' intent of
preventing transactions structured to avoid liability.
The innocent landowner provision does not contain this "affiliation" language. In order
5 The bona fide prospective purchaser provision provides, in pertinent part:
No AFFILIATIONThe person is not(i) potentially liable, or affiliated with any other
person that is potentially liable, for response costs at a facility through (I) any direct or
indirect familial relationship; or (II) any contractual, corporate, or financial relationship
(other than a contractual, corporate, or financial relationship that is created by the
instruments by which title to the facility is conveyed or financed or by a contract for the
sale of goods or services); or (ii) the result of a reorganization of a business entity that
was potentially liable. CERCLA § 101(40)(H).
The contiguous property owner provision provides, in pertinent part:
NOT CONSIDERED TO BE AN OWNER OR OPERATOR . . . (ii) the person is not (I)
potentially liable, or affiliated with any other person that is potentially liable, for response
costs at a facility through any direct or indirect familial relationship or any contractual,
corporate, or financial relationship (other than a contractual, corporate, or financial
relationship that is created by a contract for the sale of goods or services); or (II) the
result of a reorganization of a business entity that was potentially liablef.] CERCLA §
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to meet the statutory criteria of the innocent landowner liability protection, however, a person
must establish by a preponderance of the evidence that the act or omission that caused the release
or threat of release of hazardous substances and the resulting damages were caused by a third
party with whom the person does not have an employment, agency, or contractual relationship.
Contractual relationship is defined in section 101(35)(A).
B. Continuing Obligations
Several of the conditions a landowner must meet in order to achieve and maintain a
landowner liability protection are continuing obligations. This section discusses those
continuing obligations: (1) complying with land use restrictions and institutional controls; (2)
taking reasonable steps with respect to hazardous substance releases; (3) providing full
cooperation, assistance, and access to persons that are authorized to conduct response actions or
natural resource restoration; (4) complying with information requests and administrative
subpoenas; and (5) providing legally required notices.
1. Land Use Restrictions and Institutional Controls
The bona fide prospective purchaser, contiguous property owner, and innocent landowner
provisions all require compliance with the following ongoing obligations as a condition for
maintaining a landowner liability protection:
- the person is in compliance with any land use restrictions established or relied on
in connection with the response action and
- the person does not impede the effectiveness or integrity of any institutional
control employed in connection with a response action.
CERCLA§§ 101(40)(F), 107(q)(l)(A)(V), 101(35)(A). Initially, there are two important points
worth noting about these provisions. First, because institutional controls are often used to
implement land use restrictions, failing to comply with a land use restriction may also impede
the effectiveness or integrity of an institutional control, and vice versa. As explained below,
however, these two provisions do set forth distinct requirements. Second, these are ongoing
obligations and, therefore, EPA believes the statute requires bona fide prospective purchasers,
contiguous property owners, and innocent landowners to comply with land use restrictions and to
implement institutional controls even if the restrictions or institutional controls were not in place
at the time the person purchased the property.
Institutional controls are administrative and legal controls that minimize the potential for
human exposure to contamination and protect the integrity of remedies by limiting land or
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resource use, providing information to modify behavior, or both.6 For example, an institutional
control might prohibit the drilling of a drinking water well in a contaminated aquifer or
disturbing contaminated soils. EPA typically uses institutional controls whenever contamination
precludes unlimited use and unrestricted exposure at the property. Institutional controls are
often needed both before and after completion of the remedial action. Also, institutional controls
may need to remain in place for an indefinite duration and, therefore, generally need to survive
changes in property ownership (i.e., run with the land) to be legally and practically effective.
Generally, EPA places institutional controls into four categories:
(1) governmental controls (e.g., zoning);
(2) proprietary controls (e.g., covenants, easements);
(3) enforcement documents (e.g., orders, consent decrees); and
(4) informational devices (e.g., land record/deed notices).
Institutional controls often require a property owner to take steps to implement the controls, such
as conveying a property interest (e.g., an easement or restrictive covenant) to another party such
as a governmental entity, thus providing that party with the right to enforce a land use restriction;
applying for a zoning change; or recording a notice in the land records.
Because institutional controls are tools used to limit exposure to contamination or protect
a remedy by limiting land use, they are often used to implement or establish land use restrictions
relied on in connection with the response action. However, the Brownfields Amendments
require compliance with land use restrictions relied on in connection with the response action,
even if those restrictions have not been properly implemented through the use of an enforceable
institutional control. Generally, a land use restriction may be considered "relied on" when the
restriction is identified as a component of the remedy. Land use restrictions relied on in
connection with a response action may be documented in several places depending on the
program under which the response action was conducted, including: a risk assessment; a remedy
decision document; a remedy design document; a permit, order, or consent decree; under some
state response programs, a statute (e.g., no groundwater wells when relying on natural
attenuation); or, in other documents developed in conjunction with a response action.
An institutional control may not serve the purpose of implementing a land use restriction
for a variety of reasons, including: (1) the institutional control is never, or has yet to be,
implemented; (2) the property owner or other persons using the property impede the
effectiveness of the institutional controls in some way and the party responsible for enforcement
of the institutional controls neglects to take sufficient measures to bring those persons into
compliance; or (3) a court finds the controls to be unenforceable. For example, a chosen remedy
might rely on an ordinance that prevents groundwater from being used as drinking water. If the
local government failed to enact the ordinance, later changed the ordinance to allow for drinking
6 For additional information on institutional controls, see "Institutional Controls: A Site
Manager's Guide to Identifying, Evaluating, and Selecting Institutional Controls at Superfund and RCRA
Corrective Action Cleanups," September 2000, (OSWER Directive 9355.0-74FS-P).
7
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water use, or failed to enforce the ordinance, a landowner is still required to comply with the
groundwater use restriction identified as part of the remedy to maintain its landowner liability
protection. Unless authorized by the regulatory agency responsible for overseeing the remedy, if
the landowner fails to comply with a land use restriction relied on in connection with a response
action, the owner will forfeit the liability protection and EPA may use its CERCLA authorities to
order the owner to remedy the violation, or EPA may remedy the violation itself and seek cost
recovery from the noncompliant landowner.
In order to meet the statutory criteria of a bona fide prospective purchaser, contiguous
property owner, or innocent landowner, a party may not impede the effectiveness or integrity of
any institutional control employed in connection with a response action. See CERCLA §§
101(40)(F)(ii), 107(q)(l)(A)(v)(II), 101(35)(A)(iii). Impeding the effectiveness or integrity of an
institutional control does not require a physical disturbance or disruption of the land. A
landowner could jeopardize the reliability of an institutional control through actions short of
violating restrictions on land use. In fact, not all institutional controls actually restrict the use of
land. For example, EPA and State programs often use notices to convey information regarding
contamination on site rather than actually restricting the use. To do this, EPA or a State may
require a notice to be placed in the land records. If a landowner removed the notice, the removal
would impede the effectiveness of the institutional control. A similar requirement is for a
landowner to give notice of any institutional controls on the property to a purchaser of the
property. Failure to give this notice may impede the effectiveness of the control. Another
example of impeding the effectiveness of an institutional control would be if a landowner applies
for a zoning change or variance when the current designated use of the property was intended to
act as an institutional control. Finally, EPA might also consider a landowner's refusal to assist
in the implementation of an institutional control employed in connection with the response
action, such as not recording a deed notice or not agreeing to an easement or covenant, to
constitute a violation of the requirement not to impede the effectiveness or integrity of an
institutional control.7
An owner may seek changes to land use restrictions and institutional controls relied on in
connection with a response action by following procedures required by the regulatory agency
responsible for overseeing the original response action. Certain restrictions and institutional
controls may not need to remain in place in perpetuity. For example, changed site conditions,
such as natural attenuation or additional cleanup, may alleviate the need for restrictions or
institutional controls. If an owner believes changed site conditions warrant a change in land or
resource use or is interested in performing additional response actions that would eliminate the
need for particular restrictions and controls, the owner should review and follow the appropriate
regulatory agency procedures prior to undertaking any action that may violate the requirements
of this provision.
7 This may also constitute a violation of the ongoing obligation to provide full cooperation,
assistance, and access. CERCLA §§ 101(40)(E), 107(q)(l)(A)(iv), 101(35)(A).
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2. Reasonable Steps
a. Overview
Congress, in enacting the landowner liability protections, included the condition that
bona fide prospective purchasers, contiguous property owners, and innocent landowners take
"reasonable steps" with respect to hazardous substance releases to do all of the following:
- Stop continuing releases,
- Prevent threatened future releases, and
- Prevent or limit human, environmental, or natural resource exposure to
earlier hazardous substance releases.
CERCLA§§ 101(40)(D), 107(q)(l)(A)(iii), 101(35)(B)(i)(II).8 Congress included this condition
as an incentive for certain owners of contaminated properties to avoid CERCLA liability by,
among other things, acting responsibly where hazardous substances are present on their property.
In adding this new requirement, Congress adopted an approach that is consonant with traditional
common law principles and the existing CERCLA "due care" requirement.9
By making the landowner liability protections subject to the obligation to take
"reasonable steps," EPA believes Congress intended to balance the desire to protect certain
landowners from CERCLA liability with the need to ensure the protection of human health and
the environment. In requiring reasonable steps from parties qualifying for landowner liability
protections, EPA believes Congress did not intend to create, as a general matter, the same types
of response obligations that exist for a CERCLA liable party (e.g., removal of contaminated soil,
8 CERCLA § 101(40)(D), the bona fide prospective purchaser reasonable steps provision,
provides: "[t]he person exercises appropriate care with respect to hazardous substances found at the
facility by taking reasonable steps to (i) stop any continuing release; (ii) prevent any threatened future
release; and (iii) prevent or limit human, environmental, or natural resource exposure to any previously
released hazardous substance."
CERCLA § 107(q)(l)(A), the contiguous property owner reasonable steps provision, provides:
"the person takes reasonable steps to (I) stop any continuing release; (II) prevent any threatened future
release; and (III) prevent or limit human, environmental, or natural resource exposure to any hazardous
substance released on or from property owned by that person."
CERCLA § 101(35)(B)(II), the innocent landowner reasonable steps provision, provides: "the
defendant took reasonable steps to (aa) stop any continuing release; (bb) prevent any threatened future
release; and (cc) prevent or limit any human, environmental, or natural resource exposure to any
previously released hazardous substance."
9 See innocent landowner provision. CERCLA § 107(b)(3)(a).
9
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extraction and treatment of contaminated groundwater).10 Indeed, the contiguous property
owner provision's legislative history states that absent "exceptional circumstances . . ., these
persons are not expected to conduct ground water investigations or install remediation systems,
or undertake other response actions that would be more properly paid for by the responsible
parties who caused the contamination." S. Rep. No. 107-2, at 11 (2001). In addition, the
Brownfields Amendments provide that contiguous property owners are generally not required to
conduct groundwater investigations or to install ground water remediation systems. CERCLA §
107(q)(l)(D).n Nevertheless, it seems clear that Congress also did not intend to allow a
landowner to ignore the potential dangers associated with hazardous substances on its property.
Although the reasonable steps legal standard is the same for the three landowner
provisions, the obligations may differ to some extent because of other differences among the
three statutory provisions. For example, as noted earlier, one of the conditions is that a person
claiming the status of a bona fide prospective purchaser, contiguous property owner, or innocent
landowner must have "carried out all appropriate inquiries" into the previous ownership and uses
of the facility in accordance with generally accepted good commercial and customary standards
and practices. CERCLA §§ 101(40)(B), 107(q)(l)(A)(viii), 101(35)(B). However, for a
contiguous property owner or innocent landowner, knowledge of contamination defeats
eligibility for the liability protection. A bona fide prospective purchaser may purchase with
knowledge of the contamination and still be eligible for the liability protection. Thus, only the
bona fide prospective purchaser could purchase a contaminated property that is, for example, on
CERCLA's National Priorities List12 or is undergoing active cleanup under an EPA or State
10 There could be unusual circumstances where the reasonable steps required of a bona fide
prospective purchaser, contiguous property owner, or innocent landowner would be akin to the
obligations of a potentially responsible party (e.g., the only remaining response action is institutional
controls or monitoring, the benefit of the response action will inure primarily to the landowner, or the
landowner is the only person in a position to prevent or limit an immediate hazard). This may be more
likely to arise in the context of a bona fide prospective purchaser as the purchaser may buy the property
with knowledge of the contamination.
11 CERCLA § 107(q)(l)(D) provides:
GROUND WATER. - With respect to a hazardous substance from one or more sources that
are not on the property of a person that is a contiguous property owner that enters ground
water beneath the property of the person solely as a result of subsurface migration in an
aquifer, subparagraph (A)(iii) shall not require the person to conduct ground water
investigations or to install ground water remediation systems, except in accordance with
the policy of the Environmental Protection Agency concerning owners of property
containing contaminated aquifers, dated May 24, 1995.
12 The National Priorities List is "the list compiled by EPA pursuant to CERCLA § 105, of
uncontrolled hazardous substance releases in the United States that are priorities for long-term remedial
evaluation and response." 40 C.F.R. § 300.5 (2001).
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cleanup program, and still maintain his liability protection.
The pre-purchase "appropriate inquiry" by the bona fide prospective purchaser will most
likely inform the bona fide prospective purchaser as to the nature and extent of contamination on
the property and what might be considered reasonable steps regarding the contamination - - how
to stop continuing releases, prevent threatened future releases, and prevent or limit human,
environmental, and natural resource exposures. Knowledge of contamination and the
opportunity to plan prior to purchase should be factors in evaluating what are reasonable steps,
and could result in greater reasonable steps obligations for a bona fide prospective purchaser.13
Because the pre-purchase "appropriate inquiry" performed by a contiguous property owner or
innocent landowner must result in no knowledge of the contamination for the landowner liability
protection to apply, the context for evaluating reasonable steps for such parties is different. That
is, reasonable steps in the context of a purchase by a bona fide prospective purchaser may differ
from reasonable steps for the other protected landowner categories (who did not have knowledge
or an opportunity to plan prior to purchase). Once a contiguous property owner or innocent
landowner learns that contamination exists on his property, then he must take reasonable steps
considering the available information about the property contamination.
The required reasonable steps relate only to responding to contamination for which the
bona fide prospective purchaser, contiguous property owner, or innocent landowner is not
responsible. Activities on the property subsequent to purchase that result in new contamination
can give rise to full CERCLA liability. That is, more than reasonable steps will likely be
required from the landowner if there is new hazardous substance contamination on the
landowner's property for which the landowner is liable. See, e.g.. CERCLA § 101(40)(A)
(requiring a bona fide prospective purchaser to show "[a]ll disposal of hazardous substances at
the facility occurred before the person acquired the facility").
As part of the third party defense that pre-dates the Brownfields Amendments and
continues to be a distinct requirement for innocent landowners, CERCLA requires the exercise
of "due care with respect to the hazardous substance concerned, taking into consideration the
characteristics of such hazardous substance, in light of all the relevant facts and circumstances."
CERCLA § 107(b)(3)(a). The due care language differs from the Brownfields Amendments'
new reasonable steps language. However, the existing case law on due care provides a reference
point for evaluating the reasonable steps requirement. When courts have examined the due care
requirement in the context of the pre-existing innocent landowner defense, they have generally
concluded that a landowner should take some positive or affirmative step(s) when confronted
with hazardous substances on its property. Because the due care cases cited in Attachment B
(see Section III.B.2.b "Questions and Answers," below) interpret the due care statutory language
and not the reasonable steps statutory language, they are provided as a reference point for the
reasonable steps analysis, but are not intended to define reasonable steps.
The reasonable steps determination will be a site-specific, fact-based inquiry. That
13 As noted earlier, section 107(r)(2) provides EPA with a windfall lien on the property.
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inquiry should take into account the different elements of the landowner liability protections and
should reflect the balance that Congress sought between protecting certain landowners from
CERCLA liability and assuring continued protection of human health and the environment.
Although each site will have its own unique aspects involving individual site analysis,
Attachment B provides some questions and answers intended as general guidance on the
question of what actions may constitute reasonable steps.
b. Site-Specific Comfort/Status Letters Addressing Reasonable Steps
Consistent with its "Policy on the Issuance of Comfort/Status Letters," ("1997
Comfort/Status Letter Policy"), 62 Fed. Reg. 4,624 (1997), EPA may, in its discretion, provide a
comfort/status letter addressing reasonable steps at a specific site, upon request. EPA anticipates
that such letters will be limited to sites with significant federal involvement such that the Agency
has sufficient information to form a basis for suggesting reasonable steps (e.g., the site is on the
National Priorities List or EPA has conducted or is conducting a removal action on the site). In
addition, as the 1997 Comfort/Status Letter Policy provides, "[i]t is not EPA's intent to become
involved in typical real estate transactions. Rather, EPA intends to limit the use of... comfort
to where it may facilitate the cleanup and redevelopment of brownfields, where there is the
realistic perception or probability of incurring Superfund liability, and where there is no other
mechanism available to adequately address the party's concerns." Id In its discretion, a Region
may conclude in a given case that it is not necessary to opine about reasonable steps because it is
clear that the landowner does not or will not meet other elements of the relevant landowner
liability protection. A sample reasonable steps comfort/status letter is attached to this
memorandum (see Attachment C).
The 1997 Comfort/Status Letter Policy recognizes that, at some sites, the state has the
lead for day-to-day activities and oversight of a response action, and the Policy includes a
"Sample State Action Letter." For reasonable steps inquiries at such sites, Regions should
handle responses consistent with the existing 1997 Comfort/Status Letter Policy. In addition,
where appropriate, if EPA has had the lead at a site with respect to response actions (e.g., EPA
has conducted a removal action at the site), but the state will be taking over the lead in the near
future, EPA should coordinate with the state prior to issuing a comfort/status letter suggesting
reasonable steps at the site.
3. Cooperation, Assistance, and Access
The Brownfields Amendments require that bona fide prospective purchasers, contiguous
property owners, and innocent landowners provide full cooperation, assistance, and access to
persons who are authorized to conduct response actions or natural resource restoration at the
vessel or facility from which there has been a release or threatened release, including the
cooperation and access necessary for the installation, integrity, operation, and maintenance of
any complete or partial response action or natural resource restoration at the vessel or facility.
CERCLA §§ 101(40)(E), 107(q)(l)(A)(iv), 101(35)(A).
12
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4. Compliance with Information Requests and Administrative Subpoenas
The Brownfields Amendments require bona fide prospective purchasers and contiguous
property owners to be in compliance with, or comply with, any request for information or
administrative subpoena issued by the President under CERCLA. CERCLA §§ 101(40)(G),
107(q)(l)(A)(vi). In particular, EPA expects timely, accurate, and complete responses from all
recipients of section 104(e) information requests. As an exercise of its enforcement discretion,
EPA may consider a person who has made an inconsequential error in responding (e.g., the
person sent the response to the wrong EPA address and missed the response deadline by a day), a
bona fide prospective purchaser or contiguous property owner, as long as the landowner also
meets the other conditions of the applicable landowner liability protection.
5. Providing Legally Required Notices
The Brownfields Amendments subject bona fide prospective purchasers and contiguous
property owners to the same "notice" requirements. Both provisions mandate, in pertinent part,
that "[t]he person provides all legally required notices with respect to the discovery or release of
any hazardous substances at the facility." CERCLA §§ 101(40)(C), 107(q)(l)(A)(vii). EPA
believes that Congress' intent in including this as an ongoing obligation was to ensure that EPA
and other appropriate entities are made aware of hazardous substance releases in a timely
manner.
"Legally required notices" may include those required under federal, state, and local
laws. Examples of federal notices that may be required include, but are not limited to, those
under: CERCLA § 103 (notification requirements regarding released substances); EPCRA § 304
("emergency notification"); and RCRA § 9002 (notification provisions for underground storage
tanks). The bona fide prospective purchaser and contiguous property owner have the burden of
ascertaining what notices are legally required in a given instance and of complying with those
notice requirements. Regions may require these landowners to self-certify that they have
provided (in the case of contiguous property owners), or will provide within a certain number of
days of purchasing the property (in the case of bona fide prospective purchasers), all legally
required notices. Such self-certifications may be in the form of a letter signed by the landowner
as long as the letter is sufficient to satisfy EPA that applicable notice requirements have been
met. Like many of the other common elements discussed in this memorandum, providing legally
required notices is an ongoing obligation of any landowner desiring to maintain its status as a
bona fide prospective purchaser or contiguous property owner.
IV. Conclusion
Evaluating whether a landowner has met the criteria of a particular landowner provision
will require careful, fact-specific analysis by the regions as part of their exercise of enforcement
discretion. This memorandum is intended to provide EPA personnel with some general guidance
on the common elements of the landowner liability protections. As EPA implements the
Brownfields Amendments, it will be critical for the regions to share site-specific experiences and
13
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information pertaining to the common elements amongst each other and with the Office of Site
Remediation Enforcement, in order to ensure national consistency in the exercise of the
Agency's enforcement discretion. EPA anticipates that its Landowner Liability Protection
Subgroup, which is comprised of members from various headquarters offices, the Offices of
Regional Counsel, the Office of General Counsel, and the Department of Justice, will remain
intact for the foreseeable future and will be available to serve as a clearinghouse for information
for the regions on the common elements.
Questions and comments regarding this memorandum or site-specific inquiries should be
directed to Cate Tierney, in OSRE's Regional Support Division (202-564-4254,
Tierney.Cate@EPA.gov). or Greg Madden, in OSRE's Policy & Program Evaluation Division
(202-564-4229, Madden.Gregorv@,EPA.govY
V. Disclaimer
This memorandum is intended solely for the guidance of employees of EPA and the
Department of Justice and it creates no substantive rights for any persons. It is not a regulation
and does not impose legal obligations. EPA will apply the guidance only to the extent
appropriate based on the facts.
Attachments
cc: Jewell Harper (O SRE)
Paul Connor (OSRE)
Sandra Connors (OSRE)
Thomas Dunne (OSWER)
Benjamin Fisherow (DOJ)
Linda Garczynski (OSWER)
Bruce Gelber (DOJ)
Steve Luftig (OSWER)
Earl Salo (OGC)
EPA Brownfields Landowner Liability Protection Subgroup
14
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Attachment A
Chart Summarizing Applicability of "Common Elements" to Bona Fide Prospective
Purchasers, Contiguous Property Owners, and Section 101(35)(A)(i) Innocent Landowners
Common Element among the
Brownfields Amendments Landowner Provisions
All Appropriate Inquiry
No affiliation demonstration
Compliance with land use restrictions and institutional
controls
Taking reasonable steps
Cooperation, assistance, access
Compliance with information requests and administrative
subpoenas
Providing legally required notices
Bona Fide
Prospective
Purchaser
Contiguous
Property
Owner
Section 101
(35)(A)(i)
Innocent
Landowner
Although the innocent landowner provision does not contain this "affiliation" language, in order
to meet the statutory criteria of the innocent landowner liability protection, a person must
establish by a preponderance of the evidence that the act or omission that caused the release or
threat of release of hazardous substances and the resulting damages were caused by a third party
with whom the person does not have an employment, agency, or contractual relationship.
CERCLA § 107(b)(3). Contractual relationship is defined in section 101(35)(A).
' Compliance with information requests and administrative subpoenas is not specified as a statutory
criterion for achieving and maintaining the section 101(35)(A)(i) innocent landowner liability
protection. However, CERCLA requires compliance with administrative subpoenas from all
persons, and timely, accurate, and complete responses from all recipients of EPA information
requests.
' Provision of legally required notices is not specified as a statutory criterion for achieving and
maintaining the section 101(35)(A)(i) innocent landowner liability protection. These
landowners may, however, have notice obligations under federal, state and local laws.
Common Elements Chart
Attachment A
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Attachment B
Reasonable Steps Questions and Answers
The "reasonable steps" required of a bona fide prospective purchaser, contiguous
property owner, or section 101(35)(A)(i) innocent landowner under CERCLA §§ 101(40)(D),
107(q)(l)(A)(iii), and 101(35)(B)(i)(II), will be a site-specific, fact-based inquiry. Although
each site will have its own unique aspects involving individual site analysis, below are some
questions and answers intended to provide general guidance on the question of what actions may
constitute reasonable steps. The answers provide a specific response to the question posed,
without identifying additional actions that might be necessary as reasonable steps or actions that
may be required under the other statutory conditions for each landowner provision (e.g.,
providing cooperation and access). In addition, the answers do not address actions that may be
required under other federal statutes (e.g., the Resource Conservation and Recovery Act, 42
U.S.C. § 6901 et seq.; the Clean Water Act, 33 U.S.C. § 1251, et seq.; and the Toxic Substances
Control Act, 15 U.S.C. § 2601, et seq.), and do not address landowner obligations under state
statutory or common law.14
Notification
Ql: If a person conducts "all appropriate inquiry" with respect to a property where EPA has
conducted a removal action, discovers hazardous substance contamination on the property that is
unknown to EPA, and then purchases the property, is notification to EPA or the state about the
contamination a reasonable step?
Al: Yes. First, bona fide prospective purchasers may have an obligation to provide notice of
the discovery or release of a hazardous substance under the legally required notice provision,
CERCLA § 101(40)(C). Second, even if not squarely required by the notice conditions,
providing notice of the contamination to appropriate governmental authorities would be a
reasonable step in order to prevent a "threatened future release" and "prevent or limit . . .
exposure." Congress specifically identified "notifying appropriate Federal, state, and local
officials" as a typical reasonable step. S. Rep. No. 107-2, at 11 (2001); see also. Bob's Beverage
Inc. v. Acme. Inc.. 169 F. Supp. 2d 695, 716 (N.D. Ohio 1999) (failure to timely notify EPA and
Ohio EPA of groundwater contamination was factor in conclusion that party failed to exercise
due care), aff'd, 264 F. 3d 692 (6th Cir. 2001). It should be noted that the bona fide prospective
purchaser provision is the only one of the three landowner provisions where a person can
purchase property with knowledge that it is contaminated and still qualify for the landowner
liability protection.
14 The Brownfields Amendments did not alter CERCLA § 114(a), which provides:
"[njothing in this chapter shall be construed or interpreted as preempting any State from imposing any
additional liability or requirements with respect to the release of hazardous substances within such State."
Reasonable Steps Qs & As 1 Attachment B
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Site Restrictions
Q2: Where a property owner discovers unauthorized dumping of hazardous substances on a
portion of her property, are site access restrictions reasonable steps?
A2: Site restrictions are likely appropriate as a first step, once the dumping is known to the
owner. Reasonable steps include preventing or limiting "human, environmental, or natural
resource exposure" to hazardous substances. CERCLA §§ 101(40)(D)(iii), 107(q)(l)(A)(iii)(III),
101(35)(B)(i)(II)(cc). The legislative history for the contiguous property owner provision
specifically notes that "erecting and maintaining signs or fences to prevent public exposure" may
be typical reasonable steps. S. Rep. No. 107-2, at 11 (2001); see also. Idylwoods Assoc. v.
Mader Capital. Inc.. 915 F. Supp. 1290, 1301 (W.D.N.Y. 1996) (failure to restrict access by
erecting signs or hiring security personnel was factor in evaluating due care), off'don reh 'g, 956
F. Supp. 410, 419-20 (W.D.N.Y. 1997); New York v. Delmonte. No. 98-CV-0649E, 2000 WL
432838, *4 (W.D.N.Y. Mar. 31, 2000) (failure to limit access despite knowledge of trespassers
was not due care).
Containing Releases or Threatened Releases
Q3: If a new property owner discovers some deteriorating 55 gallon drums containing unknown
material among empty drums in an old warehouse on her property, would segregation of the
drums and identification of the material in the drums constitute reasonable steps?
A3: Yes, segregation and identification of potential hazards would likely be appropriate first
steps. Reasonable steps must be taken to "prevent any threatened future release." CERCLA §§
101(40)(D)(ii), 107(q)(l)(A)(iii)(II), 101(35)(B)(i)(II)(bb). To the extent the drums have the
potential to leak, segregation and containment (e.g., drum overpack) would prevent mishandling
and releases to the environment. For storage and handling purposes, an identification of the
potential hazards from the material will likely be necessary. Additional identification steps
would likely be necessary for subsequent disposal or resale if the material had commercial value.
Q4: If a property owner discovers that the containment system for an on-site waste pile has
been breached, do reasonable steps include repairing the breach?
A4: One of the reasonable steps obligations is to "stop any continuing release." CERCLA §§
101(40)(D)(i), 107(q)(l)(A)(iii)(I), 101(35)(B)(i)(II)(aa). In general, the property owner should
take actions to prevent contaminant migration where there is a breach from an existing
containment system. Both Congress and the courts have identified maintenance of hazardous
substance migration controls as relevant property owner obligations. For example, in discussing
contiguous property owners' obligations for migrating groundwater plumes, Congress identified
"maintaining any existing barrier or other elements of a response action on their property that
Reasonable Steps Qs & As 2 Attachment B
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address the contaminated plume" as a typical reasonable step. S. Rep. No. 107-2, at 11 (2001);
see also. Franklin County Convention Facilities Auth. v. American Premier Underwriters. Inc..
240 F.3d 534, 548 (6th Cir. 2001) (failure to promptly erect barrier that allowed migration was
not due care); United States v. DiBiase Salem Realty Trust. No. Civ. A. 91-11028-MA, 1993
WL 729662, *7 (D. Mass. Nov. 19, 1993) (failure to reinforce waste pit berms was factor in
concluding no due care), aff'd, 45 F.3d 541, 545 (1st Cir. 1995). In many instances, the current
property owner will have responsibility for maintenance of the containment system. If the
property owner has responsibility for maintenance of the system as part of her property purchase,
then she should repair the breach. In other instances, someone other than the current landowner
may have assumed that responsibility (e.g., a prior owner or other liable parties that signed a
consent decree with EPA and/or a State). If someone other than the property owner has
responsibility for maintenance of the containment system pursuant to a contract or other
agreement, then the question is more complicated. At a minimum, the current owner should give
notice to the person responsible for the containment system and to the government. Moreover,
additional actions to prevent contaminant migration would likely be appropriate.
Q5: If a bona fide prospective purchaser buys property at a Superfund site where part of the
approved remedy is an asphalt parking lot cap, but the entity or entities responsible for
implementing the remedy (e.g., PRPs who signed a consent decree) are unable to repair the
deteriorating cap (e.g., the PRPs are now defunct), should the bona fide prospective purchaser
repair the deteriorating asphalt parking lot cap as reasonable steps?
A5: Taking "reasonable steps" includes steps to: "prevent or limit any human, environmental, or
natural resource exposure to any previously released hazardous substances." CERCLA §§
101(40)(D)(iii), 107(q)(l)(A)(iii)(III), 101(35)(B)(i)(II)(cc). In this instance, the current
landowner may be in the best position to identify and quickly take steps to repair the asphalt cap
and prevent additional exposures.
Remediation
Q6: If a property is underlain by contaminated groundwater emanating from a source on a
contiguous or adjacent property, do reasonable steps include remediating the groundwater?
A6: Generally not. Absent exceptional circumstances, EPA will not look to a landowner whose
property is not a source of a release to conduct groundwater investigations or install groundwater
remediation systems. Since 1995, EPA's policy has been that, in the absence of exceptional
circumstances, such a property owner did not have "to take any affirmative steps to investigate
or prevent the activities that gave rise to the original release" in order to satisfy the innocent
landowner due care requirement. See May 24, 1995 "Policy Toward Owners of Property
Containing Contaminated Aquifers." ("1995 Contaminated Aquifers Policy"). In the
Brownfields Amendments, Congress explicitly identified this policy in noting that reasonable
Reasonable Steps Qs & As 3 Attachment B
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steps for a contiguous property owner "shall not require the person to conduct groundwater
investigations or to install groundwater remediation systems," except in accordance with that
policy. See CERCLA § 107(q)(l)(D). The policy does not apply "where the property contains a
groundwater well, the existence or operation of which may affect the migration of contamination
in the affected area." 1995 Contaminated Aquifers Policy, at 5. In such instances, a site-specific
analysis should be used in order to determine reasonable steps. In some instances, reasonable
steps may simply mean operation of the groundwater well consistent with the selected remedy.
In other instances, more could be required.
Q7: If a protected landowner discovers a previously unknown release of a hazardous substance
from a source on her property, must she remediate the release?
A7: Provided the landowner is not otherwise liable for the release from the source, she should
take some affirmative steps to "stop the continuing release," but EPA would not, absent unusual
circumstances, look to her for performance of complete remedial measures. However, notice to
appropriate governmental officials and containment or other measures to mitigate the release
would probably be considered appropriate. Compare Lincoln Properties. Ltd, v. Higgins. 823 F.
Supp. 1528, 1543-44 (E.D. Calif. 1992) (sealing sewer lines and wells and subsequently
destroying wells to protect against releases helped establish party exercised due care); Redwing
Carriers. Inc. v. Saraland Apartments. 94 F.3d 1489, 1508 (11th Cir. 1996) (timely development
of maintenance plan to remove tar seeps was factor in showing due care was exercised); New
York v. Lashins Arcade Co.. 91F.3d353 (2nd Cir. 1996) (instructing tenants not to discharge
hazardous substances into waste and septic systems, making instructions part of tenancy
requirements, and inspecting to assure compliance with this obligation, helped party establish
due care); with Idvlwoods Assoc. v. Mader Capital. Inc.. 956 F. Supp. 410, 419-20 (W.D.N.Y.
1997) (property owner's decision to do nothing resulting in spread of contamination to
neighboring creek was not due care); Kerr-McGee Chem. Corp. v. Lefton Iron & Metal Co.. 14
F.3d 321, 325 (7th Cir. 1994) (party that "made no attempt to remove those substances or to take
any other positive steps to reduce the threat posed" did not exercise due care). As noted earlier,
if the release is the result of a disposal after the property owner's purchase, then she may be
required to undertake full remedial measures as a CERCLA liable party. Also, if the source of
the contamination is on the property, then the property owner will not qualify as a contiguous
property owner but may still qualify as an innocent landowner or a bona fide prospective
purchaser.
Site Investigation
Q8: If a landowner discovers contamination on her property, does the obligation to take
reasonable steps require her to investigate the extent of the contamination?
A8: Generally, where the property owner is the first to discover the contamination, she should
Reasonable Steps Qs & As 4 Attachment B
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take certain basic actions to assess the extent of contamination. Absent such an assessment, it
will be very difficult to determine what reasonable steps will stop a continuing release, prevent a
threatened future release, or prevent or limit exposure. While a full environmental investigation
may not be required, doing nothing in the face of a known or suspected environmental hazard
would likely be insufficient. See, e.g.. United States v. DiBiase Salem Realty Trust. 1993 WL
729662, *7 (failure to investigate after becoming aware of dangerous sludge pits was factor in
concluding party did not exercise due care), qff'd, 45 F.3d 541, 545 (1st Cir. 1995); United States
v. A&N Cleaners and Launderers. Inc.. 854 F. Supp. 229 (S.D.N.Y. 1994) (dictum) (failing to
assess environmental threats after discovery of disposal would be part of due care analysis).
Where the government is actively investigating the property, the need for investigation by the
landowner may be lessened, but the landowner should be careful not to rely on the fact that the
government has been notified of a hazard on her property as a shield to potential liability where
she fails to conduct any investigation of a known hazard on her property. Compare New York v.
Lashins Arcade Co.. 91 F.3d 353, 361 (2nd Cir. 1996) (no obligation to investigate where RI/FS
already commissioned^) with DiBiase Salem Realty Trust. 1993 WL 729662, *7 (State
Department of Environmental Quality knowledge of hazard did not remove owner's obligation
to make some assessment of site conditions), aff'd, 45 F.3d 541, 545 (1st Cir. 1995).
Performance of EPA Approved Remedy
Q9: If a new purchaser agrees to assume the obligations of a prior owner PRP, as such
obligations are defined in an order or consent decree issued or entered into by the prior owner
and EPA, will compliance with those obligations satisfy the reasonable steps requirement?
A9: Yes, in most cases compliance with the obligations of an EPA order or consent decree will
satisfy the reasonable steps requirement so long as the order or consent decree comprehensively
addresses the obligations of the prior owner through completion of the remedy. It should be
noted that not all orders or consent decrees identify obligations through completion of the
remedy and some have open-ended cleanup obligations.
Reasonable Steps Qs & As 5 Attachment B
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Attachment C
Sample Federal Superfund Interest Reasonable Steps Letter
The sample comfort/status letter below may be used in the exercise of enforcement
discretion where EPA has sufficient information regarding the site to have assessed the
hazardous substance contamination and has enough information about the property to make
suggestions as to steps necessary to satisfy the "reasonable steps " requirement. In addition, like
any comfort/status letter, the letters should be provided in accordance with EPA 's
"Comfort/Status Letter Policy. " That is, they are not necessary or appropriate for purely
private real estate transactions. Such letters may be issued when: (1) there is a realistic
perception or probability of incurring Superfund liability, (2) such comfort will facilitate the
cleanup and redevelopment of a brown/Heldproperty, (3) there is no other mechanism to
adequately address the party's concerns, and (4) EPA has sufficient information about the
property to provide a basis for suggesting reasonable steps.
[Insert Addressee]
Re: [Insert Name or Description of Property]
Dear [insert name of requester]:
I am writing in response to your letter dated [insert date] concerning the property
referenced above. As you know, the [insert name] property is located within or near the [insert
name of CERCLIS site.] EPA is currently [insert description of action EPA is taking or
plans to take and any contamination problem.]
The [bona fide prospective purchaser, contiguous property owner, or innocent
landowner] provision states that a person meeting the criteria of [insert section] is protected
from CERCLA liability [For bona fide prospective purchaser only, it may be appropriate to
insert following language: To the extent EPA's response action increases the fair market
value of the property, EPA may have a windfall lien on the property. The windfall lien is
limited to the increase in fair market value attributable to EPA's response action, capped
by EPA's unrecovered response costs.] (I am enclosing a copy of the relevant statutory
provisions for your reference.) To qualify as a [bona fide prospective purchaser, contiguous
property owner, or section 101(35)(A)(i) innocent landowner], a person must (among other
requirements) take "reasonable steps" with respect to stopping continuing releases, preventing
threatened future releases, and preventing or limiting human, environmental, or natural resources
exposure to earlier releases. You have asked what actions you must take, as the [owner or
prospective owner] of the property, to satisfy the "reasonable steps" criterion.
As noted above, EPA has conducted a [insert most recent/relevant action to
"reasonable steps" inquiry taken by EPA] at [insert property name] and has identified a
Sample Federal Superfund Interest
Reasonable Steps Letter 1 Attachment C
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number of environmental concerns. Based on the information EPA has evaluated to date, EPA
believes that, for an owner of the property, the following would be appropriate reasonable steps
with respect to the hazardous substance contamination found at the property:
[insert paragraphs outlining reasonable steps with respect to each environmental concern]
This letter does not provide a release from CERCLA liability, but only provides
information with respect to reasonable steps based on the information EPA has available to it.
This letter is based on the nature and extent of contamination known to EPA at this time. If
additional information regarding the nature and extent of hazardous substance contamination at
[insert property name] becomes available, additional actions may be necessary to satisfy the
reasonable steps criterion. In particular, if new areas of contamination are identified, you should
ensure that reasonable steps are undertaken. As the property owner, you should ensure that you
are aware of the condition of your property so that you are able to take reasonable steps with
respect to any hazardous substance contamination at or on the property.
Please note that the [bona fide prospective purchaser, contiguous property owner, or
innocent landowner] provision has a number of conditions in addition to those requiring the
property owner to take reasonable steps. Taking reasonable steps and many of the other
conditions are continuing obligations of the [bona fide prospective purchaser, contiguous
property owner, or section 101(35)(A)(i) innocent landowner] You will need to assess
whether you satisfy each of the statutory conditions for the [bona fide prospective purchaser,
contiguous property owner, or innocent landowner] provision and continue to meet the
applicable conditions.
EPA hopes this information is useful to you. If you have any questions, or wish to
discuss this letter, please feel free to contact [insert EPA contact and address].
Sincerely,
[insert name of EPA contact]
Sample Federal Super fund Interest
Reasonable Steps Letter 2 Attachment C
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Top Ten Questions to Ask Before
Buying a Superfund Site
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NOVEMBER 2006
EPA-330-F-06-001
Top 10 Questions to Ask When
Buying a Superfund Site
Office of Enforcement and Compliance Assurance
Office of Site Remediation Enforcement
Reusing
Superfund Sites
This brochure provides answers to questions that are useful to ask when
acquiring federal Superfund sites. Its purpose is to support the reuse of
sites by informing parties about the opportunities and issues associated
with their reuse. For purposes of this brochure, site is defined as any
property where a hazardous substance has come to be located. Thus, even
a property not the source of the release of hazardous substances can be part
of the site if hazardous substances come to be located on or under the
property.
The 2002 Superfund liability protections1 are designed to be self-
implementing, meaning that a prospective purchaser does not need to
obtain approval from the U.S. Environmental Protection Agency ("EPA") prior to purchasing a federal
Superfund site where an EPA action is ongoing or has been completed. However, EPA strongly recommends
that prospective purchasers contact the appropriate EPA Regional office2 prior to purchase of a federal
Superfund site or a property within a site to discuss the cleanup status of the site and other site-related issues.
1. WHY Is BUYING A SUPERFUND SITE OR PROPERTIES WITHIN A SUPERFUND SITE A GOOD
IDEA?
LOCATION, LOCATION, LOCATION. Many federal Superfund sites have advantageous locations that are
accessible to urban infrastructure and the public. Some federal, state, and local government agencies offer
grants, loans, and tax incentives to encourage development of formerly contaminated properties and their
surrounding areas. In addition, the scope of contamination at many federal Superfund sites is well documented,
which minimizes future surprises regarding undiscovered contamination.
Federal Superfund sites throughout the country have been transformed into major shopping centers, business
parks, residential subdivisions, and recreational facilities. Many more federal Superfund sites are being
revitalized for use by small businesses. A large number of federal Superfund sites are suitable for revitalization
even during the cleanup.
Revitalizing federal Superfund sites has an additional significant environmental benefit. A study conducted by
George Washington University has estimated that for every formerly contaminated acre revitalized, 4.5 acres of
undeveloped land are preserved.3
1 The most recent Superfund liability protections were included in an amendment to the Superfund law, the Small
Business Liability Relief and Brownfields Revitalization Act (commonly referred to as the Brownfields Amendments),
which were enacted on January 11, 2002.
2 Information on contacting EPA's Regional Offices is available on EPA's Web site at
http://www.epa.gov/epahome/whereyoulive.htnrfregiontext.
3 Deason, Sherk, and Carroll, The George Washington University. Public Policies and Private Decisions Affecting
the Redevelopment of Brownfields: An Analysis of Critical Factors, Relative Weights andAreal Differentials, prepared for
U.S. EPA, Sept. 2001.
1
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Top 10 Questions to Ask When Buying a Superfund Site
2. How CAN I FIND OUT MORE INFORMATION ABOUT THE STATUS OF A SITE AND IF IT'S
SAFE FOR REUSE?
THE VAST MAJORITY OF FEDERAL SUPERFUND SITES ARE PROTECTIVE OF HUMAN HEALTH AND THE
ENVIRONMENT FOR CERTAIN TYPES OF REUSE ACTIVITIES AFTER THEY ARE CLEANED UP. And many are
protective for reuse during cleanup. However, not all site cleanups are protective for all uses. Superfund
cleanups may be designed to accommodate specific uses. For example, a property cleaned to accommodate
commercial/industrial uses may be protective for uses such as manufacturing, shopping or office complexes. In
addition, a large number of federal Superfund sites, or portions of the sites, are suitable for revitalization during
the cleanup so that the property can be used in a timely manner.
Fact sheets describing a site's history, current cleanup status, and
who to contact for more information are available on EPA's Web
site at http://cfpub.epa.gov/supercpad/cursites/srchsites.cfm.
EPA also offers many tools to help facilitate the reuse of a federal
Superfund site including:
comfort/status letters
site-specific reuse fact sheets and
Ready for Reuse ("RfR") Determinations
Portions of the Industri-plex site in Woburn, MA,
have been redeveloped as public road extensions, a
Residence Inn, a Target retail store, and a multi-
modal Regional Transportation Center.
Some EPA regional offices have or are developing prospective purchaser inquiry procedures and will schedule
conference calls or meetings with prospective purchasers to discuss whether the proposed use of the site is
compatible with an ongoing cleanup, any current or future property restrictions on the site, resolution of
potential liens, and other matters.
3. How Do I IDENTIFY ALL OF THE PARTIES I HAVE To DEAL WITH To BUY THE SITE
OR PROPERTY WITHIN THE SITE AND WHAT Is EPA'S ROLE?
THERE is NO SIMPLE SOLUTION TO IDENTIFY ALL PARTIES ASSOCIATED WITH A FEDERAL SUPERFUND SITE. As
with the purchase of any property, negotiations to buy a federal Superfund site begin with the current owner
who can be identified through title or tax records. In almost all instances, EPA does not own the site being
cleaned up. Generally, EPA's involvement relates to addressing the following questions:
1. What is the current status of a site's cleanup and what are EPA's future anticipated actions?
2. Is the proposed redevelopment compatible with a site's cleanup and with the existing and potential
future property restrictions? Note: EPA does not offer guarantees of compatibility.
3. Is the prospective purchaser aware of the applicable landowner liability protections under CERCLA?
4. How can EPA work with the prospective purchaser to settle or resolve any EPA liens?5
EPA is willing to work with prospective purchasers to clarify issues, including the existence and satisfaction of
EPA liens and property use restrictions.
A comfort/status letter is a letter intended to combat the stigma and concerns about liability associated with
contaminated sites by clarifying the cleanup status and likelihood of EPA involvement at a site.
See Question 8 below for more information regarding EPA liens.
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Top 10 Questions to Ask When Buying a Superfund Site
4. IF I BUY THE PROPERTY, WILL I BE RESPONSIBLE FOR PAST OR FUTURE CLEANUP
COSTS?
IN MOST CASES A PROSPECTIVE PURCHASER WILL NOT BE RESPONSIBLE FOR PAST OR FUTURE FEDERAL
SUPERFUND CLEANUP COSTS FOR EXISTING CONTAMINATION THAT is PRESENT ON THE PROPERTY WHEN THE
SITE IS PURCHASED. New purchasers are protected from owner or
operator liability under the federal Superfund law so long as the
new purchaser meets the definition of a "bona fide prospective
purchaser" ("BFPP") under 42 U.S.C. § 9601(40). This BFPP
provision states that a purchaser who acquires a federal Superfund
site or other contaminated property after January 11, 2002, and who
complies with eight statutory criteria will not incur federal
Superfund liability as an owner of the property. (See exhibit "Eight
Criteria for Managing Liability as a BFPP" on the following page.)
A new purchaser must achieve and maintain BFPP status for as long
as potential liability exists to remain protected from federal
Superfund liability for the existing contamination at the site.
Potential liability exists for as long as hazardous substances remain
on the property and/or the statute of limitations on cost recovery
actions is in effect. Although a BFPP is not personally liable, the
property itself could be subject to a lien as a result of EPA incurring
costs to clean up the site.6
Once contaminated -with coal tar and creosote, the
Reilly Tar & Chemical site in St. Louis Park,
Minnesota now boasts a park, a residential
development, and a pond that provides -wildlife
habitats.
Ten Criteria for All Appropriate Inquiry
Inquiry by environmental professional
Interviews with past/present owners
Review of historical sources of information
Search for recorded cleanup liens
Review of federal, state and local records
Visual inspection
Specialized knowledge of BFPP
Relationship of purchase price to value of property
Commonly known/reasonably ascertainable
information
Obviousness of presence of contamination
Some of the criteria for obtaining BFPP status
must be satisfied prior to acquiring a site. Other
criteria for maintaining BFPP status are ongoing
obligations that must be met after purchase of
the site. One example of a threshold criterion
that must be satisfied prior to purchase is that a
BFPP must perform 'all appropriate inquiries'
("AAI") concerning environmental conditions at
the site. The Final Rule for AAI, which sets
forth standards for satisfying the criterion, is
effective on November 1, 2006. Information on
how to comply with this regulation is available
on EPA's Web site at
http://www.epa.gov/brownfields/regneg.htm.
(See exhibit "Ten Criteria for All Appropriate
Inquiry" on this page.)
It is important to note that new purchasers could
become liable for environmental contamination if they interfere with the existing remedy, exacerbate existing
contamination, or cause a new release of hazardous substances. EPA is willing to discuss potential liability
issues, including qualifications for BFPP status, with prospective purchasers and their lenders. Please note that
EPA cannot give prospective purchasers legal advice. Legal advice must be sought from private legal counsel,
but EPA can explain the available liability protections.
See Question 8 below for more information regarding liens.
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Top 10 Questions to Ask When Buying a Superfund Site
As previously stated, a purchaser who achieves and maintains BFPP status is not responsible for existing
contamination, but may nonetheless want to voluntarily clean up a site, rather than wait for the potentially
responsible party or the government to do it.
When appropriate, EPA will enter into an agreement with a BFPP willing to perform a cleanup action at a site.
EPA is currently developing a model work agreement for BFPPs.
There are many reasons why a BFPP would want to perform the cleanup:
faster cleanup: a BFPP may be able to clean up a site more quickly
better coordination: a BFPP may be better able to coordinate cleanup activities into its reuse and/or
redevelopment plans
Eight Criteria for Managing Liability as a BFPP
All disposal of hazardous substances occurred before
acquisition.
The person made all appropriate inquiries about the
property before acquisition.
The person provided all legally required notices with
respect to discovery or release of any hazardous
substances at the facility.
The person exercises appropriate care with respect to
hazardous substances found at the facility by taking
reasonable steps to prevent releases.
The person provides full cooperation and access to
EPA.
The person complies with land restrictions in
connection with the response action and does not
impede the effectiveness of institutional controls.
The person complies with requests for information
and subpoenas.
The person is not potentially liable or affiliated with a
potentially responsible party ("PRP").
5.
purchasing incentives: a BFPP may be
able to negotiate a lower purchase price
from the seller by undertaking cleanup
work that the seller would otherwise be
responsible for
windfall lien settlements: a BFPP may
be able to settle a windfall lien (see
Question 8) by agreeing to perform all or
part of a necessary cleanup and/or
cost recovery: a BFPP may be entitled to
cost recovery from responsible parties
under appropriate circumstances
Do I NEED A DOCUMENT FROM EPA
CONFIRMING I HAVE BFPP STATUS?
NO, THE BFPP PROVISION IS DESIGNED TO BE
SELF-IMPLEMENTING which means that a
prospective purchaser may achieve, and then
after the purchase maintain, BFPP status
without obtaining approval or oversight from
EPA. In appropriate circumstances, however, EPA may issue a status/comfort letter to prospective purchasers
or their lenders to describe: the cleanup status of a site; anticipated future cleanup actions, if any; the available
liability protection provisions; the site-specific reasonable steps a purchaser should take with respect to the
appropriate care criteria; and the status of any EPA liens.
EPA strongly recommends that prospective purchasers contact the appropriate EPA Regional office prior to
purchase of a federal Superfund site to discuss the cleanup status of the site and other site-related issues. For
EPA Regional contact information, go to http://www.epa.gov/superfund/programs/recycle/contact.htm. In
addition, EPA strongly encourages prospective purchasers to contact the state environmental protection agency
where the site is located to discuss potential state issues such as liability and additional cleanup.
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Top 10 Questions to Ask When Buying a Superfund Site
6. As THE PROPERTY OWNER, WILL I BE RESPONSIBLE FOR ONGOING OR FUTURE
CLEANUP ACTIONS AT THE SITE?
NO, A PROPERTY OWNER WITH BFPP STATUS WILL GENERALLY NOT BE RESPONSIBLE FOR THE ONGOING OR
FUTURE CLEANUP ACTIONS, BEYOND RESOLVING ANY APPLICABLE LIENS.7 However, certain responsibilities
associated with BFPP status may involve actions to prevent or mitigate releases. For example, in certain
circumstances, BFPPs may need to take reasonable steps to stop continuing releases, prevent threatened future
releases, and prevent or limit human, environmental, or natural resource exposure to earlier hazardous substance
releases. This could include actions such as erecting or maintaining perimeter fences, removing drums, or
creating containment berms, to fulfill appropriate care obligations. For general information about appropriate
care and reasonable steps to prevent releases, go to
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-ref.pdf
7. ARE THERE LIMITATIONS ON WHAT I CAN Do AT THE SITE, AND IF So How CAN I FIND
OUT WHETHER ANY PROPERTY RESTRICTIONS ARE IN EFFECT AND WHAT THEY ARE?
THERE MAY BE LIMITS ON USES OF THE SITE OR PROPERTIES WITHIN THE SITE. The statutory criteria for
maintaining BFPP status include not impeding the integrity or effectiveness of institutional controls ("ICs") and
complying with all land use restrictions. Accordingly, prospective purchasers must determine whether any
temporary, permanent, or future use restrictions are or will be placed on
the site during cleanup (EPA calls these use restrictions 'institutional
controls') and how they may affect their plans for the site property.
Prospective purchasers must also determine if engineered controls, such
as a clay cap or monitoring wells, limit what they can do at the site
property.
Prospective purchasers can find out whether any restrictions apply to the
site property by contacting EPA's Regional office, the state
environmental agency and/or the local government, and by talking to the
current owner. Prospective purchasers can also find out this information
by performing all appropriate inquiries as described in Question 4 above
and at http://www.epa.gov/brownfields/regneg.htm. By learning whether
any restrictions apply to the site property, and what they are, prospective
purchasers can determine how their plans for the site property are
affected.
Davie Landfill in Broward County, Florida has
been redeveloped into Vista View Park, which
includes walking, horseback riding, and bike trails;
a picnic area; and a catch-and-release fishing
Enforcement of property restrictions established as part of a cleanup (e.g., restricting site property for
commercial uses only) is normally overseen by the state or local government. EPA (or the state) may also
conduct periodic reviews to examine how the cleanup is functioning (typically every five years) and whether it
remains protective.
To ensure that BFPPs maintain their liability protections, it is important that all the property restrictions are
followed and that the BFPP's use of the site does not adversely affect or impede the cleanup. In addition,
BFPPs may be asked to implement appropriate property restrictions after they purchase the site property, so
EPA encourages them to inquire about property restrictions before they purchase the site. A BFPP may
purchase a site before EPA has made a final cleanup decision and, therefore, EPA may be unable to predict what
property restrictions are appropriate and will need to be implemented in the future.
See Question 8 for a discussion on liens.
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Top 10 Questions to Ask When Buying a Superfund Site
8. DOES EPA USE LIENS THAT COULD AFFECT ME IF I ACQUIRE A SITE OR PROPERTY
WITHIN A SITE AND HOW CAN I RESOLVE OR SETTLE AN EPA LIEN?
EPA USES TWO TYPES OF LIENS THAT MAY AFFECT SITE PROPERTY: SUPERFUND LIENS AND WINDFALL LIENS.
A "Superfund Lien" entitles EPA to recover cleanup costs that the Agency incurred from the property owner. A
"Windfall Lien" is potentially applicable to a site property if the owner is a BFPP. The Windfall Lien is
designed to prevent an entity from realizing an unfair windfall from the purchase of a property that has been
cleaned up using taxpayer dollars. EPA's potential cost recovery under a Windfall Lien is limited to the
increase in fair market value of the property attributable to cleanup or the United States' unrecovered response
costs, whichever is less. BFPPs should contact their EPA Regional office regarding the existence of a lien or
EPA's future intentions to perfect a lien on the property.
The MDI Site in Houston, Texas is located two miles east of downtown and is near an environmental justice community. EPA
and the Department of Justice worked with the bankruptcy trustee to ensure that the purchaser of the site committed to perform
the on-site cleanup work. This was the first settlement through which a BFPP agreed to perform the cleanup work at a
Superfund site.
Both of these liens can be released or waived upon satisfaction before the purchase of the site. The satisfaction
amount may be negotiated with EPA and would be embodied in a settlement agreement. EPA may seek cash
consideration, performance of work, or a combination of such consideration in connection with the lien releases
and waivers. Because EPA liens affect the total value of the property, lien settlement negotiations may need to
include EPA, the current property owner, and the BFPP. Often the liens can be resolved or settled concurrently
because both the Superfund Lien and the Windfall Lien draw from the same available equity in a property. In
addition, EPA may also issue a status/comfort letter to prospective purchasers or their lenders to describe the
status of any EPA liens.
EPA has issued guidance, a model settlement document, and a sample comfort/status letter on Windfall Liens
that can be found on EPA's Web site at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/interim-windfall-lien.pdf
A FAQs fact sheet on Windfall Liens is available on EPA's Web site at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/interim-windfall-lien-faq.pdf
9. COULD I ENCOUNTER PROBLEMS WHEN I TRY To GET FINANCING To BUY SITE
PROPERTY OR BORROW FOR IMPROVEMENTS AND How CAN EPA HELP?
CHANGES TO THE FEDERAL SUPERFUND LAW ADDRESSED MANY LENDER CONCERNS, BUT PROSPECTIVE
PURCHASERS MIGHT STILL EXPERIENCE PROBLEMS. In the past, lenders were reluctant to provide financing for
the purchase of federal Superfund sites because of concerns about:
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Top 10 Questions to Ask When Buying a Superfund Site
lender liability
potential liability of the owner affecting the owner's
ability to repay the loan and
the impact of the contamination on the value of the site
property that secures the loan
These concerns are diminishing for several reasons. A 1996
amendment to the federal Superfund law protects lenders from
federal Superfund liability when the lenders comply with certain
statutory requirements. In particular, the lenders may not
participate in the management of the facility.
The Town of Londonderry, New Hampshire has
experienced an upsurge in economic activity with
the redevelopment of the Tinkham Garage site.
Use of environmental insurance policies has increasingly
alleviated lenders' concerns about financial risks at federal
Superfund sites. The passage of time and increased reuse of
brownfields and federal Superfund sites are demonstrating to lenders the significant financial value that these
properties have and the potentially low risks of financing their purchase and redevelopment.
In addition, the 2002 amendments to the federal Superfund law which provide for BFPP status for new buyers
may provide assurance to lenders because borrowers will not be liable and their ability to repay the lender will
not be affected.
EPA has many tools to help alleviate lenders' concerns about financing contaminated properties, including
guidance documents, comfort/status letters, BFPP work agreements, and Ready for Reuse Determinations.
EPA's willingness to work with buyers and their lenders makes the acquisition of federal Superfund properties
more feasible than ever before.
10. WHAT CAN EPA Do To HELP A PROSPECTIVE PURCHASER DECIDE, AND CONVINCE
LENDERS, TENANTS, AND OTHERS, THAT BUYING AND RE-USING A SUPERFUND SITE IS
A GOOD IDEA?
EPA HAS TOOLS THAT CAN BE USED TO DEMONSTRATE THAT BUYING OR USING A FEDERAL SUPERFUND SITE
CAN BE A GOOD OPPORTUNITY. Some of these tools include:
BFPP 'Doing Work' Agreements - EPA may enter into
a settlement agreement with a BFPP who wishes to
perform part or all of a cleanup. The agreement provides
for EPA oversight and may satisfy part or all of any
windfall lien.
Lien Settlements - EPA is willing to enter into
negotiations and settlement agreements to resolve lien
issues and facilitate reuse.
Status/Comfort Letters - EPA may issue status letters or
comfort letters that address the following:
o status of the site
o future anticipated actions at the site
o available liability protections
The Town of Arlington, Tennessee acquired the
Arlington Blending & Packaging site in 2004 after
EPA issued a comfort letter and Ready for Reuse
Determination. Today the site is an active
neighborhood park.
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Top 10 Questions to Ask When Buying a Superfund Site
o reasonable steps that a purchaser should take to stop any on-going releases and prevent future
releases at sites where EPA has enough information about the site to make suggestions as to
such steps and
o the status of EPA liens
Ready for Reuse Determinations - EPA may also issue a Ready for Reuse Determination to affirm that
the site's conditions are protective of human health and the environment for specified uses.
Discussions - EPA Regional staff are often willing to talk with or meet with a prospective purchaser,
sellers, lenders, and other stakeholders to discuss the issues critical to the successful purchase and reuse
of a federal Superfund site. Providing examples of other federal Superfund sites that were successfully
redeveloped and are now in reuse can also reassure local citizens and stakeholders of revitalization
opportunities.
Partial Deletions - While total cleanup of a site may take many years, many sites on the National
Priorities List include portions that have been cleaned up and may be available for productive use.
These portions may be partially deleted from the National Priorities List if EPA makes a determination
that no further response work is required, the state concurs, and necessary institutional controls are in
place. Any person, including individuals, businesses, entities, states, local governments, and other
Federal agencies, may submit a petition requesting a partial deletion. A partial deletion of a portion of a
site from the National Priorities List can help to increase the site's marketability. Please note: EPA
Superfund liens may still apply to the deleted parcel. For more information on partial deletions visit
http://www.epa.gov/superfund/action/postconstruction/deletion.htm.
Site Reuse Fact Sheets - The Superfund Redevelopment Initiative Web site at
http://www.epa.gov/superfund/programs/recycle/ provides summary information about federal
Superfund sites that have been reused. Detailed fact sheets for some sites are also available and may
include data on economic impacts and environmental and social benefits resulting from the reuse of
federal Superfund sites.
Information about many of these tools can also be found on EPA's Cleanup Enforcement Web site at
http://www.epa.gov/compliance/cleanup/redevelop/landowner.html.
Disclaimer: This document is provided solely as general information to highlight certain aspects of a more
comprehensive program. It does not provide legal advice, have any legally binding effect, or expressly or
implicitly create, expand, or limit any legal rights, obligations, responsibilities, expectations, or benefits for any
person. This document is not intended as a substitute for reading the statute or the guidances described above.
It is the prospective purchaser's sole responsibility to ensure that its proposed use does not interfere with or
impede the site's remedy or protectiveness. EPA does not offer any guarantees or warranties as to the
compatibility of a proposed use with the cleanup remedy. It is also the purchaser's sole responsibility to
maintain liability protection status as a bona fide prospective purchaser.
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CERCLA Liability and Local Government
Acquisitions and Other Activities
-------
Environmental Protection
United States Office of Enforcement and March 2011
Environmental Protection Agency Compliance Assurance EPA-330-F-11-003
CERCLA Liability and Local
^^ . ....
Government Acquisitions
and Other Activities
Office of Site Remediation Enforcement
Local governments can play an important role in facilitating the cleanup and redevelopment of
properties contaminated by hazardous substances. In particular, by acquiring contaminated
properties, local governments have an opportunity to evaluate and assess public safety needs and
promote redevelopment projects that will protect and improve the health, environment, and
economic well-being of their communities.
One impediment to local government acquisition of contaminated property is concern about
potential liability for the cleanup costs under the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, also known as "Superfund" or "CERCLA," 42 U.S.C.
§§ 9601-9675.
This fact sheet addresses CERCLA liability issues for local governments and summarizes key
statutory provisions and requirements.1 It is intended to assist local governments by identifying
CERCLA liability issues and protections that may be applicable to local governments as they
consider involvement at contaminated properties.
The U.S. Environmental Protection Agency (EPA) recommends that local governments refer to
the statutory language of CERCLA, the regulations at 40 C.F.R. Part 300 (known as the
"National Contingency Plan"), and relevant EPA guidance (referenced at the end of this
document) for more detail. EPA's Regional offices2 also may be able to provide information and
assistance to local governments considering acquisition of contaminated properties. EPA also
encourages local governments to consult with their state environmental protection agency and
legal counsel prior to taking any action to acquire, cleanup, or redevelop contaminated property.
What is CERCLA?
CERCLA outlines EPA's authority for cleaning up properties contaminated with hazardous
substances regardless of whether the properties are in use or abandoned. Additionally, CERCLA
establishes a strict liability system for determining who can be held liable for the costs of
cleaning up contaminated properties. CERCLA also provides EPA with robust enforcement
1 A local government also may have obligations and/or be potentially liable under other environmental statutes such
as the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901-6992 (RCRA) or state laws.
2 For contact information, see http://www.epa.gov/aboutepa/postal.htmMregional.
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authorities to compel cleanups and recover EPA's response and enforcement costs incurred at
these properties. Properties addressed under CERCLA authorities are commonly known as
"Superfund sites."
CERCLA also includes authority for EPA to provide grant funding for the assessment and
cleanup of brownfield sites. CERCLA § 101(39)(A) defines a brownfield site as "real property,
the expansion, redevelopment, or reuse of which may be complicated by the presence or
potential presence of a hazardous substance, pollutant, or contaminant." Many of the properties
that local governments may be interested in acquiring may qualify as brownfield sites.
For more general information about, and an overview of, CERCLA, please see EPA's website at
http://www.epa.gov/superfund/policy/cercla.htm.
What are the various ways local governments become involved at
contaminated properties?
Local governments may become involved with contaminated properties in a number of ways,
many of which present opportunities to facilitate cleanup or redevelopment. The ways include:
Providing incentives to promote redevelopment (i.e., zoning, tax increment financing,
etc.);
Responding to an emergency on the property;
Transferring of tax liens;
Collaborating with the current property owner;
Leasing of the property by the municipality;
Acquiring the property and "simultaneously" transferring it to a third party;
Acquiring the property with subsequent transfer to a third party;
Acquiring the property and managing it through a "land bank"; or
Acquiring the property for long-term use.
Can a local government be liable under CERCLA?
Yes. CERCLA is a strict liability statute that holds potentially responsible parties (PRPs) jointly
and severally liable, without regard to fault, for cleanup costs incurred in response to the release
or threatened release of hazardous substances. Under CERCLA § 107, a person, including a
local government, may be considered a PRP3 if the person:
Is the current owner or operator of the contaminated property;
Owned or operated the property at the time of the disposal of the hazardous substance;
Arranged for the hazardous substances to be disposed of or treated, or transported for
disposal or treatment; or
Transported the hazardous substances to the property.
1 According to CERCLA, federally recognized tribes are not included as PRPs.
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A local government that falls into one of the classes of PRPs described above may be potentially
liable under CERCLA. Fortunately, CERCLA includes liability exemptions, affirmative
defenses, and protections that may apply to local governments. Additionally, EPA has
enforcement discretion guidance and site-specific tools that may address concerns about
potential CERCLA liability.
Is a local government liable under CERCLA if it responds to an emergency on
a contaminated property?
Local units of government, especially fire, health, and public safety departments, are often the
first responders to emergencies and other dangerous situations at contaminated properties in their
communities. So as not to interfere with these activities, CERCLA § 107(d)(2) provides that
state or local governments will not be liable for "costs or damages as a result of actions taken in
response to an emergency created by a release or threatened release of a hazardous substance by
or from property owned by another party." Note: This protection does not apply in cases where
the local government is grossly negligent or intentionally engages in misconduct. CERCLA §
107(d)(2). Negligence and intentional misconduct are fact-specific determinations.
In addition, CERCLA § 123 authorizes EPA to reimburse local governments for the costs of
temporary emergency measures taken in response to releases within their jurisdiction. These
temporary measures must be "necessary to prevent or mitigate injury to human health or the
environment associated with the release or threatened release of any hazardous substance,
pollutant, or contaminant." This reimbursement is to give financial assistance to government
entities that do not have a budget allocated for emergency response and cannot otherwise provide
adequate response measure. The amount of the reimbursement may not exceed $25,000 for a
single response.
For more information on CERCLA § 123 reimbursements, please see EPA's website at
http://www.epa.gov/ceppo/web/content/lawsregs/lgrover.htm.
What CERCLA liability protections are available to local governments if they
acquire contaminated property?
CERCLA contains liability exemptions, affirmative defenses, and protections which may apply
to a local government when it:
Acquires contaminated property involuntarily by virtue of its function as a sovereign,
CERCLA § 101(20)(D);
Qualifies for a third party defense or innocent landowner liability protection, CERCLA
§§ 107(b)(3), 101(35)(A);
Qualifies as a bona fide prospective purchaser (BFPP) when it acquires the
contaminated property, CERCLA §§ 101(40), 107(r)(l); or
Is conducting or has completed a cleanup of a contaminated property in compliance
with a state cleanup program, CERCLA § 128(b).
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Each of these is discussed below in further detail.
Key CERCLA Provisions
- Could apply to local
governments
o - Could apply to local
governments under
certain circumstances
Involuntary Acquisition
§101(20)(D)
Bona Fide Prospective
Purchaser Protection
§§ 101(40) and 107(r)(l)
Third Party and
Innocent Landowner
Defenses
§§ 107(b)(3) and
101(35)(A)
Enforcement Bar
§128(b)
Methods of Property Acquisition
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The method or type of property acquisition by a local government will play a critical role in the
application of liability exemptions, affirmative defenses, or protections. Although most often
applied in the purchase and gift/donation context, BFPP status is available for the majority of
property acquisitions. Note: In cases where it is unclear whether the involuntary acquisition
exemption, affirmative defenses, or liability protections are sufficient, EPA encourages the local
government to achieve and maintain BFPP status to increase certainty that it will not be liable
under CERCLA.
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What is the meaning of "involuntary acquisition"?
CERCLA § 101(20)(D)4 provides that a unit of state or local government will not be considered
an owner or operator of contaminated property (and thus is exempt from potential CERCLA
liability as a PRP) if the state or local government acquired ownership or control involuntarily.
This provision includes a non-exhaustive list of examples of involuntary acquisitions, including
obtaining property through bankruptcy, tax delinquency, abandonment, or "other circumstances
in which the government entity involuntarily acquires title by virtue of its function as sovereign."
However, it is important to note that this exemption will not apply to any state or local
government that caused or contributed to the release or threatened release of a hazardous
substance from the facility.
For purposes of EPA enforcement, EPA considers an involuntary acquisition or transfer to
include situations "in which the government's interest in, and ultimate ownership of, a specific
asset exists only because the conduct of a non-governmental party.. .gives rise to a statutory or
common law right to property on behalf of the government." Moreover, EPA acknowledges
that tax foreclosure and other acquisitions by government entities often require some affirmative
or volitional act by the local government.6 Therefore, a government entity does not have to be
completely passive during the acquisition in order for the acquisition of property to be
considered involuntary under CERCLA.7 Instead, EPA considers an acquisition to be
involuntary if the government's interest in, and ultimate ownership of, the property exists only
because the actions of a non-governmental party give rise to the government's legal right to
control or take title to the property. For example, although a local government might be required
to engage in certain discretionary or volitional actions to acquire title to a property through tax
delinquency foreclosure or abandonment per state statute, EPA would consider the acquisition
involuntary.8
For more information on state and local government involuntary acquisition, please see EPA's
website at http://www.epa.gov/compliance/cleanup/revitalization/local-acquis.html.
How does a local government become a bona fide prospective purchaser
(BFPP)?
A local government, whose potential liability is based solely on the fact that it knowingly
purchased a contaminated property and is, therefore, considered the current owner or operator,
will not be liable under CERCLA if it achieves and maintains BFPP status. BFPP status may be
4
CERCLA § 101(35)(A)(ii) also discusses involuntary acquisitions for a unit of state or local government in the
context of the innocent landowner defense pursuant to CERCLA § 101(35)(A).
5 Municipal Immunity from CERCLA Liability for Property Acquired through Involuntary State Action
(EPA/OSRE/OSWER, 10/20/1995) at 3.
6 Mat 4.
1 Id.
8 Id.
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achieved even when the buyer has knowledge of the contamination on the property at the time of
purchase. Moreover, EPA encourages local governments to achieve and maintain BFPP status in
cases where it is unclear whether involuntary acquisition, affirmative defenses, or other liability
protections may be sufficient to avoid CERCLA liability.
CERCLA §§ 101(40) and 107(r)(l) provide that a BFPP is a person or tenant of a person who
acquired the property after January 11, 2002 and meets the following threshold criteria:
All Appropriate Inquiries (AAI) were performed prior to purchase of the property
pursuant to CERCLA § 101(35)(B);
All disposal of hazardous substances occurred before the party acquired the property;
and
The party has "no affiliation" with a liable or potentially liable party.
CERCLA §§ 101(40)(C)-(G) provide additional criteria for maintaining BFPP status. These
continuing obligations that must be met after acquisition of the property include:
Complying with land use restrictions and not impeding the effectiveness of the
institutional controls;
Taking "reasonable steps" to prevent the release of hazardous substances. These
obligations are site-specific, but may include preventing threatened future releases
and/or limiting exposure to earlier hazardous substance releases. Institutional controls,
discussed further below, may play a critical role in complying with reasonable steps;
Providing full cooperation, assistance and access;
Complying with information requests and administrative subpoenas; and
Providing legally-required notices.
To remain protected from CERCLA liability for the existing contamination while it owns the
property, a local government must maintain its BFPP status for as long as the potential for
liability exists. Potential liability exists for as long as contamination remains on the property
and/or the statute of limitations on CERCLA cost recovery actions is not in effect. It is
important to note that a local government may become liable for any new contamination that
may occur, even if the statute of limitations has run on existing contamination.
Although a BFPP is not liable for the cost of cleaning up the property, the property itself could
be subject to a "windfall lien"9 if EPA has spent money cleaning up the property after the BFPP
acquires it and EPA's cleanup efforts have increased the fair market value of the property.
CERCLA § 107(r)(2). The windfall lien is limited to the lesser of EPA's unrecovered response
costs or the increase in fair market value attributable to EPA's cleanup. EPA may be able to file
a windfall lien on the property if:
EPA spent money cleaning up the property before acquisition by a BFPP if certain
requirements are met (i.e., where there are substantial unreimbursed costs);
EPA's response action results in a significant increase in the property's fair market value;
There are no viable, liable parties from whom EPA could recover its costs; and
9 CERCLA contains two sections which discuss the ability of the federal government to impose liens. This fact
sheet addresses the windfall provision of CERCLA § 107(r), but will not discuss liens provided under CERCLA §
107(1).
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A response action occurs while the property is owned by a person who is exempt (other
than a BFPP) from CERCLA liability.
Whether EPA will perfect a windfall lien and prevent a potential windfall in such instances will
be determined by site-specific circumstances and the equities of the particular situation.
For more information on AAI, please see EPA's website at http://www.epa.gov/brownfields/
aai/index.htm. For more information on the BFPP liability protection and/or windfall liens,
please see EPA's website at http://www.epa.gov/compliance/cleanup/revitalization/bfpp.html.
What are the requirements for the third party defense or innocent landowner
defense?
CERCLA § 107(b)(3) provides a "third party" affirmative defense to CERCLA liability for any
owner, including local governments, that can prove, by the preponderance of the evidence, that
the contamination was caused solely by the act or omission of a third party whose act or
omission did not occur "in connection with a contractual relationship." Moreover, an entity
asserting the CERCLA § 107(b)(3) defense must show that: a) it exercised due care with respect
to the contamination; and b) it took precautions against foreseeable acts or omissions, and the
consequences thereof by the third party that caused the contamination.
Congress enacted the Brownfields Amendments10 and expanded the third party defense by
creating exclusions to the definition of a contractual relationship. Previously, the deed
transferring title between a PRP and the new landowner was a "contractual relationship" that
prevented the new landowner from raising the traditional CERCLA § 107(b)(3) third party
defense. To promote redevelopment and provide more certainty, Congress also clarified the
"innocent landowner defense," which requires an entity to meet the criteria set forth in CERCLA
§ 101(35), in addition to the requirements of CERCLA § 107(b)(3). CERCLA § 101(35)(A)
distinguishes three types of innocent landowners:
Purchasers who acquire property without knowledge of contamination, CERCLA §
Governments "which acquired the facility by escheat, or through any other involuntary
transfers or acquisition, or through the exercise of eminent domain authority by
purchase or condemnation," CERCLA § 101(35)(A)(ii); and
Inheritors of contaminated property, CERCLA § 101(35)(A)(iii).
For more information on qualifying for the innocent landowner defense where the purchaser
acquired property without knowledge of the contamination, please see EPA's Interim Guidance
Regarding Criteria Landowners Must Meet in Order to Qualify for Bona Fide Prospective
Purchasers, Contiguous Property Owner, or Innocent Landowner Limitations on CERCLA
Liability (Common Elements Guidance) available at
http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-guide.pdf.
10 Small Business Liability Relief and Brownfields Revitalization Act (Pub. L. No. 107-118)(hereinafter the
"Brownfields Amendments").
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How do state response programs interact with CERCLA's enforcement bar?
Many states have established state-specific response programs (for example, State Superfund,
brownfields, and voluntary cleanup programs). These programs play a critical role in assessing
and cleaning up the vast majority of our nation's brownfields and other lower-risk sites. EPA
supports state response programs through:
Grant funding to establish and enhance state programs; and
Non-binding Memoranda of Agreement with individual states that provide general
enforcement assurances to encourage assessments and cleanups pursuant to a state
response program.
CERCLA § 128(b) protects local governments and other parties from EPA enforcement, subject
to specific exceptions, when they comply with a state response program and are conducting or
have completed a cleanup of an eligible response site, as defined by CERCLA § 101(41). This
protection is known as the "enforcement bar." EPA has entered into non-binding Memoranda of
Agreement with over 20 states which clarify EPA enforcement intentions under CERCLA at
sites addressed in compliance with state response programs. It is important to note that while
CERCLA § 128(b) may prohibit EPA from taking an enforcement action; it does not preclude
third party litigation.
For more information about state voluntary cleanup programs and Memoranda of Agreement,
please see EPA's website at http://www.epa.gov/compliance/cleanup/revitalization/state.html.
What should a local government do if it obtains contaminated property from
a land bank or redevelopment authority?
EPA recognizes the importance and increased use of land banks and redevelopment agencies as a
tool to address abandoned or vacant properties, promote smart growth, improve existing land use
practices, and support local community development. In an effort to make greater use of these
tools, an increasing number of states and local governments are passing legislation creating land
banks or redevelopment authorities to acquire, redevelop, and reuse abandoned properties.
While many abandoned properties that are of interest to land banks and redevelopment
authorities are not likely to be contaminated, local governments should be aware that
contamination and potential CERCLA liability may exist. A local government may increase the
likelihood that the land bank or redevelopment authority is eligible for CERCLA liability
protection by ensuring that the land bank or redevelopment authority conducts AAI prior to
acquiring the property. Not only is AAI a critical requirement for obtaining most CERCLA
landowner liability protections, but it also aids local governments in making informed property
acquisition decisions. When acquiring abandoned contaminated properties, EPA encourages
local governments to obtain BFPP status prior to acquisition if it is unclear whether other
exemptions, affirmative defenses, or liability protections may apply.
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How does CERCLA liability affect eligibility for federal brownfields grant
funding?
EPA brownfields grant money is available to
eligible entities as defined by CERCLA § 104(k)(l).
However, these funds cannot be used to pay
response costs at a brownfield site for which the
grantee is potentially liable under CERCLA § 107.
If an applicant for brownfields grant money may be
potentially liable at the site for which they are
seeking funds, they must document that they qualify
for one of CERCLA's liability protections.
Therefore, one benefit of being covered by a
CERCLA liability protection is that it enables
certain non-liable entities to be potentially eligible
for federal brownfields grant funding. If a local
government intends to protect itself against
CERCLA liability and compete for federal
brownfields grant funding, it is advisable for the
local government to evaluate whether it is eligible
for a grant or become eligible through a liability
protection before acquiring a brownfield site.
For more information about obtaining an EPA
brownfields grant, grant guidelines, and discussions
about the various types of grants that are available, please see EPA's website at
http://www.epa.gov/brownfi elds/grant_info/index.htm.
TYPES OF BROWNFIELDS FUNDING
OPPORTUNITIES
CERCLA §§ 104(k)(4) and (6) authorize
EPA's Brownfields Program to provide
funding in a variety of ways:
Assessment Grants
Cleanup Grants
Revolving Loan Fund Grants
Job Training Grants
Training, Research, and
Technical Assistance Grants
Targeted Brownfields
Assessments
Area-Wide Planning Pilot
Program
What protections exist when municipal solid waste is disposed of at a
contaminated property?
Prior to the Brownfield Amendments, entities that disposed of municipal solid waste at
contaminated properties argued that they should not be liable for the cleanup of contamination
that was originally and primarily caused by industrial polluters. To address this issue, the
Brownfield Amendments included CERCLA § 107(p) to create a qualified exemption from
CERCLA liability for certain residential, small business, and non-profit generators of municipal
waste at sites on CERCLA's National Priorities List. However, this exemption does not apply to
municipalities who owned or operated a site.
For more information on the municipal solid waste exemption and EPA's guidance on the
exemption, please see EPA's website at http://www.epa.gov/compliance/resources/
policies/cleanup/superfund/interim-msw-exempt.pdf
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What steps might a local government take at a contaminated property to
protect human health and the environment and ensure the integrity of a
cleanup?
When contamination remains on a property during or
after cleanup activities, institutional controls may be
used alone or in combination with engineered
controls to ensure protection of human health and the
environment. Generally, institutional controls are
designed to limit land or resource use (e.g.,
prohibitions on residential use or extraction of ground
water) and to ensure the integrity of engineered
controls (e.g., restrictions on excavating soils on or in
the vicinity of a landfill cap).
As with engineered controls, institutional controls
must be maintained, monitored, and evaluated for as
long as contamination remains on the property at
levels that do not allow for unrestricted use and
unlimited exposure.
WHAT IS AN
INSTITUTIONAL CONTROL?
An institutional control is a legal or
administrative restriction on the
use of, or access to, a contaminated
property to protect:
1) the health of both humans and
the environment; and
2) ongoing cleanup activities and
to ensure viability of the
engineered controls.
There are four categories of institutional controls:
Proprietary Controls (e.g., easement, real covenant, statutory covenant)
Governmental Controls (e.g., zoning, building permit, land use ordinance)
Enforcement and Permit Tools (e.g., consent decree, permit, order)
Informational Devices (e.g., deed notice, government advisory, state registry)
Whether or not a local government asserts BFPP status, it may play a key role in implementing,
monitoring, and enforcing certain institutional controls - particularly for those it has the legal
authority to implement or enforce. A local government also may work proactively with
developers, prospective buyers and tenants, and other parties to ensure that institutional control
requirements are understood and properly integrated into the planning and future reuse of the
property.
If institutional controls are already in place on a particular property, it is important for local
governments to understand the obligations the institutional controls impose and to consider how
those obligations might be viewed by future owners, developers and property users. In some
situations, EPA or the state may be willing to modify existing institutional controls to facilitate
the appropriate reuse of the property as long as the engineered controls component of the cleanup
will not be compromised and remains protective of human health and the environment.
For more information about institutional controls issues, please see EPA's website at
http://www.epa.gov/superfund/policy/ic/index.htm.
10
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^RCLA Liability and Local Government Acquisition of
Contaminated Property:
Key Documents
Local
Government
Issue
CERCLA
Provision
Relevant EPA Documents or Guidance (if
Involuntary § 101(20)(D) Policy on Interpreting CERCLA Provisions Addressing Lenders and
Acquisition Involuntary Acquisitions by Government Entities (EPA/OSRE, 6/30/1997)
Policy on CERCLA Enforcement Against Lenders and Government Entities
that Acquire Property Involuntarily (EPA/DOJ, 9/22/2005)
Municipal Immunity from CERCLA Liability for Property Acquired
through Involuntary State Action (EPA/OSRE/OSWER, 10/20/1995)
Fact Sheet: The Effect of Superfund on Involuntary Acquisitions of
Contaminated Property by Government Entities (EPA/OSRE, 12/31/1995)
Third Party §§ 107(b)(3),
and Innocent 101(35)(A)(ii)
Landowner
Defenses
Interim Guidance Regarding Criteria Landowners Must Meet in Order to
Qualify for Bona Fide Prospective Purchasers, Contiguous Property Owner,
or Innocent Landowner Limitations on CERCLA Liability ("Common
Elements") (EPA/OSRE, 3/6/2003)
Bona Fide § 101(40) and Interim Guidance Regarding Criteria Landowners Must Meet in Order to
Prospective § 107(r) Qualify for Bona Fide Prospective Purchasers, Contiguous Property Owner,
Purchaser or Innocent Landowner Limitations on CERCLA Liability ("Common
Elements") (EPA/OSRE, 3/6/2003)
Issuance of CERCLA Model Agreement and Order on Consent for Removal
Action by a Bona Fide Prospective Purchaser (OSRE/USDOJ, 11/27/2006)
Enforcement Discretion Guidance Regarding the Applicability of the Bona
Fide Prospective Purchaser Definition in CERCLA § 101(40) to Tenants
(OSRE/OSWER, 1/19/2009)
Enforcement Discretion Guidance Regarding the Applicability of the Bona
Fide Prospective Purchaser Definition in CERCLA Section 101(40) to
Tenants: Frequently Asked Questions (OSRE, 11/1/2009)
Windfall
Liens
§ 107(r)
Interim Enforcement Discretion Policy concerning Windfall Liens Under
Section 107(r) of CERCLA (EPA/DOJ, 7/16/2003)
Windfall Lien Guidance: Frequently Asked Questions (OSRE, 4/1/2008)
Windfall Lien Administrative Procedures (OSRE, 1/8/2008)
11
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Local
Government CERCLA
Issue Provision
Brownfield
Grants
§ 104(k)(4) and
(6)
Relevant EPA Documents or Guidance (if any)
Brownfields Assessment Pilot/Grants at
http://epa.gov/bro wnfields/assessment_grants.htm
Revolving Loan Fund Pilot/Grants at http://epa.gov/brownfields/rlflst.htm
Cleanup Grants at http://epa.gov/brownfields/cleanup_grants.htm
Area-Wide Planning Pilot Program at
http://www.epa.gov/bro wnfields/areawide_grants.htm
Brownfield Grant Guidelines Frequently Asked Questions at
http://www.epa.gov^ownfields/proposal_guides/faqpguid.htm
Institutional
Controls
§§ 101(40)(F),
Institutional Controls: A Citizen's Guide to Understanding Institutional
Controls at Superfund, Brownfields, Federal Facilities, Underground
Storage Tank, and Resource Conservation and Recovery Act Cleanups
(EPA/OSWER, 2/2005)
Institutional Controls: A Guide to Implementing, Maintaining, and
Enforcing Institutional Controls at Contaminated Sites (EPA Interim Final
Draft 11/2010)
Institutional Controls: A Site Manager's Guide to Identifying, Evaluating
and Selecting Institutional Controls at Superfund and RCRA Corrective
Action Cleanups (EPA/OSWER, 9/2000)
State
Voluntary
Cleanups and
Memoranda
of Agreement
§§ 101(41), To see state-specific voluntary cleanup programs Memoranda of
128 Agreement, please see
http://www.epa.gov^owrrfields/state_tribal/moa_mou.htm
Contact Information
If you have any questions about this fact sheet, please contact Cecilia De Robertis of EPA's
Office of Site Remediation Enforcement at 202-564-5132 or derobertis.cecilia@epa.gov.
Disclaimer: This document is provided solely as general information to highlight certain
aspects of a more comprehensive program. It does not provide legal advice, have any legally
binding effect, or expressly or implicitly create, expand, or limit any legal rights, obligations,
responsibilities, expectations, or benefits for any person. This document is not intended as a
substitute for reading the statute or the guidance documents described in this document. It is the
local government's sole responsibility to ensure that it obtains and retains liability protections.
EPA does not offer any guarantees or warranties for or related to acquisition of a contaminated
property or formerly contaminated property. It is also the local government's sole responsibility
to maintain liability protection status as a contiguous property owner, bona fide prospective
purchaser, or innocent land owner.
12
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Brownfields Enforcement and Land Revitalization
Policy and Guidance Documents
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Brownfields Enforcement and Land Revitalization
Policy and Guidance Documents
The following documents are available on the cleanup enforcement website at
http://www.epa.gov/compliance/cleanup/revitalization/index.html.
ALL APPROPRIATE INQUIRIES
Final rule detailing the standards and practices for all appropriate inquiries (AAI). The rule establishes specific
regulatory requirements and standards for conducting AAI into the previous ownership and uses of a property for the
purposes of meeting the AAI provisions necessary to qualify for certain landowner liability protections under
Superfund. The standards and practices also will be applicable to persons conducting site characterization and
assessments with the use of grants awarded by EPA.
To access online: http://www.epa.gov/brownfields/aai/index.htm.
BONA FIDE PROSPECTIVE PURCHASER (BFPP)
Provides guidance on how EPA intends to exercise its enforcement discretion with regard to the bona fide
prospective purchaser provision. Specifically, it recognizes the important role that leasehold interests play in
facilitating the cleanup and reuse of brownfields and other contaminated properties.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/bfpp-tenant-
mem.pdf
Provides general information regarding the common elements of the landowner liability protections contained in the
2002 Brownfields Amendments to Superfund. These common elements include the requirements of "all appropriate
inquiry" (AAI), demonstrating no affiliation with a liable party, and continuing obligations.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-
guide.pdf
Highlights the main points made in EPA's March 2003 "Common Elements" guidance document concerning the
conditional liability provided to bona fide prospective purchasers, contiguous property owners, and innocent
landowners by the 2002 Brownfield Amendments. The document focuses on the shared factors required to qualify
for the above Superfund liability protections.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-
ref.pdf
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Provides a model agreement and order on consent for those bona fide prospective purchasers (BFPP) who are
required to perform a removal action. This model addresses those situations where there is a federal interest or
where the work is complex or significant in extent, such as where EPA will oversee the removal action or where the
removal work will exceed the "reasonable steps to prevent releases" obligation upon which BFPP status depends.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/bfpp-ra-mem.pdf
Describes when EPA will consider providing a bona fide prospective purchaser (BFPP) with a liability limitation
despite having knowledge of contamination pursuant to changes made to the Superfund statute by the 2002
Brownfield Amendments. The Amendments list certain requirements that must be met to achieve BFPP status, dis-
pense with the prior need for Prospective Purchaser Agreements (PPA) (except in limited circumstances), and
provide for EPA's recovery of any windfall that a purchaser may receive.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/bonf-pp-cercla-
mem.pdf
BROWNFIELDS GRANTS
Provides background information on the definition of an eligible response site, how the regions make a
determination of whether a site fits this definition, and what the implications of this determination are. This
document also provides the regions with guidance for making these determinations in conjunction with future site
assessment decisions and for sites with past site assessment determinations.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/reg-determ-small-
bus-mem.pdf
COMFORT LETTERS
Discusses EPA and the Department of Justice's (DOJ) interim policy implementation of the new CERCLA 107(r)
windfall lien provision contained in the 2002 Brownfields Amendments. This document lists the factors that EPA
will use to determine whether to file a lien, in addition to discussing how EPA will settle the liens and the possibility
of EPA issuing comfort letters to or making agreements with bona fide prospective purchaser (BFPPs).
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/interim-windfall-
lien.pdf
Provides general information regarding the common elements of the landowner liability protections contained in the
2002 Brownfields Amendments to Superfund. These common elements guidance includes a discussion of the
reasonable steps letter.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-
guide.pdf
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To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-
ref.pdf
Addresses the use of comfort/status letters at Resource Conservation and Recovery Act (RCRA) properties, where
the letters may facilitate the cleanup and reuse of brownfield sites, where there exists a real probability or perception
that EPA may initiate a cleanup, or where there is no other adequate mechanism to assuage a party's concerns. This
document also includes four sample letters.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/rcra/comfort-rcra-brwn-
mem.pdf
Discusses EPA's policy on the use of comfort/status letters to provide the recipient party with any releasable
information that EPA has pertaining to a property, as well as interpret what the information means and the likelihood
or current plans for EPA to undertake any Superfund action. A letter is used in order to facilitate the cleanup and
redevelopment of a brownfield site if there is a realistic perception or probability of incurring liability or if there is
no other mechanism available to address the recipient's concerns. This document also contains four sample
comfort/status letters.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/comfort-let-
mem.pdf
CONTAMINATED AQUIFERS
Details EPA's position concerning owners of property that contains an aquifer that has become contaminated as a
result of subsurface migration. In certain circumstances, EPA will not take enforcement action against a landowner
whose property has become contaminated through subsurface migration through no fault of their own, their agent, or
their employee. In addition, EPA may consider de minimis settlements which would protect the landowner from
contribution suits.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/contamin-aqui-
rptpdf
CONTIGUOUS PROPERTY OWNERS
This memorandum discusses and transmits a model contiguous property owner assurance letter to be used in
accordance with a January 2004 interim guidance regarding contiguous property owners.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/cpo-assure-mod-ltr-
mem.pdf
The reference sheet summarizes the important points and requirements of the January 13, 2004 guidance document
"Interim Enforcement Discretion Guidance Regarding Contiguous Property Owners," which addresses liability
limitations.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/contig-prop-
faq.pdf
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Addresses the addition of liability protection to contiguous property owners to Superfund by the 2002 Brownfields
Amendments. The document discusses the criteria property owners need to meet, how the Amendments apply to
current and former owners, the relationship between the Amendments and EPA's Residential Homeowner Policy
and Contaminated Aquifers Policy, and mechanisms that EPA may use to resolve landowner liability concerns.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/contig-prop.pdf
Provides general information regarding the common elements of the landowner liability protections contained in the
2002 Brownfields Amendments to Superfund. These common elements include the requirements of "all appropriate
inquiry" (AAI), demonstrating no affiliation with a liable party, and continuing obligations.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-
guide.pdf
Highlights the main points made in EPA's March 2003 "Common Elements" guidance document concerning the
conditional liability provided to bona fide prospective purchasers, contiguous property owners, and innocent
landowners by the 2002 Brownfield Amendments. The document focuses on the shared factors required to qualify
for the above Superfund liability protections.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-
ref.pdf
DE MICROMIS
Provides a revision to EPA and DOJ's policy regarding settlements with de micromis parties at Superfund sites in
light of the codification of this policy in the 2002 Brownfields Amendments. This document also revises the model
contribution waiver language that has been used in CERCLA agreements to waive private contribution claims
against parties that contributed only very small amounts of waste. In addition, this document contains five attach-
ments of model language.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/wv-exmpt-
dmicro-mem.pdf
ENVIRONMENTALLY RESPONSIBLE, REDEVELOPMENT & REUSE
Provides a list of frequently asked questions and answers regarding EPA's Environmentally Responsible,
Redevelopment and Reuse (ER3) Initiative. This program seeks to encourage redevelopment in a sustainable way
that prevents future environmental hazards through incentives, assistance, and education.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/er3-faas-05.pdf
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INNOCENT LANDOWNERS
Provides general information regarding the common elements of the landowner liability protections contained in the
2002 Brownfields Amendments to Superfund. These common elements include the requirements of "all appropriate
inquiry" (AAI), demonstrating no affiliation with a liable party, and continuing obligations.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-
guide.pdf
Highlights the main points made in EPA's March 2003 "Common Elements" guidance document concerning the
conditional liability provided to bona fide prospective purchasers, contiguous property owners, and innocent
landowners by the 2002 Brownfield Amendments. The document focuses on the shared factors required to qualify
for the above Superfund liability protections.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/common-elem-
ref.pdf
INVOLUNTARY ACQUISITION
This fact sheet is intended to be a resource for local governments concerned about incurring potential CERCLA
liability as a result of activities to facilitate cleanup and redevelopment of contaminated properties. Among other
topics, this document addresses involuntary acquisition issues.
To access online: http://www.epa.gov/oecaerth/cleanup/revitalization/local-acquis.html.
Sets forth EPA and DOJ policy regarding the government's enforcement of Superfund against lenders and against
governmental entities that acquire property involuntarily.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/immunitv-cercla-
mem.pdf
Provides EPA and DOJ's policy to adhere to the 1992 "Lender Liability Rule" as official enforcement policy in
order to appropriately contend with those lenders and governmental entities who have acquired contaminated prop-
erty involuntarily.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/cercla-enfinvol-
mem.pdf
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Sets forth EPA's policy on lender and governmental entity involuntary acquisition of contaminated property in light
of the amendments to Superfund as a result of the passage of the Asset Conservation, Lender Liability, and Deposit
Insurance Protection Act of 1996. In addition, this document discusses how these amendments affect EPA's
application of the Lender Liability Rule.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/lendr-aquis-
mem.pdf
Sets forth EPA's policy on Superfund enforcement against government entities that involuntarily acquire
contaminated property. Also describes some types of government actions that EPA believes qualify for a liability
exemption or a defense to Superfund liability.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/fs-involacquprtv-
rptpdf
MUNICIPAL SOLID WASTE
Discusses the qualified liability exemption added to Superfund by the 2002 Brownfields Amendments and provided
to certain residential, small business and non-profit generators of municipal solid waste (MSW) at sites on the
National Priorities List (NPL). This document discusses the criteria to qualify for this exemption, the provisions in
the Amendments meant to deter litigation against exempt parties, and the interaction between this exemption and
existing policies.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/interim-msw-
exemptpdf
PROSPECTIVE PURCHASER AGREEMENTS AND PROSPECTIVE LESSEE AGREEMENTS
Discusses three useful tools for EPA to overcome obstacles in cleanup and reuse of Resource Conservation and
Recovery Act (RCRA) sites:
Prospective Purchaser Agreements (PPA),
the February 2003 "Final Guidance on Corrective Action Activities at RCRA Facilities," and
comfort/status letters. This document also includes the factors used by EPA to evaluate a request for a PPA.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/rcra/memoppa.pdf
Provides guidance to prospective purchasers of contaminated Superfund property, specifically concerning the
expanded circumstances by which purchasers can enter into covenants not to sue with EPA. This document also
provides a model agreement.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/prosper-cont-
mem.pdf
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READY FOR REUSE DETERMINATION
Provides guidance to EPA employees in preparing Ready for Reuse Determinations (RfR) in order to encourage the
reuse of Superfund sites by informing the real estate market of the status of the site subject to the determination. RfR
is an environmental status report that documents a technical determination by EPA, in consultation with the States,
Tribes, and local governments, that all or a portion of a Superfund site can support specified types of uses and
remain protective of human health and the environment.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/rfr-deter-mpt.pdf
RESIDENTIAL PROPERTIES
Sets forth EPA's policy to not require an owner of residential property to undertake response actions or pay cleanup
costs, unless the owner has caused the contamination. This policy does not apply when the owner fails to cooperate
with EPA or a state's response actions, meet CERCLA obligations, or uses the property inconsistently with a
residential use depiction.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/policv-owner-
rptpdf
SUPPLEMENTAL ENVIRONMENTAL PROJECTS
Provides background information on the use of supplemental environmental projects (SEPs), in addition to questions
and answers on the complementary role of SEPs at brownfield sites. This document supersedes the 1998 guidance
document "Using Supplemental Environmental Projects to Facilitate Brownfields Redevelopment."
To access online:
http://www.epa.gov/compliance/resources/publications/cleanup/brownfields/brownfield-seps.pdf
Contains a fact sheet on supplemental environmental projects to promote redevelopment on contaminated properties.
EPA issued this fact sheet to improve the environmental performance of redevelopment that follows clean up at any
contaminated property.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/brownfields/sep-redev-fs.pdf
WINDFALL LIENS
Discusses EPA and the Department of Justice's (DOJ) interim policy implementation of the new CERCLA 107(r)
windfall lien provision contained in the 2002 Brownfields Amendments. This document lists the factors that EPA
will use to determine whether to file a lien, in addition to discussing how EPA will settle the liens and the possibility
of EPA issuing comfort letters to or making agreements with bona fide prospective purchaser (BFPPs).
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/interim-windfall-
lien.pdf
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Provides questions and answers regarding Superfund's windfall lien section, including what properties it applies to,
the factors that EPA uses to determine whether EPA will file a windfall lien, and how the windfall lien interacts with
a § 107(1) lien.
To access online: http://www.epa.gov/compliance/resources/policies/cleanup/superfund/interim-windfall-
lien-faq.pdf
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Contact Information
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Contact Information
U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue, N.W., Washington,
DC 20460-0001
Office of Site Remediation Enforcement:
http://www.epa.gov/compliance/cleanup/revitalization/index.html
Office of Brownfields and Land Revitalization:
http://www.epa.gov/brownfields/
Office of Superfund Remediation and Technology Innovation:
http://www.epa.gov/superfund/partners/osrti/index.htm
Office of Resource Conservation and Recovery
http://www.epa.gov/osw/hazard/index.htm
Office of Underground Storage Tanks:
http://www.epa.gov/oust/
Federal Facilities Restoration and Reuse Office
http://www.epa.gov/fedfac/
' ,u. '
Regional Brownfields Coordinators: http://epa.gov/brownfields/corcntct.htm
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