Tagged: CERCLA

Settlors Beware: A Recent NJ District Court Decision Has the Potential to Have Far Reaching Impacts on Parties Entering into Settlements Under CERCLA

Settlors Beware: A Recent NJ District Court Decision Has the Potential to Have Far Reaching Impacts on Parties Entering into Settlements Under CERCLA

A recent decision from the United States District Court for the District of New Jersey may throw a new wrinkle into the already complex settlement process under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). Specifically, the decision addresses the question of what claims are included in the “matters addressed” in a settlement and entitled to contribution protection. On July 23, 2018, in N.J. Dep’t of Envtl. Prot. v. Am. Thermoplastics Corp, et al., Judge William H. Walls granted summary judgment in favor of the third-party defendants Carter Day Industries, Inc. (CDI), Combe Fill Corporation (CFC), and Combustion Equipment Associates, Inc. (“CEA”) (collectively, “Carter Day Parties”). Judge Walls held that the Carter Day Parties are entitled to contribution protection from claims for CERCLA costs incurred by the United States Environmental Protection Agency (USEPA) based on a settlement agreement between the Carter Day Parties and the State of New Jersey, notwithstanding that USEPA was not a party to the settlement. In following, the five-count first amended complaint of the third-party plaintiffs’ Compaction Systems Corporation of Connecticut, Inc. and Compaction Systems Corporation of New Jersey (together, “Compaction”) was dismissed with prejudice. The five counts of the complaint were: i) cost recovery...

EPA Provides Guidance to BFPPs Regarding Their Ability to Receive Reimbursement from EPA Superfund Special Accounts

EPA Provides Guidance to BFPPs Regarding Their Ability to Receive Reimbursement from EPA Superfund Special Accounts

One underused provision in the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) makes Environmental Protection Agency (EPA) Superfund Special Accounts available for reimbursement to Bona Fide Prospective Purchasers (BFPPs). This provision has received greater scrutiny by EPA following the creation of the Superfund Task Force (“Task Force”) in May 2017, and BFPPs should carefully consider the potential benefits that Superfund Special Accounts might provide. The Task Force includes senior representatives from different EPA Regional Offices with responsibility for Superfund policy and enforcement. EPA created the Task Force to streamline and strengthen the Superfund program. In July 2017, the Task Force issued a report containing five goals and 42 recommendations. The full report is available here. Goal number two in the report is to reinvigorate responsible party cleanup and reuse of Superfund sites. One of the specific recommendations relating to this goal is to maximize the use of special accounts to facilitate site cleanup and/or redevelopment. EPA has begun to implement this recommendation with the issuance of a March 27, 2018 memorandum to its Regional Offices entitled: “Guidance on Disbursement of Funds from EPA Special Accounts to Entities Performing CERCLA Response Actions.” The full memorandum is available here. On July...

Superfund Task Force Listening Session on Recommendation 16-2, Part 2: Improving Implementation of Cleanup Agreements for Response Actions by PRPs

Superfund Task Force Listening Session on Recommendation 16-2, Part 2: Improving Implementation of Cleanup Agreements for Response Actions by PRPs

On June 18, 2018, the United States Environmental Protection Agency’s (“EPA”) held the last of eight listening sessions on the recommendations of its Superfund Task Force. This last listening session concerned Part 2 of Recommendation 16-2018, which calls for improvement in the process of implementing cleanup agreements under which potentially responsible parties (PRPs) commit to carry out site cleanups under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). EPA speakers included Ellen Stern (Office of Regional Counsel, Region 10), Ken Patterson (Office of Site Remediation Enforcement (OSRE), Douglas Dixon (OSRE), and Charles Howland (Office of Regional Counsel, Region 3). They noted a number of reasons for delays in the completion of cleanups under such agreements, ranging from the submission of multiple versions of the same deliverable and time-consuming dispute resolution procedures to lax (or, conversely, excessively stringent) enforcement of deadlines and imposition of stipulated penalties. They also acknowledged EPA’s reluctance to exercise its most extreme enforcement tool – taking over the work and using financial assurance established by the PRPs. Outside participants called on EPA to expand the number of PRPs that are called upon to perform cleanups (including municipalities) to reduce the financial burden on any one PRP. The Superfund...

Superfund Task Force Recommendation 23 Listening Session: Informing Parties About Streamlining the Cleanup and Redevelopment Process

Superfund Task Force Recommendation 23 Listening Session: Informing Parties About Streamlining the Cleanup and Redevelopment Process

The Environmental Protection Agency (“EPA”) held a listening session concerning the Superfund Task Force (“Task Force”) Recommendation 23 on June 13, 2018. Recommendation 23 focuses on tools designed to assist parties interested in redevelopment of contaminated sites. The EPA created the Task Force in May 2017, which is comprised of senior representatives from various EPA offices associated with Superfund policy and enforcement. The Task Force intends to streamline and strengthen the Superfund program. In July 2017, the Task Force issued a report containing five goals and 42 recommendations. The Task Force’s five goals are to: i) expedite the cleanup and remediation process; ii) reinvigorate responsible party cleanup and reuse; iii) encourage private investment; iv) promote development and community revitalization; and v) engage parties and stakeholders. The full report is available here. Phil Page from EPA’s Office of Site Remediation Enforcement, Policy, and Program Evaluation Division presented the listening session for Recommendation 23. The slide deck from the session is available here. Recommendation 23 aims to deliver an efficient and effective process to identify site-specific liability issues, to identify best manage practices to quickly respond to third-party concerns regarding liability, and to create a national team of redevelopment experts. Recommendation 23...

Superfund Task Force Listening Session on Recommendation 21: Encouraging PRPs to Integrate Reuse Opportunities into Cleanups

Superfund Task Force Listening Session on Recommendation 21: Encouraging PRPs to Integrate Reuse Opportunities into Cleanups

On June 11, the U.S. Environmental Protection Agency (EPA) held the fourth of its listening sessions on the recommendations of its Superfund Task Force to improve the implementation of the federal Superfund program. This session focused on Recommendation 21, which is to encourage Potentially Responsible Parties (PRPs) to integrate reuse opportunities into their cleanup plans. The EPA presenters began by providing the background of the Superfund Task Force Report and its five overall goals: (1) expediting cleanup and remediation; (2) reinvigorating PRP cleanup and reuse; (3) encouraging private investment; (4) promoting redevelopment and community revitalization; and (5) engaging partners and stake holders. The EPA presenters identified why PRPs may have an incentive for incorporating reuse into their cleanup plans. They also posed two questions: (1) why do PRPs not routinely consider re-use when performing site investigations and cleanups; and (2) what options and incentives can EPA use to assist PRPs in integrating re-use into their decision-making process? A copy of the slide presentation accompanying EPA’s oral presentations is available here. EPA then opened the floor for questions and comments from the participants in the listening session. There was only one comment made during the call: a lawyer from Northwestern Pritzker...

Superfund Task Force Listening Session – Exploring CERCLA Environmental Liability Transfer Approaches

Superfund Task Force Listening Session – Exploring CERCLA Environmental Liability Transfer Approaches

On June 5, 2018 the Superfund Task Force held another of its eight scheduled public listening sessions intended to solicit public and stakeholder input relating to recommendations contained in the Task Force’s July 2017 report. The listening session focused on Recommendation 22, which suggests exploring Environmental Liability Transfer (ELT) approaches and other risk management tools. While Recommendation 22 addresses a variety of risk management approaches Potentially Responsible Parties (PRPs) might use to transfer responsibilities, the listening session honed in on ELTs specifically. Participants in the listening session were able to follow along with a presentation from Greg Wall of OSRE’s Regional Support Division, Erik Hanselman of OSRE’s Policy and Program Evaluation Division, and Charlie Howland from the Region 3 Office of Regional Counsel, who described the general function of ELTs and offered details from two case-studies where ELTs were used effectively to spur cleanup by private parties at sites with unique challenges. As detailed by the presenters during the session, an ELT is a mechanism whereby PRPs contractually transfer their cleanup response obligations to a specialized third party for a negotiated price. The upside to the public of such arrangements is that they encourage cleanup by specialized private parties who are particularly...

Superfund Task Force Recommendation 27 Listening Session: New Tools to Encourage Private Investment in Cleaning Up and Reusing Superfund Sites

Superfund Task Force Recommendation 27 Listening Session: New Tools to Encourage Private Investment in Cleaning Up and Reusing Superfund Sites

The Environmental Protection Agency (EPA) held a listening session concerning the Superfund Task Force (“Task Force”) Recommendation 27 on June 5, 2018 focusing on new tools for reusing Superfund sites through private investment. The EPA created the Task Force in May 2017, and it is comprised of senior representatives from various EPA offices associated with Superfund policy and enforcement. The Task Force intends to streamline and strengthen the Superfund program. In July 2017, the Task Force issued a report containing five goals and forty-two recommendations. The Task Force’s five goals are to: i) expedite the cleanup and remediation process; ii) reinvigorate responsible party cleanup and reuse; iii) encourage private investment; iv) promote development and community revitalization; and v) engage parties and stakeholders. The full report is available here. Recommendation 27 seeks to implement some or all of the five goals by identifying tools for third parties interested in opportunities that support the cleanup or reuse of priority sites. EPA understands potential investors have concerns about uncertain liabilities, and looks to identify those specific concerns and to identify tools that may address such concerns. For example, the agency may determine standard language to include in agreements that would facilitate financing, and...

Superfund Task Force Holds First of Eight Listening Sessions for Stakeholders, Focused on Expediting Settlement Negotiations

Superfund Task Force Holds First of Eight Listening Sessions for Stakeholders, Focused on Expediting Settlement Negotiations

The Superfund Task Force, created in May 2017, issued a report in July 2017 proposing recommendations to streamline and strengthen the Superfund program. The Report contained five goals and 42 recommendations. In order to obtain input from stakeholders and the public and to increase transparency and improve communications, USEPA has convened eight listening sessions being held from May 21 to June 18, 2018. The Gibbons Environmental Department will be covering these listening sessions and blogging about them. The first listening session, which focused on expediting settlement negotiations, was held on May 21, 2018. The five goals of the Superfund Task Force Report are: (1) expediting cleanup and remediation process, (2) reinvigorating responsible party cleanup and reuse, (3) encouraging private investment, (4) promoting redevelopment and community revitalization, and (5) engaging partners and stakeholders. The first listening session focused on Goal 2 through the strategy of encouraging responsible party clean-up with expedited negotiations. Christina Skaar from OSRE’s Regional Support Division and Elizabeth McKenna, Region 10 Office of Regional Counsel, made a short presentation at the beginning of the listening session. Recommendation 16.2 covers strategies to focus on and decrease the time involved in negotiating cleanup agreements and implementing cleanup work once agreement is finalized. Ms....

Budget Act Makes Changes to Federal Brownfield Program

Budget Act Makes Changes to Federal Brownfield Program

As noted in last week’s blog, the recently-passed Consolidated Omnibus Appropriations Act made a number of modifications to the federal brownfield program. That blog focused on the expansion of lessees’ ability to qualify for Bona Fide Prospective Purchaser (BFPP) status (and thereby obtain protection from Superfund liability). However, the Act made other changes that are of interest to brownfield site owners, developers, states, municipalities, and potential applicants for federal brownfield grant money. These modifications are found in Division N of the legislation, entitled “the Brownfields Utilization, Investment, and Local Development Act of 2018” (“BUILD Act”). They include the following: eliminating state and local government Superfund liability for sites acquired through seizure or otherwise in connection with law enforcement activity. State and local governments were previously protected only with respect to sites acquired “involuntarily”; eliminating the restriction for grants to petroleum sites that a site must be “relatively low risk” as compared with other petroleum-only sites in a state; allowing grants to be used for the cleanup of publicly-owned properties even if the public owner is not a BFPP; increasing the maximum federal brownfield grant per site from $200,000 to $500,000, which limit can be waived by EPA up to a...

Federal Budget Act Expands Lessees’ Ability to Claim Superfund Exemption as Bona Fide Prospective Purchasers

Federal Budget Act Expands Lessees’ Ability to Claim Superfund Exemption as Bona Fide Prospective Purchasers

The recently-enacted Consolidated Omnibus Appropriations Act made headlines in extending funding for federal government programs through September 30, 2018. Less widely noted were the myriad changes wrought by the Act to the administration of many federal programs. Among the programs affected was the federal brownfields program. The major substantive change in the Act was the expansion of the Bona Fide Potential Purchaser (BFPP) protection for lessees of properties. BFPP status exempts from Superfund liability parties who become owners or operators of facilities after the discharge of contaminants, so long as they are unrelated to parties responsible for the discharge, conduct “all appropriate inquiries” (e.g., a Phase I environmental site assessment) prior to closing, and observe certain other protocols post-closing. Until now, lessees were precluded from qualifying as a BFPP unless the property owner was also a BFPP. Now, if a lessee performs the required actions, it can obtain BFPP protection irrespective of whether its landlord is similarly exempted. This change will have a major impact on the liability exposure of lessees, particularly those who are developing and operating properties under long term ground leases. Most of the Act’s other brownfield-related provisions concern the funding of federal brownfield grants. Non-profit organizations are now...