The CERCLA Redevelopment Focus: Will There Be an Impact on Remedy Selection Decisions and Natural Resource Damage Claims?

Hunton Andrews Kurth LLP
Jeffrey N. Martin

July 5, 2018

The United States Environmental Protection Agency (EPA) concluded a series of eight Superfund Listening Sessions between May 21 and June 18 to explain a number of initiatives to reform the Superfund program and promote the cleanup and redevelopment of contaminated sites. The PowerPoint presentations used in these sessions can be accessed here. While informative, the sessions and PowerPoint slides used by the speakers also raise some interesting questions about potential changes in the remedy selection process and the restoration of damaged natural resources.

The listening sessions are an outgrowth of the Superfund Task Force Recommendations issued on July 29, 2017. Six of the sessions focused on recommendations for measures that EPA could take to reform the program, without legislation or the issuance of new or revised regulations, by productively reusing contaminated property.[1] In this respect, the Superfund program differs from EPA’s recent efforts to reform the air, water and toxics programs through the withdrawal or revision of formal regulations. This strategy is understandable, and more easily implementable, for a program intended to address the unique, site-specific characteristics of each contaminated site, rather than set uniform national standards for air, water quality and toxic substances. The listening sessions add a bit more clarity to the Agency’s site-specific focus on the potential redevelopment of Superfund sites.

One message of the redevelopment focused sessions seems to be that the Agency is taking an expansive view of what will qualify as a successfully redeveloped Superfund site. The June 11 listening session, for example, discusses the manner in which EPA is implementing Recommendation 21 to encourage potentially responsible parties to integrate reuse opportunities into the cleanup process. The PowerPoint slides describe the Sacramento, California, Aerojet Superfund site, a site that previously served as a location for industrial chemical and pesticide manufacturing operations, as well as rocket propulsion system manufacturing and testing operations. Aerojet’s redevelopment plan featured the use of a solar farm on the undeveloped portions of the site and office while featuring commercial and light industrial use on other portions of the site. A site that once housed businesses that caused groundwater contamination was converted to other commercial uses with more benign impacts on the environment. At the other end of the redevelopment spectrum discussed in the June 11 listening session is the Olathe, Kansas, Chemical Commodities, Inc. site. There, a 1.5 acre property with soil and groundwater contamination from VOCs, PCBs, PAHs and pesticides was converted into a pollinator prairie park, a true “greenfield” with prairie grasses and wildflowers providing habitat for butterflies. The contrasting examples suggest that less polluting commercial or industrial options as well as habitat creation and restoration options both may qualify as the sort of “productive uses” of property that EPA will promote. There are no established metrics for measuring what will qualify as a successful redevelopment, so EPA may be well positioned to claim credit and success whenever an NPL site is redeveloped in some manner.

Another message of the listening sessions seems to be that encouraging third parties to invest in the redevelopment of contaminated property is an important objective of the Administration’s Superfund reform initiative. The June 5, 2018, listening session on Task Force Recommendation 27 discusses new tools, such as comfort letters, agreements and guidance, to encourage private investment in cleaning up and reusing Superfund sites. In a similar vein, the June 11, 2018, listening session on Task Force Recommendation 29 describes the sorts of revisions that can be made to EPA’s “common elements” guidance to afford greater protection from liability for those who purchase contaminated sites. These sessions send a message to would-be developers that EPA is looking to reduce transaction costs and lower the risks of acquiring and developing formerly contaminated property. Implicit in these and related initiatives is an apparent bias in favor of commercial development. Whether that policy preference will find its way into the remedy selection process remains to be seen. If it does, there are potential conflicts with remedy selection guidelines that, on balance, encourage cleanup and restoration over alternative commercial uses of contaminated sites. The National Contingency Plan requirements for evaluating alternative remedies instruct the lead agency to consider nine criteria, most of which involve the protection of public health and welfare and the environment, and none of which expressly involve the redevelopment possibilities of the site. See 40 C.F.R. § 300.430(e)(a)(iii). Evaluating the commercial redevelopment possibilities for a site could run afoul of the existing regulations, and effectively would have responsible parties remediate sites in a manner that, perhaps unfairly or even unlawfully, subsidizes future developers.

Finally, an important question left unanswered in the Task Force Recommendation/ Redevelopment Focus List/ Listening Session realignment of CERCLA priorities is how a pro-development CERCLA program will co-exist with the restoration emphasis of CERCLA’s natural resource damage regime. The EPA policy objectives of Superfund reform may clash with habitat restoration goals of the Departments of the Interior and Commerce, trustees of damaged resources. Claims by the trustees to recover damages for injuries to natural resources and plans for the restoration of damaged resources may be undercut when CERCLA sites are later redeveloped. For example, a contaminated site restored with a grass cover loses much of its value as a productive habitat if it is paved over as a parking lot for an expanding business. A contaminated landfill that is remediated with a vegetative soil cover will lose habitat value if it is fitted with solar panels for a power project. The new uses are “productive” – solar power, for example, can generate revenue to offset operation and maintenance costs of the landfill remedy and also provide a source of clean power to the impacted community. But habitat for wildlife is lost. If this is the tradeoff for development, will the Department of the Interior reduce the amount of claimed damage when a change in the design of a remedy is made to sacrifice habitat for economic development? Will the redevelopment focus of EPA’s remedy selection process run counter to Interior and Commerce efforts to include restoration options in the remedy selection process? The National Contingency Plan regulations require that federal and state trustees be involved in the process of planning Superfund remedies. E.g., 40 C.F.R. § 300.430(b)(7). How will their voices be heard, and their interests served, if redevelopment rather than resource restoration is given greater weight in the remedy selection and implementation process? Development, and redevelopment, always come at a cost. Is one of the costs a reduced emphasis on the restoration of habitat?

These are just a few of the questions suggested by the topics discussed in the listening sessions. They are part of a much broader set of questions being asked about the Administration’s reform of the Superfund program as a whole. Each of the listening sessions concludes with an invitation to the listeners to submit comment on specific questions and the general policies that were discussed. EPA’s responses to these comments, and its further clarification of existing guidance documents, may add further definition to a Superfund program that appears to be moving ahead, without legislation or regulation, with a pro-development agenda.

This article is being provided for informational purposes only and not for the purposes of providing legal advice or creating an attorney-client relationship. You should contact an attorney to obtain advice with respect to any particular issue or problem you may have. In addition, the opinions expressed herein are the opinions of Mr. Martin and may not reflect the opinions of Synergy Environmental, Inc., Hunton Andrews Kurth LLP or either of those firms’ clients.

Jeff Martin is a partner at Hunton Andrews Kurth LLP and a nationally recognized figure in superfund, natural resource damage, and toxic tort litigation. Jeff is a member of the firm’s environmental team, which represents clients in numerous matters involving natural gas, chemicals, products and hazardous materials, extractive industries, food and beverages, technology, manufacturing and health care with regard to climate change law and policy, environmental enforcement defense, water, natural resources and permitting. Clients benefit from their interdisciplinary approach, which combines subject-matter knowledge with skilled advocacy by experienced practitioners at the administrative, legislative, trial and appellate levels. Read more on The Nickel Report  for recent trends and developments in energy and environmental law from Jeff and his colleagues.

 

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