[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3620 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 3620

 To amend the Comprehensive Environmental Response, Compensation, and 
             Liability Act of 1980, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 22, 1993

Mr. Upton introduced the following bill; which was referred jointly to 
the Committees on Energy and Commerce, Public Works and Transportation, 
                           and Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To amend the Comprehensive Environmental Response, Compensation, and 
             Liability Act of 1980, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``    ''.
    (b) Table of Contents.--

Sec. 1. Short title and table of contents.
                      TITLE I--INNOCENT LANDOWNER

Sec. 101. Amendment to Superfund pertaining to innocent landowner 
                            defense.
Sec. 102. Effective date.
                      TITLE II--VOLUNTARY CLEANUPS

Sec. 201. Definitions.
Sec. 202. Applicability; integration with other Acts.
Sec. 203. Authorized State voluntary response programs.
Sec. 204. Procedures for undertaking voluntary responses.
Sec. 205. Response requirements.
Sec. 206. Relationship with other laws.
Sec. 207. Requirement to perform additional response action.
Sec. 208. Enforcement and effect of compliance with this title.
                     TITLE III--ECONOMIC INCENTIVES

Sec. 301. Environmental remediation tax credit.
Sec. 302. Deduction of environmental cleanup expenses.
                       TITLE IV--LENDER LIABILITY

Sec. 401. Amendments to Comprehensive Environmental Response, 
                            Compensation, and Liability Act of 1980.
Sec. 402. Scope of application.
                         TITLE V--MISCELLANEOUS

Sec. 501. Contractor liability
Sec. 502. Conduit acquisitions [To be provided].

                      TITLE I--INNOCENT LANDOWNER

SEC. 101. AMENDMENT TO SUPERFUND PERTAINING TO INNOCENT LANDOWNER 
              DEFENSE.

    Section 101(35) of the Comprehensive Environmental Response, 
Compensation, and Liability Act of 1980 (42 U.S.C. 9601 et seq.) is 
amended by redesignating subparagraphs (C) and (D) as subparagraphs (D) 
and (E), respectively, and inserting after subparagraph (B) the 
following:
    ``(C)(i) A defendant who has acquired real property shall have 
established a rebuttable presumption that he has made all appropriate 
inquiry within the meaning of subparagraph (B) if he establishes that, 
within 180 days prior to the time of acquisition, he conducted an 
environmental site assessment of the real property which meets the 
requirements of this subparagraph.
    ``(ii) For purposes of this subparagraph, the term `environmental 
site assessment' means an assessment of the real property and 
surrounding areas to obtain commonly known or reasonably ascertainable 
information about the property and to assess the obviousness of the 
presence or likely presence of contamination at the real property, and 
which consists of each of the following elements:
            ``(I) Interview of owners, operators, and occupants of the 
        property to determine information regarding the potential for 
        contamination there.
            ``(ii) review of standard historical sources as necessary 
        to determine previous uses and occupancies of the property 
        since the property was first developed. For purposes of this 
        subclause, the term ``standard historical sources'' means any 
        of the following, providing they are reasonable ascertainable: 
        recorded chain of title documents regarding the real property, 
        including all deeds, easements, leases, restrictions, and 
        covenants; aerial photographs; fire insurance maps; property 
        tax files; USGS 7.5 minute topographic maps; local street 
        directories; building department records; zoning/land use 
        records; and any other sources that are credible to a 
        reasonable person and that identify past uses and occupancies 
        of the property.
            ``(III) Determination of the existence of recorded 
        environmental cleanup liens against the real property which 
        have arisen pursuant to Federal, State, or local statutes.
            ``(IV) Review of reasonably ascertainable Federal, State, 
        and local government records of sites or facilities that are 
        likely to cause or contribute to contamination at the real 
        property, including, as appropriate, investigation reports for 
        such sites or facilities; records of activities likely to cause 
        or contribute to contamination at the real property, including 
        landfill and other disposal location records, underground 
        storage tank records, hazardous waste handler and generator 
        records and spill reporting records; and such other reasonable 
        ascertainable Federal, State, and local government 
        environmental records which reflect incidents or activities 
        which are likely to cause or contribute to contamination at the 
        real property.
            ``(V) A visual site inspection of the real property and all 
        facilities and improvements on the real property, and a visual 
        inspection of immediately adjacent properties, including an 
        investigation of any hazardous substance use, storage, 
        treatment, and disposal practices on the property.
A record is considered to be `reasonably ascertainable' for purposes of 
this clause if a copy or reasonable facsimile of the record, or access 
to it, is obtainable from the government agency by request (within 
reasonable time and cost constraints) and the record is practically 
reviewable.
    ``(iii) No presumption shall arise under clause (i) unless the 
defendant has maintained a compilation of the information reviewed in 
the course of the environmental site assessment.
    ``(iv) Notwithstanding any other provision of this paragraph, if 
the environmental site assessment discloses the presence of 
contamination at the real property to be acquired, no presumption shall 
arise under clause (i) with respect to such contamination unless the 
defendant has taken reasonable steps, in accordance with commonly 
available technology, existing law, and generally acceptable 
engineering practices, as may be necessary to confirm the absence of 
such contamination.
    ``(v) For the purposes of this paragraph, the term `contamination' 
means an existing release, a past release, or the material threat of a 
release of a hazardous substance, other than de minimis conditions that 
generally do not present a material risk of harm to public health or 
welfare or the environment.

SEC. 102. EFFECTIVE DATE.

    Subparagraph (C) of section 101(35) of the Comprehensive 
Environmental Response, Compensation, and Liability Act of 1980, as 
added by section 101, shall take effect on the date of the enactment of 
this Act.

                      TITLE II--VOLUNTARY CLEANUPS

SEC. 201. DEFINITIONS.

    For purposes of this title, the terms used herein shall have the 
same meaning as set forth in the Comprehensive Environmental Response, 
Compensation and Liability Act (42 U.S.C. 9601 et seq). Also for 
purposes of this Act, the following definitions shall apply:
            (1) The term ``CAA'' means the Clean Air Act (42 U.S.C. 
        1401 et seq).
            (2) The term ``CERCLA'' means the Comprehensive 
        Environmental Response, Compensation and Liability Act (42 
        U.S.C. 9601 et seq).
            (3) The term ``commercial property'' means any place where 
        people work that is accessible to the public. Such property 
        includes, but is not limited to, institutional properties, 
        stores, office buildings, and indoor transportation centers.
            (4) The term ``CWA'' means the Clean Water Act (33 U.S.C. 
        1251 et seq).
            (5) The term ``engineering controls'' means any mechanism 
        to contain or stabilize contamination or ensure the 
        effectiveness of a response action. Engineering controls 
        include caps, covers, dikes, trenches, and leachate collection 
        systems.
            (6) The term ``hazardous constituent'' means any hazardous 
        waste constituent identified by the Administrator under 
        subtitle C of the Resource Conservation and Recovery Act (42 
        U.S.C. 6901 et seq).
            (7) The term ``industrial property'' means any property 
        that does not meet the criteria established under the 
        definition of ``residential property'' or ``commercial 
        property''.
            (8) The term ``institutional controls'' means any mechanism 
        used to limit human activity or exposure at or near a 
        contaminated site, including restrictions on the use of the 
        site or access to the site. Institutional controls include 
        fences or gates, deed restrictions, prohibitions on well use, 
        and warning signs.
            (9) The term ``OPA'' means the Oil Pollution Act of 1990 
        (33 U.S.C. 2701 et seq).
            (10) The term ``RCRA'' means the Solid Waste Disposal Act, 
        as amended by the Resource Conservation and Recovery Act (42 
        U.S.C. 6901 et seq).
            (11) The term ``residential property'' means any place 
        where people live or reside. Such property includes housing and 
        the property on which housing is located, playgrounds, schools, 
        parks, and other similar areas within a residential community.
            (12) The term ``SDWA'' means the Safe Drinking Water Act 
        (42 U.S.C. 300(f) et seq).
            (13) The term ``TSCA'' means the Toxic Substances Control 
        Act (15 U.S.C. 2601 et seq).

SEC. 202. APPLICABILITY; INTEGRATION WITH OTHER ACTS.

    (a) Purpose.--This title provides an alternative method for 
remediation of contaminated sites and, when used at eligible sites, 
will satisfy the remediation requirements under the statutes specified 
in section 109(b) of this Act. The title establishes requirements 
applicable to, and criteria for determining the adequacy of, voluntary 
responses to releases or threatened releases of hazardous substances or 
hazardous constituents into the environment.
    (b) Applicability.--Except as provided in subsection (c), this 
title applies to any facility where there has been a release or threat 
of release of a hazardous substance or hazardous constituent into the 
environment including:
            (1) any facility subject to response under CERCLA, 
        including but not limited to facilities currently included on 
        or proposed for inclusion on the National Priorities List;
            (2) any facility subject to corrective action under RCRA 
        sections 3004(u) or 3008(h);
            (3) any facility containing polychlorinated biphenyls 
        subject to response under TSCA section 6(e); and
            (4) any facility included on a State list of contaminated 
        sites warranting response.
    (c) Exclusions.--This title does not apply to the following--
            (1) any portion of a facility with respect to which a 
        Record of Decision has been issued by the President under 
        CERCLA section 104;
            (2) any portion of a facility with respect to which an 
        administrative or judicial order or consent decree requiring 
        remedial action has been issued under CERCLA sections 106 or 
        122, RCRA section 7003, CWA section 504, or SDWA section 1431;
            (3) any land disposal unit with respect to which a closure 
        notification under subtitle C of RCRA has been submitted and 
        closure requirements have been specified in a closure plan or 
        permit; or
            (4) any portion of a facility with respect to which a 
        corrective action permit or order has been issued, modified, or 
        amended to require implementation of corrective measures.

SEC. 203. AUTHORIZED STATE VOLUNTARY RESPONSE PROGRAMS.

    (a) Agreements With States.--After enactment of this Act, any State 
may apply to the Administrator to administer the voluntary response 
program authorized under this title.
    (b) Approval of State Programs.--If the Administrator determines, 
after public notice and comment, that a State program submitted 
pursuant to subsection (a) is consistent with the provisions of this 
title and that the State has the capability to administer such program 
in accordance with the standards and procedures established pursuant to 
this title, the Administrator shall enter into an agreement with the 
State to administer such program. The Administrator shall approve or 
disapprove a State application within sixty days of the close of the 
public comment period. The Administrator's determination on a State 
application shall be published in the Federal Register and, in the case 
of approval, shall identify the State agency that will administer the 
program.
    (c) Effect of Approval.--(1) Subject to paragraph (2), a State with 
a program approved pursuant to subsection (b) shall have sole 
jurisdiction and responsibility for implementing and enforcing the 
requirements of this Act.
    (2) Whenever the Administrator determines after public hearing that 
a State is not administering and enforcing a program approved under 
subsection (b) in accordance with the requirements of this Act, the 
Administrator shall notify the State of such a determination. If 
appropriate corrective action is not taken by the State within a 
reasonable time, not to exceed ninety days, the Administrator shall 
withdraw approval of such program and provide notice of such withdrawal 
in the Federal Register. The Administrator shall not withdraw approval 
of any such program without having first notified the State, and made 
public, in writing, the reasons for such withdrawal.
    (d) Effect of Disapproval or Withdrawal.--In the case of 
disapproval of a State application pursuant to subsection (b) or 
withdrawal of State approval pursuant to subsection (c), the 
Administrator shall be responsible for administering a Federal program 
pursuant to this title and notice of such shall be published in the 
Federal Register.
    (e) State Approval of Voluntary Response Action.--Any approval of a 
voluntary response action by a State authorized under this section 
shall have the same force and effect as approval by the Administrator 
under this title.

SEC. 204. PROCEDURES FOR UNDERTAKING VOLUNTARY RESPONSES.

    (a) Notice of Intention To Conduct a Voluntary Response.--Beginning 
six months after the date of enactment of this Act, any person may 
submit a notification of intent to conduct a voluntary response 
pursuant to this title. Any person who intends to conduct a voluntary 
response pursuant to this title shall give written notice to the 
Administrator and the State in which the voluntary response is to 
occur. Such notice shall set forth information sufficient for the 
Administrator (or the State, if authorized) to determine that the 
facility is eligible for the voluntary response program. If the person 
giving notice is not the owner or operator of the facility, the notice 
shall include a representation that the owner or operator has consented 
to the conduct of the voluntary response action by the person giving 
notice.
    (b) Oversight Costs.--(1) As a condition of eligibility for the 
voluntary response program, the person giving notice must agree in 
advance to pay the reasonable direct costs incurred and documented by 
the Administrator (or the State, if authorized) in reviewing the 
response action plan in subsection (d) and overseeing the response.
    (2) A person conducting a voluntary response pursuant to this title 
shall make a one-time, non-refundable payment of $5,000 at the time the 
person submits a response action plan under subsection (d), which 
payment shall constitute a set-off against future oversight costs 
incurred by the Administrator (or the State, if authorized).
    (3) The Administrator (or the State, if authorized) shall establish 
procedures for arbitration of disputes concerning reimbursement of 
reasonable direct costs incurred under this title.
    (c) Facility Investigation.--Any person who intends to perform a 
voluntary response under this title shall first conduct a facility 
investigation which assesses those factors listed below that are 
necessary to determine an appropriate response to the particular 
release--
            (1) physical characteristics of the facility, including 
        important surface features, soils, geology, hydrogeology, 
        meteorology, and ecology;
            (2) characteristics or classifications of air, surface 
        water, and groundwater at the facility;
            (3) the general characteristics of the hazardous substances 
        and hazardous constituents at the facility, including quantity, 
        state, concentration, toxicity, propensity to bioaccumulate, 
        persistence, and mobility;
            (4) the extent to which the source of the release of 
        hazardous substances and hazardous constituents can be 
        adequately identified and characterized;
            (5) actual and potential exposure pathways through 
        environmental media;
            (6) actual and potential exposure pathways to human 
        receptors;
            (7) the current use(s) of the property and adjacent 
        properties; and
            (8) other factors that pertain to the characterization of 
        the facility for the purpose of a voluntary response or 
        selection of a response action alternative.
    (d) Response Action Plan.--
            (1) Requirement for a response action plan.--A voluntary 
        response to be carried out pursuant to this Act shall be set 
        forth in a ``response action plan'' submitted with the facility 
        investigation report to the Administrator (or the State, if 
        authorized). The response action plan shall describe--
                    (A) the response action to be taken;
                    (B) the response standards to be achieved in 
                accordance with section 205;
                    (C) the level or standard of control for hazardous 
                substances or hazardous constituents that will be 
                discharged or emitted into the environment during the 
                response action consistent with the standards under 
                section 205; and
                    (D) a schedule for completion of the response 
                action.
            (2) Public participation.--Within 15 days of receipt of the 
        response action plan, the Administrator (or the State, if 
        authorized) shall publish in the Federal Register (or State 
        equivalent) notice of receipt of the plan and a brief summary 
        of the plan, information regarding the availability of the plan 
        to the public, and notice of a 45-day comment period.
            (3) Approval of response action.--A response action plan or 
        plan modification shall be deemed approved unless the 
        Administrator (or the State, if authorized) determines, within 
        30 days of the close of the public comment period specified in 
        subsection (2), that
                    (A) based on site-specific factors, the response 
                action plan or plan modification does not comply with 
                the response standards under section 205; or
                    (B) the response action plan or plan modification 
                as submitted, or the facility investigation on which it 
                is based, is otherwise not in accordance with the 
                requirements of this title.
        Such determination shall be in writing and shall state with 
        specificity the basis for the disapproval. The Administrator 
        (or the State, if authorized) shall publish in the Federal 
        Register (or State equivalent) notice of its decision of 
        approval or disapproval of a response action plan, along with 
        the name of the person from which additional information may be 
        obtained concerning the agency's decision.
            (4) Waiver.--
                    (A) A person conducting a voluntary response under 
                this title may submit with the response action plan, or 
                at any time thereafter, a petition to the Administrator 
                (or the State, if authorized) for a waiver of the 
                response requirements in section 205.
                    (B) Within 15 days of receipt of the waiver 
                petition, the Administrator (or the State, if 
                authorized) shall publish in the Federal Register (or 
                State equivalent) notice of the waiver petition and 
                notice of a thirty-day comment period.
                    (C) The Administrator (or the State, if authorized) 
                shall, within thirty days of the close of the comment 
                period described in subsection (B), grant a waiver of 
                the applicable standards at a particular facility in 
                response to such petition where:
                            (i) compliance with the applicable 
                        standards will result in greater risk to human 
                        health and the environment than alternative 
                        options;
                            (ii) compliance with the applicable 
                        standards is impracticable from an engineering 
                        perspective;
                            (iii) the response action will attain a 
                        level of protection that is equivalent to that 
                        provided by the applicable standards; or
                            (iv) contaminants will not travel the 
                        expected exposure pathway(s) as a result of 
                        site-specific conditions, institutional 
                        controls, or engineering controls.
    (e) Reporting and Recordkeeping Requirements.--
            (1) Reporting.--A person conducting a voluntary response 
        pursuant to this title shall submit an annual progress report 
        to the Administrator (or the State, if authorized) which 
        includes--
                    (A) a description of the actions which have been 
                taken in accordance with the approved response action 
                plan; and
                    (B) the results of sampling and analysis required 
                by the response action plan generated during the prior 
                year.
            (2) Recordkeeping.--A person conducting a voluntary 
        response under this title shall document the actions taken and 
        maintain, for five years after the person submits a 
        certification under subsection (f) to the appropriate agency, 
        the following records--
                    (A) the notification to the Administrator and the 
                State required by subsection (a);
                    (B) the facility investigation report;
                    (C) the response action plan;
                    (D) all data required to be generated by the 
                response action plan, including post-response 
                verification data; and
                    (E) the certification submitted pursuant to 
                subsection (f) demonstrating that the voluntary 
                response is complete and in compliance with the 
                response action plan.
    (f) Certification.--(1) Upon completion of the voluntary response, 
a person conducting a response under this title shall submit to the 
Administrator (or the State, if authorized), a certification that the 
voluntary response has been completed in accordance with the approved 
response action plan. The certification shall include the information 
required under subsection (e)(1) and all post-response verification 
data required by the response action plan. For response action plans 
that require operation and maintenance or monitoring for a period 
exceeding two years, the certification may be submitted at the 
completion of any other work required by the approved response action 
plan. The certification shall be signed by the duly authorized 
representative of the person conducting the voluntary response and an 
independent registered professional engineer.
    (2) A voluntary response action under this title shall be deemed 
approved unless, within ninety days of submission of the certification 
provided in paragraph (1) of this subsection, the Administrator (or the 
State, if authorized) exercises its authority under section 207(a).

SEC. 205. RESPONSE REQUIREMENTS.

    (a) Compliance With Response Standards.--Voluntary responses 
conducted pursuant to this Act shall attain response standards derived 
on a site-specific basis in accordance with this section. In 
determining the appropriate means of achieving such standards, persons 
undertaking voluntary response and the approving governmental agency 
shall take into account the practicability of the chosen response from 
an engineering perspective, the existence of background levels of 
contaminants on the property, and the cost of the response in relation 
to the degree of risk reduction achieved by such response. Response 
actions under this Act may attain the response standards of this 
section through the use of reliable engineering controls (such as 
geohydrologic measures, grout curtains, etc.) and/or institutional 
controls where the party undertaking response can demonstrate that (i) 
other response measures are impracticable for economic, technological, 
or implementation reasons, or (ii) engineering and/or institutional 
controls are necessary to control the source of contamination or 
prevent exposure as part of an overall remedial action program.
    (b) Performance of a Site-Specific Risk Assessment.--A person 
seeking to conduct a voluntary cleanup must submit a site-specific risk 
assessment along with the response action plan. The risk assessment 
shall be performed in accordance with currently acceptable scientific 
principles, and shall take into account, among other factors, 
variability in exposed individuals, variability in contaminant levels, 
actual or planned land, surface water, and groundwater use, reasonable 
exposure points, and the most probable, as opposed to worst case, 
exposure scenarios.
    (c) Establishment of Site-Specific Response Standards.--A response 
action plan shall set forth response standards to be achieved by the 
response action, along with supporting documentation and explanation, 
such that--
            (1) for carcinogenic hazardous substances or hazardous 
        constituents, the concentration level represents an excess 
        upper bound lifetime cancer risk to an individual of between 1 
        x 10-4 and 1 x 10-6; or
            (2) for noncarcinogenic hazardous substances or hazardous 
        constituents, the concentration level will not result in 
        adverse effects on human health over a lifetime or part of a 
        lifetime, with an adequate margin of safety.
    (d) Alternative Response Standards.--A person submitting a response 
plan may, in lieu of performing a site-specific risk assessment and 
deriving response standards therefrom, instead rely on promulgated 
Federal and State response standards that are appropriate for hazardous 
substances or constituents of concern and the environmental conditions 
which obtain at the site, provided such standards meet the risk 
reduction goals set forth in section 106(c).
    (e) Science Advisory Board Study.--
            (1) Purpose of the study.--Within 12 months of the date of 
        enactment of this Act, the Environmental Protection Agency 
        Science Advisory Board shall complete a report on the validity 
        of the risk assessment methodologies used by the Environmental 
        Protection Agency with any recommendations it believes are 
        appropriate to improve the accuracy and reliability of those 
        methodologies.
            (2) Elements to be studied.--In conducting such review, the 
        National Academy of Sciences shall consider relevant factors 
        including the following:
                    (A) the degree to which exposure assumptions 
                reflect actual exposure;
                    (B) the appropriateness of assumptions concerning 
                human behavior, including land and water use;
                    (C) other techniques used for estimating the 
                exposure of human receptors to contaminants; and
                    (D) other techniques used for assessing the 
                potential adverse human health effects associated with 
                exposure.
            (3) Public comment on the report.--The Administrator shall 
        publish the report upon receipt from the Science Advisory Board 
        and solicit comment thereon within 30 days of publication. 
        Within 60 days of the close of the public comment period, the 
        Science Advisory Board shall, if appropriate, modify the report 
        to incorporate public comment and issue a final version of the 
        report.
            (4) Content and use of the report.--The Science Advisory 
        Board report shall describe in detail current risk assessment 
        practices and shall set forth specific recommendations for 
        revising such practices. Within 3 months following issuance of 
        the final report, the Administrator shall revise the 
        Environmental Protection Agency's risk assessment guidance and 
        policy documents to reflect the recommendations contained in 
        the report.

SEC. 206. RELATIONSHIP WITH OTHER LAWS.

    (a) Permits Not Required.--No Federal, State, or local permit shall 
be required for any voluntary response conducted onsite in compliance 
with this title.
    (b) NCP.--Voluntary responses conducted in accordance with the 
terms and conditions of this title shall be deemed consistent with the 
National Contingency Plan for purposes of private cost recovery claims 
under CERCLA or OPA.
    (c) Effect of Response.--Performance of a voluntary response 
pursuant to this title shall not constitute an admission of liability 
under any Federal, State, or local laws or regulations or in any 
private action nor shall such performance be admissible as evidence in 
any citizen's suit or private action brought under any of the statutes 
specified in section 208(b) of this title.

SEC. 207. REQUIREMENT TO PERFORM ADDITIONAL RESPONSE ACTION.

    Upon receiving certification under section 204(f) that a voluntary 
response action under this title is complete, the Administrator (or a 
State, if authorized) may require additional response actions only 
under the following circumstances:
            (1) The Administrator (or the State, if authorized) 
        determines in writing, based on review of records or sampling 
        data following completion of the response action, that the 
        voluntary response has not been substantially completed; or
            (2) The Administrator (or the State, if authorized) learns 
        of new significant and reliable information not available at 
        the time of response action plan approval, other than revised 
        regulations, guidance, or test methods, that would have 
        justified the application of substantially different conditions 
        at the time of approval and at the time of discovery of such 
        new information.

SEC. 208. ENFORCEMENT AND EFFECT OF COMPLIANCE WITH THIS TITLE.

    (a) Enforcement.--Whenever the Administrator (or the State, if 
authorized) determines that any person has failed to comply with the 
terms or conditions of an approved response action plan, the 
Administrator (or the State, if authorized) may issue an order 
requiring compliance with such term or condition. If the person fails 
to comply with the order, a civil penalty of not more than $10,000 per 
violation may be assessed by the Administrator (or the State, if 
authorized) for the violation of the term or condition of an approved 
response action plan identified in the order. In determining the amount 
of any penalty assessed pursuant to this subsection, the Administrator 
(or the State, if authorized) shall take into account the nature, 
circumstances, extent and gravity of the violation, any good-faith 
efforts to comply with the terms and conditions of the response action 
plan, the degree of culpability or the economic benefit (if any) 
resulting from the violation, any prior history of such violation, and 
such other matters as justice may require. No penalty may be assessed 
under this subsection unless the person accused of the violation is 
given notice and opportunity for a hearing with respect to the 
violation.
    (b) Effect of Compliance.--Voluntary responses undertaken pursuant 
to an approved response action plan and the terms and conditions of 
this title shall be deemed in compliance with the requirements of the 
CAA, CWA, SDWA, OPA, CERCLA, RCRA, TSCA, and equivalent State and local 
laws and shall not be subject to any substantive or procedural 
requirements of such laws, and no further response action shall be 
required under such laws for any matter addressed in the voluntary 
response plan for a particular facility.

                     TITLE III--ECONOMIC INCENTIVES

SEC. 301. ENVIRONMENTAL REMEDIATION TAX CREDIT.

    (a) General Rule.--Part IV of subchapter A of chapter 1 of the 
Internal Revenue Code of 1986 (relating to credits allowable) is 
amended by adding at the end thereof the following new subpart:

             ``Subpart H--Environmental Remediation Credit

                              ``Sec. 54. Amount of environmental 
                                        remediation credit.
                              ``Sec. 54A. Designation of eligible 
                                        jurisdictions.
                              ``Sec. 54B. Allocation of credit limits.
                              ``Sec. 54C. Definitions and special 
                                        rules.

``SEC. 54. AMOUNT OF ENVIRONMENTAL REMEDIATION CREDIT.

    ``(a) General Rule.--For purposes of section 38, the environmental 
remediation credit determined under this section is 25 percent of the 
costs--
            ``(1) which are paid or incurred by an eligible taxpayer 
        for environmental remediation with respect to any contaminated 
        site, and
            ``(2) which are incurred by the taxpayer pursuant to an 
        environmental remediation plan for such site which was approved 
        by the Administrator of the Environmental Protection Agency.
    ``(b) Remediation Plan Must Be Completed.--
            ``(1) In general.--Except as otherwise provided in 
        paragraph (2)--
                    ``(A) no environmental remediation credit shall be 
                determined under this section with respect to any 
                qualified contaminated site unless the Administrator of 
                the Environmental Protection Agency certifies the 
                environmental remediation plan for such site has been 
                completed, and
                    ``(B) if such Administrator certifies that such 
                plan has been completed, such credit shall be taken 
                into account under subsection (a) ratably over the 5 
                taxable year period beginning with the taxable year in 
                which such plan was completed.
            ``(2) Special rule where extraordinary cost increases.--
        If--
                    ``(A) the taxpayer determines that due to 
                unforeseen circumstances the cost of completing the 
                remediation plan for any qualified contaminated site 
                exceeds 200 percent of the estimated costs of 
                completing such plan, and
                    ``(B) the State or local official administering the 
                remediation credit program agrees with such 
                determination,
        the taxpayer may cease the implementation of such plan and 
        shall be entitled to an environmental remediation credit with 
        respect to costs incurred before such cessation. Such credit 
        shall be taken into account under subsection (a) ratably over 
        the 5-taxable-year period beginning with the taxable year in 
        which such cessation occurs.
    ``(c) Eligible Taxpayer.--For purposes of this section, any 
taxpayer who is not liable under any authority of law for environmental 
remediation at a contaminated site is an eligible taxpayer with respect 
to that site.
    ``(d) Certain Parties Not Eligible.--A taxpayer shall not be 
eligible for any credit determined under this section with respect to 
any qualified contaminated site if--
            ``(1) at any time on or before the date of the enactment of 
        this subpart such taxpayer was the owner or operator of any 
        business on such site,
            ``(2) at any time before, on, or after such date of 
        enactment such taxpayer--
                    ``(A) had (by contract, agreement, or otherwise) 
                arranged for the disposal or treatment of any hazardous 
                materials at such site or arranged with a transporter 
                for transport for disposal or treatment of any 
                hazardous materials at such site, or
                    ``(B) had accepted any hazardous materials for 
                transport to such site, or
            ``(3) the taxpayer is related to any taxpayer referred to 
        in paragraph (1) or (2).
    ``(e) Administration by State or Local Government Agencies 
Permitted.--Any reference in this section, section 144(d), or section 
150(b)(7) to the Administrator of the Environmental Protection Agency 
shall include a reference to the head of any State or local government 
agency designated by the Administrator to carry out the Administrator's 
functions under such sections with respect to any site.

``SEC. 54A. CREDIT LIMIT.

    ``For all periods after the enactment of this subpart, there shall 
be an overall credit limitation of $500,000,000 to be allocated on the 
basis of the date on which each taxpayer filed a claim for a credit 
determined under this subpart.

``SEC. 54B. DEFINITIONS AND SPECIAL RULES.

    ``(a) Contaminated Site.--For purposes of this subpart--
            ``(1) In general.--The term `contaminated site' means any 
        site if at least 1 of the following environmental conditions 
        are present on such site:
                    ``(A) A release or threatened release of any 
                hazardous, toxic, or dangerous substance.
                    ``(B) Any storage tanks which contain any 
                hazardous, toxic, or dangerous substance.
                    ``(C) Any illegal disposal of solid waste.
            ``(2) Hazardous, toxic, or dangerous substance.--Any 
        substance, waste, or material shall be treated as a hazardous, 
        toxic, or dangerous substance if it is so treated under--
                    ``(A) the Comprehensive Environmental Response, 
                Compensation, and Liability Act (42 U.S.C. 9601 et 
                seq.),
                    ``(B) the Resource Conservation and Recovery Act 
                (42 U.S.C. 6901 et seq.), or
                    ``(C) any State or local environmental law or 
                ordinance.
        The following materials shall in any event be treated as such a 
        substance: petroleum or crude oil or any derivative thereof, 
        friable asbestos or any asbestos containing material, 
        polychlorinated biphenyls, or urea formaldehyde foam 
        insulation.
    ``(b) Environmental Remediation.--For purposes of this subpart, the 
term `environmental remediation' means--
            ``(1) removal or remediation activity in accordance with an 
        approved environmental plan including soil and ground water 
        remediation,
            ``(2) restoration of natural, historic or cultural 
        resources at the site, or the mitigation of unavoidable losses 
        of such resources incurred in connection with the remediation 
        or response activity,
            ``(3) health assessments or health effects studies,
            ``(4) environmental audits,
            ``(5) remediation of off-site contamination caused by 
        activity on the site, and
            ``(6) any other costs reasonably required by reason of the 
        environmental conditions of the site including demolition of 
        existing contaminated structures, site security, and permit 
        fees necessary for remediation.
    ``(c) Basis Reduction.--The basis of any qualified contaminated 
site shall be reduced by the amount of any credit determined under this 
subpart with respect to such site.
    ``(d) Related Person.--For purposes of this subpart, persons shall 
be treated as related to each other if such persons are treated as a 
single employer under the regulations prescribed under section 52(b) or 
such persons bear a relationship to each other specified in section 
267(b) or 707(b).''
    (b) Credit Made Part of General Business Credit.--Subsection (b) of 
section 38 of such Code is amended by striking ``plus'' at the end of 
paragraph (7), by striking the period at the end of paragraph (8) and 
inserting ``, plus'', and by adding at the end thereof the following 
new paragraph:
            ``(9) the environmental remediation credit under section 
        54(a).''
    (c) Limitation on Carryback.--Subsection (d) of section 39 of such 
Code is amended by adding at the end thereof the following new 
paragraph:
            ``(4)  No carryback of environmental remediation credit 
        before effective date.--No portion of the unused business 
        credit for any taxable year which is attributable to the credit 
        under section 54 may be carried back to a taxable year ending 
        before the date of the enactment of section 54.''
    (d) Deduction for Unused Credit.--Subsection (c) of section 196 of 
such Code is amended by striking ``and'' at the end of paragraph (4), 
by striking the period at the end of paragraph (5) and inserting ``, 
and'', and by adding at the end thereof the following new paragraph:
            ``(6) the environmental remediation credit determined under 
        section 54.''
    (e) Clerical Amendment.--The table of subparts for part IV of 
subchapter A of chapter 1 of such Code is amended by adding at the end 
thereof the following new item:

                              ``Subpart H--Environmental remediation 
                                        credit.''
    (f) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 302. DEDUCTION OF ENVIRONMENTAL CLEANUP EXPENSES.

    (a) In General.--Part VI of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to itemized deductions for 
individuals and corporations) is amended by adding at the end thereof 
the following new section:

``SEC. 197. HAZARDOUS SUBSTANCE CLEANUP EXPENDITURES.

    ``(a) Treatment as Expenses.--A taxpayer may treat hazardous 
substance cleanup expenditures paid or incurred during the taxable year 
as expenses which are not chargeable to capital account. The 
expenditures so treated shall be allowed as a deduction.
    ``(b) Hazardous Substance Cleanup Expenditures.--For purposes of 
this section--
            ``(1) In general.--The term `hazardous substance cleanup 
        expenditures' means expenditures paid or incurred in connection 
        with a trade or business of the taxpayer for any of the 
        following:
                    ``(A) Costs of removal or remedial action required 
                by reason of any release or threatened release of a 
                hazardous substance.
                    ``(B) Costs of any environmental audit, monitoring 
                or oversight activity, or health evaluation occurring 
                in connection with any such removal or remedial action.
                    ``(C) Costs of determining the extent to which the 
                taxpayer is required to take action or pay costs or 
                other damages under the Comprehensive Environmental 
                Response, Compensation, and Liability Act of 1980.
            ``(2) Definitions.--The terms `hazardous substance', 
        `release', `removal', and `remedial action' have the respective 
        meanings given such terms by section 101 of the Comprehensive 
        Environmental Response, Compensation, and Liability Act of 
        1980.
    ``(c) When Method May Be Adopted.--
            ``(1) Without consent.--A taxpayer may, without the consent 
        of the Secretary, adopt the method provided in this section for 
        the taxpayer's first taxable year which begins after the date 
        of the enactment of this section and during which the taxpayer 
        paid or incurred hazardous substance cleanup expenditures.
            ``(2) With consent.--A taxpayer may, with the consent of 
        the Secretary, adopt at any time the method provided in this 
        section.
    ``(d) Scope.--The method adopted under this section shall apply to 
all hazardous substance cleanup expenditures. Such method shall apply 
to the taxable year for which adopted and all subsequent taxable years 
unless the Secretary consents to a different method for part or all of 
such expenditures.''
    (b) Table of Sections.--The table of sections for part VI of 
subchapter B of chapter 1 of such Code is amended by adding at the end 
thereof the following new item:

                              ``Sec. 197. Hazardous substance cleanup 
                                        expenditures.''
    (c) Effective Date.--The amendments made by this section shall 
apply to expenditures paid or incurred in taxable years beginning after 
the date of the enactment of this Act.

                       TITLE IV--LENDER LIABILITY

SEC. 401. AMENDMENTS TO COMPREHENSIVE ENVIRONMENTAL RESPONSE, 
              COMPENSATION, AND LIABILITY ACT OF 1980.

    The Comprehensive Environmental Response, Compensation, and 
Liability Act of 1980 is amended--
            (1) by striking the last sentence of paragraph 101(20)(A); 
        and
            (2) by inserting the following new paragraphs 101(20) (E) 
        and (F):
                    ``(E)(i) The term `owner or operator' does not 
                include a person who, without participating in the 
                management of a vessel or facility, holds indicia of 
                ownership primarily to protect his or her security 
                interest in the vessel or facility.
                    ``(ii) The term `indicia of ownership' means any 
                legal or equitable interest in property acquired 
                directly or indirectly--
                            ``(I) for the purpose of securing payment 
                        of a loan or indebtedness, a right of 
                        reimbursement or subrogation under a guaranty, 
                        or the performance of another obligation,
                            ``(II) evidencing ownership under a lease 
                        financing transaction where the lessor does not 
                        initially select or ordinarily control the 
                        daily operation or maintenance of the property, 
                        or
                            ``(III) in the course of protecting a 
                        security interest or right of reimbursement or 
                        subrogation under a guaranty.
                `Indicia of ownership' include evidence of interests in 
                mortgages, deeds of trust, liens, surety bonds, 
                guaranties, lease financing transactions where the 
                lessor does not initially select or ordinarily control 
                the daily operation or maintenance of the property, 
                other forms of encumbrances against property recognized 
                under applicable law as vesting the holder of the 
                security interest with some indicia of title, legal or 
                equitable title obtained at, or in lieu of, 
                foreclosure, and their equivalents. A person may, but 
                is not required to, hold title in property in order to 
                hold indicia of ownership in that property.
                    ``(iii) A `holder of a security interest' is a 
                person who holds indicia of ownership in property 
                primarily to protect a security interest. A `holder of 
                a security interest' includes the initial holder (such 
                as a loan originator) and any subsequent holder (such 
                as a successor-in-interest or subsequent purchaser of 
                the security interest on the secondary market); 
                guarantor; lease financier or any successor where the 
                lessor does not initially select or ordinarily control 
                the daily operation or maintenance of the property; any 
                person who holds indicia or ownership primarily to 
                protect a security interest; or a receiver or other 
                person who acts on behalf or for the benefit of a 
                holder of a security interest.
                    ``(iv) The term `security interest' means an 
                interest in property created or established for the 
                purpose of securing a loan, right of reimbursement or 
                subrogation under a guaranty, or other obligation or 
                constituting a lease financing transaction. Security 
                interests include mortgages, deeds of trust, liens, 
                lease financing transactions in which the lessor does 
                not initially select or ordinarily control the daily 
                operation or maintenance of the property, trust receipt 
                transactions, and their equivalents. Security interests 
                may also arise from transactions such as sales and 
                leasebacks, conditional sales, installment sales, 
                certain assignments, factoring agreements, accounts 
                receivable financing arrangements, and consignments, if 
                the transaction creates or establishes an interest in 
                property for the purpose of securing a loan, right of 
                reimbursement or subrogation under a guaranty or other 
                obligation.
                    ``(v) The term `participating in the management of 
                property' means actual participation in the management 
                or operational affairs of the property by the holder, 
                and does not include the mere capacity to influence, or 
                ability to influence, or the unexercised right to 
                control facility operations. A holder is participating 
                in management while the borrower is still in possession 
                of the property encumbered by the security interest, 
                only if the holder either--
                            ``(I) exercises decisionmaking control over 
                        the borrower's environmental compliance, such 
                        that the holder has undertaken responsibility 
                        for the borrower's solid waste handling or 
                        disposal practices; or
                            ``(II) exercises control at a level 
                        comparable to that of a manager of the 
                        borrower's enterprise, such that the holder has 
                        assumed or manifested responsibility for the 
                        overall management of the enterprise 
                        encompassing the day-to-day decisionmaking of 
                        the enterprise with respect to--
                                    ``(aa) environmental compliance; or
                                    ``(bb) all, or substantially all, 
                                of the operational (as opposed to 
                                financial or administrative) aspects of 
                                the enterprise other than environmental 
                                compliance. Operational aspects of the 
                                enterprise include functions such as 
                                that of facility or plant manager, 
                                operations manager, chief operating 
                                officer, or chief executive officer. 
                                Financial or administrative aspects 
                                include functions such as that of 
                                credit manager, personnel manager, 
                                controller, chief financial officer, or 
                                similar functions.
                    ``(vi) The term `primarily to protect a security 
                interest' includes indicia of ownership acquired as a 
                consequence of having or exercising rights as a holder 
                of a security interest where the same is necessary or 
                appropriate to protect the security interest, to 
                provide for compliance with laws, to preserve the value 
                of the property or benefits therefrom, or to recover a 
                loan, indebtedness or right of reimbursement or 
                subrogation under a guaranty or to redress any other 
                obligation secured by such interest or to recover 
                property subject to a finance lease. A holder of a 
                security interest who directly or indirectly acquires 
                full title or a right to title or possession of such 
                property upon default under the security interest, or 
                at, or in lieu of, foreclosure, or, in the case of a 
                finance lease, upon expiration, cancellation, or 
                termination of such lease, shall continue to hold 
                indicia of ownership primarily to protect a security 
                interest so long as such holder is diligently 
                proceeding to sell or convey title or the right to 
                title or to re-lease such property on commercially 
                reasonable terms at the earliest possible time, while 
                preserving the property in the interim.
                    ``(vii) The term `property' means real and personal 
                property and includes facilities, storage tanks, 
                equipment, vessels, vehicles, and other modes of 
                transportation whether by sea, land, or air.
                    ``(viii)(I) The term `guarantor' includes 
                guarantors and sureties of security interests, 
                securities, and other obligations, issuers of letters 
                of credit and other credit enhancements, title 
                insurers, and entities which directly or indirectly 
                acquire indicia of ownership in the course of 
                protecting a security interest or acting as such 
                guarantors, sureties, issuers of letters of credit or 
                other credit enhancements or title insurers, and the 
                term `guaranty' includes guaranties, surety bonds, 
                title insurance policies, letters of credit and other 
                credit enhancements, and other agreements with a 
                guarantor relating to the obligations described in this 
                subclause (I).
                    ``(II) `Directly or indirectly' includes any 
                interest in property, security interest, indicia of 
                ownership title, or right to title held or acquired by 
                a fiduciary or similar entity for the benefit of a 
                holder of a security interest.
                    ``(ix) The terms `borrower', `debtor', and 
                `obligor' mean a person whose property is encumbered by 
                a security interest and includes a lessee under a lease 
                financing transaction.
                    ``(x) Actions taken by a holder of a security 
                interest to foreclose, sell, liquidate, release or 
                otherwise divest or cause the transfer of property 
                subject to a security interest; or preserve or protect 
                the value of such property; or otherwise to exercise 
                rights of a holder of a security interest specified in 
                subparagraph (v) above; or to assist the borrower, 
                debtor, obligor, or lessee in winding down its 
                operations or activities related to such property; or 
                to abandon or release the property prior to foreclosure 
                or its equivalents; or to require or conduct response 
                action on, or relating to, the property; shall not be 
                deemed `participating in the management of property' 
                within the meaning of this subsection (101)(20)(E). 
                Completion of an environmental inspection or evaluation 
                consistent with good commercial or customary practice 
                by or for the use of a holder of a security interest is 
                probative evidence that a holder of a security interest 
                is acting to preserve and protect the property during 
                the time the holder of a security interest may have 
                possession or control of such property, except that 
                this Act does not require a holder of a security 
                interest to conduct nor does it require any 
                environmental inspection or evaluation to qualify for 
                this exemption.
                    ``(xi) A holder of a security interest who, in 
                taking actions referred to in subparagraph (x) above 
                respecting property, actively and directly causes or 
                exacerbates a release of a hazardous waste for which a 
                Federal or an authorized State government determines 
                that response action is necessary, shall be liable for 
                the cost of such response action to the extent only 
                that the release is directly attributable to such 
                holder's activities, except that such a holder shall 
                not be liable for response action costs arising from a 
                release which commences before and continues after such 
                holder takes any action referred to in subparagraph (x) 
                above.
                    ``(F)(i) The term `fiduciary' means any entity 
                which is considered a fiduciary under section 3(21) of 
                the Employee Retirement Income Security Act of 1974, as 
                amended from time to time, or who is acting as trustee, 
                executor, administrator, custodian, guardian of 
                estates, conservator, committee of estates of disabled 
                persons, personal representative, receiver, agent, 
                nominee or in any other fiduciary capacity for the 
                benefit of another entity.
                    ``(ii) A fiduciary who acquires ownership or 
                control of property without having owned, operated, or 
                participated in the management of that property prior 
                to assuming ownership or control as fiduciary, other 
                than for the benefit of a holder of a security 
                interest, shall not be an `owner' or `operator' under 
                this Act.
                    ``(iii) Such a fiduciary who willfully, knowingly, 
                or recklessly causes (in a direct and active manner) a 
                release of a hazardous substance, for which a Federal 
                or an authorized State government determines that 
                response action is necessary, shall be liable for the 
                cost of such response action to the extent only that 
                the release is directly attributable to the fiduciary's 
                activities, except that such a fiduciary shall not be 
                liable for response action costs arising from a release 
                which commences before and continues after such 
                fiduciary acquires ownership or control of the 
                property.
                    ``(iv) Nothing in this subsection shall prevent 
                claims against the assets that constitute the estate 
                held by the fiduciary or the filing of actions against 
                the fiduciary in its representative capacity.

SEC. 402. SCOPE OF APPLICATION.

    The provisions of this title shall apply to--
            (1) all indicia of ownership acquired prior to the date of 
        enactment that are held primarily to protect a security 
        interest in property; and
            (2) each fiduciary with respect to any property acquired by 
        the fiduciary prior to the date of enactment.

                                 <all>

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