[Senate Hearing 106-322]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 106-322


 
                SUPERFUND PROGRAM COMPLETION ACT OF 1999

=======================================================================

                                HEARING

                               BEFORE THE

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                                   ON

                                S. 1090

    A BILL TO REAUTHORIZE AND AMEND THE COMPREHENSIVE ENVIRONMENTAL 
           RESPONSE, LIABILITY, AND COMPENSATION ACT OF 1980

                               __________

                              MAY 25, 1999

                               __________

  Printed for the use of the Committee on Environment and Public Works


                                


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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                       one hundred sixth congress
                 JOHN H. CHAFEE, Rhode Island, Chairman
JOHN W. WARNER, Virginia             MAX BAUCUS, Montana
ROBERT SMITH, New Hampshire          DANIEL PATRICK MOYNIHAN, New York
JAMES M. INHOFE, Oklahoma            FRANK R. LAUTENBERG, New Jersey
CRAIG THOMAS, Wyoming                HARRY REID, Nevada
CHRISTOPHER S. BOND, Missouri        BOB GRAHAM, Florida
GEORGE V. VOINOVICH, Ohio            JOSEPH I. LIEBERMAN, Connecticut
MICHAEL D. CRAPO, Idaho              BARBARA BOXER, California
ROBERT F. BENNETT, Utah              RON WYDEN, Oregon
KAY BAILEY HUTCHISON, Texas
                     Jimmie Powell, Staff Director
               J. Thomas Sliter, Minority Staff Director

                                  (ii)



                            C O N T E N T S

                              ----------                              
                                                                   Page

                              MAY 25, 1999
                           OPENING STATEMENTS

Baucus, Hon. Max, U.S. Senator from the State of Montana.........     2
Chafee, Hon. John H., U.S. Senator from the State of Rhode Island     1
Crapo, Hon. Michael D., U.S. Senator from the State of Idaho.....     5
Graham, Hon. Bob, U.S. Senator from the State of Florida.........    57
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     4
Lautenberg, Hon. Frank R., U.S. Senator from the State of New 
  Jersey.........................................................     5
Smith, Hon. Robert, U.S. Senator from the State of New Hampshire.    21
Voinovich, Hon. George V. U.S. Senator from the State of Ohio....    15

                               WITNESSES

Caveney, Red, president and CEO, American Petroleum Institute....    48
    Prepared statement...........................................   107
Curtis, Tom, director, Natural Resources Group, National 
  Governors' Association.........................................    25
    Prepared statement...........................................    66
    Responses to additional questions from Senator Voinovich.....    68
Florini, Karen, senior attorney, Environmental Defense Fund......    43
    Article, Analysis and Perspective, Superfund Site Remedies...    94
    Prepared statement...........................................    88
Ford, Mike, National Association of Realtors.....................    50
    Prepared statement...........................................   111
Gregor, Mark, manager, Division of Environmental Quality, City of 
  Rochester, NY..................................................    45
    Prepared statement...........................................   101
Johnson, Gordon J., Assistant Attorney General, New York State...    28
    Prepared statement...........................................    72
    Resolution, National Association of Attorneys General........    80
    Responses to additional questions from:
        Senator Baucus...........................................    82
        Senator Lautenberg.......................................    84
Kerbawy, Claudia, Chief, Michigan Superfund Program on behalf of 
  the Association of State and Territorial Solid Waste Management 
  Officials......................................................    26
    Prepared statement...........................................    68
Marshall, Jim, mayor, Macon, GA..................................     7
    Prepared statement...........................................    57
Nobis, Mike, general manager, JK Creative Printers, Quincy, IL...    47
    Prepared statement...........................................   105
Reilly, Bernard J., corporate counsel, DuPont de Nemours E.I. and 
  Company........................................................    41
    Prepared statement...........................................    86
Subra, Wilma, Subra Company, New Iberia, LA......................    30
    Prepared statement...........................................    85
Suozzi, Thomas, Mayor, Glen Cove, NY.............................    10
    Prepared statement...........................................    63

                          ADDITIONAL MATERIAL

Letter, Hazardous Waste Action Coalition.........................   113
Statements:
    Association of Battery Recyclers.............................   112
    Hazardous Waste Action Coalition.............................   114
    Nuclear Energy Institute.....................................   114
Resolution, National Association of Attorneys General............    80



                SUPERFUND PROGRAM COMPLETION ACT OF 1999

                              ----------                              


                         TUESDAY, MAY 25, 1999

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10 a.m. in room 
406, Senate Dirksen Building, Honorable John H. Chafee 
(chairman of the committee) presiding.
    Present: Senators Chafee, Inhofe, Baucus, Crapo, 
Lautenberg, Smith and Voinovich.

           OPENING STATEMENT OF HON. JOHN H. CHAFEE, 
          U.S. SENATOR FROM THE STATE OF RHODE ISLAND

    Senator Chafee. We want to welcome everyone this morning. 
We've got a long series of witnesses, so we're going to move 
right along.
    Tomorrow we had the Administrator scheduled to be here plus 
GAO as witnesses. I think what we'll do tomorrow is not have 
the hearing. But because there are possibilities of working 
something out here, and at the suggestion of the Administrator, 
we'll have a meeting with the Administrator, myself, Senator 
Smith, Senator Lautenberg, Senator Baucus, and see if we can't 
work something out here. I think that would be a worthwhile 
proposal.
    The Administrator has suggested it, Senator Baucus has 
mentioned it, and I think it presents possibilities of 
resolving this situation. We have a bill in, the Republicans 
do, as I understand, the Democrats on the committee have or 
will introduce a bill. And let's see if we can't reach some 
kind of a compromise and get on with this. We've spent so much 
time over so many years.
    Senator Baucus. Mr. Chairman, I compliment you for that 
decision. I think it will help us achieve a bipartisan 
Superfund bill. I'm not saying that will necessarily happen, 
but giving us the opportunity to talk over it with the 
Administrator and also have a little more information before us 
for the next hearing, particularly with respect to cost and 
some other matters. I think that will be very helpful and will 
likely work out a lot of the various issues that are before us.
    So I thank you for making that decision.
    Senator Chafee. OK, now I have a statement which I'll put 
into the record, and I'll encourage others to do likewise.
    [The prepared statement of Senator Chafee follows:]
Statement of Hon. John H. Chafee, U.S. Senator from the State of Rhode 
                                 Island
    Good morning. I am pleased to begin 2 days of hearings on S. 1090, 
the ``Superfund Program Completion Act of 1999.'' I thank Senator Smith 
for his leadership on Superfund and his help in crafting a bill which 
focuses on areas where bipartisan consensus is achievable this year.
    S. 1090 includes many provisions that have enjoyed widespread 
bipartisan support in the Senate, provisions included in bills 
supported by Democrats and Republicans over the past 6 years. Working 
together with Senators Baucus and Lautenberg, I am confident we can 
effect real legislative reform on some of Superfund's more immediate 
problems.
    S. 1090 will provide $100 million in grants for State, tribal and 
local governments to identify, assess and redevelop Brownfields sites. 
It protects prospective purchasers of contaminated sites, innocent 
owners of properties adjacent to the source of contamination, and 
innocent property owners who exercised due diligence upon purchase.
    Our bill exempts small businesses and contributors of very small 
amounts of hazardous and municipal solid waste. S. 1090 limits the 
liability of larger generators or transporters of municipal solid 
waste, as well as owners or operators of co-disposal landfills where 
municipal solid waste is disposed. The bill limits the liability of so-
called de minimis parties, as well as municipalities and small 
businesses with a limited ability to pay.
    Cleanup is complete or underway at over 90 percent of the sites on 
the current National Priorities List. While EPA is cleaning up the 
sites at a rate of 85 per year, only an average of 26 per year are 
listed. In 1998, GAO surveyed the States and EPA about the 3,000 sites 
identified as potential NPL sites. Of these sites, only 232 were 
identified as likely to be listed on the NPL. Clearly, this program 
will be getting smaller.
    S. 1090 requires EPA to plan how it will proceed at those 3,000 
sites. We know that most of these sites will be cleaned up by States, 
not by EPA. Under S. 1090, new NPL listings must be requested by the 
Governor of the affected State.
    The bill allows the program to be funded from either general 
revenues or the Trust Fund. Senator Smith and I have said that the 
Superfund taxes should not be reimposed absent comprehensive Superfund 
reform. If EPA improves its cost recovery performance and the Trust 
Fund balance exceeds levels needed to fund liability relief, it can be 
used for Superfund cleanup.
    I cannot understand why anyone would fail to support this bill. It 
accelerates Brownfields redevelopment and strengthens State programs. 
It limits or eliminates liability for many parties caught in 
Superfund's broad liability net, and it does not undermine the 
``polluter pays'' principle, but instead strengthens it.
    The committee will markup S. 1090 soon after returning from the 
Memorial Day recess. It is my hope that the bill will be ready for 
floor action prior to the Fourth of July. I look forward to working 
with committee members and the Administration as we focus on the future 
of the Superfund program.
    Senator Chafee. Let me just say that I think we've got a 
good bill. I suppose that's not unusual, to expect somebody 
who's sponsoring a bill to think it's a good bill. I don't 
think that will make me unique.
    But what our bill does is it accelerates brownfields 
redevelopment, strengthens State programs, limits or eliminates 
liability from any parties caught in Superfund's broad 
liability net, and doesn't undermine the polluter pays 
principle, but strengthens it.
    So I will ask that this statement go into the record. If 
others have statements they'd like to put in the record, now is 
a good chance.

             OPENING STATEMENT OF HON. MAX BAUCUS, 
             U.S. SENATOR FROM THE STATE OF MONTANA

    Senator Baucus. Mr. Chairman, I have a statement which is 
several pages which I will also put in the record. But I want 
to make a couple of points. First, I appreciate the provisions 
in your bill which are obviously intended to help move toward a 
compromise. And I think we have an opportunity here to find 
that bipartisan compromise.
    A couple of points, though, there are a couple of issues 
that have to be dealt with. The relationship between State 
voluntary cleanups and the suburban program referred to as 
Finality, we have to find some way to deal with that. Because 
it does make sense, it seems to me, not to give carte blanche 
wholly to States but rather have some kind of a good resolution 
of that issue.
    Second, the Fair Share Allocation System in your bill I 
think has to be examined to be sure that it does not cause more 
problems than we already have. One is the potential cost of 
reimbursing parties that might affect the pace of cleanups. 
We'll look at the details, which are very important.
    And also our funding. It looks like the bill will generate 
some new program costs, such as mandatory allocations and 
inventory special parcels. These may be good ideas, but they 
also make cumulatively generate some additional costs. And also 
the provision in the bill which reduces authorization levels 
quite sharply, which suggests that the pace of cleanup might be 
reduced. I don't think that's something that we want.
    Also we have to all look at financing. Because the bill 
does not contemplate any reinstatement of Superfund tax that 
has previously been associated very definitely with the fund. 
Because when the Superfund law was enacted, it was enacted with 
very strong intent to have a fund which would pay for the 
program. In fact, when President Carter suggested the bill, 
that was very much a part of what he suggested, and also in the 
report language that the Congress wrote with respect to the 
bill, that also was very integral, as part of the program.
    So essentially, we want to make sure we get the job done, 
that is, complete the cleanup, complete it fairly, but make 
sure we also have the resources to accomplish that objective. 
And with that, Mr. Chairman, I will conclude my remarks.
    [The prepared statement of Senator Baucus follows:]
  Statement of Hon. Max Baucus, U.S. Senator from the State of Montana
    Thank you, Mr. Chairman. To me, S. 1090 presents both good news and 
bad news.
    On a positive note, the bill drops several very contentious 
provisions that we were unable to resolve last year. I know how 
strongly Senator Smith feels about some of these issues.
    So we recognize and appreciate the step that you and he have taken. 
This creates an opportunity for us to find a fresh approach to a 
bipartisan compromise.
    If we are to do that, we also need to address the areas where the 
bill still needs improvement.
    First, there are a number of tough issues in the bill. For example, 
the relationship between state voluntary cleanups and the Superfund 
program, which is often referred to as the question of ``finality.'' As 
we know, state programs vary widely in their effectiveness. That is why 
I believe that a Federal safety net would assure protection of public 
health and the environment.
    But that is an issue, like many others in the bill, that, if we 
make an earnest, good faith effort, with give and take on both sides, 
we should be able to resolve.
    Second, the fair share allocation system. I agree that we should 
increase fairness and reduce litigation and other transaction costs. I 
also agree that orphan share funding is an important way to achieve 
this goal.
    But I have some concerns. One is the cost, especially the cost of 
reimbursing parties. Another is the potential impact on the pace of 
cleanups. Finally, like many other issues, the devil is in the details. 
And I hope this hearing will help answer our questions.
    Third, and probably most important. Funding. As we read the bill, 
it will generate new program costs, such as mandatory allocations, an 
inventory of separate parcels of land, and a review of all the 3,000 
sites in the Superfund data base. These may be good ideas, but they are 
expensive.
    At the same time, the bill reduces authorization levels, sharply. 
Furthermore, it contains a provision that prevents site cleanup if 
there is not enough money available to pay companies all of their new 
orphan shares.
    para.These provisions, in combination, may result not in the 
``completion'' of the Superfund program, as the bill's title suggests, 
but in a sharp reduction in the pace of cleanups, at the expense of 
thousands of people living near hazardous waste sites.
    I know that is not the chairman's intent. And I appreciate the 
chairman's efforts to get solid data about cleanup costs, something I 
hope we can begin to resolve with EPA this week.
    But, as we go forward, we must be very careful, to assure that this 
bill provides the funding necessary to get the job done.
    I look forward to working with the Chairmen, Administrator Browner, 
and others to assure this.
    That brings me to a final point. Financing the cleanup program.
    As I understand it, S. 1090 does not contemplate reinstatement of 
the Superfund taxes that previously have gone into the Superfund trust 
fund. Instead, it would fund cleanups almost exclusively out of general 
revenues.
    Some may think that this is a small matter of accounting. I 
disagree.
    Ever since the Superfund program was established, one of its 
critical features has been the existence of a special trust fund, 
financed by earmarked taxes.
    When this committee reported the first Superfund bill, back in 
1980, we described our main objectives. The first was assuring that 
responsible parties pay for environmental damage.
    We went on, and I quote:

    ``Second, providing a fund to finance response action where a 
    liable party does not clean up, cannot be found, or cannot pay the 
    costs of cleanup and compensation.''
    ``Third, basing the fund primarily on contributions from those who 
    have been generically associated with such problems in the past and 
    who today profit from products and services associated with such 
    substances.''

    We reaffirmed this in 1986 and 1990. The fund, and the earmarked 
taxes, have been an integral part of this cleanup program.
    Now, we're considering reauthorizing the Superfund program--but 
without the Superfund. This, to my mind, is unwise and unwarranted.
    With the budget pressures we face, we have to find a way to pay for 
this program.
    Mr. Chairman, it is my hope that we can work to resolve our 
differences over the operation of the program. And, as the process goes 
on, renew our longstanding commitment to a dedicated trust fund with an 
assured source of revenue.
    I look forward to working cooperatively with my colleagues toward 
those ends.
    Senator Chafee. Does anyone else want to put a statement in 
the record? Senator Inhofe.

          OPENING STATEMENT OF HON. JAMES M. INHOFE, 
            U.S. SENATOR FROM THE STATE OF OKLAHOMA

    Senator Inhofe. I have a statement to go in the record, so 
I'll make this very brief. Mr. Chairman, I characterize it in 
my mind as a kind of good bill, not great. There are a lot of 
things I'd like to see in here, NRD, many things.
    However, I think requiring the Governor's approval before 
listing an NPL, as a former mayor, I think that's a good idea 
and I'd like to get as much of that at the local level as 
possible. I think the fact that you did resist the 
reauthorization of the taxes is good.
    So as it is now, I would support it, but it could sure be a 
lot better, and I'm hoping that we'll be able to get some 
amendments and work on this to make it what I consider to be a 
better bill. I'll submit my entire statement for the record.
    [The prepared statement of Senator Inhofe follows:]
 Statement of Hon. Jim Inhofe, U.S. Senator from the State of Oklahoma
    Mr. Chairman. thank you for holding this important hearing today. 
You and Senator Smith have done outstanding work in crafting a bill 
that addresses those issues that can and should be changed within the 
program.
    I know not everyone is happy with your bill, and I too would like 
to see some amendments added during markup, specifically regarding NRD. 
But we must not loose focus of our goal. The process is broken and we 
must fix it in a way that will allow cleanups to take place more 
quickly and efficiently while continuing to provide adequate protection 
to the public.
    I do want to briefly comment on some aspects of the bill that I 
think are positive. First, by requiring Governors' approval before 
listing a site on the NPL, we are putting control back into the hands 
of the local governments who have the most at stake. As a former mayor, 
I can appreciate that negotiating with a Governor over a particular 
course of action would be preferred to negotiating with the EPA. 
Second, I am happy that you have decided to exempt small businesses, de 
micromis contributors of hazardous waste, and recyclers, specifically 
used oil, from liability under Superfund. This helps to level the 
playing field for those who are least able to afford the costs of 
cleanups. Finally, I support you and Senator Smith in your effort to 
resist re-authorizing the Superfund taxes. I agree with the arguments 
that you laid out in your letter to Timothy Fields at EPA, specifically 
that many parties who have engaged in their own cleanup effort would be 
liable for the tax if reimposed. Without sweeping changes to the 
program, taxes should not be reinstated.
    Mr. Chairman, I look forward to hearing from our witnesses today on 
both their personal experience with Superfund and their views on your 
bill, S. 1090. Thank you.
    Senator Chafee. Thank you. Go ahead, Senator Crapo.

          OPENING STATEMENT OF HON. MICHAEL D. CRAPO, 
              U.S. SENATOR FROM THE STATE OF IDAHO

    Senator Crapo. Thank you, Mr. Chairman. I'll be brief.
    I agree that there are a lot of good elements in the bill. 
As the chairman knows from discussions we've had, there are 
things I think should be put into the bill that aren't in the 
bill yet. As Senator Baucus indicated, if we go on and evaluate 
the issues of funding and financing, namely, the reinstitution 
of the taxes, if those issues are brought onto the table, in 
addition to what is now in the bill, then I think we also have 
to make sure that we finish the job, as Senator Baucus said.
    And that job requires that we not only do the good things 
that are in this bill now, but that we provide a comprehensive 
reform of the Superfund law, meaning we've got to look at the 
critical issues of liability and remedy in more detail and 
natural resources damages in more detail, and make sure that we 
do the job entirely.
    I believe there are lots of good things in this bill, 
there's a lot that needs to be put into the bill still, 
especially as we now move into the arena of discussing whether 
the taxes should be reauthorized.
    Senator Chafee. Thank you. Senator Lautenberg.

        OPENING STATEMENT OF HON. FRANK R. LAUTENBERG, 
           U.S. SENATOR FROM THE STATE OF NEW JERSEY

    Senator Lautenberg. Mr. Chairman, I don't want to be a 
spoil-sport. But first, let me commend you for the proposal 
that you put out that would have us discussing further some of 
the concerns or the questions that have arisen.
    But also with a matter of this magnitude, I think it is 
important to have our statements being able to be issued and 
heard. Because this is a very crowded schedule, and I respect 
that. I know, Mr. Chairman, as do many, that you've been very 
anxious to keep the program going and to make the changes that 
you deemed necessary.
    I have a statement of, I would say not intolerable length, 
but that's my view. I won't challenge the committee decision to 
give it, but I put it in the record reluctantly. I think that 
statements that go in the record are often seen on their way in 
and never seen again. And that for me, when we're discussing a 
subject as important as this subject, Mr. Chairman, you and I 
and Senator Baucus have been working with for 5 years now, and 
we came very close at one point to having a resolution. It 
didn't work.
    I am concerned about the funding ramp-down. I'm on the 
Budget and Appropriations Committees. And there's just not 
going to be enough money to carry on, the cap on the NPL 
concerns me, the reopening of decisions. There are several 
things. And because we have an illustrious witness group here, 
we want to hear what they have to say and we don't want to 
listen to ourselves, I don't think.
    But the fact of the matter is that we lose an opportunity 
to kind of help set an environment or stage that we'd all like 
to operate with. There are so many successes with the program 
as it is that before we change the whole thing, I think we need 
a fair amount of review. So in respect to you, Mr. Chairman, I 
will not give the statement at this time. I'll put it in the 
record and make another opportunity to give it.
    [The prepared statement of Senator Lautenberg follows:]
Statement of Hon. Frank Lautenberg, U.S. Senator from the State of New 
                                 Jersey
    Mr. Chairman, we are here again today to consider the 
reauthorization of Superfund. It has been a very long time since we 
began this process in the 103d Congress. Yet, during this time, the 
program has undergone major changes, and major improvements.
    In fact, as just about everyone involved in the Superfund program 
agrees, there have been major strides made in the number and pace of 
the sites being cleaned up.
    In fact, in the 103d Congress, the critics of Superfund raised a 
number of issues. They asserted that it was too slow, that not enough 
cleanups were taking place, that there was too much litigation.
    Back then, we were seeking solutions which would make the program 
faster, streamline cleanups, treat parties more fairly and get the 
little guys out earlier, all while keeping those responsible for the 
problem also responsible for cleaning it up. This was all within the 
general goals of achieving more cleanups and therefore providing better 
protection of human health and the environment.
    I am proud of those proposals, and many of us still on this 
committee, including the chairman, who voted for that bill way back in 
the 103d Congress should also be proud. Those proposals, although never 
enacted into law, were adopted administratively by EPA and radically 
altered the Superfund Program as we know it.
    Others have been tested and been improved upon. In general the 
thrust of this well intentioned bill has resulted in many of the 
achievements of the current program.
    According to a report issued by the General Accounting Office, by 
the end of this fiscal year all cleanup remedies will have been 
selected for 95 percent of non-Federal NPL sites (1,109 of 1,169 
sites).
    In addition, approximately 990 NPL sites have final cleanup plans 
approved, approximately 5,600 ``emergency removal'' actions have been 
taken at hazardous waste sites to stabilize dangerous situations and to 
reduce the threat to human health and the environment.
    More than 30,900 sites have been removed from the Superfund 
inventory of potential waste sites, to help promote the economic 
redevelopment of these properties.
    During this same time, EPA has worked to improve the fairness and 
efficiency of the enforcement program, even while keeping up the 
participation of potentially responsible parties in cleaning up their 
sites.
    EPA has negotiated more than 400 de minimis settlements with over 
10,000 small parties, which gave protection for these parties against 
expensive contribution suits brought by other private parties. 66 
percent of these have been in the last 4 years alone. Since fiscal year 
1996, EPA has offered ``orphan share'' compensation of over $145 
million at 72 sites to responsible parties who were willing to step up 
and negotiate settlements of their cases. EPA is now offering this at 
every single settlement, to reward settlers and reduce litigation, both 
with the government, and with other private parties.
    These are just a few highlights of the improvements made in the 
program, many drawn from our earlier legislative proposals. Other 
improvements, such as instituting the targeted review of complex and 
high-cost cleanups, prior to remedy selection, have reduced the cost of 
cleanups without delaying the pace of cleanups.
    In short, EPA's administrative reforms have significantly improved 
the program, by speeding up cleanups and reducing senseless litigation, 
and making the program fairer, faster and more efficient overall.
    But despite the fact that this is a program that has finally really 
hit its stride, we are now faced with proposals from the Majority which 
could undercut the progress in the program, and which are premised on a 
goal of closing down the program rather than a goal of cleaning up the 
sites.
    I am deeply troubled by many of the provisions in the Republican 
bill, which would have the effect of ramping the program down without 
regard to the amount of site work left to be done.
    This bill provides for lowered funding levels, a cap on the NPL, 
waivers of the Federal safety net, and some broad liability exemptions.
    At the same time, it creates a number of new, expensive obligations 
which would further reduce the amount of money available for cleanup. 
It also shifts the costs of the program to the taxpayers and would not 
include an extension of the Superfund tax.
    In short, while I am encouraged by the fact that the Republican 
bill drops some troubling provisions from prior bills, it introduces a 
whole set of new issues that we cause for great concern.
    I think it is very clear that what we need here is a better 
Superfund program, not a retreat from tackling our environmental 
problems.
    We need a bill that continues to accelerate the pace of cleanups, 
keeps cleanups protective, reduces litigation and transaction costs, is 
affordable and does not shift costs to the American taxpayer.
    Yesterday, with some of my colleagues, I introduced such a bill. 
believe that this bill, is in some areas very close to the provisions 
supported by my Republican colleagues, but differs in some critical 
areas. It would protect cleanups, reduce litigation and not shift costs 
to the American taxpayer.
    I hope that these are goals we can agree on. And I urge my 
colleagues to not throw the Superfund baby out with the bathwater.
    I look forward to working with my colleagues as we move forward. 
Thank you, Mr. Chairman.
    Senator Chafee. Good, fine. Thank you very much.
    We've got 13 witnesses this morning, and we've obviously 
got to move along at a fair nonetheless brisk pace.
    First we welcome the Honorable Jim Marshall, Mayor of 
Macon, Georgia, on behalf of the U.S. Conference of Mayors. 
Mayor, won't you proceed?

     STATEMENT OF HON. JIM MARSHALL, MAYOR, MACON, GEORGIA

    Mr. Marshall. Thank you, Mr. Chairman.
    Mr. Chairman, I represent the United States Conference of 
Mayors. The conference represents more than 1,000 cities of 
population 30,000 and over and the total U.S. population in 
those cities is in excess of 119 million. Every single one of 
those cities suffers from the brownfield problem, Mr. Chairman.
    We have a report done by the United States Conference of 
Mayors, I believe it's part of the record. One hundred 80 
cities responded to the request for information about 
brownfields, and you'll find the information in the report. 
Nineteen thousand sites, just the 180 cities, 19,000 sites, 
were identified, 178,000 acres are affected by this. Mr. 
Chairman, that's only 180 cities. There are some 2,000 
municipalities in the United States that are not represented by 
this survey.
    So the problem, Mr. Chairman, is enormous. I can speak of 
the problem from my own personal experience as the Mayor of 
Macon, Georgia. But Macon's experience is replicated across the 
United States, there's no question in my mind about that.
    When the conference first made an attempt to do a survey on 
brownfields about 3 years ago, I received the request for 
information and I sent it along to the key person in the middle 
Georgia area responsible for economic development and said, 
could you help me out, could you fill this out for me. He got 
back in touch with me and he said, I don't think you want to be 
on this list.
    So 3 years ago, we had the key economic development guy in 
the middle Georgia region saying, let's keep it quiet. We know 
we have these problems but we don't want to be on this list.
    Last year, instead of sending the survey to our economic 
development guy, I sent the survey to the head of our planning 
and zoning commission, the executive director, the person who's 
been in place for the last 20 years, a key planning character 
in the middle Georgia region. I said, would you fill this out.
    He sent it back to me. He identified one site. Again, not 
interested in being on somebody's list.
    This year, I managed to persuade the players that would 
respond and we've identified seven sites with 100 acres. The 
reality is, in Macon and other cities, it's far more than seven 
sites and far more than 100 acres.
    But it's a problem that everybody wants to ignore, 
everybody wants to keep quiet. The effect of this problem, Mr. 
Chairman, and I believe, I co-chair the Mayors and Bankers Task 
Force for the Conference. And the mayors and bankers are 
focusing on brownfields right now. I believe Senator Helmke, 
who is my co-chair, testified a couple of weeks ago.
    Senator Chafee. He did, yes.
    Mr. Marshall. I suspect he was very effective in trying to 
describe the problem. I don't want to go over ground that he's 
already tread.
    But the problem here is one that exacerbates greatly our 
sprawl phenomena. You have many owners of properties that are 
lying fallow in the inner city, already serviced by the 
infrastructure that's necessary in order for them to be very 
productive pieces of property.
    But they sit there because the owners of those properties 
are not interested in getting the bad news. It's kind of like, 
I'm not going to go see the doctor, even though something's 
wrong with me, because I'm worried the doctor might tell me 
I've got cancer. The same thing is happening with a lot of 
owners.
    As a result of that, a lot of this land in the center of 
our cities is lying fallow because the owners don't even want 
to know. They don't want to find out that this land that might 
be worth current market, $5,000 an acre, is going to cost 
$20,000 an acre to clean up.
    So an initial problem is how do you get the holders of 
these properties off dead center. It's easy enough for me to do 
where housing is concerned. I took over as mayor about three 
and a half years ago. We doubled our housing inspections force. 
I changed judges, I moved the housing inspector's unit to 
another department. We changed management, we gave uniforms, we 
went from card files to computers and digital cameras. We do 
systematic inspections of low-income housing in the city of 
Macon, distressed neighborhoods.
    The effect of that has been to literally tenfold increase 
the number of citations that are given. We've had a dramatic 
improvement in the quality of substandard housing in Macon. 
Well over 2,000 units have been repaired, 500 units have been 
demolished. And it's because owners are forced to get off the 
dime and do something with these properties instead of simply 
just letting them sit there.
    That description is analogous to the problem we have right 
now with an awful lot of underutilized or unused properties in 
our cities. It is simply sitting there, and there is no impetus 
for these owners to get off the dime.
    Now, even if an owner is interested in disposing of the 
property, the flip side of the coin is nobody's interested in 
picking up the property. The concern, of course, is liability 
if you buy these properties and they wind up being 
contaminated, or you find out they're contaminated. You've 
purchased the property, you've purchased the contamination 
problems.
    It would be wonderful if there would be finality. That 
would be a very big step forward, finality with respect to 
liability. And protection for innocent purchasers. Those two 
things would cause an awful lot of lenders and an awful lot of 
potential purchasers and developers to have a great deal more 
interest in coming into our inner cities and taking care of 
these underutilized properties.
    The problem we have right now, Mr. Chairman, is that the 
land values in our inner cities, not necessarily inner city 
Chicago, where the economics of a particular piece of land 
might be such that the cleanup costs can be covered as part of 
the transaction, for most of the cities across the country, 
we're being held hostage by a legitimate interest in having 
these properties cleaned up. Because of that legitimate 
interest, buyers are not interested in buying, sellers are not 
interested in discovering, potential sellers are not interested 
in discovering the real problems with their property. The 
cities are being held hostage.
    The effect is to cause the economics to continue to 
collapse. And you see sprawl phenomena like you see in the 
Atlanta region, I'm sure everybody here is familiar with the 
problems in Atlanta. That in the long run is going to 
exacerbate our environmental problems.
    Mr. Chairman, I know that you are very well known to be 
very effective in crafting bipartisan efforts to solve problems 
like this. And I know this committee has worked for years to 
try to solve this problem. I would encourage the Chairman to 
use his talents to pull folks together on a bipartisan basis to 
try to at least give cities some relief.
    If you can't solve all of the problems, a piece of 
legislation like this one, loaded down with the kinds of 
arguments that you all have been having with one another now 
for 6 years, is not going to go anywhere. If it's possible to 
craft some legislation that's bipartisan and will meet some of 
the concerns that the Administration has, so that we can get 
something done this year, the U.S. Conference of Mayors would 
be very much appreciative of that.
    If I could, Mr. Chairman, I'd like to address just one more 
issue. I might be stealing a little bit of Mayor Suozzi's 
thunder here. Liability for municipal landfills. Typically the 
problem has been caused by a former set of taxpayers. We are so 
mobile in the United States that you've got an old set of 
taxpayers who typically cause the problem and now, unless some 
relief is granted, the current set of municipal taxpayers are 
expected to deal with that problem.
    Well, I can tell you, Mr. Chairman, if that means raising 
taxes in the inner city to deal with these old landfills, the 
effect is going to be to simply drive people away from the 
inner city. That's exactly the opposite phenomena we would all 
like to see happen. We shouldn't be having higher taxes in the 
inner parts of our metropolitan areas. It should be lower. The 
financial incentive should be to push to the middle, not to 
push to the periphery. In the long run, that's healthy for us.
    To the extent that this committee can see its way to giving 
some relief where municipal landfill liability is concerned, 
what it effectively does is lessen or eliminate yet one more 
reason for us to spread out. I thank you very much, Mr. 
Chairman, for the opportunity to testify and I would be happy 
to respond to questions.
    Senator Chafee. Thank you very much, Mayor.
    And now Mayor Suozzi, Mayor of Glen Cove, New York.

  STATEMENT OF HON. THOMAS SUOZZI, MAYOR, GLEN COVE, NEW YORK

    Mr. Suozzi. Mr. Chairman, thank you very much. Senators, 
thank you very much and good morning.
    My name is Tom Suozzi, I'm the mayor of the city of Glen 
Cove, New York. It's a small city on the north shore of Long 
Island with about 25,000 people. We cover an area of about 
seven square miles. I'm pleased to be here to testify today 
regarding the needs of local governments for municipal 
Superfund liability relief, the narrow issue that Mayor 
Marshall referred to.
    I'm a member of the U.S. Conference of Mayors and endorse 
everything that Mayor Marshall said. But I'm here today 
representing eight other national municipal organizations that 
worked together for many years to seek municipal Superfund 
liability relief, so that we can resolve our involvement at 
these toxic waste sites, reduce litigation and transaction 
costs, and get on with the business of cleaning up and 
recycling these blighted sites into productive redevelopment in 
our communities.
    These organizations include the American Communities for 
Cleanup Equity, which was formed nearly a decade ago to address 
these municipal Superfund issues, as well as the American 
Public Works Association, the Association of Metropolitan 
Sewage Agencies, the International City/County Management 
Association, the International Municipal Lawyers Association, 
the National Association of Counties, the National Association 
of Towns and Townships, and the National League of Cities. I 
have never really had this much impact before.
    [Laughter.]
    Mr. Suozzi. Collectively, our organizations represent 
thousands of cities, towns, counties and local agencies across 
the United States. We are responsible for the health, safety 
and vitality of our communities and at the same time for 
fulfilling a very fundamental governmental duty to provide for 
municipal garbage and municipal sewage collection and disposal.
    We want to thank you, Senator Chafee, for your leadership 
and your commitment to addressing the issue of municipal 
liability and Superfund legislation. We also want to commend 
Senator Lautenberg, our neighbor in New Jersey, for championing 
Superfund relief for local governments for many long years.
    Indeed, as you know, there has been broad bipartisan, 
multi-stakeholders consensus on this municipal Superfund relief 
issue for many years. We hope that the parties will continue to 
work together to get this municipal Superfund issue resolved 
this year. No matter what other issues of contention may stand 
in our way, we must pass something this year to try and get us 
some relief.
    Local governments have a very serious problem. We've been 
saddled with years of delay, millions of dollars of liability 
and legal costs under the Superfund law, simply because we 
owned or operated municipal landfills or sent municipal solid 
waste or sewage sludge to landfills that also received 
industrial and hazardous waste. So a simple part of our jobs is 
to get rid of our garbage and sewage.
    Local governments have faced costly and unwanted 
contribution suits from industrial Superfund polluters seeking 
to impose an unfair share of costs on parties that contributed 
no toxic wastes to these so-called co-disposal landfill sites. 
We estimate that as many as 750 local governments at 250 sites 
nationwide are affected by the co-disposal landfill issue.
    The costs that our citizens bear as a result are unfair and 
unnecessary. Local governments are in a unique situation at 
these co-disposal sites. First, municipal solid waste and 
sewage sludge collection and disposal is a governmental duty. 
It is a public responsibility to our communities that we cannot 
ignore, and we make no profit from it.
    Second, the toxicity of municipal solid waste and sewage 
sludge has been shown to be significantly lower than 
conventional hazardous waste, and as such represents only a 
small portion of the cleanup costs at these co-disposal 
landfills.
    The city of Glen Cove has experienced the threat of costs 
and delay associated with these Superfund issues on a more 
broad basis. I said we're located on the north shore of Long 
Island. Glen Cove has 10 miles of beautiful waterfront, of 
which 9 miles are beautiful, pristine property with 300 acres 
of nature preserves, 3 public beaches and beautiful Gold Coast 
mansions. At one time, J.P. Morgan lived in our city, F.W. 
Woolworth lived in the city of Glen Cove. It cost $2 million to 
build his staircase in 1917.
    The city of Glen Cove is of course now a very diverse city 
with the very wealthy, the very poor, and everyone in between, 
with hundreds of units of public housing, $2.8 million in 
Section 8 housing.
    One mile of our waterfront, as I mentioned, there's ten 
miles of waterfront, one mile of our waterfront is the original 
industrial area of the city that is now home to Superfund 
sites, State and Federal, and several brownfield sites. The 
best example I give is of the LiTungsten plant, which is now 
home to contaminated low level radioactive waste. At one time, 
LiTungsten was the largest job provider in the city of Glen 
Cove, the largest taxpayer. They gave money to the local Little 
League baseball teams. They gave money to the local hospital.
    Now that property sits there, abandoned and dangerous, 
polluted. No jobs, no taxes, no support for the local community 
and drawing away from the health and safety of our residents 
and our reputation. This contamination, including the dumping 
of radioactive and hazardous waste at an adjacent site, there 
was once a municipally owned open dump, is now part of that 
Superfund site.
    Our objective is to recycle and reuse these properties and 
put them back to productive use and make it into a regional 
tourism destination, the main spot between Manhattan and the 
Hamptons. The process of resolving the city's Glen Cove 
municipal liability at this site has taken many years and many 
dollars.
    In addition to the sites I have mentioned, at a different 
Superfund site, the Kin-Buc Landfill in New Jersey, the city of 
Glen Cove was sued by industrial polluters seeking an unfair 
share of contribution because our city had transported 
municipal trash to that site. The legal process was likewise 
lengthy and costly.
    That's why Glen Cove supports legislative enactment of a 
municipal Superfund liability policy that will provide a 
simple, expedited and fair method of resolving a local 
government's liability associated with these co-disposal 
Superfund sites.
    Again, the city of Glen Cove has been recognized as one of 
only 16 national showcase brownfields communities for its 
proactive effort to clean up and redevelop its contaminated 
waterfront, and will continue to do so. However, the cost and 
delay associated with the threat of Superfund co-disposal 
litigation has hindered communities across the Nation like Glen 
Cove from focusing their energy on the vital cleanup, reuse and 
recycling initiatives that we need to be pursuing.
    Indeed, there is a broad consensus that municipalities need 
and merit liability relief. For nearly a decade, our coalition 
has worked with you and other Members of Congress and with the 
U.S. Environmental Protection Agency to formulate a reasonable 
solution to the problem. In February, 1998, with our support, 
the EPA finalized an administrative settlement policy to limit 
liability under Superfund for generators and transporters of 
municipal solid waste and sewage sludge and for municipal 
owners and operators of co-disposal landfills.
    We continue to support this reasonable and fair EPA policy 
and commend EPA for playing a proactive role in seeking to 
address a very complicated problem. However, as fair and 
appropriate as the administrative policy is, we strongly 
believe that legislative action to resolve the municipal 
Superfund liability issue is necessary and justified.
    First, the EPA policy is only a policy, non-binding on the 
agency and subject to change or challenge. Second, this policy 
has been the subject of litigation and the real threat of 
future litigation involving local government remains. While we 
continue to defend the EPA policy in court, as we did in 
Federal Court in 1998, and to advocate its use by our members, 
we believe that a change in Superfund law to address this issue 
is necessary to reduce the costly litigation and delay that 
municipalities may continue to face at these co-disposal sites.
    Third, we believe legislative enactment of the municipal 
Superfund liability provisions will give localities the 
certainty and confidence to make use of this settlement 
mechanism, much as the codification of lender liability 
Superfund provisions have provided certainty for the banking 
industry.
    Senator Chafee. Mayor, I wonder if you could just summarize 
these last points that you've got here. Your entire statement 
will be in the record.
    Mr. Suozzi. Let me just say that it's very important that 
we get some work done this year, Senator. My comments can be 
submitted to the record for your reading. The main issues have 
to do with these co-disposal liability provisions, and second, 
money for brownfields assessment and remediation and 
identification, as Mayor Marshall pointed out earlier.
    I want to thank you very much for the opportunity to 
testify.
    Senator Chafee. I'm familiar with your city, my wife comes 
from Bayville.
    Mr. Suozzi. Really?
    Senator Chafee. Yes.
    Mr. Suozzi. Well, come by and visit us. I'll give you some 
up-front testimony. Have you been back to visit at all?
    Senator Chafee. Yes, I've been down there lots of times.
    Mr. Suozzi. Oh, please stop over and say hello. I'll give 
you the grand tour. We'll take you to F.W. Woolworth's mansion 
for lunch.
    Senator Chafee. That must be some staircase he's got there.
    [Laughter.]
    Mr. Suozzi. We're afraid to walk up it sometimes.
    Senator Chafee. I want to thank both of you very much for 
your testimony. I think your points are very valid ones. Mayor, 
I think you're right when you say the municipalities are 
reluctant to list their contaminated sites. They just don't 
want to do it.
    So what we see in reports and indeed in the material you 
submitted is just a cursory view of the whole thing. It's much 
more serious than even your statistics would show.
    Mr. Marshall. That is certainly true, Mr. Chairman.
    Senator Chafee. Senator Baucus, do you have a question?
    Senator Baucus. Yes, I want to compliment Mayor Suozzi for 
your bipartisan tone in your statement. I appreciate it very 
much.
    Mayor Marshall, I am curious as to how we can get at this 
problem. What's the solution? That is, where a city has sites 
and wants to clean up on its own pretty much, worried about 
potential NPL listing, what the EPA might do. How do we get at 
this? It's a very real problem, obviously, so how do we solve 
it?
    Mr. Marshall. Senator, I think the problem goes well beyond 
the NPL issue. And our focus is on brownfields. In many 
instances, most, all but 1 percent of the brownfields, I'd say, 
don't merit NPL listing.
    But you have sellers who know that given the circumstances 
of the land around the particular area, know that this land 
isn't going to command the market value that will justify the 
threat of potential substantial cleanup costs and litigation 
costs, etc. So they may not even fence it, they'll just let it 
sit there.
    Now, how do you get past that? I don't have the answer to 
this. The provisions of the different bills that I have seen, 
and I haven't read the bills themselves, I've simply been given 
summaries as a mayor, and I'm the CEO, it's a strong mayor form 
of government, I've got a ton of things to do. So I can't claim 
to have the kind of expertise that you all have.
    Giving innocent purchasers relief will help somewhat. 
Giving finality, that helps a lot. I can tell you, that helps a 
lot. Because at least the parties going into a transaction know 
that at some point, they'll understand what the exposure is and 
they won't have to worry about some change on down the road. So 
that's very helpful also.
    But that doesn't address what I consider to be hundreds 
upon hundreds upon hundreds of thousands of acres that are 
simply going to sit there because the seller is not interested 
in finding out that he or she or it has cancer. It kind of 
knows, because it knows the past history of the property, knows 
also that the economics probably won't justify the potential 
cleanup costs.
    So all I do is I use an analogy to what we do, where 
substandard housing is concerned. We do systematic code 
enforcement. We go block by block, we look at the exterior 
properties. If the exterior justifies it, we'll knock on the 
door, see if we can inspect. We have not yet gone to get a 
warrant to inspect a house, but we would do that if need be.
    Once the owner of the house is cited for a violation, that 
starts a process that leads to the house being cleaned up and 
maybe being put back on the market.
    Senator Baucus. What do you do in the exceptional cases--I 
think we have to at least consider this question--when the 
local community decides to go ahead, clean up, and under some 
structure where there is no liability for the landowner or the 
seller or the purchaser, but where, oh, my gosh, it turns out 
that we have another Love Canal on our hands? What do we do in 
those cases, where I think justifiably, the EPA would figure, 
this is an NPL site, or this is something that warrants Federal 
intervention? How do you handle those exceptional cases?
    Mr. Marshall. If you're asking, and I'm not familiar with 
Love Canal in detail----
    Senator Baucus. Something went wrong that was unanticipated 
at the time.
    Mr. Marshall. At the time that finality was given.
    Senator Baucus. Exactly.
    Mr. Marshall. Parties didn't see, well, frankly, I think 
that's a risk we're going to have to take. And you might want 
to distinguish between old cases that have already been 
resolved by State environmental protection agencies or by the 
EPA, and say with regard to those old cases, no, we're not 
going to give finality. Because under the regime that existed 
at the time the parties dickered through this particular 
problem, be it Love Canal or the site in Denver I've heard 
about, finality was not an issue. We could go ahead and agree 
and know that we could come back later and do something here.
    Distinguish between the old cases and new cases. If you 
started effective the date of the legislation, the effective 
date of the legislation and went forward, and whenever State or 
Federal EPA-EPD cuts a deal with a potential purchaser and 
says, this is what you're going to be expected to do and that's 
all you're going to be expected to do, I would think that, take 
the chance, and give finality in those instances. Because the 
payback to all of us will be far greater than the few instances 
in which EPD-EPA will make a mistake and later worry about it, 
you know, say, oh, my gosh, we shouldn't have done it that way, 
really more cleanup is needed, or we capped it, we shouldn't 
have capped it, we should have put trees out there, whatever it 
is,
    Knowing that finality attends the decision it seems to me 
will cause the administrators to be pretty careful in making 
that decision, and the risk is warranted, it seems to me.
    Senator Baucus. It's an interesting question, and there's 
no final solution to this one, obviously.
    Mr. Marshall. So to speak.
    Senator Baucus. In the sense that if there were some huge 
exceptional case, that would not be the end of it. It would not 
be final. Somebody would file a lawsuit, and we'd be back in 
the soup again in some way or another.
    So I'm just trying to find some way to achieve your 
objective of certainty, but at the same time, in some 
reasonable way, I'm not saying----
    Mr. Marshall. Well, I guess my thought, Senator, and it's 
just off the top of my head, is that going forward, not going 
back, but going forward, administrators knowing that finality 
attends the decision, it seems to me, would be more careful in 
making the decision. And then if they made a mistake, it seems 
to me that there would be some cost that might wind up being 
borne by the Federal or State Government to do additional 
cleanup work, because there's nobody there to go after at that 
point.
    Senator Baucus. I understand that. But I think that still 
there should be some criteria, some something at the front end, 
I don't know what it is.
    Mr. Marshall. Before you can give finality?
    Senator Baucus. Before there is finality.
    Mr. Marshall. And that is well beyond my ability to do.
    Senator Baucus. Thank you.
    Senator Chafee. Senator Voinovich.

        OPENING STATEMENT OF HON. GEORGE V. VOINOVICH, 
              U.S. SENATOR FROM THE STATE OF OHIO

    Senator Voinovich. First of all, I apologize for being late 
for the beginning of the hearing, Mr. Chairman, and I ask that 
the statement I was going to give be inserted into the record.
    Senator Chafee. Without objection.
    [The prepared statement of Senator Voinovich follows:]
 Statement of Hon. George V. Voinovich, U.S. Senator from the State of 
                                  Ohio
    Mr. Chairman, I'd like to take the opportunity to thank you for 
conducting this important hearing today on Superfund. I commend the 
leadership and work that you and Senator Smith have done on this issue.
    I strongly believe that the current Superfund law is in need of 
commonsense reform, as it creates delays in the cleanup process and 
loss of available funds due to excessive litigation. I support the 
liability relief that your Superfund Program Completion Act provides 
for municipalities, small businesses, de minimis contributors, 
contiguous property owners and prospective purchasers.
    In addition, I strongly support the intention to reduce the state 
cost share to 10 percent across the board for both capital costs and 
operations and maintenance costs at NPL sites.
    Of particular importance to me are the provisions that allow states 
to release parties that have cleaned up sites under state laws and 
programs from Federal liability.
    I strongly concur with your approach that there should be no 
requirement that U.S. EPA pre-approve state laws and programs. State 
brownfields programs address non-NPL sites where the Federal Government 
has played little or no role.
    States are leading the way to cleaning up sites more efficiently 
and cost-effectively. States average more than 1,400 cleanups per year. 
And they are addressing approximately 4,700 sites at any given time.
    This is helping to revitalize our downtowns, prevent urban sprawl 
and preserve our farmland and greenspaces. These programs are cleaning 
up eyesores in our inner cities, making them more desirable places to 
live. Because they are putting abandoned sites back into productive 
use, they are the key to providing jobs to inner city people and 
keeping them off welfare.
    Ohio has implemented a private sector-based program to clean up 
brownfields sites. Ohio EPA, Republicans and Democrats in the Ohio 
Legislature and I worked hard to implement a program that we believe 
works for Ohio. Our program is already successful in improving Ohio's 
environment and economy.
    Mr. Chairman, I would especially like to make one thing clear 
today. I understand that Ohio's voluntary cleanup program has been 
portrayed to Members of Congress, even to this committee, as an example 
of a bad state program that demonstrates the need for Federal oversight 
of state voluntary programs. I could not disagree more.
    In almost 20 years under the Federal Superfund program, U.S. EPA 
has only cleaned up 15 sites in Ohio. In contrast, 77 sites have been 
cleaned up under Ohio's voluntary cleanup program in 4 years. And many 
more cleanups are underway.
    States clearly have been the innovators in developing voluntary 
cleanup programs. And Ohio's program has been very successful in 
getting cleanups done more quickly and cost effectively. For example, 
the first cleanup conducted under our program the Kessler Products 
facility, near Canton was estimated to cost $2 million and take 3 to 5 
years to complete if it had been cleaned under Superfund. However, 
under Ohio's voluntary program, the cost was $600,000 and took 6 months 
to complete. These cleanups are good for the environment and good for 
the economy.
    In particular, I would like to respond to the criticism that Ohio's 
voluntary cleanup program does not provide adequate opportunity for 
public participation. This is just outright false. Ohio carefully 
crafted its program to balance the needs of public participation, but 
not allow for significant delays in the cleanup process.
    The Ohio legislature drafted and debated the legislation which 
governs Ohio brownfields cleanup. The Ohio EPA then provided public 
hearings when it set the cleanup standards that ``standard'' sites must 
comply with under the law. For more complicated sites, or sites that 
require air or water discharge permits, the state follows the public 
participation procedures outlined in the Federal and state laws 
regulating the issuance of permits. The public is involved in setting 
the levels permitted to be discharged.
    In addition, documents used or developed in connection with a 
cleanup under the program are retained for at least 10 years and are 
available to the public on request. Anyone may challenge the Director 
of Ohio EPA's decision that a site is or is not clean enough.
    Mr. Chairman, these are just a few examples. I ask that a summary 
of the public participation opportunities under Ohio's voluntary 
cleanup program be submitted for the record along with a copy of my 
written statement.
    Mr. Chairman, Ohio and other states have very successful programs 
that cleanup sites more efficiently and cost effectively. S. 1090 would 
help build on their success by providing parties assurances that when 
they clean up a site correctly, they will not be held liable under 
Superfund further down the road. This bill creates incentives for more 
parties to come forward under voluntary cleanup programs to clean up 
sites and put them back into productive use.
    I look forward to today's hearing.
    Senator Chafee. In commenting about the question just 
asked, I think one of the things that is forgotten about in all 
of this is the enthusiasm that local governments have for 
cleaning up this wasteland that's out there, not only from an 
environmental point of view, but also from the point of view of 
ridding the city of blighted areas that really add nothing, 
that have the potential of attracting businesses to them and 
creating jobs, jobs that are needed, particularly in a lot of 
our urban areas as we try to move people off the welfare rolls 
to a job. The impact that it has on urban sprawl or the issue 
of farmland preservation.
    It just seems that in the last several years, States and 
local communities have really got the spirit. From our 
perspective, or my perspective, it seems to me to be that the 
Federal Government, instead of trying to be a partner and 
moving the process along in so many instances becomes an 
impediment to moving forward.
    I would think that in response to Senator Baucus' comment 
on that, that you have State legislators that have passed 
legislation dealing with brownfields, they've been thoroughly 
discussed in the assemblies of the States, the Governors have 
had involvement, their EPAs have had involvement, the laws are 
passed, the State environmental protection agency then goes 
about setting rules and regulations that are subject to public 
hearing and so forth.
    Once that's done, it seems to me that you ought to be able 
to move forward and get on with it. I think that what we're 
trying to do with this legislation today is to make that 
possible.
    Would either one of you want to comment about any 
difficulty that you've experienced in moving forward because of 
the Federal involvement?
    Mr. Suozzi. I think you're 100 percent on in your analysis, 
Senator, about what the importance of this issue is, that we 
not only want to clean up the properties, we want to attract 
economic development and we want to stop developing the green 
fields that are out there. I mean, in Long Island, every 
developer that wants to build a new building of some type, they 
look for an old potato field or something like that, or an old 
estate property or an old open space to build a new office 
building or factory or stores.
    So we've got to recycle and reuse these properties. One of 
the first steps that we need to do, as Mayor Marshall has 
talked about, is to assess where these problems are and 
identify them and try and market them and point out that the 
problem may not be as bad as everybody thinks it is. And to do 
that, the main thing that we need is money in the form of 
grants to help us do brownfields assessment. That's something 
that's very important to us at the local level.
    I've found the Administration has been trying very hard 
through the EPA to work with us through different programs, but 
we still need more help.
    Mr. Marshall. Senator, it's interesting, I know a lot about 
the problem, but I can't claim to have a lot of personal 
experience, and I'll tell you why. It's because Macon, middle 
Georgia, suffers from the same sprawl problem that Atlanta and 
any number of other cities suffer from. The economics 
associated with these inner city tracts that absolutely need to 
be redeveloped, they're sitting right in the middle of all 
kinds of neighborhoods where people need jobs, the economics 
simply don't justify much effort.
    I used to represent banks, I'm a law professor, commercial 
lawyer who became a mayor. I used to represent banks. When I 
became the chairman of the Mayors and Bankers Task Force, one 
of the first things I did was call all the bankers, all the 
presidents of all the banks in the city together for breakfast 
to talk about this. Most didn't know what a brownfield was, 
they had never heard the term. This was only a year ago.
    And it's because the market forces make it so much easier 
for lenders to do cookie cutter deals in office parks and what 
have you on the periphery than to try and deal with this 
problem in the heart of the city.
    Now, is it the Federal, the threat of Federal involvement 
and Federal liability? In part, yes. And I have worked with a 
couple of parcels in the inner city, mostly with State 
environmental folks. I can tell you lenders want certainty, 
they want finality. They don't want to get involved in a deal 
where they could wind up getting stung later on or not being 
able to foreclose on the property because some additional 
cleanup work might have to be done. So they're not interested 
in even thinking about a complicated deal like that, let's do 
it on the periphery.
    So I think there are other factors, there are other forces 
that explain this phenomena besides just this one. But this 
force, this factor, environmental laws that make it difficult 
to purchase and difficult to have certainty with regard to 
these inner city properties that already have all the 
infrastructure and people needing jobs surrounding them, those 
laws, yes, are a specter that hang over the entire country.
    In Chicago, the economics may justify a deal. Glen Cove, 
you've got a staircase, if I understood you correctly, Mayor, a 
staircase in Glen Cove that's equal in value to the public 
housing in Glen Cove. We don't have anything like that in 
Macon.
    [Laughter.]
    Mr. Marshall. But Glen Cove, the economics may justify it 
there. In most of the cities, they don't. So you're going to 
have a lot of property that lies fallow in the heart of the 
city.
    And here I am, I'm a typical, modern day American 
businessman, and I come to middle Georgia, and middle Georgia 
is trying to persuade me to put my office park in the old 
industrial district. I drive through that district, and what do 
I see?
    Well, I don't see what you normally see in modern office 
parks. I don't see nicely mowed grass and buildings set back a 
certain distance. What I see is vacant lot after vacant lot, a 
crumbling structure. I'm not going to put my business down 
there.
    So that's the problem we've got that needs to be reversed. 
A lot of factors, the environmental law is just one of the 
factors, sir.
    Mr. Suozzi. And again, the market forces themselves that 
the mayor refers to are the market forces created by the laws 
that make it so difficult to clean up these sites and reuse 
these sites. My property, but for the pollution that I'm 
talking about, is on the north shore of Long Island, 60 acres 
of beautiful waterfront property. But for the pollution and the 
laws that go into cleaning up that pollution and the finger 
pointing that we must go through to get through the process, 
that property would be very valuable.
    But it's because of the uncertainty, it's because of the 
difficulty of navigating the maze of legislation that makes it 
so invaluable. Similar to these city tracts in inner cities, 
these are, right as the mayor pointed out, near to centers of 
infrastructure, near major employment forces, very attractive 
properties but for the problems associated with the laws.
    Senator Chafee. Senator Lautenberg.
    Senator Lautenberg. I thank you, both mayors, for your 
testimony. I am not familiar with Macon, but I am with Glen 
Cove. It is truly a beautiful town, and it wasn't my 
grandparents who lived in those big houses, I can assure you. 
But it's a beautiful coast line.
    New Jersey unfortunately happens to be one of the places, 
we have the largest number of Superfund sites in the country. 
At the same time, New Jersey has the second highest per capita 
income in the country. It's kind of a paradox, we have some 
very poor and we have some very successful people.
    But the cleanup of brownfield sites has had a dramatic 
effect in the communities in which it's worked. I have 
witnessed it personally.
    I would mention to both of you, though, that we're looking 
at a Superfund bill in its totality here. While the focus, I 
think from each of you, has really come to the brownfields 
area, Mayor Marshall, I couldn't help but notice in your 
testimony that you had a general concern, serious concern about 
the proposed termination of the Superfund program at this 
juncture and the absence of a plan to reinstate the feed stock 
taxes.
    I recall that simply to remind everybody that there's a 
much larger picture here. How do you feel, for instance, about 
ramping down the number of sites, slowing down the cleanup of 
Superfund sites generally? Is that something that you would say 
is an appropriate way to conduct the environmental requirements 
of your community, of our country?
    Mr. Marshall. Senator, we have in Macon a, it's either an 
NPL site or it's a Superfund site, it's an old naval ammunition 
manufacturing facility that is now held by an authority of the 
city. I think ultimately the Corps of Engineers is responsible 
for cleanup, but no funds have been allocated to take care of 
the problem, so the site simply sits there.
    I don't know that that site is causing us a great deal of 
grief. It's located in the heart of an older industrial park. 
It's not near neighborhoods and etc.
    Do I want the site cleaned up? Obviously. If funding, if 
changing the Superfund law means that there won't be funds to 
clean up this site, then obviously I'm interested in not 
changing the law and having the funds.
    But the question you asked us to comment on is one that's 
way beyond our scope of expertise and our perspective. I would 
comment, though, sir, that to say that what we're talking about 
is a small part of a bigger problem, may understate the size of 
the part that we're talking about. I think you have the problem 
I described, and Mayor Suozzi described, affecting literally 
hundreds of millions of people int eh United States in a very 
negative way.
    You do have significant national priority Superfund sites 
scattered around the country, and we know some of the names, 
Love Canal, etc. I'm familiar with one that may be that kind of 
site in my community. But I can tell you, that site doesn't 
have as dramatically a negative impact upon the economics of 
the community as all these brownfield sites do. And if you 
accumulate the negative economic impact of having all this land 
lie fallow inside our center cities, I think you'll conclude 
that it's a huge problem, not a small problem.
    It may be necessary for the two to be separated, and for 
somehow, in a bipartisan way, Mr. Chairman, for this committee 
to move forward with some brownfields relief, if it can't do 
the Superfund part of this. I don't know. I just don't know 
enough about this stuff. But I can tell you, it's not a small 
problem.
    Senator Lautenberg. I don't think I used the word small in 
any way, because I am an original author going back to the 103d 
Congress of separate brownfields legislation. I've brought it 
up every year, and every year it's been said to me, Frank, 
don't do that here, let's tie that into the Superfund program 
at large. And maybe that will help pull Superfund along.
    I'll ask you, Mayor Suozzi, should we have a separate 
brownfields bill to take care of the kinds of problems that 
you've both talked about that would have an immediate impact on 
the way our communities are functioning?
    Mr. Suozzi. Let me just say that it's not important to me 
whether it's separate or not separate. What's important is that 
it gets done this year. We need some work done on brownfields 
right away, because it's affecting us very dramatically. We 
think it's something that everybody can agree on. It's not a 
controversial area, it's something that there is bipartisan 
consensus on, and it's important that we get it done as soon as 
possible, because it's affecting us very seriously.
    Senator Lautenberg. Well, you've described it in terms, 
well, it's a simpler problem to digest, it looks like a simpler 
one to solve. Then I think you confirm the fact that we ought 
to get on with, regardless of what we do with Superfund, and I 
frankly am one of those who doesn't think that we ought to cap 
the number of sites we're going to do, I don't think that we 
ought to slow down the pace.
    Superfund has been a very successful program. It took a 
long while to get developed and to get started, but it's been 
successful. Ninety-five percent of the sites have either had 
cleanup starts or remedy solutions produced. And so I want to 
work cooperatively with my friends on the other side to try and 
get something done. But what I get from both of you is get on 
with the brownfields.
    Mr. Suozzi. And with co-disposal landfill relief.
    Senator Lautenberg. I heard that. I'm with that. It's a 
universal problem as well.
    Senator Chafee. OK, Senator Crapo.
    Senator Crapo. Thank you, Mr. Chairman. I have no 
questions.
    Senator Chafee. Fine. We want to thank the panel very much.
    Senator Smith. Mr. Chairman?
    Senator Chafee. Oh, excuse me.
    [Laughter.]
    Senator Chafee. I apologize, Senator Smith.

            OPENING STATEMENT OF HON. ROBERT SMITH, 
          U.S. SENATOR FROM THE STATE OF NEW HAMPSHIRE

    Senator Smith. Sorry I was late. I know you have other 
panels. Just a couple of points.
    Senator Lautenberg, I wasn't here when you spoke, but I 
know that you mentioned that reopening old settlements creates 
problems. In S. 8, that was in the old S. 8 Superfund bill last 
year. That was a serious problem and difference between us.
    But I think you'll find if you look at S. 1090 that we have 
addressed that. It's not in our bill, there's no language on 
reopening old sites. So I might ask you to just take a look at 
that.
    Another comment, you know, as I read your testimony, Mayor 
Marshall, and you talk about State finality, which is really 
where I'm coming from. You testified ``This issue continues to 
be driven by seemingly abstract debates about unreasonable 
constraints on EPA's role. Under existing law we know that EPA 
has rarely, if at all, intruded upon State decisions on non-NPL 
or non-NPL caliber sites. The price of keeping EPA over-
empowered in this area is simply too high.''
    I agree, and we're not going to be able to deal with 
brownfields, Superfund or anything else without State finality. 
Just reviewing, I'm going to ask a question here, but just in 
reviewing, if you think of the bill, when it passed in 1981, 
the so-called Superfund law, I will grant to you that there 
have been some successes, very costly successes, $35 billion or 
$40 billion over the last 15 years in the program. I don't 
think the bang for the buck has been there, to put it mildly.
    But when you think about why you ride down that street and 
see those deserted locations where your businesses don't want 
to go, it's no wonder when we had lender liability, when 
somebody wanted to go clean up that site, the lender was held 
liable. We had contractor liability, so if anybody in there 
tried to clean it up, they were held liable.
    We also had abutter liabilities, so if any of this stuff 
moved over to the next door neighbor, he was liable. We also 
had every purchaser in the chain of title liable. We had joint 
and several liability, so that if you only owned 10 percent of 
the site, you had to pay 100 percent of the site if they 
couldn't find the other guys.
    And we wonder why these things, I mean, the reason these 
sites have not been cleaned up is because of Superfund, period. 
That's why we need to change this all, and that's why we need 
to link, with all due respect, Senator Lautenberg, that's why 
we have to link brownfields with Superfund reform. Because it 
doesn't make any sense to move in one area and not in another. 
Because brownfields could at least have the potential to be 
``Superfund sites,''and that's what we're trying to stop.
    That's why we have spent a lot of time trying to reach 
accommodation here where the differences are, but at the same 
time, keeping fairness, fairness, as the major yard stick here, 
not to be unfair to one and fair to somebody else, but fairness 
and orphan shares is the only way to bring fairness into the 
system and to deal with these other liability problems.
    Let me just ask a specific question, and we'll move on. In 
our bill, in this bill, 1090, we do four things as it relates 
to the State. I would just ask each of you to comment on the 
four. I'll just read the four and you can go back and comment. 
It allows EPA to act at a State site in the following 
situations. In other words, EPA can step in in your State under 
the following situations in this bill, and only under these 
situations.
    No. 1, in an emergency. Something happens, we don't know, 
we can't predict, there's an emergency. It can act second only 
at the request of a State if there's no emergency. Third, if 
the State's remedy fails and the State is unwilling or unable 
to respond, EPA can act. And finally, if contamination has 
crossed a State line which gets into interstate matters. That's 
it.
    Do either of you have any problems with any of those four 
points in the legislation at hand?
    Mr. Marshall. You asked a very narrow question, do I have a 
problem with that. I don't know enough to know whether I should 
have a problem with that.
    I can say that my opinion is, having the State EPD have the 
authority to give final determination in many, many instances, 
is something that would be very helpful. And right now, when 
you talk with, and I've had very limited personal experience 
doing this, but I have done it, when you talk with the 
principally responsible agency for dealing with brownfield 
cleanup problems in the city of Macon, it's the State. You say 
to the State, OK, we worked this out, is that it.
    The State can't bind EPA. And you can't get, you can get a 
comfort letter, I think is what it's referred to, from EPA, 
that this probably won't be a national priority site. But you 
can't get the kind of comfort that lenders would like to have. 
It seems to me if there is a way to limit EPA's role or at 
least give States the freedom to give finality to a certain 
matter and that's it, that would be a big step forward as far 
as dealing with a lot of these problems are concerned.
    Mayors feel that the brownfield problem is by far the 
larger, more significant economic problem, long term 
environmental problem, facing the United States right now, even 
though brownfields typically don't have the level of 
contamination, they don't come even close to the kind of 
contamination that the more specific Superfund sites look at.
    Senator Smith. But the issues are the same, finality, 
liability.
    Mr. Marshall. Right. If there's a way to separate the two 
and give finality readily in a brownfields setting, and then if 
later on you find out that you made a mistake and finality was 
a bad idea, it was a mistake to have granted finality, maybe 
somebody at the State or Federal level is going to have to bear 
some additional cost.
    It just seems to me that the economic value of being able 
to provide finality to thousands and thousands and thousands of 
deals and the effect on the economics of a city is so positive 
that you take a chance on making a mistake. You go ahead and 
give the State actors the opportunity to make some of those 
mistakes. And you move forward and you make decisions. And then 
you go on.
    Now, exactly how you do that, I don't know. I can tell you 
that cities across the country, mayors across the country, sort 
of feel like they're being held hostage in this debate. It 
would be nice if a bipartisan group would come together and we 
could get something done this year that would give some 
brownfields relief.
    [The prepared statement of Senator Smith follows:]
    Statement of Hon. Bob Smith, U.S. Senator from the State of New 
                               Hampshire
    Thank you, Mr. Chairman. I'd like to welcome the witnesses here 
today, particularly those who traveled some distance to be here. 
Several of you are taking time from pressing duties in state or local 
government. Others have taken valuable days off from their businesses. 
We appreciate your presence here today. Mr. Chairman, we do have a 
large number of witnesses who have important testimony to provide, so I 
will keep my comments brief.
    This committee is now in the seventh year of serious work on 
Superfund reauthorization. During the 4 years of my tenure as chairman 
of the Superfund Subcommittee, we and our staffs have spent hundreds of 
hours negotiating issues and identifying areas of agreement with our 
Democratic colleagues on the committee and with EPA Administrator Carol 
Browner. In the markup of S. 8 in the last Congress, we succeeded in 
eliminating many areas of controversy, but were still left with several 
major disagreements over remedy selection and fair liability reform, 
among others.
    At the beginning of this Congress, Administrator Browner and Acting 
Assistant Administrator Tim Fields testified that EPA was interested in 
pursuing legislative reform only in some narrow property owner areas 
and in brownfields. They still seek the Superfund taxes, but have 
abandoned efforts at the comprehensive reform that would justify those 
taxes. Their message was that the Superfund program was ramping down 
and that major reforms would impede that process.
    At the same time, several of our colleagues expressed strong 
concerns about how much we would have to give up in remedy, liability, 
and natural resource damage reforms in order to win the support of the 
Administration. They share my view that taxes should not be reimposed 
on American businesses to support a fundamentally unfair program.
    In the face of those legitimate concerns on our side, and 
confronted with EPA's change of position on the other, Mr. Chafee and I 
decided to try a different course. With the introduction of the 
Superfund Program Completion Act last week, we have taken off the table 
reforms in natural resource damages, remedy selection, and full 
fairness in liability--along with the taxes. Instead, we focus on major 
reforms in six areas.
    Specifically, the Superfund Program Completion Act:

      Directs EPA to finish the job that was started nearly two 
decades ago by completing the evaluation of the remaining sites on the 
CERCLA Information System (CERCLIS).
      Clearly allocates responsibility between states and EPA 
for future cleanups.
      Protects municipalities, small business, recyclers, and 
other parties from unfair liability--while making the system fairer for 
everyone else.
      Provides states $100 million per year and full authority 
for their own cleanup programs.
      Revitalizes communities with $100 million in annual 
brownfields redevelopment grants.
      Requires fiscal responsibility by EPA and saves taxpayers 
money.

    Our legislation will result in more hazardous waste sites being 
cleaned up--and in fewer dollars being wasted on litigation. It will 
give much-needed and much-deserved liability relief to innocent 
landowners, contiguous property owners, prospective purchasers, 
municipalities, small businesses and recyclers. Unlike EPA's 
administrative reforms, this bill does not shift costs from politically 
popular parties to those left holding the bag. Instead, it requires 
payment of a statutory orphan share and authorizes the use of the 
Superfund Trust Fund for those shares.
    Unfortunately, EPA wants to have it both ways on the issues of 
substantial reform and taxes. On the one hand, they tell us that 
substantial reform is not needed because the program is ramping down. 
At the same time, they claim they must have taxes reimposed. Worse yet, 
according to the testimony Acting Assistant Administrator Fields gave 
last month, EPA intends to use those taxes to continue its ventures 
into the commercial real estate business--building golf courses with 
Jack Nicklaus. Let me be clear on this: I will never support requiring 
taxpayers to pay even one penny for an EPA golf course.
    The only way I will support reimposing taxes is if the funds are 
used to pay for full reform of the Superfund program. I pledge to 
continue working for full reform of the program, but I firmly believe 
we must do what we can in this Congress. The Superfund Program 
Completion Act is achievable, strong reform.
    Thank you, Mr. Chairman.
    Senator Chafee. We've got to move on. Mayor Suozzi.
    Mr. Suozzi. I just want to echo that again. I'm here about 
brownfields, and I'm here about co-disposal landfill relief. 
The issues you point to are very important, Senator. One big 
problem that small municipalities like mine, as well as large 
municipalities, is having to navigate the maze of so many 
overlapping jurisdictions on different issues.
    It's very difficult, I'm a city of 25,000 people, we're 
busy picking up the garbage and making sure the cops do their 
jobs and paving the roads. These are big, complex issues for us 
that are really overwhelming at times, which is one of the 
reasons we need help with funding. Private parties just aren't 
going to do it. It's just too much of a headache for them to 
get involved.
    We've got to take a leadership role, and we don't have the 
resources to do it. We need help on something we know is 
clearly definable right away, which is the brownfields issue. 
It would provide tremendous economic and environmental benefit 
to a lot of people.
    On the issue that you talk about specifically, it would be 
great if we could get the States and the Federal Government 
together, and it would be great if we could get the Democrats 
and the Republicans together with a solution on this issue. But 
if it's going to hold up everything else, then I'm not in a 
position to comment on it, because I'm not educated well enough 
on the issue.
    But we're having a hard time out here. We just want to do 
the right thing, we want to do our jobs as government, which is 
provide the infrastructure, provide the opportunity for people 
to make private investment. We need your help to get that done.
    Senator Lautenberg. Mr. Chairman?
    Senator Chafee. Frank, you can make a quick comment, but 
we've spent 1 hour on two witnesses. We have 11 witnesses to 
come.
    Senator Baucus. Mr. Chairman, that's true, but the Senators 
have not spoken nearly as long as have the witnesses.
    Senator Lautenberg. And I've been on especially good 
behavior.
    Senator Chafee. I'm not sure I'd mark that, but I guess I 
would give you a high----
    Senator Lautenberg. I'm listening.
    [Laughter.]
    Senator Chafee. All right, go ahead, quickly, please.
    Senator Lautenberg. I just want to respond to Senator 
Smith's comment about not reopening. As a matter of fact, if 
the bill does require allocations that would be, that EPA might 
have already made, and not taken care of some unaddressed 
costs, which would allow the subject to be reopened and 
reallocated if that's a determination. Is that not true?
    Senator Smith. I'd like to see the reference on that.
    Senator Lautenberg. Section----
    Senator Smith. You're talking about unaddressed costs. If 
they're not addressed, they're not reopened.
    Senator Lautenberg. Page 77. Well, it says, shall include, 
list facility not addressed in the settlement or before the 
date of enactment, not later than 180 days.
    Senator Smith. Not addressed, etc.
    Senator Lautenberg. But EPA has to do an allocation at all 
sites. Go back and look at any unaddressed costs.
    Senator Smith. Well, they're addressed. If they're 
allocated, they're addressed. This is not addressed. That's 
what we're saying. I think you're misreading it.
    Senator Lautenberg. Well, at least we know that there's an 
open question.
    Thanks very much, Mr. Chairman.
    Senator Chafee. All right, gentlemen, thank you very much 
for coming. We appreciate it, and safe journey home, both of 
you.
    Mr. Suozzi. Senator, again, I want to invite you and Mrs. 
Chafee down to Glen Cove, come down to her old home ground some 
time and see our redevelopment project.
    Senator Chafee. We were married in Oyster Bay, how's that?
    Mr. Suozzi. Great. Come down and I'll re-perform the 
ceremony.
    [Laughter.]
    Senator Chafee. OK, thank you very much.
    Now let's have the next panel step right forward, please. 
Mr. Tom Curtis of the National Resources Governors' 
Association; Claudia Kerbawy; Gordon Johnson; and Vernice 
Miller.
    Mr. Curtis, go ahead.

  STATEMENT OF TOM CURTIS, DIRECTOR, NATURAL RESOURCES GROUP, 
                NATIONAL GOVERNORS' ASSOCIATION

    Mr. Curtis. Thank you, Senator Chafee. Good morning, 
Senators, Senator Baucus, other members of the committee.
    My name is Tom Curtis, I'm here representing NGA this 
morning. I'll introduce my statement for the record and 
summarize very succinctly for you.
    I would like to start by saying that the National 
Governors' Association wholeheartedly agrees with the 
sentiments expressed by the mayors on the first panel about the 
importance of finality as a tool for returning brownfield sites 
into productive use. There are thousands upon thousands and 
thousands of such sites, probably hundreds of thousands of 
acres of property around the Nation that is essentially 
mothballed, because the owners have a pervasive fear of 
liability under the Superfund program.
    Under the current liability system, if such a property were 
addressed even to the satisfaction of a State, EPA could 
nonetheless apply the Federal liability scheme to the party who 
is owning or attempting to return that site into use. The fear 
of such liability without question hinders the redevelopment 
and reuse of such sites. It is very important that the Congress 
address that issue.
    We think that your bill does so appropriately. You include 
reopeners that we believe are appropriate for the case in which 
there may be new information or a change of conditions at that 
site, or the case in which a State requests EPA to come back in 
to a site. Those reopeners, we think, are important and 
appropriate.
    But clearly, that is a significant issue of national 
interest that the Congress has to address.
    I would also like to speak to the provision in your bill 
that requires an invitation by a Governor before a site can be 
listed on the national priorities list. We believe that is a 
very important provision. The States have matured enormously in 
their programs. The State programs are now just as 
sophisticated as EPA's program is, in many respects. EPA, by 
the way, deserves a lot of credit for that. The EPA has 
supported States over the years and helped States mature.
    While EPA has probably made cleanup decisions or even 
initiated construction at 90 to 95 percent of the sites on the 
NPL, tens of thousands of sites lie off the NPL that are being 
addressed by these very good State programs. It does not make 
sense to have two masters at any of those sites. We believe 
that where there's a Federal interest in a site, it should be 
listed on the NPL. But if a State had the capability and the 
desire to address any site, it should have the first choice, 
and EPA should only add a site to the NPL with a clear 
concurrence by the State.
    Finally, I would close my remarks by commenting on a couple 
of other provisions in your bill. We very much appreciate the 
financial support for site assessment and for addressing sites 
and for State brownfield and cleanup programs. We very much 
appreciate the important provisions you have here to change the 
State share of operating and maintenance costs to 10 percent. 
We think that too is a very important piece of this bill, and 
we urge you to maintain that.
    I guess finally we would simply urge you to try to get the 
bill done this year. As you know, Senator, the Governor's 
Association is a bipartisan organization. Our policies can only 
be adopted by a vote of two-thirds of the Governors and 
typically are adopted by a much more impressive majority. Our 
Superfund policy is such as policy, it was overwhelmingly 
approved by the Governors. They don't come at this as a 
partisan issue.
    We urge all Members of the Congress, both sides of the 
Congress, and certainly both sides of the aisle here, to reach 
across the aisle in a spirit of bipartisanship, try to get the 
bill done. We need you to send a bill to the President this 
year that he can sign. Let's please work together.
    The Governors stand willing to help you in any way that 
they can to try to get that job done this year. Thank you.
    Senator Chafee. Thank you, Mr. Curtis.
    Ms. Kerbawy?

    STATEMENT OF CLAUDIA KERBAWY, CHIEF, MICHIGAN SUPERFUND 
  PROGRAM; SPOKESPERSON, ASSOCIATION OF STATE AND TERRITORIAL 
                SOLID WASTE MANAGEMENT OFFICIALS

    Ms. Kerbawy. Good morning, chairman and members of the 
committee. My name is Claudia Kerbawy and I am Chief of the 
Michigan Superfund Program and the primary spokesperson on 
reauthorization of the Association of State and Territorial 
Solid Waste Management Officials. I am here today representing 
ASTSWMO.
    As the day to day implementers of the State and Federal 
cleanup programs, we think we offer a unique perspective to 
this dialog, and we thank you for inviting us here.
    ASTSWMO and individual States have participated in the 
Superfund reauthorization debate for the past three Congresses. 
I would like to dedicate the first part of my testimony to 
speaking on the accomplishments of State programs which have 
had 18 years to grow and mature into the leaders in remediation 
today.
    ASTSWMO recently conducted a study on removal and remedial 
actions performed by States between January 1993 and September 
1997. NPL sites, RCRA corrective actionsites, storage tank and 
other petroleum sites were not included in the study. The 
Association received information on 27,235 sites from 33 
responding States. Information had to be site specific and had 
to be accompanied by background data. Estimates were not 
accepted or counted in the survey.
    Results of the survey showed that those 33 States are 
completing an average of 1,475 sites per year, for a total of 
6,768 completions. They are completing an average of 485 
removals per year, and are addressing on average approximately 
4,700 sites at any given time. Only 8.9 percent of the sites 
identified in the survey were classified as inactive.
    Although this study does not capture the complete site 
universe either on a national or individual State level, it 
does confirm that on a national level, States are addressing 
and completing response action at the bulk of the sites.
    The next part of my testimony will be devoted to analyzing 
key aspects of S. 1090 from a State program manager's 
perspective. We support the provision for Governors' 
concurrence with NPL listing as outlined in S. 1090. Most 
identified sites in the State that could qualify for listing on 
an NPL are already being addressed by the States.
    While there may be 40 plus States that have Superfund 
programs and voluntary cleanup programs, there will always be 
sites which due to either technical or legal complexity or 
cost, a State either cannot address or may prefer to have the 
Federal Government address. The NPL is no longer reserved for 
the worst of the worst sites, rather, the NPL has shifted to a 
venue for remediating sites which require Federal resources.
    The NPL should be reserved for those sites which both the 
State and Federal Government agree warrant expenditure of 
Federal resources as provided for in S. 1090.
    States are responsible for remediating the vast majority of 
sites in the country and must be allowed to determine when a 
site is fully remediated. CERCLA technically applies to any 
site where release occurs. However, the reality today is that 
States are responsible for ensuring the remediation of all 
sites which do not score high enough for listing on the NPL. 
The EPA removal program is able to address some sites which are 
not listed on the NPL, but the program is designed to stabilize 
a site, not ensure that the site reaches full remediation.
    EPA does not have the authority to expend fund money or to 
require other parties to fund remediation at a site not listed 
on the NPL. Although the majority of these typically brownfield 
sites will never be placed on the NPL, they are still subject 
to circle of liability, even after the site has met State 
requirements.
    We can no longer afford to foster the illusion that State 
authorized cleanups may somehow not be adequate to meet Federal 
requirements. The potential for EPA over-file and for third 
party lawsuits under CERCLA inhibits brownfield cleanup and 
redevelopment. States should be able to release both Federal 
and State liability once a site has been cleaned up to State 
standards. Legislation which addresses these issues, as does S. 
1090, is critical.
    We are also very pleased that S. 1090 seeks to streamline 
the program by providing a fixed 10 percent cost share across 
the board. Under the status quo, the financial incentive for 
EPA and the States are diametrically opposed when considering 
final remedies for a site. State waste officials believe that 
S. 1090 presents a fair and well reasoned approach to this 
issue.
    Clearly, implementation of CERCLA over the years has 
identified a level of unfairness in its liability system. 
However, we will leave the analysis of the liability reforms in 
S. 1090 to other State experts.
    In conclusion, while our membership has not yet conducted 
an in-depth review of S. 1090, or reached consensus on the 
bill's language, the initial impressions and reaction from our 
members is favorable. We are very encouraged and look forward 
to working with the committee as the process continues.
    Senator Chafee. Thank you very much, Ms. Kerbawy.
    Mr. Johnson?

STATEMENT OF GORDON J. JOHNSON, ASSISTANT ATTORNEY GENERAL, NEW 
                              YORK

    Mr. Johnson. Good morning. My name is Gordon Johnson, and 
I'm a Deputy Bureau Chief of the Environmental Protect Bureau 
of the New York Attorney General's Office. I'm appearing today 
on behalf of Attorney General Elliott Spitzer and on behalf of 
the National Association of Attorneys General, NAAG. We very 
much appreciate the opportunity to appear before the committee, 
and we thank the chairman and staff of the committee for the 
consideration and assistance.
    NAAG has been deeply involved in the Superfund 
reauthorization process for many years. At its summer meeting 
in 1997, the sole resolution adopted by the Attorneys General 
addressed Superfund reauthorization. A copy is submitted with 
our written statement.
    While the State agencies that administer cleanup programs 
are very knowledgeable about the engineering issues involved in 
selecting remedies in the cleanup process, it is the State 
Attorneys General who can best evaluate the legal consequences 
of changes to the current statutory scheme, such as how 
amendments are likely to be interpreted by the courts and their 
effect on enforcement, settlement and cleanup. We are pleased 
that we will be able to bring to this committee our insight and 
experience.
    Although there were significant problems in the Federal 
implementation of CERCLA during the 1980's, the current statute 
is now getting the job done. In New York, because of the powers 
provided in CERCLA, the State has obtained cleanups at over 600 
hazardous waste sites. Responsible parties have contributed 
more than $2 billion to site cleanups and two-thirds of the 
sites are being cleaned by private parties.
    Most States have had similar results. On a Federal level, 
some $10 billion of public money has been saved because 70 
percent of all remedial actions at Federal Superfund sites are 
being performed by responsible parties. A major reason for this 
success in the cleanup is that the cleanup liability under 
CERCLA is now clearly understood.
    It wasn't always this way. In the 1980's, there was 
resistance and contentious litigation that caused delays in 
cleanups, imposed substantial burdens on government programs 
and increased everybody's transaction and cleanup costs. Now, 
most PRPs understand the statute and are ready to settle their 
liability with government.
    EPA's practices also have evolved, resulting in early 
settlements and the quicker implementation of remedial 
decisions. State Superfund programs have matured, many of which 
are modeled on the Federal program and use the Federal statute 
to get appropriate cleanups at minimal taxpayer expense.
    The message to us is clear. We must avoid changes to CERCLA 
that will reignite the courtroom battles over the meaning, 
scope and implications of the law. At the same time, we must 
not lose sight of our primary goal, cleanup of sites and 
protection of the public and future generations.
    We are pleased to note that S. 1090 is a departure from 
earlier bills. The bill contains some of the revisions that 
have been sought by the States for years, such as the cap at 10 
percent for the State share of remedy operation and maintenance 
costs. S. 1090 is also selective in its reforms and does not 
amend the remedy selection and natural resource damages 
provisions of CERCLA to any great extent.
    As a result, the defense bar will have fewer opportunities 
for legal challenges than under earlier bills. We are pleased 
that the bill includes a brownfields revitalization program and 
allows States to give cooperating PRPs protection from 
liability under certain circumstances, measures that will 
assist States in implementing their voluntary and brownfields 
cleanup programs.
    Unfortunately, other needed revisions we have been seeking 
for many years are absent, including, one, clarification of the 
waiver of sovereign immunity regarding Federal facilities. 
Federal agencies need to be treated the same as any other 
liable party, and they still are not. Two, natural resource 
trustees should be able to utilize the fund to perform natural 
resource damage assessments. Three, the statute should make 
clear that remedies selected by States are reviewed on the 
administrative record.
    There are still serious problems, nonetheless, with S. 
1090's revisions to the liability and allocation provisions of 
CERCLA. While NAAG supports limited exemptions from liability 
for truly de micromis parties, and a reasonable limitation on 
liability for municipal solid waste disposal, many of the 
provisions of S. 1090 are unclear or go too far.
    The proposed mandatory allocation process is unwise and 
rather than making settlement easier and quicker, will 
complicate and delay settlements and cleanups. Cleanups should 
come first, not arguments.
    Most critical, however, is the apparent de-funding of the 
Superfund program which necessarily will shift hundreds, if not 
billions of dollars in costs to the States. We all wish there 
was no need for CERCLA and the Superfund program. But there is, 
and there will be for many years. When EPA lacks the funds to 
perform, the burden will shift to the States. There are enough 
unfunded mandates for us already.
    Finally, the new liability exceptions and the limits on 
listing new sites will seriously erode the operation of the 
Superfund program inevitably shifting the cleanup costs to the 
States. Thank you for your attention.
    Senator Chafee. Thank you.
    Ms. Subra, we've pulled you up from a later panel. You're 
from New Iberia, Louisiana, representing a company.
    Ms. Subra. Yes, sir.
    Senator Chafee. Why don't you go ahead?

 STATEMENT OF WILMA SUBRA, SUBRA COMPANY, NEW IBERIA, LOUISIANA

    Ms. Subra. Thank you. My name is Wilma Subra, and I work 
with grass roots groups across the United States dealing with 
Superfund issues. I have also served as the technical advisor 
to the National Superfund Commission.
    The Superfund Completion Act, as is presented here today, 
would limit and weaken the Superfund program and result in 
continued environmental damage and human health impacts from 
sites that would not be allowed to be addressed by this 
program. The bill limits the number of new NPL sites, it 
reduces the level of funding for the program. It encourages 
State programs to assume program responsibility in States that 
lack the financial and technical resources as well as the 
political will to carry out the program.
    It also limits and in some cases eliminates entirely public 
participation in the process. It discourages voluntary cleanups 
by potentially responsible parties at sites prior to them being 
listed on the NPL. It places at risk communities that live on 
or new fund led sites where the remedies would only be 
containment.
    A containment remedy is currently being implemented by EPA 
at the Agriculture Street Landfill Superfund Site in New 
Orleans, Louisiana. The remedy is being paid for totally by 
fund money. The landfill is 95 acres and was operated by the 
City of Orleans from 1909 to 1965. Then the city, in 
conjunction with HUD, developed 47 acres of that landfill as 
private and public housing, a recreation facility and an 
elementary school.
    The containment remedy consists of removal and replacement 
of two feet of soil and waste in only 10 percent of the 
residential area. Only the exposed soil and waste areas will be 
addressed, not that under the structures, under the streets and 
under the sidewalks. When the remedy fails, and it will fail, 
due to subsidence, shallow ground water and the area being 
located below sea level, resources from the fund would not be 
available under the proposed bill to finance the measures 
necessary to fix the containment remedy.
    This is just one example of the many sites where 
containment was utilized at fund led sites, where the citizens 
will lose in the long run when the containment remedy fails and 
fund resources are not available to go back in and repair the 
remedy. Those citizens are actually here in Washington right 
now, trying to get relocated. They will be speaking with the 
Appropriations Committee to see if they can come up with some 
money.
    The requirement that a Governor request a site be listed 
will severely limit the sites proposed for NPL. Governors will 
be reluctant to request that the EPA add sites to the NPL when 
the potentially responsible parties at those sites are his 
financial campaign contribution. The only sites a Governor may 
request be added to the NPL are sites that are 100 percent 
orphan. In States that lack financial resources or political 
will, such orphan sites already fall to EPA to fund the 
cleanup.
    The requirement that a Governor request a site be added to 
the NPL completely eliminates the ability of citizens to 
petition to have sites listed. In the State of Louisiana, the 
majority of the NPL sites were listed as a result of citizen 
involvement. The elimination of the citizen petition process is 
not appropriate. Allowing the State Governors to have the 
ultimate authority over the listing of sites prolongs the 
exposure of citizens living and working on or near the site and 
citizens consuming aquatic and terrestrial organisms that are 
contaminated by the site.
    To States again that lack the financial resources to 
address the site, they lack the responsible parties, the limits 
again will be a burden that they will not be able to address. 
The burden will continue to be borne by the citizens living on 
and adjacent to these sites.
    CERCLA is being required to be all the CERCLA sites 
addressed in 2 years. Those sites then will become a problem 
for the States. It is doubtful that the EPA has the financial 
and technical resources to investigate the more than 10,000 
CERCLA sites, and the States definitely do not have that 
ability to address these issues.
    State response programs, as you have it there, lack 
elements of a minimum standard for a State program and a 
mechanism by which EPA is required to evaluate and approve a 
State program. States could basically isolate the public and 
the impacted communities from participating in the State 
program.
    I have other issues included which you can read in the 
testimony. And in conclusion, the Environmental Protection 
Agency must retain the regulatory authority and financial 
resources necessary to address all the sites that qualify for 
Superfund designation. The authority is also necessary in order 
to encourage involuntary cleanups by PRPs. The EPA further must 
have the authority and resources necessary to address these 
hazardous waste Superfund problems in States that cannot 
address the problem.
    In order to protect human health and the environment, the 
Superfund program must not be completed, but must be allowed to 
continue to address the remaining problem sites, as well as the 
new sites that are being created. One of the issues at the 
military basis has been prochlorate. I spent last week in Texas 
with EPA, and this has opened up a whole new area that will 
have to be addressed under the Superfund regulation. So there 
will be new sites and new issues developed.
    Thank you.
    Senator Chafee. Well, thank you, Ms. Subra. I'll put you 
down as lacking enthusiasm for our bill.
    [Laughter.]
    Ms. Subra. We're willing to work with you.
    Senator Chafee. I see. I just have one question, Mr. 
Curtis, you've heard the testimony from the prior panel about 
finality. I think finality is going to be a key element here as 
we try to move ahead and work out some kind of a compromise. 
What finality means is that a Governor, under our legislation, 
would be able to say, we're going to clean this up and this is, 
we believe this is clean now.
    But one of the arguments against that is that the Governors 
will be easy on this and there will be sort of a race to the 
bottom in connection with the control over the sites, the 
creation of pollution havens by the Governors. I find that 
argument difficult to follow. Any Governor is responsible to 
his citizens. Could you give me some thoughts from the 
Governors' association representing the Governors? We've got a 
former Governor here from Ohio. I can only believe that he was 
very conscious of his citizens' desires, and he's not going to, 
I presume, not going to----
    Senator Baucus. You have a former Governor from Rhode 
Island, too.
    Senator Chafee. Yes, he's a very thoughtful fellow, also.
    [Laughter.]
    Senator Chafee. He's just not going to willy nilly approve 
something just to get it approved if the consequences are 
potentially dangerous or harmful to his citizens. Could you 
give me an answer from the Governors' Association?
    Mr. Curtis. Yes, sir, I'd like to second what you just 
said, actually. There's no reason to believe that Governors 
would be easy on this problem, for a number of reasons. First 
of all, there is no constituency for pollution. You don't get 
votes in any election by hiding sites and sweeping these 
problems under the rug.
    Governors run in State-wide elections and have to appeal to 
large numbers of voters. You simply don't present yourself as 
appealing in today's body politic if you are associated with 
hiding these problems, being soft on these problems. So there's 
nothing to gain by any Governor for hiding these sites.
    Moreover, every State that has adopted a cleanup program, 
and there are 45 or 47, I believe, States that have adopted 
programs, have actual cleanup standards that apply. In every 
State, those standards apply both at NPL cleanups and at State-
led cleanups, cleanups that are conducted by the State under 
its authorities, or sites that are cleaned up under a voluntary 
cleanup program. We're not proposing that that would change, 
and your bill doesn't change that. So those standards would 
very much apply at these sites.
    Senator Chafee. Senator Baucus.
    Senator Baucus. Thank you, Mr. Chairman.
    Mr. Johnson, I have two questions. One is, your point that 
this legislation before us would create an unfunded mandate, in 
effect, I guess so much of the pace of cleanups, and the second 
question is with respect to caps, the NPL cap.
    On the first, the question really is, why do you think it's 
an unfunded mandate? I think you have a point insofar as an 
analysis of the bill. It seems to indicate that the pace of 
cleanup will slow down because of the combination of spending 
cuts and cost increases. That is, the bill reduces 
authorization of the cleanup program by about 25 to 30 percent 
from current authorization levels, and also creates new 
requirements that would increase costs, at least by some 
estimates, up to $100 million a year. And it creates a large 
new orphan share that could displace cleanup spending.
    Would you indicate again why you think this bill will 
create an unfunded mandate, and why cleanups will be left to 
the States, in some respect?
    Mr. Johnson. Yes, Senator. Under the bill, there are new 
exceptions for liability at NPL sites, in particular, as well 
as some of the other sites. If EPA does not have sufficient 
moneys to fund those particular shares, cleanup will stop. If 
cleanup stops at sites, quite simply, the States are going to 
have to step in.
    We can't afford to have a cleanup stop, because we have an 
obligation to protect our citizens. So States will go in and 
spend their money.
    But they will be subject to the restraints on recovery 
against various types of formerly liable parties because of the 
new exemptions for liability at NPL sites.
    Senator Baucus. And combined with the authorization 
decrease.
    Mr. Johnson. Particularly combined with the authorization 
decrease. We have a very significant fear there. While there 
have been some good changes in the bill, for instance, our O&M 
costs now are capped at 10 percent, we're still going to end up 
paying that 10 percent. If there isn't enough funding, we're 
going to pick up more. And we're still going to have to pay our 
share, our 10 percent share of those orphan shares, and the 
other costs that are now going to be picked up by the fund. 
Quite simply, not every State has the money to do that.
    Senator Baucus. Mr. Curtis, what do you think about that? 
You said Governors want to be responsible, want to clean up 
sites. But if the Federal money isn't there, does that mean the 
States will have to pay the bill to clean up the sites?
    Mr. Curtis. Senator, I can't comment specifically on the 
bill in that regard, because we have not yet completed our 
review of it. I would say that the Governors have been 
concerned about a shift in costs to the States as a consequence 
of any liability reform. So we would want to make sure there is 
not a cost shift.
    Senator Baucus. Back to you, Mr. Johnson, on the NPL cap. 
Essentially, as you probably know, GAO asked EPA as well as 
States where they thought, the number of sites they thought 
would be added to the NPL in the foreseeable future. EPA said 
there would be about 126. States thought there would be about 
132 listed. They agreed in only about 26, which is interesting 
in and of itself.
    But the point is that there are quite a few additional 
sites that are not yet on the list. The bill has a cap of 30 
per year.
    Now, does that make sense? I'm concerned about the 
arbitrariness of caps. I can remember in the Safe Drinking 
Water Act not too many years ago, we required EPA to name 25 
new contaminants, standards for 25 new contaminants a year, 
irrespective of the science. Of course, that's dumb. We've 
changed that. We went back to EPA and said, well, find out 
which contaminants exist and which ones should we create 
standards for.
    At some time, we also put a cap on new endangered species. 
We realized that was a little bit silly.
    So if we want sound science, and many of us do, does it 
make sense to have a cap where sound science might indicate 
that there should be a thiry-first site, that is, a site more 
than 30 that meet the criteria of 28.5 and should be on the 
list?
    Mr. Johnson. As we detail in our written testimony, we 
think the idea of a cap is a very bad idea. No. 1, for the 
reason that you just elaborated, it's bad science. If a site 
needs to be listed, it should be listed. And it shouldn't be, 
there shouldn't be an arbitrary cap.
    The second reason that it's important, though, is that by 
having the ability to list sites, people come in and agree to 
clean them up, because they don't want to be put on the NPL. If 
you remove that so to speak gorilla in the closet, that fear of 
listing, people are going to stop cooperating with State 
programs to a certain degree, and we're not going to be able to 
get the same number of cleanups. What that means, of course, is 
that the States are going to pick up those costs, another 
element of the bill that concerns us particularly, because it's 
going to shift costs to the States.
    Senator Baucus. Right. And I might say, 30 is in the ball 
park of what EPA estimates it will put on the list. EPA 
estimates it will the list between 25 and 40 sites a year. 
That's an estimate, they don't know for sure. The average over 
the years has been about 20. One year I think there were 300.
    But the point really is, if EPA's estimate is pretty close, 
doesn't it make sense to let there be some flexibility rather 
than an arbitrary number, because 1 year it might make sense, 
and in another year, it might not make sense.
    Mr. Johnson. We think that if you put a cap on it, you're 
going to have a need to list more sites. Because we think that 
when States and EPA estimate how many sites are likely to be 
listed, they take into consideration how many sites are going 
to be cleaned up voluntarily or through settlement and aren't 
going to need to be on the NPL and won't need Federal moneys.
    If you remove that ability to list a site by arbitrarily 
setting an upper limit, I think there's going to be less 
settlements and more likely you're going to have PRPs say, 
well, list the site. We don't care. We're not interested in 
cleaning it up, because they know that the site has less of a 
chance of being listed because there's a cap on the number of 
sites that are being listed.
    Senator Baucus. Thank you.
    Senator Chafee. Senator Crapo.
    Senator Crapo. Thank you, Mr. Chairman.
    Mr. Curtis, in the legislation we're considering here, are 
there any proposed limitations on the EPA using Section 106 
orders to complete cleanup actions? What I'm getting at is 
this. If the EPA found that the NPL cap was too restrictive and 
began to use 106 orders to circumvent the restriction, would 
the public and State participation be increased or reduced, or 
what would the impact be?
    Mr. Curtis. I'm not aware of any restrictions on 106 order 
authority in this bill. I'm happy to look at it more carefully 
and respond to your question in writing. But I am not aware of 
any restrictions on 106 authorities in this bill. I don't think 
that EPA's authorities are limited in that sense under this 
bill.
    Senator Crapo. I don't think there are restrictions on 106 
authority in the bill, and if that's correct, what would the 
impact of that be on the ability of us, of the EPA to 
essentially avoid the NPL cap restrictions and basically order 
cleanup outside of the whole process that the bill 
contemplates?
    Mr. Curtis. Well, EPA could use its 106 authorities to 
order cleanups. Whether or not that authority would be as 
effective without an ability to threaten, at least, a listing 
on the NPL than a fund financed cleanup and a cost recovery 
action, I think we'd have to analyze and think about whether or 
not there might be some secondary effects of that kind.
    Senator Crapo. You've also heard today in some of the 
discussion the fact that one of the concerns that some raise is 
that the bill does not reauthorize the Superfund taxes. Do you 
or do the Governors have a position on that issue?
    Mr. Curtis, Senator, we do not have a view on that issue at 
this time.
    Senator Crapo. All right, thank you.
    Ms. Kerbawy, I'd like to get your reaction to the same 
questions. What do you think of the fact that the bill does not 
limit what Section 106 authority does in terms of achieving the 
kinds of reforms that are necessary?
    Ms. Kerbawy. Well, there are a couple of things there I 
think we need to consider. One is that most of the responsible 
party work that's been done under Superfund has been as a 
result of EPA's ability to actually fund and cost recover for 
response actions rather than moving forward into enforcing an 
order that's been issued.
    So I think although EPA does certainly issue orders, I 
think the primary impetus to make responsible parties move 
forward has been their ability to go ahead and fund a remedy if 
a responsible party refuses to implement the remedy. I think 
probably they could issue the 106 orders, but the effectiveness 
of being able to move forward without have a site on the NPL 
and the ability for EPA to then fund a remedy will limit their 
ability to move remedies forward with 106 order authority.
    The other thing I see happens there is if there is the 
ability to have State finality onsites, if they are not on the 
NPL, that will allow work to proceed at the State level to get 
the sites cleaned up.
    There is in this bill also the provisions that emergency 
actions certainly can be taken by EPA or could be ordered by 
EPA if there is a critical need, environmental or human health 
need to get work done. So I think that work should be able to 
proceed that needs to proceed, either under State authority or 
Federal authority, but there won't be the overlap that we 
currently have now.
    Senator Crapo. Does ASTSWMO have a position on the 
reauthorization of taxes?
    Ms. Kerbawy. Our primary concern is that the work can be 
funded that needs to be done either at the Federal or the State 
level. Whether that is through tax reauthorization of whether 
that is through some other funding mechanism will be left to 
Congress and to the Governors to deal with those positions.
    Senator Crapo. I take it then that if the taxes were to be 
reauthorized, that would not then cause ASTSWMO to oppose this 
bill? In other words, if a reauthorization of taxes was added 
to this legislation, would ASTSWMO still support the bill?
    Ms. Kerbawy. I don't think that would cause us to not 
support the bill.
    Senator Crapo. Mr. Curtis, that's what I understood from 
your answer as well, is that correct?
    Mr. Curtis. That's correct.
    Senator Crapo. Mr. Johnson, same questions. On 106 
authority, does that cause you any concern, the fact that 106 
authority is not addressed in the bill?
    Mr. Johnson. I don't think we've looked at it that closely 
with respect to that particular issue. So we'd be happy to 
answer any questions and get back to you on that. We think, 
though, it's important that EPA retain authority to issue 106 
orders.
    We did in our written testimony note that during the 
allocation process, there are restraints on EPA's ability to 
issue 106 orders. We think that is a serious problem. We don't 
think that Superfund should be an argue first and then clean up 
program. But it should be clean up first, and then argue.
    If you have restraints on EPA's ability to issue 106 
orders, particularly during the allocation process, we don't 
think that's a very good idea.
    With respect to taxes, the Attorneys General are concerned 
that there be a consistent revenue stream, so that we don't run 
into a problem during the appropriations process or at other 
times, and EPA lacks sufficient funds to do what it's required 
to do under this statute. So I don't see any problem from an 
Attorney General's perspective with respect to an authorization 
of the tax.
    Senator Crapo. Thank you.
    Senator Chafee. Thank you, Senator. Senator Lautenberg.
    Senator Lautenberg. Thanks very much.
    Mr. Curtis, just to clarify, does the Governors' 
Association favor a cap on the NPL?
    Mr. Curtis. No, sir. We understand there have been a lot of 
concerns and a lot of discussions about ramping down the 
Superfund program, as EPA comes near the end of the work at the 
sites currently listed on the NPL. We believe that the 
appropriate way to address the concern about the future of the 
program is by giving the Governor the right of concurrence on 
new sites on the NPL. We think that would take care of that 
problem.
    Senator Lautenberg. Concurrence or initiation?
    Mr. Curtis. Our policy actually asks for a Governor's 
concurrence. The bill before the committee addresses that 
recommendation by requiring a Governor to invite a listing.
    Senator Lautenberg. Right. So that's not a position favored 
by the NGA?
    Mr. Curtis. A strict reading of our policy would suggest a 
Governor's right of concurrence with a new listing on the NPL.
    Senator Lautenberg. That's quite different. Do you think, 
Mr. Curtis, that we ought to maintain the pace of the cleanups?
    Mr. Curtis. Well, Senator, again, I believe that there will 
be a natural change in the pace of cleanups as EPA comes to the 
end of the work at the sites currently on the NPL. I don't know 
what the pace will be in the future. I think that goes to the 
question on the cap, whether there are 20 sites or 50 sites or 
100 sites that may be listed on the NPL in the future, that 
would be the appropriate pace we would say.
    Again, urging you to give the Governor the right of 
concurrence with those new listings, so that there is not 
duplicative work, nobody benefits when EPA and the State both 
have the resources to address a site, and in that case, one 
level of government should address the site.
    Senator Lautenberg. But you wouldn't, your organization 
wouldn't necessarily favor a slowdown in the pace of cleanups?
    Mr. Curtis. Well, again, we believe that there will be a 
natural change in the pace of the Superfund program.
    Senator Lautenberg. As sites are cleaned up.
    Mr. Curtis. As sites are cleaned up. We do not have a 
position specifically recommending that Congress legislate the 
shape of the program or the shape of the curve as the program 
ramps down in the future.
    Senator Lautenberg. So do you think there will be a natural 
decline in the pace based on cleanups, or do we have a few more 
sites that ought to be paid attention to?
    Ms. Subra. There are a number of sites that need attention. 
I think if the financial resources are there, the level of 
effort should be the same. Because I think overall, the level 
of effort is being driven by the financial resources. But we 
have a lot more sites to be addressed.
    Senator Lautenberg. There's a November 1998 GAO study that 
stated, officials of about half the States told us that their 
State's financial capability to clean up potentially eligible 
sites if necessary is poor or very poor.
    Ms. Kerbawy, are you familiar with that?
    Ms. Kerbawy. Yes, I am. I think that certainly funding for 
Superfund type of remedies, if States were to have to bear all 
of the costs of sites that were on the NPL, that would be an 
unfunded mandate similar to what Mr. Johnson said. But right 
now, we don't see that that information, as far as the States 
that don't currently have funding, actually correlates to where 
the sites exist.
    There are States where we have a number of sites. I'll give 
Michigan as the example. We have had up to 84 sites that have 
been listed on the NPL. And we have thousands of State sites. 
Obviously we have to deal with those issues, and we do fund the 
program that needs to be funded.
    So I think that where the problem exists, and where the 
public has recognized that the States have an issue that needs 
to be addressed, then the States rise to the occasion and do 
fund those programs.
    Senator Lautenberg. Well, I'll ask you the same question 
that I asked Mr. Curtis in terms of the number of sites that 
listed. Do you think that a cap is appropriate? I don't know 
whether Senator Baucus asked that question before of you. Do 
you think we ought to cap the number of sites listed?
    Ms. Kerbawy. An NPL cap is not something that we're looking 
for. The way that it's crafted in this bill, I'm not sure that 
it creates problems for us. Right now, EPA is listing 
approximately 20 sites a year. The cap lays out about 30 sites 
a year. It still provides the ability for the gorilla in the 
closet that people are using today.
    After the first 5 years, I believe it's 100 sites could be 
added. It's not something we're looking for, it's not something 
that we're excited about. But it doesn't appear, the way it's 
crafted, that it's a problem.
    Senator Lautenberg. Last question. Do you think that the 
EPA ought to wait until the request comes from the Governor, or 
do you agree with Mr. Curtis that a Governor's concurrence 
would be the best approach?
    Ms. Kerbawy. It's very important to the States that there 
be a Governor's concurrence. I think the ability to influence 
what sites go onto the NPL is very critical to us. A Governor's 
concurrence would be very helpful.
    Senator Lautenberg. But you don't think it's necessary that 
the Governors initiate the request in order for a site to get 
listed?
    Ms. Kerbawy. The key point is that there be Governor's 
control over whether a site moves forward or not.
    Senator Chafee. Senator Voinovich.
    Senator Voinovich. Ms. Kerbawy, first of all, I'd like to 
congratulate Michigan on the great program that you have on 
brownfields.
    Ms. Kerbawy. Thank you.
    Senator Voinovich. Specifically, I think the fact you've 
got, what, a $400 million bond issue you've passed that can act 
as kind of a guarantee that if something is discovered later 
on, that the State will pick up the cost has been a real 
reassurance to some of your business people to go forward with 
cleaning up their brownfield sites. We're envious of you in 
Ohio for having that.
    I am a strong supporter of waiving Federal liability at 
sites that have met the cleanup requirements under State laws 
and programs. However, I'm concerned that this legislation does 
provide a hindrance to expediting State cleanups by requiring 
all sites to be listed on the CERCLIS for 2 years in order to 
receive the Federal liability waiver.
    In our State, about 25 percent of the known contaminated 
sites are not on CERCLIS. I think this potentially has the 
effect of slowing down cleanups at these sites. I would like to 
know, do you believe it's necessary for all sites to be 
included in CERCLIS in order to receive the exemption from 
Federal enforcement as specified in the bill?
    Ms. Kerbawy. That is one of the provisions in the bill that 
we have some concerns about, particularly with regard to 
brownfields. I think that listing on CERCLIS is an unnecessary 
step and one that can create problems for brownfield 
redevelopment. I think that one of the things that just 
recently happened was the archiving of 25,000 sites from 
CERCLIS to help in promotion of brownfield development.
    I think that was a recognition by the Federal Government 
that a listing on CERCLIS was a specter on those sites that was 
inhibiting brownfield redevelopment. I think that would also be 
the case if we had to list a site on CERCLIS for a couple of 
years before it moved forward.
    We have thousands and thousands and thousands of sites 
across the country that need to move forward under State 
programs and are not going to be addressed by the Federal 
Government. To have to have them be listed on CERCLIS in order 
to move them forward will create more problems.
    Senator Voinovich. Thank you.
    Senator Chafee. Senator Smith.
    Senator Smith. Thank you, Mr. Chairman.
    Mr. Johnson, you did identify some areas in the bill That 
you felt could be clearer, and as you know, my staff has been 
working with you on that and will continue to do that to try to 
clarify your concerns. But you state that the NAAG favors 
affording appropriate legal finality to cleanup decisions of 
qualified State voluntary cleanup programs and brownfields 
redevelopment programs. So I think in that respect, is it fair 
to say that you do agree with the mayors and the Governors and 
the State waste management officials on that issue?
    Mr. Johnson. Yes, we generally agree with them. I think 
that we would like to continue to work with you and the other 
Senators no the precise language in the bill and how the 
reopeners would work and whether a program has to be qualified 
and how that might take place. But we think basically the 
concept is important, the concept should be followed through, 
we support the concept and we'd be happy to work with everyone 
in making sure that the legal language works and does not pose 
a hindrance or have a bad effect on the environment or the pace 
of cleanups.
    Senator Smith. Ms. Subra, in your testimony, you stated 
that even though EPA and GAO tell us that the Superfund program 
is ramping down that we should not reduce funding. How do you 
justify that, if we're ramping down the program?
    Ms. Subra. In the State of Louisiana, we have approximately 
500 sites that haven't been addressed. In addition, we have 50 
sites that have been identified needing cleanup. We as a State 
do not have the money. Every time a new site is identified or 
an emergency occurs, we have to look to EPA to come in and do 
the work.
    The sites that are being put on NPL right now in Louisiana 
are all fund led sites. So we have been sort of slow in the 
process, we have less than 20 Superfund sites that are on the 
NPL list, a number of which are completing cleanup. But if 
there isn't financial resources at the Federal level, then the 
sites in Louisiana will not be addressed. We're looking to the 
Feds to help us clean those sites up.
    Senator Smith. Do you support State finality?
    Ms. Subra. In the State of Louisiana, no. Because what 
happens in the State of Louisiana is the legislature can 
suddenly decide to just gut the program, a new industry can 
come in and hire away all the experts at the State level. And 
if you have State finality, that comes under the jurisdiction 
of legislative mandates. The political will is not there to 
have State sites in Louisiana appropriately cleaned up.
    Senator Smith. Well, as I indicated to the previous panel 
on a question, our legislation specifically says that the State 
allows EPA, EPA is allowed to come into a State, one, in an 
emergency, two, at the request of the State, three, if the 
State's remedy fails and the State is unwilling or unable to 
respond, and where the contamination has migrated across the 
State line. Why do you object to that language?
    Ms. Subra. Also you have to have criteria in there where 
citizens can petition to have EPA come in. Because that's 
what's happening right now. It's over and over again in the 
State of Louisiana, the citizens are asking EPA to come in and 
address the problems. The State isn't asking EPA to come in in 
all cases.
    Senator Smith. So it's more than just the State's ability 
or inability to perform? You want more citizen participation? 
There is citizen participation now, you know.
    Ms. Subra. But in your criteria that you listed, you didn't 
have one that says, the citizens can petition EPA to come in 
and address a problem.
    Senator Smith. Even if the State doesn't want them in, or 
need them?
    Ms. Subra. If the citizens feel that the State is not doing 
an adequate job, they need to be able to petition EPA, and then 
EPA comes in and addresses the issue on whether or not the 
problem is bad enough for them to step in.
    Senator Smith. Ms. Kerbawy, let me ask you one question. 
You stated in your testimony that you found that the States 
have completed about seven times as many sites per year in 
recent years as they have in the first 12 years in the program, 
so that the State accomplishments are increasing. Yet we hear a 
lot about the need to recognize these changes in the Superfund 
program.
    What I continue to hear and witness after witness at some 
of the sites that I've visited around the country, it seems to 
indicate that although the law provides a role for EPA at NPL 
sites in theory, in practice it's not happening as much as it 
should. Is that fair? Does that represent your view?
    Ms. Kerbawy. I'm not sure I understood the question. You 
were wondering at EPA's role at NPL or non-NPL sites?
    Senator Smith. Non-NPL. The law provides a role for EPA at 
non-NPL sites in theory, that in practice is probably not 
exercised. Is that a fair statement?
    Ms. Kerbawy. Yes, I think that is a fair statement. EPA 
generally does not get involved in non-NPL sites, except for 
removal actions. We very rarely see them get involved in those 
sites.
    But the liability extends across all sites where there is a 
release. What we see really happening and having the most 
impact is that people are afraid that the Federal Government 
will come in and exercise the liability issue.
    The other thing is that there is cause of action for third 
party contribution suits, things like that. So people are 
afraid that they will get brought in for compensation, cost 
recovery by others that have performed cleanup work.
    So the specter of the liability issue, even though EPA 
generally does not get involved in the non-NPL sites, is still 
there. It's still a problem for the brownfield sites.
    Senator Chafee. I want to thank everybody in the panel. We 
appreciate your being here.
    Now, if the next panel will come right up. Let's take all 
six at one time.
    Mr. Bernie Reilly, from Du Pont; Karen Florini, from EDF; 
Mark Gregor, from the city of Rochester; Mr. Nobis; and Mr. Red 
Cavaney, the President of American Petroleum Institute; and 
Mike Ford. If you could all take your seats.
    Mr. Reilly, why don't you proceed.

 STATEMENT OF BERNARD J. REILLY, CORPORATE COUNSEL, DU PONT DE 
                    NEMOURS E.I. AND COMPANY

    Mr. Reilly. Good afternoon, Chairman Chafee, Chairman Smith 
and members of the committee. My name is Bernard Reilly. I'm 
corporate counsel for the Du Pont Company, and I'm here 
representing the Chemical Manufacturers Association.
    CMA has worked on Superfund reform since the early 1990's 
with the Members of Congress, the Administration, environmental 
groups, States, cities and other business organizations. In 
addition, we have worked with EPA to improve the Superfund 
program through administrative reforms.
    I would like to commend Chairmen Chafee and Smith for their 
leadership over the years in trying to reform the Superfund law 
and for their introduction of S. 1090, the Superfund Program 
Cleanup Act. CMA recognizes the Senators' accomplishments in 
producing this bill. It is a good bill.
    As long participants in the efforts to reform Superfund, 
CMA understands that this is not an easy task, and looks 
forward to working with both the Republican and Democratic 
members of the committee and the Senate on this bill.
    CMA has completed a preliminary review of the recently 
introduced bill. We'd like to spend the next few minutes 
highlighting what is especially noteworthy, touching on a 
number of strong areas and following with some areas that we 
believe could be improved.
    Clearly the most important issue facing Congress at this 
time is the future direction of the program. As we've 
previously noted, after 17 years of existence, there's more of 
Superfund behind us than ahead of us. According to EPA, nearly 
90 percent of all non-Federal sites in the NPL are undergoing 
cleanup.
    Congress needs to determine what remains to be done under 
Superfund, how long it will take and how much it will cost. We 
strongly commend the co-sponsors of S. 1090 for recognizing 
these critical issues and taking appropriate steps to address 
them.
    CMA has prepared estimates of the funding required to 
complete the job at hand. These indicate that Superfund funding 
could be dramatically reduced and there still would be 
sufficient funds to pay for both the remaining sites that GAO 
and EPA have concluded will be added to the NPL in the future.
    Program spending levels should be adjusted according to fit 
the future needs of the program in order to ensure that more 
funds than necessary are not appropriated. S. 1090 does exactly 
that. Congress should take the next step and direct an 
independent study of funding needs.
    In addition to recognizing that Superfund is moving toward 
completing the job of cleaning up existing sites and that 
funding levels need to be adjusted accordingly, S. 1090 
contains other important provisions. These include finality for 
State cleanups, an integral Governors' role in the process of 
listing sites on the NPL, liability relief to ensure that 
brownfields are redeveloped, and a recognition of the State's 
primary role in cleanup. We strongly commend the chairman for 
these provisions as well.
    Another aspect of this bill deserves credit, and at the 
same time it raises some concerns about its implementation. 
This particular aspect has to do with exemptions that are 
provided for certain parties and the allocation system that is 
set up to pay for those parties' shares.
    The bill deserves credit for recognizing that it would be 
wholly unfair to pass exempt party shares to the remaining 
parties at the site. The allocation system that is set up to 
determine these shares, however, appeared to be flawed. Under 
this system, industrial parties at these sites not only will 
continue to pay more than their fair share of liability, they 
likely will have to pay for shares attributed to exempt 
parties.
    As we all know only too well, it is not easy to develop 
fair, defensible and acceptable liability allocations. CMA has 
advocated a streamlined system for several years calling for 
the inclusion of certain basic elements, but not overburdening 
the system with details.
    The single most important element of any streamlined 
process is that it be administered by third party neutrals who 
do not have a vested stake in the outcome. S. 1090 does not 
include this element. Instead, the bill designates EPA as the 
allocator. This is not appropriate, given EPA's demonstrated 
vested interest in preserving the trust fund and the culture of 
assigning liability only to the financial viable parties.
    Fundamental reform to ensure a successful, cost-effective 
future of the Superfund program also requires changes to areas 
including natural resource damages, remedy selection, and cost 
recovery programs.
    In conclusion, Chairman Chafee and Chairman Smith and 
members of the committee, we would like to thank you for 
undertaking the hard work necessary to produce the Superfund 
Program Completion Act. As I have said, the future direction of 
the program is the most critical issue facing us in reforming 
Superfund. We see that future as one in which sites currently 
listed on the NPL are cleaned up and the remaining sites are 
addressed under a reduced program with reduced spending levels. 
We strongly commend you for taking an innovative look at these 
issues and addressing them in S. 1090.
    We appreciate the opportunity to provide this input, and I 
would be delighted to answer any questions.
    Senator Chafee. Thank you very much, Mr. Reilly.
    Ms. Florini?

  STATEMENT OF KAREN FLORINI, SENIOR ATTORNEY, ENVIRONMENTAL 
                          DEFENSE FUND

    Ms. Florini. Thank you, Mr. Chairman.
    My name is Karen Florini, I'm a senior attorney with the 
Environmental Defense Fund.
    I think this is the fourth or fifth time I've appeared 
before this committee to discuss Superfund reauthorization in 
the last few years, and personally, I would be just as happy if 
this were the last such occasion that came along. I was very 
pleased to hear that you will be in discussions shortly with 
the Administration in the hopes of developing a bipartisan and 
widely supported bill that addresses the issues that are in S. 
1090, and I wish you all Godspeed.
    There is no question but that the Superfund program has 
changed dramatically in the half dozen years since we all 
started these discussions about Superfund reauthorization. 
While Superfund still has its critics, myself among them, the 
real question at this point is whether S. 1090 as it stands now 
would make things better. We recognize and applaud the fact 
that this bill is considerable narrower than Superfund 
reauthorization bills that have been introduced in prior 
Congresses. Unfortunately, however, we conclude that S. 1090, 
as it stands, would not generally make things better and 
therefore we oppose the bill.
    I will describe a couple of my major objections in a moment 
but first, I do want to note that we do continue to believe 
that reimposition of the Superfund polluter pays taxes 
continues to be important. Fundamentally, we think it's time 
for the industry's $4 million a day tax holiday to end.
    With respect to the specific provisions of S. 1090, one of 
the major concerns involves the bill's reductions in authorized 
funding levels over the next 5 years. It is far from clear that 
EPA in fact is going to need less money. It is true that there 
have been 600 construction completions, but there are another 
700 already listed sites still on the Superfund list.
    It is my understanding from informal discussions with EPA 
that the agency expects to continue construction completions at 
about the same pace, as has been the case in very recent years, 
about 85 per year, which of course they will not be able to do 
if funding is curtailed. For years, critics of the Superfund 
program have bemoaned the slow pace of cleanups. Now that the 
pace has increased, it is not appropriate to choke it off 
through inadequate authorizations.
    While it's true that the shape of the Superfund pipeline is 
different now than it has recently been, the bill simply 
ignores the fact that correspondingly, there are a lot more 
sites that are now in the operation and maintenance phase. To 
date, EPA has done a miserable job of keeping up with their 
statutory obligation to conduct 5 year reviews at sites where 
some contamination has been left in place. I have an article 
attached to my written testimony that details the 5-year review 
program and how little progress has been made in implementing 
it, and some of the serious problems that have been found in 
sites where, the few sites where EPA has gone back and taken a 
look.
    Only by that kind of active oversight can we hope to know 
where remedies are not working and actually to take action to 
protect health and the environment at those sites. In other 
words, even if EPA were to need fewer resources for the 
construction completions in the years ahead, an assumption that 
I do not believe is warranted at this time, the agency is going 
to need more resources to conduct the 5-year reviews and the 
followup actions associated with the results of those reviews.
    To add insult to injury, S. 1090 provides that funds for 
liability relief get preferential treatment and that an ability 
to finance liability relief at a site limits EPA's ability to 
order final cleanup steps at the site. Doubtless, it will not 
come as a particular surprise for me to tell you that we 
strongly oppose those provisions.
    Turning to the fair share allocation process, generally 
although that sounds innocuous, we think there are some serious 
problems in the bill as it stands. My written statement 
provides additional details on that.
    Finally, I want to mention that we oppose numerous 
provisions in S. 1090 that would cut holes in the Federal 
safety net for cleanups. I want to talk specifically about the 
finality issue that has been much discussed this morning. There 
is already in law provisions for lender liability relief. This 
bill contains, and we support, provisions for prospective 
purchaser liability relief.
    What we are really talking about with finality is giving a 
windfall liability relief to current sellers. We strongly 
oppose that. We do not think it is necessary or appropriate to 
tell a seller of a contaminated property who is and has for the 
last 20 years been liable under Superfund that if the State 
comes in, oversees a cleanup that by definition is ineffectual, 
that when EPA comes to want to take additional action and 
recover its costs, that the agency has restrictions on its 
ability to do so. That just does not compute in our calculus.
    Finally, we have some concerns, we strongly oppose the cap 
on the number of NPL sites, for reasons that Senator Baucus 
laid out. It's not sound science. The number of sites that 
should be listed is the number of sites that need to be listed.
    We also oppose the Governors' concurrence. While we agree 
that it's appropriate for there to be an orderly mechanism and 
for States to have first dibs onsite where they can and will 
proceed expeditiously to handle the site, that is far different 
than telling the Governors that they have a veto over the 
listing of the sites.
    We have some concerns about over-breadth of some of the 
liability carve-outs. But I do want to mention, to close on a 
positive note, by saying that we agree that the pull-back 
mechanism that exists for some of the liability relief 
provisions is indeed appropriately crafted. We think it is very 
important to have a pull-back provision that says that if some 
of these rough rules that are embodied in the liability 
provisions turn out not to be appropriate to apply in 
particular cases, it will be possible to utilize the pull-back 
provisions so that you don't end up with an anomalous result as 
would otherwise occur.
    Thank you.
    Senator Chafee. Thank you, Ms. Florini. Now, Mr. Mark 
Gregor from the city of Rochester, on behalf of Local 
Government Environmental Professionals.
    Mr. Gregor?

 STATEMENT OF MARK GREGOR, MANAGER, DIVISION OF ENVIRONMENTAL 
              QUALITY, CITY OF ROCHESTER, NEW YORK

    Mr. Gregor. Thank you and good afternoon, Mr. Chairman and 
other members of the committee. My name is Mark Gregor, and I'm 
the Manager of the city of Rochester's Division of 
Environmental Quality. One of my primary responsibilities is to 
actually conduct the investigation and cleanup work at 
brownfields sites and some State Superfund sites.
    I'm pleased to have the opportunity to testify here today 
in behalf of the National Association of Local Government 
Environmental Professionals, or NALGEP. We represent city and 
county environmental managers and more than 100 local 
governmental entities across the country. Our members include 
many of the Nation's leading brownfield communities, including 
Dallas, Chicago, Portland, Baltimore and Glen Cove that you 
heard from earlier today.
    NALGEP has been working actively with local governments on 
brownfields since 1995, when we began a project which led to 
the publication of our first report, Building A Brownfields 
Partnership From The Ground Up, with local government view on 
the value and promise of national brownfields initiatives. We 
continue to coordinate work groups to address critical 
brownfield issues, such as revolving loan funds, voluntary 
cleanup programs, smart growth and the implementation of EPA's 
showcase program.
    Brownfields are undoubtedly one of the most significant 
issues for urban areas, including Rochester, New York. The 
cleanup and redevelopment of brownfields is one of the most 
exciting and challenging opportunities that we have facing the 
Nation. And I would compliment the members of the committee on 
their leadership in promoting legislative solutions to this 
issue. Virtually every community faces brownfield challenges.
    Brownfield revitalization provides important environmental 
and economic benefits, including the cleanup, of course, of 
sites, the renewal of local economies by stimulating 
redevelopment and job growth and job retention and enhancing 
the vitality of communities, as well as limiting sprawl and its 
associated environmental problems of traffic and air quality 
problems and over-development of rapidly disappearing green 
spaces.
    During the last 5 years, the city of Rochester has 
completed the remediation of more than 50 acres of brownfields, 
including the site of Bausch and Lomb Corporation's new 
corporate headquarters, a site of a new Federal Aviation 
Administration funded aircraft rescue and firefighting 
facility, and a site of a state-of-the-art 911 office of 
emergency communications.
    The city was selected as one of the first rounds of EPA's 
pilot brownfield cities, and Rochester was also awarded one of 
the brownfield cleanup revolving loan grants from EPA. Using 
the first grant from EPA, the city investigated 15 and a half 
acres of junk yards and scrap yards, fuel depots and a rail 
yard. That 15 and a half acres now is part of the city's Erie 
Canal Industrial Park.
    Rochester is also in the process of establishing a site 
investigation fund to provide private sector funds for 
investigation of sites.
    The Federal Government, particularly U.S. EPA, has played 
an important role in helping Rochester develop the capacity and 
infrastructure of our brownfield program. Critical funding has 
enabled us to institutionalize some of these programs, 
technical assistance and other resources that have helped us 
learn from other communities has been extremely important. The 
connections with other Federal agencies through EPA's efforts 
have been very helpful.
    Most importantly, it's been able to provide critical 
leadership to the various stakeholders in our community to help 
understand the problem a little bit better.
    NALGEP is interested in legislative action in three areas. 
Additional funding in the form of grant and loan programs is 
especially important for many cities, including Rochester. 
Rochester has a declining tax base now and falling assessed 
property values. So budgetary and financial issues are crucial 
to us.
    New Federal legislation to further clarify and provide some 
limits on the liability of non-responsible new owners of 
brownfield sites that voluntarily complete cleanups is very 
important. The need to facilitate and encourage the 
participation of other Federal agencies in brownfield 
revitalization continues to be important and will become more 
important for us.
    With respect to the first item, with regard to funding, 
continued Federal investment is critical to the cleanup and 
development of brownfields. Funding is needed for site 
assessment, remediation and redevelopment. Costs for site 
assessment and remediation can often be significant initial 
barriers to getting projects and site work underway.
    The EPA pilot grant, grant programs focused onsite 
assessments, have enabled many communities to initiate this 
work and have begun to give developers and lenders some 
additional confidence that local governments, State governments 
and Federal Government are taking the brownfield issue 
seriously.
    Congress should build on this success.
    Senator Chafee. Mr. Gregor, do you want to summarize your 
points here?
    Mr. Gregor. Sure. Basically, there are three areas that we 
look toward our grants, grants for cleanup, grants for 
investigation, capitalization of revolving loan funds that are 
not exhibited by or encumbered by national contingency plan 
administrative requirements.
    In addition, we are looking for additional clarification of 
liability on the part of new owners in particular. And Congress 
should also further clarify and limit liability for non-
responsible parties, as I mentioned earlier.
    Finally, with respect to the finality question, NALGEP has 
found that one of the most significant things that the Federal 
Government can do is to facilitate brownfields re-use by EPA 
delegating the authority to limit liability and issue no 
further action decisions for non-NPL caliber sites to the 
States. NALGEP has proposed that there be some initial entry 
criteria for those States and they are indicated in the 
testimony, the written testimony.
    Finally, with respect to the finality question, NALGEP is 
of the opinion that EPA should provide that it will not plan or 
anticipate further action at any sites unless at a particular 
site there is an imminent or substantial threat to public 
health or the environment, and either the State response is not 
adequate or the State requests EPA assistance.
    Finally, with respect to other agencies and other Federal 
agencies' involvement, the Congressional action to clarify the 
use of community development block grant funds for cleanup 
purposes has been very helpful. By their actions, many of these 
Federal agencies have significant impact on our ability to 
reuse brownfields, as well as to prevent the concerns of sprawl 
in green field areas.
    Thank you.
    Senator Chafee. Thank you very much, Mr. Gregor.
    Mr. Nobis?

STATEMENT OF MIKE NOBIS, GENERAL MANAGER, JK CREATIVE PRINTERS, 
                        QUINCY, ILLINOIS

    Mr. Nobis. Thank you, sir.
    Mr. Chairman and distinguished members of this committee, 
my name is Mike Nobis, and I am from Quincy, Illinois. I'd like 
to thank you for allowing me this opportunity to speak to you 
today, to share my hometown's experiences with a landfill that 
became a Superfund site. It's my hope and my goal this morning 
to bring a different perspective on what the effects are of a 
Superfund site and the Superfund law.
    I'm the general manager and a part owner of JK Creative 
Printers. My company, which my family has owned for over 30 
years, employs 43 employees. We are very proud members of the 
National Federation of Independent Businesses, the NFIB. I'm 
very honored here today to present this testimony on behalf of 
the 600,000 business owners who are members of the NFIB.
    If you don't know where Quincy, Illinois is, Quincy is just 
a small community of 42,000 people. We're located on the banks 
of the Mississippi River, just 150 miles north of St. Louis, 
Missouri. If you don't know where that is, if you recognize the 
stomach of Illinois, we're the belly button.
    [Laughter.]
    Mr. Nobis. Our town is a great place to live in and to 
raise a family. We do believe that we've enjoyed many years of 
good economic growth, good schools, strong community 
involvement and very good city leadership.
    Of all the expectations we do have of our community, having 
our landfill declared a Superfund site was definitely not one 
of them. In 1993, you might remember when the Mississippi River 
reached its highest stages of flood stages in history, this 
prompted our community to rally together and beat back the 
floods, and the effects of it. Now my community again is being 
forced to band together to fight the unfairness of a Superfund 
law that is punishing us for legally disposing of our trash.
    Companies that once worked together to fight back this 
flood are now suing each other because of the Superfund 
landfill. Companies who once worked together to sell and buy to 
each other are now suing one another.
    For my company, it started on February 10th, 1999, this 
year, when we received in the mail from the EPA a letter that 
stated that six local corporations and the EPA and the city 
were looking to recover some of the costs For cleaning up our 
local landfill. Even though what we had hauled there was only 
trash and totally legal, the EPA said that because we sent our 
trash there that we were potentially liable and responsible For 
paying our proportional share of the cleanup.
    When you get a letter like this, as when I got this letter, 
I felt very sick, needless to say. For me and the 148 other 
companies that received this letter, it was totally unexpected 
and without warning. At first, we had no idea what this letter 
was really even telling us. We soon found out that it was 
asking us as small companies to contribute $3.1 million.
    I had to laugh at that language, because they used the word 
contribute. They weren't asking us to contribute anything. They 
were threatening us to pay.
    My company's designed amount was $42,000. I really consider 
myself lucky. Because there were other companies and other 
individuals being asked to pay $70,000, $85,000, and there were 
some small companies being asked to pay over $100,000. As I 
read through the list, you could see things like Catholic grade 
schools, our local university, bowling alleys, small mom and 
pop hauling companies, furniture stores, and yes, even our own 
McDonald's was listed to pay.
    Most of the companies named only generated waste like plain 
office trash or food scraps. In the mid-1970's, when our 
company's trash began to be put in that landfill, I was in 
college. We have other owners, in another company, a person who 
owned the company was only seven when the landfill was in use. 
Yet we are being held responsible.
    The document made it sound as though we were major 
hazardous waste dumpers. Yet nowhere in the document did it 
list what waste we were accused of dumping.
    Senator Chafee. You have a long way to go here, Mr. Nobis. 
If you will summarize, see the light here.
    Mr. Nobis. I'll get through this. The important part of 
this is, when the EPA came into our community and tried to 
explain to us the application of the law, we had found out that 
the law was really unfair to us. Our community found it as un-
American as possible. We found ourselves in a very difficult 
position. We were being asked to contribute funds of money that 
we weren't responsible For in any of the waste that went to the 
landfill.
    It is important For us to try to communicate today to this 
committee that small businesses need to be removed from the 
liability of contribution to these sites. Because the effects 
of these funds that we're being asked to pay For the landfills 
are devastating our Companies. We don't have the funds or 
resources to help pay For the cleanup of these sites.
    Thank you.
    Senator Chafee. I think that's very good testimony, Mr. 
Nobis.
    All right, Mr. Cavaney, from API?

STATEMENT OF RED CAVANEY, PRESIDENT AND CEO, AMERICAN PETROLEUM 
                           INSTITUTE

    Mr. Cavaney. Mr. Chairman, members of the committee, my 
name is Red Cavaney. I am President and CEO of the American 
Petroleum Institute, which represents over 400 U.S. companies 
from all segments of the oil and natural gas industry, 
including exploration and production, transportation, refining 
and marketing.
    It's a pleasure for me to be here today to speak in support 
of yours and Senator Smith's Superfund reform legislation, the 
Superfund Program Completion Act of 1999. I request that the 
written statement I have submitted be inserted into the hearing 
record.
    Senator Chafee. Without objection, so ordered.
    Mr. Cavaney. API supports your efforts and applauds you for 
moving the Superfund debate a giant step forward. Your 
legislation addresses the difficult and complex issue of 
liability reform, one of the central problems that has plagued 
the program. It moves the Federal program toward completion by 
capping the number of sites on the National Priority List and 
by increasing the responsibility of States For administering 
cleanup activity.
    It addresses the emerging issue of brownfields 
rehabilitation and it appropriately recognizes that the 
Superfund program should be funded with general revenues. To be 
sure, the Superfund program needs additional repairs. But as 
you and Senator Smith so correctly note, Congress and the 
Administration have been unable to find acceptable compromises 
on many issues. The lack of agreement on those issues should 
not prevent Congress from making important changes included in 
the Chafee-Smith bill.
    The petroleum industry has a unique perspective with regard 
to Superfund. Oil and gas Companies have paid more than 57 
percent of all the taxes collected for the program. Let me 
emphasize, the oil and gas industry's tax payments far exceed 
its responsibility For Superfund cleanups, which the U.S. 
Environmental Protection Agency has estimated at less than 10 
percent.
    The Superfund Trust Fund was created to pay for the cleanup 
of abandoned or orphaned hazardous waste sites. However, only 
11 percent of its funds have been expended for that purpose. 
According to the General Accounting Office, about half the 
program's funds have paid the cleanup costs for non-orphan 
sites, and only a small percentage of these dollars have been 
recovered. If EPA improves its recovery of cleanup costs from 
known responsible parties, the program will need less funding 
from general revenues in the future.
    Those who contributed to a hazardous waste site should 
continue to be held responsible to pay for their share of the 
cleanup. Let me assure you, Mr. Chairman, that authorizing 
general revenues for Superfund is consistent with the basic 
principle. Even though the dedicated taxes expired in 1995, 
responsible parties have continued to pay their share of 
hazardous waste site cleanup costs. For example, from 1996 
forward, we estimate that oil and gas companies will pay a 
total of $1.2 billion in direct Superfund cleanup costs.
    Despite the many shortcomings of the Superfund program, 89 
percent of the sites on the National Priority List are in some 
stage of cleanup. Superfund in its current form is moving 
toward completing its mission. Revenues from the general fund, 
fines, penalties, interest on the fund balance, and de-
obligated funds, assure funding for the program well into 
fiscal year 2001.
    According to reports by GAO and the Congressional Budget 
Office, there are no legal impediments to the use of general 
revenues to fund the Superfund program. It makes sense for 
Congress to use general revenues to pay for orphan shares and 
administrative costs in the remaining years of the program as 
the bill proposes.
    This is an appropriate use of general revenues, since every 
segment of society has some responsibility for handling the 
problem of solid waste sites. Your legislation also moves a 
number of non-EPA Superfund activities outside EPA's Superfund 
budget and eliminates EPA's practice of transferring funds to 
other Federal agencies for ``Superfund support.'' API strongly 
supports this move.
    If EPA focuses on completing the program's original mission 
of cleaning up those remaining sites on the NPL, and if it 
fully implements the GAO management recommendations, Superfund 
expenditures can be reduced. That will further limit the amount 
of general revenues required.
    With Superfund's mission nearly complete, now is the time 
to plan for the future. We agree with you and Senator Smith 
that this is the time to begin ramping down Federal programs. 
Your bill moves in that direction by proposing to limit the 
number of sites that will be added to the NPL during the next 
few years, and by transferring administration of cleanup 
activities to the States for final disposition.
    Once again, we appreciate the opportunity to testify in 
support of the Superfund reform proposal, and we commend you 
for your steadfast efforts dedicated to improving the Superfund 
program.
    Thank you, Mr. Chairman.
    Senator Chafee. Thank you very much, Mr. Cavaney.
    Mr. Mike Ford, on behalf of the National Association of 
Realtors?

    STATEMENT OF MIKE FORD, NATIONAL ASSOCIATION OF REALTORS

    Mr. Ford. Mr. Chairman, thank you for the opportunity to 
present the views of the National Association of Realtors on S. 
1090, the Superfund Program Completion Act of 1999. I wish to 
thank Chairman Chafee and Chairman Smith for their continued 
and determined leadership in building bipartisan consensus on 
this very important issue. Senator Lautenberg is from our area, 
I know he's not on the bill, but he's been very involved in the 
environment in New Jersey over the years.
    My name is Mike Ford. I own a full service residential and 
commercial real estate company in Clark, New Jersey. I've been 
a real estate broker for 25 years.
    It is often said, and I agree, that realtors don't sell 
homes, we sell communities. The more than 730,000 members of 
the National Association of Realtors, real estate professionals 
involved in all aspects of the real estate industry, are 
concerned and active members of our communities. We want clean 
air, clean water, clean soil. We want to see properties 
affected by historic pollution cleaned up and returned to the 
marketplace. We care about health, quality of life, as well as 
a vibrant economy. We are willing to do our part to maintain 
the important balance.
    However, we also expect some fairness, certainty and 
predictability from government regulators that our customers 
expect from us. In this respect, Superfund has clearly failed.
    Superfund began with laudable goals of cleaning up 
hazardous waste sites to protect human health and the 
environment. Progress has been achieved, and for that, the EPA 
deserves credit. Unfortunately, progress has come at a high 
price. While serving as a mechanism for hazardous waste 
cleanups, Superfund has also served as an engine for massive 
litigation.
    Deep pocket parties targeted by EPA have turned around and 
sued smaller parties. Many of these smaller parties are small 
business owners who did nothing more than dispose of common 
garbage, recyclers who tried to be environmentally conscious 
and innocent property owners who have not caused or contributed 
to hazardous waste contamination, have been drawn into years of 
costly litigation defending against the threat of huge cleanup 
liability.
    As a first step, these parties should be provided with the 
maximum degree of liability relief so that resources can be 
targeted toward cleanup rather than litigation. When it comes 
to Superfund cleanup, we must ensure the real polluters pay, so 
that the hazardous waste sites are returned to productive use 
as soon as possible. From the perspective of taxpaying 
citizens, it is the right thing to do to ensure that Superfund 
is administered in a fair and effective manner. From the 
perspective of businessmen, it also provides the certainty 
needed in order to move forward in developing sites that are 
known or suspected to be contaminated.
    As a second step, the Federal Government should recognize 
and support hazardous waste cleanup efforts underway at the 
State level. In an effort to revitalize urban centers, most of 
the States, including my home State of New Jersey, are 
creatively attacking the hazardous waste problems by providing 
incentives to voluntary cleanup programs.
    One common incentive provided by the program is liability 
relief. Typically, the State will provide some sort of relief 
once it has approved the cleanup. In New Jersey, the relief 
comes in the form of a no further action letter from the DEP. 
Unfortunately, there is no guarantee that the Federal EPA will 
not assert authority at a future date and require additional 
cleanup. Without the certainty of knowing that they are 
protected from Federal as well as State liability, property 
owners and developers are very reluctant to undertake 
development of a site that may be contaminated.
    In New Jersey, we have our fair share of hazardous waste 
sites. However, you see what we can accomplish when local, 
State and Federal Government work together. In my home town of 
Clark, General Motors cleaned up a contaminated site and funded 
construction of a golf course. The local government now runs 
the golf course and makes a healthy profit on it.
    If these reforms are achieved, hazardous waste sites 
throughout the country will be returned to productive use, 
revitalizing communities by increasing their tax base, creating 
jobs and rejuvenating neighborhoods. Otherwise, it will remain 
barren, contributing to nothing but economic ruin.
    S. 1090 presents a win-win opportunity for everyone by 
achieving cleanup of hazardous waste sites, encouraging 
property use and enhancing community growth. Now is the time 
for Congress to assert bipartisan leadership and reinforce our 
nationwide effort to turn brownfields into green fields. The 
National Association of Realtors supports S. 1090. We encourage 
the 106th Congress to act now on Superfund reform.
    Thank you again for the opportunity to present the views of 
the National Association of Realtors.
    Senator Chafee. Well, thank you very much, Mr. Ford.
    Ms. Florini, you've heard this testimony that seems to be a 
constant drum beat here about the brownfields problem. It's a 
very serious one, and it seems to me the witnesses have wisely 
pointed out that this is an environmental issue, it isn't just 
a safety or health issue. Because if we can use these lands 
within the city, then they don't go outside in these lovely 
fields and develop industrial parks and gobble up the land, so-
called urban sprawl.
    But you've also heard that what they seek, I think Mr. Ford 
touched on it, others have touched on it, is some finality in 
this thing, somehow have it done with, that a site is clean and 
then the potential purchasers can proceed with some sense of 
security that they're not going to be second guessed by EPA 
coming in later on.
    Could you give me your thoughts on all that?
    Ms. Florini. First of all, yes, obviously we strongly 
support brownfields redevelopment. As I tried to allude to in 
my oral statement, we do in fact strongly support the 
prospective purchaser liability relief. I think I've been on 
record supporting that for several years now.
    I think the rhetoric of the finality issue is confusing two 
different issues. The one relates to relief for purchasers. But 
as I just said, we support relief for purchasers. What I do not 
support is the further step of providing what I believe is 
windfall liability relief for sellers, sellers who have been 
liable for 20 years under Superfund and who under the 
provisions of this bill as I read it would be allowed to have 
States waive their future liability.
    I don't believe that is in fact necessary. I don't think 
that most of the people who have focused on the need for 
finality as an incentive for additional brownfields development 
have differentiated between the two different parts of it. I 
think that is in fact something that does and should be taken 
into consideration.
    Senator Chafee. Do you have any thoughts on that, Mr. Ford?
    Mr. Ford. Finality is an important issue. When you're 
cleaning up in New Jersey, under the DEP auspices, and if 
you're constantly worried that the EPA is going to come in and 
reevaluate the site, give you more cleanups, not agree with 
what the DEP has agreed to, no one wants to clean up under 
those auspices. It's not a practical consideration. You're 
digging into a deep well, and then the EPA is going to come in 
and make it a deeper well to clean up.
    Senator Chafee. Senator Baucus.
    Senator Baucus. Thank you, Mr. Chairman.
    Ms. Florini, I wonder if you could comment a bit on whether 
or not it makes sense to extend the Superfund tax, either or 
both of its two components, as we look toward eventual 
completion of cleanup.
    Ms. Florini. Yes, I think it does make sense to reimpose 
the Superfund taxes at this time to provide an assured and 
specific funding source for the program.
    Senator Baucus. Why do you say that, even though as you 
know, under our very arcane and nobody understands them budget 
rules here that a dollar is a dollar, whether it's Superfund 
tax or whether it's general revenue or what-not, why is that 
necessary?
    Ms. Florini. Well, Senator Baucus, if you don't understand 
the budget process, I``m certainly not going to lay claim to do 
so.
    [Laughter.]
    Senator Baucus. But you know what I'm talking about.
    Ms. Florini. Yes. The original concept behind creation of a 
trust fund supported by dedicated taxes was that it would both 
create an incentive for appropriators to be more likely to 
actually go ahead and appropriate the funds, and also establish 
the polluter pays principle in two ways, not just in the 
liability provisions of the statute, but also by tying the 
taxes to a group that is at least more connected to the 
creation of the Superfund sites than the general public is. So 
to the extent that there are expenses associated with the 
Superfund program that are not feasibly cost recoverable, then 
the taxes are there to provide the funding to pick up that 
burden.
    Senator Baucus. What do you think the chances are that the 
money will be there to pay for the cleanup if there is no 
extension of the tax?
    Ms. Florini. I think I need to go back to my original 
response to your question, Senator. I honestly don't know the 
response to that question.
    Senator Baucus. Well, as many know, there is a problem 
here. One of the problems is relying exclusively on general 
revenue. The problem there is that we have at this point anyway 
budget caps. As a practical matter, the total number of dollars 
that will be available under the Appropriations Subcommittee 
will be about $12 billion in current spending, $12 billion less 
than current spending. So that Appropriation Subcommittee is 
going to have to figure out where it is going to cut the money.
    In addition, the bill itself authorizes levels at about 25 
to 30 percent lower than current. If the Superfund tax is not 
extended, even though technically those dollars are not 
necessary for Superfund, although psychologically, the more 
that it's there, the more than it helps, there's going to be a 
problem, it seems to me, on whether or not this program is 
going to become even close to being funded at the levels most 
people in the country expect it to be. Do you agree with that 
statement or not?
    Ms. Florini. Yes, that does in fact reflect, I think, where 
things stand, which is why we do indeed believe that the taxes 
ought to be reimposed. Certainly one of the things we find most 
objectionable in the bill is the ramp-down on authorizations.
    Senator Baucus. And the caps on new listings?
    Ms. Florini. Yes, definitely oppose that as well.
    Senator Baucus. How do we get to completion? Obviously 
there are lots of complaints about the current program. You 
heard a lot of the discussion about finality and how there is a 
chilling effect on local communities to develop sites for fear 
that there will be some liability here and so on and so forth. 
Obviously, we're all basically working toward the same solution 
here, to complete cleanup as reasonably as possible, complete 
it, but complete it reasonably but do it well. How do we get 
just generally there? Do you have an overall thought about 
that?
    Ms. Florini. We stay the course. I think at this point it's 
very clear that the pace of cleanup has accelerated 
dramatically over the last few years. In fact, the 
environmental community is having some concerns that in some 
instances, at least, quick may be being now traded off by EPA 
for good. That's just a general footnote.
    But clearly, we do not reduce the resources being made 
available to the program in a way that would curtail the pace 
of progress. And we do not make a number of, we do not fiddle 
with the law, we do not change the fundamental liability and 
the fundamental cleanup.
    Senator Baucus. Mr. Reilly, I will give you a chance to 
answer that one.
    Mr. Reilly. Would you repeat the question, Senator?
    Senator Baucus. Any one of the questions.
    [Laughter.]
    Senator Baucus. Basically, from your perspective, obviously 
it's the tax.
    Mr. Reilly. The issue of the tax is near and dear to our 
heart. It hits industry widely, disparately. But for those who 
feel as though the polluters are not paying right now, I guess 
I'll take the occasion to remind you that every single site 
where Du Pont is involved and any other company is involved, 
and that's over 70 percent of the NPL sites, we're paying our 
fair share probably by a factor of 3. We pay for whatever the 
heck our liability is at the site, based on the neutral that we 
bring in, or the courts. There's generally a large number of 
orphan parties, the owner or operator is defunct. We pay for 
that share.
    And then we also pay for the oversight costs that EPA 
engages, basically spending our money from the fund to oversee 
us. We have to pay that money back. So we're paying by a factor 
of three as it is. If you want to reimpose the Superfund taxes, 
then we overpay by a factor of four. I think that's a fair way 
to characterize it.
    Senator Baucus. CMA did support the tax, though, 
previously, like in 1984 for example? Or in 1994, it supported 
the tax?
    Mr. Reilly. In the context of a comprehensive reform of 
Superfund and in the context of taking a look, especially now 
that we're toward the end of the pipeline, Senator, we want to 
make sure the program is funded adequately. If in the end that 
requires some contribution by the companies, you can count on 
us.
    Senator Baucus. It's also true that if the only 
contribution to pollution is petroleum, that petroleum is 
exempt, oil and gas is exempt.
    Mr. Reilly. I'd rather you ask that to the petroleum 
industry, Senator, we're a chemical company and we have no 
exemptions.
    Senator Baucus. So I understand, but is there another way 
to recast this tax? My staff will hate me asking this question. 
Can we revise it in some way or deal with it in some way, so 
that the funds are there to pay for the cleanup?
    Mr. Cavaney. First of all, people talk about the tax, the 
concept of polluter pays. I want to reinforce what Mr. Reilly 
said, it is that in the large, large, large majority of the 
Superfund sites where remediation is underway, there is a 
responsible party. So you do in fact have a connection. The 
taxes were originally put forth to be able to fund orphan or 
abandoned sites, for which are only 7 percent of the remaining 
sites.
    It appears to me that if you're going to look at a 
comprehensive reform package, then you could also look at taxes 
from that perspective. But in the current environment, there 
are very few people who think a very comprehensive package will 
be able to get through Congress and be signed.
    So we strongly support making gains where we can. We think 
the gains included here in the Chafee-Smith bill go in the 
right direction and establish a lot of precedence.
    Senator Baucus. When we enacted Superfund in the Congress, 
in 1980, the committee report language basically said we in the 
Congress want to provide a fund to finance response action for 
liable party non-cleanup. Then we said, third, base the fund 
primarily on contributions from those who have been generically 
associated with such problems in the past and who today profit 
from products and services associated with such substances.
    I understand what you're saying and you make a very good 
point, it's well taken. But it is true also, isn't it, that if 
the only contribution is petroleum or petroleum feed stocks 
that the petroleum industry is not liable?
    Mr. Cavaney. Under the current view, EPA says we are 
responsible for far less than 10 percent of the sites. Yet 
historically we've paid 57 percent of the taxes. That's over $8 
billion since the fund started, and that's in addition to the 
$8 billion we've paid in cleanup under Superfund and under the 
State cleanup and other Federal statutes.
    Senator Chafee. Senator Crapo.
    Senator Crapo. Thank you, Mr. Chairman. I'll followup a 
little bit on that question, but maybe with some other members 
of the panel. In response to some of my earlier questions, it 
turns out that the Governors' Association, the Attorney 
Generals Association and ASTSWMO do not really have strong 
objections to reimposition of the taxes in the context of this 
discussion. I can take it that Mr. Reilly and the Petroleum 
Institute do have a strong opposition to that. Ms. Florini 
would support the reimposition of the taxes.
    I'd like to know where the other members of the panel come 
down on that. Mr. Gregor, do you have a position on that? Would 
your support for the bill be impacted by whether the taxes were 
reimposed?
    Mr. Gregor. I think from the standpoint of local 
government, we're probably a little more neutral on the revenue 
source and more concerned that there be adequate funding to 
meet the demand of site work that needs to be done.
    Senator Crapo. I take that to mean, then, that if a 
decision to reauthorize the taxes were made, that would not 
cause you to withdraw support for the bill?
    Mr. Gregor. That's correct.
    Senator Crapo. Mr. Nobis?
    Mr. Nobis. Usually in the case of a small business like 
ourselves, dealing with a Superfund site, usually what they are 
trying to recover in costs from us is pretty small. To me it 
would seem that a lot more money would be saved if they really 
wouldn't come after the small businesses. In my community, they 
spent millions of dollars just trying to collect the millions 
they were trying to get from us. I would think there would be 
more money available to clean up these sites if the small 
businesses were eliminated from having to pay for the cleanups. 
They could use that money for the attorneys to go to the 
cleanup of the sites.
    Senator Crapo. What about the question of reauthorization 
of taxes, however? Do you have a position on whether the taxes 
should or should not be reauthorized?
    Mr. Nobis. I would think for a small business like 
ourselves, we really don't understand much about 
reauthorization of the taxes. To us, it's just that we really 
need to have relief from this. It seems like so much money is 
spent on trying to collect the small amounts from the small 
businesses that that money could be used for the cleanup of the 
landfill. In our case, most of all the money that was actually 
used or collected from us didn't go to the cleanup of the 
landfill at all, it went to just the attorneys.
    Senator Crapo. Mr. Ford?
    Mr. Ford. Since the National Association of Realtors, we 
broker property, the tax issue wouldn't really affect us either 
way. Our sole purpose is, we want the properties cleaned up, 
put back on the marketplace so we can market them again. But 
the tax issue would really not make a difference to us either 
way.
    Senator Crapo. So in other words, your support for the bill 
would not be lost if the taxes were in there?
    Mr. Ford. Definitely not.
    Senator Crapo. Mr. Reilly, obviously there is a question of 
the taxes and the reauthorization. A question that I raised 
earlier also is whether the EPA can get around the caps on the 
NPL listings as well as some of the other efforts to try to 
bring the States more into involvement through the use of 106 
orders or other aspects of EPA authority.
    Do you think that the legislation we see right now does 
provide the necessary protections?
    Mr. Reilly. We very much support the recognition that the 
States have got the capacity to work their brownfields issues, 
work their voluntary cleanup programs. We very much support the 
issues in the bill where the States can give finality. Now, we 
take a look at the relief valves that are in the bill, and to 
us they appear more than adequate if there is an emergency, or 
if the State decides it wants to bring EPA back in. Those 
relief valves are there.
    Then implicitly, Senator Crapo, the agency has full 
authority under 106 orders to come in and order parties to 
clean up the site. I think one of the earlier panels made it 
sound as thought a company might just blow off a 106 order. 
Well, 106 orders carry a penalty of $25,000 a day. I'm not sure 
many companies would disregard an order like that.
    Senator Crapo. Does CMA have a position on this bill?
    Mr. Reilly. We consider it an excellent, we consider it a 
very good bill. And we really haven't had to take a firm 
position on it. We were delighted to hear at the beginning of 
the day that the Chair and the rest of the panel are going to 
talk to EPA, so maybe we don't have to take a firm position one 
way or the other, because the ground is shifting as we speak. 
We think it's a good bill.
    Senator Crapo. So at this point, there is not a stated 
position of CMA on the bill?
    Mr. Reilly. That's correct, Senator.
    Senator Crapo. I have no further questions.
    Senator Chafee. Thank you, Senator.
    I want to thank the panel. I'm sorry that Ms. Miller was 
not able to be here in time. Where is Ms. Miller? Apparently 
she arrived late, and as I understand, if she has a statement, 
we will put that in the record.
    As I announced earlier, tomorrow's hearing will be 
postponed, at the request of Ms. Browner, and we're going to 
have a chance to meet on the bill. If anybody has anything 
further they wish to put into the record, they will have until 
June 1st to do so.
    Thank you all very, very much for coming. We appreciate it.
    [Whereupon, at 12:50 p.m., the committee was adjourned, to 
reconvene at the call of the Chair.]
    [Additional statements submitted for the record follow:]
  Statement of Hon. Bob Graham, U.S. Senator from the State of Florida
    Mr. Chairman, members of the committee, thank you for the 
opportunity to speak on an issue that is very important to the State of 
Florida: Superfund reauthorization.
    Florida currently has 46 active sites on the National Priorities 
List. An additional 19 sites are being cleaned up by the Florida 
Department of Environmental Protection under their State cleanup 
program. The General Accounting Office's November 1998 report 
identifies 269 sites in Florida that are classified as awaiting an NPL 
decision. Florida therefore has a vested interest in the future of the 
Superfund cleanup program.
    The State of Florida has also initiated a brownfields cleanup 
program to address underutilized industrial properties across the 
State. These sites may have low levels of contamination present as a 
result of previous industrial activity, but do not qualify for the NPL. 
However, many property owners are concerned that even after a site is 
cleaned up to the State's satisfaction, the EPA may require additional 
action. This lack of certainty about future Federal liability can 
inhibit development of the property, contributing to urban blight and 
suburban sprawl.
    I look forward to working with my colleagues to find a way to 
revise existing Superfund law to encourage cleanup of brownfields. In 
addition, we need to revise Superfund's liability provisions to treat 
contributors of small quantities of waste fairly and to encourage 
recycling of materials to conserve our natural resources. Administrator 
Browner has initiated a variety of administrative reforms at the 
Environmental Protection Agency over the years to address these issues, 
and I look forward to discussing where we go from here.
                               __________
Statement of The Honorable Jim Marshall, Mayor of Macon, GA, on behalf 
                    of The U.S. Conference of Mayors
    Mr. Chairman and members of the committee, I am Mayor Jim Marshall 
of Macon.
    I am pleased to appear today on behalf The U.S. Conference of 
Mayors, a national organization that represents more than 1,050 U.S. 
cities with a population of 30,000 or more.
    I presently serve as a co-chair of the Conference's Mayors and 
Bankers Task Force, a role that I share with Mayor Paul Helmke of Fort 
Wayne.
    Mr. Chairman, the Conference's statement addresses a number of 
areas pertaining to the legislation before this committee today.
    It addresses key issues for mayors in this debate, noting 
particularly the need for liability relief and ``finality'' to promote 
brownfields redevelopment.
    It discusses why Congress needs to act on legislation to further 
the efforts of cities and other communities in recycling brownfield 
properties. It presents new information on the scope of the brownfields 
problem and benefits of positive policy reforms, a discussion which 
largely focuses on the results of the Conference's Second Annual 
Brownfields Survey that was released last month.
    It offers our perspectives on the status of lender support of 
brownfields redevelopment, particularly how legislative reforms can 
help stimulate additional private sector investment in these sites.
    Finally, it reviews how your legislation, ``Superfund Program 
Completion Act of 1999'' (S. 1090), responds to key issues raised by 
mayors on brownfields and selected Superfund reforms.
Key Issues for Mayors
    Mr. Chairman and members of this committee, you are well aware of 
the mayors' continuing interest in securing legislative reforms to 
Superfund, particularly issues pertaining to brownfields redevelopment.
    My colleague, Fort Wayne Mayor Paul Helmke, recently appeared 
before you to talk about the challenges of urban growth and the 
preservation of open space. His comments added to the substantial 
record of this committee on the need for legislative reforms to 
Superfund and other actions supporting the recycling of brownfields.
    As we review the legislation--``The Superfund Program Completion 
Act of 1999 ``--before this committee today, the Conference believes 
you have crafted a series of reforms that will help move brownfields 
redevelopment forward in assisting local efforts to recover these sites 
and return them to more productive use. These reforms, we believe, will 
help us move to the next level, beyond simply ``comfort letters'' on 
liability and limited grant commitments for assessments and cleanups.
    Most mayors will tell you that the major impediment in securing 
private capital for the clean up and redevelopment of brownfields is 
Superfund's liability regime.
    We believe that:
    1. It is time to free innocent parties, both public and private 
entities, from Superfund's unfair liability strictures. Parties that 
had no part in causing the contamination at individual sites should no 
longer be held liable under Federal law.
    2. It is time to create more certainty for the current owners of 
contaminated properties--the hundred of thousands of sites in every 
place in America that are likely to be brownfields at some time in the 
future--by providing them certainty in their cleanup costs and 
liability exposure. Owners of non-Federal interest sites need certainty 
about the rules that apply to them, certainty about the costs to 
remediate these sites and certainty that their actions terminate the 
risk of future liability.
    Mr. Chairman, your legislation reflects your understanding of these 
issues and the need to deal specifically with the challenges before us 
in addressing the many thousands of brownfields that already exist and 
to take steps now to reduce our predisposition toward creating more 
brownfields in the future.
    In explaining our views on innocent parties, let me provide some 
further perspectives from our vantage point as mayors. We have been 
living under a Federal statute and its strict liability regime--
although well-intended and largely aimed at more contaminated 
properties posing greater threats to the public--that has dramatically 
slowed progress by all parties in coming to terms with lesser 
contaminated properties, sites we generally describe as brownfields.
    It has produced a legacy of inaction by property owners, be they 
innocent or responsible parties, which we now measure in terms of 
thousands of properties and millions of acres. In our National Survey, 
which I discuss later, 180 cities provided estimates of the acreage of 
brownfields in their communities. The total acreage exceeds the 
combined land area of the cities of Seattle, San Francisco and Atlanta.
    And, we don't believe that continuing charges of who is or who is 
not more protective of the environment, etc. is in tune with the 
reality of what is happening in America. The nation will continue to 
warehouse acre upon acre of contaminated soils and materials for the 
foreseeable future, until we respect the scale of this problem and the 
many complicated dimensions associated with our current liability 
regimes.
    Rhetoric and political advantage will not cleanup one brownfield, 
but bipartisan legislative action will. We all need to put aside 
political posturing and confront the challenge before us.
    I would note, however, that have serious concerns about the 
proposed termination of the Superfund program at this juncture and the 
absence of a plan to reinstate the feedstock taxes. We believe that 
continued dialog on these issues and forward progress on the 
legislation are the best way to bring these issues to closure on a 
bipartisan basis.
    As a mayor and a sometime expert on real estate law, we are taking 
on a daunting task as we seek to enact reforms and policies to undo the 
substantial ``liability fear'' which is now part of our investment and 
development psyche.
    Mr. Chairman, your legislation moves the process forward, and we 
support your efforts in this regard.
    Today, I want to focus on two key issues in this debate.
    First, acting on the innocent party liability relief is a threshold 
issue.
    Your legislation offers new standards for absolving innocent 
parties of liability under Superfund. When mayors talk about this 
issue, they are most often focusing on brownfields. The Conference 
strongly believes that innocent party-relief is the crucial first step, 
legislatively, in encouraging more private sector attention to and 
investment in the clean up and redevelopment of brownfields.
    As a mayor and a representative of local governments, I encourage 
you to revisit these provisions to grant further relief to cities and 
counties who already hold, in public ownership, substantial inventories 
of these sites. The relief you have provided doesn't fully account for 
the many properties that have already been acquired by cities and other 
public agencies. For example, many sites now owned by cities were 
acquired in the normal course of performing local government functions, 
and many of these were acquired involuntarily. This is not the same 
thing as a private party acquisition, and as such, should be treated 
differently.
    We believe that innocent party relief, including further 
consideration of -existing local government holdings, will move private 
investment forward on many sites, particularly in cases where the 
property is abandoned or substantially underutilized and where the 
parties who caused the contamination are long gone. But, this is only 
one part of the equation.
    Second, ``finality'' must be provided to prompt current owners to 
move forward and cleanup contaminated properties.
    The issues surrounding what some might call ``active brownfields'' 
is perhaps the biggest challenge before us. Active properties--those 
now in use and underutilized and those that are inactive due to 
concerns about liability--remain the most difficult challenge for 
mayors and other public officials, and most certainly for the Congress.
    First, we support efforts to delineate among classes of properties 
and to allocate authority for final disposition of these properties 
between U.S. EPA and State governments. The Conference endorses reforms 
that respect State authority to administer their voluntary cleanup 
programs for non-NPL properties, without Federal intervention except 
under very limited and extraordinary circumstances.
    I would note that your legislation has provided a narrower range of 
EPA authority than what is provided in the bipartisan legislation (H.R. 
1300) offered by Representative Sherwood Boehlert.
    On a related issue, I would also note that have not fully vetted 
your proposal on vesting the States with broader authority on NPL 
listings.
    This balance between State autonomy to act and make final decisions 
affecting these properties versus the limited or no Federal interest in 
these properties needs to be brought to closure. Clearly, we have 
proven by the vast inventories of existing brownfields and those in 
progress that current law doesn't work.
    This issue continues to be driven by seemingly abstract debates 
about unreasonable constraints on EPA's role in this area. Under 
existing law, we know that EPA has rarely, if at all, intruded upon 
State decisions on non-NPL or non-NPL caliber sites. The price of 
keeping EPA over-empowered in this area is simply too high. At the end 
of the day, all of us need to keep our eye on the goal--it is about 
creating a more efficient and effective way of getting responsible 
parties, who are often the current owners of these sites, and 
prospective purchasers engaged in cleaning up these properties and 
returning them to more productive use.
    Closure on the issue of finality is the larger problem for 
brownfields and properties in active use where contamination exists. 
The threat of Federal liability and Federal enforcement action, albeit 
limited in practice, strongly influences private and public behavior, 
be it current owners or potential developers, of these sites.
    In my own community, we have many properties, which are likely 
contaminated and are essentially ``mothballed.'' Owners wait out the 
system, dragging down neighborhoods and hurting the broader community's 
effort to improve conditions in the city. Meanwhile, sprawl is 
continuing unabated, extracting more life from our existing 
neighborhoods and communities. This is the life cycle that the current 
liability regime sustains.
    The practical effects of this policy are not felt here in 
Washington or at the EPA offices, but rather by the citizens in 
individual neighborhoods and the communities where these properties are 
located. Today, we generally have to live with the decisions by owners 
and their choices in managing their properties, behavior that is 
strongly influenced by the punitive nature of the current Federal 
liability regime. We see property after property that is contaminated 
and fenced off in every community in this nation, producing what are in 
effect the ``gated communities'' of industrial America.
    Mr. Chairman, we know that your proposals are intended to break 
through this impasse. We don't believe there is one right answer to 
this problem, but we believe that you have offered a viable solution to 
this problem. Broader State empowerment, at this juncture, is so much 
better than the current system. The Conference would be pleased to work 
with you on these provisions as you work toward bipartisan consensus on 
these issues.
Why Congress Needs to Act on Legislation
    Mr. Chairman, we would like to begin by acknowledging your efforts, 
and those of others on this committee, to seek legislative reforms to 
help communities address brownfields and other burdens under Superfund.
    Securing consensus on legislative reforms to the Superfund law, 
with a particular emphasis on brownfields, is a top priority for the 
Conference of Mayors. The Conference believes the time has come to act 
decisively and promptly on brownfields and selected Superfund reforms.
    Mr. Chairman, the Conference also acknowledges and appreciates the 
many efforts by the Administration, particularly U.S. EPA Administrator 
Carol Browner, and others in Congress who have supported policies and 
initiatives, such as funding for local brownfields programs, to further 
our efforts to recycle America's land. These programs and policies have 
certainly helped, and again let us underscore that we are very 
appreciative of these efforts. But as a nation, we are not making 
progress at a rate that is quick enough or substantial enough given 
other considerations, which we discuss further in this statement.
    The problem of not redeveloping brownfields and our appetite for 
using open space is of epidemic proportions and we believe that, to 
date, our collective actions fail to match the challenge before the 
nation.
    Anyone who examines the brownfields issue acknowledges the 
importance of adopting broader strategies to promote the redevelopment 
of these sites. And, they also share a sense of urgency in acting 
promptly to address this national problem.
    For our part, we have tried to articulate why action and leadership 
by the Congress is needed. We have also directed our efforts in support 
of bipartisan efforts to move legislation forward. We also believe that 
taking on the substantial challenge of brownfields requires broad 
consensus among Democrats and Republicans, on many fronts. And, such 
consensus needs to be enduring over time, because the nature of this 
problem does not lend itself to a one-time legislative correction.
    We anticipate working with you and future Congress' on redirecting 
the tax code, infrastructure investment patterns particularly in 
transportation, and other policies in the environmental arena and in 
housing, to make recycling our nation's land part of the nation's 
development life cycle.
    We envision a broader commitment by Congress to challenge 
investment practices and public, private and individual decisionmaking 
that unnecessarily consumes our precious greenfields, as brownfields 
are discarded.
    We also believe that the Congress and the Administration must 
answer this challenge through bi-partisanship, which explains why the 
Conference has been steadfast in urging bipartisan action. To 
underscore our commitment to this principle, the Conference leaders 
recently wrote to the President, urging him to work with you, Mr. 
Chairman, and others in Congress on these issues.
    We also believe that mayors and many others have helped established 
a record on the need for Federal policy reforms and other actions to 
deal with brownfields in a more comprehensive manner.
    Mr. Chairman, when Mayor Helmke testified before you, he talked 
about many of these issues during your recent hearings on urban growth 
and open space. We commend you and others on this committee for 
dedicating the time to these issues.
    Your legislation responds to many of the key issues he talked about 
relative to helping us recycle these properties and putting them back 
into productive use. And, he explained, and mayors agree, that 
brownfields redevelopment is one of the most effective strategies we 
have in slowing the rate of consumption of open space and farmlands in 
proximity to urbanized areas.
    These reasons explain why the nation's mayors are strongly 
supporting bipartisan legislative efforts to redirect Federal policies 
and further engage with our communities in tackling the brownfields 
problem.
New Information on Scope of Brownfields Problem and Benefits of 
        Positive Policy Reforms
    Mr. Chairman, we are pleased to provide you and this committee with 
the findings of the Conference's Second Annual Brownfields Survey. 
Information from this report supports many of our statements about why 
legislation is needed. It also substantiates many of the key provisions 
in your legislation.
    We have provided you with a copy of the full report. In this 
statement, we provide some of the key findings to simply amplify what 
we believe are key issues before the committee today as you prepare for 
action on pending legislation.
    First, the findings confirm that brownfields are a national 
problem, which is--very broad in scope. Our results are drawn from more 
than 220 cities, a sample of cities, both large and small, in 39 States 
and Puerto Rico.
    In our survey, 180 cities reported that, collectively, their more 
than 19,000 brownfields sites represent more than 178,000 acres, a land 
area which I already noted is larger than the cities of Seattle, San 
Francisco and Atlanta combined. This sample size represents a 
relatively small universe of the nation's more than 20,000 
municipalities, suggesting a scale to the problem that is disturbing at 
best.
    Cities were asked to identify the obstacles to redeveloping 
brownfields in their communities. Of the top three responses, the need 
for cleanup funds were identified as the No. 1 obstacle, followed by 
liability issues and the need for environmental assessments. The 
ranking of these obstacles is the same as last year's survey of about 
140 cities.
    Mr. Chairman, we note that your legislation deals directly with the 
top three issues that were identified in our survey. S. 1090 addresses 
liability issues affecting innocent public and private parties for 
prospective purchasers and contiguous landowners. Your legislation also 
specifically authorizes funding for assessments of these sites and 
funding to clean them up.
    We also found that three out of every four cities expressed the 
view that their communities will need additional resources beyond 
cleanup funds and assessment funds to help them redevelop brownfields. 
This finding underscores earlier points in this testimony about the 
need to look at the tax code and other incentives as well as how 
infrastructure investment dollars are being deployed.
    The survey also documented the substantial benefits that can be 
realized for cities and the Nation through the redevelopment of these 
sites. About two-thirds of the respondents provided estimates of local 
revenue gains which could be realized through redevelopment of 
brownfields. Collectively, they estimated the potential local revenue 
gains of nearly $1 billion annually under a conservative estimate and 
about $2.7 billion annually under an optimistic estimate.
    In a related area of inquiry, we asked cities to provide us with 
estimates of how many new people they could absorb without adding 
appreciably to their existing infrastructure. While 180 of the 
respondents indicated they could -absorb more people, only 115 could 
provide actual numbers.
    Astoundingly, these 1 15 cities reported that they could absorb 
more than 3.4 million without adding appreciably to their 
infrastructure, a population about equal to the City of Los Angeles, 
our nation's second largest city. To put these numbers in another 
context, this capacity is equal to about 16 months of the nation's 
population growth.
    In a relatively small sample of municipalities nationwide, albeit 
generally larger ones, the survey provides clear evidence of the 
substantial, incumbent carrying capacity of existing communities. If we 
can find ways to tap these capacities, it offers the potential for 
substantial savings to all of the nation's taxpayers. Consider the 
potential savings to the Nation if we can minimize the public and 
private costs of building the equivalent of one new Los Angeles City 
every 16 months over the next decade.
    Consider the implications in terms of our consumption of land. If 
we pursue broad policy initiatives, like an expanded commitment to 
brownfields and other means to reinforce existing communities, we could 
slow consumption of our farmlands and open spaces as well. As one 
example of such supportive policies, the Conference has previously 
indicated the mayors' support for Congressional action on the ``Better 
America Bonds'' proposal.
    In the area of job creation, 168 cities estimated that reuse of 
these brownfields could generate more than 675,000 jobs. This supports 
our claims that there are vast opportunities to develop jobs in 
existing urban areas and neighborhoods, a particularly important 
finding as we continue to implement welfare reforms emphasizing welfare 
to work.
    Finally, in our findings on the status of State voluntary cleanup 
programs, cities reported that where such programs were in effect, a 
sizable majority indicated that these programs were at least 
satisfactory, if not better. Alternatively, you can describe these 
results more negatively by combining cities that indicated the 
questions on State voluntary programs were not applicable with those 
giving their State a ``not very good'' or ``poor'' ranking. Under this 
method, more than one-half of the respondents indicated that voluntary 
cleanup programs didn't apply or they were ranked poorly. This 
assessment suggests the need for further investment in State voluntary 
cleanup -programs, as you have provided in S. 1090.
    Overall, we believe that these findings strongly support the thrust 
and intent of key provisions in S. 1090 in advancing local efforts to 
assess, cleanup and redevelop brownfields in communities all across the 
nation.
Status of Lender Support of Brownfields Redevelopment
    Mr. Chairman, as you know, the Conference has been working 
extensively with bankers and other financial interests to explore ways 
to increase investment in brownfields redevelopment.
    Last year we formed the Mayors and Bankers Task Force to work with 
representatives of the Federal Home Bank System to examine ways to 
facilitate investment by FHBS member banks in brownfields.
    We have learned that liability under Superfund is their dominant 
concern. Despite progress in securing ``comfort letters'' at many sites 
and growing confidence in State program efforts, there is real anxiety, 
and we would wish otherwise, among bankers and other lenders on these 
issues. The specter of Superfund liability severely limits their 
ability to increase the flow of private capital into these projects.
    We have heard repeatedly--in our work with members of the Federal 
Home Loan Bank System and in our other activities with financial 
interests--that lenders are not willing to move aggressively on 
brownfields until there are legislative reforms to Superfund.They have 
told us that the private sector is prepared to substantially increase 
capital flows to projects on brownfield sites as soon as Congress 
enacts legislation that explicitly shields innocent parties from 
Superfund's liability scheme.
    Today, we are enjoying the benefits of one of the longest economic 
expansions in our nation's history. If there is a time to enact changes 
to stimulate private sector investment in these sites, it is now. This 
is the time to demonstrate to investors and others--when private 
capital is plentiful and available for new investment opportunities--
that brownfields redevelopment can be successful. Such successes will 
help carry future efforts to attract investment in brownfields during 
the leaner times which will inevitable come as the economy moves to 
other cycles.
    Mr. Chairman, when mayors talk about brownfields, our Federal 
partners sometimes only hear us asking for Federal partnership 
resources in support of brownfields redevelopment, as if mayors are 
suggesting that public resources alone will solve the brownfields 
problem. As you know, mayors are fairly attuned to the realities of our 
market economy. We know that the private sector is the dominant 
investor and the pivotal actor in determining how successful we, as a 
nation, will be in recycling brownfields.
    It also explains the particular priority we place on ensuring that 
any legislation include liability protections for innocent third 
parties.
    However, conversely, we also know that a market economy, fueled by 
liability reforms, doesn't respond fully to the problem either. There 
are many types of brownfields in all circumstances and locations. For 
these reasons, we also know that public investment is crucial in 
defining our success in recycling these sites.
    Again, Mr. Chairman, your legislation accounts for these realities 
by providing resources directly to communities to help us assess and 
clean up these sites, providing us with added resources and capacities 
to partner with the private sector.
    ``Superfund Program Completion Act of 1999''
    Mr. Chairman, finally, let me amplify further some of our views on 
specific provisions of the legislation before this committee.
    First, I want to again note the liability reforms provided in your 
legislation, an area that was just discussed earlier in my statement. 
These provisions need to more fully address the many circumstances 
where cities and other public agencies unfairly find themselves subject 
potentially to Superfund's strict liability standards.
    The legislation makes important changes to relieve cities and other 
local governments of liability exposure in their ownership or 
management of brownfield properties acquired after this legislation 
become law. As I noted earlier, the Conference urges you to include 
additional liability relief to account the many circumstances where 
local governments, in their operations and activities, have previously 
acquired such properties. We believe that H.R. 1300 provides an 
excellent model for the provisions that would address these issues.
    S. 1090 authorizes funding for both assessment efforts and local 
cleanup programs, providing criteria to help U.S. EPA determine how to 
deliver these resources in support of local programs. We are pleased 
that the bill expressly authorizes these commitments to site assessment 
and cleanup. We also urge you to provide Congressional appropriators 
with more flexibility in future years to increase commitments to these 
activities.
    We are pleased that the legislation provides some resources to help 
States further strengthen their voluntary cleanup programs. We hope 
that States will use these funds to place some priority, where needed, 
on efforts to bolster their States programs in support of brownfields 
cleanups.
    Considering the many thousands of such sites all across the 
country, we would certainly encourage the committee to explore how 
these funds could help State programs, particularly those focused 
largely on NPL-caliber sites, to address brownfields more responsively.
    We would also encourage you to consider ways to incentivize States 
to deliver simplification of the cross-cutting rules which are 
applicable at brownfield sites, such as how to rationalize the rules 
and program requirements under RCRA and LUST with provisions under this 
legislation.
    We are also pleased that this legislation clarifies the balance 
between State and Federal program authority, as I discussed earlier. 
Without more certainty about State authority and decisionmaking, we 
can't hope ever to provide the necessary assurances sought by 
responsible parties and potential investors in developing brownfield 
sites.
    In addition to these brownfields-related provisions, we also wanted 
to underscore our support for liability reforms that limit municipal 
liability at Superfund sites where municipal solid waste was disposed. 
We support the provisions you have provided to limit the liability of 
cities and counties at such sites and offer them more certainty on 
their liability costs.
    We do not believe it was Congressional intent to have municipal 
solid waste and municipal sewage sludge considered as a hazardous waste 
under CERCLA. Various studies have documented that municipal solid 
waste has been found to contain less than one-half of one-percent (.5 
percent) toxic materials. We therefore support the provisions that 
exempt generators and transporters of MSW from liability and limit 
liability for municipal owners and operators of co-disposal landfills.
    Mr. Chairman, the Conference supports extension of the Superfund 
taxes. While we understand your rationale for not including the tax 
extension in your pending legislation, we also believe that it is very 
important to secure legislative agreement to reinstate these taxes as 
soon as possible.
Closing Comments
    Mr. Chairman, we want to express again our thanks to you and 
members of this committee for holding this hearing today and for your 
continuing efforts to move this important legislation forward in the 
106th Congress. The nation's mayors believe that the time has come for 
bipartisan Congressional action on brownfields and selected Superfund 
reforms.
    On behalf of The U.S. Conference of Mayors, we appreciate this 
opportunity to share the view of the nation's mayors on these important 
issues.
                               __________
     Statement of Mayor Thomas Suozzi, City of Glen Cove, New York
    Chairman Chafee, Senator Baucus, and distinguished members of the 
committee, thank you and good morning. My name is Tom Suozzi. I am the 
Mayor of the City of Glen Cove, New York a small city on the Northem 
Shore of Long Island with a population of 25,000 and a land area of 
seven square miles. I am pleased to be here today to testify regarding 
the needs of local governments for municipal Superfund liability 
relief.
    I am here representing eight national municipal organizations that 
have worked together for many years to seek municipal Superfund 
liability relief so that we can resolve our involvement at these toxic 
waste sites, reduce litigation and transaction costs, and get on with 
the business of cleaning up and recycling these blighted sites into 
productive redevelopments in our communities. These organizations 
include American Communities for Cleanup Equity, which was formed 
nearly a decade ago to address these municipal Superfund issues, as 
well as the American Public Works Association, the Association of 
Metropolitan Sewerage Agencies, the International City/County 
Management Association, the International Municipal Lawyers 
Association, the National Association of Counties, the National 
Association of Towns and Townships, and the National League of Cities. 
Collectively, our organizations represent thousands of cities, towns, 
counties, and local agencies across the United States. We are 
responsible for the health, safety and vitality of our communities and, 
at the same time, for fulfilling the governmental duty to provide for 
municipal garbage and municipal sewage collection and disposal.
    First and foremost, we thank you, Senator Chafee, for your 
leadership and your commitment to addressing the issue of municipal 
liability in Superfund legislation. We also commend Senator Lautenberg 
for championing Superfund relief for local governments for many long 
years. Indeed, as you know, there has been broad, bipartisan, multi-
stakeholder consensus on this municipal Superfund relief issue for many 
years. We hope that the parties will continue to work to get this 
municipal Superfund issue resolved, this year, no matter what other 
issues may stand in the way.
    Local governments have a very serious problem. We have been saddled 
with years of delay, and millions of dollars of liability and legal 
costs under the Superfund law simply because we owned or operated 
municipal landfills or sent municipal solid waste or sewage sludge to 
landfills that also received industrial and hazardous wastes. Local 
governments have faced costly and unwarranted contribution suits from 
industrial Superfund polluters seeking to impose an unfair share of 
costs on parties that contributed no toxic wastes to these so-called 
``co-disposal landfill'' sites. We estimate that as many as 750 local 
governments at 250 sites nationwide are affected by the co-disposal 
landfill issue. The costs that our citizens bear as a result are unfair 
and unnecessary.
    Local governments are in a unique situation at these co-disposal 
sites. First, municipal solid waste and sewage sludge collection and 
disposal is a governmental duty. It is a public responsibility to our 
communities that we cannot ignore, and we make no profit from it. 
Second, the toxicity of municipal solid waste and sewage sludge has 
been shown to be significantly lower than conventional hazardous wastes 
and, as such, represents only a small portion of the cleanup costs at 
co-disposal landfills.
    The City of Glen Cove has experienced the threat of costs and delay 
associated with this Superfund issue. Located on the north shore of 
Long Island, Glen Cove has ten miles of beautiful waterfront, three 
public beaches, 300 square miles of nature preserves, and historical 
mansions built by some of America's wealthiest business leaders. One 
mile of that waterfront is a toxic Superfund dump and brownfield site. 
A World War II era munitions plant, the Li Tungsten plant, contaminated 
the site with low-level radioactive waste. This contamination included 
the dumping of radioactive and hazardous waste at an adjacent site that 
once was a municipally owned open dump, which is now part of the 
Superfund site. For many years, the Li Tungsten plant was a productive 
part of our community and economy. It was our largest job provider, the 
biggest contributor to the tax base, the supporter of community 
activities like the Little League team. Today, Li Tungsten has no jobs, 
provides no taxes, it no longer contributes to community activities 
like the baseball team. The site stands dangerous, polluted, and 
abandoned.
    The process of resolving the City of Glen Cove's municipal 
liability at this site has taken many years, and many dollars. In 
addition, at a different Superfund site, the Kin-Buc landfill in New 
Jersey, the City of Glen Cove was sued by industrial polluters seeking 
an unfair share of contribution because our city had transported 
municipal trash to that site. That legal process was likewise lengthy 
and costly. That's why Glen Cove supports legislative enactment of a 
municipal Superfund liability policy that will provide a simple, 
expedited, and fair method for resolving local government liability 
associated with these co-disposal Superfund sites. Glen Cove has been 
recognized as one of 16 national Brownfields Showcase Communities for 
its pro-active efforts to cleanup and redevelop its contaminated 
waterfront, and we will continue to do so. However, the costs and delay 
associated with the threat of Superfund co-disposal litigation has 
hindered communities across the nation, like Glen Cove, from focusing 
their energy on the vital cleanup and reuse initiatives that we need to 
be pursuing.
    Indeed, there is broad consensus that municipalities need and merit 
liability relief. For nearly a decade, our coalition has worked with 
you and other Members of Congress, and with the U. S. Environmental 
Protection Agency, to formulate a reasonable solution to the problem. 
In February 1998, with our support, the EPA finalized an administrative 
settlement policy to limit liability under Superfund for generators and 
transporters of municipal solid waste and sewage sludge, and for 
municipal owners and operators of co-disposal landfills. We continue to 
support this reasonable and fair EPA policy, and commend EPA for 
playing a pro-active role in seeking to address a very complicated 
problem.
    However, as fair and appropriate as the administrative policy is, 
we strongly believe that legislative action to resolve the municipal 
Superfund liability issue is necessary and justified. First, the EPA 
policy is only a policy, non-binding on the Agency and subject to 
change or challenge. Second, this policy has already been the subject 
of litigation, and the real threat of further litigation involving 
local governments remains. While we will continue to defend the EPA 
policy in court, as we did in Federal court in 1998, and to advocate 
its use by our members, we believe a change in the Superfund law to 
address this issue is necessary to reduce the costly litigation and 
delay that municipalities may continue to face at co-disposal sites. 
Third, we believe that legislative enactment of municipal Superfund 
liability provisions will give localities the certainty and confidence 
to make use of this settlement mechanism--much as the codification of 
lender liability Superfund provisions has provided certainty for the 
banking industry.
    For these reasons, we support a legislative resolution of the 
municipal co-disposal liability problem. We believe the provisions of 
the Superfund Completion Act, and the bill introduced yesterday by the 
Senate Democrats, generally would accomplish that objective, and we 
welcome any legislative proposals that will effectively address our 
specific concerns with this issue.
    Specifically, we have following remarks about the need for 
municipal Superfund liability clarification:
    We support liability caps for generators and transporters of 
municipal solid waste and sewage sludge, based on a per ton assessment. 
We believe that local governments who delivered municipal solid waste 
or sewage sludge to a landfill in good faith should have the option to 
settle out their liability at a reasonable and fair rate. The $5.30 per 
ton assessment in the Superfund Completion Act, also found in the EPA 
settlement policy, was determined based on an analysis of post-closure 
costs at RCRA Subtitle D landfills--in other words, the best estimate 
for what it would have cost the local government to close the facility 
if the facility were not a Superfund site contaminated with other 
parties' toxic waste.
    We support liability caps for local government owners and operators 
of co-disposal landfills, based on a percentage apportionment of 
liability. We believe that local governments generally should have the 
option to settle out their liability for 20 percent or less of the 
total cost of site cleanup. In addition, we believe that the liability 
share borne by local governments should be aggregated when two or more 
local governments, who owned or operated the facility either 
concurrently or sequentially, are identified as potentially responsible 
parties.
    We agree that the Environmental Protection Agency should be 
required to notify municipalities if they are eligible for the 
municipal solid waste and sewage sludge settlement mechanisms outlined 
above. Likewise, we support the approach of providing expedited 
settlement mechanisms to eligible municipalities. Finally, we support 
the approach of precluding third-party contribution suits or 
administrative Superfund orders against eligible municipal parties 
prior to their opportunity to settle their liability, or after they 
have settled their liability.
    We believe the ability-to-pay provisions of the law should apply to 
local government parties utilizing the municipal liability caps.
    We support the legislative language that protects from liability 
those owners and operators of publicly owned treatment works or 
``POTWs'' that, at the time of a release or threatened release, were in 
compliance with their Clean Water Act pretreatment standards under 
Section 307 and were not otherwise negligent in operating or 
maintaining their sewer system. Without specific protection from 
liability, otherwise innocent POTWs can be exposed to Superfund 
liability from industrial discharges into the public sewer system.
    We believe that there will be no orphan shares created by municipal 
co-disposal settlements, because the liability caps provided in both 
EPA's policy and the Superfund Completion Act represent municipalities' 
fair share of liability associated with trash and sewage sludge, based 
on long-standing and comprehensive analysis of the effect of such MSW 
and MSS at co-disposal landfill sites. However, if a ``statutory orphan 
shares'' provision is enacted as proposed in the Superfund Completion 
Act, we wish to emphasize that the requirement for an EPA assessment of 
such orphan shares should not have any effect of delaying the 
settlement of municipal liability under the co-disposal provisions.
    In summary, the local government organizations on whose behalf I am 
testifying today believe a legislative resolution of municipal co-
disposal Superfund liability is of critical importance. We believe the 
Superfund Completion Act, and the Senate Democrats' proposal, generally 
would achieve that objective.
    I also wish to comment on behalf of these municipal organizations 
on the importance of enacting brownfields funding and liability 
clarification law in this Congress. There is widespread consensus among 
local governments, business, and environmental and community groups 
that we need to put our brownfields back into productive reuse. 
Localities have had difficulty obtaining the resources necessary to 
assess, remediate and clean up the thousands of brownfields sites that 
impact nearly every American community. And the continuing uncertainty 
regarding the clarification of potential liability issues at brownfield 
sites has hindered the redevelopment of these areas. Local governments 
therefore support legislative approaches that provide liability 
clarification, brownfields remediation grants and loans to local 
governments and private parties, and continued assessment dollars. We 
commend the senators for addressing this topic, and urge you to carry 
it through into the enactment of a new brownfields law.
    Thank you, Mr. Chairman, for the opportunity to testify. I would be 
happy to answer any questions you or other members of the committee 
might have.
                               __________
   Statement of Tom Curtis, Director of the Natural Resources Group, 
                    National Governors' Association
    Good morning, Chairman Chafee, Senator Baucus, Senator Smith, 
Senator Lautenberg, and members of the committee. My name is Tom Curtis 
and I am Director of the Natural Resources Group at the National 
Governors' Association. I am pleased to be able to appear today on 
behalf of the National Governors' Association (NGA) concerning a 
subject that is a perfect example of how environmental and economic 
development issues crosscut: brownfields revitalization and the 
Superfund.
    As you know, NGA is a bipartisan organization. Our policy 
recommendations on Superfund and other issues can only be adopted by a 
vote of at least two-thirds of the nation's Governors and are generally 
supported by far more impressive majorities. We have certainly found 
that to be the case with Superfund. Our policy for the reform of this 
program is based on the States' experience as managers of thousands of 
site cleanups under State programs and as partners with EPA in many 
other cleanups at National Priority List (NPL) sites. That is to say, 
our views on this matter have been shaped not by politics, but by a 
common commitment: the Nation needs hazardous waste cleanup programs 
that are workable and efficient. Superfund reform has not been a 
partisan issue among Governors, and we hope sincerely that it will not 
become one in this Congress.
    As you know, the States have a strong interest in Superfund reform 
and believe that a few critical changes are needed to improve the 
Superfund program's ability to clean up the nation's worst hazardous 
waste sites quickly and efficiently. We know that there remain 
important differences between some of the key players in the Superfund 
debate, but we see the Superfund Program Completion Act of 1999 (S. 
1()9()) as a significant step toward resolving those differences. 
Clearly, Important compromises have been made in the development of 
this legislation, and we hope the spirit of compromise will continue on 
a bipartisan basis.
    We are committed to doing everything within our power to assist you 
in your efforts moving this bill through the legislative process. We 
hope to continue working cooperatively with both the majority and the 
minority to develop a final bill that enjoys broad bipartisan support 
and can be signed by the President.
    I will focus my remarks this morning on the two key provisions of 
the legislation that the Governors strongly support: brownfields 
revitalization and voluntary cleanup programs, and the Governor's right 
of concurrence with new additions to the MPL. In both of these areas, 
the bill provides for flexibility and certainty, which States need to 
ensure quick and successful cleanups.
Brownfields Revitalization and Voluntary Cleanup Programs
    The Governors believe that brownfields revitalization is critical 
to the successful redevelopment of many contaminated former industrial 
properties, and we commend you, Mr. Chairman, for making the 
brownfields issue a critical piece of this legislation.
    In considering how to restore brownfields sites to productive use, 
please remember the importance of State voluntary cleanup programs in 
contributing to the nation's hazardous waste cleanup goals. States are 
responsible for cleanup at the tens of thousands of sites that are not 
on the National Priorities List. A survey completed by the Association 
of State and Territorial Solid Waste Management Officials reported that 
33 responding States currently have 27,235 sites in State cleanup 
programs. To address these sites, many States have developed highly 
successful voluntary cleanup programs that have enabled sites to be 
remediated quickly and with minimal governmental involvement. For each 
of the past 5 years, States have completed work on an average of 1,475 
sites and have completed roughly 485 removals. It is important that any 
legislation supports and encourages these successful programs by 
providing the clear incentives and flexibility States need to continue 
them.
    The Governors believe that this bill provides clear incentives and 
flexibility to carry out State voluntary cleanup programs. There is no 
question that voluntary cleanup programs and brownfields redevelopment 
are currently hindered by the pervasive fear of Federal liability under 
the Comprehensive Environmental Response, Compensation, and Liability 
Act (CERCLA) of 1980. Many potential developers of brownfields sites 
have been deterred because even if a State is completely satisfied that 
the site has been properly addressed, and even if the site is not on 
the NPL, there is the potential for EPA to take action against the 
cooperating party under the CERCLA liability scheme. The bill addresses 
this problem by precluding enforcement by anyone at sites where cleanup 
has occurred or is being conducted under stale programs and by 
providing needed liability protections for innocent owners and owners 
of property contiguous to contaminated sites. In the instance where a 
State is unable or unwilling to take action at a site, there are 
reasonable exceptions to this preclusion of enforcement.
    The Governors believe that it is appropriate for EPA to take action 
at a site if a State makes such a request. We also commend you for 
including provisions that would allow EPA to come into a site only 
after EPA has given the Governor notice and an opportunity to cure. 
Without this very important provision, EPA would have the authority to 
take action at a site for virtually any reason. However, if the State 
has the opportunity to cure, the EPA will only be allowed into the site 
if the State cannot cure and not because EPA happened to discover new 
evidence before the State takes action.
    The nation's Governors believe that the provisions in your title on 
State voluntary cleanup programs would greatly encourage voluntary 
cleanup and thus increase the number of cleanups completed. All 
Governors are vitally interested in cleaning up hazardous waste sites 
in their States so that we can provide a cleaner environment for future 
generations. These provisions will enable States to cleanup hazardous 
waste quickly and safely and that is good for our environment.
Governors Concurrence in New NPL Listings
    Another provision that is important to the nation's Governors 
concerns the requirement for a Governor to request the listing of a 
site before a State's site may be added to the NPL. The nation's 
Governors believe such a provision is vital.
    There has been a great deal of discussion in recent years about the 
future of the Superfund program, and this legislation anticipates and 
plans for the completion of the Superfund program. EPA has told us that 
remedy decisions have been made at eighty-five to 90 percent of all NPL 
sites and that construction is underway. We believe that with the 
growth and maturity in State programs since the inception of the 
Superfund program, there will be a natural process of relying more and 
more on States to do most of the cleanups.
    Because of differences in capacities among States, the complexity 
and cost of some cleanups, the availability of responsible parties. 
enforcement considerations, and other factors, there needs to be a 
continuing Federal commitment to clean up sites under some 
circumstances. However, because States are currently overseeing most 
cleanups, listing a site on the NPL when the State is prepared to apply 
its own programs and authorities is not only wasteful of Federal 
resources, it is very often counterproductive. resulting in increased 
delays and greater costs. The Governors fear a case where there will be 
``two masters'' of the cleanup process. This is confusing to the 
remediating party and to the general public and an inefficient use of 
remediation resources.
    To avoid this, we advocate that Governors should be given the 
statutory right to concur with the listing of any new NPL sites in 
their States. The bill accomplishes this by providing for the request 
of a Governor before a site can be added to the NPL. In the event EPA 
discovers an imminent and substantial threat to human health and the 
environment, of course, it could continue to use its emergency removal 
authority, but any assignment of liability must then be consistent with 
liability assigned under State cleanup laws. We very much appreciate 
your recognition of this important provision.
    However, we are concerned with the provision that places a cap on 
additions to the NPL at 30 sites per year. Our position has been that 
the statutory right of Governors to concur with listing serves as an 
effective limitation on NPL listings. We fear an unforeseen scenario 
where a catastrophe occurs and more than 30 sites are in legitimate 
need of being listed and receiving Federal resources. We ask that you 
remove this provision from the bill and rely on the Governor's 
concurrence provision to provide an effective limitation on unnecessary 
NPL listings.
    Before I conclude my remarks, I would like to comment on several 
other provisions that we believe are necessary. S. 1090 provides for 
much-needed brownfields funding for site assessment and remediation, 
and we applaud you for this provision. We believe that financial 
assistance is a critical Federal responsibility and this provision will 
assist in the identification and cleanup of contaminated property. The 
bill provides for a State cost share of 10 percent for remedial action 
and the costs operations and maintenance. The provision is important to 
many States that would otherwise feel the financial burden of paying 
for 1()() percent of operations and maintenance.
Conclusion
    Mr. Chairman, I would like to thank you for your hard work on this 
important reform legislation and for providing me with the opportunity 
to communicate the views of the nation's Governors on Superfund reform. 
I have attached a copy of the NGA policy statement on Superfund reform 
and ask that it be included in the record of this hearings along with 
my statement.
    The nation's Governors appreciate your hard work in developing this 
proposal, and they believe that passing Superfund legislation in the 
106th Congress is critical. S. 1090 is an effective bill that we urge 
members of both parties to support. We hope that members of both 
parties will roll up their sleeves to pass Superfund reform 
legislation. The Governors look forward to working with both the 
majority and minority to bridge any differences and assist in crafting 
legislation that can be signed into law.
    I will be happy to answer any questions you may have.
                                 ______
                                 
 Responses of Tom Curtis to Additional Questions from Senator Voinovich
    Question 1: What is the appropriate Federal role, if any, at sites 
that are considered ``state interest''?
    Response. The nation's Governors believe that the appropriate 
Federal role for the Federal Government at ``state interest'' sites is 
financial assistance. The Governors believe that Federal dollars that 
go to states for program assistance are critical. In addition, the 
Governors are very supportive of the grant program in S. 1090 that 
would give moneys to states for brownfield assessment and remediation.
    The Governors' have also advocated a Federal role in state sites 
where certain conditions are met. In Title II of S. 1090, the U.S. 
Environmental Protection Agency (EPA) would be prohibited from taking 
enforcement actions at a site where a cleanup is being conducted or has 
been completed under state voluntary cleanup laws. The bill would allow 
EPA to take action at one of these sites if one of several conditions 
were met. Examples of these conditions are if a state requests EPA to 
come into a site or if there is a public health or environmental 
emergency and the state is unable or unwilling to take appropriate 
action. The Governors believe that these reopeners represent an 
appropriate role for the Federal Government in these sites.

    Question 2: Is there a clear way to distinguish Federal interest 
from state interests in the Superfund program?
    Response. We believe that the National Priorities List (NPL) is an 
appropriate distinction between Federal interests and state interests. 
If a site is not on the NPL, we believe that the site is in the state 
interest. If EPA would like to take action at a site, then it should 
have to meet one of the reopeners addressed in the response to Question 
#1 or list the site on the NPL, subject to a Governor's concurrence.
    I again thank you for the opportunity to testify and for the chance 
to respond to additional questions for the record. If I can be of any 
assistance as you continue to develop a bipartisan Superfund reform 
package, please contact me directly. I look forward to working with you 
on these very important issues.
                               __________
     Statement of Claudia Kerbawy for the Association of State and 
         Territorial Solid Waste Management Officials (ASTSWMO)
    Good morning. I am Claudia Kerbawy and I am the Chief of the 
Michigan Superfund program. I am also the primary spokesperson on 
reauthorization issues for the Association of State and Territorial 
Solid Waste Management Officials (ASTSWMO) and am here today 
representing ASTSWMO. ASTSWMO is a non-profit association which 
represents the collective interests of waste program directors of the 
nation's States and Territories. Besides the State cleanup and remedial 
program managers, ASTSWMO's membership also includes the State 
regulatory program managers for solid waste, hazardous waste, 
underground storage tanks, and waste minimization and recycling 
programs. Our membership is drawn exclusively from State employees who 
deal daily with the many management and resource implications of the 
State waste management programs they direct. As the day-to-day 
implementers of the State and Federal cleanup programs, we believe we 
can offer a unique perspective to this dialog and thank you for 
recognizing the importance of the State perspective.
    ASTSWMO and individual States have participated in the debate to 
reauthorize the Superfund law for the past three congresses. We wish to 
extend our gratitude to Senators Smith and Chafee for drafting a bill 
which appears to acknowledge the evolution of the Superfund program and 
the important role that States currently play in remediating 
contaminated sites. I would like to dedicate the first part of my 
testimony to speaking on the accomplishments of State programs. As with 
the Federal Superfund program, most State programs have had the benefit 
of 18 years to grow and mature in infrastructure capacity and cleanup 
sophistication. We believe it is very important that Congress 
understand the actual status of State programs, in order to make a 
fully informed decision regarding the future of the Federal Superfund 
program. The second part of my testimony will be devoted to analyzing 
key aspects of S. 1090 from a State program manager's perspective.
                  astswmo state accomplishments study
    The Association of State and Territorial Solid Waste Management 
Officials recently conducted a study on the accomplishments of State 
cleanup programs. The association asked States to provide detailed 
information on all short-term removal actions and long-term remedial 
actions conducted between January 1, 1993 and September 30, 1997 for 
each site in the State system where hazardous waste cleanup efforts 
were performed by States directly, under State enforcement authority, 
and under State voluntary cleanup and property transfer/brownfield 
programs. Sites listed on the National Priorities List, Resource 
Conservation Recovery Act corrective actions and underground and above 
ground storage tank and other petroleum spills were not included in 
this study. The association received information on 27,235 sites from 
33 responding States. I should note that the primary ground rule for 
the study was that information had to be reported site-specifically and 
had to be accompanied by background data. Estimates were not accepted 
or counted as part of either the individual State or national totals 
for work accomplished.
    While this study does not capture the complete site universe either 
on a national level or individual State level, it is the view of 
ASTSWMO that enough information was obtained to confirm that a trend 
has developed whereby on a national level States are not only 
addressing more sites at any given time, but are also completing 
(construction completes) more sites through streamlined State programs. 
State programs have matured and increased in their infrastructure 
capacity.
    Key results of the ASTSWMO study included:
    States have completed seven times as many sites per year these last 
four and three-quarter years than they did during the first 12 years of 
the program. During the first 12 years of the program, States completed 
202 sites per year on average. Over the last four and three-quarter 
years, States have averaged 1, 475 completions per year for a total of 
6,768 completions. State managers believe the large increase in 
completions can be attributed to the growth of State programs, the 
advent of State Voluntary Cleanup programs and the development of State 
cleanup standards (i.e., clearly defined endpoints).
    States have completed almost twice as many removals per year during 
the last four and three-quarter years of the program than they did 
during the previous 12 years of the program. On a national basis, 
States completed approximately 48 removals per year as compared to 293 
per year during the first 12 years of the program. This doubling of the 
pace of removals indicates a substantial increase in risk reduction the 
field.
    Three times as many confirmed contaminated sites have been 
identified and are working their way through the State system than 
during the first 12 years of the program. During the first 12 years of 
the program, States had approximately 1,850 sites working their way 
through their systems at any given time. Today, States are addressing 
an average of approximately 4,700 sites at any given time. NOTE: the 
word ``address'' could refer to site remediation, no further action 
designations, or site prioritizations. These findings clearly show that 
States programs have matured and State infrastructures have increased 
in their capacity to identify and address more sites.
    Only 8.9 percent (2,426) of the total sites identified by States 
(27,235) were classified as inactive. As the data indicate, State 
capacity to address large numbers of sites has increased dramatically. 
Most sites are being actively worked on by States either through 
traditional State Superfund programs or through voluntary cleanup 
programs and it is the professional judgment of the ASTSWMO membership 
that the majority of sites classified as inactive are probably of lower 
relative risk and not destined for the NPL due to the triage system 
employed by most States.
 analysis of s. 1090 ``the superfund program completion act of 1999'' 
                     brownfields and state response
    ASTSWMO wishes to commend the committee on the drafting of titles I 
and II of S. 1090. These are well crafted titles containing provisions 
which ASTSWMO can fully support. First, ASTSWMO supports the National 
Governors' Association position that Governors' should be given the 
statutory right to concur with any new National Priority Listing (NPL) 
in their State. We believe the facts support that position. States 
today employ a triage system whereby, the worst sites are addressed 
first. For example, only 8.9 percent (2,426) of the total sites 
(27,235) identified by the recent ASTSWMO survey were classified as 
inactive. It is, therefore, the strong belief of the ASTSWMO membership 
that most sites that have been identified within a State that could 
qualify for listing on the NPL are already being worked on by the 
State.
    We believe the views of our membership were validated by the recent 
General Accounting Office (GAO) Report entitled, ``Hazardous Waste: 
Unaddressed Risks at Many Potential Superfund Sites''. In this report 
the GAO reviewed the status of 3,036 sites which had pre-scored above 
28.5 but for a variety of reasons had not been placed on the NPL. Out 
of a total of 3,036 sites only 7.6 percent (232) were estimated by both 
EPA and State officials to potentially warrant listing on the NPL. This 
confirms that the EPA regional staff had utilized good judgment in not 
placing the vast majority of these sites on the NPL; it also confirms 
that the hazard ranking system could be improved.
    The question before this committee is what should be the 
appropriate role of the Federal Superfund program in the future? While 
there may be 40 plus States with State Superfund programs and Voluntary 
Cleanup programs there will always be States who choose not to develop 
a program and Federal Government assistance may be warranted. There 
will also be sites which due to either technical or legal complexity or 
cost, a State either cannot or may prefer to have the Federal 
Government address. The point I wish to stress is that with the current 
status of State programs the choice as to whether a site is addressed 
by the Federal Government or State government should be determined by 
the State. A Governor should be able to make the determination of 
whether a site will be listed on the NPL as specified in the S. 1090 
mandate that a site must receive Governors' concurrence prior to 
listing on the NPL. While it is EPA policy to routinely seek 
concurrence from the Governor before a site is listed on the NPL, it is 
not -mandatory that the concurrence be received. If a dispute should 
arise between EPA and a Governor the process within EPA is to have the 
Assistant Administrator for OSWER make the final determination. 
Frankly, that is not a satisfactory policy.
    Fortunately, there are very few sites where the States and EPA 
disagree, however, when a dispute does occur the site quickly becomes 
high profile and both the State and Federal Government can lose 
credibility. As indicated by the ASTSWMO survey and GAO survey, the 
States have clearly become the primary regulators for overseeing site 
remediation. The NPL should be reserved for those sites which both the 
State and Federal Governments believe warrant expenditure of Federal 
resources. The NPL is no longer reserved for the ``worst of the worst'' 
sites, rather the NPL has shifted to a venue for remediating sites 
which require Federal resources. The criteria for listing sites on the 
NPL may quickly shift from one of risk based determinations to one 
based on resource needs. We, therefore, support the provision for 
Governors concurrence as outlined in S. 1090.
    Second, States are responsible for remediating the vast majority of 
sites in this country and while it is crucial to clarify the issue of 
who actually will determine in the future whether a site is listed on 
the NPL; it is equally as important to clarify which governmental 
entity will be given the responsibility for determining when a site is 
fully remediated. In other words, the concept of finality needs to be 
addressed. The Federal Superfund statute technically applies to any 
site where a release occurs. However, the reality today is that States 
are responsible for ensuring the remediation of all sites which do not 
score above 28.5 using EPA's Hazard Ranking System (HRS)--the cutoff 
for Federal listing on the NPL. The EPA removal program is able to 
address some sites which are not listed on the NPL, but the program is 
designed to stabilize a site, not to ensure the full remediation of the 
site. EPA can not expend fund money for remediating a site not listed 
on the NPL. Consequently, the State is often still responsible for 
completing the remediation of a site even after an EPA removal action 
has been performed at a site.
    It is our belief that Congress needs to decide definitively whether 
EPA should retain a role in the remediation of non-NPL sites. While in 
practicality EPA has little or no role at these sites and as our survey 
indicated, the States are addressing the large universe of non-NPL 
sites, the statute still maintains a role for EPA In theory. Although 
the majority of these sites (typically brownfield sites) will never be 
placed on the NPL, they are still subject to CERCLA liability even 
after the site has been cleaned up to State standards. It is our belief 
that we can no longer afford to foster the illusion that State 
authorized cleanups may somehow not be adequate to satisfy Federal 
requirements. The potential for EPA overfile and for third party 
lawsuits under CERCLA is beginning to cause many owners of potential 
Brownfields sites to simply ``mothball'' the properties. We believe it 
is imperative that Congress seek to clarify the State-Federal roles and 
potential liability consequences under the Federal Superfund program. 
States should be able to release sites from both Federal and State 
liability once a site has been cleaned up to State standards. In 
situations which are deemed emergencies end where the State requests 
assistance, we believe the Federal Government should be able to address 
the site and if necessary hold the responsible party liable consistent 
with liability assigned under State cleanup law. Emergency actions 
should be the only exceptions to such releases from Federal liability.
    This has been a very contentious issue and we understand that many 
in the Administration have raised objections to provisions of this 
nature. We do not agree with the basis for these objections for several 
reasons. First, EPA does not have the ability to compel parties to take 
remedial actions at sites not listed on the NPL, except for removal 
actions. Second the majority of these sites will never be listed on the 
NPL, therefore, EPA does not have regulatory authority to spend fund 
money at these sites to perform the necessary remedial actions. Third, 
if a State should release a site from State liability (of course, all 
States have standard reopener provisions contained in their liability 
releases), and a situation should develop which warrants Federal 
attention, the State will act responsibly and contact EPA For example, 
the State of New Jersey, as well as Michigan and many other States 
throughout the country, has a very successful Voluntary Cleanup 
program. The New Jersey program has remediated over 6,000 sites and 
receives approximately 150 applications a month for entrance into their 
Voluntary Cleanup program. One of those sites, the Hoboken site, was 
remediated under the State Voluntary Cleanup program and a certificate 
of completion was issued by the State. Previously unknown mercury was 
later found to be present at the site and the State for financial and 
technical reasons called EPA in to address the site. Unknown conditions 
will occur at both NPL and non-NPL sites.
    We recognize that situations such as the Hoboken site will occur 
and believe that the exceptions specified in S. 1090 adequately address 
the situation. While it is clear in emergency situations that EPA 
should have the ability to enter a site, we believe the second prong of 
the condition must also be met, i.e., with State concurrence similar to 
our recommendation for listing sites on the NPL. We wish to avoid 
duplication as much as possible and therefore believe that if a State 
is capable of addressing the emergency then there is no need to utilize 
EPA's resources. The States have proven they act responsibly in these 
situations and it is to the State's advantage to notify EPA when either 
the State's financial, legal or technical resources are not sufficient 
to adequately address the problem.
    We believe the universe of sites to be addressed by State Cleanup 
(State Superfund and State Voluntary Cleanup) programs and the sites 
eligible for releases from Federal liability is the non-NPL universe of 
sites. It seems only practical to officially exclude proposed and 
listed NPL sites simply for the fact that much work has already ensued 
in order to place these sites on the NPL. Some suggest that the non-NPL 
universe can be divided into two categories, NPL-caliber and low risk 
sites. We are the primary regulators for non-NPL sites and we are here 
to tell you that there is no clear line that differentiates these 
sites. Many would suggest the bright line should be 28.5 (as determined 
by the HRS), but there are two problems with using this arbitrary 
cutoff. First, 28.5 is the quantitative scoring factor used to 
determine if a site qualifies for placement on the NPL. However, this 
figure is based on an arcane hazard ranking system which many EPA and 
State managers admit is flawed, so much so, that EPA and State managers 
in the GAO study identified only 7.9 percent of the 3036 pre-scored 
universe of sites for potential listing on the NPL. Second, in order to 
use the quantitative NPL-caliber designation, States would have to 
score sites prior to admitting them to a voluntary cleanup program (a 
suggestion we understand one EPA Region has made to a State). Clearly, 
the pre-scoring of a site as a condition for entering a State Voluntary 
Cleanup program would be a huge disincentive for marketing a State 
Voluntary Cleanup program and would not serve to move this large 
universe of sites to cleanup nor to facilitate economic redevelopment 
of brownfields. Essentially, the program has operated for years on a 
``you know it when you see it basis'' in identifying NPL-caliber sites. 
This is bad public policy and should not be acceptable for 
differentiating State and EPA roles and for providing certainty to the 
process. If a site is not to be listed or proposed for listing on the 
NPL, then the State should be free to address the site without EPA 
interference and the site should be eligible for the same benefits as 
any other site, such as liability releases. We believe legislation such 
as S. 1090 is needed and hope that Congress chooses to recognize the 
benefits of State programs which have had over 18 years to grow and 
mature and which clearly have become the leaders in site remediation 
today.
    Third, we are also pleased that S. 1090 seeks to streamline the 
program by providing a fixed State cost share, namely 10 percent of 
remedial action costs and 10 percent of operation and maintenance 
costs. The current cost share system has served only to exacerbate the 
tension which exists between State Waste Agencies and the U.S. EPA. 
Under the status quo the financial incentives for EPA and the States 
are diametrically opposed when considering final remedies for a site 
(States desiring more capital intensive remedies and EPA seeking 
remedies with lower capital costs and higher operation and maintenance 
costs). State Waste Officials believe this is a fair and well-reasoned 
position.
            fair share liability allocations and protections
    As State Waste Managers, our principal concern is ensuring the 
timely and effective cleanup of contaminated sites. We are not the 
legal experts and therefore will leave the analysis of this title to 
other State professionals. We would simply note, that the current 
liability scheme may not be entirely equitable to some responsible 
parties, but in the past it has provided a stable source of funding. We 
understand that reforms are needed and understand that the goal of the 
title is to insert a level of fairness into the program for parties 
such as municipalities and small businesses. ASTSWMO is in favor of 
providing relief to these parties so long as the pace of cleanup is not 
sacrificed.
                               conclusion
    In conclusion, while our membership has not had an opportunity to 
conduct an in-depth review of S. 109O, or to reach consensus on the 
bill's language, the initial impressions and reactions from our members 
is favorable. The primary provisions outlined in S. 1090 are elements 
ASTSWMO could support. These provisions appear to parallel ASTSWMO's 
basic positions regarding Governors' concurrence, brownfield liability 
release and State cost share. We are very encouraged and look forward 
to working with the committee as the process continues.
                               __________
Statement of Gordon J. Johnson, Assistant Attorney General of the State 
                              of New York
    My name is Gordon J. Johnson, and I am a Deputy Bureau Chief of the 
Environmental Protection Bureau in the of floe of New York Attorney 
General Eliot Spitzer. I am appearing today on behalf of Attorney 
General Spitzer and on behalf of the National Association of Attorneys 
General (NAAG). We very much appreciate the opportunity to appear 
before the committee to comment on S. 1090, the Superfund Program 
Completion Act of 1999, and thank Chairman Chafee and the staff of the 
committee for their consideration and assistance.
    The State Attorneys General have a major interest in Superfund 
reauthorization legislation. As chief legal of ricers of our respective 
States, we enforce State and Federal laws in our States. We help 
protect the health and welfare of our citizens, our environment and 
natural resources. Because many steps in the Superfund cleanup process 
necessarily involve legal issues, we often are called upon to advise 
our client agencies--both response agencies and natural resource 
trustee agencies--on how the law should be interpreted and implemented 
to achieve the desired cleanup or restoration goals. We often are also 
responsible for negotiating cleanup and natural resource damages 
settlements, and when a settlement cannot be reached, it is our 
responsibility to commence and litigate an enforcement action. We also 
defend State agencies and authorities when Superfund claims are made by 
the United States Environmental Protection Agency (EPA) and other 
Federal agencies against them.
    NAAG also has been deeply involved in the Superfund reauthorization 
process for many years. At its Summer meeting on June 22-26, 1997, the 
sole resolution adopted by the State Attorneys General addressed 
Superfund Reauthorization; a copy of this bipartisan Resolution is 
attached. The Resolution directly addresses many of the issues that are 
the subject of S. 1090. The NAAG Resolution arose from the State 
Attorneys General's recognition of the critical importance of the 
Superfund program in assuring protection of public health and the 
environment from releases of hazardous substances at thousands of sites 
across the country. We want to make the tasks of cleanup and protecting 
the public less complicated and more efficient, and to reduce the 
amount of litigation and the attendant costs that result.
    While the State agencies that administer cleanup programs are very 
knowledgeable about the engineering issues involved in selecting 
remedies and the cleanup process, it is the State Attorneys General who 
can best evaluate the legal consequences of changes to the current 
statutory scheme, such as how amendments likely will be interpreted by 
the courts and the effect of the amendments on enforcement, settlement, 
and cleanup. We are pleased that we will be able to bring to this 
committee our insights and experience in administering the Superfund 
statute.
                              introduction
    In New York, our office has been litigating Superfund cases since 
1981. A major impetus for the passage of the Comprehensive 
Environmental Response, Compensation and Liability Act of 1980 (CERCLA) 
was the chemical dumps exemplified by the infamous Love Canal and 
related Hooker Chemical Company sites in Niagara Falls, New York. 
CERCLA provided both the Federal and State governments essential legal 
tools to address the dangers posed by those and thousands of other 
sites in New York and throughout the country.
    Although there were significant problems in the Federal 
implementation of CERCLA during the 1 980's, the current statute is now 
getting the job done as intended. As a result of CERCLA, our of lice 
and the State's Department of Environmental Conservation have been able 
to obtain cleanups at over 600 hazardous waste sites in New York. While 
State voters in New York approved bonding for and New York committed 
$1.1 billion for site cleanups, because of the powers provided in 
CERCLA, responsible parties have contributed more than $2.3 5 billion 
toward site remediation and two-thirds of sites are being cleaned by 
the private parties responsible for their creation. Most States have 
had similar results. On the Federal level, some $10 billion of public 
money has been saved because 70 percent of all remedial actions at 
Federal Superfund sites are being performed by responsible parties.
    A major reason for this success is that cleanup liability under 
CERCLA is now clearly understood by responsible parties and government. 
It was not always this way. In the 1 980's, the meaning of numerous 
terms, the reach of the liability provisions, and the application of 
the remedy selection provisions were the subjects of contentious 
litigation. These lawsuits caused delays in cleanups, imposed 
substantial burdens placed on Federal and State programs, and increased 
everyone's transaction and cleanup costs. Those days are now over: 
potentially responsible parties (PRPs) now know what the statute means 
and where they stand, and thus most are ready to settle their liability 
with government. EPA's practices also have evolved, and it knows what 
it can require of PRPs. Moreover, EPA has developed practices that lead 
to earlier settlements and the quicker implementation of remedial 
decisions. Finally, the States' own Superfund programs have matured. 
Many of them are modeled on or mainly utilize the Federal statute. 
State officials too understand what CERCLA means and how to use it, and 
can obtain appropriate cleanups at minimal taxpayer expense. The 
message is clear: we must avoid changes to CERCLA that will reignite 
the courtroom battles over the meaning, scope, and implications of the 
law. At the same time, we must not lose sight of our primary goal--
cleanup of sites and protection of the public and future generations. 
We have no desire to replay the 1980's, even though we were generally 
successful in the courtrooms.
                                s. 1090
    We are pleased to note that S. 1090 is a departure from earlier 
bills arising in the Senate and House. S. 1090 contains some of the 
revisions that have been sought by the States for years, such as the 
cap at 10 percent for the State share of remedy operation and 
maintenance costs. In addition, unlike many previous bills, S. 1090 is 
limited in its overall scope and selective in its reforms. The bill 
does not amend the remedy selection and natural resource damages 
provisions of CERCLA. In many respects, those amendments that are in 
the bill are more narrow than those previously proposed, and wholesale 
alterations of existing statutory language are generally avoided. As a 
result, the defense bar will have fewer opportunities for legal 
challenges than under earlier reauthorization bills.
    S. 1090 also includes a brownfields revitalization program, and 
allows States to give cooperating PRPs protection from liability under 
certain circumstances, measures that will assist States in implementing 
their voluntary and brownfields cleanup programs. Unfortunately, other 
needed revisions that Attorneys General have been seeking for many 
years are not included. Clarification of the sovereign immunity waiver, 
modification of the IRS code to allow natural resource trustees to 
utilize the Fund to perform natural resource damage assessments, and 
revision of the natural resource damages statute of limitations, among 
other needed reforms, are not included in S. 1090.
    Despite some improvements in the proposed amendments, there are 
still serious problems with S. 1090's revisions to the liability and 
allocation provisions of CERCLA. While NAAG supports appropriate 
amendments to provide incentives to settle, reduce transaction costs, 
and provide limited exemptions from liability for truly ``de micromis 
parties'' and a reasonable limitation on liability for municipal solid 
waste disposal, many of the provisions of S. 1090 are unclear or go too 
far, shifting the costs of cleanup from polluters and responsible 
parties to the taxpayers. The proposed mandatory allocation process is 
unwise, and rather than making settlement easier and quicker, will 
complicate and delay settlements.
    Most critical, however, is the apparent defunding of the Superfund 
program, which necessarily will shift hundreds of millions of dollars 
more in costs, if not billions of dollars, to the States. We all wish 
that there was no need for CERCLA and the Superfund program, but the 
need is there and will be there for many years. Because operation of 
existing remedies, construction of new remedies, response to new spills 
and unaddressed sites, and governmental performance and oversight of 
these activities must continue beyond 2004, it is important that 
sufficient funds be dedicated to the Superfund program. When EPA lacks 
the funds to perform, the burden will shift to the States, which do not 
have sufficient resources to carry this burden alone. In addition, by 
creating new liability exceptions at NPL sites and imposing limits on 
listing new sites, we believe that S. 1090 will seriously erode the 
operation of the Superfund program and inevitably shift its costs to 
the States.
       1. liability exceptions and allocation/settlement process
A. De minimis and de micromis parties
    NAAG supports reasonable statutory changes that encourage early 
settlements with de minimis parties and liability exemptions for truly 
de micromis parties. However, it is important that these provisions be 
narrowly and carefully written to avoid inappropriate releases from 
liability and expansion of the ``orphan share'' that the Fund and the 
States then may well have to pay. We note that CERCLA always allowed 
EPA to settle matters quickly and in recent years EPA has been 
aggressively entering into such settlements without any changes in the 
law.
    Section 122(g) of CERCLA would be amended by S. 1090, altering the 
current authority regarding expedited settlements for de minimis 
parties. De minimis status would be presumed if the volumetric 
contribution is not more than 1 percent of the total volume. However, 
creating a statutory presumption will not serve to encourage such 
settlements and may have the opposite effect. For instance, at many 
sites, 1 percent is not the appropriate de minimis level; it is either 
too low or too high. The statutory presumption in S. 1090 allows an 
upward deviation from the presumed 1 percent de minimis level, but not 
downward, and then only if the President ``promptly identifies a 
greater threshold based onsite-specific factors,'' information the 
President is not always likely to possess because of the mandated 
expedited nature of the settlement process. Indeed, the 1-percent floor 
would exempt many contributors of waste at larger sites. For instance, 
the Hardage Superfund site in Oklahoma received over 21 million gallons 
of industrial waste during the 1970's, including plating wastes, 
solvents, coal tars, PCBs, and petroleum refining waste. One percent of 
the waste at the site is 210,000 gallons, an amount of hazardous waste 
which can wreak havoc on the environment.
    Moreover, creation of a presumption will lead to greater 
transactional costs, for any deviation from a presumption provides an 
additional ground for -non-settling parties to challenge the de minimis 
settlement. PRPs also will litigate the issue of whether they are de 
minimis based on the presumption, creating even further litigation and 
higher transaction costs. A statutory presumption should be 
reconsidered, and instead the appropriate de minimis level should be 
set on a site-by-site basis without any statutory presumption.
    Proposed Sec. 107(r) would exempt from liability ``de micromis'' 
parties that sent less than 110 gallons or 200 pounds of material 
containing hazardous substances to a site. We support an exemption for 
truly de micromis parties, such as Elk Clubs, pizza parlors, and Girl 
Scout troops, that sent minimal amounts of low-concentration and low-
toxicity mixtures to a site. However, depending onsite-specific 
circumstances and the type of hazardous substances involved, 200 pounds 
of solid material or 110 gallons of liquid (which is more mobile than a 
solid material and will usually have a weight of approximately 880 
pounds--four times the weight exemption for solid materials) can 
constitute a substantial contribution to a release. For instance, 110 
gallons of a spent solvent, such as trichloroethylene, could 
contaminate 10 billion gallons of drinking water to levels twice the 
standard. We believe exempting such a party statutorily and 
presumptively would be unfair and inappropriate, particularly without 
full consideration of concentration or toxicity, and would lead to 
extensive litigation by parties near the specified weight or gallonage.
B. ``Small'' Business Exemption
    Section 107 of CERCLA would be amended by Sec. 301 of S.1090 to 
include a new subsection 107(s), limiting liability at NPL sites for 
small businesses which are current or former owners or operators, 
generators or transporters. A ``small business'' is one that had no 
more than 75 full-time employees, or its equivalent, in the taxable 
year before receiving notification from the President that it may be 
liable, or had less than $3 million in gross revenue for that year. If 
the company qualifies, it escapes liability for costs and damages 
arising from activity which resulted in the disposal or treatment of 
material containing a hazardous substance at a facility before the date 
of enactment of the subsection. The exception is not applicable if the 
hazardous substance attributable to the business did or could 
``contribute significantly to the cost of the response action'' at the 
facility or is affiliated through ``any familial or corporate 
relationship'' with a liable party (proposed Sec. 107(s)(1)(B)-(C)); or 
if the business's activity which otherwise would give rise to liability 
``is determined by a court or administrative body of competent 
jurisdiction, within the applicable statute of limitation, to have been 
a violation of any Federal or State law pertaining to the treatment, 
storage, disposal, or handling of hazardous substances'' (proposed 
Sec. 1 22(p)(2)(F)).
    While NAAG supports appropriate relief to de minimis parties, the 
wholesale exclusion of a large class of otherwise liable parties based 
solely upon their size or revenues is unwarranted. With this exemption, 
no matter the amount of material disposed, liability is forgiven. Even 
if the business engaged in knowing, reckless, or grossly negligent 
activity, liability is excused. Small businesses which committed 
illegal acts would not be liable unless they happened to have been 
caught and convicted ``within the applicable statute of limitation,'' 
thus rewarding the successful concealment of illegal activities. 
Ability to pay is irrelevant, except that the very small number of 
small businesses that would be disqualified from the exemption still 
would be eligible for a reduction of their liability based on their 
ability to pay. See, proposed Sec. 122(g)(1)(D)(i)(III). The exemption 
would eliminate many PRPs, especially at municipal-owned, codisposal 
facilities, and the Fund and the States would have to make up for this 
share of liability. The States do not have the resources to absorb 
these shares.
C. Innocent Owner Protection and Contiguous Property Exemption
    In.contrast to such bills as H.R. 1300, which effectively exempts 
current owners from liability, S. 1090 offers a more thoughtful 
amendment at Sec. Sec. 103 and 104. The basic structure of the 
provision remains in Sec. 101(35) and, in contrast to H.R. 1300, there 
is no protection for an innocent landowner who knew or should have 
known of the disposal of hazardous substances. S. 1090 does change the 
standard for determining whether an owner should have known of the 
disposal. To prove that the current owner had no reason to know, the 
owner has to establish that it undertook all ``appropriate inquiries'' 
and exercised appropriate care (stopped the source, prevented future 
releases and prevented exposure to past releases) . EPA has the 
authority to adopt the ASTM standards and practices which describe 
appropriate steps a new owner should take, or to adopt others, taking 
into consideration various factors. Finally, there is a special 
provision for property for ``residential or other similar use'' 
purchased by a ``nongovernmental or noncommercial entity,'' for which a 
facility inspection and title search revealed no basis for further 
investigation. This last special protection is problematical because of 
the meaning of the phrases ``other similar use'' and ``noncommercial 
entity'' is unclear. This language would need to be clarified before 
NAAG could support it.
    These amendments affect only those current owners related by 
contract to responsible parties. If the current owner is not related by 
contract, then the owner does not have to comply with the ``due 
diligence'' provisions of Sec. 101(35), but only with the ``due care'' 
provisions of Sec. 107(b). However, it is possible, if not likely, that 
courts will define what constitutes ``due care'' without regard to 
whether the owner complied with the ``due diligence'' provisions of 
Sec. 101(35). If that occurs, then the net result likely would be that 
all current owners, possibly even if they have actual knowledge of the 
disposal before buying, will escape liability as long as they cooperate 
with the governments or other PRPs doing a cleanup by giving access and 
staying out of the way. NAAG opposes such a very broad exemption, which 
comes close to eliminating current owners from CERCLA liability. Such 
owners will reap the benefits associated with a taxpayer-financed 
cleanup of their properties, even though they paid very little for 
their land given their knowledge-of contamination. While S. 1090 
provides for a ``windfall'' lien, it is only available to the Federal 
Government, not to States, and is only created upon sale of the 
property. As a result, owners will receive the protections against 
State enforcement but the State does not even get the lien's limited 
benefit.
    Given the protections given innocent owners and the current defense 
regarding acts of unrelated third parties, CERCLA Sec. 107(b)(3), we 
see little need for the contiguous owners provision of Sec. 102.
D. Recyclers Exemption
    Under the new Sec. 107(u), there is no liability at any site for a 
person arranging for the recycling of certain recyclable material upon 
demonstration of specified requirements. ``Recyclable material'' is 
defined to include (1) plastic, glass, textiles, rubber (not including 
whole tires) and scrap metal, as well as minor amounts of material 
incident to or adhering to such scrap; and (2) spent batteries. Special 
rules are then provided for transactions involving these different 
kinds of recyclable materials.
    While we agree that recycling activities should be encouraged, we 
are nevertheless troubled by this exemption because it still is too 
broad and elements of it unclear. The special rules provide protection 
to recyclers so long as they comply with various ``Federal'' 
regulations or standards. However, only State regulations and standards 
are applicable in most States and there are no Federal requirements in 
existence. Therefore, the recyclers will have nothing to comply with 
and can act irresponsibly without incurring liability. Also, while 
recyclers claiming the exemption are required to demonstrate that they 
meet certain criteria, the bill is unclear on whether they, or EPA or 
the States, must demonstrate that they used reasonable care in their 
recycling activities.
    The exemption is particularly inappropriate as it applies to spent 
lead-acid batteries. Such batteries contain large quantities of lead, 
an especially toxic substance. Much of the lead in these batteries is 
in the form of lead oxide and lead sulfate, compounds that are 
relatively mobile and bioavailable in the environment. The sulfuric 
acid in these batteries (which has a pH approaching O) greatly enhances 
the solubility and mobility of these metals. Moreover, the secondary 
lead smelter industry has repeatedly argued that the RCRA regulations--
under either Federal or State authority--do not apply to spent 
batteries. These batteries, the industry argues, are raw material; they 
are not discarded, and thus not solid wastes and not subject to 
regulation under RCRA. See United States v. ILCO, Inc. 996 F.2d 1126 
(11th Cir. 1993). The lead components of spent lead-acid batteries 
would also fall within the definition of ``scrap metal.'' The 
limitations on the exemption for scrap metal are less stringent than 
the limitations on the exemption for spent batteries. As the exemptions 
are currently drafted, a person recycling the lead from spent lead-acid 
batteries could take advantage of the less stringent limitation for 
scrap metal. At a minimum, these problems need to be addressed.
E. MSW Exemption
    Section 301 defines ``codisposal landfill'' and ``municipal solid 
waste,'' and amends Sec. 107 of CERCLA to add new subsections (q) and 
(I), both of which address liability involving municipal solid waste 
(``MSW'') and municipal sewage sludge (``sludge'') at NPL sites. MSW is 
defined as (A) all waste generated by households, hotels and motels, 
and (B) waste generated by commercial, institutional and industrial 
sources to the extent (i) such materials are ``substantially similar'' 
to household or public lodging waste, or (ii) the material is waste 
that is collected with MSW and, regardless of when generated, is 
considered conditionally exempt small quantity generator waste under 
the Solid Waste Disposal Act. The term includes food and yard waste, 
paper, clothing, appliances, consumer product packaging, disposable 
diapers, office supplies, cosmetics, glass and metal food containers, 
grade and high school lab waste, and household hazardous waste.
    NAAG supports reasonable limitations on liability for disposal of 
municipal solid waste. Unfortunately, the limitations provided under 
Sec. 107(q) of S. 1090, as written, are confusing and appear to 
contradict the exemption provided by Sec. 107(t). They will not operate 
as intended, and in any event still are too broad. First, as written, 
liability at any NPL site is excused in proposed Sec. 107(q) for anyone 
liable as a generator or transporter if they are the ``owner, operator, 
or lessee of residential property from which all of the person's 
municipal waste was generated.'' Thus, as long as one's MSW comes from 
residential property, one is immune for liability arising from the 
generation of other hazardous wastes sent to any NPL site. Similarly, 
all business and nonprofit groups having less than 100 employees are 
exempt from any liability at NPL sites. There appear to be significant 
drafting errors in this provision, and it contradicts the liability 
provided by Sec. 107(t). Section 107(q) must be rewritten or removed 
from the bill. We are concerned about Sec. 107(q)'s intent to exempt 
all but large generators from liability.
    Assuming that the bill's real intent is described in the 
definitions and proposed Sec. 107(t), a substantial portion of PRPs 
would be relieved of liability even beyond those intended to be 
exempted by proposed Sec. 107(q). Under the definition of MSW, the 
relief applies to not just households, but a wide, almost all-inclusive 
group of business, commercial, institutional and industrial sources. 
For instance, at a number of hazardous waste sites, cosmetic 
manufacturers have disposed of sometimes substantial quantities of 
waste containing a variety of hazardous substances, e.g. acetone. Under 
S. 1090, such PRPs would escape liability because their wastes, at 
least arguably, are ``substantially similar to waste materials normally 
generated by households,'' i.e., cosmetics thrown away by households. 
Or, for another example, at municipal-owned, codisposal facilities, it 
is common to have a large volume of MSW and then a small volume of 
waste from commercial and industrial sources which is highly toxic. 
Many commercial, institutional and industrial facilities have used 
solvents in large quantities, and those wastes were often disposed in 
landfills over the years. PRPs could argue that their solvents are 
``substantially similar'' to solvents used in households and, 
therefore, exempt.
    In proposed Sec. 107(t), S. 1090 appears to adopt EPA's current 
settlement policy for municipal solid waste for generators and 
transporters, as well as for municipal owners and operators. However, 
the meaning of proposed subparagraph 107(t)(1)(C) is unclear. NAAG also 
supports liability limitations for municipalities owning or operating 
codisposal landfills. Municipalities need assistance in closing 
codisposal landfill sites that have become contaminated with hazardous 
substances. We are encouraged by the direction taken by S. 1090 
regarding municipalities' and generators' liabilities for codisposal 
sites, and would be happy to work with the committee to craft 
appropriate language to address this subject.
F. Allocation Process for De minimis and Other Parties under Proposed 
        Sec. 122(g)(1).
    Under current law, the President is empowered to perform an 
allocation whenever ``practicable and in the public interest.'' Section 
302 modifies current CERCLA Sec. 107(g) to require the President to 
contact each PRP eligible for expedited settlement consideration and to 
offer to reach a final administrative or judicial settlement with the 
party, apparently with respect to any response action at any facility. 
Eligible PRPs are (i) de minimis PRPs; (ii) site owners which did not 
conduct or permit hazardous substance activities on the property nor 
contribute to the release or threatened release by any action or 
omission; and (iii) natural persons, small businesses not otherwise 
exempt from liability, and municipalities which demonstrate an 
inability to pay a judgment. If the President concludes that a PRP is 
not eligible for settlement, the President must State the reasons for 
that determination to any PRP requesting a settlement. Under the 
proposal, ``[a]s soon as practicable after receipt of sufficient 
information to make a determination,'' EPA then is required to 
determine eligibility and to submit a written settlement offer to each. 
The information relied upon by EPA must be disclosed upon request.
    NAAG supports measures that promote early settlement with de 
minimis parties. However, we are concerned about the mandatory aspect 
of this provision and its application to every response action. The 
requirement that EPA make such offers for every facility may place an 
overwhelming burden on the agency, detracting significantly from its 
implementation of remedies. It is our general experience that EPA is 
prepared to enter into de minimis settlements when it has obtained the 
necessary information. Expansion of mandatory expedited settlement 
activities to all parties claiming an inability to pay at the earliest 
moment seems unwise, given the uncertainties such determinations might 
have on the State and Federal Governments' ability to pay for the 
cleanup once such parties have been excused from liability.
G. ``Fair Share'' Allocations and the Allocation/Settlement Process
    S. 1090 would establish another mandatory allocation procedure for 
all parties, the ``fair share'' allocation, in an effort to reach 
``fair share'' settlement at NPL sites. See proposed Sec. Sec. 122(n)-
(p). Although the heading of proposed Sec. 122(p)(2) suggest that the 
provisions are limited to ``statutory orphan shares and fair share 
settlements,'' which are governed by proposed Sec.  Sec. 122(n) and 
(o), the statutory text provides that ``[a]ll contribution and cost 
recovery actions under this Act'' against generators and transporters 
of MSW, municipal codisposal site owners and operators, de minimis 
parties and parties unable to pay are stayed until EPA offers them a 
settlement. Moreover, if the President fails to fund a statutory orphan 
share or fails to ``reimburse a party as required by subsection (g),'' 
or ``include a statutory orphan share estimate in any settlement when 
required to do so,'' the President is forbidden from issuing any 
further Sec. 106 orders or to commence or maintain any new or existing 
action to recover response costs at the facility. The President is 
required to reimburse the parties described above for any cost incurred 
in excess of the party's allocated share. We note that some of the 
provisions appear to contain what we assume are drafting errors, and 
the full meaning and intent of these provisions is unclear.
    As written, it appears that the bill provides that EPA inaction 
will stay adjudication of claims brought by States, or any other party, 
if EPA has not offered to settle its own claim or even has no claim. 
For instance, if EPA does not offer-a settlement to a de minimis party 
that may be liable for any response costs, even at non-NPL sites, a 
State's action to recover its costs under CERCLA are stayed. This is 
unwise.
    Moreover, if the Fund is insufficient to pay all orphan shares, the 
United States cannot commence a new action or continue an existing 
action to recover response costs even from parties who would not be 
entitled to a settlement or reduction in liability. Nor may it issue a 
Sec. 106 order, even against a party that is not entitled to a 
settlement offer. See proposed Sec. Sec. 111(b)(3); 122(p)(2)(B). By 
forbidding EPA from recovering costs or ordering remedial or removal 
actions, these provisions not only are self-defeating, but also could 
result in further endangerment of public health and the environment.
    The allocation process regarding orphan shares is likely to be very 
cumbersome in practice, and is unlikely to accelerate settlements or 
remove smaller parties from ongoing litigation and allocation. Because 
the President is required to estimate the orphan share at a site 
whenever seeking judicial settlement with any party, settlements are 
likely to be delayed and de minimis parties stalled in court. Moreover, 
by requiring the court to review orphan share information when 
evaluating a settlement, the bill is inviting the courts also to 
evaluate all prior settlements when deciding whether to enter a 
settlement. This will lead to needless litigation, delay, and costs. 
Finally, because of conflicts between provisions requiring EPA to treat 
parties claiming an inability to pay the same as de minimis parties, 
and the definition and treatment of orphan shares, the allocation 
process will be very complicated and will invite litigation rather than 
avoid it.
    Finally, other provisions make unclear whether and the extent to 
which the allocation and settlement provisions will, in effect, reopen 
past decrees. Because reimbursement of PRPs is expressly provided for 
by S. 1090, the language at proposed Sec. 122(n)(3) stating that a fair 
share allocation ``shall include'' response costs not addressed in a 
settlement approved by a Federal court prior to enactment needs 
clarification, as reevaluation of prior settlements is not expressly 
prohibited. Reopening of prior liability determinations could well 
impose huge liabilities on the Fund, making further cleanups 
impossible, paralyzing EPA and the Superfund program, and shifting 
costs to the States.
                  2. state response program amendments
A. Limits on NPL Listing
    Section 202 of S. 1090 proposes a limit on the number of new NPL 
listings. No more than 30 sites per year could be listed, or one site 
every 2 years per State on average. We are very troubled by this 
proposal.
    Sites should be listed on the NPL on the basis of the risk they 
pose to human health and the environment, and not be subject to an 
arbitrary numerical limit. Sites should be added as long as each poses 
a serious enough threat to warrant remedial action.
    EPA's ability to list a site based on a neutral evaluation of the 
risks it poses and need for remedial action is important to the States. 
Possible listing is a major incentive for PRPs to conduct voluntary 
cleanups. If the possibility of NPL listing is significantly reduced, a 
major incentive for a PRP to proceed with a cleanup will be lost, 
forcing the States to cleanup themselves and then seek recovery of 
their costs. Many States simply cannot afford this course.
B. Revision of the NPL
    Section 102(b) of S. 1090 requires EPA to revise the entire NPL in 
order to change the geographical descriptions of sites and delist 
portions of sites at which ``no release actually occurred,'' such as 
those portions whose groundwater is contaminated presumably by 
migration of contaminants from an area beyond the portion. This task 
places an unnecessary burden on both EPA and the States, to which EPA 
will undoubtedly have to look for assistance in performing this 
reevaluation. We doubt the utility of this exercise, and oppose the 
provision.
    As EPA has explained, ``the NPL does not describe releases in 
precise geographical terms, and that it would be neither feasible nor 
consistent with the limited purpose of the NPL (as the mere 
identification of releases) for it to do so.'' 55 Fed.Reg. 6154, 6156 
(Feb. 21, 1990). Indeed, to accurately describe geographical boundaries 
and to determine whether and where a ``release actually occurred'' 
requires a full remedial investigation and feasibility study (RI/FS) 
and, sometimes, the implementation of the remedial design and remedial 
action (RD/RA). After all, proof of where a release occurred can often 
be buried underground, or sometimes just cannot be determined. As EPA 
has explained on numerous occasions, delisting uncontaminated areas of 
sites or even accurately defining the geographical extent of releases 
``would be time-consuming, subject to constant reverification, and 
wasteful of resources.'' Id.; see, e.g. EPA's most recent statement on 
geographical boundaries, 64 Fed.Reg. 2942, 2943 (Jan. 19, 1999).
    Finally, relisting could extinguish State and Federal natural 
resource damages claims under one reading of the existing statute of 
limitations. One district court has ruled that CERCLA Sec. 113(g)(1)'s 
limited stay of the statute of limitations for natural resource damages 
claims at NPL sites until the President selects the remedy only applies 
within the geographical boundary of the site. United States v. ASDRCO 
Inc., 28 F.Supp.2d 1170 (D. Idaho 1998). New Mexico, New York and other 
States have filed an amicus brief urging the United States Court of 
Appeals for the Ninth Circuit to reverse that erroneous reading of the 
law. If upheld, S. 1090's reevaluation could retroactively eliminate 
many damage claims of the States and Federal natural resource trustees 
that they concluded were stayed, or force the premature filing of 
litigation prior to selection of the remedy even though such suits 
otherwise might be avoided or limited if the remedy selected addresses 
the restoration of the sites appropriately.
    Listing on the NPL does not establish, nor is it intended to 
establish liability. The reevaluation which would be mandated by this 
provision would need to be Allowed up repeatedly as new information 
becomes available. It serves no useful purpose whatsoever.
C. Brownfields Redevelopment and State Voluntary Cleanup Programs
    NAAG supports in general Sec. Sec. 101 and 201 Of S. 109() 
requiring EPA to establish grant programs to assist in brownfields' 
characterization and assessment and State response programs. Such 
grants will assist and strengthen State voluntary cleanup programs. 
NAAG also favors affording appropriate legal finality to cleanup 
decisions of qualified State voluntary cleanup programs and brownfields 
redevelopment programs. See Sec. 201 of S. 1090.
    We suggest that the committee make clear, perhaps through the 
addition of the term ``development'' to proposed Sec. 127(a)(1)(A), 
that redevelopment of brownfield sites can include noncommercial uses 
that are beneficial to the community. For instance, some brownfield 
sites might be developed for use as community centers, parks, 
libraries, and similar public facilities. Also, while the bill provides 
for consultation with the Secretary of Housing and Urban Development, 
it should also provide for consultation with the States.
    In addition, New York believes that the redevelopment of 
brownfields throughout the Nation should be encouraged and supported by 
other appropriate targeted financial incentives. Perhaps the simplest 
way to do this on a national level would be to add brownfields projects 
to the list of ``qualified facilities'' for which tax-exempt bond 
financing is available pursuant to section 142 of the Internal Revenue 
Code of 1986.
    For purposes of Sec. 201, Federal statutory provisions should be 
flexible enough to accommodate different State voluntary cleanup laws. 
States should be able to self-certify, subject to EPA's approval. After 
such approval, the State should be authorized to issue a release from 
Federal liability when a volunteer complies with a federally approved 
State brownfields program. In this fashion State brownfields and 
voluntary cleanup programs can work to their fullest potential.
                               3. funding
    Rather than dedicating a revenue stream to funding the Hazardous 
Substance Superfund, S. 1090 depends on an authorization allowing a 
one-time appropriation of not more than $1 billion from the Fund, to be 
used to enter into settlement agreements under the amended Sec. 122. 
Monies in the Fund can be used for response actions, i. e., actions 
designed to protect the public from releases, only if the total amount 
of moneys in the Fund is greater than specified amounts. Appropriations 
out of the General Fund are limited to a maximum of $900 million for 
fiscal year 2000, and are reduced by $25 million per year for 
succeeding years. Approximately $300 million in additional funds are 
authorized for appropriation out of the General Fund, but may only be 
used for newly specified purposes. The amount authorized is well below 
current spending levels.
    Like current law, S. 1090 also authorizes payment of natural 
resource damages from the Fund, but adds that there first must be a 
plan in place regarding restoration of the injured or destroyed 
resources. However, the IRS Code's provisions that forbid use of the 
Fund for such purposes, effectively overriding current Sec. 111, are 
not amended. There should be conforming amendments.
    Although S. 1090 imposes numerous additional costs on the Fund 
through liability exemptions and reimbursement requirements, overall 
funding is cut. It is likely that EPA will not have enough funds to 
perform removal and remedial actions, particular given the bill's 
directive to reimburse PRPs first, leaving either the public 
unprotected or the States--which do not have the funds--with the 
responsibility to fill the breach resulting from EPA's inability to 
fund cleanups. Moreover, because there are no dedicated revenue sources 
for the Fund, actual appropriations and the Superfund program will 
become the subject of yearly budget battles and closed-door special 
amendments during the appropriation process.
    It is our Federal and State officials' responsibility to protect 
the public health and the environment and to leave our children a 
cleaner environment. The funding provisions are inconsistent with this 
duty. Cleanups now implemented by the Federal Government and PRPs will 
be left to the States, whose ability to recover the costs will have 
been hobbled by other provisions of the bill. PRPs will be much less 
likely to step forward to clean sites absent extensive litigation 
because they will know that State governments will lack the funds and 
often the statutory authority to compel cleanups. This is hardly the 
legacy to leave the next generation. We strongly urge this committee to 
reconsider the funding mechanism, and insure that the Superfund program 
will have the funds necessary to truly complete the cleanup program 
without yearly appropriation battles.
                                 ______
                                 
      resolution of the national association of attorneys general
     adopted summer meeting june 22-26, 1997 jackson hole, wyoming
                 resolution--superfund reauthorization
    WHEREAS, the Attorneys General of the States have significant 
responsibilities in the implementation and enforcement of the 
Comprehensive Environmental Response, Compensation, and Liability Act 
(CERCLA) and analogous State laws, including advising client agencies 
on implementation of the cleanup and natural resource damage programs, 
commencing enforcement actions when necessary to compel those 
responsible for environmental contamination to take cleanup actions and 
to reimburse the States for publicly funded cleanup, and advising and 
defending client agencies that are potentially liable under CERCLA;
    WHEREAS, the Superfund programs implemented under CERCLA and 
analogous State laws are of critical importance to assure protection of 
public health and the environment from uncontrolled releases of 
hazardous substances at thousands of sites throughout the country;
    WHEREAS, Congress is currently considering legislation to amend and 
reauthorize CERCLA;
    WHEREAS, to avoid unnecessary litigation and transaction costs over 
the interpretation of new terms and new provisions, amendments to 
CERCLA should be simple, straightforward, and concise;
    WHEREAS, the National Association of Attorneys General has adopted 
resolutions in March 1987, July 1993, and March 1994 on the amendment 
of CERCLA;
                               state role
    WHEREAS, many State cleanup programs have proven effective in 
achieving cleanup, yet the CERCLA program fails to use State resources 
effectively;
    WHEREAS, State programs to encourage the cleanup and redevelopment 
of underutilized ``brownfields'' are making important strides in 
improving the health, environment, and economic prospects of 
communities by providing streamlined cleanup and resolution of 
liability issues for new owners, developers, and lenders;
                           federal facilities
    WHEREAS, Federal agencies should be subject to the same liability 
and cleanup standards as private parties, yet Federal agencies often 
fail to comply with State and Federal law;
                               liability
    WHEREAS, the core liability provisions of CERCLA, and analogous 
liability laws which have been enacted by the majority of the States, 
are an essential part of a successful cleanup program, by providing 
incentives for early cleanup settlements, and promoting pollution 
prevention, improved management of hazardous wastes, and voluntary 
cleanups incident to property transfer and redevelopment;
    WHEREAS, the current CERCLA liability scheme has in some instances 
produced expensive litigation, excessive transaction costs, and unfair 
imposition of liability;
                            remedy selection
    WHEREAS, constructive amendments to CERCLA are appropriate to 
streamline the process of selecting remedial actions and to reduce 
litigation over remedy decisions;
                        natural resource damages
    WHEREAS, constructive amendments to CERCLA are appropriate to make 
it less complicated for natural resource trustees to assess damages and 
to restore injured natural resources, and to reduce the amount of 
litigation that may result in implementing the natural resource damage 
program.
    NOW, THEREFORE, BE IT RESOLVED THAT THE NATIONAL ASSOCIATION OF 
ATTORNEYS GENERAL urges Congress to enact CERCLA reauthorization 
legislation that:
A. State Role
    1. Provides for delegation of the CERCLA program to qualified 
States, and for EPA authorization of qualified State programs, with 
maximum flexibility;
    2. Reaffirms that CERCLA does not preempt State law;
    3. Ensures that States are not assigned a burdensome proportion of 
the cost of operation and maintenance of remedial actions and in no 
event to exceed 10 percent;
    4. Clarifies that in any legal action under CERCLA, response 
actions selected by a State shall be reviewed on the administrative 
record and shall be upheld unless found to be arbitrary and capricious 
or otherwise not in accordance with law;
B. Federal Facilities
    5. Provides for State oversight of response actions at Federal 
facilities, including removal actions.
    6. Provides a clear and unambiguous waiver of Federal sovereign 
immunity from actions under State or Federal law;
C. Liability
    7. Provides a liability system that: a) includes the core 
provisions of the current CERCLA liability system that are essential to 
assure the effectiveness of the cleanup program; b) provides incentives 
for prompt and efficient cleanups, early cleanup settlements, pollution 
prevention, and responsible waste management; c) addresses the need to 
encourage more settlements, discourage excessive litigation, reduce 
transaction costs, -and apply cleanup liability more fairly and 
equitably, especially where small contributors and municipal waste 
landfills are involved; and d) assures adequate funding for cleanup and 
avoids unfunded State mandates;
    8. Provides reasonable limitations on liability for disposal of 
municipal solid waste;
    9. Provides an exemption from liability for ``de micromis'' parties 
that sent truly minuscule quantities of waste to a site;
    10. Encourages early settlements with de minimis parties that sent 
minimal quantities of waste to a site;
D. Remedy Selection
    11. Provides for the consideration of future land use in selecting 
remedial actions, provided that future land use is not the controlling 
factor, and provided that remedial actions based on future land use are 
conditioned on appropriate, enforceable institutional controls;
    12. Retains the requirement that remedial actions attain, at a 
minimum, applicable State and Federal standards;
    13. Retains the prohibition on pre-enforcement review of remedy 
decisions;
    14. Provides that cost-effectiveness should be considered, among 
other factors, in remedy selection;
    15. Allows EPA or the State agency to determine whether to reopen 
final records of decision for remedial actions, as under current law;
E. Natural Resource Damages
    16. Clarifies that in any legal action, restoration decisions of a 
natural resource trustee shall be reviewed on the administrative record 
and shall be upheld unless found to be arbitrary and capricious or 
otherwise in accordance with law, without precluding record review on 
other issues;
    17. Provides that claims for damages for injuries to natural 
resources must be brought within 3 years of that completion of a damage 
assessment;
    18. Allows Superfund moneys to be used for assessments of damages 
resulting from injures to natural resources and for efforts to restore 
injured natural resources;
    19. Retains the ability of trustees to recover damages based on any 
reliable assessment methodology;
    20. Does not revise the cap on liability for natural resource 
damages so as to reduce potential damage recoveries;
    21. Clarifies that trustees are entitled to recover legal, 
enforcement, and oversight costs;
F. Brownfields
    22. Strengthens State voluntary cleanup and brownfields 
redevelopment programs by providing technical and financial assistance 
to those programs, and by giving appropriate legal finality to cleanup 
decisions of qualified State voluntary cleanup programs and brownfield 
redevelopment programs;
G. Miscellaneous
    23. Allows EPA to continue to list new sites on the National 
Priorities List based upon threats to health and the environment, with 
the concurrence of the State in which the site is located.
    BE IT FARTHER RESOLVED that the CERCLA Work Group, in consultation 
with and with approval of the Environmental Legislative Subcommittee of 
the Environment Committee, and in consultation with NAAG'S officers is 
authorized to develop specific positions related to the reauthorization 
of CERCLA consistent with this resolution; and the Environmental 
Legislative Subcommittee, or their designees, with the assistance of 
the NAAG staff and the CERCLA Work Group, are further authorized to 
represent NAAG's position before Congress and to Federal agencies 
involved in reauthorization decisions consistent with this resolution 
and to provide responses to requests from Federal agencies and 
Congressional members and staff for information, technical assistance, 
and comments denying from the experience of the State Attorneys General 
with environmental cleanup programs in their States.
    BE IT FURTHER RESOLVED that NAAG directs its Executive Director and 
General Counsel to send this resolution to the appropriate 
Congressional committees and subcommittees, and to the appropriate 
Federal agencies.
    ABSTAIN: Attorney General Don Stenberg
                                 ______
                                 
 Response of Gordon Johnson to an Additional Question from Senator Max 
                                 Baucus
    Question: In your opinion would S. 1090 have the effect of 
reopening matters that have been addressed in consent decrees, or of 
revisiting any costs that were spent in accordance with pre-enactment 
administrative orders? If so, please explain how under the bill prior 
agreements and expenditures would effectively be reopened, and possible 
impacts.
    Response. There are several ways in which matters already addressed 
in consent or administrative orders are likely to be reopened under S. 
1090. First, S. 1090's transition rule, at the bill's Sec. 301(b)(2), 
does not apply to the limitation under proposed Sec. 107(t) regarding 
``municipal solid waste and sewage sludge'' disposed of at National 
Priority List (``NPL'') sites. See Sec. 301(b)(2)(A) (``the exemptions 
under subsections (q), (r), and (s) of section 107 . . . shall not 
apply'' to prior settlements or judgments''). Therefore, any generator 
or transporter that disposed of such waste streams at NPL sites and 
settled with the governments appears to be able to reopen its 
settlement and argue for the settlement terms provided in Sec. 107(t). 
This reopening is significant and disturbing.
    The number of parties qualifying for Sec. 107(t) liability 
limitation is large. The definition of ``municipal solid waste'' under 
Sec. 301(a) of S. 1090 is greatly expanded to include waste from 
industries and companies which is ``substantially similar'' to 
household waste. As we pointed out in our written testimony, at a 
number of hazardous waste sites, cosmetic manufacturers have disposed 
of sometimes substantial quantities of waste containing a variety of 
hazardous substances, e.g., acetone. Many commercial, institutional and 
industrial facilities have used solvents in large quantities, and those 
wastes were often disposed in landfills over the years. Under S. 1090, 
such potentially responsible parties (``PRPs'') would substantially 
limit their liability because their wastes, at least arguably, are 
``substantially similar to waste materials normally generated by 
households,'' i. e., cosmetics or solvents discarded by households. 
Moreover, a PRP is eligible for the limitation no matter the amount of 
waste disposed of by that PRP. Thus, an eligible PRP which disposed of 
thousands of tons of waste containing large quantities, in total, of 
hazardous substances such as those described above nonetheless would be 
entitled to the limitation.
    Any industrial or commercial generator in this large group of 
parties that paid more than the share specified in Sec. 107(t) will 
seek to reopen a prior settlement to reduce its payment consistent with 
Sec. 107(t) because the transition rule--Sec. 301(b)(2)(A)--fails to 
include Sec. 107(t). By this omission, a court could well conclude that 
Congress intended to afford past settlers as well as future settlers 
the benefit of proposed Sec. 107(t). This could result in reopenings of 
consent and administrative orders at all co-disposal facilities, which 
total an estimated 25 percent of all NPL sites. Only cases that have 
gone to final judgment in all respects are likely to be unaffected.
    Second, all of the transition rules at best protect only Federal 
court approved settlements or judgments from reopening, leaving the 
courts free to reopen administrative settlements or orders and any 
other determinations other than Federal court approved settlements and 
judgments. Proposed Sec. 122(n)(3) provides that a fair share 
allocation ``shall include any response costs at a National Priorities 
gist facility that are not addressed in a settlement or a judgment 
approved by a United States Federal District Court [emphasis 
supplied]'' before 180 days after enactment. Similarly, under the 
transition rule, the exemptions at proposed Sec. 107(q)-(r) ``shall not 
apply to any settlement or judgment approved by a United States Federal 
District Court [emphasis supplied]'' before 180 days after enactment. 
Sec. 301(b)(2)(A). Thus, administrative settlements and orders can be 
redetermined and reopened under S. 1090. We note that states have 
settled response cost cases in forums other than the Federal courts. 
State administrative settlements may not be exempt from reopening, and 
settlements or orders made in state courts might be attacked and 
effectively reopened through third-party actions in Federal court.
    Third, other provisions of S. 1O90 establish a series of 
requirements and procedures regarding allocation that are 
extraordinarily complicated and confusing. While the full import of the 
statutory language is unclear, it would appear that reopening of prior 
agreements is required under some provisions. For instance, S. 1O90 
also requires EPA to perform a final allocation and ``identify the 
total statutory orphan share owing for a facility,'' then to ``fully'' 
fund the orphan share and reimburse parties for expenditures above 
their share. See, proposed Sec. Sec. 107(o)(4), 107(p)(2)(J)(ii). This 
language could easily be construed as requiring EPA to perform an 
allocation when the last operable unit is constructed for a facility 
addressing all costs ever incurred and to reimburse any party that paid 
too much. Similarly, the fair share, orphan share, and reimbursement 
provisions apply to parties specified at proposed Sec. 122(g), which 
include de minimis parties, PRPs with a ``limited ability to pay,'' and 
certain small businesses. Nothing in the bill suggests that the 
allocation will not take into consideration prior payments by these 
parties or any other parties not specifically mentioned at 
Sec. 301(b)(2)(A).
    Thus, the bill could effectively reopen all orders or partial 
settlements reached prior to the enactment of this bill. Whatever these 
and other provisions are intended to mean, the confusion created by the 
complicated procedures and potentially conflicting obligations will 
lead to many years of further litigation.
    We also note that the transition rule for proposed Sec. 107(u) 
regarding recycling transactions provides that this new exemption 
``shall not affect any concluded judicial or administrative action or 
any pending judicial action initiated by the United States prior to the 
date of enactment of this Act [emphasis supplied],'' effectively 
eliminating their impact on pending litigation. However, that 
transition rule should also provide, at a minimum, that the exemptions 
of proposed Sec. 107(u) should not affect any pending judicial action 
initiated by a State as well as any pending administrative proceedings 
initiated by either a State or the United States. We also recommend 
that the transition exclusion be modified to provide that the new 
exemption does not apply to any judicial or administrative action or 
proceeding in which the United States or a State has made claims for 
recovery of response costs, rather than only those actions or 
proceedings initiated by a government. Who initiated the action should 
not determine whether the exemption applies, because state or Federal 
claims sometimes are raised in cases as counterclaims, crossclaims, or 
third-party claims, or when governments intervene in existing 
litigation.
    The effective reopening of prior agreements and expenditures in any 
case in which no final judgment has been entered would create 
substantial delays in the negotiation and settlement of current cases 
for all parties. Prior allocations would no longer provide guidance for 
future settlements, with parties likely lodging additional cross-claims 
based on the new bill's provisions. Transaction costs are likely to 
increase significantly, and cleanups could be delayed as performing 
parties reassess their obligation to implement cleanup orders.
                                 ______
                                 
   Responses of Gordon Johnson to Additional Questions From Senator 
                               Lautenberg
    Question 1. What effect, if any, would you expect S. 1090 to have 
on the likelihood of PRPs entering into consent decrees for the cleanup 
of NPL sites?
    Response. It is unlikely that any PRP which S. 1090 identifies as 
possibly eligible for an exemption from or limitation on liability will 
enter into a consent decree for at least 180 days after passage of the 
bill, or for a considerable period thereafter. First, the transition 
rules generally provide that the new provisions do not apply to any 
consent decree approved by a court 180 days after the bill's passage. 
Sec. 301(b)(2)(A); proposed Sec. 122(n)(3)(B). No party that might take 
advantage of the change in law would act before then. Second, even 
after this initial 6 months, many PRPs would decline to enter into 
consent orders until EPA performed the allocation or offered 
settlements, particularly those entitled by a statutory stay proposed 
under Sec. 122(p). Any PRP arguably entitled to an exemption or 
limitation on liability would seek it rather than enter into any 
meaningful consent order. The substantial, and ambiguous changes in the 
exemption and limitation provisions of the statute will limit the 
number of consent orders reached after passage of the bill until the 
courts construe the new provisions. That process will take years, as 
our experience has demonstrated.

    Question 2. What are the relative advantages and disadvantages of 
PRP lead cleanups being conducted under consent decrees versus 
administrative orders?
    Response. A remedial action under CERCLA may be conducted by the 
responsible party under either a consent decree or a unilateral 
administrative order (see CERCLA Sec. 122(d)(1)(A)). A consent decree 
is a settlement agreement negotiated by the parties, usually submitted 
for public comment, and approved by the court as an order of the court. 
A unilateral administrative order is, as its name implies, an order 
issued unilaterally by the agency, without negotiation and without the 
imprimatur of a court. For several reasons, a negotiated consent decree 
is preferable to a unilateral order as a vehicle for cleanup.
    First, because a consent decree is a negotiated agreement, all 
parties, including the responsible parties conducting the cleanup, 
understand and agreed to its terms. There is less likely to be a 
dispute over the meaning of those terms. Moreover, the responsible 
parties are much more likely to comply with a consent decree. whose 
terms they have agreed to, and to do so promptly, than they are to a 
unilateral order whose terms have been imposed upon them by the agency.
    Second, a consent decree is much more easily enforced. A consent 
decree almost always includes stipulated penalties, see CERCLA Sec. 121 
(e)(2), that is, a schedule of civil penalties that the settling 
responsible parties agree in advance to pay should any violation occur. 
Moreover, because a consent decree is a court order, it is very easy to 
seek assistance from the court, e.g. a further court order or 
sanctions, to ensure its timely implementation. On the other hand, 
because a unilateral order is not negotiated, there can be no 
stipulated penalties. To enforce the order, even for relatively minor 
infractions, EPA must refer the matter to the Department of Justice and 
a new lawsuit must be initiated.
    Third, the parties can agree to more expansive terms in a consent 
decree. For example, EPA routinely includes a settlement for past 
response costs--those incurred by the Federal Government and often 
those incurred by the state government--as part of a cleanup 
settlement. However, EPA has no authority to require payment of 
response costs under a unilateral administrative order. A separate 
lawsuit or lawsuits must be filed.
    Fourth, under section 113(f)(2) of CERCLA, the responsible parties 
that resolve their liability in a settlement are entitled to 
contribution protection from actions by other responsible parties. No 
such protection is afforded to the responsible parties under a 
unilateral order. More litigation, in the form of third-party 
contribution actions, is likely to result.
    Finally, EPA generally issues unilateral administrative orders only 
if agreement on a negotiated consent decree cannot be reached. Thus, 
entry of a consent decree usually results in a faster cleanup.

    Question 3. What would be the impact of S. 1090 on litigation and 
transaction costs, for state and Federal Governments, PRPs who are 
exempt or whose liability is capped, and for non-exempt PRPs?
    Response. As a preliminary matter, it can be noted that the current 
statute is producing intended results. For instance, EPA reports that 
70 percent of all remedial actions at Federal Superfund sites were 
being performed by responsible parties. The experience in most states 
is similar: about 70 percent of sites are being remediated under state 
consent orders. A major reason for this success is that the liability 
under CERCLA has been clear and unequivocal.
    It has taken 20 years since CERCLA, and over a dozen years since 
SARA, for the courts to construe the law. Instead of spending money 
litigating whether, and how much, they will pay at Superfund sites, the 
responsible parties are spending considerably less just calculating 
their share, through settlements and allocations. Similarly, the 
Federal and state governments have been able to conserve their 
resources and limit transaction costs.
    Unfortunately, S. 1090 proposes that we start all over with whole 
new categories of exemptions and limitations. All parties' transaction 
costs likely will shoot up to what they were in the first 10 years of 
CERCLA litigation. EPA's costs will rise also because of its mandated 
obligation to perform allocations in every case and make settlement 
offers to specified classes of parties, as well as promulgate 
additional regulations implementing S. 1O90's other provisions. PRPs 
who are exempt or whose liability is capped will also face additional 
transaction costs initially as the scope of the exemptions and any caps 
is determined.
                               __________
       Statement of Wilma Subra, Subra Co., New Iberia, Louisiana
    Thank you for the opportunity to testify on the issues of the 
Superfund Program. I have been involved in Superfund issues since the 
inception of Superfund, working with citizen groups living around 
sites, serving as a technical advisor on the National Commission on 
Superfund, providing technical assistance to citizens groups at 8 NPL 
sites through the Technical Assistance Grants process, and assisting 
citizens groups deal with voluntary cleanup efforts.
    The Superfund Program Completion Act of 1999 would limit and weaken 
the Superfund program and result in continued environmental damage and 
human health impacts from sites that would not be allowed to be 
addressed by the program The bill limits the number of new NPL sites, 
reduces the level of funding for the program, encourages State programs 
to assume program responsibilities in States that lack the financial 
and technical resources as well as the political ability to carry out 
the programs, limits and in some cases eliminates public participation, 
discourages voluntary cleanups by PRP's at sites prior to being listed 
on the NPL, and places at risk communities that live on or near fund 
led sites where the remedies were only containment.
Containment Remedies at Fund Sites
    A containment remedy is currently being implemented by EPA at the 
Agriculture Street Landfill Superfund Site in New Orleans. The remedy 
is being paid for with fund money. The landfill is a 95 acre site 
operated by the City of New Orleans from 1909 to 1965. The City then 
developed 47 acres of the landfill as private and public housing, 
recreational facilities and an elementary school. The residential 
housing on top of the landfill consists of 67 privately owned homes, 
179 rent-to-own town homes, and 128 senior citizen apartments. The 
containment remedy consists of removal and replacement of two feet of 
soil and waste in 10 percent of the residential area. Only the exposed 
soil/waste areas will be addressed. The waste will be allowed to remain 
under streets and structures and will be located a mere two feet below 
peoples' yards. When this remedy fails, and it will fail due to 
subsidence, very shallow ground water, and the area being located below 
sea level, resources from the fund would not be available, under the 
proposed bill, to finance the measures necessary to fix the containment 
remedy. This is just one example of the many sites where containment 
was utilized at fund led sites where the citizens will lose when the 
containment remedy fails and fund resources are not available to repair 
the failed remedy.
Governor Request Required
    Section 202.(b)(3) of the bill requires a written request from the 
Governor of a State in order to add a site to the National Priorities 
List. The requirement will severely limit the sites proposed for the 
NPL. Governors will be reluctant to request that the EPA add sites to 
the NPL when the potentially responsible parties at the sites are his 
financial campaign contributors. The only sites a Governor may consider 
requesting be added to the NPL are sites that are 100 percent orphan. 
In States that lack the financial resources or political will, such 
orphan sites already fall to EPA to fund the cleanup on a regular 
basis.
    The requirement that a Governor request a site be added to the NPL 
completely eliminates the ability of citizens to petition to have sites 
listed. In the State of Louisiana, the majority of the NPL sites were 
listed as a result of citizens involvement. The elimination of the 
citizen petition process is not appropriate. Allowing the State 
Governors to have the ultimate authority over the listing of sites 
prolongs the exposure of citizens living and working on or near the 
sites and citizens consuming aquatic and terrestrial organisms 
contaminated by sites.
Limit on Number of New Sites
    Section 202 (b)(2) limits the number of new sites that could be 
added to the NPL on an annual basis. The limit is set at 30 per year. 
That is less than one site per State per year. Such a limit is not 
sufficient to address the number of sites needing to be addressed under 
the Superfund program.
    For States that lack adequate financial resources to address sites 
that lack responsible parties, the limit on the number of new sites 
will be a burden that they will not be able to address. The burden will 
continue to be borne by the citizens living on and adjacent to these 
hazardous waste sites.
CERCLIS Sites
    The EPA will be required to investigate all sites currently on the 
CERCLIS list within 2 years. If the EPA does not investigate all of the 
sites and either list, prepare for listing or remove the sites from the 
CERCLIS list within 2 years, those sites become problems of the State. 
It is doubtful that the EPA has the financial and technical resources 
to investigate the more than 10,000 sites on the CERCLIS list. The 
States definitely do not have the financial and technical resources 
necessary to address the CERCLIS sites.
    The State of Louisiana currently does not have the resources to 
evaluate the more than 500 potential sites or to perform remedial 
activities at confirmed hazardous waste sites. More than 50 sites where 
hazardous waste needs to be cleaned up are waiting for State financial 
resources to become available. When sites pose an eminent and 
substantial threat, the EPA has to step in to finance and perform 
emergency removal actions for the State. The State of Louisiana and 
many others cannot address the current site load much less handle the 
Federal CERCLIS sites destined to be dumped on them under the terms of 
this bill.
State Response Programs
    Section 128 (b) sets forth the elements necessary for a State 
program. The elements listed lack minimum standards for a State program 
and a mechanism by which EPA is required to evaluate and approve a 
State program.
    The requirements lack a mechanism to insure that a State will be 
able to maintain sufficient financial and personnel resources to 
perform the response program. Financial resources can quickly be 
eliminated by State legislative bodies. A major industrial facility can 
hire an agencies core and experienced technical people. The State 
program would then lack the necessary organizational and technical 
expertise to administer the response program.
    The bill specifies adequate opportunity for public participation in 
a State program. States could basically isolate the public and the 
impacted community from participating in the State response program.
    The bill fails to provide a mechanism for addressing CERCLIS sites 
in States that do not qualify for the response program. The EPA will 
not have the authority or financial resources to address the sites in 
States that cannot qualify for response programs. When sites are not 
addressed properly in a State, the citizens in the area of the sites 
continue to be impacted as a result of chemicals associated with the 
sites.
    The bill further endangers public health and the environment by 
prohibiting the Federal agency from stepping in when there is a release 
at a State site. When the State fails to take appropriate actions the 
EPA must have the authority to act. The citizens must be assured that 
the Federal agency will have the ability to act when their State agency 
does not or will not act.
                               __________
Statement of Bernard J. Reilly, Corporate Counsel, DuPont, on behalf of 
                 the Chemical Manufacturers Association
                            i. introduction
    Good afternoon Chairman Chafee, Chairman Smith and members of the 
committee. My name is Bernard Reilly. I am Corporate Counsel for DuPont 
Company and am here representing the Chemical Manufacturers Association 
(or CMA). CMA is a non-profit, non-partisan trade association whose 
member companies produce more than 90 percent of the basic industrial 
chemicals manufactured in the United States. CMA and DuPont also are 
members of the Superfund Action Alliance (SAA), a combined group of 
businesses, trade associations and other concerned organizations that 
has been actively engaged in the Superfund debate for a number of 
years.
    CMA has worked on Superfund reform since the early 1990's with 
Members of Congress, the Administration, environmental groups, States, 
cities, and other business organizations. In addition, we have worked 
with EPA to improve the Superfund program through administrative 
reforms.
    I would like to commend Chairmen Chafee and Smith for their 
leadership over the years in trying to reform the Superfund law and for 
their introduction of S. 1090, the Superfund Program Completion Act. 
CMA recognizes the Senators' accomplishment in producing this bill. As 
long time participants in the efforts to reform Superfund, CMA 
understands that this is not an easy task and looks forward to working 
with both the Republican and Democratic members of the committee and 
the Senate on this bill.
    CMA has completed a preliminary review of the recently introduced 
bill. I would like to spend the next few minutes highlighting what is 
especially noteworthy, touching on a number of strong areas, and 
following with some areas that could be improved.
                    ii. noteworthy areas of s. 1090
    Clearly, the most important issue facing Congress at this point is 
the future direction of the program. As we have previously noted, after 
17 years of existence, there is more of Superfund behind us than ahead 
of us. According to EPA, nearly 90 percent of all non-Federal sites on 
the National Priority List (NPL) are undergoing cleanup, 60 percent 
will be finished by the end of this Congress and 85 percent will be 
cleaned up by 2005. Congress needs to determine what remains to be done 
under Superfund, how long it will take, and how much it will cost. We 
strongly commend the cosponsors of S. 1090 for recognizing these 
critical issues and taking appropriate steps to address them.
    CMA has prepared estimates of the funding required to complete the 
job at hand. These indicate that Superfund funding could be 
dramatically reduced and there would still be sufficient funds to pay 
for both remaining sites and sites that GAO and EPA have concluded will 
be added to the NPL in the future. Program spending levels should be 
adjusted accordingly to fit the future needs of the program in order to 
ensure that more funds than necessary are not appropriated. S. 1090 
does exactly that. Congress should take the next step and direct an 
independent study of funding needs.
    In addition to recognizing that Superfund is moving toward 
completing the job of cleaning up existing sites, and that the funding 
levels need to be adjusted accordingly, S. 1090 contains other 
important provisions. These include: finality for State cleanups; an 
integral Governor's role in the process of listing sites on the 
NPL;liability relief to ensure that brownfields sites are redeveloped; 
and a recognition of the States' primary role in cleanup.
              iii. areas of s. 1090 that could be improved
    Another aspect of this bill deserves credit at the same time that 
it raises some concerns about its implementation. This particular 
aspect has to do with the exemptions that are provided for certain 
parties and the allocation system that is set up to pay for those 
parties' shares. The bill deserves credit for recognizing that it would 
be wholly unfair to pass exempt parties' shares to the remaining 
parties at a site. The allocation system that is set up to determine 
those shares, however, appears to be flawed. Under this system, 
industrial parties at these sites not only will continue to pay more 
than their fair share of liability, they probably also will pay for 
shares attributable to exempt parties.
    As we all know only too well, it is not easy to develop fair, 
defensible, and acceptable liability allocations. CMA has advocated a 
streamlined system for several years, calling for the inclusion of 
certain basic elements but not overburdening the system with detail. 
The single most important element of any streamlined process is that it 
be administered by third-party neutrals who do not have a vested stake 
in the outcome. S. 1090 does not include this element. Instead, the 
bill designates EPA as the allocator. This is not appropriate given 
EPA's demonstrated, vested interest in preserving the Trust Fund and 
culture of assigning liability to ``deep pockets.'' The bill also lacks 
a defined process for information gathering and deadlines for assuring 
that allocations are completed in a timely manner.
    Fundamental reform to ensure the successful, cost-effective future 
of the Superfund program requires changes to areas including natural 
resource damages, remedy selection, and cost recovery programs. 
Improvements in the NRD program would help to ensure that the program 
focuses on the restoration of injured or lost resources, not surplus 
damages. Improvements in Superfund's remedy selection provisions, 
recognizing what is happening in the field and focusing on risk-based 
remedy selection, would help to ensure that cleanups are as fast, 
efficient, and cost-effective as reasonably possible. Finally, 
improvements in the Superfund cost recovery provisions would ensure 
that EPA is not allowed to recover costs that are ``not unreasonable'' 
and ``not unnecessary.''
                             iv. conclusion
    Chairman Chafee and Chairman Smith and members of the committee, 
thank you for undertaking the hard work necessary to produce the 
Superfund Program Completion Act. As I have said, the future direction 
of the program is the most critical issue facing us in reforming 
Superfund. We see that future as one in which sites currently listed on 
the NPL are cleaned up, and the remaining sites are addressed under a 
reduced program with reduced spending levels. We strongly commend you 
for taking an innovative look at these issues and addressing them in S. 
1090.
    We appreciate the opportunity to provide input into this 
challenging process. At this point, I would be happy to answer any 
questions you may have.
                               __________
         Statement of Karen Florini, Environmental Defense Fund
Introduction
    On behalf of the Environmental Defense Fund (EDF), I appreciate 
this opportunity to present our views on S. 1090, the ``Superfund 
Program Completion Act of 1999.'' EDF has been actively involved in the 
Superfund reauthorization process, serving on EPA's NACEPT Committee on 
Superfund and on the National Commission on Superfund, and testifying 
repeatedly on Superfund during the last several Congresses.
    We recognize that this bill differs significantly from earlier 
Superfund reauthorization bills introduced in this committee. Unlike 
its predecessors, S.1090 does not contain radical changes to current 
provisions on cleanup standards and natural resource damages--changes 
that we believe would have greatly weakened cleanups, gutted the 
polluter-pays liability system, and profoundly hampered recovery for 
natural resource damages.
    Nonetheless, S.1090 contains numerous objectionable provisions, 
compelling us to oppose it strongly. Key problems include:
    --sharp reductions in cleanup resources authorized, even as EPA's 
workload is expanded by the allocation process and other provisions;
    --dramatic slowdowns in the pace and quality of cleanups that are 
likely to result from the superficially innocuous fair-share allocation 
provisions;
    --the preferential status of funds for liability relief compared to 
cleanup;
    --the numerous holes in the Federal safety net for cleanups, 
including the unwarranted cap on the number of sites, the requirement 
that sites can be listed only upon a Governor's request, and 
restrictions on Federal authority at State-cleanups sites even where 
problems remain; and
    --over-breadth of some of the liability limitations.
    Before detailing the problems with the bill, I must address the 
related issue of Superfund's polluter-pays taxes. It is our 
understanding that the sponsors of this bill do not intend to introduce 
companion legislation to re-impose the taxes in conjunction with this 
bill, and indeed will oppose re-imposition of the taxes absent radical 
revisions to Superfund.
    In our view, this bill must be accompanied by companion legislation 
that re-institutes Superfund's polluter-pays taxes. In simple terms, 
it's time for the $4-million-plus daily tax holiday for industry to 
end. Since the taxes lapsed at the end of 1995, industry has benefited 
to the tune of more than $5 billion in avoided taxation. \1\
---------------------------------------------------------------------------
    \1\ This estimate is on the low side, as economic expansion in the 
years since 1995 would have produced tax revenues higher than the 
approximately $1.5 billion collected in 1995.
---------------------------------------------------------------------------
    Superfund embodies the polluter-pays principle--which is 
overwhelmingly supported by the American public--in two distinct ways: 
in its liability provisions, under which responsible parties must 
conduct cleanups themselves or pay for EPA's cleanup activities, and in 
its tax provisions. The taxes cover what the liability system does not: 
sites at which responsible parties cannot be identified or lack the 
resources needed for cleanups, and certain broader programmatic 
activities.
    But under S.1090, funds for cleanup operations would be 
appropriated from general revenues, not from the polluter-pays taxes 
[SPCA Sec. 401 (a), amending CERCLA Sec. 111 (p.89)]. \2\ We oppose 
this fundamental shift in the nation's dumpsite-cleanup strategy for 
both on principle and for pragmatic reasons. As a matter of principle, 
these taxes should be paid by groups with a closer relationship to the 
problem, namely industry, rather than individuals with a less-direct 
relationship, namely the general public. This is rough justice, to be 
sure, but rough justice is better than none.
---------------------------------------------------------------------------
     \2\ In addition, to the extent that cost-recovery actions produce 
amounts in the Trust Fund in excess of specified levels, those funds 
can be used for cleanups, but without any concomitant increase the 
annual authorizations [SPCA Sec. 401 (a), amending CERCLA Sec. 111 (h), 
p.98].
---------------------------------------------------------------------------
    From a pragmatic perspective, the existence of a dedicated stream 
of funds increases the odds that appropriators will spend those funds 
(at least most of them) for their intended purpose. It is true that, 
historically, appropriations have not kept pace with the level of tax 
revenues generated--but those accumulated funds have been financing the 
program for the last 4 years since expiration of the tax, thus 
fulfilling the original purpose of their collection.
    Additional concerns with the bill are set forth below. \3\
---------------------------------------------------------------------------
    \3\ All references to the bill are to the version introduced on May 
20, 1999, headed TOM99.310, as downloaded from www.senate.gov/epw/ on 
May 21, 1999.
---------------------------------------------------------------------------
I. Money Matters: Declining Authorizations Will Retard Cleanups
    Far from assuring that additional resources will be available so 
that EPA can accelerate or even maintain the rate of cleanup 
completions while meeting the new demands imposed by S. 1090, \4\ the 
bill does precisely the opposite: it sharply ratchets down 
authorizations, beginning with fiscal year 2000 [SPCA Sec. 401 (a), 
amending CERCLA Sec. 111(h), p.98]. The exact degree of reduction is 
difficult to ascertain, because the bill creates new categories for 
various kinds of expenditures. Nonetheless, it is clear that the amount 
of funding authorized for fiscal year 2000 is substantially below that 
actually appropriated for fiscal year 1999. In addition, authorizations 
decline by another $100 million by 2004 (and inflation will reduce the 
real-dollar values even further).
---------------------------------------------------------------------------
    \4\ These include conducting allocations at hundreds of sites [SPCA 
Sec. 303(a), adding CERCLA Sec. 122(n), p.76]; revising the National 
Priorities List to address the ``parcelization'' problem for contiguous 
properties [SPCA Sec. 102(b), adding CERCLA Sec. 105(h), p. 181; and 
reviewing the CERCLIS data base of potentially contaminated sites 
within 2 years to determine which sites should be listed as NPL sites 
[SPCA Sec. 202, amending CERCLA Sec. 105(b)(1), p.381.
---------------------------------------------------------------------------
    Ratcheting down authorizations at this point in the Superfund 
program is insupportable. There is no basis for believing that EPA will 
need less money to conduct cleanups in the next five fiscal years than 
it does in this one. While construction is complete for about 600 
Superfund sites, \5\ there are another 700 sites still to be completed. 
\6\ It is my understanding from informal discussions with EPA staff 
that the agency expects to continue construction-completions at the 
same pace for the next 5 years, namely about 85 per year--unless, of 
course, funds are curtailed.
---------------------------------------------------------------------------
    \5\ There had been 599 construction completions as of 4123199. See 
http://www.epa.gov/superfund/sites/npl/nplfin.htm (as of 5/21/99).
    \6\ As of May 18, 1999, there were 1211 sites on the National 
Priorities List of Superfund Sites, with several dozen additional 
proposed sites. See http://www.epa.gov/superfund/sites/npl/nplfin.htm 
(as of 5/21/99).
---------------------------------------------------------------------------
    For years, critics of the Superfund program have bemoaned the slow 
pace of cleanups. Now that progress is faster, \7\ the sponsors of this 
bill propose to curtail sharply the availability of the resources 
needed to sustain that progress. As a result, communities that have 
long awaited completion of nearby Superfund cleanups will have to wait 
longer still.
---------------------------------------------------------------------------
    \7\ The faster rate of progress is a silver lining with some 
serious clouds on the horizon. Anecdotal reports suggest that EPA's 
eagerness to achieve a faster rate of construction completions has 
prompted the agency to rely heavily--unduly so--on containment-based 
rather than treatment-based remedies. Indeed, it is our understanding 
that only about 30 percent of current remedies involve treatment. While 
treatment options are not always available, they are strongly 
preferable where they are feasible, since containment remedies threaten 
health and the environment if monitoring and maintenance is allowed to 
lapse. Moreover, containment remedies inevitably hamper communities' 
flexibility to change land use over time as community needs change, 
since the containment restrictions must continue to be observed.
---------------------------------------------------------------------------
    This makes no sense.
    Moreover, while it is true that there are fewer sites in 
Superfund's pipeline overall for future cleanup than was recently the 
case, the bill simply ignores the fact that--correspondingly--there are 
more sites now in the operation and maintenance phase. A recent article 
by Dr. Joel Hirshhorn (copy appended) points out that EPA to date has 
done a miserable job in conducting the statutorily required 5-year 
reviews of sites at which some contaminants are left in place. \8\ Only 
by this kind of active oversight can we possibly hope to know if 
remedies are working, and to have advance warning where they aren't.
---------------------------------------------------------------------------
    \8\ Hirshhorn, ``EPA's Five-Year Review of Superfund Sites Needs 
Higher Priority,'' Environment Reporter, Vol. 29, No. 42 (Feb. 26, 
1999). Dr. Hirshhorn has had extensive hands-on experience with the 
Superfund program through many years of service as a Technical Adviser 
to communities and was previously with the Office of Technology 
Assessment.
---------------------------------------------------------------------------
    In other words, even if EPA were to need fewer resources for 
construction-completions over the next 5 years--an assumption that is 
by no means warranted--the agency will clearly need more resources to 
conduct 5-year reviews, and to take followup action where needed.
    It is no secret that the authors of this bill view cleanup of 
highly contaminated hazardous waste dumps as a State responsibility, 
not a Federal one, and are moving to dump cleanups back on the States--
regardless of whether all States have, and will continue to have, the 
resources and inclination to clean up highly contaminated sites. In our 
view, this approach elevates theoretical federalism over protection of 
health and the environment, and we oppose it strongly. Dumping 
Superfund responsibilities on States that may currently or in the 
future lack the resources or aptitude to provide effective cleanups is 
as unconscionable as dumping wastes into the environment in the first 
place.
    Moreover, down-sloping authorizations are unnecessary. 
Authorizations provide a ceiling, not a floor. If it turns out during 
the next 5 years that fewer funds are needed than were authorized, the 
Appropriations Committee will be able to make mid-course corrections. 
As programs seldom receive the full amount of appropriations that are 
authorized, this is hardly a-revolutionary concept.
II. Money Matters, Part 2: Preferential Treatment for Liability Relief 
        over Cleanups
    To add insult to injury, S.1090 provides that funds for liability 
relief get preferential treatment and that inability to finance 
liability relief at a site limits EPA's ability to order additional 
cleanup at that site [SPCA Sec. 303(a), adding CERCLA 
Sec. 122(o)(4)(B), p.80 and (p)(2)(B), p.82]. Specifically, liability-
relief funds tap the remaining balance in the Trust Fund from the 
accumulated reserves of the now-expired taxes, while funds for cleanups 
come from general revenues [SPCA Sec. 401 (a), amending CERCLA 
Sec. 111(a) p.90 and Sec. 111 (h), p.98].
    Moreover, while EPA is obliged to spend funds reimbursing polluters 
for all costs attributable to a party whose liability is limited [SPCA 
Sec. 303(a), adding CERCLA Sec. 122(p)(2)(J)(ii), p.88], there is no 
corresponding obligation to spend one thin dime on actual cleanups. And 
because there is no ``fireball'' between funds for paybacks and funds 
for cleanups, all of the moneys in the Superfund could be exhausted on 
liability-relief funds, leaving none for actual cleanups, oversight, 
and enforcement by EPA, as well as vitiating programs for Technical 
Assistance Grants.
    Finally, S.1090 contains extremely confusing language that could 
readily be interpreted to require EPA to reimburse polluters for work 
they have already agreed to do--an unwarranted windfall. Specifically, 
the bill provides that a ``judicially approved consent decree or 
settlement shall identify the total statutory orphan share owing for a 
facility'' if the decree or settlement covers the last stages of the 
cleanup [SPCA Sec. 303(a), adding CERCLA Sec. 122(o)(4), p. 80 (italics 
added)].
    During discussions with majority staff, we were told that it is not 
the sponsors' intent to re-open any existing settlements. We concur 
that this bill should let ``bygones be bygones'' for both fiscal and 
practical reasons, as generally occurs in new legislation. However, we 
are far from convinced that the language now in the bill achieves that 
objective. To the contrary, the use of the words ``total'' and 
``facility'' suggest that before the final settlement, EPA must go 
back, determine how much the statutory orphan share would have been for 
all the other stages of the cleanup, and deduct that from the amounts 
owed by the polluters in the final settlement. This approach would be a 
logistical nightmare, as well as a huge drain on program resources. It 
is imperative that this language be clarified to avoid such an outcome.
III. A Cure Worse than the Disease: How the Allocation System Will 
        Degrade the Quality and Pace of Cleanups
    Although a fair-share allocation system sounds innocuous, the 
approach taken in S. 1090 is likely to result in a dramatic curtailment 
in the pace of cleanup progress--and in the quality of cleanups as 
well. This somewhat counter-intuitive result will occur for the 
following reasons.
    Most overtly, the bill expressly bars issuance of cleanup orders 
where EPA cannot pay the orphan share when required to do so [SPCA 
Sec. 303, adding CERCLA Sec. 122(p)(2)(B), p.82]. In other words, if 
liability-relief funds run short, cleanups can't be completed. This 
approach is simply unacceptable. There is nothing ``fair share'' about 
a system that holds completion of cleanups hostage to the availability 
of liability-relief funds--it just punishes communities that have 
waited completion of cleanups for far too long already.
    Moreover, by replacing joint and several liability with a ``fair 
share'' system, and simultaneously cutting the authorization, the bill 
leaves the agency with a Hobson's choice among three unappealing 
alternatives: (i) EPA can pay for cleanups itself--until it runs out of 
funding for that year; (ii) EPA can enter into consent decrees for 
cleanups--giving polluters leverage to insist on cheaper, containment-
based remedies rather than treatment-based remedies that offer superior 
long-term protection but have a higher initial price-tag, or (iii) EPA 
can issue unilateral administrative orders to polluters that require 
them to carry out a cleanup--but the prior experience suggests that 
unwilling parties do a poor job, require extensive oversight, and drag 
their heels. None of these approaches achieves environmentally sound 
outcomes.
    In addition, S.1090 could substantially delay cleanups for which no 
final settlement has yet been adopted. Under the bill, a party's 
statutory orphan share must be estimated before a settlement can be 
adopted [SPCA Sec. 303(a), adding CERCLA Sec. 122(p)(2)(K), p.89]. It 
is not at all clear how these estimates are to relate to the 
allocations required under section 122(n) (as added by SPCA 
Sec. 303(a), p.76). If the estimate must be based on the allocation, 
substantial delays will arise. This is because the allocation itself 
will take quite a while, particularly for sites with a large number of 
parties. Each party will have to be contacted (including any de minimis 
parties or others who have long since received settlements), and 
directed to gather and submit their records (which is certain to raise 
the ire of parties who have already entered into settlements). That 
information will have to be evaluated and the allocation prepared. 
Moreover, polluters will have an incentive to identify as many 
additional potential parties as feasible, in the hopes of lowering 
their own allocated share, despite the added workload for those parties 
in gathering their records.
    If it is not intended that the estimate be based on a 122(n) 
allocation, that should be made clear in the text. (While this would 
alleviate some of the pace concerns, it by no means obviates them, as 
EPA-will still have to conduct a large number of complex allocations--
diverting its limited resources from cleanups.)
    None of these evils are necessary ones. If Congress wants to assure 
that EPA will help cover the costs of entities who can't or shouldn't 
be sued--as the agency has been doing with considerable success for the 
last few years--it can designate a pot of funds for that exclusive 
purpose. \9\ At this juncture, a statutory allocation system is a 
solution in search of a problem, and one that will create innumerable 
problems in itself.
---------------------------------------------------------------------------
    \9\ However, such funds should not have priority over cleanup 
funds, nor compete directly with them.
---------------------------------------------------------------------------
              ii. cutting holes in the federal safety net
A. Limits on Superband Authorities at State Cleanup Sites
    The public needs and deserves an effective Federal fallback, or 
safety net, where States fail to carry out their environmental 
responsibilities appropriately for toxic site cleanups, just as occurs 
for air and water pollution programs. Yet, with certain exceptions, 
S.1090 bars EPA from ordering cleanups, and from recovering cleanup 
costs, for releases that are ``within the scope of a response action 
that is being conducted or has been completed under State law'' [SPCA 
Sec. 201 (b), adding CERCLA Sec. 1 28(c)]
    Remarkably, there are no criteria at all for these prohibitions. 
They apply--regardless of whether there has been any public 
participation whatsoever in -development of that State response action,
    --regardless of whether that action will be protective,
    --regardless of whether citizens have judicial review for 
unprotective cleanups,
    --regardless of whether the State response plan is actually being 
complied with, and even regardless of whether the State has the legal 
or practical capacity to enforce the action.
    Once a State response action exists, EPA is barred from ordering a 
cleanup or recovering cleanup costs, even where a site presents an 
imminent and substantial endangerment to health or the environment 
(save by using the Fund's increasingly limited resources, without cost-
recovery).
    Moreover, there are no substantive standards whatsoever for State 
cleanups. Unless a State opts to establish regulations, each site's 
plan will be issued an ad hoc basis with no baseline standards to 
assure the safety or adequacy of cleanups, meaningful public 
participation, judicial review, or any other safeguard. Tens or 
hundreds of thousands of sites may be dealt with on an ad-hoc basis, 
making effective public oversight completely impossible--even apart 
from the fact that the bill makes no provisions for community technical 
assistance. And meanwhile, use of Superfund's authorities at these 
sites are limited.
    We recognize that the bill provides certain exemptions that allow 
EPA to issue cleanup orders and recover costs. These include a request 
from the State, or EPA's finding of interstate pollution. In addition, 
EPA may act upon determining that the State isn't taking appropriate 
action and the situation presents ``a public health or environmental 
emergency'' for an ongoing cleanup. For already-completed responses, 
the standard is ``substantial risk'' as evidenced by new information, 
fraud, or failure of the remedy where there is a clear threat of 
exposure [SPCA Sec. 201 (b), adding CERCLA Sec. 1 28(c)(3)(B).] In 
other words, EPA cannot come in, even where the remedy isn't working, 
unless the agency can show a clear threat of exposure.
    This approach is the antithesis of prevention. It creates different 
legal standards, and provides ammunition for polluters to argue that 
they should be exempt from cleanup or payment obligations based on 
supposed lack of clear exposure, or on the ground that the State wasn't 
really unwilling to act, or that there wasn't an ``emergency.''
    We strongly oppose these limits on Superfund authority. While 
carefully crafted liability relief for prospective purchasers may well 
be desirable (assuming community participation rights are assured), 
limiting Superfund authorities for a large but amorphous range of sites 
is indefensible. Such limitations are also unnecessary: the private 
market is increasingly providing mechanisms for moving forward 
brownfield redevelopment today, with Superfund in place. \10\
---------------------------------------------------------------------------
    \10\ Conferences with titles such as Getting Contaminated Property 
Deals Done,'' proclaiming that ``we will excite you with brownfield and 
financial success stories'' are increasingly common. [Flier for RTM 
Communications conference, April 6-7 1999, Washington, DC]
---------------------------------------------------------------------------
B. Silent Vetoes through Gubernatorial Inertia
    In another highly objectionable feature of the bill, new sites can 
be added to the Superfund list only upon the written request of the 
Governor of the State in which the sites is located [SPCA Sec. 202, 
adding CERCLA Sec. 105(b)(3), p.38]. (S.1090 is even more extreme than 
its predecessor bills, which required concurrence rather than an 
affirmative request.)
    While it may be appropriate to give States ``first dibs'' on 
cleanups at sites that will be appropriately addressed through State 
action, this provision goes much too far. A State could, through simple 
inaction, bar action under Superfund even though the site will not 
otherwise be cleaned up. The State need not even give any reasons for 
failing to submit a request, inviting potential abuses (if, for 
example, a major potentially responsible party at the site also 
happened to be a campaign contributor to a high-ranking State 
official). EPA should defer to a State only upon affirmatively 
determining that the State will conduct an adequate, timely cleanup 
absent the listing or 106 order.
C. The NPL Cap: Dumping Cleanups on Communities and States
    Yet another serious problem is the bill's inclusion of an arbitrary 
cap on the number of additional sites that can be added to the National 
Priorities List. Under S.1090, EPA cannot add more than 30 sites 
annually until 2004 [SPCA Sec. 202, adding CERCLA Sec. 105(b)(2), 
p.37]. A cap has profound consequences because, unless a site is 
listed, EPA cannot undertake cleanup activities (other than a short-
term, low-cost emergency removal). In effect, this provision dumps the 
problem of Superfund site cleanups into the laps of the States--
regardless of whether they have the resources or capacity to conduct 
those cleanups.
    Late last year, the General Accounting Office reported that more 
than half of the 44 State officials interviewed said that their ability 
to fund cleanups is poor or very poor. \11\ The same report concluded 
that, for about 1,800 sites potentially eligible for Superfund listing, 
it was unclear how more than half would be handled, while States and 
EPA said that about 13 percent may be listed on Superfund--but with 
little overlap as to which ones.
---------------------------------------------------------------------------
    \11\ U.S. General Accounting Office, Unaddressed Risks at Many 
Potential Superfund Sites. GAO/RCED-99-8, . November 1998.
---------------------------------------------------------------------------
    Earlier, the GAO had reported that a cap could force States to 
accept responsibility for 1,400 to 2,300 sites (1,100 already 
identified by EPA, along with an estimated 300-1,200 yet-undiscovered 
sites). \12\ The estimated cleanup costs range from $8.4 to $19.9 
billion.
---------------------------------------------------------------------------
    \12\ U.S. General Accounting Office, Impact on States of Capping 
Superfund Sites. GAO/ACED-106R. March 1996. As the 1998 report does not 
refer to the 1996 report, it is not entirely clear how GAO would view 
the relationship between these two sets of findings.
---------------------------------------------------------------------------
    The GAO report makes painfully clear that the States are in no 
position to take on this added burden. Indeed, States are having 
difficulty securing resources for their current cleanup efforts. Of the 
States surveyed by GAO,
    ``three of the seven States with active programs said that taking 
on these additional cleanups would exacerbate an already difficult 
financial situation. Two other States said that they expect to face 
funding shortfalls beginning in fiscal year 1997 that will make it 
difficult to absorb the additional cleanup responsibilities, at least 
for a few years subsequent to that time. Another two States said that 
while they had sufficient funds to manage their own inventories, 
funding the additional cleanups would be difficult.'' \13\
---------------------------------------------------------------------------
    \13\ Ibid., p.2.
---------------------------------------------------------------------------
    Thus, there is no basis for capping the number of sites that EPA 
may add to the National Priorities list.
    This provision also undercuts two of the valuable incentives 
created by Superfund: that which prompts voluntary cleanup of non-NPL 
sites in order to avoid a potential future NPL listing, and that which 
prompts careful management of wastes generated now.
    GAO noted that State program managers ``pointed out that a major 
incentive for private parties to clean up sites is to avoid having 
their properties added to the list of the most contaminated sites in 
the country.'' \14\ In short, a cap on the number of Superfund sites 
may have the perverse effect of creating a greater need for more 
Superfund listings, by reducing incentives for non-Superfund voluntary 
cleanups.
---------------------------------------------------------------------------
    \14\ Ibid., p.3.
---------------------------------------------------------------------------
    The NPL cap will also undercut incentives for sound prospective 
waste management. Facilities will be able to gamble that States will 
lack, or forego use of, cleanup enforcement authorities for tackling 
sites created after the NPL list is effectively closed. The continuing 
nominal availability of litigation authorities under Sec. 107 is far 
from an adequate substitute, given that Sec. 107 suits can only be 
brought to recoup expenditures--thus requiring cash-strapped States to 
front all the cleanup money.
    Where they are unable to do so, today's polluters will evade 
cleanup responsibilities, and sites will remain unaddressed.
    In short, the cap should be eliminated. As a matter of sound 
science and good public policy, EPA should be able to list however many 
sites need listing.
    IV. Liability Provisions.
    There is no dispute that Superfund's existing liability system has 
often been abused by polluters that have filed massive contribution 
actions against entities with minimal or no connection to the site. 
Curbing these abuses is necessary, but does not necessarily require 
legislation, since EPA routinely provides contribution protection to 
settling parties.
    EDF does not oppose carefully crafted provisions that would bar 
abuses of the liability system for small parties that won't, as a 
practical matter, end up putting much money into a cleanup. Even though 
such parties may theoretically qualify as polluters, Superfund's 
liability system is and should be pragmatic: it's a way of getting 
resources to pay for cleanups from the parties most closely associated 
with the site. It simply isn't efficient for litigation to involve 
parties who sent only trivial quantities, or who sent wastes that don't 
affect cleanup costs, or who clearly won't be able to put more than a 
token amount into a cleanup.
    If statutory liability relief is to be provided to such parties, as 
it is under S.1090, we believe it is imperative to have an appropriate 
``pull-back'' provision. We believe the pull-back contained in S.1090 
is appropriately crafted. That set of provisions addresses whether the 
wastes in question ``contributed significantly'' to response costs 
(e.g., [SPCA Sec. 301 (b), adding CERCLA Sec. Sec. 107(r)(2) and 
(s)(2), p.46]. The bill's liability-relief provisions provide rough 
rules of thumb for parties it probably doesn't make sense to sue, but 
they are just that--rough. The pull-back assures that when it really 
matters, the liability provisions won't force an anomalous result. For 
example, if the one drum that a party sent to a site was full of 
dioxin, that party should not be exempted from liability under the de 
micromis limitations. Likewise, if a party qualifies for the small-
business exemption (which as discussed below is unduly broad) but was a 
primary actor in the events leading to creation of the site, it will be 
appropriate to take a hard look at the business to determine just what 
its ability-to-pay really is.
    With regard to the small business limitation itself, while we do 
not necessarily oppose curtailing liability for truly small businesses 
with a limited connection to a site who have limited ability-to-pay in 
any event, the current exemption is ill-crafted. First, the $3 million 
annual-revenue threshold is simply too high [SPCA Sec. 301(b), adding 
CERCLA 107(s)(1), p.45]. Moreover, the exemption applies to companies 
with either fewer than 75 employees, or less than $3 million gross 
revenues. This potentially exempts wealthy corporations that happen to 
have relatively few employees (and 75 is a significant number of 
employees in any event). If a small-business exemption is to be 
adopted, it should use narrower thresholds, and should require meeting 
criteria for both numbers of employees and gross revenues.
    Conclusion.
    Thank you for this opportunity to present our views. We would 
welcome an opportunity to work with the committee in crafting a 
Superfund bill that reinstates the taxes, adopts narrowly drawn 
liability-relief provisions to make the liability system operate more 
effectively, and preserves the basic structure of this important 
statute.
                                 ______
                                 
                         Analysis & Perspective
                        superfund site remedies
    Congress created the requirement for 5-year reviews of Superfund 
site remedies chosen by the Environmental Protection Agency that leave 
hazardous contaminants at sites because of a concern that impermanent 
remedies require long-term attention and may not remain protective of 
human health and the environment. The requirement has not acted as a 
disincentive to lower-cost remedies that leave contaminants at sites. 
Instead, EPA has largely given the effort a low priority. The 5-year 
review program has been highly criticized in two independent government 
studies, mainly because EPA was not giving reviews high enough priority 
to avoid a backlog, even though the reviews were useful.
    EPA's Five-Year Review of Superfund Sites Needs Higher Priority
                     (By Joel S. Hirschhorn, Ph.D.)
Introduction
    Interestingly, the Superfund's 5-year review activity has received 
relatively little attention, despite Superfund being one of the most 
studied environment programs. The public interest and environmental 
community has never focused on the reviews as a means of obtaining 
better long-term protection of human health and the environment. Two 
government agencies that have examined the Superfund 5-year review 
program have been very critical of it, although they also noted how 
some reviews identified problems and deficiencies in cleanups.
    Joel S. Hirschhorn was a senior associate at the Congressional 
Office of Technology Assessment for many years, where he produced many 
nationally recognized studies of the Superfund program and participated 
in the drafting of the Superfund Amendments and Reauthorization Act, 
Resource Conservation and Recovery Act amendments, and the Pollution 
Prevention Act. He is now president of Hirschhorn & Associates, 
Wheaton, Maryland, providing consulting services to a variety of 
clients on Superfund and other types of site cleanups and hazardous 
waste issues. He is also editor of Remediation: The Journal of 
Environmental Cleanup Costs, Technologies & Techniques, published by 
John Wiley.
    In its guidance to regional offices, EPA has said that the main 
purpose of reviews is ``to determine whether: the remedy remains 
protective of human health and the environment; is functioning as 
designed; and necessary operation and maintenance is being performed.'' 
A loss of protectiveness could result from failures of technology, 
ineffective monitoring, poor operation and maintenance activities, 
changing site conditions and poor implementation of institutional 
controls. This paper examines how EPA has implemented the statutory 
requirement for 5-year reviews and also identifies some policy options 
to improve the program.
EPA Is Required to Conduct Reviews
    In the 1986 amendments to the Federal Superfund statute, Congress 
mandated that EPA conduct 5-year reviews for remedial cleanups. The 
amendments generally placed a priority on Superfund cleanups achieving 
permanent remedies based as much as possible on using treatment 
technologies, in contrast to containment and institutional control 
remedies which left hazardous substances at sites and necessitated 
restrictions on using land or ground water. The 5-year review 
requirement was devised as a safeguard for those remedies that were not 
permanent, because they left hazardous substances on the original sites 
and required periodic verification that the cleanups were continuing to 
protect human health and the environment. It was realized that a lot 
could go wrong with cleanups dependent on: containment of wastes; 
systems that had to operate for many years, well-enforced institutional 
controls, such as land use restrictions. or natural attenuation 
remedies requiring many years of monitoring.
    Subsequently, in 1990, EPA finalized the National Contingency Plan 
(NCP) as a set of regulations governing the Superfund program, and it 
included some specific language on the requirement for 5-year reviews. 
It is important to see the exact language in the law and the 
regulations and to understand subtle but important differences in the 
language used.
    The key language in Section 121(c) of the Comprehensive 
Environmental Response, Compensation, and Liability Act states:
    ``If the President [EPA] selects a remedial action that results in 
any hazardous substances, pollutants, or contaminants remaining at the 
site, the President [EPA] shall review such remedial action no less 
often than each 5 years after the initiation of such remedial action to 
assure that human health and the environment are being protected by the 
remedial action being implemented.'' [emphasis added]
    The law also said that EPA would have to take any necessary action 
appropriate to assuring protectiveness. Note the use of the word 
``any'' in the above statement, which would seem to indicate a very 
stringent view of the basis for requiring reviews.
    In the subsequent NCP, in Section 300.430(f)(4)(ii), EPA used the 
following language:
    ``If a remedial action is selected that results in hazardous 
substances, pollutants, or contaminants remaining at the site above 
levels that allow for unlimited use and unrestricted exposure, the lead 
agency shall review such action no less often than every 5 years after 
initiation of the selected remedial action.'' [emphasis added]
    In place of the word ``any'' EPA introduced the concept of not 
having unlimited use and unrestricted exposure as a condition 
establishing the need for a 5-year review. This could be seen as a 
softening of the original statutory requirement. That is, some 
hazardous substances, pollutants or contaminants might be left at a 
Superfund site, but if the levels were such that there were no 
restrictions on use or exposure, then reviews would not be required. In 
fairness, one could argue, of course, that it is impossible to remove 
absolutely every atom or molecule of hazardous substance from a 
Superfund site and, therefore, that the original statutory language was 
impractical because it implied leaving absolutely no amount of 
contaminants in order to avoid the review requirement.
Pragmatic Interpretation Not Challenged in Court
    This more pragmatic NCP interpretation apparently has never been 
challenged in court. One potential problem of course is that risk 
assessments and cleanup standards could be changed over time so as to 
change or remove original restrictions, and doing so could then remove 
the requirement for future 5-year reviews. The NCP also clarified that 
all Records of Decision (RODs) had to clearly state whether 5-year 
reviews were necessary.
    In the preamble to the NCP, EPA also said the following: ``EPA 
agrees that the review should in general focus on monitoring data, 
where available, to evaluate whether the remedy continues to provide 
adequate protection of human health and environment. New technologies 
will be considered where the existing remedy is not protective, but the 
5-year review is not intended as an opportunity to consider an 
alternative to a protective remedy that was initially selected.''
    In this statement one sees an important EPA perspective that may 
have importance for seeing the limitations of reviews where technology 
change is an issue. That is, EPA seems to believe that an original 
technical approach must be implemented and found nonprotective, rather 
than considering as part of a review some newer technology, for 
example, to replace a part of an original remedy that may not have been 
fully implemented. In contrast, EPA has a remedy update program as part 
of its Superfund reforms that is aimed at changing remedies because of 
new science or technology if costs can be reduced. However, EPA's 1996 
guidance to regions on conducting remedy updates did not consider how 
such actions related to 5-year reviews. Nevertheless, according to 
EPA's latest summary report for updating remedy decisions, with the 
exceptions of Regions I and V, regional offices have indicated in their 
plans for implementing the remedy decision reform effort that 5-year 
reviews serve as a mechanism for considering remedy changes. This 
contrasts to seeing them as only a means to fix original remedies.
    A recently announced Federal court decision in Puerto Rico supports 
the need for EPA to take the statutory requirement for 5-year reviews 
quite seriously (M.R. (Vega Alta) Inc. v. Caribe General Electric 
Products, D.P.R., No. 97-2294, 12/3/98). For a Superfund site in Puerto 
Rico, a group seeks to require EPA to perform such a review of an 
ongoing cleanup. The U.S. District Court for the District of Puerto 
Rico agreed to hear the suit and rejected a government motion to 
dismiss. The court found that the request to order the review is not a 
challenge to the response action, and said that the review ``would not 
affect the remedial action or unduly compromise the EPA's limited 
resources.''
EPA's Guidance to Regions
    EPA headquarters has issued guidance for regional offices, although 
regions are always free to disregard the guidance on the basis of site-
specific circumstances. The guidance clearly said that examining 
whether a cleanup remained protective meant, for example, if the remedy 
depended on containment with a cap, examining whether the cap was still 
effective; if the remedy depended on institutional controls whether 
they remained in place; and if the remedy included ground water 
collection and treatment, whether such a system was performing as 
predicted. The main guidance was issued in 1991, after finalization of 
the NCP and just in time to handle the first required reviews, and it 
set the structure of three distinct levels of reviews, differing mainly 
in the scope of review activities. \1\ It was contemplated that the 
simplest Level I review would be appropriate in all but a relatively 
few cases. Only Level II and III reviews included sampling for getting 
new data to confirm existing remedy protectiveness. The guidance also 
established two main types of reviews: statutory and policy.
---------------------------------------------------------------------------
    \1\ EPA, ``Structure and Components of Five-Year Reviews,'' May 23, 
1991, OSWER Directive 9355.7-02.
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    The statutory sites are those with Records of Decision issued after 
the Superfund statute was amended in 1986 to create the requirement for 
the-reviews. Statutory reviews apply to National Priorities List sites, 
construction complete sites, and sites delisted from the NPL. Policy or 
discretionary reviews are for sites that, strictly speaking, did not 
legally require reviews but which EPA decided should receive them, 
including sites with remedies conducted prior to 1986. From a risk 
perspective, of course, both types of sites pose equal needs for 
reviews because of hazardous materials left on the site. If anything, 
one might even argue that pre-1986 sites might be of lower quality than 
later sites, simply because of less experience with Superfund cleanups.
    Subsequent supplemental guidance in 1994 was designed to provide a 
fourth, even simpler, streamlined and lower-cost review, termed Level 
la, appropriate for sites where remedial construction was ongoing. \2\ 
For example, EPA estimated that 160 to 170 hours were necessary for a 
Level I review, but only 30 to 40 hours for a Level la review. Nearly 
30 percent of reviews seem to be Level la type. It appeared that the 
creation of the Level la reviews was in response to growing criticism, 
including by the EPA Inspector General, about the backlog of reviews. 
By reducing the scope and cost of many reviews the logic was that EPA 
regional offices would be able to conduct more reviews. This guidance 
also clarified that reviews were to cover the entire site and all 
operable units or multiple remedies. However, none of the EPA guidance 
seems to address the tough issue of deciding whether a declaration of 
protectiveness or the lack of it requires the same condition for all 
parts of a remedy. This supplemental guidance also established 
priorities, with the first priority being all statutory reviews, the 
second priority being policy reviews where the lead agency has 
completed remedial action--and is no longer onsite, and the third 
priority being all remaining policy sites. Interestingly, an Office of 
Inspector General audit (discussed below) found some inappropriate uses 
of the Level la review and ones where problems with the cleanup were 
not identified.
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    \2\ EPA, ``Supplemental Five-Year Review Guidance,'' July 26 1994, 
OSWER Directive 9355.7-02A.
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Second Supplemental Guidance Issued
    A second supplemental guidance was issued in late 1995. \3\ It 
explicitly said that it was a response to an Office of Inspector 
General (OIG) audit of the review program (discussed below). In the 
interest of performing more reviews with limited resources, EPA 
headquarters encouraged its regional offices to use ``potentially 
responsible parties (PRPs) to provide information for 5-year reviews.'' 
There was no direct attention to or discussion of the obvious issue of 
a conflict of interest for PRPs who might lack the objectivity to 
identify problems with remedies that they had conceived, implemented, 
and paid for. The guidance clarified that regional officials would have 
to clearly state whether the remedy is protective, is not protective, 
or if it would be protective if certain measures were taken. The 
guidance also stressed that if a remedy was determined to lack 
protectiveness, then regional offices should present recommendations 
for actions, milestones toward achieving protectiveness with clear 
timetables, and should also state which agency has oversight 
responsibility to ensure that the necessary measures are completed. 
This guidance also clarified that ``A Type II or Type III review should 
be employed only when site-specific circumstances indicate a need for a 
recalculation of the risk, or a new risk assessment, respectively.''
---------------------------------------------------------------------------
    \3\ EPA, ``Second Supplemental Five-Year Review Guidance,'' Dec. 
21, 1995, OSWER Directive 9355.7-03A.
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    What merits more attention is the issue of different possible views 
about the most fundamental finding that a 5-year review is supposed to 
explicitly present as a declaration in the report: about the presence 
or absence of protectiveness. There is a need for improved EPA guidance 
that addresses the criteria that regional offices should use when 
reaching their decision about protectiveness. None of the existing EPA 
guidance actually presents specific, detailed clear criteria by which 
reviewers could decide what the declaration should be. For example, if 
some required part of a remedy (such as a monitoring well) is simply 
not functioning or being performed as designed or planned, is that 
alone sufficient to issue a declaration that protectiveness is lacking? 
Or, is it necessary for the review to document some uncontrolled 
releases of hazardous substances, or to document some actual 
unacceptable exposure necessary for a declaration of a lack of 
protectiveness? If only one operable unit is not functioning entirely 
as designed or planned but the remainder of the remedy is all right, is 
that situation sufficient to declare that protectiveness is lacking? 
The goal of improved EPA guidance should be to remove any ambiguities 
about the key decision process regarding protectiveness with regard to 
any and all conditions that justify a declaration that protectiveness 
is lacking at the time of the review.
    This author has been told that EPA headquarters in consultation 
with regional offices has been developing new guidance for the reviews 
that may be released in summer 1999.
    EPA headquarters issues many guidance documents for the Superfund 
program and some of these have some connection to 5-year reviews, but 
often they do not refer to them. However, the guidance on how land use 
is considered in making remedy decisions also included reference to 5-
year reviews. \4\ Under the heading ``Future Changes in Land Use'' the 
directive said: ``Where waste is left onsite at levels that would 
require limited use and restricted exposure, EPA will conduct reviews 
at least every 5 years to monitor the site for any changes. Such 
reviews should analyze the implementation and effectiveness of 
institutional controls with the same degree of care as other parts of 
the remedy. Should land use change, it will be necessary to evaluate 
the implications of that change for the selected remedy, and whether 
the remedy remains protective.''
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    \4\ EPA, ``Land Use in the CERCLA Remedy Selection Process,'' May 
25, 1995, OSWER Directive 9355.7-04.
---------------------------------------------------------------------------
    The issue for conduct of the reviews is whether there is a 
sufficient effort to identify problems with institutional controls. 
Many institutional controls could be difficult to fully and fairly 
evaluate, particularly the extent to which they are implemented as 
originally planned. EPA's guidance documents do not provide explicit 
details on the extent to which some failure of institutional controls 
may constitute sufficient basis for declaring a lack of protectiveness 
for a remedy.
Studies of EPA's Program
    In early 1995 EPA's Office of Inspector General completed its 
independent audit of the 5-year review program. \5\ It found a 
substantial backlog of 5-year reviews existed because EPA managers had 
not given them a high priority. As is normally done, the audit covered 
only a sample of three of the ten EPA regions. It reported that at the 
end of fiscal year 1994 only 30 percent of the NPL Superfund sites that 
were supposed to have received statutory and policy reviews had 
received them. The report concluded that the backlog was generally 
caused by the low priority management placed on the reviews and it was 
noted that EPA officials who were interviewed often ``appeared to view 
the 5-year reviews as a nuisance, and gave the impression that the 
reports had little or no value. . . . It was apparent from our 
interviews that regional officials did not believe the 5-year reviews 
were important.'' The audit also found problems in the quality of 
reviews, including ones that did not follow EPA guidance.
---------------------------------------------------------------------------
    \5\ EPA, Office of Inspector General, ``Backlog Warrants Higher 
Priority for Five-Year Reviews,'' Audit Report, March 24,1995.
---------------------------------------------------------------------------
    On the positive side, the OIG audit found that the ``reviews were 
valuable tools to identify successful remedies or those remedies that 
have developed problems or have failed.'' This clearly made EPA's 
backlog significant. In one case, a site visit found that required 
surface water sampling had not been conducted for years and that a 
landfill cover had been damaged. The reviews were also important for 
checking on Operation & Maintenance (O&M) activities and cited an 
example where a review activity had found a dead animal inside a 
monitoring well that rendered it ineffective. The main recommendation 
was that the Superfund program should give a higher priority to the 
reviews. For the audit's sample of review reports, some 31 percent were 
deemed to lack protectiveness.
    One specific result of the OIG audit was that EPA headquarters 
created a lower cost review and it said that it would take action to 
increase the priority of the reviews. This author has been told that 
the OIG is currently conducting a followup audit of the 5-year review 
program.
    A study by the congressional General Accounting Office of the 
Superfund program also examined the reviews and generally supported the 
findings of the OIG audit. \6\ GAO concluded that ``these reviews have 
often revealed potential and actual problems that the states or 
responsible parties have had to correct. However, the agency has a 
significant backlog of overdue reviews and consequently may be unaware 
of deteriorating conditions at some sites.'' At the time of the GAO 
study there was no clear indication that the backlog problem was being 
solved and GAO said that ``the agency may not be aware of problems that 
may be occurring at other Superfund sites.''
---------------------------------------------------------------------------
    \6\ GAO, ``Superfund Operations and Maintenance Activities Will 
Require Billions of Dollars,'' Sept. 1995.
---------------------------------------------------------------------------
    More specifically, GAO reviewed O&M activities at 57 sites, 
including 43 sites at which 5-year reviews had been performed and at 
three of these GAO conducted case studies. In one case GAO found that 
the EPA review revealed that the site's responsible party had not been 
sampling ground water as was required. The review caused a sampling 
plan to be implemented. At another Superfund site GAO found that a 
review had discovered that no required maintenance had been implemented 
and that trees were growing on the landfill cover, a most serious 
problem. For another site, EPA recommended that the state conduct 
surface water sampling more frequently, because of high contaminant 
levels.
Why Not a High Priority?
    Clearly, both the OIG and GAO studies verified the wisdom of the 
congressional mandate and they identified the paradox of 5-year reviews 
being very useful tools but that EPA was not giving them a high 
priority. The OIG report made a point about the benefit of EPA 
identifying problems with cleanups ``before serious damage occurs or 
they become a public scandal.'' But it seems that EPA Superfund 
managers did not see the reviews in the same positive way. Why? The 
most logical interpretation is that EPA officials in regional offices 
were not motivated to identify problems or deficiencies with ``their'' 
cleanups. Moreover, despite the OIG and GAO reports, there was no 
widespread interest in the subject by environmental or public interest 
groups. EPA's assertions that the backlogs found by the OIG and GAO 
studies were an inevitable consequence of inadequate resources seem 
implausible considering the relatively low costs of conducting reviews, 
nor were they consistent with the attitudes of EPA staff found by the 
OIG audit.
    In 1996 a professional paper was given at a major conference on 
this same subject. \7\ The paper presented a good review of EPA's 
program. Other than informing professionals about EPA's implementation, 
the paper focused on presenting a summary of opportunities for PRPs to 
reduce cleanup costs by participating in the review process. The paper 
noted that PRPs were slated to pay the majority of the many billions of 
dollars for O&M activities at Superfund sites. While concerned citizens 
would likely see reviews as a major opportunity for the government to 
identify deficiencies with cleanups in progress or completed, PRPs 
could see reviews very differently, because they could focus on how 
some O&M activities might be reduced or eliminated. The paper noted 
that ``USEPA recognizes that PRPs may propose additional response 
actions to reduce O&M activities or to contain rising O&M costs.'' The 
paper identified nine specific indicators of opportunities to reduce 
costs. These included, for example, reducing monitoring requirements, 
changing cleanup standards, and changing O&M activities.
---------------------------------------------------------------------------
    \7\ J.L. Pintenich, ``Components, Levels, and Opportunities In The 
Five-Year Review Process,'' Proceedings of Hazwaste World and Superfund 
XVII Conference, Oct. 1996.
---------------------------------------------------------------------------
EPA Conducts Contractor Study of Review Program
    EPA has had its own contractor study of the 5-year review program 
to collect data and perform analysis to help EPA improve its 5-year 
review program. The study was conducted in the summer of 1997 and 
examined 100 first 5-year review reports prepared by all ten EPA 
regional offices. There also were data on the number of first 5-year 
reviews completed by regions versus the number of reviews remaining to 
be completed through fiscal year 2000. Only a small fraction had been 
completed, generally much less than 10 percent. Of the 100 reviews 
studied, 98 percent fit EPA's Level I or Ia and 2 percent were Level 
II; there were none in the Level III category. The Level I and Ia 
reviews are the smallest efforts, Level II is more extensive, and Level 
III even more extensive (as discussed above). The most important 
purpose of a review is to provide a statement whether the site remains 
protective of human health and the environment. The study found that 72 
percent of reviews provided statements that the remedy remained 
protective, 10 percent had information that implied protectiveness, 13 
percent did not have an explicit statement because the remedy was still 
being implemented, 2 percent had no required statement or implicit 
information, and only 2 percent stated that the remedy was not 
protective. One review said that further investigation was necessary to 
determine protectiveness.
    The study also found that 55 percent of reviews made 
recommendations, with the most common types being: improve O&M (30 
percent), upgrade the remedy (16 percent), conduct additional 
evaluation or investigation (13 percent), and repair the remedy (9 
percent). Considering that only 2 percent of the reviews said that the 
remedy had not remained protective, the fact that 25 percent needed 
upgrading or repair is quite interesting, certainly suggesting that the 
reviews had found protectiveness either diminished or in jeopardy. It 
also suggests that EPA regional offices may be very reluctant to 
officially declare that a remedy they originally conceived and approved 
is explicitly declared as not being protective. Interestingly, nearly 
all of these 25 percent resulted from Level I or la reviews, the most 
minimal types of reviews. It might be reasonable to speculate that more 
intensive reviews (Level II or III) could be even more effective in 
identifying problems with remedies, if they were truly objective and 
impartial.
    Importantly, the OIG report that examined 26 review reports from 
Regions III, V and VI found that eight of them, or 31 percent, 
``indicated that the remedies were not protective of human health and 
the environment.'' In addition to 16 reports declaring that the 
remedies were protective, two reports provided no conclusion about 
protectiveness. This result of a 31 percent remedy failure rate is 
quite inconsistent with the contractor study finding that only 2 
percent were not protective. However, the answer may be that the 
combined total of the 25 percent discussed above and the 2 percent 
explicitly declaring remedies non-protective is what should be compared 
to the OIG value of 31 percent, because many review reports 
(particularly older ones) may have to be interpreted as to their basic 
determination about protectiveness. EPA's contractor may have been less 
objective or less willing than the OIG audit to interpret review 
reports as saying that there was a lack of protectiveness.
Comparing EPA's Annual Reporting With Studies
    The Superfund statute also required EPA to report to Congress on 
the 5-year reviews, including ``the results of all such reviews.'' In a 
1989 report EPA said it ``will report annually the results of all 5-
year reviews that were conducted during the preceding 12 month 
period.'' \8\ This author was told by an EPA headquarters official that 
this reporting has been done as part of EPA's annual Superfund reports. 
However, these reports to Congress on the progress of the Superfund 
program seem to have been stopped by EPA several years ago. The three 
most recent Superfund reports are available on the EPA's World Wide Web 
site, with the most recent one being for fiscal 1994. Thus, EPA has not 
fulfilled its commitment to reporting on the 5-year review program for 
4 years (i.e., fiscal 1995 through fiscal 1998).
---------------------------------------------------------------------------
    \8\ EPA, ``A Management Review of the Superfund Program,'' 1989. In 
this report EPA made a commitment that no NPL site would be delisted 
without receiving at least one 5-year review. However, a recent Amended 
ROD for the Munisport Superfund site in Florida explicitly committed to 
delisting and said that no 5-year review was necessary even though the 
limited remedial action had clearly not produced a condition for future 
unrestricted use.
---------------------------------------------------------------------------
    The following information was retrieved from the three reports: in 
fiscal 1991 there was one review (i.e., consistent with first guidance 
in that year), in fiscal 1992 there were three statutory reviews and 
three policy reviews; in fiscal 1993 there were six statutory reviews 
and 1-9 policy ones; in fiscal 1994 there were 15 statutory reviews and 
10 policy ones. Note that in fiscal 1993 out of the 22 statutory 
reviews required in that year only four were conducted, and in fiscal 
1994 out of the 39 required only 10 were conducted. Clearly, statutory 
reviews were not receiving the highest priority, which may explain the 
priority-setting in the 1994 guidance. The fiscal 1992 report did not 
reveal how many reviews were required in that year. The grand total for 
fiscal 1991 through fiscal 1994 was 57 reviews. For fiscal 1993 and 
fiscal 1994 the percent of required reviews actually performed in the 
required years was 23 percent (ices, 14 of 61).
    These data support the conclusions by OIG and GAO concerning a 
backlog of unperformed, required reviews. Also, EPA's 1997 contractor 
study indicated that the 100 first-year reviews examined represented 
only 11 percent of the total of 930 reviews required by fiscal 2000; 
however, it is likely that those 100 reviews represented what was 
accomplished through fiscal 1996, leaving 4 years to accomplish the 
remaining 89 percent. However, considering that only 25 required 
reviews were conducted in the period of fiscal 1991 through fiscal 
1994, and probably 75 more in fiscal 1995 and fiscal 1996, it seems 
that there is still a major backlog of required reviews.
    As to the results of the reviews, the annual reports presented 
minimal information. It was said that nearly all the reviews confirmed 
the protectiveness of the remedies. Although, as discussed above, the 
problem may be a difference between the technical substance in review 
reports versus what is explicitly declared in terms of the presence or 
absence of protectiveness. There was only one description of a review 
finding a problem and addressing it. This was for a site handled in 
fiscal 1992 where the review recommended-development of more 
enforceable deed and land use restrictions, which were subsequently 
implemented. This apparent fraction of one site that may have had a 
determination of nonprotectiveness out of a total of 57 is consistent 
with EPA's contractor study that indicated only two out of 100 site 
with such a negative finding. But it would not be consistent with the 
OIG's finding of some 31 percent lacking protectiveness. It seems fair 
to conclude that EPA's official record of reviews through fiscal 1994 
was not impressive in terms of identifying cleanup problems or 
deficiencies supporting a conclusion of a lack of protectiveness. One 
would expect, of course, EPA to take the position that so few reviews 
find a lack of protectiveness because EPA has done such a good job in 
the first place in conceiving and implementing Superfund cleanups. But 
another possibility is that the reviews lack enough effort or 
objectivity to accurately identify significant problems indicating a 
lack of protectiveness or more likely that they often have not 
explicitly stated a lack of protectiveness, even when the technical 
findings support such a negative declaration.
    It seems fair to conclude that all the available information 
indicates that EPA's 5-year review program is far from a success and a 
very low EPA priority. It should also be noted that over the past 
several years EPA has had a major Superfund reform program consisting 
of many different activities and improvements in the program. However, 
there was no reform aimed at improving the 5-year review effort. This 
is most interesting because of the trend in recent years of increasing 
numbers of Superfund cleanups being dependent on containment and 
institutional controls. Yet most studies of the Superfund program have 
not paid attention to the 5-year review program, even when addressing 
relevant issues, particularly long-term effectiveness of remedies. \9\ 
The lack of attention to the 5-year program by Congress and public 
interest groups means that there is no balancing of the likely inherent 
low interest within regional offices in using reviews to identify 
problems or deficiencies requiring attention and increased spending. In 
theory, the 5-year review program is a critically important quality 
control program for Superfund cleanups. But there is no evidence that 
it has yet functioned in an optimal way. This is not only unfortunate 
for Superfund cleanups, but it has failed to set what might have been a 
positive example for many other cleanup programs in the country, some 
Federal and some state, where there is also increasing use of remedies 
that leave hazardous materials at sites. Perhaps, eventually, more 
citizens in Superfund communities will ask the logical question: ``Is 
this cleanup still working effectively?'' If they do, perhaps then will 
EPA and others start to pay more attention to the 5-year reviews.
---------------------------------------------------------------------------
    \9\ A very good independent study ``Linking Land Use and Superfund 
Cleanups--Uncharted Territory,'' by Resources for the Future (June 
1997), presented considerable evidence of problems with the long-term 
effectiveness of institutional controls at Superfund sites. But even 
this study did not examine the 5-year review program. One of the ideas 
presented in the report was for EPA to create a new office or for a new 
agency to be created ``whose sole responsibility would be long-term 
oversight of contaminated sites.'' It also suggested that the Superfund 
law ``could require EPA to review land use controls at NPL sites every 
3 years (or some relatively short period) and stipulate damages against 
landowners who violate property use restrictions specified in consent 
decrees or in RODs.'' Another study, ``A Remedy for Superfund--
Designing a Better Way of Cleaning Up America,'' Clean Sites (Feb. 
1994), noted the need to ``Establish procedures for long-term control 
and oversight of sites that are remediated to less than residential 
cleanup levels.'' But it did not even mention the 5-year review 
requirement.
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    Lastly, it should be noted that no information found on the 5-year 
review program has indicated any attention to reviews after the initial 
one, and whether regional offices are conducting them in a timely 
manner and what they are finding. Since significant numbers of reviews 
were first conducted in fiscal 1992 and fiscal 1993, followup reviews 
should have already been done at many sites. While it appears that 
there is still a major backlog of first 5-year reviews, it is even more 
likely that there is a larger total backlog when subsequent reviews for 
all sites are considered, including construction complete sites and 
sites delisted from the NPL.
Conclusions
    Because the 1990's have seen a remarkable increase in cleanups 
based on containment, institutional controls, and natural attenuation, 
which leave contaminants at sites, there is a major need for senior EPA 
managers to refocus their plans and strategies for the Superfund 5-year 
review program. Congress was correct in introducing the 5-year review 
requirement into CERCLA in 1986, but they could not have anticipated 
that it would become increasingly necessary as treatment remedies 
became used less frequently. Rather than acting as a kind of 
disincentive for remedies that leave contaminants at sites, 5-year 
reviews have largely been given little priority or visibility.
    Now, Congress should make the 5-year review program a topic to 
consider seriously during Superfund reauthorization. Instead of being 
buried deep within the bureaucracy, the 5-year review program should be 
re-engineered to be the model for all cleanup programs in the United 
States, both Federal and state. There is no indication that EPA 
regional offices have ever seen the intrinsic benefits of a long-term 
quality control program for Superfund cleanups, even though the EPA 
Inspector General's office and the General Accounting Office have 
clearly identified important benefits of 5-year reviews. Claims of 
insufficient resources to conduct 5-year reviews have no credibility.
    The real explanation seems to be a widespread reluctance to 
impartially review Superfund remedies that the regional offices 
themselves have conceived, approved and implemented. Congress should 
consider creating some independent office to conduct 5-year reviews 
with sufficient resources to ensure timely reviews for all Superfund 
sites.
                               __________
 Statement of Mark Gregor, Manager, Division of Environmental Quality, 
                      City of Rochester, New York
Introduction
    Chairman Chafee, and members of the committee, my name is Mark 
Gregor and I am the Manager of the Division of Environmental Quality 
for the City of Rochester, New York. I am here today to testify on 
behalf of the National Association of Local Government Environmental 
Professionals, or ``NALGEP.'' NALGEP appreciates the opportunity to 
present this testimony on the views of local government officials from 
across the Nation on the need for additional Federal Legislative end 
regulatory incentives to promote the cleanup, redevelopment end 
productive reuse of brownfields sites in local communities.
    NALGEP represents local government of finials responsible for 
ensuring environmental compliance, and developing and implementing 
environmental policies and programs. NALGEP's membership consists of 
more than 100 local government entities located throughout the United 
States, and includes environmental managers, solid waste coordinators, 
public works directors and attorneys, all working on behalf of cities, 
towns, counties and municipal associations. Our members include many of 
the leading brownfields communities in the country such as Chicago, 
Portland, Baltimore, Salt Lake City, Los Angeles, Dallas, Cuyahoga 
County and others.
    In 1995, NALGEP initiated a brownfields project to determine local 
government views on national brownfields initiatives such as the EPA 
Brownfields Action Agenda. The NALGEP Brownfields Project culminated in 
a report, entitled Building a Brownfields Partnership from the Ground 
Up: Local Government Views on the Value and Promise of National 
Brownfields Initiatives, which was issued in February, 1997. In 1997, 
NALGEP was invited to testify on brownfields issues and present the 
findings of our report to this committee as well as to the House 
Commerce Committee and the House Transportation and Infrastructure 
Committee.
    During the past 2 years, NALGEP has continued its work on 
brownfields through coordinating work groups of local of finials to 
address the following issues: (1) Brownfields Cleanup Revolving Loan 
Funds; (2) use of Community Development Block Grants for Brownfields; 
(3) building partnerships between business and local government of 
finials to promote smart growth; and (4) implementing the 
Administration's Brownfields Showcase Community initiative. As a result 
of these efforts, NALGEP is well qualified to provide the committee 
with a representative view of how local governments, and their 
environmental and development professionals, believe the Nation must 
move ahead to create long-term success in the revitalization of 
brownfields properties.
    NALGEP's testimony today will focus on the following areas: ( 1 ) 
the continued need for Federal funding to support the cleanup and 
redevelopment of brownfields sites across the country; (2) the need for 
further liability clarification to encourage the private sector to step 
forward and revitalize more sites; and (3) the need to facilitate the 
participation of other Federal agencies (e.g., Army Corps of Engineers, 
Department of Transportation, HUD) in supporting local brownfields 
initiatives.
    The cleanup and revitalization of brownfields represents one of the 
most exciting, and most challenging, environmental and economic 
initiatives in the nation. Brownfields are abandoned, idled, or under-
used industrial and commercial properties where expansion or 
redevelopment is hindered by real or perceived contamination. The 
brownfields challenge faces virtually every community; experts estimate 
that there may be as many as 500,000 brownfields sites throughout the 
country.
    The brownfields issue illustrates the connection among 
environmental, economic and community goals that can be simultaneously 
fostered through a combination of national leadership, Federal and 
State incentives, and the innovation of local and private sector 
leaders. Cleaning up and redeveloping brownfields provides many 
environmental, economic and community benefits including:
    expediting the cleanup of thousands of contaminated sites;
    renewing local economies by stimulating redevelopment, creating 
jobs and enhancing the vitality of communities; and
    limiting sprawl and its associated environmental problems such as 
air pollution, traffic and the development of rapidly disappearing open 
spaces.
                   rochester's brownfields initiative
    During the last 5 years, the City of Rochester, New York has 
completed the redemption of more than 50 acres of brownfields sites 
including the site of Bausch and Lomb's new corporate headquarters, the 
site of a new Federal Aviation Administration funded Aircraft Rescue 
and Fire Fighting facility, and the site of the state-of-the-art 
Rochester/Monroe County ``911'' Center.
    The City of Rochester was selected as one the first round of 
brownfields pilot cities by the U.S. Environmental Protection Agency. 
Rochester was also awarded a Brownfields Cleanup Revolving Loan Fund 
grant from EPA.
    Using the EPA pilot grant funds for investigation and City funding 
for cleanup, Rochester has remediated 15.5 acres that were once 
junkyards, fuel depots, and a rail yard and is now the Erie Canal 
Industrial Park. Rochester is also in the process of establishing a 
site investigation funding program using EPA funding.
    The Federal Government, particularly the U.S. EPA, has played an 
important role in helping Rochester develop and advance our brownfields 
redevelopment efforts. They have provided critical funding to enable us 
to institutionalized local program and to help investigate and clean up 
specific sites. They have provided technical assistance and other 
resources that have helped us learn from other communities and take on 
the many challenging obstacles to brownfields revitalization. They have 
helped connect us with other Federal agencies that have resources and 
technical expertise. And perhaps, most importantly, they have provided 
the critical leadership needed to educate the many stakeholders and the 
general public that redeveloping brownfields can be done and that it 
can provide significant economic and environmental benefits for 
communities across the nation.
    Several barriers, however, continue to hamper brownfields cleanup 
and redevelopment in Rochester and other communities. New Federal 
legislation to further clarify and provide some limits on the liability 
of ``non-responsible'' new owners of brownfields sites that voluntarily 
complete cleanups would be an important stimulus to the reuse of many 
brownfields. Additional Federal funding in the form of grant and loan 
programs continues to be important especially for cities like Rochester 
that have a declining tax base and falling assessed properly values. It 
is also important that the many Federal agencies that become involved 
in aspects of the brownfields problem recognize the important effects 
that funding and policy decisions can have toward promoting brownfields 
reuse and not encouraging sprawl conditions in our suburbs and rural 
areas.
                     brownfields legislative needs
I. Ensuring Adequate Resources for Brownfields Revitalization
    NALGEP finds that to ensure long-term success on brownfields, local 
governments need additional Federal funding for site assessment, 
remediation and economic redevelopment. The costs of site assessment 
end remediation can create a significant barrier to the redevelopment 
of brownfields sites. In particular, the costs of site assessment can 
pose an initial barrier that drives development away from brownfields 
sites. With this initial barrier removed, localities are much better 
able to put sites into a development/rack. In addition, the allocation 
of public resources for site assessment can provide a signal to the 
development community that the public sector is serious about resolving 
liability issues at a site and putting it back into productive reuse.
    The use of public funds for the assessment and cleanup of 
brownfields sites is a smart investment. Public funding can be 
leveraged into substantial private sector resources. Investments in 
brownfields yield the economic fruit of increased jobs, expanded tax 
bases for cities, and urban revitalization. And the investment of 
public resources in brownfields areas will help defer the environmental 
and economic costs that can result from unwise, sprawling development 
outside of our urban centers.
    The following types of Federal funding would go a long way toward 
helping local communities continue to make progress in revitalizing our 
brownfields sites:
    Grants for Site Assessments and Investigation: EPA's Brownfields 
Assessment Pilot grants have been extremely effective in helping 
localities to establish local brownfields programs, inventory sites in 
their communities, investigate the potential contamination at specific 
sites, and educate key stakeholders and the general public about 
overcoming the obstacles to brownfields redevelopment. Additional 
funding for site assessments and investigation is needed to help more 
communities establish local brownfields programs and begin the process 
of revitalizing these sites in their communities.
    Grants for Cleanup of Brownfields need for Federal grants to 
support the cleanup of brownfields sites across the country. The U.S. 
Conference of Mayors' recent report on the status of brownfields sites 
in 223 cities nationwide indicates that the lack of cleanup funds is 
the major obstacle to reusing these properties. For many brownfields 
sites, a modest grant targeted for cleanup can make the critical 
difference in determining whether a site is redeveloped, creating new 
jobs and tax revenues or whether the site remains polluted and idle.
    Grants to Capitalize Brownfields Cleanup Revolving Loan Funds: 
Federal funding to help localities and States establish revolving loan 
funds (RLFs) for brownfields cleanup is another effective mechanism to 
leverage public and private resources for redevelopment. EPA deserves 
credit for championing brownfields RLFs as a mechanism for helping 
communities fill a critical gap in cleanup funding. Unfortunately, the 
effectiveness of the EPA's current brownfields cleanup RLF program is 
severely undermined by the lack of new Federal brownfields legislation. 
Under current law, localities are required to jump through and over 
numerous National Contingency Plan (NCP) bureaucratic troops and 
hurdles to establish/heir local RLFs. These NCP requirements were 
originally established for Superfund NPL sites and not for brownfields 
sites. Consequently, we strongly recommend that any new legislation 
make it clear that local brownfields RLFs are not required to meet the 
NCP requirements established for Superfund sites.
II. Clarification of Superfund Liability at Brownfields Sites
    On the issue of Federal Superfund liability associated with 
brownfields sites, NALGEP has found that the Environmental Protection 
Agency's overall leadership and its package of liability clarification 
policies have helped establish a climate conducive to brownfields 
renewal, and have contributed to the cleanup of specific sites 
throughout the nation. It is clear that these EPA policies, and 
brownfields redevelopment in general, are most effective in States with 
effective voluntary cleanup programs. Congress can enhance these 
liability reforms by further clarifying in legislation that Superfund 
liability does not apply to certain ``non-responsible'' parties such as 
innocent landowners, prospective purchasers and contiguous property 
owners.
    NALGEP has also found that EPA's initiative to negotiate 
``Superfund Memoranda of Agreement'' (MOAs) with States that have 
effective voluntary cleanup programs has helped to facilitate 
brownfields cleanups in those States. Specifically, these MOAs defer 
liability clarification authority to those States. In order to further 
facilitate brownfields cleanups across the country, NALGEP finds that 
Congress should enable the EPA to delegate authority to limit liability 
and issue no further action decisions for brownfields sites to States 
with cleanup programs that meet minimum requirements to protect public 
health and the environment.
    A strong delegation of EPA liability clarification authority to 
approved States is critical to the effective redevelopment of local 
brownfields sites. Such delegation will increase local flexibility and 
provide confidence to developers, lenders, prospective purchasers and 
other parties that brownfields sites can be revitalized without the 
specter of Superfund liability or the involvement of Federal 
enforcement personnel. Parties developing brownfields want to know that 
the State can provide the last word on liability, and that there will 
be only one ``policeman,'' barring exceptional circumstances.
    At the same time, local officials are also concerned about 
delegating too much cleanup authority too fast to States. States vary 
widely in the technical expertise, resources, staffing, statutory 
authority and commitment necessary to ensure that brownfields cleanups 
are adequately protective of public health and the environment. If 
brownfields sites are improperly assessed, remediated or put into 
reuse, it is most likely that the local government will bear the 
largest brunt resulting from any public health emergency or 
contamination of the environment. NALGEP believes that the U.S. EPA has 
a key role to play in ensuring that liability authority over 
brownfields sites should only be delegated to States that demonstrate 
an ability and commitment to ensure protection of public health and the 
environment in the brownfields redevelopment process.
    To foster expanded redevelopment of brownfields sites while 
ensuring the protection of public health and the environment, NALGEP 
finds that there should be three components to the EPA brownfields 
delegation program. First, the law should clearly distinguish between 
Superfund NPL sites and other sites subject to enforcement under CERCLA 
or RCRA on one hand, and the remaining sites that can be put on a 
``brownfields track.'' The delegation of liability authority to States 
should focus on these ``brownfields back'' sites. Putting sites on a 
brownfields back will allow the application of EPA and State policy 
tools specifically designed to foster expedited, cost-effective 
brownfields redevelopment.
    Second, NALGEP finds that EPA delegation of liability authority 
over brownfields sites should be granted only to State cleanup programs 
that can ensure protection of public health and the environment. NALGEP 
suggests the following types of criteria for State delegation:
    1. Mechanisms to ensure adequate site assessments early in the 
process. Good site assessments will help prevent unanticipated problems 
from surfacing, and facilitate efforts to direct particular sites into 
a ``brownfields track.''
    2. Adequate State technical expertise, staff and enforcement 
authority to ensure effective implementation of cleanup activities.
    3. Use of risk-based cleanup standards, that can be tied to 
reasonably anticipated land use, established through an adequate public 
approval process.
    4. Institutional controls such as deed restrictions, zoning 
requirements or other mechanisms that are enforceable over time to 
ensure that future land uses tied to certain cleanup standards are 
maintained.
    5. Commitment to establish community information and involvement 
processes, and assurance that State and local brownfields activities 
will consider community values and priorities.
    6. Commitment to build the capacity, through training and technical 
assistance, of local government hearth and environmental agencies to 
affectively participate in the brownfields development process and 
ensure protection of public health and environment.
    7. Adequate mechanisms to address unanticipated cleanups or 
orphaned sites where liability has been eliminated.
    Finally, NALGEP believes that EPA's ability to reopen its 
involvement at a particular brownfields site in a delegated State 
should be limited to situations where there are exceptional 
circumstances and the State is not effectively addressing the problem. 
An EPA reopener for particular sites is necessary to ensure that EPA 
can become involved at any sites at which the State is unable or 
unwilling to adequately respond to a substantial and imminent threat to 
public health or the environment. At the same time, the reopener must 
be sufficiently limited to permit the State to take the lead role at 
brownfields sites, and to give confidence to developers, prospective 
purchasers, lenders and local governments that EPA will not improperly 
hinder or interfere in State liability decisions.
    Therefore, in delegating brownfields authority for non-NPL caliber 
sites to the States, NALGEP proposes that: EPA should provide that it 
will not plan or anticipate further action at any sites unless, at a 
particular site, there is: (1) an imminent and substantial threat to 
public health or the environment; and (2) either the State response is 
not adequate or the State requests U.S. EPA assistance.
III. Facilitating the Participation of Other Federal Agencies in 
        Brownfields Revitalization
    The cleanup and redevelopment of a brownfields site is often a 
challenging task that requires coordinated efforts among different 
government agencies at the local, State and national levels, public-
private partnerships, the leveraging of financial resources from 
diverse sources, and the participation of many different stakeholders. 
Many different Federal agencies can play a valuable role in providing 
funding, technical expertise, regulatory flexibility, and incentives to 
facilitate brownfields revitalization. For example, HUD, the Economic 
Development Administration, the Department of Transportation, and the 
Army Corps of Engineers have all contributed important resources to 
expedite local brownfields projects. The U.S. EPA and the 
Administration have provided strong leadership through the Brownfields 
Showcase Project to demonstrate how the Federal Government can 
coordinate and leverage resources from many different Federal agencies 
to help localities solve their brownfields problems.
    Congress can help strengthen the national brownfields partnership 
by further clarifying that the various Federal partners play a critical 
role in redeveloping brownfields and by encouraging the agencies to 
work cooperatively to meet local needs. For example, Congress should be 
commended for Legislation passed last year to clarify that HUD 
Community Development Block Grant funds can be used for all aspects of 
brownfields projects including site assessments, cleanup and 
redevelopment. This simple step has cleared the way for communities 
across the country to use these funds in a flexible fashion to meet 
their specific local needs. Similarly, Congress should take a look this 
year at clarifying that it is appropriate and desirable for the Army 
Corps of Engineers to use its resources and substantial technical 
expertise for local brownfields projects. In addition, Congress should 
consider clarifying that Department of Transportation funds can be used 
for cleanup activities associated with various transportation projects. 
Congress also should work with EPA to determine how other agencies can 
help facilitate more brownfields revitalization. By taking these steps, 
Congress can give communities additional tools, resources, and 
flexibility to overcome the many obstacles to brownfields 
redevelopment.
                               conclusion
    In conclusion, local governments are excited to work with the 
Federal Government to promote the revitalization of brownfields, 
through a combination of increased Federal investment in community 
revitalization, further liability clarification, and other mechanisms 
to strengthen the national partnership to cleanup and redevelop our 
communities. NALGEP thanks the committee for this opportunity to 
testify, and looks forward to working with you as the process moves 
forward.
                               __________
  Statement of Mike Nobis, National Federation of Independent Business
    Mr. Chairman and distinguished members of this committee, my name 
is Mike Nobis and I am from Quincy, Illinois. I would like to thank you 
for allowing me to speak to you today and to share my hometown's 
experiences with a landfill that became a Superfund site. I am the 
General Manager and part owner of JK Creative Printers. My company, 
which our family has owned for almost 30 years, employs 43 full time 
people. We are proud to be members of the National Federation of 
Independent Business (NFIB) and are honored to present this testimony 
on behalf of NFIB's 600,000 small business owner members.
    Quincy is a small community of 42,000 people, located on the banks 
of the Mississippi River just 150 miles north of St. Louis, MO. Our 
town is a great place to live and to raise a family. We have enjoyed 
years of good economic growth, good schools, strong community 
involvement and good city leadership. Of all the expectations we have 
for our town, having our local landfill declared a Superfund site was 
not one of them. In 1993, the Mississippi River reached its highest 
flood stages in history prompting our community to rally together and 
beat back the flood and its effects. Now, my community has been forced 
to band together again--to fight the unfairness of a Superfund law that 
is punishing us for legally disposing of our trash. Companies that once 
worked together to save our town from the flood, are now suing each 
other because of this Superfund landfill. Companies who have worked 
together for so many years are now suing one another.
    For my company, it started on February 10, 1999 when we received a 
letter in the mail from the EPA that stated 6 large local corporations 
and the city were looking to recover some of their cost for the cleanup 
of our local landfill. Even though what we had hauled there was only 
trash and totally legal, EPA said that because our trash was sent to 
that site, we were potentially responsible for paying our proportional 
share of the cleanup.
    When I read the letter, I felt sick. For me and the 148 other 
companies that received the letter, it was unexpected and without 
warning. At first, we had no idea of what the letter was telling us. It 
was asking us, as small companies, to ``contribute'' $3.1 million. I 
laughed at the language they used, contribute. They weren't asking us 
to contribute; they were threatening us to pay. My company's designated 
amount to pay was $42,000, and I consider myself lucky. There were 
several other companies and individuals being asked to pay $70,000, 
$85,000 and some to pay over $100,000. As I read through the list, I 
saw Catholic grade schools, our local university, bowling allies, 
restaurants, small Mom and Pop trash haulers, furniture stores and our 
local McDonald's listed to pay. Most of the companies named only 
generated waste like plain office trash or food scraps. In the mid 
70's, when our company's trash began to be put in the landfill, I was 
in college. One of the owners of another company was only 7 when this 
landfill was in use. Yet we are being held responsible. The document 
made it sound as though we were major hazardous waste dumpers. Yet, 
nowhere in the document did it list what waste we were accused of 
dumping. It only said that our trash was hauled to the landfill during 
the time in question and we now have to help pay for the cleanup, 
regardless of the fact that there was no other place to dump our trash.
    On February 24, 1999, the EPA sent one of their attorneys to Quincy 
to help explain the letter and to answer questions. The meeting lasted 
for over 2 hours. The EPA attorney tried to answer questions and to 
comment on how the law was being applied. Many people stood up and 
pleaded their situations and how unfair and un-American this whole 
situation was. He admitted to everyone there that the law was probably 
unfair and very harsh. He said it was intended to be harsh, but he 
couldn't do anything about its unfairness. Even though the law seemed 
unfair, he said that it was all he had to work with.
    EPA and the 6 large companies weren't concerned about the waste 
that was sent to the landfill. The make-up of what we sent there was 
irrelevant. It was the volume that we sent to the landfill that they 
cared about, even if the trash was not dangerous. They knew we didn't 
send hazardous waste and they knew we couldn't afford to fight them. We 
became an easy money source for them because of the real threat of 
litigation by the 6 large companies. And when you think about it, what 
small company can take on 6 large corporations and the EPA alone and 
win? If we didn't accept the settlement offer, the big 6 would sue us 
for the entire cleanup cost. We were stuck. Pay up or be wiped out. The 
attorney for the EPA admitted that it would cost us more to fight them 
in court to prove we didn't haul hazardous waste to the landfill than 
to just go ahead and settle. It all came down to money . . . . and they 
had more than we did.
    Who were the companies forced to pay this settlement? Most of the 
companies were individual people. Some were independent trash haulers; 
mom and dad hauling to help supplement their income to help raise their 
families. If you talk to them, you will notice they didn't make much 
money hauling trash. Others were small building contractors. Some are 
people in their retirement years. Some are widows whose husbands have 
passed away and they now have this settlement to deal with. Some are 
sons whose fathers once owned the business and now, years later, they 
have inherited the problem. We have business owners who bought 
businesses a few years ago who had nothing to do with this landfill, 
yet are being forced to pay up because they now own the assets and are 
the present money source. If they could have known this liability was 
going to be theirs in the future, they never would have bought the 
business. Mothers and fathers would have been reluctant to pass a 
family business--and its liability--to the next generation. We have 
some men in their late 70's and early 80's that could lose their life's 
savings when they should be enjoying their retirement years. They are 
spending their time and money paying the EPA for something they did 25 
years ago that was legal. Are these the people Superfund was designed 
to collect from or has something gone wrong? It is needless business 
pressures like this that destroy small businesses and cause undo pain 
and hardship. Victimizing small businesses is not going to help speed 
the cleanup of Superfund sites. Most of the cost contributed by our 
companies to this site didn't clean one ounce of the landfill. The 
money went to attorneys. Of all the money spent, the attorneys got the 
most. Consider how much the EPA and the big 6 gave attorneys in order 
to get the settlement with the 149 small companies. The EPA itself 
admits that 2/3 of the money in the Superfund is spent on litigation, 
not cleaning up the hazardous sites. The estimate for the legal help 
that some of us received in Quincy (not including the settlement 
amounts) is close to $500,000. This is hard stuff. And for what? Who 
wins? The attorneys are the winners. It was just reported in our local 
newspaper that the EPA and the 6 corporations are now suing all those 
companies who didn't settle, resulting in more business for the 
attorneys. As I understand it, these companies will be allowed in later 
months to bring third party lawsuits. Where will it end? I do not think 
this law's intent is to place hardships on small business when the 
ultimate winners are the attorneys, not the environment.
    To me and the thousands of small business owners that have been in 
my shoes, Superfund is not some abstract policy. Superfund affects 
small businesses, and has devastated my friends and neighbors, both 
emotionally and financially. Why? For doing the right thing 20-some 
years ago. I greatly admire the strength of Barbara Williams who has 
addressed this committee in the past. But, there are tons of small 
business owners that don't have the courage to fight. What will happen 
to those small businesses if we let this continue unchecked?
    Today our country's leaders need to look again at the intent of 
this law called Superfund. I don't believe you intended for it to 
burden or destroy individuals and small businesses in order to clean up 
hazardous sites. We have a chance to help small businesses get out from 
under this problem by supporting the language in the Superfund Program 
Completion Act of 1999.
    I commend this committee for looking seriously at this problem, and 
hope that this is the year small business owners will gain freedom from 
this unfair system. Small businesses need your help now. Please change 
this law for the benefit of small business owners and help restore some 
common sense to the Superfund law.
                               __________
   Statement of Red Cavaney, President, American Petroleum Institute
Introduction
    This statement is submitted to accompany the testimony of Mr. Red 
Cavaney, President of the American Petroleum Institute, before the 
Committee on Environment and Public Works, U.S. Senate, May 25, 1999, 
regarding S. 1090, the Superfund Program Completion Act of 1999. API 
represents approximately 400 companies involved in all aspects of the 
oil and gas industry, including exploration, production, 
transportation, refining, and marketing.
    API supports the provisions of the Chafee-Smith bill and applauds 
the sponsors for moving the Superfund debate a giant step forward. The 
legislation addresses the difficult and complex issue of liability 
reform--one of the central problems that has plagued the program; it 
moves the program toward completion by capping the number of sites to 
be added to the National Priority List and increasing the 
responsibility of the States for administering cleanup activity; it 
addresses the emerging issue of Brownfields rehabilitation; and, it 
appropriately recognizes that the Superfund program should be funded 
with general revenues.
    To be sure, the Superfund program needs additional repairs which we 
will address later in this testimony. However, as the sponsors of 
S.1090 so correctly note, the Congress and this Administration have 
been unable to find acceptable compromises on those issues. The lack of 
agreement on those issues should not prevent Congress from making the 
important changes embodied in the Chafee-Smith bill.
General Revenue Funding
    API wholeheartedly supports the intention of the sponsors of the 
Chafee-Smith bill to authorize general revenue funding of the Superfund 
program. As we have previously stated before this committee and others, 
the petroleum industry has a unique perspective with regard to 
Superfund. Petroleum-related businesses are estimated by EPA to be 
responsible for less than 10 percent of the contamination at Superfund 
sites; yet these businesses have historically paid over 50 percent of 
the taxes that were imposed to support the Trust Fund. This inequity 
has been of paramount concern to our members and must be rectified. The 
attached charts illustrate the unfair tax burden that has been imposed 
on our industry.
    Between 1982 and 1996, 74 percent of the Superfund program's 
funding came from specific Superfund taxes on industry (the petroleum 
tax, the chemical tax, and the corporate environmental income tax). 
During those years, the petroleum industry's share of annual taxes paid 
to Superfund ranged from 53 percent to 63 percent, averaging 57 percent 
over the entire period.
    EPA officials have claimed that using general revenues to pay for 
Superfund would be deserting the ``polluter pays'' principle and would 
be ``letting polluters off the hook.'' That is simply not true and does 
not reflect the reality of the Superfund program.
    The Superfund program was created to pay for the cleanup of 
``orphan'' waste disposal sites--those whose owners no longer exist 
(corporate owners) or who have died (individuals), or whose owners are 
bankrupt. Under the joint and several liability scheme of Superfund, 
once responsible parties are identified, the Fund itself is not looked 
to as the primary source of cleanup funding--unless those parties are 
insolvent. In fact, by the mid-1990's, the Superfund program had 
identified at least one potentially responsible party at 93 percent of 
nonFederal sites on the National Priority List. In other words, by that 
time only 7 percent of nonFederal sites on the NPL remained ``orphan'' 
sites requiring cleanup by EPA.
    In addition to covering the cleanup costs of ``orphan sites,'' EPA 
has been using the Superfund--funded with dedicated taxes--to pay 
administrative costs and for other purposes. In fact, EPA's use of 
Superfund moneys for other purposes has increased to such a degree that 
the General Accounting Office (GAO) reported that in 1998 only 46 
percent of the expended funds covered direct cleanup costs. Fifty-four 
percent paid the salaries of EPA officials, program administration, and 
other extraneous costs. The committee is well aware of other GAO 
findings--EPA's failure to recover all allowable costs from responsible 
parties, continued high program costs related to contractors, and EPA's 
failure to deobligate and recover unspent funds from completed 
Superfund contracts, to name just a few.
    EPA has reported recently that cleanup projects at 90 percent of 
the nonFederal Superfund sites are either completed or under 
construction, and responsible parties are performing 70 percent of all 
new remedial work. The funding needs of the program are declining and 
will continue to decline. It makes sense for Congress to use general 
revenues to pay for orphan shares and administrative costs in the 
remaining years of the program, just as the Chafee-Smith bill 
contemplates.
No Restrictions on Use of General Revenues
    Despite claims by some to the contrary, both GAO and the 
Congressional Budget Office have stated there is no legal or Budget Act 
restriction on the use of general revenues to fund the Superfund 
program. An explanation of the relationship and operation of the 
Superfund Trust Fund and appropriations for the Superfund program may 
be helpful.
    Historically the Superfund Trust Fund has received revenues from 
two main sources: dedicated taxes and general revenues. The dedicated 
taxes have included a chemical feedstock tax, a crude oil tax, and a 
general corporate environmental income tax. Those taxes expired at the 
end of 1995.
    The general revenue funding is transferred from the General Fund to 
the Trust Fund in the annual VA, HUD, and Independent Agencies 
appropriations bill, and that same bill appropriates money from the 
Superfund Trust Fund for annual Superfund program spending. The 
Superfund Trust Fund also collects revenues from interest on the moneys 
in the Fund, fines and penalties imposed under the Superfund program, 
deferred tax collections, receipts from deobligated funds, and cost 
recoveries from responsible parties.
    Under the Congressional Budget Act, the Superfund Trust Fund is 
considered to be ``on-budget'' for purposes of the unified budget. Any 
taxes dedicated to the Trust Fund are treated as revenues for purposes 
of the overall Federal budget, and any spending from the Trust Fund is 
included in the total spending for the Federal Budget. However, 
transfers between the General Fund and the Trust Fund (such as for 
interest or direct transfers of general revenues) do not have any 
budgetary impact.
    Superfund is a discretionary domestic program subject to the same 
budget rules that apply to all discretionary spending. The Trust Fund 
balance does not affect the amount that can be appropriated for the 
Superfund program. In other words, the discretionary spending caps, 
rather than the Trust Fund balance, control the Superfund program's 
spending level.
    To summarize the foregoing explanation, appropriations for the 
Superfund program are not connected to, and do not depend on, any 
dedicated taxes. Thus, concerns that without reinstatement of the taxes 
the Superfund program would grind to a halt are completely unfounded.
Brownfields
    The Chafee-Smith bill addresses the issue of brownfields 
rehabilitation by establishing grants for site investigation and 
remediation, and providing liability relief for innocent landowners and 
prospective purchasers of contaminated properties. API has supported 
brownfields reform as part of a comprehensive Superfund 
reauthorization. In addition, we have been concerned that the funding 
for this program not come from the Superfund Trust Fund and the Chafee-
Smith bill funds the program through general revenues. API members have 
identified the following elements as essential in development of a 
brownfields program:
    The remedy selection process for brownfields sites should be site-
specific and risk-based--as it should be for all Superfund sites.
    Reasonably anticipated future land and water uses must be 
considered in selecting the appropriate remedy.
    Liability protection should be given to owners and sellers of 
property, as well as to purchasers.
    A brownfields program should be broadly applied. The location of 
the site and redevelopment potential should determine brownfields 
applicability, not statutory jurisdiction. API believes that sites on 
the NPL and those proposed for listing, along with sites subject to 
corrective action or a planned removal under the Resource Conservation 
and Recovery Act (RCRA) should be eligible for brownfields programs.
    Money to fund brownfields programs should come from general 
revenues and should include EPA as well as HUD appropriations.
Comprehensive Reform
    API's position has been, and remains, that the current Superfund 
program should undergo comprehensive legislative reform, should sunset 
at the completion of cleanups of the CERCLA sites currently on the NPL, 
and should be paid for with general revenues. In addition to the 
liability scheme, other issues that the reform legislation should 
address are: remedy selection, natural resource damage assessments, no 
carve outs for any special interest s that have contributed waste to a 
site, and the possible transfer of the administration of cleanup 
programs to the States.
Remedy Selection Reform
    API members continue to support remediation standards that are 
site-specific and risk-based. We support provisions that would 
establish requirements for facility-specific risk evaluations to 
determine the need for remedial actions and to evaluate the 
protectiveness of remedial actions. The remediation process should 
provide protection of human health and the environment through methods 
that are practical and achievable in a cost-effective fashion. API has 
11 recommendations for reform.
    They include:
    --Remedy selection must be based onsite evaluation and scientific 
risk assessment combined with site-specific risk management decisions 
and remedy selection criteria.
    --Risks must be prioritized so that limited resources are used 
efficiently.
    --Benefit/cost analysis must be used to assess remedial 
alternatives.
    --Realistic land and water use assessment must be explicitly 
considered in remedy selection.
    --Groundwater remedy selection should be based on future use and 
exposure.
    --The preference for treatment and permanent solutions should be 
eliminated.
    --Provisions for use of Applicable or Relevant and Appropriate 
Requirements (ARARs) should be amended.
    --Technological feasibility must receive greater consideration in 
assessing alternative remedial actions.
    --The public should have input and receive information as part of 
the decisionmaking process.
    --Voluntary cleanup should be encouraged.
    --Pre-enforcement judicial review should be allowed.
Natural Resource Damage Provisions
    There are a number of revisions to the statute that would improve 
the NRD program under CERCLA and OPA. The following principles for NRD 
reform should be the core elements of such revisions:
    --Refocus the program on restoring, replacing or acquiring the 
equivalent of injured natural resources in order to re-establish the 
services provided to the public by the measurable and ecologically 
significant functions of the affected resources, and prohibit surplus 
recoveries based on speculative lost-use and non-use values.
    --Ensure that actions to restore or replace resources are cost-
effective and cost-reasonable.
    --Clarify the existing limitations on NRD liabilities.
    --Require NRD trustees to prove claims in court like any other 
plaintiff.
    --Require consistency between Superfund cleanup and NRD programs.
    API has commented extensively on these and other aspects of the 
Superfund program needing restructuring. We will continue to do so in 
the appropriate forums and to work for comprehensive reform. In the 
meantime, we believe that at this time the Chafee-Smith bill represents 
the best chance for legislative improvement and continued funding of 
the program through general revenues.
    In conclusion, API appreciates the opportunity to testify in 
support of the Chafee-Smith reform proposal, and we commend the 
sponsors for their diligent efforts dedicated to improving the 
Superfund program.





                               __________
           Statement of the National Association of Realtors
    Thank you for the opportunity to present the views of the National 
Association of Realtors (NAR) on S. 1090, the Superfund Program 
Completion Act. I wish to thank Chairman Chafee and Chairman Smith for 
their continued and determined leadership in building bipartisan 
consensus on this very important issue.
    My name is Mike Ford. I own a full service residential and 
commercial real estate company in Clark, New Jersey, and I have been a 
real estate broker for 25 years.
    It is often said--and I agree--that realtors don't sell homes, we 
sell communities. The more than 730,00 members of the National 
Association of Realtors, real estate professionals involved in all 
aspects of the real estate industry, are concerned and active members 
of our communities. We want clean air, clean water and clean soil. We 
want to see properties affected by historic pollution cleaned up and 
returned to the marketplace. We care about a healthy quality of life as 
well as a vibrant economy, and we are willing to do our part to 
maintain that important balance.
    However, we also expect the same fairness, certainty and 
predictability from government regulators that our customers and 
business partners expect from us. In this respect, Superfund has 
clearly failed.
    Superfund began with the laudable goal of cleaning up hazardous 
waste sites to protect human health and the environment. Progress has 
been achieved, and for that the EPA deserves credit. Unfortunately, 
progress has come at a high price. While serving as a mechanism for 
hazardous waste cleanup, Superfund has also served as an engine for 
massive litigation. Deep-pocket parties targeted by EPA have turned 
around and sued smaller parties. Many of these smaller parties--small 
business owners who did nothing more than dispose of common garbage, 
recyclers who tried to be environmentally conscious, and innocent 
property owners who have not caused or contributed to hazardous waste 
contamination--have been drawn into years of costly litigation 
defending against the threat of huge cleanup liability.
    As a first step, these parties should be provided with the maximum 
possible degree of liability relief so that resources can be targeted 
toward cleanup rather than litigation. When it comes to Superfund 
cleanup, we must ensure that the real polluters pay so that hazardous 
waste sites are returned to productive use as quickly as possible.
    From the perspective of a taxpaying citizen, it is the right thing 
to do to ensure that Superfund is administered in a fair and effective 
manner. From the perspective of a businessman, it will provide the 
certainty needed in order to move forward in developing sites that are 
known or suspected to be contaminated.
    As a second step, the Federal Government should recognize and 
support the hazardous waste cleanup efforts underway at the state 
level. In an effort to revitalize their urban centers, most of the 
states--including my home state of New Jersey--are creatively attacking 
the hazardous waste problem by providing incentives through voluntary 
cleanup programs.
    One common incentive provided by these programs is liability 
relief. Typically, the state will provide some form of liability relief 
once it has approved a cleanup. In New Jersey, relief comes in the form 
of a ``No Further Action'' letter from the state DEP. Unfortunately, 
there is no guarantee that the Federal EPA will not assert authority at 
a future date and require additional cleanup. Without the certainty of 
knowing that they are protected from Federal as well as from state 
liability, property owners and developers are very reluctant to 
undertake development of a site which is or might be contaminated.
    In New Jersey, we have our fair share of hazardous waste sites. 
However, I've seen what can be accomplished when local, state and 
Federal Government work together with private business interests to 
make something out of nothing. In my home town of Clark, General Motors 
cleaned up a contaminated property and funded construction of a golf 
course. The local government runs the course and makes a healthy 
profit.
    If these reforms are achieved, hazardous waste sites throughout the 
country will be returned to productive use, revitalizing communities by 
increasing the tax base, creating jobs, and rejuvenating neighborhoods. 
Otherwise they will remain barren, contributing to nothing but economic 
ruin.
    S. 1090 presents a ``win-win'' opportunity for everyone by 
achieving cleanup of hazardous waste sites, encouraging property reuse 
and enhancing community growth. Now is the time for Congress to assert 
bipartisan leadership and reinforce our nationwide effort to turn 
``brownfields'' into ``greenfields.'' The NATIONAL ASSOCIATION OF 
REALTORS supports S. 1090, and we encourage the 106th Congress to act 
now on Superfund reform.
    Thank you again for the opportunity to present the views of the 
National Association of Realtors. I am happy to answer any questions.
                               __________
           Statement of the Association of Battery Recyclers
    Mr. Chairman and members of the committee, we thank you for the 
opportunity to submit this statement on behalf of the Association of 
Battery Recyclers, Inc. (``ABR''). The ABR represents the interests of 
the lead recycling industry. This statement addresses the ``recycling 
exemption'' contained in S. 1090 and sets forth several issues of 
concern to the ABR regarding the application of the exemption to lead 
bearing materials.
    The ABR has previously raised concerns about the need for, and the 
scope of, a recycling exemption. These concerns have been limited to 
the issues associated with the recycling of lead bearing materials, and 
in particular, lead acid batteries. The lead industry consistently has 
achieved recycling rates of more than 90 percent for many years, an 
achievement far beyond that attained for any other recyclable material. 
This result has been achieved without the imposition of any ``recycling 
exemption'' from Superfund liability. Nonetheless, this exemption has 
been advocated by others based (in part) on the need to encourage 
recycling activities. Moreover, the exemption provides relief only for 
a limited number of parties, and does not apply to the owners and 
operators of the facilities that actually conduct the recycling 
activities. Thus, the ABR continues to question the need for and the 
limited scope of the exemption.
    Notwithstanding these concerns, the ABR has participated in the 
legislative dialog over the last several years in an effort to reach a 
compromise with those parties advocating the exemption. The ABR 
recognizes that much effort has been expended in constructing the 
exemption. Thus, the ABR will limit its comments in this statement to 
certain specific issues of concern to the lead recycling industry in 
the hope that the exemption will be modified to reflect the interests 
of all parties involved in the lead recycling chain.
    First, if the exemption is to be fair and meaningful, it must 
include all parties involved in the recycling chain. Specifically, the 
exemption should extend to secondary lead smelters that reclaim lead-
bearing materials. The smelters are the critical component to the 
successful recycling rates achieved by the lead industry.
    Second, the definition of the term ``recyclable material'' omits 
any mention of battery parts, various lead-bearing battery materials 
(powders, sludges, crosses, etc.) or lead-bearing materials from other 
industries (e.g., chemical industry, electronics industry). As a 
result, facilities handling such materials implicitly are not exempted 
from Superfund liability by the bill.
    Third, since the exemption is retroactive, the bill would reward 
recalcitrant potentially responsible parties (``PRPs''), and would 
penalize PRPs who have voluntarily cooperated with the government in 
site cleanup efforts. The exemption should be made prospective from the 
date of enactment of the bill or it should contain ``transition'' 
language that avoids rewarding recalcitrant PRPs. Specifically, Section 
301(b)(2)(B) should be amended to preclude application of the exemption 
to pending administrative and enforcement actions, in addition to 
pending judicial actions. No relief should be afforded to a party that 
prior to enactment of S. 1090 has received but not complied with an 
enforcement order issued pursuant to Section 106.
    Finally, Section 303 of the bill would allow parties otherwise 
liable but for the recycling exemption to collect attorneys fees, and 
other litigation costs, from PRPs who seek contribution, even if the 
PRPs have a good faith believe that the other parties do not qualify 
for the exemption. This provision will discourage PRPs from initiating 
cleanups, since they will be penalized for seeking contribution from 
other similarly situated parties for their response costs. Hence, 
Section 303 should be modified to provide that litigation fees and 
costs should only be imposed where it can clearly be demonstrated that 
there was no basis to file a contribution action.
    On behalf of the Association of Battery Recyclers, Inc., we 
appreciate the opportunity to submit these comments. We commend you and 
the other committee members in their efforts to amend Superfund in a 
manner that is more workable and fair to all affected parties.
                               __________
                          Hazardous Waste Action Coalition,
                                                      June 4, 1999.

The Honorable John H. Chafee, Chairman,
Senate Environment and Public Works Committee
Dirksen Senate Office Building
Washington, DC 20510

    Dear Chairman Chafee and Chairman Smith: On behalf of the Hazardous 
Waste Action Coalition (HWAC), the association of leading engineering 
and science firms practicing in multimedia environmental management and 
remediation, I respectfully request that the attached letter be made 
part of the hearing record for the May 25 hearing on S.1090, the 
Superfund Program Completion Act of 1999. If you have any questions, or 
if you need additional copies of the attached letter or a disc 
containing the letter, feel free to contact HWAC staffer Carolyn Kiely 
at 202-682-4354.
            Sincerely,
                              Daniel E. Kennedy, President.
                                 ______
                                 
           Statement of the Hazardous Waste Action Coalition
    As you know, the Hazardous Waste Action Coalition (HWAC) is the 
leading trade association representing engineering and science firms 
practicing in multimedia environmental management and remediation. HWAC 
member firms are at the forefront of implementing the nation's 
Superfund law for the governmental and private sectors. HWAC has been a 
strong supporter of your efforts to comprehensively reform the Federal 
Superfund statute over the past several years.
    HWAC is disappointed that this year's Superfund Program Completion 
Act of 1999 (S. 1090) addresses only limited aspects of the Superfund 
program, while leaving intact the most important element of the 
program, the actual methodology for hazardous waste cleanup. Tinkering 
with some aspects of the ``who pays'' component of Superfund, while 
winding down funding to conduct and oversee cleanups, and at the same 
time leaving the present cleanup system unchanged, will perpetuate many 
of the present complaints about the slow pace and high cost of cleanup. 
In addition, not reforming the liability traps that snare response 
action contractors when they try to be efficient and innovative in 
cleaning up problems is a shortcoming that actually harms all 
stakeholders.
    HWAC strongly encourages you to promote the comprehensive changes 
advanced in S.8, which you cosponsored in the last Congress. S.8 
established bold reforms that would truly move the Superfund program 
forward. The major beneficiaries of S.8's reforms would be the American 
public, who would receive more prompt, cost-effective cleanups that 
truly protect public health and the environment.
    As the implementers of hazardous waste cleanups, we see on a day-
to-day basis what in the present law isn't working from a practical, 
implementation viewpoint. HWAC truly believes that the only way to 
improve the workings of the present law is through comprehensive reform 
that touches all aspects of the program. The current law is in need of 
significant changes in remedy selection and cleanup methodologies, as 
well as reform of the liability and funding provisions. Changing the 
remedy selection portion of Superfund is where the American public will 
receive the largest benefit from legislative Superfund reauthorization 
efforts. Presently, those parties who are undertaking responsible 
cleanup activities are often unable to take advantage of today's 
innovative technologies which would ultimately lead to more efficient 
and cost-effective cleanup of hazardous waste sites.
    We wish to work cooperatively with your office to address our 
concerns, with the hope that we would then be able to support your 
efforts to pass comprehensive Superfund legislation this year. HWAC 
stands ready to work with you as needed to debate the changes which are 
vital to improving the overall cleanup process and result in cheaper, 
faster, more cost-effective cleanups that will benefit the American 
public. Feel free to contact me at 202-828-7368 to discuss our views on 
Superfund implementation at your convenience.
                               __________
               Statement of the Nuclear Energy Institute
    Mr. Chairman and members of the subcommittee, my name is Joe 
Colvin. I am president and chief executive officer of the Nuclear 
Energy Institute. The Institute sets policy for the U.S. nuclear energy 
industry and represents more than 275 members with a broad spectrum of 
interests, including every U.S. utility that operates a nuclear power 
plant. NEI's members also include nuclear fuel cycle companies, 
suppliers, engineering and consulting firms, national research 
laboratories, manufacturers of radiopharmaceuticals, universities, 
labor unions and law firms.
    The Institute is pleased that the Subcommittee is re-authorizing 
the Comprehensive Environmental Response, Compensation, and Liability 
Act of 1980 (CERCLA) and commends Chairman Smith, Ranking Member 
Lautenberg and subcommittee members for undertaking the reform and 
affording the industry an opportunity to comment for the record.
    In reauthorizing CERCLA, this subcommittee has an opportunity to 
make reforms to the law that would greatly improve Federal oversight by 
directing effective use of Federal agency authority, expertise and 
resources. In doing so, this subcommittee would eliminate duplicative 
and inconsistent regulatory policies that arise during the license 
termination and cleanup of sites licensed by the Nuclear Regulatory 
Commission through its authority under the Atomic Energy Act of 1954. 
Those sites include medical institutions, universities with research 
programs, radiopharmaceutical companies and nuclear power plants.
    Such action will align the National Priorities List--the Superfund 
program--with President Clinton's Executive Order No. 12866 \1\ to 
implement ``a regulatory system that protects and improves [the 
American people's] health, safety, environment and well-being and 
improves the performance of the economy without imposing unacceptable 
or unreasonable costs on society.''
---------------------------------------------------------------------------
    \1\ Executive Order 12866 of September 30, 1993, ``Regulatory 
Planning and Review,'' published in the Federal Register, Vol. 58 No. 
190, pp. 51735-51744, dated Monday, October 4, 1993.
---------------------------------------------------------------------------
    In its current form, CERCLA sets the stage for conflicting and 
overlapping authority between the NRC and Environmental Protection 
Agency that prohibits the remediation of NRC-licensed sites in a safe, 
timely, and cost-effective manner. The conflict stems from the fact 
that the Atomic Energy Act gives the NRC responsibility to regulate 
civilian use of nuclear materials. Under its authority, the NRC has 
overseen the successful remediation of more than 70 sites to a level 
that fully protects public health and safety. By comparison, CERCLA 
assigns the EPA primary responsibility to administer the remediation of 
contaminated sites included on the Superfund list.
    This subcommittee can eliminate the statutory confusion created in 
CERCLA by reaffirming the NRC's authority under the Atomic Energy Act 
of 1954 to oversee license termination and site remediation of NRC 
licensees. This clarification would ensure that Federal resources are 
used efficiently and effectively. More importantly, amending the CERCLA 
language will continue to ensure full protection of public health and 
safety.
Background
    In 1992, the EPA agreed to defer remediation of NRC-licensed sites 
to the nuclear regulator. That interagency accord was consistent with 
NRC's mission under the Atomic Energy Act of 1954, to act as the sole 
regulator and standard-setter of certain radioactive materials. Drawing 
on that accord, the NRC used its policy and guidelines to successfully 
regulate the site remediation and license termination on a case-by-case 
basis of more than 70 sites.
    In 1997, the NRC formalized its approach by issuing a final rule 
that included a generic environmental impact statement. In addition to 
providing a clear regulatory approach, the final rule articulated 
specific radiation safety standards for remediation and license 
termination. The NRC stated that ``the final rule will result in more 
efficient and consistent licensing actions related to the numerous and 
complex site decommissioning activities anticipated in the future.''
    The NRC adopted this rule after 4 years of extensive scientific 
study and public comment, during which NRC held more than a dozen major 
workshops and meetings on residual radiation standards and provided 
three separate noticed requests for public comments. This broad level 
of public-participation produced more than 7,000 comments from a wide 
range of interests--including scientific and professional 
organizations--EPA and other Federal agencies, state and local 
governments; Native Americans, NRC licensees, academic bodies, and 
civic and environmental organizations. The EPA actively participated in 
this process and was consulted by NRC throughout the rulemaking effort.
    NRC's 4-year rulemaking process and related scientific studies led 
the agency to conclude that public health and safety is best protected 
by a regulation that sets a maximum limit on potential exposure to 
members of the public from residual radiation at remediated sites from 
all possible ``dose pathways,'' such as air, soil, surface and ground 
water, and food products grown at the remediated site. The regulation 
also requires that a site-specific, cost-benefit analysis be performed 
by the licensee to identify actions to be taken to further remediate 
the site and reduce potential levels of exposure below the maximum 
limit.
    The approach taken by NRC including a maximum radiation dose limit 
and a requirement to further reduce potential exposure to levels that 
are-''as low as reasonably achievable,'' incorporates the 
recommendations of respected national and international scientific 
organizations \2\ and is consistent with regulatory standards adopted 
in other countries. However, this approach differs from that taken 
previously by the EPA. The EPA approach included a maximum radiation 
dose limit, but does not include a requirement to further reduce 
exposure levels. EPA also supports a separate groundwater requirement 
that utilizes the maximum contaminant levels (MCLs) established by EPA 
under the Safe Drinking Water Act (SDWA).
---------------------------------------------------------------------------
    \2\ Such organizations include the National Council on Radiation 
Protection and Measurements, the International Commission on 
Radiological Protection, and the International Atomic Energy Agency.
---------------------------------------------------------------------------
    Based primarily on the lack of a separate radiation standard for 
groundwater in the NRC rule, EPA Administrator Carol Browner in 1997 
informed NRC Chairman Shirley Jackson that EPA ``would be forced to 
reconsider its policy of exempting NRC sites'' unless EPA's approach 
was incorporated into NRC's final rule. \3\
---------------------------------------------------------------------------
    \3\ Letter from EPA Administrator Carol M. Browner to NRC Chairman 
Shirley Ann Jackson, Feb. 7, 1997.
---------------------------------------------------------------------------
    Shortly before that correspondence, EPA pursued its rule for site 
cleanup standards that would have been generally applicable to all 
Federal agencies, including the NRC. However, the EPA rule was rejected 
during an interagency review process, involving primarily EPA, NRC and 
the Energy Department, facilitated by the Office of Management and 
Budget. The EPA formally withdrew its proposed rulemaking in December 
1996.
    After substantial interaction with EPA--and despite continuing 
disagreement between the agencies on the regulatory approach to site 
remediation--the NRC issued its final rule in July 1997. NRC's rule has 
been applied to license termination decisions for its licensees.
    Nonetheless, the EPA has continued to challenge NRC's regulatory 
program. In August 1997, the EPA issued a guidance memorandum to its 
regional offices that rejects the general acceptance of NRC's criteria 
under CERCLA, although the memorandum notes: ``We expect that NRC's 
implementation of the [NRC] rule for license termination will result in 
cleanups within the Superfund risk range at the vast majority of NRC 
sites.'' \4\ EPA also has interacted with public interest groups and 
the media on the decommissioning of NRC-licensed facilities, expressing 
concerns about the NRC standard and regulatory approach. Most recently, 
the EPA has formally criticized NRC's regulatory process as part of an 
NRC licensing review and has requested technical information from an 
NRC licensee regarding its site remediation plans.
---------------------------------------------------------------------------
    \4\ Establishment of Cleanup Levels for CERCLA Sites with 
Radioactive Contamination, Aug. 22, 1997, OSWER No. 9200.4-18.
---------------------------------------------------------------------------
    Through its duplicative actions, the EPA is diverting attention 
away from the NRC's clear, consistent site cleanup standards to protect 
public health and safety. Rather, the focus has shifted to EPA's 
refusal to accept NRC's decommissioning standards for remediated sites. 
In the case of nuclear power plants, NRC regulations require plant 
licensees to collectively accrue $45 billion in funds to decommission 
these sites. It would be financially imprudent for these licensees to 
spend accrued funds to pursue cleanup under a threat of being revisited 
by another Federal agency on the same issues.
    Such EPA interactions have taken place despite congressional 
direction that the NRC site remediation rule fully protect public 
health and safety: ``It has come to the [Appropriations] Committee's 
attention that the [EPA] has recently proposed the reversal of its 
long-standing policy of deferring to the . . . NRC for cleanup of NRC-
licensed sites. In the past, EPA has not placed sites which have been 
successfully remediated under the NRC on the National Priority List. 
The Committee is satisfied that the NRC has and will continue to 
remediate sites to a level that fully protects public health and 
safety, and believes that reversing this policy is unwarranted and not 
a good use of public or private funds. EPA is therefore directed to 
continue its long-standing policy on this matter with the NRC and spend 
no funds to place NRC-remediated sites on the NPL.'' \5\
---------------------------------------------------------------------------
    \5\ House Rpt. 105-610: Departments of Veterans Affairs and Housing 
and Urban Development and Independent Agencies Appropriations Bill for 
1999 (accompanies H.R. 4194-P.L. 105-276).
---------------------------------------------------------------------------
EPA's Interaction In Remediation of NRC-Licensed Sites Is Duplicative, 
        Inconsistent
    EPA's continuing interactions in NRC's regulatory process reflect 
an inconsistent and duplicative regulatory approach and demonstrate a 
threat to list remediated sites on the National Priorities List even 
after a NRC has terminated a license and relinquished jurisdiction.
    To that end, EPA's intervention has raised serious stakeholder 
concerns regarding the authority and finality of NRC licensing 
decisions; the potential of parties associated with affected sites for 
future liability; and the looming uncertainty regarding a site 
remediation's ultimate duration and costs. More importantly, EPA's 
involvement erodes stakeholder confidence in the integrity of Federal 
regulatory review and oversight, which runs counter to the objectives 
of the administration for ``reforming and making more efficient the 
regulatory process.''
    For the reasons stated above, the industry respectfully recommends 
that the subcommittee consider including the enclosed amendment in 
legislation to reauthorize the Superfund program. We note that the 
proposed amendments are drawn from NRC recommendations for legislative 
changes recently submitted to the Vice President. \6\
---------------------------------------------------------------------------
    \6\ Letter from NRC Chairman Shirley Ann Jackson to Vice President 
Albert Gore, Jr., as President of the U.S. Senate, dated May 13, 1999.
---------------------------------------------------------------------------
    The Nuclear Energy Institute appreciates the opportunity to provide 
the industry's perspective on this important issue.
                               ATTACHMENT
   suggested amendments to the comprehensive environmental response, 
                 compensation and liability act of 1980
    The Comprehensive Environmental Response, Compensation and 
Liability Act of 1980 (42 U.S.C. 9601 et seq.) is amended--(1) by 
adding the following new paragraph at the end of section 121(b):
    ``(3) No authority of this Act may be used to commence an 
administrative or judicial action with respect to source, special 
nuclear, or byproduct material that is subject to the decontamination 
regulations issued by the Nuclear Regulatory Commission for license 
termination under the Atomic Energy Act of 1954, or by a State that has 
entered into an agreement pursuant to section 274.b. of that Act, 
unless such action is requested by the Nuclear Regulatory Commission 
or, in the case of such material under the Jurisdiction of a State that 
has entered into an agreement pursuant to section 274.b. of that Act, 
the Governor of the State.'' (2) by inserting the following before the 
period at the end of paragraph (K) of section 101 (10):
    ``, or any release of such material in accordance with regulations 
    of the Nuclear Regulatory Commission following termination of a 
    license issued by the Nuclear Regulatory Commission pursuant to the 
    Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.) or by a State 
    acting under an Agreement entered into pursuant to section 274.b. 
    of that Act.''

                                  
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