[Congressional Record Volume 145, Number 114 (Thursday, August 5, 1999)]
[Senate]
[Pages S10431-S10433]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. LOTT (for himself, Mr. Daschle, Mr. Chafee, Mrs. Lincoln, 
        Mr. Warner, and Mr. Baucus):
  S. 1528. A bill to amend the Comprehensive Environmental Response, 
Compensation, and Liability Act of 1980 to clarify liability under that 
Act for certain recycling transactions; to the Committee on Environment 
and Public Works.


                    SUPERFUND RECYCLING ACT OF 1999

  Mr. LOTT. Mr. President, today I am pleased to join my distinguished 
colleagues, Senate Minority Leader Daschle, and Senators Warner, 
Chafee, Baucus, and Lincoln, in introducing the Superfund Recycling 
Equity Act of 1999.
  This legislation, similar to that which the distinguished minority 
leader and I introduced in the previous Congress, removes an unintended 
consequence of the Superfund statute that has inhibited the growth of 
recycling in our nation. I am certain that when the Congress passed the 
Comprehensive Emergency Response, Liability and Compensation Act 
(CERCLA), members of both bodies did not want, and did not suggest, 
that traditional recyclable materials--paper, glass, plastic, metals, 
textiles, and rubber--should be any more subject to Superfund liability 
than a competitive product made of virgin material. However, that is 
how the courts have interpreted Superfund.
  Consequently, CERCLA has created a competitive disadvantage between 
virgin materials used as manufacturing feedstocks and recyclable 
materials used for precisely the same purpose. The courts have 
concluded that recyclables are materials that have been disposed of and 
are therefore subject to Superfund liability. Even most American 
schoolchildren know, recycling is good for the nation--that recycling 
is the exact opposite of disposal. Recycling serves important national 
goals by keeping materials from entering the waste stream. Through 
recycling we reclaim useful products and materials. We use recyclables 
as manufacturing feedstocks just as we do virgin raw materials, but 
using recyclables also helps to preserve the earth's scarce resources, 
reduces society's energy demand, lowers water and air pollution and 
reduces solid waste.
  Mr. President, our bill corrects this unintended consequence of 
Superfund. It recognizes that recycling is not disposal. That recyclers 
are not subject to Superfund's liability scheme should the owners of 
mills, foundries or refineries, to which recyclers ship their material, 
contaminate their facilities.
  Let me highlight an example of the unintended consequence that will 
continue to exist without this needed clarification. A recycler sends 
scrap metal as feedstock to be manufactured into a new product at a 
mill. The same mill also uses virgin metals to make the identical 
product. If the mill contaminates its facility with a hazardous 
substance, only the recyclable becomes subject to Superfund liability. 
Because recyclables are considered solid wastes, the recycler's actions 
are considered arranging for disposal, thus creating liability. 
However, the shipper of the virgin material is not liable under 
Superfund since it shipped a product and did not ``arrange for 
disposal.''
  The Superfund Recycling Equity Act of 1999 is essential to correct 
Superfund's unintended bias against recycling. It will provide the same 
relief from Superfund liability for legitimate recyclers as that 
enjoyed by those who sell virgin materials. It will also ensure that, 
sham recyclers will not benefit from the provisions of this bill. The 
Superfund Recycling Equity Act contains conditions that can only be met 
by legitimate recyclers of paper, glass, plastic, metals, textiles and 
rubber. And, to be free of liability, recyclers must act in an 
environmentally sound manner and sell their product to manufacturers 
with environmentally responsible business practices.
  It is also important to note what this bill will not do. It will not 
relieve from liability any recycler who has contaminated his own 
facility. Nor will it assist recyclers who have disposed of waste at 
landfills or other places at which waste was the cause of a release of 
hazardous substances to a site that is addressed by the Superfund 
program.
  Mr. President, the Senate Minority Leader and I previously stated our 
intention that, should a more comprehensive Superfund bill fail to move 
toward conclusion in the Senate, we would work in a bipartisan fashion, 
toward the goal of Superfund relief for legitimate recyclers in the 
1999 session of this Congress. Members of the Environment and Public 
Works, led by Chairman Chafee, Subcommittee Chairman Smith, and Ranking 
Minority Member Baucus, have worked extraordinarily hard to try to 
bring a common sense Superfund bill to the Senate floor that addresses 
a series of issues, including relief for recyclers. Unfortunately, once 
again, differences appear to have stymied that effort. I congratulate 
my colleagues for their efforts to address this issue. However, 
realizing the chances of passing a more comprehensive Superfund reform 
bill are now somewhat remote, it is time to address the Superfund 
recycling issue.
  The language offered today is similar to the bipartisan measure we 
introduced last year. In the last Congress, the Minority Leader and I 
were joined by 63 of our colleagues across party and ideological lines 
in support of the Superfund Recycling Equity Act (S. 2180). It is now 
time to complete our work and provide relief--relief for recyclers that 
is long overdue.

[[Page S10432]]

  There is one remaining issue regarding polychlorinated biphenyls 
(PCBs) in recycled paper which has been the subject of negotiations 
between various parties and the Administration. It is my understanding 
that these parties are negotiating in good faith, and that many, but 
not all issues, have been resolved. I have said in the past, I would be 
willing to modify the Superfund recycling language if the original 
negotiating partners agreed to a proposed language change. That remains 
my position. Should there be an agreement among the original 
negotiators on the paper PCB issue subsequent to today's introduction, 
I will at the earliest appropriate moment make the agreed upon change.
  Mr. President, Americans have properly embraced the benefits of 
recycling. Americans know that increased recycling means more efficient 
use of natural resources and a meaningful reduction in solid waste. By 
removing the threat of Superfund liability for recyclers, Congress will 
stimulate more recycling. I urge all of my colleagues to cosponsor this 
pro-environment bill.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1528

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Superfund Recycling Equity 
     Act of 1999''.

     SEC. 2. PURPOSES.

       The purposes of this Act are--
       (1) to promote the reuse and recycling of scrap material in 
     furtherance of the goals of waste minimization and natural 
     resource conservation while protecting human health and the 
     environment;
       (2) to create greater equity in the statutory treatment of 
     recycled versus virgin materials; and
       (3) to remove the disincentives and impediments to 
     recycling created as an unintended consequence of the 1980 
     Superfund liability provisions.

     SEC. 3. CLARIFICATION OF LIABILITY UNDER CERCLA FOR RECYCLING 
                   TRANSACTIONS.

       (a) Clarification.--Title I of the Comprehensive 
     Environmental Response, Compensation, and Liability Act of 
     1980 (42 U.S.C. 9601 et seq.) is amended by adding at the end 
     the following new section:

     ``SEC. 127. RECYCLING TRANSACTIONS.

       ``(a) Liability Clarification.--As provided in subsections 
     (b), (c), (d), and (e), a person who arranged for recycling 
     of recyclable material shall not be liable under section 
     107(a)(3) or 107(a)(4) with respect to the material.
       ``(b) Recyclable Material Defined.--For purposes of this 
     section, the term `recyclable material' means scrap paper, 
     scrap plastic, scrap glass, scrap textiles, scrap rubber 
     (other than whole tires), scrap metal, or spent lead-acid, 
     spent nickel-cadmium, and other spent batteries, as well as 
     minor amounts of material incident to or adhering to the 
     scrap material as a result of its normal and customary use 
     prior to becoming scrap; except that such term shall not 
     include shipping containers of a capacity from 30 liters to 
     3,000 liters, whether intact or not, having any hazardous 
     substance (but not metal bits and pieces or hazardous 
     substance that form an integral part of the container) 
     contained in or adhering thereto.
       ``(c) Transactions Involving Scrap Paper, Plastic, Glass, 
     Textiles, or Rubber.--Transactions involving scrap paper, 
     scrap plastic, scrap glass, scrap textiles, or scrap rubber 
     (other than whole tires) shall be deemed to be arranging for 
     recycling if the person who arranged for the transaction (by 
     selling recyclable material or otherwise arranging for the 
     recycling of recyclable material) can demonstrate by a 
     preponderance of the evidence that all of the following 
     criteria were met at the time of the transaction:
       ``(1) The recyclable material met a commercial 
     specification grade.
       ``(2) A market existed for the recyclable material.
       ``(3) A substantial portion of the recyclable material was 
     made available for use as feedstock for the manufacture of a 
     new saleable product.
       ``(4) The recyclable material could have been a replacement 
     or substitute for a virgin raw material, or the product to be 
     made from the recyclable material could have been a 
     replacement or substitute for a product made, in whole or in 
     part, from a virgin raw material.
       ``(5) For transactions occurring 90 days or more after the 
     date of enactment of this section, the person exercised 
     reasonable care to determine that the facility where the 
     recyclable material was handled, processed, reclaimed, or 
     otherwise managed by another person (hereinafter in this 
     section referred to as a `consuming facility') was in 
     compliance with substantive (not procedural or 
     administrative) provisions of any Federal, State, or local 
     environmental law or regulation, or compliance order or 
     decree issued pursuant thereto, applicable to the handling, 
     processing, reclamation, storage, or other management 
     activities associated with recyclable material.
       ``(6) For purposes of this subsection, `reasonable care' 
     shall be determined using criteria that include (but are not 
     limited to)--
       ``(A) the price paid in the recycling transaction;
       ``(B) the ability of the person to detect the nature of the 
     consuming facility's operations concerning its handling, 
     processing, reclamation, or other management activities 
     associated with recyclable material; and
       ``(C) the result of inquiries made to the appropriate 
     Federal, State, or local environmental agency (or agencies) 
     regarding the consuming facility's past and current 
     compliance with substantive (not procedural or 
     administrative) provisions of any Federal, State, or local 
     environmental law or regulation, or compliance order or 
     decree issued pursuant thereto, applicable to the handling, 
     processing, reclamation, storage, or other management 
     activities associated with the recyclable material. For the 
     purposes of this paragraph, a requirement to obtain a permit 
     applicable to the handling, processing, reclamation, or other 
     management activity associated with the recyclable materials 
     shall be deemed to be a substantive provision.
       ``(d) Transactions Involving Scrap Metal.--
       ``(1) Transactions involving scrap metal shall be deemed to 
     be arranging for recycling if the person who arranged for the 
     transaction (by selling recyclable material or otherwise 
     arranging for the recycling of recyclable material) can 
     demonstrate by a preponderance of the evidence that at the 
     time of the transaction--
       ``(A) the person met the criteria set forth in subsection 
     (c) with respect to the scrap metal;
       ``(B) the person was in compliance with any applicable 
     regulations or standards regarding the storage, transport, 
     management, or other activities associated with the recycling 
     of scrap metal that the Administrator promulgates under the 
     Solid Waste Disposal Act subsequent to the enactment of this 
     section and with regard to transactions occurring after the 
     effective date of such regulations or standards; and
       ``(C) the person did not melt the scrap metal prior to the 
     transaction.
       ``(2) For purposes of paragraph (1)(C), melting of scrap 
     metal does not include the thermal separation of 2 or more 
     materials due to differences in their melting points 
     (referred to as `sweating').
       ``(3) For purposes of this subsection, the term `scrap 
     metal' means bits and pieces of metal parts (e.g., bars, 
     turnings, rods, sheets, wire) or metal pieces that may be 
     combined together with bolts or soldering (e.g., radiators, 
     scrap automobiles, railroad box cars), which when worn or 
     superfluous can be recycled, except for scrap metals that the 
     Administrator excludes from this definition by regulation.
       ``(e) Transactions Involving Batteries.--Transactions 
     involving spent lead-acid batteries, spent nickel-cadmium 
     batteries, or other spent batteries shall be deemed to be 
     arranging for recycling if the person who arranged for the 
     transaction (by selling recyclable material or otherwise 
     arranging for the recycling of recyclable material) can 
     demonstrate by a preponderance of the evidence that at the 
     time of the transaction--
       ``(1) the person met the criteria set forth in subsection 
     (c) with respect to the spent lead-acid batteries, spent 
     nickel-cadmium batteries, or other spent batteries, but the 
     person did not recover the valuable components of such 
     batteries; and
       ``(2)(A) with respect to transactions involving lead-acid 
     batteries, the person was in compliance with applicable 
     Federal environmental regulations or standards, and any 
     amendments thereto, regarding the storage, transport, 
     management, or other activities associated with the recycling 
     of spent lead-acid batteries;
       ``(B) with respect to transactions involving nickel-cadmium 
     batteries, Federal environmental regulations or standards are 
     in effect regarding the storage, transport, management, or 
     other activities associated with the recycling of spent 
     nickel-cadmium batteries, and the person was in compliance 
     with applicable regulations or standards or any amendments 
     thereto; or
       ``(C) with respect to transactions involving other spent 
     batteries, Federal environmental regulations or standards are 
     in effect regarding the storage, transport, management, or 
     other activities associated with the recycling of such 
     batteries, and the person was in compliance with applicable 
     regulations or standards or any amendments thereto.
       ``(f) Exclusions.--
       ``(1) The exemptions set forth in subsections (c), (d), and 
     (e) shall not apply if--
       ``(A) the person had an objectively reasonable basis to 
     believe at the time of the recycling transaction--
       ``(i) that the recyclable material would not be recycled;
       ``(ii) that the recyclable material would be burned as 
     fuel, or for energy recovery or incineration; or
       ``(iii) for transactions occurring before 90 days after the 
     date of the enactment of this section, that the consuming 
     facility was not in compliance with a substantive (not 
     procedural or administrative) provision of any Federal, 
     State, or local environmental law

[[Page S10433]]

     or regulation, or compliance order or decree issued pursuant 
     thereto, applicable to the handling, processing, reclamation, 
     or other management activities associated with the recyclable 
     material;
       ``(B) the person had reason to believe that hazardous 
     substances had been added to the recyclable material for 
     purposes other than processing for recycling;
       ``(C) the person failed to exercise reasonable care with 
     respect to the management and handling of the recyclable 
     material (including adhering to customary industry practices 
     current at the time of the recycling transaction designed to 
     minimize, through source control, contamination of the 
     recyclable material by hazardous substances); or
       ``(D) with respect to any item of a recyclable material, 
     the item contained polychlorinated biphenyls at a 
     concentration in excess of 50 parts per million or any new 
     standard promulgated pursuant to applicable Federal laws.
       ``(2) For purposes of this subsection, an objectively 
     reasonable basis for belief shall be determined using 
     criteria that include (but are not limited to) the size of 
     the person's business, customary industry practices 
     (including customary industry practices current at the time 
     of the recycling transaction designed to minimize, through 
     source control, contamination of the recyclable material by 
     hazardous substances), the price paid in the recycling 
     transaction, and the ability of the person to detect the 
     nature of the consuming facility's operations concerning its 
     handling, processing, reclamation, or other management 
     activities associated with the recyclable material.
       ``(3) For purposes of this subsection, a requirement to 
     obtain a permit applicable to the handling, processing, 
     reclamation, or other management activities associated with 
     recyclable material shall be deemed to be a substantive 
     provision.
       ``(g) Effect on Other Liability.--Nothing in this section 
     shall be deemed to affect the liability of a person under 
     paragraph (1) or (2) of section 107(a). Nothing in this 
     section shall be deemed to affect the liability of a person 
     under paragraph (3) or (4) of section 107(a) with respect to 
     materials that are not recyclable materials as defined in 
     subsection (b) of this section.
       ``(h) Regulations.--The Administrator has the authority, 
     under section 115, to promulgate additional regulations 
     concerning this section.
       ``(i) Effect on Pending or Concluded Actions.--The 
     exemptions provided in this section shall not affect any 
     concluded judicial or administrative action or any pending 
     judicial action initiated by the United States prior to 
     enactment of this section.
       ``(j) Liability for Attorney's Fees for Certain Actions.--
     Any person who commences an action in contribution against a 
     person who is not liable by operation of this section shall 
     be liable to that person for all reasonable costs of 
     defending that action, including all reasonable attorney's 
     and expert witness fees.
       ``(k) Relationship to Liability Under Other Laws.--Nothing 
     in this section shall affect--
       ``(1) liability under any other Federal, State, or local 
     statute or regulation promulgated pursuant to any such 
     statute, including any requirements promulgated by the 
     Administrator under the Solid Waste Disposal Act; or
       ``(2) the ability of the Administrator to promulgate 
     regulations under any other statute, including the Solid 
     Waste Disposal Act.''.
       (b) Technical Amendment.--The table of contents for title I 
     of such Act is amended by adding at the end the following 
     item:

  ``Sec. 127. Recycling transactions.''.

  Mrs. LINCOLN. Mr. President, I am pleased to join my distinguished 
colleagues in introducing legislation to relieve legitimate recyclers 
from Superfund liability.
  This legislation has become necessary because of an unintended 
consequence of the Comprehensive Emergency Response, Compensation, and 
Liability Act, more commonly called Superfund. Some courts have 
interpreted CERCLA to mean that the sale of certain traditional 
recyclable feedstocks is an arrangement for the treatment or disposal 
of a hazardous substance and, therefore, fully subject to Superfund 
liability. While there exists in law and legislative history no 
suggestion whatsoever that the Congress intended to impede recycling in 
America by providing a strong preference for the use of virgin 
materials through the Superfund liability scheme, that is precisely 
what has happened.
  The Superfund Recycling Equity Act of 1999 is intended to place 
traditional recyclable materials which are used as feedstocks in the 
manufacturing process on an equal footing with their virgin, or primary 
feedstock, counterparts. Traditional recyclables are made from paper, 
glass, plastic, metals, batteries, textiles, and rubber.
  During the 103rd Congress I first introduced a bill to relieve 
legitimate recyclers of scrap metal from unintended Superfund 
liability. The bill was developed in conjunction with the recycling 
industry, the environmental community, and the Administration. All of 
the parties worked closely together and consistently agreed that 
liability relief for recyclers is necessary and right.
  The language in this bill is the culmination of a process that we 
have been working on since the 103rd Congress. Similar language was 
also introduced in the 104th and 105th Congresses with the most recent 
version garnering almost 400 Senate and House co-sponsors. I am sure 
you can see, Mr. President, the push to relieve these legitimate 
recyclers of this unintended liability has received broad, bi-partisan 
support.
  The Superfund Recycling Equity Act of 1999 acknowledges that Congress 
did not intend to subject to Superfund liability those government and 
private entities that collect and process secondary materials for sale 
as feedstocks for manufacturing. This bill removes from liability those 
who collect, process, and sell to manufacturers paper, glass, plastic, 
metal textiles, and rubber recyclables. This bill also exempts from 
liability those individuals who collect lead acid, nickel, cadmium, and 
other batteries for the recycling of the valuable components. However, 
this bill does not exempt chemical, solvent, sludge, or slag recycling. 
It addresses traditional recyclables in a CERCLA context only. We do 
not intend it to be viewed as a precedent for any other amendment to 
Superfund or to any other environmental statute, whatsoever.
  It should also be clearly understood that this bill addresses the 
product of recyclers, that is the recyclables they sell which are 
utilized to make new products. This does not affect liability for 
contamination that is created at a facility owned or operated by a 
recycler. Neither does it affect liability related to any process 
wastes sent by a recycler for treatment or disposal. In order to assure 
that only bonafide recycling facilities benefit from this bill, a 
number of tests have been established within the bill by which 
liability relief will be denied to sham recyclers.
  I have consistently supported Superfund reforms beginning with my 
time in the House and continuing in the Senate. Unfortunately, 
comprehensive Superfund reforms have yet to garner broad support 
throughout the Congress and action on recyclers has been held up in the 
process. Relief for legitimate recyclers has been the one portion of 
Superfund reform that has consistently garnered widespread, bi-partisan 
support. The recycling industry should no longer be denied their 
legitimate exemption from Superfund liability because of broader issues 
that do not relate to them.
  Mr. President, I am aware of ongoing negotiations concerning a 
section within this recycling bill that applies to PCBs in paper. I 
want to again stress that when we began preparing for this bill in 
1993, we formed a coalition of parties that all agreed upon the 
language within the bill. This coalition has remained until this day. 
These parties are currently working to amend the language of the bill 
to resolve this concern. Upon final agreement, I will welcome an 
amendment to this bill to include the resolution language.
  Mr. President, there are legitimate recyclers across our nation that 
stand to lose their livelihoods if we don't act immediately. Legitimate 
recyclers that reuse and recycle the scrap leftover from our everyday 
processes. Legitimate recyclers that reduce the waste we put in our 
landfills and produce a useful product. Legitimate recyclers that were 
not intended by the writers of CERCLA to be burdened with liability for 
taking scrap metal and other products and processing them into products 
equivalent to virgin material.
  Mr. President, we have been working toward providing this needed 
liability relief for legitimate recyclers for over 6 years. It is time 
to pass this important legislation now. Doing so will not only relieve 
this unintended liability but will promote recycling in our country. I 
urge all my colleagues to join me in support of this legislation.
                                 ______