[Federal Register Volume 60, Number 127 (Monday, July 3, 1995)]
[Notices]
[Pages 34792-34798]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-16282]



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ENVIRONMENTAL PROTECTION AGENCY

[FRL-5252-1]


Announcement and Publication of Guidance on Agreements With 
Prospective Purchasers of Contaminated Property and Model Prospective 
Purchaser Agreement

SUMMARY: The new prospective purchaser guidance supersedes previous 
Agency policy on when the Agency will provide a covenant not to sue a 
prospective purchaser of contaminated property under CERCLA. Previous 
guidance, issued in June 1989, entitled ``Guidance on Landowner 
Liability under Section 107(a) of CERCLA, De Minimis Settlements under 
Section 122(g)(1)(B) of CERCLA, and Settlements with Prospective 
Purchasers of Contaminated Property'' (OSWER Directive No. 9835.9 and 
54 FR 34235 (Aug. 18, 1989), had two separate parts, including a model 
administrative order and a model consent decree for de minimis 
landowner settlements. The first part of the previous guidance, 
landowner liability/the innocent landowner defense and the Agency's use 
of de minimis landowner settlements including model agreements to use 
in such settlements remains Agency Policy. The section of the guidance 
dealing with prospective purchasers is changed by new guidance approved 
May 24, 1995.
    In an effort to promote cleanup for the beneficial reuse and 
development of contaminated properties, EPA is expanding the criteria 
by which it will consider entering into prospective purchaser 
agreements. EPA will consider such agreements if the agreement results 
in either (1) a substantial direct benefit to the Agency in terms of 
cleanup or funds for cleanup or (2) a substantial indirect benefit to 
the community coupled with a lesser direct benefit to the Agency. 
Additionally, the new guidance should enable the Agency to enter into 
more prospective purchaser agreements by expanding the universe of 
eligible sites. A model prospective purchaser agreement has also been 
developed and is part of the new guidance.

FOR FURTHER INFORMATION CONTACT: Additional information on the 
prospective purchaser policy is available from Lori Boughton ((703) 
603-8959) or Elisabeth Freed ((703) 603-8936) in the Office of Site 
Remediation Enforcement, 402 M St., S.W., 2273-G, Washington, D.C. 
20460. Information regarding the model prospective purchaser agreement 
and site specific prospective purchaser inquiries should be directed to 
Helen Keplinger ((202) 260-7116) in the Office of Site Remediation 
Enforcement, 401 M St. S.W., 2272, Washington, D.C. 20460.

    Dated: June 21, 1995.
Bruce M. Diamond,
Director, Office of Site Remediation Enforcement.
Memorandum

Subject: Guidance on Agreements with Prospective Purchasers of 
Contaminated Property

From: Steven A. Herman, Assistant Administrator, Office of 
Enforcement and Compliance Assurance

To: Regional Administrators, Regions I-X; Regional Counsel, Region 
I-X; Waste Management Division Directors, Regions I-X

    This memorandum transmits the guidance and model agreement 
concerning prospective purchasers of contaminated Superfund 
property. The attached guidance supersedes the Agency policy issued 
in June 1989, entitled ``Guidance on Landowner Liability under 
Section 107(a) of CERCLA, De Minimis Settlements under Section 
122(g)(1)(B) of CERCLA, and Settlements with Prospective Purchasers 
of Contaminated Property'' (OSWER Directive No. 9835.9 and 54 FR 
34235 (Aug. 18, 1989). The 1989 guidance limited the use of these 
covenants to situations where the Agency planned to take an 
enforcement action, and where the Agency received a substantial 
benefit for cleanup of the site by the purchaser, not otherwise 
available. In an effort to promote cleanup for the beneficial reuse 
and development of these properties, EPA is expanding the 
circumstances under which it will consider entering into prospective 
purchaser agreements.
    Additional information on this policy is available from Lori 
Boughton ((703) 603-8959) or Elisabeth Freed ((703) 603-8936) in the 
Office of Site Remediation Enforcement. Information regarding the 
model agreement and site specific inquiries should be directed to 
Helen Keplinger ((202) 260-7116) in the Office of Site Remediation 
Enforcement.
GUIDANCE ON SETTLEMENTS WITH PROSPECTIVE PURCHASERS OF CONTAMINATED 
PROPERTY

I. Purpose

    This document supersedes EPA's policy on agreements with 
prospective purchasers of contaminated property as set forth in the 
June 6, 1989, policy document entitled ``Guidance on 

[[Page 34793]]
Landowner Liability under Section 107(a) of CERCLA, De Minimis 
Settlements under Section 122(g)(1)(B) of CERCLA, and Settlements with 
Prospective Purchasers of Contaminated Property'' 1 (``the 1989 
guidance''). This revised guidance reflects both Agency experience in 
implementing the 1989 guidance and changes to that guidance that EPA 
believes are needed.

    \1\ OSWER Directive No. 9835.9 and 54 FR 34235 (Aug. 18, 1989).
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    During the past several years, EPA has entered into a number of 
prospective purchaser agreements to enable purchasers to buy 
contaminated property for cleanup, redevelopment or reuse. The 1989 
guidance required EPA to receive substantial benefits in terms of work 
or reimbursement of response costs that otherwise would not have been 
available. While some agreements required performance of cleanup work 
on contaminated parcels prior to their redevelopment, others provided 
covenants not to sue for purchase of uncontaminated portions of larger 
Superfund sites. EPA's experience has demonstrated that prospective 
purchaser agreements might be both appropriate and beneficial in more 
circumstances than contemplated by the 1989 guidance. The Agency now 
believes that it may be appropriate to enter into agreements resulting 
in somewhat reduced benefits to the Agency through cleanup or response 
costs or in benefits that also may be available from other parties. 
These agreements in turn should provide substantial benefits to the 
community through the creation or retention of jobs, productive use of 
abandoned property, or revitalization of blighted areas.
    While this new guidance restates much of the 1989 guidance, it 
revises two of the original criteria used to determine whether a 
prospective purchaser agreement is appropriate. The revised criteria 
allow the Agency greater flexibility to consider agreements with 
covenants not to sue to encourage reuse or development of contaminated 
property that would have substantial benefits to the community (e.g., 
through job creation or productive use of abandoned property), but also 
would be safe, consistent with site remediation, and have direct 
benefits to the Agency. A ``model'' prospective purchaser agreement, 
which should be used as a starting point for negotiation of agreements, 
is attached.

II. Statement of Policy

    Because of the clear liability which attaches to landowners who 
acquire property with knowledge of contamination, the Agency has 
received numerous requests for covenants not to sue from prospective 
purchasers of contaminated property.2 It is the Agency's policy 
not to become involved in private real estate transactions. However, an 
agreement with a covenant not to sue a prospective purchaser might 
appropriately be considered if it will have substantial benefits for 
the government and if the prospective purchaser satisfies other 
criteria.3

    \2\  Since settlements with typical prospective purchasers 
(i.e., those who do not currently own the property, are not 
otherwise involved with the site, and are, therefore, not yet liable 
under Section 107) will not be reached under Section 122, the 
procedures and restrictions in that section, such as those relating 
to covenants not to sue, will not apply.
    \3\ This guidance is also applicable to persons seeking 
prospectively to operate or lease contaminated property. Agreements 
with prospective lessees/operators will be evaluated using the 
criteria set forth in this guidance, and will require the current 
owner's signature.
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    The Agency recognizes that entering into an agreement containing a 
covenant not to sue with a prospective purchaser of contaminated 
property, given appropriate safeguards, may result in an environmental 
benefit through a payment for cleanup or a commitment to perform a 
response action. EPA's experience has shown that prospective purchaser 
agreements have also benefitted the community where the site is located 
by encouraging the reuse or redevelopment of property at which the fear 
of Superfund liability may have been a barrier. The Agency believes 
that it is necessary to provide greater flexibility in offering 
covenants not to sue. Through this guidance, the Agency adopts a policy 
which expands the circumstances under which prospective purchaser 
agreements may be considered.

III. Criteria for Entering Into Covenants Not To Sue With Prospective 
Purchasers of Contaminated Property

    The following criteria should be met before the Agency considers 
entering into agreements with prospective purchasers. These criteria 
are intended to reflect EPA's commitment to removing the barriers 
imposed by potential CERCLA liability while ensuring protection of 
human health and the environment. The Agency may also reject any offer 
if it determines that entering into an agreement with a prospective 
purchaser is not sufficiently in the public interest to warrant 
expending the resources necessary to reach an agreement. Regions should 
consider the following criteria when evaluating prospective purchaser 
agreements.
1. An EPA Action at the Facility Has Been Taken, Is Ongoing, or Is 
Anticipated To Be Undertaken by the Agency

    This criterion is meant to ensure that EPA does not become 
unnecessarily involved in purely private real estate transactions or 
expend its limited resources in negotiations which are unlikely to 
produce a sufficient benefit to the public. EPA, however, recognizes 
the potential gains in terms of clean up and public benefit that may be 
realized with broader application of prospective purchaser agreements. 
Therefore, this criterion has been expanded beyond the limitation in 
the 1989 guidance to sites where enforcement action is anticipated, to 
now include sites where federal involvement has occurred or is expected 
to occur.
    Accordingly, when requested, the Agency may consider entering into 
prospective purchaser agreements at sites listed or proposed for 
listing on the National Priorities List (NPL), or sites where EPA has 
undertaken, is undertaking, or plans to conduct a response action. If 
the Agency receives a request for a prospective purchaser agreement at 
a site where EPA has not yet become involved, Regions should first 
evaluate the realistic possibility that a prospective purchaser may 
incur Superfund liability when determining the appropriateness of 
entering into a prospective purchaser agreement. This evaluation should 
clearly show that EPA's covenant not to sue is essential to remove 
Superfund liability barriers and allow the private party cleanup and 
productive use, reuse, or redevelopment of the site.
    The Agency should consider the following factors when evaluating 
the appropriateness of entering into an agreement with a prospective 
purchaser at any site:
    a. Whether information regarding releases or potential releases of 
hazardous substances at the site indicates that there is a substantial 
likelihood of federal response or enforcement action at the site that 
would justify EPA's involvement in entering into the prospective 
purchaser agreement. EPA should consider information that is available 
through EPA's data systems, such as the Comprehensive Environmental 
Response, Compensation, and Liability Information System (``CERCLIS''), 
a state agency, or through submissions from the prospective purchaser, 
such as the results of an environmental audit or site assessment.
    b. Whether other available avenues (e.g., private indemnification 

[[Page 34794]]
    agreements) may exist to sufficiently alleviate the threat of Superfund 
liability at the site without the need for EPA involvement. In most 
cases EPA will decline to consider an agreement at a site that is 
currently undergoing cleanup through a state program, since future EPA 
activity at such a site is extremely unlikely.
    Prospective purchaser agreements generally will not be appropriate 
at sites screened out using the above criteria. For example, sites 
designated by EPA as No Further Response Action Planned (NFRAP) and 
removed from CERCLIS will rarely be deemed appropriate for a 
prospective purchaser agreement. Even at such sites, however, EPA may, 
in extremely unusual circumstances, consider a prospective purchaser 
agreement if it is in the public interest and the agreement is 
essential to achieve a very significant public benefit.

2. The Agency Should Receive a Substantial Benefit Either in the Form 
of a Direct Benefit for Cleanup, or as an Indirect Public Benefit in 
Combination With a Reduced Direct Benefit to EPA

    A cornerstone of the Agency's evaluation process under this policy 
is the measurement of environmental benefit, in the form of direct 
funding, or cleanup, or a combination of reduced direct funding or 
cleanup and an indirect public benefit. The Agency believes that its 
past practice of limiting prospective purchaser agreements to those 
situations where substantial benefit was measured only in terms of cost 
reimbursement or work performed may have decreased the effectiveness of 
this tool.
    This guidance encourages a more balanced evaluation of both the 
direct and indirect benefits of a prospective purchaser agreement to 
the government and the public. EPA recognizes that indirect benefits to 
a community is an important consideration and may justify the 
commitment of the Agency's resources necessary to negotiate a 
prospective purchaser agreement, even where there are reduced direct 
benefits to the Agency in terms of cleanup and cost reimbursement.
    Therefore, EPA may continue to consider entering into prospective 
purchaser agreements where there is a substantial direct benefit to EPA 
in terms of a commitment to conduct the cleanup or to reimburse EPA's 
cost of cleanup. Furthermore, Regions may now consider negotiating 
prospective purchaser agreements that will result in substantial 
indirect benefits to the community as long as there is still some 
direct benefit to the Agency. Both direct and indirect benefits should 
be measurable to enable EPA to evaluate them effectively and to ensure 
they are substantial. Examples of indirect benefits to the community 
include measures that serve to reduce substantially the risk posed by 
the site, creation or retention of jobs, development of abandoned or 
blighted property, creation of conservation or recreation areas, or 
provision of community services (such as improved public transportation 
and infrastructure.) Examples of reduced but measurable benefits to EPA 
include partial cleanup or compensation.
    While this policy is intended to provide greater flexibility in 
providing prospective purchaser agreements, EPA is not reducing its 
commitment to environmental protection or environmental justice. The 
Agency intends to carefully weigh the public interest considerations of 
creating jobs in the inner city, where older contaminated industrial 
properties are often located, against the possibility of further 
environmental degradation of industrial property in mixed industrial/
residential areas. EPA is committed to working with purchasers of such 
property, to the extent possible, to ensure proper cleanup and promote 
responsible land use.

3. The Continued Operation of the Facility or New Site Development, 
With the Exercise of Due Care, Will Not Aggravate or Contribute to the 
Existing Contamination or Interfere With EPA's Response Action

    Information which should be considered by the Agency to evaluate 
the effect of new site development or continued operation of the 
facility could include site assessment data and the Engineering 
Evaluation Cost Analysis (EE/CA) or remedial investigation/feasibility 
study (RI/FS), if available, and all other information relevant to the 
condition of the facility. If the prospective purchaser intends to 
continue the operations of an existing facility, the prospective 
purchaser should submit information sufficient to allow the Agency to 
determine whether the continued operations are likely to aggravate or 
contribute to the existing contamination or interfere with the remedy. 
If the prospective purchaser plans to undertake new operations or 
development of the property, comprehensive information regarding these 
plans should be provided to EPA. If the planned activities of the 
prospective purchaser are likely to aggravate or contribute to the 
existing contamination or generate new contamination, EPA generally 
will not enter into an agreement, or will include restrictions in the 
agreement which prohibit those operations or portions of those 
operations which are likely to aggravate or contribute to the existing 
contamination or interfere with the remedy.
    The Agency will determine on a case-by-case basis whether the 
available information is sufficient for purposes of this evaluation. 
One key factor to be considered is whether the remedial investigation 
or other site evaluation has been completed and the extent of 
information which has been generated in that process. EPA may not enter 
into an agreement if the available information is insufficient for 
purposes of evaluating the impact of the proposed activities.

4. The Continued Operation or New Development of the Property Will Not 
Pose Health Risks to the Community and Those Persons Likely To Be 
Present at the Site

    EPA believes it is important to consider the environmental 
implications of site operations on the surrounding community and to 
those likely to be present or have access to the site.

5. The Prospective Purchaser Is Financially Viable
    A settling party, including a prospective purchaser of contaminated 
property, should demonstrate that it is financially viable and capable 
of fulfilling any obligation under the agreement. In appropriate 
circumstances, EPA may structure payment or work to be performed to 
avoid or minimize an undue financial burden on the purchaser.

IV. Consideration

    As a matter of law, it is necessary for EPA to obtain adequate 
consideration when entering into a prospective purchaser agreement. In 
determining what constitutes adequate consideration, Regions should 
consider a number of factors. Initially, Regions should examine the 
amount of past and future response costs expected to be incurred at the 
site, whether there are other potentially responsible parties who can 
perform the work or reimburse EPA's costs, and whether there is likely 
to be a shortfall in recovery of costs at the site. Regions should then 
consider the purchase price to be paid by the prospective purchaser, 
the market value of the property, the value of any lien on the property 
under Section 107(1) of CERCLA, whether the purchaser is paying a 
reduced price due to the condition of the property, and if so, the 
likely increase in the value of the 

[[Page 34795]]
property attributable to the cleanup (e.g. compare purchase price or 
market price with the estimated value of the property following 
completion of the response action). Finally, Regions should consider 
the size and nature of the prospective purchaser and the proposed use 
of the site (e.g. whether the purchaser is a large commercial or 
industrial venture, a small business, a non-profit or community-based 
activity). The analysis of any benefits received by the Agency also 
should contemplate any projected ``windfall'' profit to the purchaser 
when the government has unreimbursed response costs, and whether it is 
appropriate to include in the agreement some provision to recoup such 
costs. This analysis should be coupled with an examination of any 
indirect benefit that the Agency may receive (e.g., demolition of 
structures, implementation of institutional controls) in determining 
whether a prospective purchaser agreement provides a substantial 
benefit.

V. Public Participation

    In light of EPA's new policy of accepting indirect public benefit 
as partial consideration, and the fact that the prospective purchaser 
agreements will provide contribution protection to the purchaser, the 
surrounding community and other members of the public should be 
afforded opportunity to comment on the settlement, wherever feasible. 
Because settlements with prospective purchasers are not expressly 
governed by CERCLA Section 122, there is no legal requirement for 
public notice and comment. Whenever practicable, however, Regions 
should publish notices in the Federal Register to ensure adequate 
notification of the agreement to all interested parties. Notice of a 
proposed settlement, in the Federal Register alone, however, will 
rarely be sufficient to appropriately involve a community in the 
process concerning an agreement with a prospective purchaser. 
Particularly in urban communities and at facilities where environmental 
justice is an issue, Regions should provide sufficient opportunities 
for public information dissemination and facilitate public input. 
Seeking cooperation with state and local government may also facilitate 
public awareness and involvement. Additionally, Regions should make a 
case-by-case determination of the need and level of additional measures 
to ensure meaningful community involvement with respect to the 
agreement. Because of business considerations some prospective 
purchaser agreements may be subject to relatively short deadlines. In 
these circumstances, Regions should allow sufficient time for 
appropriate approvals and public comment prior to the deadline.

VI. Process

    A mandatory consultation with the Director of the Regional Support 
Division, Office of Site Remediation Enforcement, is required for any 
agreement entered with a prospective purchaser of contaminated 
property. Any prospective purchaser agreement can only be entered into 
with the express concurrence of the Assistant Attorney General. It is 
important that Regions involve EPA Headquarters and the Department of 
Justice at an early point in the process, and keep them involved 
throughout the negotiations. In particular, any draft settlement 
document should be forwarded to Headquarters and the Department of 
Justice prior to being sent to a prospective purchaser. When seeking 
approval for a settlement, it is important to explain the consideration 
for the covenant not to sue, whether direct or a combination of direct 
and indirect benefits, how it was determined, and why the Region 
considers it to be adequate.
    This guidance and any internal procedures adopted for its 
implementation are intended solely as guidance for employees of the 
U.S. Environmental Protection Agency and creates no substantive rights 
in any persons. Case specific inquiry should be directed to the 
Regional Support Division. Additional information on this policy is 
available from Lori Boughton ((703) 603-8959), Elisabeth Freed ((703) 
603-8936) in the Policy and Program Evaluation Division, and Helen 
Keplinger ((202) 260-7116) in the Regional Support Division.
Region ______

    In the matter of: [name] [Docket Number] under the authority of 
the Comprehensive Environmental Response, Compensation, and 
Liability Act of 1980, 42 U.S.C. 9601, et seq., as amended. [state 
law, if appropriate] Agreement and Covenant Not To Sue [Insert 
Settling Respondent's Name]

I. Introduction

    This Agreement and Covenant Not to Sue (``Agreement'') is made and 
entered into by and between the United States Environmental Protection 
Agency (``EPA'') [state of ______] and __________ [insert name of 
Settling Respondent] (collectively the ``Parties'').
    EPA enters into this Agreement pursuant to the Comprehensive 
Environmental Response, Compensation, and Liability Act of 1980, as 
amended (``CERCLA''), 42 U.S.C. Sec. 9601, et seq. [If the state is a 
party, insert ``The State of __________, enters into this Agreement 
pursuant to [cite relevant state authority.]'' and make appropriate 
reference to state with respect to affected provisions, including 
payment or work to be performed].
    [Provide introductory information, consistent with Definitions and 
Statement of Facts, about the party purchasing the contaminated 
property including, name (``Settling Respondent''), address, corporate 
status if applicable and include proposed use of the property by 
prospective purchaser. Provide name, location and description of Site.]
    The Parties agree to undertake all actions required by the terms 
and conditions of this Agreement. The purpose of this Agreement is to 
settle and resolve, subject to reservations and limitations contained 
in Sections VII, VIII, IX, and X [If this Agreement contains a separate 
section for Settling Respondent's reservations, add section number], 
the potential liability of the Settling Respondent for the Existing 
Contamination at the Property which would otherwise result from 
Settling Respondent becoming the owner of the property.
    The Parties agree that the Settling Respondent's entry into this 
Agreement, and the actions undertaken by the Settling Respondent in 
accordance with the Agreement, do not constitute an admission of any 
liability by the Settling Respondent.
    The resolution of this potential liability, in exchange for 
provision by the Settling Respondent to EPA [and the state] of a 
substantial benefit, is in the public interest.

II. Definitions

    Unless otherwise expressly provided herein, terms used in this 
Agreement which are defined in CERCLA or in regulations promulgated 
under CERCLA shall have the meaning assigned to them in CERCLA or in 
such regulations, including any amendments thereto.
    1. ``EPA'' shall mean the United States Environmental Protection 
Agency and any successor departments or agencies of the United States.
    2. ``Existing Contamination'' shall mean any hazardous substances, 
pollutants or contaminants, present or existing on or under the Site as 
of the effective date of this Agreement.
    3. ``Parties'' shall mean EPA, [State of __________], and the 
Settling Respondent.
    4. ``Property'' shall mean that portion of the Site which is 
described in Exhibit 1 of this Agreement. 

[[Page 34796]]

    5. ``Settling Respondent'' shall mean __________.
    6. ``Site'' shall mean the [Superfund] Site, encompassing 
approximately __________ acres, located at [address or description of 
location] in [name of city, county, and State], and depicted generally 
on the map attached as Exhibit 2. The Site shall include the Property, 
and all areas to which hazardous substances and/or pollutants or 
contaminants, have come to be located [provide a more specific 
definition of the Site where possible; may also wish to include within 
Site description structures, USTs, etc].
    7. ``United States'' shall mean the United States of America, its 
departments, agencies, and instrumentalities.

III. Statement of Facts

    8. [Include only those facts relating to the Site that are relevant 
to the covenant being provided the prospective purchaser. Avoid adding 
information that relates only to actions or parties that are outside of 
this Agreement.]
    9. The Settling Respondent represents, and for the purposes of this 
Agreement EPA [and the state] relies on those representations, that 
Settling Respondent's involvement with the Property and the Site has 
been limited to the following: [Provide facts of any involvement by 
Settling Respondent with the Site, for example performing an 
environmental audit, or if Settling Respondent has had no involvement 
with the Site so state.].

IV. Payment

    10. In consideration of and in exchange for the United States' 
Covenant Not to Sue in Section VIII herein [and Removal of Lien in 
Section XXI herein if that is part of the consideration for the 
agreement], Settling Respondent agrees to pay to EPA the sum of 
$__________, within ______ days of the effective date of this 
Agreement. [A separate section should be added if the consideration is 
work to be performed.] The Settling Respondent shall make all payments 
required by this Agreement in the form of a certified check or checks 
made payable to ``EPA Hazardous Substance Superfund,'' referencing the 
EPA Region, EPA Docket number, and Site/Spill ID#________ [insert 4-
digit no.; first 2 numbers represent Region, second 2 numbers are 
Region's Site/Spill ID no.], [DOJ case number ______, if applicable] 
and name and address of Settling Respondent. [insert Regional Superfund 
Lockbox address where payment should be sent]. Notice of payment shall 
be sent to those persons listed in Section XV (Notices and Submissions) 
and to EPA Region ______ Financial Management Officer [insert address].
    11. Amounts due and owing pursuant to the terms of this Agreement 
but not paid in accordance with the terms of this Agreement shall 
accrue interest at the rate established pursuant to Section 107(a) of 
CERCLA, 42 U.S.C. 9607(a), compounded on an annual basis.

[______.] [Work To Be Performed]
    [Include this section and other appropriate provisions relating to 
performance of the work, such as financial assurance, agency approvals, 
reporting, etc., where work to be performed is the consideration for 
the Agreement.
    ______. Statement of Work attached as Exhibit 3.]

V. Access/Notice to Successors in Interest

    12. Commencing upon the date that it acquires title to the 
Property, Settling Respondent agrees to provide to EPA [and the state] 
its authorized officers, employees, representatives, and all other 
persons performing response actions under EPA [or state] oversight, an 
irrevocable right of access at all reasonable times to the Property and 
to any other property to which access is required for the 
implementation of response actions at the Site, to the extent access to 
such other property is controlled by the Settling Respondent, for the 
purposes of performing and overseeing response actions at the Site 
under federal [and state] law. EPA agrees to provide reasonable notice 
to the Settling Respondent of the timing of response actions to be 
undertaken at the Property. Notwithstanding any provision of this 
Agreement, EPA retains all of its authorities and rights, including 
enforcement authorities related thereto, under CERCLA, the Solid Waste 
Disposal Act, as amended by the Resource Conservation and Recovery Act, 
42 U.S.C. 6901, (``RCRA'') et seq., and any other applicable statute or 
regulation, including any amendments thereto.
    13. Within 30 days after the effective date of this Agreement, the 
Settling Respondent shall record a certified copy of this Agreement 
with the Recorder's Office [or Registry of Deeds or other appropriate 
office], __________ County, State of __________. Thereafter, each deed, 
title, or other instrument conveying an interest in the Property shall 
contain a notice stating that the Property is subject to this 
Agreement. A copy of these documents should be sent to the persons 
listed in Section XV (Notices and Submissions).
    14. The Settling Respondent shall ensure that assignees, successors 
in interest, lessees, and sublessees, of the Property shall provide the 
same access and cooperation. The Settling Respondent shall ensure that 
a copy of this Agreement is provided to any current lessee or sublessee 
on the Property as of the effective date of this Agreement and shall 
ensure that any subsequent leases, subleases, assignments or transfers 
of the Property or an interest in the Property are consistent with this 
Section, and Section XI (Parties Bound/Transfer of Covenant), of the 
Agreement [and where appropriate, Section ______ (Work to be 
Performed)].

VI. Due Care/Cooperation

    15. The Settling Respondent shall exercise due care at the Site 
with respect to the Existing Contamination and shall comply with all 
applicable local, State, and federal laws and regulations. The Settling 
Respondent recognizes that the implementation of response actions at 
the Site may interfere with the Settling Respondent's use of the 
Property, and may require closure of its operations or a part thereof. 
The Settling Respondent agrees to cooperate fully with EPA in the 
implementation of response actions at the Site and further agrees not 
to interfere with such response actions. EPA agrees, consistent with 
its responsibilities under applicable law, to use reasonable efforts to 
minimize any interference with the Settling Respondent's operations by 
such entry and response. In the event the Settling Respondent becomes 
aware of any action or occurrence which causes or threatens a release 
of hazardous substances, pollutants or contaminants at or from the Site 
that constitutes an emergency situation or may present an immediate 
threat to public health or welfare or the environment, Settling 
Respondent shall immediately take all appropriate action to prevent, 
abate, or minimize such release or threat of release, and shall, in 
addition to complying with any applicable notification requirements 
under Section 103 of CERCLA, 42 U.S.C. 9603, or any other law, 
immediately notify EPA of such release or threatened release.

VII. Certification

    16. By entering into this agreement, the Settling Respondent 
certifies that to the best of its knowledge and belief it has fully and 
accurately disclosed to EPA [and the state] all information known to 
Settling Respondent and all information in the possession or control of 
its officers, directors, employees, 

[[Page 34797]]
contractors and agents which relates in any way to any Existing 
Contamination or any past or potential future release of hazardous 
substances, pollutants or contaminants at or from the Site and to its 
qualification for this Agreement. The Settling Respondent also 
certifies that to the best of its knowledge and belief it has not 
caused or contributed to a release or threat of release of hazardous 
substances or pollutants or contaminants at the Site. If the United 
States [and the state] determines that information provided by Settling 
Respondent is not materially accurate and complete, the Agreement, 
within the sole discretion of the United States, shall be null and void 
and the United States [and the state] reserves all rights it [they] may 
have.
VIII. United States' Covenant Not To Sue 4

    17. Subject to the Reservation of Rights in Section IX of this 
Agreement, upon payment of the amount specified in Section IV 
(Payment), of this Agreement [if consideration for Agreement is work to 
be performed, insert, as appropriate, ``and upon completion of the work 
specified in Section ______ (Work to Be Performed) to the satisfaction 
of EPA''], the United States [and the state] covenants not to sue or 
take any other civil or administrative action against Settling 
Respondent for any and all civil liability for injunctive relief or 
reimbursement of response costs pursuant to Sections 106 or 107(a) of 
CERCLA, 42 U.S.C. 9606 or 9607(a) [and state law cite] with respect to 
the Existing Contamination.

    \4\ Since the covenant not to sue is from the United States, 
Regions negotiating these Agreements should advise the Department of 
Justice of any other federal agency involved with the Site, or which 
may have a claim under CERCLA with respect to the Site and use best 
efforts to advise such federal agency of the proposed settlement.
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IX. Reservation of Rights

    18. The covenant not to sue set forth in Section VIII above does 
not pertain to any matters other than those expressly specified in 
Section VIII (United States' Covenant Not to Sue). The United States 
[and the State] reserves and the Agreement is without prejudice to all 
rights against Settling Respondent with respect to all other matters, 
including but not limited to, the following:
    (a) claims based on a failure by Settling Respondent to meet a 
requirement of this Agreement, including but not limited to Section IV 
(Payment), Section V (Access/Notice to Successors in Interest), Section 
VI (Due Care/Cooperation), Section XIV (Payment of Costs, [and, if 
appropriate, Section ______ (Work to be Performed)];
    (b) any liability resulting from past or future releases of 
hazardous substances, pollutants or contaminants, at or from the Site 
caused or contributed to by Settling Respondent, its successors, 
assignees, lessees or sublessees;
    (c) any liability resulting from exacerbation by Settling 
Respondent, its successors, assignees, lessees or sublessees, of 
Existing Contamination;
    (d) any liability resulting from the release or threat of release 
of hazardous substances, pollutants or contaminants, at the Site after 
the effective date of this Agreement, not within the definition of 
Existing Contamination;
    (e) criminal liability;
    (f) liability for damages for injury to, destruction of, or loss of 
natural resources, and for the costs of any natural resource damage 
assessment incurred by federal agencies other than EPA; and
    (g) liability for violations of local, State or federal law or 
regulations.
    19. With respect to any claim or cause of action asserted by the 
United States [or the state], the Settling Respondent shall bear the 
burden of proving that the claim or cause of action, or any part 
thereof, is attributable solely to Existing Contamination.
    20. Nothing in this Agreement is intended as a release or covenant 
not to sue for any claim or cause of action, administrative or 
judicial, civil or criminal, past or future, in law or in equity, which 
the United States [or the state] may have against any person, firm, 
corporation or other entity not a party to this Agreement.
    21. Nothing in this Agreement is intended to limit the right of EPA 
[or the state] to undertake future response actions at the Site or to 
seek to compel parties other than the Settling Respondent to perform or 
pay for response actions at the Site. Nothing in this Agreement shall 
in any way restrict or limit the nature or scope of response actions 
which may be taken or be required by EPA [or the state] in exercising 
its authority under federal [or state] law. Settling Respondent 
acknowledges that it is purchasing property where response actions may 
be required.

X. Settling Respondent's Covenant Not To Sue

    22. In consideration of the United States' Covenant Not To Sue in 
Section VIII of this Agreement, the Settling Respondent hereby 
covenants not to sue and not to assert any claims or causes of action 
against the United States [or the state], its authorized officers, 
employees, or representatives with respect to the Site or this 
Agreement, including but not limited to, any direct or indirect claims 
for reimbursement from the Hazardous Substance Superfund established 
pursuant to the Internal Revenue Code, 26 U.S.C. Sec. 9507, through 
CERCLA Sections 106(b)(2), 111, 112, 113, or any other provision of 
law, any claim against the United States, including any department, 
agency or instrumentality of the United States under CERCLA Sections 
107 or 113 related to the Site, or any claims arising out of response 
activities at the Site, including claims based on EPA's oversight of 
such activities or approval of plans for such activities.
    23. The Settling Respondent reserves, and this Agreement is without 
prejudice to, actions against the United States based on negligent 
actions taken directly by the United States, not including oversight or 
approval of the Settling Respondent's plans or activities, that are 
brought pursuant to any statute other than CERCLA or RCRA and for which 
the waiver of sovereign immunity is found in a statute other than 
CERCLA or RCRA. Nothing herein shall be deemed to constitute 
preauthorization of a claim within the meaning of Section 111 of 
CERCLA, 42 U.S.C. 9611, or 40 CFR 300.700(d).
XI. Parties Bound/Transfer of Covenant

    24. This Agreement shall apply to and be binding upon the United 
States, [and the state], and shall apply to and be binding on the 
Settling Respondent, its officers, directors, employees, and agents. 
Each signatory of a Party to this Agreement represents that he or she 
is fully authorized to enter into the terms and conditions of this 
Agreement and to legally bind such Party.
    25. Notwithstanding any other provisions of this Agreement, all of 
the rights, benefits and obligations conferred upon Settling Respondent 
under this Agreement may be assigned or transferred to any person with 
the prior written consent of EPA [and the state] in its sole 
discretion.
    26. The Settling Respondent agrees to pay the reasonable costs 
incurred by EPA [and the state] to review any subsequent requests for 
consent to assign or transfer the Property.
    27. In the event of an assignment or transfer of the Property or an 
assignment or transfer of an interest in the Property, the assignor or 
transferor shall continue to be bound by all the terms and conditions, 
and subject to all the benefits, of this Agreement except as EPA [the 
state] and the assignor or transferor agree otherwise and modify 

[[Page 34798]]
this Agreement, in writing, accordingly. Moreover, prior to or 
simultaneous with any assignment or transfer of the Property, the 
assignee or transferee must consent in writing to be bound by the terms 
of this Agreement including but not limited to the certification 
requirement in Section VII of this Agreement in order for the Covenant 
Not to Sue in Section VIII to be available to that party. The Covenant 
Not To Sue in Section VIII shall not be effective with respect to any 
assignees or transferees who fail to provide such written consent to 
EPA [and the state].

XII. Disclaimer

    28. This Agreement in no way constitutes a finding by EPA [or the 
state] as to the risks to human health and the environment which may be 
posed by contamination at the Property or the Site nor constitutes any 
representation by EPA [or the state] that the Property or the Site is 
fit for any particular purpose.

XIII. Document Retention

    29. The Settling Respondent agrees to retain and make available to 
EPA [and the state] all business and operating records, contracts, site 
studies and investigations, and documents relating to operations at the 
Property, for at least ten years, following the effective date of this 
Agreement unless otherwise agreed to in writing by the Parties. At the 
end of ten years, the Settling Respondent shall notify EPA [and the 
state] of the location of such documents and shall provide EPA [and the 
state] with an opportunity to copy any documents at the expense of EPA 
[or the state]. [Where work is to be performed, consider providing for 
document retention for ten years or until completion of work to the 
satisfaction of EPA, whichever is longer.]

XIV. Payment of Costs

    30. If the Settling Respondent fails to comply with the terms of 
this Agreement, including, but not limited to, the provisions of 
Section IV (Payment), [or Section______ (Work to be Performed)] of this 
Agreement, it shall be liable for all litigation and other enforcement 
costs incurred by the United States [and the state] to enforce this 
Agreement or otherwise obtain compliance.

XV. Notices and Submissions

    31. [Insert names, titles, and addresses of those to whom notices 
and submissions are due, specifying which submissions are required.]

XVI. Effective Date

    32. The effective date of this Agreement shall be the date upon 
which EPA issues written notice to the Settling Respondent that EPA 
[and the state] has fully executed the Agreement after review of and 
response to any public comments received.

XVII. Attorney General Approval

    33. The Attorney General of the United States or her designee has 
issued prior written approval of the settlement embodied in this 
Agreement.

XVIII. Termination

    34. If any Party believes that any or all of the obligations under 
Section V (Access/Notice to Successors in Interest) are no longer 
necessary to ensure compliance with the requirements of the Agreement, 
that Party may request in writing that the other Party agree to 
terminate the provision(s) establishing such obligations; provided, 
however, that the provision(s) in question shall continue in force 
unless and until the party requesting such termination receives written 
agreement from the other party to terminate such provision(s).

XIX. Contribution Protection

    35. With regard to claims for contribution against Settling 
Respondent, the Parties hereto agree that the Settling Respondent is 
entitled to protection from contribution actions or claims as provided 
by CERCLA Section 113(f)(2), 42 U.S.C. 9613(f)(2) for matters addressed 
in this Agreement. The matters addressed in this Agreement are [all 
response actions taken or to be taken and response costs incurred or to 
be incurred by the United States or any other person for the Site with 
respect to the Existing Contamination].
    36. The Settling Respondent agrees that with respect to any suit or 
claim for contribution brought by it for matters related to this 
Agreement it will notify the United States [and the state] in writing 
no later than 60 days prior to the initiation of such suit or claim.
    37. The Settling Respondent also agrees that with respect to any 
suit or claim for contribution brought against it for matters related 
to this Agreement it will notify in writing the United States [and the 
state] within 10 days of service of the complaint on them.

XX. Exhibits

    38. Exhibit 1 shall mean the description of the Property which is 
the subject of this Agreement.
    39. Exhibit 2 shall mean the map depicting the Site.
    [______. Exhibit 3 shall mean the Statement of Work.]

XXI. Removal of Lien

    40. [Use this provision only when appropriate.] Subject to the 
Reservation of Rights in Section IX of this Agreement, upon payment of 
the amount specified in Section IV (Payment) [or upon satisfactory 
completion of work to be performed specified in Section ______ (Work to 
be Performed)], EPA agrees to remove any lien it may have on the 
Property under Section 107(l) of CERCLA, 42 U.S.C. 9607(l), as a result 
of response action conducted by EPA at the Property.

XXII. Public Comment

    41. This Agreement shall be subject to a thirty-day public comment 
period, after which EPA may modify or withdraw its consent to this 
Agreement if comments received disclose facts or considerations which 
indicate that this Agreement is inappropriate, improper or inadequate.

It is So Agreed:
United States Environmental Protection Agency
By:

----------------------------------------------------------------------
Regional Administrator, Region ______      Date

It is So Agreed:
By:

----------------------------------------------------------------------
Name      Date

[FR Doc. 95-16282 Filed 6-30-95; 8:45 am]
BILLING CODE 6560-50-P