United States: Getting Down To Business: EPA's Superfund Task Force Report Seeks To Streamline And Rejuvenate The Program

Introduction

On July 25, 2017, the EPA Superfund Task Force convened by Administrator Scott Pruitt issued a broad array of recommendations for streamlining and rejuvenating the Superfund process.¹ The Task Force's recommendations prioritized expediting the cleanup of complex or highly contaminated sites, expanding private sector involvement in cleanups, and identifying opportunities to link remediation and redevelopment with innovative brownfields initiatives that will return contaminated property to productive use. While several of the recommendations by the Task Force only set the stage for further actions, the report provides a clear statement of this Administration's priorities for Superfund, and a road map of the direction the Agency is likely to take in the future. Moreover, Administrator Pruitt simultaneously released a memorandum (Pruitt Memo) directing the Agency to expeditiously implement eleven specific actions based on the Task Force's Recommendations and priorities.²

The Task Force Recommendations are organized around 5 overarching goals: (i) expediting cleanup and remediation; (ii) re-invigorating responsible party cleanup and reuse, (iii) encouraging private investment; (iv) promoting redevelopment and community relations; and (v) engaging partners and stakeholders.³

While the Task Force recommendations address a wide range of CERCLA policy issues, the report as a whole is most significant for its emphasis on several broad themes: expediting and streamlining the remediation and reuse process, expanding the private sector role in site cleanup, and encouraging site redevelopment.

Expediting the Remediation of Contaminated Sites

Several Task Force recommendations focus on expediting the remediation process, to try to prevent "years of study to delay addressing immediate risks."⁴ For example, Recommendation 1 calls for identifying a national "Top 10" list of NPL sites to receive special attention from the Administrator to identify and address any obstacles to expeditious cleanup and reuse.⁵ This kind of direct attention from the Office of the Administrator to the details of complex site remediation represents a major shift from the traditional EPA oversight of contaminated sites, generally conducted at the regional level. This recommendation is consistent with the Administrator's decision in May 2017 to withdraw authority from the Regions to make decisions on remedies exceeding $50 million and to retain that authority with the Administrator⁶, and suggests that EPA headquarters intends to play a significant role in remedy selection and oversight, particularly for complex contaminated sites.

The Task Force also proposed several other measures intended to expedite remediation over what can often be a years-long process of investigation and evaluation. These measures include greater use of early or interim response actions, and increased focus of Agency resources on priority NPL sites.⁷ One particularly important Task Force recommendation, identified by the Pruitt Memo as subject to immediate implementation, is a directive that EPA pursue an expanded use of adaptive management strategies, particularly at sediment sites.⁸ These adaptive management strategies often focus on implementing a remedy in stages by addressing the most important remediations first and assessing its effectiveness before moving on to secondary stages of remediation. In our experience, this approach offers a welcome alternative to decades-long studies and unachievable billion-dollar remedies that often plague today's complex sediment sites. While EPA guidance has long called for use of adaptive management, EPA regions have been slow and inconsistent in actually applying this guidance.

The Task Force recommendations also suggest an EPA openness to achieving site remediation through alternatives to Superfund. Recommendation 13 calls for exploring other federal statutes and greater use of states as the lead agencies to address NPL sites.⁹ Recommendation 14 calls for expanded use of EPA Special Accounts as financial incentives to PRPs to expedite site cleanups.¹⁰ This recommendation, to be elaborated in further guidance and directives, could signal a greater federal stake in PRP-led cleanups. Such a move would be consistent with Pruitt's recent praise for the Great Lakes Legacy Act program, which in our experience, provides an effective framework for contaminated site remediation, in part due to the greater federal stake in the outcomes of projects funded in part with federal funds.

Expanding Private Sector Involvement

In addition to expediting remediation, The Task Force focused on the rejuvenation of federal tools designed to expand the role that private sector real estate developers and other non-PRPs may play in the cleanup and redevelopment of contaminated sites. The Task Force explained that EPA needs to develop mechanisms to provide more support to contractual arrangements between PRPs and third parties seeking to remediate sites, such as risk transfer contractors, asserting that such arrangements can "help expedite the cleanup and reuse of a site."¹¹ The Task Force calls for "innovative approaches to promote third-party investment in cleanup and reuse of contaminated properties," suggesting that the Agency may need to consider "mitigating its retained rights" where promoting third party investment can expedite remediation.¹²

In all, the Task Force made 11 specific recommendations related to the goal of "Encouraging Private Investment". These include strengthening the Agency's tools to address liability concerns of third parties seeking to acquire and redevelop contaminated properties, expanding the use of Prospective Purchaser Agreements, revising the Agency's model Comfort Letters, and developing polices to encourage greater private financing of transactions involving contaminated sites.¹³ The Task Force also called for creating a national work group to identify "creative uses of insurance, annuities, indemnification, and other tools for third parties interested in buying/selling the risk of cleanup."¹⁴ Considered cumulatively, the Task Force recommendations suggest a major revitalization of the Brownfields program and an evaluation of whether changes in EPA's policies will rejuvenate lenders, insurance markets, risk-transfer arrangements, and other types of financial mechanisms that facilitate PRPs or third parties moving forward with remediation and redevelopment.

Promoting Redevelopment

Similarly, the Task Force also emphasized several initiatives to support State, local, and tribal governments in revamping the cleanup process to spur economic redevelopment. The Task Force took special note of the need to involve local economic development officials early in the remediation process so that economic development needs are incorporated in the front end of remedy decisions.

The recommendations to enhance redevelopment include identifying and prioritizing the 20 NPL sites with the greatest potential for redevelopment and reuse and trying to involve private sector entities in these sites; enhancing the information and data tools EPA makes available that would support community reuse of NPL sites; providing greater training and resources to EPA staff and local governments on the tools and strategies available to enhance reuse of NPL sites; and partnering with other federal agencies to coordinate redevelopment efforts.¹⁵ These initiatives all envision an approach to remediation that is driven, at least in part, by the question of how to return a contaminated property to productive final use—a question that is often part of state brownfields programs, but rarely given much consideration historically in the Superfund context.

Next Steps

The Task Force recommendations come at a time when EPA has been subject to mounting criticism for its failure to manage the Superfund program effectively. In 2016, the House Committee on Energy and Commerce convened a CERCLA oversight hearing to evaluate the effectiveness of the CERCLA program, where one witness asserted that EPA's failure to follow appropriate Agency guidance and regulations is "significantly delaying remediation of impacted sites and the redevelopment of our nation's waterways."¹⁶ In October of 2016, the US Government Accountability Office issued a report identifying numerous issues in EPA's oversight of the remediation of sediment sites.¹⁷ Earlier this year, the American Council of Engineering Companies issued a report noting, among other things, a slower pace in cleanup progress over the last several years.¹⁸Administrator Pruitt appears to be taking these concerns seriously.

Many of the Task Force recommendations show promise to expedite the cleanup and reuse of contaminated sites. For example, adaptive management and similar tools can avoid decades-long investigations by focusing on the most urgent risk areas first, and assessing the extent to which systems recover before taking further remedial steps. This approach is similar to and consistent with the remedial approach of the Great Lakes Legacy Act. We have had considerable success working with clients to apply these approaches to complex sites. Similarly, we have successfully worked with clients to use liability transfer agreements and coordinate remediation and redevelopment through contractual arrangements between PRPs and site developers. An expanded use of these tools, and the Administrator's apparent emphasis on remediation and redevelopment, suggests an increase in partnerships between developers and PRPs to expedite site remediation over the coming months and years.

Most of the Task Force recommendations lack detail at this stage, and their true impact on the remediation of specific sites will depend on how they are further developed and implemented. The next test for the new EPA leadership will be translating the Task Force recommendations into concrete actions at individual sites. Not surprisingly, in light of the many obstacles facing effective implementation of the Superfund program, this could prove to be the far greater challenge.

Footnotes

1. United States EPA, Superfund Task Force Recommendations, July 25, 2017.

2. Memorandum From E. Scott Pruitt, "Receipt of Superfund Task Force Report and Next Steps for Revitalizing the Superfund Program (Pruitt Memo), July 25, 2017 at 2-3.

3. Superfund Task Force Recommendations at iii.

4. Pruitt Memo at 2.

5. Superfund Task Force Recommendations at 1.

6. "Headquarters Takes Charge: EPA's Recent Delegations and Formation of Task Force May Signal Renewed Interest in Superfund Reform," Arnold & Porter Kaye Scholer Advisory, May 23, 2017.

7. Superfund Task Force Recommendations at 1-4.

8. Superfund Task Force Recommendations at 2; Pruitt Memo at 2.

9. Superfund Task Force Recommendations at 9.

10. Id.

11. Superfund Task Force Recommendations at 14.

12. Id.

13. Id.at 15-18.

14. Id.at 14.

15. Id.at 20-24.

16. Oversight of CERCLA Implementation: hearing Before the Subcomm. On Env't and the Econ. Of the H. Comm. On Energy and Commerce, 114^thCong, 2-4 (2016) (Statement of Steven C. Nadeau, Partner, Honigman Miller Schwartz and Cohn LLP) at page 1.

17. U.S. Gov't Accountability Office, GAO-16-777, Superfund Sediment Sites: EPA Considers Risk Management Principles But Could Clarify Certain Procedures, 29-35 (2016).

18. Superfund 2017: Cleanup Accomplishments and the Challenges Ahead, Katherine N. Probst, 2017 at x.

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