The Environmental Protection Agency published its Final National Strategy to Manage Post Construction Completion Activities at Superfund Sites on Oct. 12, 2005.[1] According to EPA, the PCC Strategy has two main purposes: (1) to assure that remedies put in place under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or superfund) continue to protect human health and the environment over the long-term; and (2) to focus EPAís efforts during the next five years on activities to ensure human health and the environment are protected at superfund sites after construction is complete.

            At first blush, these two purposes appear to be laudable and reasonable. Who would argue against assuring the long-term protectiveness of superfund remedies? Moreover, given the scope of liability associated with such sites, including liability stemming from potential toxic tort claims, the agencyís focus on long-term protectiveness would appear to coincide with the interests of superfund responsible parties.

            Unfortunately however, given the breadth of its language, implementation of the post construction completion strategy could have significant negative consequences for the regulated community, most particularly the re-opening of remedies that many have assumed were final. This could result in significant additional costs and uncertainty for responsible parties. Worse yet, renewed focus on the long-term nature of remedies could re-kindle dormant discussions regarding natural resources damages. This article will describe the key features of the PCC Strategy and analyze it from the perspective of a superfund responsible party.

 

The Superfund Cleanup Process

            Most companies are all too familiar with the process for remediating superfund sites.[2] It begins with identification and listing of a site on the National Priorities List, and continues with the study of the site, called the Remedial Investigation, and the development of cleanup alternatives, called the Feasibility Study.[3] Once the Remedial Investigation/Feasibility Study is complete, EPA selects the remedy for the site, which is documented in the Record of Decision (ROD). Underlying the decision on whether or not to require a remedy is a determination of risks to human health, during the Risk Assessment, and the environment, during the ecological risk assessment. Most Records of Decisions identify both the selected Remedial Action and the long-term remedial goals. Depending on the type of contamination associated with a site, the record may identify cleanup goals for soils, sediments, groundwater, and surface water to specified levels. The levels of cleanup are dictated by specified requirements in other laws, referred

to as ëëapplicable or relevant and appropriate requirements.íí

            Implementation of the Remedial Action typically occurs in three stages. First, the design of the remedy, the Remedial Design, is completed. Second, the physical construction of the remedy is performed. Finally, long-term care of the site remedy is accomplished during periods

EPA refers to as Long Term Response Action and Operation and Maintenance, which includes operation of groundwater pump and treat systems, maintenance of landfill caps, and long-term monitoring. CERCLA also dictates that sites be reviewed every five years after physical construction of a remedy to assure, interalia, that the remedy remains protective. This is called the Five-Year Review. Either during the Five-Year Review or otherwise, EPA will employ what it calls Remedy Optimization, a phrase coined during a recent round of superfund reforms. Remedy Optimization entails performing reviews to improve the performance and/or reduce the costs of Long Term Response Action and Operation and Maintenance. Generally speaking, those activities conducted subsequent to remedy construction are called Post Construction Completion activities.[4]

            Once EPA is satisfied that no further response action is necessary, it can choose to delete sites from the National Priorities List. Delisting sites from that list is the ultimate goal of the superfund process.

            The study and remediation of a superfund site often can be even more complex than described above. To be sure, the process is time consuming and extremely expensive. Responsible parties, having invested considerable sums in a remedy, often are loathe to consider additional remedy changes and attendant additional costs. This is particularly true in large public companies in which internal budgets and reserves may be in place based on current remedies. Many such companies are involved in numerous sites, which compounds the issue.

 

Underlying Concerns

            For a variety of reasons, many sites will contain levels of contamination above applicable or relevant and appropriate requirements for considerable periods of time. For example, achieving specified cleanup levels, most typically in groundwater, easily can take 20 to 30 years after completion of remedy construction. In some cases, pump and treat remedies for groundwater, at least in theory, can extend forever. Also, in certain situations, EPA may limit the amount of physical cleanup necessary where achieving the specified applicable or relevant and appropriate requirements is determined to be technically infeasible. Finally, and more recently, EPA has recognized that the degree of cleanup at a particular site, in both soils and groundwater, could be tailored to the physical and environmental site setting, the expected long-term use of the site, and the risks of future exposure posed by both the setting and future use. In such instances, EPA may allow contamination to remain indefinitely. This has been particularly true given EPAís recent emphasis on readying sites for reuse for brownfields projects, a factor that may not have been considered during the original remedy selection process. Regardless of the reason, many superfund sites remain with levels of contamination above applicable or relevant and appropriate requirements in both soils and groundwater after remedy construction is complete.

            Many Records of Decisions, and in particular early Records of Decisions, do not contain enforceable institutional control requirements to assure prevention of exposure to contamination left in place over the long term. For example, while EPA often times required that notices of the cleanup and the presence of the contamination be placed in property deeds, actual restrictions on the use of the property were not required. Examples of such restrictions, recorded with the deeds for properties, include prohibitions on the use of groundwater and on residential buildings.

                                    Until recently, EPAís activities under the superfund program have focused on the completion of the Remedial Investigation/Feasibility Study, Remedial Design, and physical construction of remedies. However, now that more than 60 percent of superfund sites are through remedy construction, EPAís focus has shifted to assuring long-term management of those remedies.[5] The post construction completion strategy sets out EPAís game plan to accomplish long-term management and protection.

 

 Legal Basis for the PCC Strategy

            EPA cites Section 121(b) of CERCLA as the legal basis for its PCC Strategy. This section requires ëëa remedial action that is protective of human health and the environment, that is cost effective, and that utilizes permanent solutions and alternative treatment technologies or resource recovery technologies to the maximum extent practicable.íí

             It is clear from this language that Congress intended superfund remedies to be permanently protective. During remedy selection, EPA has gone about implementing this language through application of nine criteria, set out in the National Oil and Hazardous Substances Pollution Contingency Plan.[6] These criteria include: (1) overall protection of human health and the environment, (2) compliance with applicable or relevant and appropriate requirements, (3) long-term effectiveness and permanence, (4) reduction of toxicity, mobility, or volume through treatment, (5) short-term effectiveness, (6) implementability, (7) cost, (8) state acceptance and (9) community acceptance.

            Compliance with each of the nine criteria is evaluated in different ways. For example, the first two are ëëthreshold criteriaíí that all remedies must meet.[7] The third through seventh are ëëprimary balancing criteriaíí that are weighed in various ways. The last two are ëëmodifying criteriaíí that are considered in the final analysis.

             While the initial selection of a remedy by EPA relies on all nine criteria, the PCC Strategy appears to focus on the first (overall protection) and third (long-term effectiveness) criteria, with less emphasis on the others. EPAís emphasis on these two criteria, as well as its reliance on the statutory language quoted above for its authority to implement many aspects of the PCC Strategy, may be the subject of challenges—particularly if EPA seeks to re-open remedies, require financial assurance mechanisms for operation and maintenance activities

and force implementation of institutional controls at many sites. Some may argue that none of these activities are explicitly authorized by the statute.

 

 The Post Construction Completion Strategy

            The PCC Strategy sets out five goals: (1) ensure remedies remain protective and cost effective; (2) ensure institutional controls required as part of the remedy are implemented and effective; (3) assure adequate financing and capability to conduct post construction completion

activities; (4) support appropriate reuse of sites while assuring remedy reliability; and (5) improve site records management to better ensure remedy reliability.

            EPA describes the PCC Strategy as a ëëmanagement framework of goalsíí from which ëërecommended approaches and initiativesíí will flow. The approaches and initiatives are targeted at fulfilling each of the five enumerated goals. The PCC Strategy cites to a number of pre-existing guidance documents, many of which were developed during superfund reforms in 2004. Based on the broad language of the PCC Strategy, EPA intends to evaluate all construction complete sites against these goals. To the extent that EPA deems that a remedy needs to be changed, it intends to re-open Records of Decisions.[8]

            The remainder of the PCC Strategy discusses how EPA anticipates achieving each goal. Interestingly, EPAís approach involves initiatives aimed at ëëoptimizing remedies to increase effectiveness and/or reduce cost without sacrificing long-term protection of human health and the environment.íí A close reading of this ëëoptimizationíí approach reveals a number of new requirements that EPA may impose on responsible parties at sites. In other words, in the context of ëëachieving goalsíí and ëëoptimizing remedies,íí EPA proposes to implement a variety of new initiatives that will impose new requirements on those responsible for completion and maintenance of remedies. To understand the potential for responsible party impacts, further discussion of each goal and the proposed initiatives is necessary. For a variety of reasons, it is safe to assume any additional costs associated with implementation of the PCC Strategy will be borne by the responsible parties.

            Goal 1—Ensure that remedies remain protective and cost-effective. EPA explains that there are a number of tasks involved in ensuring remedies remain protective and cost-effective. For example, O&M of engineered remedies (e.g., containment, pump and treat, and ongoing soil remedies) is necessary over the long term. This involves monitoring, repair, and replacement of existing structures as necessary to keep the remedy in place and functioning. Also, EPA notes that large volumes of data must be managed to track progress. Tracking progress could result in implementing operational changes.

             Interestingly however, EPAís discussion of this goal goes beyond merely implementing operation and maintenance and operational changes to existing remedies. For example, EPA states that initial remedies are ëëselected, designed, and constructed based on the best knowledge of site conditions and technology available at the timeíí and ëëmost remedies will have a dynamic nature over time.íí[9] This language suggests that ensuring protectiveness may likely entail wholesale reconsideration of fundamental aspects of remedies.

            EPA cites several assessment factors that could cause it to reevaluate existing remedies, including changing site characteristics and technological innovation. Presumably, therefore, EPA could determine that a remedy needs to be re-opened either because a new and better technology has been developed or because the area surrounding the site has changed. Perhaps most telling is

EPAís statement that ëë[r]emedy update types could include not only changes in the remediation technology, but also modification of the remediation objectives." [10] To accomplish this goal, the PCC Strategy recommends better tracking of remedies by EPA, development of ëëEnvironmental Management Systemsíí approaches (e.g., plan, review, and improve), and modification of enforcement documents to include provisions aimed at assuring long-term goals (e.g., financial assurance provisions).

            Goal 2—Ensure that institutional controls required as part of the remedy are implemented and effective. Institutional controls (ICs) are administrative, legal controls that minimize exposure to remaining contamination and protect the integrity of remedies. Examples include deed restrictions on land use and groundwater. EPA recognizes that its past assumptions regarding institutional controls may not be correct. For example, EPA has recognized that implementing, monitoring, and enforcing institutional controls at sites is considerably more complicated than previously understood. Therefore, the agency intends to revisit institutional controls to ensure long-term protectiveness of remedies.

             It also appears that EPAís concerns go beyond currently implemented institutional controls. Many sites at which remedy construction is complete have no deed restrictions in place. Therefore, a necessary prerequisite to achieve the second goal is to require implementation of institutional controls in the first place.

             EPA has been assessing institutional controls at sites for several years and has published several guidance documents on the subject.[11] In fact, EPA recently completed an initial round of institutional controls data entry into a database of sites at which construction is complete. Those efforts are ongoing.

             Part of EPAís assessment of institutional controls involves targeted information requests to responsible parties. Recently, EPA sent out such information requests regarding the use and enforceability of institutional controls at particular sites. Responsible parties that have not yet received such a request, are likely to in the relatively near future. These requests are very broad and require the submission of documents, including a legal opinion on the enforceability of institutional controls. A legitimate question exists as to the legal authority of EPA to request such information.

            The language of the post construction completion strategy, as well as recent experience, appears to strongly suggest EPA will require institutional controls at all sites where residual contamination remains in place after remedy completion. Unfortunately however, there are situations in which the landowner may not be readily identifiable or approachable (due to death, bankruptcy, complicated corporate restructuring, etc.). In these instances, neither the responsible party nor EPA may have the legal authority to impose deed restrictions.

             Ironically, implementation of this goal may impede EPAís ability or willingness to delete sites from the National Priorities List. At one such site, an old unlicensed landfill, EPA has decided institutional controls, which were not part of the original remedy requirement, must be in place prior to site deletion. By EPAís accounts, the remedy has been extremely successful, and the site is touted by EPA as a success story. As a result, EPA approached the responsible parties about deleting the site from the National Priorities List. However, after reviewing the case EPA determined that a deed restriction needed to be in place prior to site deletion. Because this is a site at which ownership remains unclear, it may be impossible to implement a deed restriction. EPA is therefore delaying site deletion. Clearly attaining Goal Two may involve considerable effort on the part of EPA and responsible parties. In some cases, it may be impossible

to achieve this goal.

            Goal 3—Assure adequate financing and capability to conduct post construction completion activities. The development of this goal is rooted in EPAís recognition that assuring long-term activities at superfund sites likely will cost a considerable amount of money. Unfortunately, EPA believes it has no statutory authority to fund any such work, except in certain circumstances. For example, EPA explains that it cannot utilize superfund money to fund any work beyond Long-Term Response Action (e.g., 10 years of pump and treat).[12] Whether or not the statute actually supports this conclusion, it appears EPA will require others to assume the costs of such long-term activities.

             The PCC Strategy states that superfund relies principally on state governments and responsible parties to ensure long-term operation and maintenance is performed at sites. However, EPA correctly identifies two key limitations of this approach. First, states have fewer dollars to spend on superfund sites and, therefore, have a very limited capability to oversee operations and maintenance, let alone to conduct it themselves. Second, as more sites enter the post construction completion cleanup phase, overall costs are likely to rise significantly. The PCC Strategy states that EPA and the states are in the initial stages of identifying the ëëfull complement of funding mechanisms for financing sites.íí[13]

            Short of new state or congressional funding for such work, which seems unlikely, it appears obvious that the costs for such work are likely to be borne by responsible parties. In fact, the PCC Strategy recommends that EPA and others work to ensure that responsible parties fulfill their operation and maintenance obligations. This effort will involve the implementation of financial assurance mechanisms similar to those required for RCRA Corrective Action cleanups (bonds, letters of credit, etc.). Whether EPA has the legal authority to insist on such financial assurance is an issue. Furthermore, it is unclear how EPA will seek to impose such requirements, particularly in cases in which settlements were finalized many years ago.

            The likely fact that the costs of operation and maintenance will be visited on responsible parties should not come as a surprise. Responsible parties have long recognized that superfund liability is forever. The real question is whether such costs ultimately will be more expensive because of the application of the PCC Strategy. In addition to the potential costs associated with

remedy revisions, the costs associated with purchasing and maintaining a financial instrument to assure 30-plus year operation and maintenance programs (e.g., pump & treat systems) may be significant. Also, costs to fund state oversight programs likely will be added to the responsible partyís tab.

            Goal 4—Support appropriate reuse of sites while assuring remedy reliability. This goal fits well with EPA and various state efforts to encourage the reuse of superfund sites under the rubric of both federal and state brownfields programs. Through implementation of this goal, EPA seeks to speed up the process of providing approvals for redevelopment of superfund sites. The PCC Strategy states that a site need not be deleted from the National Priorities List before being deemed ëëready for reuse.íí Rather, sites may be so designated once remedy construction is complete and necessary controls on residual contamination are in place. Under a new initiative, called ëëReturn to Use,íí EPA will review sites for ways to reduce actual or perceived barriers to

redevelopment.[14] In some cases, and as discussed previously, this may involve changes to the remedy in the form of an amendment to a Record of Decision or an Explanation of Significant Difference (used in situations where the remedy is modified but not fundamentally changed).

                                    Goal 4 is very significant for redevelopment projects. Unfortunately, the PCC Strategy contains little specific detail on how EPA will determine sites are ready for redevelopment

or on what conditions will preclude such a determination. Presumably the details are to be worked out on a site-specific basis.[15]

            Goal 4 is something to applaud in theory. However, in practice there may be some very significant issues for responsible parties that are left unaddressed, particularly in terms of residual liability after reuse is accomplished. For example, a responsible party may have no control over the property at the time reuse is contemplated. Perhaps it never owned the property or may have sold it years ago. Therefore, it may be unable to contractually assure that its future liability is covered. Moreover, the new owners/redevelopers generally negotiate some form of liability relief with EPA or the state. Regardless of their ability to deal with their liabilities contractually, some responsible parties may legitimately feel that they have nothing to gain, and everything to lose, by redeveloping former properties. This issue is left unaddressed by the PCC Strategy.

             Consider a scenario in which a developer purchases a former industrial property containing residual contamination. The developer, which acquires title to the property via a limited liability corporation, then develops the property utilizing engineered structures (caps/ barriers/etc.) to prevent ongoing exposure to contamination. As part of an agreement with EPA or the state, the developer agrees to maintain those structures.

            The development may be a great success and draw additional development, along with additional population, closer to or even onto the property. What if that developer is suddenly out of the picture? Perhaps its other projects were not as successful and it goes bankrupt? In any event, what remains is a responsible partyís worst fear—additional potentially exposed populations and engineering controls that may be very expensive to maintain. Who is left holding the bag in this scenario? Certainly not the government. The developer is gone. The only one left is the responsible party, for whom liability is forever.

            Goal 4 does little to protect even the current liability status of the responsible party. In fact, it may create a situation in which the responsible party is left in a worse position. Goal 4 does not, for example, seek to require the developer to provide financial assurance for the operation and maintenance work its development has created. Also, goal 4 does little to incentivise a responsible party that currently owns properties to release them into the brownfields marketplace. While certain mechanisms are available, such as environmental insurance products, to insure certain risks associated with redevelopment, goal 4 does not seek to impose them as a condition to redevelopment. Goal 4 should be further developed to deal with such issues and to provide meaningful protections and incentives for moving forward with brownfields projects.

            Goal 5—Improve site records management to better ensure remedy reliability. This goal is aimed principally at upgrading EPAís records management procedures. It seeks to ensure data about site conditions and cleanups, including required institutional controls, will be available when and if needed in the future.

            While responsible parties have no direct obligation for implementing goal 5, they should nevertheless consider implementing comparable records management systems to protect their long-term interests. For example, records related to historical site conditions and chemical use, present site conditions including constituents present, and cleanup activities conducted, should be maintained and be accessible. Such information may be critically important in 20 years to defend a toxic tort suit by showing the contaminants of concern were released at the site after the responsible partyís tenure at the property.

             While many large companies have sophisticated records management systems in place, most focus on ongoing operational records. Some do not encompass historical records, particularly historical records relating to formerly owned or operated facilities. Records management systems should be reviewed and revised in order to capture this type of information.

 

Summary of Responsible Party Concerns

            Clearly, the PCC Strategy raises a number of concerns for responsible parties. Much of the language of the strategy is extremely broad. The specter of wholesale remedy revisions is of great concern. However, the notion of even more modest remedy revisions raises similar concerns. Most companies, particularly large ones, have done fairly well managing superfund liability over the years. Many of them are under the impression that sites at which remedial construction is complete are under control and are accounted for from a financial perspective. Even modest changes at multiple sites may prove those assumptions wrong.

            Putting aside actual remedy changes, companies with large numbers of sites will have to review and manage the post construction completion process for their sites. Responding to EPA queries regarding institutional controls, implementing institutional controls, conducting technical reviews of existing remedies against new technology and changing patterns of population movement, and implementing requirements to comply with new financial assurance provisions will require significant efforts.

            In addition, the fact that EPA may be required to transition many of these sites to state agencies likely will raise additional concerns. States that do not have the budgets to oversee these sites will seek to impose those costs on the responsible parties. Some companies also are concerned that states may be more inclined to revisit remedies. This may simply be a function of having new sets of eyes review projects. Also, many states have implemented new cleanup policies and requirements since the original remedy was selected at a given site. Some of these may be more stringent than federal requirements and more stringent than those in place at the time EPA selected the remedy. Examples include vapor intrusion policies, more stringent cleanup levels, more stringent wetlands requirements, and more stringent air and water discharge limits, including those resulting from Total Maximum Daily Loads that could affect groundwater treatment systems. States may feel that they must impose these new requirements at sites now under their direct control.

            Perhaps the most alarming consideration is the possibility that renewed focus on the long-term nature of some cleanups (e.g., a 30-year pump and treat remedy) may create a higher likelihood that states will bring natural resources damages claims against responsible parties. Several states already have been active in bringing natural resources damages claims. Such claims have the potential to be significant.

 

Conclusion

            It is perhaps inevitable that post construction issuesare squarely on the table at this time in superfundís history. As EPA notes in the PCC Strategy, the program is maturing to the point where the majority of sites are in the post construction phase. For most of these sites, remedy selection occurred many years ago and there are a variety of new remedial technologies available. Moreover, critical thinking about how best to manage sites and to conduct cleanups has evolved significantly. In addition, EPA and state policies encouraging redevelopment, as well as developersí willingness to redevelop sites, are changing fundamental assumptions about long-term use of certain properties. In fact, the post construction completion strategy squarely raises the specter that no remedy is ever final. As discussed, EPAís approach to managing such sites may well result in re-opened remedies, requirements for financial assurance mechanisms, implementation of institutional controls, additional federal and state oversight costs, and the possibility for renewed focus on natural resources damages. Viewed in this light, EPAís PCC Strategy raises significant financial concerns for responsible parties.

            Whether or not the implementation of the PCC Strategy will result in significant new costs, responsible parties should not ignore the process. It certainly makes sense for companies to oversee, manage, and address all relevant issues at post construction complete sites. Moreover, responsible parties must become involved in the process to assure that implementation of the post construction completion strategy does not result in superfund redux.