EPA Identifies Additional Classes Of Facilities In Development Of Financial Responsibility Requirements Under CERCLA §108(b)

    Section 108(b) of the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”) requires the President to promulgate requirements that classes of facilities establish and maintain evidence of financial responsibility consistent with the degree and duration of risk associated with the production, transportation, treatment or disposal of hazardous substances. Section 108(b) requires the President to identify those classes for which requirements will be first developed and publish a notice in the Federal Register. This responsibility has been delegated to EPA for non-transportation related facilities. 

    On July 10, 2009, EPA Administrator, Lisa Jackson, signed such a notice identifying hardrock mining facilities. In its notice, EPA expressed the belief that classes of facilities outside the hardrock mining industry might also warrant financial responsibility requirements under Section 108(b). The notice identified classes of facilities which EPA intends to examine in the future including: hazardous waste generators, hazardous waste recyclers, metal finishers, wood treatment facilities and chemical manufacturers. EPA indicated that it would complete and publish in the Federal Register additional classes of facilities it plans to evaluate under Section 108(b) by December, 2009 and at that time would solicit public comment.  

    On January 6, 2010, EPA announced that it would be identifying classes of facilities within three industries – the Chemical Manufacturing industry (NAICS 325), the Petroleum and Coal Products Manufacturing industry (NAICS 324) and the Electric Power Generation, Transmission and Distribution industry (NAICS 2211) as those for which EPA plans to develop, as necessary, a proposed regulation identifying appropriate financial responsibility requirements. 

    EPA indicated that it would carefully examine specific activities, practices and processes involving hazardous substances at these facilities as well as Federal and State authorities, policies and practices to determine the risk posed by these classes of facilities and whether financial responsibility requirements would effectively reduce those risks. 

    In its July 2009 notice, EPA indicated that it would examine eight factors to determine the risk posed by particular classes of facilities. These factors are: (1) the amount of hazardous substances released into the environment; (2) toxicity of the substances; (3) existence and proximity of potential receptors; (4) contamination historically found from facilities; (5) whether the causes of this contamination still exist; (6) experiences from federal clean-up programs; (7) projected costs of federal clean-up programs; and (8) corporate structures and bankruptcy potential. In order to develop the list of facilities, EPA used information concerning sites on the National Priorities List ("NPL"), hazardous waste generation information from the Resource Conservation and Recovery Act ("RCRA") Biennial Report and data from the Toxic Release Inventory ("TRI"). 

    Examination of the NPL data revealed six industry sectors and one group of facilities on which EPA determined to focus further. These were (1) the Waste Management and Remediation Services industry; (2) the Chemical Manufacturing industry; (3) facilities engaged in recycling materials containing hazardous substances; (4) the Wood Product Manufacturing industry; (5) the Fabricated Metal Product Manufacturing industry; (6) the Electronics and Electrical Equipment Manufacturing industry; and (7) the Petroleum and Coal Products Manufacturing industry. Analysis of the RCRA Biennial Report data indicated that there are two industry sectors which generated the majority of hazardous waste -- the Chemical Manufacturing industry and the Petroleum and Coal Products Manufacturing industry which together with Hardrock Mining industry represent 80% of the RCRA hazardous waste generated by large quantity generators. 

    The TRI data was analyzed for 2007 and revealed two industry sectors identified in the NPL analysis were also among those reporting the largest quantities of on-site releases of hazardous substances – the Chemical Manufacturing industry and the Waste Management and Remediation Services industry.  

    The two industry sectors which according to EPA "emerged as clearly appropriate for consideration" were the Chemical Manufacturing industry and the Petroleum and Coal Products Manufacturing industry. In addition, EPA indicated that it was appropriate to identify classes of facilities within the Electric Power Generation, Transmission and Distribution industry for financial responsibility regulation. As to this latter sector, EPA noted that it ranked third in toxic release inventory analysis and that its low ranking in the RCRA Biennial Report analysis was the result of the "Bevill exempt" waste that the industry generated. In addition, EPA referenced the large release of coal ash from the Tennessee Valley Authority's Kingston Plant as a reason for including this sector.  

    In addition to the sectors mentioned above, EPA identified four additional sectors as requiring further study. These were Waste Management and Remediation Services industry; the Wood Products Manufacturing industry; the Fabricated Metal Product Manufacturing industry; and the Electronics and Electrical Equipment Manufacturing industry. In addition, EPA indicated that it would perform further study on an industry it identified as facilities engaged in recycling of materials containing CERCLA hazardous substances. 

This article was authored by James R. Snyder, Jackson Kelly PLLC. For more information on the author see here.