Mr. Smith Goes To Washington: 1997 Superfund Amendments⁽¹⁾

Will It Solve the Liability Problem and How Will This Affect Massachusetts?

I. Introduction

Who is responsible?

This question is an important part of legal practice. Under tort theory, once you have identified the parties and discovered the facts, the next question to answer is "who is responsible?" Where should the blame be allocated? In the realm of environmental law, specifically hazardous waste cleanup, this is not always a particularly easy question to answer.

The federal government attempted to set up a scheme to make answering this question easier with the enactment of The Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA or Superfund).⁽²⁾ Instead, it made things costlier and more difficult.⁽³⁾ In fact, the federal government increased the total cost of cleanup by adding transactional expenses, "the costs that are invariably associated with the allocation of responsibility through litigation," to the existing costs for physically cleaning up the sites.⁽⁴⁾

[T]he Superfund bill marks a major commitment--financed in a balanced way--to clean up the life-threatening residue of the now waning industrial age. It is a symbol that even in this conservative era, government and industry are prepared to meet their obligations to public health, not walk away from them.⁽⁵⁾

Congress drafted the bill, however, without taking many realities of life into account. On many important issues the statute is general, if not downright vague.⁽⁶⁾

Massachusetts enacted a similar bill in 1983: the Oil and Hazardous Material Release Prevention and Response Act (Chapter 21E).⁽⁷⁾ Chapter 21E has endured many of the same criticisms as its federal counterpart.⁽⁸⁾ Although, after a complete overhaul in 1992,⁽⁹⁾ Chapter 21E accomplishes more than CERCLA.⁽¹⁰⁾

An important issue surrounding both CERCLA and Chapter 21E is liability, specifically the method for allocating responsibility among potentially responsible parties (PRPs).⁽¹¹⁾ CERCLA attempted to make this allocation easier, but it has failed miserably.⁽¹²⁾ The current standard under both CERCLA and 21E is strict liability.⁽¹³⁾ Currently, there is a movement in Congress to alter this stringent liability standard, in hopes of increasing cleanup and decreasing litigation.⁽¹⁴⁾ The proposed amendments to CERCLA, sponsored by Senators Chafee and Smith,⁽¹⁵⁾ intend to achieve this through two parts: (1) exempting certain small contributors from liability and (2) by repealing joint and several liability and implementing a mandatory non-binding allocation process at all multi-party sites.⁽¹⁶⁾

This Note examines whether or not the proposed amendments will succeed in actually decreasing litigation costs and increasing private party responsibility in the area of hazardous waste site cleanup. Also, this Note explains the effect that this bill would have on present Massachusetts liability allocation standards. Part II provides a background history of CERCLA.⁽¹⁷⁾ The main provisions of the statute are discussed in Part II.B.⁽¹⁸⁾ Part II.C. also contains the background history for CERCLA's Massachusetts counterpart, 21E.⁽¹⁹⁾ The state's main provisions are explained as well.⁽²⁰⁾ Part II.E. considers the past amendments to both the federal and state statutes, respectively.⁽²¹⁾ Part III explains the present liability provisions for allocation of costs under CERCLA and Chapter 21E and their controversial nature.⁽²²⁾ Part IV discusses the amendment to CERCLA's scheme for liability allocation as created by the Superfund Cleanup Acceleration Act of 1997.⁽²³⁾ The effects that this amendment will have on Superfund's liability standards and on General Law 21E are then discussed in Part V.⁽²⁴⁾ Part V.D. proposes a tax credit that was not included in this year's bill, while Part VI concludes the Note, commenting on the need for superfund reform.⁽²⁵⁾

II.  Background

A. The History of CERCLA

The industrialization of American society was a major force of the Twentieth Century.⁽²⁶⁾ With this industrialization, many difficult issues previously unseen arose: regulation of securities, antitrust activities, labor issues, and transportation, just to name a few.⁽²⁷⁾ Congress attempted to remedy most of these social and public issues through various forms of legislation.⁽²⁸⁾ However, one area was left virtually untouched by the government for almost seventy years: the negative effects of the massive outgrowth of industrialization on the environment.⁽²⁹⁾ The new age of industry brought with it not only jobs and technology, but also chemical wastes and unwanted manufacturing by-products that, when not disposed of properly, caused major environmental damage.⁽³⁰⁾ The horrific reality of unregulated, unchecked, negligent disposal of hazardous waste was realized in such places as Love Canal, New York⁽³¹⁾ and the "Valley of the Drums" in Kentucky.⁽³²⁾

Congress decided it needed to do something once and for all about these hazardous waste sites and passed the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or Superfund) in the post-election session of 1980.⁽³³⁾ The bill "represent[ed] a natural adaptation of centuries of common law developments as extended by modern environmental statutes."⁽³⁴⁾ CERCLA was designed to eliminate the problems presented by abandoned hazardous waste dumps that were not sufficiently dealt with under previous law.⁽³⁵⁾ Congress wanted to rein in the potentially responsible parties (PRPs) that had been dumping hazardous waste for years and force them to stop and pay for the cleanup.⁽³⁶⁾

[Superfund] was explicitly designed to remedy the present effects of past behavior--by defining the parties responsible for cleaning preexisting (and typically inactive) toxic waste sites, by providing mechanisms by which the EPA [could] compel . . . private action, and by authorizing the government to conduct and fund the cleanups itself, should PRP intransigence, a lack of viable PRP's, or emergency conditions make such actions necessary.⁽³⁷⁾

B. Main Provisions of CERCLA: "A complex solution to a complex problem"⁽³⁸⁾

The name "Superfund" comes from section 111(a) of the Act.⁽³⁹⁾ Congress established a 1.6 billion dollar Hazardous Substance Response Trust Fund (Superfund) to be used either for cleanups or to compensate those parties who had already cleaned up the hazardous waste themselves.⁽⁴⁰⁾ The money for this Superfund was to be generated from special taxes placed on the petroleum and chemical industries.⁽⁴¹⁾

The federal government, under section 104 of CERCLA, was given proper authority to use the fund money to implement necessary cleanup activities.⁽⁴²⁾ The statute did not set up a mere trust fund for payment of cleanups; otherwise it could be seen as one of "the largest public works effort[s] in the history of the world."⁽⁴³⁾ Instead, the statute contains strict liability measures in an effort to deter illegal dumping and promote environmental responsibility.⁽⁴⁴⁾ As Phillip Cummings, Chief Counsel for the Senate Environment Committee when CERCLA was drafted, wrote: "CERCLA is not primarily an abandoned dump cleanup program although that is included in its purposes."⁽⁴⁵⁾

The drafters of the bill wanted to set up both a system for cleanup of the hazardous waste sites, and a liability system to act as a deterrent to prevent further dumping.⁽⁴⁶⁾ The idea was: you dump; you pay!⁽⁴⁷⁾

Section 107 of CERCLA imposes liability on specific PRPs for the release of hazardous waste.⁽⁴⁸⁾ The statute defines words such as "facility",⁽⁴⁹⁾ "release"⁽⁵⁰⁾ and "hazardous waste"⁽⁵¹⁾ in section 101.⁽⁵²⁾ The courts have construed section 107 to convey strict liability, although nothing in the statute specifically states this; joint and several liability apply when more than one party is involved.⁽⁵³⁾ There are a few enumerated defenses mentioned, but escaping liability, even when minimal involvement occurs is next to impossible.⁽⁵⁴⁾ The plaintiff, usually the Environmental Protection Agency (EPA), must prove the following four elements to establish a prima facie case of liability under CERCLA: (1) the site is a facility; (2) a "release" or "threatened release of a hazardous substance" occurred at the site; (3) the "release or "threatened release" has caused the United States to incur response costs; and (4) the defendant falls within at least one of the four classes of responsible persons described in section 107(a).⁽⁵⁵⁾

1.  The EPA's Role in CERCLA

The Environmental Protection Agency has the primary responsibility for administering the Superfund program.⁽⁵⁶⁾ It must establish a National Priorities List (NPL) of locations in the United States that are in need of cleanup.⁽⁵⁷⁾ Sites are judged for the NPL through a Hazard Ranking System (HRS) provided in CERCLA.⁽⁵⁸⁾ Once a site is placed on the NPL, there are three options: (1) the PRPs may undertake the cleanup work pursuant to a consent decree or other agreement (a "voluntary site cleanup");⁽⁵⁹⁾ (2) the EPA may order PRPs to do the cleanup work under section 106 of CERCLA (an "enforcement lead" site cleanup);⁽⁶⁰⁾ or (3) the EPA may clean up the site itself through an independent contractor using Superfund money and reserve the right to recover its costs from the PRPs (a "fund lead" site cleanup).⁽⁶¹⁾

Proponents of CERCLA hoped that the first option would be used the most: the PRPs would take responsibility for their own mess and cleanup.⁽⁶²⁾ But, when that is not the case, the EPA has the power under the National Contingency Plan (NCP) to "clean up first and ask questions later."⁽⁶³⁾ Importantly, the EPA, or any group cleaning up, must comply substantially with the NCP in order to recover any money from the Superfund for costs spent on cleanup.⁽⁶⁴⁾ If the proposed cleanup deviates from the limitations and guidelines provided in CERCLA and the NCP, then recovery will not be allowed.⁽⁶⁵⁾

The EPA undertakes certain steps before a cleanup is begun.⁽⁶⁶⁾ First, a PRP is immediately notified of its status.⁽⁶⁷⁾ EPA will hire an independent contractor to issue a study on what remedy will work for a particular site.⁽⁶⁸⁾ The study is called a Record of Decision (ROD).⁽⁶⁹⁾ Second, the ROD is issued to a PRP, which has 60 days to submit a good faith offer to perform the remedy.⁽⁷⁰⁾ EPA then drafts a consent decree embodying the agreement.⁽⁷¹⁾ The decree is reviewed by EPA and the United States Department of Justice.⁽⁷²⁾ And third, if the decree is deemed acceptable, then it is lodged with the proper federal district court.⁽⁷³⁾

In addition to mandating and encouraging cleanups, the EPA also has the power to require PRPs to stop the release or threat of release of hazardous substances into the environment.⁽⁷⁴⁾ This authority is important because the EPA sometimes has a difficult time forcing a cleanup, and therefore they need this measure to fall back on to mitigate the damages already incurred.⁽⁷⁵⁾

a.  Refilling the Superfund

CERCLA also allows the government to recover beyond the cost of cleanup.⁽⁷⁶⁾ EPA may request triple damages for sites where a PRP specifically avoided a mandated cleanup.⁽⁷⁷⁾ An action can also be brought for recovery of damages to the natural resources for which they are trustees.⁽⁷⁸⁾ All of the monies recovered by the government under any section go right back to the Superfund.⁽⁷⁹⁾ However, when a private party brings an action for recovery against other PRPs, CERCLA does not allow for recovery of punitive damages, or, simply, those damages beyond the cost of cleanup.⁽⁸⁰⁾

These provisions illustrate that Congress intended for the PRPs to bear the full cost of cleanup rather than innocent taxpayers or consumers.⁽⁸¹⁾ CERCLA works best when the PRPs clean up after themselves or make payments to reimburse the Superfund.⁽⁸²⁾ The Superfund can then be used to cover the costs of waste sites in which no one will take responsibility.⁽⁸³⁾ Instead, the fund is depleted from the cost of litigation to decide "who is responsible."⁽⁸⁴⁾

C.  History of Massachusetts Superfund: The Massachusetts Oil and Hazardous Material Release Prevention and Response Act-Chapter 21E

Inspired by the federal Superfund law and section 311 of the Federal Water Pollution Control Act,⁽⁸⁵⁾ the Massachusettts Department of Environmental Protection (then the DEQE, now the DEP) drafted legislation to cover illegal releases of hazardous waste.⁽⁸⁶⁾ In 1982, then Governor Edward King introduced House bill number 6367 (Massachusetts Superfund), but it was not received well and failed to pass through the Massachusetts Legislature.⁽⁸⁷⁾

Senator Carol Amick and Representative William Nagle reintroduced a modified version of the bill in 1983 as House bill number 1503.⁽⁸⁸⁾ "Representative Nagle argued that legislation was of `tantamount importance to the Commonwealth' because without such legislation Massachusetts could not participate in the Federal Superfund program which provides 90% of funding for approved cleanup projects."⁽⁸⁹⁾

On March 24, 1983, then Governor Michael Dukakis signed the Massachusetts Superfund into law.⁽⁹⁰⁾ The key features of the Act were:

(1) The appropriation of a $25 million dollar fund financed by general obligation bond borrowing for state cleanup actions (establishing a fund); and (2) an amendment to General Law chapter 21C section 7 authorizing implementation of a `fee' upon licensed transporters of hazardous waste to recover the total cost incurred by state response actions, less the amounts collected in cost recovery actions.⁽⁹¹⁾

The DEP now had concurrent jurisdiction with the EPA under this new law.⁽⁹²⁾ The bill became law, but not without controversy.⁽⁹³⁾ The Act contained a "Superlien provision," which allowed the state to recover monies from PRP releases up to three times the actual cost in order to secure payments for costs of cleanup and other (such as litigation) costs.⁽⁹⁴⁾

Real estate interest groups strongly objected to this "Superlien."⁽⁹⁵⁾ They argued that if the state could secure a lien on massive amounts of property, the title to these properties would become clouded, and therefore unmarketable.⁽⁹⁶⁾ In turn, the secondary mortgage market purchasers (such as Federal Home Loan Mortgage Association, "Fannie Mae" and Federal Home Loan Corporation, "Freddie Mac") might refuse to purchase Massachusetts mortgages, and shut down the residential mortgage market in the Commonwealth.⁽⁹⁷⁾

This opposition did not go unnoticed, and the Governor promised to review the issue immediately after enactment.⁽⁹⁸⁾ Members of the Massachusetts Legislature met with the real estate lobbyists and decided upon a compromise.⁽⁹⁹⁾ Non-owner occupied one-to-four family dwellings were removed from the reach of the Superlien.⁽¹⁰⁰⁾ However, the exemption did not extend to multifamily dwellings (apartment buildings); Senator Amick stood firm on this position.⁽¹⁰¹⁾ Thus, the Superlien remained a controversial part of the Act.⁽¹⁰²⁾

D. Main Provisions of Chapter 21E "Massachusetts Superfund"

On paper, the Massachusetts version of CERCLA looked much like its federal counterpart.⁽¹⁰³⁾ Its purpose was "'to clarify and improve the commonwealth's capability for responding to releases of oil and hazardous material and to recover response costs from persons responsible for releases for which it has incurred such costs.'"⁽¹⁰⁴⁾ A quick breakdown of the act's sections will show this similarity.

Section 2 of 21E contains the definitions for applicable terms in the statute.⁽¹⁰⁵⁾ Sections 3 and 4 set out the authorization for creating a cleanup scheme called the Massachusetts Contingency Plan (MCP).⁽¹⁰⁶⁾ This is directly on point with section 105 of CERCLA, which creates the NCP.⁽¹⁰⁷⁾ And finally, section 5 of 21E is the equivalent of section 107 in CERCLA; they both contain the layout of the liability scheme.⁽¹⁰⁸⁾ However, unlike CERCLA, 21E statutorily authorizes strict liability and in the event of multiple parties, joint and several liability.⁽¹⁰⁹⁾ Also, 21E deals with oil, while CERCLA does not.⁽¹¹⁰⁾

Section 7 of 21E calls for timely notification of a "release or a threat of a release" to the DEP.⁽¹¹¹⁾ Sections 8 and 9 give the DEP the authority to perform remedial actions and/or force PRP's to assess damages to property and cleanup the hazardous waste themselves.⁽¹¹²⁾ Sections 11 and 13 are DEP enforcement tools, including the aforementioned Superlien.⁽¹¹³⁾

The final sections of the original Massachusetts Superfund lay out the strategy for creating the "State Superfund" itself, such as where the money comes from, etc.⁽¹¹⁴⁾

Therefore, the two acts seem very much the same.⁽¹¹⁵⁾ They encouraged cleanup by imposing strict liability and created trust funds to pay for cleanups, when no one would take immediate responsibility.⁽¹¹⁶⁾ A contingency plan was established as a guideline for these cleanups.⁽¹¹⁷⁾ Liability standards were set and methods of recovery for non-compliance were created as well.⁽¹¹⁸⁾

Thus, where were the problems? In the next fifteen years both acts would undergo some major changes for better and for worse.⁽¹¹⁹⁾

E.  Past Amendments to CERCLA and 21E

"A cynic might argue that while the lawyers have been cleaning up in court, no one has been cleaning up in the dumps."⁽¹²⁰⁾

In 1985, barely five years after its creation, CERCLA was in need of major renovations.⁽¹²¹⁾ The taxation and funding authority of the original CERCLA was to expire on September 30, 1985.⁽¹²²⁾ Congress was forced to re-examine the SuperfundProgram and determine whether it was actually achieving congressional cleanup goals.⁽¹²³⁾

1.  The SARA Amendments

The EPA was placing sites on the National Priority List and finding potentially responsible parties, but in reality, nothing was being accomplished.⁽¹²⁴⁾ "In fact, while the EPA had identified over 20,000 potential hazardous waste sites (the CERCLIS inventory) and had listed 850 sites on the NPL, it claimed to have fully cleaned up only six sites."⁽¹²⁵⁾ A mass call went out for a major overhaul of the statute.⁽¹²⁶⁾ Lobbyists for PRPs argued that liability cleanup standards were too stringent.⁽¹²⁷⁾ The EPA complained that it did not have enough power under the statute to accomplish its goals.⁽¹²⁸⁾ Congress, the PRPs and the EPA all went back to the drawing board and put together their own respective plans for amending CERCLA.⁽¹²⁹⁾ In the end, Congress completely ignored both groups and instituted its own reforms.⁽¹³⁰⁾ After all the debate, President Reagan signed the Superfund Amendments and Reauthorization Act of 1986 (SARA)⁽¹³¹⁾ into law on October 17, 1986.⁽¹³²⁾ These reforms, many argued, failed as miserably as CERCLA itself.⁽¹³³⁾

SARA's main effect was felt on CERCLA's cleanup standards.⁽¹³⁴⁾ Section 121 made it clear that permanent, long-term solutions were now necessary when assessing a facility.⁽¹³⁵⁾ The EPA must now make specific factual findings before selecting a particular remedial approach.⁽¹³⁶⁾ Previously, the EPA could choose the cleanup standard necessary for a facility as it saw fit, but now it had to choose based on Congress' detailed guidelines.⁽¹³⁷⁾ Through these measures, Congress was slowly wearing away the EPA's power over CERCLA.

State involvement in the entire "cleanup process" was enlarged immensely under section 121.⁽¹³⁸⁾ States became directly involved in the decisionmaking process concerning remedies, placement of sites on the NPL, and other parts of the remedial process.⁽¹³⁹⁾ Congress also provided the EPA with a fund increase, raising the Superfund from $1.6 billion to $8.5 billion.⁽¹⁴⁰⁾ The increase was made possible by the addition of a broad-based corporate surtax on all corporations having annual taxable incomes in excess of two million dollars.⁽¹⁴¹⁾ This addition to CERCLA substantially increased the number of corporations being taxed for Superfund reimbursement.⁽¹⁴²⁾

According to section 116 of SARA, the EPA was to begin remedial action at 175 facilities during the first 36 months after SARA was enacted. This is a huge figure considering the past track record.⁽¹⁴³⁾

The most important change SARA wrought was the creation of a settlement framework for contribution actions among PRPs.⁽¹⁴⁴⁾ Now, PRPs could bring other PRPs into the picture to share liability.⁽¹⁴⁵⁾ Previously, parties would become jointly and severally liable with no recourse to recover monies spent on cleanup that was truly not their own.⁽¹⁴⁶⁾ The days of one party taking the fall for everyone were over. Section 113(f) of CERCLA prescribes an "equitable method" for allocation of response costs in contribution actions.⁽¹⁴⁷⁾

As mentioned above, state involvement was increased as well.⁽¹⁴⁸⁾ "SARA requires that, before EPA adopts a remedial plan for a site, the Agency must (1) provide public notice of its impending decision and an analysis of the plan; (2) permit public comment on the plan; (3) conduct a public hearing about the remedial plan."⁽¹⁴⁹⁾

Congress also succeeded in partially shutting the judiciary out of the cleanup process.⁽¹⁵⁰⁾ Section 113(h) limited the PRPs recourse to the courts by depriving the judiciary of jurisdiction to review Agency remedial decisions prior to the EPA's initiation of enforcement actions.⁽¹⁵¹⁾ But, with all of these changes, the basic standards for initial PRP liability remained the same; strict liability with joint and several liability in the case of multiple parties.⁽¹⁵²⁾

Overall, the SARA provisions worked to confine the EPA instead of opening up its power.⁽¹⁵³⁾ These new, rigid standards again led to more litigation, with less money spent on cleanup.⁽¹⁵⁴⁾ In short, Congress, by enacting SARA, made a bad situation even worse.⁽¹⁵⁵⁾

2.  1986 Amendments to 21E

At the same time SARA was being bandied around Congress, the Massachusetts Legislature was feeling some heat concerning the Massachusetts Superfund.⁽¹⁵⁶⁾ Critics on Beacon Hill⁽¹⁵⁷⁾ were making the same arguments that were being made on Capitol Hill.⁽¹⁵⁸⁾ MassPIRG,⁽¹⁵⁹⁾ a state environmental public-interest research group, conducted a study and estimated the following:

--work was proceeding only at a small percentage of the total number of sites of contamination;

--the sites being worked on were not necessarily the most severe threats to public health or environment;

--the sites not being worked on were getting worse as the contamination spread; and

--where cleanups were being done, the actions being taken were not really solving the problem.⁽¹⁶⁰⁾

In November 1986, the people of the commonwealth voted, by answering a referendum question, on whether to amend 21E.⁽¹⁶¹⁾ The referendum question "was supported by 74% of the voters and while the amendments did not change the basic concepts of the statute that require persons legally responsible to clean up releases, they did establish deadlines and standards for cleaning up sites."⁽¹⁶²⁾

Similar to SARA, the goals of the amendments were to meaningfully involve citizens in studies, decisionmaking and response actions and to change the provisions concerning cleanup standards.⁽¹⁶³⁾ Massachusetts employed a new two-step system:⁽¹⁶⁴⁾ "(1) interim responses using existing technologies to contain and control hazards, until (2) permanent responses using reliable methods are available to eliminate long-term measures."⁽¹⁶⁵⁾

21E was amended again in 1987 by adding sections 16, 17 and 18 to deal with issues surrounding the liability of response action contractors.⁽¹⁶⁶⁾

a.  Comprehensive Amendments to 21E in 1992

The Massachusetts Superfund was a continual work in progress.⁽¹⁶⁷⁾ In 1990, the DEP began a new study on how to further improve 21E.⁽¹⁶⁸⁾ A committee comprised of the DEP, environmental organizations, lobbyists for both large industries and small businesses, real estate lobbyists, lenders and attorneys, joined together to study the Chapter 21E site cleanup program.⁽¹⁶⁹⁾ This group, after lengthy meetings, developed a "comprehensive proposal for radical reform of the Chapter 21E program."⁽¹⁷⁰⁾ "The central thrusts of the redesigned program [for 21E] were recommendations to increase the private sector's role and to focus the DEP's resources on the most difficult sites."⁽¹⁷¹⁾ The changes would need to be made both to the MCP and 21E.⁽¹⁷²⁾

On July 20, 1992, Governor Weld signed into law comprehensive amendments based on these studies of 21E.⁽¹⁷³⁾ The largest change made was the revision of cleanup responsibilities (yet again).⁽¹⁷⁴⁾ The DEP now took a backseat and allowed the private sector to assume more responsibility.⁽¹⁷⁵⁾ This "privitization" of the cleanup process was accomplished by creating Licensed Site Professionals (LSPs).⁽¹⁷⁶⁾ The DEP now dealt mainly with site discovery, emergency response, standard setting, compliance audits, and enforcement.⁽¹⁷⁷⁾ Section 4A (added by the amendments) established a process for judicial review of DEP response actions in which multiple PRPs existed.⁽¹⁷⁸⁾ Before the 1992 amendments, 21E contained a "pro-rata" standard for contribution cases.⁽¹⁷⁹⁾ Section 4A states that [i]f two or more persons are liable pursuant to § 5 for such release or threat of release, each shall be liable to the others for their equitable share of the costs of such response action."⁽¹⁸⁰⁾ The amendment effectively replaced the "pro-rata" standard in contribution actions with an "equitable shares" standard.⁽¹⁸¹⁾

However, the initial liability standard (recovery actions brought by the government) did not change under the new amendments.⁽¹⁸²⁾ The imposition of strict liability, coupled with joint and several liability, remained--with a slight change made concerning "innocent owners."⁽¹⁸³⁾

Chapter 21E underwent one more round of changes in 1994.⁽¹⁸⁴⁾ These amendments redefined the concept of "owners" to deal with abandoned site responsibility, as well as the role of secured lenders.⁽¹⁸⁵⁾ Notice requirements were also slightly altered to make cities and towns liable for not reporting a release or threat of a release of oil materials, as soon as they had proper knowledge.⁽¹⁸⁶⁾

The DEP effectively implemented administrative reforms to privatize site and remedy evaluations.⁽¹⁸⁷⁾ Now LSPs would handle most of the assessment and recommendations for a site, although final enforcement still rested with the DEP.⁽¹⁸⁸⁾ However, the problem of liability allocation remained.⁽¹⁸⁹⁾

3.  One More Time for CERCLA

In 1990, CERCLA was amended again.⁽¹⁹⁰⁾ Simply put, the Superfund tax on oil, chemical and other companies was extended until September 30, 1994, by a provision added to the Omnibus Budget Reconciliation Act of 1990.⁽¹⁹¹⁾ Interest groups were surprised at this method of extension.⁽¹⁹²⁾ They believed that when the tax ran out, it would be an opportunity to revisit the statute and lobby for the amendments they had been seeking for so many years.⁽¹⁹³⁾ Since 1994, the Superfund taxing provisions have been extended only once.⁽¹⁹⁴⁾ As of the commencement of the 105th Congress, both the excise and corporate environmental income taxes have expired.⁽¹⁹⁵⁾ EPA claims it is losing approximately four million dollars a day without the active taxing provisions.⁽¹⁹⁶⁾ Currently, Superfund is operating on the budget money allotted by Congress and what remains in the superfund, trust fund.⁽¹⁹⁷⁾

Congressional leaders believe that the taxing provisions should not be renewed until widescale reform of Superfund is achieved.⁽¹⁹⁸⁾ Other critics argue to renew the CERCLA taxing provisions and worry about the amendments later.⁽¹⁹⁹⁾

CERCLA is presently on "the chopping block" for widescale reform.⁽²⁰⁰⁾ For the past two sessions of Congress, Republicans have sponsored bills that attempted to streamline Superfund and decrease the litigation problems inherent in the statute.⁽²⁰¹⁾ Senator Bob Smith (R-NH), the Chairman of the Subcommittee on Superfund, Waste Control, and Risk Assessment introduced Senate bill 1285 (S. 1285) in the 104th Session.⁽²⁰²⁾ The bill attempted to comprehensively amend Superfund by repealing strict liability and partially repealing retroactive liability by instituting a 50% tax credit for PRPs who "dumped" prior to CERCLA's enactment.⁽²⁰³⁾ S. 1285 died on the floor, but many of its measures have been re-written and introduced in this current Congressional Session as Senate bill 8 (S. 8): a new Superfund reauthorization bill co-sponsored by Smith and Senator John Chafee (R-RI), Chairman of the Senate Environment and Public Works Committee.⁽²⁰⁴⁾ Today, CERCLA sits upon Capitol Hill hoping for a bi-partisan effort to renew its taxing provisions and amend its many problems.⁽²⁰⁵⁾

III.  Allocation of Liability Under CERCLA and 21E Today

A.  CERCLA § 107(a) and 21E § 5: Cost Recovery Actions

CERCLA and 21E impose retroactive, strict, joint and several liability on PRPs.⁽²⁰⁶⁾ There is no express provision for this in CERCLA, but the federal courts have interpreted it to be the will of Congress.⁽²⁰⁷⁾ Chapter 21E on the other hand, expressly states the standard in section 5(a), "any specified person shall be liable without regard to fault,"⁽²⁰⁸⁾ and section 5(e): "All persons liable pursuant to this section . . . shall be liable, jointly and severally, to the commonwealth for their liability as set forth in this section."⁽²⁰⁹⁾

Therefore, when a site is chosen by the EPA or the DEP as a hazardous waste site, the first step is to find PRPs according to the NCP or MCP, respectively, to pay for the cleanup.⁽²¹⁰⁾ If one party can be found then that party will be strictly liable to the government for full payment of the cleanup.⁽²¹¹⁾ When two or more PRPs are found, then they are jointly and severally liable, and must evenly split the response costs, even if the amount of hazardous material dumped between them is not equal.⁽²¹²⁾ As the number of PRPs increases, the equal number of shares of response costs increase.⁽²¹³⁾ The government is usually the plaintiff in these situations, although it is possible for a private party to voluntarily undertake cleanup and seek out the PRPs who are actually responsible for the waste site.⁽²¹⁴⁾

B. CERCLA § 113(f) and 21E §§ 4A & 5: Contribution Actions

A PRP who believes that it is not fully responsible for a site may find a remedy by filing a contribution suit against other PRPs.⁽²¹⁵⁾ Under a contribution theory, response costs are to be "equitably allocated," liability is not joint and several.⁽²¹⁶⁾ Both CERCLA and 21E provide for this to foster a more equitable allocation of contribution shares among liable parties at a site.⁽²¹⁷⁾

Many problems arise at this stage.⁽²¹⁸⁾ Although the contribution theory is a more flexible alternative, it leads to monstrous litigation, mainly because PRPs will attempt to bring in as many other PRPs as possible to avoid liability and also because neither CERCLA nor 21E define what is meant by "equitable allocation of contribution shares."⁽²¹⁹⁾

The courts face a challenge from both statutes--a lack of a true standard for equitable allocation.⁽²²⁰⁾ A lack of incentive exists for PRPs to settle claims and assume responsibility for private party cleanups.⁽²²¹⁾ Due to the lack of legislation in this specific area of equitable allocation of response costs, Massachusetts has looked to federal court interpretations of CERCLA for guidance.⁽²²²⁾

There are three basic jurisprudences used by the federal courts to determine the allocation of liability among PRPs in a contribution action.⁽²²³⁾ The outcome of litigation in this area is inconsistent and unpredictable because the courts are unable to agree upon a standard for achieving "equitable allocation."⁽²²⁴⁾

1. The Three Jurisprudences of Liability Allocation

a. The "Chem-Dyne Approach"

The "Chem-Dyne Approach" is arguably the majority view.⁽²²⁵⁾ This court relied mainly on the Restatement (Second) of Torts for its outcome.⁽²²⁶⁾ "Under [the Chem-Dyne] approach, a defendant who seeks to avoid imposition of joint and several liability is required to prove the amount of harm it caused."⁽²²⁷⁾ The court reasoned that in multiple party situations that normally occur in these instances, it is generally impossible to prove exact amounts.⁽²²⁸⁾ Therefore, the court enforces traditional joint and several liability by ordering the parties to split the costs evenly, regardless of involvement.⁽²²⁹⁾ The courts who follow this approach believe it is the only fair method for allocation.⁽²³⁰⁾

b. The "Alcan Approach"

The Alcan approach has been adopted by the federal courts in the Second and Third Circuits.⁽²³¹⁾ The Second and Third Circuits also rely on the Restatement, but not in the formalistic manner of Chem-Dyne.⁽²³²⁾ These courts hold that CERCLA basically eliminates the need for proving causation in a case of liability.⁽²³³⁾ If a company has waste involved in the release, it does not matter how it arrived there, because its presence is enough to incur liability.⁽²³⁴⁾ But, the Alcan Approach "suggests that a defendant may escape liability altogether if it can prove that its waste, even when mixed with other wastes at the site, did not cause the incurrence of response costs."⁽²³⁵⁾ The court has allowed relevant evidence of "relative toxicity, migratory potential, degree of migration and synergistic capacities of the hazardous substances at the site to prove divisibility of harm."⁽²³⁶⁾

c. The "A & F" or "Moderate Approach"

The court in United States v. A & F Materials Co. reasoned that a "rigid application of the Restatement approach to joint and several liability was inappropriate."⁽²³⁷⁾ Congress intended for allocation of liability to be fair.⁽²³⁸⁾ Imposition of joint and several liability when a defendant added only a small amount of waste to a site would be harsh and unfair.⁽²³⁹⁾ The A & F court took Alcan a step further and held that an approach was necessary that would ease the modern common-law view of joint and several liability in specific circumstances.⁽²⁴⁰⁾ The court concluded that six factors delineated in an unsuccessful amendment to CERCLA proposed by then Representative (now vice-president) Gore could be used to achieve this end.⁽²⁴¹⁾ Thus, under the "Moderate approach" a court may impose joint and several liability upon a defendant but, it may take the Gore Factors into account to effectuate an equitable allocation of damages.⁽²⁴²⁾ The Gore Factors are as follows:

(i) the ability of the parties to demonstrate that their contribution to a discharge[,] release or disposal of a hazardous waste can be distinguished; (ii) the amount of the hazardous waste involved; (iii) the degree of toxicity of the hazardous waste involved; (iv) the degree of involvement by the parties in the generation, transportation, treatment, storage, or disposal of the hazardous waste; (v) the degree of care exercised by the parties with respect to the hazardous waste concerned, taking into account the characteristics of such hazardous waste; and (vi) the degree of cooperation by the parties with Federal, State, or local officials to prevent any harm to the public health or environment.⁽²⁴³⁾

Although Chem-Dyne is the majority approach, many jurisdictions are moving toward use of the "Gore Factors" in determining cost allocation.⁽²⁴⁴⁾ The courts in Massachusetts have begun to move away from the majority Chem-Dyne approach and are leaning toward the "Moderate Approach" or the "Gore Factors."⁽²⁴⁵⁾ "[V]arious Superior Court cases applying [section 4 of 21E] have allowed juries to allocate responsibility among liable parties in contribution actions using equitablefactors."⁽²⁴⁶⁾

C. CERCLA § 122 & 21E § 4A: The Pre-litigation Settlement Process

Superfund contains a provision for allocating responsibility prior to going to court for judicial review.⁽²⁴⁷⁾ CERCLA provides that a PRP may choose to settle with the EPA or another PRP through a preliminary allocation of responsibility.⁽²⁴⁸⁾ A PRP may also choose to settle with the EPA over a claim and avoid incurring any further response/recovery costs after that date.⁽²⁴⁹⁾ A settling party is shielded from any later contribution actions.⁽²⁵⁰⁾

Presently, the EPA has a pilot program for allocation of response costs through a non-binding process for non-contribution actions.⁽²⁵¹⁾ "Allocation is the use of third party neutrals to assist the parties in determining their relative responsibilities for Superfund site costs."⁽²⁵²⁾ A third party allocator is chosen by the parties involved and approved by the EPA.⁽²⁵³⁾ The allocator then conducts an investigation and "assign[s] shares of responsibility for cleanup costs among all parties at a site."⁽²⁵⁴⁾

Previously, when the EPA chose to undertake an allocation procedure the burden of data collection and analysis rested wholly on them.⁽²⁵⁵⁾ Under this plan, EPA and PRPs share the costs by paying for the third-party allocator to conduct the investigation and assign the shares.⁽²⁵⁶⁾

The EPA has used ADR in different situations since 1987.⁽²⁵⁷⁾ The EPA concluded that ADR worked, but Congress has failed to pass any legislation instituting a statutorily mandated allocation process.⁽²⁵⁸⁾

Massachusetts has a similar process in 21E.⁽²⁵⁹⁾ In 1992, the Massachusetts Legislature amended Chapter 21E and created a mandatory, non-binding negotiation process that any PRP must enter into prior to bringing a private action for cost recovery.⁽²⁶⁰⁾ This negotiation stage has kept many 21E cases out of court.⁽²⁶¹⁾ Prior to the addition of section 4A, "Chapter 21E suits [were] filed before plaintiffs or defendants [knew] enough about the claims at issue to proceed to trial."⁽²⁶²⁾ Even when unsuccessful, the pre-litigation process forces the parties to narrow their dispute.⁽²⁶³⁾ The result is more efficient trials.⁽²⁶⁴⁾

However, this pre-litigation procedure only applies in private party actions.⁽²⁶⁵⁾ There are also no real guidelines for this pre-litigation settlement process.⁽²⁶⁶⁾ The parties involved are merely required to contact one another and make "good faith efforts" to settle.⁽²⁶⁷⁾ Third-party allocators are not required, nor is any other particular form of alternative dispute resolution mandatory.⁽²⁶⁸⁾ Therefore, it is questionable whether these settlements are truly efficient or mere preliminaries to litigation.

The EPA has also begun to implement an administrative reform in which the fund would pick up any shares belonging to unknown or insolvent parties.⁽²⁶⁹⁾ It is called an "orphan shares" program.⁽²⁷⁰⁾ The EPA only offers "orphan shares" when a PRP agrees to settle and voluntarily cleanup, otherwise joint and several liability applies.⁽²⁷¹⁾ Currently, Massachusetts does not have a similar program.⁽²⁷²⁾

The statutes need a definitive model for equitable allocation in both government and private-cost recovery and contribution actions in order to truly create incentives for private party cleanups and to eliminate skyrocketing litigation costs.⁽²⁷³⁾ Superfund lacks a viable liability system to encourage PRPs to take responsibility for their actions, while treating PRPs fairly concerning allocation of responsibility. Too much is being spent on who should pay rather than cleaning up sites. Legislative reform is necessary to take Superfund into the Twenty-first Century.

IV.  The Superfund Cleanup Acceleration Act of 1997: Title V Liability Allocations⁽²⁷⁴⁾

On January 21, 1997, Senate Majority Leader Trent Lott (R-Miss) introduced the first ten bills of the 105th Congress.⁽²⁷⁵⁾ Included among these important pieces of legislation was Senate bill eight, the Superfund Cleanup Acceleration Act of 1997 (the 1997 Superfund Act or S. 8).⁽²⁷⁶⁾ By placing S. 8 among the first ten bills of the new Congress, "Senate republicans cited CERCLA as one of their top ten legislative priorities for the 105th Congress."⁽²⁷⁷⁾

S. 8 is co-sponsored by Environment and Public Works Committee Chairman, Sen. John Chafee (R-RI) and Senate Superfund Subcommittee Chairman, Senator Bob Smith (R-NH).⁽²⁷⁸⁾ S. 8 is similar to the bill introduced by Sen. Smith in the previous Congress.⁽²⁷⁹⁾ One of the main goals of that bill, which remains with this present bill, is the creation of a "fair share allocation system" to help reduce the costs of litigation and transactional expenses that usually accompany the cleanup of a Superfund site.⁽²⁸⁰⁾ The 1997 Superfund Act attempts to achieve this goal by: (1) exempting certain small contributors from liability and (2) by eliminating joint and several liability from multi-party sites and implementing a mandatory non-binding allocation system with orphan shares picking up costs attributable to defunct or insolvent parties.⁽²⁸¹⁾ S. 8 would also renew the taxing provisions on chemical and petroleum industries for five years and reauthorize the Superfund program at a total of 8.5 billion dollars for fiscal years 1998-2002.⁽²⁸²⁾

A. "Carve-Outs"

Avoiding unnecessary litigation and transactional costs is the main goal of S. 8.⁽²⁸³⁾ The bill attempts to do this by exempting small contributors of hazardous waste from any liability.⁽²⁸⁴⁾ In this category are "small businesses, individuals that only disposed of household wastes, entities that conducted legitimate recycling activities, and parties that contributed extremely small amounts of hazardous waste."⁽²⁸⁵⁾ The exemption includes co-disposal landfills.⁽²⁸⁶⁾ A co-disposal landfill is basically where the members of a municipality send their "waste."⁽²⁸⁷⁾ The bill attempts to exempt the average citizen, and in turn a municipality, from liability for sending to the dump such items as disposable diapers, cosmetics, and other household wastes that may be hazardous.⁽²⁸⁸⁾ The statute would also exempt the dump or landfill that accepts these materials.⁽²⁸⁹⁾

The small business exemption applies to businesses that "average fewer than 30 employees or for that taxable year reported $3,000,000 or less in annual gross revenues."⁽²⁹⁰⁾ Previously, these types of parties may have found exemptions from liability under certain "de minimis" settlement provisions of CERCLA.⁽²⁹¹⁾ Unfortunately, they still had to go through the entire process of allocation or even worse, litigation.⁽²⁹²⁾ Therefore, parties who were barely involved with a hazardous waste site still accumulated huge transactional costs and litigation expenses.⁽²⁹³⁾ This bill would exempt these parties from the start and spare them and the EPA from undergoing costly, unnecessary processes.⁽²⁹⁴⁾

B.  The Allocation Method

The second part of S. 8 aimed at reducing litigation is the implementation of a mandatory, non-binding allocation process for all PRPs and the EPA.⁽²⁹⁵⁾ This process is similar to the one already in section 122 of Superfund, and recommended by the EPA in its administrative reforms.⁽²⁹⁶⁾

1.  Explanation of the Allocation Process

The first step in initiating the allocation process is to identify all potentially responsible parties (PRPs).⁽²⁹⁷⁾ This search begins either when evaluation of the facility by the EPA is complete or 60 days after the date of selection of a removal action; whichever date is earlier.⁽²⁹⁸⁾ Once all PRPs are identified and notified, the process may begin for choosing an allocator.⁽²⁹⁹⁾

All parties involved must agree on the selection of the third party allocator.⁽³⁰⁰⁾ The allocator is given broad authority to conduct the investigation for achieving equitable allocation.⁽³⁰¹⁾ The allocator "may exercise the information-gathering authority of the [EPA] under section 104(e), including issuing an administrative subpoena to compel the production of a document or the appearance of a witness."⁽³⁰²⁾

The allocation system is completed by statutorily defining the equitable factors necessary for consistent allocation.⁽³⁰³⁾ This is where a major change exists. The amendment specifically states that an allocator should prepare a nonbinding allocation report without regard to any theory of joint and several liability.⁽³⁰⁴⁾ Instead, the amendment sets out seven factors for the allocator to use to come to his or her decision.⁽³⁰⁵⁾ The factors are strikingly similar to those espoused by then Representative Albert Gore in 1980 and embodied in the "Moderate approach."⁽³⁰⁶⁾ The factors are:

(1) the amount of hazardous substances contributed by each allocation party;

(2) the degree of toxicity of hazardous substances contributed by each allocation party;

(3) the mobility of hazardous substances contributed by each allocation party;

(4) the degree of involvement of each allocation party in the generation, transportation, treatment, storage, or disposal of hazardous substances;

(5) the degree of care exercised by each allocation party with respect to hazardous substances, taking into account the characteristics of the hazardous substances;

(6) the cooperation of each allocation party in contributing to any response action and in providing complete and timely information to the allocator; and

(7) such other equitable factors as the allocator determines are appropriate.⁽³⁰⁷⁾

If passed, this bill will establish a statutorily defined approach to equitable allocation.

2.  The Orphan Shares Program

The bill also proposes creation of a method to pick up the "orphan shares" at a hazardous waste site.⁽³⁰⁸⁾ This program is similar to the one begun by the EPA through administrative reforms.⁽³⁰⁹⁾ Today, (except for the few sites where the EPA has already implemented the program) when costs are allocated, the known PRPs pick up all costs.⁽³¹⁰⁾ Problems arise when certain costs are unattributable and the present PRPs are forced to "pick up the tab."⁽³¹¹⁾ Under the amended proposal, any share that "cannot find a home" will be paid for by the trust or Superfund.⁽³¹²⁾ This addition to CERCLA will help eliminate the "specter of Joint and several liability."⁽³¹³⁾ "By adopting a flexible, fact-orientated approach to liability apportionment, courts can increase the effectiveness of the CERCLA liability scheme."⁽³¹⁴⁾

a.  Rejection of the Allocation Agreement

According to the amendments, an allocation is binding on the PRPs and may only be appealed to the EPA.⁽³¹⁵⁾ Any party involved with the allocation process (PRPs or the United States) may appeal, but the moving party must show by clear and convincing evidence that:

(A) the allocator did not have information concerning--

(i) 35 percent or more of the materials containing hazardous substances at the facility; or

(ii) 1 or more persons not previously named as an allocation party that contributed 15 percent or more of materials containing hazardous substances at the facility; and

(B) the information was discovered subsequent to the issuance of the report by the allocator.⁽³¹⁶⁾

If an allocation is found to be invalid, then a new allocation process shall proceed under 1997 Superfund Act guidelines.⁽³¹⁷⁾ If a PRP enters into this allocation process and then, without grounds for appeal, refuses to comply with the order issued by the allocator, that PRP will be subject to joint and several liability.⁽³¹⁸⁾

Overall, this allocation plan seems to be a fair alternative for PRPs to embrace. The system views litigation as only a "last-ditch effort." A guideline is set out for allocating costs of cleanup.⁽³¹⁹⁾ Also, any shares that cannot be attributed to a party (or can be attributed, but the party is bankrupt or insolvent) are picked up as an "orphan share" by the government through the trust fund.⁽³²⁰⁾

V.  Analysis

A.  The Exemption of Small Contributors From Liability Will Aid in Decreasing Litigation and Transactional Costs Inherent in Superfund Cleanups, But Will Ultimately Exempt Parties That Were Not Meant to Benefit

The "carve-out" exemptions at co-disposal landfills proposed by S. 8 is a much needed amendment to CERCLA.⁽³²¹⁾ Far too many parties are drawn into the Superfund process, which creates added costs and confusion.⁽³²²⁾ By exempting specific small contributors from liability the EPA can move directly to the major contributors of a site and work on allocating responsibility.⁽³²³⁾ Under present guidelines, these "small contributors" may still escape liability through other exceptions, but not without going through an allocation process, or worse, litigation.⁽³²⁴⁾ This new exemption would eliminate these parties completely.⁽³²⁵⁾ They would not have to go through a time consuming and costly process to avoid responsibility.

"It is estimated that two-thirds to three-fourths of all parties at superfund sites would be eliminated from the superfund liability web if S. 8 were implemented . . . ."⁽³²⁶⁾ Up to eighty percent of the parties at a site could be exempted out under this small party exemption.⁽³²⁷⁾

The thought process behind exempting these parties is one of a cost-benefit analysis. The cost of bringing in thousands of PRPs for one site and attempting to allocate responsibility would lead to astronomical figures.⁽³²⁸⁾ Instead, the EPA would save time and money by simply using the Superfund money to pay for their share of the cleanup.⁽³²⁹⁾ The money would come from the taxing provisions on chemical, petroleum, and other major corporations so, in reality, the responsible parties would be paying.⁽³³⁰⁾ The tax is a method of spreading the costs out among the affected parties.

Opponents of this exemption argue that polluters are being "let off the hook" for their pollution.⁽³³¹⁾ In fact, the EPA stated that it "has never supported and never will support exempting co-disposal landfill sites from superfund liability."⁽³³²⁾ One EPA official, however, explained to Congressional proponents that the exemption was actually a good idea.⁽³³³⁾ Elliott Laws, Assistant Administrator of the EPA, wrote that the EPA agreed with this type of proposal.⁽³³⁴⁾ Laws seems to agree that certain parties should be exempted because the transactional costs to bring the small parties in far outweighs the actual costs of cleaning up the site.⁽³³⁵⁾

On paper, this seems to be a good start toward avoiding unnecessary costs and litigation inherent in cleaning up a Superfund site. The exemption as written in S. 8, however, would lead to exemption of certain PRPs who are not necessarily worthy. The co-disposal landfill exemption, while working to exempt municipalities, will at the same time exempt major corporations.⁽³³⁶⁾ In some parts of the country, industrial generators of waste choose to send their pollutants to co-disposal sites.⁽³³⁷⁾ With S. 8's blanket exemption, those PRPs who do this could hide under the bill's limit on liability.⁽³³⁸⁾ The figures exempting small businesses from liability could be perceived as arbitrary, at best.⁽³³⁹⁾ S. 8 exempts businesses with thirty or fewer employees and/or that declare $3,000,000 or less in annual gross revenues.⁽³⁴⁰⁾ Small businesses may avoid liability, but this may force middle-sized businesses, who fall just outside the parameters of the exemption to bear the brunt of the costs.⁽³⁴¹⁾ Furthermore, $3,000,000 seems like a large figure for defining a "small business." The gross revenue necessary should be lowered to more realistic proportions.

And last, there is the problem of "sham exemptions." If this bill is passed, large-scale corporations may break up into many small corporations or subsidiaries to avoid liability.⁽³⁴²⁾ Would the EPA look to the parent corporation in that instance or merely at the subsidiary?⁽³⁴³⁾ S. 8. fails to address that issue.

Overall, the "carve-outs" work to save small contributors from the red tape of superfund and decrease the costs of allocation and the possibility of litigation for both them and the EPA. However, the bill must be more specifically written to address the problems which may arise when corporations attempt to hide under the small contribution exemptions.

B.  The Mandatory, Non-Binding Allocation Process Is a Step Forward for Superfund Reform

Historically, the greatest problem concerning the superfund liability scheme has been the imposition of strict liability with joint and several liability at multi-party sites.⁽³⁴⁴⁾ In a summary of S. 8 released by Senate Majority Leader Trent Lott, he stated that: "Superfund allows the [EPA] to hold any potentially responsible party liable for the entire cleanup cost at a site. This is patently unfair and, not surprisingly, has resulted in litigation where 30-70 percent of every dollar spent in the program goes to lawyers."⁽³⁴⁵⁾

Proponents of S. 8's mandatory non-binding allocation process believe that a tool to fairly allocate cleanup costs will work to decrease litigation.⁽³⁴⁶⁾ PRPs will no longer need to bring mountains of litigation in order to avoid paying costs for which they are not responsible.⁽³⁴⁷⁾ Repealing joint and several liability is an integral part of amending superfund. By looking to the "Moderate Approach" for equitable allocation of response costs in contribution actions, and applying this to all cost recovery actions, the EPA and PRPs will save time and money.⁽³⁴⁸⁾

The EPA pilot allocation program is similar to the one included in S. 8, but it is not mandatory and more importantly, it is not codified within the statute.⁽³⁴⁹⁾ S. 8 would make the allocation process mandatory for all parties at all multi-party sites targeted for the NPL.⁽³⁵⁰⁾

This allocation process has several benefits which are not found with litigation.⁽³⁵¹⁾ The EPA, in a recent study, listed the following benefits: (1) it lowers the transaction costs for resolving the dispute;

(2) mediated negotiations tend to focus more on resolving real issues, rather than posturing, and are less likely to get derailed by personality conflicts;

(3) in mediation, the parties are more likely to identify settlement options that are tailored to their particular needs; and

(4) it alleviates the time-consuming burdens on EPA of organizing negotiations because a third party neutral is available to handle these tasks.⁽³⁵²⁾

In fact, at an American Bar Association Forum on Superfund revision, John C. Cruden, a deputy assistant attorney general with the Justice Department, expressed his support for the non-binding allocation model similar to that recommended in Smith and Chafee's bill.⁽³⁵³⁾

The orphan shares program is an important aspect of the repeal of joint and several liability.⁽³⁵⁴⁾ Under CERCLA now, any shares that could not be attributed to a party are automatically paid for by the known parties.⁽³⁵⁵⁾ This leads to increased litigation.⁽³⁵⁶⁾ Under the proposed orphan shares program, PRPs will only pay for their responsible share and the unknown or insolvent party shares will be paid for by the fund.⁽³⁵⁷⁾ The proposal for orphan shares has long been an issue raised by Republicans and Democrats alike and the EPA has already begun implementation of the program therefore, it should be included in any Superfund reform.⁽³⁵⁸⁾

The codification of "equitable factors" will also assist in the private party contribution cases.⁽³⁵⁹⁾ Now, the courts will have statutory guidelines for allocating response costs when a section 113 contribution claim is brought.⁽³⁶⁰⁾ But more importantly, the number of contribution suits filed will decrease if this initial allocation process is successful.

Despite its seeming resolution to this liability problem, the creation of a mandatory, non-binding allocation process is not necessarily the savior of Superfund it seems to be. While S. 8 does create statutory guidelines for allocators to follow when assessing responsibility at a site, it does not state how the factors should be weighed.⁽³⁶¹⁾ The factors include weight, volume, and toxicity of the hazardous waste at a site.⁽³⁶²⁾ Therefore, each allocator could take one factor more into consideration than another factor and perpetuate this unfair, unreliable allocation of responsibility.⁽³⁶³⁾ In reality, assessment will most likely be arbitrary and certain PRPs could still avoid paying their equitable share by finding a sympathetic allocator.⁽³⁶⁴⁾ The EPA will not care how the shares are divided, so long as the site is paid for and cleaned. In addition, large companies may still use their influence to avoid paying their equitable share, leaving the middle-size companies to cover the entire costs.⁽³⁶⁵⁾

The EPA argues that there is no problem with the existing liability scheme and is against repealing joint and several liability.⁽³⁶⁶⁾ The EPA believes that the current system works: the EPA "orders a few `deep pockets' . . . to perform a cleanup; these parties perform the cleanup and are able to spread their costs by suing all of the other PRPs in third party lawsuits."⁽³⁶⁷⁾

This, however, is not entirely true. Many times PRPs will refuse altogether to cooperate with the EPA forcing the EPA to bring suit against the party.⁽³⁶⁸⁾ As the cost of this litigation balloons more of the superfund money is spent on enforcement, rather than cleanup.⁽³⁶⁹⁾ The Clinton Administration, specifically the Department of Justice (DOJ), the arm which carries out the enforcement actions is also against joint and several liability reform. Instead they prefer to reauthorize the taxing and funding provisions of the Act.⁽³⁷⁰⁾ If Congress streamlines the statute, litigation could decrease, resulting in less funding for the DOJ.⁽³⁷¹⁾

Lobbyists for insurance companies believe that the entire liability scheme should be repealed and a public works type of program put in its place.⁽³⁷²⁾ The insurance companies contend that it would be faster and more efficient to raise Superfund taxes and add a surcharge to all property/casualty insurance premiums, diverting the additional revenue to the fund.⁽³⁷³⁾ This money, then, would be used to pay for cleanups.⁽³⁷⁴⁾ The insurance companies' proposal would simply be "spreading the costs" to all purchasers of such insurance and to all affected parties.⁽³⁷⁵⁾

Overall, the initiation of an allocation process is an excellent start toward getting the money out of the courts and into the cleanups. The bill, however, must be more specific about how the factors should be weighed. Otherwise, the same problems that exist now with the contribution cases will carry over into the government cost-recovery cases.⁽³⁷⁶⁾ In addition, the allocation process should be more strictly proscribed. S. 8 would make allocation mandatory at all multi-party sites. There may be situations in which PRPs at a site are willing to settle with each other and the EPA, yet they still have to go through this allocation process. This would only perpetuate the present financial problems. PRPs would continue to suffer through outrageous transactional costs, merely to settle their situation.

C.  The Effects of Passage of S. 8 on Chapter 21E

The 1997 Superfund reforms have three basic goals concerning liability and allocation of liability: (1) to take specific small contributors, via "carve outs," directly out of the Superfund scheme;⁽³⁷⁷⁾ (2) to repeal strict, joint, and several liability and replace it with a mandatory, non-binding allocation process;⁽³⁷⁸⁾ and (3) to create an orphan shares program and allow the trust fund to pay for those shares that belong to insolvent or unknown parties.⁽³⁷⁹⁾

Chapter 21E contains none of the above provisions. The issue, therefore, is how they will affect the current state of the law.⁽³⁸⁰⁾ First, the "carve-outs" exemption created by S. 8 will take many municipalities in Massachusetts out of the Superfund liability web.⁽³⁸¹⁾ If a site conforms to the co-disposal landfill defined within the bill, many cities and towns will avoid liability.⁽³⁸²⁾

Chapter 21E, § 5 contains a similar provision: the "no harm, no foul" defense.⁽³⁸³⁾ In that situation, a party will not be held liable for costs when, "the substance or amount thereof released or threatened to be released does not represent a long or short term danger to the public, health, safety, welfare of the environment."⁽³⁸⁴⁾ This defense only applies in private party actions.⁽³⁸⁵⁾

Therefore, it is possible that the Massachusetts Legislature will look to the federal Superfund exemptions and expand its own small window of exemption. A movement could occur to enlarge this 21E private action defense to cover DEP, government actions, as well.

The DEP, like the EPA, could get these small contributors out ab initio and focus on the major contributors at a site, saving millions of dollars in the process. Second, S. 8 will have its strongest effect on 21E with the repeal of strict, joint, and several liability and implementation of an allocation process.⁽³⁸⁶⁾ In government actions, 21E does not have a mandatory pre-litigation procedure.⁽³⁸⁷⁾ In fact, 21E's mandatory pre-litigation procedure for private actions is vague at best, and in dire need of clarification.⁽³⁸⁸⁾ With strict liability eliminated from Superfund, 21E could easily follow suit and institute a mandatory pre-litigation procedure.⁽³⁸⁹⁾ Realistically, this probably will not happen. However, the allocation procedure provided in S. 8 will make an ideal model for § 4A mandatory pre-litigation settlements.⁽³⁹⁰⁾ Chapter 21E, § 4A only requires that parties in a private action make "good faith efforts" to settle their cases prior to going to court.⁽³⁹¹⁾ There are no statutory guidelines on how best to achieve this end.

Chapter 21E could look to the mandatory, non-binding allocation process, with listed equitable factors, and implement it as its own mandatory pre-litigation procedure. It is highly possible that parties would prefer sitting down with an allocator rather than going to court. With a list of factors to consider, there would be the same amount of certainty to the outcome.⁽³⁹²⁾ On the other hand, parties may incur substantial costs by going through this pre-litigation process and then going through actual litigation.⁽³⁹³⁾ If the Massachusetts Legislature were to adopt an allocation program, they would need to write the amendment specifically, to avoid future problems.

One area of Massachusetts law that should be resolved by the passage of S. 8 involves private party contribution suits.⁽³⁹⁴⁾ There is no statutorily defined standard for making equitable allocation of response costs.⁽³⁹⁵⁾ The courts in Massachusetts have currently been leaning away from the "Chem-Dyne approach" and toward the "Moderate approach" when assessing equitable shares of responsibility.⁽³⁹⁶⁾ Passage of S.8 would speed this movement toward the "Gore factors" and away from joint and several liability.⁽³⁹⁷⁾

Third, there is the issue of who should cover the costs of PRPs who are insolvent, unattainable, or no longer exist. The bill creates a program in which any shares that are equitably allocated to an unknown or insolvent party are paid by the Superfund.⁽³⁹⁸⁾ Massachusetts does not have a similar provision in Chapter 21E.⁽³⁹⁹⁾ The lack of a similar provision would not stop the program from affecting Chapter 21E. PRPs in Massachusetts would now have a remedy for situations in which sites involve insolvent or unknown PRPs: a PRP could bring a federal claim under CERCLA and have the federal Superfund control the cleanup and pick up the orphan shares.⁽⁴⁰⁰⁾ This may be a burden on the federal Superfund because every state that lacks this provision would then bring claims in this fashion. The opposite would probably happen. PRPs would have an outlet for bringing these types of claims but, if the state courts adopt the federal equitable allocation standards, then a PRP would pay no more than it would under the federal statute. Therefore, the common law could force the creation of an orphan shares program within 21E.⁽⁴⁰¹⁾

D.  A Fifty Percent Tax Credit on Cleanups for Retroactively Liable PRPs Would Aid in PRPs Taking Responsibility for Superfund Sites

There is one amendment which was left out of S. 8 that was a part of earlier bills brought before Congress: a fifty percent retroactive tax credit.⁽⁴⁰²⁾ CERCLA and Chapter 21E are statutes that impose retroactive liability.⁽⁴⁰³⁾ The prior dumping may have been legal forty years ago, but today the PRP would be liable under CERCLA and Chapter 21E.⁽⁴⁰⁴⁾ Currently, a lack of incentive exists for a PRP to come forward and take responsibility for a pre-1980 site. Senator Smith agreed with this and drafted the tax incentive amendment.⁽⁴⁰⁵⁾ The tax incentive consisted of a fifty-percent tax credit on response costs for those PRPs who would accept an allocator's decision and stay on site to conduct the cleanup.⁽⁴⁰⁶⁾ The credit, however, would only be available in situations that arose prior to the enactment of CERCLA.⁽⁴⁰⁷⁾ PRPs would be assessed for the costs of the cleanup associated with their actions, but allowed a tax break due to the harsh retroactive nature of the statute.⁽⁴⁰⁸⁾

Critics argue that allowing a tax credit would relax polluters' responsibilities.⁽⁴⁰⁹⁾ The EPA believes this tax credit would, in essence, "let big polluters off the hook."⁽⁴¹⁰⁾ The proponents of the tax credit argue that it is a fair trade off.⁽⁴¹¹⁾ CERCLA holds polluters financially liable for actions undertaken prior to its enactment.⁽⁴¹²⁾ Businesses who dumped prior to 1980 broke no environmental laws at that time, but are held liable under present CERCLA standards.⁽⁴¹³⁾ The government must create some incentive for these companies to settle with the government and undertake cleanup themselves. The alternative to a fifty-percent tax credit is having the government pay for the entire cleanup, and lose essential monies for the superfund.⁽⁴¹⁴⁾

Chapter 21E does not have a tax credit for these types of actions.⁽⁴¹⁵⁾ Like most states, Massachusetts has a problem with PRPs coming forward and taking responsibility for pre-1980 sites.⁽⁴¹⁶⁾ If this tax incentive were included, Chapter 21E could step aside and allow the federal Superfund to basically "pre-empt." A fifty-percent tax credit on all cleanup costs, along with equitable allocation (knowing, as a PRP, you only pay for the amount you released) is great incentive for PRPs to take the responsibility of cleanup.⁽⁴¹⁷⁾ The state superfund would not have to adopt a similar provision. When a federal CERCLA claim is brought, the state is usually left with the main responsibilities of the cleanup.⁽⁴¹⁸⁾ Therefore, the PRPs would still be under the watchful eyes of the Massachusetts DEP, yet the federal superfund would "pick up the tab."⁽⁴¹⁹⁾ There seems to be no reason why a proponent of 21E would not welcome this tax credit, in order to give incentives for difficult cleanups and ease the burden on the states to come up with a similar plan.

VI.  Conclusion

There is no question that Superfund is a statute in need of reform. Since its inception, it has been ridiculed as an example of all that is wrong with hazardous waste cleanup: excessive litigation and soaring transactional costs. For the past two sessions, Congress has made concerted efforts to achieve some measure of reform. At the heart of the debate is CERCLA's liability scheme. The Democrats argue that strict liability is a faithful deterrent for encouraging cleanup. The Republicans counter that the liability scheme is too harsh and brings in far too many parties.

The EPA has already begun to fix Superfund via administrative reforms. However, legislative amendment of the failing statute is necessary. Representative Sherwood Boehlert, a top Republican and environmentalist, most precisely outlined the problem when he addressed a Committee on Superfund reform: "If Superfund could be fixed administratively why has it taken us 16 years to reach this point. It is my firm belief that administrative reforms are a piece of the puzzle but they are still just a piece."⁽⁴²⁰⁾

It is the eleventh hour for Superfund, as it languishes on Capitol Hill. The present budget problems have put any renewal or amendment of CERCLA on hold. The Democrats and Republicans must put their differences aside and cross the aisle to work together to reform Superfund. Congress must, at the very least, renew CERCLA's taxing provisions. The idea of starting a "new CERCLA" from scratch is an impossible solution. In reality, Superfund would disappear.

Peter K. Johnson^(*)

1. S. 8, 105th Cong. (1997).

2. Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), Pub. L. No. 96-510 (1980) (codified as amended at 42 U.S.C. § 9601 (1994)).

3. See 141 Cong. Rec. S12678-03 (daily ed. Sept. 6, 1995) (statement of Sen. Pressler) ("We all agree that the current Superfund Program does not work. It is one of the most expensive environmental programs on the books.").

4. Id. "More than 20% of all Superfund dollars get spent in the courtroom, not to clean up the environment." Id. See William N. Hedelman et al., Superfund Transaction Costs: A Critical Perspective on the Superfund Liability Scheme, 21 Envtl. L. Rep. (Envtl. L. Inst.) 10,413, 10,415 (1991). "Transaction costs are the millions of dollars in administrative, legal, engineering, consulting, and other management costs borne by the EPA, private industry, and local governments that do not directly result in cleaning up the waste site but are nonetheless inevitable in establishing liability for cleaning up a site." Id.

5. James Broder, The 99th Congress: Deceptively Productive, Wash. Post, Oct. 22, 1986, at A25.

6. See United States v. Amoco, 889 F.2d 664, 667 (5th Cir. 1989). CERCLA has a "well-deserved notoriety for vaguely drafted provisions and an indefinite, if not contradictory legislative history." Id.

7. 1983 Mass Acts 7; see also Mass. Gen. Laws ch. 21E (1983).

8. See Christopher P. Davis, Chapter 21E Redesigns State's Cleanup Program, Mass. Law. Wkly., Sept. 28, 1992, at 2.

9. See 1992 Mass Acts 133.

10. See infra notes 167-83 and accompanying text.

11. See 42 U.S.C. § 9601(21) (1994). A Potentially Responsible Party (PRP) is a party that has been targeted by the EPA as a party responsible for a hazardous waste site. See id. It can be an "individual, firm, corporation, association, partnership, consortium, joint venture, commercial entity, United States Government, state, municipality, commission, political subdivision of a state, or any interstate body." Id.

12. See In re Acushnet River and New Bedford Harbor, 716 F. Supp. 676, 681 n.6 (D. Mass. 1989) ("[I]t astounds this court that a statute as important as CERCLA . . . remains as inscrutable as ever . . . . [M]uch of it appears to be due merely to poor drafting.").

13. See infra notes 206-14 and accompanying text.

14. See S. 8, 105th Cong., § 501 (1997).

15. See id.

16. See id. §§ 501, 503. "Allocatur--Lat. it is allowed. A word formerly used to denote that a writ or order was allowed. A word denoting the allowance by a master . . . of a bill referred for his consideration, whether touching costs, damages, or matter of account." Black's Law Dictionary 75 (6th ed. 1990). An allocator takes an active role in the discovery process of a claim and then works out an equitable distribution pattern. See Charlene Stukenborg, Note, The Proper Role Of Alternative Dispute Resolution (ADR) In Environmental Conflicts, 19 U. Dayton L. Rev. 1305, 1310 (1994).

17. See infra notes 26-37 and accompanying text.

18. See infra notes 38-84 and accompanying text.

19. See infra notes 85-102 and accompanying text.

20. See infra notes 103-19 and accompanying text.

21. See infra notes 120-205 and accompanying text.

22. See infra notes 206-73 and accompanying text.

23. See infra notes 274-320 and accompanying text.

24. See infra notes 321-401 and accompanying text.

25. See infra notes 402-20 and accompanying text.

26. See 1 Allan J. Topol & Rebecca Snow, Superfund Law And Procedure § 1.1, at 2 (1992).

27. See id.

28. See id.

29. See id.

30. See Robert V. Percival et al., Environmental Regulation: Law, Science and Policy 288 (1992).

31. See id. In 1953, an environmental tragedy occurred in Love Canal, New York. See id. The Hooker Chemical and Plastics Corporation buried hazardous waste on a specific site for years, covering it only with a layer of clay. See id. They transferred title of the contaminated land for one dollar to the Niagara Falls Board of Education. See id. The deed clearly stated that Hooker would not be responsible for any injuries related to the land. See id. A school and 100 homes were built on the site, which became known as Love Canal. See id. In 1978, heavy rains fell and washed away the weak layer of clay covering the waste. See id. The entire settlement became contaminated by a "chemical soup" that seeped into basements of residential homes. Id. "Ultimately, 1,000 families were relocated and homes along the Canal were demolished." Id.; see also Mark Reisch, Superfund Reauthorization Issues in the 104th Congress, Cong. Research Servs. Issue Brief (Apr. 10, 1996), at 2.

32. See Topol & Snow, supra note 26, at 3. With no environmental regulations concerning dumping on the books, one group of "dumpers" filled a large ravine with almost twenty thousand drums filled with hazardous materials. See id. These drums eventually leaked into the soil and tainted area groundwater used for drinking. See id. The area became known as the "Valley of the Drums." See id.; see also Mark Reisch, Superfund Reauthorization Issues in the 104th Congress, Cong. Research Servs. Issue Brief (Apr. 10, 1996), at 2.

33. See 141 Cong. Rec. S9856-01, S9875 (daily ed. Dec. 11, 1980). "CERCLA was passed in the early morning hours of December 3, 1980 by the outgoing Democratic Congress and signed by President Jimmy Carter. `[A]lmost certainly . . . the most expensive environmental program in the history of the United States, or of any other nation.' CERCLA was rushed through congress and the oval office in anticipation of the probable environmental policies of the soon-to-be inaugurated Reagan Administration." Katherine N. Probst & Paul R. Portney, Assigning Liability for Superfund Cleanups: An Analysis of Policy Operations 1 (1992) (quoting Thomas W. Church & Robert T. Nakamura, Cleaning Up The Mess: Implementation Strategies in Superfund 3 (1993)).

34. Percival et al., supra note 30, at 288 ("CERCLA is a direct extension of common law principles of strict liability for abnormally dangerous activities.").

35. See Topol & Snow, supra note 26, at 2 n.6; see also United States v. Reilly Tar & Chemical Corp., 546 F. Supp. 1100, 1111-12 (D. Minn. 1982).

36. See Ian G. John, Too Much Waste: A Proposed Change in the Government's Effort to Cleanup the Nation, 70 Ind. L.J. 951, 955 (1995).

37. Id. at 955 (quoting Church & Nakamura, supra note 33, at 4-5).

38. United States v. Wade, 577 F. Supp. 1326, 1331 (E.D. Pa. 1983).

39. 42 U.S.C. § 9611(a) (Supp. V 1981).

40. See Topol & Snow, supra note 26, at 9; see also 42 U.S.C. § 9611(a) (Supp. V 1981).

41. See 26 U.S.C. § 9507 (1994); see also Topol & Snow, supra note 26, at 9 ("Under the original statute, twelve oil and chemical companies paid seventy percent of the Superfund excise tax."); Superfund Revenue Act of 1985: Report to Accompany S.51 Before the Senate Finance Comm., 99th Cong. 36 (1985).

42. See 42 U.S.C. § 9604 (Supp. V 1981). This authority vested in the president is actually transferred to the EPA via Executive Order; see also Percival et al., supra note 30, at 292.

43. Topol & Snow, supra note 26, at v.

44. See Percival et al., supra note 30, at 290.

45. Id. (quoting Phillip T. Cummings, NEPA to CERCLA: Completing the Circle, 7 Envtl. 6, 11 (1990)). "Instead, the main purpose of CERCLA is to make spills or dumping of hazardous substances less likely through liability, enlisting business and commercial instincts for the bottom line in place of traditional regulation." Id.

46. See Topol & Snow, supra note 26, at 293-94 "Congress intended to create a powerful new incentive for waste reduction and more careful handling and disposal of waste." Id.

47. See id. at 294. "By holding the factually responsible person liable, [the bill] encourages that person--whether a generator, transporter, or disposer of hazardous substances--to eliminate as many risks as possible." Id. (alteration in original) (quoting S. Rep. No. 848, at 33 (1981)).

48. See 42 U.S.C. § 9607(1)-(4) (1994), which defines "covered persons" as:

(1) the owner and operator of a vessel or facility,

(2) any person who at the time of disposal of any hazardous substances owned or operated any facility at which such hazardous substances were disposed of,

(3) any person who by contract, agreement, or otherwise arranged for disposal or treatment, or arranged with a transporter for transport for disposal or treatment of hazardous substances owned or possessed by such person, by any other party or entity, at any facility or incineration vessel owned or operated by another party or entity and containing such hazardous substances, and

(4) any person who accepts or accepted any hazardous substances for transport of disposal or treatment facilities, incineration vessels or sites selected by such person, from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance. . . .Id.

49. 42 U.S.C. § 9601 (9) (1994) defines:

The term "facility" means (A) any building, structure, installation, equipment, pipe or pipeline (including any pipe into a sewer or publicly owned treatment works), well, pit, pond, lagoon, impoundment, ditch, landfill, storage container, motor vehicle, rolling stock, or aircraft, or (B) any site or area where a hazardous substance has been deposited, stored, disposed of, or placed, or otherwise come to be located; but does not include any consumer product in consumer use or any vessel.Id.

50. 42 U.S.C. § 9601 (22) (1994) states that:

The term "release" means any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment (including the abandonment or discarding of barrels, containers, and other closed receptacles containing any hazardous substance or pollutant or contaminant) . . . .

Id.

51. 42 U.S.C. § 9601 (14) (1994) states that:

The term "hazardous substance" means (A) any substance designated pursuant to section 1321(b)(2)(A) of title 33, . . . The term does not include petroleum, including crude oil or any fraction thereof which is not otherwise specifically listed or designated as a hazardous substance under subparagraphs (A) through (F) of this paragraph and the term does not include natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel (or mixtures of natural gas and such synthetic gas).Id.

52. See generally 42 U.S.C. § 9601(1)-(38) (1994) for complete definitions.

53. See 42 U.S.C. § 9607 (1994); see also United States v. Monsanto Co., 858 F.2d 160, 167, 171 (4th Cir. 1988); United States v. Bliss, 667 F. Supp. 1298, 1308-09 (E.D. Mo. 1987); United States v. Chem-Dyne Corp., 572 F. Supp. 802, 810 (S.D. Ohio 1983). The notion of strict liability is taken from the view of nuisance in the Restatement (Second) of Torts which defines nuisance as activity which arises from unreasonable, unwarranted or unlawful use by a person of his own property which injures or endangers the public health, safety or welfare. Failure to maintain the property constitutes a failure to perform a legal duty, actionable at law. See Restatement (Second) of Torts § 886(a) (1984); see also infra notes 206-07 and accompanying text.

54. See 42 U.S.C. § 9607(b)(1)-(3) (1994) which provides the following defenses:

There shall be no liability . . . for a person otherwise liable who can establish by a preponderance of the evidence that the release or threat of release of a hazardous substance and the damages resulting therefrom were caused solely by: (1) an act of God; (2) an act of war; [or] (3) an act or omission of a third party other than an employee or agent of the defendant . . . .Id.

55. See United States v. Bliss, 667 F. Supp. 1298, 1304 (E.D. Mo. 1987); United States v. Conservations Chemical Co., 619 F. Supp. 162, 184 (W.D. Mo. 1985).

56. See Exec. Order No. 12,580; see also 3 C.F.R. §§ 193-200 (1988) (delegating primary responsibility for carrying out Superfund activities from the President to the EPA).

57. See 42 U.S.C. § 9605(8)(B) (1994).

58. See id. § 9605(c)(1) ("[T]he hazard ranking system accurately assesses the relative degree of risk to human health and the environment posed by sites and facilities subject to review.").

59. See id. § 9604(a)(1).

60. See id. § 9606.

61. See id. § 9604; see also Dedham Water Co. v. Cumberland Farms, Inc., 805 F.2d 1074, 1081 (1st Cir. 1986) (interpreting CERCLA to place the ultimate responsibility for cleanup on those responsible for problems caused by the disposal of chemical poisons).

62. See 42 U.S.C. § 9604 (a)(1) (1994). Private party cleanup of hazardous waste sites is invariably less expensive than remedial work performed by the government. See Roseann Oliver, The Intersection of CERCLA and RCRA: What Companies Should Know, 42 Fed'n of Ins. and Corp. Counsel. Q. 445, 449-50 (1992).

63. John, supra note 36, at 960 (citing Jan P. Acton, Understanding Superfund: A Progress Report 11-17 (1989)). The National Contingency Plan is the statutorily defined means for executing a proper cleanup under CERCLA. See 42 U.S.C. § 9605 (1994); 40 C.F.R. § 300 (1996); 40 C.F.R. § 300.700(c)(3)(i), (c)(4) (1996).

64. See 42 U.S.C. § 9607(a)(4)(B) (1994); Anshutz Mining Corp. v. NL Indus., Inc., 891 F. Supp. 492, 495 (E.D. Mo. 1995) (holding that substantial compliance with NCP is necessary for recovery of response costs); Bancamerica Commercial Corp. & Asarco, Inc. v. Trinity Indus., Inc., 900 F. Supp. 1427, 1451-52 (D. Kan. 1995) (citation omitted) (holding that the party seeking recovery of response costs has the burden of showing that the costs incurred were consistent with the NCP); Greene v. Product Mfg. Corp., 842 F. Supp. 1321, 1325 n.7 (D. Kan. 1993) (citation omitted) (holding that the burden of proof to establish compliance with the NCP by a preponderance of the evidence rests with the plaintiffs); see also Robert W. McGee, Should Superfund be Wasted? The Case to Trash the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA), 11 Glendale L. Rev. 120, 122 (1992).

65. See 42 U.S.C. § 9607(a)(4)(B) (1994); 40 C.F.R. § 300 (1996); 40 C.F.R. § 300.700(c)(3)(i), (c)(4) (1996).

66. See 42 U.S.C. § 9622(e) (1994); see also Hedelman et al., supra note 4, at 10,413.

67. See 42 U.S.C. § 9622(e)(1) (1994).

68. See 42 U.S.C. § 9622(e) (1994); see also Hedelman et al., supra note 4, at 10,413.

69. See 42 U.S.C. § 9622(e) (1994).

70. See id. § 9622(e)(2)(B).

71. See id. § 9622(f).

72. See id. § 9622(h)(1).

73. See id. § 9622(i).

74. See id. § 9606(a).

75. See 42 U.S.C. § 9606(a) (1994).

76. See id. § 9607(c)(3).

77. See id. EPA has the ability under § 106 to recover three times the amount it spent and may impose civil penalties of $25,000 per day until cleanup is completed. See id. § 9606(b)(1); see also United States v. Carolina Transformer Co., 739 F. Supp. 1030 (1989), aff'd, 978 F.2d 832 (4th Cir. 1992) (holding defendants jointly and severally liable for three times the response costs incurred by government at site); Hedelman, supra note 4, at 10,413.

78. See 42 U.S.C. § 9607 (a)(4)(C), (f)(1)-(2) (1994). EPA will make themselves or another administrative agency a "trustee" of a location (i.e. woodlands, wetlands, etc.) Id.; see also Hedelman, supra note 4, at 10,413-14. Natural resource recovery claims are the only CERCLA actions where a jury trial is allowed. See generally United States v. R.W. Meyer, 889 F.2d 1497 (6th Cir. 1989).

79. See Hedelman, supra note 4, at 10,415.

80. See Hatco Corp. v. W.R. Grace, 849 F. Supp. 931, 980 (D.N.J. 1994) (citing Regan v. Cherry Corp., 706 F. Supp. 145, 151 (D.R.I. 1989)) (holding that private litigants cannot recover punitive damages under CERCLA).

81. See Percival et al., supra note 30, at 299. "CERCLA was intended 'primarily to facilitate the prompt cleanup of hazardous waste sites by placing the ultimate financial responsibility for cleanup on those responsible for hazardous wastes.'" United States v. R.W. Meyer, Inc., 889 F.2d 1497, 1500 (1989) (quoting Walls v. Waste Resources Corp., 823 F.2d 977, 981 (6th Cir. 1987)).

82. See John C. Cruden, CERCLA Overview, Envtl. Litigation, SA85 A.L.I.-A.B.A. 517, 519-20 (June 24, 1996) ("Congress intended that those responsible for creation of hazardous conditions bear the burden of cleaning up those conditions." (citations omitted)).

83. See id. (citing United States v. Conservation Chem. Co., 628 F. Supp. 391 (W.D. Mo. 1985). "Voluntary private party cleanup of sites is strongly encouraged, as the Fund is insufficient to finance cleanups of all sites and, therefore, must be allocated to those sites where there are no viable potentially responsible parties." Id.

84. 141 Cong. Rec. S14711-01 (daily ed. 1995). "More than 20 percent of all superfund dollars get spent in the courtroom, not to clean up the environment. That translates into an incredible 6.7 million dollars in lawyers fees and court costs per Superfund site." 141 Cong. Rec. S12678-03, (daily ed. Sept. 6, 1995) (statement of Sen. Pressler).

85. See Clean Water Act, 33 U.S.C. § 1251 (1994).

86. See Massachusetts Environmental Law 17 (Massachusetts Continuing Legal Education ed., 1991 & Supp. 1993). The DEP was then known as the Department of Environmental Quality Engineering or the DEQE.

87. Id. at 18. The bill went through drafts and re-drafts until "after months of lengthy and intensive negotiations, the revised bill failed enactment in the 1982 legislative session." Id.

88. Massachusetts Environmental Law, supra note 86, at 11 (citing Michael Nagle, Synopsis of Superfund 1983).

89. Id.

90. Massachusetts Oil and Hazardous Material Release, Prevention and Response Act: 1983 Mass Acts 7; see also Massachusetts Environmental Law, supra note 86, at 19.

91. 1983 Mass Acts 7; see also Massachusetts Environmental Law, supra note 86, at 19.

92. 1983 Mass. Acts 7; see also Mass. Gen. Laws ch. 21E, § 3(b) (1983).

93. Joseph Last, The Superfund Dilemma, Boston Bus. J., Jan. 9-15, 1984, at 29.

94. Mass. Gen. Laws ch. 21E, § 13 (1983).

95. Massachusetts Environmental Law, supra note 86, at 19-20.

96. See id. Unmarketable title "[e]xists where some defect of substantial character exists and facts are known which fairly raise reasonable doubt as to title." Black's Law Dictionary 970 (6th ed. 1990).

97. See Massachusetts Environmental Law, supra note 86, at 19-20 "Freddie Mac wanted non-owner-occupied single-family homes to be exempted from the lien because owner-occupants can become absentee owners after a sale, and the lender has no way of tracking the change. It also wanted multifamily units to be exempted, with concern about the company's unlimited liability should the state seek to recover the cost of a cleanup on a foreclosure site." Id.

98. See id. at 19.

99. See id. at 20.

100. See Mass. Gen. Laws ch. 21E, § 5(h) (1984); see also Massachusetts Environmental Law, supra note 86, at 20.

101. See 1983 Mass. Acts 2046. The bill was enacted on the last day of the 1983 working legislative session and was signed by the governor on Dec. 15, 1983. See id.

102. See Mass. Gen. Laws ch. 21E, § 13 (1983).

103. See Mass. Gen. Laws ch. 21E (1983); see also 42 U.S.C. §§ 9601-9657 (1980) (CERCLA).

104. Garweth Corp. v. Boston Edison Co., 613 N.E.2d 92, 95 (1993) (quoting 1983 Mass Acts 7, emergency preamble) (citing Nassr v. Commonwealth, 477 N.E.2d 987, 992 (1985)). The state superfund goes beyond CERCLA by including oil as a "hazardous substance." Mass. Gen. Laws ch. 21E, §§ 4-5 (1983).

105. See Mass Gen. Laws ch. 21E, § 2 (1983), see also supra notes 49-55 and accompanying text. Release and other words have the same definitions as in CERCLA. See id.; 42 U.S.C. § 9601 (Supp. I 1983). One alteration concerns the nomenclature for the location of the hazardous waste. CERCLA calls it a "facility" while 21E calls it a "site." Compare 42 U.S.C. § 9601(a) (Supp. I 1983) with Mass. Gen. Laws ch. 21E, § 2 (1983). The definition is the same for both words.

106. See Mass. Gen. Laws ch. 21E, §§ 3(a)-(c), 4 (1983); Mass. Regs. Code tit. 310, § 40 (1984). The Massachusetts Contingency Plan is the state version of the NCP; the statutorily defined means for executing a proper cleanup.

107. See 42 U.S.C. § 9605 (1980) [CERCLA].

108. See 42 U.S.C. § 9607 (Supp. IV 1980); Mass. Gen. Laws ch. 21E, § 5(a)-(f) (1983).

109. See Mass. Gen. Laws ch. 21E, § 5(a)(5) (1983) (providing that "any person who otherwise caused or is legally responsible for a release or a threat of release of oil or hazardous material from a vessel or site, shall be liable, without regard to fault. . . . Except as provided in paragraph (b), such liability shall be joint and several."); see also 42 U.S.C. § 9607 (Supp. V 1981).

110. See Mass. Gen. Laws ch. 21E, § 5(a)(5) (1983).

111. Mass. Gen. Laws ch. 21E, § 7(a) (1983) ("As soon as one has knowledge of a release or a threat of release of oil material, [they] shall immediately notify the department thereof.").

112. See id. §§ 8-9.

113. See id. §§ 11-13. "Any liability to the commonwealth under this chapter shall constitute a debt to the community. Any such debt together with interest thereon at the rate of twelve percent per annum from the date such debt becomes due, shall constitute a lien on all property . . . ." Id. § 13.

114. See id. §§ 6-13. Section six states "that the Department of Environmental Quality Engineering is authorized and directed to expend a sum, not to exceed twenty-five million dollars, to be raised by the sale of notes and bonds authorized by sections seven and eight of this act, for the purpose of carrying out the actions authorized by section four of chapter twenty-one E of the General Laws." See 1983 Mass. Acts 7, 13, § 6.

115. Compare 42 U.S.C. §§ 9601 (Supp. I 1983) with Mass Gen. Laws ch. 21E (1983); see also Dedham Water Co. v. Cumberland Farms Dairy, Inc., 889 F.2d 1146, 1156 (1st Cir. 1989) (holding that Chapter 21E is patterned after CERCLA); Acme Laundry Co. v. Secretary of Envtl. Affairs, 575 N.E.2d 1086, 1092 (Mass. 1991) (agreeing that CERCLA is in many ways analogous to 21E); Sheehy v. Lipton Indus., Inc., 507 N.E.2d 781, 786 (Mass. 1987) (explaining that CERCLA is the federal analogue to chapter 21E).

116. See 42 U.S.C. § 9611(a) (Supp. V 1981); Mass. Gen. Laws ch. 21E, § 6 (1983).

117. See 42 U.S.C. § 9605 (Supp. V 1981); Mass. Gen. Laws ch. 21E § 3(a)-(c) (1983).

118. See 42 U.S.C. §§ 9606, 9607, 9613 (Supp. V 1981); Mass. Gen. Laws ch. 21E, §§ 8, 9, 13 (1983).

119. See Topol & Snow, supra note 26, at 12; see also Massachusetts Environmental Law, supra note 86, at 20.

120. Phillip D. Reed, CERCLA 1985: A Litigation Update, 15 Envtl. L. Rep. (Envtl. L. Inst.) 10,395, 10,406 (1985).

121. See Conference Committee Report: Superfund Amendments and Reauthorization Act of 1986, H.R. Conf. Rep. No. 962 (1986).

122. See Topol & Snow, supra note 26, at 13.

123. See id. at 12.

124. See Massachusetts Environmental Law, supra note 86, at 7.

125. Id. (citing David Bishop, GAO Report, EPA's Efforts to Cleanup Three Hazardous Waste Sites (June 1984)); see also Ed Magnuson, A Problem That Cannot Be Buried; the Poisoning of America Continues, Time, Oct. 14, 1985, at 76-84.

126. Robert Atkeson et al., Superfund Deskbook, An Annotated Legislative History of SARA 1986, Envtl. L. Rep. (Envtl. L. Inst.) 7 (1986).

127. See Topol & Snow, supra note 26, at 13. PRPs were pushing for removal of joint and several liability from the statute. See id.

128. See id. at 15.

129. See, e.g., Michael Weisskopf, Mr. President Please Sign Superfund, Wash. Post, Oct. 10, 1986, at A24.

130. See Topol & Snow, supra note 26, at 15.

With regard to the terms of the new statute, despite the fact that EPA and PRP's were intimately familiar with the problems of CERCLA enforcement, congress chose to ignore the suggestions of both groups. Instead, congress devised its own adjustments for the Superfund program. Though characterizing its task as a `clarification' and `fine tuning' of the previous law, congress went to work amending the statute with a sledge hammer as opposed to a chisel.Id.

131. Superfund Amendments and Reauthorization Act of 1986 (SARA), Pub. L. No. 99-499, 100 Stat. 1613.

132. See Atkeson et al., supra note 126, at 5; see also Michael Weisskopf, Reagan Signs Superfund Bill, Wash. Post, Oct. 18, 1986, at A1.

133. See Robert H. Abrams, Superfund and the Evolution of Brownfields, 21 Wm. & Mary Envtl. L. & Policy Rev. 265, 271 (1997) ("[A] popular saying evolved that SARA had been misnamed and that her name was really RACHEL, the Reauthorization Act Confirms How Everyone's Liable."); Thomas G. Kessler, Comment, The Land Recycling and Environmental Remediation Standards Act: Pennsylvania Tells CERCLA Enough is Enough, 8 Vill. Envtl. L.J. 161, 170 (1997); Topol & Snow, supra note 26, at 16.

134. See Atkeson et al., supra note 126, at 9 ("Establishment of detailed new mandatory cleanup standards in CERCLA section 121 is by far the most important change made by SARA.").

135. See id.; see also 42 U.S.C. § 9621(b)(1) (Supp. IV 1986) (stating that remedial actions, in which treatment that permanently and significantly reduces the volume, toxicity or mobility of the hazardous substances, pollutants, and contaminants is a principal element, are to be preferred over remedial actions not involving such treatments).

136. See 42 U.S.C. § 9621(b) (Supp. IV 1986).

137. See Atkeson et al., supra note 126, at 10; see also 42 U.S.C. § 9621 (Supp. IV 1986).

138. See 42 U.S.C. § 9621(f)(1) (Supp. IV 1986). "The President [EPA] shall promulgate regulations providing for substantial and meaningful involvement by each State in initiation, development and selection of remedial actions to be undertaken in that State." Id.

139. See id. § 9621(f)(1)(A)-(E).

140. See id. § 9611(a).

141. See Topol & Snow, supra note 26, at 15. Previously, the tax only applied to companies directly involved with hazardous waste (such as oil and petroleum companies). See supra notes 39-41 and accompanying text.

142. See Topol & Snow, supra note 26, at 15.

143. See id.; see also 42 U.S.C. § 9616 (Supp. IV 1986). SARA also created a new, independent regulatory program: The Emergency Planning and Community Right-To-Know-Act. See John C. Cruden, CERCLA Overview, SA85 A.L.I.-A.B.A. 517 (May 1996) (citing 42 U.S.C §§ 11001-11050 (Supp. IV 1986)). This new section provides for criminal sanctions for non-reporting of known hazardous waste sites. See 42 U.S.C. § 9603(b) (1986).

144. See 42 U.S.C. §§ 9622, 9613(f)(1) (1988). Contribution is an equitable remedy that spreads the burden of satisfying a plaintiff's judgment among defendants. See W. Page Keeton et al., Prosser & Keeton on the Law of Torts § 50 (5th ed. 1984).

145. See 42 U.S.C. § 9613(f)(1) (1988).

146. See id. § 9607.

147. See id. § 9622(b) & (c) (the statute is vague as to any guidelines).

148. See id. § 9617(a).

149. Topol & Snow, supra note 26, at 16 (construing 42 U.S.C. § 9617(a) (1988) which made the notice and comment period mandatory).

150. See Topol & Snow, supra note 26, at 16; see also 42 U.S.C. § 9613(h) (1988).

151. See 42 U.S.C. § 9613(h) (1988).

152. See H.R. Rep. No. 253, at 78 ("[N]othing in this bill is intended to change the application of the uniform federal rule of joint and several liability.").

153. See Topol & Snow, supra note 26, at 16; see also Superfund Amendments and Reauthorization Act of 1986 (SARA), Pub. L. No. 99-499 (1986).

154. See Topol & Snow, supra note 26, at 16.

155. See id.

156. See Massachusetts Environmental Law, supra note 86, at 20.

157. Beacon Hill is the location of the Massachusetts State House and Capitol.

158. See Massachusetts Environmental Law, supra note 86, at 20.

159. MassPIRG is a "non-profit, consumer advocacy organization with over 170,000 members statewide." Susan Roberts Boyle, Legislative News, Mass. Law. Wkly., July 13, 1992, at 7.

160. Mary K. Ryan, The Hazardous Waste Cleanup Problem in Massachusetts: Why Question 4 Was Needed, MassPIRG Background Paper No. 1, 1987.

161. See Massachusetts Environmental Law, supra note 86, at 20.

162. Id. at 23.

163. See id.

164. See id.; see also Mass. Gen. Laws ch. 21E, § 3A (1987).

165. Mass. Gen. Laws ch. 21E, § 3A (1987).

166. See Mass. Gen. Laws ch. 21E, §§ 14-18 (1988). The bill was enacted and signed by Governor Dukakis on July 3, 1987. See 1987 Mass Acts 642. The DEP's authority is now the same as the EPA's under CERCLA § 104. See supra notes 56-65 and accompanying text. Chapter 21E § 2 defines the following terms:

A "response action contract" is any contract relating to the provision of service to assess, contain or remove oil or hazardous material which is entered into on or after the effective date of this definition between the commonwealth or any agency thereof, and a response action contractor.

A "response action contractor" or "contractor," is an individual, partnership, corporation, association, joint venture or other commercial entity which enters into a response action contract with the commonwealth or any agency thereof and includes any such entity acting as a subcontractor to the primary response action contractor where such entity is performing services relating to the response action contract.Id.

167. See Massachusetts Environmental Law, supra note 86, at 21.

168. See id. at 23.

169. See Paul C. Nightingale, Changes to Chapter 21E: A New Approach to Waste Site Cleanups, Summary of the Chapter 21E Amendments 1 (Mass. Bar Ass'n ed. 1992).

170. Id.

171. Massachusetts Environmental Law, supra note 86, at 4.

172. See id.

173. See id.; see also Nightingale, supra note 169, at 1.

The effort to redesign Chapter 21E resulted from widespread agreement that the program was not accomplishing its primary objective of getting waste sites cleaned up. Frustration over bureaucratic delays, excessive costs and widespread inaction, even at heavily contaminated sites, combined with the budget squeeze on DEP and state government in general, resulted in a comprehensive re-evaluation of the Commonwealth's approach to the waste site cleanup process.Id.

174. See Mass. Gen. Laws ch. 21E, §§ 3(d)(6), 19(a)-(j) (1992).

175. See id. § 3(d)(6) (1992); see also Massachusetts Environmental Law, supra note 86, at 22.

176. See Mass. Regs. Code tit. 310, § 40.000 (1995) (Mass Contingency Plan); Mass. Regs. Code tit. 309, § 1.00-8.00 (1995) (Governing Regulations for LSP Board); see also James D. Okun, LSP, The Role of the Licensed Site Professional, G.L. Chapter 21E Basics (MCLE ed. 1995) ("A Licensed Site professional is an individual who meets the education and experience requirements established by the Board of Registration of Hazardous Waste Cleanup Professionals."). LSPs are usually engineers and scientists who are involved with cleanup of hazardous waste. See id.; see also Nightingale, supra note 169, at 11.

177. See Nightingale, supra note 169, at 3. The important components of the Amendments include the following:

--Establishment of licensed site professionals;

--Establishment of cleanup permits and fees;

--Fundamental restructuring of DEP's role in the cleanup process;

--Enhancement of DEP's enforcement authority;

--Important revisions to administrative procedures and standards of judicial review;

--Liability limitations for innocent owners and operators, secured lenders and fiduciaries, one-to-four-family residential property owners, and certain state agencies and public utility companies;

--New statute of limitations;

--Authorization for DEP to impose property restrictions, and

--Requirements for DEP to promulgate regulations concerning various aspects of the new program.Id. The Legislature also added section 4A, which created a mandatory prelitigation claims procedure for private claims of contribution. See Mass. Gen. Laws ch. 21E, § 4A (1992).

178. See 1992 Mass Acts 294.

179. Mass. Gen. Laws ch. 21E, § 4 (1990).

180. Id. §§ 4, 4A(a).

181. Id. § 4A.

182. See Massachusetts Environmental Law, supra note 86, at 29; see also Mass. Gen. Laws ch. 21E, § 5 (1994).

183. Nightingale, supra note 169, at 7; see also Mass. Gen. Laws ch. 21E, § 5(b) as amended in 1992. A current owner or operator who did not own or operate a site when a release occurred and did not contribute to it in any way, shall not be liable for damages. See id. But, "[c]urrent owners or operators are still liable to the Commonwealth for up to the value of the property after the cleanup is completed." Id.

184. See 1994 Mass. Acts 252.

185. See generally Mass. Gen. Laws ch. 21E, § 2 (1995).

186. See id. § 7, which states:

Any owner or operator of a site or a vessel, and any person otherwise described in paragraph(a) of section five, and any fiduciary, city or town, or secured lender who holds title to a possession of a site or vessel, as soon as he has knowledge of a release or threat of a release of oil material shall immediately notify the department thereof.Id. (emphasis added).

187. See Mass. Regs. Code tit. 310, § 40.000 (1995) (Mass Contingency Plan); Mass. Regs. Code tit. 309, § 1.00-8.00 (1995) (Governing Regulations for LSP Board).

188. See Mass. Regs. Code tit. 310, § 40.000 (1995).

189. See Rec