From: | "Schnapf, Lawrence" <Lawrence.Schnapf@srz.com> |
Date: | Tue, 28 Apr 2009 14:51:31 -0700 (PDT) |
Reply: | cpeo-brownfields |
Subject: | Re: [CPEO-BIF] When. where, and how? - continuing the debate |
With all do respect, some of your comments are just the parade of horribles. Based on your numbering (below): 1. The quid pro quo for liability relief should be to sample to see what is in the ground or groundwater so decisions can be made on what is best for the community. If the purchaser would otherwise qualify for on of the liabity defenses, the state would have the decision to take on long-term remediation, not owner. Of course, if you don't want liability relief, then certainly free not to sample. THE MARKETPLACE WILL ADJUST TO NEW PLAYING RULES. 2. CERCLA Reportable quantities (RQs)are expressed in quantity per 24 hours-admittedly some states do not have this archaic approach in which case my suggestion would not apply to that state. I It is rarely possible to determine how much volume was discharged over a 24 hour period for a release that occurred decades ago.Thus, purely historical contamination goes unreported. RQs made sense in 1970s when we had lots of mismangement scenarios but now overwhelming number of contaminated sites are from contamination that occurred decades ago (no current releases). My suggestion is that the cleanup standard becomes the reporting obligation. If one finds contamination above applicable cleanup standards, it has to be reported. 3. The lender suggestion was difficult for me but lenders have become surrogate regulators in our de-regulatory model and facilitated the horrible phase 1 reports that missed lots of contamination by hiring the commodity shops. Lenders did not care since they were selling the loans. The secured creditor exemption was intended for banks that hold loans on their books and manage the loans-not those that cobble together risky loans and spread them like a disease across the world. If a borrower goes belly-up when they default on a risky loan, between the taxpayers and the lender, I think the lender that did not engage in proper risk management, should pay the price. AGAIN, THE MARKET WILL ADJUST. 4. see above. 5. State doesn't have to educated regulators, just hire some of the 3,000 recently unemployed lawyers to bring enforcement actions against owners and LSPs for not complying with reporting obliigations. 6. Sorry about the shorthand. EPA should issue regulation describing steps that it believes constitutes "due care" (for TP defense) or appropriate care/reasonable steps for BFPP and CPO liability protections. Better than letting the courts or commodity-shop consultants decide. 7. Ok. Maybe in-situ treatment would work. My point is that owner should eliminate the source of the contamination so that the water can clean itself up over a reasonable amount of time so that future generations can use it if need be. I am not suggesting they do full-fledged long-term remediation where they would qualify for one of the landowner liability protections. We should not be writing off groundwater when future generations are going to need to use that water due to water scarity caused by climate change. This is immoral from an intergenerational standpoint. Just as lame as our grandfathers discharging wastewater into unlined lagoons. 8. Financial assurance is critical to ensuring that IC/ECs are maintained. Developers should not be able to foist IC/ECs on condo associations without adequate resources for them to administer and enforce. 9. Agreed 10. The incentive for the state is that it gets control of its own program-just like CAA, CWA and RCRA. -------------------------------------------- W. Jerrold Samford, P.G. Environmental Compliance Specialist Troutman Sanders, LLP 1001 Haxall Point Richmond, Virginia 23219 (804) 697-2225 (direct) (804) 698-6451 (fax) ~~~~~~~ Effective January 2009, Troutman Sanders will operate offices in Chicago, San Diego and Orange County, as well as have an expanded presence in Washington, DC as part of the addition of Ross, Dixon, and Bell LLP. Learn more at www.troutmansanders.com ~~~~~~~~~~~ This e-mail message and its attachments are for the sole use of the designated recipient(s). If you are not a designated recipient of this message, please notify the sender by replying to this message and delete or destroy all copies of this message and attachments. -----Original Message----- From: brownfields-bounces@lists.cpeo.org [mailto:brownfields-bounces@lists.cpeo.org] On Behalf Of Schnapf, Lawrence Sent: Tuesday, April 28, 2009 1:43 PM To: reshen@mindspring.com; Walsh, William; lsiegel@cpeo.org; Larry Schnapf Cc: Brownfields Internet Forum Subject: Re: [CPEO-BIF] When. where, and how? - continuing the debate In an ideal world, the regulators would supervise all the cleanups butwe will be living in an era of constrained budgets and limited government resources for quite awhile. Thus, I have to swallow hard and grudgingly admit that the future is probably going to be voluntary cleanups conducted by licensed professionals that are audited by the government. The key to me is to make sure we have robust programs that do not incentivize a race to the bottom but instead encourage better quality cleanups. I believe a key to this approach is greater transparency. If I was king, following would be my top ten reforms that I think could accomplish these goals: (1) revise AAI to require phase 2 reports when RECs or releases are identified; (2) reporting of historical contamination when discovered so we no longer have "no hunt" or "no look" contracts (may require amending CERCLA 103(C); (3) Revise lender liability so that banks that originate and sell loans like CMBS do not qualify for secured creditor exemption as they are not holding "indicia of ownership" primarily to proect security interest but instead are being driven by fee profits (but allowed to assert applicable CERCLA LLPs); (4) a database of phase 2 reports both to provide enhance community information, oversight of the regulators/regulated and reduce transactional costs for future deals; (5) strong enforcement focus and penalties for non-disclosure; (6) An AAI-like rule for Continuing Obligations; (7) Source removal for groundwater contamination as part of any risk-based cleanup approach as water resources are going to be the KEY concern for climate change; (8) Financial assurance for all post-remedial obligations exceeding two years; (9) Periodic Compliance Monitoring For IC/EC (likely privatized as well);and (10)EPA should be required to certify that state remedial programs qualify as "state response programs" under CERCLA 128 as it is currently ambiguous if a EPA is required to officially "bless these programs. EPA delegates other environmental programs to states and given the growing importance of state voluntary cleanup programs it seems important that EPA ensures these programs or their LSP programs are sufficiently robust. States would have to adopt the minimal CERCLA reforms above to be designated a "state response program". Larry -----Original Message----- From: Bruce-Sean Reshen [mailto:reshen@mindspring.com] Sent: Tuesday, April 28, 2009 12:40 PM To: Schnapf, Lawrence; 'Walsh, William'; lsiegel@cpeo.org; Larry Schnapf Cc: 'Brownfields Internet Forum' Subject: RE: [CPEO-BIF] When. where, and how? - continuing the debate Larry, Your email has finally shifted the debate. We are no longer debating voluntary programs vs. what Lenny refers to as compliance-based regulatory programs. The issue is whether or not our society is willing to understand and fund regulatory oversight, no matter what we call the program. Without such funding for oversight, the unscrupulous among us will evade their responsibilities. Most compliance-based programs incorporate such oversight, but are chronically under funded and unable to effectuate their mission. Most voluntary programs need stronger oversight mandates as well as increased funding. Note the NJ DEP program that on paper is excellent. However, a self-study showed that a huge number of participants simply never filed or inadequately filed the required forms and no one noticed. We are not talking bad regulators, we are simply observing the impact of inadequate funding. No program can be effective without proper funding. This is actually the major issue before us. Bruce Bruce-Sean Reshen p. 203-259-1850 c. 917-757-5925 This communication may contain information that is legally privileged, confidential or exempt from disclosure. If you are not the intended recipient, please note that any dissemination, distribution or copying of this communication is strictly prohibited. Anyone who receives this message in error should notify the sender immediately by telephone or return email and, delete the message from their computer. -----Original Message----- From: Schnapf, Lawrence [mailto:Lawrence.Schnapf@srz.com] Sent: Tuesday, April 28, 2009 11:41 AM To: Walsh, William; lsiegel@cpeo.org; Bruce-Sean Reshen Cc: Brownfields Internet Forum Subject: RE: [CPEO-BIF] When. where, and how? - continuing the debate The key statement in William Walsh's email is the following: "I believe that voluntary clean up programs if properly overseen will result in more expeditious cleanup, less costly clean up, without the cleanup being inadequate (or secret)" I agree with that statement. The critical question to me is how best can we accomplish or incentivize that outcome. We have seen that the market cannot discipline itself and will unleash the "animal spirits" if not properly regulated. Without proper controls, there's just the law of the jungle because there is greed. Greed has to be tempered by fear and regulation. I think we need to move back towards more oversight. That does not mean telling developers how many holes to dig or where to dig them but to make sure that sites are properly characterized and remediated. Larry ************************************************************************ ***** U.S. Treasury Circular 230 Notice: Any U.S. federal tax advice included in this communication was not intended or written to be used, and cannot be used, for the purpose of avoiding U.S. federal tax penalties. ************************************************************************ ***** NOTICE This e-mail message is intended only for the named recipient(s) above. 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