Re: [CPEO-BIF] When. where, and how? - continuing the debate

["Walsh, William" <WALSHW@pepperlaw.com>]

Up to the last two e-mail, I thought that there was a reasonable
consensus forming, but alas, it is not to be.

I tend to agree more with Mr. Samford's caveats and concerns.  I served
on the National Academies of Science Committee that produced the report
on Alternatives to Groundwater Clean Up and several similar NAS studies
sponsored by the Navy.  First, there is simply not enough money in the
world to remove every source.  Second, the risk from the removal process
is likely to be greater than the residual risk from containment. Third,
there is no technology to remove DNAPL, particularly in bedrock.
Finally, removal for metals (a significant portion of the material at
most sites) is simply being move from one location where it must be
managed to another location where it must be managed.  

There is no easy answer to addressing these sites.  Small, easy to
remove sites may make economic sense to remove, but I see no reason to
compel removal.  

I thought that the consensus we were heading towards included the
following.

First, there should be rules for making a remedy decision, but the
decision is up to the developer as long as the rules are found.

Second, consensus rules should be able to be reached --- perhaps more
stringent than I would draft, but not mandated source removal.

Third, voluntary cleanups that follow the rules and that are subject to
proper oversight should be encouraged. 

Fourth, as someone noted, getting proper oversight is the key and it is
not easy.   There is no world (regardless of the state of the economy)
where the government mandates all of the cleanups.  As Barry and I can
tell you from our enforcement days, there is not enough resources in
Democratic Administration nor in Republican.  In my view, the better
scheme (as well as the one that must be used of necessity) is to have
the government oversee voluntary programs.  That does not mean every
cleanup needs to be submitted for review (there simply are no
resources).  Just as in industry, quality control programs are developed
that do not test to destruction every product, there are criteria that
can be developed to describe a model oversight program.  There may be
types of sites, locations, or enforcement history that goes into
deciding when, how often, and how detailed a review is done.  In my
experience, the benefit of public involvement is to watch the
regulators, not to solicit a remedy selection from the public.  

The hardest issue is whether or how to "guarantee" funding.  I am afraid
that there is no guarantee, at least no better guarantee than Thomas
Jefferson's adage that the price of liberty is everlasting vigilance.
The price of protecting public health is also everlasting vigilance.
Science changes, mistakes are made, and no system is fool proof.  I
think pretending that it is other wise actually decreases vigilance.

Finally, while the system should be designed to detect and prevent bad
apples, it becomes counter productive when the system is overdesigned.
There are benefits to the private sector approach and any oversight
should be balanced and periodically reviewed to make sure that it is
working. 


William J. Walsh
Pepper Hamilton LLP
600 Fourteenth Street, NW
Suite 500
Washington, D.C.  20005
(202) 220-1424 -direct
(202) 220-1665 - fax
walshw@pepperlaw.com


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> --- Begin Message ---
> Based on your numbering (below):
>
> 1. aaargh. I'm not even going to consider purchasing a piece of commerical real estate under the constraint of being forced to do sampling if there is a suspicion of a release. I MAY choose to, or I MAY choose to walk. That MUST be MY decision. Not YOURS.
>
> 2. Historical contamination that meets reportable thresholds is already required to be reported when discovered.
>
> 3. Secured creditor exemptions are designed to facilitate loans and distinguish between lenders who have engaged in active management and those that don't. Your suggested revision would pretty much doom commercial mortgages. Why would we do that? The liability belongs with the owner/operator who released the contaminants, not with the bank.
>
> 4. See previous posts
>
> 5. Have to get educated regulators hired. States don't have the staff to enforce things now.....
>
> 6. Not sure what this means.
>
> 7. Requiring source removal obviates the risk-based approach. Why remove the source area if a) other alternatives such as treatment in-situ or b) "natural attenuation" meet risk-based goals? Why calculate risk? Don't understand the nexus between groundwater and water resources under a climate change scenario. We'll be better off treating sea-water for drinking purposes.
>
> 8. dis-incentive to developers who need to put up their money, sell the property, and get out.
>
> 9. Or at the very least some way of easily tracking where they are and who is responsible for them.
>
> 10. Incentive for a state to do all that?
>
> --------------------------------------------
> 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)
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>
> -----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
>
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>
>
> -----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
>
>
>
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