EARLY TRANSFER POLICY

[Lenny Siegel <lsiegel@igc.org>]

CALIFORNIA'S DRAFT EARLY TRANSFER POLICY

Last year Congress enacted, in the Fiscal Year 1996 Defense 
Authorization Act (Section 334), a change in the Superfund law (CERCLA) 
allowing the early transfer of contaminated federal property to 
non-federal entities. (I used the term "dirty transfer" during the 
debate.) The final legislation placed conditions upon such transfer, 
requiring the approval of the U.S. EPA administrator for the transfer 
of property on the Superfund National Priorities List (NPL) and the 
approval of the governor of the state in which the property is located 
in all cases - whether or not the facility is on the NPL - of early 
transfer. 

Cal-EPA's Department of Toxic Substances Control is circulating a 
preliminary draft policy and procedure to implement that legislation. I 
expect a period of negotiations among California, the Defense 
Department, U.S. EPA, other states, and community representatives 
(including local governments) before the policy is finalized. I also 
believe that California, with its high concentration of closing 
military bases and established tradition of environmental oversight, is 
creating a model likely to be copied or adapted by other states.

The current version suggests that early transfers will be subject to 
the same level of regulatory oversight as other important cleanup 
decisions. In fact, because California wants those other decisions made 
first, it will be difficult to rush through early transfers if this 
policy is adopted as written. That's a good thing. 

I wonder, given the effort that has gone into this change in law and 
procedure, where the demand for early transfers has come from. If any 
one knows of facilities where such transfers are likely to be 
considered, I would like to hear of it.

Section 120 (h) (3) of CERCLA, the (Comprehensive Environmental 
Response, Compensation, and Liability Act of 1980, as amended) requires 
that the deed of transfer for federal property to a non-federal entity 
include a covenant warranting that all remedial action necessary has 
been put into place before the transfer. Section 334 creates conditions 
under which that covenant may be deferred. 

California's draft policy states, "where the nature and extent of 
contamination is unknown, risks not assessed, and/or the proposed reuse 
not identified [properties] are not appropriate candidates for [early] 
transfer under this policy." 

The Department of Toxic Substances Control (DTSC), the state's lead 
hazardous waste regulator, will carry out the responsibilities of the 
Governor with respect to early transfer, and the Division Chief of the 
DTSC Office of Military Facilities will have the responsibility for 
signing letters of determination.

Among the specific provisions of the draft California policy:

DTSC will work with the Local Reuse Authority (LRA) to evaluate the 
proposed reuse of the property.

DTSC will ensure that the deed of transfer contains necessary use 
restrictions and guarantees of access for remediation and oversight. 
Where financial responsibility for cleanup remains in federal hands, 
the deed should also contain assurances that the Defense Department (or 
other federal property owner) will submit budget requests (to the 
Office of Management and the Budget) sufficient to meet cleanup obligations.

Early in the process, (at least at closing Defense installations) the 
BRAC (Base Realignment and Closure) Cleanup Team (BCT), usually made up 
of representatives from the military department, DTSC, and U.S. EPA, 
will hold a scoping meeting to decide in concept whether early transfer 
would be protective of human health and the environment. (I just love 
those double acronyms!)

Then the Defense Department is supposed to prepare a draft Finding of 
Suitability for Early Transfer (FOSET, presumably pronounced "faucet"), 
modeled after the Finding of Suitability for Transfer already used in 
base closure situations. For the state to approve the FOSET, the 
following criteria should be met, but DTSC leaves room for exceptions 
as long as human health and the environment are protected:

1. "the parcel to be transferred must be sufficiently characterized, so 
that the nature and extent of contamination of all media are known, and 
risks to human health and the environment are identified. The 
anticipated remedy should have been selected, with attendant costs 
delineated for remediation and any long-term operation and maintenance 
(O&M). Schedules should be in place for development of the remedial 
design and implementation of the remedy."

2. "A finalized and approved Reuse Plan should be in place which 
clearly shows the intended use of the specific parcel for 'early' 
transfer, and the uses for all adjacent and associated base 
property.... The Reuse Plan must contain sufficient detail so that DTSC 
can determine whether or not the risks from remaining contamination are 
acceptable and compatible with the proposed reuse for parcels included 
in deferral requests." The Local Reuse Authority should finalize its 
Environmental Impact Report under that California Environmental Quality 
Act and the federal agency should complete its obligations under the 
National Environmental Policy Act, including a property disposal Record 
of Decision.

3. "A land use restriction covenant instrument should be drawn up 
[among] the federal entity, DTSC, and the LRA with the restrictions 
contained in the FOSET. This instrument should define each of the 
parties' responsibilities .... The [deed] restrictions will run with 
the land, and the transferee will be subject to those restrictions, 
until such future time as they may be modified or released." DTSC 
suggests that the deed also contain a reversionary clause, in which the 
federal government would require that the contaminated area be 
transferred back to the federal government if the response action is 
substantially delayed.

4. An enforceable document detailing the remediation schedule should be 
in place. BRAC funding requests should cover the direct environmental 
response as described in that document, as well as regulatory oversight 
and continuation of the Restoration Advisory Board (RAB). The document 
may be an amendment to the Federal Facilities Agreement (for facilities 
on the NPL) signed by U.S. EPA, one or more state agencies, and the 
military department. It may be a state-military Federal Facility State 
Response Agreement (for non-NPL facilities), or it may be another 
enforceable agreement. The document should be subject to reasonable 
schedule revisions with the concurrence of all signatories.

In addition to the 30-day public comment period required by Section 334 
before a deferral is finalized, DTSC proposes that the RAB at a 
property where early transfer is proposed have the opportunity to 
comment on the draft FOSET during the 60 days in which regulatory 
agencies are reviewing the document. The draft policy states: 
"Community acceptance and approval is part of the CERCLA process. 
Serious public objection to the deferral proposal will result in 
reconsideration by DTSC of the efficacy and appropriateness of deferral 
approval."

In addition, the FOSET and enforceable cleanup agreement "must contain 
assurances that the transfer and deferral of real property will not 
substantially delay any necessary response action(s) at the property.

Oversight, of course, does not terminate with early transfer. It only 
ends when remediation has been completed. The draft policy states: "A 
post-remediation human and/or environmental health risk assessment 
(HRA) should be conducted as appropriate after implementation of the 
remedial action to determine if cleanup goals were accomplished, if any 
new or ongoing institutional controls are necessary, and if future 
Operations and Maintenance (O & M) activities are required. Completion 
of all necessary response actions must be approved by the appropriate 
regulatory agencies, along with completion of all required CERCLA 
procedures and documents." 

Finally, with the concurrence of regulators, the federal agency "shall 
execute and deliver to the Transferee an appropriate document 
containing a warranty that all necessary response actions have been 
taken." That is, regulators still must approve the timetable for 
cleanup, and the covenant which was deferred under the early transfer 
provision still must be issued at the end of the process.

Lenny Siegel