EPA DRAFT EARLY TRANSFER POLICY

[Lenny Siegel <lsiegel@igc.org>]

EARLY (DIRTY) TRANSFER POLICY

U.S. EPA is developing a policy to implement Section 334 of the Defense
Authorization Act of 1997, which modified CERCLA (Comprehensive
Environmental Response, Compensation, and Liability Act) Section 120(h)
to permit "The Transfer of Federal Property by Deed before All Necessary
Response Action Has Been Taken." Technically, approval is the deferral
of the Section 120(h)(3) requirement that "all necessary remedial action
has been taken." Though the most frequent application of the policy will
be at closing military bases, it applies to property owned by all
federal agencies.

Under the legislation, the Governor of the State in which such a
transfer takes place must approve such a transfer and, if the federal
facility is on the "Superfund" National Priorities List, EPA must
approve the deferral as well. EPA's policy, even when adopted, will not
be binding on the states, but it is expected to provide a model to the
Defense Department, other agencies seeking to transfer contaminated
property, and state regulators.

The purpose of the policy is to carry out the following: "Parcels of
real property where the anticipated reuse is reasonably expected to
result in exposuree to CERCLA hazardous substances are not appropriate
candidates for transfer pursuant to this policy, unless sufficient
information is available to support a determination that the risks to
human health and the environment associated with the period during which
the CERCLA Covenant is proposed to be deferred is acceptable to EPA, the
state, and the community."

EPA invented two new documents required to make deferrals happen. The
first, the Parcel Deferral Proposal (PDP) , will describe the property
and contamination and argue that the planned use of the property will
not unacceptably threaten human health and the environment and that the
transfer and use will not encumber necessary cleanup activities. 

To justify such conclusions, EPA will require the collection of data of
RI (remedial investigation) quality. The draft policy says, "In many
cases the RI need not be complete, however, for some proposed reuses,
such evaluation may not be possible without complete characterization of
the property proposed for transfer." In addition to requiring "an
analysis of the risks associated with likely future uses" EPA will also
require the evaluation of the risks associated with unrestricted future
land use.

The analysis will include an evaluation of environmental suitability, a
listing of specific proposed restrictions (institutional controls), and
an estimate of the length of time for the completion of cleanup - that
is, how long before the CERCLA covenant can be signed.

The second document is the Environmental Response Obligations Addendum
(EROA), which must be included in the sale contract or any other
agreement covering transfers to a no-federal entity. [Section 120(h)(3)
does not apply to transfers within the federal government.] This
document will legally impose the deed restrictions proposed in the PDP
to protect the public, the environment, or cleanup activities: "Land use
restrictions, if required, shall reflect discussions among the reuse
entity and the community, the Transferring Federal Agency, and the
appropriate federal, State, local and Tribal regulatory agencies."

The EROA is also to include assurances that either the Transferring
Federal Agency or the Transferee have the will and the resources to
carry out necessary responses. EPA wants the schedules for such activity
defined up front: "Except in extraordinary circumstances, EPA will not
support early transfers for NPL-sites that do not have signed FFAs
[Federal Facility Agreements] or IAGs [Inter-Agency Agreements]."

To promote public involvement, the draft policy says: "The Draft PDP

shall be made available to the Restoration Advisory Board, Site Specific
Advisory Board, and/or other community-based group and notice of the
availability of the Draft PDP shall be provided by publication in a
newspaper of general circulation. The public shall be provided with a
period of not less than thirty (30) days to submit written comments
regarding the Draft PDP." The final PDP, written by the proposing agency
(such as the Defense Department) must include a response to all
comments.

EPA is making a good faith effort to make the early transfer option
work. Given the wording of the legislation, it's hard to envision
significant improvements in the process. At most proposed early
transfers - particularly the early, easy proposals - problems should be
minimal. But I don't see anything in the draft policy that resolves the
problems that many of us feared in opposing Section 334. What happens if
major new problems are discovered after the transfer is approved? What
if the Transferring agency and the regulators end up with serious
differences over the nature or timing of the cleanup. Under those
circumstances, once a transfer is approved, it will be difficult to
influence cleanup decisions unless the transferring agency and the
transferee are open to change.

Lenny Siegel

Lenny Siegel
Director, SFSU CAREER/PRO (and Pacific Studies Center)
c/o PSC, 222B View St., Mountain View, CA 94041
Voice: 650/961-8918 or 650/969-1545
Fax: 650/968-1126
lsiegel@igc.org