Thank you for this opportunity to join you. I suspect that you asked me here primarily for two reasons: first, I am the Chairman of the Senate Committee on Environment and Public Works, which does have jurisdiction over legislation dealing with victim compensation for environmental pollution. Second, I have been an advocate of victim compensation for five years. For the first time, there seems to be a chance that legislation in this field will be enacted.

The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA),¹ the Superfund legislation, makes no provision for the recovery of damages for personal injuries and property damage resulting from exposure to hazardous wastes, although there was frequent reference to such individual injuries in the course of its legislative history.

I would like to address four points: the genesis of the Environmental Law Institute Study, what the ELI Study says, the important differences between the ELI Study and the §301(e) Report, and some of the policy considerations behind our approach to the problem of compensation of victims of exposure to toxic substances.

Currently, only California has established a victim compensation fund. For the purpose of this paper, I would like to use the California fund¹ and the §301(e) Report² as a foil for considering the range of options available for structuring a fund and the trade offs and policy choices that are made in the alternatives. I will focus on eleven key issues that comprise any such compensation fund.

In Minnesota, a bill was recently passed that addresses recovery for exposure to hazardous substances in terms of statutory liability mechanisms rather than an administrative fund remedy.¹ There is, however, a suggestion of a fund remedy in the bill. I would like to give you a little bit of the background to the legislative debates that preceded passage of the bill. Late in 1980, after the federal Superfund was passed, Sen.

The Office of Management and Budget (OMB) has embarked on an effort to conduct a front-end analysis of the scope of the hazardous waste injury problem and the victim compensation problem. These issues, it is believed, soon will be in the midst of a good deal of action in Congress, and the Administration wanted to be in a good position to respond to that emerging concern. In response, we have gathered together the relevant agencies to form a task force and have decided to focus our efforts on two issues: how big is the problem, and what are some solutions.

The theme that I bring to you today is that the real problem with victim compensation and hazardous waste exposure is being driven by a public hysteria over the larger issue of hazardous substances in the environment. The atmosphere is driven by a great deal of distrust of the Environmental Protection Agency, federal and state governments, and the industries. People are wondering whom they should trust or believe.

The health risks from exposure to hazardous wastes, and to hazardous substances in general, are real. This is why the Environmental Defense Fund (EDF) has sued the Department of Health and Human Services (HHS) to force the Department to carry out the congressional mandate in the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund),¹ and why it has supported new proposals that seek to ensure that victims of toxic exposure will be compensated. I would first like to address the CERCLA §104(i) litigation.

The §301(e) Report recommends some fundamental changes to the basic law, despite its conclusion in the first chapter that roughly states, "Well, we do not know if there is a problem or not. We know that there are hazardous waste sites out there. We know that they may be dangerous.We know that people may be living near some of these sites.

I came to Washington near the time of the second anniversary of the president's inauguration. The first lawsuit I was presented was the suit brought by the Environmental Defense Fund (EDF), very soon thereafter joined by the Chemical Manufacturers Association (CMA) as a co-plaintiff, to compel the establishment of the Agency for Toxic Substances and Disease Registry (ATSDR) and the performance of certain functions. The American Petroleum Institute has just recently petitioned to intervene, but the judge has yet to pass on its petition.