Why Municipalities Should Not Receive Special Treatment Under Superfund

Andrew A. Giaccia and Roy S. Belden

Andrew Giaccia is a senior associate with the Washington, D.C., office of Chadbourne & Parke. Mr. Giaccia specializes in environmental issues and has represented numerous companies targeted as PRPs in Superfund site cleanups.

Roy Belden is an associate with the Washington, D.C., office of Chadbourne & Parke. Mr. Belden also specializes in environmental issues.

[22 ELR 10431]

Are municipalities justified in calling for special relief from the broad scheme of Superfund liability? This Dialogue asserts that such special treatment both overlooks the nature of municipal solid waste (MSW) and distorts the purposes of the Superfund program.¹

Municipalities argue that they are increasingly the targets of Superfund contribution suits by industrial polluters seeking to shift some of the liability for their "wrongdoing" onto the backs of innocent taxpayers. They claim that both the courts, which have refused to recognize sovereign immunity as a defense to Superfund liability for municipalities,² and the U.S. Environmental Protection Agency (EPA) have failed to correct this injustice. While EPA has acknowledged these concerns in its Interim Municipal Settlement Policy of December 1989,³ the municipalities believe the policy is inadequate since it only restricts EPA's discretion to sue local governments directly, without halting third-party lawsuits.⁴ The Policy does not purport to amend the Superfund national contingency plan⁵ or otherwise restrict the ability of third parties to sue municipalities for a share of cleanup costs at the same landfills. As a result, local government advocates are pressing for legislation in Congress that will amend Superfund to establish that municipalities cannot be held liable if all they did was to dispose of "ordinary garbage" at a Superfund site.⁶

At the heart of the effort to exempt municipalities from Superfund liability are two stubborn fallacies. The first is that "ordinary garbage" is benign, and the second is that all industrial wastes are harmful. These misconceptions support a world view in which individuals and their collective surrogates in local government are rarely the cause of environmental problems. The real culprit is industry, with its weapon of mass destruction, the 55-gallon drum. Accordingly, it is believed that Superfund liability should not be misdirected at simple household trash but should remain with the industrial polluters that have long profited from their abuses.

Scientific data dispel these myths. Consumer wastes include numerous sources of hazardous substances similar if not identical to those used by commercial establishments, such as pesticides, paints, thinners, detergents, clog removers, batteries, and adhesives, prompting one commentator to state that "[t]he home garbage pail is a leaking sieve of toxic and potentially toxic chemicals."⁷ Municipalities do not dispute that hazardous substances are present in MSW but argue that they constitute only a very low percentage of total waste volume.⁸ Such statistics are highly misleading. Even a low percentage of high volume MSW can result in a large total quantity of hazardous substances disposed at a landfill.⁹

On the other hand, industrial waste generators can incur Superfund liability if hazardous substances are present in their wastes, no matter how low the concentration levels.¹⁰ In one recent case, a company saddled with cleanup liability illustrated the unfairness of this standard by showing that the pages of the court's written opinion and order imposing liability, as well as EPA's amicus brief, contained higher concentrations of contaminants than the company's [22 ELR 10432] wastes.¹¹ There is also no de minimis quantity defense to Superfund liability.¹² As a result, an industrial waste generator that has contributed only a gallon of waste to a Superfund site may be forced to pay what inevitably amounts to a disproportionate share of the cleanup costs.

Few considerations of fairness or culpability enter into the Superfund liability scheme. Under principles of joint and several liability, the government is free to impose the entire cost of remediation on a handful of contributors, even though they may be responsible for only a small percentage of the total wastes disposed at a site and perhaps none of the harm being remedied. These defendants may be selected for their deep pockets because they can afford to take over the investigation and cleanup. It is then left to these primary defendants to find other parties who contributed hazardous substances to the site and to incur the expense of suing them for a share of the costs. To the extent that other contributors cannot be found or cannot pay, the primary defendants are stuck with the bill.

Under the circumstances, there is nothing illogical about asking municipalities to share in these costs. Nor can it be said that Congress intended a different result. In defining what "persons" are subject to Superfund liability, the statute expressly includes any "municipality" or other "political subdivision" of a state.¹³ In addition, the legislative history of Superfund indicates that Congress considered the possibility that household waste could result in Superfund liability for municipalities, but refused to do anything about it. In fact, Congress rejected an amendment offered by then Representative David Stockman that would have abrogated liability for MSW.¹⁴

While the current Superfund liability scheme may serve no purpose well, imposing generator liability on municipalities is arguably consistent with the sometimes identified Superfund goals of responsibility and deterrence.¹⁵ MSW contains hazardous substances in significant amounts and thus contributes to contamination at Superfund sites. There is nothing magical about the fact that such contamination comes from consumers instead of industrial sources. The impact on the environment is identical. It is the nature of these wastes, without regard for their source, that is enough to establish who is responsible under Superfund to pay the cost of cleanup.¹⁶ Similarly, the imposition of Superfund liability may have a deterrent effect on local governments that, unlike industry, have otherwise been given little incentive at the federal level to manage their MSW carefully.¹⁷

Local governments are right to argue that the current Superfund liability scheme unfairly threatens them with the prospect of paying cleanup costs highly disproportionate to the amount of harm caused by their wastes. In practice, courts have not always been willing to allocate Superfund liability based on the quantity and toxicity of each party's waste at a site.¹⁸ In response to this problem, EPA is currently preparing a new policy on allocating local government liability for MSW, and is considering a variety of theories for determining how much is fair for a municipality to pay.¹⁹ The different allocation theories being considered by EPA share a common theme: each tries to determine what portion of a landfill cleanup is driven by or attributable to MSW. Regardless of how EPA sets the allocation level for municipalities, the new guidance promises to add new layers of complexity in Superfund cases, as parties try to develop the facts necessary to meet the standard EPA eventually selects.

While efforts to reform Superfund practice are clearly needed, there is no logical justification for limiting them to the liability of municipalities. It cannot be unfair to impose "disproportionate" liability on municipalities, but fair if the wastes come from an industrial source. EPA and Congress should take a broader look at Superfund and inject assurances of fairness for all persons, not just because it is politically expedient, but because the system as it currently stands is too costly and inefficient to be allowed to continue.

1. 42 U.S.C. §§ 9601-9675, ELR STAT. CERCLA 001-075.

2. E.g., Artesian Water Co. v. Government of New Castle County, 605 F. Supp. 1348, 15 ELR 20577 (D. Del. 1985) (county could not assert defense of state tort immunity to claims under Superfund).

3. EPA, INTERIM MUNICIPAL SETTLEMENT POLICY, 54 Fed. Reg. 51071 (Dec. 12, 1989), ELR ADMIN. MATERIALS 35225.

4. Rena I. Steinzor & Matthew F. Lintner, Should Taxpayers Pay the Cost of Superfund?, 22 ELR 10089, 10090 (Feb. 1992).

5. 40 C.F.R. pt. 300 (1991).

6. Steinzor & Lintner, supra note 4, at 10090.

7. Steven Ferrey, The Toxic Time Bomb: Municipal Liability for the Cleanup of Hazardous Waste, 57 GEO. WASH. L. REV. 197, 203-07 (1988) (also describing other hazardous constituents of MSW, such as dichlorodiphenyltrichloroethane (DDT), polychlorinated biphenyls, arsenic, and lead and citing a study identifying approximately 1,500 different hazardous components in a sample of MSW.

8. Steinzor & Litner, supra note 4, at 10089.

9. Ferrey, supra note 7, at 220-21 (citing as an example the Charles George Landfill in Massachusetts where, even assuming that only 0.1 percent of the 4,000 cubic yards of MSW disposed there were hazardous,it would almost double the hazardous industrial waste present at the site); Molly A. Meegan, Note, Municipal Liability for Household Hazardous Waste: An Analysis of the Superfund Statute and Its Policy Implications, 79 GEO. L.J. 1783, 1784 (1991).

10. See, e.g., United States v. Alcan Aluminum Corp., 755 F. Supp. 531, 537-40, 21 ELR 20767, 20771 (N.D.N.Y. 1991) (citing the "overwhelming body" of case law in support of this principle).

11. New York City v. Exxon Corp., 766 F. Supp. 177, 22 ELR 20145 (S.D.N.Y. 1991) (petitioner's brief).

12. United States v. Tyson, 17 ELR 20527, 20532 (E.D. Pa. Aug. 21, 1986); United States v. Conservation Chem. Co., 619 F. Supp. 162, 233, 16 ELR 20193, 20224-25 (W.D. Mo. 1985).

13. CERCLA § 101(21), 42 U.S.C. § 9601(21), ELR STAT. CERCLA 008.

14. Representative Stockman criticized the unrestrained and unlimited powers the Superfund scheme would delegate to EPA and the number of items considered hazardous. 126 CONG. REC. H9438-41 (daily ed. Sept. 23, 1980). Stockman's proposed amendment was eventually rejected by the House of Representatives, and most responses to his criticism focused on the powers of EPA and the envisioned relationship between the state and federal governments. See generally B.F. Goodrich Co. v. Murtha, 22 ELR 20683, 20688 (2d. Cir. Mar. 12, 1992) (holding that municipalities may be subject to liability under CERCLA for cleanup costs).

15. See Meegan, supra note 9, at 1792-95; Michelle L. Washington, Note, A Proposed Scheme of Municipal Waste-Generator Liability, 100 YALE L.J. 805, 816 (1990).

16. As the Second Circuit recently emphasized, "a narrow interpretation of CERCLA that exempts municipalities arranging for the disposal of municipal solid waste from liability increases the probability that cleanup costs will never be recovered, and will be paid instead from the Superfund funded in part by the taxpayers at large." Murtha, 22 ELR at 20689.

17. See Sarah Robichaud, B.F. Goodrich v. Murtha and EPA's Municipal Settlement Policy: Municipalities Are Not Exempt From CERCLA Liability, 21 ELR 10456, 10463 (Aug. 1991); Mark J. Zimmerman, Household Garbage as a Hazardous Substance: What's a Mayor to Do?, 21 ELR 10453, 10455 (Aug. 1991). Indeed, some aspects of the federal regulatory scheme provide disincentives for careful MSW management. See, e.g., 40 C.F.R. § 261.4(b)(1) (1991) (EPA regulations under the Resource Conservation and Recovery Act provide a blanket exemption from hazardous waste requirements for MSW).

18. The so-called Gore factors for equitable allocation of Superfund liability, which include quantity and toxicity considerations, have been adopted by some courts. See, e.g., Amoco Oil Co. v. Borden, Inc., 889 F.2d 664, 672-73, 20 ELR 20281 (5th Cir. 1989); United States v. Stringfellow, 661 F. Supp. 1053, 1060, 17 ELR 21134 (C.D. Cal. 1987); United States v. A&F Materials Co., 578 F. Supp. 1249, 1256, 14 ELR 20105 (S.D. Ill. 1984). Other courts have concluded that defendants bear a difficult burden of showing their wastes are distinguishable and, absent meeting that burden, must pay on a per capita basis. United States v. Monsanto Co., 858 F.2d 160, 171-72, 19 ELR 20085 (4th Cir. 1988); O'Neil v. Picillo, 682 F. Supp. 706, 725, 18 ELR 20893 (D.R.I. 1988).

19. EPA has recently prepared a draft guidance relying on a unit-cost formula. See INSIDE EPA'S SUPERFUND REP., Mar. 25, 1992, at 3. While the document is under White House review, EPA continues to consider all options for allocation. See INSIDE EPA'S SUPERFUND REP., Apr. 22, 1992, at 3.