PREPARED STATEMENT OF TOM UDALL
ATTORNEY GENERAL OF NEW MEXICO
HEARING ON THE PROPOSED SUPERFUND CLEANUP ACCELERATION ACT OF 1997 (S. 8)
BEFORE THE SUBCOMMITTEE ON SUPERFUND, WASTE CONTROL, AND RISK ASSESSMENT
OF THE SENATE COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
Presented by Charles de Saillan
Assistant Attorney General
March 5, 1997

INTRODUCTION

Mr. Chairman, members of the Subcommittee: I am Tom Udall, Attorney General of New Mexico. I am Immediate Past President of the National Association of Attorneys General ("NAAG"). I am also a member of the NAAG Environment and Energy Committee and Legislative Subcommittee. I appreciate the opportunity to appear before you today on behalf the State of New Mexico and provide our views on Senate Bill 8, the proposed Superfund Cleanup Acceleration Act of 1997 ("SCAA" or "S. 8"), which would amend and reauthorize the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), commonly known as Superfund. This proposed legislation is of extreme importance to the State of New Mexico, and to many of the state attorneys general.

The Superfund program has recently been criticized as a failed program. I disagree with that characterization. The Superfund program has accomplished a great deal, in New Mexico and nationwide. Fifteen years ago, the problem of uncontrolled hazardous waste sites was frighteningly pervasive. Today, the immediate threats have been eliminated at virtually all of the 1300 or so sites on the National Priorities List ("NPL"), and at most of these sites cleanup is well underway.

A. The Interests of the Attorneys General

The state attorneys general have a major interest in Superfund reauthorization legislation. As chief legal officers of our respective states, we have a duty to ensure that the laws of our states are complied with. We are necessarily concerned that the health and welfare of our citizens are protected, and that our environment and natural resources are preserved and restored.

Moreover, many steps in the CERCLA cleanup process necessarily involve legal issues. Throughout the process, we are called upon to advise our client agencies -- both response agencies and natural resource trustee agencies -- on how the law should be interpreted, and how the law can be implemented to achieve the desired cleanup or restoration goals. We are also responsible for negotiating settlements. Most of the progress we have made under CERCLA has been through negotiated settlements, either consent decrees filed in federal district court or administrative orders on consent. When a settlement can not be reached, it then becomes our responsibility to commence and litigate an enforcement action. We have considerable experience in CERCLA litigation. Finally, we must sometimes defend a state agency when it is a responsible party under CERCLA.

For these reasons, the state attorneys general have been actively involved in the CERCLA reauthorization process since it began in the 103rd Congress. Last year my colleague, Christine Gregoire, Attorney General of the State of Washington, testified before the full Committee on S. 1285, an earlier version of Superfund reauthorization legislation. Joe Mazurek, Attorney General of Montana, also submitted written comments on the natural resource damage provisions of that bill. In addition, the leadership of NAAG's Environment and Energy Committee submitted detailed comments on the legislation. I fully support the positions that my colleagues have stated in correspondence with and hearings before this Committee.

This year, we are pleased to note that many of our concerns have been addressed and several of our suggestions have been adopted in S. 8. We greatly appreciate the Subcommittee's consideration of our comments. We strongly support certain aspects of S. 8, and we believe it is a significant improvement over S. 1285. Nevertheless, we continue to have many serious concerns with S. 8.

B. Overall Concerns

Before moving on to detailed comments on S. 8, we want to raise two overall concerns with the bill from New Mexico's perspective.

Our first overall concern is the bill's length and complexity. S. 8 is 259 pages long. It would completely rewrite CERCLA. The cleanup standards, the remedy selection process, the liability scheme, and the natural resource damage provisions, are all changed radically and in innumerable ways. Yet every change in the law will need to be interpreted, first by the implementing agency, and second, in many instances, by the courts. The result, we fear, will be the shifting of limited agency resources from cleanup to writing regulations and guidance; the nullification of fifteen years of hard-fought judicial precedent; more litigation and transactions costs; and further delays in cleanup. We strongly urge the Subcommittee to focus on those provisions of CERCLA that truly need revision, and to draft narrow, concise, straightforward legislation to put those revisions into place.

Our second overall concern is the bill's general weakening of the standards for protection of groundwater. We cannot emphasize enough the importance of groundwater resources, especially for arid states like New Mexico. Let me illustrate my point with an example. The City of Albuquerque, New Mexico lies in the Middle Rio Grande Valley atop a large alluvial aquifer. The aquifer, which is the sole source of drinking water for the City, was once thought to be an inexhaustible resource. We now know that we are effectively mining the aquifer; the water table is receding at a rate of approximately one foot per year. At the current rate of consumption, the City will soon run out of water -- literally.

Not only do we have a supply problem, we also have a contamination problem which exacerbates the supply problem. We have several Superfund sites in the Albuquerque valley, and scores of other, smaller sources of groundwater contamination. Occasionally, the responsible parties maintain that they should not be required to clean up the contamination problems that they created, that natural attenuation or dispersion will eventually solve the problem. We find such a position unacceptable. Only two weeks ago, the State of New Mexico, together with the City of Albuquerque and Bernalillo County, took the unfortunate but necessary step of filing a lawsuit against one such responsible party. As we state in our complaint, the defendant is responsible for a huge plume of trichloroethylene ("TCE") contamination, extending at least one-half mile from the facility, and containing TCE concentrations at more than 300 times the drinking water standard. Obviously, we can not simply "write-off" this aquifer.

We are very concerned that the provisions of S. 8 would weaken our commitment to protection of our groundwater resources. Similar provisions will find their way into other state and federal environmental laws. Responsible parties will be emboldened to litigate, relying on the weaker standards. It will become increasingly difficult for us to protect our precious groundwater resources such as the Albuquerque aquifer.

Our comments on the specific provisions of S. 8 follow. Although we have attempted to be fairly comprehensive, we do not address every issue we have identified in the bill. We anticipate providing you and your staff with more extensive and detailed comments, including proposed revisions to the bill, in the coming weeks.

I. BROWNFIELDS REVITALIZATION (TITLE I)

We support the concept of encouraging the use and development of abandoned industrial sites, or so-called "brownfields."

II. STATE ROLE (TITLE II)

We strongly favor the delegation of Superfund authorities to qualified states, as we have stated previously. S. 8 would provide for such delegation, and we are generally pleased with the bill's relatively streamlined delegation process. We strongly support that aspect of the bill. However we have several comments on the details of the state role title.

A. Delegation Process

Section 201(a) of SCAA would provide for EPA to delegate CERCLA authorities to qualified states. The delegation provisions would afford states considerable flexibility to receive comprehensive delegation, delegation for particular sites, or delegation for certain phases of cleanup.

We support the bill's flexibility. We nevertheless have some comments on these provisions. First, although the bill includes a variety of delegation options, it does not expressly allow delegation of a portion of a Superfund site, such as an operable unit. Such an approach would allow federal and state agencies to make the most efficient use of their collective resources.

Second, and most importantly, the bill does not provide for authorization of a state program as an alternative to delegation. Other federal environmental statutes, such as RCRA, allow EPA to authorize qualified states to implement their own program in lieu of the federal program. Authorization would allow states with successful, effective cleanup programs to implement those programs at all sites, including NPL sites, within their borders. Last year, we proposed statutory language providing for state authorization for the Committee's consideration. We continue to recommend such a provision.

B. Preemption of State Law

Section 201(a) of SCAA would require a state that has received partial delegation to perform its delegated authority "in the same manner" as would EPA. It would allow a state that has received comprehensive delegation to select a remedial action that is more costly than that required under the revised remedy selection provisions, provided that the state pays the incremental costs of the remedy. Moreover, such a state would be precluded from recovering those costs under CERCLA or any other state or federal law.

We object to these provisions, which we view as inappropriately preempting state law. These provisions are particularly troublesome for those states that are most likely to qualify for delegation because of their demonstrated success in implementing their own cleanup programs. These state cleanup programs have succeeded based upon remedy selection and liability provisions chosen by the states to meet the needs and desires of their citizens for adequate protection of health, safety and the environment -- areas in which states have traditionally exercised significant authority. These programs are fully capable, as currently implemented, to take over cleanup of NPL sites. Requiring states with highly successful cleanup programs to change their liability and cleanup standards to fit the federal mold is both unnecessary and wasteful.

III. COMMUNITY PARTICIPATION (TITLE III)

Although NAAG has not taken a position on this issue, we in New Mexico generally support efforts to increase public participation in the Superfund process. We support statutory provisions for the establishment of community response organizations. We also support expanding the program for technical assistance grants. We are concerned, however, that the community participation provisions are much too complex. Because community groups have very limited financial and legal resources, the provisions of this title should be especially simple and straightforward. We urge the Subcommittee to greatly simplify the community participation provisions.

IV. SELECTION OF REMEDIAL ACTIONS (TITLE IV)

Although NAAG has not taken an official position on remedy selection issues, we in New Mexico are very concerned that the proposed remedy selection provisions of S. 8 would result in cleanups that are less than adequate to protect public health and the environment. We are particularly concerned over how these provisions would apply to groundwater cleanups. We strongly urge the Subcommittee to reconsider these proposals.

A. Remedy Selection Standards

Perhaps no other part of the bill represents such a complete rewrite of CERCLA as does Title IV. Sections 121(a), 121(b), and 121(d) of current law would be stricken in their entirety. They would be replaced by a very complex, confusing, and lengthy new subsection. The result would be a great deal of uncertainty and disagreement, and new rounds of transaction costs incurred in interpreting the new provisions.

1. General Cleanup Standards. The bill requires remedial actions to be selected based on a multiplicity of different and potentially conflicting criteria. Under section 402 of SCAA, a remedy must meet the goals of protecting human health and the environment as set forth in one provision of the bill; comply with applicable federal and state laws as set forth in another provision of the bill; be based on a facility-specific risk evaluation as set forth in another provision of the bill; be based on the remedy selection criteria set forth in another provision of the bill; and meet the requirements on technical impracticability set forth in yet another provision of the bill. Additionally, the remedy must be based on actual or planned or reasonably anticipated future land use as set forth in still another provision of the bill.

These provisions are very poorly integrated and terribly convoluted. Meeting all these assorted requirements would place an enormous burden on the decisionmaker. Even more troubling, there is no way to resolve the inevitable conflicts among the various requirements. For example, applicable state cleanup standards might require cleanup of contaminated soil to one level, while a facility-specific risk assessment might mandate a very different level. Similarly, applicable state standards might require cleanup of groundwater to a certain level regardless of its actual or anticipated use. Which of the bill's requirements would control in these and countless other situations? Emphatically, the result of these provisions would not be to streamline the cleanup process, contrary to one of the primary goals of reauthorization which we all share.

2. Consideration of Costs. Section 402 of the bill would require selection of "a cost-effective remedial action." We agree that remedial actions should be cost-effective, as is required under current law. The bill's requirement is a significant improvement over S. 1285, which required selection of "the most cost effective remedial action," language that we opposed. We appreciate the Subcommittee making this revision.

However, the bill would eliminate from current law the requirement for consideration of the potential for future remedial action costs if the remedial action fails. Moreover, the bill does not clearly require consideration of life cycle costs, including long-term operation and maintenance. We are concerned that the bill would place too much emphasis on short-term costs, without providing for adequate consideration of long-term costs. This concern is magnified by the bill's increased reliance on "institutional and engineering controls" -- meaning containment remedies (discussed below) which have greater long-term costs.

3. Consideration of Future Land Use. Sections 402 and 403 of the bill provide for consideration of the "actual or planned or reasonably anticipated future use of land or water resources" in remedy decisions. We are puzzled, however, as to how this consideration would be applied under the bill. It is not clear whether the provision is intended to be a controlling factor in selecting remedial actions, or simply another factor that the decisionmaker must consider and balance against other competing factors.

We believe that future land use should be a factor in selecting remedial actions, but not a controlling one. The statute should not require that all cleanup decisions be strictly based on the most probable future land use. EPA, or a delegated state agency, should be allowed the flexibility to consider less likely but plausible future land uses. The Love Canal property, it should be remembered, was used for the disposal of some 22,000 tons of chemical waste in the 1940's and 1950's, yet it eventually became a residential neighborhood and public school. EPA or a state agency should also be allowed to compare the relative costs of more complete cleanup free of any institutional controls versus the costs of a less complete cleanup necessitating long-term institutional controls. Otherwise, an inflexible requirement might prohibit EPA or a state agency from conducting a more stringent cleanup even when the added cost of doing so was limited, the cost of maintaining long-term oversight was substantial, and the risk that institutional controls might fail was significant.

4. Containment Versus Treatment. Section 402 of SCAA would completely eliminate the preference for remedial actions that treat hazardous substances to "permanently and significantly reduce the volume, toxicity or mobility of" such substances, as required under current law. The bill omits any provisions for treatment even for "hotspots," a provision included in the 1994 bill. The bill further discourages treatment remedies by expressly requiring remedial actions based on "institutional controls" and "engineering controls" -- meaning containment remedies -- to be considered on an equal basis with treatment remedies.

Congress added the preference for treatment remedies in the 1986 SARA amendments. Congress then recognized that containment remedies, such as caps, liners, and slurry walls designed to contain hazardous substances in place, often do not work. As Senator Chafee noted at the time, "a major goal" of these 1986 provisions was to "establish a statutory bias toward the implementation of permanent treatment technologies and permanent solutions whenever they are feasible and achievable."

We believe it would be inappropriate to place remedies that merely contain hazardous substances, or that limit access to hazardous substances with a fence or a deed restriction, on equal footing with remedies that actually clean up hazardous substances. Clearly, total and permanent elimination or immobilization of hazardous substances is of far greater benefit to the local community and to society at large. The environment is restored, future health threats are eliminated, and property is opened up for development or other useful purposes. These benefits must be taken into consideration.

Furthermore, containment remedies require greater expenditures for long-term monitoring and operation and maintenance than do treatment remedies. Containment remedies are much more prone to failure than treatment remedies, as Congress recognized even in 1986. We fear that years after this bill is passed, when the Superfund program has been phased out of existence and the responsible parties have left town or gone out of business, the states will be left to bear the brunt of the costs of monitoring, of operation and maintenance, and of repairing many failed containment remedies.

5. Protection of Human Health. The bill would substantially rewrite current law on protection of human health. Section 402 of the bill provides that a remedial action must protect human health by reducing the risk from nonthreshold carcinogenic hazardous substances to a one in 10,000 to one in 1,000,000 (10-4 to 10-6) lifetime cancer risk, and reducing the risk from threshold carcinogenic and noncarcinogenic hazardous substances to a hazard index not exceeding one. This provision would seriously weaken the standards for protection of human health as compared to current law set forth in the 1990 National Contingency Plan ("NCP").

The NCP provides that risk from known or suspected carcinogens should be reduced to a one in 10,000 to one in 1,000,000 lifetime cancer risk, and that the one in 1,000,000 risk level "shall be used as the point of departure." The NCP also provides that risk from noncarcinogens should be reduced so that "the human population, including sensitive subgroups, may be exposed without adverse effect . . ., incorporating an adequate margin of safety." Moreover, these standards apply in addition to applicable or relevant and appropriate requirements ("ARAR's") which are often more protective.

The result of this amendment, we fear, will be that the one in 10,000 risk level for carcinogens will normally be applied; the effects of suspected carcinogens will not be considered; a less protective standard for noncarcinogens will be applied; the effects of noncarcinogens on sensitive subgroups, such as children and pregnant women, will not be considered; and no margin of safety for noncarcinogens will be incorporated. Consequently, remedial actions will be selected that are much less protective of human health.

6. Protection of the Environment. The bill states in much simpler terms the goal of protection of the environment than did S. 1285. It provides that a remedial action must protect the environment by protecting ecosystems from significant threats to their sustainability resulting from releases of hazardous substances. We appreciate that the Subcommittee has deleted from S. 8 the various confusing and circular definitions of "ecosystem" contained in S. 1285, as we had suggested.

7. Protection of Groundwater. The bill's goal for protection of groundwater actually does little to protect groundwater per se. It provides that a remedial action must protect groundwater by preventing or eliminating "actual human ingestion" of water contaminated with hazardous substances in excess of maximum contaminant levels set under the Safe Drinking Water Act. This goal addresses protection of human health, not protection of groundwater; groundwater could remain severely contaminated so long as no one drinks it.

8. Compliance with Applicable Laws. Section 402(1) of SCAA would require remedial actions to comply with the substantive requirements of all applicable state and federal environmental and facility siting laws. The bill would also eliminate from current law the requirement that remedial actions comply with all "relevant and appropriate requirements." Further, the bill would eliminate from current law the requirement that remedial actions attain cleanup of groundwater to maximum contaminant level goals ("MCLG's") set under the Safe Drinking Water Act and water quality criteria set under the Clean Water Act.

We are very pleased that the bill retains applicable state and federal requirements, which we view as a major improvement over S. 1285 as it was originally introduced. We generally do not object to the elimination of "relevant and appropriate requirements," which would serve to streamline the remedy selection process. We are very troubled, however, by the elimination of the requirement in current law that cleanup must attain MCLG's and water quality criteria. MCLG's, and the less stringent maximum contaminant levels ("MCL's") also set under the Safe Drinking Water Act, are drinking water standards, not cleanup standards. Water quality criteria similarly are not cleanup standards. Thus, although these standards and criteria are relevant and appropriate, they are not clearly applicable. Under the bill, MCL's and MCLG's would not govern groundwater remediation, and water quality criteria would not govern surface water remediation, unless they were adopted as cleanup standards under state law. We believe this is a serious flaw in the bill.

In addition, as explained above, it is not clear how the requirement for compliance with applicable standards meshes with the requirement for a facility-specific risk assessment, or the requirement to consider future land use. If, for example, cleanup levels determined by a risk assessment would preempt any conflicting applicable cleanup standards, we would strongly object.

9. State Acceptance. Section 402 of the bill lists several factors to be considered in remedy selection. Although the listed factors include acceptance of the remedial action by the affected community, they do not include acceptance by the state. Under current law, acceptance by both the community and the state are factors to be considered in remedy selection. We see no reason for this omission; we believe state acceptance should be retained as a factor.

10. Technical Impracticability. The bill would add several new provisions governing the determination that a remedial action is technically impracticable to implement. Many of these provisions apply particularly to remediation of contaminated groundwater. Most significantly, for groundwater remedies the bill would require that technical impracticability be determined, prior to implementation of the remedy, based on projections or modelling.

We are concerned that this provision will foreclose taking any action to reduce groundwater contamination if a modelling study shows that it is technically impracticable to attain applicable cleanup standards. Under current law, EPA generally makes a finding of technical impracticability of a groundwater remedy only after a "pump and treat" remedy has been largely implemented and contaminants have been reduced to asymptotic levels -- that is, until continued pumping no longer appreciably reduces contaminant concentrations. Such levels are usually much lower than the original concentrations. Under the bill's provisions, EPA or a delegated state would make an initial finding of technical impracticability and no further cleanup would be required. Moreover, the provision seems inconsistent with other provisions of the bill, that require EPA to select a technically practicable remedy that most closely achieves cleanup standards.

11. Groundwater. As with the general standards for remedy selection, section 402 of the bill provides a multitude of poorly integrated and potentially conflicting standards for groundwater remedies. In many cases, it would be virtually impossible to comply with all of the bill's cleanup requirements. Furthermore, although the bill's groundwater provisions represent an improvement over S. 1285, we are nevertheless very concerned that the bill would fail to adequately protect groundwater. Several of its provisions are particularly troubling. First, as mentioned above, the bill would eliminate the requirement that groundwater remedies must attain MCLG's, or even MCL's. Second, the bill places unnecessary emphasis on natural attenuation, dilution, dispersion, and biodegradation. Third, as also mentioned, the bill allows a finding of technical impracticability for remediation of groundwater contamination to be based merely on modelling, and, once such a determination is made, no measures to reduce the contamination are necessary. Finally, the bill suggests that where restoration of contaminated groundwater is technically impracticable, point-of-use treatment devises -- meaning filters under the sink -- are all that is needed.

12. Five-Year Review. Section 402(2) of SCAA would retain the five-year review requirement in section 121(c) of CERCLA. Under this provision, after implementation of a remedial action which leaves hazardous substances in place, EPA must review the remedy every five years to ensure that human health and the environment are protected. S. 1285 would have extended this the review period to every seven years, and we are pleased that the five-year review period would be retained under S. 8.

B. Remedy Selection Procedures

1. Remedial Action Plan. Section 404 of SCAA would completely rewrite the remedy selection procedures in the current NCP. The bill would replace the record of decision process with a "remedial action plan" to be prepared by EPA or presumably an authorized state, or by the potentially responsible parties. It would also seriously limit agency oversight of response actions conducted by responsible parties.

We are quite troubled by these revisions. We do not believe they are necessary. EPA promulgated the current NCP based on considerable public comment and careful consideration. It was largely upheld by the court of appeals. We believe its procedures are working reasonably well. We are concerned that the bill's revisions would result in unnecessary delay and transaction costs. EPA, state agencies, and remediation contractors would need to learn and interpret the lengthy new rules. EPA would be required to conduct a long and tedious process of wholesale revisions of the NCP. The NCP revisions, unquestionably, would be challenged and litigated.

Moreover, although we recognize that the provisions have been improved somewhat, consistent with our comments on S. 1285, we are still very troubled by the substance of the bill's procedures. It provides that the responsible parties would prepare the remedial action plan by which the remedy is selected. Furthermore, it would significantly limit EPA or state oversight over development and implementation of the remedial action. The bill would limit agency review and approval to the work plan, the "facility evaluation," the proposed and final remedial action plan, and the remedial design. For the most important of these items, the remedial action plan, agency oversight would still be quite limited; the bill provides that the remedial action plan must be approved unless it fails to contain certain minimal information, or does not meet the requirements of revised section 121(a). Moreover, if the agency fails to disapprove a proposed remedial action plan within 180 days after it is submitted, it is automatically considered approved.

We continue to object to these provisions. EPA and analogous state agencies have a statutory responsibility to protect the health and environment of their citizens. The responsible parties have no such responsibility; indeed, in many instances the responsible parties' financial interests are inconsistent with protection of health and the environment. Moreover, the responsible parties often are not technically qualified to select the remedial action or to implement it without careful oversight. Further, continuous agency oversight and review enables the responsible parties to work cooperatively with the agency to ensure that the final work plans will be acceptable, thus avoiding costs and delays as unqualified responsible parties are forced to go back to the drawing board.

It is therefore critical in our view that the responsibility to select the remedial action remain with EPA or the authorized state agency, and that responsible party response actions be subject to thorough agency oversight. Moreover, while we do not favor unnecessary delay in selecting remedial actions, we believe it is bad public policy to require that a defective remedial action plan is automatically approved, and may be unilaterally implemented by the responsible party, if the agency does not disapprove it within 180 days.

2. Preenforcement Review. We are very pleased that the bill would retain the bar in current law on preenforcement review. This provision in CERCLA limits litigation and allows remedial actions to proceed expeditiously. We view the retention of this provision as a major improvement over S. 1285, and we appreciate the Subcommittee's consideration of our comments on the issue.

C. Transition

Section 406 of the bill would require EPA to reopen final remedy decisions made prior to the bill's enactment, and to re-examine such decisions applying the bill's new remedy selection standards. The bill would require EPA to reopen decisions for sites for which the Record of Decision ("ROD") has been signed; sites for which the remedial design has been completed; and, under certain circumstances, even sites for which the construction has been completed and operation and maintenance is underway.

We are very troubled by this requirement. It would divert EPA resources to reviewing remedial decisions at a great many sites for which a ROD has been signed but the remedy is not yet complete. The requirement would also delay cleanup at many of these sites. In New Mexico, for example, which has thirteen NPL sites, cleanup for at least three of those sites would likely be delayed by this requirement.

It is significant to note that the 1986 SARA amendments, which then established new and more stringent cleanup standards, applied those new standards only to ROD's signed after the date those amendments were enacted. Section 121(b) of SARA expressly provided that the new cleanup standards of section 121, added by SARA, did not apply to any ROD signed before the date of enactment. It further provided that such standards applied only "to the maximum extent practicable" to ROD's signed during the thirty-day period immediately following enactment.

We strongly oppose section 406, and recommend that it be deleted in favor of a provision similar to that in section 121(b) of SARA.

V. LIABILITY (TITLE V)

A."Retroactive" Liability

We strongly support retention of so-called "retroactive" liability, as we have repeatedly stated. The term "retroactive" liability, we should point out, is in our view a misnomer. CERCLA imposes liability on responsible parties for past disposal activities resulting in current, ongoing, uncontrolled releases of hazardous substances. We commend the Subcommittee for largely retaining in the bill liability based on pre-enactment disposal activities.

B. Exemptions From Liability for Certain Parties

SCAA contains an assortment of new exemptions from CERCLA liability. We generally support limitations on liability for small contributors, such as de minimis and de micromis parties, and generators of municipal solid waste. We believe, however, that many of the exemptions in SCAA are overly broad and poorly defined. We are also concerned that these exemptions may place a serious burden on the Fund.

Furthermore, it is important to emphasize that EPA is dealing effectively with the issue of fairness to small parties. It is proceeding aggressively with de minimis settlements, having now settled the liability of over 14,000 such parties. It has also implemented a policy for quickly addressing the liability of truly de micromis parties. Through de minimis and de micromis settlements, these parties attain a degree of finality that is not possible under a statutory exemption. We support EPA's efforts to address the liability of these parties, and anticipate that delegated states will follow EPA's lead. We therefore believe many of the proposed statutory exemptions may be unnecessary.

1. Municipal Solid Waste. Section 501(b) would exempt from liability generators and transporters of municipal solid waste. Because municipal solid waste is inherently less hazardous than industrial waste, we agree with the concept of limiting liability for the disposal of municipal solid waste. We have no comments on this exemption at this time.

2. De Minimis Parties. Section 501(b) of SCAA would also exempt from liability certain "de minimis" parties that contributed less than specified quantities of waste to a site. This exemption would apply to parties that contributed less than one percent of the total volume sent to a site, or less than 200 pounds or 110 gallons of waste materials sent to a site.

We have generally supported revisions that would make it easier for EPA or a delegated state to enter into de minimis settlements. We have also supported an exemption for truly de micromis parties that sent minuscule quantities of waste to a site. We believe, however that the determination of de minimis, or de micromis levels should be left to the discretion of EPA or the delegated state on a site-by-site basis. We are therefore troubled by the provisions exempting from liability parties that sent no more than certain specified volumes of waste; in many cases these volumes would be most inappropriate.

First, at many sites one percent of the total volume of waste represents a tremendous quantity of hazardous waste. For example, 21 million gallons of waste were disposed of at the Hardage site in Criner, Oklahoma. Under this bill the de minimis level for Hardage would be 210,000 gallons of liquid hazardous waste! We do not believe such a large quantity of waste should qualify for an exemption. Moreover, at many sites, no parties sent more than one percent of the total. The exemption would thus swallow the liability rule. The one percent level also fails to account for toxicity, mobility, and other hazardous characteristics that are, in some cases, very significant.

Second, at many sites 200 pounds or 110 gallons represents a very substantial proportion of the total. For example, under this exemption a party improperly disposing of 110 gallons of trichloroethylene (TCE), a common industrial solvent, would be exempt from liability. Yet 110 gallons of TCE can contaminate 16 billion gallons of pure drinking water at a concentration of 10 micrograms per liter, which is twice the health-based MCL of 5 micrograms per liter set under the Safe Drinking Water Act. Again, we believe exempting such a party would be inappropriate.

Moreover, the "de minimis" levels of liquid and solid wastes established in the proposal are incongruous. Assuming a density of water (most hazardous liquids will have a density fairly close to that of water), 110 gallons of liquid weighs 880 pounds. Thus, a much higher quantity of liquid hazardous waste (880 pounds) than solid hazardous waste (200 pounds) would qualify for the exemption. Yet liquid hazardous waste is likely to be much more mobile in the environment, much more bioavailable, and much more difficult and expensive to remediate.

3. Small Businesses. Section 501(b) would also exempt "small" businesses with 30 or fewer employees or earning less than $3 million annual gross revenues per year. The exemption would apply only to liability for response costs incurred after the date of enactment of SCAA.

We foresee several difficulties in attempting to determine whether a business qualifies for this exemption. For example, the number of employees may fluctuate. It is not clear whether part-time employees, seasonal employees, contract employees, and even managers should be included. Moreover, an accountant can usually provide several different figures for gross revenues, using different but accepted accounting methods. Thus, we fear that interpretation and implementation of this exemption would be quite troublesome.

Further, under long-standing EPA and state policy, a responsible party's ability to pay is taken into consideration in entering cleanup and cost recovery settlements. We believe this is sound policy. While we are certainly sympathetic to the plight of small businesses potentially liable under CERCLA, we believe this problem is better addressed through consideration of ability to pay, use of de minimis settlements, and providing for a (more limited) de micromis exemption.

4."Codisposal" Landfills. Section 504(b) would create a broad exemption for parties that sent wastes to so-called "codisposal landfills -- defined as landfills at which municipal solid waste is a "substantial portion" of the total volume of waste disposed. Section 504(b) would also cap the liability of the owners and operators of codisposal sites at various levels, depending on whether the landfill is owned and operated by a small municipality, a large municipality, or a private party.

We have several serious concerns with this exemption. First, it is not clear what is meant by a "substantial portion" of the total volume of waste. Arguably, a substantial portion could be as little as one percent, or as much as fifty-one percent. Second, we question whether such an exemption is necessary, given the exemption for disposal of municipal solid waste. Third, we believe this exemption is far too broad. A great many industrial waste and hazardous waste landfills accepted substantial quantities of municipal solid waste. The parties responsible for the disposal of industrial and hazardous wastes at these landfills should not receive a blanket exemption from CERCLA liability simply because some municipal solid waste was also disposed of at the landfill. Such an exemption would inappropriately shift the cost of cleaning up these landfills from the responsible parties to the taxpaying public.

5. Recyclers. Section 510 of SCAA would create a broad and complex new exemption for "recycling" activities. It would limit generator and transporter liability for transactions involving the recycling of scrap glass, paper, plastic, rubber, textile, metal, and spent batteries, including spent lead-acid batteries. Scrap metal would include metal byproducts, including slag, skimming, or dross, and probably also including mine tailings.

While we agree that recycling activities should be encouraged, we are nevertheless troubled by this exemption. We believe the exemption is particularly inappropriate as it applies to spent lead-acid batteries. Such batteries contain large quantities of lead, an especially toxic substance, as well as smaller quantities of cadmium and other heavy metals. Much of the lead in these batteries is in the form of lead oxide and lead sulfate, compounds that are relatively mobile and bioavailable in the environment. Moreover, the sulfuric acid in these batteries (which has a pH approaching 0) greatly enhances the solubility and mobility of these metals. Furthermore, the battery reclaiming industry has a woefully poor record for compliance with environmental laws. The industry has also created a large number of Superfund sites.

The bill would place certain limitations on the exemption for spent batteries. For several reasons, however, the limitations may not work as intended. First, the bill provides that the exemption for spent lead-acid batteries would only apply if the person was in compliance with a standard established by EPA under RCRA governing the management of such batteries. EPA has promulgated regulations under RCRA governing the management of spent lead-acid batteries. In states with RCRA authorization, however, the state regulations, not the federal regulations, would be applicable. Hence, in most states, there would be no applicable standard set by EPA. Second, the secondary lead smelter industry has repeatedly argued that the RCRA regulations -- under either federal or state authority -- do not apply to spent batteries. These batteries, the industry argues, are raw material; they are not discarded, and thus not solid wastes and not subject to regulation under RCRA. Finally, the lead components of spent lead-acid batteries would also fall within the definition of "scrap metal." The limitations on the exemption for scrap metal is significantly less stringent than the limitations on the exemption for spent batteries. As the exemptions are currently drafted, a person recycling the lead from spent lead-acid batteries could take advantage of the less stringent limitation for scrap metal.

We are also very concerned by the scrap metal exemption as it applies to "byproducts" such as slag. Slag from smelters, which may contain high levels of lead and other heavy metals, has often been "recycled" as fill material creating serious environmental problems. Moreover, the exemption could be interpreted to cover mine tailings, which have similarly been "recycled" as fill material.

We urge the Subcommittee to narrow the recycling exemption, particularly as it applies to spent lead-acid batteries, and to eliminate the exemption for metal byproducts. To address spent batteries, we would much prefer a more limited exemption for retailers of batteries that accept spent batteries from consumers for recycling and that are in compliance with applicable federal and state regulations. The exemption should be modelled on the service station dealer exemption in section 114(c) of CERCLA. At the very minimum, the exemption should be revised to address the issues we have raised.

C. Allocation

Section 503 of SCAA provides a lengthy procedure for the allocation of liability among responsible parties. The procedure would be required at all sites involving two or more parties. The bill requires EPA to promulgate regulations establishing the allocation procedures in greater detail.

NAAG does not have an official position on the issue of allocation, as there is a wide range of views on the issue among the attorneys general. Nevertheless, last year we expressed serious reservations about the allocation provisions in S. 1285, and in 1994 we expressed similar reservations about the allocation provisions in S. 1834. We have quite similar reservations about the allocation provisions in S.8.

First, we continue to be concerned that the allocation procedure will be very time-consuming, and will inevitably result in delays in cleanup. On this issue, we are very pleased to see that S. 8 would reserve the agency authority to bring an enforcement action seeking cleanup while the allocation procedure is pending. This reservation is a major improvement over S. 1285, which would have expressly barred any such enforcement action. We believe the bill should go further, however, and expressly require EPA to proceed with notice, negotiations, and enforcement independent of any allocation proceedings.

Second, although we are pleased to note that the bill's allocation procedures are significantly more flexible than those in S. 1285, we continue to believe the procedures are far too rigid. Under the bill, allocation would be mandatory for most sites, even if there are only two responsible parties. We believe the bill should allow EPA, and delegated states, maximum flexibility to determine whether or not to conduct an allocation, and how it should be conducted.

Third, we are concerned that implementation of the allocation procedure would place a significant burden on EPA and delegated state agencies. Implementation is likely to entail considerable agency resources, at the expense of the more important goal of getting sites cleaned up.

Fourth, the bill would require the allocation to be based on consideration of seven factors, commonly referred to as the "Gore factors," listed in the bill. These factors include the volume, toxicity, and mobility of the waste, and the culpability and cooperation of the responsible party. As the bill is written, the allocator would apparently be required to consider each of these factors, although doing so might add considerable delay to the allocation process. For example, at many sites the time and effort necessary for a thorough consideration of waste toxicity and mobility, rather than simply basing the allocation strictly on volume, may far outweigh the benefits obtained by a marginally more precise allocation. The allocator should have the flexibility to make a determination to give little or no consideration to certain factors such as toxicity and mobility, and thus potentially save substantial time and resources.

Finally, we question whether the allocation provision is really necessary. As previously discussed, EPA is aggressively addressing the liability of de minimis and de micromis parties, and we anticipate that the reauthorized statute will further limit the liability of such parties. These efforts will resolve or eliminate the liability of a great many small-stake parties that tend to bear a disproportionate share of transaction costs, particularly at large multi-party sites. Thus, the benefits of the bill's allocation provision will be of considerably less consequence.

VI. FEDERAL FACILITIES (TITLE VI)

The states have a particular interest in the cleanup of federal facilities. As Congress recognized when it enacted SARA in 1986, federal facilities are "among the worst hazardous waste sites in the nation." Yet the federal government is relatively insulated from enforcement actions to compel cleanup. Where federal government agencies are the liable parties, EPA enforcement authority is at its weakest. Under the "unitary Executive" theory, long advocated by the U.S. Department of Justice, EPA cannot bring a judicial enforcement action against a sister federal agency. Given EPA's limited enforcement authority, state enforcement authority is of critical importance.

A. Delegation Procedures

Section 601 of SCAA would provide for the transfer of Superfund authority for federal facilities to delegated states. We strongly support the concept of transfer of authority, as we have stated previously. We nevertheless have a number of concerns with the bill's specific provisions.

First, the bill would require that a state must have "demonstrated experience in exercising similar authorities" before the state can receive EPA authority over a federal facility. This requirement is quite vague -- what is meant by "similar authorities"? -- and goes beyond the requirements for delegation of authority over non-federal sites. We suggest that the provisions for the "transfer" to states of EPA authority over federal facilities should mirror the provisions for the "delegation" to states of CERCLA authority over other sites.

Second, the bill would allow a state to receive transfer of authority over a federal facility only if the state first agrees to abide by the terms of any existing interagency agreement covering that facility. Many interagency agreements for federal facilities were negotiated and executed without state participation, however. We believe it would be inappropriate to force such terms on a state.

Third, the bill does not expressly provide for transfer of authority over designated portions of federal facilities. At several sites, such as Rocky Flats in Colorado, state agencies are overseeing the cleanup of distinct portions of the larger facility, while EPA oversees the cleanup for the remainder of the facility. Such an arrangement allows for the maximum utilization of state and federal resources.

B. Waiver of Sovereign Immunity

The bill does not include a clear waiver of the federal government's sovereign immunity from enforcement actions under CERCLA and state law. We have consistently advocated that a clear waiver of federal sovereign immunity be added to CERCLA.

Under the ancient doctrine of sovereign immunity, the federal government is immune from a lawsuit unless Congress has expressly waived the immunity. Although Congress has attempted to waive the sovereign immunity of the federal government from enforcement actions under CERCLA and analogous state law, those attempts do not appear to have been entirely successful. The Supreme Court has interpreted waivers of federal sovereign immunity in environmental laws extremely narrowly, holding that such waivers must be "unequivocal," "construed strictly in favor of the sovereign," and "not enlarged beyond what the language requires." Moreover, at least two federal district courts have held that the CERCLA waiver of sovereign immunity from actions under state law does not apply to liability based on prior ownership of the facility. As Senator Stafford remarked during the SARA debates, "no loophole, it seems, is too small to be found by the Federal Government."

To ensure a complete waiver of federal sovereign immunity, Congress should revise the provision. Congress should add to CERCLA a waiver provision similar to that in RCRA as amended by the Federal Facility Compliance Act of 1992. Such a waiver was included in the 1995 House Superfund reauthorization bill. In addition, Congress should revise the waiver of federal sovereign immunity from actions under state law so that immunity from liability based on prior site ownership is clearly waived.

C. Criminal Liability Section 602 of SCAA would create a limitation on criminal liability for officers, employees, and agents of the United States. Such persons would not be subject to criminal liability for failure to take a response action under any state or federal law unless such person failed to request adequate appropriations to pay for the response action, or unless adequate funds were appropriated to pay for the response action.

We believe this provision is wholly unnecessary, and is likely to cause needless confusion. We suggest it be deleted from the bill.

VII. NATURAL RESOURCE DAMAGES (TITLE VII)

The natural resource damages title of S. 8 represents a substantial improvement over S. 1285. We very much appreciate that the Subcommittee has listened to our comments and addressed several of our concerns. However, we still have major concerns with these provisions of the bill, which would handicap most state programs.

A. Limitations on Natural Resource Damage Liability

1. Liability For Pre-1980 Injury. Section 701(3) of SCAA would substantially limit recovery for natural resource damages for injuries occurring prior to 1980. First, it would preclude recovery for "lost use" values that occurred before the enactment of CERCLA on December 11, 1980. Current law contains no such limitation on lost use values.

Second, the bill would preclude recovery for any damages if the release of a hazardous substance and the resulting injury occurred wholly before December 11, 1980. Current law, on the other hand, provides that there shall be no liability for natural resource damages "where such damages and the release of the hazardous substance from which such damages resulted have occurred wholly before" December 11, 1980. Thus, where a release occurs prior to the date of enactment and the resulting damages continue to occur after that date, liability exists for the post-enactment damages, but not for the pre-enactment damages.

The bill would greatly limit liability for releases of hazardous substances occurring prior to 1980. Under current law, a trustee may recover if the damages continue after 1980. Under the bill, a trustee would recover only if the injury continues after 1980. The distinction between damages and injury is a crucial one. If contaminants were released into a groundwater aquifer in 1979, and remain in the aquifer in 1997, the release and arguably the injury occurred prior to 1980, although the damages continue until the aquifer is restored. Under current law, a trustee may recover for the post-1980 damages; under the bill, it could not. Interpretation of the new language, moreover, would likely engender further litigation.

Such a restriction on liability will extinguish many claims that trustees currently have arising from the disposal and release of hazardous substances prior to 1980. Affected claims could include those for the Clark Fork site near Butte, Montana, the Coeur d'Alene site in Idaho, the Montrose site in southern California, Lavaca Bay in Texas, and the Hudson River PCB spills in New York. Several of these sites are the subject of ongoing litigation.

Under the common law, a party that was responsible for creating a nuisance many years ago remains liable for that nuisance so long as it continues. This common law concept was incorporated in CERCLA when it was enacted; it is consistent with principles of fairness and public policy promoting prompt abatement of nuisances, including those resulting from the release of hazardous substances. This common law concept should not be limited by these amendments.

2. Passive Use Values. Section 701 of SCAA expressly prohibits the recovery of damages for nonuse or passive use values. Similarly, section 702(a) of SCAA prohibits recovery for the costs of a contingent valuation study.

We are opposed to any limitation on recovery for passive use values, or any limitation on the use of contingent valuation methodology, as we have stated previously. "Passive use" refers to the value that is derived from the knowledge that resources exist and can be passed on to future generations. For example, most people would place a value on the Grand Canyon or Yellowstone National Parks, even though they do not expect ever to visit those places. Contingent valuation is a methodology used to estimate the value of resources that are not traded in the market, and it is the only methodology available to estimate passive use value. The methodology employs surveys of individuals having a stake in the given resource.

Economists widely recognize the validity of passive use values. In 1992, the National Oceanic and Atmospheric Administration commissioned the Contingent Valuation Panel, a blue ribbon of experts, including two Nobel laureates, to evaluate contingent valuation as a damage assessment tool. According to the panel, "for at least the last twenty-five years, economists have recognized the possibility that individuals who make no active use of a particular beach, river, bay, or other such natural resource might, nevertheless, derive satisfaction from its mere existence, even if they never intend to make active use of it." Courts have also recognized the validity of passive use values.

While the methodology for determining passive use value -- contingent valuation -- is quite controversial, the methodology is evolving and improving. It can be a useful tool in the effort to place a value on resources that are not traded in the market place, and on the environmental benefits of those resources. The report of the Contingent Valuation Panel concluded that a properly conducted contingent valuation survey can provide a useful measure of natural resource damages. We do not believe Congress should stifle the development of this methodology by legislation.

Moreover, for a contingent valuation study to be of any value in supporting a natural resource damage claim, it must meet the evidentiary standards for admissibility of scientific evidence in a federal court. The Supreme Court has recently spoken on this issue, holding that scientific evidence can be admitted only if the trial court finds that it is both relevant and reliable. A trial court must determine the reliability of scientific evidence by considering several factors: 1) whether the scientific methodology has been tested; 2) whether the methodology has been subjected to peer review and publication; 3) the rate of error of the methodology; and 4) the general acceptance of the methodology in the relevant scientific community. Thus, the courts would be required to pass on the reliability of any contingent valuation study, thereby providing a substantial check on the use of such a study to support damage claims. A poorly conducted contingent valuation study would not be admissible, or would be afforded little weight.

3. Cap on Liability. The bill would retain the cap on liability for natural resource damages without change from current law. S. 1285 would have revised the liability cap to substantially limit natural resource damage recoveries, a proposal that we opposed. We very much appreciate the elimination of these revisions in S. 8.

4. Double Recovery. Section 701(3) of SCAA would revise, and presumably expand, the prohibition on double recovery for natural resource damages. The revised language is somewhat ambiguous, however. It is also unclear why this revision is necessary, as CERCLA already includes an adequate prohibition on double recovery. We fear that the revised language may be interpreted to preclude recovery for any damages at sites for which response costs have been recovered.

B. Assessment and Restoration

1. Payment Period. Section 702(a) of SCAA would allow natural resource damage payments to be paid over a period of time. Such time period would be based on the period of time over which the damages occurred, the financial ability of the liable parties, and the period of time over which expenditures for restoration are anticipated.

We agree that a payment period based, in part, on the financial ability of the liable party, or on the agreed restoration schedule, may be appropriate. Trustee agencies currently take these considerations into account routinely, and we therefore question the need for a statutory provision. We do not agree, however, that the period of time over which the damages occurred should be a factor in determining the length of the payment period. It would be wholly illogical to delay the implementation of full restoration of injured resources simply because the activities that caused the injuries had been ongoing for a long period of time.

2. Regulations. Section 702(a) of the bill requires trustees to follow, to the extent practicable, natural resource damage assessment regulations promulgated by the Department of the Interior. Adherence to these regulations is optional under current law, and the regulations were written to be optional.

We do not believe adherence to the regulations should be required, even only "to the extent practicable." Strict adherence to these complex regulations will often result in lengthier, more complex assessments and significantly higher assessment costs, ultimately to be borne by the responsible parties. In many cases, the trustee agencies and the responsible parties may agree that the additional work needed to comply with the regulations may not be necessary or appropriate; but such work may be easily practicable.

Moreover, the bill fails to provide for any transition until new regulations are promulgated. The bill would require numerous revisions to the existing regulations, simply to comply with the bill's new damage assessment requirements. Until such revisions to the regulations are made, adherence to the regulations might be contrary to the requirements. At the same time, the bill would mandate a degree of adherence to the regulations. The trustees would be caught in a catch-22.

3. Rebuttable Presumption. S. 8 would eliminate the CERCLA provision that entitles a damage assessment conducted in accordance with the regulations to a rebuttable presumption on behalf of the trustee. We urge the Subcommittee to leave this provision of current law intact.

4. Record Review. Section 702(a) of SCAA would provide that trustees may establish an administrative record to support a restoration plan. We have proposed a somewhat similar amendment, and we are pleased to see a record review provision in the bill. Such a requirement would reduce the amount of litigation associated with natural resource damage claims and would allow a much more open decision-making process. We continue to support an express provision that a trustee decision based on the administrative record shall be upheld by a reviewing court unless found to be arbitrary and capricious or otherwise not in accordance with law.

5. Lead Trustee. The bill, in two separate and somewhat inharmonious subsections, would provide for designation of a lead trustee for natural resources. Section 702(a) would allow trustees to designate a lead administrative trustee or trustees for preparation of a restoration plan. Section 702(b) would require the Department of the Interior to promulgate regulations providing for, among other things, the designation of "a single lead Federal decisionmaking trustee" for each facility that will be subject to a damage assessment.

We have no objection to a general requirement for a "lead trustee," which is now contained in the federal damage assessment regulations. We have some concerns with the language of these provisions, however, particularly the second one which we believe is unnecessary.

First, we are troubled by the designation of a lead trustee having final decisionmaking authority. For a state trustee agency to place all decisionmaking authority in a single "lead" federal agency would be to surrender its sovereignty, an action that would be contrary to the law of many states.

Second, we have serious concern over designation as lead trustee of an agency that is also a responsible party. In our experience, federal trustee agencies have been much, much less cooperative where the trustee agency is a responsible party. The dual identity of natural resource trustee and responsible party, which afflicts many agencies, both federal and state, at many sites, is a recurring problem. We suggest that the bill be revised to prohibit the designation as the lead trustee of a federal or state agency that is a responsible party.

Third, in working with other trustee agencies, we have generally avoided naming a "lead" trustee, but have instead proceeded as "co-lead." This approach has worked well in our experience. The first provision seems to address this issue by allowing the designation of a lead "trustee or trustees." The second provision, perhaps inconsistently, requires designation of a "single" lead trustee.

Finally, we do not believe the second provision is necessary. The provision is totally redundant given the first provision and the regulatory requirement. It should be deleted.

C. Consistency

S. 8 contains two inconsistent provisions on consistency between response actions and restoration. Section 701(3) of SCAA requires a restoration action to be "consistent with all known or anticipated response actions." Section 703(a) provides that response actions and restoration actions "must not be inconsistent with one another."

We are very pleased to see the second provision (in section 703), which is very similar to the provision that we proposed. We believe the first provision is, consequently, unnecessary and should be deleted.

D. Statute of Limitations

S. 8 does not propose to correct the ambiguous statute of limitations for natural resource damages. Such a correction would reduce uncertainty and litigation over the limitation provision. We have long advocated correcting this provision.

CERCLA establishes a two-pronged statute of limitations period for claims for damages to natural resources. Such an action must be brought within three years of the later of: 1) "the date of the discovery of the loss and its connection with the release in question"; or 2) the date on which federal regulations are promulgated. These provisions are commonly referred to as the "discovery prong" and the "regulatory prong."

Each of these provisions is highly ambiguous. The "discovery prong" is vague and generally will not indicate a precise date. What constitutes "discovery of the loss" and "its connection with the release" is subject to a wide range of interpretations. The "regulatory prong" is also ambiguous, given the piecemeal promulgation of the natural resource damage assessment regulations issued by Interior. These ambiguities have resulted in considerable litigation. Indeed, the federal courts that have construed the language have given it three inconsistent interpretations.

Further, the current statute of limitations frequently puts a trustee in the awkward position of bringing an action for natural resource damages before a damage assessment has been completed and hence before the trustee can articulate the relief it is seeking. Until the damage assessment has been completed it is very difficult to quantify the damages.

Congress appears to have recognized these problems in passing the Oil Pollution Act of 1990 ("OPA"). Although earlier versions of the bill included statute of limitation language very similar to that in CERCLA the Senate amendment and conference substitute revised the provision, as enacted. It provides that an action for natural resource damages must be brought within three years from "the date of completion of the natural resource damage assessment." In most instances, this date can be readily and precisely determined, and therefore will not present an issue to be litigated. Congress should amend CERCLA to make the statute of limitations for natural resource damage claims consistent with that in OPA.

VIII. MISCELLANEOUS (TITLE VIII)

National Priorities List

Section 802 of SCAA would place a cap on new NPL listings. A total of 100 sites could be added to the NPL over the next five years, with no more than ten sites per year thereafter.

We are troubled by the proposed cap on NPL listing. Sites should be listed on the NPL on the basis of the risk they present to human health and environment, not on the basis of an arbitrary numerical limit. Similarly, sites should be added to the NPL for so long as sites continue to pose a serious enough threat to health and the environment as to warrant remedial action.

The cap on NPL listing might remove a major incentive for responsible parties to conduct voluntary cleanups. In New Mexico, as in other states, we have several sites for which NPL listing has been deferred pending negotiation of a voluntary cleanup agreement. The responsible parties for these sites, recognizing their potential CERCLA liability, have entered into negotiations to reach such agreements. If NPL listing is capped, these parties will realize that CERCLA liability may never be imposed, and much of their incentive to conduct voluntary cleanups will be lost.

IX. FUNDING (TITLE IX)

Funding For Natural Resources

The bill does not address the issue of funding for natural resource damage assessment and restoration activities. We have previously proposed amendments to provide that Superfund monies would be available to federal, state, and tribal trustees for damage assessments and restoration activities, as under the original law.

Section 111(c)(1) and (2) of CERCLA, which was originally enacted in 1980, expressly provides that Superfund monies may be used to conduct natural resource damage assessments and to restore, rehabilitate, replace, or acquire the equivalent of injured natural resources. This provision is contradicted, however, by section 517 of SARA, which amends section 9507(c)(1) of the Internal Revenue Code. As amended, that section provides that Superfund monies shall be available only for purposes "other than" the purposes set forth in section 111(c)(1) and (2), that is, for purposes other than damage assessment and restoration.

Given this limitation it is extremely difficult for trustees to fund natural resource damage assessments. Consequently, many state and tribal trustees are not conducting assessments and an important goal of CERCLA is not being met.

CONCLUSION

I want to thank you again for the opportunity to testify today on this important legislation. We look forward to working with you and your staff in revising SCAA to address these and other issues.