Statement of the Honorable E. Benjamin Nelson
Governor of Nebraska
before the Committee on Environment and Public Works United States Senate
on Superfund Reform on behalf of The National Governors' Association
September 4, 1997

Introduction

Good morning Mr. Chairman and members of the committee. My name is E. Benjamin Nelson. I am Governor of the state of Nebraska and chair of the National Governors' Association (NGA) Committee on Natural Resources. This testimony is presented on behalf of the National Governors' Association, but has been developed in close consultation with the Environmental Council of States (ECOS) and the Association of State and Territorial Solid Waste Management Officials (ASTSWMO), which represent state officials who manage the Superfund program on a daily basis.

The states have a strong interest in Superfund reform and believe that a variety of changes are needed to improve the Superfund program's ability to clean up the nation's worst hazardous waste sites quickly and efficiently. We commend U.S. Environmental Protection Agency (EPA) Administrator Carol Browner for many of the administrative reforms she has developed for this program. However, we still believe that legislation is required. If I leave you with one message today, let it be our hope that senators on both sides of the aisle will continue to work in a bipartisan fashion to craft a Superfund reform package that can be signed into law. The Governors are committed to doing everything within our power to assist in that effort and hope to continue working cooperatively with both the majority and the minority to develop a final bill that enjoys broad bipartisan support and can be signed by the President.

Mr. Chairman, Senator Smith, I want to commend you for developing a very good starting point for the kind of bipartisan negotiations that are required to develop a bill the President can sign. I know that there remain important differences between Republicans and Democrats and between states and the administration, but we see the chairman's mark as a significant step toward resolving the concerns that were expressed by both EPA and the states concerning the underlying bill. Important compromises have been made in the development of this legislation, and we hope the spirit of compromise will continue on a bipartisan basis.

The states appreciate the opportunity to review and comment on the draft chairman's mark dated August 28, 1997. Today, I would like to address NGA's overall assessment of the bill and suggest a few areas where improvements could be made.

Brownfields Revitalization and Voluntary Cleanup Programs

The Governors believe that brownfields revitalization is critical to the successful redevelopment of many contaminated former industrial properties, and we commend the committee for including brownfields language in the bill.

The Governors would like to emphasize the importance of state voluntary cleanup programs in contributing to the nation's hazardous waste cleanup goals. States are responsible for cleanup at the tens of thousands of sites that are not on the National Priorities List (NPL). In order to address these sites, many states have developed highly successful voluntary cleanup programs that have enabled sites to be remediated quickly and with minimal governmental involvement. It is important that legislation support and encourage these successful programs by providing clear incentives and flexibility. Frankly, we feel an increased need for congressional direction because the guidance on state voluntary cleanup programs that EPA is about to finalize does not afford us the necessary and appropriate flexibility. It is the view of states that voluntary cleanup programs and brownfields redevelopment are currently hindered by the pervasive fear of federal liability under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) of 1980. We strongly support the provisions in the chairman's mark that encourage potentially responsible parties and prospective purchasers to voluntarily clean up sites and reuse and redevelop contaminated property. The draft achieves this goal by precluding subsequent federal enforcement at sites where cleanup has occurred under state programs and by providing needed liability protections for prospective purchasers and owners of property contiguous to contaminated sites. However, in the event EPA discovers an imminent and substantial threat to human health and the environment at a site, NGA does support EPA's use of its emergency removal authority. We also believe that an important provision has been included that clarifies EPA's authority to take action at a site if a state requests the President to do so. Any assignment of liability, however, must be consistent with liability assigned under state cleanup laws.

Finally, we would like to make the distinction that while the draft would preclude federal enforcement for sites in a state voluntary cleanup program, you have not provided a release from federal liability. We believe that this would leave potentially responsible parties vulnerable to third party suits and would effectively take much of the incentive out of entering a state voluntary cleanup program. We would like to work with the committee to address this provision.

State Role

The impacts of hazardous waste sites are felt primarily at the state and local levels, so each state should have the option to take over and administer as much of the program as they can. The Governors support the efforts of Senators Chafee and Smith to provide us with options to enhance the role of states in this program. We appreciate the inclusion of options for authorization, expedited authorization, delegation, and limited delegation by agreement in the draft and feel that this allows for maximum flexibility to meet state needs and objectives. We especially support the authorization provisions that allow states to operate their programs in lieu of the federal program. Where a state is authorized to operate a program in lieu of the federal program, states should receive adequate federal financial support.

The creation of an expedited process to delist from the NPL a site for which a state has assumed responsibility will help provide a necessary finality to the Superfund process and will help prioritize time and money on remaining problems.

However, the states cannot support allowing EPA to withdraw delegation on a site-by-site basis. EPA should periodically review state performance instead of involving itself in site-by-site oversight. If program deficiencies are found, a state should have an opportunity to resolve them before EPA proceeds to withdraw authorization or delegation. Withdrawal of delegation should be consistent with the criteria for approval or rejection of a state's application for delegation.

The Governors strongly support a 10 percent state cost-share for both remedial actions and operations and maintenance and appreciate the retention of this provision in the chairman's mark. The Governors would like to ensure that the provision for states to petition the Office of Management and Budget (OMB) is a workable mechanism to deal with any cost-shifts resulting from changes in liability, and that reform does not result in a higher cost-share than states currently pay.

Selection of Remedial Actions

Because of the complexity and importance of the title on "Selection of Remedial Actions," I would like to respectfully request more time to provide detailed comments and have them included in the record after we have had time for more adequate review. Although we will undoubtedly have some comments with this title, there are several key improvements that I would like to touch on today.

The Governors believe that changes in remedy selection should result in more cost-effective cleanups; a simpler, more streamlined process for selecting remedies; and a more results-oriented approach. We believe the bill moves significantly in this direction. Many of these reforms seem to us to be codifications and improvements of EPA's administrative reforms.

As you know, allowing state-applicable standards to apply at both NPL and state sites is of great importance to the Governors. We greatly appreciate and strongly support measures to allow state applicable standards and promulgated relevant and appropriate requirements to apply to all site cleanups. The Governors agree with the importance of considering different types of land uses when determining cleanup standards and appreciate the inclusion of provisions in the bill that provide for state and local control in making determinations of foreseeable land uses. We would like to ensure that, when appropriate, feasible, and cost-effective, the cleanup standards chosen allow for unrestricted use of the site. In addition, we would like to ensure that land-use decisions are not second-guessed by EPA.

The Governors believe groundwater is a critical resource that must be protected. The use of state applicable standards and the opportunity for state and local authorities to determine which groundwater is actually suitable for drinking are essential during the remedy selection process. While we believe that groundwater needs to be protected, we need to ensure that these provisions are workable and flexible.

The Governors recognize that there are some records of decision (RODs) that should be reopened because of cost considerations or technical impracticability. However, we have been concerned about a flood of petitions to reopen, and we believe the Governor should have the final decision on whether to approve a petition to reopen a ROD in his or her state. We particularly appreciate the efforts of the committee to improve the draft by removing the provision in S. 8 that would allow a remedy review board to override a Governor's veto of a petition to reopen a ROD. NGA believes that this is a very important addition.

We would also like to commend you on removing the provision in S. 8 that would preempt state liability laws at sites where EPA has released a potentially responsible party from federal liability because the site has been cleaned up for unrestricted use. As you know, the Governors do not support preemptions of state law and are grateful to you for incorporating our recommendations in your draft.

Liability

The liability scheme employed in any hazardous waste cleanup program is critical to the success of that program. The current CERCLA liability scheme serves some purposes well. It has proved effective at encouraging better waste management, and it has provided resources for site cleanups. However, the current system has a history of leading to expensive litigation and transaction costs. Therefore, the Governors are not averse to some changes in liability, though we are concerned with the resulting effects on the states. In general, we support the elimination of de minimis and de micromis parties and believe the liability of municipalities needs to be addressed. However, we question broader releases of liability for other categories of responsible parties. In any case, we would like to see convincing analysis that any changes in the liability scheme provide adequate assurance and funding so that sites will continue to be cleaned up and so that there will be no cost shifts to the states.

Although it is clear that much effort has been focused on finding compromises and creating a more equitable system, the Governors are still concerned that the changes to the federal liability scheme are not complementary to state liability programs. We are particularly opposed to the apparent preemption of all state liability laws when a facility has been released from federal liability. Preemption of state liability laws at NPL sites effectively creates an inequitable situation in states because it creates an inconsistency in application of state law at sites throughout the state. We want to avoid creating a scenario where there is a demand by potentially responsible parties to be added to the NPL because the federal liability scheme is more favorable.

As I mentioned earlier, we fully support a release of federal liability at non-NPL sites where a release of liability has been granted under state cleanup laws protective of human health and the environment. Much emphasis has been placed on modifying the language on liability, and we do not want to discount the obvious efforts at compromise that can be seen in this draft. However, we would like more time to review the provisions of this title and would like to work with the committee to create a system that has fewer adverse impacts on state programs.

Federal Facilities

The Governors support legislation that ensures a strong state role in the oversight of federal facility cleanups. The double standard of separate rules applying to private citizens and the federal government has a detrimental effect on public confidence in government at all levels. Therefore, the Governors believe that federal facilities should be held to the same process and standard of compliance as private parties. We would like to make sure that the intent of language in the draft allows state-applicable standards to be applied at federal facility sites in the same manner that they apply at nonfederal facility sites.

The states would like to commend the committee for including provisions in the chairman's mark allowing EPA to transfer responsibility for federal facilities to states. However, we are unclear why the process is different and the provisions much more restrictive than the provisions in Title II for nonfederal sites on the NPL. One interpretation is that responsibility for federal facilities may be transferred to states, but that states must at all times use the federal remedy selection process. We do not understand the justification behind this language and would be greatly concerned if this precludes states from applying state applicable standards to federal facilities if they are more stringent than the federal standards.

In addition, in virtually every other environmental statute, Congress has waived sovereign immunity and allowed states to enforce state environmental laws at federal facilities. A clearer, more comprehensive sovereign immunity waiver should be developed that includes formerly used defense sites.

Natural Resource Damages

The current natural resource damage provisions of CERCLA allow federal, state, and tribal natural resource trustees to require the restoration of natural resources injured, lost, or destroyed as a result of a release of a hazardous substance into the environment. The Governors feel this is an important program that must be maintained. We commend the committee for emphasizing restoration as the primary goal of this program, extending the statute of limitations to three years from completion of a damage assessment, and creating an effective date to protect claims and lawsuits already filed. Protection of existing claims and lawsuits is a very important provision for all Governors, particularly Governor Marc Racicot of Montana who serves as vice chair of NGA's Committee on Natural Resources. We also suggest that the committee consider removing from the trust fund the prohibition on funding natural resource damage assessments and giving state trustees the right of first refusal to be lead decisionmaker at NPL sites with natural resource damages. We also support retention of nonuse damages.

Miscellaneous

The states would like to applaud the inclusion in this draft of a provision to require the concurrence of the Governor of a state in which a site is located before a site may be added to the NPL. NGA has fought long and hard to have this vitally important provision included in legislative proposals.

We have concerns about an annual "cap" or limit on NPL listings. We believe that by requiring a Governor's concurrence on any new listings, a sufficient and appropriate limitation is placed on new listings. Further limitations are unnecessary. Because of differences in capacities among states, the complexities and costs of some cleanups, the availability of responsible parties, enforcement considerations, and other factors, limitations on new listings could result in some sites not being cleaned up. We believe there should be a continuing federal commitment to clean up sites under such circumstances, regardless of whether an arbitrary cap has been exceeded in any given year. The states are interested in working with the committee to resolve our concern.

Conclusion

Mr. Chairman, I would like to thank you for your hard work on this important reform legislation and for providing me with the opportunity to communicate the views of state government on Superfund reform. Again, NGA, ECOS, and ASTSWMO are very encouraged by the direction you have taken with this legislation and are pleased that this draft reflects many important compromises that should enjoy bipartisan support. We hope that members of both parties will roll up their sleeves to pass Superfund reform legislation. I look forward to working with both the majority and minority to bridge any differences and craft legislation that can be signed into law.