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Superfund litigation threatens public interest.

The recent proliferation of contribution actions by industrial polluters against private citizens and local governments including municipalities, school districts has been particularly acute in the state of New Jersey where 168 local governments have been sued or threatened with suit. Such suits have underscored the need for corrective legislation not only on the federal level, but also on the state level where the New Jersey Spill Compensation and Control Act ("Spill Act") is being employed in conjuction with the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, (CERCLA or Superfund) to shift responsibility for hazardous waste cleanups to local governments and their taxpayers.

The Spill Act -- the prototype for Superfund, was enacted by the New Jersey Legislature in 1977 and empowers the New Jersey Department of Environmental Protection and Energy (DEPE), to address the harmful effects of hazardous substances released into the environment. The legislation specifically empowers the DEPE to take response actions to abate any such release, to recover its response costs from responsible parties and to compel such parties to undertake cleanups of contaminated sites. Liability is not contingent on a finding of negligence or wrongdoing on the part of the generator or transporter and can attach even if the disposal was in full accordance with existing law. In other words, liability under the Spill Act is triggered as a result of the mere generation or transportation of hazardous substances.

The definition of "hazardous substances" is extremely broad and encompasses substances contained in household products commonly found in the municipal waste stream such as household cleaners, cosmetics, batteries, lawn fertilizers, consumer pesticides, and paint products. The presence of trace amounts of hazardous substances in household garbage is the principal excuse industry has seized upon to sue local governments for contribution under the Spill Act and CERCLA because neither statute expressly exempts household garbage from the definition of "hazardous substance".

However, the New Jersey legislature clearly did not intend that "taking out" or "picking up" household garbage should trigger Spill Act liability. Nevertheless, New Jersey local governments are already expending substantial sums of taxpayers dollars defending contribution actions predicated on the generation and transportation of household garbage by local governments and their citizens.

For example, 114 local governments are currently contribution defendants in the litigation relating to the GEMS Landfill in Gloucester Township, N.J. and the Helen Kramer Landfill in Mantua Township, N.J. The prescence of Spill Act claims in these lawsuits render it eminently clear that amendments to both the Spill Act and CERCLA are essential to protect our local governmets and our taxpayers from the abusive litigation practices.

Accordingly, New Jersey Senate Bill 95 and Assembly Bill 539 (referred to collectively as the amendment or bill) have been introduced to put an end to such litigation practices and restore the Spill Act to its original purposes. To ahcieve this result, the proposed amendment exempts municipal solid waste from the definition of "hazardous substance" and, in so doing, removes household garbage as a predicate for liability under the Spill Act. It is important to emphasize that the bill does not create "immunity" for local governments. Rather, the bill exempts the substance--household garbage--from liability and thus provides necessary protection for all generators or transporters of municipal solid waste--public entities, private businesses and individual homeowners.

In the event that a local government's involvement with a haardous waste site results from something other than the generation or transportation of municipal solid waste, the bill prohibits contribution actions by private parties. Such a provision is essential in light of the nature and scope of the activities performed by local governments and the tactics that are currently being employed by industrial parties in Spill Act and Superfund litigation.

Local governments, in providing for the health, safety and welfare of their citizens, regularly perform or contract for the performance of activities which involve hazardous substances which cannot fit within any credible definition of municipal solid waste.

Examples of such activities include the utilization and disposal of asphalt in road pavng, maintenance and repair and the removal of asbestos in schools and other public buildings. In GEMS Landfill case mentioned above, 53 scholl districts are defending contribution claims because waste oil removed by a contractor

from fuel storag e tanks at public schools "may" have been sXent to GEMS. Although specific dollar amounts have not yet been demanded from the GEMS school districts, experiences at other sites involving municipalities illustrate that the amounts demanded by industrial parties are reg ularly greatly disproportionate to local governments' contribution, if any, to the contamination at a particular site.

For example, in the case of the Lone Pine Landfill in Freehold Township, N.J., which involves a cleanup projected to cost $50 million, industrial polluters sued by the EPA have demanded in excess of $24 million from local governmental entities who have been accused of doing nothing more than sending municipal solid waste and sewage sludge to the landfill. Notwithstanding the fact that the aggregate volume of waste allegedlyu contributed by the local governments is less than 16 percent of the total volume at the site, the industrial parties at the site are attempting to shift roughly 50 percent of the cleanup cost to local government.

Rep. Christopher H. Smith of N.J., in introducing his own legislation, H.R. 2767, to amend CERCLA and eliminate the abusive lawsuits, correctly identified such tactics on the part of industrial parties as "shakedowns" of local governments.

Such "shakedowns" of local governments.

Such "shakedowns" will be eliminated if the abusers no longer have the ability to sue local governments directly. By eliminating the right of contribution, local governments remain in the liability scheme, where appropriate, but are given the opportunity of resolving their liability at the hands of the state which should lead to more equitable and realistic results.

Absent passage of appropriate legislative amendments to both CERCLA and the Spill Act, industry will continue the process of draining the already limited financial resources of local governments and their citizens by extorting disproportionate settlements and necessitating exorbitant litigation defense costs.

On a more subtle level, continuation of the existing litigation practices will continue undermining the public's confidence in the Spill Act and Superfund. As a number of municipalities and school districts ensnared in the existing liability scheme grows, so will a perception on the part of local governments and its citizenry that Superfund and the Spill Act represent financial threats to their communities rather than much needed solutions to severe environmental conditions.
 Ownership of Sites(1)
 Where Local Governments are Involved
 Ownership Number of Sites
 Local Government Owned(2) 179
 Privately Owned(3) 148
 Other(4) 48
 Federally Owned 17
 State Owned 5
 Indian Lands 3
 Unknown 2
 Total: 403

(1) Ownership information was obtained from EPA's and NPL databases. (2) Includes sites designated by CERCLIS and the NPL databases as "county" or "municipality" owned. (3) Includes nine sites that were previously owned by local governments. (4) Includes two sites that were previously owned by local governments.
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Title Annotation:Special Report: Prescribing Change for Superfund Law
Author:Farragher, Clare; Inverso, Peter
Publication:Nation's Cities Weekly
Date:May 25, 1992
Previous Article:Staggering local costs point to need for reform.
Next Article:National municipal policy on Superfund.

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