The EPA listed the Gowanus Canal on the Superfund National Priorities List in March 2010 and released a Remedial Investigation (“RI”) in early 2011 that reported elevated levels of polycyclic aromatic hydrocarbons (“PAHs”), polychlorinated biphenyls (“PCBs”) and metals.  Parts of the environmental investigation of the areas surrounding the Canal were performed by National Grid and New York City under Administrative Orders on Consent with EPA.

The Draft Feasibility Study proposes dredging, treating and disposing approximately 588,000 cubic yards from the Canal, at a projected cost of $351 million to $456 million.  EPA expects to release a Proposed Plan for its preferred remedy sometime in 2012.

In addition to assessing the dredging of the Canal, the Draft Feasibility Study states that “upland source controls,” including controls on CSOs and stormwater discharges, “need to be coordinated and implemented in concert with the selected sediment remedy[.]”   According to press reports, the New York City Department of Environmental Protection (“DEP”) expressed concerns about EPA’s CSO control plans, stating that the “primary sources [of canal contamination] are the former industrial plants on the canal, and not ongoing sewer overflows.”

EPA is accepting public comment on the Draft Feasibility Study and has tentatively scheduled a meeting for January 24, 2012, 7:00 p.m., at 330 Smith St., Brooklyn, to discuss the EPA’s plans.  For more information on the Gowanus Canal Superfund Site, contact David Yudelson or Michael Bogin.

The New York State Superfund Coalition (the “Coalition”), a group consisting of owners of inactive hazardous waste disposal sites, challenged DEC’s regulations as exceeding the authority derived from  the state Superfund law, which calls for the “complete cleanup” of  sites through the elimination of the “significant threat” posed by hazardous wastes.  The Coalition argued that the regulations’ reference to “pre-disposal conditions” went beyond this statutory authority, and allowed DEC to order the removal of “every last molecule” of contamination and to return sites to “pre-Columbian” conditions.

The Court of Appeals rejected this claim, stressing that the stated goal of a “complete cleanup” is “aspirational” because that goal “can be constrained by technological feasibility, cost-effectiveness, and procedural due process, among other things.”

Before initiating a remedial investigation at a state Superfund Site, DEC must first determine that site presents a “significant threat” to public health or the environment.  In his dissent from the Court of Appeals’ decision, Judge Eugene Pigott wrote: “[I]t is clear from the statutory language that the Legislature intended to limit the reach of the remedial program to the ‘elimination of the significant threat’ … [and that] DEC’s interpretation of [this provision] goes beyond what any competent Legislature would permit.”

Both the majority opinion and the dissent, however, emphasize that DEC cannot make arbitrary or draconian remedial decisions without such decisions being subject to challenge under the rules.  DEC has recognized in practice and in its regulations that it may not be feasible to return industrial sites to a state of nature given the complexity of issues presented by such sites, and that technical and economic feasibility are, therefore, appropriate considerations under the Superfund scheme.  The Court of Appeals found that the challenged regulations were consistent with DEC’s current practice of making remedial decisions that involve less than complete removal, provided that the remedial action protects public health and the environment.

For more information on the remediation of inactive hazardous waste sites in New York, contact Mark Chertok, Michael Bogin, or Jennifer Coghlan.

Before contaminated property is sold or remediated, federal and state law and transactional due diligence generally require an environmental site assessment to be conducted pursuant to ASTM standards.  Such assessments may be undertaken to preserve the innocent landowner, bona fide prospective purchaser, or contiguous property owner defenses to Superfund liability, which require “all appropriate inquiries” into the environmental conditions on a given site and impose “continuing obligations” to stop, prevent, or limit human exposure to hazardous substance releases.   

Under EPA regulations, compliance with ASTM’s Phase I site assessment standards (E1527-05 or E2247-08) is sufficient to establish “all appropriate inquiries” for the purpose of these defenses.

After more than two years of review and deliberation, ASTM recently revised its Standard Practice for the Phase II Environmental Site Assessment Process (E1903-11).  Phase II site assessment involves the sampling of soil, groundwater or other exposure pathways, typically after a Phase I reveals a likelihood of contamination.  While Phase II assessments are not required under Superfund regulations, they can be useful in determining what “continuing obligations” are needed to establish landowner liability protections.  Phase II assessments may also be required as part of transactional due diligence or to inform a company’s disclosure of its environmental liabilities. 

Recognizing the variety of contexts in which Phase II assessments arise, the revised ASTM standards set forth an iterative process, emphasizing communication between the “user” who commissions the assessment and the “assessor” who performs it.  Unlike the prior standards, the new version requires the user and assessor to agree upon a written statement of objectives that sets the scope of the investigation.  These objectives are tailored to the user’s needs; they can limit the investigation to only certain parts of the Site or certain contaminants, or expand it beyond the recognized environmental conditions (“RECs”) identified in a Phase I.  These objectives may be revised throughout the assessment process, as sampling increases the amount of information about environmental conditions on Site, culminating in the production of a written Phase II Report. 

Last July, ASTM released a new “Standard Guide for Identifying and Complying with Continuing Obligations” (E2790-11).  These standards establish a four-step process for developing and implementing a “continuing obligation plan,” which will be tailored to meet site-specific conditions.  Since “continuing obligations” are broadly defined under CERCLA and its regulations, courts may look to the new ASTM standards for more specific guidance.

For more information on ASTM’s new standards and the environmental site assessment process, contact Michael Bogin or Christine Leas.

TCE was used extensively as a degreaser and a solvent, and is one of the most prevalent contaminants in the United States.  It is found in soil and groundwater at numerous Superfund sites, and its presence has led to the closure of water supply wells around the country, including on Long Island.  TCE also can vaporize into the air when it is present in soil or groundwater. In some areas, this has led to the presence of TCE in indoor air of buildings overlying TCE-contamination; so-called “vapor intrusion”.

EPA has indicated that it will take its Health Assessment into account in the following areas:

1. Establishing cleanup methods at Superfund sites where TCE has been identified as a contaminant;

2. Understanding the risk from vapor intrusion as TCE vapors move from contaminated groundwater and soil into the indoor air of overlying buildings;

3. Revising EPA’s Maximum Contaminant Level for TCE in drinking water; [and]

4. Developing appropriate regulatory standards limiting the atmospheric emissions of TCE – a hazardous air pollutant under the Clean Air Act.

It remains to be seen whether EPA’s determination will impact the judgments of state regulators, including those in New York.  For more information on issues arising at TCE-contaminated sites, contact Christine Leas or David Yudelson.

Newly created land banks will need to exercise caution in acquiring abandoned and foreclosed property, which are often contaminated from historic industrial activity.  Such contamination may have been a factor contributing to the abandonment of the property, particularly in economically depressed areas.  Federal and state laws can impose strict liability on owners of contaminated property to address the actual or potential release of hazardous substances.   Although these laws provide a defense to government entities acquiring property involuntarily or through eminent domain, such defenses do not appear to be available to a land bank.  Land banks would be well advised to consider this risk and to protect themselves by conducting due diligence investigations before taking title (in order to qualify for certain statutory defenses to liability) or by delaying taking title until a developer or other entity has been identified with the financial capacity and willingness to assume environment liability for past contamination.

EPA estimates it will take years to complete the RI/FS. The parties have already completed a work plan for the investigation, which is scheduled to begin in August 2011, and will include analysis of Newtown Creek’s sediment, surface water, and surrounding air. Once the investigation has been completed, the parties will evaluate the feasibility of cleanup options.

EPA has stated that it plans to start developing a community advisory group later this summer. EPA plans to hold a meeting to consult with the Brooklyn and Queens communities before the end of the summer.

Cleanup efforts will face significant challenges.  According to EPA, Newtown Creek is one of the most polluted sites in the country. Due to the ready access it provides to the New York Harbor, Newtown Creek has been the site of intense industrial development dating back to the 1800s.  It has served as home to petrochemical plants, fertilizer factories, glue factories, sawmills, lumber and coal yards, and more than fifty oil refineries, including America’s first. In addition to its history of heavy industrial use, Newtown Creek has also been impacted by a serious oil spill at Exxon Mobil’s Greenpoint refinery that was discovered in the 1970s.  This spill is estimated to have discharged 17 million gallons of oil, much of which migrated into Newtown Creek.

SPR represents a number of current and prospective property owners along Newtown Creek in connection with the remediation and redevelopment of such properties for productive use. For more information about Newtown Creek and the surrounding area, please contact SPR partner Michael Bogin.

Devin McDougall is a Summer Associate at Sive, Paget & Riesel

In one of the first cases of its kind in New York, on June 24, 2011, CAEUSA Inc. (“CAE”), a supplier of flight simulators and related products, filed a federal lawsuit against neighboring property owners, seeking $2.1 million in response costs and damages for soil vapor contamination allegedly arising from releases of solvents on neighboring properties.  As a result of soil vapor issues in Endicott, NY and elsewhere, DEC is reviewing, and in many cases, reopening, prior remediation approvals to address soil vapor contamination.    

CAE asserts that, in 1998, it expended approximately $4 million on remediation of soil contaminated with chlorinated solvents at its property near Binghamton, New York pursuant to consent orders with DEC.  CAE later sold that property but retained contractual responsibility for pre-closing contamination.  In 2003, DEC began an extensive investigation of the intrusion of soil gas and soil vapor into properties neighboring the former CAE site.  Based on that investigation, DEC installed more than 120 vapor mitigation systems in the neighboring properties. 

According to the complaint, DEC is seeking $2.1 million from CAE for its costs in investigating the soil vapor contamination and installing the vapor mitigation systems.  In its complaint, CAE alleges that necessary remediation of its property was conducted and that its site is not contributing to the soil vapor contamination of the neighboring properties, where vapor mitigation systems were installed as a result of DEC investigation.  CAE alleges that current and past owners and operators of manufacturing and commercial properties neighboring the former CAE site are responsible for the off-site soil vapor conditions.    

CAE’s complaint presents data showing that soil vapor associated with the plaintiff’s property is minimal in contrast with very high levels at and emanating from the defendants’ properties.  It also presents detailed allegations de-linking the soil vapor contamination from any residual groundwater contamination that could be connected to CAE.  CAE’s lawsuit signals that courts will now be forced to grapple with the complicated issues faced by DEC with respect to soil vapor intrusion: the complexities of site data, the evidence needed to pursue parties for vapor intrusion, and the reopening of cleanups previously approved and closed by the agency.

Sive, Paget & Riesel represents a number of property owners on vapor-intrusion evaluations and re-openings.  For more information on this topic, please contact Christine Leas, Jeffrey Gracer or Michael Bogin.

EPA’s nomination of the NCH Site reflects an emerging trend toward large, multiparty Superfund sites in the New York metro area.   In addition, since 2009 the rate at which EPA has been adding sites to the NPL has increased from prior years, and the recent nominations reinforce this trend.

Complex, multiparty sites were relatively common in the two decades following CERCLA’s enactment in 1980.  EPA listed many former landfills, casting a broad liability net over dozens of potentially responsible parties (PRPs) at a time, and these sites often involved tens or hundreds of millions of dollars in response costs.  However, while listings continued, by 2005 practitioners and commentators had noted a dropoff in large government-led cleanups.[1] Around this time, intense economic pressures to develop property also resulted in many voluntary cleanups by parties who had no prior connection to the contamination.  The focus of CERCLA practice shifted accordingly, from EPA-led megasites to voluntary cleanups, with courts scrutinizing the legal avenues of recovery for volunteers under the statute’s cost recovery and contribution provisions.[2]

More recently, the EPA has named several large, complex, and costly sites in the New York metropolitan area to the NPL, including the Gowanus Canal and Newtown Creek, each estimated to involve cleanups costing hundreds of millions of dollars.  EPA is also pursuing efforts to investigate and remediate portions of the Lower Passaic River, as part of the Lower Passaic River Restoration Project.  At another large cleanup site, in July 2010, 100 PRPs signed on to conduct a Remedial Investigation/Feasibility Study for the Berry’s Creek study area in Bergen County, NJ.  The first phase of dredging of the Hudson River Superfund site by General Electric began in 2009 and cost approximately $560 million.  As the above examples illustrate, EPA’s Region 2 appears increasingly focused on contaminated waterways, which by their nature involve complex and costly cleanups.

The rising number of Superfund sites is not just a local development; the number of listings is on the rise nationwide.  Between 2003 and 2008 EPA listed an average of 14.6 new sites per year.  By contrast, in the first few months of this year, 25 sites have already been proposed or listed, and if all those sites are listed average new listings per year since 2009 will jump to 21.6—50% over the previous five years.  Of course, more sites may also be listed in the remaining nine months of 2011.[3]

• Read more on Superfund/CERCLA

The migration of vapors from subsurface contamination into overlying buildings, known as vapor intrusion, is a growing concern for federal and state environmental regulators.  Vapor intrusion is most common at sites with elevated levels of volatile organic compounds – including chlorinated solvents and sometimes gasoline – which enter indoor air through openings around sewer lines, cracks in a building’s foundation or basement, or other preferential pathways.

Under the federal Superfund law, EPA screens contaminated sites for listing on the NPL through its Hazard Ranking System, assigning each site a score based upon its perceived threat to human health and the environment.  The risk of vapor intrusion, however, does not currently factor into this determination.  A May 2010 Government Accountability Office (“GAO”) report found that, given EPA’s inability to designate NPL sites on the basis of vapor intrusion, “States may be left to remediate those sites without federal assistance, and given states’ constrained budgets, some states may not have the ability to clean up these sites on their own.”

From now through April 16, 2011, EPA will be collecting public comment on the potential revision of the Hazard Ranking System (“HRS”) to account for vapor intrusion.  It plans to hold three public listening sessions on the topic.  While it has not proposed specific regulatory changes at this point, the Agency “will consider the information gathered from this Notice, listening sessions, and other sources before making a decision to issue a proposed rulemaking to add subsurface contaminant intrusion to the HRS.”

EPA is also in the process of revising its draft guidance for the evaluation of vapor intrusion risks, which was initially released in 2002 but has yet to be finalized.  EPA outlined a number of likely changes to that document last October, and it plans to issue updated guidance by November 2012.

Finally, the New York State Department of Environmental Conservation is continuing to reevaluate vapor intrusion pathways, and has reopened several sites that had already been remediated and delisted to require additional monitoring or mitigation measures.  For more information on these reopenings, or on federal and state vapor intrusion policy developments, contact Christine Leas, Jeffrey Gracer, or Michael Bogin.

The subject site, which is adjacent to the Newtown Creek Superfund site, has been home to heavy industry since the mid-1860’s and has a long history of contamination.  According to the New York State Department of Environmental Conservation, (“DEC”) approximately 17 million gallons of petroleum products have been released, over time, to the subsurface of the northeastern area of Greenpoint, resulting in a spill area that extends over 52 acres.  The spill was discovered in 1978, and product recovery systems have been in place since 1979.  Currently, cleanup operations are being conducted by ExxonMobil, BP, and Texaco under DEC supervision.

The State has long played a role in seeking to spur efforts to clean up the spill.  In 1990, ExxonMobil’s predecessor, Mobil, and the New York State Department of Environmental Conservation (“DEC”) entered into two consent orders whereby Mobil agreed to investigate and remediate petroleum-related “free product” – contaminated petroleum material that floats on top of groundwater – associated with a former Mobil refinery.  In 2007, the State filed in Federal court the action which has now been settled, alleging that ExxonMobil was liable for response, remediation, and other costs incurred by the State in connection with the entire spill.  These claims were brought pursuant to the Resource Conservation and Recovery Act (“RCRA”), the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA), the Oil Pollution Act, the New York State Navigation Law, the New York State Environmental Conservation Law, and the New York common law of public nuisance, indemnification, and restitution.

Key features of the consent order include the following:

• ExxonMobil is presumptively responsible for the investigation and remediation of “contamination in all media” at the Site, delineated by an attached map, within ExxonMobil’s “Historic Footprint” (the portion of the Site formerly or currently owned or operated by ExxonMobil or its predecessors).  The obligation extends not only to free product, but also to contaminated groundwater, soil, and soil vapors.
• ExxonMobil is presumptively responsible for the investigation of contamination within the Site where DEC has a technically reasonable basis to conclude that existing contamination emanated from the Historical Footprint and followed a preferential pathway such as a utility or pipeline.
• In portions of the Site outside of the Historical Footprint, ExxonMobil is presumptively responsible for the investigation and remediation of petroleum-related groundwater contamination, petroleum-related soil vapor contamination, and petroleum-related contamination in media located in an area specified as the “Retention Zone.”  ExxonMobil’s obligation to investigate and remediate soil contamination is limited to the historic extent of the mapped free product plume.
• To ensure an expeditious cleanup, ExxonMobil must adhere to a schedule and meet specific milestones in its operations.
• ExxonMobil must pay a total of $25 million to the State, to be allocated as follows:
  • $19.5 million to fund Environmental Benefit Projects to improve the environment in Greenpoint.  Projects should address issues that include, but are not limited to, water quality, groundwater, open space, reduction of toxic pollution, and air quality.
  • $1.5 million to compensate the State for past cleanup costs related to the spill.
  • $3.5 million to fund future oversight costs.
  • $250,000 in penalties to be deposited in New York’s Oil Spill Cleanup Fund and Marine Resources Account.
  • $250,000 in damages, which will be used to fund projects to compensate for damaged natural resources in Greenpoint.

The consent order is also notable for the items it does not address or require, including the following:

• The consent order does not address ExxonMobil’s obligations with respect to Newtown Creek, which is now listed as a federal Superfund site. The State reserves all of its rights with respect to Newtown Creek in the consent order.
• The consent order limits to some extent ExxonMobil’s responsibility for the investigation and remediation of those contaminated properties at the Site identified as the “BP Property”, the “Peerless Property”, the “100-120 Apollo St. Property” and the “Metro Property.”

For more information, visit the following links:

• Consent Decree
• New York Attorney General’s Press Release
• New York Times article on the settlement.