SENATE BILL REPORT
E2SHB 434
BYHouse Committee on Ways & Means (originally sponsored by Representatives Unsoeld, May, Rust, Walker, Pruitt, Hine, Leonard, Winsley, Lux and Todd; by request of Department of Ecology)
Providing for procedures to protect the public from hazardous substances.
House Committe on Environmental Affairs
Senate Committee on Parks & Ecology
Senate Hearing Date(s):March 25, 1987; April 3, 1987
Majority Report: Do pass as amended and refer to Committee on Ways & Means.
Signed by Senators Kreidler, Chairman; Rinehart, Vice Chairman; Hansen.
Minority Report: Do not pass.
Signed by Senators Bluechel, Kiskaddon.
Senate Staff:Henry Yates (786-7708)
April 6, 1987
AS REPORTED BY COMMITTEE ON PARKS & ECOLOGY, APRIL 3, 1987
BACKGROUND:
Numerous sites where hazardous wastes have contaminated soil, water, or air have been discovered in the state and it is estimated that currently one to two new sites per month are being revealed. Some sites in the state will be eligible for cleanup under the federal Superfund program, which details steps the Environmental Protection Agency must follow when it discovers a site. It also provides funding. The federal program has provisions for assessing liability, specifying how funds can be spent, procedures for investigation and cleanup, enforcement authority, penalties, etc. Monies spent from the federal Superfund are used only if the persons responsible for the contamination do not act. The federal government then attempts to recover the costs in court. Sites that are cleaned up using Superfund money require the state to provide 10 to 50 percent of the total cleanup costs. Only the worst sites are eligible for federal monies. The majority of sites in any state are not eligible.
A state program somewhat like Superfund, which details steps the Department of Ecology must take once a site that is ineligible for federal funding is discovered is needed. Funding for the state program and money to match federal cleanup funds would accompany it.
The Department of Ecology has identified 158 contaminated sites in the state and is currently assessing 400 potential sites. The agency estimates that $203 million will be needed to clean up hazardous waste sites for the next two years.
In addition to cleaning up sites, the state is also responsible for the ongoing regulation of hazardous wastes. Under the Hazardous Waste Management Act, the Department of Ecology is directed to regulate the production, transportation, storage, treatment and disposal of hazardous wastes.
In order to fund both the hazardous waste regulatory program and a state cleanup program, and to provide adequate authority for the Department of Ecology to enforce cleanup actions, the Legislature passed the Hazardous Waste Fee Act in 1983. This act imposes fees on all persons who generate, treat, store or dispose of hazardous wastes. This fund has been inadequate to cover the costs of the regulatory program. The unfunded portion of the regulatory program and all cleanup costs are currently funded by the general fund.
The Hazardous Waste Fee Act provides some authority for the Department of Ecology to conduct and enforce cleanup actions, but the department claims the authority is not adequate to ensure safe and efficient cleanups in the state.
SUMMARY:
The Department of Ecology is allowed to participate in the federal hazardous waste management (RCRA) and cleanup (CERCLA) programs. It also may adopt rules to carry out any provision of the chapter.
The Department of Ecology is required to maintain a list of all potential hazardous waste sites in the state and provide annual reports to the legislature on actions taken.
Persons who generate waste, transport waste, or who own or operate a hazardous waste facility are responsible for proper handling of the waste. If these wastes are released into the environment, these persons are subject to strict, joint and several liability for the costs of cleanup. Persons who both sell hazardous substances and prepare instructions for the use of the hazardous substances may also be subject to the liability provisions if the hazardous substances cause environmental contamination when used in accordance with the instructions. Innocent purchasers of property or persons who contributed an insignificant amount of waste to the problem are exempt from the liability provisions.
If Ecology has a reasonable basis to believe there may be a release of a hazardous substance or threatened release it can require, upon reasonable notice information relevant to the release. The responsible party(s) must grant agency representatives access to inspect records.
If there is a reasonable basis to believe there is a release or threatened release, upon reasonable notice, Ecology can enter property to sample or inspect.
After the investigation, the department will notify persons who may be responsible for the contamination. Persons receiving notice of potential responsibility have 45 days to prepare a response action plan for cleanup. The plan will include monitoring provisions and will identify the level of cleanup that must be obtained. The plan may also include a request for a covenant not to sue. Public notice and comment opportunities are provided. The department must base its decision on whether to accept or reject a plan on specified criteria. If the responsible parties fail to submit a plan or if an unacceptable plan is submitted, the responsible parties are liable for the costs incurred by the department to clean up the site. If the failure is willful, or if the responsible parties fail to comply with an agency enforcement order, they are liable for up to three times cleanup costs.
When the responsible parties have implemented the response action plan, they may apply to the department for certification of completion. The department will accept public comment on the application for 90 days. If the plan has been fully implemented the department will issue a certification of completion.
When the department certifies that a cleanup is complete, the department must grant a requested covenant not to sue for any portion of a cleanup that 1) destroys or eliminates the hazardous substances; 2) transports hazardous substances to an approved disposal facility or 3) meets the express standards of applicable state and federal laws.
If the department finds the issuance of a covenant not to sue would be in the public interest, the department may issue a covenant not to sue when 1) the cleanup standard is based on relevant and appropriate state and federal laws; 2) the department sets a standard on a case by case basis because no standards exist, or 3) there has been a deviation or variance from existing standards. A covenant not to sue may only be issued when a deviation is granted if the department finds that issuing a deviation provides optimum protection of human health and the environment, and that meeting existing standards is technically impractical from an engineering perspective.
A covenant not to sue will limit the responsible parties' future liability to the state. If the department grants a covenant not to sue to the responsible parties and later finds that the site needs additional cleanup, the state may be liable for some of the clean up costs. A covenant not to sue will apply only to those hazardous substances and those areas specifically identified in the plan. The covenants not to sue will only continue for as long as the tax imposed by this act remains in effect.
If responsible parties fail to undertake cleanup activities, the department is required to take actions to ensure the site is cleaned up.
The decisions of the department regarding acceptance of response action plans, issuance of covenants not to sue, or certification of completion are subject to review. Responsible parties have the option of arbitration or judicial review. Third parties may, in certain specified circumstances, intervene in arbitration proceedings or file lawsuits.
Any person who 1) fails to notify the department of a release of a hazardous substance, or 2) fails to retain required documents is subject to criminal penalties, including a fine of up to $25,000 and/or imprisonment of up to three years, or five years for repeated violations.
The department may issue orders to enforce the requirements of this act. Civil penalties may be issued for up to $25,000 for violations of the chapter.
A lien will be imposed on the property of responsible parties who owe a debt to the state for cleanup costs. The lien will take priority over any other lien on the property.
An owner of nonresidential property that has been contaminated by hazardous substances must place a notice of this occurrence in the county auditor's records. This information must be supplied to any potential purchaser of the property.
If 100 or more persons petition the department, the agency may grant them money to assist in providing comments on decisions regarding response action plans, covenants not to sue, or certifications of completion. Grants may not exceed $50,000 for any site. The department must implement this provision in a manner that furthers public participation.
Actions taken under this chapter are exempt from the provisions of the State Environmental Policy Act and from permits required by other environmental laws.
The state Toxics Control Account is created. The account will consist of funds from penalties, costs recovered from responsible parties, and an excise tax of .55 percent on the first sale of hazardous substances in the state. The money may be used for 1) solid and hazardous waste planning, management, regulation, and enforcement; 2) hazardous waste cleanup; 3) technical assistance to local governments on solid and hazardous waste management practices; 4) financial assistance for local toxics control projects; and 5) water and health protection. A portion of the money will be placed in a reserve account to cover future costs of cleanup after a covenant not to sue is granted.
The tax applies to the wholesale value of the hazardous substance and is imposed when the distributor 1) brings hazardous substances into the state for sale; 2) manufactures hazardous substances for sale, or; 3) ships hazardous substances to be sold by retailers.
Credits are allowed when the hazardous substances are: 1) delivered outside the state; 2) returned to the person who paid the tax; and, 3) destroyed by a distributor in a manner approved by the department. Further, a credit for taxes paid on fuels exported from the state is allowed.
If a county or city is identified as a responsible party, it must create a solid waste disposal district or present to the Department of Ecology a comprehensive plan indicating the manner in which the city, town or county will fulfill its funding obligations. The current solid waste disposal district option to collect a business and occupation tax is expanded to apply equally to all businesses.
Local governments may apply for financial assistance from the toxics control account.
Appropriation: $30,768,000 to the Department of Ecology; $1,518,000 to the Department of Social and Health Services; and $821,000 to the Department of Community Development from the State Toxics Control Account.
Fiscal Note: available
Effective Date:July 1, 1987.
SUMMARY OF PROPOSED SENATE AMENDMENT:
Employees cannot make claims against employers for releases of hazardous substances under this act within a workplace. The normal application of fertilizer is not considered a release of a hazardous substance.
Persons who did not dispose of the hazardous substance, but owned the property since disposal are not liable.
Potentially responsible parties have a right of contribution among each other.
A remedial action plan is not required to precisely delineate the scope of action by specifying each substance that will be cleaned up.
If the Director rejects a plan or if any responsible party fails to submit a plan, after being notified and the violation is wilful, the responsible party is no longer liable for treble the Department's costs of cleanup. Treble damages are allowed for anyone who wilfully violates a Department of Ecology order or fails to comply with any elements of a plan.
A covenant not to sue shall be provided when cleanup levels have been established under the provisions of the act if the Director determines it is in the public interest.
The extent to which the technology used in the response action is demonstrated to be effective is added to the list of items the Director must determine are in the public interest when issuing a covenant not to sue. Where a plan is designed to provide a complete remedy, a full and unconditional covenant not to sue shall be issued at the time the response action certification of completion is issued, so long as the approved plan is amended to require additional appropriate response action.
After July 1, 1992 a covenant not to sue is not to be issued if the balance in the toxics reserve account falls below $20 million. Language requiring covenants not to sue to be effective only as long as the taxes in the act are in effect is removed.
Arbitration decision appeal rights are not allowed for intervenors in the arbitration process. Intervenors are subject to paying costs of the arbitration in an amount reflecting the degree to which each party failed to prevail in its position in the decision of the arbitrators.
Civil penalties limits are changed from $25,000 to $10,000.
Only persons with an interest in the property who are injured by the failure of a property owner to comply with property transfer provisions of the act can recover damages.
Significant quantities instead of reportable quantities of a hazardous waste which the owner knows to have occurred on the property in the last twenty years are required to be recorded when property transfer occurs.
Committing a fraud in respect to a proposed response action plan, in a request for a covenant not to sue or in an application for a certificate of completion will void a covenant not to sue. The injured person may recover treble damages.
Solid waste district provisions are deleted. Financing for local toxic control projects provisions are deleted. Appropriations to the Departments of Social and Health Services and Community Development are deleted.
The provision requiring $7 million a year be placed in the toxics control reserve from the toxic control account is reduced to $3 million. The appropriation made to the Department of Ecology is raised from $30,768,000 to $33,710,000. The hazardous substance tax is reduced from 55/100 of 1 percent to 31/100 of 1 percent.
Monies from the hazardous substances tax will no longer be used for the Department of Ecology hazardous waste regulatory program. A fee system is established to fund hazardous waste regulatory activities.
Senate Committee - Testified: Curt Johnson, Washington Land Title Association; Don Wessels, Washington Petroleum Marketers Association; James R. Butler, Ashland Oil, Inc.; Kirk Thomson, Boeing; Llewellyn Matthews, NW Pulp and Paper; Bruce Wishart, Sierra Club; Randy Ray, WOMA/OHI; Earl Tower, Department of Ecology; Kathleen Collins, AWC; Elizabeth Tabbitt, Washington Environmental Council; Larry Shannon, Washington Mortgage Bankers Association; Vern Lindskog, major oil companies