UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, DC 20460
August 15, 2001
The Honorable Robert C. Smith
United States Senate
Washington, DC 20510
Dear Senator Smith,
Thank you for your letter dated June 29, 2001, in which you ask the
U.S. Environmental Protection Agency (EPA) to grant parties at the Beede
Waste Oil Superfund site in Plaistow, New Hampshire, an extension to the
60 day deadline for response to the general notice of liability. I
appreciate your concern that all parties have adequate time to make these
important decisions.
While we intend on keeping the 60 day and the August 20, 2001,
deadlines, please let me clarify how EPA's approach is intended to
work. By way of background, there are two categories of parties from
whom EPA requested a response in August: (1) small de minimis
generator parties, who must decide whether or not to accept EPA's
settlement offer by August 20, 2001; and large de minimis
and major generator parties, who were asked to submit a brief,
formal response to the general notice letter within 60 days of receipt of
that letter indicating whether they plan to participate in future
negotiations, but to whom no settlement offer was made. Enclosed is
a more detailed summary of the different requests made by EPA.
The 850 smaller generators in the first category do not need to form
into settlement groups in responding to EPA's settlement offer. This
settlement allows parties to resolve their liability to EPA individually,
thereby saving these parties the transaction costs involved in grouping
together. Furthermore, the settlement offer contains a complete list
of early de minimis potentially responsible party (PRP) groups
with volume and payment amounts to demonstrate that all parties will pay
their fair share based solely on relative contribution. If these
parties choose to question the waste quantity attributable to them or are
concerned about their ability to pay the settlement amount, they should
notify the Agency by the August 20, 2001, deadline. The review of
these claims will not begin until sometime after August 20, 2001. If
a legitimate claim is made, EPA will attempt not to disadvantage these
parties in a future de minimis settlement, although the terms of
a future settlement cannot be guaranteed.
Many small generator de minimis parties will be disadvantaged
if an extension to the August 20, 2001, offer were to be granted.
EPA's primary intent in providing this immediate settlement opportunity to
small generators of hazardous waste is to provide a chance for them to
equitably resolve their legal responsibility for the clean up of the Beede
site, while minimizing their overall financial exposure. For this
reason and because the settlement agreement (referred to as an
Administrative Order on Consent) was structured to be finalized prior to
the end of the calendar year and before final selection of the Site clean
up remedy, we cannot extend this settlement offer beyond August 20, 2001,
without causing negative tax consequences and increased transaction costs
for all early de minimis settlors as well as raising fairness
concerns for those parties who have already accepted their settlement
offers and paid their settlement amounts. Specifically, if this
settlement is not finalized by December 31, 2001, under the tax laws, each
settlor will be required to pay taxes on the interest earned on its
settlement share, even though these parties will not be receiving this
interest payment.
With regard to the 1200 large de minimis and 50 major
generator parties, EPA does not expect that parties will
have organized into larger PRP groups or formed steering committees within
the 60 day time-frame. The letters sent in early June of this year
to the large and major generators did not contain a
specific settlement offer. At this point, parties should start to
prepare for future negotiations. There is no deadline for organizing
such groups at this time, but grouping is necessary since, as a practical
matter, EPA cannot negotiate individually with 1,200 parties.
Grouping also allows parties to pool their resources.
EPA will not refuse information submitted after the 60 day time
period. There is no penalty for failing to respond. We simply
ask that all parties respond with a letter as soon as possible, and
preferably within the 60 day time period, to ensure that we know which
parties would like to participate in future negotiations and to make sure
that we have the proper contacts for future mailings and updates.
In asking for a 60 day response from the large de minimis
generators, major generators, owner/operators, and transporters, EPA is
trying to determine which parties are interested in participating in
future settlement negotiations to the Beede site. We also need to
update our information relative to the appropriate contacts for the
PRPs. While parties are welcome to raise other issues at this
time, like waste quantity questions or relevant defenses, it is not
essential that they do so within the 60 day time frame.
I want to re-emphasize that parties who chose not to participate in the
early settlement opportunity or respond within the 60 day time period will
not be treated as recalcitrants.
Again, thank you for sharing your concerns about the settlement process
associated with the Beede Superfund site. If you have further
questions or concerns, please contact me or have your staff contact Randy
Deitz in the Office of Congressional and Intergovernmental Relations at
(202) 564-3683.
Sincerely yours,
[signed]
Christine Todd Whitman
Enclosure
ENCLOSURE
U.S. Environmental Protection Agency
Beede Waste Oil Superfund Site
Background on Response Requests
EPA issued a settlement offer to approximately 850 parties who each
sent between 275 and 1,000 gallons of waste to the Beede site, called
"small de minimis generator parties." This settlement
opportunity is called the "small de minimis settlement offer,"
and it was included in each Superfund general notice of liability letter
to these parties. Settlement amounts range from about $1,500 to just
under $6,000 for the small de minimis generator parties to settle
all claims with EPA, resolve their Superfund liability, and obtain
protection from third party lawsuits. This offer closes on August
20, 2001, which is about 70 to 75 days from the time most parties received
it.
In early June of this year, EPA also issued approximately 1,200
notice of Superfund liability letters to "large de minimis
generator parties," who contributed more than 1,000 gallons but less than
40,000 gallons of hazardous waste to the Beede site. These letters
did not contain a specific settlement offer.
Instead, these large de minimis generator parties were asked
to submit a written response to the Agency within 60 days of their receipt
of the letter. EPA expects that these parties will form into large
potentially responsible party (PRP) group(s), negotiate with the Agency
and other PRPs, and have the opportunity to participate in a future de
minimis settlement.
EPA also issued general notice letters to approximately 50 "major"
generator parties, those who contributed 40,000 gallons of waste or more
to the Beede site. These letters did not contain a
settlement offer either, and, in fact, this group is not only expected to
finance a fair share of the clean up, but also to perform
the selected remedy. These major generator parties were asked
to submit a written response to the Agency within 60 days of their
receipt of the letter. EPA expects that these parties will also
form into large PRP group(s), negotiate with the Agency and other PRPs,
and have the opportunity to enter into a final settlement agreement in the
future for both the financing and actual clean up of the Beede site.
Finally, a small number of parties identified as owner/operators and
transporters under the Superfund law were also sent general notice letters
and asked to respond to the Agency within 60 days of their receipt of the
letter.
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