Settling Water-Based Superfund Liabilities -- A Toxic Brew

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In a poignant moment in Godfather III, Al Pacino’s character says: “Just when I thought I was out… they pull me back in”.  EPA's recent eye-popping announcement of a $366 million encore settlement by AVX with respect to the New Bedford Harbor Superfund Site re-enacts that moment, graphically illustrating the toxic combination of EPA’s sorry history of escalating remedy costs for water-based Superfund sites and Consent Decrees that contain cost-reopening provisions.

In 1992, AVX paid $66 million to resolve its New Bedford Harbor liability. Unfortunately AVX’s Consent Decree contained a cost reopener triggered if response costs exceeded $130.5 million. In the twenty years since AVX reached its initial settlement, response costs at the New Bedford Harbor site have sky-rocketed. As I noted in a recent post about water-based Superfund sites,   

the New Bedford Site involved manufacturing operations on the edge of a water body where large quantities of PCBs were allegedly discharged, causing the contamination of downstream sediments. The Site was added to the NPL in 1983, which spawned a decade of hotly contested litigation and two decades of a tortuous remedy selection process with numerous false starts. At the end of that process, EPA selected a remedy that neither treated nor destroyed the contaminated sediments. Instead, EPA selected the lowest of low tech remedies -- the dredging of 900,000 cubic yards of contaminated sediments to be shipped out-of-state for disposal in a landfill. After thirty years of working on the New Bedford Site, EPA recently reported that the dredging will likely take "40 years to complete at a cost of $1.2 billion.

Confronted with a remedy of over a billion dollars, EPA exercised the cost reopener against AVX, prompting the new $366 million settlement (which does not contain a cost reopener). 

EPA trumpets this settlement in its press release as a great success that will expedite the implementation of the Harbor remedy.  Obscured in that press release is the fact that EPA has taken thirty years to decide not to treat the PCBs in the New Bedford Harbor, spending many millions of dollars on a series of failed remedy selection processes before deciding to spend a billion dollars simply to relocate the PCBs from the Harbor into a landfill.

See video link here: http://www.youtube.com/watch?feature=player_embedded&v=UPw-3e_pzqU