Where We Go from Here: CERCLA and the Bonita Peak Mining District

By Olivia Wheeling*

In 2015, the Southwestern United States was represented nationally by a photo of kayakers paddling in water that looked like pumpkin soup.[1] That year, an EPA contractor, sent to the Gold King Mine to evaluate water levels in advance of the installation of two hydraulic bulkheads at other nearby mines, triggered the release of millions of gallons of toxic wastewater into Cement Creek and the Animas River.[2] The waste released from the mine contained high levels of lead and arsenic, which flowed through southwest Colorado and New Mexico.[3] The public and legal backlash was swift, putting the EPA on the defensive and resulting in multiple lawsuits filed against the EPA and the state of Colorado.[4] The long-term effects of this contamination are still being measured, but this type of pollution is hardly foreign to the residents of the area. In fact, toxic wastewater turns the Animas River the same sickly yellow-orange color every time it rains in the mountains and water from Cement Creek has not been safe to drink since 1876, not to mention the constant small-scale pollution that occurs as natural rivulets flow over the mine tailings and into larger waterways.[5]

After the release, political pressure mounted to designate the mines as a Superfund site, by placing them on the National Priorities List (“NPL”) – a list of the most polluted sites in the United States.[6] The abandoned hard rock mines around Silverton, Colorado had been proposed for a NPL” listing before, but community concern for a listing’s effect on the critical tourism industry had previously outweighed calls for putting the Bonita Peak Mining District (“BPMD”) on the NPL.[7] Due to the effects of the release, the BPMD was listed on the NPL as a General Superfund site in 2016.[8]

Once a site has been added to the NPL, the EPA begins the remediation and settlement process. First, scientists study the site to determine which remediation strategy will be selected.[9] Once the study has been completed and the remediation plan selected, the EPA begins the search for Potentially Responsible Parties (“PRPs”).[10] The definition of a PRP in the Comprehensive Environmental Response, Compensation, and Liability Act of 1990 (“CERCLA”) is intentionally broad, and encompasses not only those that currently own or operate a specific site, but also historical owners and those tasked with the transportation or disposal of hazardous materials.[11] The EPA then categorizes these PRPs based on whether the EPA will name them in lawsuits to facilitate remediation or not.[12] Pre-litigation negotiations occur to bolster future lawsuits, with emphasis placed on getting statements of responsibility from PRPs and gathering documentation that can be used during litigation and settlement.[13] PRPs are then tasked with cleaning up the site at their own expense.[14] Only after they have successfully settled their CERCLA liability can PRPs begin their own lawsuits against other PRPs for contribution – an important tool for the named PRPs to recoup their cleanup costs.[15]

The litigation-centric model of Superfund site remediation has been followed since the early days of CERCLA because it provides the EPA with a strong settlement negotiation position before litigation commences, because it allows the EPA to shift the financial burden of cleanup to private parties rather than stretching the already-thin Superfund,[16] and because it holds the PRPs publicly to account for their pollution. However, there are two areas in which this model does not perform as well as it might: (1) it historically has been unable to recover the full amount settled for when the PRP is found to be insolvent;[17] and (2) it incentivizes PRPs to avoid their own cleanup efforts for as long as possible, because those efforts may lead to that PRP having to foot the entire remediation bill itself before it can sue for contribution from other PRPs.[18]

An alternative, negotiation-centric model was utilized after CERCLA was originally passed in 1980.[19] In this process, PRPs, community leaders, and the EPA would enter structured negotiations to decide on the payment process for a remediation plan. This approach suffered from an optics problem, stemming from the view that negotiation without litigation and settlement allowed big polluters to escape the full measure of their responsibility for the contamination.[20] In addition, the negotiation process forced the EPA to sacrifice some of its strongest litigation positions in order to successfully complete the negotiations, which made any subsequent lawsuits more difficult.[21]

However, this model is not without its benefits. Under this approach, a study would still be undertaken and remediation plan decided upon, and PRPs would still be named. However, these named PRPs would then become parties to structured negotiations. The EPA and leaders from the surrounding community (e.g. county commissioners, environmental interest groups, and other political figures) also enter these negotiations, which are led by a mediator with expert knowledge of the specific issues at hand.[22] These parties then negotiate for how the work and costs of the remediation plan will be allocated, and the end product is a mutually-agreed upon plan to remediate the site.[23] To encourage PRPs to fully engage with the negotiation process, the EPA promises the PRPs in attendance to pursue non-participant PRPs for any additional costs of the remediation before suing the participating PRPs for the difference in cost between what was negotiated and what the effort actually cost.[24] The focus of negotiation is still on private-led cleanup efforts, but a negotiation-centric model has the potential to encourage more PRPs to participate, rather than actively avoid being named.

The BPMD is a Superfund site that may suggest itself to a negotiation- rather than litigation-centric approach. First, the mines have been inactive for several years and the mine owners are likely to be either actually or strategically insolvent – reducing the chances that the EPA will be able to recover the full cost of cleanup from them, even using a litigation-centric approach.[25] In addition, the cleanup effort will be enormously complicated, with complex connections between the mines themselves and between the mines and the underlying mountain structure and waterways making a clear strategy difficult to discern.[26] Treating this ecosystem for the decades of consistent pollution may warrant the participation of local experts in the remediation plan process from beginning to end, including during the PRP cleanup cost allocation procedure. Finally, the EPA is already entering this situation in a significantly weaker position than normal, considering the negative local attitude toward it during the Gold King Mine release and the historically positive public view of the BPMD from a tourism and local economy perspective.[27] Using a negotiation-centric approach may improve local opinion of the cleanup efforts by fostering greater community engagement with the remediation process.

Of course, this methodology still has some problems. Entering into negotiations with mine owners who allowed consistent acidic wastewater pollution to enter downstream waterways on a daily basis may, once again, look like the EPA is letting these polluters off easy by not immediately pursuing lawsuits against them. In addition, the mine owners may be found insolvent during or after negotiations and could then avoid the full scope of their financial liability. Finally, finding consistent involvement in long-term structured negotiations may prove difficult because of waning community interest, local elections, and limited EPA personnel budgets. Even so, at least considering a negotiation-centric approach to this admittedly-unique situation[28] is warranted because it could offer a tailored solution to a particularly difficult pollution problem.

*Olivia Wheeling is a Junior Editor on MJEAL. She can be reached via email at wheeling@umich.edu.

The views and opinions expressed in this blog are those of the authors only and do not reflect the official policy or position of the Michigan Journal of Environmental and Administrative Law or the University of Michigan.

[1] Daniel Victor, Wastewater Spill in Colorado Turns a River Yellow, N.Y. Times (Aug. 7, 2015), https://www.nytimes.com/2015/08/08/us/wastewater-spill-in-colorado-turns-a-river-yellow.html.

[2] Id.

[3] Dan Elliot & Colleen Slevin, EPA: No word yet on health risk from Colorado mine spill, A.P. News (Aug. 8, 2015), https://apnews.com/e01d7fbc82a744e1907a2ebada1593fe/orange-waste-colorado-mine-creeps-toward-new-mexico.

[4] Jesse Paul, New Mexico congressional delegation worries state, Navajo Nation will be left out of EPA’s new Gold King promises, Denv. Post (Aug. 7, 2017), https://www.denverpost.com/2017/08/07/new-mexico-congressional-delegation-worries-state-navajo-nation-left-out-epas-gold-king-promises/.

[5] Sarah Kaplan, What the EPA was doing when it sent yellow sludge spilling into a Colorado creek, Wash. Post (Aug. 10, 2015), https://www.washingtonpost.com/news/morning-mix/wp/2015/08/10/what-the-epa-was-doing-when-it-sent-yellow-sludge-spilling-into-a-colorado-creek/?utm_term=.5cb2ad71dc25.

[6] See, e.g.  Letter from Colo. Gov. John Hickenlooper to the EPA (Feb. 29, 2016) (https://www.epa.gov/goldkingmine/colorado-governor-john-hickenloopers-letter-support-bonita-peak-mining-district-npl) (expressing the Governor’s support for listing Bonita Peak as an NPL site).

[7] Id.

[8] National Priorities List, 81 Fed. Reg. 175, 62401 (Sept. 9, 2016).

[9] Scott E. Blair, Toxic Assets: The EPA’s Settlement of CERCLA Claims in Bankruptcy, 86 N.Y.U.L. Rev. 1941, 1945 (2011).

[10] Id. at 1946-48.

[11] 42 U.S.C. § 9607

[12] Edward E. Reich, Model Litigation Report for CERCLA Sections 106 and 107 and RCRA Section 7003, 14-15, http://bit.ly/2mWBrZH.

[13] Frederick Anderson, Negotiation and Informal Agency Action: The Case of Superfund. 1985 Duke L.J. 261, 294-95 (1985); See also, EPA, Guidance: CERCLA Settlement Policy (Interim), (last visited Nov. 11, 2017), https://www.epa.gov/enforcement/guidance-cercla-settlement-policy-interim.

[14] Id. at 270.

[15] Stephen F. Soltis, Settlements as an Incentive to Procure Hazardous Waste Site Cleanup: The Third Circuit and a Broad Reading of CERCLA § 113(F)(3)(B), 7 Ky. J. Equine Agric. & Nat. Resources L. 143, 143 (2014-2015).

[16] Manas Kumar, Stimulating the Superfund: How to Reinvigorate CERCLA, Mich. J. of Envtl. and Admin. L. (Sept. 11, 2017), http://www.mjeal-online.org/stimulating-the-superfund-how-to-reinvigorate-cercla/#_edn3.

[17] Blair, supra note 9, at 1959-61.

[18] Bart Lounsbury, Digging Out of the Holes We’ve Made: Hardrock Mining, Good Samaritans, and the Need for Comprehensive Action, 32 Harv. Envtl. L. Rev. 149, 168 (2008).

[19]Anderson, supra note 13, at 276.

[20] Id. at 284.

[21] Id. at 286.

[22] Id. at 350-56.

[23] Id. at 371.

[24] Anderson, supra note 13, at 358.

[25] Blair, supra note 17, at 1959-61.

[26] Bruce Finley, EPA crews working on Gold King cleanup find elevated lead threatening birds, animals and, potentially, people, Denv. Post (Oct. 29, 2017), http://www.denverpost.com/2017/10/19/gold-king-mine-cleanup-epa-lead-spreading-to-animals-people/.

[27] Kaplan, supra note 5.

[28] Bruce Finley, Regional EPA Director Calls Wastewater Spill in Animas River ‘Tragic’, Denv. Post (Aug. 7, 2015), http://www.denverpost.com/2015/08/07/regional-epa-director-calls-wastewater-spill-in-animas-river-tragic/.

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