ACG C.S.H.B. 2776 75(R)BILL ANALYSIS ENVIRONMENTAL REGULATION C.S.H.B. 2776 By: Jackson 4-10-97 Committee Report (Substituted) BACKGROUND The federal Superfund program was established to clean up abandoned hazardous waste sites that pose an imminent threat to public health and safety or the environment. The state Superfund program was created to address hazardous waste sites that pose a threat, but less severe than federal sites. The state program is funded by fees on the disposal of hazardous waste, the purchase of lead acid batteries, and the purchase of automotive oil. Because of concerns that program revenues may be inadequate to remediate the Superfund sites being evaluated, the TNRCC's Executive Director requested that a work group of industry and environmental stakeholders review the program's funding requirements and processes. After several meetings during 1996, the work group recommended changes in the program intended to expedite site cleanup and encourage the use of the Voluntary Cleanup Program when possible. CSHB 2776 includes the recommendations of that work group. The TNRCC and the work group expect these program revisions to result in cost savings to the program, although specific amounts cannot be quantified. The legislation also includes provisions consistent with a federal law enacted in September 1996, providing relief from liability for lenders and fiduciaries that have not been involved in the management of the site. PURPOSE C.S.H.B. 2776 will encourage the cleanup of sites contaminated by hazardous waste, and provide relief from liability for lenders and fiduciaries that did not participate in the management of the facility. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 361.133, Health and Safety Code, to allow early planned removal of waste at sites where the removal will prevent the site from becoming a state Superfund site, can be conducted without extensive investigation and planning, and will result in a significant cost reduction for the cleanup. Prohibits the use by the TNRCC of Fund 550 revenues to cleanup sites for which the TNRCC has other dedicated funds. Notice of the planned removal must be published in the Texas Register at least 30 days before the removal occurs. SECTION 2. Amends Section 361.136(i), Health and Safety Code, to exempt waste generated from remedial actions conducted by the EPA from paying the state hazardous waste remediation fee. SECTION 3. Amends Section 361.183(a), Health and Safety Code, to recognize an agreement under the Voluntary Cleanup Program as a viable alternative to listing a site on the state registry of Superfund sites. SECTION 4. Amends Subchapter F, Section 361, Health and Safety Code, by adding a new Section 361.1855, to allow early decisions regarding future land use. Before the site evaluation is completed, if a non-residential land use is proposed for a site that is zoned residential, the TNRCC must conduct a public meeting to receive public comment on the proposed land use. Notice of the meeting must be published in the Texas Register and the local newspaper at least 30 days before the meeting, and all public records regarding the site must be made available. The executive director will determine the land use after the public meeting. SECTION 5. Amends Section 361.187(b), Health and Safety Code, to reduce the time between the notice and the public meeting from 45 to 30 days. SECTION 6. Amends Section 361.188(a), Health and Safety Code, to specify that the final administrative order must include the selected land use, as well as the selected remedial action. SECTION 7. Amends Section 361.189(a), (b), and (c), Health and Safety Code, to allow the executive director to request that a site be delisted from the state registry. The commission's procedures to consider this request may include public meetings. Provides that a site that has entered the Voluntary Cleanup Program and has been delisted from the state registry be automatically reinstated to the state Superfund registry if the party fails to perform in the Voluntary Cleanup Program. SECTION 8. Amends Section 361.194(b) and (c), Health and Safety Code, to remove the requirement that the commission file a lien on state Superfund sites. The decision on whether to file a lien shall be based on the action that will result in the least cost to the state after cost recovery. SECTION 9. Amends Section 361.197(d), Health and Safety Code, to require the TNRCC to recover costs incurred in conducting a planned removal, spill, release or threatened release, and implementation of the Voluntary Cleanup Program. SECTION 10. Amends Section 361.200, Health and Safety Code, to allow the TNRCC to enter into settlement agreements that include covenants not to sue, mixed public and private funding, and partial settlements, as well as the de minimis settlements presently allowed. SECTION 11. Amends Section 361.271(e) and (f), Health and Safety Code, to state that a fiduciary's responsibility for solid waste is subject to Subchapter T, and a lender's responsibility for solid waste is subject to Subchapter U. SECTION 12. Amends Section 361.277, Health and Safety Code, to state that a settlement with the state releases the settling party from liability. The liability of nonsettling parties is not affected unless the settlement specifies otherwise, but the liability to the state is reduced by the amount of the settlement. SECTION 13. Amends Section 361.343, Health and Safety Code, to require the court, when apportioning costs for a site among responsible parties, to give credit for previous expenditures connected to a TNRCC-approved cleanup at the site. SECTION 14. Amends Section 361.344(a), Health and Safety Code, to state that a person that addresses a release or threatened release with commission approval may sue in district court to recover their costs. SECTION 15. Amends Chapter 361 by adding Subchapters T, U and V as follows: Subchapter T: _with the exception of the Petroleum Storage Tank Program, which has its own fiduciary liability provisions, the liability of a fiduciary is limited in certain situations for the release or threatened release of solid waste from a solid waste facility to the assets held in the fiduciary capacity; _in certain situations, does not limit the liability if the fiduciary's negligence caused or contributed to the release; _with the exception of the Petroleum Storage Tank Program, which has its own safe harbor provisions, provides a safe harbor in certain situations for the fiduciary for actions taken to clean up the site, comply with environmental laws, administer the site, or otherwise perform as a fiduciary for the site after the site was contaminated; and _defines "fiduciary", "fiduciary capacity", and "solid waste facility". Subchapter U: _defines applicable terms; _in certain situations, the lender is not liable for a removal or remedial action or subject to a fine or penalty if the lender did not participate in management of the site; _the lender is responsible for proper management of the site if the lender operates, directs the operation, or maintains the operation after foreclosure; and _states that the term "owner or operator" does not apply to a lender that does not participate in the management of the solid waste facility or forecloses on the facility, and closes the facility and cleans up the site after foreclosure. A lender is presumed to divest itself of a solid waste facility if the facility is listed for sale within 12 months of foreclosure. Subchapter V: _defines applicable terms; _provides for immunity from liability of innocent owners or operators if contamination is a result of contamination from off site if reasonable access to the site is provided for remediation; _provides for an innocent owner or operator to obtain a certificate confirming innocent status; and _provides that this subchapter will not limit the rights of an innocent owner or operator to pursue any current remedy in law or equity. SECTION 16. Amends Subchapter C, Section 2155, Government Code, by adding a new Section 2155.144 to delegate to the TNRCC purchasing functions related to the State Superfund Program. SECTION 17. Amends Section 2166.003(a), Government Code, to add the State Superfund Program to the list of exemptions regarding building construction and acquisition. SECTION 18. Amends Subchapter A, Chapter 2253.002, Government Code, to specify that a public works contract does not include contract entered into under the State Superfund Program. SECTION 19. Amends Section 26.265, Water Code by adding (h), (i) and (j) to state that a settlement with the state releases the settling party from liability. The liability of nonsettling parties is not affected unless the settlement specifies otherwise, but the liability to the state is reduced by the amount of the settlement. SECTION 20. Effective date: September 1, 1997 SECTION 21. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE CSHB 2776 revises and rearranges the language of the original bill, in some cases makes the same changes in different sections of the statute. In addition the following changes are made: Section 361.136(i) of the substitute replaces the term "public funds" with "money." Section 361.194(c) of the substitute replaces the term "shall" with "must." The substitute adds a new Chapter 361.702(f) to release from liability those owners or operators of land next to contaminated property if that owner or operator did not contribute to the contamination. SECTION 16 of the substitute is a new section, delegating to the TNRCC from the General Services Commission those purchasing functions related to the State Superfund Program. SECTION 17 of the substitute is a new section, stating that the State Superfund Program is exempt from State building and construction requirements. SECTION 18 of the substitute is a new section, stating that the State Superfund Program is exempt from State public works contract requirements.