1-1 By: Jackson (Senate Sponsor - Brown) H.B. No. 2776
1-2 (In the Senate - Received from the House May 9, 1997;
1-3 May 12, 1997, read first time and referred to Committee on Natural
1-4 Resources; May 16, 1997, reported adversely, with favorable
1-5 Committee Substitute by the following vote: Yeas 6, Nays 0;
1-6 May 16, 1997, sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR H.B. No. 2776 By: Brown
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to the regulation of state superfund sites.
1-11 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-12 SECTION 1. Section 361.133, Health and Safety Code, is
1-13 amended by adding Subsections (g)-(i) to read as follows:
1-14 (g) Notwithstanding Subsection (c), the executive director
1-15 may use money in the fund, including interest credited under
1-16 Subsection (b)(4), for expenses concerning a cleanup or removal of
1-17 a spill, release, or potential threat of release of a hazardous
1-18 substance if the site is eligible for listing under Subchapter F,
1-19 proposed for listing under Subchapter F, or listed under the state
1-20 registry before September 1, 1989, and:
1-21 (1) immediate action is appropriate to protect human
1-22 health or the environment and there is a substantial likelihood
1-23 that the cleanup or removal will prevent the site from needing to
1-24 be listed under Subchapter F; or
1-25 (2) a cleanup or removal:
1-26 (A) can be completed without extensive
1-27 investigation and planning; and
1-28 (B) will achieve a significant cost reduction
1-29 for the site.
1-30 (h) If the commission collects a fee that is deposited in a
1-31 dedicated fund established for the purpose of cleaning up a
1-32 facility, tank, or site described by this subsection, the
1-33 commission may not use money in the hazardous and solid waste
1-34 remediation fee fund to clean up a:
1-35 (1) waste tire recycling facility;
1-36 (2) municipal solid waste facility;
1-37 (3) petroleum storage tank; or
1-38 (4) used oil collection and recycling site that
1-39 received used oil after August 31, 1995.
1-40 (i) Not later than the 31st day before the date the
1-41 commission begins a cleanup or removal under Subsection (g), the
1-42 commission must publish notice of its intent to perform the cleanup
1-43 or removal in the Texas Register.
1-44 SECTION 2. Section 361.136(i), Health and Safety Code, is
1-45 amended to read as follows:
1-46 (i) The storage, processing, or disposal of industrial solid
1-47 wastes or hazardous wastes generated in a removal or remedial
1-48 action accomplished through the expenditure of money [public funds]
1-49 from the hazardous and solid waste remediation fee fund or
1-50 generated in a removal or remedial action in this state conducted
1-51 by the United States Environmental Protection Agency shall be
1-52 exempt from the assessment of a waste management fee under this
1-53 section.
1-54 SECTION 3. Section 361.183(a), Health and Safety Code, is
1-55 amended to read as follows:
1-56 (a) Before [the] listing [of] a facility on the state
1-57 registry, the executive director shall determine whether the
1-58 potential endangerment to public health and safety or the
1-59 environment at the facility can be resolved by:
1-60 (1) the present owner or operator under the federal
1-61 Resource Conservation and Recovery Act of 1976 (42 U.S.C. Section
1-62 6901);
1-63 (2) [or by] some or all of the potentially responsible
1-64 parties identified in Subchapter I, under an agreed administrative
2-1 order issued by the commission; or
2-2 (3) an agreement under Subchapter S, as added by
2-3 Chapter 986, Acts of the 74th Legislature, Regular Session, 1995.
2-4 SECTION 4. Subchapter F, Chapter 361, Health and Safety
2-5 Code, is amended by adding Section 361.1855 to read as follows:
2-6 Sec. 361.1855. PROPOSAL OF LAND USE OTHER THAN RESIDENTIAL.
2-7 (a) The executive director shall hold a public meeting to obtain
2-8 public input and information regarding the appropriate use of land
2-9 on which a facility is located that is the subject of a remedial
2-10 investigation/feasibility study if:
2-11 (1) a land use other than residential is proposed as
2-12 appropriate for the land by:
2-13 (A) the executive director; or
2-14 (B) a potentially responsible party who has
2-15 entered into an agreed order with the commission;
2-16 (2) the proposal is made before the study is
2-17 completed; and
2-18 (3) a local government has not zoned the land as
2-19 residential only.
2-20 (b) Any interested person may comment at the meeting.
2-21 (c) The meeting is legislative in nature and not a contested
2-22 case hearing under Chapter 2001, Government Code.
2-23 (d) Not later than the 31st day before the date of the
2-24 meeting, the commission shall:
2-25 (1) publish notice of the meeting in the Texas
2-26 Register and in a newspaper of general circulation in the county in
2-27 which the facility is located;
2-28 (2) mail notice of the meeting to each potentially
2-29 responsible party by certified mail, return receipt requested, at
2-30 the party's most recent address as shown on the records of the
2-31 commission; and
2-32 (3) make the commission's records regarding the
2-33 facility available to any interested person.
2-34 (e) The notice shall:
2-35 (1) state the date, time, and place of the meeting;
2-36 and
2-37 (2) provide information regarding the proposed land
2-38 use.
2-39 (f) The failure of a potentially responsible party to
2-40 receive a notice under this section does not affect the
2-41 responsibilities, duties, or liabilities of the party.
2-42 (g) After the meeting, the executive director shall select
2-43 the appropriate land use for purposes of selecting a proposed
2-44 remedial action.
2-45 SECTION 5. Section 361.187(b), Health and Safety Code, is
2-46 amended to read as follows:
2-47 (b) The commission shall publish notice of the meeting in
2-48 the Texas Register and in a newspaper of general circulation in the
2-49 county in which the facility is located at least 30 [45] days
2-50 before the date of the public meeting. The notice shall provide
2-51 information regarding the proposed remedial action and the date,
2-52 time, and place of the meeting. The commission shall also mail the
2-53 same information to each potentially responsible party by certified
2-54 mail, return receipt requested, at the party's last known address
2-55 at least 30 [45] days before the public meeting. Contemporaneously
2-56 with the issuance of notice of the public meeting, the executive
2-57 director shall make available to all interested parties the public
2-58 records the executive director has regarding the facility. For
2-59 purposes of providing this information, the executive director
2-60 shall provide a brief summary of those public records and make
2-61 those public records available for inspection and copying during
2-62 regular business hours. Nonreceipt of any notice mailed to a
2-63 potentially responsible party under this section does not affect
2-64 the responsibilities, duties, or liabilities imposed on the party.
2-65 SECTION 6. Section 361.188(a), Health and Safety Code, is
2-66 amended to read as follows:
2-67 (a) After consideration of all good faith offers to perform
2-68 a remedial action, the commission shall issue a final
2-69 administrative order that must:
3-1 (1) list the facility on the state registry, thus
3-2 determining that the facility poses an imminent and substantial
3-3 endangerment to public health and safety or the environment;
3-4 (2) specify the appropriate land use for purposes of
3-5 selecting the appropriate remedial action;
3-6 (3) specify the selected remedial action;
3-7 (4) [(3)] list the parties determined to be
3-8 responsible for remediating the facility;
3-9 (5) [(4)] make findings of fact describing actions
3-10 voluntarily undertaken by responsible parties;
3-11 (6) [(5)] order the responsible parties to remediate
3-12 the facility and, if appropriate, reimburse the hazardous waste
3-13 disposal fee fund for remedial investigation/feasibility study and
3-14 remediation costs;
3-15 (7) [(6)] establish a schedule for completion of the
3-16 remedial action;
3-17 (8) [(7)] state any determination of divisibility of
3-18 responsible party liability; and
3-19 (9) [(8)] give notice of the duties and restrictions
3-20 imposed by Section 361.190.
3-21 SECTION 7. Section 361.189, Health and Safety Code, is
3-22 amended to read as follows:
3-23 Sec. 361.189. Deletions from Registry. (a) The executive
3-24 director or an [Any] owner or operator or other named responsible
3-25 party of a facility listed or to be listed on the state registry
3-26 may request the commission to delete the facility from the state
3-27 registry, modify the facility's priority within the state registry,
3-28 or modify any information regarding the facility by submitting a
3-29 written statement setting forth the grounds of the request in the
3-30 form the commission may by rule require.
3-31 (b) The commission by rule shall establish procedures,
3-32 including public meetings [hearings], for review of requests
3-33 submitted under this section.
3-34 (c) If the commission deletes a facility from the state
3-35 registry because the cleanup of the facility is being addressed
3-36 under Subchapter S, as added by Chapter 986, Acts of the 74th
3-37 Legislature, Regular Session, 1995, the facility automatically
3-38 reverts to the status the facility had immediately before the
3-39 facility was deleted from the registry on the date of the executive
3-40 director's determination that the cleanup of the facility is not
3-41 being addressed adequately. A public meeting is not required for
3-42 an action under this subsection.
3-43 SECTION 8. Sections 361.194(b) and (c), Health and Safety
3-44 Code, are amended to read as follows:
3-45 (b) The lien imposed by this section arises and attaches to
3-46 the real property subject to or affected by a remedial action at
3-47 the time an affidavit is recorded and indexed in accordance with
3-48 this section in the county in which the real property is located.
3-49 The executive director shall determine whether to prepare an
3-50 affidavit. In making the determination, the executive director
3-51 shall proceed in the manner that the executive director determines
3-52 will most likely result in the least overall costs to the state
3-53 after any cost recovery action. For the purpose of determining
3-54 rights of all affected parties, the lien does not relate back to a
3-55 time before the date on which the affidavit is recorded, which date
3-56 is the lien inception date. The lien continues until the liability
3-57 for the costs is satisfied or becomes unenforceable through
3-58 operation of law.
3-59 (c) An authorized representative of the commission must
3-60 [shall] execute the affidavit. The affidavit must show:
3-61 (1) the names and addresses of the persons liable for
3-62 the costs;
3-63 (2) a description of the real property that is subject
3-64 to or affected by the remediation action for the costs or claims;
3-65 and
3-66 (3) the amount of the costs and the balance due.
3-67 SECTION 9. Section 361.197, Health and Safety Code, is
3-68 amended by adding Subsection (d) to read as follows:
3-69 (d) The commission shall file a cost recovery action against
4-1 each responsible party for the total costs of an action taken under
4-2 Section 361.133(c)(1), (2), (3), (5), or (6) or Section 361.133(g).
4-3 SECTION 10. Section 361.200, Health and Safety Code, is
4-4 amended to read as follows:
4-5 Sec. 361.200. [DE MINIMIS] SETTLEMENT. The commission shall
4-6 assess and by rule may develop and implement a [de minimis]
4-7 settlement program. Under the program, the commission shall
4-8 consider the advantages of developing a final settlement with
4-9 potentially responsible parties that are responsible for [only a
4-10 minor portion of the] response costs at a facility because of [the]
4-11 hazardous substances. The settlement program may include:
4-12 (1) de minimis settlements;
4-13 (2) covenants not to sue;
4-14 (3) mixed funding; and
4-15 (4) partial settlements [the party is responsible for
4-16 are minimal in amount or in hazardous effect by comparison with the
4-17 hazardous substances attributable to other parties].
4-18 SECTION 11. Section 361.271, Health and Safety Code, is
4-19 amended by adding Subsections (e) and (f) to read as follows:
4-20 (e) A fiduciary's responsibility for solid waste is subject
4-21 to Subchapter T.
4-22 (f) A lender's responsibility for solid waste is subject to
4-23 Subchapter U.
4-24 SECTION 12. Section 361.277, Health and Safety Code, is
4-25 amended to read as follows:
4-26 Sec. 361.277. EFFECT OF SETTLEMENT AGREEMENT WITH STATE
4-27 [JUDGMENT BY STATE AGAINST NONSETTLING PARTY; ACTION FOR
4-28 CONTRIBUTION BY NONSETTLING PARTY]. (a) If fewer than all of the
4-29 persons identified as liable under this subchapter agree with the
4-30 state to take remedial action to abate an actual or threatened
4-31 release of solid waste that is an imminent and substantial
4-32 endangerment to the public health and safety or the environment
4-33 under an administrative order issued under Section 361.272 or an
4-34 action filed by the state under this subchapter, the state may seek
4-35 a judgment against a nonsettling person for the total amount of the
4-36 cost of the remedial action minus that amount the settling persons
4-37 agree to pay or spend.
4-38 (b) A person who enters a settlement agreement with the
4-39 state that resolves all liability of the person to the state for a
4-40 site subject to Subchapter F is released from liability to a person
4-41 described by Section 361.344(a) for cost recovery, contribution, or
4-42 indemnity under Section 361.344 regarding a matter addressed in the
4-43 settlement agreement.
4-44 (c) A settlement agreement does not discharge the liability
4-45 of a nonsettling person to the state unless the agreement provides
4-46 otherwise.
4-47 (d) Notwithstanding Subsection (c), a settlement agreement
4-48 reduces the potential liability to the state of the nonsettling
4-49 persons by the amount of the settlement [In an action for
4-50 contribution brought by a nonsettling person against a settling
4-51 person, the nonsettling person has the burden to prove that the
4-52 amount of cleanup costs that a settling person agreed to pay under
4-53 an agreement with the state is unreasonable considering the factors
4-54 under Section 361.343 and the need to undertake timely cleanup
4-55 action concerning the release or threatened release].
4-56 SECTION 13. Section 361.343, Health and Safety Code, is
4-57 amended by amending Subsection (b) and adding Subsection (c) to
4-58 read as follows:
4-59 (b) In apportioning costs under Subsection (a), the court
4-60 shall credit against a responsible party's share of the costs of
4-61 eliminating a release or threatened release of solid waste the
4-62 party's expenditures related to the cleanup at issue if the
4-63 commission or the executive director approves the cleanup. If the
4-64 expenditures were made before the property was proposed to be
4-65 listed on the state registry and the commission or the executive
4-66 director approves the cleanup, the court shall also reduce in an
4-67 equitable and just manner the party's proportionate share of the
4-68 costs.
4-69 (c) The apportionment of costs only adjusts the rights of
5-1 parties identified by Section 361.271 and does not affect a
5-2 person's liability to the state.
5-3 SECTION 14. Section 361.344(a), Health and Safety Code, is
5-4 amended to read as follows:
5-5 (a) A person [subject to a court injunction or an
5-6 administrative order issued under this chapter, or a third person
5-7 identified by Section 361.192(c)] who conducts a removal or
5-8 remedial action that is approved by the commission and is necessary
5-9 to address [acts to eliminate] a release or threatened release[,
5-10 in addition to having the right to file an action for contribution
5-11 or indemnity, or both, in an appeal proceeding or in an action
5-12 brought by the attorney general,] may bring suit in a district
5-13 court to recover the reasonable and necessary costs of that action
5-14 [incurred to eliminate the release or threatened release] and other
5-15 costs as the court, in its discretion, considers reasonable. This
5-16 right is in addition to the right to file an action for
5-17 contribution, indemnity, or both in an appeal proceeding or in an
5-18 action brought by the attorney general.
5-19 SECTION 15. Chapter 361, Health and Safety Code, is amended
5-20 by adding Subchapters T, U, and V to read as follows:
5-21 SUBCHAPTER T. FIDUCIARY LIABILITY
5-22 Sec. 361.651. DEFINITIONS. In this subchapter:
5-23 (1) "Fiduciary":
5-24 (A) means a person acting for the benefit of
5-25 another party as a bona fide:
5-26 (i) trustee;
5-27 (ii) executor;
5-28 (iii) administrator;
5-29 (iv) custodian;
5-30 (v) guardian of an estate or guardian ad
5-31 litem;
5-32 (vi) receiver;
5-33 (vii) conservator;
5-34 (viii) committee of the estate of an
5-35 incapacitated person;
5-36 (ix) personal representative;
5-37 (x) trustee, including a successor to a
5-38 trustee, under an indenture agreement, trust agreement, lease, or
5-39 similar financing agreement, for debt securities, certificates of
5-40 interest or certificates of participation in debt securities, or
5-41 other forms of indebtedness as to which the trustee is not, in the
5-42 capacity of trustee, the lender; or
5-43 (xi) representative in any other capacity
5-44 that the commission, after providing public notice, determines to
5-45 be similar to the capacities described in Subparagraphs (i)-(x);
5-46 and
5-47 (B) does not include:
5-48 (i) a person that is acting as a fiduciary
5-49 with respect to a trust or other fiduciary estate that was
5-50 organized for the primary purpose of, or is engaged in, actively
5-51 carrying on a trade or business for profit, unless the trust or
5-52 other fiduciary estate was created as part of, or to facilitate,
5-53 one or more estate plans or because of the incapacity of a natural
5-54 person; or
5-55 (ii) a person that acquires ownership or
5-56 control of a solid waste facility with the objective purpose of
5-57 avoiding liability of the person or of any other person.
5-58 (2) "Fiduciary capacity" means the capacity of a
5-59 person in holding title to a solid waste facility or otherwise
5-60 having control of or an interest in the solid waste facility
5-61 pursuant to the exercise of the responsibilities of the person as a
5-62 fiduciary.
5-63 (3) "Solid waste facility":
5-64 (A) means:
5-65 (i) all contiguous land, including
5-66 structures, appurtenances, and other improvements on the land, used
5-67 for processing, storing, or disposing of solid waste, including a
5-68 publicly or privately owned solid waste facility consisting of
5-69 several processing, storage, or disposal operational units such as
6-1 one or more landfills, surface impoundments, or a combination of
6-2 units; and
6-3 (ii) any building, structure,
6-4 installation, equipment, pipe, or pipeline, including any pipe into
6-5 a sewer or publicly owned treatment works, well, pit, pond, lagoon,
6-6 impoundment, ditch, landfill, storage container, motor vehicle,
6-7 rolling stock, or aircraft, or any site or area where a hazardous
6-8 substance has been deposited, stored, disposed of, placed, or
6-9 otherwise come to be located; and
6-10 (B) does not include a:
6-11 (i) consumer product in consumer use; or
6-12 (ii) vessel.
6-13 Sec. 361.652. LIABILITY OF FIDUCIARIES. (a) Except as
6-14 otherwise provided by Subchapter I, Chapter 26, Water Code, or
6-15 rules adopted under that subchapter, the liability of a fiduciary
6-16 under this code or the Water Code for the release or threatened
6-17 release of solid waste at, from, or in connection with a solid
6-18 waste facility held in a fiduciary capacity does not exceed the
6-19 assets held in the fiduciary capacity.
6-20 (b) Subsection (a) does not apply to the extent that a
6-21 person is liable independently of the person's ownership of a solid
6-22 waste facility as a fiduciary or actions taken in a fiduciary
6-23 capacity.
6-24 (c) Subsections (a) and (d) do not limit the liability
6-25 pertaining to a release or threatened release of solid waste if
6-26 negligence, gross negligence, or wilful misconduct of a fiduciary
6-27 causes or contributes to the release or threatened release.
6-28 (d) Except as otherwise provided by Subchapter I, Chapter
6-29 26, Water Code, or rules adopted under that subchapter, a fiduciary
6-30 is not liable in the fiduciary's personal capacity under this code
6-31 or the Water Code for:
6-32 (1) undertaking or directing another person to
6-33 undertake a response action under the national contingency plan
6-34 adopted under 42 U.S.C. Section 9605, under a commission-approved
6-35 cleanup plan, or under the direction of an on-scene coordinator
6-36 designated under the national contingency plan or a
6-37 commission-approved cleanup plan;
6-38 (2) undertaking or directing another person to
6-39 undertake any other lawful means of addressing solid waste in
6-40 connection with the solid waste facility;
6-41 (3) terminating the fiduciary relationship;
6-42 (4) including in the terms of the fiduciary agreement
6-43 a covenant, warranty, or other term or condition that relates to
6-44 compliance with an environmental law or monitoring or enforcing the
6-45 term or condition;
6-46 (5) monitoring or undertaking one or more inspections
6-47 of the solid waste facility;
6-48 (6) providing financial or other advice or counseling
6-49 to other parties to the fiduciary relationship, including the
6-50 settlor or beneficiary;
6-51 (7) restructuring, renegotiating, or otherwise
6-52 altering the terms and conditions of the fiduciary relationship;
6-53 (8) administering, as a fiduciary, a solid waste
6-54 facility that was contaminated before the fiduciary relationship
6-55 began; or
6-56 (9) declining to take an action described by
6-57 Subdivisions (2)-(8).
6-58 (e) This section does not:
6-59 (1) affect a right, immunity, or defense available
6-60 under this code or the Water Code that is applicable to a person
6-61 subject to this section;
6-62 (2) create any liability for a person; or
6-63 (3) create a private right of action against a
6-64 fiduciary or any other person.
6-65 (f) This section does not apply to a person if the person:
6-66 (1) acts in a capacity other than that of a fiduciary
6-67 or in a beneficiary capacity and, in that capacity, directly or
6-68 indirectly benefits from a trust or fiduciary relationship; or
6-69 (2) is a beneficiary and a fiduciary with respect to
7-1 the same fiduciary estate and, as a fiduciary, receives benefits
7-2 that exceed customary or reasonable compensation, and incidental
7-3 benefits, permitted under other applicable law.
7-4 (g) This section does not preclude a claim under this code
7-5 or the Water Code against:
7-6 (1) the assets of the estate or trust administered by
7-7 the fiduciary; or
7-8 (2) a nonemployee agent or independent contractor
7-9 retained by a fiduciary.
7-10 (Sections 361.653-361.700 reserved for expansion)
7-11 SUBCHAPTER U. LENDER LIABILITY
7-12 Sec. 361.701. DEFINITIONS. In this subchapter:
7-13 (1) "Extension of credit" includes a lease finance
7-14 transaction:
7-15 (A) in which the lessor does not initially
7-16 select the leased solid waste facility and does not during the
7-17 lease term control the daily operations or maintenance of the solid
7-18 waste facility; or
7-19 (B) that conforms with, as appropriate,
7-20 regulations issued by:
7-21 (i) the appropriate federal banking agency
7-22 or the appropriate state bank supervisor, as those terms are
7-23 defined by Section 3, Federal Deposit Insurance Act (12 U.S.C.
7-24 Section 1813); or
7-25 (ii) the National Credit Union
7-26 Administration Board.
7-27 (2) "Financial or administrative function" includes a
7-28 function such as a function of a credit manager, accounts payable
7-29 officer, accounts receivable officer, personnel manager,
7-30 comptroller, or chief financial officer, or a similar function.
7-31 (3) "Foreclosure" and "foreclose" mean, respectively,
7-32 acquiring, and to acquire, a solid waste facility through:
7-33 (A) purchase at sale under a judgment or decree,
7-34 power of sale, or nonjudicial foreclosure sale;
7-35 (B) a deed in lieu of foreclosure, or similar
7-36 conveyance from a trustee;
7-37 (C) repossession, if the solid waste facility
7-38 was security for an extension of credit previously contracted;
7-39 (D) conveyance under an extension of credit
7-40 previously contracted, including the termination of a lease
7-41 agreement; or
7-42 (E) any other formal or informal manner by which
7-43 the person acquires, for subsequent disposition, title to or
7-44 possession of a solid waste facility in order to protect the
7-45 security interest of the person.
7-46 (4) "Lender" means:
7-47 (A) an insured depository institution, as that
7-48 term is defined by Section 3, Federal Deposit Insurance Act (12
7-49 U.S.C. Section 1813);
7-50 (B) an insured credit union, as that term is
7-51 defined by Section 101, Federal Credit Union Act (12 U.S.C. Section
7-52 1752);
7-53 (C) a bank or association chartered under the
7-54 Farm Credit Act of 1971 (12 U.S.C. Section 2001 et seq.);
7-55 (D) a leasing or trust company that is an
7-56 affiliate of an insured depository institution;
7-57 (E) any person, including a successor or
7-58 assignee of any such person, that makes a bona fide extension of
7-59 credit to or takes or acquires a security interest from a
7-60 nonaffiliated person;
7-61 (F) the Federal National Mortgage Association,
7-62 the Federal Home Loan Mortgage Corporation, the Federal
7-63 Agricultural Mortgage Corporation, or any other entity that in a
7-64 bona fide manner buys or sells loans or interests in loans;
7-65 (G) a person that insures or guarantees against
7-66 a default in the repayment of an extension of credit, or acts as a
7-67 surety with respect to an extension of credit, to a nonaffiliated
7-68 person;
7-69 (H) a person that provides title insurance and
8-1 that acquires a solid waste facility as a result of assignment or
8-2 conveyance in the course of underwriting claims and claims
8-3 settlement; and
8-4 (I) an agency of this state that makes an
8-5 extension of credit to or acquires a security interest from:
8-6 (i) a federal or state agency;
8-7 (ii) a county, municipality, or other body
8-8 politic or corporate of this state, including:
8-9 (a) a district or authority
8-10 created under Section 52, Article III, or Section 59, Article XVI,
8-11 Texas Constitution;
8-12 (b) an interstate compact
8-13 commission to which this state is a party; or
8-14 (c) a nonprofit water
8-15 supply corporation created and operating under Chapter 76, Acts of
8-16 the 43rd Legislature, 1st Called Session, 1933 (Article 1434a,
8-17 Vernon's Texas Civil Statutes); or
8-18 (iii) another person.
8-19 (5) "Operational function" includes a function such as
8-20 that of a facility or plant manager, operations manager, chief
8-21 operating officer, or chief executive officer.
8-22 (6) "Security interest" includes a right under a
8-23 mortgage, deed of trust, assignment, judgment lien, pledge,
8-24 security agreement, factoring agreement, or lease and any other
8-25 right accruing to a person to secure the repayment of money, the
8-26 performance of a duty, or any other obligation by a nonaffiliated
8-27 person.
8-28 (7) "Solid waste facility":
8-29 (A) means:
8-30 (i) all contiguous land, including
8-31 structures, appurtenances, and other improvements on the land, used
8-32 for processing, storing, or disposing of solid waste, including a
8-33 publicly or privately owned solid waste facility consisting of
8-34 several processing, storage, or disposal operational units such as
8-35 one or more landfills, surface impoundments, or a combination of
8-36 units; and
8-37 (ii) any building, structure,
8-38 installation, equipment, pipe, or pipeline, including any pipe into
8-39 a sewer or publicly owned treatment works, well, pit, pond, lagoon,
8-40 impoundment, ditch, landfill, storage container, motor vehicle,
8-41 rolling stock, or aircraft, or any site or area where a hazardous
8-42 substance has been deposited, stored, disposed of, placed, or
8-43 otherwise come to be located; and
8-44 (B) does not include a:
8-45 (i) consumer product in consumer use; or
8-46 (ii) vessel.
8-47 Sec. 361.702. EXCLUSION OF LENDERS NOT PARTICIPANTS IN
8-48 MANAGEMENT. (a) In Section 361.271, the term "owner or operator"
8-49 does not include a person that is a lender that:
8-50 (1) without participating in the management of a solid
8-51 waste facility, holds a security interest in or with regard to the
8-52 solid waste facility; or
8-53 (2) did not participate in management of a solid waste
8-54 facility before foreclosure, notwithstanding the fact that the
8-55 person:
8-56 (A) forecloses on the solid waste facility; and
8-57 (B) after foreclosure, sells, re-leases, in the
8-58 case of a lease finance transaction, or liquidates the solid waste
8-59 facility, maintains business activities, winds up operations,
8-60 undertakes a response action with respect to the solid waste
8-61 facility under the national contingency plan adopted under 42
8-62 U.S.C. Section 9605, under a commission-approved cleanup plan, or
8-63 under the direction of an on-scene coordinator appointed under the
8-64 national contingency plan or a commission-approved cleanup plan, or
8-65 takes any other measure to preserve, protect, or prepare the solid
8-66 waste facility before sale or disposition, if the person seeks to
8-67 sell, re-lease, in the case of a finance transaction, or otherwise
8-68 divest the person of the facility at the earliest practicable,
8-69 commercially reasonable time, on commercially reasonable terms,
9-1 taking into account market conditions and legal and regulatory
9-2 requirements.
9-3 (b) For purposes of Subsection (a)(2)(B), a lender is
9-4 presumed to divest the lender of the solid waste facility at the
9-5 earliest practicable, commercially reasonable time if, within 12
9-6 months after foreclosure, the lender:
9-7 (1) lists the solid waste facility with a broker,
9-8 dealer, or agent who deals in that type of property; or
9-9 (2) advertises the solid waste facility for sale or
9-10 other disposition at least monthly in:
9-11 (A) a real estate publication;
9-12 (B) a trade or other publication appropriate for
9-13 the solid waste facility being advertised; or
9-14 (C) a newspaper of general circulation in the
9-15 area in which the solid waste facility is located.
9-16 (c) For purposes of Subsection (b), the 12-month period
9-17 begins:
9-18 (1) when the lender acquires marketable title if the
9-19 lender, after the expiration of any redemption period or other
9-20 waiting period required by law, was acting diligently to acquire
9-21 marketable title; or
9-22 (2) on the date of foreclosure or its equivalent if
9-23 the lender does not act diligently to acquire marketable title.
9-24 (d) Except as otherwise provided by Subchapter I, Chapter
9-25 26, Water Code, or rules adopted under that subchapter, a lender is
9-26 not liable under this code or the Water Code to undertake a removal
9-27 or remedial action or to pay a fine or penalty arising from the
9-28 release or threatened release of solid waste at, from, or in
9-29 connection with the solid waste facility in which the lender
9-30 maintains a security interest or that the lender has acquired
9-31 through foreclosure if:
9-32 (1) the lender has not participated in management
9-33 before foreclosure;
9-34 (2) the conditions giving rise to the release or
9-35 threat of release existed before foreclosure; and
9-36 (3) the lender seeks to divest the lender of the
9-37 property under Subsections (a)(2)(B) and (b).
9-38 (e) Notwithstanding Subsection (d), if a lender after
9-39 foreclosure operates, directs the operation of, or maintains the
9-40 operation of business activities, this section does not exempt or
9-41 excuse the lender from compliance with legal requirements
9-42 applicable to the operation of that business. Those operational
9-43 requirements include permitting, reporting, monitoring, compliance
9-44 with emission limitations, financial responsibility and assurance
9-45 requirements, payment of fees, and payment of fines and penalties
9-46 for noncompliance with those requirements.
9-47 Sec. 361.703. PARTICIPATION IN MANAGEMENT. (a) For
9-48 purposes of Section 361.702, the term "participate in management":
9-49 (1) means actually participating in the management or
9-50 operational affairs of a solid waste facility; and
9-51 (2) does not include merely having the capacity to
9-52 influence, or the unexercised right to control, a solid waste
9-53 facility or facility operations.
9-54 (b) A person that is a lender that holds a security interest
9-55 in or with regard to a solid waste facility is considered to
9-56 participate in management only if, while the borrower is still in
9-57 possession of the solid waste facility encumbered by the security
9-58 interest, the person:
9-59 (1) exercises decision-making control over the
9-60 environmental compliance related to the solid waste facility such
9-61 that the person has undertaken responsibility for the solid waste
9-62 handling or disposal practices related to the solid waste facility;
9-63 or
9-64 (2) exercises control at a level comparable to that of
9-65 a manager of the solid waste facility such that the person has
9-66 assumed or manifested responsibility:
9-67 (A) for the overall management of the solid
9-68 waste facility encompassing day-to-day decisionmaking with respect
9-69 to environmental compliance; or
10-1 (B) over all or substantially all of the
10-2 operational functions, as distinguished from financial or
10-3 administrative functions, of the solid waste facility other than
10-4 the function of environmental compliance.
10-5 (c) The term "participate in management" does not include:
10-6 (1) performing an act or failing to act before the
10-7 time at which a security interest is created in a solid waste
10-8 facility;
10-9 (2) holding a security interest or abandoning or
10-10 releasing a security interest;
10-11 (3) including in the terms of an extension of credit,
10-12 or in a contract or security agreement relating to the extension, a
10-13 covenant, warranty, or other term or condition that relates to
10-14 environmental compliance;
10-15 (4) monitoring or enforcing the terms and conditions
10-16 of the extension of credit or security interest;
10-17 (5) monitoring or undertaking one or more inspections
10-18 of the solid waste facility;
10-19 (6) requiring a response action or other lawful means
10-20 of addressing the release or threatened release of solid waste in
10-21 connection with the solid waste facility before, during, or on the
10-22 expiration of the term of the extension of credit;
10-23 (7) providing financial or other advice or counseling
10-24 in an effort to mitigate, prevent, or cure default or diminution in
10-25 the value of the solid waste facility;
10-26 (8) restructuring, renegotiating, or otherwise
10-27 agreeing to alter the terms and conditions of the extension of
10-28 credit or security interest, exercising forbearance;
10-29 (9) exercising other remedies that may be available
10-30 under applicable law for the breach of a term or condition of the
10-31 extension of credit or security agreement; or
10-32 (10) conducting a response action under the national
10-33 contingency plan adopted under 42 U.S.C. Section 9605, under a
10-34 commission-approved cleanup plan, or under the direction of an
10-35 on-scene coordinator appointed under the national contingency plan
10-36 or a commission-approved cleanup plan, if the actions do not rise
10-37 to the level of participating in management within the meaning of
10-38 Subsections (a) and (b).
10-39 (Sections 361.704-361.750 reserved for expansion
10-40 SUBCHAPTER V. IMMUNITY FROM LIABILITY OF INNOCENT OWNER OR
10-41 OPERATOR
10-42 Sec. 361.751. DEFINITIONS. In this subchapter:
10-43 (1) "Contaminant" has the meaning assigned by Section
10-44 361.601.
10-45 (2) "Innocent owner or operator" means a person that:
10-46 (A) is an owner or operator of property that has
10-47 become contaminated as a result of a release or migration of
10-48 contaminants from a source or sources not located on or at the
10-49 property; and
10-50 (B) did not cause or contribute to the source or
10-51 sources of the contamination referred to in Paragraph (A).
10-52 Sec. 361.752. IMMUNITY FROM LIABILITY; ACCESS TO PROPERTY.
10-53 (a) An innocent owner or operator of property is not liable under
10-54 this code or the Water Code for investigation, monitoring,
10-55 remediation, or corrective or other response action regarding the
10-56 conditions attributable to a release or migration of a contaminant
10-57 or otherwise liable regarding those conditions.
10-58 (b) A person that acquires a portion of the tract on which
10-59 the source of a release of contaminants is located from the person
10-60 that caused the release is eligible for immunity under Subsection
10-61 (a) only if, after appropriate inquiry consistent with good
10-62 commercial or customary practice, the person did not know or have
10-63 reason to know of the contamination at the time the person acquired
10-64 the property.
10-65 (c) To be eligible for immunity under Subsection (a), an
10-66 owner or operator must grant reasonable access to the property for
10-67 purposes of investigation or remediation to a person designated by
10-68 the executive director. An agreement for reasonable access may
10-69 provide:
11-1 (1) that the designated person may not unreasonably
11-2 interfere with the use of the property;
11-3 (2) for payment of reasonable compensation for access
11-4 to the property; or
11-5 (3) that the owner or operator is indemnified from
11-6 liability for an intentional or negligent act of the designated
11-7 person arising from the person's access to and use of the property.
11-8 (d) This section does not limit any right of the commission
11-9 under another provision of this code or the Water Code to obtain
11-10 access to the property.
11-11 Sec. 361.753. CERTIFICATION. (a) A person may apply to the
11-12 commission for a certificate confirming that the person is an
11-13 innocent owner or operator. The application must include a
11-14 complete site investigation report that demonstrates that:
11-15 (1) the property has become contaminated as a result
11-16 of a release or migration of contaminants from a source or sources
11-17 not located on or at the property;
11-18 (2) the owner or operator has not caused or
11-19 contributed to the source or sources of the contamination referred
11-20 to in Subdivision (1); and
11-21 (3) the owner or operator is eligible for immunity
11-22 under Section 361.752(b).
11-23 (b) The commission may charge an application fee in an
11-24 amount not to exceed the cost of reviewing the application. The
11-25 commission shall deposit a fee collected under this subsection to
11-26 the credit of the hazardous and solid waste remediation fee fund.
11-27 (c) Not later than the 45th day after the date the
11-28 commission receives the application, the commission shall notify
11-29 the applicant whether the application is complete.
11-30 (d) Not later than the 90th day after the date the
11-31 commission receives the application, the commission shall:
11-32 (1) issue or deny the certificate; or
11-33 (2) notify the applicant of any additional information
11-34 needed to review the application.
11-35 (e) Not later than the 45th day after the date the
11-36 commission receives the additional information requested under
11-37 Subsection (d)(2), the commission shall issue or deny the
11-38 certificate.
11-39 (f) The certificate evidences the immunity from liability of
11-40 the applicant as provided by Section 361.752.
11-41 (g) The commission may condition the issuance of the
11-42 certificate on the placement of restrictions on the use of the
11-43 property that are reasonably necessary to protect the public
11-44 health, including:
11-45 (1) institutional controls such as deed restrictions
11-46 or municipal zoning restrictions; or
11-47 (2) at the owner's or operator's option, other control
11-48 measures.
11-49 Sec. 361.754. RIGHTS OF INNOCENT OWNER OR OPERATOR REGARDING
11-50 CONTAMINATION FROM SOURCE NOT LOCATED ON OR AT PROPERTY. This
11-51 subchapter does not limit the right of an innocent owner or
11-52 operator to pursue any remedy available at law or in equity for
11-53 conditions attributable to the release or migration of contaminants
11-54 from a source or sources that are not located on or at the
11-55 property.
11-56 SECTION 16. Subchapter C, Chapter 2155, Government Code, is
11-57 amended by adding Section 2155.145 to read as follows:
11-58 Sec. 2155.145. CERTAIN PURCHASES BY TEXAS NATURAL RESOURCE
11-59 CONSERVATION COMMISSION. The Texas Natural Resource Conservation
11-60 Commission is delegated all purchasing functions relating to the
11-61 administration of Subchapters F and I, Chapter 361, Health and
11-62 Safety Code, subject to the rules adopted by the commission under
11-63 Section 2155.132(c).
11-64 SECTION 17. Section 2166.003(a), Government Code, is amended
11-65 to read as follows:
11-66 (a) Unless otherwise provided, this chapter does not apply
11-67 to:
11-68 (1) a project constructed by and for the Texas
11-69 Department of Transportation;
12-1 (2) a project constructed by and for a state
12-2 institution of higher education;
12-3 (3) a pen, shed, or ancillary building constructed by
12-4 and for the Department of Agriculture for the processing of
12-5 livestock before export;
12-6 (4) a project constructed by the Parks and Wildlife
12-7 Department;
12-8 (5) a repair or rehabilitation project, except a major
12-9 renovation, of buildings and grounds on the commission inventory;
12-10 (6) a repair and rehabilitation project of another
12-11 using agency, if all labor for the project is provided by the
12-12 regular maintenance force of the using agency under specific
12-13 legislative authorization and the project does not require the
12-14 advance preparation of working plans or drawings; [or]
12-15 (7) a repair and rehabilitation project involving the
12-16 use of contract labor, if the project has been excluded from this
12-17 chapter by commission rule and does not require the advance
12-18 preparation of working plans or drawings; or
12-19 (8) an action taken by the Texas Natural Resource
12-20 Conservation Commission under Subchapter F or I, Chapter 361,
12-21 Health and Safety Code.
12-22 SECTION 18. Subchapter A, Chapter 2253, Government Code, is
12-23 amended by adding Section 2253.002 to read as follows:
12-24 Sec. 2253.002. EXEMPTION. This chapter does not apply to a
12-25 public work contract entered into by a state agency relating to an
12-26 action taken under Subchapter F or I, Chapter 361, Health and
12-27 Safety Code, or Subchapter I, Chapter 26, Water Code.
12-28 SECTION 19. Section 26.265, Water Code, is amended by adding
12-29 Subsections (h)-(j) to read as follows:
12-30 (h) Notwithstanding Subsection (g), a responsible person who
12-31 enters into a settlement agreement with the state that resolves all
12-32 liability of the person to the state for a site subject to
12-33 Subchapter F, Chapter 361, Health and Safety Code, is released from
12-34 liability to a person described by Section 361.344(a), Health and
12-35 Safety Code, for contribution or indemnity under this code
12-36 regarding a matter addressed in the settlement agreement.
12-37 (i) A settlement agreement does not discharge the liability
12-38 of a nonsettling person to the state unless the agreement provides
12-39 otherwise.
12-40 (j) Notwithstanding Subsection (i), a settlement agreement
12-41 reduces the potential liability to the state of the nonsettling
12-42 persons by the amount of the settlement.
12-43 SECTION 20. This Act takes effect September 1, 1997.
12-44 SECTION 21. The importance of this legislation and the
12-45 crowded condition of the calendars in both houses create an
12-46 emergency and an imperative public necessity that the
12-47 constitutional rule requiring bills to be read on three several
12-48 days in each house be suspended, and this rule is hereby suspended.
12-49 * * * * *