24496 Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Parts 9 and 35 

[FRL–8306–2] 

RIN 2050–AE62 

Cooperative Agreements and 

Superfund State Contracts for 

Superfund Response Actions 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Final rule. 

SUMMARY: This final rule amends the 

regulation for Superfund Cooperative 

Agreements and Superfund State 

Contracts. The revisions to the 

regulation: Incorporate EPA policy 

changes since 1990 that impact this 

regulation; reduce the burden placed by 

this regulation on Cooperative 

Agreement recipients and parties to 

Superfund State Contracts; increase 

reliance on the Federal Government’s 

uniform administrative requirements for 

grants and Cooperative Agreements to 

State and local governments, wherever 

possible; authorize procedures that 

required deviations, on multiple 

occasions, under the existing regulation; 

expressly authorize previous program 

initiatives that were proven successful 

on a pilot basis; provide additional 

regulatory flexibility without negatively 

impacting cost recovery actions; update 

cross-references to other regulations that 

have changed or been removed; and 

eliminate references to obsolete forms. 

The revisions affect States, Indian 

Tribes, intertribal consortia, and 

political subdivisions. The revisions 

will improve the administration and 

effectiveness of Superfund Cooperative 

Agreements and Superfund State 

Contracts. 

DATES: This rule is effective July 2, 

2007. 

ADDRESSES: EPA has established a 

docket for this action under Docket ID 

No. EPA–HQ–SFUND–2006–0498. All 

documents in the docket are listed on 

the www.regulations.gov Web site. 

Although listed in the index, some 

information is not publicly available, 

e.g., confidential business information 

(CBI) or other information whose 

disclosure is restricted by statute. 

Certain other material, such as 

copyrighted material, is not placed on 

the Internet and will be publicly 

available only in hard copy form. 

Publicly available docket materials are 

available either electronically through 

www.regulations.gov or in hard copy at 

the Superfund Docket, EPA/DC, EPA 

West, 1301 Constitution Ave., NW., 

Washington, DC. 

Note: The EPA Docket Center suffered 

damage due to flooding during the last week 

of June 2006. The Docket Center is 

continuing to operate. However, during the 

cleanup, there will be temporary changes to 

Docket Center telephone numbers, addresses, 

and hours of operation for people who wish 

to visit the Public Reading Room to view 

documents. Consult EPA’s Federal Register 

notice at 71 FR 38147 (July 5, 2006) or the 

EPA Web site at http://www.epa.gov/ 

epahome/dockets.htm for current 

information on docket status, locations and 

telephone numbers. 

FOR FURTHER INFORMATION CONTACT: 

Angelo Carasea, Office of Solid Waste 

and Emergency Response, Office of 

Superfund Remediation and Technology 

Innovation, (5204P), Environmental 

Protection Agency, 1200 Pennsylvania 

Ave., NW., Washington, DC 20460; 

telephone number: (703) 603–8828, fax 

number: (703) 603–9112, e-mail address: 

carasea.angelo@epa.gov. 

SUPPLEMENTARY INFORMATION: 

I. Statutory Authority 

II. Applicability 

III. Background 

IV. Description of Key Changes 

V. Section-by-Section Analysis 

VI. Statutory and Executive Order Reviews 

Statutory Authority 

This rule is issued under section 

104(a)–(j) of the Comprehensive 

Environmental Response, 

Compensation, and Liability Act of 1980 

(42 U.S.C. 9601 et seq.) as amended 

(hereinafter CERCLA). 

II. Applicability 

The final regulation requirements 

shall apply to all new Cooperative 

Agreements and Superfund State 

Contracts, funded under CERCLA, 

which EPA signs on or after the effective 

date of this regulation. EPA may agree 

to amend existing Cooperative 

Agreements or Superfund State 

Contracts to make the final regulation 

requirements applicable to work 

performed on and after the date EPA 

signs the amendment. 

III. Background 

CERCLA launched the nation’s first 

centralized and substantial commitment 

to clean up hazardous substance sites. 

CERCLA, or Superfund, provided 

Federal authority and resources to 

respond directly to releases (or 

threatened releases) of hazardous 

substances, pollutants, or contaminants 

that could endanger human health or 

the environment. The law also 

authorized enforcement action and cost 

recovery from those responsible for a 

release of a hazardous substance. 

This regulation authorizes two types 

of Superfund response agreements for 

State, Tribal (including intertribal 

consortium) and political subdivision 

participation in CERCLA 

implementation: Cooperative 

Agreements and Superfund State 

Contracts. These agreements ensure 

State and Tribal involvement, consistent 

with section 121 of CERCLA, 42 U.S.C. 

9621 (hereinafter section 121), and 

section 126 of CERCLA, 42 U.S.C. 9626, 

(hereinafter section 126) and are used to 

obtain State assurances required under 

section 104 of CERCLA, 42 U.S.C. 9604, 

(hereinafter section 104) before EPA 

begins a remedial action. 

EPA uses Cooperative Agreements to 

transfer funds to a State, political 

subdivision, or Indian Tribe that 

assumes responsibility as the lead or 

support agency for Superfund 

responses. Core Program Cooperative 

Agreements are used to fund non-sitespecific activities that support a State or 

Indian Tribe’s involvement in CERCLA 

responses. 

A Superfund State Contract is used to 

document a State’s CERCLA section 104 

assurances when either EPA or a 

political subdivision has the lead role in 

the implementation of a remedial 

action. The regulation is revised to 

authorize, but not require, a three-party 

Superfund State Contract whenever a 

political subdivision takes the lead for 

a remedial action. 

The role of States, Indian Tribes, and 

political subdivisions in Superfund has 

evolved substantially since 1990 when 

the original 40 CFR part 35 subpart O 

regulation was promulgated. The 

recipients’ cleanup programs have 

matured and become more 

sophisticated. In addition, EPA has 

actively sought to fulfill CERCLA’s 

mandate in sections 121 and 126 to 

provide States and Indian Tribes a 

‘‘substantial and meaningful 

involvement’’ in Superfund by 

providing Core Program funding for the 

development of State and Tribal 

infrastructure. The current subpart O 

imposes more restrictive requirements 

on recipients than 40 CFR part 31 

because, in 1990, EPA believed these 

requirements were necessary for 

enforcement and cost recovery 

purposes. With the maturing of State 

and Tribal programs, some of these 

added burdens have been judged to be 

unnecessary. In the amended subpart O, 

EPA allows recipients to follow the less 

burdensome 40 CFR part 31 

requirements, wherever this is possible, 

without compromising cost recovery or 

other Superfund-specific requirements. 

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Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 24497 

For example, with respect to 

procurement procedures, the amended 

subpart O eliminates the burdensome 

requirement for grantees to certify that 

their procurement systems meet the 

requirements of this subpart. The final 

regulation retains current requirements 

for awarding funds and tracking costs by 

site, activity, and operable unit, when 

appropriate, to ensure adequate 

documentation of costs. Retention of 

such documentation requirements will 

meet Superfund cost recovery 

requirements. 

IV. Description of Key Changes 

EPA made limited revisions to certain 

sections of the regulation. The following 

is a brief description of the key changes. 

A. Combining Certain Activities Into a 

Single Cooperative Agreement 

This revision enables EPA to award a 

single Cooperative Agreement for a 

single activity or multiple activities; a 

single activity at multiple sites; and 

multiple activities at multiple sites. For 

example, EPA may award a single 

Cooperative Agreement for Core 

Program, pre-remedial and support 

agency activities. EPA will not award or 

amend a Cooperative Agreement to a 

political subdivision to conduct 

multiple activities at multiple sites. The 

revised regulation requires a single 

Cooperative Agreement for each State, 

political subdivision or Indian Tribelead remedial action and certain 

removal actions. 

B. Core Program 

This revision provides for the 

maintenance of program elements 

previously developed using Core 

Program funding; however, EPA funding 

of the recipients’ Core Program activities 

is dependent on the availability of EPA 

funds. Also this revision does not 

require Indian Tribes, including 

intertribal consortia, to meet the Core 

Program match requirements. 

C. Indian Tribes 

In light of the many and varied 

interests that Indian Tribes have in the 

Superfund cleanup process, EPA is 

reducing unnecessary obstacles to Tribal 

involvement. When EPA promulgated 

the current regulation, it made a policy 

decision to require Indian Tribes to 

meet the criteria at 40 CFR 300.515(b), 

which include establishing jurisdiction 

under 40 CFR 300.515(b)(3), to be 

eligible for any Cooperative Agreement 

under this subpart. The revised 

regulation eliminates the requirement 

for demonstrating jurisdiction for all 

Tribal Core Program and most Tribal 

support agency agreements. To reflect 

the reduced emphasis on jurisdiction 

and to make the regulation’s language 

more precise, the regulation is modified 

in several appropriate places to delete 

references to Tribal ‘‘jurisdiction,’’ and 

refer instead to a Tribal ‘‘area of Indian 

country.’’ The regulation also removes 

cost share requirements for Core 

Program and support agency 

Cooperative Agreements. As a result, 

Indian Tribes have no cost share 

requirements under the revised 

regulation. Finally, an Indian Tribe will 

not need to acquire an interest in or 

accept transfer of an interest in real 

property acquired with CERCLA funds. 

This is not required under CERCLA 

section 104(j). 

D. Intertribal Consortium 

Under the revised regulation, an 

intertribal consortium can enter into a 

Cooperative Agreement with EPA. This 

change implements the Federal Register 

notice, ‘‘Update to EPA Policy On 

Certain Grants to Intertribal Consortia,’’ 

(See, 67 FR 67181 (November 4, 2002)). 

An intertribal consortium must meet the 

same subpart O requirements for 

applying for and administering a 

Cooperative Agreement as an Indian 

Tribe. 

E. Progress Reports 

The revised subpart O relaxes current 

reporting requirements that mandate 

quarterly reports. In the revised 

regulation, the EPA award official may 

specify that progress reports be 

submitted annually, semi-annually, or 

quarterly. 

F. Five-year Review 

Participation in five-year reviews of 

the continuing effectiveness of a 

remedial action is added as an eligible 

support agency activity. 

G. Cost Share for the Support Agency 

The 10 percent cost share requirement 

for remedial action support agency 

activities at EPA-lead sites is 

eliminated. 

H. Program Income 

With respect to program income, the 

revised regulation adds the following: 

‘‘Recoveries of Federal cost share 

amounts are not program income, and 

whether such recoveries are received 

before or after expiration of the 

Cooperative Agreement, must be 

reimbursed promptly to EPA.’’ 

I. Credit Verification Procedures 

EPA may use other financial reviews 

in lieu of an audit to verify expenditures 

submissions. 

J. Excess Cash Cost Share Contributions/ 

Over Match Revisions 

The recipient may direct EPA to 

return the excess funds or to use the 

over match at one site to meet the cost 

share obligations at another site. 

K. Thresholds for Force Accounts, Small 

Purchases and Cost Analysis 

Force accounts, small purchases, and 

cost analysis dollar amount thresholds 

are linked to the simplified acquisition 

threshold, as defined in the Office of 

Federal Procurement Policy Act (41 

U.S.C. 403, Definitions). The dollar 

amount for the simplified acquisition 

threshold is currently set at $100,000. 

L. Unalterable Electronic Format 

An unalterable electronic format may 

be substituted for original records if it 

is performed in accordance with the 

technical regulations concerning 

Federal Government records and EPA 

record management requirements. The 

unalterable electronic format 

requirement replaces the microform 

requirement. 

M. Three-Party Superfund State 

Contract 

Under the revised regulation, the 

three-party Superfund State Contract is 

optional rather than mandatory. EPA 

has found that it is sometimes 

advantageous for the Superfund State 

Contract to be signed only by the State 

and EPA to obtain needed State 

CERCLA assurances, and to rely on a 

separate EPA Cooperative Agreement 

with a political subdivision. This 

revised regulation adds the requirement 

that EPA obtain State concurrence 

before awarding a Cooperative 

Agreement for remedial action to a 

political subdivision. EPA is making 

this change because EPA believes that it 

is important to maintain close 

communication and coordination with 

the State in all CERCLA responses. 

N. Obsolete References 

This revision updates cross-references 

to other regulations that have changed 

or been removed, and eliminates 

references to obsolete forms. 

V. Section-by-Section Analysis 

Section 35.6000 Authority 

This section remains the same, except 

for a more specific citing of CERCLA. 

Section 35.6005 Purpose and Scope 

In paragraph (a), the word ‘‘CERCLAfunded’’, is deleted from the phrase, 

‘‘for administering CERCLA-funded 

Cooperative Agreements,’’ and a 

reference to CERCLA section 104(d)(1) 

is added after this phrase. 

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24498 Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 

Paragraph (b) is eliminated because it 

cites program authorities, which are not 

within the scope of CERCLA section 104 

(a) through (j). The remaining 

paragraphs are resequenced to reflect 

deletion of paragraph (b). 

Section 35.6010 Indian Tribe and 

Intertribal Consortium Eligibility 

This section’s title is changed from 

‘‘Eligibility,’’ to ‘‘Indian Tribe and 

Intertribal Consortium Eligibility.’’ The 

words ‘‘States’’ and ‘‘political 

subdivisions’’ are removed from this 

section, leaving text that is devoted 

exclusively to Indian Tribe eligibility. 

The revised section adds, in paragraph 

(a), that an Indian Tribe is not required 

to demonstrate jurisdiction under 40 

CFR 300.515(b)(3) of the National Oil 

and Hazardous Substances Pollution 

Contingency Plan (National 

Contingency Plan or NCP) to be eligible 

for Core Program Cooperative 

Agreements, or those support agency 

Cooperative Agreements for which 

jurisdiction is not needed for the Tribe 

to carry out the support agency 

activities of the work plan. Finally, the 

revised section contains a new 

paragraph (c), which states that an 

intertribal consortium is eligible only if 

each consortium member is an eligible 

Tribe and that all members authorize 

the consortium to apply for and receive 

assistance. 

Section 35.6015 Definitions 

The following changes are made in 

this section. 

The definition of CERCLA is 

shortened to refer only to the United 

States Code citation. 

Under the Core Program Cooperative 

Agreement definition, the word 

‘‘support’’ is replaced with the words 

‘‘develop and maintain’’. This change 

clarifies that the Core Program funding 

can be made available for continuing 

program activities and operations. Also, 

the revised regulation corrects the 

omission of Indian Tribes from the 

definition in the previous regulation. The definition of ‘‘Indian Tribe’’ is 

revised by adding a sentence stating that 

the term also includes an intertribal 

consortium consisting of two or more 

federally recognized Tribes. The National Priorities List definition 

is revised to conform it with the 

definition in the NCP at 40 CFR 300.5. 

The revised regulation defines two 

additional terms: (a) Intertribal 

consortium and (b) simplified 

acquisition threshold. The intertribal 

consortium definition is based on the 

definition found in EPA’s revised policy 

concerning certain grants to intertribal 

consortia (See, 67 FR 67181 (November 

4, 2002)). The simplified acquisition 

threshold definition is taken from 41 

U.S.C. 403, Definitions. 

The revised regulation deletes the 

definition for ‘‘excess property.’’ This 

term is not used in the regulation. 

Section 35.6020 Requirements for Both 

Applicants and Recipients 

The text in § 35.6020, ‘‘Other 

statutory provisions’’ is removed. The 

text in § 35.6560 is revised to provide 

updated references to EPA’s 

codifications of the Government-wide 

debarment and suspension rules, and 

drug-free workplace rules; the revised 

section is retitled, ‘‘Requirements for 

Both Applicants and Recipients,’’ and 

renumbered as § 35.6020. Conforming 

amendments are made to crossreferences appearing in the revised 

regulation at § § 35.6550(a)(6) and 

35.6610(a). 

Section 35.6055 State-Lead PreRemedial Cooperative Agreements 

In paragraph (a)(2)(i), the phrase 

‘‘project officer’’ is changed to ‘‘EPA 

project officer.’’ 

Paragraphs (a)(3) to (a)(6) are deleted 

and replaced with a new paragraph 

(a)(3), which states that the applicant 

must submit all applicable forms and 

information authorized by 40 CFR 

31.10. 

Section 35.6060 Political SubdivisionLead Pre-Remedial Cooperative 

Agreements 

Paragraphs (c) and (d) are deleted. A 

three-party Superfund State Contract is 

authorized, but not required under §

35.6800. 

Section 35.6105 State-Lead Remedial 

Cooperative Agreements 

The following changes are made in 

this section. 

In paragraph (a), a new second 

sentence is added to indicate that 

applications for additional funding need 

only include the revised pages. This 

change is consistent with 40 CFR 

31.10(b)(4). 

Paragraphs (a)(3) to (a)(6) are deleted 

and replaced with a new paragraph 

(a)(3) that requires the applicant to 

submit all applicable forms and 

information authorized by 40 CFR 

31.10. 

Several editorial changes are made to 

paragraphs (b)(1) and (b)(2) to conform 

the text to CERCLA section 104(c)(3), 

and to add a reference to 40 CFR 

300.510(c)(1). 

New text is added to paragraph (b)(5) 

to make clear that a State must provide 

the real property assurance even if the 

State transfers its interest to a third 

party or political subdivision. In 

addition, if the political subdivision 

defaults, the State will accept transfer of 

the interest. Finally, the new text 

provides that if the State or political 

subdivision disposes of the transferred 

real property, it shall comply with the 

requirements for real property in 40 CFR 

31.31(c)(2). 

Section 35.6110 Indian Tribe-Lead 

Remedial Cooperative Agreements 

The following changes are made in 

this section. 

In paragraph (a), the phrase, ‘‘and, if 

appropriate, § 35.6105(b)(5),’’ is 

deleted. Also, paragraph (b)(2) is 

deleted. An Indian Tribe will not be 

required to assure EPA that it will take 

title to, acquire interest in, or accept 

transfer of an interest in real property 

acquired with CERCLA funds. Such an 

assurance is not required by CERCLA 

section 104. 

Paragraph (b)(3) is resequenced to 

(b)(2). The phrase ‘‘out of jurisdiction’’ 

is replaced with the phrase, ‘‘out-of-anIndian-Tribal-area-of-Indian-country’’. 

A new paragraph (b)(3) is added to 

make clear that CERCLA does not 

require Indian Tribes to share in the cost 

of CERCLA-funded remedial actions. 

Section 35.6115 Political SubdivisionLead Remedial Cooperative Agreement 

The sentences under paragraph (a) are 

deleted and replaced with the following 

sentences: ‘‘General. If the State 

concurs, EPA may allow a political 

subdivision with the necessary 

capabilities and jurisdictional authority 

to conduct remedial response activities 

at a site. EPA will award the political 

subdivision a Cooperative Agreement to 

conduct remedial response and enter 

into a parallel Superfund State Contract 

with the State if required (See §

35.6800, when a Superfund State 

Contract is required). The political 

subdivision may also be a signatory to 

the Superfund State Contract. The 

political subdivision must submit to the 

State a copy of all reports provided to 

EPA.’’ 

Paragraph (b) is deleted. 

The changes to paragraphs (a) and (b) 

are made because a three-party 

Superfund State Contract is authorized, 

but it is not required under § 35.6800. 

Paragraph (c) is resequenced to 

paragraph (b). 

Section 35.6120 Notification of the Outof-State or Out-of-an-Indian-TribalArea-of-Indian-Country Transfer of 

CERCLA Waste 

The title of § 35.6120 is changed. The 

phrase ‘‘out-of-jurisdiction’’ is replaced 

with the phrase, ‘‘Out-of-an-IndianTribal-Area-of-Indian-Country.’’ A 

corresponding change is made in 

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Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 24499 

paragraph (a). In paragraph (b)(2), the 

phrase, ‘‘The appropriate Indian Tribal 

official, who has jurisdictional authority 

in the area where the waste management 

facility is located,’’ is replaced with the 

phrase, ‘‘An appropriate official of an 

Indian Tribe in whose area of Indian 

country the waste management facility 

is located’’. 

Section 35.6205 Removal Cooperative 

Agreements 

In paragraph (e), the word, 

‘‘jurisdiction,’’ is replaced with the 

phrase, ‘‘area of Indian country’’. 

Section 35.6215 Eligibility for Core 

Program Cooperative Agreements 

In paragraph (a), the word ‘‘support’’ 

is replaced with the phrase ‘‘develop 

and maintain.’’ This change clarifies 

that the Core Program funding can be 

made available for continuing program 

activities and operations. 

Section 35.6225 Activities Eligible for 

Funding Under Core Program 

Cooperative Agreements 

In paragraph (a) and paragraph (a)(5), 

the word ‘‘support’’ is replaced with the 

phrase ‘‘develop and maintain’’. This 

change clarifies that the Core Program 

funding can be made available for 

continuing program activities and 

operations. 

Section 35.6230 Application 

Requirements 

The text in paragraph (d) is replaced 

with a cross-reference to 40 CFR 31.10. 

Section 35.6235 Cost Sharing 

Indian Tribes are not required to 

provide cost share for Core Program 

activities. This change supports EPA’s 

objectives under EPA Policy for the 

Administration of Environmental 

Programs on Indian Reservations 

(located at Web site: http:// 

www.epa.gov/indian/pdfs/indianpolicy-leavitt-pr.pdf) to (a) take 

affirmative steps to encourage and assist 

Tribes in assuming regulatory and 

program management responsibilities 

for reservation lands, and (b) take 

appropriate steps to remove existing 

legal and procedural impediments to 

working directly with Tribal 

government programs. Further, the word 

‘‘recipient’’ is changed to ‘‘State’’ since 

only a State is required to provide cost 

share for Core Program activities. 

Section 35.6245 Allowable Activities 

A sentence is added to clarify that a 

five-year review is an eligible support 

agency activity. 

Section 35.6250 Support Agency 

Cooperative Agreement Requirements 

In paragraph (a), the citation to ‘‘part 

29’’ is corrected to read ‘‘40 CFR part 

29’’. In the penultimate sentence of 

paragraph (a), the phrase ‘‘with the 

exception of remedial action support 

agency activities, which require cost 

share and must be applied for within a 

site-specific budget,’’ is deleted. The last 

sentence in this section is also deleted. 

States and Indian Tribes receiving a 

support agency Cooperative Agreement 

will no longer be required to develop an 

estimated budget for each remedial 

action site as this requirement was 

determined to be unnecessary and 

overly burdensome. However, State and 

Indian Tribe accounting systems must 

continue to track expenses by site, 

activity and operable unit as required in 

§ 35.6270. 

Section 35.6255 Cost Sharing 

This section is deleted. EPA has 

eliminated the 10 percent cost share 

requirement for remedial action support 

agency activities at EPA-lead sites 

because the costs of these activities are 

minimal. EPA will not agree to waive 

the cost share requirements under 

support agency Cooperative Agreements 

that were awarded before the effective 

date of this rule. 

Section 35.6260 Combining Cooperative 

Agreement Sites and Activities. 

The current regulation describes 

specific types of Cooperative 

Agreements. This new section 

authorizes multiple activities at both 

single and multiple sites when the 

recipient demonstrates certain 

qualifications (i.e., administrative, 

technical, and financial management 

capabilities). 

EPA will not award or amend a 

Cooperative Agreement to a political 

subdivision to conduct multiple 

activities at multiple sites. The revised 

regulation requires a single Cooperative 

Agreement for each remedial action and 

eligible removal action (i.e., a removal 

action that exceeds the statutory 

monetary ceiling or whenever a 

consistency waiver is likely to be 

sought). This approach (e.g., the 

combining of Core, pre-remedial, and 

support agency activities under a single 

Cooperative Agreement) has been used 

successfully for several years under 

EPA’s ‘‘Block Funding Administrative 

Reform.’’ 

Section 35.6270 Standards for Financial 

Management Systems 

In paragraph (a)(5), the two sentences 

are deleted and replaced with the 

following: ‘‘All support agreements will 

be assigned a single Superfund activity 

code designated specifically for support 

agency activities. All support agency 

costs, however, must be documented 

site specifically in accordance with the 

terms and conditions specified in the 

Cooperative Agreement.’’ 

Section 35.6280 Payments 

Paragraph (a)(2) is revised to crossreference the identical requirements in 

40 CFR 31.21(i), ‘‘Interest earned on 

advances.’’ The only new effect of this 

revision is that recipients will be 

allowed to keep up to $100 per year for 

administrative expenses. See the last 

sentence of 40 CFR 31.21(i). 

Section 35.6285 Recipient Payment of 

Response Costs 

Changes to this section include: 

In paragraph (c)(1), the phrase ‘‘as 

defined in CERCLA section 101(24), that 

are consistent with the permanent 

remedy at the site,’’ is added after the 

phrase ‘‘remedial action’’ to clarify the 

scope of activities that may be eligible 

for a State credit. 

In paragraph (c)(1)(ii), the text is 

revised to indicate that after a site is 

listed on the NPL, the State may be 

eligible for credit only if the State 

initiated the remedial action after 

obtaining EPA’s written approval. 

In paragraph (c)(2), the phrase 

‘‘Expenditures incurred before a site is 

listed on the NPL’’ is deleted because 

the credit submission requirements are 

the same whether the expenses were 

incurred before or after listing. 

Paragraph (c)(2)(ii) is deleted because 

the requirement is addressed under 

(c)(1)(ii). 

The title of paragraph (c)(4) is 

changed from ‘‘Credit verification’’ to 

‘‘Credit verification procedures.’’ To 

ensure a timely review of State credits, 

the regulation is modified to permit a 

financial review as an alternative to an 

audit. 

The title of paragraph (d) is changed 

from ‘‘Over match’’ to ‘‘Excess cash cost 

share contributions/over match’’. The 

revised paragraph gives the State the 

option of directing EPA to return the 

excess funds or to use the over match at 

one site to meet the cost share 

obligations at another site. 

Section 35.6290 Program Income 

A new sentence is added that states, 

‘‘Recoveries of Federal cost share 

amounts are not program income, and 

whether such recoveries are received 

before or after expiration of the 

Cooperative Agreement, must be 

reimbursed promptly to EPA.’’ 

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24500 Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 

Section 35.6305 Obtaining Supplies 

In the second sentence, the phrase, 

‘‘in the above listed sections’’, is 

replaced with, ‘‘§ § 35.6300, 35.6315(b), 

35.6325 through 35.6340, and 35.6350’’. 

Section 35.6400 Acquisition and 

Transfer of Interest 

The following changes are made 

under paragraph (a)(2): 

In the first sentence, the phrase, ‘‘or 

Indian Tribes to the extent of its legal 

authority,’’ is deleted. In the second 

sentence, the phrase, ‘‘and Indian 

Tribe,’’ and the phrase, ‘‘and 

35.6110(b)(2) respectively,’’ are deleted. 

CERCLA section 104(j) does not require 

an Indian Tribe to provide assurances 

for real property. 

In the first sentence, the phrase ‘‘of 

the NCP’’ is appended to the citation: 40 

CFR 300.510(f). 

Section 35.6500 General Requirements 

Under paragraph (b), the ‘‘$25,000’’ 

limit is changed to ‘‘the simplified 

acquisition threshold.’’ 

Section 35.6550 Procurement System 

Standards 

Paragraphs (a)(1) through (a)(3) are 

replaced with a reference to 40 CFR 

31.36(a), and for States, a list of the 

eight additional subpart O procurement 

paragraphs and sections with which a 

State recipient must comply. The last 

sentence of this revised paragraph lists 

the procurement requirements for 

political subdivisions and Indian Tribes. 

Paragraphs (a)(4) through (a)(12) are 

resequenced (a)(2) through (a)(10). 

Section 35.6555 Competition 

Paragraph (b)(2) is revised to read: 

‘‘Any contract or subcontract awarded 

by an Indian Tribe or Indian intertribal 

consortium shall comply with the 

requirements of 40 CFR 31.38, ‘Indian 

Self Determination Act’.’’ The latter 

regulation, added to 40 CFR part 31 on 

January 19, 2001 (66 FR 3794), requires 

Indian Tribes and consortia to provide, 

to the extent feasible, employment 

preferences and training opportunities 

to Indians in connection with the 

administration of contracts and 

subcontracts under Federal financial 

assistance. In addition, award 

preferences are to be provided for 

Indian organizations and Indian-owned 

economic enterprises. 

Section 35.6560 Master List of Debarred, 

Suspended, and Voluntarily Excluded 

Persons. 

This section is removed. The text of 

the current § 35.6560 is revised to 

provide updated references to EPA’s 

codifications of the Government-wide 

debarment and suspension rules and 

drug-free workplace rules; the revised 

section is retitled, ‘‘Requirements for 

both applicants and recipients’’, and 

renumbered as § 35.6020. Conforming 

amendments are made to crossreferences appearing in § §

35.6550(a)(6) and 35.6610(a). 

Section 35.6565 Procurement Methods 

In paragraph (a), the ‘‘$25,000’’ limit 

is changed to the ‘‘simplified 

acquisition threshold’’. 

Section 35.6585 Cost and Price Analysis 

In paragraph (a)(1), the ‘‘$25,000’’ 

limit is changed to the ‘‘simplified 

acquisition threshold’’. 

Section 35.6590 Bonding and Insurance 

Paragraph (b) is deleted because the 

Agency’s comprehensive guidelines on 

CERCLA section 119(c) indemnification 

are set forth in ‘‘Superfund Response 

Action Contractor Indemnification,’’ 58 

FR 5972 (January 25, 1993). These 

guidelines provide that, in general, the 

Agency will not offer to indemnify 

response action contractors. 

The current paragraph (c) is 

resequenced to paragraph (b). 

Section 35.6595 Contract Provisions 

Paragraph (b)(1) is amended by 

deleting the reference to the 1975 

enactment of the Energy Policy 

Conservation Act and substituting a 

reference to the U.S. Department of 

Energy’s regulations governing State 

energy conservation programs. 

Paragraph (b)(2), entitled ‘‘Violating 

facilities’’, of § 35.6595 is deleted 

because it refers to the Agency’s former 

regulations on Clean Air Act and Clean 

Water Act disqualifications, which were 

codified at 40 CFR part 15. Those 

statutory disqualifications and the 

procedures for reinstatement have been 

governed, since November 26, 2003 (68 

FR 66544, 66620, 66622) by subpart J of 

40 CFR part 32, ‘‘Government-wide 

Debarment and Suspension 

(Nonprocurement); and Statutory 

Disqualification Under the Clean Air 

Act and Clean Water Act.’’ The 40 CFR 

part 32 regulations apply to all EPA 

covered non-procurement transactions, 

including those under 40 CFR part 35 

subpart O. 

Paragraph (b)(3) is resequenced to 

(b)(2). Paragraph (b)(4) is resequenced to 

paragraph (b)(3) and revised to read, 

‘‘The recipient must comply with the 

requirements of 40 CFR 31.36(i)(3) 

through (6).’’ The cross-referenced part 

31 provisions specify the identical equal 

employment opportunity and labor 

requirements prescribed in paragraph 

(b)(3). The only effect of this revision is 

to eliminate the requirement that 

recipients include a copy of the obsolete 

EPA Form 5720–4 in each construction 

contract. 

Paragraph (c), containing a 

requirement that recipient contracts 

include the model clauses described in 

40 CFR 33.1030 (1987), is removed 

because 40 CFR part 33, ‘‘Procurement 

under Assistance Agreements,’’ was 

removed in 1996 (61 FR 6067). 

Section 35.6650 Progress Reports 

The section title is changed from 

‘‘Quarterly Progress Reports’’ to 

‘‘Progress Reports.’’ 

Paragraph (a) is revised to read, ‘‘The 

recipient must submit progress reports 

as specified in the Cooperative 

Agreement. Progress reports will be 

required no more frequently than 

quarterly, and will be required at least 

annually. The reports shall be due 

within 30 days after the reporting 

period. The final progress report shall 

be due 90 days after expiration or 

termination of the Cooperative 

Agreement.’’ In paragraph (b), the word 

‘‘quarterly’’ is deleted. 

Section 35.6665 Procurement Report 

Paragraph (a) is removed. The 

Department of Labor reports are no 

longer used. 

Section 35.6700 Project Records 

In paragraph (d)(ii)(2), the ‘‘$25,000’’ 

limit is changed to the ‘‘simplified 

acquisition threshold.’’ 

Section 35.6705 Records Retention 

The title of paragraph (c) is changed 

from the current ‘‘Substitution of 

microform’’ to ‘‘Substitution of an 

unalterable electronic format.’’ The first 

sentence of the revised paragraph (c) 

authorizes recipients to substitute 

original records with copies in an 

unalterable electronic format that is 

acceptable to EPA. The second sentence 

requires that such copies be produced in 

accordance with the Federal records 

requirements of 36 CFR parts 1220 

through 1234 and with EPA records 

management requirements. 

Section 35.6780 Closeout 

EPA has a continuing interest in the 

effectiveness of completed remedies. 

Therefore, paragraph (c) is added, which 

states, ‘‘After closeout, EPA may 

monitor the recipient’s compliance with 

the assurance to provide all future 

operation and maintenance as required 

under CERCLA section 104(c) and 

addressed in 40 CFR 300.510(c)(1) of the 

NCP.’’ 

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Section 35.6800 Superfund State 

Contract 

The title of this section is changed 

from ‘‘General’’ to ‘‘Superfund State 

Contract.’’ The introductory paragraph 

is rewritten to clarify that the primary 

purpose of the Superfund State Contract 

(SSC) is to ensure State and Tribal 

involvement and to obtain State 

assurances before EPA can fund 

remedial actions pursuant to section 104 

of CERCLA. The SSC may also be 

utilized to document other response 

actions and third-party involvement. 

Section 35.6805 Content of an SSC 

Several changes are made to this 

section. 

In paragraph (i)(1), the second 

sentence, ‘‘The State’s responsibility for 

operation and maintenance generally 

begins when EPA determines that the 

remedy is operational and functional or 

one year after construction completion, 

whichever is sooner (See, 40 CFR 

300.435(f)),’’ is added to clarify when 

the State’s responsibility for operation 

and maintenance begins. 

In paragraph (i)(4), the sentence, ‘‘An 

Indian Tribe must provide assurances 

pursuant to § 35.6100(b)(2),’’ is deleted. 

Indian Tribes are not required to 

provide real property assurances under 

CERLCA section 104(j). 

In paragraph (j)(3), the phrase, ‘‘Final 

payment must be made by completion 

of all activities in the site-specific 

Statement of Work,’’ is replaced with 

the phrase, ‘‘Upon completion of 

activities in the site-specific Statement 

of Work, EPA shall invoice the State for 

its final payment.’’ 

The title of paragraph (q) is changed 

from ‘‘Joint inspection of the remedy’’ 

to, ‘‘Final inspection of remedy.’’ The 

sentences under this paragraph are 

deleted and replaced with the sentence, 

‘‘The SSC must include a statement that 

following completion of the remedial 

action, the State and EPA shall jointly 

inspect the project to determine that the 

remedy is functioning properly and is 

performing as designed.’’ 

In paragraph (v), the phrase, ‘‘out-ofIndian-Tribal jurisdiction,’’ is replaced 

with the phrase, ‘‘out-of-an-IndianTribal-area-of-Indian-country.’’ 

Section 35.6815 Administrative 

Requirements 

Under paragraph (a)(1), the sentence, 

‘‘The State or political subdivision must 

make payments during the course of the 

site-specific project and must complete 

payments by completion of activities in 

the site-specific Statement of Work,’’ is 

deleted. The requirement is under §

35.6805(j)(3). The sentence, ‘‘See §

35.6255 of this subpart for requirements 

concerning cost sharing under a support 

agency Cooperative Agreement,’’ is 

deleted. Section 35.6255 is deleted in 

this revision. 

Under paragraph (c)(2), the word 

‘‘quarterly’’ modifying ‘‘progress report’’ 

is deleted. 

Section 35.6820 Conclusion of the SSC 

Paragraphs (a) through (c) are 

resequenced (a)(1) through (a)(3). In the 

revised paragraph (a)(3), the sentence 

‘‘undertake responsibility for O&M, and, 

if applicable, accept transfer in real 

property (See § 35.6805(i)(4))’’ is 

deleted and replaced with paragraph 

(a)(4), containing the language, ‘‘Assume 

responsibility for all future operation 

and maintenance as required by 

CERCLA section 104(c) and addressed 

in 40 CFR 300.510 (c)(1) of the NCP, and 

if applicable, accept transfer of any 

Federal interest in real property (See §

35.6805(i)(4)).’’ 

A new paragraph (b) is added to this 

section that states, ‘‘After the 

administrative conclusion of the 

Superfund State Contract, EPA may 

monitor the signatory’s compliance with 

assurances to provide all future 

operation and maintenance as required 

by CERCLA section 104(c) and 

addressed in 40 CFR 300.510 (c)(1) of 

the NCP.’’ 

These changes are made to help 

ensure long-term requirements for 

operation and maintenance and certain 

institutional controls remain in effect 

even after the Superfund State Contract 

expires. 

VI. Statutory and Executive Order 

Reviews 

A. Executive Order 12866: Regulatory 

Planning and Reviews 

Under Executive Order (EO) 12866 

(58 FR 51735, October 4, 1993), this 

action is a ‘‘significant regulatory 

action.’’ Accordingly, EPA submitted 

this action to the Office of Management 

and Budget (OMB) for review. Any 

changes made in response to OMB 

recommendations have been 

documented in the docket for this 

action. 

B. Paperwork Reduction Act 

The Office of Management and Budget 

(OMB) has approved the information 

collection requirements contained in 

this rule under the provisions of the 

Paperwork Reduction Act, 44 U.S.C. 

3501 et seq. and has assigned OMB 

control number 2050–0179. 

This ICR authorizes the collection of 

information under 40 CFR part 35, 

subpart O, which establishes the 

administrative requirements for 

Cooperative Agreements funded under 

CERCLA for State, political 

subdivisions, and federally recognized 

Indian Tribal government response 

actions. This regulation also codifies the 

administrative requirements for 

Superfund State Contracts for non-Statelead remedial responses. This regulation 

includes only those provisions 

mandated by CERCLA, required by 

OMB Circulars, or added by EPA to 

ensure sound and effective financial 

assistance management. The 

information is collected from applicants 

and/or recipients of EPA assistance and 

is used to make awards, pay recipients, 

and collect information on how Federal 

funds are being spent. EPA requires this 

information to meet its Federal 

stewardship responsibilities. Recipient 

responses are required to obtain a 

benefit (Federal funds) under 40 CFR 

part 31, Uniform Administrative 

Requirements for Grants and 

Cooperative Agreements to State and 

Local Governments and under 40 CFR 

part 35, State and Local Assistance. This 

rule does not contain any collection of 

information requirements beyond those 

already approved. It is estimated there 

will be approximately 654 respondents, 

with an average hourly burden per 

response of 7.75 hours per response. 

This provides an estimated overall 

annual burden to State, local or Tribal 

governments of 5073 hours. There are 

no estimated capital or operations and 

maintenance costs associated with this 

grant rule. Burden means the total time, 

effort, or financial resources expended 

by persons to generate, maintain, retain, 

disclose or provide information to or for 

a Federal agency. This includes the time 

needed to review instructions; develop, 

acquire, install, and utilize technology 

and systems for the purposes of 

collecting, validating, and verifying 

information, processing and 

maintaining information, and disclosing 

and providing information; adjust the 

existing ways to comply with any 

previously applicable instructions and 

requirements; train personnel to be able 

to respond to a collection of 

information; search data sources; 

complete and review the collection of 

information; and transmit or otherwise 

disclose the information. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to a collection of information 

unless it displays a currently valid OMB 

control number. The OMB control 

numbers for EPA’s regulations in 40 

CFR are listed in 40 CFR part 9. In 

addition, EPA is amending the table in 

40 CFR part 9 of currently approved 

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24502 Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 

OMB control numbers for various 

regulations to list the regulatory 

citations for the information 

requirements contained in this final 

rule. 

C. Regulatory Flexibility Act 

Today’s final rule is not subject to the 

Regulatory Flexibility Act (RFA), which 

generally requires an agency to prepare 

a regulatory flexibility analysis for any 

rule that will have a significant 

economic impact on a substantial 

number of small entities. The RFA 

applies only to rules subject to notice 

and comment rulemaking requirements 

under the Administrative Procedure Act 

(APA) or any other statute. This rule is 

not subject to notice and comment 

requirements under the APA or any 

other statute because this rule pertains 

to grants which the APA expressly 

exempts from notice and comment 

rulemaking requirements under 5 U.S.C. 

553(a)(2). Moreover, CERCLA also does 

not require EPA to issue a notice of 

proposed rulemaking prior to issuing 

this rule. The Agency has determined 

that this rule does not adversely impact 

small entities. 

D. Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA), Public 

Law 104–4, establishes requirements for 

Federal Agencies to assess the effects of 

their regulatory actions on State, local, 

and Tribal governments and the private 

sector. Under section 202 of the UMRA, 

Federal agencies generally must prepare 

a written analysis, including a costbenefit analysis, for proposed and final 

rules with ‘‘Federal mandates’’ that may 

result in expenditures to State, local and 

Tribal governments, in the aggregate, or 

to the private sector, of $100 million or 

more in any one year. Moreover, section 

205 allows Federal agencies to adopt an 

alternative other than the least costly, 

most cost-effective or least burdensome 

alternative if the Administrator 

publishes with the final rule an 

explanation why that alternative was 

not adopted. Before promulgating a rule 

for which a written statement is needed, 

section 205 of the UMRA requires 

Federal agencies to identify and 

consider a reasonable number of 

regulatory alternatives and adopt the 

least costly, most cost-effective, or least 

burdensome alternative that achieves 

the objectives of the rule. The 

provisions of section 205 do not apply 

when they are inconsistent with 

applicable law. Before a Federal agency 

establishes any regulatory requirements 

that may significantly or uniquely affect 

small governments, including Tribal 

governments, it must have developed, 

under section 203 of the UMRA, a small 

government agency plan. The plan must 

provide for notifying potentially 

affected small governments, enabling 

officials to have meaningful and timely 

input in the development of regulatory 

proposals, and informing, educating and 

advising small governments on 

compliance with the regulatory 

requirements. 

This final rule does not include 

Federal mandates that may result in 

expenditures of $100 million or more to 

State, local, or Tribal governments in 

the aggregate, because the UMRA 

generally excludes from the definition 

of ‘‘Federal intergovernmental mandate’’ 

duties that arise from participation in a 

voluntary Federal program. States are 

not legally required to have or maintain 

a CERCLA authorized program. 

Therefore, today’s final rule is not 

subject to the requirements of sections 

202 or 205 of UMRA. EPA has 

determined that this rule contains no 

regulatory requirements that might 

significantly or uniquely affect small 

governments, because participation by 

small governments in this program is 

voluntary and is funded by EPA. 

E. Executive Order 13132: Federalism 

Executive Order 13132, entitled 

‘‘Federalism’’ (64 FR 43255, August 10, 

1999), requires Federal agencies to 

develop an accountable process to 

ensure ‘‘meaningful and timely input by 

State and local officials in the 

development of regulatory policies that 

have federalism implications.’’ The 

Executive Order defines ‘‘policies that 

have federalism implications’’ to 

include regulations that have 

‘‘substantial direct effects on the States, 

on the relationship between the national 

government and the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government.’’ This final rule 

does not have federalism implications. 

It does not have substantial direct 

effects on the States, on the relationship 

between the national government and 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government, as 

specified in Executive Order 13132. 

This final rule mainly makes minor 

changes to the regulation, under which 

the program has been operating since 

June, 1990. Apart from the minor 

changes, this rule adds new provisions 

that increase State flexibility, so it does 

not have federalism implications as that 

phrase is defined for purposes of 

Executive Order 13132. Further, because 

this is a rule that primarily conditions 

the use of Federal assistance, it does not 

impose substantial direct compliance 

costs on States. 

EPA did consult with representatives 

of State governments in developing this 

rule. Specifically, State representatives 

have been participating members of the 

workgroup revising this rule throughout 

the entire process, and were given the 

opportunity to review and comment on 

drafts of this rule. Representatives from 

two States (Kansas and Illinois) were 

selected to participate in the work group 

meetings, and these States discussed 

rule options and draft rule language 

with EPA throughout the development 

of the rule. Also, the draft rule was 

provided to the Association of State and 

Territorial Solid Waste Management 

Officials. 

F. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

Executive Order 13175, entitled 

‘‘Consultation and Coordination with 

Indian Tribal Governments’’ (65 FR 

67249, November 9, 2000), requires EPA 

to develop an accountable process to 

ensure ‘‘meaningful and timely input by 

Tribal officials in the development of 

regulatory policies that have Tribal 

implications.’’ Although this rule will 

have Tribal implications, it will not 

impose substantial direct compliance 

costs on Tribal governments, preempt 

Tribal law, or establish Federal 

standards. The Agency consulted with 

Tribes under its EPA Indian Policy, and 

in light of CERCLA sections 121 and 126 

providing that Indian Tribes should 

have ‘‘substantial and meaningful 

involvement’’ in Superfund. 

EPA has consulted with Tribal 

officials early in the process of 

developing this regulation to permit 

them to have meaningful and timely 

input into its development. During the 

early deliberations on the revisions to 

this rule, a Tribal representative was 

actively involved in the regulatory 

workgroup, and helped identify issues 

of likely concern to Tribal governments. 

EPA, in turn, discussed those issues 

with Tribal representatives participating 

in a concurrent initiative to enhance the 

State and Tribal roles in Superfund. 

And the rule was informed to a large 

extent by the experiences of Tribes and 

EPA during 16 years of experience 

working under the old regulation. 

Ultimately, the EPA regulatory 

workgroup used the knowledge gained 

from consultation and experience to 

identify and incorporate beneficial 

changes for Tribes into the regulation. 

The principal changes (discussed 

further in section IV), were (a) to waive 

the cost share requirement for Tribes 

receiving Core Program and support 

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Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 24503 

agency Cooperative Agreement, (b) to 

eliminate requirements to show 

jurisdiction for all Core agreements and 

most support agency agreements, and (c) 

to include intertribal consortia as 

eligible entities to receive Cooperative 

Agreements. After drafting this 

regulation, EPA solicited input from all 

the federally recognized Indian Tribes 

and the National Tribal Environmental 

Council by mailing a summary 

explaining the Tribal portions of the 

revised subpart O regulation. Most 

recently, the Agency also discussed the 

proposed changes and solicited direct 

feedback from Indian Tribes at the 11th 

Annual Conference, ‘‘Community 

Environmental Stewardship for the 

Future,’’ sponsored by the Inter-Tribal 

Environmental Council (ITEC). 

As required by section 7(a), EPA’s 

Tribal Consultation Official has certified 

that the requirements of the Executive 

Order have been met in a meaningful 

and timely manner. A copy of the 

certification is included in the docket 

for this rule. 

G. Executive Order 13045: Protection of 

Children From Environmental Health 

and Safety Risks 

Executive Order 13045, ‘‘Protection of 

Children from Environmental Health 

Risks and Safety Risks’’ (62 FR 19885, 

April 23, 1997), applies to any rule that: 

(1) Is determined to be ‘‘economically 

significant’’ as defined under Executive 

Order 12866, and (2) concerns an 

environmental health or safety risk that 

EPA has reason to believe may have a 

disproportionate effect on children. If 

the regulatory action meets both criteria, 

the Agency must evaluate the 

environmental health or safety effects of 

the planned rule on children, and 

explain why the planned regulation is 

preferable to other potentially effective 

and reasonably feasible alternatives 

considered by the Agency. This final 

rule is not subject to Executive Order 

13045 because it is not ‘‘economically 

significant’’ as defined under Executive 

Order 12866. Further, it does not 

concern an environmental health or 

safety risk that EPA has reason to 

believe may have a disproportionate 

effect on children. 

H. Executive Order 13211 (Energy 

Effects) 

This rule is not a ‘‘significant energy 

action’’ as defined in Executive Order 

13211, ‘‘Actions Concerning Regulations 

That Significantly Affect Energy Supply, 

Distribution, or Use’’ (66 FR 28355 (May 

22, 2001)) because it is not likely to 

have a significant adverse effect on the 

supply, distribution, or use of energy. 

Further, we have concluded that this 

rule is not likely to have any adverse 

energy effects. 

I. National Technology Transfer and 

Advancement Act 

Section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (‘‘NTTAA’’), Public Law 

104–113, section 12(d) (15 U.S.C. 272 

note) directs EPA to use voluntary 

consensus standards in its regulatory 

activities unless to do so would be 

inconsistent with applicable law or 

otherwise impractical. Voluntary 

consensus standards are technical 

standards (e.g., materials specifications, 

test methods, sampling procedures, and 

business practices) that are developed or 

adopted by voluntary consensus 

standards bodies. The NTTAA directs 

EPA to provide Congress, through OMB, 

explanations when the Agency decides 

not to use available and applicable 

voluntary consensus standards. This 

action does not involve technical 

standards. Therefore, EPA did not 

consider the use of any voluntary 

consensus standards. 

J. Executive Order 12898: Federal 

Actions to Address Environmental 

Justice in Minority Populations and 

Low-Income Populations 

Under Executive Order 12898, 

‘‘Federal Actions to Address 

Environmental Justice in Minority 

Populations and Low-Income 

Populations,’’ as well as through EPA’s 

National Environmental Justice 

Advisory Council, EPA has undertaken 

to incorporate environmental justice 

into its policies and programs. EPA is 

committed to addressing environmental 

justice concerns, and is assuming a 

leadership role in environmental justice 

initiatives to enhance environmental 

quality for all residents of the United 

States. The Agency’s goals are to ensure 

that no segment of the population, 

regardless of race, color, national origin, 

or income, bears disproportionately 

high and adverse human health and 

environmental effects as a result of 

EPA’s policies, programs, and activities, 

and all people live in clean and 

sustainable communities. No action 

from this rule will have a 

disproportionately high and adverse 

human health and environmental effect 

on any segment of the population. In 

addition, this rule does not impose 

substantial direct compliance costs on 

those communities. Accordingly, the 

rule does not raise issues regarding 

Executive Order 12898. 

K. Congressional Review Act 

The Congressional Review Act, 5 

U.S.C. 801 et seq., as added by the Small 

Business Regulatory Enforcement 

Fairness Act of 1996, generally provides 

that before a rule may take effect, the 

agency promulgating the rule must 

submit a rule report, which includes a 

copy of the rule, to each House of the 

Congress and to the Comptroller General 

of the United States. EPA will submit a 

report containing this rule and other 

required information to the U.S. Senate, 

the U.S. House of Representatives, and 

the Comptroller General of the United 

States prior to publication of the rule in 

the Federal Register. A major rule 

cannot take effect until 60 days after it 

is published in the Federal Register. 

This action is not a ‘‘major rule’’ as 

defined by 5 U.S.C. 804(2). The subpart 

O regulation is effective July 2, 2007. 

List of Subjects 

40 CFR Part 9 

Environmental protection, Reporting 

and recordkeeping requirements. 

40 CFR Part 35 

Administrative practices and 

procedures, Environmental protection, 

Grant programs-environmental 

protection, Reporting and 

recordkeeping. 

Dated: April 19, 2007. 

Stephen L. Johnson, 

Administrator. 

■ For the reasons set out in the 

preamble, 40 CFR parts 9 and 35 are 

amended as follows: 

PART 9—[AMENDED] 

■ 1. The authority citation for part 9 

continues to read as follows: 

Authority: 7 U.S.C. 135 et seq., 136–136y; 

15 U.S.C. 2001, 2003, 2005, 2006, 2601–2671; 

21 U.S.C. 331j, 346a, 348; 31 U.S.C. 9701; 33 

U.S.C. 1251 et seq., 1311, 1313d, 1314, 1318, 

1321, 1326, 1330, 1342, 1344, 1345 (d) and 

(e), 1361; E.O. 11735, 38 FR 21243, 3 CFR, 

1971–1975 Comp. p. 973; 42 U.S.C. 241, 

242b, 243, 246, 300f, 300g, 300g–1, 300g–2, 

300g–3, 300g–4, 300g–5, 300g–6, 300j–1, 

300j–2, 300j–3, 300j–4, 300j–9, 1857 et seq., 

6901–6992k, 7401–7671q, 7542, 9601–9657, 

11023, 11048. 

■ 2. In § 9.1, the table is amended under 

the heading, ‘‘State and Local 

Assistance,’’ as follows: 

■ a. By revising entries for 

‘‘35.6055(a)(2)’’, ‘‘35.6055(b)(1)’’, 

‘‘35.6055(b)(2)(i)–(ii)’’, 

‘‘35.6105(a)(2)(i)–(v), (vii)’’, ‘‘35.6120’’, 

‘‘35.6145’’, ‘‘35.6155(a), (c)’’, 

‘‘35.6230(a), (c)’’, ‘‘35.6300(a)(3)’’, 

‘‘35.6315(c)’’, ‘‘35.6320’’, ‘‘35.6340(a)’’, 

‘‘35.6350’’, ‘‘35.6500’’, 

‘‘35.6550(b)(1)(iii)’’, ‘‘35.6550(b)(2)(i)’’, 

‘‘35.6585’’, ‘‘35.6595(a), (b)’’, 

‘‘35.6600(a)’’, ‘‘35.6650’’, ‘‘35.6655’’, 

‘‘35.6660’’, ‘‘35.6665(a), (b)’’, ‘‘35.6700’’, 

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24504 Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 

‘‘35.6705’’, ‘‘35.6710’’, ‘‘35.6805’’, and 

‘‘35.6815(a), (c), (d)’’. 

■ b. By removing entries for 

‘‘35.6110(b)(2)’’ and ‘‘35.6550(a)(1)(ii)’’. 

§ 9.1 OMB approvals under the Paperwork 

Reduction Act. 

* * * * * 

40 CFR citation OMB 

control No. 

* * * * * 

State and Local Assistance 

35.6055(a)(2) ............................ 2050–0179 

35.6055(b)(1) ............................ 2050–0179 

35.6055(b)(2)(i)–(ii) ................... 2050–0179 

35.6105(a)(2)(i)–(v), (vii) ........... 2050–0179 

35.6120 ..................................... 2050–0179 

35.6145 ..................................... 2050–0179 

35.6155(a), (c) .......................... 2050–0179 

35.6230(a), (c) .......................... 2050–0179 

35.6300(a)(3) ............................ 2050–0179 

35.6315(c) ................................. 2050–0179 

35.6320 ..................................... 2050–0179 

35.6340(a) ................................ 2050–0179 

35.6350 ..................................... 2050–0179 

35.6500 ..................................... 2050–0179 

35.6550(b)(1)(iii) ....................... 2050–0179 

35.6550(b)(2)(i) ......................... 2050–0179 

35.6585 ..................................... 2050–0179 

35.6595(a), (b) .......................... 2050–0179 

35.6600(a) ................................ 2050–0179 

35.6650 ..................................... 2050–0179 

35.6655 ..................................... 2050–0179 

35.6660 ..................................... 2050–0179 

35.6665(a), (b) .......................... 2050–0179 

35.6700 ..................................... 2050–0179 

35.6705 ..................................... 2050–0179 

35.6710 ..................................... 2050–0179 

35.6805 ..................................... 2050–0179 

35.6815(a), (c), (d) ................... 2050–0179 

* * * * * 

* * * * * 

PART 35—[AMENDED] 

■ 3. Subpart O is revised to read as 

follows: 

Subpart O—Cooperative Agreements and 

Superfund State Contracts for Superfund 

Response Actions 

General 

Sec. 

35.6000 Authority. 

35.6005 Purpose and scope. 

35.6010 Indian Tribe and intertribal 

consortium eligibility. 

35.6015 Definitions. 

35.6020 Requirements for both applicants 

and recipients. 

35.6025 Deviation from this subpart. 

Pre-Remedial Response Cooperative 

Agreements 

35.6050 Eligibility for pre-remedial 

Cooperative Agreements. 

35.6055 State-lead pre-remedial Cooperative 

Agreements. 

35.6060 Political subdivision-lead preremedial Cooperative Agreements. 

35.6070 Indian Tribe-lead pre-remedial 

Cooperative Agreements. 

Remedial Response Cooperative Agreements 

35.6100 Eligibility for remedial Cooperative 

Agreements. 

35.6105 State-lead remedial Cooperative 

Agreements. 

35.6110 Indian Tribe-lead remedial 

Cooperative Agreements. 

35.6115 Political subdivision-lead remedial 

Cooperative Agreements. 

35.6120 Notification of the out-of-State or 

out-of-an-Indian-Tribal-area-of-Indiancountry transfer of CERCLA waste. 

Enforcement Cooperative Agreements 

35.6145 Eligibility for enforcement 

Cooperative Agreements. 

35.6150 Activities eligible for funding under 

enforcement Cooperative Agreements. 

35.6155 State, political subdivisions or 

Indian Tribe-lead enforcement 

Cooperative Agreements. 

Removal Response Cooperative Agreements 

35.6200 Eligibility for removal Cooperative 

Agreements. 

35.6205 Removal Cooperative Agreements. 

Core Program Cooperative Agreements 

35.6215 Eligibility for Core Program 

Cooperative Agreements. 

35.6220 General. 

35.6225 Activities eligible for funding under 

Core Program Cooperative Agreements. 

35.6230 Application requirements. 

35.6235 Cost sharing. 

Support Agency Cooperative Agreements 

35.6240 Eligibility for support agency 

Cooperative Agreements. 

35.6245 Allowable activities. 

35.6250 Support agency Cooperative 

Agreement requirements. 

Combining Cooperative Agreements 

35.6260 Combining Cooperative Agreement 

sites and activities. 

Financial Administration Requirements 

Under a Cooperative Agreement 

35.6270 Standards for financial management 

systems. 

35.6275 Period of availability of funds. 

35.6280 Payments. 

35.6285 Recipient payment of response costs. 

35.6290 Program income. 

Personal Property Requirements Under a 

Cooperative Agreement 

35.6300 General personal property 

acquisition and use requirements. 

35.6305 Obtaining supplies. 

35.6310 Obtaining equipment. 

35.6315 Alternative methods for obtaining 

property. 

35.6320 Usage rate. 

35.6325 Title and EPA interest in CERCLAfunded property. 

35.6330 Title to federally owned property. 

35.6335 Property management standards. 

35.6340 Disposal of CERCLA-funded 

property. 

35.6345 Equipment disposal options. 

35.6350 Disposal of federally owned 

property. 

Real Property Requirements Under a 

Cooperative Agreement 

35.6400 Acquisition and transfer of interest. 

35.6405 Use. 

Copyright Requirements Under a 

Cooperative Agreement 

35.6450 General requirements. 

Use of Recipient Employees (‘‘Force 

Account’’) Under a Cooperative Agreement 

35.6500 General requirements. 

Procurement Requirements Under a 

Cooperative Agreement 

35.6550 Procurement system standards. 

35.6555 Competition. 

35.6565 Procurement methods. 

35.6570 Use of the same engineer during 

subsequent phases of response. 

35.6575 Restrictions on types of contracts. 

35.6580 Contracting with minority and 

women’s business enterprises (MBE/ 

WBE), small businesses, and labor 

surplus area firms. 

35.6585 Cost and price analysis. 

35.6590 Bonding and insurance. 

35.6595 Contract provisions. 

35.6600 Contractor claims. 

35.6605 Privity of contract. 

35.6610 Contracts awarded by a contractor. 

Reports Required Under a Cooperative 

Agreement 

35.6650 Progress reports. 

35.6655 Notification of significant 

developments. 

35.6660 Property inventory reports. 

35.6665 Procurement report. 

35.6670 Financial reports. 

Records Requirements Under a Cooperative 

Agreement 

35.6700 Project records. 

35.6705 Records retention. 

35.6710 Records access. 

Other Administrative Requirements for 

Cooperative Agreements 

35.6750 Modifications. 

35.6755 Monitoring program performance. 

35.6760 Enforcement and termination for 

convenience. 

35.6765 Non-Federal audit. 

35.6770 Disputes. 

35.6775 Exclusion of third-party benefits. 

35.6780 Closeout. 

35.6785 Collection of amounts due. 

35.6790 High risk recipients. 

Requirements for Administering a 

Superfund State Contract (SSC) 

35.6800 Superfund State Contract. 

35.6805 Contents of an SSC. 

35.6815 Administrative requirements. 

35.6820 Conclusion of the SSC. 

Authority: 42 U.S.C. 9601 et seq. 

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Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 24505 

Subpart O—Cooperative Agreements 

and Superfund State Contracts for 

Superfund Response Actions 

General 

§ 35.6000 Authority. 

This subpart is issued under section 

104(a) through (j) of the Comprehensive 

Environmental Response, 

Compensation, and Liability Act of 

1980, as amended (CERCLA)(42 U.S.C. 

9601 et seq.). 

§ 35.6005 Purpose and scope. 

(a) This subpart codifies recipient 

requirements for administering 

Cooperative Agreements awarded 

pursuant to section 104(d)(1) of 

CERCLA. This subpart also codifies 

requirements for administering 

Superfund State Contracts (SSCs) for 

non-State-lead remedial responses 

undertaken pursuant to section 104 of 

CERCLA. 

(b) 40 CFR part 31, ‘‘Uniform 

Administrative Requirements for Grants 

and Cooperative Agreements to State 

and Local Governments,’’ establishes 

consistency and uniformity among 

Federal agencies in the administration 

of grants and Cooperative Agreements to 

State, local, and Indian Tribal 

governments. For CERCLA-funded 

Cooperative Agreements, this subpart 

supplements the requirements 

contained in part 31 for States, political 

subdivisions thereof, and Indian Tribes. 

This subpart references those sections of 

part 31 that are applicable to CERCLAfunded Cooperative Agreements. 

(c) Superfund monies for remedial 

actions cannot be used by recipients for 

Federal facility cleanup activities. When 

a cleanup is undertaken by another 

Federal entity, the State, political 

subdivision or Indian Tribe can pursue 

funding for its involvement in response 

activities from the appropriate Federal 

entity. 

§ 35.6010 Indian Tribe and intertribal 

consortium eligibility. 

(a) Indian Tribes are eligible to receive 

Superfund Cooperative Agreements 

only when they are federally 

recognized, and when they meet the 

criteria set forth in 40 CFR 300.515(b) of 

the National Oil and Hazardous 

Substances Pollution Contingency Plan 

(the National Contingency Plan or NCP), 

except that Indian Tribes shall not be 

required to demonstrate jurisdiction 

under 40 CFR 300.515(b)(3) of the NCP 

to be eligible for Core Program 

Cooperative Agreements, and those 

support agency Cooperative Agreements 

for which jurisdiction is not needed for 

the Tribe to carry out the support 

agency activities of the work plan. 

(b) Although section 126 of CERCLA 

provides that the governing body of an 

Indian Tribe shall be treated 

substantially the same as a State, the 

subpart O definition of ‘‘State’’ does not 

include Indian Tribes because they do 

not need to comply with all the 

statutory requirements addressed in 

subpart O that apply to States. 

(c) Intertribal consortium: An 

intertribal consortium is eligible to 

receive a Cooperative Agreement from 

EPA only if the intertribal consortium 

demonstrates that all members of the 

consortium meet the eligibility 

requirements for the Cooperative 

Agreement, and all members authorize 

the consortium to apply for and receive 

assistance. 

§ 35.6015 Definitions. 

(a) As used in this subpart, the 

following words and terms shall have 

the following meanings: 

Activity. A set of CERCLA-funded 

tasks that makes up a segment of the 

sequence of events undertaken in 

determining, planning, and conducting 

a response to a release or potential 

release of a hazardous substance. These 

include Core Program, pre-remedial 

(i.e., preliminary assessments and site 

inspections), support agency, remedial 

investigation/feasibility studies, 

remedial design, remedial action, 

removal, and enforcement activities. 

Allowable costs. Those project costs 

that are: Eligible, reasonable, necessary, 

and allocable to the project; permitted 

by the appropriate Federal cost 

principles; and approved by EPA in the 

Cooperative Agreement and/or 

Superfund State Contract. 

Architectural or engineering (A/E) 

services. Consultation, investigations, 

reports, or services for design-type 

projects within the scope of the practice 

of architecture or professional 

engineering as defined by the laws of 

the State or territory in which the 

recipient is located. 

Award official. The EPA official with 

the authority to execute Cooperative 

Agreements and Superfund State 

Contracts and to take other actions 

authorized by EPA Orders. 

Budget period. The length of time 

EPA specifies in a Cooperative 

Agreement during which the recipient 

may expend or obligate Federal funds. 

CERCLA. The Comprehensive 

Environmental Response, 

Compensation, and Liability Act of 

1980, as amended (42 U.S.C. 9601— 

9657). 

Change order. A written order issued 

by a recipient, or its designated agent, 

to its contractor authorizing an addition 

to, deletion from, or revision of, a 

contract, usually initiated at the 

contractor’s request. 

Claim. A demand or written assertion 

by a contractor seeking, as a matter of 

right, changes in contract duration, 

costs, or other provisions, which 

originally have been rejected by the 

recipient. 

Closeout. The final EPA or recipient 

actions taken to assure satisfactory 

completion of project work and to fulfill 

administrative requirements, including 

financial settlement, submission of 

acceptable required final reports, and 

resolution of any outstanding issues 

under the Cooperative Agreement and/ 

or Superfund State Contract. 

Community Relations Plan (CRP). A 

management and planning tool 

outlining the specific community 

relations activities to be undertaken 

during the course of a response. It is 

designed to provide for two-way 

communication between the affected 

community and the agencies 

responsible for conducting a response 

action, and to assure public input into 

the decision-making process related to 

the affected communities. 

Construction. Erection, building, 

alteration, repair, remodeling, 

improvement, or extension of buildings, 

structures or other property. 

Contract. A written agreement 

between an EPA recipient and another 

party (other than another public agency) 

or between the recipient’s contractor 

and the contractor’s first tier 

subcontractor. 

Contractor. Any party to whom a 

recipient awards a contract. 

Cooperative Agreement. A legal 

instrument EPA uses to transfer money, 

property, services, or anything of value 

to a recipient to accomplish a public 

purpose in which substantial EPA 

involvement is anticipated during the 

performance of the project. 

Core Program Cooperative Agreement. 

A Cooperative Agreement that provides 

funds to a State or Indian Tribe to 

conduct CERCLA implementation 

activities that are not assignable to 

specific sites but are intended to 

develop and maintain a State’s or Indian 

Tribe’s ability to participate in the 

CERCLA response program. 

Cost analysis. The review and 

evaluation of each element of contract 

cost to determine reasonableness, 

allocability, and allowability. 

Cost share. The portion of allowable 

project costs that a recipient contributes 

toward completing its project (i.e., nonFederal share, matching share). 

Equipment. Tangible, nonexpendable, 

personal property having a useful life of 

more than one year and an acquisition 

cost of $5,000 or more per unit. 

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Fair market value. The amount at 

which property would change hands 

between a willing buyer and a willing 

seller, neither being under any 

compulsion to buy or sell and both 

having reasonable knowledge of the 

relevant facts. Fair market value is the 

price in cash, or its equivalent, for 

which the property would have been 

sold on the open market. 

Health and safety plan. A plan that 

specifies the procedures that are 

sufficient to protect on-site personnel 

and surrounding communities from the 

physical, chemical, and/or biological 

hazards of the site. The health and 

safety plan outlines: 

(i) Site hazards; 

(ii) Work areas and site control 

procedures; 

(iii) Air surveillance procedures; 

(iv) Levels of protection; 

(v) Decontamination and site 

emergency plans; 

(vi) Arrangements for weather-related 

problems; and 

(vii) Responsibilities for 

implementing the health and safety 

plan. 

In-kind contribution. The value of a 

non-cash contribution (generally from 

third parties) to meet a recipient’s cost 

sharing requirements. An in-kind 

contribution may consist of charges for 

real property and equipment or the 

value of goods and services directly 

benefiting the CERCLA-funded project. 

Indian Tribe. As defined by section 

101(36) of CERCLA, any Indian Tribe, 

band, nation, or other organized group 

or community, including any Alaska 

Native village but not including any 

Alaska Native regional or village 

corporation, which is recognized as 

eligible for the special programs and 

services provided by the United States 

to Indians because of their status as 

Indians. For the purposes of this 

subpart, the term, ‘‘Indian Tribe,’’ 

includes an intertribal consortium 

consisting of two or more federally 

recognized Tribes. 

Intergovernmental Agreement. Any 

written agreement between units of 

government under which one public 

agency performs duties for or in concert 

with another public agency using EPA 

assistance. This includes substate and 

interagency agreements. 

Intertribal consortium. A partnership 

between two or more federally 

recognized Indian Tribes that is 

authorized by the governing bodies of 

those Indian Tribes to apply for and 

receive assistance agreements. An 

intertribal consortium must have 

adequate documentation of the 

existence of the partnership, and the 

authorization to apply for and receive 

assistance. 

Lead agency. The Federal agency, 

State agency, political subdivision, or 

Indian Tribe that has primary 

responsibility for planning and 

implementing a response action under 

CERCLA. 

Minority Business Enterprise (MBE). A 

business which is: 

(i) Certified as socially and 

economically disadvantaged by the 

Small Business Administration; 

(ii) Certified as a minority business 

enterprise by a State or Federal agency; 

or 

(iii) An independent business concern 

which is at least 51 percent owned and 

controlled by minority group 

member(s). A minority group member is 

an individual who is a citizen of the 

United States and one of the following: 

(A) Black American; 

(B) Hispanic American (with origins 

from Puerto Rico, Mexico, Cuba, South 

or Central America); 

(C) Native American (American 

Indian, Eskimo, Aleut, native 

Hawaiian); or 

(D) Asian-Pacific American (with 

origins from Japan, China, the 

Philippines, Vietnam, Korea, Samoa, 

Guam, the U.S. Trust Territories of the 

Pacific, Northern Marianas, Laos, 

Cambodia, Taiwan or the Indian 

subcontinent). 

National Priorities List (NPL). The list, 

compiled by EPA pursuant to CERCLA 

section 105, of uncontrolled hazardous 

substance releases in the United States 

that are priorities for long-term remedial 

evaluation and response. The NPL is 

published at Appendix B to 40 CFR Part 

300. 

Operable unit. A discrete action, as 

described in the Cooperative Agreement 

or Superfund State Contract, that 

comprises an incremental step toward 

comprehensively addressing site 

problems. The cleanup of a site can be 

divided into a number of operable units, 

depending on the complexity of the 

problems associated with the site. 

Operable units may address 

geographical portions of a site, specific 

site problems, or initial phases of an 

action, or may consist of any set of 

actions performed over time or any 

actions that are concurrent but located 

in different parts of a site. 

Operation and maintenance. 

Measures required to maintain the 

effectiveness of response actions. 

Personal property. Property other than 

real property. It includes both supplies 

and equipment. 

Political subdivision. The unit of 

government that the State determines to 

have met the State’s legislative 

definition of a political subdivision. 

Potentially Responsible Party (PRP). 

Any individual(s) or company(ies) 

identified as potentially liable under 

CERCLA for cleanup or payment for 

costs of cleanup of Hazardous Substance 

sites. PRPs may include individual(s), or 

company(ies) identified as having 

owned, operated, or in some other 

manner contributed wastes to 

Hazardous Substance sites. 

Price analysis. The process of 

evaluating a prospective price without 

regard to the contractor’s separate cost 

elements and proposed profit. Price 

analysis determines the reasonableness 

of the proposed contract price based on 

adequate price competition, previous 

experience with similar work, 

established catalog or market price, law, 

or regulation. 

Profit. The net proceeds obtained by 

deducting all allowable costs (direct and 

indirect) from the price. (Because this 

definition of profit is based on 

applicable Federal cost principles, it 

may vary from many firms’ definition of 

profit, and may correspond to those 

firms’ definition of ‘‘fee.’’) 

Project. The activities or tasks EPA 

identifies in the Cooperative Agreement 

and/or Superfund State Contract. 

Project manager. The recipient official 

designated in the Cooperative 

Agreement or Superfund State Contract 

as the program contact with EPA. 

Project officer. The EPA official 

designated in the Cooperative 

Agreement as EPA’s program contact 

with the recipient. Project officers are 

responsible for monitoring the project. 

Project period. The length of time 

EPA specifies in the Cooperative 

Agreement and/or Superfund State 

Contract for completion of all project 

work. It may be composed of more than 

one budget period. 

Quality Assurance Project Plan. A 

written document, associated with 

remedial site sampling, which presents 

in specific terms the organization 

(where applicable), objectives, 

functional activities, and specific 

quality assurance and quality control 

activities and procedures designed to 

achieve the data quality objectives of a 

specific project(s) or continuing 

operation(s). 

Real property. Land, including land 

improvements, structures, and 

appurtenances thereto, excluding 

movable machinery and equipment. 

Recipient. Any State, political 

subdivision thereof, or Indian Tribe 

which has been awarded and has 

accepted an EPA Cooperative 

Agreement. 

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Services. A recipient’s in-kind or a 

contractor’s labor, time, or efforts which 

do not involve the delivery of a specific 

end item, other than documents (e.g., 

reports, design drawings, 

specifications). This term does not 

include employment agreements or 

collective bargaining agreements. 

Simplified acquisition threshold. The 

dollar amount specified in the Office of 

Federal Procurement Policy Act, 41 

U.S.C. 403. The threshold is currently 

set at $100,000. 

Small business. A business as defined 

in section 3 of the Small Business Act, 

as amended (15 U.S.C. 632). 

State. The several States of the United 

States, the District of Columbia, the 

Commonwealth of Puerto Rico, Guam, 

American Samoa, the Virgin Islands, the 

Commonwealth of Northern Marianas, 

and any territory or possession over 

which the United States has 

jurisdiction. 

Statement of Work (SOW). The 

portion of the Cooperative Agreement 

application and/or Superfund State 

Contract that describes the purpose and 

scope of activities and tasks to be 

carried out as a part of the proposed 

project. 

Subcontractor. Any first tier party that 

has a contract with the recipient’s prime 

contractor. 

Superfund State Contract (SSC). A 

joint, legally binding agreement between 

EPA and another party(ies) to obtain the 

necessary assurances before an EPAlead remedial action or any political 

subdivision-lead activities can begin at 

a site, and to ensure State or Indian 

Tribe involvement as required under 

CERCLA section 121(f). 

Supplies. All tangible personal 

property other than equipment as 

defined in this section. 

Support agency. The agency that 

furnishes necessary data to the lead 

agency, reviews response data and 

documents, and provides other 

assistance to the lead agency. 

Task. An element of a Superfund 

response activity identified in the 

Statement of Work of a Superfund 

Cooperative Agreement or a Superfund 

State Contract. 

Title. The valid claim to property that 

denotes ownership and the rights of 

ownership, including the rights of 

possession, control, and disposal of 

property. 

Unit acquisition cost. The net invoice 

unit price of the property including the 

cost of modifications, attachments, 

accessories, or auxiliary apparatus 

necessary to make the property usable 

for the purpose for which it was 

acquired. Other charges, such as the cost 

of installation, transportation, taxes, 

duty, or protective in-transit insurance, 

shall be included or excluded from the 

unit acquisition cost in accordance with 

the recipient’s regular accounting 

practices. 

Value engineering. A systematic and 

creative analysis of each contract term 

or task to ensure that its essential 

function is provided at the overall 

lowest cost. 

Women’s Business Enterprise (WBE). 

A business which is certified as a 

Women’s Business Enterprise by a State 

or Federal agency, or which meets the 

following definition. A Women’s 

Business Enterprise is an independent 

business concern which is at least 51 

percent owned by a woman or women 

who also control and operate it. 

Determination of whether a business is 

at least 51 percent owned by a woman 

or women shall be made without regard 

to community property laws. 

(b) Those terms not defined in this 

section shall have the meanings set forth 

in section 101 of CERCLA, 40 CFR part 

31, and 40 CFR part 300 (the National 

Contingency Plan). 

§ 35.6020 Requirements for both 

applicants and recipients. 

Applicants and recipients must 

comply with the applicable 

requirements of 40 CFR part 32, 

‘‘Governmentwide Debarment and 

Suspension (Non-procurement); and 

Statutory Disqualification under the 

Clean Air Act and Clean Water Act,’’ 

and of 40 CFR part 36, 

‘‘Governmentwide Requirements for 

Drug-Free Workplace (Financial 

Assistance).’’ 

§ 35.6025 Deviation from this subpart. 

On a case-by-case basis, EPA will 

consider requests for an official 

deviation from the non-statutory 

provisions of this subpart. Refer to the 

requirements regarding additions and 

exceptions described in 40 CFR 31.6 (b), 

(c), and (d). 

Pre-Remedial Response Cooperative 

Agreements 

§ 35.6050 Eligibility for pre-remedial 

Cooperative Agreements. 

States, political subdivisions, and 

Indian Tribes may apply for preremedial response Cooperative 

Agreements. 

§ 35.6055 State-lead pre-remedial 

Cooperative Agreements. 

(a) To receive a State-lead preremedial Cooperative Agreement, the 

applicant must submit an ‘‘Application 

for Federal Assistance’’ (SF–424) for 

non-construction programs. 

Applications for additional funding 

need include only the revised pages. 

The application must include the 

following: 

(1) Budget sheets (SF–424A). 

(2) A Project narrative statement, 

including the following: 

(i) A list of sites at which the 

applicant proposes to undertake preremedial tasks. If the recipient proposes 

to revise the list, the recipient may not 

incur costs on a new site until the EPA 

project officer has approved the site; 

(ii) A Statement of Work (SOW) which 

must include a detailed description, by 

task, of activities to be conducted, the 

projected costs associated with each 

task, the number of products to be 

completed, and a quarterly schedule 

indicating when these products will be 

submitted to EPA; and 

(iii) A schedule of deliverables. 

(3) Other applicable forms and 

information authorized by 40 CFR 

31.10. 

(b) Pre-remedial Cooperative 

Agreement requirements. The recipient 

must comply with all terms and 

conditions in the Cooperative 

Agreement, and with the following 

requirements: 

(1) Health and safety plan. (i) Before 

beginning field work, the recipient must 

have a health and safety plan in place 

providing for the protection of on-site 

personnel and area residents. This plan 

need not be submitted to EPA, but must 

be made available to EPA upon request. 

(ii) The recipient’s health and safety 

plan must comply with Occupational 

Safety and Health Administration 

(OSHA) 29 CFR 1910.120, entitled 

‘‘Hazardous Waste Operations and 

Emergency Response,’’ unless the 

recipient is an Indian Tribe exempt from 

OSHA requirements. 

(2) Quality assurance. (i) The 

recipient must comply with the quality 

assurance requirements described in 40 

CFR 31.45. 

(ii) The recipient must have an EPAapproved non-site-specific quality 

assurance plan in place before 

beginning field work. The recipient 

must submit the plan to EPA in 

adequate time (generally 45 days) for 

approval to be granted before beginning 

field work. 

(iii) The quality assurance plan must 

comply with the requirements regarding 

split sampling described in section 

104(e)(4)(B) of CERCLA, as amended. 

§ 35.6060 Political subdivision-lead preremedial Cooperative Agreements. 

(a) If the Award Official determines 

that a political subdivision’s lead 

involvement in pre-remedial activities 

would be more efficient, economical 

and appropriate than that of a State, 

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based on the number of sites to be 

addressed and the political 

subdivision’s history of program 

involvement, a pre-remedial 

Cooperative Agreement may be awarded 

under this section. 

(b) The political subdivision must 

comply with all of the requirements 

described in § 35.6055. 

§ 35.6070 Indian Tribe-lead pre-remedial 

Cooperative Agreements. 

The Indian Tribe must comply with 

all of the requirements described in §

35.6055, except for the 

intergovernmental review requirements 

included in the ‘‘Application for Federal 

Assistance’’ (SF–424). 

Remedial Response Cooperative 

Agreements 

§ 35.6100 Eligibility for remedial 

Cooperative Agreements. 

States, Indian Tribes, and political 

subdivisions may apply for remedial 

response Cooperative Agreements. 

§ 35.6105 State-lead remedial Cooperative 

Agreements. 

To receive a State-lead remedial 

Cooperative Agreement, the applicant 

must submit the following items to EPA: 

(a) Application form, as described in 

§ 35.6055(a). Applications for 

additional funding need to include only 

the revised pages. The application must 

include the following: 

(1) Budget sheets (SF–424A) 

displaying costs by site, activity and 

operable unit, as applicable. 

(2) A Project narrative statement, 

including the following: 

(i) A site description, including a 

discussion of the location of each site, 

the physical characteristics of each site 

(site geology and proximity to drinking 

water supplies), the nature of the release 

(contaminant type and affected media), 

past response actions at each site, and 

response actions still required at each 

site; 

(ii) A site-specific Statement of Work 

(SOW), including estimated costs per 

task, and a standard task to ensure that 

a sign is posted at the site providing the 

appropriate contacts for obtaining 

information on activities being 

conducted at the site, and for reporting 

suspected criminal activities; 

(iii) A statement designating a lead 

site project manager among appropriate 

State offices. This statement must 

demonstrate that the lead State agency 

has conducted coordinated planning of 

response activities with other State 

agencies. The statement must identify 

the name and position of those 

individuals who will be responsible for 

coordinating the State offices; 

(iv) A site-specific Community 

Relations Plan or an assurance that field 

work will not begin until one is in 

place. The Regional community 

relations coordinator must approve the 

Community Relations Plan before the 

recipient begins field work. The 

recipient must comply with the 

community relations requirements 

described in EPA policy and guidance, 

and in the National Contingency Plan; 

(v) A site-specific health and safety 

plan, or an assurance that the applicant 

will have a final plan before starting 

field work. Unless specifically waived 

by the award official, the applicant must 

have a site-specific health and safety 

plan in place providing for the 

protection of on-site personnel and area 

residents. The site-specific health and 

safety plan must comply with 

Occupational Safety and Health 

Administration (OSHA) 29 CFR 

1910.120, entitled, ‘‘Hazardous Waste 

Operations and Emergency Response,’’ 

unless the recipient is an Indian Tribe 

exempt from OSHA requirements; 

(vi) Quality assurance—(A) General. If 

the project involves environmentally 

related measurements or data 

generation, the recipient must comply 

with the requirements regarding quality 

assurance described in 40 CFR 31.45. 

(B) Quality assurance plan. The 

applicant must have a separate quality 

assurance project plan and/or sampling 

plan for each site to be covered by the 

Cooperative Agreement. The applicant 

must submit the quality assurance 

project plan and the sampling plan, 

which incorporates results of any site 

investigation performed at that site, to 

EPA with its Cooperative Agreement 

application. However, at the option of 

the EPA award official with program 

concurrence, the applicant may submit 

with its application a schedule for 

developing the detailed site-specific 

quality assurance plan (generally 45 

days before beginning field work). Field 

work may not begin until EPA approves 

the site-specific quality assurance plan. 

(C) Split sampling. The quality 

assurance plan must comply with the 

requirements regarding split sampling 

described in section 104(e)(4)(B) of 

CERCLA, as amended. 

(vii) A schedule of deliverables to be 

prepared during response activities. 

(3) Other applicable forms and 

information authorized by 40 CFR 

31.10. 

(b) CERCLA Assurances. Before a 

Cooperative Agreement for remedial 

action can be awarded, the State must 

provide EPA with the following written 

assurances: 

(1) Operation and maintenance. The 

State must provide an assurance that it 

will assume responsibility for all future 

operation and maintenance of CERCLAfunded remedial actions for the 

expected life of each such action as 

required by CERCLA section 104(c) and 

addressed in 40 CFR 300.510(c)(1) of the 

NCP. In addition, even if a political 

subdivision is designated as being 

responsible for operation and 

maintenance, the State must guarantee 

that it will assume any or all operation 

and maintenance activities in the event 

of default by the political subdivision. 

(2) Cost sharing. The State must 

provide assurances for cost sharing as 

follows: 

(i) Ten percent. Where a facility, 

whether privately or publicly owned, 

was not operated by the State or 

political subdivision thereof, either 

directly or through a contractual 

relationship or otherwise, at the time of 

any disposal of hazardous substances at 

the facility, the State must provide 10 

percent of the cost of the remedial 

action, if CERCLA-funded. 

(ii) Fifty percent or more. Where a 

facility was operated by a State or 

political subdivision either directly or 

through a contractual relationship or 

otherwise, at the time of any disposal of 

hazardous substances at the facility, the 

State must provide 50 percent (or such 

greater share as EPA may determine 

appropriate, taking into account the 

degree of responsibility of the State or 

political subdivision for the release) of 

the cost of removal, remedial planning, 

and remedial action if the remedial 

action is CERCLA-funded. 

(3) Twenty-year waste capacity. The 

State must assure EPA of the availability 

of hazardous waste treatment or 

disposal facilities within and/or outside 

the State that comply with subtitle C of 

the Solid Waste Disposal Act and that 

have adequate capacity for the 

destruction, treatment, or secure 

disposition of all hazardous wastes that 

are reasonably expected to be generated 

within the State during the 20-year 

period following the date of the 

response agreement. A remedial action 

cannot be funded unless this assurance 

is provided consistent with 40 CFR 

300.510 of the NCP. EPA will determine 

whether the State’s assurance is 

adequate. 

(4) Off-site storage, treatment, or 

disposal. If off-site storage, destruction, 

treatment, or disposal is required, the 

State must assure the availability of a 

hazardous waste disposal facility that is 

in compliance with subtitle C of the 

Solid Waste Disposal Act and is 

acceptable to EPA. The lead agency of 

the State must provide the notification 

required at § 35.6120, if applicable. 

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(5) Real property acquisition. If EPA 

determines in the remedy selection 

process that an interest in real property 

must be acquired in order to conduct a 

response action, such acquisition may 

be funded under a Cooperative 

Agreement. EPA may acquire an interest 

in real estate for the purpose of 

conducting a remedial action only if the 

State provides assurance that it will 

accept transfer of such interest in 

accordance with 40 CFR 300.510(f) of 

the NCP. The State must provide this 

assurance even if it intends to transfer 

this interest to a third party, or to allow 

a political subdivision to accept transfer 

on behalf of the State. If the political 

subdivision is accepting the transferred 

interest in real property, the State must 

guarantee that it will accept transfer of 

such interest in the event of default by 

the political subdivision. If the State or 

political subdivision disposes of the 

transferred real property, it shall comply 

with the requirements for real property 

in 40 CFR 31.31(c)(2). (See § 35.6400 for 

additional information on real property 

acquisition requirements.) 

§ 35.6110 Indian Tribe-lead remedial 

Cooperative Agreements. 

(a) Application requirements. The 

Indian Tribe must comply with all of 

the requirements described in §

35.6105(a). Indian Tribes are not 

required to comply with the 

intergovernmental review requirements 

included in the ‘‘Application for Federal 

Assistance’’ (SF–424). Consistent with 

the NCP (40 CFR 300.510(e)(2)), this 

subpart does not address whether 

Indian Tribes are States for the purpose 

of CERCLA section 104(c)(9). 

(b) Cooperative Agreement 

requirements. (1) The Indian Tribe must 

comply with all terms and conditions in 

the Cooperative Agreement. 

(2) If it is designated the lead for 

remedial action, the Indian Tribe must 

provide the notification required at §

35.6120, substituting the term ‘‘Indian 

Tribe’’ for the term ‘‘State’’ in that 

section, and ‘‘out-of-an-Indian-Tribalarea-of-Indian-country’’ for ‘‘out-ofState’’. 

(3) Indian Tribes are not required to 

share in the cost of CERCLA-funded 

remedial actions. 

§ 35.6115 Political subdivision-lead 

remedial Cooperative Agreements. 

(a) General. If the State concurs, EPA 

may allow a political subdivision with 

the necessary capabilities and 

jurisdictional authority to conduct 

remedial response activities at a site. 

EPA will award the political 

subdivision a Cooperative Agreement to 

conduct remedial response and enter 

into a parallel Superfund State Contract 

with the State, if required (See §

35.6800, when a Superfund State 

Contract is required). The political 

subdivision may also be a signatory to 

the Superfund State Contract. The 

political subdivision must submit to the 

State a copy of all reports provided to 

EPA. 

(b) Political subdivision Cooperative 

Agreement requirements—(1) 

Application requirements. To receive a 

remedial Cooperative Agreement, the 

political subdivision must prepare an 

application which includes the 

documentation described in §

35.6105(a)(1) through (a)(3). 

(2) Cooperative Agreement 

requirements. The political subdivision 

must comply with all terms and 

conditions in the Cooperative 

Agreement. If it is designated the lead 

for remedial action, the political 

subdivision must provide the 

notification required at § 35.6120, 

substituting the term ‘‘political 

subdivision’’ for the term ‘‘State’’ in that 

section. 

§ 35.6120 Notification of the out-of-State 

or out-of-an-Indian-Tribal-area-of-Indiancountry transfer of CERCLA waste. 

(a) The recipient must provide written 

notification of off-site shipments of 

CERCLA waste from a site to an out-ofState or out-of-an-Indian-Tribal-area-ofIndian-country waste management 

facility to: 

(1) The appropriate State 

environmental official for the State in 

which the waste management facility is 

located; and/or 

(2) An appropriate official of an 

Indian Tribe in whose area of Indian 

country the waste management facility 

is located; and 

(3) The EPA Award Official. 

(b) The notification of off-site 

shipments does not apply when the 

total volume of all such shipments from 

the site does not exceed 10 cubic yards. 

(c) The notification must be in writing 

and must provide the following 

information, where available: 

(1) The name and location of the 

facility to which the CERCLA waste is 

to be shipped; 

(2) The type and quantity of CERCLA 

waste to be shipped; 

(3) The expected schedule for the 

shipments of the CERCLA waste; and 

(4) The method of transportation of 

the CERCLA waste. 

(d) The recipient must notify the State 

or Indian Tribal government in which 

the planned receiving facility is located 

of major changes in the shipment plan, 

such as a decision to ship the CERCLA 

waste to another facility within the 

same receiving State, or to a facility in 

another State. 

(e) The recipient must provide 

relevant information on the off-site 

shipments, including the information in 

paragraph (c) of this section, as soon as 

possible after the award of the contract 

and, where practicable, before the 

CERCLA waste is actually shipped. 

Enforcement Cooperative Agreements 

§ 35.6145 Eligibility for enforcement 

Cooperative Agreements. 

Pursuant to CERCLA section 104(d), 

States, political subdivisions thereof, 

and Indian Tribes may apply for 

enforcement Cooperative Agreements. 

To be eligible for an enforcement 

Cooperative Agreement, the State, 

political subdivision or Indian Tribe 

must demonstrate that it has the 

authority, jurisdiction, and the 

necessary administrative capabilities to 

take an enforcement action(s) to compel 

PRP cleanup of the site, or recovery of 

the cleanup costs. To accomplish this, 

the State, political subdivision or Indian 

Tribe, respectively, must submit the 

following for EPA approval: 

(a) A letter from the State Attorney 

General, or comparable local official (of 

a political subdivision) or comparable 

Indian Tribal official, certifying that it 

has the authority, jurisdiction, and 

administrative capabilities that provide 

a basis for pursuing enforcement actions 

against a PRP to secure the necessary 

response; 

(b) A copy of the applicable State, 

local (political subdivision) or Indian 

Tribal statute(s) and a description of 

how it is implemented; 

(c) Any other documentation required 

by EPA to demonstrate that the State, 

local (political subdivision) or Indian 

Tribal government has the statutory 

authority, jurisdiction, and 

administrative capabilities to perform 

the enforcement activity(ies) to be 

funded under the Cooperative 

Agreement. 

§ 35.6150 Activities eligible for funding 

under enforcement Cooperative 

Agreements. 

An enforcement Cooperative 

Agreement application from a State, 

political subdivision or Indian Tribe 

may request funding for the following 

enforcement activities: 

(a) PRP searches; 

(b) Issuance of notice letters and 

negotiation activities; 

(c) Administrative and judicial 

enforcement actions taken under State 

or Indian Tribal law; 

(d) Management assistance and 

oversight of PRPs during Federal 

enforcement response; 

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(e) Oversight of PRPs during a State, 

political subdivision or Indian Tribe 

enforcement response contingent on the 

applicant having taken all necessary 

action to compel PRPs to fund the 

oversight of cleanup activities 

negotiated under the recipient’s 

enforcement authorities. If the State, 

political subdivision, Indian Tribe or 

EPA cannot obtain PRP commitment to 

fund such oversight activities, then 

these activities will be considered 

eligible for CERCLA funding under an 

enforcement Cooperative Agreement. 

§ 35.6155 State, political subdivision or 

Indian Tribe-lead enforcement Cooperative 

Agreements. 

(a) The State, political subdivision or 

Indian Tribe must comply with the 

requirements described in § 35.6105 

(a)(1) through (a)(3), as appropriate. 

(b) The CERCLA section 104 

assurances described in § 35.6105(b) are 

not applicable for enforcement 

Cooperative Agreements. 

(c) Before an enforcement Cooperative 

Agreement is awarded, the State, 

political subdivision or Indian Tribe 

must: 

(1) Assure EPA that it will notify and 

consult with EPA promptly if the 

recipient determines that its laws or 

other restrictions prevent the recipient 

from acting consistently with CERCLA; 

and 

(2) If the applicant is seeking funds 

for oversight of PRP cleanup, the 

applicant must: 

(i) Demonstrate that the proposed 

Statement of Work or cleanup plan 

prepared by the PRP satisfies the 

recipient’s enforcement goals for those 

instances in which the recipient is 

seeking funding for oversight of PRP 

cleanup activities negotiated under the 

recipient’s own enforcement authorities; 

and 

(ii) Demonstrate that the PRP has the 

capability to attain the goals set forth in 

the plan; 

(iii) Demonstrate that it has taken all 

necessary action to compel PRPs to fund 

the oversight of cleanup activities 

negotiated under the recipient’s 

enforcement authorities. 

Removal Response Cooperative 

Agreements 

§ 35.6200 Eligibility for removal 

Cooperative Agreements. 

When a planning period of more than 

six months is available, States, political 

subdivisions and Indian Tribes may 

apply for removal Cooperative 

Agreements. 

§ 35.6205 Removal Cooperative 

Agreements. 

(a) The State must comply with the 

requirements described in § 35.6105(a). 

To the extent practicable, the State must 

comply with the notification 

requirement at § 35.6120 when a 

removal action is necessary and 

involves out-of-State shipment of 

CERCLA wastes, and when, based on 

the site evaluation, EPA determines that 

a planning period of more than six 

months is available before the removal 

activities must begin. 

(b) Pursuant to CERCLA section 

104(c)(3), the State is not required to 

share in the cost of a CERCLA-funded 

removal action, unless the removal is 

conducted at a site that was publicly 

operated by a State or political 

subdivision at the time of disposal of 

hazardous substances and a CERCLAfunded remedial action is ultimately 

undertaken at the site. In this situation, 

the State must share at least 50 percent 

in the cost of all removal, remedial 

planning, and remedial action costs at 

the time of the remedial action as stated 

in § 35.6105(b)(2)(ii). 

(c) If both the State and EPA agree, a 

political subdivision with the necessary 

capabilities and jurisdictional authority 

may assume the lead responsibility for 

all, or a portion, of the removal activity 

at a site. Political subdivisions must 

comply with the requirements described 

in § 35.6105(a). To the extent 

practicable, political subdivisions also 

must comply with the notification 

requirement at § 35.6120 when a 

removal action is necessary and 

involves the shipment of CERCLA 

wastes out of the State’s jurisdiction, 

and when, based on the site evaluation, 

EPA determines that a planning period 

of more than six months is available 

before the removal activities must begin. 

(d) The State must provide the cost 

share assurance discussed in paragraph 

(b) of this section on behalf of a political 

subdivision that is given the lead for a 

removal action. 

(e) Indian Tribes must comply with 

the requirements described in §

35.6105(a). To the extent practicable, 

Indian Tribes also must comply with the 

notification requirement at § 35.6120 

when a removal action is necessary and 

involves the shipment of CERCLA 

wastes out of the Indian Tribe’s area of 

Indian country, and when, based on the 

site evaluation, EPA determines that a 

planning period of more than six 

months is available before the removal 

activities must begin. 

(f) Indian Tribes are not required to 

share in the cost of a CERCLA-funded 

removal action. 

Core Program Cooperative Agreements 

§ 35.6215 Eligibility for Core Program 

Cooperative Agreements. 

(a) States and Indian Tribes may 

apply for Core Program Cooperative 

Agreements in order to conduct 

CERCLA implementation activities that 

are not directly assignable to specific 

sites, but are intended to develop and 

maintain a State’s or Indian Tribe’s 

ability to participate in the CERCLA 

response program. 

(b) Only the State or Indian Tribal 

government agency designated as the 

single point of contact with EPA for 

CERCLA implementation is eligible to 

receive a Core Program Cooperative 

Agreement. 

(c) When it is more economical for a 

government entity other than the 

recipient (such as a political subdivision 

or State Attorney General) to implement 

tasks funded through a Core Program 

Cooperative Agreement, benefits to such 

entities must be provided for in an 

intergovernmental agreement. 

§ 35.6220 General. 

The recipient of a Core Program 

Cooperative Agreement must comply 

with the requirements regarding 

financial administration (§ § 35.6270 

through 35.6290), property (§ § 35.6300 

through 35.6450), procurement (§ §

35.6550 through 35.6610), reporting (§ §

35.6650 through 35.6670), records (§ §

35.6700 through 35.6710), and other 

administrative requirements under a 

Cooperative Agreement (§ § 35.6750 

through 35.6790). Recipients may not 

incur site-specific costs. Where these 

sections entail site-specific 

requirements, the recipient is not 

required to comply on a site-specific 

basis. 

§ 35.6225 Activities eligible for funding 

under Core Program Cooperative 

Agreements. 

(a) To be eligible for funding under a 

Core Program Cooperative Agreement, 

activities must develop and maintain a 

recipient’s abilities to implement 

CERCLA. Once the recipient has in 

place program functions described in 

paragraphs (a)(1) through (a)(4) of this 

section, EPA will evaluate the 

recipient’s program needs to sustain 

interaction with EPA in CERCLA 

implementation as described in 

paragraph (a)(5) of this section. The 

amount of funding provided under the 

Core Program will be determined by 

EPA based on the availability of funds 

and the recipient’s program needs in the 

areas described in paragraphs (a)(1) 

through (a)(4) of this section: 

(1) Procedures for emergency 

response actions and longer-term 

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remediation of environmental and 

health risks at hazardous waste sites 

(including but not limited to the 

development of generic health and 

safety plans, quality assurance project 

plans, and community relation plans); 

(2) Provisions for satisfying all 

requirements and assurances (including 

the development of a fund or other 

financing mechanism(s) to pay for 

studies and remediation activities); 

(3) Legal authorities and enforcement 

support associated with proper 

administration of the recipient’s 

program and with efforts to compel 

potentially responsible parties to 

conduct or pay for studies and/or 

remediation (including but not limited 

to the development of statutory 

authorities; access to legal assistance in 

identifying applicable or relevant and 

appropriate requirements of other laws; 

and development and maintenance of 

the administrative, financial and 

recordkeeping systems necessary for 

cost recovery actions under CERCLA); 

(4) Efforts necessary to hire and train 

staff to manage publicly-funded 

cleanups, oversee responsible party-lead 

cleanups, and provide clerical support; 

and 

(5) Other activities deemed necessary 

by EPA to develop and maintain 

sustained EPA/recipient interaction in 

CERCLA implementation (including but 

not limited to general program 

management and supervision necessary 

for a recipient to implement CERCLA 

activities, and interagency coordination 

on all phases of CERCLA response). 

(b) Continued funding of tasks in 

subsequent years will be based on an 

evaluation of demonstrated progress 

toward the goals in the existing Core 

Program Cooperative Agreement 

Statement of Work. 

§ 35.6230 Application requirements. 

To receive a Core Program 

Cooperative Agreement, the applicant 

must submit an application form 

(‘‘Application for Federal Assistance,’’ 

SF–424, for non-construction programs) 

to EPA. Applications for additional 

funding need include only the revised 

pages. The application must include the 

following: 

(a) A project narrative statement, 

including the following: 

(1) A Statement of Work (SOW) which 

must include a detailed description of 

the CERCLA-funded activities and tasks 

to be conducted, the projected costs 

associated with each task, the number of 

products to be completed, and a 

schedule for implementation. Eligible 

activities under Core Program 

Cooperative Agreements are discussed 

in § 35.6225; and 

(2) A background statement, 

describing the current abilities and 

authorities of the recipient’s program for 

implementing CERCLA, the program’s 

needs to sustain and increase recipient 

involvement in CERCLA 

implementation, and the impact of Core 

Program Cooperative Agreement funds 

on the recipient’s involvement in sitespecific CERCLA response. 

(b) Budget sheets (SF–424A). 

(c) Proposed project and budget 

periods for CERCLA-funded activities. 

The project and budget periods may be 

one or more years and may be extended 

incrementally, up to 12 months at a 

time, with EPA approval. 

(d) Other applicable forms and 

information authorized by 40 CFR 

31.10. 

§ 35.6235 Cost sharing. 

A State must provide at least ten 

percent of the direct and indirect costs 

of all activities covered by the Core 

Program Cooperative Agreement. Indian 

Tribes are not required to share in the 

cost of Core Program activities. The 

State must provide its cost share with 

non-Federal funds or with Federal 

funds, authorized by statute to be used 

for matching purposes. Funds used for 

matching purposes under any other 

Federal grant or Cooperative Agreement 

cannot be used for matching purposes 

under a Core Program Cooperative 

Agreement. The State may provide its 

share using in-kind contributions if 

such contributions are provided for in 

the Cooperative Agreement. The State 

may not use CERCLA State credits to 

offset any part of its required match for 

Core Program Cooperative Agreements. 

(See § 35.6285 (c), (d), and (f) regarding 

credit, excess cash cost share 

contributions/over match, and advance 

match, respectively.) 

Support Agency Cooperative 

Agreements 

§ 35.6240 Eligibility for support agency 

Cooperative Agreements. 

States, political subdivisions, and 

Indian Tribes may apply for support 

agency Cooperative Agreements to 

ensure their meaningful and substantial 

involvement in response activities, as 

specified in sections 104 and 121(f)(1) of 

CERCLA and the NCP (40 CFR part 300). 

§ 35.6245 Allowable activities. 

Support agency activities are those 

activities conducted by the recipient to 

ensure its meaningful and substantial 

involvement. The activities described in 

section 121(f)(1) of CERCLA, as 

amended, and in subpart F of the NCP 

(40 CFR part 300), are eligible for 

funding under a support agency 

Cooperative Agreement. Participation in 

five-year reviews of the continuing 

protectiveness of a remedial action is 

also an eligible support agency activity. 

§ 35.6250 Support agency Cooperative 

Agreement requirements. 

(a) Application requirements. The 

applicant must comply with the 

requirements described in §

35.6105(a)(1) and (3), and other 

requirements as negotiated with EPA. 

(Indian Tribes are exempt from the 

requirement of Intergovernmental 

Review in 40 CFR part 29.) An applicant 

may submit a non-site-specific budget 

for support agency activities. 

(b) Cooperative Agreement 

requirements. The recipient must 

comply with the requirements regarding 

financial administration (§ § 35.6270 

through 35.6290), property (§ § 35.6300 

through 35.6450), procurement (§ §

35.6550 through 35.6610), reporting (§ §

35.6650 through 35.6670), records (§ §

35.6700 through 35.6710), and other 

administrative requirements under a 

Cooperative Agreement (§ § 35.6750 

through 35.6790). 

Combining Cooperative Agreements 

§ 35.6260 Combining Cooperative 

Agreement sites and activities. 

(a) EPA may award a Cooperative 

Agreement to a recipient for: 

(1) A single activity, or multiple 

activities; 

(2) A single activity at multiple sites; 

and 

(3) Except as provided in paragraphs 

(b), (c), and (d) of this section, multiple 

activities at multiple sites. 

(b) EPA will not award or amend a 

Cooperative Agreement to a political 

subdivision to conduct multiple 

activities at multiple sites. Before 

awarding or amending a Cooperative 

Agreement to permit multiple activities 

at multiple sites, EPA must determine 

that the State or Indian Tribe has 

adequate administrative, technical, and 

financial management and tracking 

capabilities. A State’s or Indian Tribe’s 

request for such a Cooperative 

Agreement will be considered only if 

EPA determines that consolidating these 

activities under one Cooperative 

Agreement would be in the Agency’s 

best interests. 

(c) EPA will not award a single 

Cooperative Agreement to conduct 

multiple remedial actions at multiple 

sites. 

(d) EPA will require separate 

Cooperative Agreements for eligible 

removal actions that exceed the 

statutory monetary ceiling or whenever 

a consistency waiver is likely to be 

sought. 

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Financial Administration Requirements 

Under a Cooperative Agreement 

§ 35.6270 Standards for financial 

management systems. 

(a) Accounting system standards—(1) 

General. The recipient’s system must 

track expenses by site, activity, and, 

operable unit, as applicable, according 

to object class. The system must also 

provide control, accountability, and an 

assurance that funds, property, and 

other assets are used only for their 

authorized purposes. The recipient must 

allow an EPA review of the adequacy of 

the financial management system as 

described in 40 CFR 31.20(c). 

(2) Allowable costs. The recipient’s 

systems must comply with the 

appropriate allowable cost principles 

described in 40 CFR 31.22. 

(3) Pre-remedial. The system need not 

track expenses by site. However, all preremedial costs must be documented 

under a single Superfund account 

number designated specifically for the 

pre-remedial activity. 

(4) Core Program. Since all costs 

associated with Core Program 

Cooperative Agreements are non-sitespecific, the systems need not track 

expenses by site. However, all Core 

Program costs must be documented 

under the Superfund account number(s) 

designated specifically for Core Program 

activity. 

(5) Support Agency. All support 

agency agreements will be assigned a 

single Superfund activity code 

designated specifically for support 

agency activities. All support agency 

costs, however, must be documented 

site specifically in accordance with the 

terms and conditions specified in the 

Cooperative Agreement. 

(6) Accounting system control 

procedures. Except as provided for in 

paragraph (a)(3) of this section, 

accounting system control procedures 

must ensure that accounting 

information is: 

(i) Accurate, charging only costs 

attributable to the site, activity, and 

operable unit, as applicable; and 

(ii) Complete, recording and charging 

to individual sites, activities, and 

operable units, as applicable, all costs 

attributable to the recipient’s CERCLA 

effort. 

(7) Financial reporting. The 

recipient’s accounting system must use 

actual costs as the basis for all reports 

of direct site charges. The recipient 

must comply with the requirements for 

financial reporting contained in §

35.6670. 

(b) Recordkeeping system standards. 

(1) The recipient must maintain a 

recordkeeping system that enables sitespecific costs to be tracked by site, 

activity, and operable unit, as 

applicable, and provides sufficient 

documentation for cost recovery 

purposes. 

(2) The recipient must provide this 

site-specific documentation to the EPA 

Regional Office within 30 working days 

of a request, unless another time frame 

is specified in the Cooperative 

Agreement. 

(3) In addition, the recipient must 

comply with the requirements regarding 

records described in § § 35.6700, 

35.6705, and 35.6710. The recipient 

must comply with the requirements 

regarding source documentation 

described in 40 CFR 31.20(b)(6). 

(4) For pre-remedial and Core 

Program activities, the recordkeeping 

system must comply with the 

requirements described in paragraphs 

(a)(3) and (a)(4) of this section. 

§ 35.6275 Period of availability of funds. 

(a) The recipient must comply with 

the requirements regarding the 

availability of funds described in 40 

CFR 31.23. 

(b) Except as permitted in § 35.6285, 

the Award Official must sign the 

assistance agreement before costs are 

incurred. The recipient may incur costs 

between the date the Award Official 

signs the assistance agreement and the 

date the recipient signs the agreement, 

if the costs are identified in the 

agreement and the recipient does not 

change the agreement. 

§ 35.6280 Payments. 

(a) General. In addition to the 

following requirements, the recipient 

must comply with the requirements 

regarding payment described in 40 CFR 

31.21 (f) through (h). 

(1) Assignment of payment. The 

recipient cannot assign the right to 

receive payments under the recipient’s 

Cooperative Agreement. EPA will make 

payments only to the payee identified in 

the Cooperative Agreement. 

(2) Interest. The interest a recipient 

earns on an advance of EPA funds is 

subject to the requirements of 40 CFR 

31.21(i), ‘‘Interest earned on advances.’’ 

(b) Payment method—(1) Letter of 

credit. In order to receive payment by 

the letter of credit method, the recipient 

must comply with the requirements 

regarding letter of credit described in 40 

CFR 31.20 (b)(7) and 31.21(b). The 

recipient must identify and charge costs 

to specific sites, activities, and operable 

units, as applicable, for drawdown 

purposes as specified in the Cooperative 

Agreement. 

(2) Reimbursement. If the recipient is 

unable to meet letter of credit 

requirements, EPA will pay the 

recipient by reimbursement. The 

recipient must comply with the 

requirements regarding reimbursement 

described in 40 CFR 31.21(d). 

(3) Working capital advances. If the 

recipient is unable to meet the criteria 

for payment by either letter of credit or 

reimbursement, EPA may provide cash 

on a working capital advance basis. 

Under this procedure EPA shall advance 

cash to the recipient to cover its 

estimated disbursement needs for an 

initial period generally geared to the 

recipient’s disbursing cycle. Thereafter, 

EPA shall reimburse the recipient for its 

actual cash disbursements. In such 

cases, the recipient must comply with 

the requirements regarding working 

capital advances described in 40 CFR 

31.21(e). 

§ 35.6285 Recipient payment of response 

costs. 

The recipient may pay for its share of 

response costs using cash, services, 

credits or any combination of these, as 

follows: 

(a) Cash. The recipient may pay for its 

share of response costs in the form of 

cash. 

(b) Services. The recipient may 

provide equipment and services to 

satisfy its cost share requirements under 

Cooperative Agreements. The recipient 

must comply with the requirements 

regarding in-kind and donated services 

described in 40 CFR 31.24. 

(c) Credit—(1) General credit 

requirements. Credits are limited to 

State site-specific expenses that EPA 

determines to be reasonable, 

documented, direct, out-of-pocket 

expenditures of non-Federal funds for 

remedial action, as defined in CERCLA 

section 101(24), that are consistent with 

a permanent remedy at the site. Credits 

are established on a site-specific basis. 

Only a State may claim credit. 

(i) The State may claim credit for 

response activity obligations or 

expenditures incurred by the State or 

political subdivision between January 1, 

1978, and December 11, 1980. 

(ii) The State may claim credit for 

remedial action expenditures made by 

the State after October 17, 1986. If such 

expenditures occurred after the site was 

listed on the NPL (Appendix B to 40 

CFR Part 300), they will be eligible for 

a credit only if the State initiated the 

remedial action after obtaining EPA’s 

written approval. 

(iii) The State may not claim credit for 

removal actions taken after December 

11, 1980. 

(2) Credit submission requirements. 

Although EPA may require additional 

documentation, the State must submit 

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the following before EPA will approve 

the use of the credit: 

(i) Specific amounts claimed for 

credit, by site (estimated amounts are 

unacceptable), based on supporting cost 

documentation; 

(ii) Units of government (State agency, 

county, local) that incurred the costs, by 

site; 

(iii) Description of the specific 

function performed by each unit of 

government at each site; 

(iv) Certification (signed by the State’s 

fiscal manager or the financial director 

for each unit of government) that credit 

costs have not been previously 

reimbursed by the Federal Government 

or any other party, and have not been 

used for matching purposes under any 

other Federal program or grant; and 

(v) Documentation, if requested by 

EPA, to ensure the actions undertaken at 

the site are cost eligible and consistent 

with CERCLA, as amended, and the 

NCP requirements in 40 CFR part 300. 

This requirement does not apply for 

costs incurred before December 11, 

1980. 

(3) Use of credit. The State must first 

apply credit at the site at which it was 

earned. With the approval of EPA, the 

State may use excess credit earned at 

one site for its cost share at another site 

(See CERCLA section 104(c)(5)). Credits 

must be applied on a site-specific basis, 

and, therefore, may not be used to meet 

State cost share requirements for Core 

Program Cooperative Agreements. EPA 

will not reimburse excess credit. 

(4) Credit verification procedures. 

Expenditure submissions are subject to 

verification by audit or other financial 

review. EPA may conduct a technical 

review (including inspection) to verify 

that the claimed remedial action is 

consistent with CERCLA and the NCP 

(40 CFR part 300). 

(d) Excess cash cost share 

contributions/overmatch. The recipient 

may direct EPA to return the excess 

funds or to use the overmatch at one site 

to meet the cost share obligation at 

another site. The recipient may not use 

contributions in excess of the required 

cost share at one site to meet the cost 

share obligation for the Core Program 

cost share. Overmatch is not ‘‘credit’’ 

pursuant to paragraph (c)(3) of this 

section. 

(e) Cost sharing. The recipient must 

comply with the requirements regarding 

cost sharing described in 40 CFR 31.24. 

Finally, the recipient cannot use costs 

incurred under the Core Program to 

offset cost share requirements at a site. 

(f) Advance match. (1) A Cooperative 

Agreement for a site-specific response 

entered into after October 17, 1986, 

cannot authorize a State to contribute 

funds during remedial planning and 

then apply those contributions to the 

remedial action cost share (advance 

match). 

(2) A State may seek reimbursement 

for costs incurred under Cooperative 

Agreements which authorize advance 

match. 

(3) Reimbursements are subject to the 

availability of appropriated funds. 

(4) If the State does not seek 

reimbursement, EPA will apply the 

advance match to off-set the State’s 

required cost share for remedial action 

at the site. The State may not use 

advance match for credit at any other 

site, nor may the State receive 

reimbursement until the conclusion of 

CERCLA-funded remedial response 

activities. Also, the State may not use 

advance match for credit against cost 

share obligations for Core Program 

Cooperative Agreements. 

(5) Claims for advance match are 

subject to verification by audit. 

§ 35.6290 Program income. 

The recipient must comply with the 

requirements regarding program income 

described in 40 CFR 31.25. Recoveries 

of Federal cost share amounts are not 

program income, and whether such 

recoveries are received before or after 

expiration of the Cooperative 

Agreement, must be reimbursed 

promptly to EPA. 

Personal Property Requirements Under 

a Cooperative Agreement 

§ 35.6300 General personal property 

acquisition and use requirements. 

(a) General. (1) Property may be 

acquired only when authorized in the 

Cooperative Agreement. 

(2) The recipient must acquire the 

property during the approved project 

period. 

(3) The recipient must: 

(i) Charge property costs by site, 

activity, and operable unit, as 

applicable; 

(ii) Document the use of the property 

by site, activity, and operable unit, as 

applicable; and 

(iii) Solicit and follow EPA’s 

instructions on the disposal of any 

property purchased with CERCLA funds 

as specified in § § 35.6340 and 35.6345. 

(b) Exception. The recipient is not 

required to charge property costs by site 

under a pre-remedial or Core Program 

Cooperative Agreement. 

§ 35.6305 Obtaining supplies. 

To obtain supplies, the recipient must 

agree to comply with the requirements 

in § § 35.6300, 35.6315(b), 35.6325 

through 35.6340, and 35.6350. Supplies 

obtained with Core Program funds must 

be for non-site-specific purposes. All 

purchases of supplies under the Core 

Program must comply with the 

requirements in § § 35.6300, 35.6315(b), 

35.6325 through 35.6340, and 35.6350, 

except where these requirements are 

site-specific. 

§ 35.6310 Obtaining equipment. 

To obtain equipment, the recipient 

must agree to comply with the 

requirements in § § 35.6300 and 

35.6315 through 35.6350. 

§ 35.6315 Alternative methods for 

obtaining property. 

(a) Purchase equipment with recipient 

funds. The recipient may purchase 

equipment with the recipient’s own 

funds and may charge EPA a fee for 

using equipment on a CERCLA-funded 

project. The fee must be based on a 

usage rate, subject to the usage rate 

requirements in § 35.6320. 

(b) Borrow federally owned property. 

The recipient may borrow federally 

owned property, with the exception of 

motor vehicles, for use on CERCLAfunded projects. The loan of the 

federally owned property may only 

extend through the project period. At 

the end of the project period, or when 

the federally owned property is no 

longer needed for the project, the 

recipient must return the property to the 

Federal Government. 

(c) Lease, use contractor services, or 

purchase with CERCLA funds. To 

acquire equipment through lease, use of 

contractor services, or purchase with 

CERCLA funds, the recipient must 

conduct and document a cost 

comparison analysis to determine which 

of these methods of obtaining 

equipment is the most cost effective. In 

order to obtain the equipment, the 

recipient must submit documentation of 

the cost comparison analysis to EPA for 

approval. The recipient must obtain the 

equipment through the most costeffective method, subject to the 

following requirements: 

(1) Lease or rent equipment. If it is the 

most cost-effective method of 

acquisition, the recipient may lease or 

rent equipment, subject only to the 

requirements in § 35.6300. 

(2) Use contractor services. (i) If it is 

the most cost-effective method of 

acquisition, the recipient may hire the 

services of a contractor. 

(ii) The recipient must obtain award 

official approval before authorizing the 

contractor to purchase equipment with 

CERCLA funds. (See § 35.6325, 

regarding the title and vested interest of 

equipment purchased with CERCLA 

funds.) This does not apply for 

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recipients who have used the sealed 

bids method of procurement. 

(iii) The recipient must require the 

contractor to allocate the cost of the 

contractor services by site, activity, and 

operable unit, as applicable. 

(3) Purchase equipment with CERCLA 

funds. If equipment purchase is the 

most cost-effective method of obtaining 

the equipment, the recipient may 

purchase the equipment with CERCLA 

funds. To purchase equipment with 

CERCLA funds, the recipient must 

comply with the following 

requirements: 

(i) The recipient must include in the 

Cooperative Agreement application a 

list of all items of equipment to be 

purchased with CERCLA funds, with 

the price of each item. 

(ii) If the equipment is to be used on 

sites, the recipient must allocate the cost 

of the equipment by site, activity, and 

operable unit, as applicable, by applying 

a usage rate subject to the usage rate 

requirements in § 35.6320. 

(iii) The recipient may not use 

CERCLA funds to purchase a 

transportable or mobile treatment 

system. 

(iv) Equipment obtained with Core 

Program funds must be for non-sitespecific purposes. All purchases of 

equipment must comply with the 

requirements in § § 35.6300, and 

35.6310 through 35.6350, except where 

these requirements are site-specific. 

§ 35.6320 Usage rate. 

(a) Usage rate approval. To charge 

EPA a fee for use of equipment 

purchased with recipient funds or to 

allocate the cost of equipment by site, 

activity, and operable unit, as 

applicable, the recipient must apply a 

usage rate. The recipient must submit 

documentation of the usage rate 

computation to EPA. The EPA-approved 

usage rate must be included in the 

Cooperative Agreement before the 

recipient incurs these equipment costs. 

(b) Usage rate application. The 

recipient must record the use of the 

equipment by site, activity, and 

operable unit, as applicable, and must 

apply the usage rate to calculate 

equipment charges by site, activity, and 

operable unit, as applicable. For Core 

Program and pre-remedial activities, the 

recipient is not required to apply a 

usage rate. 

§ 35.6325 Title and EPA interest in 

CERCLA-funded property. 

(a) EPA’s interest in CERCLA-funded 

property. EPA has an interest (the 

percentage of EPA’s participation in the 

total award) in both equipment and 

supplies purchased with CERCLA 

funds. 

(b) Title in CERCLA-funded property. 

Title in both equipment and supplies 

purchased with CERCLA funds vests in 

the recipient. 

(1) Right to transfer title. EPA retains 

the right to transfer title of all property 

purchased with CERCLA funds to the 

Federal Government or a third party 

within 120 calendar days after project 

completion or at the time of disposal. 

(2) Equipment used as all or part of 

the remedy. The following requirements 

apply to equipment used as all or part 

of the remedy: 

(i) Fixed in-place equipment. EPA no 

longer has an interest in fixed in-place 

equipment once the equipment is 

installed. 

(ii) Equipment that is an integral part 

of services to individuals. EPA no longer 

has an interest in equipment that is an 

integral part of services to individuals, 

such as pipes, lines, or pumps providing 

hookups for homeowners on an existing 

water distribution system, once EPA 

certifies that the remedy is operational 

and functional. 

§ 35.6330 Title to federally owned 

property. 

Title to all federally owned property 

vests in the Federal Government. 

§ 35.6335 Property management 

standards. 

The recipient must comply with the 

following property management 

standards for property purchased with 

CERCLA funds. The recipient may use 

its own property management system if 

it meets the following standards. 

(a) Control. The recipient must 

maintain: 

(1) Property records for CERCLAfunded property which include the 

contents specified in § 35.6700(c); 

(2) A control system that ensures 

adequate safeguards for prevention of 

loss, damage, or theft of the property. 

The recipient must make provisions for 

the thorough investigation and 

documentation of any loss, damage, or 

theft; 

(3) Procedures to ensure maintenance 

of the property are in good condition 

and periodic calibration of the 

instruments used for precision 

measurements; 

(4) Sales procedures to ensure the 

highest possible return, if the recipient 

is authorized to sell the property; 

(5) Provisions for financial control 

and accounting in the financial 

management system of all equipment; 

and 

(6) Identification of all federally 

owned property. 

(b) Inventory and reporting for 

CERCLA-funded equipment—(1) 

Physical inventory. The recipient must 

conduct a physical inventory at least 

once every two years for all equipment 

except that which is part of the in-place 

remedy. The recipient must reconcile 

physical inventory results with the 

equipment records. 

(2) Inventory reports. The recipient 

must comply with requirements for 

inventory reports set forth in § 35.6660. 

(c) Inventory and reporting for 

federally owned property—(1) Physical 

inventory. The recipient must conduct a 

physical inventory: 

(i) Annually; 

(ii) When the property is no longer 

needed; and 

(iii) Within 90 days after the end of 

the project period. 

(2) Inventory reports. The recipient 

must comply with requirements for 

inventory reports in § 35.6660. 

§ 35.6340 Disposal of CERCLA-funded 

property. 

(a) Equipment. For equipment that is 

no longer needed, or at the end of the 

project period, whichever is earlier, the 

recipient must: 

(1) Analyze two alternatives: The cost 

of leaving the equipment in place, and 

the cost of removing the equipment and 

disposing of it in another manner. 

(2) Document the analysis of the two 

alternatives in the inventory report. See 

§ 35.6660 regarding requirements for 

the inventory report. 

(i) If it is most cost-effective to remove 

the equipment and dispose of it in 

another manner: 

(A) If the equipment has a residual 

fair market value of $5,000 or more, the 

recipient must request disposition 

instructions from EPA in the inventory 

report. See § 35.6345 for equipment 

disposal options. 

(B) If the equipment has a residual fair 

market value of less than $5,000, the 

recipient may retain the equipment for 

the recipient’s use on another CERCLA 

site. If, however, there is any remaining 

residual value at the time of final 

disposition, the recipient must 

reimburse the Hazardous Substance 

Superfund for EPA’s vested interest in 

the current fair market value of the 

equipment at the time of disposition. 

(ii) If it is most cost-effective to leave 

the equipment in place, recommend in 

the inventory report that the equipment 

be left in place. 

(3) Submit the inventory report to 

EPA, even if EPA has stopped 

supporting the project. 

(b) Supplies. (1) If supplies have an 

aggregate fair market value of $5,000 or 

more at the end of the project period, 

the recipient must take one of the 

following actions at the direction of 

EPA: 

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(i) Use the supplies on another 

CERCLA project and reimburse the 

original project for the fair market value 

of the supplies; 

(ii) If both the recipient and EPA 

concur, keep the supplies and reimburse 

the Hazardous Substance Superfund for 

EPA’s interest in the current fair market 

value of the supplies; or 

(iii) Sell the supplies and reimburse 

the Hazardous Substance Superfund for 

EPA’s interest in the current fair market 

value of the supplies, less any 

reasonable selling expenses. 

(2) If the supplies remaining at the 

end of the project period have an 

aggregate fair market value of less than 

$5,000, the recipient may keep the 

supplies to use on another CERCLA 

project. If the recipient cannot use the 

supplies on another CERCLA project, 

then the recipient may keep or sell the 

supplies without reimbursing the 

Hazardous Substance Superfund. 

§ 35.6345 Equipment disposal options. 

The following disposal options are 

available: 

(a) Use the equipment on another 

CERCLA project and reimburse the 

original project for the fair market value 

of the equipment; 

(b) If both the recipient and EPA 

concur, keep the equipment and 

reimburse the Hazardous Substance 

Superfund for EPA’s interest in the 

current fair market value of the 

equipment; 

(c) Sell the equipment and reimburse 

the Hazardous Substance Superfund for 

EPA’s interest in the current fair market 

value of the equipment, less any 

reasonable selling expenses; or 

(d) Return the equipment to EPA and, 

if applicable, EPA will reimburse the 

recipient for the recipient’s 

proportionate share in the current fair 

market value of the equipment. 

§ 35.6350 Disposal of federally owned 

property. 

When federally owned property is no 

longer needed, or at the end of the 

project, the recipient must inform EPA 

that the property is available for return 

to the Federal Government. EPA will 

send disposition instructions to the 

recipient. 

Real Property Requirements Under a 

Cooperative Agreement 

§ 35.6400 Acquisition and transfer of 

interest. 

(a) An interest in real property may be 

acquired only with prior approval of 

EPA. 

(1) If the recipient acquires real 

property in order to conduct the 

response, the recipient with jurisdiction 

over the property must agree to hold the 

necessary property interest. 

(2) If it is necessary for the Federal 

Government to acquire the interest in 

real estate to permit conduct of a 

remedial action, the acquisition may be 

made only if the State provides 

assurance that it will accept transfer of 

the acquired interest in accordance with 

40 CFR 300.510(f) of the NCP. States 

must follow the requirements in §

35.6105(b)(5). 

(b) The recipient must comply with 

applicable Federal regulations for real 

property acquisition under assistance 

agreements contained in part 4 of this 

chapter, ‘‘Uniform Relocation 

Assistance and Real Property 

Acquisition for Federal and Federally 

Assisted Programs.’’ 

§ 35.6405 Use. 

The recipient must comply with the 

requirements regarding real property 

described in 40 CFR 31.31. 

Copyright Requirements Under a 

Cooperative Agreement 

§ 35.6450 General requirements. 

The recipient must comply with the 

requirements regarding copyrights 

described in 40 CFR 31.34. The 

recipient must comply with the 

requirements regarding contract 

copyright provisions described in §

35.6595(b)(2). 

Use of Recipient Employees (‘‘Force 

Account’’) Under a Cooperative 

Agreement 

§ 35.6500 General requirements. 

(a) Force Account work is the use of 

the recipient’s own employees or 

equipment for construction, 

construction-related activities 

(including architecture and engineering 

services), or repair or improvement to a 

facility. When using Force Account 

work, the recipient must demonstrate 

that the employees can complete the 

work as competently as, and more 

economically than, contractors, or that 

an emergency necessitates the use of the 

Force Account. 

(b) Where the value of Force Account 

services exceeds the simplified 

acquisition threshold, the recipient 

must receive written authorization for 

use from the award official. 

Procurement Requirements Under a 

Cooperative Agreement 

§ 35.6550 Procurement system standards. 

(a) Recipient standards. (1) In 

addition to the basic procurement 

policies and procedures described in 40 

CFR 31.36(a), the State shall comply 

with the requirements in the following: 

Paragraphs (a)(5), (a)(9), and (b) of this 

section, § § 35.6555(c), 35.6565 (the first 

sentence in this section, the first 

sentence in paragraph (b) of this section, 

and all of paragraph (d) of this section), 

35.6570, 35.6575, and 35.6600. Political 

subdivisions and Tribes must follow all 

of the requirements included or 

referenced in this section through §

35.6610. 

(2) EPA review. EPA reserves the right 

to review any recipient’s procurement 

system or procurement action under a 

Cooperative Agreement. 

(3) Code of conduct. The recipient 

must comply with the requirements of 

40 CFR 31.36(b)(3), which describes 

standards of conduct for employees, 

officers, and agents of the recipient. 

(4) Completion of contractual and 

administrative issues. (i) The recipient 

is responsible for the settlement and 

satisfactory completion in accordance 

with sound business judgment and good 

administrative practice of all contractual 

and administrative issues arising out of 

procurements under the Cooperative 

Agreement. 

(ii) EPA will not substitute its 

judgment for that of the recipient unless 

the matter is primarily a Federal 

concern. 

(iii) Violations of law will be referred 

to the local, State, Tribal, or Federal 

authority having proper jurisdiction. 

(5) Selection procedures. The 

recipient must have written selection 

procedures for procurement 

transactions. 

(i) EPA may not participate in a 

recipient’s selection panel except to 

provide technical assistance. EPA staff 

providing such technical assistance: 

(A) Shall constitute a minority of the 

selection panel (limited to making 

recommendations on qualified offers 

and acceptable proposals based on 

published evaluation criteria) for the 

contractor selection process; and 

(B) Are not permitted to participate in 

the negotiation and award of contracts. 

(ii) When selecting a contractor, 

recipients: 

(A) May not use EPA contractors to 

provide any support related to 

procuring a State contractor. 

(B) May use the Corps of Engineers for 

review of State bidding documents, 

requests for proposals and bids and 

proposals received. 

(6) Award. The recipient may award 

a contract only to a responsible 

contractor, as described in 40 CFR 

31.36(b)(8), and must ensure that each 

contractor performs in accordance with 

all the provisions of the contract. (See 

also § 35.6020.) 

(7) Protest procedures. The recipient 

must comply with the requirements 

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24516 Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 

described in 40 CFR 31.36(b)(12) 

regarding protest procedures. 

(8) Reporting. The recipient must 

comply with the requirements for 

procurement reporting contained in §

35.6665. 

(9) Intergovernmental agreements. (i) 

To foster greater economy and 

efficiency, recipients are encouraged to 

enter into intergovernmental agreements 

for procurement or use of common 

goods and services. 

(ii) Although intergovernmental 

agreements are not subject to the 

requirements set forth in this section 

through § 35.6610, all procurements 

under intergovernmental agreements are 

subject to these requirements except for 

procurements that are: 

(A) Incidental to the purpose of the 

assistance agreement; and 

(B) Made through a central public 

procurement unit. 

(10) Value engineering. The recipient 

is encouraged to include value 

engineering clauses in contracts for 

construction projects of sufficient size to 

offer reasonable opportunities for cost 

reductions. 

(b) Contractor standards—(1) 

Disclosure requirements regarding 

Potentially Responsible Party 

relationships. The recipient must 

require each prospective contractor to 

provide with its bid or proposal: 

(i) Information on its financial and 

business relationship with all PRPs at 

the site and with the contractor’s parent 

companies, subsidiaries, affiliates, 

subcontractors, or current clients at the 

site. Prospective contractors under a 

Core Program Cooperative Agreement 

must provide comparable information 

for all sites within the recipient’s 

jurisdiction. (This disclosure 

requirement encompasses past financial 

and business relationships, including 

services related to any proposed or 

pending litigation, with such parties); 

(ii) Certification that, to the best of its 

knowledge and belief, it has disclosed 

such information or no such 

information exists; and 

(iii) A statement that it shall disclose 

immediately any such information 

discovered after submission of its bid or 

proposal or after award. The recipient 

shall evaluate such information and if a 

member of the contract team has a 

conflict of interest which prevents the 

team from serving the best interests of 

the recipient, the prospective contractor 

may be declared nonresponsible and the 

contract awarded to the next eligible 

bidder or offeror. 

(2) Conflict of interest—(i) Conflict of 

interest notification. The recipient must 

require the contractor to notify the 

recipient of any actual, apparent, or 

potential conflict of interest regarding 

any individual working on a contract 

assignment or having access to 

information regarding the contract. This 

notification shall include both 

organizational conflicts of interest and 

personal conflicts of interest. If a 

personal conflict of interest exists, the 

individual who is affected shall be 

disqualified from taking part in any way 

in the performance of the assigned work 

that created the conflict of interest 

situation. 

(ii) Contract provisions. The recipient 

must incorporate the following 

provisions or their equivalents into all 

contracts, except those for well-drilling, 

fence erecting, plumbing, utility hookups, security guard services, or 

electrical services: 

(A) Contractor data. The contractor 

shall not provide data generated or 

otherwise obtained in the performance 

of contractor responsibilities under a 

contract to any party other than the 

recipient, EPA, or its authorized agents 

for the life of the contract, and for a 

period of five years after completion of 

the contract. 

(B) Employment. The contractor shall 

not accept employment from any party 

other than the recipient or Federal 

agencies for work directly related to the 

site(s) covered under the contract for 

five years after the contract has 

terminated. The recipient agency may 

exempt the contractor from this 

requirement through a written release. 

This release must include EPA 

concurrence. 

(3) Certification of independent price 

determination. The recipient must 

require that each contractor include in 

its bid or proposal a certification of 

independent price determination. This 

document certifies that no collusion, as 

defined by Federal and State antitrust 

laws, occurred during bid preparation. 

(4) Recipient’s Contractors. The 

recipient must require its contractor to 

comply with the requirements in § §

35.6270(a)(1) and (2); 35.6320 (a) and 

(b); 35.6335; 35.6700; and 35.6705. For 

additional contractor requirements, see 

also § 35.6710(c); 35.6590(b); and 

35.6610. 

§ 35.6555 Competition. 

The recipient must conduct all 

procurement transactions in a manner 

providing maximum full and open 

competition. 

(a) Restrictions on competition. 

Inappropriate restrictions on 

competition include the following: 

(1) Placing unreasonable requirements 

on firms in order for them to qualify to 

do business; 

(2) Requiring unnecessary experience 

and excessive bonding requirements; 

(3) Noncompetitive pricing practices 

between firms or between affiliated 

companies; 

(4) Noncompetitive awards to 

consultants that are on retainer 

contracts; 

(5) Organizational conflicts of interest; 

(6) Specifying only a ‘‘brand name’’ 

product, instead of allowing ‘‘an equal’’ 

product to be offered and describing the 

performance of other relevant 

requirements of the procurement; and 

(7) Any arbitrary action in the 

procurement process. 

(b) Geographic and Indian Tribe 

preferences—(1) Geographic. When 

conducting a procurement, the recipient 

must prohibit the use of statutorily or 

administratively imposed in-State or 

local geographical preferences in 

evaluating bids or proposals. However, 

nothing in this section preempts State 

licensing laws. In addition, when 

contracting for architectural and 

engineering (A/E) services, the recipient 

may use geographic location as a 

selection criterion, provided that when 

geographic location is used, its 

application leaves an appropriate 

number of qualified firms, given the 

nature and size of the project, to 

compete for the contract. 

(2) Indian Tribe. Any contract or 

subcontract awarded by an Indian Tribe 

or Indian intertribal consortium shall 

comply with the requirements of 40 CFR 

31.38, ‘‘Indian Self Determination Act.’’ 

(c) Written specifications. The 

recipient’s written specifications must 

include a clear and accurate description 

of the technical requirements and the 

qualitative nature of the material, 

product or service to be procured. 

(1) This description must not contain 

features which unduly restrict 

competition, unless the features are 

necessary to: 

(i) Test or demonstrate a specific 

thing; 

(ii) Provide for necessary 

interchangeability of parts and 

equipment; or 

(iii) Promote innovative technologies. 

(2) The recipient must avoid the use 

of detailed product specifications if at 

all possible. 

(d) Public notice. When soliciting bids 

or proposals, the recipient must allow 

sufficient time (generally 30 calendar 

days) between public notice of the 

proposed project and the deadline for 

receipt of bids or proposals. The 

recipient must publish the public notice 

in professional journals, newspapers, or 

publications of general circulation over 

a reasonable area. 

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(e) Prequalified lists. Recipients may 

use prequalified lists of persons, firms, 

or products to acquire goods and 

services. The list must be current and 

include enough qualified sources to 

ensure maximum open and free 

competition. Recipients must not 

preclude potential bidders from 

qualifying during the solicitation 

period. 

§ 35.6565 Procurement methods. 

The recipient must comply with the 

requirements for payment to consultants 

described in 40 CFR 31.36(j). In 

addition, the recipient must comply 

with the following requirements: 

(a) Small purchase procedures. Small 

purchase procedures are those relatively 

simple and informal procurement 

methods for securing services, supplies, 

or other property that do not cost more 

than the simplified acquisition 

threshold in the aggregate. If small 

purchase procurements are used, the 

recipient must obtain and document 

price or rate quotations from an 

adequate number of qualified sources. 

(b) Sealed bids (formal advertising). 

(For a remedial action award contract, 

except for Architectural/Engineering 

services and post-removal site control, 

the recipient must obtain the award 

official’s approval to use a procurement 

method other than the sealed bid 

method.) Bids are publicly solicited and 

a fixed-price contract (lump sum or unit 

price) is awarded to the responsible 

bidder whose bid, conforming with all 

the material terms and conditions of the 

invitation for bids, is the lowest in 

price. 

(1) In order for the recipient to use the 

sealed bid method, the following 

conditions must be met: 

(i) A complete, adequate, and realistic 

specification or purchase description is 

available; 

(ii) Two or more responsible bidders 

are willing and able to compete 

effectively for the business; and 

(iii) The procurement lends itself to a 

fixed-price contract and the selection of 

the successful bidder can be made 

principally on the basis of price. 

(2) If the recipient uses the sealed bid 

method, the recipient must comply with 

the following requirements: 

(i) Publicly advertise the invitation for 

bids and solicit bids from an adequate 

number of known suppliers, providing 

them sufficient time prior to the date set 

for opening the bids; 

(ii) The invitation for bids, which 

must include any specifications and 

pertinent attachments, must define the 

items or services in order for the bidder 

to properly respond; 

(iii) Publicly open all bids at the time 

and place prescribed in the invitation 

for bids; 

(iv) Award the fixed-price contract in 

writing to the lowest responsive and 

responsible bidder. Where specified in 

bidding documents, the recipient shall 

consider factors such as discounts, 

transportation cost, and life cycle costs 

in determining which bid is lowest. The 

recipient may only use payment 

discounts to determine the low bid 

when prior experience indicates that 

such discounts are usually taken 

advantage of; and 

(v) If there is a sound documented 

reason, the recipient may reject any or 

all bids. 

(c) Competitive proposals. The 

technique of competitive proposals is 

normally conducted with more than one 

source submitting an offer, and either a 

fixed-price or cost-reimbursement type 

contract is awarded. It is generally used 

when conditions are not appropriate for 

the use of sealed bids. If the recipient 

uses the competitive proposal method, 

the following requirements apply: 

(1) Recipients must publicize requests 

for proposals and all evaluation factors 

and must identify their relative 

importance. The recipient must honor 

any response to publicized requests for 

proposals to the maximum extent 

practical; 

(2) Recipients must solicit proposals 

from an adequate number of qualified 

sources; 

(3) Recipients must have a method for 

conducting technical evaluations of the 

proposals received and for selecting 

awardees; 

(4) Recipients must award the 

contract to the responsible firm whose 

proposal is most advantageous to the 

program, with price and other factors 

considered; and 

(5) Recipients may use competitive 

proposal procedures for qualificationsbased procurement of architectural/ 

engineering (A/E) professional services 

whereby competitor’s qualifications are 

evaluated and the most qualified 

competitor is selected, subject to 

negotiation of fair and reasonable 

compensation. This method, where 

price is not used as a selection factor, 

may only be used in the procurement of 

A/E professional services. The recipient 

may not use this method to purchase 

other types of services even though A/ 

E firms are a potential source to perform 

the proposed effort. 

(d) Noncompetitive proposals. (1) The 

recipient may procure by 

noncompetitive proposals only when 

the award of a contract is infeasible 

under small purchase procedures, 

sealed bids or competitive proposals, 

and one of the following circumstances 

applies: 

(i) The item is available only from a 

single source; 

(ii) The public exigency or emergency 

for the requirement will not permit a 

delay resulting from competitive 

solicitation (a declaration of an 

emergency under State law does not 

necessarily constitute an emergency 

under the EPA Superfund program’s 

criteria); 

(iii) The award official authorized 

noncompetitive proposals; or 

(iv) After solicitation of a number of 

sources, competition is determined to be 

inadequate. 

(2) When using noncompetitive 

procurement, the recipient must 

conduct a cost analysis in accordance 

with the requirements described in §

35.6585. 

§ 35.6570 Use of the same engineer 

during subsequent phases of response. 

(a) If the public notice clearly stated 

the possibility that the firm or 

individual selected could be awarded a 

contract for follow-on services and 

initial procurement complied with the 

procurement requirements, the recipient 

of a CERCLA remedial response 

Cooperative Agreement may use the 

engineer procured to conduct any or all 

of the follow-on engineering activities 

without going through the public notice 

and evaluation procedures. 

(b) The recipient may also use the 

same engineer during subsequent 

phases of the project in the following 

cases: 

(1) Where the recipient conducted the 

RI, FS, or design activities without EPA 

assistance but is using CERCLA funds 

for follow-on activities, the recipient 

may use the engineer for subsequent 

work provided the recipient certifies: 

(i) That it complied with the 

procurement requirements in § 35.6565 

when it selected the engineer and the 

code of conduct requirements described 

in 40 CFR 31.36(b)(3). 

(ii) That any CERCLA-funded contract 

between the engineer and the recipient 

meets all of the other provisions as 

described in the procurement 

requirements in this subpart. 

(2) Where EPA conducted the RI, FS, 

or design activities but the recipient will 

assume the responsibility for 

subsequent phases of response under a 

Cooperative Agreement, the recipient 

may use, with the award official’s 

approval, EPA’s engineer contractor 

without further public notice or 

evaluation provided the recipient 

follows the rest of the procurement 

requirements to award the contract. 

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24518 Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 

§ 35.6575 Restrictions on types of 

contracts. 

(a) Prohibited contracts. The 

recipient’s procurement system must 

not allow cost-plus-percentage-of-cost 

(e.g., a multiplier which includes profit) 

or percentage-of-construction-cost types 

of contracts. 

(b) Removal. Under a removal 

Cooperative Agreement, the recipient 

must award a fixed-price contract (lump 

sum, unit price, or a combination of the 

two) when procuring contractor 

support, regardless of the procurement 

method selected, unless the recipient 

obtains the award official’s prior written 

approval. 

(c) Time and material contracts. The 

recipient may use time and material 

contracts only if no other type of 

contract is suitable, and if the contract 

includes a ceiling price that the 

contractor exceeds at its own risk. 

§ 35.6580 Contracting with minority and 

women’s business enterprises (MBE/WBE), 

small businesses, and labor surplus area 

firms. 

(a) Procedures. The recipient must 

comply with the six steps described in 

40 CFR 31.36(e)(2) to ensure that MBEs, 

WBEs, and small businesses are used 

whenever possible as sources of 

supplies, construction, and services. 

Tasks to encourage small, minority, and 

women’s business utilization in the 

Superfund program are eligible for 

funding under Core Program 

Cooperative Agreements. 

(b) Labor surplus firms. EPA 

encourages recipients to procure 

supplies and services from labor surplus 

area firms. 

(c) ‘‘Fair share’’ objectives. It is EPA’s 

policy that recipients award a fair share 

of contracts to small, minority and 

women’s businesses. The policy 

requires that fair share objectives for 

minority and women-owned business 

enterprises be negotiated with the States 

and/or recipients, but does not require 

fair share objectives be established for 

small businesses. 

(1) Each recipient must establish an 

annual ‘‘fair share’’ objective for MBE 

and WBE use. A recipient is not 

required to attain a particular statistical 

level of participation by race, ethnicity, 

or gender of the contractor’s owners or 

managers. 

(2) If the recipient is awarded more 

than one Cooperative Agreement during 

the year, the recipient may negotiate an 

annual fair share for all Cooperative 

Agreements for that year. It is not 

necessary to have a fair share for each 

Cooperative Agreement. When a 

Cooperative Agreement is awarded to a 

recipient with which a ‘‘fair share’’ 

agreement has not been negotiated, the 

recipient must not award any contracts 

under the Cooperative Agreement until 

the recipient has negotiated a fair share 

objective with EPA. 

§ 35.6585 Cost and price analysis. 

(a) General. The recipient must 

conduct and document a cost or price 

analysis in connection with every 

procurement action including contract 

modification. 

(1) Cost analysis. The recipient must 

conduct and document a cost analysis 

for all negotiated contracts over the 

simplified acquisition threshold and for 

all change orders regardless of price. A 

cost analysis is not required when 

adequate price competition exists and 

the recipient can establish price 

reasonableness. The recipient must base 

its determination of price 

reasonableness on a catalog or market 

price of a commercial product sold in 

substantial quantities to the general 

public, or on prices set by law or 

regulation. 

(2) Price analysis. In all instances 

other than those described in paragraph 

(a)(1) of this section, the recipient must 

perform a price analysis to determine 

the reasonableness of the proposed 

contract price. 

(b) Profit analysis. For each contract 

in which there is no price competition 

and in all cases in which cost analysis 

is performed, the recipient must 

negotiate profit as a separate element of 

the price. To establish a fair and 

reasonable profit, consideration will be 

given to the complexity of the work to 

be performed, the risk borne by the 

contractor, the contractor’s investment, 

the amount of subcontracting, the 

quality of its record of past performance, 

and industry profit rates in the 

surrounding geographical area for 

similar work. 

§ 35.6590 Bonding and insurance. 

(a) General. The recipient must meet 

the requirements regarding bonding 

described in 40 CFR 31.36(h). The 

recipient must clearly and accurately 

state in the contract documents the 

bonds and insurance requirements, 

including the amounts of security 

coverage that a bidder or offeror must 

provide. 

(b) Accidents and catastrophic loss. 

The recipient must require the 

contractor to provide insurance against 

accidents and catastrophic loss to 

manage any risk inherent in completing 

the project. 

§ 35.6595 Contract provisions. 

(a) General. Each contract must be a 

sound and complete agreement, and 

include the following provisions: 

(1) Nature, scope, and extent of work 

to be performed; 

(2) Time frame for performance; 

(3) Total cost of the contract; and 

(4) Payment provisions. 

(b) Other contract provisions. 

Recipients’ contracts must include the 

following provisions: 

(1) Energy efficiency. A contract must 

comply with mandatory standards and 

policies on energy efficiency contained 

in the State’s energy conservation plan, 

which is issued under 10 CFR part 420. 

(2) Patents inventions, and copyrights. 

All contracts must include notice of 

EPA requirements and regulations 

pertaining to reporting and patent rights 

under any contract involving research, 

developmental, experimental or 

demonstration work with respect to any 

discovery or invention which arises or 

is developed while conducting work 

under a contract. This notice shall also 

include EPA requirements and 

regulations pertaining to copyrights and 

rights to data contained in 40 CFR 

31.34. 

(3) Labor standards. The recipient 

must comply with 40 CFR 31.36(i)(3) 

through (6). 

(4) Conflict of interest. The recipient 

must include provisions pertaining to 

conflict of interest as described in §

35.6550(b)(2)(ii). 

§ 35.6600 Contractor claims. 

(a) General. The recipient must 

conduct an administrative and technical 

review of each claim before EPA will 

consider funding these costs. 

(b) Claims settlement. The recipient 

may incur costs (including legal, 

technical and administrative) to assess 

the merits of or to negotiate the 

settlement of a claim by or against the 

recipient under a contract, provided: 

(1) The claim arises from work within 

the scope of the Cooperative Agreement; 

(2) A formal Cooperative Agreement 

amendment is executed specifically 

covering the costs before they are 

incurred; 

(3) The costs are not incurred to 

prepare documentation that should be 

prepared by the contractor to support a 

claim against the recipient; and 

(4) The award official determines that 

there is a significant Federal interest in 

the issues involved in the claim. 

(c) Claims defense. The recipient may 

incur costs (including legal, technical 

and administrative) to defend against a 

contractor claim for increased costs 

under a contract or to prosecute a claim 

to enforce a contract provided: 

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(1) The claim arises from work within 

the scope of the Cooperative Agreement; (2) A formal Cooperative Agreement 

amendment is executed specifically 

covering the costs before they are 

incurred; 

(3) Settlement of the claim cannot 

occur without arbitration or litigation; (4) The claim does not result from the 

recipient’s mismanagement; (5) The award official determines that 

there is a significant Federal interest in 

the issues involved in the claim; and 

(6) In the case of defending against a 

contractor claim, the claim does not 

result from the recipient’s responsibility 

for the improper action of others. 

§ 35.6605 Privity of contract. 

Neither EPA nor the United States 

shall be a party to any contract nor to 

any solicitation or request for proposals. 

§ 35.6610 Contracts awarded by a 

contractor. 

The recipient must require its 

contractor to comply with the following 

provisions in the award of contracts (i.e. 

subcontracts). (This section does not 

apply to a supplier’s procurement of 

materials to produce equipment, 

materials and catalog, off-the-shelf, or 

manufactured items.) 

(a) The requirements referenced in §

35.6020. 

(b) The limitations on contract award 

in § 35.6550(a)(6). 

(c) The requirements regarding 

minority and women’s business 

enterprises, and small business in §

35.6580. 

(d) The requirements regarding 

specifications in § 35.6555 (a)(6) and 

(c). 

(e) The Federal cost principles in 40 

CFR 31.22. 

(f) The prohibited types of contracts 

in § 35.6575(a). 

(g) The cost, price analysis, and profit 

analysis requirements in § 35.6585. (h) The applicable provisions in §

35.6595 (b). 

(i) The applicable provisions in §

35.6555(b)(2). 

Reports Required Under a Cooperative 

Agreement 

§ 35.6650 Progress reports. 

(a) Reporting frequency. The recipient 

must submit progress reports as 

specified in the Cooperative Agreement. 

Progress reports will be required no 

more frequently than quarterly, and will 

be required at least annually. The 

reports shall be due within 30 days after 

the reporting period. The final progress 

report shall be due 90 days after 

expiration or termination of the 

Cooperative Agreement. (b) Content. The progress report must 

contain the following information: 

(1) An explanation of work 

accomplished during the reporting 

period, delays, or other problems, if any, 

and a description of the corrective 

measures that are planned. For preremedial Cooperative Agreements, the 

report must include a list of the sitespecific products completed and the 

estimated number of technical hours 

spent to complete each product. 

(2) A comparison of the percentage of 

the project completed to the project 

schedule, and an explanation of 

significant discrepancies. 

(3) A comparison of the estimated 

funds spent to date to planned 

expenditures and an explanation of 

significant discrepancies. For remedial, 

enforcement, and removal reports, the 

comparison must be on a per task basis. 

(4) An estimate of the time and funds 

needed to complete the work required 

in the Cooperative Agreement, a 

comparison of that estimate to the time 

and funds remaining, and a justification 

for any increase. 

§ 35.6655 Notification of significant 

developments. 

Events may occur between the 

scheduled performance reporting dates 

which have significant impact upon the 

Cooperative Agreement-supported 

activity. In such cases, the recipient 

must inform the EPA project officer as 

soon as the following types of 

conditions become known: 

(a) Problems, delays, or adverse 

conditions which will materially impair 

the ability to meet the objective of the 

award. This disclosure must include a 

statement of the action taken, or 

contemplated, and any assistance 

needed to resolve the situation. 

(b) Favorable developments which 

enable meeting time schedules and 

objectives sooner or at less cost than 

anticipated or producing more 

beneficial results than originally 

planned. 

§ 35.6660 Property inventory reports. 

(a) CERCLA-funded property—(1) 

Content. The report must contain the 

following information: 

(i) Classification and value of 

remaining supplies; 

(ii) Description of all equipment 

purchased with CERCLA funds, 

including its current condition; 

(iii) Verification of the current use 

and continued need for the equipment 

by site, activity, and operable unit, as 

applicable; 

(iv) Notification of any property 

which has been stolen or vandalized; 

and 

(v) A request for disposition 

instructions for any equipment no 

longer needed on the project. 

(2) Reporting frequency. The recipient 

must submit an inventory report to EPA 

at the following times: 

(i) Within 90 days after completing 

any CERCLA-funded project or any 

response activity at a site; and 

(ii) When the equipment is no longer 

needed for any CERCLA-funded project 

or any response activity at a site. 

(b) Federally owned property—(1) 

Content. The recipient must include the 

following information for each federally 

owned item in the inventory report: 

(i) Description; 

(ii) Decal number; 

(iii) Current condition; and 

(iv) Request for disposition 

instructions. 

(2) Reporting frequency. The recipient 

must submit an inventory report to the 

appropriate EPA property accountable 

officer at the following times: 

(i) Annually, due to EPA on the 

anniversary date of the award; 

(ii) When the property is no longer 

needed; and 

(iii) Within 90 days after the end of 

the project period. 

§ 35.6665 Procurement report. 

(a) The recipient must report on its 

use of MBE (minority business 

enterprise) and WBE (women’s business 

enterprise) firms by submitting a 

completed Minority and Women’s 

Business Utilization Report (SF–334) to 

the award official. Reporting 

commences with the recipient’s award 

of its first contract and continues until 

it and its contractors have awarded their 

last contract for the activities or tasks 

identified in the Cooperative 

Agreement. The recipient must submit 

the MBE/WBE Utilization Report within 

30 days after the end of each Federal 

fiscal quarter, regardless of whether the 

recipient awards a contract to an MBE 

or WBE during that quarter. 

(b) The recipient must also report on 

its efforts to encourage MBE 

participation in the Superfund program 

pursuant to CERCLA Sec. 105(f). 

Information on the recipient’s efforts to 

encourage MBE participation in the 

Superfund program may be included in 

each SF–334 submitted quarterly, but is 

required in the SF–334 submitted for 

the fourth quarter, due November 1 of 

each year. 

§ 35.6670 Financial reports. 

(a) General. The recipient must 

comply with the requirements regarding 

financial reporting described in 40 CFR 

31.41. 

(b) Financial Status Report—(1) 

Content. (i) The Financial Status Report 

(SF–269) must include financial 

information by site, activity, and 

operable unit, as applicable. 

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(ii) A final Financial Status Report 

(FSR) must have no unliquidated 

obligations. If any obligations remain 

unliquidated, the FSR is considered an 

interim report and the recipient must 

submit a final FSR to EPA after 

liquidating all obligations. 

(2) Reporting frequency. The recipient 

must file a Financial Status Report as 

follows: 

(i) Annually due 90 days after the end 

of the Federal fiscal year or as specified 

in the Cooperative Agreement; or if 

quarterly or semiannual reports are 

required in accordance with 40 CFR 

31.41(b)(3), due 30 days after the 

reporting period; 

(ii) Within 90 calendar days after 

completing each CERCLA-funded 

response activity at a site (submit the 

FSR only for each completed activity); 

and 

(iii) Within 90 calendar days after 

termination or closeout of the 

Cooperative Agreement. 

Records Requirements Under a 

Cooperative Agreement 

§ 35.6700 Project records. 

The lead agency for the response 

action must compile and maintain an 

administrative record consistent with 

section 113 of CERCLA, the National 

Contingency Plan, and relevant EPA 

policy and guidance. In addition, 

recipients of assistance (whether lead or 

support agency) are responsible for 

maintaining project files described as 

follows. 

(a) General. The recipient must 

maintain project records by site, 

activity, and operable unit, as 

applicable. 

(b) Financial records. The recipient 

must maintain records which support 

the following items: 

(1) Amount of funds received and 

expended; and 

(2) Direct and indirect project cost. 

(c) Property records. The recipient 

must maintain records which support 

the following items: 

(1) Description of the property; 

(2) Manufacturer’s serial number, 

model number, or other identification 

number; 

(3) Source of the property, including 

the assistance identification number; 

(4) Information regarding whether the 

title is vested in the recipient or EPA; 

(5) Unit acquisition date and cost; 

(6) Percentage of EPA’s interest; 

(7) Location, use and condition (by 

site, activity, and operable unit, as 

applicable) and the date this 

information was recorded; and 

(8) Ultimate disposition data, 

including the sales price or the method 

used to determine the price, or the 

method used to determine the value of 

EPA’s interest for which the recipient 

compensates EPA in accordance with 

§ § 35.6340, 35.6345, and 35.6350. 

(d) Procurement records—(1) General. 

The recipient must maintain records 

which support the following items, and 

must make them available to the public: 

(i) The reasons for rejecting any or all 

bids; and 

(ii) The justification for a procurement 

made on a noncompetitively negotiated 

basis. 

(2) Procurements in excess of the 

simplified acquisition threshold. The 

recipient’s records and files for 

procurements in excess of the simplified 

acquisition threshold must include the 

following information, in addition to the 

information required in paragraph (d)(1) 

of this section: 

(i) The basis for contractor selection; 

(ii) A written justification for selecting 

the procurement method; 

(iii) A written justification for use of 

any specification which does not 

provide for maximum free and open 

competition; 

(iv) A written justification for the 

choice of contract type; and 

(v) The basis for award cost or price, 

including a copy of the cost or price 

analysis made in accordance with §

35.6585 and documentation of 

negotiations. 

(e) Other records. The recipient must 

maintain records which support the 

following items: 

(1) Time and attendance records and 

supporting documentation; 

(2) Documentation of compliance 

with statutes and regulations that apply 

to the project; and 

(3) The number of site-specific 

technical hours spent to complete each 

pre-remedial product. 

§ 35.6705 Records retention. 

(a) Applicability. This requirement 

applies to all financial and 

programmatic records, supporting 

documents, statistical records, and other 

records which are required to be 

maintained by the terms, program 

regulations, or the Cooperative 

Agreement, or are otherwise reasonably 

considered as pertinent to program 

regulations or the Cooperative 

Agreement. 

(b) Length of retention period. The 

recipient must maintain all records for 

10 years following submission of the 

final Financial Status Report unless 

otherwise directed by the EPA award 

official, and must obtain written 

approval from the EPA award official 

before destroying any records. If any 

litigation, claim, negotiation, audit, cost 

recovery, or other action involving the 

records has been started before the 

expiration of the ten-year period, the 

records must be retained until 

completion of the action and resolution 

of all issues which arise from it, or until 

the end of the regular ten-year period, 

whichever is later. 

(c) Substitution of an unalterable 

electronic format. An unalterable 

electronic format, acceptable to EPA, 

may be substituted for the original 

records. The copying of any unalterable 

electronic format must be performed in 

accordance with the technical 

regulations concerning Federal 

Government records (36 CFR parts 1220 

through 1234) and EPA records 

management requirements. 

(d) Starting date of retention period. 

The recipient must comply with the 

requirements regarding the starting 

dates for records retention described in 

40 CFR 31.42(c) (1) and (2). 

§ 35.6710 Records access. 

(a) Recipient requirements. The 

recipient must comply with the 

requirements regarding records access 

described in 40 CFR 31.42(e). 

(b) Availability of records. The 

recipient must, with the exception of 

certain policy, deliberative, and 

enforcement documents which may be 

held confidential, ensure that all files 

are available to the public. 

(c) Contractor requirements. The 

recipient must require its contractor to 

comply with the requirements regarding 

records access described in 40 CFR 

31.36(i)(10). 

Other Administrative Requirements for 

Cooperative Agreements 

§ 35.6750 Modifications. 

The recipient must comply with the 

requirements regarding changes to the 

Cooperative Agreement described in 40 

CFR 31.30. 

§ 35.6755 Monitoring program 

performance. 

The recipient must comply with the 

requirements regarding program 

performance monitoring described in 40 

CFR 31.40 (a) and (e). 

§ 35.6760 Enforcement and termination 

for convenience. 

The recipient must comply with all 

terms and conditions in the Cooperative 

Agreement, and is subject to the 

requirements regarding enforcement of 

the terms of an award and termination 

for convenience described in 40 CFR 

31.43 and 31.44. 

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§ 35.6765 Non-Federal audit. 

The recipient must comply with the 

requirements regarding non-Federal 

audits described in 40 CFR 31.26. 

§ 35.6770 Disputes. 

The recipient must comply with the 

requirements regarding dispute 

resolution procedures described in 40 

CFR 31.70. 

§ 35.6775 Exclusion of third-party 

benefits. 

The Cooperative Agreement benefits 

only the signatories to the Cooperative 

Agreement. 

§ 35.6780 Closeout. 

(a) Closeout of a Cooperative 

Agreement, or an activity under a 

Cooperative Agreement, can take place 

in the following situations: 

(1) After the completion of all work 

for a response activity at a site; or 

(2) After all activities under a 

Cooperative Agreement have been 

completed; or 

(3) Upon termination of the 

Cooperative Agreement. 

(b) The recipient must comply with 

the closeout requirements described in 

40 CFR 31.50 and 31.51. 

(c) After closeout, EPA may monitor 

the recipients’ compliance with the 

assurance to provide all future operation 

and maintenance as required by 

CERCLA section 104(c) and addressed 

in 40 CFR 300.510(c)(1) of the NCP. 

§ 35.6785 Collection of amounts due. 

The recipient must comply with the 

requirements described in 40 CFR 31.52, 

regarding collection of amounts due. 

§ 35.6790 High risk recipients. 

If EPA determines that a recipient is 

not responsible, EPA may impose 

restrictions on the award as described in 

40 CFR 31.12. 

Requirements for Administering a 

Superfund State Contract (SSC) 

§ 35.6800 Superfund State Contract. 

A Superfund State Contract (SSC) 

with a State is required before EPA can 

obligate or expend funds for a remedial 

action at a site within the State and 

before EPA or a political subdivision 

can conduct the remedial action. An 

SSC also ensures State or Indian Tribe 

involvement consistent with CERCLA 

sections 121(f) and 126, respectively, 

and obtains the required section 104 

assurances (See § 35.6105(b)). An SSC 

may also be used to document the roles 

and responsibilities of a State, Indian 

Tribe, and political subdivision during 

any response action at a site. A political 

subdivision may be a signatory to the 

SSC. 

§ 35.6805 Contents of an SSC. 

The SSC must include the following 

provisions: 

(a) General authorities, which 

documents the relevant statutes and 

regulations (of each government entity 

that is a party to the contract) governing 

the contract. 

(b) Purpose of the SSC, which 

describes the response activities to be 

conducted and the benefits to be 

derived. 

(c) Negation of agency relationship 

between the signatories, which states 

that no signatory of the SSC can 

represent or act on the behalf of any 

other signatory in any matter associated 

with the SSC. 

(d) A site description, pursuant to §

35.6105(a)(2)(i). 

(e) A site-specific Statement of Work, 

pursuant to § 35.6105(a)(2)(ii) and a 

statement of whether the contract 

constitutes an initial SSC or an 

amendment to an existing contract. 

(f) A statement of intention to follow 

EPA policy and guidance. 

(g) A project schedule to be prepared 

during response activities. 

(h) A statement designating a primary 

contact for each party to the contract, 

which designates representatives to act 

on behalf of each signatory in the 

implementation of the contract. This 

statement must document the authority 

of each project manager to approve 

modifications to the project so long as 

such changes are within the scope of the 

contract and do not significantly impact 

the SSC. 

(i) The CERCLA assurances, as 

appropriate, described as follows: 

(1) Operation and maintenance. The 

State must provide an assurance 

pursuant to § 35.6105(b)(1). The State’s 

responsibility for operation and 

maintenance generally begins when 

EPA determines that the remedy is 

operational and functional or one year 

after construction completion, 

whichever is sooner (See, 40 CFR 

300.435(f)). 

(2) Twenty-year waste capacity. The 

State must provide an assurance 

pursuant to § 35.6105(b)(3). 

(3) Off-site storage, treatment, or 

disposal. If off-site storage, destruction, 

treatment, or disposal is required, the 

State must provide an assurance 

pursuant to § 35.6105(b)(4); the 

political subdivision may not provide 

this assurance. 

(4) Real property acquisition. When 

real property must be acquired, the State 

must provide an assurance pursuant to 

§ 35.6105(b)(5). 

(5) Provision of State cost share. The 

State must provide assurances for cost 

sharing pursuant to § 35.6105(b)(2). 

Even if the political subdivision is 

providing the actual cost share, the State 

must guarantee payment of the cost 

share in the event of default by the 

political subdivision. 

(j) Cost share conditions, which 

include: 

(1) An estimate of the response action 

cost (excluding EPA’s indirect costs) 

that requires cost share; 

(2) The basis for arriving at this figure 

(See § 35.6285(c) for credit provisions); 

and 

(3) The payment schedule as 

negotiated by the signatories, and 

consistent with either a lump-sum or 

incremental-payment option. Upon 

completion of activities in the sitespecific Statement of Work, EPA shall 

invoice the State for its final payment, 

with the exception of any change orders 

and claims handled during 

reconciliation of the SSC. 

(k) Reconciliation provision, which 

states that the SSC remains in effect 

until the financial settlement of project 

costs and final reconciliation of 

response costs (including all change 

orders, claims, overpayments, 

reimbursements, etc.) ensure that both 

EPA and the State have satisfied the cost 

share requirement contained in section 

104 of CERCLA, as amended. 

Overpayments in an SSC may not be 

used to meet the cost-sharing obligation 

at another site. Reimbursements for any 

overpayment will be made to the payer 

identified in the SSC. 

(l) Amendability of the SSC, which 

provides that: 

(1) Formal amendments are required 

when alterations to CERCLA-funded 

activities are necessary or when 

alterations impact the State’s assurances 

pursuant to the National Contingency 

Plan and CERCLA, as amended. Such 

amendments must include a Statement 

of Work for the amendment as described 

in paragraph (e) of this section; and 

(2) Any change(s) in the SSC must be 

agreed to, in writing, by the signatories, 

except as provided elsewhere in the 

SSC, and must be reflected in all 

response agreements affected by the 

change(s). 

(m) List of support agency 

Cooperative Agreements that are also in 

place for the site. 

(n) Litigation, which describes EPA’s 

right to bring an action against any party 

under section 106 of CERCLA to compel 

cleanup, or for cost recovery under 

section 107 of CERCLA. 

(o) Sanctions for failure to comply 

with SSC terms, which states that if the 

signatories fail to comply with the terms 

of the SSC, EPA may proceed under the 

provisions of section 104(d)(2) of 

CERCLA and may seek in the 

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24522 Federal Register / Vol. 72, No. 84 / Wednesday, May 2, 2007 / Rules and Regulations 

appropriate court of competent 

jurisdiction to enforce the SSC or to 

recover any funds advanced or any costs 

incurred due to a breach of the SSC. 

Other signatories to the SSC may seek 

remedies in the appropriate court of 

competent jurisdiction. 

(p) Site access. The State or political 

subdivision or Indian Tribe is expected 

to use its own authority to secure access 

to the site and adjacent properties, as 

well as all rights-of-way and easements 

necessary to complete the response 

actions undertaken pursuant to the SSC. 

(q) Final inspection of the remedy. 

The SSC must include a statement that 

following completion of the remedial 

action, the State and EPA shall jointly 

inspect the project to determine that the 

remedy is functioning properly and is 

performing as designed. 

(r) Exclusion of third-party benefits, 

which states that the SSC is intended to 

benefit only the signatories of the SSC, 

and extends no benefit or right to any 

third party not a signatory to the SSC. 

(s) Any other provision deemed 

necessary by all parties to facilitate the 

response activities covered by the SSC. 

(t) State review. The State or Indian 

Tribe must review and comment on the 

response actions pursuant to the SSC. 

Unless otherwise stated in the SSC, all 

time frames for review must follow 

those prescribed in the NCP (40 CFR 

part 300). 

(u) Responsible party activities, which 

states that if a Responsible Party takes 

over any activities at the site, the SSC 

will be modified or terminated, as 

appropriate. 

(v) Out-of-State or out-of-an-IndianTribal-area-of-Indian-country transfers 

of CERCLA waste, which states that, 

unless otherwise provided for by EPA or 

a political subdivision, the State or 

Indian Tribe must provide the 

notification requirements described in §

35.6120. 

§ 35.6815 Administrative requirements. 

In addition to the requirements 

specified in § 35.6805, the State and/or 

political subdivision must comply with 

the following: 

(a) Financial administration. The 

State and/or political subdivision must 

comply with the following requirements 

regarding financial administration: 

(1) Payment. The State may pay for its 

share of the costs of the response 

activities in cash or credit. As 

appropriate, specific credit provisions 

should be included in the SSC 

consistent with the requirements 

described in § 35.6285(c). The State 

may not pay for its cost share using inkind services, unless the State has 

entered into a support agency 

Cooperative Agreement with EPA. The 

use of the support agency Cooperative 

Agreement as a vehicle for providing 

cost share must be documented in the 

SSC. If the political subdivision agrees 

to provide all or part of the State’s cost 

share pursuant to a political 

subdivision-lead Cooperative 

Agreement, the political subdivision 

may pay for those costs in cash or inkind services under that agreement. The 

use of a political subdivision-lead 

Cooperative Agreement as a vehicle for 

providing cost share must also be 

documented in the SSC. The specific 

payment terms must be documented in 

the SSC pursuant to § 35.6805. 

(2) Collection of amounts due. The 

State and/or political subdivision must 

comply with the requirements described 

in 40 CFR 31.52(a) regarding collection 

of amounts due. 

(3) Failure to comply with negotiated 

payment terms. Failure to comply with 

negotiated payment terms may be 

construed as default by the State on its 

required assurances, even if the political 

subdivision is responsible for providing 

all or part of the cost share. (See §

35.6805(i)(5).) 

(b) Personal property. The State, 

Indian Tribe, or political subdivision is 

required to accept title. The following 

requirements apply to equipment used 

as all or part of the remedy: 

(1) Fixed in-place equipment. EPA no 

longer has an interest in fixed in-place 

equipment once the equipment is 

installed. 

(2) Equipment that is an integral part 

of services to individuals. EPA no longer 

has an interest in equipment that is an 

integral part of services to individuals, 

such as pipes, lines, or pumps providing 

hookups for homeowners on an existing 

water distribution system, once EPA 

certifies that the remedy is operational 

and functional. 

(c) Reports. The State and/or political 

subdivision or Indian Tribe must 

comply with the following requirements 

regarding reports: 

(1) EPA-lead. The nature and 

frequency of reports between EPA and 

the State or Indian Tribe will be 

specified in the SSC. 

(2) Political subdivision-lead. The 

political subdivision must submit to the 

State a copy of all reports which the 

political subdivision is required to 

submit to EPA in accordance with the 

requirements of its Cooperative 

Agreement. (See § 35.6650 for 

requirements regarding progress 

reports.) 

(d) Records. The State and political 

subdivision or Indian Tribe must 

maintain records on a site-specific basis. 

The State and political subdivision or 

Indian Tribe must comply with the 

requirements regarding record retention 

described in § 35.6705 and the 

requirements regarding record access 

described in § 35.6710. 

§ 35.6820 Conclusion of the SSC. 

(a) In order to conclude the SSC, the 

signatories must: 

(1) Satisfactorily complete the 

response activities at the site and make 

all payments based upon project costs 

determined in § 35.6805(j); 

(2) Produce a final accounting of all 

project costs, including change orders 

and outstanding contractor claims; 

(3) Submit all State cost share 

payments to EPA (See § 35.6805(i)(5)); 

(4) Assume responsibility for all 

future operation and maintenance as 

required by CERCLA section 104(c) and 

addressed in 40 CFR 300.510 (c)(1) of 

the NCP, and if applicable, accept 

transfer of any Federal interest in real 

property (See § 35.6805(i)(4)). 

(b) After the administrative 

conclusion of the Superfund State 

Contract, EPA may monitor the 

signatory’s compliance with assurances 

to provide all future operation and 

maintenance as required by CERCLA 

section 104(c) and addressed in 40 CFR 

300.510(c)(1) of the NCP. 

[FR Doc. E7–7990 Filed 5–1–07; 8:45 am] 

BILLING CODE 6560–50–P 

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