II

104TH CONGRESS

2D SESSION S. 2028

To assist the States and local governments in assessing and remediating

brownfields and encouraging environmental cleanup programs, and for

other purposes.

IN THE SENATE OF THE UNITED STATES

AUGUST 2, 1996

Mr. LAUTENBERG (for himself, Mr. BAUCUS, Mr. REID, Mr. GRAHAM, and

Mr. MOYNIHAN) introduced the following bill; which was read twice and

referred to the Committee on Environment and Public Works

A BILL

To assist the States and local governments in assessing and

remediating brownfields and encouraging environmental

cleanup programs, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Brownfields and Envi5 ronmental Cleanup Act of 1996’’.

6 SEC. 2. FINDINGS AND PURPOSE.

7 (a) FINDINGS.—Congress finds that—

8 (1) past uses of land in the United States for

9 industrial and commercial purposes have created
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1 many sites throughout the United States that have

2 environmental contamination;

3 (2) Congress and the governments of States

4 and political subdivisions of States have enacted

5 laws to—

6 (A) prevent environmental contamination;

7 and

8 (B) carry out response actions to correct

9 past instances of environmental contamination;

10 (3) many sites are minimally contaminated, do

11 not pose serious threats to human health or the en12 vironment, and can be satisfactorily remediated ex13 peditiously with little government oversight;

14 (4) promoting the assessment, cleanup and re15 development of contaminated sites could lead to sig16 nificant environmental and economic benefits, par17 ticularly in any case in which a cleanup can be com18 pleted quickly and during a period of time that

19 meets short-term business needs;

20 (5) the private market demand for sites af21 fected by environmental contamination frequently is

22 reduced, often due to uncertainties regarding liabil23 ity or potential cleanup costs of innocent land24 owners, lenders, fiduciaries, and prospective pur25 chasers under Federal law;
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1 (6) the abandonment or underutilization of af2 fected sites impairs the ability of the Federal Gov3 ernment and the governments of States and political

4 subdivisions of States to provide economic opportu5 nities for the people of the United States, particu6 larly the unemployed and economically disadvan7 taged;

8 (7) the abandonment or underuse of affected

9 sites also results in the inefficient use of public fa10 cilities and services, as well as land and other natu11 ral resources, and extends conditions of blight in

12 local communities;

13 (8) cooperation among Federal agencies, de14 partments and agencies of States and political sub15 divisions of States, local community development or16 ganizations, and current owners and prospective

17 purchasers of affected sites is required to accomplish

18 timely response actions and the redevelopment or

19 reuse of affected sites;

20 (9) there is a need for a program to—

21 (A) encourage cleanups of affected sites;

22 and

23 (B) facilitate the establishment and en24 hancement of programs by States and local gov-
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1 ernments to foster cleanups of affected site

2 through capitalization of loan programs; and

3 (10) there is a need to provide financial incen4 tives and assistance to characterize certain affected

5 sites and facilitate the cleanup of the sites so that

6 the sites may be redeveloped for beneficial uses.

7 (b) PURPOSE.—The purpose of this Act is to create

8 new business and employment opportunities through the

9 economic redevelopment of affected sites that generally do

10 not pose a serious threat to human health or the environ11 ment and to stimulate the assessment and cleanup of af12 fected sites by—

13 (1) encouraging States and local governments

14 to provide for characterization and cleanup of sites

15 that may not be remediated under other environ16 mental laws (including regulations) in effect on the

17 date of enactment of this Act;

18 (2) encouraging local governments and private

19 parties, including local community development or20 ganizations, to participate in programs, such as

21 State cleanup programs, that facilitate expedited re22 sponse actions that are consistent with business

23 needs at affected sites;

24 (3) directing the Administrator to establish pro25 grams that provide financial assistance to—
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1 (A) facilitate site assessments of certain

2 affected sites;

3 (B) encourage cleanup of appropriate sites

4 through capitalization of loan programs; and

5 (C) encouraging workforce development in

6 areas adversely affected by contaminated prop7 erties; and

8 (4) reducing transaction costs and paperwork,

9 and preventing needless duplication of effort and

10 delay at all levels of government.

11 SEC. 3. DEFINITIONS.

12 As used in this Act (unless the context clearly re13 quires otherwise):

14 (1) ADMINISTRATIVE COSTS.—The term ‘‘ad15 ministrative costs’’ means eligible costs that are not

16 nonadministrative costs.

17 (2) ADMINISTRATOR.—The term ‘‘Adminis18 trator’’ means the Administrator of the Environ19 mental Protection Agency.

20 (3) AFFECTED SITE.—

21 (A) IN GENERAL.—Except as provided in sub22 paragraph (B), the term ‘‘affected site’’ means a fa23 cility that has or is suspected of having environ24 mental contamination that—
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1 (i) could prevent the timely use, devel2 opment, reuse, or redevelopment of the fa3 cility; and

4 (ii) is relatively limited in scope or se5 verity and can be comprehensively charac6 terized and readily analyzed.

7 (B) EXCEPTIONS.—The term does not in8 clude—

9 (i) any facility that is the subject of a

10 planned or an ongoing response action

11 under the Comprehensive Environmental

12 Response, Compensation, and Liability Act

13 of 1980 (42 U.S.C. 9601 et seq.), except

14 that the term includes a facility for which

15 a preliminary assessment, site investigation

16 or removal action has been completed and

17 with respect to which the Administrator

18 has decided not to take further response

19 action, including cost recovery action;

20 (ii) any facility included, or proposed

21 for inclusion, on the National Priorities

22 List maintained by the Administrator

23 under such Act;

24 (iii) any facility with respect to which

25 a record of decision, other than a no-action
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1 record of decision, has been issued by the

2 President under section 104 of the Com3 prehensive Environmental Response, Com4 pensation, and Liability Act of 1980 (42

5 U.S.C. 9604) with respect to the facility;

6 (iv) any facility that is subject to cor7 rective action under section 3004(u) or

8 3008(h) of the Solid Waste Disposal Act

9 (42 U.S.C. 6924(u) or 6928(h)) at the

10 time that an application for loan assistance

11 with respect to the facility is submitted

12 under this title, including any facility with

13 respect to which a corrective action permit

14 or order has been issued or modified to re15 quire the implementation of corrective

16 measures;

17 (v) any land disposal unit with respect

18 to which a closure notification under sub19 title C of the Solid Waste Disposal Act (42

20 U.S.C. 6921 et seq.) has been submitted

21 and closure requirements have been speci22 fied in a closure plan or permit;

23 (vi) any facility at which there has

24 been a release of polychlorinated biphenyls

25 and that is subject to the requirements of
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1 the Toxic Substances Control Act (15

2 U.S.C. 2601 et seq.);

3 (vii) any facility with respect to which

4 an administrative order on consent or a ju5 dicial consent decree requiring cleanup has

6 been entered into by the President and is

7 still in effect under—

8 (I) the Comprehensive Environ9 mental Response, Compensation, and

10 Liability Act of 1980 (42 U.S.C. 9601

11 et seq.);

12 (II) the Solid Waste Disposal Act

13 (42 U.S.C. 6901 et seq.);

14 (III) the Federal Water Pollution

15 Control Act (33 U.S.C. 1251 et seq.);

16 (IV) the Toxic Substances Con17 trol Act (15 U.S.C. 2601 et seq.); or

18 (V) title XIV of the Public

19 Health Service Act (commonly known

20 as the ‘‘Safe Drinking Water Act’’)

21 (42 U.S.C. 300f et seq.);

22 (viii) any facility at which assistance

23 for response activities may be obtained

24 pursuant to subtitle I of the Solid Waste

25 Disposal Act (42 U.S.C. 6991 et seq.)
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1 from the Leaking Underground Storage

2 Tank Trust Fund established by section

3 9508 of the Internal Revenue Code of

4 1986; and

5 (ix) a facility owned or operated by a

6 department, agency or instrumentality of

7 the United States, except for lands held in

8 trust by the United States for Indian

9 tribes.

10 (4) CONTAMINANT.—The term ‘‘contaminant’’

11 includes any hazardous substance (as defined in sec12 tion 101(14) of the Comprehensive Environmental

13 Response, Compensation, and Liability Act of 1980

14 (42 U.S.C. 9601(14)).

15 (5) CURRENT OWNER.—The term ‘‘current

16 owner’’ means, with respect to a voluntary cleanup,

17 an owner of an affected site or facility at the time

18 of the cleanup.

19 (6) DISPOSAL.—The term ‘‘disposal’’ has the

20 meaning provided the term in section 1004(3) of the

21 Solid Waste Disposal Act (42 U.S.C. 6903(3)).

22 (7) ENVIRONMENT.—The term ‘‘environment’’

23 has the meaning provided the term in section 101(8)

24 of the Comprehensive Environmental Response,
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1 Compensation, and Liability Act of 1980 (42 U.S.C.

2 9601(8)).

3 (8) ENVIRONMENTAL CONTAMINATION.—The

4 term ‘‘environmental contamination’’ means the ex5 istence at a facility of 1 or more contaminants that

6 may pose a threat to human health or the environ7 ment.

8 (9) FACILITY.—The term ‘‘facility’’ has the

9 meaning provided the term in section 101(9) of the

10 Comprehensive Environmental Response, Compensa11 tion, and Liability Act of 1980 (42 U.S.C. 9601(9)).

12 (10) GRANT.—The term ‘‘grant’’ includes a co13 operative agreement.

14 (11) GROUND WATER.—The term ‘‘ground

15 water’’ has the meaning provided the term in section

16 101(12) of the Comprehensive Environmental Re17 sponse, Compensation, and Liability Act of 1980 (42

18 U.S.C. 9601(12)).

19 (12) INDIAN TRIBE.—The term ‘‘Indian tribe’’

20 has the meaning provided the term in section

21 101(36) of the Comprehensive Environmental Re22 sponse, Compensation, and Liability Act of 1980 (42

23 U.S.C. 9601(36)).

24 (13) LOCAL GOVERNMENT.—The term ‘‘local

25 government’’ has the meaning provided the term
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1 ‘‘unit of general local government’’ in the first sen2 tence of section 102(a)(1) of the Housing and Com3 munity Development Act of 1974 (42 U.S.C.

4 5302(a)(1)), except that the term includes Indian

5 tribe.

6 (14) NATURAL RESOURCES.—The term ‘‘natu7 ral resources’’ has the meaning provided the term in

8 section 101(16) of the Comprehensive Environ9 mental Response, Compensation, and Liability Act

10 of 1980 (42 U.S.C. 9601(16)).

11 (15) NONADMINISTRATIVE COSTS.—The term

12 ‘‘nonadministrative costs’’ includes the costs of—

13 (A) inventorying and classifying properties

14 with probable contamination;

15 (B) oversight for a cleanup at an affected

16 site by a contractor, current owner, or prospec17 tive purchaser;

18 (C) identifying the probable extent and na19 ture of environmental contamination at the af20 fected site, and the preferred manner of carry21 ing out a cleanup at the affected site;

22 (D) the cleanup, including onsite and off23 site treatment of contaminants; and

24 (E) monitoring ground water or other nat25 ural resources at the affected site.
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1 (16) OWNER.—The term ‘‘owner’’ has the

2 meaning provided the term in section 101(20) of the

3 Comprehensive Environmental Response, Compensa4 tion, and Liability Act of 1980 (42 U.S.C.

5 9601(20)).

6 (17) PERSON.—The term ‘‘person’’ has the

7 meaning provided the term in section 101(21) of the

8 Comprehensive Environmental Response, Compensa9 tion, and Liability Act of 1980 (42 U.S.C.

10 9601(21)).

11 (18) PROSPECTIVE PURCHASER.—The term

12 ‘‘prospective purchaser’’ means a prospective pur13 chaser of an affected site.

14 (19) RELEASE.—The term ‘‘release’’ has the

15 meaning provided the term in section 101(22) of the

16 Comprehensive Environmental Response, Compensa17 tion, and Liability Act of 1980 (42 U.S.C.

18 9601(22)).

19 (20) RESPONSE ACTION.—The term ‘‘response

20 action’’ has the meaning provided the term ‘‘re21 sponse’’ in section 102(25) of such Act (42 U.S.C.

22 9601(25)).

23 (21) SITE CHARACTERIZATION.—

24 (A) IN GENERAL.—The term ‘‘site charac25 terization’’ means an investigation that deter-
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1 mines the nature and extent of a release or po2 tential release of a hazardous substance at a

3 site and meets the requirements referred to in

4 subparagraph (B).

5 (B) INVESTIGATION.—For the purposes of

6 this paragraph, an investigation that meets the

7 requirements of this subparagraph—

8 (i) shall include—

9 (I) an onsite evaluation; and

10 (II) sufficient testing, sampling,

11 and other field data gathering activi12 ties to accurately determine whether

13 the site is contaminated and the

14 threats to human health and the envi15 ronment posed by the release of con16 taminants at the site; and

17 (ii) may also include—

18 (I) review of existing information

19 regarding the site and previous uses

20 (available at the time of the review);

21 and

22 (II) an onsite evaluation, if ap23 propriate.

24 (22) STATE.—The term ‘‘State’’ has the mean25 ing provided the term under section 101(27) of the
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1 Comprehensive Environmental Response, Compensa2 tion, and Liability Act of 1980 (42 U.S.C.

3 9601(27)).

4 TITLE I—BROWNFIELD REMEDI5 ATION AND ENVIRONMENTAL

6 CLEANUP

7 SEC. 101. SITE CHARACTERIZATION GRANT PROGRAM.

8 (a) IN GENERAL.—The Administrator shall establish

9 a program to provide grants to local governments to inven10 tory brownfield sites and to conduct site characterizations

11 of affected sites at which cleanups are being conducted

12 or are proposed to be conducted under a State voluntary

13 cleanup program, State superfund program, or other State

14 cleanup program.

15 (b) SCOPE OF PROGRAM.—

16 (1) GRANT AWARDS.—In carrying out the pro17 gram established under subsection (a), the Adminis18 trator may award a grant to the head of each local

19 government that submits to the Administrator an

20 application (that is approved by the Administrator)

21 to conduct an inventory of sites and a site character22 ization at an affected site or sites within the juris23 diction of the local government.
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1 (2) GRANT APPLICATION.—An application for a

2 grant under this section shall include, at a mini3 mum, each of the following:

4 (A) An identification of the brownfield

5 areas for which assistance is sought and a de6 scription of the effect of the brownfields on the

7 community, including a description of the na8 ture and extent of any known or suspected envi9 ronmental contamination within the areas.

10 (B) The need for Federal support.

11 (C) A demonstration of the potential of the

12 assistance to stimulate economic development,

13 including the extent to which the assistance will

14 stimulate the availability of other funds for site

15 characterization, site identification, or environ16 mental remediation and subsequent redevelop17 ment of the areas in which eligible brownfields

18 sites are situated.

19 (D) The existing local commitment, which

20 shall include a community involvement plan

21 that demonstrates meaningful community in22 volvement.

23 (E) A plan that shows how the site charac24 terization, site identification, or environmental

25 remediation and subsequent development shall
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1 be implemented, including an environmental

2 plan that ensures the use of sound environ3 mental procedures, an explanation of the exist4 ing appropriate government authority and sup5 port for the project, proposed funding mecha6 nisms for any additional work, and the pro7 posed land ownership plan.

8 (F) A statement on the long-term benefits

9 and the sustainability of the proposed project

10 that includes the national replicability and

11 measures of success of the project and, to the

12 extent known, the potential of the plan for the

13 areas in which eligible brownfields sites are sit14 uated to stimulate economic development of the

15 area on completion of the environmental reme16 diation.

17 (G) A statement that describes how the

18 proposed site inventory and characterization

19 program will analyze the extent to which the

20 project or projects will reduce potential health

21 and environmental threats caused by the pres22 ence of or potential releases of contaminants at

23 or from the site or sites.

24 (H) A plan for the distribution of the

25 grant monies among sites within the jurisdic-
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1 tion of the State or local government, including

2 mechanisms to ensure a fair distribution of the

3 grant monies.

4 (I) Such other factors as the Administrator

5 considers relevant to carry out the purposes of

6 this title.

7 (3) APPROVAL OF APPLICATION.—

8 (A) IN GENERAL.—In making a decision

9 whether to approve an application submitted

10 under paragraph (1) the Administrator shall

11 consider the criteria in the application, and—

12 (i) the financial need of the State or

13 local government for funds to conduct a

14 characterization of the site or sites;

15 (ii) the demonstrable potential of the

16 affected site or sites for stimulating eco17 nomic development on completion of the

18 cleanup of the affected site if the cleanup

19 is necessary;

20 (iii) to the extent information is avail21 able, the estimated fair market value of the

22 site or sites (4) after cleanup;

23 (iv) to the extent information is avail24 able, other economically viable, commercial

25 activity on real property—
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1 (I) located within the immediate

2 vicinity of the affected site at the time

3 of consideration of the application; or

4 (II) projected to be located with5 in the immediate vicinity of the af6 fected site by the date that is 5 years

7 after the date of the consideration of

8 the application;

9 (v) the potential of the affected site

10 for creating new business and employment

11 opportunities on completion of the cleanup

12 of the site;

13 (vi) whether the affected site is lo14 cated in an economically distressed com15 munity; and

16 (vii) such other factors as the Admin17 istrator considers relevant to carry out the

18 purposes of the grant program under this

19 section.

20 (B) GRANT CONDITIONS.—As a condition

21 for awarding a grant under this section, the

22 Administrator may, on the basis of the criteria

23 considered under subparagraph (A), attach

24 such conditions to the grant award as the Ad25 ministrator determines appropriate.
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1 (4) GRANT AMOUNT.—The amount of a grant

2 awarded to any local government under subsection

3 (a) for characterization of an affected site or sites

4 shall not exceed $200,000.

5 (5) TERMINATION OF GRANTS.—If the Admin6 istrator determines that a local government that re7 ceives a grant under this subsection is in violation

8 of a condition of a grant award referred to in para9 graph (3), the Administrator may terminate the

10 grant made to the local government and require full

11 or partial repayment of the grant award.

12 SEC. 102. ECONOMIC REDEVELOPMENT ASSISTANCE

13 GRANTS FOR LOAN PROGRAMS.

14 (a) ESTABLISHMENT OF PROGRAM.—The Adminis15 trator shall establish a program to provide grants to be

16 used by State or local governments to capitalize loan pro17 grams for the cleanup of affected sites. These loans may

18 be provided by the State or local government to finance

19 cleanups of affected sites by the State or local government,

20 or by an owner or a prospective purchaser of an affected

21 site (including a local government) at which a cleanup is

22 being conducted or is proposed to be conducted under Fed23 eral or State authority, including a State voluntary clean24 up program.

25 (b) SCOPE OF PROGRAM.—
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1 (1) IN GENERAL.—

2 (A) GRANTS.—The Administrator may

3 award a grant to a local or State government

4 that is an eligible applicant described in sub5 section (a)(1) that submits an application to the

6 Administrator that is approved by the Adminis7 trator. The grant monies shall be used by the

8 local or State government to capitalize a loan

9 fund to be used for cleanup of an affected site

10 or affected sites.

11 (B) GRANT APPLICATION.—An application

12 for a grant under this section shall be in such

13 form as the Administrator determines appro14 priate. At a minimum, the application submit15 ted by the State or local government to estab16 lish a revolving loan program shall include the

17 following:

18 (i) Insofar as the sites within their ju19 risdiction have been identified and infor20 mation as to the contaminated sites is

21 known, a description of the affected site or

22 sites, including the nature and extent of

23 any known or suspected environmental

24 contamination at the affected site or sites.
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1 (ii) Identification of the criteria to be

2 used by the local or State government in

3 providing for loans under the program.

4 This criteria shall include the financial

5 standing of the applicants for the loans,

6 the use to which the loans will be put, and

7 the provisions to be used to ensure repay8 ment of the funds. These criteria shall also

9 include:

10 (I) A complete description of the

11 financial standing of the applicant

12 that includes a description of the as13 sets, cash flow, and liabilities of the

14 applicant.

15 (II) A written certification that

16 attests that the applicant has at17 tempted, and has been unable, to se18 cure financing from a private lending

19 institution for the cleanup action that

20 is the subject of the loan application.

21 (III) The proposed method, and

22 anticipated period of time required, to

23 clean up the environmental contami24 nation at the affected site.
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1 (IV) An estimate of the proposed

2 total cost of the cleanup to be con3 ducted at the site.

4 (V) An analysis that dem5 onstrates the potential of the affected

6 site for simulating economic develop7 ment on completion of the cleanup of

8 the site.

9 (2) GRANT APPROVAL.—In determining wheth10 er to award a grant under this section, the Adminis11 trator shall consider—

12 (A) the need of the local or State govern13 ment for financial assistance to clean up the af14 fected site or sites that are the subject of the

15 application, taking into consideration the finan16 cial resources available to the local or State

17 government;

18 (B) the ability of the local or State govern19 ment to ensure that the applicants repay the

20 loans in a timely manner;

21 (C) the extent to which the cleanup of the

22 affected site or sites would reduce health and

23 environmental risks caused by the release of

24 contaminants at, or from, the affected site or

25 sites;
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1 (D) the demonstrable potential of the af2 fected site or sites for stimulating economic de3 velopment on completion of the cleanup;

4 (E) the demonstrated ability of the local or

5 State government to administer such a loan

6 program;

7 (F) the demonstrated experience of the

8 local or State government regarding brownfields

9 and the reuse of contaminated land, including

10 whether or not the government has received

11 grant monies under the Comprehensive Envi12 ronmental Response, Compensation, and Liabil13 ity Act of 1980 (42 U.S.C. 9601 et seq.) to

14 characterize brownfields sites provided however

15 that applicants who have not previously received

16 such grant monies may also be considered for

17 awards under this section;

18 (G) the efficiency of having the loan ad19 ministered by the applicant entity level of gov20 ernment;

21 (H) the experience of administering any

22 loan programs by the entity, including the loan

23 repayment rates;

24 (I) the demonstrations made regarding the

25 ability of the local or State government to en-
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1 sure a fair distribution of grant monies among

2 sites within their jurisdiction; and

3 (J) such other factors as the Administrator

4 considers relevant to carry out the purposes of

5 the loan program established under this section.

6 (3) GRANT AMOUNT.—The amount of a grant

7 made to a local or State applicant under this section

8 shall not exceed $500,000.

9 (4) STATE APPROVAL.—Each application for a

10 grant under this section shall, as a condition for ap11 proval by the Administrator, include a written state12 ment by the local or State government that cleanups

13 to be funded under their loan programs shall be con14 ducted under the auspices of and compliant with the

15 State voluntary cleanup program or State Superfund

16 program or Federal authority, and that—

17 (A) the cleanup or proposed voluntary

18 cleanup is cost-effective; and

19 (B) the estimated total cost of the cleanup

20 is reasonable.

21 (c) GRANT AGREEMENTS.—Each grant under this

22 section shall be made pursuant to a grant agreement. At

23 a minimum, the grant agreement shall include provisions

24 that ensure the following:
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1 (1) The grant recipient shall include in all loan

2 agreements a requirement that the loan recipient

3 shall comply with all applicable Federal and State

4 laws applicable to the cleanup and shall ensure that

5 the cleanup is protective of human health and the

6 environment.

7 (2) The local or State government shall require

8 and ensure repayment of the loan consistent with

9 this title.

10 (3) The State or local government shall use the

11 funds solely for purposes of establishing and capital12 izing a loan program pursuant to the provisions of

13 this title and of cleaning up the environmental con14 tamination at the affected site or sites.

15 (4) The State or local government shall require

16 in each loan agreement, and take necessary steps to

17 ensure, that the loan recipient shall use the loan

18 funds solely for the purposes stated in paragraph

19 (3), and shall require the return of any excess funds

20 immediately on a determination by the appropriate

21 State or local official that the cleanup has been com22 pleted.

23 (5) The funds shall not be transferable, unless

24 the Administrator agrees to the transfer in writing.

25 (6) LIEN.—
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1 (A) IN GENERAL.—A lien in favor of the

2 State shall arise on the contaminated property

3 subject to a loan under this section. The lien

4 shall cover all real property included in the

5 legal description of the property at the time the

6 loan agreement provided for in this section is

7 signed, and all rights to the property, and shall

8 continue until the terms and conditions of the

9 loan agreement have been fully satisfied. The

10 lien shall arise at the time a security interest is

11 appropriately recorded in the real property

12 records of the appropriate office of the State,

13 county, or other governmental subdivision, as

14 designated by State law, in which the real prop15 erty subject to the lien is located, and shall be

16 subject to the rights of any purchaser, holder of

17 a security interest, or judgment lien creditor

18 whose interest is or has been perfected under

19 applicable State law before the notice has been

20 filed in the appropriate office within the State,

21 county, or other governmental subdivision, as

22 designated by State law, in which the real prop23 erty subject to the lien is located.

24 (B) DEFINITIONS.—In this paragraph, the

25 terms ‘‘security interest’’ and ‘‘purchaser’’ have
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1 the meanings provided in section 6323(h) of the

2 Internal Revenue Code of 1986.

3 (7) Such other terms and conditions that the

4 Administrator determines to be necessary to protect

5 the financial interests of the United States or to

6 protect human health and the environment.

7 (e) AUDITS.—The Inspector General of the Environ8 mental Protection Agency shall audit a portion of the

9 grants awarded under this section to ensure that all funds

10 are used for the purposes set forth in this section. The

11 result of the audit shall be taken into account in awarding

12 any future grant monies to the entity of State or local

13 government.

14 SEC. 103. REGULATIONS.

15 The Administrator may promulgate such regulations

16 as are necessary to carry out this Act. The regulations

17 shall include the procedures and standards that the Ad18 ministrator considers necessary, including procedures and

19 standards for evaluating an application for a grant or loan

20 submitted under this Act.

21 SEC. 104. ECONOMIC REDEVELOPMENT GRANTS.

22 (a) EXPENDITURES FROM THE SUPERFUND.—

23 Amounts in the Superfund shall be made available, con24 sistent with and for the purposes of carrying out the grant

25 program established under sections 101 and 102.
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1 (b) AUTHORITY TO AWARD GRANTS.—There are au2 thorized to be appropriated from the Superfund, as grants

3 to local and State governments as provided for in sections

4 101 and 102, an amount equal to $25,000,000 for each

5 of fiscal years 1997, 1998, 1999, 2000, and 2001.

6 SEC. 105. AUTHORIZATIONS OF APPROPRIATIONS.

7 (a) SITE CHARACTERIZATION PROGRAM.—There are

8 authorized to be appropriated to the Environmental Pro9 tection Agency to carry out section 101, an amount not

10 to exceed $10,000,000 for each of fiscal years 1997

11 through 2001.

12 (b) ECONOMIC REDEVELOPMENT ASSISTANCE PRO13 GRAM.—There are authorized to be appropriated to the

14 Environmental Protection Agency to carry out section 102

15 an amount not to exceed $15,000,000 for each of fiscal

16 years 1997 through 2001.

17 (c) AVAILABILITY OF FUNDS.—The amounts appro18 priated pursuant to this section shall remain available

19 until expended.

20 SEC. 106. REPORTS.

21 (a) IN GENERAL.—Not later than 1 year after the

22 date of enactment of this Act, and not later than January

23 31 of each of the 3 calendar years thereafter, the Adminis24 trator shall prepare and submit a report describing the
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1 achievements of each program established under this title

2 to—

3 (1) the Committee on Environment and Public

4 Works of the Senate; and

5 (2) the Committee on Energy and Commerce of

6 the House of Representatives.

7 (b) CONTENTS OF REPORT.—Each report shall, with

8 respect to each of the programs established under this

9 title, include a description of—

10 (1) the number of applications received by the

11 Administrator during the preceding calendar year;

12 (2) the number of applications approved by the

13 Administrator during the preceding calendar year;

14 and

15 (3) the allocation of assistance under sections

16 101 and 102 among the States and local govern17 ments for assistance under this title.

18 SEC. 107. FUNDING.

19 (a) ADMINISTRATIVE COST LIMITATION.—Not more

20 than 15 percent of the amount of a grant made pursuant

21 to this title may be used for administrative costs. No grant

22 made pursuant to this title may be used to pay for fines

23 or penalties owed to a State or the Federal Government,

24 or for Federal cost-sharing requirements.
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1 (b) OTHER LIMITATIONS.—Funds made available to

2 a State or local government pursuant to the grant pro3 grams established under sections 101 and 102 shall be

4 used only for inventorying, assessing, and characterizing

5 sites as authorized by this Act, and for capitalizing a loan

6 program as authorized by this Act. Funds made available

7 under this title may not be used to relieve a local govern8 ment or State of the commitment or responsibilities of the

9 local government or State under State law to assist or

10 carry out cleanup actions at affected sites.

11 SEC. 108. STATUTORY CONSTRUCTION.

12 Nothing in this title is intended to affect the liability

13 or response authorities for environmental contamination

14 of any other law (including any regulation), including—

15 (1) the Comprehensive Environmental Re16 sponse, Compensation, and Liability Act of 1980 (42

17 U.S.C. 9601 et seq.);

18 (2) the Solid Waste Disposal Act (42 U.S.C.

19 9601 et seq.);

20 (3) the Federal Water Pollution Control Act

21 (33 U.S.C. 1251 et seq.);

22 (4) the Toxic Substances Control Act (15

23 U.S.C. 2601 et seq.); and
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1 (5) title XIV of the Public Health Service Act

2 (commonly known as the ‘‘Safe Drinking Water

3 Act’’) (42 U.S.C. 300f et seq.).

4 TITLE II—PROSPECTIVE

5 PURCHASERS

6 SEC. 201. LIMITATIONS ON LIABILITY FOR RESPONSE

7 COSTS FOR PROSPECTIVE PURCHASERS.

8 (a) LIMITATIONS ON LIABILITY.—Section 107 of the

9 Comprehensive Environmental Response, Compensation,

10 and Liability Act of 1980 (42 U.S.C. 9607) is amended

11 by adding at the end the following new subsection:

12 ‘‘(n) LIMITATIONS ON LIABILITY FOR PROSPECTIVE

13 PURCHASERS.—Notwithstanding paragraphs (1) through

14 (4) of subsection (a), a person who does not impede the

15 performance of response actions or natural resource res16 toration at a facility shall not be liable under this Act,

17 to the extent liability is based solely on subsection (a)(1)

18 for a release or threat of release from a facility, and the

19 person is a bona fide prospective purchaser of the facil20 ity.’’.

21 (b) PROSPECTIVE PURCHASER AND WINDFALL

22 LIEN.—Section 107 of the Comprehensive Environmental

23 Response, Compensation, and Liability Act of 1980 (as

24 amended by subsection (a)) is further amended by insert25 ing after subsection (n) the following new subsection:
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1 ‘‘(o) PROSPECTIVE PURCHASER AND WINDFALL

2 LIEN.—

3 ‘‘(1) LIEN.—In any case in which there are un4 recovered response costs at a facility for which an

5 owner of the facility is not liable by reason of sub6 section (n), and the conditions described in para7 graph (2) are met, the United States shall have a

8 lien upon such facility, or may obtain from the ap9 propriate responsible party or parties, a lien on

10 other property or other assurances of payment satis11 factory to the Administrator, for such unrecovered

12 costs. Such lien—

13 ‘‘(A) shall not exceed the increase in fair

14 market value of the property attributable to the

15 response action at the time of a subsequent sale

16 or other disposition of the property;

17 ‘‘(B) shall arise at the time costs are first

18 incurred by the United States with respect to a

19 response action at the facility;

20 ‘‘(C) shall be subject to the requirements

21 for notice and validity established in paragraph

22 (3) of subsection (l); and

23 ‘‘(D) shall continue until the earlier of sat24 isfaction of the lien or recovery of all response

25 costs incurred at the facility.
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1 ‘‘(2) CONDITIONS.—The conditions referred to

2 in paragraph (1) are the following:

3 ‘‘(A) RESPONSE ACTION.—A response ac4 tion for which there are unrecovered costs is

5 carried out at the facility.

6 ‘‘(B) FAIR MARKET VALUE.—Such re7 sponse action increases the fair market value of

8 the facility above the fair market value of the

9 facility that existed 180 days before the re10 sponse action was taken.’’.

11 (c) Section 101 of the Comprehensive Environmental

12 Response, Compensation, and Liability Act of 1980 (42

13 U.S.C. 9601) is amended by adding at the end the follow14 ing new paragraph:

15 ‘‘(39) BONA FIDE PROSPECTIVE PURCHASER.—

16 The term ‘bona fide prospective purchaser’ means a

17 person who acquires ownership of a facility after the

18 date of enactment of the Brownfields and Environ19 mental Cleanup Act of 1996, or a tenant of such a

20 person, who can establish each of the following by a

21 preponderance of the evidence:

22 ‘‘(A) DISPOSAL PRIOR TO ACQUISITION.—

23 All active disposal of hazardous substances at

24 the facility occurred before that person acquired

25 the facility.
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1 ‘‘(B) INQUIRY.—The person made all ap2 propriate inquiry into the previous ownership

3 and uses of the facility and its real property in

4 accordance with generally accepted good com5 mercial and customary standards and practices.

6 The standards and practices issued by the Ad7 ministrator pursuant to paragraph (35)(B)(ii)

8 shall satisfy the requirements of this subpara9 graph. In the case of property for residential or

10 other similar use purchased by a nongovern11 mental or noncommercial entity, a site inspec12 tion and title search that reveal no basis for

13 further investigation satisfy the requirements of

14 this subparagraph.

15 ‘‘(C) NOTICES.—The person provided all

16 legally required notices with respect to the dis17 covery or release of any hazardous substances

18 at the facility.

19 ‘‘(D) CARE.—The person exercised appro20 priate care with respect to hazardous sub21 stances found at the facility by taking reason22 able steps to stop on-going releases, prevent

23 threatened future releases of hazardous sub24 stances, and prevent or limit human or natural
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1 resource exposure to hazardous substances pre2 viously released into the environment.

3 ‘‘(E) COOPERATION, ASSISTANCE, AND AC4 CESS.—The person provides full cooperation,

5 assistance, and facility access to those persons

6 that are responsible for response actions at the

7 facility, including the cooperation and access

8 necessary for the installation, integrity, oper9 ation, and maintenance of any complete or par10 tial response action at the facility.

11 ‘‘(F) RELATIONSHIP.—The person is not

12 liable, or is not affiliated with any other person

13 that is potentially liable, for response costs at

14 the facility, through any direct or indirect fa15 milial relationship, or any contractual, cor16 porate, or financial relationship other than that

17 created by the instruments by which title to the

18 facility is conveyed or financed.’’.

19 TITLE III—FIDUCIARY AND

20 LENDER LIABILITY

21 SEC. 301. FIDUCIARY LIABILITY.

22 (a) DEFINITIONS.—Section 101 of the Comprehen23 sive Environmental Response, Compensation, and Liabil24 ity Act of 1980 (42 U.S.C. 9601) (as amended by section

25 201(c)) is amended by adding at the end the following:
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1 ‘‘(40) FIDUCIARY.—The term ‘fiduciary’—

2 ‘‘(A) means a person acting for the benefit

3 of another party as a bona fide—

4 ‘‘(i) trustee;

5 ‘‘(ii) executor;

6 ‘‘(iii) administrator of an estate;

7 ‘‘(iv) custodian;

8 ‘‘(v) guardian of estates or guardian

9 ad litem;

10 ‘‘(vi) court-appointed receiver;

11 ‘‘(vii) conservator;

12 ‘‘(viii) committee of estates of inca13 pacitated persons or other incapacitated

14 persons;

15 ‘‘(ix) personal representative; or

16 ‘‘(x) representative in any other ca17 pacity that the Administrator, pursuant to

18 public notice, determines to be similar to

19 those listed in clauses (i) through (ix); and

20 ‘‘(B) does not include any person who—

21 ‘‘(i) had a role in establishing a trust,

22 estate, or fiduciary relationship if such

23 trust, estate, or fiduciary relationship has

24 no objectively reasonable or substantial
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1 purpose apart from the avoidance or limi2 tation of liability under this Act; or

3 ‘‘(ii) is acting as a fiduciary with re4 spect to a trust or other fiduciary estate

5 that—

6 ‘‘(I) was not created as part of,

7 or to facilitate, one or more estate

8 plans or pursuant to the incapacity of

9 a natural person; and

10 ‘‘(II) was organized for the pri11 mary purpose of, or is engaged in, ac12 tively carrying on a trade or business

13 for profit.

14 ‘‘(41) FIDUCIARY CAPACITY.—The term ‘fidu15 ciary capacity’, in reference to an act of a person

16 with respect to a vessel or facility, means a capacity

17 in which the person holds title to a vessel or facility,

18 or otherwise has control of or an interest in a vessel

19 or facility, pursuant to the exercise of the respon20 sibilities of the person as a fiduciary.’’.

21 (b) LIABILITY OF FIDUCIARIES.—Title I of the Com22 prehensive Environmental Response, Compensation, and

23 Liability Act of 1980 (42 U.S.C. 9601 et seq.) is amended

24 by adding at the end the following new section:
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1 ‘‘SEC. 127. LIABILITY OF FIDUCIARIES.

2 ‘‘(a) IN GENERAL.—The liability of a fiduciary that

3 is liable under any other provision of this Act for the re4 lease or threatened release of a hazardous substance at,

5 from, or in connection with a vessel or facility held in a

6 fiduciary capacity, may not exceed the assets held in such

7 fiduciary capacity that are available to indemnify the fidu8 ciary.

9 ‘‘(b) EXCLUSION.—Subsection (a) does not apply to

10 the extent that a person is liable under this Act independ11 ent of such person’s ownership or actions taken in a fidu12 ciary capacity.

13 ‘‘(c) LIMITATION.—Subsections (a) and (d) shall not

14 limit the liability of a fiduciary whose failure to exercise

15 due care caused or contributed to the release of a hazard16 ous substance.

17 ‘‘(d) SAFE HARBOR.—A fiduciary shall not be liable

18 in its personal capacity under this Act for—

19 ‘‘(1) undertaking or directing another to under20 take a response action under section 107(d)(1) or

21 under the direction of an on-scene coordinator;

22 ‘‘(2) undertaking or directing another to under23 take any other lawful means of addressing hazard24 ous substances in connection with the vessel or facil25 ity;

26 ‘‘(3) terminating the fiduciary relationship;
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1 ‘‘(4) including in the terms of a fiduciary agree2 ment covenant, warranty, or other terms or condi3 tions that relate to compliance with environmental

4 laws, or monitoring or enforcing such terms;

5 ‘‘(5) monitoring or undertaking one or more in6 spections of the vessel or facility;

7 ‘‘(6) providing financial or other advice or coun8 seling to any other party to the fiduciary relation9 ship, including the settler or beneficiary;

10 ‘‘(7) restructuring, renegotiating, or otherwise

11 altering a term or condition of the fiduciary relation12 ship;

13 ‘‘(8) acting in a fiduciary capacity with respect

14 to a vessel or facility that was contaminated before

15 the fiduciary’s period of service; or

16 ‘‘(9) declining to take any of the actions de17 scribed in paragraphs (2) through (8).

18 ‘‘(e) SAVINGS CLAUSE.—Nothing in this section shall

19 affect the rights or immunities or other defenses that are

20 available under this Act or other applicable law to any per21 son subject to the provisions of this section. Nothing in

22 this section shall create any liability for any party. Noth23 ing in this section shall create a private right of action

24 against a fiduciary or any other party.
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1 ‘‘(f) NO EFFECT ON CERTAIN PERSONS.—Nothing

2 in this section shall be construed to affect the liability,

3 if any, of a person who—

4 ‘‘(1)(A) acts in a capacity other than a fidu5 ciary capacity; and

6 ‘‘(B) directly or indirectly benefits from a trust

7 or fiduciary relationship; or

8 ‘‘(2) who—

9 ‘‘(A) is a beneficiary and a fiduciary with

10 respect to the same fiduciary estate; and

11 ‘‘(B) as a fiduciary, receives benefits that

12 exceed customary or reasonable compensation,

13 and incidental benefits, permitted under other

14 applicable law.

15 ‘‘(g) REGULATORY AUTHORITY.—

16 ‘‘(1) IN GENERAL.—The Administrator may—

17 ‘‘(A) issue such regulations as the Admin18 istrator deems necessary to carry out this sec19 tion; and

20 ‘‘(B) delegate and assign any duties or

21 powers imposed upon or assigned to the Admin22 istrator by this section, including the authority

23 to issue regulations.

24 ‘‘(2) AUTHORITY TO CLARIFY.—The authority

25 under paragraph (1) includes authority to clarify or
41

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1 interpret all terms, including those used in this sec2 tion, and to implement any provision of this sec3 tion.’’.

4 (c) EFFECTIVE DATE.—The amendments made by

5 this section shall apply to any claim that has not been

6 fully adjudicated as of the date of enactment of this Act.

7 SEC. 302. LIABILITY OF LENDERS.

8 (a) DEFINITION OF PARTICIPATION IN MANAGE9 MENT.—Section 101(20) of the Comprehensive Environ10 mental Response, Liability, and Compensation Act of

11 1980 (42 U.S.C. 9601(20)) is amended—

12 (1) in subparagraph (A), by striking the second

13 sentence;

14 (2) by amending paragraph (A)(iii) to read as

15 follows:

16 ‘‘(iii) any person who owned, operated

17 or otherwise controlled activities at a vessel

18 or facility immediately before the United

19 States (including any department, agency

20 or instrumentality), a unit of State or local

21 government, or their agents or appointees,

22 acquired title or control of such vessel or

23 facility in any of the following ways:

24 ‘‘(I) through bankruptcy, tax de25 linquency, abandonment, or escheat;
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1 ‘‘(II) through forclosure that is

2 connected with the provision of loans,

3 discounts, advances, guarantees, in4 surance, or other financial assistance,

5 if the United States or unit of State

6 or local government meets the require7 ments of paragraph (F)(ii) (I) and

8 (II) of this section;

9 ‘‘(III) through the exercise of

10 statutory receivership or

11 conservatorship authority, including

12 any liquidating or winding up the af13 fairs of any person or any subsidiary

14 thereof, if the governmental entity did

15 not participate in management of the

16 vessel or facility prior to acquiring

17 title or control and meets the require18 ments of paragraph (F)(ii)(II) of this

19 section;

20 ‘‘(IV) through the exercise of any

21 seizure or forfeiture authority;

22 ‘‘(V) in any civil, criminal, or ad23 ministrative enforcement proceeding,

24 whether by order or settlement, in

25 which an interest in a vessel or facility
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1 is conveyed to satisfy a claim of the

2 governmental entity, and the govern3 mental entity meets the requirements

4 of this section; and

5 ‘‘(VI) temporarily in connection

6 with a law enforcement operation.’’;

7 (3) by amending paragraph (D) to read as fol8 lows:

9 ‘‘(D)(i) The term ‘owner or operator’ does

10 not include the United States (including any de11 partment, agency, or instrumentality) or a unit

12 of State or local government that acquires title

13 or control of a vessel or facility in a manner de14 scribed in paragraph (A)(iii), or in any other

15 circumstances in which the government involun16 tary acquires title by virtue of its function as

17 sovereign.

18 ‘‘(ii) Notwithstanding subparagraph (i), if

19 the United States or a unit of State or a unit

20 of State or local government caused or contrib21 uted to the release or threatened release of a

22 hazardous substance from the facility, this Act

23 (including section 107) shall apply in the same

24 manner and to the same extent, procedurally
44

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1 and substantively, as the Act does to any non2 governmental entity.’’; and

3 (4) by adding at the end the following:

4 ‘‘(E) EXCLUSION OF PERSONS NOT PAR5 TICIPANTS IN MANAGEMENT.—

6 ‘‘(i) INDICIA OF OWNERSHIP TO PRO7 TECT SECURITY INTEREST.—The term

8 ‘owner or operator’ does not include—

9 ‘‘(I) a person, including a succes10 sor or assign of such person, who,

11 without participating in the manage12 ment of a vessel or facility, holds indi13 cia of ownership primarily to protect

14 such person’s security interest in the

15 vessel or facility; or

16 ‘‘(II) a successor or assign of a

17 person described in subclause (I).

18 ‘‘(ii) NONPARTICIPATION IN MANAGE19 MENT PRIOR TO FORECLOSURE.—The term

20 ‘owner or operator’ does not include a per21 son that forecloses on a vessel or a facility

22 even if such person forecloses on such ves23 sel or facility, sells, re-leases (in the case

24 of a lease finance transaction), or

25 liquidates the vessel or facility, maintains
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1 business activities, winds up operations, or

2 undertakes any response action under sec3 tion 107(d)(1) or under the direction of an

4 on-scene coordinator, with respect to the

5 vessel or facility, or takes other measures

6 to preserve, protect, or prepare the vessel

7 or facility prior to sale or disposition, if—

8 ‘‘(I) the person did not partici9 pate in management prior to fore10 closure; and

11 ‘‘(II) such person seeks to sell,

12 re-lease (in the case of a lease finance

13 transaction), or otherwise divest such

14 vessel or facility at the earliest prac15 tical, commercially reasonable time,

16 on commercially reasonable terms,

17 taking into account market conditions

18 and legal and regulatory require19 ments.

20 ‘‘(F) PARTICIPATION IN MANAGEMENT.—

21 For purposes of subparagraph (E)—

22 ‘‘(i) the term ‘participate in manage23 ment’ means actually participating in the

24 management or operational affairs of the

25 vessel or facility, and does not include
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1 merely having the capacity to influence, or

2 the unexercised right to control, vessel or

3 facility operations;

4 ‘‘(ii) a person shall be considered to

5 ‘participate in management’ only if, while

6 the borrower is still in possession of the

7 vessel or facility encumbered by the secu8 rity interest, such person—

9 ‘‘(I) exercises decisionmaking

10 control over the environmental compli11 ance of a borrower, such that the per12 son has undertaken responsibility for

13 the hazardous substance handling or

14 disposal practices of the borrower; or

15 ‘‘(II) exercises control at a level

16 comparable to that of a manager of

17 the enterprise of the borrower, such

18 that the person has assumed or mani19 fested responsibility for the overall

20 management of the enterprise encom21 passing day-to-day decisionmaking

22 with respect to environmental compli23 ance, or with respect to all or sub24 stantially all of the operational as25 pects (as distinguished from financial
47

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1 or administrative aspects) of the en2 terprise, other than environmental

3 compliance;

4 ‘‘(iii) the term ‘participate in manage5 ment’ does not include conducting an act

6 or failing to act prior to the time that a se7 curity interest is created in a vessel or fa8 cility; and

9 ‘‘(iv) the term ‘participate in manage10 ment’ does not include—

11 ‘‘(I) holding such a security in12 terest or, prior to foreclosure, aban13 doning or releasing such a security in14 terest;

15 ‘‘(II) including in the terms of an

16 extension of credit, or in a contract or

17 security agreement relating to such an

18 extension, covenant, warranty, or any

19 other term or condition that relates to

20 environmental compliance;

21 ‘‘(III) monitoring or enforcing

22 the term or condition of the extension

23 of credit or security interest;
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1 ‘‘(IV) monitoring or undertaking

2 1 or more inspections of the vessel or

3 facility;

4 ‘‘(V) requiring the borrower to

5 undertake response action or other

6 lawful means of addressing the release

7 or threatened release of a hazardous

8 substance in connection with the ves9 sel or facility prior to, during, or upon

10 the expiration of the term of the ex11 tension of credit;

12 ‘‘(VI) providing financial or other

13 advice or counseling in an effort to

14 mitigate, prevent, or cure default or

15 diminution in the value of the vessel

16 or facility;

17 ‘‘(VII) restructuring, renegotiat18 ing, or otherwise agreeing to alter a

19 term or condition of the extension of

20 credit or security interest;

21 ‘‘(VIII) exercising other remedies

22 that may be available under applicable

23 law for the breach of any term or con24 dition of the extension of credit or se25 curity agreement; or
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1 ‘‘(IX) conducting a response ac2 tion under section 107(d)(1) or under

3 the direction of an on-scene coordina4 tor,

5 if such actions do not rise to the level of

6 participating in management, as defined in

7 clauses (i) and (ii).

8 ‘‘(G) OTHER TERMS.—As used in subpara9 graph (E), subparagraph (F), and this subpara10 graph, the following definitions shall apply:

11 ‘‘(i) BORROWER.—The term ‘bor12 rower’ means a person whose vessel or fa13 cility is encumbered by a security interest.

14 ‘‘(ii) EXTENSION OF CREDIT.—The

15 term ‘extension of credit’ includes a lease

16 finance transaction—

17 ‘‘(I) in which the lessor does not

18 initially select the leased vessel or fa19 cility and does not during the lease

20 term control the daily operations or

21 maintenance of the vessel or facility;

22 or

23 ‘‘(II) that conforms with regula24 tions issued by the appropriate Fed25 eral banking agency or the appro-
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1 priate State bank supervisor (as those

2 terms are defined in section 3 of the

3 Federal Deposit Insurance Act (12

4 U.S.C. 1813)) or with regulations is5 sued by the National Credit Union

6 Administration Board, as appropriate.

7 ‘‘(iii) FINANCIAL OR ADMINISTRATIVE

8 ASPECT.—The term ‘financial or adminis9 trative aspect’ includes a function such as

10 a function of a credit manager, accounts

11 payable officer, accounts receivable officer,

12 personnel manager, comptroller, or chief fi13 nancial officer, or any similar function.

14 ‘‘(iv) FORECLOSURE; FORECLOSE.—

15 The term ‘foreclosure’ and ‘foreclose’

16 mean, respectively, acquiring, and to ac17 quire from a nonaffiliated party for subse18 quent disposition, a vessel or facility

19 through—

20 ‘‘(I) purchase at sale under a

21 judgment or decree, a power of sale, a

22 nonjudicial foreclosure sale, or from a

23 trustee, deed in lieu of foreclosure, or

24 similar conveyance, or through repos25 session, if such vessel or facility was
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1 security for an extension of credit pre2 viously contracted;

3 ‘‘(II) conveyance pursuant to an

4 extension of credit previously con5 tracted, including the termination of a

6 lease agreement; or

7 ‘‘(III) any other formal or infor8 mal manner by which the person ac9 quires, for subsequent disposition,

10 possession of collateral in order to

11 protect the security interest of the

12 person.

13 ‘‘(v) OPERATIONAL ASPECT.—The

14 term ‘operational aspect’ includes a func15 tion such as a function of a facility or

16 plant manager, operations manager, chief

17 operating officer, or chief executive officer.

18 ‘‘(vi) SECURITY INTEREST.—The term

19 ‘security interest’ includes a right under a

20 mortgage, deed of trust, assignment, judg21 ment lien, pledge, security agreement, fac22 toring agreement, or lease, or any other

23 right accruing to a person to secure the re24 payment of money, the performance of a

25 duty, or some other obligation.’’.
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1 (b) EFFECTIVE DATE.—The amendments made by

2 this section shall be applicable with respect to any claim

3 that has not been finally adjudicated as of the date of en4 actment of this Act.

5 (c) LENDER LIABILITY RULE.—(1) Effective on the

6 date of enactment of this section, the final rule issued by

7 the Administrator of the Environmental Protection Agen8 cy on April 29, 1992 (57 Stat. Fed. Reg. 18344), shall

9 be deemed to have been validly issued pursuant to the au10 thority of the Comprehensive Environmental Response,

11 Compensation, and Liability Act of 1980, and to have

12 been effective according to the final rule’s terms. No addi13 tional administrative or judicial proceedings shall be nec14 essary with respect to such final rule.

15 (2) Notwithstanding section 113(a) of the Com16 prehensive Environmental Response, Compensation and

17 Liability Act of 1980, no court shall have jurisdiction to

18 review the final rule issued by the Administrator of the

19 Environmental Protection Agency on April 29, 1992 (57

20 Fed. Reg. 18344).

21 (3) Nothing in this subsection shall be construed to

22 limit the authority of the President or his delegate to

23 amend the final rule issued by the Administrator of the

24 Environmental Protection Agency on April 29, 1992 (57
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1 Fed. Reg. 18344), in accordance with applicable provi2 sions of law.

3 (d) REGULATORY AUTHORITY.—

4 (1) IN GENERAL.—The Administrator may—

5 (A) issue such regulations as the Adminis6 trator deems necessary to carry out the amend7 ments made by this section; and

8 (B) delegate and assign any duties or pow9 ers imposed upon or assigned to the Adminis10 trator by the amendments made by this section,

11 including the authority to issue regulations.

12 (2) AUTHORITY TO CLARIFY.—The authority

13 under paragraph (1) includes authority to clarify or

14 interpret all terms, including those used in this sec15 tion, and to implement any provision of the amend16 ments made by this section.

17 TITLE IV—INNOCENT

18 LANDOWNERS

19 SEC. 401. INNOCENT LANDOWNERS.

20 (a) ENVIRONMENTAL SITE ASSESSMENT.—Section

21 107 (as amended by section 201(b)) is amended by adding

22 at the end the following new subsection:

23 ‘‘(p) INNOCENT LANDOWNERS.—

24 ‘‘(1) CONDUCT OF ENVIRONMENTAL ASSESS25 MENT.—A person who has acquired real property
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1 shall have made all appropriate inquiry within the

2 meaning of subparagraph (B) of section 101(35) if

3 the person establishes that, within 180 days prior to

4 the time of acquisition, an environmental site assess5 ment of the real property was conducted which

6 meets the requirements of paragraph (2).

7 ‘‘(2) DEFINITION OF ENVIRONMENTAL SITE AS8 SESSMENT.—For purposes of this subsection, the

9 term ‘environmental site assessment’ means an as10 sessment conducted in accordance with the stand11 ards set forth in the American Society for Testing

12 and Materials (ASTM) Standard E1527–94, titled

13 ‘Standard practice for Environmental Site Assess14 ments: Phase I Environmental Site Assessment

15 Process’ or with alternative standards issued by rule

16 by the President or promulgated or developed by

17 others and designated by rule by the President. Be18 fore issuing or designating alternative standards, the

19 President shall first conduct a study of commercial

20 and industrial practices concerning environmental

21 site assessments in the transfer of real property in

22 the United States. Any such standards issued or

23 designated by the President shall also be deemed to

24 constitute commercially reasonable and generally ac25 cepted standards and practices for purposes of this
55

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1 paragraph. In issuing or designating any such stand2 ards, the President shall consider requirements gov3 erning each of the following:

4 ‘‘(A) Interviews of owners, operators, and

5 occupants of the property to determine informa6 tion regarding the potential for contamination.

7 ‘‘(B) Review of historical sources as nec8 essary to determine previous uses and occupan9 cies of the property since the property was first

10 developed. For purposes of this subclause, the

11 term ‘historical sources’ means any of the fol12 lowing, if they are reasonably ascertainable: re13 corded chain of title documents regarding the

14 real property, including all deeds, easements,

15 leases, restrictions, and covenants, aerial photo16 graphs, fire insurance maps, property tax files,

17 USGS 7.5 minutes topographic maps, local

18 street directories, building department records,

19 zoning/land use records, and any other sources

20 that identify past uses and occupancies of the

21 property.

22 ‘‘(C) Determination of the existence of re23 corded environmental cleanup liens against the

24 real property which have arisen pursuant to

25 Federal. State, or local statutes.
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1 ‘‘(D) Review of reasonably ascertainable

2 Federal, State, and local government records of

3 sites or facilities that are likely to cause or con4 tribute to contamination at the real property,

5 including, as appropriate, investigation reports

6 for such sites or facilities, records of activities

7 likely to cause or contribute to contamination at

8 the real property, including landfill and other

9 disposal location records, underground storage

10 tank records, hazardous waste handler and gen11 erator records and spill reporting records; and

12 such other reasonably ascertainable Federal,

13 State, and local government environmental

14 records which could reflect incidents or activi15 ties which are likely to cause or contribute to

16 contamination at the real property.

17 ‘‘(E) A visual site inspection of the real

18 property and all facilities and improvements on

19 the real property and a visual inspection of im20 mediately adjacent properties, including an in21 vestigation of any hazardous substance use,

22 storage, treatment, and disposal practices on

23 the property.

24 ‘‘(F) Any specialized knowledge or experi25 ence on the part of the defendant.
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1 ‘‘(G) The relationship of the purchase

2 price to the value of the property if

3 uncontaminated.

4 ‘‘(H) Commonly known or reasonably as5 certainable information about the property.

6 ‘‘(I) The obviousness of the presence or

7 likely presence of contamination at the prop8 erty, and the ability to detect such contamina9 tion by appropriate investigation.

10 A record shall be considered to be ‘reasonably ascer11 tainable’ for purposes of this paragraph if a copy or

12 reasonable facsimile of the record is publicly avail13 able by request (within reasonable time and cost

14 constraints) and the record is practically reviewable.

15 ‘‘(3) APPROPRIATE INQUIRY.—A person shall

16 not be treated as having made all appropriate in17 quiry under paragraph (1) unless—

18 ‘‘(A) the person has maintained a compila19 tion of the information reviewed and gathered

20 in the course of the environmental site assess21 ment;

22 ‘‘(B) the person exercised appropriate care

23 with respect to hazardous substances found at

24 the facility by taking reasonable steps to stop

25 on-going releases, prevent threatened future re-
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1 leases of hazardous substances, and prevent or

2 limit human or natural resource exposure to

3 hazardous substances previously released into

4 the environment; and

5 ‘‘(C) the person provides full cooperation,

6 assistance, and facility access to persons au7 thorized to conduct response actions at the fa8 cility, including the cooperation and access nec9 essary for the installation, integrity, operation,

10 and maintenance of any complete or partial re11 sponse action at the facility.

12 ‘‘(4) DEFINITION OF CONTAMINATION.—For

13 the purposes of this subsection and section 101(35),

14 the term ‘contamination’ means an existing release,

15 a past release, or the threat of a release of a hazard16 ous substance.’’.

17 (b) Section 101(35) of the Comprehensive Environ18 mental Response, Compensation, and Liability Act of

19 1980 (42 U.S.C. 9601(35)) is by striking subparagraph

20 (B) and inserting the following new subparagraph:

21 ‘‘(B) KNOWLEDGE OF INQUIRY REQUIRE22 MENT.—

23 ‘‘(i) IN GENERAL.—To establish that

24 the defendant had no reason to know, as

25 provided in subparagraph (A)(i), the de-
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1 fendant must have undertaken, at the time

2 of the acquisition, all appropriate inquiry

3 (in accordance with section 107(p)) into

4 the previous ownership and uses of the fa5 cility and its real property in accordance

6 with generally accepted good commercial

7 and customary standards and practices.

8 For the purposes of the preceding sentence

9 and until the Administrator issues or des10 ignates standards and practices as pro11 vided in clause (ii), the court shall take

12 into account any specialized knowledge or

13 experience on the part of the defendant,

14 the relationship of the purchase price to

15 the value of the property if

16 uncontaminated, commonly known or rea17 sonably ascertainable information about

18 the property, the obviousness of the pres19 ence or likely presence of contamination at

20 the property, and the ability to detect such

21 contamination by appropriate investigation.

22 ‘‘(ii) RULE.—Within 1 year after the

23 date of enactment of this Act, the Admin24 istrator shall, by rule, issue standards and

25 practices or designate standards and prac-
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1 tices promulgated or developed by others,

2 that satisfy the requirements of this sub3 paragraph. In issuing or designating such

4 standards and practices, the Administrator

5 shall consider each of the following:

6 ‘‘(I) Conduct of an inquiry by an

7 environmental professional.

8 ‘‘(II) Inclusion of interviews with

9 past and present owners, operators,

10 and occupants of the facility and its

11 real property for the purpose of gath12 ering information regarding the poten13 tial for contamination at the facility

14 and its real property.

15 ‘‘(III) Inclusion of a review of

16 historical sources, such as chain of

17 title documents, aerial photographs,

18 building department records, and land

19 use records, to determine previous

20 uses and occupancies of the real prop21 erty since it was first developed.

22 ‘‘(IV) Inclusion of a search for

23 recorded environmental cleanup liens,

24 filed under Federal, State, or local
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1 law, against the facility or its real

2 property.

3 ‘‘(V) Inclusion of a review of

4 Federal, State, and local government

5 records (such as waste disposal

6 records), underground storage tank

7 records, and hazardous waste han8 dling, generation, treatment, disposal,

9 and spill records, concerning contami10 nation at or near the facility or its

11 real property.

12 ‘‘(VI) Inclusion of a visual in13 spection of the facility and its real

14 property and of adjoining properties.

15 ‘‘(VII) Any specialized knowledge

16 or experience on the part of the de17 fendant.

18 ‘‘(VIII) The relationship of the

19 purchase price to the value of the

20 property if uncontaminated.

21 ‘‘(IX) Commonly known or rea22 sonably ascertainable information

23 about the property.

24 ‘‘(X) The obviousness of the

25 presence or likely presence of contami-
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1 nation at the property, and the ability

2 to detect such contamination by ap3 propriate investigation.

4 ‘‘(iii) SITE INSPECTION AND TITLE

5 SEARCH.—In the case of property for resi6 dential use or other similar use purchased

7 by a nongovernmental or noncommercial

8 entity, a site inspection and title search

9 that reveal no basis for further investiga10 tion satisfy the requirements of this sub11 paragraph.’’; and

12 (c) REGULATORY AUTHORITY.—

13 (1) IN GENERAL.—The Administrator may—

14 (A) issue such regulations as the Adminis15 trator deems necessary to carry out the amend16 ments made by this section; and

17 (B) delegate and assign any duties or pow18 ers imposed upon or assigned to the Adminis19 trator by the amendments made by this section,

20 including the authority to issue regulations.

21 (2) AUTHORITY TO CLARIFY.—The authority

22 under paragraph (1) includes authority to clarify or

23 interpret all terms, including those used in this sec-
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1 tion, and to implement any provision of the amend2 ments made by this section.

Æ