EPA's PFAS Enforcement Discretion And Settlement Policy Under CERCLA

On April 17, 2024, the U.S. Environmental Protection Agency (EPA) announced a final rule designating perfluorooctanoic acid (PFOA), perfluorooctanesulfonic acid (PFOS)...
United States Environment
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On April 17, 2024, the U.S. Environmental Protection Agency (EPA) announced a final rule designating perfluorooctanoic acid (PFOA), perfluorooctanesulfonic acid (PFOS), and their salts and structural isomers as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). EPA followed up by issuing a memorandum on April 19, 2024, "PFAS Enforcement Discretion and Settlement Policy Under CERCLA" (Policy), setting forth how it intends to enforce the new CERCLA designations.

EPA to Focus on "Major PRPs"

The Policy provides that EPA will enforce its authority "consistent with CERCLA's objectives" by focusing its efforts on parties that have played a "significant role" in releasing or exacerbating the spread of PFAS into the environment. As examples, the Policy lists those who have manufactured PFAS or used PFAS in the manufacturing process, and other industrial parties. For purposes of the Policy, these parties are referred to as major potentially responsible parties (PRPs).

"Equitable Factors" in PFAS Enforcement

To allay concerns that EPA might pursue parties even if it would be inequitable to do so, the Policy expresses EPA's intent not to pursue entities where equitable factors do not support seeking response actions or costs under CERCLA in connection with PFAS. These parties might include:

  • Community water systems and publicly owned treatment works (POTWs);
  • Municipal separate storm sewer systems (MS4s);
  • Publicly owned/operated municipal solid waste landfills;
  • Publicly owned airports and local fire departments; and
  • Farms where biosolids are applied to the land.

EPA does not intend that these entities constitute an exclusive list, as the Policy provides that EPA may extend its enforcement discretion to other parties based on the following "equitable factors," using a totality of circumstances analysis:

  • Whether the entity is a state, local, or Tribal government or works on behalf of or conducts a service that otherwise would be performed by a state, local, or Tribal government.
  • Whether the entity performs a public service role in:
    • Providing safe drinking water;
    • Handling of municipal solid waste;
    • Treating or managing stormwater or wastewater;
    • Disposing of, arranging for the disposal of, or reactivating pollution control residuals (e.g., municipal biosolids and activated carbon filters);
    • Ensuring beneficial application of products from the wastewater treatment process as a fertilizer substitute or soil conditioner; or
    • Performing emergency fire suppression services.
  • Whether the entity manufactured PFAS or used PFAS as part of an industrial process.
  • Whether and to what degree the entity is actively involved in the use, storage, treatment, transportation, or disposal of PFAS.

Other Protections for Non-Major PRPs

Consistent with EPA's statutory settlement and enforcement authority, the Policy seeks to lend additional comfort to non-major PRPs by expressing EPA's intent to protect them by way of settlement agreements under warranted circumstances. The Policy provides two primary methods for this protection:

  1. Contribution Protection from Settling PRPs. EPA will protect certain non-settling PRPs when it enters into settlement agreements with major PRPs by prohibiting settling PRPs from pursuing a contribution claim for litigation and cleanup costs against those non-settling PRPs.
  2. Contribution Protection from Non-Settling PRPs. If EPA enters into a settlement agreement directly with a PRP where equitable factors do not warrant enforcement against it for a PFAS response action, the agreement will provide that the settling PRP will not be liable for third-party contribution claims related to the matters addressed in the settlement agreement. Non-settling PRPs would then be prohibited from pursuing the settling PRP for contribution costs related to the settlement.

The Takeaway

While this is merely a policy, without the force of law, and is by no means perfect, the Policy should provide some degree of comfort that EPA does not intend to pursue its PFAS enforcement authority indiscriminately. Of course, policies can, and do, change over time and by administration, but the regulated community now has pre-enforcement guidance to use in decision-making.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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