HR 5927 IH
101st CONGRESS
2d Session
 H. R. 5927
To clarify the liability of lending institutions under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, to clarify
the innocent landowner defense under that Act, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
October 25, 1990
Mr. OWENS of Utah introduced the following bill; which was referred to the
Committee on Energy and Commerce
A BILL
To clarify the liability of lending institutions under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, to clarify
the innocent landowner defense under that Act, and for other purposes.
  Be it enacted by the Senate and House of Representatives of the United
  States of America in Congress assembled,
SECTION 1. SHORT TITLE.
  This Act may be cited as the `Superfund Liability Clarification Act'.
SEC. 2. CLARIFICATION OF LIABILITY OF LENDERS UNDER COMPREHENSIVE ENVIRONMENTAL
RESPONSE, COMPENSATION, AND LIABILITY ACT OF 1980.
  (a) FORECLOSURES AND LOAN WORKOUTS- Paragraph (20) of section 101 of the
  Comprehensive Environmental Response, Compensation, and Liability Act of
  1980 (42 U.S.C. 9601(20)) is amended--
  (1) by designating the last sentence of subparagraph (A) as subparagraph
  (E) and transferring such subparagraph (E) to the end of paragraph (2);
  (2) by striking out `Such term' in such subparagraph (E) and inserting in
  lieu thereof `(i) The term `owner or operator' '; and
  (3) by adding at the end of such subparagraph (E) the following: `The
  exclusion of the preceding sentence shall apply to any mortgage lender,
  insured depository institution, or Federal lending institution who acquires
  the vessel or facility through foreclosure or who conducts a restructuring of
  a loan or other extension of credit with the owner of the vessel or facility,
  if such mortgage lender, insured depository institution, or Federal lending
  institution complies with procedures or guidelines imposed pursuant to
  clause (iii). For purposes of the exclusion in the first sentence of this
  subparagraph, the phrase `participation in the management of a vessel or
  facility' does not include--
  `(I) selling collateral;
  `(II) actions taken by a mortgage lender, insured depository institution,
  or Federal lending institution to comply with procedures or guidelines
  imposed pursuant to clause (iii), including the conduct of a Phase I
  Environmental Audit of the vessel or facility (as such term is used in
  paragraph (35)(C) of this section);
  `(III) actions taken by a mortgage lender, insured depository institution,
  or Federal lending institution to responsibly manage the vessel or
  facility upon learning of any contamination so as not to cause a release
  of a hazardous substance from or at the vessel or facility or to harm the
  public health and safety or the environment, during any period while the
  lender or institution is acting to administer or wind down the affairs of
  the owner of the vessel or facility or while diligently proceeding to pass
  title of the vessel or facility; or
  `(IV) the status of having the capacity to affect hazardous waste disposal
  management decisions of the vessel or facility, without actually making
  or influencing any such decisions.'.
  (b) DEFINITIONS- Subparagraph (E) of section 101(20) of the Comprehensive
  Environmental Response, Compensation, and Liability Act of 1980 (42
  U.S.C. 9601(20)) is further amended by adding after clause (i) the following:
  `(ii) For purposes of this subparagraph:
  `(I) The acquisition of a vessel or facility through foreclosure means
  that the vessel or facility was acquired through conveyance pursuant to the
  terms of an extension of credit previously contracted, or through purchase
  at sales under judgment or decree, power of sale, or from a trustee, if
  such property was security for an extension of credit previously contracted.
  `(II) The term `extension of credit' includes lease transactions that are
  functionally equivalent to a secured loan and that are authorized by and
  comply with regulations issued by the appropriate Federal banking agency
  or State banking authority.
  `(III) The term `insured depository institution' has the meaning given
  such term by section 3 of the Federal Deposit Insurance Act and includes
  an insured credit union and a leasing company that is an affiliate of an
  insured depository institution. The term also includes the Federal Deposit
  Insurance Corporation, the National Credit Union Administrator Board,
  and the Resolution Trust Corporation, in such corporations' or Board's
  capacity as conservator, receivor, or liquidating agency for any insured
  despository institution described in the preceding sentence.
  `(IV) The term `mortgage lender' means a person who is regularly engaged in
  the business of making extensions of credit secured, in whole or in part,
  by real property to nonaffiliated parties.
  `(V) The term `Federal lending institution' includes any agency, department,
  or other unit of the United States Government not otherwise described in
  this clause which makes loans on the security of any vessel or facility,
  including economic and industrial development agencies.
  (c) ENVIRONMENTAL RESPONSIBILITIES- Subparagraph (E) of section 101(20)
  of the Comprehensive Environmental Response, Compensation, and Liability
  Act of 1980 (42 U.S.C. 9601(20)) is further amended by adding after clause
  (ii) the following:
  `(iii) For purposes of this subparagraph, the Administrator, in consultation
  with each appropriate Federal banking agency, the National Credit Union
  Administration Board, and each Federal lending institution, shall take
  necessary actions to assure that depository and lending institutions develop
  and implement adequate procedures to evaluate potential environmental
  risks that may arise from or at vessels or facilities subject to their
  lending and fiduciary activities. The Administrator, in consultation with
  the Secretary of the Department of Housing and Urban Development, shall
  promulgate guidelines to assure that mortgage lenders develop and implement
  equivalent procedures to evaluate potential environmental risks that may
  arise from or at vessels or facilities subject to their lending activities.'.
  (d) LIABILITY NOTWITHSTANDING EXCLUSION-  Subparagraph (E) of section 101(20)
  of the Comprehensive Environmental Response, Compensation, and Liability
  Act of 1980 (42 U.S.C. 9601(20)) is further amended by adding after clause
  (iii) the following:
  `(iv) Nothing in this subparagraph shall affect the liability under this
  Act of a person who, by any act or omission, causes or contributes to a
  release or threatened release of a hazardous substance from or at a vessel
  or facility.'.
  (e) REGULATIONS- The Administrator of the Environmental Protection Agency
  shall promulgate regulations to carry out the amendments made by this
  section.
  (f) EFFECTIVE DATE- The amendments made by this section shall take effect
  on the date of the enactment of this Act.
SEC. 3. CLARIFICATION OF INNOCENT LANDOWNER DEFENSE UNDER COMPREHENSIVE
ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY ACT OF 1980.
  (a) CLARIFICATION- Section 101(35) of the Comprehensive Environmental
  Response, Compensation, and Liability Act of 1980 (42 U.S.C. 9601(35))
  is amended by redesignating subparagraphs (C) and (D) as subparagraphs (D)
  and (E), respectively, and inserting after subparagraph (B), the following:
  `(C)(i) A defendant who has acquired real property establishes a rebuttable
  presumption that he has made all appropriate inquiry within the meaning
  of subparagraph (B) if he establishes that, immediately prior to or at
  the time of acquisition, he obtained or conducted a Phase I Environmental
  Audit of the real property which meets the requirements of this subparagraph.
  `(ii) For purposes of this subparagraph, the term `certified environmental
  professional' means an individual or an entity managed or controlled by such
  individual who is certified by the Environmental Protection Agency under
  regulations promulgated by the Administrator as being qualified to conduct
  one or more aspects of a Phase I Environmental Audit, through academic
  training, occupational experience, training approved by the Environmental
  Protection Agency, or a combination thereof (in the case of an individual)
  or through meeting standards approved by the Environmental Protection Agency
  (in the case of an entity). Such term may include engineers, environmental
  consultants, and attorneys.  For purposes of this subparagraph, the term
  `Phase I Environmental Audit' means an investigation of the real property,
  conducted by a certified environmental professional, to determine or
  discover any indications of the presence or likely presence of a release
  or threatened release of hazardous substances on the real property and
  which consists of a review of each of the following sources of information
  concerning the previous ownership and uses of the real property:
  `(I) Recorded chain of title documents regarding the real property,
  including all deeds, easements, leases, restrictions, and covenants for
  a period of 50 years.
  `(II) Aerial photographs, maps, and other appropriate historical information
  which may reflect prior uses of the real property and which are reasonably
  obtainable through State or local government agencies.
  `(III) Recorded environmental cleanup liens against the real property
  which have arisen pursuant to Federal, State, and local statutes.
  `(IV) Reasonably obtainable Federal, State, and local government records
  of sites or facilities where there has been a release of hazardous
  substances and which are likely to cause or contribute to a release or
  threatened release of hazardous substances on the real property, including
  investigation reports for such sites or facilities; Federal, State, and local
  environmental reports required by law; reasonably obtainable Federal, State,
  and local government environmental records of activities likely to cause or
  contribute to a release or a threatened release of hazardous substances on
  the real property, including landfill and other disposal location records,
  underground storage tank records, hazardous waste handler and generator
  records and spill reporting records; and such other reasonably obtainable
  Federal, State, and local government environmental records which report
  incidents or activities which are likely to cause or contribute to a
  release or threatened release of hazardous substances on the real property.
  `(V) A visual site inspection of the real property and all facilities and
  improvements on the real property, and a visual inspection of immediately
  adjacent properties from the real property, including an investigation
  of any chemical use, storage, treatment and disposal practices on the
  property. Such visual inspection shall include notation of discolored soil,
  stressed or discolored vegetation, any sheen on water, dead or sick animals,
  strange smells, and the presence of any barrel, tank, container, or sump.
  `(VI) A visual site inspection of adjacent property, to the extent permitted
  by the owners or operators of such property.
  `(iii) For purposes of clause (ii), a record shall be considered to be
  reasonably obtainable if the record, a copy of the record, or a reasonable
  facsimile of the record is obtainable from a government agency by request
  within 30 days after submission of a request.
  `(iv) No presumption shall arise under clause (i) unless the defendant has
  maintained a compilation of the information reviewed in the course of the
  Phase I Environmental Audit.
  `(v) Notwithstanding any other provision of this paragraph, if the Phase I
  Environmental Audit reveals the presence or likely presence of a release
  or threatened release of hazardous substances on the real property to be
  acquired, no presumption shall arise under clause (i) with respect to such
  release or threatened release unless the defendant has taken reasonable
  steps, in accordance with current technology available, existing regulations,
  and generally acceptable engineering practices, as may be necessary to
  confirm the absence of such release or threatened release.'.
  (b) REGULATIONS- The Administrator of the Environmental Protection Agency
  shall promulgate regulations to carry out the amendment made by this section.
  (c) EFFECTIVE DATE- The amendment made by this section shall take effect
  on the date of the enactment of this Act.
SEC. 4. EXPEDITED ALLOCATION OF RESPONSIBILITY WITH RESPECT TO INNOCENT
LANDOWNERS.
  Section 122(e) of the Comprehensive Environmental Response, Compensation,
  and Liability Act of 1980 (42 U.S.C. 9622(e)) is amended by adding at the
  end of paragraph (3) the following new subparagraph:
  `(F) The Administrator shall promulgate regulations to expedite the
  determination of the allocation of responsibility of a person claiming
  no liability with respect to a release on the basis of the exception to
  liability provided in section 107(b)(3) (popularly referred to as the
  `innocent landowner defense'). The expedited determination shall be based
  on the information obtained pursuant to subparagraph (B). Notwithstanding
  the nonbinding nature of other allocations of responsibility under this
  paragraph, after technical and legal review of information obtained pursuant
  to subparagraph (B) with respect to a person, and not later than 120 days
  after receipt of such information, the Administrator may grant a conditional
  release from liability to such person. If any new information with respect
  to such person is obtained during the course of settlement proceedings in
  connection with such release, the Administrator shall revoke the conditional
  release of the person and shall determine the allocation of responsibility
  of such person along with the other potentially responsible parties.'.
SEC. 5. STREAMLINED SUPERFUND SITE EVALUATION PROCESS.
  Section 104(b)(1) of the Comprehensive Environmental Response, Compensation,
  and Liability Act of 1980 (42 U.S.C. 9604(b)(1)) is amended by adding at the
  end the following: `Studies, investigations, and other activities carried
  out under this subsection shall be streamlined with respect to sites that
  were used for similar purposes and that contain similar contamination.'.
SEC. 6. SENSE OF CONGRESS ON SUPERFUND CLEANUP.
  It is the sense of Congress that, in carrying out the Comprehensive
  Environmental Response, Compensation, and Liability Act of 1980 (42
  U.S.C. 9601 et seq.), the Administrator of the Environmental Protection
  Agency should--
  (1) focus the conduct of removal and remedial actions on public health,
  safety, and environment considerations, rather than on litigation, through
  means such as the more frequent use of the authority provided under section
  122(g) of such Act to enter into de minimis settlements;
  (2) further delineate priorities within the National Priority List, for
  purposes of ensuring that the sites which present the greatest danger to
  the public health and welfare are cleaned up first; and
  (3) provide Congress with a more accurate estimate of the long-term funding
  necessary to carry out such Act.