The Toxic Mess Called Superfund

The Girl Scouts may find they've helped crumble the whole cookie.

When Detroit's Big Three faced a $40 million tab last year for cleaning up a toxic-waste site in Metamora, Mich., they sent their lawyers after more than 200 other parties that had also used the dump. Among the auto makers' targets: A local Girl Scout troop, which they claim sent garbage from a summer camp to the landfill. "We have no intention of paying," says a Girl Scout spokeswoman.

The incident underscores a grim reality: No one, not even the Girl Scouts, is safely beyond the legal tentacles of the 1980 Superfund law. Enacted after the chemical contamination of Love Canal in upstate New York, the measure was supposed to provide a speedy cleanup for more than 1,000 hazardous waste sites across the U.S. It was to be funded by a tax on the chemical and petroleum industries and by assessments on corporate polluters.

But estimates of the nationwide cost of the cleanup have soared as high as $750 billion--a stunner eclipsing even the government rescue of the savings and loan industry. And no one is willing to pay the tab. The result? Superfund has turned into superscandal. After 12 years and $11 billion spent so far, just 84 of the 1,245 sites on the Superfund high-priority list have been cleaned up. To make matters worse, scientists now are raising doubts about the dangers of the dumps.

LEGAL SWAMP. What's going on? Some classic government waste: Congressional investigators say, for instance, that contractors have used some of the $6 billion they've received in government cleanup money for everything from dancing lessons and Christmas parties to fighting a discrimination charge. But far more of the money has been squandered on legal squabbles over who should pay. A recent RAND Corp. study found that from 1986 to 1989, insurers spent $1.3 billion on Superfund litigation and cleanup--with $1.2 billion of it going to lawyers. "All the money is going to gray flannel suits and virtually none is going to blue denims," says Eugene R. Anderson, a New York lawyer who represents clients that want their insurers to pay for cleanups.

Now there's a growing consensus in the battle-weary business community that if the nation is going to clean up its worst dump sites, Washington will have to find a different way to do it. One possibility--a no-fault program that would require all companies, the polluters and the pure alike, to help finance the detoxification of dump sites. "The whole idea of cleaning up the environment by fighting doesn't make sense to me--and I make an income out of it," says Stephen J. Paris, a Boston lawyer who specializes in environmental cases.

Washington has already taken some tentative steps to revise the Superfund rules. On Apr. 24, the Environmental Protection Agency issued a regulation that insulates from liability banks that simply hold mortgages on Superfund properties. The agency also is expected to propose a cap of perhaps 4% on the liability of municipalities, allowing small towns to escape relatively unscathed. That would solve big problems for Killingworth, Conn. (pop. 4,814), which has a $1.6 million annual budget. The town may face a $1 million tab--and possible bankruptcy--in a pending suit by B. F. Goodrich Co. and several other corporations for a cleanup contribution.

The proposed changes leave Corporate America holding the bag. "It's further poisoning the process," complains Jerry B. Martin, Dow Chemical Co.'s director of environmental affairs. Much of industry would like to throw out liability for past pollution altogether. But any effort to change Superfund so much is likely to face a hail of criticism from environmentalists.

FEAR OF FINES. Indeed, Superfund backers defend putting the financial burden on the biggest polluters, arguing that the fear of big penalties has forced companies to clean up their acts. "Superfund's environmental liability scheme has brought a new environmental ethic to industrial America," says EPA chief William K. Reilly.

That doesn't mean environmentalists don't have plenty of complaints about the current setup. They blast the snail's pace of the cleanup. And they gripe that EPA regional offices impose widely varying cleanup requirements. A lead-contaminated site in Ohio, for instance, was held to a cleanup standard only half as stringent as a similar property in Oregon. "There needs to be a cookbook-like standard to address problems consistently across regions," says Erik D. Olson, an attorney for the Natural Resources Defense Council.

Now, Superfund's woes extend to the very scientific underpinnings of the program. New York State researchers found that the health risks to the residents of Love Canal from chemical wastes were grossly overstated. The EPA's studies even suggest that other environmental problems, such as indoor air pollution, pose a greater health risk than hazardous waste. And a report last year by the National Research Council found that the government lacks data to determine how much of a risk exposure to hazardous waste sites poses. Indeed, the NRC said the cleanup of some sites may "create more of a hazard than would be caused by leaving such materials undisturbed."

When Congress takes up the law's reauthorization next year, it undoubtedly will look at proposals for cleaning up Superfund. American International Group Inc., a giant New York-based insurer, has one: It wants to free companies from liability for past pollution and set up a Superfund trust financed through a 2% surcharge on all commercial insurance premiums. The company estimates the levy could raise $40 billion in the next decade--far more than the $1.4 billion a year the oil-and-chemical-industry tax brings in. Legislation "should focus on getting the cleanup done and not creating lawsuits," says AIG Chairman Maurice R. Greenberg.

PENTAGON WASTE. But few companies will back a plan run by the insurance industry, even if it could help drain the legal swamp. Industry would rather see a tax on waste, which would raise revenues while discouraging pollution. Executives also argue that Uncle Sam shouldn't be let off the hook: The government is among the country's most egregious polluters. One good example: When 40 companies were socked with an $88 million bill to clean up a waste-oil lagoon in New Jersey, some outfits hired investigators who found that the biggest culprit at the site was none other than the Pentagon. The companies in March sued the government, which has not responded yet.

Superfund critics also argue that trying to clean up all the polluted sites is unworkable. "Action needs to be ordered around risk and the technology available to clean up a site," says Michael A. Pierle, Monsanto Co.'s vice-president for health, safety, and environmental affairs. He favors dividing Superfund sites into three categories. Those that can be cleaned up with existing technology would be handled first. High-risk sites that can't be fixed economically would be sealed off. And low-risk sites that can't be fixed with existing equipment would be left alone until new technologies are developed.

Nearly all of the contentious constituencies acknowledge that there's one simple lesson from the mess: More money should be spent on research and less on court battles. And on this much, everybody agrees: Sticking with the current law, a contradictory bundle of good intentions wrapped in legalistic linguine, is no solution to the nation's toxic waste.

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