Allocating Remedial Costs at Superfund Sites with Commingled Groundwater Contaminant Plumes

Environmental Forensics (2000) 1, 47±54 doi:10.1006/enfo.1999.0006, available online at http://www.idealibrary.com on

Allocating Remedial Costs at Superfund Sites with Commingled Groundwater Contaminant Plumes Robert A. Marryott*{, Gabriel P. Sabadell{}, David P. Ahlfeld}**, Robert H. Harris*{{ and George F. Pinder{{}} *ENVIRON International Corporation, 214 Carnegie Center, Princeton, NJ 08540-6284, U.S.A. {Blasland, Bouck & Lee, Inc., 1536 Cole Boulevard, Suite 335, Golden, CO 80401-3413, U.S.A. }Department of Civil and Environmental Engineering, 139 Marston Hall, University of Massachusetts, Amherst, MA 01003, U.S.A. {{Department of Civil and Environmental Engineering and Department of Mathematics, University of Vermont, Burlington, VT 05405, U.S.A. (Received 21 June 1999, revised manuscript accepted 30 September 1999) Remedial e€orts at Superfund sites across the country focus on groundwater contaminant plumes that have been produced by contributions from multiple parties. Allocating cleanup costs between the parties in a fair and equitable manner can be a problem of substantial complexity. Considerable time and money may be spent determining the amount of contamination attributable to each party in order to apportion liability. Contaminant plumes that have evolved over long periods of time may a€ect large volumes of groundwater and require extensive remediation. Pump and treat remedial costs are driven by both the volume of water extracted and the mass of contaminants removed. Allocation methods based solely on the mass of contaminants contributed by each party are inadequate in this setting since they do not account for both components of the remedial costs. This paper presents an approach for equitably allocating remedial costs when addressing overlapping or commingled groundwater plumes. The method accounts for the major # 2000 AEHS elements driving the costs of remediating dispersed contaminant plumes.

Introduction

plexes, etc.). In these situations, remediation or cleanup of contaminated groundwater is the responsibility of all parties that have contributed to the plume. This paper examines how the parties should share the costs that they incur during the remedial process. In particular, we develop a technically based method for calculating what each party's ``fair share'' should be. The method does not consider nontechnical factors such as ability to pay, standing in the community, and others that often arise in allocation proceedings.

Groundwater contamination is a serious problem throughout the United States. Since the 1970s, every state in the nation has reported cases of contaminated groundwater. In 1994, the National Research Council estimated that more than 300,000 sites across the country had contaminated soil or groundwater requiring some form of remediation; the total estimated cost to clean up the sites at that time approached one trillion dollars (NRC, 1994). Recently, the U.S. Environmental Protection Agency (EPA) has begun the daunting task of quantitatively assessing the overall quality of the nation's groundwater resources to evaluate the extent to which they have been impacted. Groundwater quality can be adversely impacted in a variety of ways. The most signi®cant impacts, however, occur as the result of human activities, speci®cally, past and present commercial, agricultural, and industrial practices. Increased industrial activity in the latter half of the 20th century has resulted in groundwater contamination from solvents and other toxic chemicals. In many industrial or commercial locations, plumes of contaminated groundwater are made up of overlapping or commingled plumes that have been caused by multiple parties (e.g. leaking underground storage tanks from adjacent service stations or dry cleaning facilities, releases from neighboring industrial com-

Allocation and the Regulatory Framework In 1980, Congress enacted the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or Superfund) which provides several mechanisms for cleaning up and paying for actual or threatened releases of hazardous substances to the environment. Under CERCLA Section 107, the U.S. Government, usually acting through EPA, may recover cleanup costs from a broadly de®ned class of parties deemed ``responsible'' for a release. These parties, called potentially responsible parties or PRPs, include past and present owners, operators, transporters, and others who ``arranged for disposal or treatment'' of hazardous substances at a particular site [42 U.S.C. }9607(a)]. CERCLA imposes strict, retroactive liability upon PRPs for environmental response costs at Superfund sites. Though not clearly de®ned in the Act, liability under CERCLA has typically been interpreted as ``joint and several''. The legal doctrine of joint and

{Author for correspondence. E-mail: [email protected] }E-mail: [email protected] **E-mail: [email protected] {{E-mail: [email protected] }}E-mail: [email protected]

47 1527-5922/00/010047+08 $35.00/00

# 2000 AEHS

48 R.A. Marryott et al.

several liability allows one PRP to be held responsible for all cleanup costs at a Superfund site based on evidence that it contributed at least some contamination to the site. A PRP can overcome the presumption of joint and several liability only by establishing the ``divisibility'' of its contribution from the total environmental harm that has occurred at the site. In other words, the PRP must demonstrate that it contributed to a distinct harm or that there is a reasonable basis for determining its contribution to a single harm among multiple contributors; in general, this strategy has had little success (Byl and Felton, 1994; Murphy, 1996). When commingled contaminant plumes are present, the burden of proof on the PRP is more dicult, making this strategy even less plausible. The basic Superfund process typically proceeds as follows. First, EPA identi®es the PRPs that it considers to be responsible for contamination at the site. The PRPs are then noti®ed of their potential liability through General Notice Letters. Shortly thereafter, EPA, the Department of Justice, and possibly state or local agencies begin negotiating with the PRPs to either initiate cleanup activities themselves or to reimburse EPA and its contractors for their costs. In many cases, the PRPs choose to form a group and carry out response actions themselves. By managing the work themselves, the PRPs have greater control over the costs they incur. Regardless of the cooperation shown by the PRPs during the remedial process, allocation of the incurred costs between the group members is often a highly contentious matter. Superfund unfortunately provides very little guidance with regard to allocation. There is some indication that Congress originally intended allocation decisions to be made on a case-by-case basis (Evans, 1996). Consequently, a variety of di€erent allocation techniques have been used to apportion response costs between PRPs. This has resulted in disparate and inconsistent allocation at Superfund sites ( for example, see the case histories reviewed in Butler et al., 1993 and Hall, Harris and Reinsdorf, 1994, among others). CERCLA Section 113 ( f)(1) states that ``[i]n resolving contribution claims, the court may allocate response costs among the liable parties using such equitable factors as the court determines are appropriate'' [42 U.S.C. }9613( f)(1)]. However, the statute and its legislative history o€er the courts little guidance on how to actually allocate costs, leaving the courts broad discretion to consider any number of ``equitable factors'' that they deem appropriate. The criteria most frequently cited and used by the courts in Superfund allocation cases are the so-called ``Gore factors'', which include the volume, toxicity, and mobility of the waste; the degree of involvement of the parties; the degree of care exercised in handling the waste; and the degree of cooperation of the parties with the authorities (Hall, Harris and Reinsdorf, 1994). EPA has been reluctant to provide clear guidance in the area of allocation. However, in many cases, EPA has focused on the volume of waste as the primary relevant factor in allocating cleanup costs. In practice, Superfund allocations are generally approached from a practical point of view. Allocation schemes are developed on a case-by-case basis to be functional and to achieve resolution. Most methods

lack the conceptual framework necessary to evaluate all of the allocation issues. Response costs have often been apportioned based on the amount (i.e. mass or volume) of waste released or disposed of at the site by each PRP. This method inherently assumes that the cost of remediation is proportional to the amount of waste disposed, which may not always be the case. Despite its shortcomings, this ``volumetric'' approach is frequently employed because the disposal information is either readily available or the relative amounts are easy to estimate. In some cases, the relative toxicity of the contaminants is factored into the allocation along with the volume of waste (e.g. weighting the costs of the risk-driving contaminants more than other compounds). Allocation techniques suggested in the literature include ``matrix'' methods (Hall, Harris and Reinsdorf, 1994), risk assessment (Murphy, 1996; Mink, Nash and Coleman, 1997), and allocation based on economic principles (Butler et al., 1993; Wise, Maniatis and Koch, 1997). This paper presents a method for allocating remedial costs between PRPs that have contributed to the contamination in a commingled groundwater contaminant plume. The method is essentially a hybrid, incorporating concepts from both economic analysis and risk assessment.

Problem De®nition In this paper, we assume that a large plume of dissolved groundwater contamination at a Superfund site is to be remediated and that the remedial costs associated with the cleanup are to be fairly and equitably allocated. EPA has identi®ed a group of PRPs that it considers to be responsible for the contamination. The overall plume is made up of smaller, individual overlapping or commingled plumes contributed by each of the PRPs. Each plume contains either a single contaminant or a number of di€erent chemicals of concern (COCs) that must be remediated. EPA has required the PRP group to initiate and pay for remediation of the collective plume, and the group faces the task of allocating the costs associated with these activities. The costs associated with any PRPspeci®c site remediation (e.g. contaminant source areas) are not included in the allocation. The allocation method developed in this paper focuses on the costs of remediating multiple PRP groundwater contaminant plumes using the pump and treat method. Pump and treat remedial costs are driven not only by the mass of contaminants to be treated but also by the volume of groundwater to be extracted. Allocation methods based solely on the mass of contaminants contributed by each PRP are inadequate for pump and treat remedial scenarios. The proposed allocation methodology could be extended to other remedial technologies (e.g. funnel and gate, air sparging, etc.) that have similar mass and volume considerations.

Inequity of Mass Only Allocation Methods An allocation scheme based solely on a PRP's contribution of mass to a groundwater plume is likely to be inequitable. Consider the following hypothetical

Allocating Remedial Costs at Superfund Sites 49

example. PRP A is responsible for the release of 10 kg of contaminant to an aquifer in 1970. PRP B is also responsible for the release of 10 kg of the same contaminant to the aquifer, however, PRP B's release occurs 20 years later, in 1990. The plume attributable to PRP A is much larger than that attributable to PRP B, with mass spread over a larger volume of groundwater. PRP B's plume is smaller than PRP A's plume but has much higher average concentrations in groundwater. How should the remedial costs be apportioned? If the allocation for this example were based solely on the mass of contaminant released to the aquifer, both PRPs would pay the same amount (i.e. half of the remedial costs). However, the mass of contaminant released only represents a portion of the environmental damage caused by each PRP. For example, PRP A's plume has contaminated a much larger volume of groundwater, thus creating more damage by potentially rendering a larger volume of groundwater unsuitable for use. Furthermore, the remedial costs associated with PRP A's plume will in large part be driven by volume considerations because, in general, a larger plume requires: (1) a greater amount of extraction and treatment; (2) a longer time to remediate; and (3) a greater number of monitoring wells to demonstrate compliance. Therefore, since PRP A has contaminated a much larger volume of groundwater, the cost to contain and/or remediate PRP A's contamination would likely be greater than the cost to contain or remediate PRP B's contamination. In other words, PRP A's ``stand-alone'' cost (i.e. the cost to remediate PRP A's plume alone) would likely be greater than PRP B's stand-alone cost. Therefore, PRP A should pay more of the remedial costs than PRP B. This simple example demonstrates that the same mass of contaminant may cause signi®cantly di€erent damage to the environment. Consequently, an allocations scheme that is based solely on mass will likely result in an inequitable solution.

where fi is the fraction of the total cost attributable to PRPi (i.e. the allocation share or the cost share), SACi is the individual stand-alone cost for PRPi , and n is the total number of PRPs in the allocation. The calculated cost share is multiplied by the total cost of the combined remedial system to determine the cost allocated to each PRP. It should be noted that, while fi is a simple ratio involving the stand-alone costs, computing the individual SACi is not a trivial matter. In order to calculate a stand-alone cost, a PRP must ®rst select a remedial technology, then perform a remedial design analysis, and ®nally estimate the cost of the resulting remedial design. Allocation by the stand-alone method can be illustrated by a hypothetical example. Consider the contaminant plume depicted in Figure 1. The combined plume (bold) is made up of three smaller, commingled plumes (dotted) that have been contributed by PRPs A, B, and C. Assume that, if each PRP were to remediate its own plume, the cost for PRP A would be $300,000; for PRP B, $100,000; and for PRP C, $200,000. If each PRP were to manage its own remedial system, the total cost would be $600,000. Now assume that a single, optimally designed system can be implemented that will remediate the combined plume for a cost of $400,000. By joining together and funding the single remedial system, the PRP group can realize a potential cost saving of $200,000. How should the PRP group allocate the cost of the combined remedial system? PRP A would argue that the cost should be split evenly, with each PRP paying $133,333. PRP C would likely go along with this proposal, but PRP B probably would not, since its stand-alone cost is only $100,000. Thus, PRP B would not have any incentive to participate in the group, and

Allocation Based on Stand-Alone Costs The stand-alone cost method is an allocation technique that is derived from economics (Butler et al., 1993; Wise, Maniatis and Koch, 1997). Economic principles provide an objective and consistent framework that is useful in addressing allocation problems. The basic idea behind the stand-alone cost method is that each PRP should pay in proportion to the cost that it would have incurred absent of the activities of the other PRPs. If each PRP were to remediate its own contribution to the plume, it would incur a certain cost. By implementing a single remedial system, all PRPs bene®t from the economies of scale and the elimination of the redundancy of multiple systems, thereby yielding a total cost that is less than the sum of the individual stand-alone costs. The cost savings are then distributed in proportion to the costs that each PRP would have incurred had it managed its own remedial system. Mathematically, the stand-alone approach can be expressed as: SACi f i ˆ Pn iˆ1 SACi

…1†

Figure 1. Hypothetical contaminant plume caused by three PRPs. The combined plume is shown by the bold line, while the individual PRP plumes are depicted by dotted lines.

50 R.A. Marryott et al.

the potential savings for all PRPs would not be realized. If the stand-alone approach were followed, each PRP would save in proportion to its respective stand-alone cost. Using the methodology described above, each PRP would pay based on the ratio of its stand-alone cost to the sum of the stand-alone costs. PRP A would pay one-half ($300,000/$600,000), PRP B would pay one-sixth ($100,000/$600,000), and PRP C would pay one-third ($200,000/$600,000) of the $400,000 total cost. Note that following this method, each PRP pays the same fraction ($400,000/$600,000 or two-thirds, in this case) of its stand-alone cost; thus, each PRP realizes the same relative cost saving.

Allocation Based on Contribution to the Environmental Damage In the ideal situation, remedial costs would be estimated for each PRP and, as in the preceding example, allocation shares would be calculated using the stand-alone method. In many cases, however, it may not be possible to obtain estimates of the individual remedial costs. For example, the number of PRPs in the allocation may be suciently high that individual cost analysis becomes too costly. In other situations, the site data for some of the PRPs will not support a cost analysis. Moreover, estimating remedial costs for individual PRPs may require speculation regarding the requirements to be imposed by regulatory agencies. If the stand-alone costs cannot be estimated for all PRPs in a consistent manner, the allocation results will not be meaningful and most likely will be inequitable. When the response costs cannot be apportioned based on the individual remedial costs, a surrogate can be used to approximate the stand-alone costs. Surrogates are often used in allocation when the available data are inadequate to perform a complete and fair comparison between PRPs (EPA, 1994). For example, when disposal records are not available, quantities such as volumes of waste produced, amounts of chemicals purchased, or even annual sales, could potentially be used as a surrogate for the amount of waste disposed. The important point is that the surrogate or surrogates should be used consistently for all PRPs. The selective use of surrogates may penalize some PRPs for having good records and reward others for a lack of information. For the case of remediating a groundwater contaminant plume, an appropriate surrogate can be determined by examining the contribution to the environmental damage (i.e. the injury to the environment that has required a remedial action). Each PRP has contributed to the damage to some degree by releasing a certain mass of contaminant to the groundwater. The contamination from each PRP occupies some volume of groundwater, which de®nes that PRP's plume. If we use the mass and volume in each plume as a cost surrogate, we can account not only for each PRP's relative contribution to the environmental damage, but also for some measure of its contribution to the cost, since pump and treat remedial costs depend upon both mass and volume factors. For example, the

volume of water to be extracted will drive utility costs, the number and location of extraction wells, the size of pumps and transmission pipelines, and the capacity of the treatment facility, whereas the mass to be removed from the extracted water will drive the treatment costs. Thus, an equitable allocation can be based on each PRP's relative contribution of mass and volume to the plume.

Proposed Allocation Approach Basis for liability We propose the following method for allocating costs between PRPs at Superfund sites with commingled groundwater contaminant plumes. Under the proposed methodology, liability is based on contribution to the environmental damage, which is the amount of contamination that each PRP has contributed to the plume. Contribution to the damage is expressed as a weighted sum of the mass of contaminant and the volume of contaminated groundwater attributable to each party. In this formulation, the mass and volume serve as surrogates for the stand-alone costs that would be required if each PRP were to manage its own remedial system. Under the proposed approach, allocation shares, fi , are apportioned based on relative contribution to the damage. We will designate CTDi as the individual contribution to the damage for PRPi . Following the stand-alone approach described in equation (1), allocation shares are calculated as: CTDi f i ˆ Pn iˆ1 CTDi

…2†

for each PRP. The individual contribution to the damage is de®ned as: CTDi ˆ gM Mi ‡ gV Vi

…3†

where Mi and Vi are the mass of contaminant and volume of contaminated water attributable to PRPi , and gM and gV are coecients that represent the contribution to the damage per unit mass and volume, respectively. Since mass and volume are surrogates for the stand-alone costs, these coecients could represent cost conversions factors (i.e. cost per unit mass or volume). Substituting equation (3) into equation (2) yields: g Mi ‡ gV Vi g Mi g Vi Pn fi ˆ M ˆ Pn M ‡ Pn V CTD CTD i i iˆ1 iˆ1 iˆ1 CTDi

…4†

where the two terms on the right-hand side of equation (4) represent the relative mass and volume contributions to the damage, respectively. If we de®ne: Pn Pn Mi Vi oM ˆ gM Pn iˆ1 and oV ˆ gV Pn iˆ1 CTD CTD i i iˆ1 iˆ1 then equation (4) can be rewritten as: Mi fi ˆ oM Pn

iˆ1 Mi

Vi ‡ oV P n

iˆ1

Vi

…5†

Allocating Remedial Costs at Superfund Sites 51

where fi is now a weighted sum of the relative mass attributable to PRPi (i.e. the mass share) and the relative volume attributable to PRPi (i.e. the volume share) and oM and oV are the weighting factors. The weighting factors range from zero to one. The sum of the weighting factors is one. They can be determined based on the proportion of remedial costs due to mass and volume factors. For example, if volume components (i.e. wells, pumps, pipelines, treatment plant capacity, etc.) comprise three-fourths of the remedial costs, then oV would be 0.75 and oM would be 0.25. Determination of individual plumes The proposed allocation approach implicitly assumes that the mass and volume of each PRP's plume can be estimated. At most Superfund sites, ®eld data are available to accurately delineate the overall extent of contamination. However, it is usually not possible to segregate individual plumes from one another using only ®eld measurements. We propose the use of solute transport modeling to delineate individual PRP plumes. Transport modeling is one component of risk assessment, which is conducted in one form or another at every Superfund site in the country. As opposed to other methods of plume delineation, transport modeling is relatively unbiased, reproducible, and able to account for uncertainty. Other methods can also be used to delineate individual PRP plumes. For example, hand contouring of groundwater concentration data was the approach implemented by another PRP during an allocation proceeding in which the authors were previously involved. These types of methods are subjective, however, relying on the professional judgement of the analyst, particularly where data from overlapping plumes must be separated and attributed to two or more parties. In certain situations, other methods of plume delineation may be warranted, but in general, we believe modeling to be the best approach. Models used in allocation can be simple (e.g. analytical solutions) or more detailed in nature, depending upon the complexity of the site, the desired e€ort, and the availability of existing site models, among other factors. Fortunately, the mass and volume terms in equation (5) are relative (i.e. they are mass ratios and volume ratios). Therefore, the modeled plumes do not necessarily need to be precisely calibrated to ®eld data, they only need to provide reasonable estimates of the relative mass and volume contributions from each PRP. As with any modeling e€ort, calibration to observed data is desirable. However, a ``reasonable'' calibration of PRP plumes may be entirely adequate if the allocation results are relatively insensitive to calibration improvements. In terms of allocation, model calibration should be based both on the relative accuracy of the plumes and the sensitivity of the allocation results. The key parameters in the modeling analysis, the source locations, magnitudes, and release times, typically can be estimated from historical records and/or site data. Contaminant source locations can be delineated from site-speci®c ®eld investigations or from known or suspected release points (e.g. locations of spills, leaking tanks, etc.). Source magnitudes can be estimated from analytical data such as soil or

groundwater concentrations or from known release amounts (i.e. the mass or volume of contaminants spilled or released). Source timings can be derived from historical chemical use data or known release dates. The most important consideration is that the modeling strategy should be applied consistently for all PRPs in the allocation. Given a source location, magnitude, and start date, a transport model can be used to simulate the historical development of a plume to the present or to some time in the future at which the remedial system will be operating. At that time, the extent of the plume can be delineated by a bounding concentration contour, typically a state or federal maximum contaminant level (MCL) for the contaminant of concern. The total volume of contaminated groundwater within that boundary represents the volume of the plume. Similarly, the mass of contaminant within the volume represents the mass of the plume.

Illustrative example Returning to the example described earlier, assume that the stand-alone remedial costs for the three plumes depicted in Figure 1 cannot be evaluated. Assume, however, that the mass and volume of each plume can be estimated using a model as described above. PRP A has contributed 45 kg of contaminant over a volume of 1 million liters (106 L); PRP B, 25 kg over 300,000 L; and PRP C, 30 kg over 500,000 L. The sum of the masses contributed by each PRP is 100 kg; the sum of the volumes is 1.8  106 L. To allocate remedial costs based on the mass and volume of the individual plumes, we must ®rst calculate the relative mass and volume shares. The relative mass shares are calculated by dividing the individual mass from each PRP by the sum of the masses from all PRPs. Thus, the relative mass share for PRP A is 0.45 (45 kg/100 kg); for PRP B, the mass share is 0.25 (25 kg/100 kg); and, for PRP C it is 0.30 (30 kg/100 kg). Similarly, the relative volume shares are calculated by dividing the individual plume volumes by the sum of the volumes. For PRP A, the relative volume share is 0.55 (1  106 L/ 1.8  106 L); for PRP B, 0.17 (0.3  106 L/ 1.8  106 L); and, for PRP C, 0.28 (0.5  106 L/ 1.8  106 L). The total allocation shares are determined by weighting the mass and volume shares and summing the resulting weighted shares; as mentioned earlier, the weighting factors should be derived from the actual remedial design. For the present example we will assume that the mass and volume shares are weighted equally (i.e. oM ˆ oV ˆ 0:5†: The ®nal allocation shares are approximately one-half for PRP A, one-®fth for PRP B, and three-tenths for PRP C (see Table 1). Using the mass and volume shares from Table 1, we can evaluate the sensitivity of each PRP's ®nal allocation share to the assumed mass/volume weighting. Note that PRP A's ®nal share can vary from 0.45 (all mass) to 0.55 (all volume), while PRP C's share is basically insensitive to the weighting in this example.

52 R.A. Marryott et al. Table 1. Comparison of allocation results: stand-alone cost method v. contribution to the environmental damage Stand-alone cost method PRP A B C

Stand-alone cost $300,000 $100,000 $200,000

Allocation share 0.50 0.17 0.33

Contribution of mass and volume to the damage

Allocated cost*

Mass (kg)

Volume (106 L)

$200,000 $68,000 $132,000

45 25 30

1.0 0.3 0.5

Mass share 0.45 0.25 0.30

Volume share 0.55 0.17 0.28

Allocation share{ 0.50 0.21 0.29

Allocated cost* $200,000 $84,000 $116,000

*Cost of joint remedial system is $400,000. {Weighting of mass and volume shares is equal.

Variations on the Approach The allocation approach described in the previous section provides a basic framework for apportioning remedial costs between PRPs at Superfund sites with commingled groundwater contaminant plumes. Each site, however, will have di€erent issues that need to be addressed and incorporated into the allocation process. By performing a few simple variations on the basic allocation approach, a number of di€erent situations can be taken into consideration. Some of these situations are discussed below.

required a treatment option that costs ®ve times as much as the other two chemicals, then the weighting factor for the mass contribution of the higher toxicity chemical should be roughly ®ve times that of the other chemicals. Even if the treatment of chemicals with higher relative toxicities does not increase the cost of the remedy, it can be argued from a health-based perspective that the mass contributions for the higher toxicity constituents should be weighted higher than the mass contributions of the other chemicals. This point should be addressed and agreed upon by the PRP group.

Accounting for multiple COCs and variations in toxicity

Allocating nonremedial costs

In many situations, contaminant plumes are comprised of more than one chemical species. Chemical usage at individual PRP facilities often changes over time and di€erent PRPs use and/or handle di€erent chemicals. The composite ``plume'' to be remediated frequently consists of overlapping multi-chemical plumes contributed by multiple PRPs. The proposed allocation method can accommodate the added complexity of additional contaminants by explicitly accounting for the mass and volume of each chemical of concern. Under the proposed methodology, this requires a transport simulation for each contaminant that a PRP is known or suspected to have used and/or handled. The total mass contributed by each PRP [i.e. Mi from equation (5)] is the sum of the individual masses for each contaminant. The total volume contributed by each PRP [i.e. Vi from equation (5)] is the volume enclosing the plumes for all the contaminants. The preceding discussion assumes that the relative toxicity for each of the contaminants is essentially the same. However, in many cases some chemicals will have higher toxicities than others. These constituents may require the use of additional treatment technologies, thereby increasing the overall cost of the remedy. To account for the increase in cost associated with these constituents, PRPs that contribute higher toxicity chemicals should receive higher allocation shares than those PRPs that do not. One way to adjust the allocation shares for toxicity is to weight the mass contributions of the higher toxicity chemicals greater than that of the other chemicals. Appropriate weighting factors can be developed using the relative costs of the treatment options needed to address the various contaminants. For example, if three chemicals were to be treated, and one constituent

Parties identi®ed by EPA through General and Special Notice Letters are typically responsible for all of the response costs at a Superfund site. Nonremedial costs include investigatory costs, EPA oversight costs, and a variety of transactional costs. It may be argued that investigatory costs, such as remedial investigation and feasibility study (RI/FS) costs, oversight costs, and many transactional costs, such as the costs associated with agency negotiations, should not be allocated on the same basis as the costs of implementing and operating the remedy. In some cases, it may be equitable to separate a portion of these costs from the remedial costs and allocate them on an equal, or ``per capita'', basis. This may be preferred when certain costs, such as negotiations with a regulatory agency, are not clearly related to the degree to which PRPs have contributed to the contamination. On the other hand, when the nonremedial costs are relatively small compared to the remedial costs, PRP groups have often chosen for expediency and cost eciency to allocate them using the same methodology as that used to allocate the costs of the remedy. At many Superfund sites, investigatory costs are signi®cant compared to remedial costs. In these cases, if the PRPs feel that the investigatory costs should be allocated on a separate basis from the costs of the remedy, the RI/FS costs can be categorized (e.g. monitoring well installation, groundwater sampling, soil borings, soil sampling, etc.) and reasonably allocated to those PRPs whose releases necessitate the investigation. For example, the costs of soil borings and soil sampling on a PRP's property should be allocated directly to that PRP. Similarly, the costs of monitoring well installation and groundwater sampling in the areas immediately upgradient and downgradient of a PRP's facility should also be allocated solely to

Allocating Remedial Costs at Superfund Sites 53

that PRP. The costs of monitoring well installation and groundwater sampling from wells that arguably would be necessary to characterize the plume from more than one PRP should be allocated among all such PRPs. In the hypothetical example illustrated by Figure 1, it is anticipated that PRP A would be allocated the largest share of the investigatory costs since its plume is the largest and should require the most extensive investigation, unless the areal extents of PRP B's or PRP C's properties require disproportionate on-site investigations. All investigatory costs upgradient of PRP B and PRP C would likely be allocated solely to PRP A, while all three PRPs would share the investigatory costs in those locations where the plumes are overlapping. Crediting on-site remedial e€orts If a PRP has initiated a localized, property-speci®c remedial e€ort that is independent of the overall site remediation and will augment the larger-scale remedial e€ort, then it is appropriate and equitable to adjust (i.e. reduce) the allocation share for that PRP. Share adjustments for on-site remedial e€orts can be accomplished under the proposed allocation approach in either one of two ways: (1) by explicitly incorporating the e€ects of the remedial system into the transport modeling; or (2) by implicitly accounting for the system by subtracting the mass and volume of contaminated groundwater that is subject to on-site remediation from the plume of the PRP initiating the site-speci®c cleanup. In either case, the adjustment will often result in a substantial decrease in the PRP's costs. This approach may also provide the motivation necessary for PRPs to initiate on-site remediation, thus reducing the long-term cost of the larger-scale site remediation. Accounting for nonparticipating parties At many Superfund sites, the PRPs that have negotiated with EPA to undertake response actions have less than full responsibility for the contamination. In most cases, some of the PRPs that are originally noti®ed of their potential liability by EPA choose not to participate in response e€orts; others either no longer exist or are insolvent. These non-participating parties are referred to as recalcitrants and orphans, respectively. Recalcitrants and orphans are PRPs that have contributed to the contamination at the site but not to the funding of the cleanup e€ort. Under CERCLA Section 113, any member of the PRP group may seek reimbursement from the nonparticipating parties through legal action [42 U.S.C. }9613( f)(1)]. The proposed allocation approach provides a consistent framework for quantifying the damages due to each PRP, including recalcitrants and orphans. By developing a plume for each PRP, allocation shares can be calculated for all parties, participants and nonparticipants. Apportioning the costs due to orphan PRPs may depend upon the total cost of the orphan shares (e.g. smaller costs might be split evenly among the group). In principle, orphan shares can be recovered from EPA; however, cost recovery using Superfund money is rare (Evans, 1996). Recently proposed legislation includes provisions for a

``fair share'' allocation that would potentially limit the liability of PRP group members, either forcing the balance of the costs on to recalcitrant PRPs or allowing for some contributions from EPA (Jacobs, 1999). Allocating between PRP subgroups During an allocation proceeding some of the individual PRPs in a group may join together to form an alliance or subgroup. The subgroup will typically seek to receive a single allocation share, as if it were a single PRP and not a group comprised of individual PRPs. The logic behind the subgroup's approach is the same as that behind the entire PRP group's approach. By joining together, any ``group'' can reduce its costs. Hence, the subgroup's allocated cost will generally be less than the sum of the individual costs for the PRPs in the subgroup. However, since the total cost being allocated must come from the members of the PRP group, the costs saved by the subgroup must be absorbed as a cost increase by the remaining PRPs in the larger group. If every PRP in the group were to join a subgroup to reduce its costs, there would be only one ``PRP'' and therefore no need to allocate. The most equitable approach, when addressing subgroups, is to perform the allocation based on individual PRPs and then to add up the individual cost shares to determine the subgroup's share. Notwithstanding the previous discussion, there still may be certain situations where allocating between PRP subgroups is necessary. In these cases, allocating between subgroups using the proposed allocation approach must be handled very carefully or the allocation results may become inequitable. The problem centers on the overlap or commingling of individual plume volumes. When two or more overlapping plumes are considered to represent the combined plume from a single ``PRP'', the mass in the combined plume is the same as the sum of the masses from the individual plumes. The volume in the combined plume, however, is less than the sum of the volumes from the individual plumes because the volume overlap is not counted. Thus, the volume share of the combined plume is less than the volume shares from the individual plumes. The total allocation share for the subgroup is therefore less than the sum of the individual shares for the PRPs in the subgroup. The important point to note is that the subgroups must be selected carefully to minimize the e€ect of volume overlap. It must also be emphasized that allocating between subgroups and individual PRPs is inherently inequitable to the individual PRPs. Once again consider the hypothetical scenario depicted in Figure 1. Assume that PRPs A and B join together to form a subgroup that is treated as a single ``PRP'' in the allocation. Now there are two PRPs in the allocation, PRP A-B and PRP C (Figure 2). PRP A-B has contributed 70 kg of mass and, excluding the volume overlap of the two separate PRPs (essentially all of PRP B), the combined A-B plume has contributed 1.05  106 L of volume. As before, PRP C has contributed 30 kg of mass and 0.5  106 L of volume. The relative mass shares are 0.70 (70 kg/100 kg) for PRP A-B and 0.30 (30 kg/ 100 kg) for PRP C; the relative volume shares are 0.68 (1.05  106 L/1.55  106 L) for PRP A-B and 0.32

54 R.A. Marryott et al.

remediation and is inherently inequitable. As such it is not an appropriate basis for the ®nal allocation. If the life of the interim remedy were to be extended for any length of time, or if the interim allocation shares were, in e€ect, ``locked in'' for all or part of the ®nal remedial activities, the entire process would be inequitable and would unduly penalize certain PRPs based on their proximity to the recovery system. A separate allocation proceeding must be held to account for costs associated with the ®nal remedy.

Summary and Conclusions

Figure 2. Hypothetical contaminant plume caused by 3 PRPs. PRPs A and B have joined together to form a subgroup with a single plume. Note that the combined plume is the same as that shown in Figure 1.

(0.5  106 L/1.55  106 L) for PRP C. Applying an equal mass to volume weighting results in a ®nal allocation share of 0.69, or $276,000, for PRP A-B and 0.31, or $124,000, for PRP C. By joining together, PRPs A and B have saved 2% of the total cost, or $8000, which has been absorbed by the remaining PRPs in the group, which in this case is only PRP C. Note also that PRPs A and B must decide how they will apportion the subgroup's total cost share between themselves. Allocating interim remedial actions Short-term, or interim, remedial measures may be required at some Superfund sites. In these situations, an alternate approach for allocating costs can be developed with the understanding that the resulting allocation is ``temporary'' and applies only for a period of time to be agreed upon by the PRP group or to be speci®ed by EPA as corresponding to the time frame of the interim remedy. For example, the argument may be made that the interim allocation should be based on the portion of each PRP's contamination, both mass and volume, that is captured and treated by the interim remedial system during its ®nite period of operation. Under this scenario, PRPs whose plumes are located closer to the recovery wells will pay the brunt of the costs. As long as the interim remedy is treated separately from the ®nal remedy, this approach may be acceptable to the group. However, this approach to interim allocation does not take into consideration the full extent of contamination that is driving the need for

Contamination of groundwater is a dicult problem to address, not only in terms of remediation, but also with respect to allocating liability and environmental response costs. This paper proposes a method for allocating remedial costs between PRPs at Superfund sites with commingled groundwater contaminant plumes. Under the proposed methodology, liability is based on the amount of contaminationÐexpressed in terms of both the mass of contaminant and the volume of contaminated groundwaterÐthat each party has contributed to the plume being remediated. In this formulation, the mass and volume serve as surrogates for the stand-alone costs that would be required if each PRP were to implement its own remedial system. For pump and treat remedial systems, this is an equitable basis for allocation since a portion of the remedial costs are driven by the volume of water that must be extracted and a portion of the costs are driven by the mass of contaminants that must be treated. Variations on the proposed approach can accommodate a number of equitable factors that may be useful in Superfund allocations. The authors have successfully used the proposed allocation approach, or variations of the approach, in several Superfund allocation proceedings.

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