The Potential Impact of a Federal Subsidy Program on the Pace of Cleaning up Superfund Sites

Edward Mensah
Michael Cailas
Eric Zimmerman

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DOI: 10.2190/Q0TL-596A-A5Y6-HUCH

Abstract

The Superfund program was established by Congress in 1980 to clean up the worst inactive hazardous waste sites in the nation. The doctrine of strict, joint and several, and retroactive liability is the legal basis for enforcing the Superfund regulations. The liability allocation system has become very contentious, generating considerable transaction costs and leading to cleanup delays. In spite of several regulatory reforms aimed at improving the pace of cleanup and reducing the transaction costs, cleanup durations have not improved. The major objective of this study is to explore the effectiveness of creating Federal subsidies to pay for a fraction of cleanup costs contingent upon the expeditious settlement of Superfund liability disputes. The distribution of total cleanup costs from USEPA Region V (Midwest) suggests that the introduction of a fixed subsidy aimed at settling liability disputes at smaller sites may be effective in speeding up the pace of cleanup. The value of analysis presented in the study is in the identification of a defined target market for subsidies and the exploration of conditions under which such a market might be successful in improving the effectiveness of the Superfund program.

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