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EPA’s Designation of Certain PFAS as Hazardous Substances Under CERCLA Will Have Wide-Ranging Impacts

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On April 19, 2024, the United States Environmental Protection Agency (EPA) issued a pre-publication final rule and an associated enforcement policy concerning two common types of per-and polyfluoroalkyl substances (PFAS): perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS).[1] In the rule, EPA designated PFOA, PFOS, and their salts and isomers as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). This designation will have broad implications for not only CERCLA remediations, but also property transactions, facility reporting obligations, and transportation of PFOA- and PFOS-containing materials. Given the ubiquity of these regulated PFAS and the scope of relative “innocents” that would be classified as responsible parties under CERCLA, EPA contemporaneously issued a policy indicating how it will exercise its enforcement discretion in matters involving PFAS.

Final Rule

PFAS are synthetic compounds that have become prevalent in the environment due to their long-term use in the manufacture of many different products. PFOS and PFOA were used in common products like nonstick cookware, food packaging, stain repellents, water-resistant clothing, carpet, and electronics. PFAS chemicals are frequently referred to as “forever chemicals” because they do not break down naturally. This means that they are found almost everywhere – including in the human body – and are very difficult to clean up.

Including PFOA and PFOS as hazardous substances will allow federal, state, and local government, as well as private parties, to use CERCLA to pursue parties that currently own or operate, formerly owned or operated, or sent or transported PFOA- or PFOS-containing materials to sites that are contaminated with PFOA or PFOS. As the regulated community knows, CERCLA is unforgiving, and potentially liable parties should be prepared for cleanup and cost recovery claims similar to those faced since the late 1980s for industrial solvents, metals, and PCBs. 

Parties already cleaning up sites under a CERCLA order or decree should expect EPA to require sampling for PFOA and PFOS, and potentially EPA seeking to include PFOA or PFOS as constituents to be remediated. EPA may also seek to include the relatively new federal drinking water standard, 4.0 parts per trillion for PFOA and PFOS, as a remediation goal.

Including PFOA and PFOS as hazardous substances means Phase I investigations will need to consider these chemicals’ potential impacts on subject sites. Given their relative ubiquity in the environment and frequent use in products, environmental consultants will be wrestling with when current and historical property use poses a recognized environmental condition (REC), a business environmental risk, or nothing worth mentioning. Overly-conservative RECs may impede deals or lending, but overly-rosy conclusions may miss a real threat and possibly open up a consultant to claims from clients.

Consultants should also expect an increase in clients asking whether the client’s releases of PFOA or PFOS can be distinguished from PFOA or PFOS that already exists in the environment.  A client’s equitable allocation or divisibility defense could turn on such evidence.

In addition to remediation concerns, facilities will also become subject to CERCLA release reporting requirements for PFOA and PFOS. After the Final Rule becomes effective, facilities will be required to immediately report releases of PFOA and PFOS above their current “reportable quantity” of one pound within a 24-hour period to the National Response Center and applicable state and local agencies.

Also, companies that ship items that contain PFOA and PFOS will eventually become subject to more stringent transportation regulations, as this CERCLA designation will lead the Department of Transportation to list and regulate these substances as hazardous materials under the Hazardous Materials Transportation Act.

EPA is expected to publish the final rule in the Federal Register this spring or summer. Absent a challenge resulting in a stay, the rule will be effective 60 days after publication. If a stay is granted, the rule will not be effective until the challenge is resolved, and then according to the terms of the resolution.

Enforcement Policy

Per its April 19, 2024, enforcement policy, EPA intends to focus its enforcement efforts on parties that significantly contributed to the release of PFOA or PFOS to the environment, such as parties that manufactured PFOA/PFOS or used these chemicals in manufacturing processes, federal facilities, and other industrial parties. At the other end of the spectrum, EPA does not intend to pursue otherwise responsible parties that EPA believes are more “innocent,” such as community water systems and publicly owned treatment works, municipal separate storm sewer systems, publicly owned/operated municipal solid waste landfills, publicly owned airports and local fire departments, and farms where biosolids are applied to the land.

However, because CERCLA allows liable parties to seek contribution from other liable parties, EPA’s enforcement discretion cannot completely shield these arguably more innocent actors. To address this, per the enforcement policy, EPA might require settling parties to waive their rights to sue parties EPA believes should be left alone. EPA could also settle with more innocent parties, thereby providing protection from significant parties’ contribution claims. The application of this discretion will certainly be site-specific.

If you have any questions concerning this final rule and how it may impact you, please do not hesitate to contact your Quarles & Brady attorney or:

[1] Our discussion of EPA’s August 26, 2022 proposal can be found here. 

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