WAITING A fence to keep people out and a cap to prevent leaching of wastes have been installed at the Chemical Insecticide Corp. Superfund site in Edison Township, N.J., shown here in 1997. A decision on federal funding for excavation and disposal of contamination remains pending. CHEMICAL INSECTICIDE CORP. PHOTO

Federal Superfund activities to clean up major hazardous waste sites have never totally relied on the revenues from the special taxes. Congress has always supplemented these dollars with money from the general revenue fund--paid by taxpayers at large--as it doles out the appropriation for EPA's Superfund activities each year.

The annual appropriations for Superfund have ranged from $1.3 billion to $1.6 billion over the past decade. Since Superfund's inception in 1980, general revenues have constituted roughly 20% of all appropriations for the program, according to William O. Ross, senior process manager for reform in EPA's Superfund program.

However, the amount of general tax revenues Congress has used to keep the Superfund program going has increased in recent years. In 2000, funding from general revenues increased to 50% of the total, according to EPA figures, and it has remained there ever since. Because the account holding the special Superfund tax dollars is almost empty, that percentage is expected to rise in coming years.

Exhaustion of the Superfund trust fund comes as the federal government faces belt-tightening in the face of projected deficits. While past arguments over Superfund focused on reforming the administrative and legal processes to effect more efficient cleanups, discussion in Washington, D.C., now increasingly is focused on the dwindling dollars in the Superfund tax account and whether this is hampering cleanup of Superfund sites.

The Bush Administration opposes reinstatement of the Superfund taxes. Not surprisingly, so does the chemical industry, which paid billions in levies. The Administration says the lack of money in the trust fund won't slow down cleanup of remaining Superfund sites and plans to ask Congress to make up the difference with general tax revenues. The chemical industry supports this idea.

But environmental groups and a number of federal lawmakers are disturbed about the shrinking balance of the trust fund. They say that providing money from the general tax coffers goes against a major principle established in the Superfund law--that polluters pay for cleanup. They fear, too, that EPA is failing to fund cleanups of some Superfund sites because the account is almost dry. They want the Superfund taxes renewed.

CONGRESS PASSED the Superfund law--officially the Comprehensive Environmental Response, Compensation & Liability Act--in 1980 after two notorious hazardous waste disposal sites captured the public's attention. One was the Valley of the Drums, an open-air dump in Kentucky, where drums strewn over a huge swath of land leaked chemical wastes into the Appalachian countryside. The second was Love Canal, N.Y., where the Hooker Chemical Co., now OxyChem, disposed of wastes in the never-completed clay-lined canal near the Niagara River in the 1940s and '50s. A school was later built atop the site. Love Canal gained national attention in 1978 after chemicals were found oozing from the dump. The federal government eventually moved hundreds of families from the area.

Today's Superfund sites are generally less dramatic in their appearance. Many are old industrial sites surrounded by chain-link fences, awaiting a final cleanup plan or federal dollars needed to fund removal of pollution. Some of the others, while still officially on the Superfund site list, have had wastes and polluted soil removed. Wells that monitor contamination in groundwater are the only sign that they are Superfund sites. Many cleaned-up areas sport new development, such as the golf driving range built on part of a former Superfund site in Baltimore. Cleanup activities are completed at more than 800 Superfund sites, and work is under way at nearly 400 more.

As of Sept. 4, there were 1,079 Superfund sites that are not federal facilities, and 56 more are proposed for Superfund status. EPA has deleted 248 places from its list of nonfederal Superfund sites.

The Superfund list of contaminated commercial sites used to consist primarily of former industrial sites and dumps. But now that roll includes many locales that are old mines or that are waterways with contaminated sediments. These types of sites are often larger, more complicated, and more expensive to clean up than are the old-style open dumps filled with leaking barrels. These so-called megasites put even greater pressure on already tight Superfund monies.

Under Superfund, EPA takes two types of actions. One sort, called a removal, addresses emergencies such as spills or other contamination that threatens public health or the environment. For example, EPA may order that leaking drums be taken from the site and disposed of in accordance with current environmental standards. A second type of agency response, called remedial action, involves long-term, permanent cleanups, such as pumping and treating polluted groundwater. EPA uses federal money to pay for cleanup of contamination where the companies that generated the pollution cannot be found, can't afford to pay, or won't act. The agency also uses Superfund dollars to pay for emergency cleanups, then sues companies responsible for the contamination to recover its costs.

TO HELP BANKROLL EPA's cleanup activities, Congress levied taxes on chemical feedstocks and crude oil and established a corporate environmental tax. Those three levies, collectively called the Superfund tax, generated approximately $1.5 billion in revenues per year until they expired in 1995. The tax account's balance, which was at $3.6 billion in 1995, has declined steadily ever since: When fiscal 2003 begins on Oct. 1, it will hold an estimated $365 million, according to EPA's Office of Emergency Response. The remaining money is expected to be gone by the end of 2003.

The crux of the debate is whether Superfund should be funded solely from general tax revenues. Some argue that if Congress provides a steady appropriation to Superfund activities every year, it doesn't matter whether any money came from a special Superfund tax. Others say having a dedicated source of dollars from a Superfund tax is highly important as overall federal spending tightens.

Marianne L. Horinko, EPA assistant administrator for solid waste and emergency response, points out that the money remaining in the special tax account does not determine the agency's annual budget for Superfund spending. That job falls to Congress, Horinko, EPA's top Superfund manager, said at a July 31 Senate hearing.

Sen. Barbara Boxer (D-Calif.), who chairs the Senate Environment & Public Works Subcommittee on Superfund, Toxics, Risk & Waste Management, called the hearing at which Horinko testified. Though Superfund spending remained level when the tax account had money in it, Boxer said she wonders whether this will continue when the fund is empty.

"If the Superfund program is going down the tubes, be straight enough with us to tell us," Boxer told Horinko.

Many in Congress are increasingly worried that Superfund sites in the areas they represent won't get cleaned up because of the soon-to-be empty trust fund.

Sen. Robert G. Toricelli (D-N.J.), whose state has the greatest number of Superfund sites in the nation--111--said at the hearing, "Here's my analysis of the Superfund. It's no longer super, and it isn't much of a fund." He explained, "If this is only being paid by the American taxpayers, it isn't super. And a fund that has dwindled from over $3 billion isn't a fund.

"We have stopped a success," he said. Now individual taxpayers are "paying the obligations of corporations that have escaped their obligations," Toricelli added. "It is not right, and it is not fair."

Toricelli, who is a cosponsor of a Senate bill (S. 2596) to reinstate the Superfund taxes, said: "I've never had a single company complain to me that they were paying this fee. Not one. This isn't coming from the corporations," he said. He blamed the Bush Administration's strong stance against raising federal taxes of any kind, while noting that Presidents Ronald Reagan, George H. W. Bush, and Bill Clinton all supported the Superfund levy.

The U.S. Public Interest Research Group (PIRG) and several environmental groups cast the issue as one of equity. "The Bush Administration is making taxpayers pay more and asking polluters to pay less," PIRG says.

BUT CARTER (Kerry) L. Kelly, head of the American Chemistry Council's waste issues team, says Superfund remains a polluter-pays program even without the taxes because so much cleanup is funded by industry. Companies have paid for 70% of cleanup at Superfund sites, EPA figures show.

Chemical manufacturers paid excise taxes on feedstocks for 15 years and paid the corporate environmental levy as well, Kelly says. Plus, they shelled out for cleaning up Superfund sites at which they were potentially responsible for the presence of pollutants, she says.

Often, corporations that sent waste to a landfill must shoulder a cleanup burden greater than the amount of contamination they contributed, she says. For instance, Kelly says, local officials decades ago required some chemical makers to dispose of their wastes at unlined municipal landfills. Both hazardous waste and household trash are now mixed together in such sites. The amount of financial liability a municipality has to assume for a Superfund site has a cap, meaning companies have to pick up a greater share of the cleanup tab than is warranted by the amount of waste they contributed.

"They're left holding the bag," Kelly says.

Meanwhile, the Superfund program has expanded its mission in the past two decades, Kelly notes. In the beginning, old waste disposal sites such as Valley of the Drums and Love Canal were the norm. But now, Kelly says, the program addresses places such as New Bedford Harbor in Massachusetts, which has sediments heavily contaminated with polychlorinated biphenyls, and old mining sites with piles of tailings that may have been the source of contaminated runoff for a century. "These aren't the typical sites where you can finger polluters," she says.

It is unfair, Kelly continues, to expect a specific and narrow segment of commerce--the chemical and petroleum industries--to pay special excise taxes for Superfund activities. Plus, reinstating the excise and environmental levies would inflict hurt on an industry--chemical manufacturing--that has faced an economic downturn in recent years. Added to these financial concerns are the extra resources chemical producers are spending to augment plant security in the wake of the Sept. 11, 2001, terrorist attacks, she notes.

Society has benefited from the economic activities that created Superfund sites, and therefore, society at large, through general tax revenues, should pay for cleanup, Kelly argues.

Environmental groups are concerned that an empty tax account will emasculate EPA's efforts to get companies to clean up sites on their own. "If EPA cannot pay for a cleanup, the agency cannot file suit to get the polluter to pay," PIRG claims. Ed Hopkins, director of the Sierra Club's environmental quality program, says the agency now can depend on the Superfund trust fund as a sort of insurance that it will be able to pay for an emergency cleanup--then seek cost recovery from those companies or others responsible for the contamination. This is often more expensive than if a business or a coalition of companies does the work itself. The mere specter of EPA's taking over a cleanup often motivates companies to agree with EPA on a remediation plan and get the cleanup under way, Hopkins says.

Ross of EPA points out that the agency cannot spend dollars in the Superfund tax account at will. Congress must appropriate the money before EPA can use the funds.

But Hopkins says without the trust fund dollars that allow EPA to make good on threats that it will proceed with cleanups when discussions with companies falter, "polluters are going to stall." He wonders if the current standard of 70% of cleanups being conducted by the private sector will continue if the trust fund's balance falls to zero.

Hopkins says people who live near any Superfund site that doesn't receive cleanup funds because of a tighter federal budget will put pressure on those representing them in Congress to reinstate the Superfund tax. He adds, "I don't think this issue will go away."

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