Cleaning up Superfund

Public Interest, Summer, 1996 by W. Kip Viscusi, James T. Hamilton

The cleanup of hazardous wastes is the number one environmental concern of the American people. The government's response: the Environmental Protection Agency (EPA) launched its Superfund program, which was established by Congress in 1980 and reformed in 1986.

But, though not even two decades old, the Superfund effort is now a major target of Congress in its regulatory reform efforts. There are two main sources of dissatisfaction. First, cleanups of hazardous wastes are expensive, averaging $25.7 million per site. Superfund expenditures increased from under $400 million in 1985 to over $1.4 billion in 1995 and continue to be above the $1 billion mark even after recent budgetary cutbacks. Estimates of the total cleanup costs incurred since the program's inception range from $20 billion to $30 billion, about half of which has been borne by private parties. Second, there is a general sense that these cleanup expenditures have not delivered much reduction in risk. Are we devoting our resources to eliminating truly substantial hazards or does Superfund squander society's resources on trivial risks?

Three reform principles

In his 1993 book Breaking the Vicious Circle, Stephen Breyer, a Clinton appointee to the U.S. Supreme Court, recounted how cleanup efforts, by design, achieve very little:

Let me provide some examples. The first comes from a case in my own court, United States v. Ottati & Goss, arising out of a ten-year effort to force cleanup of a toxic waste dump in southern New Hampshire. The site was mostly cleaned up. All but one of the private parties had settled. The remaining private party litigated the cost of cleaning up the last little bit, a cost of about $9.3 million to remove a small amount of highly diluted PCBs and "volatile organic compounds" (benzene and gasoline components) by incinerating the dirt. How much extra safety did this $9.3 million buy? The forty-thousand-page record of this ten-year effort indicated (and all the parties seemed to agree) that, without the extra expenditure, the waste dump was clean enough for children playing on the site to eat small amounts of dirt daily for 70 days each year without significant harm. Burning the soil would have made it clean enough for the children to eat small amounts daily for 245 days per year without significant harm. But there were no dirt-eating children playing in the area, for it was a swamp. Nor were dirt-eating children likely to appear there, for future building seemed unlikely. The parties also agreed that at least half of the volatile organic chemicals would likely evaporate by the year 2000. To spend $9.3 million to protect non-existent dirt-eating children is what I mean by the problem of "the last 10 percent."

Such misallocation is commonplace. Indeed, elements present in Breyer's example are embedded in the entire EPA approach. In answering the question - how clean is clean? - EPA should follow three principles: assess risks accurately, determine the extent of the population exposed to the risk, and strive for an appropriate balance between benefits and costs.

Although these principles may seem obvious and unobjectionable, none of the three is reflected in the current approach. Establishing them is essential even if financial reforms to relieve some firms of liability are implemented. For relieving some private parties of Superfund costs does not eliminate the need for targeting public expenditures wisely. Moreover, a sensible targeting of resources will also eliminate needless cost expenditures and produce more immediate and real risk reductions than the current effort.

Assess risks accurately

EPA does not target its cleanup efforts randomly.(1) Each hazardous waste site is subjected to a comprehensive assessment of the risks and cleanup costs, which is then used to select which sites to clean up and what actions to take.

To understand the reasons for the current policy performance, it is helpful to review current risk-assessment practices. A primary impetus for hazardous waste cleanups is the potential cancer risk from chemical exposures. For the different mechanisms of exposure, EPA assesses the potential risk that would be present if a person was exposed to the chemical. This individual risk probability is a principal policy trigger for cleanup actions.

The assessed individual cancer risk is the risk that an individual would experience over a lifetime from 30 years of exposure. If the cancer risk is greater than [10.sup.-4], then the site must be cleaned up; if the risk is between [10.sup.-4] and [10.sup.-6], then cleanup is at the discretion of regional officials; and if the estimated risk is less than [10.sup.-6], cleanup is not generally warranted, though this prohibition can be overridden.

This numerical precision of estimated cancer risks, replete with multiple digits of zeros to capture fine gradations of risk, is, however, misleading; for the EPA does not, in fact, assess the real risks associated with Superfund sites. Rather, the analyses focus on worst-case outcomes. In assessing the risks from ground-water contamination, for example, the agency often uses upper bound, or 95th percentile, values for several different components of its risk calculation - the ingestion rate for ground water, the frequency of exposure to contaminated ground water, the duration of such exposure, the concentration of hazardous chemicals, and the potential toxicity of these chemicals. For each of these parameters, a conservative estimate is used, usually one that will occur 5 percent or less of the time.