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Home My WebLink About1999-02-22 99-95 RESOLVECOUNCIL Item No 99-95 Date: 02/22/99 Item/Subject: RESOLVE, Malting an Appropriation from the General Fund's Reserve for SeM Insurance to Fund the General Fund's Portion of the Casae Associatetl with the Portland - Bangor Waste Oil Company, Wells, Maine Site Responsible Department: City Manager The attached Resolve will appropriate the necessary funs for the general Wnd's portion of the cost of environmental remediation of the Portland-Bargo Waste Oil Company site In Wells, Maine. The City, through a sneering committee composed of representatives of various potentially responsible parties, has been working with the State Department of Environmental Protection since 1995 toward this settlement. Nona Neumann of the City Solicitor's Office has been our representative. Attachetl you will find a memo from Norm which summarizes the proporetl setlfement This settlement has been discussed with the Council on several occasions throughout the negotiating process. We belleve that this is a reasonable approach towand banging this situation to a conclusion A separate Order ratifying this setHement will appear on a future agenda. I recommend your approval of this action. cepartment Head Manager's Commands: City Manager Assodated IIHPrmatmn: Bloomer Memo Butlget Approval: 4155;637 TI�rn I France Director �fJCity !iolicitor Passage First Reading & Refer W Failures Committee 3-1.99 Page Referral 99-95 Assigned Co Councilor Crowley February 22, 1999 CITY OF BANGOR RE X1.PW, 7747.` the amount of $26,419.88 Is hereby appropriated from the General Fund's Reserve for Self -Insurance to an account to be established by the Finance DlrecbDr in order to fund the General Fund's portion of the costs assodated with the Portland-azrgor Waste 011 Company, Wells, Maine site. I9 CITY CKMMIL February 22. 1999 First Eradiug eeferrred to Haaace fo®ittee ITY IA CITY MEMIL E rch 10. 1999 Eor1w for Passage Earle earl Seconded Passed 99-95 RESOLVE Tile M ug m Appropriation from the General Fund's Eecerve for Self Insurance o Food the General Rind's Portion 0£ the Coes Asaocalth [he Ysx[ got I' Raece 011 M 1 a�pry� a^(,4- W~�' 99-95 MEMORANDUM To: Bangor City Council From: Norman S. Hchmam ID, Asst City Solicitor Re: DEP Cleanup Action / Portland- Bangor Waste Oil Company, Wells, Maine Site Date'. February 17, 1999 A most of you know, several years no the City was named as a Potentially Responsible Party (PRP) at the Portland -Bangor Waste Oil Site in Wells, Maine. Banger was identified as a party that that sent waste, primarily waste oil, to this site while it was in operation. its years ofopemtion were from the 1950's through 1980. Under the law, liability for cleamrp ofthe site is "joint and several". Also the law provides for strict liability. Negligence or wrongdoing by a PRP is not an issue. In fad disposing ofwaste with M. West's company during the time that it was in operation was legal and the accepted way of doing things. It was common practice to use waste haulms such as Mr. West and the PRP fist includes such entities as the Maine Department of Transportation and the Department of Defense. A steering wnunittm was formM in December 1995. I was a memberofthe committee. The purpose of the steering committee was to negotiate with the DEP and attempt to reach a settlement that was financially feasible. The steering committee found a company, TRC, Inc., that takes over the responsibilities, including liability costs, for a contaminated site's closure and retardation. TRC is a rational engineering firm specializing in air and send waste pollution prevention, control and remediation services. Negotiations then included participation by TRC. In October 1997 the Council authorized the execution of Joint Defense Agreement with other PRFs (Coined Order 97 431). Eighty-five (85) cd a PRPs signed the Joint Defense Agreement In addition wallowing the steering committer to present a more unified front to the DEP, the Joint Defense Group hired an engineering firm, Woodward & Curren, to assist it in assessing the site, work done by the DEP and remediation alternatives. A settlement has been reached, subject to the approval of the PRFs. The settlement includes the transfer site of site cleanup liabilities to TRC, Inc. This, of course, comes at a cod to the PRPs. The City's share will be $42,028.68. Because the airport contributed to the site it will pay some of the cost Also, the $1,500 that the City paid at the time the Joint Defense Agreement was signed will be credited to the City's obligation. The anpon's sharewillbe $14,098 80. The City's share will be $26,449.86. The number was determined by setting a settlement payment amount of $5.77 per gallon for all PRFs that contributed 1,000 gallons or mare to the site. There is an incentive (discount) to pay 99-95 by April 20, 1999 as the amount due will increase after that daze. After April 20, 1999 the airport's share will be $16,226.00 and the City's share will be $32,212 60. The settlement requires that the parties sign a Consort Decree. This will provide release for all liability for the settling PRP. There will be a covenant not to sue by the Stele. Any rights of contribution a PRP has will be assigned to TRC. TRC will pay the State's past was at the site in the me= of$850,000. TRC will complete the remediation at the site. There will be no admission of liability. Although the State has not filed suit, the Consent Decree will have to be approved by the Paleral Court Therefore, at the appropriate time a complaint will be filed and the Consent Decree preserved to the Court and PRP -defendants, including the City. The remediation is expected to consist of two more years of work and up to thirty seem of monitoring at the site. TRC will execute a Performance Bond to guarantee compliance with the agreement. There will also be a Site Responsibility and Indemnity Agreement between the PRPs and TAC. Environmental compliance liability for the site will be transfersad to TRC. Under this Agreement TRC will indemnify the PRPs against possible Poture environmental costs. TAC will also indemnify the PRPs against claims of third parties (other than bodily injury). The settlement also provides for instance policies to be purchased. The first a Cleanup Cost Cap / Finite Policy, will insure compliance with the terms of the settlement. It will have a$30 million policy limit and a term of 32 years. The second, a Pollution Legal Liability Policy, will provide third party liability art coverage. It will have a $15 million limit with a term of 10 years. This policy will have a$100,000 deductible that TRC would pay if there were a claim. Coverage will be titillative to January 1, 1950. Finally, there will be an Escrow Agreement Ar escrow account was openedm December 23, 1998 and already PRPs have deposited $800,000 into it. The escrow agent is State Street Bank in Boston. It will remain open for nine months m collect the PRP Payments. This returned with interest. Iffor arty reason there lam eedement the PRFs payment will be reurved with ivmresr. TRC bas the right to reject the agreement if minimum threshold amount is not me. TRC has the right to waive the threshold and proceed with the agreement. These documents are confidential settlement papers pending their submission to the U. S. District Court for approval. The steering committee needs to have the participation of as may PRFs as passible agree in order to meet the $14 trillion threshold. Virtually all of the PRFs attending a meeting on January 19, 1999 agreed. However, there was a good number that did not attend the meeting. These PRFs will need to be counseled. 99-95 The purpose of this memo is to update the Council. We will discuss this further in an executive session prior a Council meeting. At some point there will be Council Orders to authorize the execution of the documents and payment of the settlement amount. If any of you have any questions in the meart ime, please call. N51 H pc: Edward A. Barrett, City Manager F'k SNmpfed City Solicitor