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United States v. Northern States Power Co.

United States District Court, W.D. Wisconsin

September 30, 2010

UNITED STATES OF AMERICA and STATE OF WISCONSIN, Plaintiffs,
v.
NORTHERN STATES POWER COMPANY, Defendant. Lead No. 12-cv-565-bbc Period of Noncompliance Penalty Per Violation Per Day

          CONSENT DECREE BETWEEN THE UNITED STATES, WISCONSIN, AND NORTHERN STATES POWER COMPANY

         TABLE OF CONTENTS

         I. BACKGROUND ........................................................................................................................ 1

         II. JURISDICTION ......................................................................................................................... 3

         III. PARTIES BOUND ..................................................................................................................... 3

         IV. DEFINITIONS ............................................................................................................................ 4

         V. GENERAL PROVISIONS ......................................................................................................... 8

         VI. PERFORMANCE OF THE WORK ........................................................................................... 9

         VII. REMEDY REVIEW ................................................................................................................. 11

         VIII. ACCESS AND INSTITUTIONAL CONTROLS .................................................................... 12

         IX. FINANCIAL ASSURANCE .................................................................................................... 15

         X. PAYMENTS FOR RESPONSE COSTS .................................................................................. 19

         XI. DISBURSEMENT OF SPECIAL ACCOUNT FUNDS .......................................................... 21

         XII. INDEMNIFICATION AND INSURANCE ............................................................................. 25

         XIII. FORCE MAJEURE .................................................................................................................. 26

         XIV. DISPUTE RESOLUTION ........................................................................................................ 28

         XV. STIPULATED PENALTIES .................................................................................................... 30

         XVI. COVENANTS BY PLAINTIFFS ............................................................................................. 33

         XVII. COVENANTS BY SETTLING DEFENDANT ....................................................................... 36

         XVIII. EFFECT OF SETTLEMENT; CONTRIBUTION ................................................................... 38

         XIX. ACCESS TO INFORMATION ................................................................................................ 40

         XX. RETENTION OF RECORDS ................................................................................................... 41

         XXI. NOTICES AND SUBMISSIONS ............................................................................................. 41

         XXII. RETENTION OF JURISDICTION .......................................................................................... 43

         XXIII. APPENDICES .......................................................................................................................... 44

         XXIV. MODIFICATION ..................................................................................................................... 44

         XXV. LODGING AND OPPORTUNITY FOR PUBLIC COMMENT ............................................. 44

         XXVI. SIGNATORIES/SERVICE ....................................................................................................... 45

         XXVII. FINAL JUDGMENT ................................................................................................................ 45

         I. BACKGROUND

         A. The United States of America (“United States”), on behalf of the Administrator of the United States Environmental Protection Agency (“EPA”), and the State of Wisconsin (the “State”), at the request of the Governor of Wisconsin on behalf of the Wisconsin Department of Natural Resources (“WDNR”), filed a complaint in this matter pursuant to Sections 106 and 107 of the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. §§ 9606 and 9607.

         B. The United States and the State in the complaint seek, inter alia: (1) reimbursement of costs incurred by EPA and the U.S. Department of Justice (“DOJ”) for response actions at the Ashland/Northern States Power Lakefront Superfund Site in Ashland, Wisconsin (“Site”), together with accrued interest; and (2) performance of response actions by Northern States Power Company, a Wisconsin Corporation (“Settling Defendant”) at the Site consistent with the National Contingency Plan, 40 C.F.R. Part 300 (“NCP”).

         C. In accordance with the NCP and Section 121(f)(1)(F) of CERCLA, 42 U.S.C. § 9621(f)(1)(F), EPA notified the State of negotiations with potentially responsible parties (“PRPs”) regarding the implementation of the remedial design and remedial action (“RD/RA”) for the Site, and the States has participated in such negotiations and elected to be a party to this Consent Decree (“Consent Decree”).

         D. By signing this Consent Decree, Settling Defendant does not admit any liability to Plaintiffs arising out of the transactions or occurrences alleged in the complaint, nor does it acknowledge that the release or threatened release of hazardous substances at or from the Site constitutes an imminent and substantial endangerment to the public health or welfare or the environment.

         E. Settling Defendant brought suit for matters related to this Consent Decree in the case titled Northern States Power Company v. City of Ashland, Wisconsin, et. al., No. 12-cv-602 (W.D. Wisc.). The decision is available at Northern States Power Company v. City of Ashland, 131 F.Supp.3d 802 (W.D. Wis. 2015).

         F. Pursuant to Section 105 of CERCLA, 42 U.S.C. § 9605, EPA placed the Site on the National Priorities List (NPL), set forth at 40 C.F.R. Part 300, Appendix B, by publication in the Federal Register on September 5, 2002, 67 Fed. Reg. 56, 757-56, 765.

         G. In response to a release or a substantial threat of a release of a hazardous substance(s) at or from the Site, EPA and Settling Defendant commenced on November 14, 2003, a Remedial Investigation and Feasibility Study (“RI/FS”) for the Site pursuant to 40 C.F.R. § 300.430. Settling Defendant completed a Remedial Investigation (“RI”) Report on February 5, 2008, and completed a Feasibility Study (“FS”) Report on December 4, 2008.

         H. Pursuant to Section 117 of CERCLA, 42 U.S.C. § 9617, EPA published notice of the completion of the FS and of the proposed plan for remedial action on June 1, 2009, in a major local newspaper of general circulation. EPA provided an opportunity for written and oral comments from the public on the proposed plan for remedial action. A copy of the transcript of the public meeting is available to the public as part of the administrative record upon which the Director of the Superfund Division, EPA Region 5, based the selection of the response action.

         I. The decision by EPA on the remedial action to be implemented at the Site is embodied in a final Record of Decision (“ROD”), executed on September 30, 2010, on which the State has given its concurrence. The ROD includes EPA's explanation for any significant differences between the final plan and the proposed plan as well as a responsiveness summary to the public comments. Notice of the final plan was published in accordance with Section 117(b) of CERCLA, 42 U.S.C. § 9617(b).

         J. The Site includes four inter-related areas of concern: 1) sediments in Chequamegon Bay; 2) soil and shallow groundwater in Kreher Park; 3) soil and shallow groundwater in the Upper Bluff/Filled Ravine; and 4) deep groundwater in the Copper Falls Aquifer. This Consent Decree addresses the remedial design and remedial action for the sediments in the Chequamegon Bay portion of the Site (“Phase 2 Project Area”). Settling Defendant is already performing the remedy selected in the ROD for the soil and groundwater portions of the Site (items 2-4, above) under the terms of a consent decree entered on October 19, 2012 in the case United States v. Northern States Power Co., No. 12-cv-00565 (“Phase 1 Consent Decree”). The Phase 1 Consent Decree also resolved claims for Natural Resource Damages as to Settling Defendant and Settling Defendant's Related Parties for the entire Site, including the portion of Chequamegon Bay within the Site, as set forth in the Phase 1 Consent Decree. The parties anticipate that this Consent Decree will be the final Consent Decree for the Site as to Settling Defendant, and that this Consent Decree will resolve Settling Defendant's liability at the Site except as set forth in Section XVIII.

         K. The ROD selected a combination of dry excavation and wet dredging (called option SED-6 in the ROD) as the sediment remedy for the Phase 2 Project Area. The ROD also provided the option of remediating all of the contaminated sediments within the Phase 2 Project Area boundaries using wet dredging, if the results of a wet dredge pilot study (“Pilot Study”) demonstrate that a wet dredge remedy can meet performance standards and be successfully performed in the near-shore area.

         L. On July 15, 2015, EPA and Settling Defendant entered into an Administrative Settlement Agreement and Order on Consent for Construction of Breakwater (“Breakwater AOC”) to construct a breakwater to provide wave attenuation and containment for the portion of the Site where dredge activities will take place during the Pilot Study and full-scale dredge. Construction of the breakwater was completed in late 2015.

         M. In the summer of 2016, Settling Defendant conducted the Pilot Study and demonstrated that wet dredging can be used to successfully remediate the near-shore sediment at the Phase 2 Project Area. In accordance with the ROD, EPA published an Explanation of Significant Differences (“ESD”) dated December 2016, determining that wet dredging, instead of dry excavation, may be performed for the near-shore sediments, as further described in the Statement of Work and the approved Remedial Design Work Plan.

         N. Solely for the purposes of Section 113(j) of CERCLA, 42 U.S.C. § 9613(j), the remedy set forth in the ROD and the Work to be performed by Settling Defendant shall constitute a response action taken or ordered by the President for which judicial review shall be limited to the administrative record.

         O. The Parties recognize, and the Court by entering this Consent Decree finds, that this Consent Decree has been negotiated by the Parties in good faith and implementation of this Consent Decree will expedite the cleanup of the Site and will avoid prolonged and complicated litigation between the Parties, and that this Consent Decree is fair, reasonable, and in the public interest.

         NOW, THEREFORE, it is hereby Ordered, Adjudged, and Decreed:

         II. JURISDICTION

         1. This Court has jurisdiction over the subject matter of this action pursuant to 28 U.S.C. §§ 1331 and 1345, and 42 U.S.C. §§ 9606, 9607, and 9613(b). This Court also has personal jurisdiction over Settling Defendant. Solely for the purposes of this Consent Decree and the underlying complaint, Settling Defendant waives all objections and defenses that it may have to jurisdiction of the Court or to venue in this District. Settling Defendant shall not challenge the terms of this Consent Decree or this Court's jurisdiction to enter and enforce this Consent Decree.

         III. PARTIES BOUND

         2. This Consent Decree is binding upon the United States and the State and upon Settling Defendant and its successors and assigns. Any change in ownership or corporate or other legal status of a Settling Defendant including, but not limited to, any transfer of assets or real or personal property, shall in no way alter such Settling Defendant's responsibilities under this Consent Decree.

         3. Settling Defendant shall provide a copy of this Consent Decree to each contractor hired to perform the Work and to each person representing Settling Defendant with respect to the Site or the Work, and shall condition all contracts entered into hereunder upon performance of the Work in conformity with the terms of this Consent Decree. Settling Defendant or its contractors shall provide written notice of the Consent Decree to all subcontractors hired to perform any portion of the Work. Settling Defendant shall nonetheless be responsible for ensuring that its contractors and subcontractors perform the Work in accordance with the terms of this Consent Decree. With regard to the activities undertaken pursuant to this Consent Decree, each contractor and subcontractor shall be deemed to be in a contractual relationship with Settling Defendant within the meaning of Section 107(b)(3) of CERCLA, 42 U.S.C. § 9607(b)(3).

         IV. DEFINITIONS

         4. Unless otherwise expressly provided in this Consent Decree, terms used in this Consent Decree that are defined in CERCLA or in regulations promulgated under CERCLA shall have the meaning assigned to them in CERCLA or in such regulations. Whenever terms listed below are used in this Consent Decree or its appendices, the following definitions shall apply solely for purposes of this Consent Decree:

         “Affected Property” shall mean all real property at the Site and any other real property where EPA determines, at any time, that access, land, water, or other resource use restrictions, and/or ICs are needed to implement the Remedial Action.

         “Ashland/Northern States Power Special Account” shall mean the special account, within the EPA Hazardous Substances Superfund, established for the Site (Site ID B5 N5) by EPA pursuant to Section 122(b)(3) of CERCLA, 42 U.S.C. § 9622(b)(3).

         “Ashland/Northern States Power Disbursement Special Account” shall mean the special account, within the EPA Hazardous Substance Superfund, established for the Site by EPA pursuant to Section 122(b)(3) of CERCLA, 42 U.S.C. § 9622(b)(3), and ¶ 39 (Creation of Ashland/Northern States Power Disbursement Special Account).

         “CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. §§ 9601-9675.

         “Consent Decree” shall mean this Consent Decree and all appendices attached hereto (listed in Section XXIII). In the event of conflict between this Consent Decree and any appendix, this Consent Decree shall control.

         “Day” or “day” shall mean a calendar day. In computing any period of time under this Consent Decree, where the last day would fall on a Saturday, Sunday, or federal or State holiday, the period shall run until the close of business of the next working day.

         “DOJ” shall mean the United States Department of Justice and its successor departments, agencies, or instrumentalities.

         “Effective Date” shall mean the date upon which the approval of this Consent Decree is recorded on the Court's docket.

         “EPA” shall mean the United States Environmental Protection Agency and its successor departments, agencies, or instrumentalities.

         “EPA Hazardous Substance Superfund” shall mean the Hazardous Substance Superfund established by the Internal Revenue Code, 26 U.S.C. § 9507.

         “Future Response Costs” shall mean all costs, including, but not limited to, direct and indirect costs, that the United States incurs in reviewing or developing deliverables submitted pursuant to this Consent Decree, in overseeing implementation of the Work, or otherwise implementing, overseeing, or enforcing this Consent Decree, including, but not limited to, payroll costs, contractor costs, travel costs, laboratory costs, the costs incurred pursuant to ¶ 11 (Emergencies and Releases), ¶ 12 (Community Involvement) (including the costs of any technical assistance grant under Section 117(e) of CERCLA, 42 U.S.C. § 9617(e)), ¶ 31 (Access to Financial Assurance), Section VII (Remedy Review), Section VIII (Access and Institutional Controls) (including the cost of attorney time and any monies paid to secure access and/or to secure, implement, monitor, maintain, or enforce Institutional Controls including the amount of just compensation), Section XIV (Dispute Resolution), WDNR costs billed to EPA by agreement between WDNR and EPA, and all litigation costs. Future Response Costs shall also include all Interim Response Costs, and all Interest on those Past Response Costs Settling Defendant has agreed to pay under this Consent Decree that has accrued pursuant to 42 U.S.C. § 9607(a) during the period from October 31, 2015, to the Effective Date.

         “Institutional Controls” or “ICs” shall mean restrictions, limitations, or other conditions or action taken under state laws or local laws, regulations, ordinances, zoning restrictions, or other governmental controls or notices to ensure that conditions at the Phase 2 Project Area, and the rest of the Site to the extent described in Section VIII, remain protective of public health, safety, and welfare and the environment, including, but not limited, to Wis.Stat. § 292.12, that may also: (a) limit land, water, and/or resource use to minimize the potential for human exposure to Waste Material at the Site; (b) limit land, water, and/or resource use to implement, ensure noninterference with, or ensure the protectiveness of the Phase 2 Remedial Action; (c) provide information intended to modify or guide human behavior at the Phase 2 Project Area, and the rest of the Site to the extent described in Section VIII; and/or (d) require easements or covenants running with the land that (i) limit land, water, or resource use and/or provide access rights and (ii) are created pursuant to common law or statutory law by an instrument that is recorded by the owner in the appropriate land records office (which has commonly been referred to as “Proprietary Controls” by EPA).

         “Institutional Control Implementation and Assurance Plan” or “ICIAP” shall mean the plan for implementing, maintaining, monitoring, and reporting on the Institutional Controls set forth in the ROD, prepared in accordance with the statement of work (“SOW”).

         “Interest” shall mean interest at the rate specified for interest on investments of the EPA Hazardous Substance Superfund, compounded annually on October 1 of each year, in accordance with 42 U.S.C. § 9607(a). The applicable rate of interest shall be the rate in effect at the time the interest accrues. The rate of interest is subject to change on October 1 of each year. Rates are available online at http://www2.epa.gov/superfund/superfund-interest-rates.

         “Interim Response Costs” shall mean all costs, including, but not limited to, direct and indirect costs, (a) paid by the United States in connection with the Site between October 31, 2015, and the Effective Date, or (b) incurred prior to the Effective Date but paid after that date.

         “National Contingency Plan” or “NCP” shall mean the National Oil and Hazardous Substances Pollution Contingency Plan promulgated pursuant to Section 105 of CERCLA, 42 U.S.C. § 9605, codified at 40 C.F.R. Part 300, and any amendments thereto.

         “Operation and Maintenance” or “O&M” shall mean all activities required to operate, maintain, and monitor the effectiveness of the Phase 2 Remedial Action as required under the Operation and Maintenance Plan approved or developed by EPA pursuant to the SOW, and maintenance, monitoring, and enforcement of Institutional Controls as provided in the ICIAP.

         “Paragraph” or “¶” shall mean a portion of this Consent Decree identified by an Arabic numeral or an upper or lower case letter.

         “Parties” shall mean the United States, the State of Wisconsin, and Settling Defendant.

         “Past Response Costs” shall mean all costs, including, but not limited to, direct and indirect costs, that the United States paid at or in connection with the Site through October 31, 2015, plus Interest on all such costs that has accrued pursuant to 42 U.S.C. § 9607(a) through such date.

         “Phase 1 Consent Decree” shall mean the consent decree entered on October 19, 2012 in the case United States v. Northern States Power Co., No. 12-cv-00565.

         “Phase 1 Project Area” shall mean that area of the Site generally comprising Kreher Park; the Upper Bluff/Filled Ravine; and the Copper Falls Aquifer. The Phase 1 Project Area comprises the entire Site except for the portion of Chequamegon Bay within the Site boundary.

         “Phase 2 Performance Standards” shall mean the cleanup standards for sediments in the Phase 2 Remedial Action, as set forth in the ROD, the ESD, the SOW, and the design plans and specifications developed and approved by EPA in accordance with the SOW. The Phase 2 Performance Standards for sediments shall be established to achieve: (i) the Remedial Action Objectives (“RAOs”) described in Section 8.0 of the ROD; (ii) the performance standards for selected sediment remedy described in Section 12.3 of the ROD or described in the ESD; and (iii) any ARARs identified in Appendix C of the ROD and that are identified during the Phase 2 Remedial Design.

         “Phase 2 Project Area” shall mean that area of the Site located in Chequamegon Bay, and depicted in Appendix A.

         “Phase 2 Remedial Action” shall mean the remedial action selected for the sediments in Chequamegon Bay by the EPA in accordance with the ROD.

         “Phase 2 Remedial Design” shall mean those activities necessary to develop final plans and specifications for the Phase 2 Remedial Action as stated in the SOW.

         “Plaintiffs” shall mean the United States and the State of Wisconsin.

         “RCRA” shall mean the Solid Waste Disposal Act, 42 U.S.C. §§ 6901-6992 (also known as the Resource Conservation and Recovery Act).

         “Record of Decision” or “ROD” shall mean the EPA Record of Decision relating to the Site Dated: September 30, 2010, by the Director of the Superfund Division, EPA Region 5, and all attachments thereto. The ROD was filed with the Court in United States v. Northern States Power Co., No. 12-cv-00565 (W.D. Wisc.), Doc. No. 2, and is available on the EPA website at http://dnr.wi.gov/topic/brownfields/Ashland.html.

         “Section” shall mean a portion of this Consent Decree identified by a Roman numeral.

         “Settling Defendant” shall mean Northern States Power Company, a Wisconsin corporation.

         “Settling Defendant's Related Parties” shall mean: (i) all parents, subsidiaries, and affiliates of Settling Defendant (including, but not limited to, Xcel Energy, Inc., a Minnesota corporation; Xcel Energy Services, Inc., a Delaware corporation; Northern States Power Company, a Minnesota corporation; Southwestern Public Service Company, a New Mexico corporation; and Public Service Company of Colorado, a Colorado corporation), but only to the extent that the alleged liability of such person is based on the alleged liability of the Settling Defendant; and (ii) the former or current officers, directors, employees, general partners, limited partners, members, or shareholders of Settling Defendant and of any entity included in clause (i) of this Paragraph, but only to the extent that the alleged liability of such person is based on acts and/or omissions which occurred within the scope of the person's employment or capacity as an officer, director, employee, general partner, limited partner, member, or shareholder of the Settling Defendant or of any entity included in clause (i) of this Paragraph.

         “Site” shall mean the Ashland/Northern States Power Lakefront Site, located in Ashland, Ashland County, Wisconsin, and depicted generally on the map attached as Appendix A. The Site consists of both the Phase 2 Project Area and the Phase 1 Project Area.

         “State” shall mean the State of Wisconsin and each department, agency, and instrumentality of the State of Wisconsin, including WDNR.

         “Statement of Work” or “SOW” shall mean the document describing the activities Settling Defendant must perform to implement the Phase 2 Remedial Design and the Phase 2 Remedial Action regarding the Site. The SOW is attached hereto as Appendix B.

         “Supervising Contractor” shall mean the principal contractor retained by Settling Defendant to supervise and direct the implementation of the Work under this Consent Decree.

         “Transfer” shall mean to sell, assign, convey, lease, mortgage, or grant a security interest in, or where used as a noun, a sale, assignment, conveyance, or other disposition of any interest by operation of law or otherwise.

         “United States” shall mean the United States of America and each department, agency, and instrumentality of the United States, including EPA.

         “Waste Material” shall mean (1) any “hazardous substance” under Section 101(14) of CERCLA, 42 U.S.C. § 9601(14); (2) any pollutant or contaminant under Section 101(33) of CERCLA, 42 U.S.C. § 9601(33); (3) any “solid waste” under Section 1004(27) of RCRA, 42 U.S.C.§ 6903(27), or WIS. STAT. § 289.01(33); and (4) any “hazardous substance” under WIS. STAT. § 292.01(5).

         “WDNR” shall mean the Wisconsin Department of Natural Resources and its successor departments, agencies, or instrumentalities.

         “WDNR Database” shall mean the publicly accessible database available on the internet as required by WIS. STAT. §§ 292.12, 292.31, and 292.57. The WDNR Database is accessible at http://dnr.wi.gov/botw/SetUpBasicSearchForm.do.

         “Work” shall mean all activities and obligations Settling Defendant is required to perform under this Consent Decree, except the activities required under Section XX (Retention of Records) and as limited by Paragraph 85.

         V. GENERAL PROVISIONS

         5. Objectives of the Parties. The objectives of the Parties in entering into this Consent Decree are to protect public health or welfare or the environment by the design and implementation of response actions at the Phase 2 Project Area by Settling Defendant, to pay response costs incurred by Plaintiffs with respect to the Site, and to resolve the claims of Plaintiffs against Settling Defendant as provided in this Consent Decree.

         6. Commitments by Settling Defendant. Settling Defendant shall finance and perform the Work in accordance with this Consent Decree, the ROD, and all deliverables developed by Settling Defendant and approved or modified by EPA pursuant to this Consent Decree. Settling Defendant shall pay the United States for its response costs as provided in this Consent Decree.

         7. Compliance with Applicable Law. Nothing in this Consent Decree limits Settling Defendant's obligations to comply with the requirements of all applicable federal, state, and local laws and regulations. Settling Defendant must also comply with all applicable or relevant and appropriate requirements of all federal and state environmental laws as set forth in the ROD and the SOW. The activities conducted pursuant to this Consent Decree, if approved by EPA, shall be deemed to be consistent with the NCP as provided in Section 300.700(c)(3)(ii) of the NCP.

         8. Permits.

         a. As provided in Section 121(e) of CERCLA, 42 U.S.C. § 9621(e), and Section 300.400(e) of the NCP, no permit shall be required for any portion of the Work conducted entirely on-site (i.e., within the areal extent of contamination or in very close proximity to the contamination and necessary for implementation of the Work). Where any portion of the Work that is not on-site requires a federal or state permit or approval, Settling Defendant shall submit timely and complete applications and take all other actions necessary to obtain all such permits or approvals.

         b. Settling Defendant may seek relief under the provisions of Section XIII (Force Majeure) for any delay in the performance of the Work resulting from a failure to obtain, or a delay in obtaining, any permit or approval referenced in ¶ 8.a and required for the Work, provided that it has submitted timely and complete applications and taken all other actions necessary to obtain all such permits or approvals.

         c. This Consent Decree is not, and shall not be construed to be, a permit issued pursuant to any federal or state statute or regulation.

         VI. PERFORMANCE OF THE WORK

         9. Coordination and Supervision.

         a. Project Coordinators.

         (1) Settling Defendant's Project Coordinator must have sufficient technical expertise to coordinate the Work. Settling Defendant's Project Coordinator may not be an attorney representing Settling Defendant in this matter and may not act as the Supervising Contractor. Settling Defendant's Project Coordinator may assign other representatives, including other contractors, to assist in coordinating the Work.

         (2) EPA shall designate and notify the Settling Defendant of its Project Coordinator[s] and Alternate Project Coordinator[s]. EPA may designate other representatives, which may include its employees, contractors and/or consultants, to oversee the Work. EPA's Project Coordinator/Alternate Project Coordinator will have the same authority as a remedial project manager and/or an on-scene coordinator, as described in the NCP. This includes the authority to halt the Work and/or to conduct or direct any necessary response action when he or she determines that conditions at the Site constitute an emergency or may present an immediate threat to public health or welfare or the environment due to a release or threatened release of Waste Material.

         (3) The State shall designate and notify EPA and the Settling Defendant of its Project Coordinator[s] and Alternate Project Coordinator[s]. The State may designate other representatives, including its employees, contractors and/or consultants to oversee the Work. For any meetings and inspections in which EPA's Project Coordinator participates, the State's Project Coordinator also may participate. Settling Defendant shall notify the State reasonably in advance of any such meetings or inspections.

         (4) Settling Defendant's Project Coordinators shall meet with EPA's and the State's Project Coordinator[s] at least monthly.

         b. Supervising Contractor. Settling Defendant's proposed Supervising Contractor must have a quality assurance system that complies with ANSI/ASQC E4-2004, Quality Systems for Environmental Data and Technology Programs: Requirements with Guidance for Use (American National Standard).

         c. Procedures for Disapproval/Notice to Proceed.

         (1) Settling Defendant shall designate, and notify EPA, within 10 days after the Effective Date, of the names, contact information, and qualifications of the Settling Defendant's proposed Project Coordinator and Supervising Contractor.

         (2) EPA, after a reasonable opportunity for review and comment by the State, shall issue notices of disapproval and/or authorizations to proceed regarding the proposed Project Coordinator and Supervising Contractor, as applicable. If EPA issues a notice of disapproval, Settling Defendant shall, within 30 days, submit to EPA a list of supplemental proposed Project Coordinators and/or Supervising Contractors, as applicable, including a description of the qualifications of each. EPA shall issue a notice of disapproval or authorization to proceed regarding each supplemental proposed coordinator and/or contractor. Settling Defendant may select any coordinator/contractor covered by an authorization to proceed and shall, within 21 days, notify EPA of Settling Defendant's selection.

         (3) Settling Defendant may change its Project Coordinator and/or Supervising Contractor, as applicable, by following the procedures of ¶¶ 9.c(1)and 9.c(2).

         10. Performance of Work in Accordance with SOW. Settling Defendant shall: (a) develop the Phase 2 Remedial Design; (b) perform the Phase 2 Remedial Action; and (c) operate, maintain, and monitor the effectiveness of the Phase 2 Remedial Action; all in accordance with the SOW and all EPA-approved, conditionally-approved, or modified deliverables as required by the SOW. All deliverables required to be submitted for approval under the Consent Decree or SOW shall be subject to approval by EPA in accordance with ¶ 6.6 (Approval of Deliverables) of the SOW.

         11. Emergencies and Releases. Settling Defendant shall comply with the emergency and release response and reporting requirements under ¶ 4.3 (Emergency Response and Reporting) of the SOW. Subject to Section XVI (Covenants by Plaintiffs), nothing in this Consent Decree, including ¶ 4.3 of the SOW, limits any authority of Plaintiffs: (a) to take all appropriate action to protect human health and the environment or to prevent, abate, respond to, or minimize an actual or threatened release of Waste Material on, at, or from the Site, or (b) to direct or order such action, or seek an order from the Court, to protect human health and the environment or to prevent, abate, respond to, or minimize an actual or threatened release of Waste Material on, at, or from the Site. If, due to Settling Defendant's failure to take appropriate response action under ¶ 4.3 of the SOW, EPA or, as appropriate, the State takes such action instead, Settling Defendant shall reimburse EPA and the State under Section X (Payments for Response Costs) for all costs of the response action.

         12. Community Involvement. If requested by EPA or WDNR, Settling Defendant shall conduct community involvement activities under EPA's oversight as provided for in, and in accordance with, the SOW. Such activities may include, but are not limited to, designation of a Community Involvement Coordinator. Costs incurred by the United States under this Section constitute Future Response Costs to be reimbursed under Section X (Payments for Response Costs).

         13. Modification of SOW or Related Deliverables.

         a. If EPA, after consultation with WDNR, determines that it is necessary to modify the work specified in the SOW and/or in deliverables developed under the SOW in order to achieve and/or maintain the Phase 2 Performance Standards or to carry out and maintain the effectiveness of the Phase 2 Remedial Action, and such modification is consistent with the Scope of the Remedy set forth in ¶ 1.3 of the SOW then EPA may notify Settling Defendant of such modification. If Settling Defendant objects to the modification it may, within 30 days after EPA's notification, seek dispute resolution under Section XIV.

         b. The SOW and/or related work plans shall be modified: (1) in accordance with the modification issued by EPA; or (2) if Settling Defendant invokes dispute resolution, in accordance with the final resolution of the dispute. The modification shall be incorporated into and enforceable under this Consent Decree, and Settling Defendant shall implement all work required by such modification. Settling Defendant shall incorporate the modification into the deliverable required under the SOW, as appropriate.

         c. Nothing in this Paragraph shall be construed to limit EPA's authority to require performance of further response actions as otherwise provided in this Consent Decree.

         14. Nothing in this Consent Decree, the SOW, or any deliverable required under the SOW constitutes a warranty or representation of any kind by Plaintiffs that compliance with the work requirements set forth in the SOW or related deliverable will achieve the Phase 2 Performance Standards.

         VII. REMEDY REVIEW

         15. Periodic Review. Settling Defendant shall conduct, in accordance with ¶ 4.6 (Periodic Review Support Plan) of the SOW, studies and investigations to support EPA's reviews under Section 121(c) of CERCLA, 42 U.S.C. § 9621(c), and applicable regulations, of whether the Phase 2 Remedial Action is protective of human health and the environment, provided, however, that no five year remedy review shall be required under this Consent Decree in the event that the remedial action permits unlimited use and unrestricted exposure of the Phase 2 Project Area within the meaning of the NCP at Part 300.430(f)(4)(ii).

         16. EPA Selection of Further Response Actions. If EPA after consultation with WDNR, determines, at any time, that the Phase 2 Remedial Action is not protective of human health and the environment, EPA may select further response actions for the Site in accordance with the requirements of CERCLA and the NCP.

         17. Opportunity to Comment. Settling Defendant and, if required by Section 113(k)(2) or 117 of CERCLA, 42 U.S.C. § 9613(k)(2) or 9617, the public, will be provided with an opportunity to comment on any further response actions proposed by EPA as a result of the review conducted pursuant to Section 121(c) of CERCLA, 42 U.S.C. 9621(c), and to submit written comments for the record during the comment period.

         18. Settling Defendant's Obligation to Perform Further Response Actions. If EPA selects further response actions relating to the Site, EPA may require Settling Defendant to perform such further response actions, but only to the extent that the reopener conditions in ¶ 74 or 75 (United States' Pre- and Post-Certification Reservations) are satisfied. Settling Defendant may invoke the procedures set forth in Section XIV (Dispute Resolution) to dispute (a) EPA's determination that the reopener conditions of ¶ 74 or 75 are satisfied, (b) EPA's determination that the Phase 2 Remedial Action is not protective of human health and the environment, or (c) EPA's selection of the further response actions. Disputes regarding EPA's determination that the Phase 2 Remedial Action is not protective or EPA's selection of further response actions shall be resolved pursuant to ¶ 57 (Record Review).

         19. Submission of Plans. If Settling Defendant is required to perform further response actions pursuant to ¶ 18, it shall submit a plan for such response action to EPA for approval in accordance with the procedures of Section VI (Performance of the Work). Settling Defendant shall implement the approved plan in accordance with this Consent Decree.

         VIII. ACCESS AND INSTITUTIONAL CONTROLS

         20. The Parties acknowledge that Settling Defendant has executed access agreements with the City of Ashland and Wisconsin Central, Ltd. (the relevant portions of which are included in Appendix C), which currently satisfy Settling Defendant's obligations to obtain access to properties owned by or in the possession of the City of Ashland and Wisconsin Central, Ltd.

         21. Access and Institutional Controls. In the event that the City of Ashland and/or Wisconsin Central Ltd., revoke or otherwise limit the access provided by the already-executed agreements, or should additional access become necessary, Settling Defendant shall, with respect to any Non-Settling Owner's Affected Property use best efforts to secure from such Non-Settling Owner an agreement, enforceable by Settling Defendant and by Plaintiffs, providing that such Non-Settling Owner: (i) provide Plaintiffs and the Settling Defendant, and their representatives, contractors, and subcontractors with access at all reasonable times to such Affected Property to conduct any activity regarding the Consent Decree, including those listed in ¶ 21.a; and (ii) refrain from using such Affected Property in any manner that EPA or WDNR determines will pose an unacceptable risk to human health or to the environment due to exposure to Waste Material, or interfere with or adversely affect the implementation, integrity, or protectiveness of the Remedial Action.

         a. Access Requirements. The following is a list of activities for which access is required regarding the Affected Property:

(1) Monitoring the Work;
(2) Verifying any data or information submitted to the United States or the State;
(3) Conducting investigations regarding contamination at or near the Site;
(4) Obtaining samples;
(5) Assessing the need for, planning, or implementing additional response actions at or near the Site;
(6) Assessing implementation of quality assurance and quality control practices as defined in the approved construction quality assurance quality control plan as provided in the SOW;
(7) Implementing the Work pursuant to the conditions set forth in ¶ 79 (Work Takeover);
(8) Inspecting and copying records, operating logs, contracts, or other documents maintained or generated by Settling Defendant or its agents, consistent with Section XIX (Access to Information);
(9) Assessing Settling Defendant's compliance with the Consent Decree; and
(10) Determining whether the Affected Property is being used in a manner that is prohibited or restricted, or that may need to be prohibited or restricted under the Consent Decree.
(11) Implementing, monitoring, maintaining, reporting on, and enforcing any Institutional Controls and the requirements of the ICIAP.

         22. Access to State-Owned or Controlled Lands. The State shall provide Settling Defendant and EPA and their representatives, including contractors, with access at all reasonable times to that portion of the Site owned or controlled by the State to conduct any activity related to this Consent Decree.

         23. Institutional Controls. If EPA, or WDNR, determines in a decision document prepared in accordance with the NCP that Institutional Controls in the form of state or local laws, regulations, ordinances, zoning restrictions, or other governmental controls or notices are needed, Settling Defendant shall:

a. Assist in the execution of Institutional Controls, in accordance with the Institutional Controls and Implementation and Assurance Plan under the SOW, and the continuing obligations imposed in accordance with Ch. 292, Wis. Stat., which can be included in the WDNR Database, that (i) grant a right of access to conduct any activity regarding the Consent Decree including, but not limited to, those activities listed in Paragraph 21.a, and (ii) grant the right to enforce the land/water use restrictions set forth in Paragraph 21, including, but not limited to, the specific restrictions listed in the ICIAP, and/or continuing obligations imposed in accordance with Ch. 292, Wis.Stat. The Institutional Controls shall be imposed by one or more of the following persons, as determined by EPA or WDNR: (i) the United States, on behalf of EPA, and its representatives, (ii) the State and its representatives, and/or (iii) appropriate owners, lessees and grantees. The Institutional Controls shall include a designation that EPA, WDNR and Settling Defendant as appropriate, are third party beneficiaries. EPA and/or WDNR shall maintain the right to enforce the Institutional Controls without acquiring an interest in real property. Settling Defendant shall monitor, maintain, and report on Institutional Controls if any Institutional Controls are imposed, provided that the property owner or occupier is in compliance with Ch. 292.12(5m)(ar), Wis. Stat.
b. Provide notification to such persons of pending imposition of any applicable Institutional Controls for those properties, and placement of the relevant information in the WDNR Database.
c. Within 15 days of the approval and acceptance of the Phase 2 Remedial Action Work Plan and issuance of an approval letter to Settling Defendant incorporating Institutional Controls, WDNR shall place any applicable Institutional Controls in the WDNR Database.
d. Should EPA and WDNR determine that any applicable Institutional Controls require modification, Settling Defendant shall draft and finalize revised Institutional Controls as requested by EPA and WDNR. Upon request by EPA or WDNR, Settling Defendant shall use “best efforts” to execute and record easements or covenants running with the land that (a) limit land, water, or resource use and/or provide access rights and (b) are created pursuant to common law or statutory law by an instrument that is recorded by the owner in the appropriate land records office.

         24. Best Efforts. As used in this Section, “best efforts” means the efforts that a reasonable person in the position of Settling Defendant would use so as to achieve the goal in a timely manner, including the cost of employing professional assistance and the payment of reasonable sums of money to secure access, agreements, releases, subordinations, modifications, or relocations of Prior Encumbrances that affect the title to the Affected Property, as applicable. “Best efforts” shall not, however, include payment of money to any party that has received special notice of potential liability related to the Site, or the payment of money to the State. If Settling Defendant is unable to accomplish what is required through “best efforts” in a timely manner, it shall notify Plaintiffs, and include a description of the steps taken to comply with the requirements. If Plaintiffs deem it appropriate, they may assist Settling Defendant, or take independent action, in obtaining such Institutional Controls, agreements, releases, subordinations, modifications, or relocations of Prior Encumbrances that affect the title to the Affected Property, as applicable. All costs incurred by Plaintiffs in providing such assistance or taking such action, including the cost of attorney time and the amount of monetary consideration or just compensation paid, constitute Future Response Costs to be reimbursed under Section X (Payments for Response Costs).

         25. In the event of any Transfer of the Affected Property, unless the United States and WDNR otherwise consent in writing, Settling Defendant shall continue to comply with its obligations under the Consent Decree, including its obligation to provide and/or secure access, to implement, maintain, monitor, and report on Institutional Controls as described in Paragraph 23.a, and to abide by such Institutional Controls to the extent applicable to Settling Defendant.

         26. Notwithstanding any provision of the Consent Decree, Plaintiffs retain all of their access authorities and rights, as well as all of their rights to require Institutional Controls, including enforcement authorities related thereto, under CERCLA, RCRA, and any other applicable statute or regulations.

         IX. FINANCIAL ASSURANCE

         27. In order to ensure completion of the Work, Settling Defendant shall secure financial assurance, initially in the amount of $42, 000, 000 (“Estimated Cost of the Work”), for the benefit of EPA. The financial assurance must be one or more of the mechanisms listed below, in a form substantially identical to the relevant sample documents available from the “Financial Assurance” category on the Cleanup Enforcement Model Language and Sample Documents Database at http://cfpub.epa.gov/compliance/models/, and satisfactory to EPA. Settling Defendant may use multiple mechanisms if they are limited to surety bonds guaranteeing payment, letters of credit, trust funds, and/or insurance policies.

         a. A surety bond guaranteeing payment and/or performance of the Work that is issued by a surety company among those listed as acceptable sureties on federal bonds as set forth in Circular 570 of the U.S. Department of the Treasury;

         b. An irrevocable letter of credit, payable to or at the direction of EPA, that is issued by an entity that has the authority to issue letters of credit and whose letter-of-credit operations are regulated and examined by a federal or state agency;

         c. A trust fund established for the benefit of EPA that is administered by a trustee that has the authority to act as a trustee and whose trust operations are regulated and examined by a federal or state agency;

         d. A policy of insurance that provides EPA with acceptable rights as a beneficiary thereof and that is issued by an insurance carrier that has the authority to issue insurance policies in the applicable jurisdiction(s) and whose insurance operations are regulated and examined by a federal or state agency;

         e. A demonstration by Settling Defendant that it meets the relevant financial test criteria of 40 C.F.R. § 264.143(f) and reporting requirements of this Section for the sum of the Estimated Cost of the Work and the amounts, if any, of other federal, state, or tribal environmental obligations financially assured through the use of a financial test or guarantee, accompanied by a standby funding commitment, which obligates Settling Defendant to pay funds to or at the direction of EPA, up to the amount financially assured through the use of this demonstration in the event of a Work Takeover; or

         f. A guarantee to fund or perform the Work executed in favor of EPA by one of the following: (1) a direct or indirect parent company of Settling Defendant; or (2) a company that has a “substantial business relationship” (as defined in 40 C.F.R. § 264.141(h)) with Settling Defendant; provided, however, that any company providing such a guarantee must demonstrate to EPA's satisfaction that it meets the relevant financial test criteria of 40 C.F.R. § 264.143(f) and reporting requirements of this Section for the sum of the Estimated Cost of the Work and the amounts, if any, of other federal, state, or tribal environmental obligations financially assured through the use of a financial test or guarantee.

         28. Settling Defendant has selected, and EPA has found satisfactory, as an initial financial assurance a demonstration pursuant to ¶ 27.f in the form attached as Appendix D. Within 30 days after the Effective Date, Settling Defendant shall secure all executed and/or otherwise finalized mechanisms or other documents consistent with the form of financial assurance attached as Appendix D and shall submit such mechanisms and documents to the EPA Regional Financial Management Officer, to the United States, EPA, and the State as specified in Section XXI (Notices and Submissions). Settling Defendant must, within 30 days of the Effective Dated:

         a. Demonstrate that:

         (1) the affected Settling Defendant or guarantor has:

1. Two of the following three ratios: a ratio of total liabilities to net worth less than 2.0; a ratio of the sum of net income plus depreciation, depletion, and amortization to total liabilities greater than 0.1; and a ratio of current assets to current liabilities greater than 1.5; and
2. Net working capital and tangible net worth each at least six times the sum of the Estimated Cost of the Work and the amounts, if any, of other federal, state, or tribal environmental obligations financially assured through the use of a financial test or guarantee; and
3. Tangible net worth of at least $10 million; and
4. Assets located in the United States amounting to at least 90 percent of total assets or at least six times the sum of the Estimated Cost of the Work and the amounts, if any, of other federal, state, or tribal environmental obligations financially assured through the use of a financial test or guarantee; or

         (2) The affected Settling Defendant or guarantor has:

1. A current rating for its senior unsecured debt of AAA, AA, A, or BBB as issued by Standard and Poor's or Aaa, Aa, A or Baa as issued by Moody's; and
2. Tangible net worth at least six times the sum of the Estimated Cost of the Work and the amounts, if any, of other federal, state, or tribal environmental obligations financially assured through the use of a financial test or guarantee; and
3. Tangible net worth of at least $10 million; and
4. Assets located in the United States amounting to at least 90 percent of total assets or at least six times the sum of the Estimated Cost of the Work and the amounts, if any, of other federal, state, or tribal environmental obligations financially assured through the use of a financial test or guarantee; and

         b. Submit to EPA for the affected Settling Defendant or guarantor: (1) a copy of an independent certified public accountant's report of the entity's financial statements for the latest completed fiscal year, which must not express an adverse opinion or disclaimer of opinion; and (2) a letter from its chief financial officer and a report from an independent certified public accountant substantially identical to the sample letter and reports available from EPA or under the “Financial Assurance - Settlements” subject list category on the Cleanup Enforcement Model Language and Sample Documents Database at https://cfpub.epa.gov/compliance/models/.

         29. Settling Defendant must also:

a. Annually resubmit the documents described in ¶ 28.b within 90 days after the close of the affected Respondent's or guarantor's fiscal year;
b. Notify EPA within 30 days after the affected Respondent or guarantor determines that it no longer satisfies the relevant financial test criteria and requirements set forth in this Section; and
c. Provide to EPA, within 30 days of EPA's request, reports of the financial condition of the affected Respondent or guarantor in addition to those specified in ¶ 94.b; EPA may make such a request at any time based on a belief that the affected Respondent or guarantor may no longer meet the financial test requirements of this Section.

         30. Settling Defendant shall diligently monitor the adequacy of the financial assurance. If Settling Defendant becomes aware of any information indicating that the financial assurance provided under this Section is inadequate or otherwise no longer satisfies the requirements of this Section, Settling Defendant shall notify EPA of such information within 7 days. If EPA determines that the financial assurance provided under this Section is inadequate or otherwise no longer satisfies the requirements of this Section, EPA will notify the affected Settling Defendant of such determination. Settling Defendant shall, within 30 days after notifying EPA or receiving notice from EPA under this Paragraph, secure and submit to EPA for approval a proposal for a revised or alternative financial assurance mechanism that satisfies the requirements of this Section. EPA may extend this deadline for such time as is reasonably necessary for Settling Defendant, in the exercise of due diligence, to secure and submit to EPA a proposal for a revised or alternative financial assurance mechanism, not to exceed 60 days. Settling Defendant shall follow the procedures of ¶ 32 (Modification of Amount, Form, or Terms of Financial Assurance) in seeking approval of, and submitting documentation for, the revised or alternative financial assurance mechanism. Settling Defendant's inability to secure and submit to EPA financial assurance in accordance with this Section shall in no way excuse performance of any other requirements of this Consent Decree, including, without limitation, the obligation of Settling Defendant to complete the Work in accordance with the terms of this Consent Decree.

         31. Access to Financial Assurance.

         a. If EPA issues a notice of implementation of a Work Takeover under ¶ 79.b, then, in accordance with any applicable financial assurance mechanism and/or related standby funding commitment, EPA is entitled to: (1) the performance of the Work; and/or (2) require that any funds guaranteed be paid in accordance with ¶ 31.d.

         b. If EPA is notified by the issuer of a financial assurance mechanism that it intends to cancel such mechanism, and the affected Settling Defendant fails to provide an alternative financial assurance mechanism in accordance with this Section at least 30 days prior to the cancellation date, the funds guaranteed under such mechanism must be paid prior to cancellation in accordance with ¶ 31.d.

         c. If, upon issuance of a notice of implementation of a Work Takeover under ¶ 79.b, either: (1) EPA is unable for any reason to promptly secure the resources guaranteed under any applicable financial assurance mechanism and/or related standby funding commitment, whether in cash or in kind, to continue and complete the Work; or (2) the financial assurance is provided under ¶ 27.e or 27.f, then EPA may demand an amount, as determined by EPA, sufficient to cover the cost of the remaining Work to be performed. Settling Defendant shall, within 45 days of such demand, pay the amount demanded as directed by EPA.

         d. Any amounts required to be paid under this ¶ 31 shall be, as directed by EPA: (i) paid to EPA in order to facilitate the completion of the Work by EPA or by another person; or (ii) deposited into an interest-bearing account, established at a duly chartered bank or trust company that is insured by the FDIC, in order to facilitate the completion of the Work by another person. If payment is made to EPA, EPA may deposit the payment into the EPA Hazardous Substance Superfund or into the Ashland/Northern States Power Special Account within the EPA Hazardous Substance Superfund to be retained and used to conduct or finance response actions at or in connection with the Site, or to be transferred by EPA to the EPA Hazardous Substance Superfund.

         e. All EPA Work Takeover costs not paid under this ¶ 31 must be reimbursed as Future Response Costs under Section X (Payments for Response Costs).

         32. Modification of Amount, Form, or Terms of Financial Assurance. Settling Defendant may submit, on any anniversary of the Effective Date or at any other time agreed to by the Parties, a request to reduce the amount, or change the form or terms, of the financial assurance mechanism. Any such request must be submitted to EPA in accordance with ¶ 27, and must include an estimate of the cost of the remaining Work, an explanation of the bases for the cost calculation, and a description of the proposed changes, if any, to the form or terms of the financial assurance. EPA will notify Settling Defendant of its decision to accept or reject a requested reduction or change pursuant to this Paragraph. Settling Defendant may reduce the amount of the financial assurance mechanism only in accordance with: (a) EPA's approval; or (b) if there is a dispute, the agreement, final administrative decision, or final judicial decision resolving such dispute under Section XIV (Dispute Resolution). Any decision made by EPA on a request submitted under this Paragraph to change the form or terms of a financial assurance mechanism shall be made in EPA's sole and unreviewable discretion, and such decision shall not be subject to challenge by Settling Defendant pursuant to the dispute resolution provisions of this Consent Decree or in any other forum. Within 30 days after receipt of EPA's approval of, or the agreement or decision resolving a dispute relating to, the requested modifications pursuant to this Paragraph, Settling Defendant shall submit to EPA documentation of the reduced, revised, or alternative financial assurance mechanism in accordance with ¶ 27.

         33. Release, Cancellation, or Discontinuation of Financial Assurance. Settling Defendant may release, cancel, or discontinue any financial assurance provided under this Section only: (a) if EPA issues a Certification of Work Completion under ΒΆ 4.7 (Certification of Work Completion) of the SOW; (b) in accordance with EPA's approval of such release, cancellation, or discontinuation; or (c) if there is a dispute regarding the release, cancellation or discontinuance of any financial assurance, in ...


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