What to know about natural resource damages under Superfund

Responsible use of natural resources 8 February 2021 Miranda H. Henning Lawrence Malizzi

While responsible parties are typically well versed in their obligations under Superfund to investigate and remediate environmental contamination, it can come as a surprise when – after achieving a resolution with USEPA – they may face allegations from the Department of Interior (DOI), National Oceanic and Atmospheric Administration (NOAA), a state or tribal nation for the lost use of natural resources as a result of historical release. Early actions to help settle NRD cases are critical to managing long-term liability.

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8 min

What are Natural Resource Damages (NRD)?

Superfund defines natural resources as including “land, fish, wildlife, biota, air, water, groundwater, drinking water supplies, among other such resources” held in trust for the public, also known as trust resources (i.e., “belonging to, managed by, held in trust by, appertaining to, or otherwise controlled by the United States, any State, an [American] Indian Tribe, a local government, or a foreign government”).

Damages are recoverable at sites where injuries to natural resources have occurred as a result of releases of hazardous substances or oil or related to implementation of a response action and are incorporated in the Superfund law and Oil Pollution Act. NRD is the sum of 1) the cost of restoring to baseline, rehabilitating, replacing or acquiring the equivalent of injured resources; 2) interim lost use of the natural resource from the time of injury until it is restored; and 3) the cost of assessing damages.

 

What qualifies as an injury?

Under Superfund, injuries are defined as:

  • Resources exposed to an unpermitted release of oil or hazardous substance
    (e.g., surface water concentrations that exceed water quality standards)
  • Adverse physical or chemical change to the resource (e.g., reduced reproduction in an exposed wildlife species
  • Loss of ecological or human use services provided by the natural resource
    (e.g., fish kill, fish or game consumption advisories)

What is the role of the Trustee?

Trustees may be federal, state or tribal. Federal Trustees are DOI (US National Park Service, US Fish & Wildlife Service) and NOAA. State Trustees are state governors, who often delegate that authority to the Department of Environmental Quality (DEQ) or equivalent. Native American tribal nations also are Trustees.

Trustees are responsible for seeking compensation for any damages resulting from natural resource injuries. The process for recouping those damages includes conducting a pre-assessment screen to determine the potential for natural resource injuries resulting from a release or discharge, determining and quantifying the extent of any damages resulting from those injuries, and developing and implementing the restoration plan for compensating for those damages.

How does NRD differ from ordinary remediation requirements? 

In addition to their stipulations for investigation and remediation, Superfund and OPA require that natural resources be restored to the state that they would be in but for the injury caused by the release (i.e., “baseline”). That is, reducing contamination to levels that do not pose risk to human health and the environment may not be enough – it may also be necessary to restore habitat to pre-release conditions. And the public must be “made whole” for their lost use of the natural resources due to the release. As a result, NRD can be more costly than the traditional investigation and clean up under Superfund.

NRD includes injury to, destruction of, or loss of Trust resources, including the reasonable costs of a damage assessment. 

Negotiating a compromise settlement often takes years, and the longer it takes to settle a claim, the more costly it becomes. NRD settlements can exceed the cost to investigate and remediate the release. 

What can you do to prepare?

Though official notice may not come until after the Record of Decision is signed, if you receive communications in which representatives of potential Trustees are copied, it is wise to start planning for an NRD case. As most NRD cases proceed slowly and Trustees prefer to work cooperatively with responsible parties, there is often adequate time to develop a strategy and plan future work.

Taking early action will help you maintain relationships with Trustees, enable an NRD settlement to proceed smoothly, and is critical to managing long-term liability at your site.

Related resources

Webinar: Successful NRDA Early Restoration Project in Action – North Breton Island

Webinar: Pre-Disaster Planning and Post-Disaster Claims, Building Assessment & Data Management

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