> > >>> Robert Reichel 10/11/02 03:56PM >>>
> > Art,
> > You are welcome. Mike Leffler is out of the office today, but I have
> > shared your note and request with him. He asked me to convey the
> > following response.
> > Unfortunately, we cannot offer legally acceptable language to
> > accomplish what is proposed in the draft order because it does not
> > exist. Simply put, the very essence of the proposed order is illegal.
> > Although DEQ management and Dow's outside counsel, Mr. Robinson, have
> > apparently been negotiating both the form and substance of the proposed
> > Corrective Action Consent Order since August, DEQ first sought our
> > legal advice and provided a draft of the document on the afternoon of
> > October 1. As you know, you requested our immediate review to enable
> > DEQ to release a draft Order, together with a draft Part 111 hazardous
> > waste treatment facility operating license, for public comment beginning
> > October 7.
> > As requested, we immediately reviewed the document. In his October 3
> > email to you, Mike Leffler clearly told you that the draft order is
> > illegal and that DEQ lacks the legal authority to sign it. He explained
> > that among other things, the order: 1) unlawfully purported to relieve
> > Dow of certain liability to the state, 2) arbitrarily and illegally
> > established certain "action levels" for dioxin in soils ten times
> > greater than DEQ's existing statewide standards under Part 201 through
> > processes not in compliance with Parts 111 and 201, 3) unlawfully
> > delegated DEQ regulatory authority to private parties, and 4) illegally
> > substituted "dispute resolution" procedures involving a de novo trial in
> > Midland County Circuit Court for the administrative and judicial
> > processes specified in applicable law.
> > Further, Mike's October 3 email emphasized that "the document is
> > fatally flawed and the DEQ cannot legally bind itself in the way the
> > agreement contemplates. While Mike said that we were willing to work
> > with DEQ to assist in drafting a lawful agreement, he bluntly added
> > that "any such agreement would have to be profoundly different from the
> > one I received." I understand that Mike has also reiterated those
> > concerns in a recent meeting with you.
> > DEQ presumably communicated our legal concerns to Dow, whose counsel,
> > Mike Robinson then contacted us. In a series of recent communications,
> > Mike Leffler and I have repeatedly explained to Mr. Robinson, at length,
> > that the proposed Order (even as modified by Dow in drafts dated October
> > 4 and October 9) was and remains fundamentally illegal. Those
> > communications included a meeting on October 7, phone discussions on
> > October 8, my emails to Mr. Robinson dated October 8 and 9, and a
> > lengthy phone conversation with him on October 10. On every one of those
> > occasions, we explained that the problem was not one of simply deleting
> > or modifying certain language. Instead, we repeatedly told him that
> > the basic scope and structure of the agreement were fatally flawed.
> > However, only in the last conversation did he profess to understand the
> > full nature of our legal objections. Shortly thereafter, we received
> > your note.
> > I will once again summarize what we have previously told both you and
> > Dow's counsel. For more than a decade, Dow has been and remains under
> > an affirmative statutory obligation to perform corrective action for
> > off-site as well as on-site releases of contaminants (including, but not
> > limited to dioxin) from its Midland facility. Under Part 111's Rule
> > 629, Dow is required to perform such corrective action as necessary to
> > protect public health, safety, welfare and the environment. At a
> > minimum, such corrective action must satisfy "environmental protection
> > standards" that are established pursuant to Part 201.
> > As you well know, the only existing DEQ Part 201 cleanup standard for
> > dioxin in residential soils (the subject of the proposed order) is 90
> > parts per trillion (ppt). Despite the urgings of Dow, DEQ has
> > apparently decided not to increase that generic residential cleanup
> > criterion in the still- pending revisions to the Part 201 Rules.
> > Consequently, the only other legal basis for establishing a cleanup
> > criterion for dioxin in soils as contemplated in the draft Order is if
> > the DEQ approves a remedial action plan pursuant to MCL 324.20120a(2)
> > "based on site specific criteria that satisfy the applicable
> > requirements of this part and the rules promulgated under this part."
> > Those requirements include, among other things, "[a]ssuring the
> > protection of public heath, safety welfare and the environment" as well
> > as performing a site-specific risk assessment addressing all
> > requirements of existing Part 201 Rule 717(2), particularly, the use of
> > "best available information" as defined in Rule 701(d).
> > In addition, both Parts 111 and 201 impose upon DEQ the duty to itself
> > determine that the statutory criteria of protectiveness, etc. are
> > satisfied. DEQ may not lawfully delegate those statutory duties, either
> > in whole or in part, to Dow or to a body of "independent" scientists, no
> > matter how distinguished they may be.
> > Further, it is bedrock principle of administrative law that an agency
> > may not exercise its statutory authority in an arbitrary or capricious
> > manner. DEQ, like any other agency must instead proceed in an orderly,
> > rational and deliberate fashion to consider all appropriate factors and
> > information, and provide members of the public affected by its decisions
> > meaningful notice and an opportunity to be heard.
> > Unfortunately, the course of action outlined in your note, and
> > reflected in even the most recent Dow re-draft of the proposed order,
> > utterly fails on all those counts and is therefore illegal.
> > To begin with, the so-called "interim action level" (a term that
> > appears nowhere in the relevant laws and rules and was presumably
> > invented for purposes of this Order) that you propose to establish
> > either now or in the near future cannot possibly be justified as the
> > legally required environmental protection standard established pursuant
> > to Section 20120a(2). The 1000 ppt level, is not, as you suggest a
> > cleanup standard established by either ATSDR or EPA. More important, it
> > is clearly not a "site-specific" criterion developed in compliance with
> > Part 201. Even Mike Robinson has conceded as much.
> > The alternative, but still unspecified interim action level
> > (presumably something greater than 1000 ppt) mentioned in your note and
> > still left blank (!) in Dow's last draft of the order apparently
> > doesn't even exist yet. In any event, whatever number you propose to
> > put there in the next few weeks cannot conceivably be defended as a
> > site-specific criterion lawfully and rationally derived under Section
> > 20120a (2). Your note misleadingly refers to "our initial calculation
> > using Probabilistic Risk Assessment (PRA)." However, according to both
> > Dow and your own staff, the only existing attempts to apply PRA to
> > derive a cleanup standard for dioxin in residential soils are certain
> > reports prepared by Dow's consultant, Exponent. As you well know, DEQ's
> > own toxicologists have unanimously disagreed with Exponent's
> > conclusions. More specifically, DEQ's own qualified experts have
> > concluded that many of the critical inputs used by Dow for the risk
> > assessment are not based upon best available scientific information, as
> > DEQ's own rules require.
> > Morever, EPA has specifically advised you, in writing, that Exponent's
> > work did not appear to follow the EPA guidance on PRA (upon which it
> > purports to be based) and that numerous issues would need to be
> > carefully evaluated, and publicly vetted, before PRA could properly be
> > used to guide cleanup decisions at this site. EPA also emphasized
> > that the process being followed by DEQ for review of the PRA was
> > unrealistically short. It also offered to provide expert technical
> > assistance to DEQ, an offer that to date, DEQ has apparently chosen to
> > reject.
> > Instead, it appears from your note and our discussions with Dow's
> > counsel, that DEQ management is still embarked on the course of hastily
> > trying to lash together, over the next few days or weeks, a "corrective
> > action" agreement with Dow while concurrently trying to create at least
> > the appearance of a scientific and regulatory basis for its decision to
> > relax, by at least ten times, in the Midland area DEQ's existing
> > cleanup standard.
> > You should be aware that Dow's own counsel has told us that the
> > negotiation of the proposed agreement is being driven by Dow's express
> > desire to have the DEQ commit itself in writing, by the end of 2002, to
> > an alternative cleanup standard for dioxin in Midland soils (and/or a
> > narrowly circumscribed process for adjusting it in the future). Mr.
> > Robinson explained that Dow is concerned that depending upon the results
> > of the November gubernatorial election, future DEQ management may not be
> > as receptive as the present administration to Dow's "scientific" and
> > regulatory arguments. Further, it is clear that as a matter of legal
> > strategy, Dow is anxious to position itself as having relied, to its
> > detriment, on a particular DEQ regulatory decision, when, and if a
> > future DEQ management seeks to require some different standard of
> > corrective action.
> > Obviously, such political considerations and speculation have no place
> > in our legal analysis, but you should be aware of the factual background
> > against which DEQ's actions in this matter may be judged by others.
> > Regardless of DEQ management's own actual motivations for attempting to
> > immediately conclude a written agreement with Dow on these issues, many
> > outside observers will inevitably draw the inference that the proposed
> > agreement is an "11th hour " and "sweetheart deal." Frankly, we are at
> > a loss to understand why the DEQ would want to unnecessarily subject
> > itself to such criticism.
> > The suggestion in your note that DEQ wants to conclude this proposed
> > agreement now "so that we can proceed on a course of action that will
> > compel Dow to address the dioxin issue that has been lingering for over
> > a decade" is puzzling. As noted above, Dow has been under an
> > affirmative statutory duty to implement off-site corrective action for
> > dioxin and any other contaminants for more than ten years. In that
> > entire time, until you gave us the October 1 draft of a "Corrective
> > Action Consent Order", and a late September draft operating license
> > that briefly referred to off-site corrective action, DEQ has never
> > sought legal assistance from this office to enforce such corrective
> > action obligations against Dow. Indeed, to the best of our knowledge,
> > until Dow initiated discussion earlier this year, there is no indication
> > that DEQ even requested, let alone directed Dow to perform corrective
> > action to address the off-site releases of dioxin that have been
> > documented to exist since at least 1992.
> > In any event, as Mike Leffler has told you, we are ready to work with
> > DEQ to take appropriate legal action to ensure that Dow promptly
> > initiates corrective action in compliance with applicable law. Among
> > other things, we are ready to assist your staff in drafting appropriate
> > language to be included either in a draft operating license or an
> > administrative order (either by consent or to be issued, unilaterally if
> > necessary under MCL 324. 11151) that would require Dow to develop and
> > implement , according to a specific schedule, DEQ- approved plans for
> > remedial investigation to adequately characterize the extent of the
> > off-site contamination and for cleanup/corrective action consistent with
> > Parts 111 and 201. In fact, we have already discussed the inclusion of
> > specific language for that purpose in the draft license.
> > Further, as Mike has also told you, and we told Dow, Dow is already
> > free to either perform or fund whatever dioxin health effects or other
> > scientific studies it believes are appropriate or useful. It does not
> > need an order with you to do so. If DEQ wishes to enter an agreement
> > with Dow wherein Dow agrees to perform or fund such studies and provide
> > the results to DEQ, DEQ may do so to the extent allowed by law.
> > However, what DEQ cannot legally do, as contemplated by the proposed
> > order, is to delegate its own regulatory authority to third parties and
> > arbitrarily approve in advance a particular regulatory action based
> > upon the results of the studies. DEQ cannot lawfully bargain away its
> > continuing statutory duty under Parts 111and 201 to require corrective
> > action/cleanup as needed to protect public health and the environment.
> > In sum, the course of action you propose is fundamentally illegal. We
> > urge you to instead enforce Dow's corrective action obligations as
> > provided by law and stand ready to work with you to that end.
> > >>> Arthur Nash 10/10/02 11:02AM >>>
> > Mike/Bob:
> > Thank you for continuing to review the proposed consent order in a
> > timely manner. It would be helpful if you could offer specific language
> > that you believe would be legally acceptable to allow the DEQ to enter
> > into this Order providing for the setting of an initial interim action
> > level (based on our initial calculation using Probabilistic Risk
> > Assessment (PRA) or on ATSDR's/EPA's action level of 1000 ppt); the use
> > of best available science to establish the appropriate bioavailability
> > factor that will be used in a PRA calculation for the DEQ to determine
> > and set a revised interim action level; and finally the mechanism to
> > allow the DEQ to accept/approve a final action level based on the
> > results of the proposed health study. We believe it is important to
> > finalize this document so we can proceed on a course of action that will
> > compel Dow to address the dioxin issue that has been lingering for over
> > a decade.
> > Thank you.
> > Art
> > >>> Robert Reichel 10/09/02 03:59PM >>>
> > Mike-
> > Confirming the voice mail that Mike Leffler and I left you this
> > afternoon, we have reviewed the latest revised draft corrective action
> > consent order that you sent us today. Based upon that review it is
> > painfully apparent that you have chosen to largely ignore the substance
> > of what Mike and I told you during our recent meeting and follow up
> > phone call and email. Although the latest draft makes some minor
> > changes to appear to address part of the most obvious legal problems we
> > identified, the document as revised, remains fundamentally unlawful for
> > the reasons we previously identified.
> > Under the circumstances, Mike and I see no useful purpose for
> > proceeding with meeting we scheduled for 9 AM on the 10th. Please
> > consider it canceled.
> > If and when Dow is prepared to discuss the fundamentally different
> > approach to an agreement that we described, and provides language on
> > that basis, it might make sense to proceed with a meeting.