Legal Department

Correspondence
Metro is constructing a Light Rail line along Harrisburg Avenue through the East End.
The line will cross the UP rail corridor at Hughes Street. UP refuses to allow an at-
grade crossing, so the rail line must go over or under the rail corridor. Groundwater
contamination is known to exist in the area proposed for construction. Metro has
proposed an overpass claiming potential liability for cleanup and response for the
existing groundwater contamination as the basis for not constructing an underpass.
ISSUES:
In the case of potential liability for groundwater contamination under Harrisburg
Street, you have asked two questions: Would construction of an underpass
intersecting the existing groundwater plume generate environmental liability for
the City? Conversely, is there a legal interpretation in which the City would have
no environmental liability for that contamination? Would construction of an
underpass intersecting the existing groundwater plume generate environmental
liability for METRO?
The Comprehensive Environmental Response, Compensation and Liability Act
(CERCLA) was enacted in 1980 in response to environmental and health dangers
posed by property contamination from hazardous substances. 42 U.S.C. 9601 et seq.
Because CERCLA imposes strict liability, plaintiffs generally need not prove causation,
only that the defendant is a covered person. Section 107(a)(4) says that covered
persons are liable for costs incurred by the federal or state government in responding to
the contamination. CERCLA doesnt mandate joint and several liability, but for the past
25 years courts have relied on the Restatement to rule that where the harm is
indivisible, liability is joint and several.
There are four categories of covered persons who may be liable for cleanup costs
associated with the release or threatened release of hazardous substances: 1) owners
and operators of facilities at which hazardous substances are located; 2) past owners
To: Mayor Annise D. Parker
Robert Gallegos,
Councilmember
Ed Gonzales, Councilmember
From: David M. Feldman
City Attorney
cc:
Date: May 6, 2014
Subject: Hughes Underpass; Environmental
Issues
CITY OF HOUSTON
Interoffice
and operators of such facilities at the time that the release of hazardous substances
occurred; 3) persons who arranged for disposal or treatment of hazardous substances;
and 4) certain transporters of hazardous substances. See 42 U.S.C. 9607(a)(1)-(4).
The City can be an owner or operator of a facility at which hazardous substances are
located.
1
The broader category, that of an operator, probably does not apply to the
Citys transportation easement over Harrisburg Street but an argument might be
constructed that the City is an owner under the statute. METRO in constructing the
underpass would likely generate waste that contains contaminated soil and water that
would have to be disposed in a manner more costly than uncontaminated material.
For one to be considered an operator, there must be some nexus between that entity's
control and the hazardous waste contained in the facility. This nexus has been
described as a well-settled rule that operator liability ... only attaches if the
defendant had authority to control the cause of the contamination at the time the
hazardous substances were released into the environment. Kaiser Aluminum & Chem.
Corp. v. Catellus Dev. Corp., 976 F.2d 1338, 1341 (9th Cir.1992); see also CPC Int'l,
Inc. v. AerojetGeneral Corp., 731 F. Supp. 783, 788 (W.D. Mich.1989)(The most
commonly adopted yardstick for determining whether a party is an owner-operator
under CERCLA is the degree of control that party is able to exert over the activity
causing the pollution.) More recently, a Texas appellate court held that a municipality
had no operator liability under CERCLA, RCRA, or Texas Solid Waste Disposal Act
when it controlled the volume and end use of water it provided for firefighting activities
at the Helotes Mulch Fire. The Texas Court of Appeals (Austin) held that SAWS was
not liable as an operator for the contamination caused by the fire as a result of its
decision-making associated with providing water for firefighting activities. Zumwalt v.
City of San Antonio, 2012 WL 1810962 (Tex. App.--Austin May 17, 2012) (NO. 03-11-
00301-CV). The contamination under Harrisburg resulted from historical activities at
adjacent properties not owned or operated by the City and the City would have had no
ability to control the causes of the releases of hazardous substances. Accordingly,
there is no reason to believe that construction and maintenance of an underpass would
generate operator liability for the City.
The more narrow category, owners of facilities, likely also does not apply to the Citys
mere transportation easement. The common law distinguishes the definition of an
easement from a fee simple interest as only the right to use someones land for a
specified purpose. Courts have held that Congress did not seek to impose Superfund
liability on every person who has any interest at all in land.
2
Notwithstanding its lack of liability, in several circumstances the City has taken actions
implying that holding an exclusive transportation easement does give the City a right to
control the subsurface conditions of its streets. For example, in order to place a
monitoring well in a City street, one must obtain a permit from the Department of Public
Works and Engineering. See Chapter 40, Article XII of the Code of Ordinances. In the
1
Although the statutory language carves out liability for governmental entities, that exclusion only applies
in case of involuntary acquisition through bankruptcy, tax delinquency, abandonment, or other
circumstances in which the government involuntarily acquires title by virtue of its function as sovereign.
42 U.S.C. 9601(20)(A), (D).
2
Long Beach Unified Sch. Dist. V. Dorothy B. Goodwin Cal. Living Trust, 32 F.3d 1364, 1370 (9
th
Cir.
1994).
municipal setting designation process, the Code states that the director of public works
may recommend that [an MSD] ordinance prohibit the use of the designated
groundwater from beneath public rights of way immediately adjacent to the designated
property as potable water. 47-765(a)(1) a. The City routinely agrees to those
requests by MSD applicants, and at least 25% of the MSD ordinances do restrict
groundwater beneath City streets.
Finally, recall the context in which the Citys or Metros potential liability would arise:
EPA or TCEQ would be taking an enforcement action under either CERCLA or the
Texas Solid Waste Disposal Act, and would be naming the City or Metro as a potentially
responsible party.
METROs Potential Liability:
During construction of an underpass METRO will likely encounter contaminated soil and
groundwater, will have to use appropriate safety measures for the construction teams,
and will generate waste (excess soil from the excavation and potentially contaminated
groundwater from de-watering activities below grade level). That waste will have to be
characterized and either appropriately managed onsite, or manifested to an appropriate
facility offsite All of these measures can often add costs to the construction process,
but these costs can be readily quantified. If any waste must be disposed offsite, the
manifest serves as a long tail for liability associated with that waste in a landfill for which
METRO would be the generator.
METRO fears a claim that its work will exacerbate the contamination by redirecting the
plume. However, we are aware of no cases in which such a fact scenario would impose
liability. The closest case, K.C. 1986 Ltd. Pship v. Reade Mfrg, did find liability when
the consultants work expanded the contaminated plume by piercing through one water-
bearing unit to the drinking water aquifer. 33 F. Supp.820 (W.D. Mo. 1998). In our facts,
the contaminated groundwater is shallow, and is located in the same general
hydrostatic level in which most of the city-supported MSDs have prohibited groundwater
use (i.e., no deeper than 200 feet below grade, by statute). There is no evidence to
suggest that METROs construction activity whether its an underpass or overpass could
negligently expand the contamination down to the level of a drinking water aquifer.
Even if the plume were to be redirected to an area previously not contaminated (and
there is no evidence to suggest that such could occur), the general rule is that a claim
brought by that adjacent landowner is one for a temporary injury to the land. Texas
cases have measured those damages for the loss of use of the water for domestic or
farm purposes, see, e.g., Texas Co. v. Giddings, 148 S.W. 1142 (Tex. Civ. App.
Dallas 1912), or, if the damage is permanent, the diminution of reasonable market value
of the land before and after the injury. Nash & Windfohr v. Edens, 109 S.W. 2d 496
(Tex. Civ. App.Fort Worth 1937, writ dismd). Proof of damage for loss of use would
be difficult for a plaintiff suing METRO, since the contaminated groundwater is not
capable of being used for drinking water. It would similarly be difficult for a plaintiff to
prevail on the diminution of market value, since there is no evidence to support an
argument that the contamination of the shallow groundwater is permanent. Kraft v.
Langford, 565 S.W. 2d 223 (Tex. 1978). METRO has enrolled the construction project
along Harrisburg into TCEQs Voluntary Cleanup Program, which anticipates that at
some point, the contamination in the groundwater will no longer pose a threat to human
health or the environment. Thus, the damage is only temporary, and the damages will
be measured by the reasonable cost to restore the land to its pre-contaminated
condition, unless METRO could successfully argue that the cost of restoration is less
than the diminution in value of the land. Atlas Chem. Indus., Inc. v. Anderson, 514
S.W.2d 309 (Tex. Civ. App.Texarkana 1974), affd in part, revd in part, 524 S.W. 2d
681 (Tex. 1975). Finally, no Texas courts have awarded so-called stigma damages,
based under a private nuisance doctrine for a non-tresspassory invasion of anothers
interest in the private use and enjoyment of land. No Texas cases discuss stigma
damages, and the Citys own, very successful MSD program demonstrates the
weakness of such a claim.
As part of the 2008 Consent Agreement to construct the Light Rail Project, Metro
acquired additional rights-of-way required for the project to maintain adequate street
capacity, and conveyed approximately 340 parcels to the City. Metro, with the Citys
concurrence, chose not to perform environmental site assessments (ESAs) on many
of the small parcels conveyed, such as corner clips, which consisted of both easement
property and fee simple property, even though a number of those parcels had possible
environmental issues. Based on a variety of criteria (size of parcel, intended use
(paved or landscaped), level of potential impact, whether in soil or groundwater), and
because the likelihood of exposure to those impacts, whether by City workers or
citizens, none of these parcels present an unacceptable risk to the City.
CONCLUSION:
As the holder of a transportation easement unrelated to the historic control over
hazardous substances at the proposed Harrisburg construction location, the City will not
likely have any liability for past contamination that may exist at the property. However;
should the City find it advantageous to assume some responsibility for the
contamination, its past practice of exerting control over groundwater and groundwater
conditions beneath property over which the City has a transportation easement
indicates that it may assert some public interest for managing the groundwater
conditions under its transportation easements. METRO may incur increased costs
associated with the environmental conditions in constructing an underpass, but those
costs may be quantified and managed.