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Precedent Setting Case: State DOTs Liable For Cleaning Up Contamination From Highway Stormwater Runoff


07/07/10

On June 7, a federal court ruled, for the first time, that a state DOT is liable for the cost of cleaning up and restoring areas contaminated by highway stormwater runoff.  This ruling could  have long-term consequences for highway design and operation, and perhaps for storm water management systems generally. 

In U.S. v. Wash. St. Dept. of Transportation, ___ F.Supp.2d ___, 2010 WL 2302502 (W.D. Wash.), the U.S. District Court for the Western District of Washington found the Washington Department of Transportation ("WSDOT") liable for the costs of cleaning up contamination from stormwater runoff from two state highways and an interstate highway that came to be located at the Commencement Bay Superfund Site.  Judge Robert Ryan ruled WSDOT was a liable party under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA'), commonly known as Superfund, because WSDOT "arranged for the disposal" of stormwater by designing drainage systems for the three highways. 

Under CERCLA, a party who arranges for the disposal or treatment of hazardous substances released at a facility can be jointly and severally liable for (1) cleanup costs and (2) the cost of restoring the environment after cleanup.  Here, the U.S. has not claimed that WSDOT is an "owner" or "operator" of a facility, but rather has acted to arrange for the release of contaminants into the affected water body.  Joint and several liability means each liable party can be responsible for 100% of the cleanup and restoration costs, which are often measured in the tens or hundreds of millions of dollars.  At issue in this case was WSDOT's potential liability for $6.8 million in cleanup costs already incurred at a Superfund site and future clean-up costs which, not including restoration, are expected to exceed $52 million. 

WSDOT claimed it has a Clean Water Act ("CWA") permit authorizing the stormwater releases, does not own the highway property, has no control over contaminants that are carried away from rainwater, and any contaminants released into highway storm drains were present because of the actions of third parties, .i.e. drivers using the road.  The U.S. countered that WSDOT arranged for the disposal of hazardous substances from the highways by designing, constructing, and operating drainage systems whose sole function was to collect highway runoff and dispose of it into nearby water bodies.  The U.S. argued that WSDOT knew highway stormwater runoff contains hazardous substances and had the ability to "redirect, contain, and treat its contaminated runoff."  The hazardous substances at issue included petroleum hydrocarbons, phthalates, and heavy metals such as cadmium lead, zinc, and nickel. 

The court agreed with the U.S., finding that WSDOT designed the drainage systems, knew stormwater runoff contains hazardous substances, and had control over the disposal of the runoff.  The court also rejected WSDOT's argument that WSDOT was not liable because it was exercising its sovereign powers non-negligently. 

As to the existence of a CWA permit, the court acknowledged that federally permitted releases are exempt from CERCLA liability but noted there would be a further decision as to whether this defense is, in fact, available to WSDOT.  The U.S. is arguing the permits do not cover the releases and, even if they do, WSDOT is not in compliance with the permits. 

Regarding WSDOT's argument that the contaminants in the stormwater were caused by individuals using the highway and other sources, the U.S. argued WSDOT had not proven the releases were caused "solely" by a third party and, even if they were, WSDOT failed to exercise "due care" because it did not use the best methods and practices for treatment of stormwater.  The court deferred a decision on this issue to later proceedings. 

Notwithstanding that the district court will conduct further proceedings on what defenses might be available to WSDOT, the court's ruling decides for the first time that the mere act of building a highway with a stormwater management program can make a state DOT liable for Superfund cleanup costs as an "arranger".  Presumably, this decision, should it survive the likely appeal, could have broader implications for others involved in the design and management of stormwater collection and discharge systems – property developers, industrial and commercial concerns, school and other public service agencies, and the like.


A partner with Nossaman, George Mannina, Jr. has more than three decades of experience with environmental litigation and government relations.  He can be reached at 202.887.1491 or gmannina@nossaman.com.

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