Senate Bill No. 377

Introduced By grosfield, knox, crismore, keating, depratu, clark



A Bill for an Act entitled: "An Act generally revising the laws relating to the state Comprehensive Environmental Cleanup and Responsibility Act; providing an optional procedure for allocating liability for site remediation; creating an orphan share fund account and allocating certain fines, penalties, resource indemnity trust interest and tax proceeds, metalliferous mine tax proceeds, and other money to the account; providing for citizen suits; providing exclusions from liability; providing additional and specific rulemaking authority; amending provisions and extending the termination date of the mixed funding pilot program; amending sections 15-37-117, 15-38-106, 15-38-202, 75-2-412, 75-2-413, 75-2-427, 75-3-407, 75-5-634, 75-6-109, 75-6-114, 75-10-417, 75-10-418, 75-10-423, 75-10-424, 75-10-542, 75-10-701, 75-10-702, 75-10-704, 75-10-715, 75-10-719, 75-10-720, 75-10-724, 82-4-141, and 82-4-241, MCA, and Sections 16, 18, and 27, Chapter 584, Laws of 1995; and providing effective dates and a termination date."



WHEREAS, the 1995 Legislature, in Chapter 584, Laws of 1995, directed the Department of Environmental Quality to institute a collaborative process involving all affected and interested persons to analyze the elimination of joint and several liability with respect to the cleanup of state Comprehensive Environmental Cleanup and Responsibility Act (CECRA) facilities and to submit any legislative proposals that collaboratively resulted from that process to the 55th Legislature; and

WHEREAS, the Department instituted this collaborative process with industry and business representatives; state, federal, and local government representatives; and public interest and environmental interest group representatives; and

WHEREAS, through a contract with the Department, the Montana Consensus Council designed the study process, facilitated the organization of the collaborative process, and conducted the numerous meetings of the study committees and interest group caucuses through which the parties to the collaborative process reached consensus on legislative proposals that are contained in this bill.



STATEMENT OF INTENT

It is the intent of this bill to provide an option to the concept of joint and several liability for potentially liable persons to have their proportionate share of liability for a state Comprehensive Environmental Cleanup and Responsibility Act (CECRA) facility determined through an expedited process while ensuring that the concurrent cleanup of the facility occurs. The bill clarifies defenses to liability and creates exclusions from liability. The bill also provides rulemaking authority to the department for developing guidance and criteria and involving the public and the liable parties in the decisionmaking process for listing and delisting sites on a CECRA priority list. The department will be required to provide written justification for its decisions to list, delist, and prioritize sites needing remediation. The written criteria for listing and delisting represent the legislature's intent for this rulemaking.



Be it enacted by the Legislature of the State of Montana:



Section 1.  Section 15-37-117, MCA, is amended to read:

"15-37-117.   (Temporary) Disposition of metalliferous mines license taxes. (1) Metalliferous mines license taxes collected under the provisions of this part must, in accordance with the provisions of 15-1-501, be allocated as follows:

(a)  to the credit of the general fund of the state, 58% of total collections each year;

(b)  to the state special revenue fund to the credit of a hard-rock mining impact trust account, 1.5% of total collections each year;

(c)  to the abandoned mines state special revenue account provided for in section 19, Chapter 584, Laws of 1995, 8.5% of total collections each year;

(d)  to the ground water assessment account established in 85-2-905, 2.2% of total collections each year;

(e)  to the reclamation and development grants program state special revenue account, 4.8% of total collections each year; and

(f)  to the county or counties identified as experiencing fiscal and economic impacts, resulting in increased employment or local government costs, under an impact plan for a large-scale mineral development prepared and approved pursuant to 90-6-307, in direct proportion to the fiscal and economic impacts determined in the plan, or, if an impact plan has not been prepared, to the county in which the mine is located, 25% of total collections each year, to be allocated by the county commissioners as follows:

(i)  not less than 40% to the county hard-rock mine trust reserve account established in 7-6-2225; and

(ii) all money not allocated to the account pursuant to subsection (1)(f)(i) to be further allocated as follows:

(A)  33 1/3% is allocated to the county for planning or economic development activities;

(B)  33 1/3% is allocated to the elementary school districts within the county that have been affected by the development or operation of the metal mine; and

(C)  33 1/3% is allocated to the high school districts within the county that have been affected by the development or operation of the metal mine.

(2)  When an impact plan for a large-scale mineral development approved pursuant to 90-6-307 identifies a jurisdictional revenue disparity, the county shall distribute the proceeds allocated under subsection (1)(f) in a manner similar to that provided for property tax sharing under Title 90, chapter 6, part 4.

(3)  The department shall return to the county in which metals are produced the tax collections allocated under subsection (1)(f). The allocation to the county described by subsection (1)(f) is a statutory appropriation pursuant to 17-7-502. (Terminates June 30, 1997--sec. 27, Ch. 584, L. 1995 1999 1997--SEC. 27, CH. 584, L. 1995.)

15-37-117.   (Effective July 1, 1997 1999 1997) Disposition of metalliferous mines license taxes. (1) Metalliferous mines license taxes collected under the provisions of this part must, in accordance with the provisions of 15-1-501, be allocated as follows:

(a)  to the credit of the general fund of the state, 58% of total collections each year;

(b)  to the state special revenue fund to the credit of a hard-rock mining impact trust account, 1.5% of total collections each year;

(c)  to the state resource indemnity trust fund, 15.5% of total collections each year orphan share state special revenue account established in [section 27], 8.5% of total collections each year;

(d)  to the ground water assessment account established in 85-2-905, 2.2% of total collections each year;

(e)  to the reclamation and development grants program state special revenue account, 4.8% of total collections each year; and

(f)  to the county or counties identified as experiencing fiscal and economic impacts, resulting in increased employment or local government costs, under an impact plan for a large-scale mineral development prepared and approved pursuant to 90-6-307, in direct proportion to the fiscal and economic impacts determined in the plan, or, if an impact plan has not been prepared, to the county in which the mine is located, 25% of total collections each year, to be allocated by the county commissioners as follows:

(i)  not less than 40% to the county hard-rock mine trust reserve account established in 7-6-2225; and

(ii) all money not allocated to the account pursuant to subsection (1)(f)(i) to be further allocated as follows:

(A)  33 1/3% is allocated to the county for planning or economic development activities;

(B)  33 1/3% is allocated to the elementary school districts within the county that have been affected by the development or operation of the metal mine; and

(C)  33 1/3% is allocated to the high school districts within the county that have been affected by the development or operation of the metal mine.

(2)  When an impact plan for a large-scale mineral development approved pursuant to 90-6-307 identifies a jurisdictional revenue disparity, the county shall distribute the proceeds allocated under subsection (1)(f) in a manner similar to that provided for property tax sharing under Title 90, chapter 6, part 4.

(3)  The department shall return to the county in which metals are produced the tax collections allocated under subsection (1)(f). The allocation to the county described by subsection (1)(f) is a statutory appropriation pursuant to 17-7-502."



Section 2.  Section 15-38-106, MCA, is amended to read:

"15-38-106.   Payment of tax -- records -- collection of taxes -- refunds. (1) The tax imposed by this chapter must be paid by each person to which the tax applies, on or before March 31, on the value of product in the year preceding January 1 of the year in which the tax is paid. The tax must be paid to the department at the time the statement of yield for the preceding calendar year is filed with the department.

(2)  The department shall, in accordance with the provisions of 15-1-501(6), deposit the proceeds of the tax in the resource indemnity trust fund of the nonexpendable trust fund type, except that:

(a)  14.1% of the proceeds must be deposited in the ground water assessment account established by 85-2-905;

(b)  10% of the proceeds must be deposited in the renewable resource grant and loan program state special revenue account established by 85-1-604; and

(c)  30% of the proceeds must be deposited in the reclamation and development grants account established by 90-2-1104; and

(d) if there are sufficient unallocated funds remaining, at the beginning of each fiscal year there is allocated from the proceeds of the tax up to $200,000 to be deposited in the orphan share account established in [section 27].

(3) Every person to whom the tax applies shall keep records in accordance with 15-38-105, and the records are subject to inspection by the department upon reasonable notice during normal business hours.

(4)  The department shall examine the statement and compute the taxes to be imposed, and the amount computed by the department is the tax imposed, assessed against, and payable by the taxpayer. If the tax found to be due is greater than the amount paid, the excess must be paid by the taxpayer to the department within 30 days after written notice of the amount of deficiency is mailed by the department to the taxpayer. If the tax imposed is less than the amount paid, the difference must be applied as a tax credit against tax liability for subsequent years or refunded if requested by the taxpayer."



Section 3.  Section 15-38-202, MCA, is amended to read:

"15-38-202.   Investment of resource indemnity trust fund -- expenditure -- minimum balance. (1) All money paid into the resource indemnity trust fund, including money payable into the fund under the provisions of 15-36-324 and 15-37-117, must be invested at the discretion of the board of investments. All the net earnings accruing to the resource indemnity trust fund must annually be added to the trust fund until it has reached the sum of $10 million. Thereafter, only the net earnings may be appropriated and expended until the fund reaches $100 million. Thereafter, all net earnings and all receipts must be appropriated by the legislature and expended, provided that the balance in the fund may never be less than $100 million.

(2)  (a) At the beginning of each fiscal year, there is allocated from the interest income of the resource indemnity trust fund $240,000, which is statutorily appropriated, as provided in 17-7-502, from the renewable resource grant and loan program state special revenue account to support the operations of the environmental science-water quality instructional programs at Montana state university-northern, to be used for support costs, for matching funds necessary to attract additional funds to further expand statewide impact, and for enhancement of the facilities related to the programs.

(b)  At the beginning of each biennium, there is allocated from the interest income of the resource indemnity trust fund:

(i)  an amount not to exceed $175,000 to the environmental contingency account pursuant to the conditions of 75-1-1101;

(ii) an amount not to exceed $50,000 to the oil and gas production damage mitigation account pursuant to the conditions of 82-11-161;

(iii) beginning in fiscal year 1996, $2 million to be deposited into the renewable resource grant and loan program state special revenue account, created by 85-1-604, for the purpose of making grants;

(iv) beginning in fiscal year 1996, $3 million to be deposited into the reclamation and development grants state special revenue account, created by 90-2-1104, for the purpose of making grants; and

(v)  beginning in fiscal year 1996, $500,000 to be deposited into the water storage state special revenue account created by 85-1-631.

(c) At the beginning of each fiscal year, there is allocated from the interest income of the resource indemnity trust fund up to $200,000 to be deposited in the orphan share account established in [section 27].

(c)(d)  The remainder of the interest income is allocated as follows:

(i)  Thirty-six percent of the interest income of the resource indemnity trust fund must be allocated to the renewable resource grant and loan program state special revenue account created by 85-1-604.

(ii) Eighteen percent of the interest income of the resource indemnity trust fund must be allocated to the hazardous waste/CERCLA special revenue account provided for in 75-10-621.

(iii) Forty percent of the interest income from the resource indemnity trust fund must be allocated to the reclamation and development grants account provided for in 90-2-1104.

(iv) Six percent of the interest income of the resource indemnity trust fund must be allocated to the environmental quality protection fund provided for in 75-10-704.

(3)  Any formal budget document prepared by the legislature or the executive branch that proposes to appropriate funds from the resource indemnity trust interest account other than as provided for by the allocations in subsection (2) must specify the amount of money from each allocation that is proposed to be diverted and the proposed use of the diverted funds. A formal budget document includes a printed and publicly distributed budget proposal or recommendation, an introduced bill, or a bill developed during the legislative appropriation process or otherwise during a legislative session."



Section 4.  Section 75-2-412, MCA, is amended to read:

"75-2-412.   Criminal penalties -- injunction preserved. (1) A person is guilty of an offense under this section if that person knowingly:

(a)  violates a provision of this chapter or a rule, order, or permit made or issued under this chapter;

(b)  makes a false material statement, representation, or certification on a form required under this chapter or in a notice or report required by a permit under this chapter; or

(c)  renders inaccurate a monitoring device or method required under this chapter.

(2)  A person guilty of an offense under subsection (1) is subject to a fine of not more than $10,000 per violation or imprisonment for a period not to exceed 2 years, or both. This offense must be classified as a misdemeanor. Each day of each violation constitutes a separate violation.

(3)  Fines collected under this section, except fines collected by an approved local air pollution control program, must be deposited in the orphan share account in the state general special revenue fund.

(4)  Action under this section is not a bar to enforcement of this chapter or of a rule, order, or permit made or issued under it by injunction or other appropriate civil or administrative remedy. The department may institute and maintain in the name of the state any enforcement proceedings."



Section 5.  Section 75-2-413, MCA, is amended to read:

"75-2-413.   Civil penalties -- out-of-state litigants -- effect of action -- presumption of continuing violation under certain circumstances. (1) A person who violates any provision of this chapter, a rule adopted under this chapter, or any order or permit made or issued under this chapter is subject to a civil penalty not to exceed $10,000 per violation. Each day of each violation constitutes a separate violation. The department may institute and maintain in the name of the state any enforcement proceedings under this section. Upon request of the department, the attorney general or the county attorney of the county of violation shall petition the district court to impose, assess, and recover the civil penalty. The civil penalty is in lieu of the criminal penalty provided for in 75-2-412, except for civil penalties for violation of the operating permit program required by Subchapter V of the federal Clean Air Act.

(2)  (a)  Action under subsection (1) is not a bar to enforcement of this chapter or of a rule, order, or permit made or issued under this chapter by injunction or other appropriate civil remedies.

(b)  An action under subsection (1) or to enforce this chapter or a rule, order, or permit made or issued under this chapter may be brought in the district court of any county where a violation occurs or is threatened if the defendant cannot be located in Montana.

(3)  If the department has notified a person operating a commercial hazardous waste incinerator of a violation and if the department makes a prima facie showing that the conduct or events giving rise to the violations are likely to have continued or recurred past the date of notice, the days of violation are presumed to include the date of the notice and every day after the notice until the person establishes that continuous compliance has been achieved. This presumption may be overcome to the extent that the person operating a commercial hazardous waste incinerator can prove by a preponderance of evidence that there were intervening days when a violation did not occur, that the violation was not continuing in nature, or that the telemetering device was compromised or otherwise tampered with.

(4)  Money collected under this section must be deposited in the orphan share account in the state general special revenue fund. This subsection does not apply to money collected by an approved local air pollution control program."



Section 6.  Section 75-2-427, MCA, is amended to read:

"75-2-427.   Deposit of noncompliance penalty fees. All noncompliance penalties collected by the department pursuant to 75-2-421 through 75-2-429 shall must be deposited in the state special revenue fund until a final determination and adjustment have been made as provided in 75-2-424 and amounts have been deducted by the department for costs attributable to implementation of 75-2-421 through 75-2-429 and for contract costs incurred pursuant to 75-2-422(3), if any. After a final determination has been made and additional payments or refunds have been made, the penalty money remaining shall must be transferred to the orphan share account in the state general special revenue fund."



Section 7.  Section 75-3-407, MCA, is amended to read:

"75-3-407.   Civil penalties -- deposit in general fund -- injunctions not barred. (1) A person who violates this chapter or a rule or order issued under this chapter is subject to a civil penalty not to exceed $5,000 for each violation. For purposes of this section, each day of a violation is a separate violation.

(2)  The department shall initiate civil proceedings in district court to recover a penalty under subsection (1).

(3)  Civil penalties collected under this section must be deposited in the general orphan share account in the state special revenue fund.

(4)  An action under this section does not bar enforcement of this chapter or of rules or orders issued under it by injunction or other appropriate remedy."



Section 8.  Section 75-5-634, MCA, is amended to read:

"75-5-634.   Disposition of fines and civil penalties. Fines and civil penalties collected under this chapter, except those collected in a justice's court, must be deposited into the orphan share account in the state general special revenue fund."



Section 9.  Section 75-6-109, MCA, is amended to read:

"75-6-109.   Administrative enforcement. (1) If the department believes that a violation of this part, a rule adopted under this part, or a condition of approval issued under this part has occurred, it may serve written notice of the violation, by certified mail, on the alleged violator or the violator's agent. The notice must specify the provision of this part, the rule, or the condition of approval alleged to have been violated and the facts alleged to constitute a violation. The notice must include an order to take necessary corrective action within a reasonable period of time. The time period must be stated in the order. Service by mail is complete on the date of filing.

(2)  If the alleged violator does not request a hearing before the board within 30 days of the date of service, the order becomes final. Failure to comply with a final order may subject the violator to an action commenced pursuant to 75-6-104, 75-6-113, or 75-6-114.

(3)  If the alleged violator requests a hearing before the board within 30 days of the date of service, the board shall schedule a hearing. After the hearing is held, the board may:

(a)  affirm or modify the department's order issued under subsection (1) if the board finds that a violation has occurred; or

(b)  rescind the department's order if the board finds that a violation has not occurred.

(4)  An order issued by the department or the board may set a date by which the violation must cease and set a time limit for action to correct a violation.

(5)  As an alternative to issuing an order pursuant to subsection (1), the department may:

(a)  require the alleged violator to appear before the board for a hearing, at a time and place specified in the notice, to answer the charges complained of; or

(b)  initiate an action under 75-6-111(2), 75-6-113, or 75-6-114.

(6)  An action initiated under this part may include an administrative penalty not to exceed $500 for each day of violation. Administrative penalties collected under this section must be deposited in the orphan share account in the state general special revenue fund.

(7)  In determining the amount of penalty to be assessed to a person, the department or the board, as appropriate, shall consider the criteria stated in 75-6-114 and the rules promulgated under 75-6-103(2)(j).

(8)  The contested case provisions of the Montana Administrative Procedure Act, provided for in Title 2, chapter 4, part 6, apply to a hearing under 75-6-108 or this section."



Section 10.  Section 75-6-114, MCA, is amended to read:

"75-6-114.   Civil penalty. (1) In an action initiated by the department to collect civil penalties against a person who is found to have violated this part or a rule, order, or condition of approval issued under this part, the person is subject to a civil penalty not to exceed $10,000.

(2)  Each day of violation constitutes a separate violation.

(3)  Action under this section does not bar enforcement of this part or a rule, order, or condition of approval issued under this part by injunction or other appropriate remedy.

(4)  When seeking penalties under this section, the department shall take into account the following factors in determining an appropriate settlement or judgment, as appropriate:

(a)  the nature, circumstances, extent, and gravity of the violation; and

(b)  with respect to the violator, the violator's ability to pay, prior history of violations, the economic benefit or savings, if any, to the violator resulting from the violator's action, the amounts voluntarily expended by the violator to address or mitigate the violation or impacts of the violation to waters of the state, and other matters that justice may require.

(5)  Civil penalties collected pursuant to this section must be deposited in the orphan share account in the state general special revenue fund."



Section 11.  Section 75-10-417, MCA, is amended to read:

"75-10-417.   Civil penalties. (1) Any person who violates any provision of this part, a rule adopted under this part, an order of the department or the board, or a permit is subject to a civil penalty not to exceed $10,000 per violation. Each day of violation constitutes a separate violation.

(2)  The department may institute and maintain in the name of the state any enforcement proceedings under this section. Upon request of the department, the attorney general or the county attorney of the county of violation shall petition the district court to impose, assess, and recover the civil penalty.

(3)  Action under this section does not bar:

(a)  enforcement of this part, rules adopted under this part, orders of the department or the board, or permits by injunction or other appropriate remedy; or

(b)  action under 75-10-418.

(4)  Money collected under this section shall must be deposited in the orphan share account in the state general special revenue fund."



Section 12.  Section 75-10-418, MCA, is amended to read:

"75-10-418.   Criminal penalties. (1) A person is guilty of an offense under this section if the person knowingly:

(a)  transports any hazardous waste to an unpermitted facility;

(b)  treats, stores, or disposes of hazardous waste subject to regulation under this part or the rules adopted under this part without a permit or contrary to a material permit condition;

(c)  omits material information or makes any false statement or representation in any application, label, manifest, record, report, permit, or other document filed, maintained, or used for compliance with provisions of this part or rules adopted under this part pertaining to the handling of hazardous waste;

(d)  generates, stores, treats, transports, disposes of, or otherwise handles any used oil or hazardous waste regulated under this part or rules adopted under this part and knowingly destroys, alters, conceals, or fails to file any record, application, manifest, report, or other document required to be maintained or filed in compliance with the provisions of this part, an order issued under this part, or rules adopted under this part; or

(e)  transports or causes to be transported without a manifest any hazardous waste required to be accompanied by a manifest.

(2)  A person who is guilty of an offense under subsection (1) is subject to a fine of not more than $25,000 per violation or imprisonment for a period not to exceed 3 years, or both. Each day of violation constitutes a separate violation.

(3)  A person who knowingly violates any requirement of this part or any rule or material permit condition issued pursuant to this part, (except those violations specified in subsection (1)), regarding any hazardous waste that is subject to regulation is guilty of an offense and subject to a fine of up to $5,000 per violation or subject to imprisonment not to exceed 6 months, or both. Each day of violation constitutes a separate violation.

(4)  Upon a second conviction for a violation of this section, the maximum penalties specified in this section must be doubled.

(5)  Action under this section does not bar enforcement of this part, rules made under this part, orders of the department or the board, or permits by injunction or other appropriate remedy.

(6)  Money collected under this section, except money collected in a justice's court, must be deposited in the orphan share account in the state general special revenue fund."



Section 13.  Section 75-10-423, MCA, is amended to read:

"75-10-423.   Administrative penalties for underground storage tank violations -- appeals -- venue for hearings. (1) A person who violates any of the underground storage tank provisions of this chapter or any underground storage tank rules promulgated under the authority of this chapter may be assessed and ordered by the department to pay an administrative penalty not to exceed $500 per violation. This limitation on administrative penalties applies only to penalties assessed under this section. Each occurrence of the violation and each day it remains uncorrected constitutes a separate violation. The department may suspend a portion of the administrative penalty assessed under this section if the condition that caused the assessment of the penalty is corrected within a specified time. Assessment of an administrative penalty under this section may be made in conjunction with any order or other administrative action authorized by Title 75, chapter 11, or by this chapter.

(2)  When the department assesses an administrative penalty under this section, it must have written notice served personally or by certified mail on the alleged violator or the violator's agent. For purposes of this chapter, service by mail is complete on the day of receipt. The notice must state:

(a)  the provision alleged to be violated;

(b)  the facts alleged to constitute the violation;

(c)  the amount of the administrative penalty assessed under this section;

(d)  the amount, if any, of the penalty to be suspended upon correction of the condition that caused the assessment of the penalty;

(e)  the nature of any corrective action the department requires, whether or not a portion of the penalty is to be suspended;

(f)  as applicable, the time within which the corrective action is to be taken and the time within which the administrative penalty is to be paid;

(g)  the right to appeal or to a hearing to mitigate the penalty assessed and the time, place, and nature of any hearing; and

(h)  that a formal proceeding may be waived.

(3)  The department shall provide each person assessed a penalty under this section an opportunity for a hearing to either contest the alleged violation or request mitigation of the penalty. The contested case provisions of the Montana Administrative Procedure Act, provided for in Title 2, chapter 4, part 6, apply to a hearing conducted under this section. If a hearing is held under this section, it must be held in Lewis and Clark County or the county where the alleged violation occurred. This subsection does not apply until the department gives written notice, served personally or by certified mail, to the alleged violator or the violator's agent. For the purposes of this chapter, service by mail is complete on the day of receipt. The notice must state:

(a)  the provision allegedly violated;

(b)  the facts that constitute the alleged violation;

(c)  the specific nature of any corrective action the department requires, estimated costs of compliance with the action, and where to receive help to correct the alleged violation; and

(d)  a timetable that a reasonable person would consider appropriate for compliance with the alleged violations.

(4)  The department shall publish a schedule of maximum and minimum penalties for specific violations. In determining appropriate penalties for violations, the department shall consider the gravity of the violations and the potential for significant harm to public health or the environment. In determining the appropriate amount of penalty, if any, to be suspended upon correction of the condition that caused the penalty assessment, the department shall consider the cooperation and the degree of care exercised by the person assessed the penalty, how expeditiously the violation was corrected, and whether significant harm resulted to the public health or the environment from the violation.

(5)  If the department is unable to collect an administrative penalty assessed under this section or if a person fails to pay all or any portion of an administrative penalty assessed under this section, the department may take action in district court to recover the penalty amount and any additional amounts assessed or sought under Title 75, chapter 11, or this chapter.

(6)  Action under this section does not bar action under Title 75, chapter 11, or this chapter, or any other remedy available to the department for violations of underground storage tank laws or rules promulgated under those laws.

(7)  Administrative penalties collected under this section must be deposited in the orphan share account in the state general special revenue fund."



Section 14.  Section 75-10-424, MCA, is amended to read:

"75-10-424.   Administrative penalty. (1) The department may assess a person who violates a used oil or hazardous waste provision of this part, or a used oil or hazardous waste rule adopted under this part, an administrative penalty, not to exceed $10,000 per violation. Each day of violation constitutes a separate violation, but the maximum penalty may not exceed $100,000 for any related series of violations. Assessment of an administrative penalty under this section must be made in conjunction with an order or administrative action authorized by this chapter.

(2)  An administrative penalty may not be assessed under this section unless the alleged violator is given notice and opportunity for a hearing before the board pursuant to Title 2, chapter 4, part 6.

(3)  In determining the appropriate amount of an administrative penalty, the department shall consider:

(a)  the gravity and the number of violations;

(b)  the degree of care exercised by the alleged violator;

(c)  whether significant harm resulted to public health or the environment; and

(d)  the degree of potential significant harm to public health or the environment.

(4)  If the department is unable to collect the administrative penalty or if a person fails to pay all or any portion of the administrative penalty as determined by the department, the department may seek to recover the amount in an appropriate district court.

(5)  Action under this section does not bar action under 75-10-413 through 75-10-418 or any other appropriate remedy.

(6)  Administrative penalties collected under this section must be deposited in the orphan share account in the state general special revenue fund."



Section 15.  Section 75-10-542, MCA, is amended to read:

"75-10-542.   Penalties. (1) A person who willfully violates this part, except 75-10-520, is guilty of a misdemeanor and upon conviction shall be fined not to exceed $250, imprisoned in the county jail for a term not to exceed 30 days, or both.

(2)  A person who violates this part, except 75-10-520, a rule of the department, or an order issued as provided in this part shall be is subject to a civil penalty of not more than $50. Each day upon which a violation of this part or a rule or order occurs is a separate violation.

(3) Civil penalties collected under this section must be deposited in the orphan share account in the state special revenue fund."



Section 16.  Section 75-10-701, MCA, is amended to read:

"75-10-701.   Definitions. As used in this part, unless the context requires otherwise, the following definitions apply:

(1)  "Department" means the department of environmental quality provided for in 2-15-3501.

(2)  "Director" means the director of the department.

(3)  "Environment" means any surface water, ground water, drinking water supply, land surface or subsurface strata, or ambient air within the state of Montana or under the jurisdiction of the state of Montana.

(4)  (a) "Facility" means:

(i)  any building, structure, installation, equipment, pipe or pipeline (including any pipe into a sewer or publicly owned treatment works), well, pit, pond, lagoon, impoundment, ditch, landfill, storage container, motor vehicle, rolling stock, or aircraft; or

(ii) any site or area where a hazardous or deleterious substance has been deposited, stored, disposed of, placed, or otherwise come to be located.

(b)  The term does not include any consumer product in consumer use.

(5)  "Fiduciary" means a trustee, executor, administrator, personal representative, custodian, conservator, guardian, or receiver acting or holding property for the exclusive benefit of another person. The term does not include:

(a)  a person who has previously owned or operated the property in a nonfiduciary capacity; or

(b)  a person acting as fiduciary with respect to a trust or other fiduciary estate that has no objectively reasonable or substantial purpose apart from avoidance of or limitation of liability under this part. For the purposes of 75-10-715(7)(9), the term does not include the state, a state agency, or a political subdivision of the state acting as trustee of natural resources within the state of Montana.

(6)  "Foreclosure" means acquisition of title to property through foreclosure, purchase at foreclosure sale, assignment or acquisition of title in lieu of foreclosure, repossession in the case of a lease financing transaction, or acquisition of a right to title or other agreement in full or partial settlement of a loan obligation.

(7)  "Fund" means the environmental quality protection fund established in 75-10-704.

(8)  "Hazardous or deleterious substance" means a substance that because of its quantity, concentration, or physical, chemical, or infectious characteristics may pose an imminent and substantial threat to public health, safety, or welfare or the environment and is:

(a)  a substance that is defined as a hazardous substance by section 101(14) of the federal Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42 U.S.C. 9601(14), as amended;

(b)  a substance identified by the administrator of the United States environmental protection agency as a hazardous substance pursuant to section 102 of CERCLA, 42 U.S.C. 9602, as amended;

(c)  a substance that is defined as a hazardous waste pursuant to section 1004(5) of the Resource Conservation and Recovery Act of 1976, 42 U.S.C. 6903(5), as amended, including a substance listed or identified in 40 CFR 261; or

(d)  any petroleum product.

(9) "Household" means single and multiple residences, hotels and motels, bunkhouses, ranger stations, crew quarters, campgrounds, picnic grounds, day-use recreational areas, or similar structures or areas.

(10) "Household refuse" means garbage, trash, and sanitary wastes in septic tanks that are derived from a household.

(9)(11)  "Natural resources" means land, fish, wildlife, biota, air, surface water, ground water, drinking water supplies, and any other resources within the state of Montana owned, managed, held in trust, or otherwise controlled by or appertaining to the state of Montana or a political subdivision of the state.

(12) "Orphan share" means the percentage share of remedial action costs for a facility that is attributable, under the procedures in [sections 26 through 36], to identified but bankrupt or defunct persons who are not affiliated with any viable person.

(13) "Orphan share fund" means the fund for the orphan share account established in [section 27].

(10)(14) (a) "Owns or operates" means owning, leasing, operating, managing activities at, or exercising control over the operation of a facility.

(b)  The term does not include holding the indicia of ownership of a facility primarily to protect a security interest in the facility or other location unless the holder has participated in the management of the facility. The term does not apply to the state or a local government that acquired ownership or control through bankruptcy, tax delinquency, abandonment, lien foreclosure, or other circumstances in which the government acquires title by virtue of its function as sovereign, unless the state or local government has caused or contributed to the release or threatened release of a hazardous or deleterious substance from the facility. The term also does not include the owner or operator of the Milltown dam licensed under part 1 of the Federal Power Act (FERC license No. 2543-004) if a hazardous or deleterious substance has been released into the environment upstream of the dam and has subsequently come to be located in the reservoir created by the dam, unless the owner or operator is a person who would otherwise be liable for a release or threatened release under 75-10-715(1).

(11)(15) "Person" means an individual, trust, firm, joint-stock company, joint venture, consortium, commercial entity, partnership, association, corporation, commission, state or state agency, political subdivision of the state, interstate body, or the federal government, including a federal agency.

(12)(16) "Petroleum product" includes gasoline, crude oil (except for crude oil at production facilities subject to regulation under Title 82), fuel oil, diesel oil or fuel, lubricating oil, oil sludge or refuse, and any other petroleum-related petroleum related product or waste or fraction of the product or waste that is liquid at standard conditions of temperature and pressure (60 degrees F and 14.7 pounds per square inch absolute).

(13)(17) "Reasonably anticipated future uses" means likely future land or resource uses that take into consideration:

(a)  local land and resource use regulations, ordinances, restrictions, or covenants;

(b)  historical and anticipated uses of the facility;

(c)  patterns of development in the immediate area; and

(d)  relevant indications of anticipated land use from the owner of the facility and local planning officials.

(14)(18) "Release" means any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing of a hazardous or deleterious substance directly into the environment (including the abandonment or discarding of barrels, containers, and other closed receptacles containing any hazardous or deleterious substance), but excludes releases confined to the indoor workplace environment, the use of pesticides as defined in 80-8-102(30) when they are applied in accordance with approved federal and state labels, and the use of commercial fertilizers, as defined in 80-10-101(2), when applied as part of accepted agricultural practice.

(15)(19) "Remedial action" includes all notification, investigation, administration, monitoring, cleanup, restoration, mitigation, abatement, removal, replacement, acquisition, enforcement, legal action, health studies, feasibility studies, and other actions necessary or appropriate to respond to a release or threatened release.

(16)(20) "Remedial action contract" means a written contract or agreement entered into by a remedial action contractor with the state, or with a potentially liable person acting pursuant to an order or request issued by the department, the United States, or any federal agency, to provide a remedial action with respect to a release or threatened release of a hazardous or deleterious substance.

(17)(21) "Remedial action contractor" means:

(a)  any person who enters into and is carrying out a remedial action contract; or

(b)  any person who is retained or hired by a person described in subsection (17)(a) (21)(a) to provide services relating to a remedial action.

(18)(22) "Remedial action costs" means reasonable costs that are attributable to or associated with a remedial action at a facility, including but not limited to the costs of administration, investigation, legal or enforcement activities, contracts, feasibility studies, or health studies."



Section 17.  Section 75-10-702, MCA, is amended to read:

"75-10-702.   Rulemaking authority. (1) The department is authorized to adopt rules for the implementation of this part, including but not limited to:

(a) rules for listing and delisting facilities on a priority list, required by 75-10-704, based on the following criteria:

(i) a facility eligible for listing must have a confirmed release or substantial threat of a release of a hazardous or deleterious substance that may pose an imminent and substantial threat to public health, safety, or welfare or the environment and the department shall provide a written description of the nature and severity of the threat;

(ii) if remedial actions to address the hazardous or deleterious substances are required at the facility by another state program, the department shall explain, in writing, its rationale for listing the facility;

(iii) listing and delisting must be done through a formal process that provides for public participation, including participation of the affected or potentially liable persons in the decisionmaking process, by conducting GIVING PUBLIC NOTICE AND PROVIDING OPPORTUNITY FOR at least one public meeting in the community most likely to be threatened by the facility that is proposed for listing or delisting; and

(iv) a facility must be delisted when another state program assumes jurisdiction or when further remedial actions are not necessary;

(b) rules for establishing and implementing a system for prioritizing facilities, including categories for maximum and high-priority facilities, as required by 75-10-704, and for remedial action based on potential effects on human health and the environment.

(2) The rulemaking authority granted in subsection (1) may not invalidate the existing priorities list. Rules promulgated pursuant to subsection (1) must provide for the reevaluation of facilities on the existing priorities list. A decision by the department to list, delist, or establish a priority for a facility must be made in writing."



Section 18.  Section 75-10-704, MCA, is amended to read:

"75-10-704.   Environmental quality protection fund. (1) There is in the state special revenue fund an environmental quality protection fund to be administered as a revolving fund by the department. The department is authorized to expend amounts from the fund necessary to carry out the purposes of this part.

(2)  The fund may be used by the department only to carry out the provisions of this part and for remedial actions taken by the department pursuant to this part in response to a release of hazardous or deleterious substances.

(3)  The department shall:

(a)  except as provided in subsection (7), establish and implement a system, including the preparation of a priority list, for prioritizing sites for remedial action based on potential effects on human health and the environment; and

(b)  investigate, negotiate, and take legal action, as appropriate, to identify liable persons, to obtain the participation and financial contribution of liable persons for the remedial action, to achieve remedial action, and to recover costs and damages incurred by the state.

(4)  There must be deposited in the fund:

(a)  all penalties, forfeited financial assurance, natural resource damages, and remedial action costs recovered pursuant to 75-10-715;

(b)  all administrative penalties assessed pursuant to 75-10-714 and all civil penalties assessed pursuant to 75-10-711(5);

(c)  funds appropriated to the fund by the legislature; and

(d)  funds received from the interest income of the resource indemnity trust fund pursuant to 15-38-202;

(e) funds received from the interest income of the fund; and

(f) funds received from settlements pursuant to 75-10-719(7).

(5)  Whenever a legislative appropriation is insufficient to carry out the provisions of this part and additional money remains in the fund, the department shall seek additional authority to spend money from the fund through the budget amendment process provided for in Title 17, chapter 7, part 4.

(6)  Whenever the amount of money in the fund is insufficient to carry out remedial action, the department may apply to the governor for a grant from the environmental contingency account established pursuant to 75-1-1101.

(7)  (a) There is established a state special revenue account for all funds donated or granted from private parties to remediate a specific release at a specific facility. There must be deposited into the account the interest income earned on the account. A person is not liable under 75-10-715 solely as a result of contributing to this account.

(b)  Funds donated or granted for a specific project pursuant to this subsection (7) must be accumulated in the fund until the balance of the donated or granted funds is sufficient, as determined by the department, to remediate the facility pursuant to the requirements of 75-10-721 for which the funds are donated.

(c)  If the balance of the fund created in this subsection (7), as determined by the department pursuant to the requirements of 75-10-721, is not sufficient to remediate the facility within 1 year from the date of the initial contribution, all donated or granted funds, including any interest on those donated or granted funds, must be returned to the grantor.

(d)  If the balance for a specific project is determined by the department to be sufficient to remediate the facility pursuant to the requirements of 75-10-721, the department shall give that site high priority for remedial action, using the funds donated under this subsection (7).

(e)  This subsection (7) is not intended to interfere with or to diminish the authority or actions of the department to investigate, negotiate, and take legal action, as appropriate, to identify liable persons, to obtain the participation and financial contribution of liable persons for the remedial action, to achieve remedial action, and to recover costs and damages incurred by the state. Subsections (7) and (8) do not pertain to facilities where the department has initiated actions under this part.

(f)  The department shall expend the funds in a manner that maximizes the application of the funds to physically remediating the specific release.

(8) (a) A person may donate in-kind services to remediate a specific release at a specific facility pursuant to subsection (7). A person that donates in-kind services is not liable under 75-10-715 solely as a result of the contribution of in-kind services.

(b)  A person who donates in-kind services with respect to remediating a specific release at a specific facility is not liable under this part to any person for injuries, costs, damages, expenses, or other liability that results from the release or threatened release, including but not limited to claims for indemnification or contribution and claims by third parties for death, personal injury, illness, loss of or damage to property, or economic loss.

(c)  Immunity from liability, pursuant to subsection (8)(b), does not apply in the case of a release that is caused by conduct of the entity providing in-kind services that is negligent or grossly negligent or that constitutes intentional misconduct.

(d)  This subsection does not minimize the liability, lessen the standard of liability, or otherwise shield from liability a potentially liable person under 75-10-715 or section 107 of CERCLA for costs or damages incurred as a result of a release or threatened release of a hazardous or deleterious substance.

(e)  Any donated in-kind services that are employed as part of a remedial action pursuant to this subsection (8) must be approved by the department as appropriate remedial action."



Section 19.  Section 75-10-715, MCA, is amended to read:

"75-10-715.   Liability -- reimbursement and penalties -- proceedings -- defenses and exclusions. (1) Except as provided in [sections 26 through 36], notwithstanding Notwithstanding any other provision of law, and subject only to the defenses set forth in subsection (5) and the exclusions set forth in subsection (7), the following persons are jointly and severally liable for a release or threatened release of a hazardous or deleterious substance from a facility:

(a)  a person who owns or operates a facility where a hazardous or deleterious substance was disposed of;

(b)  a person who at the time of disposal of a hazardous or deleterious substance owned or operated a facility where the hazardous or deleterious substance was disposed of;

(c)  a person who generated, possessed, or was otherwise responsible for a hazardous or deleterious substance and who, by contract, agreement, or otherwise, arranged for disposal or treatment of the substance or arranged with a transporter for transport of the substance for disposal or treatment; and

(d)  a person who accepts or has accepted a hazardous or deleterious substance for transport to a disposal or treatment facility.

(2)  A person identified in subsection (1) is liable for the following costs:

(a)  all remedial action costs incurred by the state; and

(b)  damages for injury to, destruction of, or loss of natural resources caused by the release or threatened release, including the reasonable technical and legal costs of assessing and enforcing a claim for the injury, destruction, or loss resulting from the release, unless the impaired natural resources were specifically identified as an irreversible and irretrievable commitment of natural resources in an approved final state or federal environmental impact statement or other comparable approved final environmental analysis for a project or facility that was the subject of a governmental permit or license and the project or facility was being operated within the terms of its permit or license.

(3)  If the person liable under subsection (1) fails, without sufficient cause, to comply with a department order issued pursuant to 75-10-711(4) or to properly provide remedial action upon notification by the department pursuant to 75-10-711(3), the person may be liable for penalties in an amount not to exceed two times the amount of any costs incurred by the state pursuant to this section.

(4)  The department may initiate civil proceedings in district court to recover remedial action costs, natural resource damages, or penalties under subsections (1), (2), and (3). Proceedings to recover costs and penalties must be conducted in accordance with 75-10-722. Venue for any action to recover costs, damages, or penalties lies in the county where the release occurred or where the person liable under subsection (1) resides or has its principal place of business or in the district court of the first judicial district.

(5)  A person has a defense and is not liable under subsections (1), (2), and (3) if the person can establish by a preponderance of the evidence that:

(a)  the department failed to follow the notice provisions of 75-10-711 when required;

(b)  the release did not emanate from any vessel, vehicle, or facility to which the person contributed any hazardous or deleterious substance or over which the person had any ownership, authority, or control and was not caused by any action or omission of the person;

(c)  the release or threatened release occurred solely as a result of:

(i)  an act or omission of a third party other than either an employee or agent of the person; or

(ii) an act or omission of a third party other than one whose act or omission occurs in connection with a contractual relationship, existing directly or indirectly, with the person, if the person establishes by a preponderance of the evidence that the person:

(A)  exercised due care with respect to the hazardous or deleterious substance concerned, taking into consideration the characteristics of the hazardous or deleterious substance in light of all relevant facts and circumstances; and

(B)  took precautions against foreseeable acts or omissions of a third party and the consequences that could foreseeably result from those acts or omissions;

(d)  the release or threat of release occurred solely as the result of an act of God or an act of war;

(e)  the release or threatened release was from a facility for which a permit had been issued by the department, the hazardous or deleterious substance was specifically identified in the permit, and the release was within the limits allowed in the permit;

(f)  in the case of assessment of penalties under subsection (3), factors beyond the control of the person prevented the person from taking timely remedial action; or

(g)  the person accepted transported only household refuse (garbage, trash, or septic tank sanitary wastes generated by single or multiple residences, hotels, motels, restaurants, or similar facilities) for transport to a solid waste disposal facility, unless that person knew or reasonably should have known that the hazardous or deleterious substance was present in the refuse.

(6)  (a) For the purpose of subsection (5)(c)(ii), the term "contractual relationship" includes but is not limited to land contracts, deeds, or other instruments transferring title or possession, unless the real property on which the facility is located was acquired by the person after the disposal or placement of the hazardous or deleterious substance on, in, or at the facility and one or more of the following circumstances is also established by the person by a preponderance of the evidence:

(i)  At the time the person acquired the facility, the person did not know and had no reason to know that a hazardous or deleterious substance that is the subject of the release or threatened release was disposed of on, in, or at the facility.

(ii) The person is a governmental entity that acquired the facility by escheat, lien foreclosure, or through any other involuntary transfer or acquisition or through the exercise of eminent domain authority by purchase or condemnation.

(iii) The person acquired the facility by inheritance or bequest.

(b)  In addition to establishing one or more of the circumstances in subsection (6)(a)(i) through (6)(a)(iii), the person shall establish that the person has satisfied the requirements of subsection (5)(c)(i) or (5)(c)(ii).

(c)  To establish that the person had no reason to know, as provided in subsection (6)(a)(i), the person must have undertaken, at the time of acquisition, all appropriate inquiry into the previous ownership and uses of the property consistent with good commercial or customary practice in an effort to minimize liability. For purposes of assessing this inquiry, the following must be taken into account:

(i)  any specialized knowledge or experience on the part of the person;

(ii) the relationship of the purchase price to the value of the property if uncontaminated;

(iii) commonly known or reasonably ascertainable information about the property;

(iv) the obviousness of the presence or the likely presence of contamination on the property; and

(v)  the ability to detect the contamination by appropriate inspection.

(d)  (i) Nothing in subsections Subsections (5)(b) and (5)(c) or in this subsection (6) may not diminish the liability of a previous owner or operator of the facility who would otherwise be liable under this part.

(ii) Notwithstanding this subsection (6), if the previous owner or operator obtained actual knowledge of the release or threatened release of a hazardous or deleterious substance at the facility when the person owned the real property and then subsequently transferred ownership of the property to another person without disclosing the knowledge, the previous owner is liable under subsections (1), (2), and (3) and no a defense under subsection (5)(b) or (5)(c) is not available to that person.

(e)  Nothing in this subsection Subsection (6) affects does not affect the liability under this part of a person who, by any act or omission, caused or contributed to the release or threatened release of a hazardous or deleterious substance that is the subject of the action relating to the facility.

(7) A person has an exclusion and is not liable under this section if:

(a) the person generated or disposed of only household refuse, unless the person knew or reasonably should have known that the hazardous or deleterious substance was present in the refuse;

(b) the person owns or operates real property where hazardous or deleterious substances have come to be located solely as a result of subsurface migration in an aquifer from a source or sources outside the person's property, provided that the following conditions are met:

(i) the owner or operator did not cause, contribute to, or exacerbate the release or threatened release of any hazardous or deleterious substances through any act or omission. The failure to take affirmative steps to mitigate or address contamination that has migrated from a source outside the owner's or operator's property does not, in the absence of exceptional circumstances, constitute an omission by the owner or operator.

(ii) the person who caused, contributed to, or exacerbated the release or threatened release of any hazardous or deleterious substance is not and was not an agent or employee of the owner or operator and is not or was not in a direct or indirect contractual relationship with the owner or operator, unless the department provides a written determination that an existing or proposed contractual relationship is an insufficient basis to establish liability under this section;

(iii) there is no other basis of liability under subsection (1) for the owner or operator for the release or threatened release of a hazardous or deleterious substance; and

(iv) the owner or operator cooperates with the department and all persons conducting department-approved remedial actions on the property, including granting access and complying with and implementing all required institutional controls;

(c) the person owns or occupies real property of 20 acres or less for residential purposes, provided that the following conditions are met:

(i) the person did not cause, contribute to, or exacerbate the release or threatened release of any hazardous or deleterious substance through any act or omission;

(ii) the person uses or allows the use of the real property for residential purposes. This exclusion does not apply to any person who acquires or develops real property for commercial use or any use other than residential use.

(iii) at the time the person purchased or occupied the real property, there were no visible indications of contamination on the surface of the real property;

(iv) the person cooperates with the department and all persons conducting department-approved remedial actions on the property, including granting access and complying with and implementing all required institutional controls; and

(v) there is no other basis of liability under subsection (1) for the owner or occupier for the release or threatened release of a hazardous or deleterious substance.

(8) A person is liable under this section if the department provides substantial credible evidence that the person fails to satisfy any element of each exclusion in subsections (7)(a) through (7)(c).

(7)(9)  The liability of a fiduciary under the provisions of this part for a release or a threatened release of a hazardous or deleterious substance from a facility held in a fiduciary capacity may not exceed the assets held in the fiduciary capacity that are available to indemnify the fiduciary unless the fiduciary is liable under this part independent of the person's ownership or actions taken in a fiduciary capacity.

(8)(10)  A person who holds indicia of ownership in a facility primarily to protect a security interest is not liable under subsections (1)(a) and (1)(b) for having participated in the management of a facility within the meaning of 75-10-701(10)(b)(14)(b) because of any one or any combination of the following:

(a)  holding an interest in real or personal property when the interest is being held as security for payment or performance of an obligation, including but not limited to a mortgage, deed of trust, lien, security interest, assignment, pledge, or other right or encumbrance against real or personal property that is furnished by the owner to ensure repayment of a financial obligation;

(b)  requiring or conducting financial or environmental assessments of a facility or a portion of a facility, making financing conditional upon environmental compliance, or providing environmental information or reports;

(c)  monitoring the operations conducted at a facility or providing access to a facility to the department or its agents or to remedial action contractors;

(d)  having the mere capacity or unexercised right to influence a facility's management of hazardous or deleterious substances;

(e)  giving advice, information, guidance, or direction concerning the administrative and financial aspects, as opposed to day-to-day operational aspects, of a borrower's operations;

(f)  providing general information concerning federal, state, or local laws governing the transportation, storage, treatment, and disposal of hazardous or deleterious substances and concerning the hiring of remedial action contractors;

(g)  engaging in financial workouts, restructuring, or refinancing of a borrower's obligations;

(h)  collecting rent, maintaining utility services, securing a facility from unauthorized entry, or undertaking other activities to protect or preserve the value of the security interest in a facility;

(i)  extending or denying credit to a person owning or in lawful possession of a facility;

(j)  in an emergency, requiring or undertaking activities to prevent exposure of persons to hazardous or deleterious substances or to contain a release;

(k)  requiring or conducting remedial action in response to a release or threatened release if prior notice is given to the department and the department approves of the remedial action; or

(l)  taking title to a facility by foreclosure, provided that the holder of indicia of ownership, from the time the holder acquires title, undertakes to sell, re-lease property held pursuant to a lease financing transaction (whether by a new lease financing transaction or substitution of the lessee), or otherwise divest itself of the property in a reasonably expeditious manner, using whatever commercially reasonable means are relevant or appropriate with respect to the facility and taking all facts and circumstances into consideration and provided that the holder does not:

(i)  outbid or refuse a bid for fair consideration for the property or outbid or refuse a bid that would effectively compensate the holder for the amount secured by the facility;

(ii) worsen the contamination at the facility;

(iii) incur liability under subsection (1)(c) or (1)(d) by arranging for disposal of or transporting hazardous or deleterious substances; or

(iv) engage in conduct described in subsection (9) (11).

(9)(11)  The protection from liability provided in subsections (7) (9) and (8) (10) is not available to a fiduciary or to a person holding indicia of ownership primarily to protect a security interest if the fiduciary or person through affirmative conduct:

(a)  causes or contributes to a release of hazardous or deleterious substances from the facility;

(b)  allows others to cause or contribute to a release of hazardous or deleterious substances; or

(c)  in the case of a person holding indicia of ownership primarily to protect a security interest, actually participates in the management of a facility by:

(i)  exercising decisionmaking control over environmental compliance; or

(ii) exercising control at a level comparable to that of a manager of the enterprise with responsibility for day-to-day decisionmaking either with respect to environmental compliance or substantially all of the operational, as opposed to financial or administrative, aspects of the facility."



Section 20.  Section 75-10-719, MCA, is amended to read:

"75-10-719.   Settlement -- bar to contribution liability. (1) A person who has resolved his that person's liability to the state arising under 75-10-715 or section 107(a)(1) through (a)(4) of CERCLA, 42 U.S.C. 9607(a)(1) through (a)(4), in an administrative or judicially approved settlement is not liable for claims for contribution regarding matters addressed in the settlement. The settlement does not discharge any of the other potentially liable persons unless its terms provide a discharge. The terms of the settlement may reduce the potential liability of the other potentially liable persons by the amount of the settlement.

(2)  If the state has obtained less than complete relief from a person who has resolved his that person's liability to the state in an administrative or judicially approved settlement, the state may bring an action against any other person who has not resolved his that person's liability.

(3)  A person who has resolved, in whole or in part, his that person's liability to the state for the release or for remedial action costs in an administrative or judicially approved settlement may seek contribution from a person who is not party to a settlement referred to in subsection (1).

(4)  Whenever practicable and in the public interest, as determined by the director of the department, the department may, as promptly as possible, reach a final settlement with a potentially liable or liable person liable under 75-10-715 in an administrative or civil action under 75-10-711 if the settlement involves only a minor portion of the response remedial action costs at the facility concerned and, in the judgment of the department, taking into account the toxicity of the hazardous or deleterious substances involved and the person's contribution of hazardous or deleterious substances in relation to the total volume of hazardous or deleterious substances at the facility, the conditions in either any of the following subsection subsections (4)(a) or (4)(b) through (4)(d) are met:

(a)  Both of the following are minimal in comparison to other hazardous or deleterious substances at the facility:

(i)  the amount of the hazardous or deleterious substances contributed by that person to the facility;

(ii) the toxic or other hazardous effects of the substances contributed by that person to the facility. the person is one whose liability is based solely on 75-10-715(1)(c) or (1)(d) and who presents substantial credible evidence that the person contributed less than 0.002% of the total volume or less than 100 gallons or 200 pounds of materials containing hazardous or deleterious substances at a facility that received hazardous or deleterious substances from multiple contributors. The department may not require the payment of remedial action costs from this person.

(b) (i) the person is one whose liability is based solely on 75-10-715(1)(c) or (1)(d) and who presents substantial credible evidence that the person arranged for disposal or treatment of less than 5% of the total quantity of solid waste or hazardous or deleterious substances disposed of at a facility that received solid waste or hazardous or deleterious substances from multiple contributors.

(ii) For the purposes of subsection (5)(a) and this subsection (4)(b) only, the term "solid waste" means:

(A) all putrescible and nonputrescible wastes, including garbage, rubbish, refuse, or ashes;

(B) sludge from sewage treatment plants, water supply plants, or air pollution control facilities;

(C) construction and demolition wastes;

(D) dead animals, including offal;

(E) discarded home and industrial appliances; and

(F) wood products or wood byproducts and inert materials.

(b)(c)  (i) The the person:

(A)  is the owner of the real property on or in which the facility is located;

(B)  did not conduct or permit the generation, transportation, storage, treatment, or disposal of any hazardous or deleterious substance at the facility; and

(C)  did not contribute to the release or threat of release of a hazardous or deleterious substance at the facility through any action or omission.

(ii) This subsection (4)(b) (4)(c) does not apply if the person purchased the real property with actual or constructive knowledge that the property was used for the generation, transportation, storage, treatment, or disposal of any hazardous or deleterious substance.

(d) the person presents substantial credible evidence that the person has a defense under 75-10-715(5).

(5) When reaching a settlement under subsection (4)(b), (4)(c), or (4)(d), the department may require the payment of remedial action costs not to exceed two times the person's reasonably projected liability for remedial action costs as determined by the department. Except as provided in subsection (6), the settlement must contain a reservation of rights clause in the event that the department obtains new information showing that the settling person no longer qualifies for a settlement because:

(a) the solid waste or hazardous or deleterious substances contributed by the person was of a greater volume or toxicity than originally estimated; or

(b) the settlement was reached under subsection (4)(c) and, after settlement, the department finds that the person had actual or constructive knowledge that the property was used for the generation, transportation, storage, treatment, or disposal of any hazardous or deleterious substance.

(6) A person who agrees to a liability settlement may avoid the reservation of rights clause under subsection (5) by paying remedial action costs in the amount of four times the person's reasonably projected liability for remedial action costs as determined by the department.

(7) All funds received as a result of settlements under this section must be paid in the following order of priority:

(a) to the department as reimbursement for its remedial action costs at the facility;

(b) to liable persons as reimbursement for remedial action costs at the facility. In the event of an allocation under [sections 26 through 36], the reimbursement must be in proportion to each liable person's share of liability as determined under the provisions of [section 34 or 35];

(c) the remainder, if any:

(i) to the orphan share fund provided in [section 27] if the facility went through the allocation process provided in [sections 26 through 36]; or

(ii) to the fund provided in 75-10-704 if the facility did not undergo the allocation process provided in [sections 26 through 36].

(8) Any person who enters into a settlement under this section may not be subject to or assigned a share in the allocation process provided in [sections 26 through 36].

(5)(9)  As part of an administrative or judicially approved settlement agreement, the department may require the liable person to provide financial assurance, in an amount determined by the department, to ensure the long-term operation and maintenance of the remedial action site. The liable person shall provide the financial assurance by any one method or combination of methods satisfactory to the department, including but not limited to insurance, guarantee, performance or other surety bond, letter of credit, qualification as a self-insurer, or other demonstration of financial capability."



Section 21.  Section 75-10-720, MCA, is amended to read:

"75-10-720.   Condemnation -- creation of state lien. (1) Whenever the department determines that property upon which a release or threatened release of a hazardous or deleterious substance has occurred may present an imminent and substantial endangerment to the public health, safety, or welfare or the environment, the department may condemn the property for public use to mitigate the threat. The taking of the property must be conducted in accordance with the procedure set forth in Title 70, chapter 30, parts 1 through 3.

(2)  All costs, penalties, and natural resource damages for which a person has been judicially determined to be liable to the state pursuant to 75-10-715 constitute a lien in favor of the state upon all property and rights to the property that belong to the person.

(3)  The lien imposed by this section arises at the time notice incorporating a description of the property subject to the remedial action and an identification of the amount of costs, penalties, and natural resource damages is duly filed with the clerk and recorder of the county in which the real property is located. A copy of the notice must be served by certified mail upon the liable person.

(4)  The costs, penalties, and natural resource damages constituting the lien may be recovered in an action in the district court for the district in which the property is located or in which the remedial action is occurring or has occurred. This section does not affect the right of the state to bring an action against a person to recover all costs, penalties, and natural resource damages for which that person is liable under this part or any other provision of state or federal law.

(5)  The lien must continue until the liability for the costs and damages incurred as a result of the release of a hazardous or deleterious substance is satisfied.

(6) If the department expends money from the fund for orphan share remedial action costs at a facility or for a facility at which a reimbursed orphan share exists, the state has a lien upon the facility for the unrecovered costs. The lien:

(a) may not exceed the increase in fair market value of the property attributable to the unfunded portion of the remedial action at the time of a subsequent sale or other disposition of the property;

(b) arises at the time costs are first incurred by the department with respect to a remedial action at the facility;

(c) must be filed according to subsection (3); and

(d) continues until the earlier of satisfaction of the lien or recovery of all remedial action costs incurred at the facility.

(7) Payment of any liens under this section must be deposited in one of the two accounts from which the remedial action costs originated, including the fund established in 75-10-704 or the orphan share fund established in [section 27]."



Section 22.  Section 75-10-724, MCA, is amended to read:

"75-10-724.   Liability apportionment and contribution Private right of action. (1) Any person who receives notice under 75-10-711, who is held jointly and severally liable under 75-10-715, or who initiates a voluntary cleanup under the provisions of 75-10-730 through 75-10-738 may bring a private right of action, including a claim for contribution or declaratory relief, against any other person who is liable or potentially liable under 75-10-715 for the recovery of remedial action costs. In resolving contribution claims, the court shall allocate remedial action costs among the liable persons based on the factors set out in [section 34]. has the right at trial to have the trier of fact apportion liability among the parties as provided in this section. The burden is on each liable person to show how his liability should be apportioned. In apportioning the liability of any person under this section, the trier of fact shall consider the following:

(a)  the extent to which the person's contribution to the release of a hazardous or deleterious substance can be distinguished;

(b)  the amount of hazardous or deleterious substance involved;

(c)  the degree of toxicity of the hazardous or deleterious substance involved;

(d)  the degree of involvement of and care exercised by the person in manufacturing, treating, transporting, or disposing of the hazardous or deleterious substance;

(e)  the degree of cooperation by the person with federal, state, or local officials to prevent any harm to the public health, safety, or welfare or the environment; and

(f)  knowledge by the person of the hazardous nature of the substance.

(2)  If a person is held jointly and severally liable under 75-10-715 and establishes a proportionate share of the aggregate liability, the person has the right of contribution from any other liable person. If for any reason all or part of the contribution from a person liable for contribution cannot be obtained, each of the other persons against whom recovery is allowed is liable to contribute a proportional part of the unpaid portion of the noncontributing person's share and may obtain judgment in a pending or subsequent action for contribution from the noncontributing person."



Section 23.  Section 82-4-141, MCA, is amended to read:

"82-4-141.   Violation -- penalty. (1) A person or operator who violates any of the provisions of this part or rules or orders adopted under this part shall pay a civil penalty of not less than $100 or more than $1,000 for the violation and an additional civil penalty of not less than $100 or more than $1,000 for each day during which a violation continues and may be enjoined from continuing such the violations as provided in this section. These penalties shall must be recoverable in any action brought in the name of the state of Montana by the attorney general in the district court of the first judicial district of this state in and for the county of Lewis and Clark or in the district court having jurisdiction of the defendant.

(2)  The attorney general shall, upon the request of the director, sue for the recovery of the penalties provided for in this section and bring an action for a restraining order, temporary or permanent injunction against an operator or other person violating or threatening to violate an order adopted under this part.

(3)  A person who willfully violates any of the provisions of this part or any determination or order adopted under this part which that has become final is guilty of a misdemeanor and shall be fined not less than $500 and not more than $5,000. Each day on which a violation occurs constitutes a separate offense.

(4) Civil penalties collected under this section must be deposited in the orphan share account in the state special revenue fund."



Section 24.  Section 82-4-241, MCA, is amended to read:

"82-4-241.   Receipts paid into general fund. (1) Except for bond forfeiture moneys as provided in subsection (2), all fees, penalties, and other moneys money available or paid to the department under the provisions of this part shall must be placed in the state treasury and credited to the general fund.

(2) Civil penalties paid to the department under 82-4-254 must be placed in the orphan share account in the state special revenue fund."



NEW SECTION. Section 25.  Citizens suit. (1) Any person may commence a civil action to compel compliance with [sections 26 through 36] by any liable or potentially liable person under 75-10-715 alleged to be in violation of a rule, notice letter, order, or department-approved remedial action required pursuant to a notice letter or order under this chapter.

(2) At least 60 days before commencing the action, the person shall give notice of intent to sue to all liable or potentially liable persons under 75-10-715 who are contemplated to be defendants in the proposed action.

(3) An action may not be commenced under subsection (1) if the liable or potentially liable person is diligently coming into compliance with the rule, notice letter, order, or department-approved remedial action plan or if the department has commenced and is diligently prosecuting an action to require compliance with the rule, notice letter, order, or department-approved remedial action plan.



NEW SECTION. Section 26.  Short title. [Sections 26 through 36] may be cited as the "Controlled Allocation of Liability Act".



NEW SECTION. Section 27.  Orphan share state special revenue account -- reimbursement of claims -- payment of department costs. (1) There is an orphan share account in the state special revenue fund established in 17-2-102 that is to be administered by the department. Money in the account is available to the department by appropriation and must be used to reimburse remedial action costs claimed pursuant to [sections 26 through 36] and to pay costs incurred by the department in defending the orphan share.

(2) There must be deposited in the orphan share account:

(a) money allocated from the metalliferous mines license tax pursuant to 15-37-117;

(b) money in excess of $250,000 per year collected by the department as provided in [section 2 of House Bill No. 284] establishing an environmental rehabilitation and prevention account;

(c) all penalties assessed pursuant to [section 34(12)];

(d) funds received from the interest income of the resource indemnity trust fund pursuant to 15-38-202;

(e)  funds allocated from the resource indemnity and ground water assessment tax proceeds provided for in 15-38-106;

(f) unencumbered funds remaining in the abandoned mines state special revenue account provided in section 19, Chapter 584, Laws of 1995, as of [the termination date of section 19, Chapter 584, Laws of 1995, as may be amended];

(g) interest income on the account;

(h) funds received from settlements pursuant to 75-10-719(7);

(i) funds received from reimbursement of the department's orphan share defense costs pursuant to subsection (6);

(j)  fine and penalty money received pursuant to 75-2-412, 75-2-413, 75-2-427, 75-3-407, 75-5-634, 75-6-109, 75-6-114, 75-10-417, 75-10-418, 75-10-423, 75-10-424, 75-10-542, 82-4-141, and 82-4-241; and

(k) unclaimed or excess reclamation bond money received pursuant to 82-4-141 and 82-4-241.

(3)  If the orphan share fund contains sufficient money, valid claims must be reimbursed subsequently in the order in which they were received by the department. If the orphan share fund does not contain sufficient money to reimburse claims for completed remedial actions, a reimbursement may not be made and the orphan share fund, the department, and the state are not liable for making any reimbursement for the costs. The department and the state are not liable for any penalties if the orphan share fund does not contain sufficient money to reimburse claims, and interest may not accrue on outstanding claims.

(4) Except as provided in subsection (8), claims may not be submitted and remedial action costs may not be reimbursed from the orphan share fund until all remedial actions, except for operation and maintenance, are completed at a facility.

(5) Reimbursement from the orphan share fund must be limited to actual documented remedial action costs incurred after the date of petition provided in [section 29]. Reimbursement may not be made for attorney fees, legal costs, or operation and maintenance costs.

(6) (a) The department's costs incurred in defending the orphan share must be paid by the persons participating in the allocation under [sections 26 through 36] in proportion to their allocated shares. The orphan share fund is responsible for a portion of the department's costs incurred in defending the orphan share in proportion to the orphan share's allocated share, as follows:

(i) If sufficient funds are available in the orphan share fund, the orphan share fund must pay the department's costs incurred in defending the orphan share in proportion to the share of liability allocated to the orphan share.

(ii) If sufficient funds are not available in the orphan share fund, persons participating in the allocation under [sections 26 through 36] shall pay all the orphan share's allocated share of the department's costs incurred in defending the orphan share in proportion to each person's allocated share of liability.

(b) A person who pays the orphan share's proportional share of costs has a claim against the orphan share fund and must be reimbursed as provided in subsection (3).

(7) If any money remains in the orphan share fund after [the termination date of this section] and after outstanding claims are paid, the money must be deposited in the general fund.

(8) If the lead liable person under [section 30] presents evidence to the department that the person cannot complete the remedial actions without partial reimbursement and that a delay in reimbursement will cause undue financial hardship on the person, the department may allow the submission of claims and may reimburse the claims prior to the completion of all remedial actions. A person is not eligible for early reimbursement unless the person is in substantial compliance with all department-approved remedial action plans.

(9) A person participating in the allocation process who received funds under the mixed funding pilot program provided for in sections 14 through 20, Chapter 584, Laws of 1995, may not claim or receive reimbursement from the orphan share fund for the amount of funds received under the mixed funding pilot program that are later attributed to the orphan share under the allocation process.



NEW SECTION. Section 28.  Eligibility -- statute of limitations. (1) Except for a facility that is listed on the national priorities list pursuant to the federal Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. 9601, et seq., a facility listed on the priority list established pursuant to 75-10-702 is eligible for the allocation process under [sections 26 through 36].

(2) Only liability for remedial action costs is eligible for allocation and reimbursement from the orphan share fund. Allocation of liability and reimbursement of costs for natural resource damages is not permitted under [sections 26 through 36].

(3) Remedial action costs incurred prior to the date of the potentially liable person's written petition to the department as provided in [section 29] are not eligible for reimbursement from the orphan share fund.

(4) Only one allocation will be allowed for each facility unless:

(a) the department determines that an additional allocation is appropriate due to:

(i) the existence of more than one discrete unit of contamination at the facility;

(ii) the discovery of new releases after remedial actions at the facility are complete; or

(iii) other factors the department determines appropriate.

(b) all the liable or potentially liable persons under 75-10-715 agree in writing that an orphan share does not exist for the proposed allocation and either of the conditions in subsection (4)(a)(i) or (4)(a)(ii) is met.

(5) A liable or potentially liable person under 75-10-715 may not file a cost recovery or contribution action against any person participating in the allocation process provided for in [sections 26 through 36] until the allocation process is complete. The statute of limitations on the filing of cost recovery or contribution actions is tolled from the first date of a petition for allocation on a facility until 30 days after the submittal of the allocation report provided for in [section 34], or until 30 days following the expiration of the time period for appeal or the final decision on appeal.



NEW SECTION. Section 29.  Allocation of liability -- process initiation. (1) For a facility at which the department has initiated a remedial action under 75-10-711 through the issuance of a notice letter prior to [the effective date of this section], any person determined to be potentially liable under 75-10-715 may petition the department in writing to initiate the allocation process. The right to participate in the allocation process is waived if the written petition is not provided to the department prior to the completion of remedial actions, except for operation and maintenance, at the facility.

(2) For a facility at which the department has not initiated a remedial action through the issuance of a notice letter under 75-10-711, any person potentially liable under 75-10-715 who has received approval of a voluntary cleanup plan under 75-10-730 through 75-10-738 may petition the department in writing to initiate the allocation process. The right to participate in the allocation process is waived if the written petition is not provided to the department prior to the completion of remedial actions, except for operation and maintenance, at the facility.

(3) For a facility at which the department initiates a remedial action through the issuance of a notice letter under 75-10-711 after [the effective date of this section], any person potentially liable under 75-10-715 may petition the department in writing within 60 days of the date of the notice letter to initiate the allocation process. Any potentially liable person under 75-10-715 who does not provide a written petition to the department within this timeframe waives the right to participate in the allocation process and remains liable as provided in 75-10-715. The notice letter sent by the department must advise that a failure to petition the department for allocation as provided in this subsection will result in a waiver of the right to participate in the allocation process.

(4) The allocation process may be initiated and may proceed upon written petition of one or more potentially liable persons.

(5) Prior to the initiation of discovery as provided in [section 31], all persons who participate in the allocation process shall agree in writing that the allocator's decision is binding, subject only to the provisions of [section 34(9)] and the appeal provisions of [section 35].

(6) All liable or potentially liable persons under 75-10-715 who do not participate in the allocation process under [sections 26 through 36] remain liable as provided in 75-10-715.

(7) Upon receipt of a written petition under subsections (1) or (2) or when initiating actions at a facility without a prior notice letter under subsection (3), the department shall:

(a) conduct a good faith investigation and may use its authority in 75-10-707 to identify persons who may be liable under 75-10-715; and

(b) issue notice letters to the persons it identifies as potentially liable under 75-10-715.

(8) A person who receives a notice letter may, within 60 days from the date of the notice letter, petition the department in writing to participate in an allocation process and provide the department with the identity of other potentially liable persons under 75-10-715 who were not noticed by the department. When identifying additional potentially liable persons, the noticed person shall provide to the department a statement and credible evidence showing that there is a basis in law and fact to determine that the identified person is potentially liable under 75-10-715.

(9) Within 30 days of receipt of the information provided for in subsection (8), the department may issue a notice letter to an identified person whom the department determines is a potentially liable person under 75-10-715. If the department does not issue a notice letter to an identified person, the department shall issue the person a nomination letter indicating that the person has been identified as potentially liable under 75-10-715. The nomination letter must state that the person has the right to participate in the allocation process and that if the person does not participate and is found liable, the person remains subject to liability as provided in 75-10-715. If the newly noticed or nominated person chooses to participate in the allocation process, the person shall provide a written petition of the person's intent to participate in the allocation process to the department within 30 days of the date of the notice or nomination letter. A failure to petition the department for allocation as provided in this subsection results in a waiver of the right to participate in the allocation process.

(10) If a person nominated under subsection (9) cannot be readily located, the department shall, within 30 days of receipt of the information provided for in subsection (8), publish one notice of the person's nomination, along with the information contained in a nomination letter under subsection (9), in a newspaper of general circulation in the county where all or a portion of the facility is located. The notice must state that the person has 30 days from the date of the notice to petition the department, in writing, to participate in the allocation process. A failure to petition the department for allocation as provided in this subsection results in a waiver of the right to participate in the allocation process.

(11) If one or more potentially liable persons petition in writing for an allocation process under subsection (1), (2), or (3) and the department determines that the facility has a potential orphan share, the department shall:

(a) publish a notice and brief description of the facility in a newspaper of general circulation in the area affected and provide at least 30 days for submission of public comment on the identification of potentially liable persons under 75-10-715; and

(b) notify interested persons and the county commissioners of the county where EACH COUNTY IN WHICH ALL OR A PORTION OF the facility is located and provide at least 30 days for submission of comments on the identification of potentially liable persons under 75-10-715.

(12) If a nominated person participates in the allocation and the person is assigned a zero share of liability by the allocator, that person's reasonable costs of participating in the allocation, including attorney fees, must be borne by the person who proposed the addition of the nominated person to the allocation.

(13) If the department anticipates that a facility may have an orphan share, the department shall represent the orphan share in the allocation process. If the state is a potentially liable person under 75-10-715, an agency or entity other than the department shall represent the state in the allocation process.

(14) Except as provided in subsection (15), whenever the department is involved in allocation processes on five facilities, other allocation processes may be stayed before the discovery stage provided in [section 31]. Upon completion of an allocation provided in [section 34 or 35], execution of a stipulated agreement under [section 34], or a default to liability as provided in 75-10-715 for one of the five facilities, the department shall notify the potentially liable persons for the facility on the waiting list that has the earliest date of written petition. Discovery under [section 31] must begin within 10 days of department notification.

(15) A stay on the allocation process may not occur under subsection (14) if all persons participating in the allocation process agree in writing that there is no orphan share and that the state is not a potentially liable person under 75-10-715. The agreement is binding upon all noticed or nominated persons.

(16) If, after initiating the process, a potentially liable person elects to discontinue participation in the process, the person remains subject to liability as provided in 75-10-715.



NEW SECTION. Section 30.  Emergency actions -- remedial action requirements -- designation of lead person -- enforcement. (1) If the department determines that immediate response to an imminent threat to public health, safety, or welfare or the environment is necessary to avoid substantial injury or damage to persons, property, or resources, the department may require any potentially liable person to take remedial actions without the prior written notice required by 75-10-711(3). The department has 30 days to comply with the notification requirements provided in 75-10-711(3) and [section 29] when requiring emergency remedial actions.

(2) Within 30 days of the issuance of the notice letters, the noticed persons shall designate a lead person who shall conduct remedial actions at the facility. Upon request of the noticed persons and for good cause shown, the department may grant a 30-day extension of time to identify the lead person.

(3) If the department determines that the identified lead person is financially or otherwise incapable of completing remedial actions required by the department, the department shall notify all noticed persons of this determination in writing and request that another lead person be designated within 15 days.

(4) The designated lead person shall undertake all remedial actions required by the department.

(5) If the noticed persons do not designate an approved lead person within the timeframes provided under subsection (2) or (3), the department shall designate a lead person to undertake required remedial actions.

(6) If the department finds that the lead person has not complied with the requirements of a notice letter, order, stipulated agreement, or any department-approved remedial action plan, the department shall notify all potentially liable persons of the noncompliance.

(7) If the noncompliance continues for 30 days after the date of the notice provided in subsection (6), the potentially liable persons have not demonstrated that the noncompliance is due to good cause, and the facility is a maximum or high-priority facility on the department's priority list established pursuant to 75-10-702, the department shall take one or more of the following actions:

(a) issue a unilateral order requiring the potentially liable persons to comply with the requirements of the notice letter, order, stipulated agreement, or department-approved remedial action plan;

(b) file a civil action as provided in 75-10-711;

(c) conduct the required remedial actions and seek cost recovery and penalties as provided in 75-10-711;

(d) file a cost recovery action as provided in 75-10-722; or

(e) void approval of the voluntary cleanup plan as provided in 75-10-736.

(8) If the noncompliance continues for 30 days after the date of the notice provided in subsection (6), the potentially liable persons have not demonstrated that the noncompliance is due to good cause, and the facility is not a maximum or high-priority facility on the department's priority list, the department may take one or more of the actions provided for in subsection (7).

(9) For purposes of subsections (7), (8), and (10), "good cause" means factors beyond a person's control that include severe weather conditions, third-party interference, an act of God, or an act of war. Before a person may claim good cause due to third-party interference, the person shall show that the person used reasonable efforts to obtain cooperation or compliance from the third party.

(10) If the lead person fails to comply with the requirements of a notice letter, order, stipulated agreement, or other department-approved remedial action plan, the facility and all noticed persons remain subject to liability as provided in 75-10-715 unless another person assumes the lead role in implementing the cleanup plan REQUIRED REMEDIAL ACTIONS or the lead person can establish that the noncompliance is due to good cause.



NEW SECTION. Section 31.  Discovery. (1) Each person participating in the allocation process for a facility may conduct discovery for a period of not more than 90 days from the date of the last notice or nomination letter. Discovery requests by each person participating in the allocation process, including the orphan share representative, are limited to the following unless otherwise agreed to by all persons participating in the allocation, including the orphan share representative:

(a) 5 1-day oral depositions not to exceed 8 hours each;

(b) 25 written interrogatories, including subparts;

(c) 50 requests for admission; and

(d) 50 requests for production of documents.

(2) The persons participating in the allocation process may extend the discovery period for up to 30 days if all persons agree to the extension in writing.

(3) Any participating person who is not responsive to discovery requests or who does not participate in the subsequent allocation proceeding and is allocated a share of liability remains subject to liability as provided in 75-10-715.



NEW SECTION. Section 32.  Preallocation negotiations. (1) After discovery pursuant to [section 31] closes, all persons participating in the allocation process shall conduct good faith settlement negotiations for a period of 30 days.

(2) The participating potentially liable persons may use an impartial mediator when conducting settlement negotiations.

(3) If a settlement is reached under subsection (1), the persons shall execute a stipulated agreement as provided in [section 34].

(4) If a stipulated agreement is not executed as provided in [section 34], the persons shall select an allocator as provided in [section 33].



NEW SECTION. Section 33.  Allocator selection -- payment of fees. (1) If the preallocation negotiations pursuant to [section 32] fail to produce a stipulated agreement within the timeframe provided in [section 32], the participating persons shall select an allocator within 30 days after the preallocation negotiations end. All participating persons shall agree on the selected allocator.

(2) Before selection or appointment as an allocator, a person shall disclose all conflicts of interest, including whether the allocator is or has been a relative, attorney, agent, employee, creditor, or contractor of, or in any manner is or has been interested financially or personally with, any person involved in the allocation.

(3) If the participating persons are unable to agree on an allocator within the required 30 days, one or more of the participating persons shall apply for judicial resolution, within 10 days, to the district court in the county where the release occurred or where any potentially liable person under 75-10-715 resides or has a principal place of business or in the district court of the first judicial district. If an application to the district court is not made within 10 days, all persons remain subject to liability as provided in 75-10-715 and the allocation process ends.

(4) Upon selection or appointment of the allocator, the lead person shall advance, if required by the allocator, up to $5,000 toward the allocator's expenses. Any expenses accrued by the allocator for legal or technical expertise must be approved in advance by all the participating persons. The allocator's fees and reasonable expenses must be divided among the participating liable persons, except the orphan share, in proportion to their allocated shares. The orphan share fund established in [section 27] is not responsible for any portion of the allocator's fees and expenses.



NEW SECTION. Section 34.  Allocating liability. (1) Upon selection or appointment, the allocator shall establish the process and schedule for determining the allocation, including the length and scope of any documents to be presented.

(2) The participating persons shall submit to the allocator and to each other a statement of position and exhibits of a factual nature. Each person's statement must identify the factors listed in subsection (5) that the person believes are relevant to allocation of liability for the facility.

(3) The allocator may convene the participating persons as the allocator believes necessary to clarify the facts and may pose additional questions, interview any person or the person's representative, and impose presumptions concerning missing information. The allocator may seek department assistance with information gathering pursuant to 75-10-707.

(4) The allocator may not engage in ex parte communications with any person or the person's representative.

(5) The allocator shall allocate each participating and nonparticipating person's share of liability based only on information presented or collected during the allocation process and, taking into account facility characteristics, shall apportion liability on a percentage basis according to the following factors:

(a) the extent to which the person caused the release of the hazardous or deleterious substance;

(b) the extent to which the person's contribution to the release of a hazardous or deleterious substance can be distinguished;

(c) the amount or volume of hazardous or deleterious substance and the amount contributed by the person;

(d) the relative hazard of the hazardous or deleterious substance contributed by the person, including volatility, carcinogenicity, mobility, persistence, reactivity, and toxicity;

(e) the degree of past and present cooperation by the person with the government to prevent harm to the public health, safety, or welfare and the environment, including participation in remedial actions occurring concurrently with the allocation process and compliance and cooperation with discovery pursuant to [section 31];

(f) what the person knew or should have known of:

(i) the hazardous nature of the substance, the risk associated with that substance, and proper waste disposal practices;

(ii)(G) the circumstances of the property acquisition, including the documented price paid and discounts granted; and

(iii)(H) the person's knowledge of or acquiescence to waste generation, storage, handling, treatment, or disposal;

(g)(I) the length of time of ownership, operation, generation, or transportation;

(h)(J) any violations of or noncompliance with health and environmental regulations, including permit violations or violations relating to public notification;

(i)(K) the degree to which a person providing publicly owned landfill or sewer and water systems had or has a reasonable ability to control disposed materials and the person's degree of care in maintaining those services;

(j)(L) the person's financial or economic benefit from:

(i) ownership or operation of the facility;

(ii) the generation, transportation, or disposal of the hazardous or deleterious substance; and

(iii) cleanup of the facility;

(k)(M)  whether the person exercised due diligence in generating, transporting, or disposing of hazardous or deleterious substances and the person's control over those activities; and

(l)(N) other equitable factors that are appropriate.

(6) Within 60 days of selection or appointment, the allocator shall submit to the department and all noticed and nominated persons a written allocation report that allocates each person's share of liability and that documents the rationale for the percentage of liability allocated to each person.

(7)  The allocator or the participating persons may extend the allocation proceeding by up to 30 days if agreed to by the allocator and all the participating persons.

(8) Within 30 days of the date of the allocation report, the persons who participated in the allocation and who were allocated a share of liability, except for the orphan share, shall prepare and sign a stipulated agreement that contains:

(a) the percentage share of liability for each person as determined by the allocator;

(b) procedures for paying for the orphan share prior to reimbursement from the orphan share fund;

(c) a waiver of contribution rights against all persons who are potentially liable for the remedial action as well as a waiver of any rights to challenge any settlement that the department enters into with any other potentially liable person;

(d)  covenants not to sue and provisions regarding performance or adequate assurance of performance of remedial actions;

(e) how remedial actions will be conducted;

(f) a penalty provision in accordance with subsection (12);

(g) acknowledgment of contribution protection, consistent with 75-10-719(1), regarding matters addressed in the settlement; and

(h)  provisions detailing how the persons signing the stipulated agreement should receive reimbursement from the orphan share fund for any remedial action costs incurred by the persons in excess of their allocated share.

(9) If the department determines that the stipulated agreement does not satisfy the requirements of subsection (8), the liable persons who participated in the allocation remain subject to liability as provided in 75-10-715.

(10) A person who did not participate in the allocation but who was assigned a share of liability may sign the stipulated agreement prepared according to subsection (8).

(11) Any liable person allocated a share of liability who does not sign the stipulated agreement remains subject to liability as provided in 75-10-715.

(12) Any liable person who signs the stipulated agreement and fails to comply with the terms of the stipulated agreement shall pay, in addition to the person's share of remedial action costs, a penalty of two times the amount of the person's allocated share of liability. Any funds received must be applied to the facility's orphan share and any funds in excess of the facility's orphan share amount must be deposited in the orphan share fund established under [section 27].

(13) If a liable person becomes bankrupt or defunct after the stipulated agreement is signed and before remedial actions are complete at the facility, that person's share of liability becomes an orphan share.



NEW SECTION. Section 35.  Appeal of allocator's decision. (1) A person may appeal the allocator's decision to district court within 30 days of the date of the allocation report. Venue lies in the county where the release occurred or where the liable person resides or has a principal place of business or in the first judicial district.

(2) The allocator's decision must be upheld unless the person appealing the decision demonstrates that the decision was:

(a) made upon unlawful procedure;

(b) affected by other error of law;

(c) clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or

(d) arbitrary and capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion or was fraudulent.

(3) If the appeal is successful, the district court shall allocate the liability of the potentially liable persons using the factors outlined in [section 34].

(4) After decision on the appeal, all liable persons shall submit a stipulated agreement as provided in [section 34] to the department based on the court order.



NEW SECTION. Section 36.  Effect of termination on allocations. (1) Persons participating in the allocation process may complete the allocation process for the facility at issue and claim reimbursement from the orphan share fund provided that the discovery process under [section 31] had been initiated by [the termination date of sections 26 through 36].

(2) If discovery, as provided in [section 31], has not commenced by [the termination date of sections 26 through 36], the facility and its potentially liable persons under 75-10-715 are not eligible to participate in the allocation process under [sections 26 through 36] and remain subject to liability as provided in 75-10-715.



Section 37. Section 16, Chapter 584, Laws of 1995, is amended to read:

"Section 16. Criteria.  (1) the pilot program must consist consists of remediation of the Joslyn street tailings facility, the Corbin flats facility, and the block P mill facility three sites from the department of state lands' abandoned hard-rock mine priority list. The three sites must be selected from the top ten priority sites on that list as of April 1, 1995.

(2) Any site remediated under this pilot program must meet the following criteria:

(a) The owner of the property has, prior to May 22, 1989, purchased or entered into a lease purchase agreement or an option to purchase property where the facility is located.

(b) The applicant has submitted a voluntary cleanup plan in accordance with the provisions of [sections 7 and 8].

(c) The department has accepted and approved the application for a voluntary cleanup plan in accordance with the provisions of [sections 6 through 10] by June 30, 1997.

(3) The department and the applicant shall negotiate an apportionment of the applicant's liability pursuant to [section 17]. The department, as a trier of fact, shall make the final determination of the applicant's apportioned liability. If the applicant disagrees with the department's determination of the applicant's proportionate share of liability, the applicant may appeal the department's decision in accordance with the requirements of [section 6(4)].

(4) If more than three applicants submit voluntary cleanup plans for the highest priority sites on the department of state lands' abandoned hard-rock mine priority list and the department approves more than three plans, the department shall select three plans to incorporate into the pilot program on a priority basis as determined by the date of submittal of a complete application."



Section 38. Section 18, Chapter 584, Laws of 1995, is amended to read:

"Section 18. Claims for and limitations on reimbursement. (1) After completion of the voluntary cleanup plan approved by the department, the applicant may apply to and must, in accordance with this section, receive reimbursement from the abandoned mines state special revenue account. Reimbursement must be subject to the following requirements and limitations:

(a) The applicant shall complete remediation prior to making a claim for reimbursement.

(b) The reimbursement may not exceed 90% of eligible costs up to a maximum of $300,000 per facility.

(c) The claim for reimbursement may not include legal fees or department costs incurred in the oversight of the voluntary cleanup plan.

(2) For purposes of this section, "eligible costs" means costs in excess of an applicant's proportionate share of total costs incurred in the remediation of the site during the 1996-97 biennium and the 1998-99 biennium.

(3) If costs are reimbursed out of the abandoned mines state special revenue account, nothing in [sections 14 through 20] prohibits the department from pursuing an action against other potentially liable parties to recover those costs.

(4) If the abandoned mines state special revenue account does not contain sufficient money to pay received claims for reimbursement, the abandoned mines state special revenue account and the department are not liable for making any reimbursement at that time. All claims are subject to appropriations to the abandoned mines state special revenue account." 



Section 39. Section 27, Chapter 584, Laws of 1995, is amended to read:

"Section 27. Termination. (1) [Sections 4 through 12] terminate January 1, 2001.

(2) [Sections 14 through 21 20] terminate June 30, 1997 1999.

(3) [SECTION 21] TERMINATES JUNE 30, 1997."



NEW SECTION. Section 40.  Codification instruction. [Sections 25 through 36] are intended to be codified as an integral part of Title 75, chapter 10, part 7, and the provisions of Title 75, chapter 10, part 7, apply to [sections 25 through 36].



NEW SECTION. Section 41.  Coordination instructions. (1) If Senate Bill No. 7 and [this act] are both passed and approved, the amendments to 15-37-117 in Senate Bill No. 7, relating to the allocation of the metal mines license tax, are void.

(2) If [this act] and House Bill No. 284 are both passed and approved and House Bill No. 284 does not contain a section creating and depositing excess penalty collections into an orphan share account, then [section 27 (2)(b) of this act] is void.

(3) If [this act] and House Bill No. 284 are both passed and approved and House Bill No. 284 does contain the DEPOSIT EXCESS PENALTY COLLECTIONS IN AN orphan share account referenced in subsection (2) of this section, then [sections 4 through 15, 23, 24, and 27(2)(j) of this act] are void.



NEW SECTION. Section 42.  Severability. If a part of [sections 25 through 36] are invalid, all valid parts that are severable from the invalid part remain in effect. If a part of [sections 25 through 36] is invalid in one or more of its applications, the part remains in effect in all valid applications that are severable from the invalid applications.



NEW SECTION. Section 43.  Effective dates. (1) Except as provided in subsections (2) and (3), [this act] is effective July 1, 1997.

(2) [Section 17 and this section] are effective on passage and approval.

(3) [Section 3] is effective July 1, 1999.



NEW SECTION. Section 44.  Termination. [Sections 25 26 through 36] terminate June 30, 2005.

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