FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
--------------------------------------
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 33-42125
Chugach Electric Association, Inc.
(Exact name of registrant as specified in its charter)
Alaska 92-0014224
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5601 Minnesota Drive Anchorage, Alaska 99518
(Address of principal executive offices) (Zip Code)
(907) 563-7494
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X . No .
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
CLASS OUTSTANDING AT NOVEMBER 1, 1996
NONE NONE
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CHUGACH ELECTRIC ASSOCIATION, INC.
INDEX
Part I. Financial Information Page Number
Balance Sheets, September 30, 1996 (Unaudited) and December 31, 1995 3
Statements of Revenues, Expenses and Patronage Capital, Three-Months Ended
September 30, 1996 and 1995 and Nine-Months Ended September 30, 1996 and
1995 (Unaudited) 5
Statements of Cash Flows, Nine-Months Ended September 30, 1996 and 1995
(Unaudited) 6
Notes to Financial Statements (Unaudited) 7
Management's Discussion and Analysis of Financial Condition and Results of
Operations (Unaudited) 8
Part II. Other Information
Item 1. Legal Proceedings 11
Item 6. Exhibits and Reports on Form 8-K 13
Signatures 14
Exhibits - Index 15
Exhibits 16
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CHUGACH ELECTRIC ASSOCIATION, INC.
Balance Sheets
Assets
<TABLE>
September 30, 1996 December 31, 1995
------------ ------------
(Unaudited)
<S> <C> <C>
Utility plant:
Electric plant in service ............................. $607,762,381 $587,877,992
Construction work in progress ......................... 17,591,609 27,068,964
------------ ------------
625,353,990 614,946,956
Less accumulated depreciation ......................... 210,880,665 196,677,723
------------ ------------
Net utility plant .................... 414,473,325 418,269,233
------------ ------------
Other property and investments, at cost:
Nonutility property ................................... 3,550 3,550
Investments in associated organizations ............... 7,419,304 7,513,807
Restricted cash - margins from economy
energy sales, all repurchase agreements ............ 2,104,203 3,026,634
------------ ------------
9,527,057 10,543,991
------------ ------------
Current assets:
Cash and cash equivalents ............................. 3,013,133 6,371,687
Cash - restricted construction funds .................. 1,035,447 --
Special deposits ...................................... 88,098 97,789
Accounts receivable, net .............................. 13,610,955 17,108,823
Materials and supplies, at average cost ............... 20,246,087 18,498,783
Prepayments ........................................... 1,598,606 675,117
Other current assets .................................. 288,801 412,209
------------ ------------
Total current assets ................... 39,881,127 43,164,408
------------ ------------
Deferred charges ........................................... 12,584,062 12,812,691
------------ ------------
$476,465,571 $484,790,323
------------ ------------
</TABLE>
See accompanying notes to unaudited financial statements.
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CHUGACH ELECTRIC ASSOCIATION, INC.
Balance Sheets
Liabilities and Equities
<TABLE>
September 30, 1996 December 31, 1995
------------ ------------
(Unaudited)
<S> <C> <C>
Equities and margins:
Memberships ........................................ $ 801,793 $ 765,123
Patronage capital .................................. 100,599,198 95,421,358
Other .............................................. 2,963,752 3,044,069
------------ ------------
104,364,743 99,230,550
------------ ------------
Long-term obligations, excluding current installments:
First mortgage bonds payable ....................... 251,553,000 294,054,000
National Bank for Cooperatives (CoBank)
bonds payable ................................... 56,352,847 11,587,703
------------ ------------
307,905,847 305,641,703
------------ ------------
Current liabilities:
Bank overdraft ..................................... -- 492,204
Note(s) payable .................................... 5,500,000 8,000,000
Current installments of long-term debt and
capital leases .................................. 6,001,109 5,665,749
Accounts payable ................................... 3,677,762 6,659,477
Consumer deposits .................................. 1,064,555 1,119,056
Accrued interest ................................... 1,296,554 8,052,786
Salaries, wages and benefits ....................... 3,922,202 3,772,608
Fuel ............................................... 4,289,676 2,289,776
Other .............................................. 4,741,805 2,624,341
------------ ------------
Total current liabilities ............ 30,493,663 38,675,997
------------ ------------
Deferred credits ........................................ 33,701,318 41,242,073
------------ ------------
$476,465,571 $484,790,323
------------ ------------
</TABLE>
See accompanying notes to unaudited financial statements.
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CHUGACH ELECTRIC ASSOCIATION, INC.
Statements of Revenues, Expenses and Patronage Capital
<TABLE>
Three-months Nine-months
ended September 30 ended September 30
1996 1995 1996 1995
------------- ------------ ------------- ------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Operating revenues ................................ $ 31,187,058 $ 29,353,885 $ 97,529,513 $ 95,975,346
------------- ------------ ------------- ------------
Operating expenses:
Production ................................... 9,642,575 8,276,679 26,340,626 23,310,563
Purchased power .............................. 2,671,658 2,733,659 7,590,852 7,955,084
Transmission ................................. 971,775 757,068 2,558,468 2,365,108
Distribution ................................. 1,957,063 2,654,834 6,788,497 7,721,999
Consumer accounts ............................ 1,714,338 1,818,577 5,283,576 5,253,204
Administrative, general and other ............ 3,073,386 3,166,450 9,746,665 10,208,034
Depreciation and amortization ................ 5,217,446 4,856,515 15,454,996 14,356,847
------------- ------------ ------------- ------------
Total operating expenses ............. 25,248,241 24,263,782 73,763,680 71,170,839
------------- ------------ ------------- ------------
Interest:
On long-term debt .............................. 5,998,474 6,429,557 18,685,241 19,261,417
Other .......................................... 376,545 135,062 877,380 519,899
Charged to construction - credit ............... (153,418) (309,662) (391,513) (894,673)
------------- ------------ ------------- ------------
Net interest expense ................. 6,221,601 6,254,957 19,171,108 18,886,643
------------- ------------ ------------- ------------
Net operating margins ................ (282,784) (1,164,854) 4,594,725 5,917,864
------------- ------------ ------------- ------------
Nonoperating margins:
Interest income .............................. 180,726 212,017 571,869 578,123
Other ........................................ 89,546 70,345 144,037 (17,650)
------------- ------------ ------------- ------------
Total non-operating margins .......... 270,272 282,362 715,906 560,473
------------- ------------ ------------- ------------
Assignable margins ................... (12,512) (882,492) 5,310,631 6,478,337
Patronage capital at beginning of period .......... 100,660,740 98,385,504 95,421,358 91,079,686
Retirement of capital credits and
estate payments ................................ (49,030) (26,371) (132,791) (81,382)
------------- ------------ ------------- ------------
Patronage capital at end of period ................ $ 100,599,198 $ 97,476,641 $ 100,599,198 $ 97,476,641
------------- ------------ ------------- ------------
</TABLE>
See accompanying notes to unaudited financial statements.
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CHUGACH ELECTRIC ASSOCIATION, INC.
Statements of Cash Flows
<TABLE>
Nine-months ended September 30
1996 1995
------------ ------------
(Unaudited)
<S> <C> <C>
Cash flows from operating activities:
Assignable margins ................................................................. $ 5,310,631 $ 6,478,337
------------ ------------
Adjustments to reconcile assignable margins to net cash used in operating
activities:
Depreciation and amortization .................................................. 15,454,996 14,356,847
Changes in assets and liabilities:
(Increase) decrease in assets:
Accounts receivable, net ..................................................... 3,497,868 1,921,848
Materials and supplies ....................................................... (1,747,304) 4,417,032
Deferred charges ............................................................. 228,629 (441,656)
Prepayments .................................................................. (923,489) (813,696)
Other ........................................................................ 20,084 (112,253)
Increase (decrease) in liabilities:
Accounts payable ............................................................. (2,981,715) (648,379)
Accrued interest ............................................................. (6,756,232) (6,956,652)
Deferred credits ............................................................. (7,540,755) (2,742,479)
Consumer deposits, net ....................................................... (54,501) (19,049)
Other ........................................................................ 4,266,957 60,387
------------ ------------
Total adjustments ................................................. 3,464,538 9,021,950
------------ ------------
Net cash provided by operating activities ......................... 8,775,169 15,500,287
------------ ------------
Cash flows from investing activities:
Extension and replacement of plant ................................................. (11,659,088) (19,865,538)
Investments in associated organizations ............................................ 94,503 188,008
------------ ------------
Net cash used in investing activities ................................................. (11,564,585) (19,677,530)
------------ ------------
Cash flows from financing activities:
Net change in bank overdraft ....................................................... (492,204) 512,924
Proceeds from long-term debt ....................................................... 23,500,000 10,000,000
Repayments of long-term debt ....................................................... (20,900,496) (5,357,189)
Retirement of patronage capital .................................................... (132,791) (81,382)
Short-term borrowings, net ......................................................... (2,500,000) (1,500,000)
Other .............................................................................. (43,647) (106,780)
------------ ------------
Net cash provided by (used) in financing activities ............... (569,138) 3,467,573
------------ ------------
Net decrease in cash and cash equivalents ......................... (3,358,554) (709,670)
Cash and cash equivalents at beginning of period ...................................... 6,371,687 5,975,927
------------ ------------
Cash and cash equivalents at end of period ............................................ $ 3,013,133 $ 5,266,257
------------ ------------
</TABLE>
See accompanying notes to unaudited financial statements.
6
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CHUGACH ELECTRIC ASSOCIATION, INC.
Notes to Financial Statements
September 30, 1996
(Unaudited)
1. Presentation of Financial Information
During interim periods, Chugach Electric Association, Inc. (Chugach)
follows the accounting policies set forth in its audited financial
statements included in Form 10-K filed with the Securities and Exchange
Commission. Users of interim financial information are encouraged to refer
to footnotes contained in Form 10-K when reviewing interim financial
results. Management believes that the accompanying interim financial
statements reflect all adjustments that are necessary for a fair statement
of the results of the interim period presented. All adjustments made in the
accompanying interim financial statements are of a normal recurring nature.
2. Lines of Credit
Chugach maintains a line of credit of $35 million with National Bank for
Cooperatives (CoBank). The CoBank line of credit expires August 1, 1997 but
is expected to be renewed. At September 30, 1996, Chugach had no
outstanding balance on the CoBank line. In addition, the Association has an
annual line of credit of $50 million available at the National Rural
Utilities Cooperative Finance Corporation (NRUCFC). At September 30, 1996,
there was an outstanding balance of $5.5 million at an interest rate of
6.30%. The NRUCFC line of credit expires February 19, 1998.
3. Restricted Cash
Beginning in the first quarter of 1996, Chugach began receiving grant funds
from the Alaska Industrial Development and Export Authority (AIDEA) to
finance the siting study for the Southern Intertie. Under the terms of the
grant agreement, Chugach agreed to deposit these funds in a separate
interest bearing bank account at its main banking institution. Chugach
reimburses itself from this account monthly for expenditures related to the
siting study. At September 30, 1996, this account contained a balance of
$1,035,447.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Unaudited)
Results of Operations
Current Year Quarter Versus Prior Year Quarter
Operating revenues, that include sales of electric energy to retail, wholesale
and economy energy customers and other miscellaneous revenues, increased by 6.3%
for the quarter ended September 30, 1996 over the same quarter in 1995. The
increase in revenues is attributable to higher kilowatt hour (kWh) sales to
retail customers and one of the wholesale customer classes. Higher fuel costs
also contributed to the increase since fuel and purchased power costs are passed
directly to Chugach's customers through a fuel and purchased power adjustment
factor. Demand and energy rates were higher by 0.4% and 0.7% for the wholesale
customer classes in the third quarter of 1996 over the same period in 1995 which
also contributed to the increase in revenues. Retail demand and energy rates did
not change between the two quarters. All of these factors more than offset a
small decrease in sales to one of the wholesale customer classes.
Refer to the year to date comparison section for a discussion of outstanding
issues with the Alaska Public Utilities Commission (APUC).
Production expense increased for the quarter ended September 30, 1996 over the
same period in 1995. This increase was due primarily to higher fuel costs
associated with the increase in kWh sales and entering Period 2 under the
long-term fuel supply contracts. For several years prior to this, the price of
fuel had been ramped upwards to smooth the transition into Period 2. Entering
Period 2 completed the ramp from the inexpensive take-or-pay gas contracts (old
Beluga gas) to the new more market-based prices. Thus, future fuel costs are
expected to be higher in comparison to prior periods. Transmission expense was
higher for the quarter ended September 30, 1996 over the same period in 1995.
The majority of this increase was caused by higher overhead line maintenance
costs related to transmission right-of-way clearing activities. Distribution
expense decreased during the third quarter of 1996 primarily due to lower costs
associated with line maintenance expense (related to a reduction in distribution
right-of-way clearing activities).
Other interest expense increased in the current period due to a higher average
outstanding balance on the short-term line of credit. Interest charged to
construction decreased for the quarter ended September 30, 1996 compared to the
same period in 1995 due to a decrease in the balance in construction work in
progress during the period.
Current Year to Date Versus Prior Year to Date
Operating revenues for the nine-month period ended September 30, 1996 increased
relative to the same period in 1995. This increase in revenues was mainly due to
higher kWh sales to
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retail and one of the wholesale customer classes. The higher sales levels more
than offset slight decreases in average rates charged to these two classes.
Furthermore, these impacts (higher sales and reduction in average rates)
combined to offset a decrease in kWh sales and a small increase in average rates
charged to the other wholesale rate class.
In April 1996 Chugach filed for a $1.15 million revenue requirement increase
through its Simplified Rate Filing (SRF) procedure which resulted in proposed
wholesale demand and energy rate increases of 2.5% to one wholesale customer
class and 5.3% to the other. These rate increases were put into effect in May
1996 by the APUC on an interim-refundable basis pending investigation of several
ratemaking issues. At the present time, Chugach and its wholesale customers are
negotiating settlement proposals that address several of the issues raised in
this docket. It is not known how the Commission will rule in this proceeding.
In August 1996 the Chugach Board of Directors elected to discontinue Chugach's
participation in the SRF process to establish changes to base rates. Changing
ratemaking methodology must be approved by the APUC, hence, the request is
currently pending. Chugach will continue to be regulated by the APUC in the
establishment of rate levels and options. Recovery of variations in fuel and
purchased power costs will continue to occur through quarterly fuel surcharge
filings.
Production expense increased for the nine-month period ended September 30,
1996 for essentially the same reasons outlined in the quarter-to-date comparison
section. Distribution expense decreased during the period due primarily to a
lower level of line maintenance expense related to a reduction in distribution
right-of-way clearing activities. The other operating expenses remained
relatively constant when compared to the same period in 1995.
Other interest expense increased and interest-charged-to-construction decreased
for the nine-months ended September 30, 1996, for the same reasons outlined
above in the analysis of the quarter-to-quarter variance.
For the nine-month period ended September 30, 1996, Non-operating margins were
higher than those for the same period in 1995. This is primarily due to the
failure of a submarine cable that was recorded in 1995. No similar event
occurred in 1996.
Financial Condition
Total assets declined by 1.7% from December 31, 1995 to September 30, 1996. The
decrease is due primarily to the lower balance in net utility plant. This lower
balance was caused by the higher accumulated depreciation reserve resulting from
higher depreciation rates that have been implemented over a three-year phase-in
program. The seasonal decline in accounts receivable and the reduction in
restricted cash (due to amortization of the rate stabilization fund, see below)
also contributed to the lower total asset balance. These impacts more than
offset an increase in materials and supplies inventory caused by the
refurbishment of several major generation components held in inventory. Notable
changes to total liabilities include the decrease in First Mortgage bonds
payable and the corresponding increase in CoBank long-term debt resulting from
the repurchases of the Series 1 2022 bonds. Accrued interest decreased due to
the semi-annual bond interest payment made in September. Deferred credits
decreased due
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to additional amortization of the original gain on refinancing resulting from
the aforementioned bond repurchases. These impacts more than offset the increase
in other liabilities due to the reclassification of the current portions of both
the rate stabilization fund and the submarine cable reserve that will be
returned to customers in 1996 and early 1997.
Liquidity and Capital Resources
Chugach has satisfied its operational and capital cash requirements primarily
through internally generated funds, an annual $50 million line of credit from
NRUCFC and a $35 million line of credit with CoBank. At September 30, 1996,
Chugach had $5.5 million outstanding with NRUCFC that carried an interest rate
of 6.30%.
Capital construction in 1996 is estimated at approximately $26 million. At
September 30, 1996, approximately $11.7 million has been expended.
Chugach has negotiated a supplemental indenture (Third Supplemental Indenture of
Trust) with CoBank for up to $80 million in future bond financing. At September
30, 1996, Chugach had bonds in the amount of $56.6 million outstanding under
this financing arrangement. The balance is comprised of a $1.6 million bond
(CoBank 1) that carries an interest rate of 8.95% maturing in 2002, a $10.0
million bond (CoBank 2) priced at 7.76% due in 2005, a $21.5 million bond
(CoBank 3) priced at 6.30% (repriced monthly) and a $23.5 million bond (CoBank
4) priced at 6.30% (also repriced monthly). Principal payments on the CoBank 3
and 4 bonds commence in 2003 and continue through 2022. Additionally, Chugach
has negotiated a similar supplemental indenture (Fifth Supplemental Indenture of
Trust) with NRUCFC also for $80 million. At September 30, 1996, there were no
amounts outstanding under this financing arrangement.
To date, Chugach has repurchased $39.3 million of its Series 1 2022 bonds. This
strategy has been in response to the favorable long-term interest rate
environment. Chugach will continue to explore similar repurchase transactions if
market conditions warrant such action. Except for any further repurchases of its
bonds (and any similar future refinancings), Chugach does not anticipate
issuance of additional long-term debt in 1996.
Chugach management continues to expect that cash flows from operations and
external funding sources will be sufficient to cover operational and capital
funding requirements in 1996.
Chugach's current ratios (current assets divided by current liabilities) at
December 31, 1995 and September 30, 1996 were as follows:
Current Ratio
December 31, 1995 1.12
September 30, 1996 1.31
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Environmental Matters
Regulatory initiatives arising out of recent amendments to State and Federal
environmental laws (including the Clean Air Act Amendments of 1990) may require
significant capital expenditures in the future. These initiatives have not
developed to the point where their financial impact on Chugach can be
determined. Chugach is commenting on proposed revisions to the Alaska air
quality protection rules. The Association has focused its efforts on minimizing
the financial impact on Chugach of the new regulations, while meeting the
requirements of State and Federal law. Other environmental compliance changes
will require new substation designs to incorporate spill-containment features.
The cost of incorporating these features has been considered in future
construction work plan projects.
Refer to Part II, Item 1 for an update on the status of the Standard Steel
Salvage Yard Site litigation.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Standard Steel Salvage Yard Site
As previously reported in the Form 10-Q for the period ended June 30, 1996, a
cost recovery action was filed in Federal District Court on December 27, 1991,
by the United States against Chugach and six other Potentially Responsible
Parties (PRPs) seeking reimbursement of removal and response action costs (Past
Response Costs) incurred by US Environmental Protection Agency (EPA) at the
Standard Steel and Metals Salvage Yard Superfund Site in Anchorage, Alaska
(Site). The six other PRPs named in the action are the Alaska Railroad,
Westinghouse Electric Corporation, Sears, Roebuck and Co., Montgomery Ward &
Co., J.C. Penney Company, Inc. and Bridgestone/Firestone, Inc.
On September 23, 1992, Chugach entered into an Administrative Order on Consent
(AOC) with the EPA to perform a remedial investigation and feasibility study
(RI/FS) for the Site. Under a separate agreement, several federal agency PRPs
are reimbursing Chugach for 75% of the costs of performing the RI/FS. Chugach's
contractors now have completed the RI/FS for the Site and, based on the results
of the RI/FS, EPA has selected a remedy for cleanup of the Site which has been
documented in a Record of Decision (ROD). The preferred remedy for cleanup of
the Site selected by EPA is soil treatment by means of stabilization and
solidification (S/S). Although Chugach's contractors completed the RI/FS, EPA
has required Chugach to perform additional work pursuant to the AOC. Since the
last report in the Form 10-Q, EPA has required Chugach under the AOC to conduct
site repair work and a treatability study in addition to removing drums
containing potentially regulated materials.
As previously reported in the Form 10-Q, all of the PRPs and the United States
government, including EPA and the Department of Justice (DOJ), negotiated a
Partial Consent Decree to
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settle both the cost recovery action and the PRPs' (including the federal PRPs')
alleged liability for costs associated with the Site through completion of work
under the AOC and entry of the Partial Consent Decree. The Partial Consent
Decree reflects a settlement in which the United States has agreed to compromise
some of its costs. The Partial Consent Decree was lodged with the Federal
District Court on October 9, 1996, and is expected to be entered by the Court in
November 1996.
The Partial Consent Decree allocates to Chugach 14.37% of Past Response Costs,
DOJ enforcement costs (through entry of the Consent Decree), RI/FS Costs, and
EPA oversight costs (through completion of work under the AOC) incurred in
connection with the Site. RI/FS Costs include scrap and drum removal costs and
expenses associated with the site work and treatability study being conducted by
Chugach's contractors during the fall and winter of 1996- 1997 and EPA oversight
costs include all costs of overseeing work conducted under the AOC, including
the site work and treatability study. Because Chugach is currently funding the
RI/FS, the Partial Consent Decree requires the other PRPs to reimburse Chugach
and, in the event any PRP fails to make such reimbursement, the Partial Consent
Decree provides a credit to Chugach for the unreimbursed amounts. If applicable,
this credit will be applied to reduce Chugach's obligation to pay EPA oversight
costs so that the total amount paid by Chugach will not exceed 14.37% of the
costs being settled under the Partial Consent Decree.
The total estimated cost of the settlement under the Partial Consent Decree is
approximately $6,800,000 for Past Response Costs (including interest from
December 1991), RI/FS costs (including scrap and drum removal, site repair and
treatability study costs), DOJ enforcement costs (as compromised by the US) and
EPA oversight costs. This total cost is an estimate because costs (both RI/FS
and Oversight) have not been fully incurred in connection with the drum removal
and treatability study and because interest will continue to accrue on Past
Response Costs until paid by the PRPs. The Partial Consent Decree does not
settle Chugach's liability for future costs of designing and performing a remedy
to cleanup the Site (Future Costs). Applying Chugach's percentage share under
the Partial Consent Decree (14.37%), the total Chugach will have to pay to
settle all costs associated with the Site except Future Costs is approximately
$977,160.
Although the Consent Decree does not settle Chugach's or the other private PRPs'
liability for Future Costs, the Partial Consent Decree does bind the federal
PRPs and the Alaska Railroad to pay an aggregate share of 64% of Future Costs.
In addition, since the last report in the Form 10-Q, Chugach and the five other
private PRPs have reached a settlement to divide the remaining 36% of Future
Costs among themselves. The 36% of Future Costs will be allocated between the
private PCB (polychlorinated biphenyl) generators (Chugach and Westinghouse) and
the private lead generators (primarily Sears) in accordance with a 57% - 43%
allocation, respectively. Thus, assuming the private PCB generator share will be
divided 75% - 25% between Chugach and Westinghouse (as it has in the past),
Chugach's percentage share of liability for Future Costs will equal 15.39%.
Chugach's agreement to perform remedial design and remedial action (RD/RA) at
the Site will be memorialized in a new Consent Decree to be negotiated among the
private PRPs and the United States. This new Consent Decree is expected to
contain the scope of work for the RD/RA as well as settlement terms, including
EPA's covenant not to sue Chugach and the
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other private PRPs for Future Costs once the RD/RA is completed. Based on the
scope of work required under the ROD and cost estimates contained in the FS
report, the current estimate of Future Costs of RD/RA at the Site ranges from
$5,231,200 to $6,619,800. Although EPA has selected S/S as the cleanup remedy in
the ROD, the actual, full scope of the S/S cleanup at the Site will not be
known, and the projected costs associated with the remedy cannot be refined,
until EPA approves remedial design documents. Based on currently available
information, however, Chugach's share of Future Costs for RD/RA work at the Site
will be between approximately $805,082 and $1,018,787 (15.39% of estimated
low-end and high-end RD/RA costs). This amount is expected to be paid in
installments by Chugach as the RD/RA work is being performed throughout 1997 and
1998.
In addition to the RD/RA costs estimated above, EPA will charge Chugach and the
other PRPs the costs of EPA's oversight of the RD/RA. At this time, EPA has not
provided an estimate of RD/RA oversight costs. Based on the projected oversight
costs relating to the RI/FS and EPA oversight costs at other sites, EPA's RD/RA
oversight costs may be between $500,000 and $750,000. Combining Chugach's
anticipated costs under the Partial Consent Decree and projected share of costs
for the RD/RA (including EPA oversight costs), the total that Chugach may pay
for all costs associated with the Site ranges from approximately $1,859,192 to
$2,111,372.
Four of Chugach's insurance carriers have agreed under a reservation of rights
to pay, and currently are paying, Chugach's costs of defense for the Site. The
carriers have reserved their rights regarding indemnification of Chugach for
response costs. Management believes that all past and future costs incurred for
response, removal, investigation and cleanup of the Site would be fully
recoverable in rates or covered by insurance and therefore would have no impact
on Chugach's financial condition or results of operations.
Items 2, 3, 4 and 5
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Closing documents dated September 30, 1996 First Mortgage Bond,
CoBank Series (CoBank-4), Due June 15, 2022, pursuant to the Third
Supplemental Indenture of Trust.
Partial Consent Decree in Standard Steel Superfund Site matter.
Financial Data Schedule.
(b) Reports on Form 8-K:
No reports on Form 8-K were filed for the quarter ended September
30, 1996.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CHUGACH ELECTRIC ASSOCIATION, INC.
By: /s/ Eugene N. Bjornstad
Eugene N. Bjornstad, General Manager
Date: November 13, 1996
By: /s/ Evan J. Griffith, Jr.
Evan J. Griffith, Jr.
Executive Manager, Finance & Planning
Date: November 13, 1996
14
<PAGE>
EXHIBITS
Listed below are the exhibits which are filed as part of this Report:
Exhibit
number Description Page **
4.4.4 Closing documents dated September 30, 1996 First
Mortgage Bond, CoBank Series (CoBank-4), Due
June 15, 2022 pursuant to the Third Supplemental
Indenture of Trust. N/A
19.2 Partial Consent Decree in Standard Steel Superfund
Site matter. N/A
27 Financial Data Schedule N/A
** Filed Electronically
15
September 26, 1996
Mr. Michael Jones, CCTS
Assistant Vice President
First Trust National Association
601 Union Street, Suite 2120
Seattle, WA 98101
Subject: Request for Execution and Delivery of CoBank-4 Bond
Dear Mr. Jones:
Enclosed are the following original documents, including attachments, in
connection with the CoBank-4 bond in the amount of $23,500,000:
Opinion of Counsel,
Board Resolution,
First Mortgage Bond,
Certificate as to Bondable Additions No. 4,
Available Margins Certificate, and
Officers Certificate.
I have also enclosed a set of these documents for your files. Please execute the
bond and deliver it to the attention of John McFarlane at CoBank, P.O. Box 5110,
Denver, Colorado 80217. Would you also please provide Chugach a copy of the
executed bond for our files.
Thank you for your assistance in this transaction.
Sincerely,
/s/ Evan J. Griffith, Jr.
Evan J. Griffith, Jr.
Executive Manager, Finance & Planning
Enclosures Bond/letter
<PAGE>
First Trust National Association, as Trustee
September 26, 1996
Page 2
September 26, 1996
First Trust National Association, as Trustee
601 Union Street, Suite 2120
Seattle, Washington 98101
Attention: Michael Jones, Trust Officer
Re: Opinion of Counsel and Title Evidence in connection
with issuance of First Mortgage Bond, CoBank Series
Ladies and Gentlemen:
This letter constitutes the opinion of General Counsel for Chugach Electric
Association, Inc. ("Chugach") pursuant to Sections 5.01C, 5.01E, 5.02(5),
5.02(6), 5.02(7) and 5.03D of the Indenture of Trust dated as of September 15,
1991 between Chugach and First Trust National Association, successor-in-interest
to Security Pacific Bank Washington, N.A., as Trustee (the "Trustee") (as
amended by the First, Second, Third, Fourth, Fifth and Sixth Supplemental
Indentures thereto, dated March 17, 1993, May 19, 1994, June 29, 1994, March 1,
1995, September 6, 1995, and April 3, 1996 respectively, the "Indenture of
Trust") and the terms used in this opinion shall have the meanings established
therein. I have based my opinion on my review of the following records and
documents associated with the issuance of a First Mortgage Bond, CoBank Series
in the original principal amount of $23,500,000 Dollars (the "Bond") pursuant to
the Third Supplemental Indenture of Trust dated June 29, 1994 (the "Third
Supplemental Indenture"), which review is in my opinion sufficient to enable me
to express an informed opinion on the matters discussed in this letter:
The Bond;
Indenture of Trust;
Credit Agreement between Chugach and National Bank for Cooperatives
(predecessor to CoBank, ACB)("CoBank") dated June 22, 1994;
Board Resolution dated April 3, 1996, authorizing the issuance of a
First Mortgage Bond to CoBank pursuant to the Third Supplemental
Indenture;
Officers' Certificate dated September 26, 1996, signed by the General
Manager
<PAGE>
First Trust National Association, as Trustee
September 26, 1996
Page 3
and the Executive Manager, Finance and Planning;
Available Margins Certificate dated September 26, 1996;
Certificate as to Bondable Additions No. 4 dated September 26, 1996;
The articles of incorporation of Chugach (including all amendments
thereto); and
The bylaws of Chugach as in effect on the date hereof.
Based on my review of the above records and my knowledge of Chugach as General
Counsel, I am of the opinion that:
(1) no tax, recording or filing law requirements apply to the
issuance of the Bond;
(2) no authorization, approval or consent by any Federal, state or
other governmental regulatory agency is required for the issuance of the Bond;
(3) all conditions precedent provided for in the Indenture of Trust
relating to the authentication and delivery of the Bond to CoBank have been
complied with;
(4) the Bond, when executed by Chugach and authenticated and delivered
by the Trustee and when issued by Chugach will be the legal, valid and binding
obligation of Chugach enforceable in accordance with its terms and the terms of
the Indenture of Trust (subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other laws of general applicability relating to
or affecting creditors' rights and to general equity principles) and entitled to
the benefits of and secured by the lien of the Indenture of Trust equally and
ratably with all other Outstanding Secured Bonds;
(5) none of the Trust Estate is subject to any Prior Lien other
than Prior Liens permitted by Section 14.06 of the Indenture of Trust;
(6) no instruments, other than the Indenture of Trust, are necessary to
vest in the Trustee as a part of the Trust Estate all right, title and interest
of Chugach in and to all Property Additions to which the Certificate as to
Bondable Additions refers;
(7) with respect to all Property Additions to which the Certificate as
to Bondable Additions refers that are located or constructed on, over or under
public highways, rivers, waters or other public property, Chugach has the lawful
right under permits or franchises granted by a governmental body having
jurisdiction in the premises or by law to maintain and operate such Property
Additions for an unlimited, indeterminate or indefinite period of time
<PAGE>
First Trust National Association, as Trustee
September 26, 1996
Page 4
or for the period, if any, specified in such permit, franchise or law, and to
remove such property at the expiration of the period covered by such permit,
franchise or law, or the terms of such permit, franchise or law require any
public authority having the right to take over such property to pay fair
consideration therefor.
(8) Chugach has corporate power to own and operate all Property
Additions to which the Certificate as to Bondable Additions refers;
(9) the Indenture of Trust is a lien upon all Property Additions
described in the Certificate as to Bondable Additions (except such as have been
Retired) free and clear of any Prior Liens except to the extent otherwise
provided in Section 6.02D(2) of the Indenture of Trust;
(10) the documents which have been or are herewith delivered to the
Trustee conform to the requirements of the Indenture of Trust for an Application
for the authentication and delivery of the Bond and, upon the basis of the
Application, all conditions precedent provided for in the Indenture of Trust
relating to authentication and delivery of the Bond have been complied with;
(11) Chugach has title to the Property Additions described in the
Certificate as to Bondable Additions (except as have been Retired), free and
clear of any Prior Liens (except to the extent otherwise permitted by the
proviso to Section 6.02D(2) of the Indenture of Trust and except for Permitted
Encumbrances), and Chugach has duly obtained any easements or rights-of-way
which are described in the Certificate as to Bondable Additions, subject only to
Permitted Encumbrances; and
(12) to the extent Chugach's Application for authentication and
delivery of the Bond is based on satisfaction of the conditions described in
Section 5.03 of the Indenture of Trust, the evidence of repurchase of Bonds that
has been delivered to the Trustee conforms to the requirements of the Indenture
of Trust and, upon the basis of the relevant Application, the conditions
precedent to authentication and delivery of the Bond under Article Five of the
Indenture of Trust have been satisfied.
Pursuant to the definition of "Title Evidence" contained in Section 1.01 of the
Indenture of Trust, each of the foregoing opinions to the effect that Chugach
has title to any portion of the Trust Estate shall be deemed to be an opinion
only that Chugach has such title as in my opinion is satisfactory for the use
thereof in connection with its operations and is qualified by and subject to any
irregularity or deficiency in the record evidence of title which, in my opinion,
can be cured by proceedings within the power of Chugach or does not
substantially impair the usefulness of such property for the purposes of
Chugach.
<PAGE>
This opinion is limited to the federal laws of the United States of America and
the laws of the State of Alaska, and I disclaim any opinion as to the laws of
any other jurisdiction.
This opinion is rendered to you in connection with the issuance of the Bond and
is solely for your benefit. This opinion may not be relied upon by any other
person, firm, corporation or other entity without my prior written consent. I
disclaim any obligation to advise you of any change of law that occurs, or any
facts of which I become aware, after the date of this opinion.
Sincerely,
CHUGACH ELECTRIC ASSOCIATION, INC.
/S/ Donald W. Edwards
Donald W. Edwards
General Counsel
I:\cobnk235.ltr
<PAGE>
WHEREAS, the Board of Directors has previously approved and Chugach
Electric Association, Inc. ("Chugach") has entered into a Third Supplemental
Indenture of Trust dated as of June 29, 1994 between Chugach and Seattle-First
National Bank ("Third Supplemental Indenture") amending and supplementing that
Indenture of Trust dated as of September 15, 1991 (as heretofore amended, the
"Indenture") and establishing a new series of bonds to be designated First
Mortgage Bonds, CoBank Series, to be issued to Cobank, ACB (successor by merger
to National Bank for Cooperatives ("CoBank") pursuant to a Credit Agreement
dated June 22, 1994 from time to time to secure advances made by CoBank;
WHEREAS, it is in the best interest of Chugach for the Board of
Directors to authorize the issuance of a bond to CoBank under the Third
Supplemental Indenture for the purpose of securing indebtedness for
$23,500,000.00.
NOW THEREFORE BE IT RESOLVED, that the Board of Directors hereby
requests the authentication and delivery of a First Mortgage Bond, CoBank Series
(designated CoBank- 4), in the principal amount of $23,500,000.00, under
Sections 5.02 and 5.03 of the Indenture;
BE IT FURTHER RESOLVED, that the President, Vice President, Treasurer,
Secretary, General Manager and Executive Managers of Chugach, or any of them
(the "Officers and Managers") are and each of them hereby is, authorized,
empowered and directed, for and on behalf of Chugach, to execute and deliver, 1)
the First Mortgage Bond, CoBank Series, in the amount of $23,500,000.00, to bear
interest at the CoBank Fixed Rate Option in substantially the form attached
hereto, and 2) any Company Request, Application, Company Order or other document
or instrument that such person deems necessary or desirable in connection with
the issuance of such bond;
BE IT FURTHER RESOLVED, that the execution by such Officers and
Managers of the said Bond, instrument or other document and the doing by them of
any act in connection with the foregoing matters shall conclusively establish
their authority therefor from Chugach.
Certification
I, Mary Minder , do hereby certify that I am Secretary of Chugach Electric
Association, Inc. an electric non-profit cooperative membership corporation
organized and existing under the laws of the State of Alaska; that the foregoing
is a complete and correct copy of a resolution adopted at a meeting of the Board
of Directors of this corporation, duly and properly called and held on the 25th
day of September , 19 96; that a quorum was present at the meeting; that the
resolution is set forth in the minutes of the meeting and has not been rescinded
or modified.
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the seal of
this corporation this 25th day of September , 1996.
/s/ Mary Minder
(Seal) Secretary
<PAGE>
THIS FIRST MORTGAGE BOND, CoBANK SERIES, HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
SOLD, OFFERED FOR SALE OR OTHERWISE TRANSFERRED WITHOUT REGISTRATION
UNDER SUCH ACT OR IN RELIANCE UPON AN APPLICABLE EXEMPTION FROM
REGISTRATION UNDER SUCH ACT.
Chugach Electric Association, Inc.
First Mortgage Bond, CoBank Series, Due 6/15/22
No. CoBank-4 $23,500,000.00
Chugach Electric Association, Inc., an Alaska electric cooperative
(herein called the "Company", which term includes any successor corporation
under the Indenture hereinafter referred to), for value received, hereby
promises to pay to CoBank (the "Lender"), or registered assigns, (1) the
principal sum of $23,500,000.00 Dollars, (2) interest (computed on the basis of
a 360 day year) thereon, from the date of issuance, at the rate or rates
hereafter provided for, which interest shall be payable on each Regular Interest
Payment Date with respect to the principal balance Outstanding from time to time
during the calendar month most recently ended prior to such Regular Interest
Payment Date, and (3) a Redemption Premium in the amounts (if any) hereinafter
provided. The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, as provided in the Indenture described on the
reverse hereof, be paid to the Person in whose name this Bond (or one or more
predecessor Bonds) is registered at the close of business on the Regular Record
Date (as defined below) for such interest. Any such interest not so punctually
paid or duly provided for will forthwith cease to be payable to the Holder on
such Regular Record Date and may be paid to the Person in whose name this Bond
(or one or more Predecessor Bonds) is registered at the close of business on a
Special Record Date for the payment of such defaulted interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Bonds of this series
not less than 10 days prior to such Special Record Date.
Payments of the principal of (and premium, if any) and interest on this
Bond shall be made to the Holder hereof by wire transfer of immediately
available funds. Wire transfers will be made to ABA #307088754 for advice to and
credit of CoBank (or to such other account as the Holder hereof may designate by
notice) and shall be in time to be received prior to 1:00 p.m., Alaska time, on
the date each payment is due.
This Bond will mature on the date stated above. Interest only shall be
due until the first Principal Payment Date. The principal amount of this Bond
shall be repaid in accordance with the following amortization schedule:
Date 06/15/03 Principal Amount Due $ 452,151
Date 06/15/04 Principal Amount Due $ 493,500
Date 06/15/05 Principal Amount Due $ 538,616
Date 06/15/06 Principal Amount Due $ 587,859
Date 06/15/07 Principal Amount Due $ 641,586
Date 06/15/08 Principal Amount Due $ 700,156
Date 06/15/09 Principal Amount Due $ 764,198
Date 06/15/10 Principal Amount Due $ 834,071
Date 06/15/11 Principal Amount Due $ 910,311
Date 06/15/12 Principal Amount Due $ 993,458
Date 06/15/13 Principal Amount Due $1,084,319
Date 06/15/14 Principal Amount Due $1,183,431
Date 06/15/15 Principal Amount Due $1,291,513
Date 06/15/16 Principal Amount Due $1,409,641
Date 06/15/17 Principal Amount Due $1,538,443
Date 06/15/18 Principal Amount Due $1,679,084
Date 06/15/19 Principal Amount Due $1,832,552
Date 06/15/20 Principal Amount Due $2,000,011
Date 06/15/21 Principal Amount Due $2,182,809
Date 06/15/22 Principal Amount Due $2,382,291
Reference is hereby made to the further provisions of this Bond set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Bond
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Bond to be duly
executed.
Dated: September 26, 1996 CHUGACH ELECTRIC ASSOCIATION, INC.
--------------------------------------
Attest: /s/ Mary Minder By: /s/ Eugene N. Bjornstad
Secretary Authorized Officer
<PAGE>
This Bond is one of a duly authorized issue of Bonds of the Company
designated as its "First Mortgage Bonds" (herein called the "Bonds"), issued and
to be issued in one or more series under, all equally and ratably secured by, an
Indenture of Trust, dated as of September 15, 1991, (herein together with the
First Supplemental Indenture of Trust, dated as of March 17, 1993, the Second
Supplemental Indenture of Trust dated as of May 19, 1994, the Third Supplemental
Indenture of Trust dated as of June 29, 1994, the Fourth Supplemental Indenture
of Trust dated as of March 1, 1995, the Fifth Supplemental Indenture of Trust
dated as of September 6, 1995, and the Sixth Supplemental Indenture of Trust
dated as of April 3, 1996, called the "Indenture"), between the Company and
First Trust National Association (successor-in-interest to Security Pacific Bank
Washington, N.A.), as trustee (herein called the "Trustee", which term includes
any successor trustee under the Indenture), to which Indenture reference is
hereby made for a statement of the description of the properties thereby
mortgaged, pledged and assigned, the nature and extent of the security and the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee and the Holders of the Bonds and of the terms upon
which the Bonds are, and are to be, authenticated and delivered. This Bond is
one of the series and maturity designated on the face hereof, limited in
aggregate principal amount to the Maximum Amount (as defined below) at any one
time outstanding.
This Bond is subject to redemption at any time, upon at least twenty
(20) Business Days (as hereinafter defined) notice to the Holder hereof, as a
whole or in part in multiples of $1,000, at the election of the Company, at a
Redemption Price equal to 100% of the principal amount being redeemed plus the
Redemption Premium (as defined below), if any, with respect to the principal
amount hereof being redeemed, together with accrued interest to the Redemption
Date on the principal amount being redeemed, but interest installments whose
Stated Maturity is on or prior to such Redemption Date will be payable to the
Holder of this Bond, or one or more Predecessor Bonds, of record at the close of
business on the relevant Record Dates.
The Company has selected the Fixed Rate Option set forth in (B) below
for an initial period of 30 days at an interest rate of 6.30000 % per annum:
(A) Variable Rate Option. Except as provided below, the unpaid
principal balance of this CoBank Bond shall bear interest at a rate per annum
equal at all times to the National Variable Rate (as hereinafter defined) plus
25 basis points. For purposes hereof, the National Variable Rate shall mean the
rate of interest established by CoBank from time to time as its National
Variable Rate. The National Variable Rate is intended by CoBank to be a
reference rate, and CoBank may charge other borrowers rates at, above, or below
that rate. Any change in the National Variable Rate shall take effect on the
date established by CoBank as the effective date of such change, and CoBank
agrees to notify the Company promptly after any change in the rate.
(B) Fixed Rate Option. From time to time at the request of the
Company, the rate of interest charged on this CoBank Bond may be fixed at a rate
to be quoted by CoBank in its sole and absolute discretion. Under this option,
individual amounts may be fixed for periods ranging from thirty (30) days to the
life of the CoBank Bond, and the minimum aggregate principal amount of CoBank
Bonds on which the interest rate may be fixed at any one time shall be $100,000.
However, rates may only be fixed for periods which expire on a Business Day, and
shall take into account repayments of principal in accordance with the
amortization schedule. Upon the expiration of any fixed rate period, interest
shall automatically accrue at the rate set forth in (A) above, unless the amount
fixed is repaid or the Company fixes the rate for an additional period.
Until the principal hereof is completely repaid whether by reason of
maturity or redemption, interest on this Bond not theretofore paid shall be
payable, in arrears, on each Interest Payment Date with respect to the principal
balance outstanding from time to time during the Interest Period to which such
Interest Payment date relates. Interest shall be calculated on the actual number
of days this Bond is outstanding on the basis of a year consisting of 360 days.
In calculating interest, the first day of each period for which interest is
calculated shall be included and the day on which interest is paid shall be
excluded.
If prior to maturity of this Bond the Company fails to make any payment
required to be made hereunder or under the terms of the Credit Agreement, then
at the Holder's option in each instance, such payment shall bear interest from
the date due to the date such amount is paid in full at the Default Rate (as
hereafter defined). After maturity, whether by reason of acceleration or
otherwise, the entire indebtedness under this Bond shall automatically bear
interest at the Default Rate. All interest provided for in this provision shall
be payable on demand.
If an Event of Default with respect to the Bonds shall occur and be
continuing, the principal of the Bonds may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of Bonds under the Indenture at any time
by the Company with the consent of the Holders of a majority in aggregate
principal amount of Bonds of all series at the time outstanding affected by such
modification. The Indenture also contains provisions permitting the Holders of a
majority in principal amount of Bonds at the time Outstanding, on behalf of the
Holders of all Bonds to waive compliance by the Company with certain provisions
of the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Bond shall be
conclusive and binding upon such Holder and upon all future Holders of this Bond
and of any bond issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Bond.
No reference herein to the Indenture and no provisions of this Bond or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Bond at the times, places and rates, and in the coin or
currency, herein provided.
Pursuant to Section 34.20.160 of the Alaska Statutes, notice is hereby
given that the Company is personally obligated and fully liable for the amount
due under this Bond and the Holder of this Bond has the right to sue on this
Bond and obtain a personal judgment against the Company for satisfaction of the
amount due hereunder either before or after a judicial foreclosure of the lien
of the Indenture under Sections 09.45.170 through 09.45.220 of Alaska Statutes.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Bond is registrable in the Bond Register. Upon
surrender of this Bond for registration of transfer at the office or agency of
the company in Anchorage, Alaska, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Bond
Registrar duly executed by the Holder hereof or the Holder's attorney duly
authorized in writing, one or more new Bonds of this series, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Bonds of this series are issuable only in registered form without
coupons in denomination of $1,000 and any integral multiple thereof. As provided
in the Indenture and subject to certain limitations therein set forth, Bonds of
this series are exchangeable for a like aggregate principal amount of Bonds of
this series of a different authorized denomination, but of the same maturity and
interest rate or interest rate formula, as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Bond for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Bond is registered as the owner hereof for all
purposes, whether or not this Bond is overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
As used herein, the term:
"Business Day" means any day on which CoBank and the Trustee are open
for business.
"CoBank" means CoBank, ACB (as successor to National Bank for
Cooperatives by virtue of merger).
"CoBank Bond" means a First Mortgage Bond, CoBank Series.
"Credit Agreement" means that Credit Agreement secured hereby dated as
of June 22, 1994, between CoBank and the Company, as the same may be amended
from time to time, or such other Credit Agreement as may hereafter exist between
CoBank and the Company relating to the issuance of CoBank Bonds.
"Default Rate" means 4% per annum in excess of the rate or rates that
would otherwise be in effect.
"Interest Payment Date" with respect to any CoBank Bond means a Regular
Interest Payment Date with respect to such Bond.
"Interest Period" means a calendar month.
"Maturity Date" with respect to this CoBank Bond means the due date set
forth on the face hereof.
"Maximum Amount" of CoBank Bonds means Eighty Million Dollars
($80,000,000).
"National Variable Rate" shall mean the rate of interest established by
CoBank from time to time as its National Variable Rate. The National Variable
Rate is intended by CoBank to be a reference rate, and CoBank may charge other
borrowers rates at, above, or below that rate.
"Principal Payment Date" with respect to this CoBank Bond means each
date on which a payment of principal is required to be made on this CoBank Bond
pursuant to the amortization schedule set forth on the face hereof.
"Redemption Premium" with respect to this CoBank Bond means the premium
due upon the redemption or repricing of any portion of this CoBank Bond then
subject to a fixed rate of interest calculated by CoBank in accordance with its
methodology and equal to the present value of the difference between: (A) the
amount of interest which would have accrued on such portion during the remainder
of the applicable fixed rate period; less (B) the amount of interest that CoBank
would earn if such portion were reinvested for the remaining fixed rate period
in U.S. Treasury obligations having a weighted average life approximately equal
to the remaining fixed rate period. For the purpose of calculating present
value, the discount rate will be the rate of interest accruing on the U.S.
Treasury obligations selected in (B) above.
"Regular Interest Payment Date" with respect to this CoBank Bond means
the 20th day of each calendar month.
"Regular Record Date" for the payment of interest on this CoBank Bond
payable, and punctually paid or duly provided for, on any Interest Payment Date
means the last day (whether or not a Business Day) of the calendar month next
preceding such Interest Payment Date.
All other capitalized terms used in this Bond shall have the meanings
assigned to them in the Indenture.
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
FOR CoBANK BONDS
This is one of the Bonds of the series designated therein referred to
in the within-mentioned Indenture.
FIRST TRUST NATIONAL ASSOCIATION;
a national banking association, as Trustee
By: /S/ Michael A. Jones
Authorized Signatory
<PAGE>
CERTIFICATE AS TO BONDABLE ADDITIONS NO. 4
(Re Application for Authentication and Delivery of Bond CoBank-4)
Pursuant to Section 5.02 of the Indenture of Trust dated as of
September 15, 1991 from Chugach Electric Association, Inc. (the "Company") to
Security Pacific Bank Washington, N.A., as trustee, as modified and supplemented
by Supplemental Indentures No. 1, 2, 3, 4, 5 and 6 thereto dated March 17, 1993,
May 19, 1994, June 29, 1994, March 1, 1995, September 6, 1995 and April 3, 1996,
respectively (the "Indenture"), and in connection with the Company's request for
authentication and delivery of an additional Bond No. CoBank-4, the undersigned
hereby make this Certificate of Bondable Additions. Capitalized terms not
otherwise defined herein have the meanings assigned to them in the Indenture.
(a) The balance of Bondable Additions stated in item 9 of the most recent
(April 30, 1996) Summary of Certificate as to Bondable Additions
heretofore filed with the Trustee as the balance of Bondable Additions
to remain after the action then applied for, is $56,452,121 (item 1 in
the Summary of Certificate as to Bondable Additions set forth below
(the "Summary")).
(b) The Amount (item 2 in the Summary) of Property Additions, not described
in any previous Certificate as to Bondable Additions, acquired during
the period from January 1, 1996 through July 31, 1996, is $6,407,309.
Such Property Additions are described in reasonable detail on
Attachment 1 hereto, and:
i) have not been included in any previous Certificate as to
Bondable Additions;
ii) do not include Acquired Facilities or assets acquired and paid
for in whole or in partthrough the transfer or delivery of
securities or other property; and
iii) are listed in Attachment 1 at Cost, which in the opinion of
the undersigned is equal to their Fair Value to the Company.
(c) The aggregate amount (item 3 in the Summary) of all Retirements during
the period from January 1, 1996, through July 31, 1996, is $1,806,510.
(d) There are no credits (item 4 of the Summary) against Retirements.
(e) The excess (item 6 in the Summary) of the Amount of Property Additions
shown in (b) above (item 2 of the Summary) over the net amount of
Retirements (item 5 of the Summary) is $4,600,799, which is the amount
of the net Bondable Additions now being certified.
(f) The sum (item 7 of the Summary) of the amount shown pursuant to clause
(a) above (item 1) and the net amount of Bondable Additions now being
certified shown in clause (e) (item 6) above is $61,052,920.
(g) The total amount (item 8 in the Summary) of Bondable Additions being
used in connection with authentication and delivery of the additional
Bond whose authentication and delivery are now being applied for under
Section 5.02 of the Indenture is calculated as the bonds currently
being applied for less the bonds repurchased in June and September,
1996 times 110% or ($23,500,000 - 21,200,000) x 110% = $2,530,000.
(h) The balance (item 9 in the Summary) of the Bondable Additions that will
remain after the granting of the Application now being made is
$58,522,920.
(i) With respect to the Property Additions described in this Certificate:
i) such Property Additions are desirable in the conduct of the
business of the Company;
ii) the allocation of the Cost to the Company of such Property
Additions to each account is, in the opinion of the
undersigned, proper; and
iii) the balance of the Bondable Additions to remain after the
action applied for plus the Cost to the Company or the Fair
Value to the Company, whichever is less, of uncertified
Property Additions is at least equal to the aggregate amount
of uncertified Retirements.
(j) The allowances or charges (if any) for interest, taxes, engineering,
legal expenses, superintendence, insurance, casualties and other items
during construction (or in connection with the acquisition of Property
Additions) which are included in the Cost to the Company of such of the
Property Additions described in this Certificate as were constructed or
acquired by or for the Company have been charged and are properly
chargeable to fixed plant accounts in accordance with Accounting
Requirements and are, in the opinion of the signers, proper in respect
of the Property Additions specified;
<PAGE>
(k) No portion of the Cost to the Company of the Property Additions
described in this Certificate should properly have been charged to
maintenance or repairs and no expenditures are included in this
Certificate which under Accounting Requirements are not properly
chargeable to fixed plant accounts.
(l) The terms used in this Certificate which are defined in the Indenture
are used as defined in the Indenture.
<PAGE>
Summary of Certificate as to Bondable Additions No. 4
The undersigned certify the following to be a true summary of this
Certificate:
Start with:
1. The balance of Bondable Additions remaining after the
action applied for in the previous Certificate (Certificate
No. 3).....................................................$56,452,121
Then take the new gross Property Additions as shown in item 2 below:
2. Amount of additional Property Additions now certified,
being the Amount of all or some Property Additions in
the period from January 1, 1996 through July 31, 1996
(none of which has been certified in any previous
Certificate as to Bondable Additions)......................$ 6,407,309
Then determine the deductions for Retirements by deducting item 4 below from
item 3 below to produce item 5:
3. The aggregate amount of all Retirements....................$ 1,806,510
4. The sum of the credits against
Retirements................................................$ 0
5. The net amount of Retirements to be deducted...............$ 1,806,510
Then determine the net Bondable Additions now being certified by deducting item
5 from item 2 to produce item 6:
6. Net Bondable Additions now being
certified..................................................$ 4,600,799
Then add item 1 and item 6 to produce item 7:
7. Total Bondable additions available for the action applied
for........................................................$61,052,920
Deduct item 8 from item 7 to produce item 9:
8. Bondable Additions now being used..........................$ 2,530,000
9. Balance of Bondable Additions to remain after the
action applied for.........................................$58,522,920
<PAGE>
Dated September 26, 1996
/s/ Michael R. Cunningham
Michael R. Cunningham
Title: Principal Accounting Officer
(Accountant)
/s/ Evan J. Griffith, Jr.
Evan J. Griffith, Jr.
Title: Principal Financial Officer
/s/ Eugene N. Bjornstad
Eugene N. Bjornstad
Title: General Manager
(Engineer)
<PAGE>
CHUGACH ELECTRIC ASSOCIATION, INC.
ATTACHMENT 1 TO CERTIFICATE AS TO BONDABLE ADDITIONS NO. 4
NET CHANGES TO ELECTRIC PLANT
FOR THE PERIOD JANUARY, 1996 THROUGH JULY, 1996
<TABLE>
01/01/96- 01/01/96-
BALANCE 07/31/96 07/31/96 BALANCE
ACCOUNT DESCRIPTION 01/01/96 ADDITIONS RETIREMENTS 07/31/96
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PRODUCTION PLANT
31100 626 00 2101 STM - STRC & IMPR/BELUGA./OTHR/G&A. 7,349,213 0 0 7,349,213
31200 626 00 2101 STM - BLR PLT EQP/BELUGA./OTHR/G&A. 24,850,704 0 0 24,850,704
31400 626 00 2101 STM - TURBOGENR../BELUGA./OTHR/G&A. 20,716,146 0 0 20,716,146
31500 626 00 2101 STM - ACC ELEC EQ/BELUGA./OTHR/G&A. 6,932,778 0 0 6,932,778
31600 626 00 2101 STM -MISC PWR PLT/BELUGA./OTHR/G&A. 544,029 0 0 544,029
33100 621 00 2101 HYD - STRC & IMPR/GENERAL/OTHR/G&A. 690,040 0 0 690,040
33200 621 00 2101 HYD - RESV-DM-WW./GENERAL/OTHR/G&A. 5,666,600 0 0 5,666,600
33300 621 00 2101 HYD - WTWL-TR-GN./GENERAL/OTHR/G&A. 1,047,402 0 0 1,047,402
33400 621 00 2101 HYD - ACC ELEC EQ/GENERAL/OTHR/G&A. 371,914 0 0 371,914
33500 621 00 2101 HYD - MISC PW PLT/GENERAL/OTHR/G&A. 97,706 0 0 97,706
33600 621 00 2101 HYD - RESV-DM-WW./GENERAL/OTHR/G&A. 893,099 0 0 893,099
34000 626 00 2101 OTH - LAND&RIGHTS/BELUGA./OTHR/G&A. 422,664 0 0 422,664
34100 622 00 2101 OTH - STRC & IMPR/INTNATL/OTHR/G&A. 343,898 0 0 343,898
34100 624 00 2101 OTH - STRC & IMPR/BERNLKE/OTHR/G&A. 1,778,752 0 0 1,778,752
34100 626 00 2101 OTH - STRC & IMPR/BELUGA./OTHR/G&A. 20,837,294 24,880 0 20,862,174
34200 622 00 2101 OTH - FL HLDR-PRS/INTNATL/OTHR/G&A. 152,868 0 0 152,868
34200 624 00 2101 OTH - FL HLDR-PRS/BERNLKE/OTHR/G&A. 471,850 0 0 471,850
34200 626 00 2101 OTH - FL HLDR-PRS/BELUGA./OTHR/G&A. 3,040,258 0 0 3,040,258
34300 622 00 2101 OTH - PRIME MOVER/INTNATL/OTHR/G&A. 3,658,709 0 (15,745) 3,642,964
34300 624 00 2101 OTH - PRIME MOVER/BERNLKE/OTHR/G&A. 8,862,659 0 0 8,862,659
34300 626 00 2101 OTH - PRIME MOVER/BELUGA./OTHR/G&A. 48,479,504 40,378 0 48,519,882
34400 622 00 2101 OTH - GENERATORS./INTNATL/OTHR/G&A. 779,742 0 0 779,742
34400 624 00 2101 OTH - GENERATORS./BERNLKE/OTHR/G&A. 2,643,899 0 0 2,643,899
34400 626 00 2101 OTH - GENERATORS./BELUGA./OTHR/G&A. 8,941,743 0 0 8,941,743
34500 622 00 2101 OTH - ACC ELEC EQ/INTNATL/OTHR/G&A. 479,560 0 0 479,560
34500 624 00 2101 OTH - ACC ELEC EQ/BERNLKE/OTHR/G&A. 784,574 0 0 784,574
34500 626 00 2101 OTH - ACC ELEC EQ/BELUGA./OTHR/G&A. 3,660,329 0 0 3,660,329
34600 622 00 2101 OTH -MISC PWR PLT/INTNATL/OTHR/G&A. 19,465 0 0 19,465
34600 624 00 2101 OTH -MISC PWR PLT/BERNLKE/OTHR/G&A. 1,539 0 0 1,539
34600 626 00 2101 OTH -MISC PWR PLT/BELUGA./OTHR/G&A. 1,862,815 0 0 1,862,815
===============================================================
TOTAL PRODUCTION PLANT 176,381,753 65,258 (15,745) 176,431,266
===============================================================
TRANSMISSION PLANT
35000 000 00 2101 TRN - LD & LDRITS/GENERAL/OTHR/G&A. 316,165 0 0 316,165
35000 327 00 2101 TRN - LD & LDRITS/SUBTRANS/OTHR/G&A. 138,818 0 0 138,818
35200 000 00 2101 TRN - STRC & IMPR/GENERAL/OTHR/G&A. 692,856 0 0 692,856
35200 626 00 2101 TRN - STRC & IMPR/BELUGA./OTHR/G&A. 428,664 0 0 428,664
35300 000 00 2101 TRN - STATION EQP/GENERAL/OTHR/G&A. 31,499,053 0 0 31,499,053
35300 304 00 2101 TRN - STATION EQP/LDSRVMT/OTHR/G&A. 196,977 0 0 196,977
35300 626 00 2101 TRN - STATION EQP/BELUGA./OTHR/G&A. 38,649,029 0 0 38,649,029
35400 000 00 2101 TRN - TWR & FXTRS/GENERAL/OTHR/G&A. 5,378,824 0 0 5,378,824
35400 626 00 2101 TRN - TWR & FXTRS/BELUGA./OTHR/G&A. 26,890,112 0 0 26,890,112
35500 000 00 2101 TRN - POLES & FIX/GENERAL/OTHR/G&A. 8,765,796 197,094 (33,064) 8,929,826
35500 327 00 2101 TRN - POLES & FIX/SUBTRANS/OTHR/G&A. 32,060 0 0 32,060
35500 626 00 2101 TRN - POLES & FIX/BELUGA./OTHR/G&A. 1,074,661 0 0 1,074,661
35600 000 00 2101 TRN -OH CND & DVS/GENERAL/OTHR/G&A. 6,462,546 28,151 (25,557) 6,465,140
35600 327 00 2101 TRN -OH CND & DVS/SUBTRANS/OTHR/G&A. 15,750 0 0 15,750
35600 626 00 2101 TRN -OH CND & DVS/BELUGA./OTHR/G&A. 7,836,678 0 0 7,836,678
35700 000 00 2101 TRN - UG CONDUIT./GENERAL/OTHR/G&A. 562,221 0 0 562,221
35700 327 00 2101 TRN - UG CONDUIT./SUBTRANS/OTHR/G&A. 834,898 0 0 834,898
35700 626 00 2101 TRN - UG CONDUIT./BELUGA./OTHR/G&A. 0 0 0 0
35800 000 00 2101 TRN - UG CND & DV/GENERAL/OTHR/G&A. 3,553,187 0 0 3,553,187
35800 327 00 2101 TRN - UG CND & DV/SUBTRANS/OTHR/G&A. 1,464,557 0 0 1,464,557
35800 626 00 2101 TRN - UG CND & DV/BELUGA./OTHR/G&A. 54,995,692 0 0 54,995,692
35900 626 00 2101 TRN-RDS & TRL-BLG/BELUGA./OTHR/G&A. 4,000 0 0 4,000
===============================================================
TOTAL TRANSMISSION PLANT 189,792,544 225,245 (58,621) 189,959,168
===============================================================
DISTRIBUTION PLANT
36000 000 00 2101 DIS - LD & LDRITS/GENERAL/OTHR/G&A. 805,759 0 0 805,759
36100 000 00 2101 DIS - STRUC & IMP/GENERAL/OTHR/G&A. 1,817,354 0 0 1,817,354
36200 000 00 2101 DIS - STATION EQP/GENERAL/OTHR/G&A. 19,047,700 0 (52,358) 18,995,342
36400 000 00 2101 DIS - POLES-TW&FX/GENERAL/OTHR/G&A. 14,469,986 1,092,742 (391,131) 15,171,597
36500 000 00 2101 DIS - OH CND & DV/GENERAL/OTHR/G&A. 9,088,784 635,032 (502,523) 9,221,293
36600 000 00 2101 DIS - UG CONDUIT./GENERAL/OTHR/G&A. 7,329,114 145,503 (26,950) 7,447,667
36700 000 00 2101 DIS - UG CND & DV/GENERAL/OTHR/G&A. 32,133,236 2,689,559 (304,943) 34,517,852
36800 000 00 2101 DIS - LINE TRNSFR/GENERAL/OTHR/G&A. 18,210,333 993,160 (178,967) 19,024,526
36900 000 00 2101 DIS - SERVICES.../GENERAL/OTHR/G&A. 19,150,343 186,963 (55,371) 19,281,935
37000 000 00 2101 DIS - METERS...../GENERAL/OTHR/G&A. 6,782,629 71,386 (126,221) 6,727,794
37100 000 00 2101 DIS-INSTL CUS PRM/GENERAL/OTHR/G&A. 331,356 0 0 331,356
37300 000 00 2101 DIS-ST LTS & SIGN/GENERAL/OTHR/G&A. 8,066,755 35,634 (71,620) 8,030,769
===============================================================
TOTAL DISTRIBUTION PLANT 137,233,349 5,849,979 (1,710,084) 141,373,244
===============================================================
GENERAL PLANT
38900 000 00 2101 GEN - LD & LDRITS/GENERAL/OTHR/G&A. 122,063 0 0 122,063
38910 000 00 2101 GEN - LD IMPROVMT/GENERAL/OTHR/G&A. 65,097 0 0 65,097
39000 000 00 2101 GEN - STRC & IMPR/GENERAL/OTHR/G&A. 19,175,653 7,182 0 19,182,835
39000 310 00 2101 GEN - STRC & IMPR/LSHLDIM/OTHR/G&A. 198,601 0 0 198,601
39000 311 00 2101 GEN - STRC & IMPR/S&VSTRU/OTHR/G&A. 96,438 0 0 96,438
39100 000 00 2101 GEN-OFC FURN & EQ/GENERAL/OTHR/G&A. 1,858,569 11,418 0 1,869,987
39100 321 00 2101 GEN-OFC FURN & EQ/DPEQUIP/OTHR/G&A. 3,830,544 204,054 (20,575) 4,014,023
39200 000 00 2101 GEN - TRANSP EQMT/GENERAL/OTHR/G&A. 5,000,807 7,699 0 5,008,506
39300 000 00 2101 GEN - STORES EQMT/GENERAL/OTHR/G&A. 1,198,844 0 0 1,198,844
39400 000 00 2101 GEN -TL-SHP & GAR/GENERAL/OTHR/G&A. 1,291,955 15,688 0 1,307,643
39500 000 00 2101 GEN - LAB EQUIPMT/GENERAL/OTHR/G&A. 2,001,258 15,678 0 2,016,936
39600 000 00 2101 GEN - PWR OP EQMT/GENERAL/OTHR/G&A. 1,250,795 4,950 (952) 1,254,793
39600 323 00 2101 GEN - PWR OP EQMT/GENTRAN/OTHR/G&A. 760,633 43,790 0 804,423
39800 000 00 2101 GEN - MISC EQUIPT/GENERAL/OTHR/G&A. 1,009,536 132,679 0 1,142,215
39800 340 00 2101 GEN - MISC EQUIPT/BARGE../OTHR/G&A. 0 0 0 0
===============================================================
TOTAL GENERAL PLANT 37,860,793 443,138 (21,527) 38,282,404
===============================================================
COMMUNICATION PLANT
39700 000 00 2101 GEN - COMM EQUIPT/GENERAL/OTHR/G&A. 2,732,609 6,517 (1,485) 2,737,641
39700 330 00 2101 GEN - COMM EQUIPT/MICROWV/OTHR/G&A. 6,540,561 0 0 6,540,561
39700 331 00 2101 GEN - COMM EQUIPT/SCADA../OTHR/G&A. 3,012,280 0 0 3,012,280
39700 333 00 2101 GEN - COMM EQUIPT/TELESYS/OTHR/G&A. 305,416 6,290 0 311,706
39700 338 00 2101 GEN - COMM EQUIPT/ORSCADA/OTHR/G&A. 8,875,262 0 0 8,875,262
===============================================================
TOTAL COMMUNICATION PLANT 21,466,128 12,807 (1,485) 21,477,450
===============================================================
----------------
TOTAL PLANT 562,734,567 6,596,427 (1,807,462) 567,523,532
===============================================================
LESS EXCLUDABLE PLANT
39200 000 00 2101 GEN - TRANSP EQMT/GENERAL/OTHR/G&A. 5,000,807 7,699 0 5,008,506
39600 000 00 2101 GEN - PWR OP EQMT/GENERAL/OTHR/G&A. 1,250,795 4,950 (952) 1,254,793
39600 323 00 2101 GEN - PWR OP EQMT/GENTRAN/OTHR/G&A. 760,633 43,790 0 804,423
39800 000 00 2101 GEN - MISC EQUIPT/GENERAL/OTHR/G&A. 1,009,536 132,679 0 1,142,215
39800 340 00 2101 GEN - MISC EQUIPT/BARGE../OTHR/G&A. 0 0 0 0
===============================================================
TOTAL EXCLUDABLE PLANT 8,021,771 189,118 (952) 8,209,937
===============================================================
TOTAL INCLUDABLE PLANT 554,712,796 6,407,309 (1,806,510) 559,313,595
===============================================================
</TABLE>
Chugach Electric Association, Inc.
Available Margins Certificate
Eugene N. Bjornstad, General Manager; Evan J. Griffith, Jr., Executive
Manager, Finance and Planning (Principal Financial Officer); and Michael R.
Cunningham, Controller (Principal Accounting Officer) of Chugach Electric
Association, Inc. each hereby certifies that (1) the Margins for Interest for
any 12 consecutive calendar months during the period of 18 calendar months
immediately preceding the first day of the calendar month in which this
application for authentication and delivery of Additional Bonds under Section
5.02 of the Indenture described below is made are not less than 1.20 times the
Interest Charges during such 12-month period; (2) the sum of (i) Margins for
Interest for any 12 consecutive calendar months during the period of 18 calendar
months immediately preceding the first day of the calendar month in which this
Application for authentication and delivery of additional Bonds under Section
5.02 is made and (ii) Incremental Interest with respect to such 12-month period,
is not less than 1.20 times the sum of Interest Charges during such 12-month
period plus Incremental Interest with respect to such 12-month period; and (3)
the Margins for Interest have been calculated in accordance with the definition
contained in Section 1.01 of that Indenture of Trust dated September 15, 1991
(as heretofore amended by the First, Second, Third, Fourth, Fifth and Sixth
Supplemental Indentures, thereto dated March 17, 1993, May 19, 1994, June 29,
1994 and March 1, 1995, September 6, 1995 and April 3, 1996 respectively (the
"Indenture") and such calculations are set forth in the Attachment 1 hereto.
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture.
IN WITNESS WHEREOF, we have hereunto signed our names.
Dated: September 26, 1996
/s/ Eugene N. Bjornstad /s/ Michael R. Cunningham
Eugene N. Bjornstad Michael R. Cunningham
Title: General Manager Title: Controller
Principal Accounting Officer
/s/ Evan J. Griffith, Jr.
Evan J. Griffith, Jr.
Title: Executive Manager,
Finance and Planning
Principal Financial Officer Page 1 of 1
<PAGE>
<TABLE>
Attachment 1 to Available Margins Certificate
Long-Term Short-Term Total Margins For Interest 12 Month
Month Ending Margins Interest Expense Interest Expense Interest Expense By Interest MFI/I
<S> <C> <C> <C> <C> <C>
December, 1994 875,537 2,152,924 47,201 2,200,125 1.3979
January, 1995 2,753,024 2,154,951 43,380 2,198,331 2.2523
February, 1995 2,081,124 2,170,265 20,364 2,190,629 1.9500
March, 1995 1,658,056 2,137,301 60,369 2,197,670 1.7545
April, 1995 969,717 2,124,949 99,714 2,224,663 1.4359
May, 1995 608,466 2,119,671 91,275 2,210,946 1.2752
June, 1995 (709,557) 2,124,722 69,735 2,194,457 0.6767
July, 1995 (432,272) 2,119,441 58,490 2,177,931 0.8015
August, 1995 (343,437) 2,121,479 54,489 2,175,968 0.8422
September, 1995 (106,783) 2,188,637 22,082 2,210,719 0.9517
October, 1995 629,101 2,185,136 32,438 2,217,574 1.2837
November, 1995 1,003,392 2,188,054 26,301 2,214,355 1.4531 1.3402
December, 1995 895,363 1,925,118 33,736 1,958,854 1.4571 1.3441
January, 1996 2,068,780 2,230,499 42,036 2,272,535 1.9103 1.3171
February, 1996 968,678 1,930,124 19,475 1,949,599 1.4969 1.2772
March, 1996 589,008 693,932 124,422 818,354 1.7197 1.2493
April, 1996 2,062,121 3,602,249 171,516 3,773,765 1.5464 1.2763
May, 1996 (129,442) 2,141,672 66,000 2,207,672 0.9414 1.2482
June, 1996 (236,002) 2,088,291 77,386 2,165,677 0.8910 1.2666
Page 1 of 2
</TABLE>
<TABLE>
Attachment 1 to Available Margins Certificate
Less: Int @ Plus:Int @
9.14%on $20.000 6.25% on Adj Adjusted
Long-Term Short-Term Total Million O/S $22.000M Total Int Adjusted 12 Month
Month Ending Margins Int Exp Int Exp Int Exp 1ST Mort Bonds CoBank Bond Expense MFI/I MFI/I
------------ ------- ---------- --------- -------- --------------- -------------- ------- --------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
December, 1994 875,537 2,152,924 47,201 2,200,125 152,333 114,583 2,162,375 1.4049
January, 1995 2,753,024 2,154,951 43,380 2,198,331 152,333 114,583 2,160,581 2.2742
February, 1995 2,081,124 2,170,265 20,364 2,190,629 152,333 114,583 2,152,879 1.9667
March, 1995 1,658,056 2,137,301 60,369 2,197,670 152,333 114,583 2,159,920 1.7676
April, 1995 969,717 2,124,949 99,714 2,224,663 152,333 114,583 2,186,913 1.4434
May, 1995 608,466 2,119,671 91,275 2,210,946 152,333 114,583 2,173,196 1.2800
June, 1995 (709,557) 2,124,722 69,735 2,194,457 152,333 114,583 2,156,707 0.6710
July, 1995 (432,272) 2,119,441 58,490 2,177,931 152,333 114,583 2,140,181 0.7980
August, 1995 (343,437) 2,121,479 54,489 2,175,968 152,333 114,583 2,138,218 0.8394
September, 1995 (106,783) 2,188,637 22,082 2,210,719 152,333 114,583 2,172,969 0.9509
October, 1995 629,101 2,185,136 32,438 2,217,574 152,333 114,583 2,179,824 1.2886
November, 1995 1,003,392 2,188,054 26,301 2,214,355 152,333 114,583 2,176,605 1.4610 1.3462
December, 1995 895,363 1,925,118 33,736 1,958,854 152,333 114,583 1,921,104 1.4661 1.3502
January, 1996 2,068,780 2,230,499 42,036 2,272,535 152,333 114,583 2,234,785 1.9257 1.3226
February, 1996 968,678 1,930,124 19,475 1,949,599 152,333 114,583 1,911,849 1.5067 1.2821
March, 1996 589,008 693,932 124,422 818,354 152,333 114,583 780,604 1.7546 1.2540
April, 1996 2,062,121 3,602,249 171,516 3,773,765 152,333 114,583 3,736,015 1.5520 1.2812
May, 1996 (129,442) 2,141,672 66,000 2,207,672 152,333 114,583 2,169,922 0.9403 1.2525
June, 1996 (236,002) 2,088,291 77,386 2,165,677 152,333 114,583 2,127,927 0.8891 1.2713
Page 2 of 2
</TABLE>
Chugach Electric Association, Inc.
Officers' Certificate
Eugene N. Bjornstad, General Manager, and Evan J. Griffith, Jr., Executive
Manager, Finance and Planning of Chugach Electric Association, Inc. ("Chugach")
each hereby certifies that: 1) he has read the conditions and covenants and
definitions related thereto in the Indenture of Trust dated as of September 15,
1991 (as heretofore amended, the "Trust Indenture"); 2) the below opinions are
based on the above review and on his knowledge of Chugach in the above capacity;
3) he has, in his opinion, made such examination or investigation as is
necessary to enable him to express an informed opinion as to the opinions
expressed below; and 4) in accordance with Sections 5.01 B and 5.03 C of the
Trust Indenture:
(i) No Event of Default exists;
(ii) None of the Trust Estate is subject to any Prior Lien other
than Prior Liens permitted by Section 14.06 of the Trust Indenture;
(iii) In his opinion, all conditions precedent provided for in the
Trust Indenture relating to the authentication and delivery of the
First Mortgage Bond, CoBank Series No. CoBank-4 ("CoBank-4 Bond") in
the principal amount of $23,500,000.00, have been complied with;
(iv) Pursuant to the Trust Indenture Section 5.03 B., in lieu of
delivering Bonds to the Trustee, Chugach has conveyed evidence by
facsimiles dated August 19, 1996 and September 9, 1996 of repurchase of
Bonds heretofore authenticated and delivered under this Indenture in an
aggregate principal amount equal to $21,200,000 ("Repurchased Bonds")
and has demonstrated thereby that these Repurchased Bonds have ceased
to be outstanding.
(v) The Repurchased Bonds being made the basis, in part, for the
authentication and delivery of the CoBank-4 Bond do not include:
(a) any Bonds which shall have heretofore been made, or are
currently being otherwise made, the basis for the
authentication and delivery of bonds or the withdrawal or
application of Deposited Cash or Trust Moneys; or
(b) any Bonds (1) whose payment, redemption or other
retirement, or provision therefor, has been effected through
the operation of any sinking, amortization, improvement or
other analogous fund and (ii) whose use under Article Five of
the Trust Indenture is precluded by any provision of the Trust
Indenture; or
Page 1 of 2
<PAGE>
(c) any Bond which has been surrendered upon any exchange or
transfer or any Bond in lieu of which another Bond has been
authenticated and delivered under Section 3.08 of the Trust
Indenture; or
(d) any Bond which, in accordance with the last paragraph of
Section 5.01 of the Trust Indenture is treated as though it
had never been Outstanding;
(vi) at no time after the authentication and delivery of any of the
Repurchased Bonds being made the basis for the authentication and
delivery of CoBank-4 Bond, has there been filed with the Trustee an
Available Margins Certificate in which the annual interest charges on
such Repurchased Bonds were not included;
(vii) the CoBank-4 Bond does not bear interest at a rate greater than
any of the Repurchased Bonds which are being made the basis for the
authentication and delivery of CoBank-4 Bond.
Capitalized terms not otherwise defined in this Certificate have the meanings
assigned to them in the Trust Indenture.
IN WITNESS WHEREOF, we have hereunto signed our names.
Dated: September 26, 1996
/s/ Eugene N. Bjornstad
Eugene N. Bjornstad
Title: General Manager
/s/ Evan J. Griffith, Jr.
Evan J. Griffith, Jr.
Title: Executive Manager
Finance and Planning
Principal Financial Officer
Page 2 of 2
<PAGE>
LOIS J. SCHIFFER
Assistant Attorney General
Environment and Natural Resources Division
MICHAEL D. ROWE
Environmental Defense Section
Environment & Natural Resources Division
United States Department of Justice
P.O. Box 23986 L'Enfant Plaza Station
Washington, D.C. 20026-3986
Telephone: (202) 514-3144
Facsimile: (202) 514-2584
REGINA R. BELT
Environmental Enforcement Section
Environment and Natural Resources Division
United States Department of Justice
801 B Street Suite 504
Anchorage, Alaska 99501-3657
Telephone: (907) 271-3456
Facsimile: (907) 271-5827
Attorneys for the United States
IN THE UNITED STATES DISTRICT COURT
DISTRICT OF ALASKA
UNITED STATES OF AMERICA,
Plaintiff,
v.
ALASKA RAILROAD CORPORATION,
CHUGACH ELECTRIC ASSOCIATION,
INC., WESTINGHOUSE ELECTRIC
CORPORATION, SEARS, ROEBUCK AND
CO., MONTGOMERY WARD & CO., INC.,
J.C. PENNEY COMPANY, INC.,
BRIDGESTONE/FIRESTONE, INC.,
Defendants.
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No. A91-0589-CV (JWS)
PARTIAL CONSENT DECREE
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CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 1
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TABLE OF CONTENTS
I. BACKGROUND............................................ 3
II. JURISDICTION.......................................... 5
III. PARTIES BOUND......................................... 5
IV. DEFINITIONS........................................... 6
V. PAST RESPONSE, DOJ ENFORCEMENT, RI/FS,
AND OVERSIGHT COSTS................................... 12
o PAYMENT AND REIMBURSEMENT
OF COSTS..................................... 12
o FAILURE TO COMPLY WITH REQUIREMENTS
OF CONSENT DECREE............................ 19
o COVENANTS BY PLAINTIFF;
RESERVATIONS OF RIGHTS....................... 21
o COVENANTS BY THE SETTLING PRPS............... 23
o EFFECT OF SETTLEMENT; CONTRIBUTION
PROTECTION: ACTIONS.......................... 25
VI. AGREEMENTS REGARDING FUTURE COSTS..................... 28
VII. SITE ACCESS AND COOPERATION........................... 36
VIII. RETENTION OF RECORDS.................................. 37
IX. NOTICES AND SUBMISSIONS............................... 40
X. FEDERAL CONTRACTING................................... 42
XI. ANTI-DEFICIENCY ACT PROVISION......................... 42
XII. RETENTION OF JURISDICTION............................. 43
XIII. INTEGRATION AND APPENDICES............................ 43
XIV. LODGING AND OPPORTUNITY FOR PUBLIC COMMENT............ 43
XV. SIGNATORIES AND SERVICE............................... 44
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I. BACKGROUND
A. The United States of America ("United States"), on behalf of the
Administrator of the United States Environmental Protection Agency ("EPA"),
filed a complaint in this matter pursuant to Section 107(a) of the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. ss.
9607(a), as amended ("CERCLA"), seeking reimbursement of response costs incurred
and to be incurred for response actions taken at or in connection with the
release or threatened release of hazardous substances at the Standard Steel and
Metals Salvage Yard Superfund Site in Anchorage, Alaska (the "Site" or the
"Standard Steel Site").
B. Defendant Chugach Electric Association, Inc. ("Chugach")
subsequently entered into an Administrative Order on Consent ("AOC") with EPA,
pursuant to which Chugach has performed a Remedial Investigation and Feasibility
Study ("RI/FS") for the Site and is performing additional work at the Site. The
AOC, as amended by this Partial Consent Decree, also provides for payment by
Chugach of 38.5% of response costs incurred or to be incurred by the United
States in the course of overseeing performance of the RI/FS and implementing the
AOC ("Oversight Costs" (defined in Section IV. below)).
C. Some of the Defendants have alleged that certain federal agencies and
instrumentalities are among the classes of persons identified in Section 107(a)
of CERCLA as liable for response costs incurred with respect to the Site. These
federal agencies and
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instrumentalities (the "Settling Federal Entities") have entered into a separate
Funding Agreement with Chugach (the "First Funding Agreement"), pursuant to
which the Settling Federal Entities are reimbursing to Chugach 75% of RI/FS
Costs (defined in Section IV. below), exclusive of Scrap Removal Costs (defined
in Section IV. below). Pursuant to the First Funding Agreement, as amended by
this Partial consent Decree, the Settling Federal Entities have agreed to fund
61.5% of Oversight Costs.
D. In order to gain access to the Site to perform the RI/FS, a large
volume of scrap metal and debris was required to be removed from the Site, and,
pursuant to a Second Funding Agreement for Removal of Scrap (the "Second Funding
Agreement"), the Settling Federal Entities and all of the Defendants other than
Sears, Roebuck and Co. paid for the costs of that scrap removal.
E. The United States and the Defendants ("the Parties") have now agreed
to settle the United States' claims for Past Response Costs (defined in Section
IV. below), DoJ Enforcement Costs (defined in Section IV. below), and Oversight
Costs, and the Settling Federal Entities and the Defendants have decided to
allocate among themselves RI/FS Costs, Oversight Costs, Past Response Costs and
DoJ Enforcement Costs. Further, the Settling Federal Entities and Defendant
Alaska Railroad Corporation have agreed to pay for a fixed percentage of Future
Costs (defined in Section IV. below) and to allocate those costs between them,
and the remaining Defendants have further agreed that this fixed percentage
shall be the fair share of ARRC and the Settling Federal
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Entities in contribution for Future Costs.
F. The Defendants do not admit any liability to the United States
arising out of the transactions or occurrences alleged in the Complaint. The
Settling Federal Entities do not admit any liability arising out of the
transactions or occurrences alleged in any counterclaim asserted by the
Defendants.
G. The Parties agree, and this Court by entering this Partial Consent
Decree ("Decree") finds, that this Decree has been negotiated in good faith,
will avoid prolonged and complicated litigation between and among the Parties
and that entry of this Decree is fair, reasonable, and in the public interest.
NOW, THEREFORE, with the consent of the Parties to this Decree, it is
ORDERED, ADJUDGED, AND DECREED:
II. JURISDICTION
1. This Court has jurisdiction over the subject matter of this action pursuant
to 28 U.S.C. ss.ss. 1331 and 1345 and 42 U.S.C. ss.ss. 9607 and 9613(b) and also
has personal jurisdiction over the Defendants. For purposes of this Decree, the
Parties agree not to challenge this Court's jurisdiction to enter, modify,
enforce and/or terminate this Decree.
III. PARTIES BOUND
2. This Decree shall apply to and be binding upon the United States,
and upon each of the Defendants and their successors and assigns. Any change in
ownership or corporate or other legal status, including, but not limited to, any
transfer of assets or real or personal property, shall in no way alter the
status or
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responsibilities of the Defendants under this Decree.
IV. DEFINITIONS
3. Unless otherwise expressly provided herein, terms used in this
Decree which are defined in CERCLA or in regulations promulgated under CERCLA
shall have the meaning assigned to them in CERCLA or in such regulations.
Whenever the terms listed below are used in this Decree, the following
definitions shall apply:
a. "Administrative Order on Consent" or "AOC" shall mean the
Administrative Order on Consent between EPA and Chugach Electric
Association, Inc. effective as of September 25, 1992, as amended on
July 6 and October 24, 1994, pursuant to which Chugach has performed a
Remedial Investigation and Feasibility Study for the Standard Steel
Site and is performing additional work at the Site. Paragraphs 21.1,
21.2, 21.3, and 21.4 of the AOC are amended in part by Paragraphs
5.b.i., 5.b.ii., 5.d., 5.e., and 5.f.i. of this Decree. Except for
paragraphs 21.1, 21.2, 21.3, and 21.4, all of the terms and conditions
of the AOC, as previously amended, are in full force and effect and are
not affected by this Decree. A copy of the AOC, inclusive of the 1994
amendments, is attached as Appendix 1 to this Decree. b. "Aliquot
Share" shall mean the percentage of Past Response Costs, DoJ
Enforcement Costs, RI/FS Costs and Oversight Costs that the Defendants
and the Settling Federal Entities have agreed each of them will pay or
otherwise incur under this Decree.
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c. "CERCLA" shall mean the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended,
42 U.S.C. ss.ss. 9601-9675.
d. "Credit" shall mean, as to Chugach, the difference, if
any, between the amount of RI/FS Costs and Oversight Costs
expended or owed by Chugach under the AOC and this Decree, as
reduced by all amounts actually reimbursed to it under this
Decree and the First Funding Agreement, as amended by this
Decree, and Chugach's Aliquot Share (14.37%) of the aggregate
of RI/FS Costs and oversight Costs. As to the Settling
Federal Entities, "Credit" shall mean the difference, if any,
between the amount of RI/FS Costs expended by the Settling
Federal Entities by way of payments to Chugach under the First
Funding Agreement together with the amount of Scrap Removal
Costs paid by them pursuant to the Second Funding Agreement,
as reduced by all amounts actually reimbursed to the Settling
Federal Entities under this Decree, and the amount of the
Settling Federal Entities' Aliquot Share (61.50%) of RI/FS
Costs.
e. "Day" shall mean a calendar day. In computing any period
of time under this Decree, where the last day of the period
would fall on a Saturday, Sunday or federal holiday, the
period shall run until the close of business the next working
day.
f. "Decree" shall mean this Partial Consent Decree.
g. "Defendants" shall mean the Alaska Railroad Corporation
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("ARRC"), Chugach Electric Association, Inc. ("Chugach")
Westinghouse Electric corporation ("Westinghouse"), Sears,
Roebuck and Co. ("Sears"), Montgomery Ward & Co., Inc.
("Ward"), J.C. Penney Company, Inc. ("J.C. Penney"), and
Bridgestone/Firestone, Inc. ("B/F").
h. "DoJ" shall mean the United States Department of Justice
and any successor departments, agencies or instrumentalities
of the United States.
i. "DoJ Enforcement Costs" shall mean, solely for purposes
of this Decree, all costs, including but not limited to direct
and indirect costs, that DoJ has paid or incurred in
connection with the Site through the Effective Date of this
Decree, including, but not limited to, costs of litigating
this action and negotiating the AOC, and Interest on all such
costs through the Effective Date, all of which shall be
limited to the sum of $150,000.
j. "Effective Date" shall mean the date upon which this
Decree is entered by the Court.
k. "EPA" shall mean the United States Environmental
Protection Agency and any successor departments, agencies or
instrumentalities of the United States.
l. "Expenditure Date" shall mean, as to Chugach, the date of
each payment demand transmitted by Chugach to the Settling
Federal Entities pursuant to the First Funding Agreement and,
as to the Settling Federal Entities, the date each payment was
issued by the Settling Federal Entities to Chugach pursuant to
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the First Funding Agreement.
m. "First Funding Agreement" shall mean the agreement between Chugach
and the Settling Federal Entities, pursuant to which the Settling
Federal Entities are funding 75% of the RI/FS Costs at the Site. A copy
of the First Funding Agreement constitutes Appendix 2 of this Decree.
n. "Future Costs" shall mean all costs recoverable under CERCLA that
are incurred with respect to the Site after issuance by EPA of its
Record of Decision ("ROD") (as defined below), including, but not
limited to: (1) damages for injury to, destruction of, or loss of
natural resources and costs of assessments thereof; (2) costs incurred
in designing and performing the remedy selected by EPA in the ROD, or
any amended ROD, along with costs for long-term operation, maintenance
and monitoring; and (3) the United States' enforcement costs and costs
of overseeing design and performance of the remedy selected by EPA in
the ROD, or any amended ROD. Future Costs shall not include costs
incurred pursuant to the AOC no matter when incurred. o. "Interest"
shall mean interest at the current rate specified for interest on
investments of the Hazardous Substance Superfund established by 26
U.S.C. ss. 9507, compounded annually on October 1 of each year, in
accordance with 42 U.S.C. ss. 9607(a). p. "Non-Funding Settlers" shall
mean those Defendants that did not sign or participate in the AOC and
First Funding
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Agreement for performance of the RI/FS at the Site, but are now
signatories to this Decree. The Non-Funding Settlers are ARRC,
Westinghouse, Sears, Ward, J.C. Penney, and B/F. q. "Oversight Costs"
shall have the same meaning as "Response Costs" in paragraph 21.1 of
the AOC, as amended on July 6, 1994, and includes costs EPA will incur,
or has incurred, in negotiating and defending this Decree and the
Partial Consent Decree lodged with the Court in this action on June 22,
1994. "Oversight Costs" shall include litigation expenses EPA has
incurred or will incur through the Effective Date of this Decree. r.
"Paragraph" shall mean a portion of this Decree identified by an Arabic
numeral or an upper or lower case letter. s. "Parties" shall mean the
United States, including the Settling Federal Entities, and the
Defendants. t. "Past Response Costs" shall mean all costs, including,
but not limited to, direct and indirect costs that EPA has incurred in
connection with CERCLA response actions related to the Site through and
until December 31, 1991, i.e., $2,334,078.37, plus Interest accrued on
such costs from the date of filing of the complaint in this action
through the date that payment of Past Response Costs is due under this
Decree, minus $200,000. For purposes of this Decree only, Past Response
Costs shall not include costs incurred by the United States after
December 31, 1991.
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u. "Private PRPS" shall mean B/F, Chugach, J. C. Penney,
Sears, Ward and Westinghouse.
v. "ROD" shall mean the Record of Decision for the Site
issued by EPA on July 16, 1996.
w. "RI/FS Costs" shall mean all costs incurred or to be incurred by
Chugach and the Settling Federal Entities pursuant to the AOC and the
First Funding Agreement, respectively, plus Interest thereon accrued
from each Expenditure Date, provided, however, that RI/FS costs do not
include Oversight Costs (as defined above). Nor do they include
Chugach's or the Settling Federal Entities' attorneys' fees, stipulated
and/or statutory penalties, if any, or internal administrative costs,
including accounting costs and interest expenses. In addition, because
Scrap Removal Costs were necessarily incurred to gain access to the
Site to perform the RI/FS, the definition of RI/FS Costs shall include
Scrap Removal Costs. x. "Scrap Removal Costs" shall mean the portion of
RI/FS Costs attributable to the costs of eliminating scrap metal and
debris from the Site (including, without limitation, characterizing,
cleaning, sorting, loading, overseeing removal, transporting and
disposing of scrap metal and debris) less the revenues received from
the sale of scrap metal removed from the Site, in the total sum of
$861,221.74. y. "Second Funding Agreement" shall mean the agreement
among CEcon Corporation, Woodward-Clyde Consultants, and the Settling
PRPS other than Sears, pursuant to which the Settling
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PRPs other than Sears paid Scrap Removal Costs. A copy of the Second
Funding Agreement constitutes Appendix 3 of this
Decree.
z. "Section" shall mean a portion of this Decree identified
by a Roman numeral.
aa. "Settling Federal Entities" shall mean the Department of
Transportation (including the Federal Railroad
Administration), the Department of Defense (including the
Defense Logistics Agency, the Defense Reutilization and
Marketing Service, and the Army & Air Force Exchange Service),
and any successor agencies, departments or instrumentalities
of the United States.
bb. "Settling Potentially Responsible Parties" or "Settling
PRPs" shall mean the Defendants and the Settling Federal
Entities.
CC. "United States" shall mean the United States of America
and its agencies, departments and instrumentalities, including
the Settling Federal Entities.
V. PAST RESPONSE, DOJ ENFORCEMENT, RI/FS, AND OVERSIGHT COSTS
PAYMENT AND REIMBURSEMENT OF COSTS
4. General. Each of the Settling PRPS, by entering into
this Decree, agrees to resolve its liability for Past Response
Costs, DoJ Enforcement Costs, RI/FS Costs and Oversight Costs
through payment to the EPA Hazardous Substance Superfund and/or
reimbursement of the United States and of Chugach of its Aliquot
Share of the sum of those Costs. The Aliquot Shares for the
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Settling PRPs are as follows:
o ARRC 02.500%
o B/F 00.416%
o Chugach 14.370%
o J.C. Penney 01.464%
o Sears 12.960%
o Settling Federal Entities 61.500%
o Ward 01.360%
o Westinghouse 05.430%
These Aliquot Shares are not binding or admissible in any future proceeding
between the United States and any of the Defendants, among the Defendants, or
between or among the Defendants and any third party, except that: (a) these
Aliquot Shares may be used to enforce the terms of this Decree; and (b) the
Aliquot Shares of the ARRC and Settling Federal Entities shall be binding with
respect to Future Costs.
5.a. Payment of Past Response Costs and DoJ Enforcement Costs.
i. Within 60 days of the Effective Date, the Defendants
shall pay to the EPA Hazardous Substance Superfund their respective Aliquot
Shares of Past Response Costs and DoJ Enforcement Costs. The Defendants shall be
jointly and severally liable to the United States for payment of their combined
Aliquot Share of Past Response Costs and DoJ Enforcement Costs, but have agreed
among themselves to the allocation of those costs according to the percentages
appearing in Paragraph 4. These payments shall be made in the manner set forth
in subparagraph 5.f.i. below.
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ii. Within 180 days of the Effective Date, the United States,
on behalf of the Settling Federal Entities, shall cause to be paid to the EPA
Hazardous Substance Superfund their Aliquot Share of Past Response Costs and DoJ
Enforcement Costs.
b. Payment of RI/FS and Oversight Costs.
i. EPA and Chugach hereby amend those provisions of
paragraphs 21.1, 21.2 and 21.3 of the AOC pertaining to the process for payment
of Oversight Costs to provide that EPA shall submit a demand for payment of
38.5% of Oversight Costs to Chugach and shall submit a demand for payment of
61.5% of Oversight Costs to the Settling Federal Entities. This amendment does
not alter the provisions of paragraphs 21.4 and 21.5 of the AOC, which relate to
the timing and process for disputing Oversight Costs. The United States and
Chugach hereby amend paragraphs 1, 2 and 3.d. of the First Funding Agreement to
provide that the Settling Federal Entities shall pay 61.5% of Oversight Costs,
as provided in Paragraph 5.e. below.
ii. After all RI/FS Costs have been incurred and are known,
Chugach will provide the Non-Funding Settlers with a summary of all those costs
incurred by it and the Settling Federal Entities pursuant to the AOC and the
First Funding Agreement, as amended by this Decree, and the Second Funding
Agreement (the "RI/FS Costs Summary"). Pursuant to the AOC, as amended by this
Decree, after all Oversight Costs have been incurred and are known, EPA will
submit its summary and demand for oversight Costs and the supporting
documentation described in paragraph 21.4 of the AOC to
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Chugach and the Settling Federal Entities. Within 30 days of receipt of EPA's
summary and demand for payment of Oversight Costs under the AOC, as amended by
this Decree, Chugach will provide the Non-Funding Settlers with a summary of all
Oversight Costs owed by each of the Non-Funding settlers in accordance with
their Aliquot Shares (the "Oversight Costs Summary").
iii. The RI/FS and Oversight Costs Summaries shall be
accompanied by copies of invoices for RI/FS work and EPA's summary of Oversight
Costs, respectively, and demands for payment by each Non-Funding Settler of its
Aliquot Share of these costs. The RI/FS Costs Summary and demand for payment
shall specify the dollar amounts due from each Non-Funding Settler to each of
Chugach and the Settling Federal Entities as reimbursement for RI/FS Costs after
reduction for payments made by that Non-Funding Settler (other than Sears) under
the Second Funding Agreement, plus Interest thereon accruing from each
Expenditure Date. The oversight Costs Summary and demand for payment shall
specify the dollar amounts due from each Non-Funding Settler to Chugach towards
payment by Chugach of 38.5% of Oversight Costs. Sears' reimbursements of RI/FS
Costs and Oversight Costs shall include its full Aliquot Share (12.96%) of those
costs, plus Interest thereon accruing from each Expenditure Date.
iv. The United States and the Non-Funding Settlers may
not dispute or challenge any RI/FS Costs set forth in the RI/FS Costs Summary or
any Oversight Costs set forth in the Oversight Costs Summary or any payment
demands for those costs, except on the
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basis of accounting errors or, with respect to the RI/FS Costs Summary, on the
basis that one or more costs are excluded under the definition of RI/FS Costs
contained in this Decree, or, with respect to the Oversight Costs Summary, on
the basis that one or more costs were not demanded by EPA. Any such disputes
shall first be presented to Chugach, and the Parties shall use best efforts to
resolve such disputes informally before seeking Court resolution. Nothing in
this Decree creates any right in the Settling PRPs to challenge the United
States' incurrence of oversight Costs.
c. Reimbursement of RI/FS and Oversight Costs by Non-
Funding Settlers.
i. Within 30 days of receipt of the RI/FS Costs Summary and
demand for payment pursuant to Paragraph 5.b., each of the Non Funding Settlers
shall make payment to Chugach and the United States, respectively, of the
amounts due Chugach and the Settling Federal Entities as reimbursement for RI/FS
Costs. Within 30 days of receipt of the oversight Costs Summary and demand for
payment pursuant to Paragraph 5.b., each Non-Funding Settler shall make payment
to Chugach of its Aliquot Share of oversight Costs. Payments to Chugach and the
United States hereunder shall be made in the manner set forth in subparagraphs
5.f.ii. and iii. below, respectively.
ii. If any Non-Funding Settler fails to reimburse
Chugach and/or the United States pursuant to subparagraph 5.c.i.
above, such unreimbursed amount(s) shall be credited against
Chugach's and/or the Settling Federal Entities' payments of
Oversight Costs, as provided in Paragraphs 5.d. and 5.e. below. It
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is expressly understood and agreed that the United States shall have the right
to recover from defaulting Non-Funding Settlers all unreimbursed RI/FS Costs
and/or Oversight Costs that have been credited under Paragraphs 5.d. and 5.e.,
and the Parties hereby contractually agree that the Non-Funding Settlers shall
be jointly and severally liable to the United States for payment of their
combined aliquot share of unreimbursed RI/FS Costs and Oversight Costs,
excluding any stipulated penalties provided for in Paragraph 7.
d. Payment of Oversight Costs by Chugach. Chugach shall pay to the
United States, in the manner set forth in subparagraph 5.f.i. below, 38.50% of
Oversight Costs within 90 days of receipt of EPA's summary and demand for
payment of Oversight Costs, provided, however, that if, after reimbursement
under the First Funding Agreement, as amended by this Decree, and Paragraph
5.c., the amount paid by Chugach for RI/FS Costs and the amount owed by Chugach
for oversight Costs exceeds Chugach's Aliquot Share (14.37%) of the aggregate of
RI/FS Costs and Oversight Costs, then Chugach shall receive a Credit, as defined
in Paragraph 3.d., which shall be applied to reduce the dollar amount of
Chugach's payment for oversight Costs. In the event that Chugach's Credit
exceeds Chugach's Aliquot Share (14.37%) of oversight Costs, EPA will take the
excess into consideration in any settlement of Chugach's obligations for Future
Costs.
e. Payment of Oversight Costs by Settling Federal Entities.
Within 180 days after receipt of EPA's summary and demand for
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payment of oversight Costs, the United States, on behalf of the Settling Federal
Entities, shall cause to be paid to the EPA Hazardous Substance Superfund,
61.50% of Oversight Costs, provided, however, that if the amount paid by the
Settling Federal Entities for RI/FS Costs exceeds the Settling Federal Entities'
Aliquot Share (61.50%) of RI/FS Costs after reimbursement by the NonFunding
Settlers pursuant to Paragraph 5.c., then the Settling Federal Entities shall
receive a Credit, as defined in Paragraph 3.d., which shall be applied to reduce
the dollar amount of the Settling Federal Entities' payment for Oversight Costs.
f. Manner of Payment.
i. All payments by Defendants to the United States of Past
Response Costs, DoJ Enforcement Costs, and Oversight Costs, and all payments of
RI/FS Costs recovered by the United States pursuant to subparagraph 5.c.ii.
above shall be made to the EPA Hazardous Substance Superfund by FedWire
Electronic Funds Transfer ("EFT") to the U.S. Department of Justice account in
accordance with current EFT procedures, referencing EPA Region 10 CERCLA Site/
Spill I.D. Number 1078, United States Attorney's Office ("U.S.A.O.") file #
93ZO186/001, and DoJ Case # 90-11-3-810. Payment shall be made in accordance
with instructions provided to the Settling PRPs by the Financial Litigation Unit
of the U.S.A.O. in the District of Alaska following lodging of this Decree. Any
payments received by DoJ after 4:00 p.m. Eastern Time shall be credited on the
next business day. Defendants shall send notice to EPA and DoJ that payment has
been made in accordance with Section
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VIII (Notices and Submissions) and to Joe Penwell, U.S.
Environmental Protection Agency - Region 10, 1200 Sixth Avenue MD-149, Seattle,
Washington 98101.
ii. All reimbursements to Chugach made pursuant to
Paragraph 5.c.i. shall be by EFT to: First National Bank of Anchorage;
Anchorage, Alaska; ABA No. 1252-0006-0; Attention: Linda Butterfield; Credit:
Chugach Electric Association, Inc., Account No. 0110-475-1.
iii. All reimbursements to the United States made pursuant to
Paragraph 5.c.i. shall be by certified check made payable to Treasurer, United
States of America, and shall be mailed or delivered to the Chief, Environmental
Defense Section, United States Department of Justice, Environment and Natural
Resources Division, P.O. Box 23986, Washington, D.C. 20026-3986, and shall
reference DoJ # 90-11-3-844. Alternatively, these reimbursements may be made by
FedWire Electronic Funds Transfer in accordance with the instructions that
appear as Appendix 4 to this Decree.
FAILURE TO COMPLY WITH REQUIREMENTS OF CONSENT DECREE
6. Interest on Late Payments. In the event that any payment
or reimbursement by the Defendants to the United States or to Chugach required
under Paragraphs 5.a.i., 5.c. or 5.d. is not received when due, Interest shall
then begin to accrue or shall continue to accrue, as applicable, on the unpaid
balance through the date of payment. In the event that any payment by the United
States on behalf of the Settling Federal Entities with respect to Past Response
Costs pursuant to Paragraph 5.a.ii. is not made
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<PAGE>
within 180 days of the Effective Date of this Decree, Interest shall continue to
accrue on the unpaid balance through the date of payment. In the event that any
payment by the United States on behalf of the Settling Federal Entities with
respect to DOJ Enforcement Costs pursuant to Paragraph 5.a.ii is not made within
120 days of the Effective Date or with respect to Oversight Costs pursuant to
Paragraph 5.e. is not made within 120 days of receipt of EPA's summary and
demand for payment of Oversight Costs, Interest shall then begin to accrue on
the unpaid balance through the date of payment.
7. Stipulated Penalties.
a. If any Defendant fails to make a payment due to the
United States pursuant to Paragraph 5.a. by the required date or fails to
make reimbursements pursuant to Paragraph 5.c. by the required date, the
Defendant in question shall pay, in addition to Interest, $750 per day to
the United States as a stipulated penalty for each day that such payment is
late.
b. All penalties shall begin to accrue on the day after
complete performance is due or the day a violation occurs, and shall continue to
accrue through the final day of correction of noncompliance or completion of the
activity. Nothing herein shall prevent the simultaneous accrual of separate
penalties for separate violations of this Decree.
c. Stipulated penalties are due and payable within 30 days of
receipt from EPA of a demand for payment of the penalties and shall be made in
the manner set forth in Paragraph 5.f.i.
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 20
<PAGE>
above. All payments shall indicate that the payment is for stipulated penalties
and shall reference the name and address of the Party making the payment, EPA
Region 10 CERCLA Site/Spill I.D. Number 1078, U.S.A.O. file number 93ZO186/001,
and DoJ Case # 90-11-3-810. Any transmittal letter(s) accompanying the payment
of stipulated penalties shall be sent to EPA and DoJ as provided in Section VIII
(Notices and Submissions) and to Christopher Cora, Remedial Project Manager,
U.S. Environmental Protection Agency, Region 10, 1200 Sixth Avenue HW-124,
Seattle, Washington 98101.
d. Notwithstanding any other provision of this Section, the
United States may, in its unreviewable discretion, waive payment of any portion
of the stipulated penalties that have accrued pursuant to this Decree.
8. Enforcement Costs. If the United States takes action to recover
unreimbursed amounts and enforce any Non-Funding Settler's obligation to make
reimbursements under Paragraph 5.c., the NonFunding Settler in question shall
pay the United States all costs, including all attorneys' fees, incurred in
taking such action.
9. Payments made under Paragraphs 6-8 shall be in addition to any other
remedies or sanctions available to Plaintiff by virtue of Defendants' failure to
comply with the requirements of this Decree.
COVENANTS BY PLAINTIFF; RESERVATIONS OF RIGHTS
10. Covenants by the United States. In consideration of the
Settling PRPS' payments under the terms of this Decree, and except
as provided in Paragraph 11 below, the United States covenants not
to sue or take administrative action (including issuance of any
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 21
<PAGE>
administrative order) against any of the Defendants, and EPA covenants not to
commence administrative action (including issuance of any administrative order)
against the Settling Federal Entities, for claims relating to payment of or
liability for Past Response Costs, DoJ Enforcement Costs, RI/FS Costs and
Oversight Costs. As to each Settling PRP, these covenants are conditioned on
performance by each Settling PRP of its obligations undertaken by each under
paragraph 5 of this Decree. These covenants not to sue or to take administrative
action extend only to the Settling PRPs and do not extend to any other persons
or entities.
11. Reservation of Rights by the United States. The covenants set forth
in Paragraph 10 above and Paragraph 20.b. below do not pertain to any matters
other than those expressly specified therein. The United States reserves, and
this Decree is without prejudice to, all rights the United States may have
against the Defendants and all rights EPA may have against the Settling Federal
Entities with respect to any matters not covered in Paragraph 10 and Paragraph
20.b., including, but not limited to:
a. liability for failure to meet the requirements of
this Decree;
b. criminal liability;
c. liability of the Private PRPs for injunctive relief
or administrative order enforcement under
Section 106 of CERCLA, 42 U.S.C. ss. 9606, with
respect to matters not covered by this Decree;
d. liability of ARRC for injunctive relief or
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 22
<PAGE>
administrative order enforcement under Section 106 of
CERCLA, 42 U.S.C. ss. 9606, with respect to: (1)
activities that were the subject of a unilateral
administrative order dated September 9, 1993; and (2)
requirements of the ROD that only ARRC, as the party
in possession and control of the Site, can
accomplish, including, but not limited to, the
recording and adherence to restrictions on the use of
the Site and the inclusion of such restrictions in
any deed, lease agreement or like instrument
transferring a property interest in the Site;
e. liability for failure to implement the AOC, as
amended by this Decree, in accordance with its
terms; and
f. liability of the Private PRPs for Future Costs,
including but not limited to damages for injury to,
destruction of or loss of natural resources, or for
the costs of any natural resource damage
assessments.
COVENANTS BY THE SETTLING PRPS
12.a. The Defendants hereby covenant not to sue and agree not to assert
any claims or causes of action against the United States or its contractors or
employees, with respect to Past Response Costs, DoJ Enforcement Costs, RI/FS
Costs or Oversight Costs, including, but not limited to:
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 23
<PAGE>
i. any direct or indirect claim for reimbursement from the
Hazardous Substance Superfund based on Section(s)
106(b)(2), 107, 111, 112 and/or 113 of CERCLA, 42 U.S.C.
ss.ss. 9606(b)(2), 9607, 9611, 9612, and/or 9613, or any
other provision of law;
ii. any claim arising out of response actions at the Site;
and
iii. any claims against the United States, including any
department, agency or instrumentality of the United
States, under Sections 107 or 113 of CERCLA, 42 U.S.C.
ss.ss. 9607 or 9613.
These covenants not to sue extend only to the United States and not to any other
persons or entities.
b. Notwithstanding the provisions of Paragraph 12.a., but only to the
extent of ARRC's liability as provided in Paragraph 4, ARRC reserves any right
it may have to pursue the claim it has asserted against the United States in the
First Claim for Relief appearing in the "Answer and Counterclaims of Alaska
Railroad Corporation" filed in this action on October 20, 1995, together with
any supporting allegations contained in paragraphs 1-14 thereof. The United
States reserves its rights to defend against said claim, including but not
limited to its right to pursue defenses based upon lack of jurisdiction.
c. In consideration of the mutual obligations undertaken and
The payments by the defendants under the terms of this decree, each
defendant covenants not to sue any other defendant for contribution
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 24
<PAGE>
pursuant to Sections 107 or 113 of CERCLA, 42 U.S.C. ss.ss. 9607 or 9613, any
provision of the Resource Conservation and Recovery Act, state statutory or
common law, or any other provision of law with regard to Past Response Costs,
DoJ Enforcement Costs, RI/FS Costs or Oversight Costs, provided, however, that
as to each Defendant, these covenants are conditioned on performance by each
Defendant of the obligations undertaken by each under Paragraph 5 of this
Decree. These covenants not to sue extend only to the Defendants and not to any
other persons or entities.
d. The Settling PRPs agree that each of them shall bear their own
costs, including attorneys fees, for all matters covered by this Decree and all
negotiations leading to entry of this Decree, provided, however, that the
prevailing party in any action between or among the Defendants to enforce the
terms of this Decree shall be entitled to its costs, including attorneys' fees,
incurred in pursuing the action.
13. Nothing in this Decree shall be deemed to constitute
approval or preauthorization of a claim within the meaning of
Section 111 of CERCLA, 42 U.S.C. ss. 9611, or 40 C.F.R. ss. 300.700(d).
EFFECT OF SETTLEMENT; CONTRIBUTION PROTECTION: ACTIONS
14. Nothing in this Decree shall be construed to create any rights in,
or grant any cause of action to, any person not a party to this Decree. The
Parties expressly reserve all rights (including, but not limited to, any right
to contribution), defenses, claims, privileges, demands and causes of action
which each of them may have with respect to any matter, transaction, or
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 25
<PAGE>
occurrence relating in any way to the Site against any person not a party
hereto. Further, nothing in this Decree shall be construed as an indication that
the Settling PRPs accept or agree that any particular allocation, whether set
forth herein or otherwise, is appropriate as to any person or entity not a party
to this Decree, whether under Section 113(f) of CERCLA, 42 U.S.C. ss. 9613(f),
or otherwise, as to any matter, obligation, or liability.
15. By entering into this Decree, the Settling PRPs have resolved their
liability for Past Response Costs, DoJ Enforcement Costs, RI/FS Costs and
Oversight Costs. The Parties agree, and by entering this Decree this Court
finds, that the Settling PRPs are entitled, as of the Effective Date of this
Decree, to protection from contribution actions or claims as provided in Section
113(f)(2) of CERCLA, 42 U.S.C. 9613 (f)(2), for Past Response Costs, DoJ
Enforcement Costs, RI/FS Costs and Oversight Costs.
16.a. The Parties agree that with respect to any suit or claim for
contribution brought by them or any of them against a person not a party to this
Decree for matters related to this Decree, they will notify each other in
writing no later than 10 days prior to the initiation of such suit or claim. The
proceeds of any judgment in such action shall be shared among the Settling PRPs,
according to their Aliquot Shares appearing in Paragraph 4, after deduction of
costs incurred in the action, including attorneys' fees. Disbursement of such
proceeds shall be made not later than thirty (30) days after their receipt.
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 26
<PAGE>
b. The Defendants also agree that, with respect to any suit or claim
for contribution brought against them or any of them by a person not a party to
this Decree for matters related to this Decree, they will notify each other and
the United States in writing within ten (10) days of service of the complaint.
In addition, each Defendant shall notify EPA and DoJ within ten (10) days of
service or receipt of any Motion for Summary Judgment, and within ten (10) days
of receipt of any order from a court setting a case for trial, for matters
related to this Decree.
17. This Decree shall not be construed to provide for judicial review
of EPA decisions made in connection with the AOC, as amended by this Decree,
and/or the RI/FS, nor shall it be deemed to provide for preenforcement review
under Section 113(h) of CERCLA, 42 U.S.C. ss. 9613(h), of any decision made,
order issued, or other remedial or removal response action taken by EPA unless
an action or proceeding to enforce such decision or order, or to compel such
action, is initiated by the United States on behalf of EPA.
18. In any such subsequent proceeding initiated by the United States,
the Defendants agree that, except for matters expressly resolved in this Decree,
they shall not assert and may not maintain any defense or claim based on the
principles of waiver, res judicata, collateral estoppel, issue preclusion, claim
splitting, or other defenses based upon the contention that claims raised by the
United States in the subsequent proceeding were or should have been brought in
the instant action, provided, however, that nothing
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 27
<PAGE>
in this Paragraph affects the enforceability of the covenants by
the United States set forth in Paragraph 10 above or Paragraph
20.b. below.
VI. AGREEMENTS REGARDINGS FUTURE COSTS
19. Allocation and Payment of Future Costs
a. The Settling Federal Entities, or the United States on
their behalf, shall pay sixty-one and one-half percent (61.5%) of
Future Costs.
b. Subject only to the reservation set forth in Paragraph 20.d., ARRC
shall pay two and one-half percent (2.5%) of Future Costs. Nothing in Paragraph
20.d. shall be construed to reserve a claim by ARRC against the United States
which exceeds ARRC's share of future costs as provided in the this Decree.
c. Notwithstanding Paragraph 19.a., nothing in this Decree shall be
construed in any way as imposing an obligation on the Settling Federal Entities
to perform any work at the Standard Steel Superfund Site.
d. Unless otherwise agreed to in writing, in an agreement or agreements
among the United States, ARRC, and one or more of the Private PRPS, the United
States, on behalf of the Settling Federal Entities, and ARRC shall pay their
Aliquot Shares of Future Costs in the manner set forth below:
i. Upon receipt of statements from contractors or others
actually performing work or incurring Future Costs,
Parties having engaged such contractors or otherwise
performed work or incurred Future Costs ("Performing
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 28
<PAGE>
Parties") shall promptly provide ARRC and the United States
with a statement demanding payment, accompanied by invoices
that precisely detail the work performed for which payment is
demanded (itemized by task), the expenses incurred, the hours
required for performance of such work and the charges
therefore as billed to the Performing Parties and allocated to
ARRC and the United States in accordance with the terms of
this Decree. For purposes of this Subparagraph 19.d., the
demand and accompanying documentation shall be referred to
collectively as a "Payment Demand."
ii. ARRC shall pay its Aliquot Share of Future Costs in
accordance with the same terms and conditions governing
the payment of Future Costs by Performing Parties, or
within 30 days after the date of each Payment Demand,
whichever is later. ARRC shall pay interest on all
unpaid Future Costs due, which interest shall be in an
amount and shall begin to accrue in accordance with the
same terms and conditions governing the payment of
interest on Future Costs by the Performing Parties or
such interest shall begin to accrue 30 days after the
date of each Payment Demand, whichever is later.
iii. Parties performing work or otherwise incurring Future Costs
shall submit Payment Demands to the United States on a
quarterly basis, by way of a project coordinator the United
States shall hereinafter designate upon request.
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 29
<PAGE>
iv. Each Payment Demand made under subparagraph 19.d.iii
shall be accompanied by a certification executed by the
Performing Parties as follows: "Each Performing Party making
this Payment Demand certifies that the costs referenced in the
attached invoice were properly incurred under EPA oversight,
pursuant to [the consent decree or administrative order under
which Future Costs have been incurred] and that the demand for
payment is properly made pursuant to the Partial Consent
Decree entered in United States v. Alaska Railroad Corp., No.
A91-589-CIV, on or about (date of entry of this Decree).
Payment by the United States of all amounts in the attached
invoice as demanded by [the party or parties making the
demand) shall be accepted as payment in full of all sums owing
under the Partial Consent Decree by the Settling Federal
Entities for services performed by, or at or under the
direction of, (the party or parties making the demand),
together with any services billed to such parties by
subcontractors or others performing work, through the closing
date reflected on the attached invoices."
v. The United States, on behalf of the Settling Federal
Entities, shall then pay its Aliquot Share of the Future
Costs as set forth in each Payment Demand, less any
amounts withheld or disputed in accordance with this
subparagraph d.v., as soon as reasonably practicable, but
in no event later than 180 days after the date of the
Payment Demand. If the United States in good faith
questions or contests any invoiced fees or expenses, it
shall have the right to withhold payment of such disputed
amount; provided, however, that the United States shall
notify the party demanding payment in writing of any
disputed amount within 45 days of the date of such
Payment Demand and shall make a good faith effort to
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 30
<PAGE>
resolve such dispute. In the event that the parties cannot
resolve the dispute, either party may seek the Court's
assistance by motion not less than 90 days after the date of
the Payment Demand in question. Each payment shall include
Interest, calculated and added to each payment by the United
States, accruing from the date of Payment Demand to the date
of payment. For purposes of this subparagraph, "date of
payment" shall mean the date that a check or electronic funds
transfer is issued by the United States to satisfy each
Payment Demand.
vi. Payments made by the United States and ARRC pursuant to this
Paragraph shall be made in accordance with instructions
accompanying the Payment Demand either by electronic funds
transfer or by check.
vii. Parties making demands for payment to either ARRC or the
United States shall maintain all books, records,
documents, and other evidence, including descriptions of
accounting procedures and practices, necessary to
document each and every expenditure for which demand is
made for payment of an Aliquot Share throughout the time
during which remedial work is being performed at the
site, and for a period of 3 years thereafter. Such
records shall be maintained in accordance with good
accounting practice and shall be made available to ARRC
or the United States at all reasonable times for
inspection, audit, and reproduction. Any substantial
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 31
<PAGE>
costs associated with auditing or reproduction conducted
pursuant to this subparagraph 19.d.vii shall be borne by the
United States or ARRC as appropriate. In addition, Parties
making demands for payment shall notify ARRC and the United
States not less than 90 days before documentation maintained
pursuant to this subparagraph is to be destroyed for any
reason. Access to, or copies of, the same documentation shall
be made available to ARRC or the United States upon request
made within the specified 90 day period.
viii.Not later than 180 days after any Performing Party making Payment
Demands pursuant to this Paragraph certifies completion of work
pursuant to an applicable consent decree or administrative order, that
Party shall deliver to ARRC and to the United States a full and final
accounting of the expenditures relating to conduct of the work in
question. The United States and ARRC may not dispute or challenge these
expenditures except on the basis of accounting errors. If the United
States or ARRC in good faith question or contest any invoiced fees or
expenses on the basis of accounting errors revealed in the final
accounting, the party questioning payment shall notify the Performing
Parties in writing of any disputed amount within 45 days of delivery of
the accounting and shall make a good faith effort to resolve such
dispute. In the event that the parties cannot resolve the dispute,
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 32
<PAGE>
either party may seek the Court's assistance by motion
not less than 90 days after delivery of the accounting in
question.
20. Covenants Regarding Future Costs; Effect of Future Costs
Allocation
a. The Parties agree, and by entering this Decree this Court finds,
that in any allocation of Future Costs, the collective liability of the ARRC and
the Settling Federal Entities for Future Costs shall be limited to their
aggregate Aliquot Share (64.00%). This aggregate Aliquot Share shall be
construed as a final allocation for the ARRC and the Settling Federal Entities
under Section 113(f) of CERCLA, 42 U.S.C. ss. 9613(f), with respect to Future
Costs. All contractual arrangements among the Settling PRPs, or any of them, for
funding of Future Costs shall allocate 64.00% in the aggregate to the ARRC and
the Settling Federal Entities.
b. In consideration of the mutual obligations undertaken pursuant to
the terms of this Decree and except as provided in Paragraph 11 above, the
United States covenants not to sue or take administrative action (including
issuance of any administrative order) against ARRC, and EPA covenants not to
commence administrative action (including issuance of any administrative order)
against the Settling Federal Entities, for claims relating to payment of or
liability for Future Costs or to performance of work at the Standard Steel
Superfund Site other than that which only ARRC, as the party in possession and
control of the Site, can accomplish, provided, however, that these covenants are
conditioned
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 33
<PAGE>
on performance by ARRC and the Settling Federal Entities of their obligations
under Paragraph 19 of this Decree. These covenants not to sue or to take
administrative action extend only to ARRC and the Settling Federal Entities and
do not extend to any other persons or entities.
c. In consideration of the mutual obligations undertaken pursuant to
the terms of this Decree, the Private PRPs each covenant not to sue or assert
any claims or causes of action against ARRC and the Defendants each covenant not
to sue or assert any claims or causes of action against the United States,
including any department, agency or instrumentality of the United States, for
claims relating to payment of or liability for Future Costs, including, but not
limited to, any claims under Sections 107 or 113 of CERCLA, 42 U.S.C. ss. 9607
or ss. 9613. These covenants not to sue, however, are conditioned on performance
by ARRC and the Settling Federal Entities of the obligations undertaken by each
under Paragraph 19 of this Decree. These covenants not to sue extend only to
ARRC and the United States, including any department, agency or instrumentality
of the United States, and not to any other persons or entities. Nothing in this
subparagraph c shall prevent the Private PRPs from seeking to enforce the terms
of this Consent Decree. Nothing in this Decree shall be construed as a waiver of
any of the Parties' rights, if any, to seek costs, including attorneys' fees,
from a court in any proceeding brought to enforce the terms of this Decree.
d. Notwithstanding the provisions of Paragraph 20.c., ARRC
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 34
<PAGE>
reserves any right it may have to pursue the claim it has asserted against the
United States in the First Claim for Relief appearing in the "Answer and
Counterclaims of Alaska Railroad Corporation" filed in this action on October
20, 1995, together with any supporting allegations contained in paragraphs 1-14
thereof. The United States reserves its rights to defend against said claim,
including but not limited to its right to pursue defenses based upon lack of
jurisdiction.
e. By entering into this Decree, ARRC and the Settling Federal Entities
have resolved their liability for Future Costs. The Parties agree, and by
entering this Decree this Court finds, that ARRC and the Settling Federal
Entities are entitled, as of the Effective Date of this Decree, to protection
from contribution actions or claims as provided by CERCLA Section 113(f) (2), 42
U.S.C. ss. 9613(f)(2), for Future Costs.
f. Nothing in this Decree is intended or shall be construed as an
indication that the Private PRPs have agreed to an allocation among themselves
under Section 113(f) of CERCLA, 42 U.S.C. ss. 9613(f), or otherwise, with
respect to Future Costs. The Private PRPs expressly acknowledge that the
financial commitments in this Decree are without prejudice to any position any
of them may take in the course of further negotiations or litigation among
themselves regarding allocation of, or contribution for, Future costs and are
without admission that any particular allocation is appropriate or equitable for
Future Costs. By entering into this Decree, the Private PRPs do not waive any
right, claim, privilege,
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 35
<PAGE>
cause of action or defense they or any of them may have, under contract or
otherwise, against each other with respect to matters not covered by this
Decree.
VII. SITE ACCESS AND COOPERATION
21. Access. ARRC agrees to provide the United States and its
representatives, including EPA and its contractors, the State of Alaska and its
representatives, and the Private PRPs and their representatives who are
performing response actions under an agreement with or pursuant to an order
issued by EPA, access at all reasonable times to the Site and to any other
property to which access is required for the implementation of the AOC or for
the implementation of the requirements of the ROD, to the extent access to the
Site or other property is controlled by ARRC, for the purpose of conducting any
activity relating to the implementation of the AOC or to the implementation of
the requirements of the ROD, including, but not limited to:
1) monitoring the work being performed;
2) verifying any data or information submitted to the
United States;
3) conducting investigations relating to contamination
at or near the Site;
4) obtaining samples;
5) assessing the need for, planning, or implementing
additional response action at or near the Site;
6) inspecting and copying records, operating logs,
contracts or other documents maintained or
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 36
<PAGE>
generated by ARRC or its agents; and
7) assessing compliance with any administrative order,
consent decree or other agreement relating to
performance of the remedy at the Site.
Nothing in this Paragraph or in Paragraphs 22 and 23 of this Decree shall be
construed to require ARRC to incur any material expense, cost or loss in
furtherance of Section VII without allocation of such material expense, cost or
loss pursuant to this Decree as a Future Cost.
22. Requirements Of The ROD Only ARRC Can Accomplish. ARRC agrees to
becomes a signatory to a subsequent consent decree for the limited purpose of
implementing requirements of the ROD that only ARRC can accomplish, other than
access as addressed in Paragraph 21 above.
23. Cooperation. The Parties shall make good faith efforts
to cooperate with each other in the conduct of any of the future
design, response, removal or remediation activities relating to the
Site.
VIII. RETENTION OF RECORDS
24. Until five (5) years from completion of remedial action at the
Standard Steel Site, each Defendant shall preserve and retain all records and
documents now in its possession or control, or which come into its possession or
control, that relate in any manner to response actions taken at the Site through
the record of decision or the liability of any Defendant for response actions
conducted and to be conducted at the Site, regardless of any
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 37
<PAGE>
corporate retention policy to the contrary. Each Defendant shall preserve and
retain for ten (10) years from completion of remedial action all records and
documents related to implementation of remedial design and remedial action at
the Site that are generated by or on behalf of such Defendant.
25. After the conclusion of the document retention period in the
preceding paragraph, the Defendants shall notify EPA and DoJ at least 90 days
prior to the destruction of any such records or documents, and, upon request by
EPA or DoJ, the Defendants shall deliver any such records or documents to EPA.
The Defendants may assert that certain documents, records, or other information
are privileged under the attorney-client privilege or any other privilege
recognized by federal law. If Settling Defendants assert such a privilege, they
shall provide the United States with the following: 1) the title of the
document, record, or information; 2) the date of the document, record, or
information; 3) the name and title of the author of the document, record, or
information; 4) the name and title of each addressee and recipient; 5) a
description of the subject of the document, record, or information; and 6) the
privilege asserted. However, no documents, reports, or other information created
or generated pursuant to the requirements of this or any other consent decree
with the United States shall be withheld on the grounds that they are
privileged. If a claim of privilege applies only to a portion of a document, the
document shall be provided to the United States in redacted form to mask the
privileged information only. The Defendants shall retain all
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 38
<PAGE>
records and documents that they claim to be privileged until the United States
has had a reasonable opportunity to dispute the privilege claim and any such
dispute has been resolved in the Defendants' favor.
26. By signing this Decree, each Defendant certifies
individually that, to the best of its knowledge and belief, it has:
a. not altered, mutilated, discarded, destroyed or otherwise disposed of
any records, documents or other information relating to its potential
liability regarding the Site, after notification of potential liability or
the filing of a suit against the Defendant regarding the Site; and
b. fully complied with any and all EPA requests for information regarding
the Site pursuant to Sections 104(e) and 122(e) of CERCLA, 42 U.S.C. ss.ss.
9604(e) and 9622(e).
27. Each Settling Federal Entity hereby certifies that (1) it has
complied, and will continue to comply, with all applicable Federal record
retention laws, regulations, and policies; (2) to the best of its knowledge and
belief, after reasonable inquiry, it has not altered, mutilated, discarded,
destroyed or otherwise disposed of any records, documents or other information
relating to its potential liability regarding the Site since notification of
potential liability by EPA or the filing of suit against it regarding the Site;
and (3) it has fully complied with any and all EPA requests for information
pursuant to Sections 104(e) and 122(e) of CERCLA, 42 U.S.C. ss.ss. 9604(e) and
9622(e), and Section 3007 of RCRA, 42 U.S.C. ss. 6927.
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 39
<PAGE>
IX. NOTICES AND SUBMISSIONS
28. Whenever this Decree requires written notice to be given or a
document to be sent by one party to another, it shall be directed to the
individuals at the addresses specified below, unless those individuals or their
successors give notice of a change to the other parties in writing. Written
notice as specified herein shall constitute complete satisfaction of any written
notice requirement of this Decree with respect to the United States, EPA, DoJ
and the Defendants, respectively.
As to EPA:
Lori L. Houck
Office of Regional Counsel
U.S. EPA Region 10 SO-155
1200 Sixth Avenue
Seattle, Washington 98101
As to the United States:
Chief, Environmental Enforcement Section
Environment and Natural Resources Division
U.S. Department of Justice
P.O. Box 7611
Ben Franklin Station
Washington, D.C. 20044
Re: DoJ # 90-11-3-810
Chief, Environmental Defense Section
Environment and Natural Resource Division
United States Department of Justice
P.O. Box 23986
Washington, D.C. 20026-3986
Re: DoJ # 90-11-3-844
As to the Alaska Railroad Corporation:
Phyllis Johnson
General Counsel
Alaska Railroad Corporation
P.O. Box 107500
Anchorage, Alaska 99510-7500
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 40
<PAGE>
As to Bridgestone/Firestone:
James K. Vines With a copy to:
General Counsel/Environmental Heidi Hughes Bumpers
Bridgestone/Firestone Inc. Jones, Day, Reavis & Pogue
50 Century Boulevard 1450 G Street, N.W. Suite 700
Nashville, TN 37214-8900 Washington, D.C. 20005-2832
As to Chugach:
Carol A. Johnson With a copy to:
General Counsel R. Paul Beveridge, Esq.
Chugach Electric Ass'n, Inc. Heller, Ehrman, White &
5601 Minnesota Drive McAuliffe
P.O. Box 196300 6100 Columbia Center
Anchorage, Alaska 99519-6300 701 Fifth Avenue
Seattle, Washington 98104-7098
As to J.C. Penney:
Regular Mail Via Courier
J.C. Penney Co., Inc. J.C. Penney Company, Inc.
Risk Management Department Risk Management Department
P.O. Box 10001 6501 Legacy Drive, MS-1304
Dallas, Texas 75301-1304 Plano, Texas 75024-3698
With copies to:
Walter G. Cowan, Jr. George Lyle, Esq.
J.C. Penney Co., Inc. Guess & Rudd
Legal Department 510 L Street, Suite 700
Env't'l and Regulatory Section Anchorage, Alaska 99501-1968
P.O. Box 1001 (regular mail)
Dallas, Texas 75301-1304
6501 Legacy Drive, MS-1106 (via courier)
Plano, Texas 75024-3698
As to Montgomery Ward:
Phillip D. Delk, Esq.
Vice President & Deputy General Counsel
Corporate Offices
Montgomery Ward & Co., Inc.
535 West Chicago Avenue, Suite 3N
Chicago, Illinois 60610
With copies to:
Sean Bezark, Esq. George Lyle, Esq.
Altheimer & Gray Guess & Rudd
10 South Wacker Drive 510 L Street, Suite 700
Suite 4000 Anchorage, Alaska 99501
Chicago, Illinois 60606
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 41
<PAGE>
As to Sears:
Frederick J. Kulevich, Esq. With a copy to:
Sears Merchandise Group Bruce A. Bookman, Esq.
Department 766, A2-109B Perkins Coie Suite 300
3333 Beverly Road 1029 West Third Avenue
Hoffman Estates, IL 60179 Anchorage, Alaska 99501
As to Westinghouse:
Office of General Counsel With a copy to:
Westinghouse Electric Corp. Joseph L. Reece, Esq.
Westinghouse Bldg., Gateway Center Davis Wright Tremaine
Pittsburgh, Pennsylvania 15222 Suite 1450
550 W. 7th Street
Anchorage, Alaska 99501
X. FEDERAL CONTRACTING
29. No Defendant shall charge any costs relating to this Decree to a
current or future contract with the United States except in accordance with 48
C.F.R. Part 31 and any applicable agency acquisition regulations.
XI. ANTI-DEFICIENCY ACT PROVISION
30. Payments by the Settling Federal Entities, or by the United States
on their behalf, under this Decree are subject to the availability of
appropriated funds. No provision of this Decree shall be interpreted as or
constitute A commitment or requirement that the Settling Federal Entities or the
United States obligate or pay funds in contravention of the Anti-Deficiency Act,
31 U.S.C. ss.ss. 1341-1342, 1349-1350, and 1511-1519, or any other applicable
federal law or regulation.
XII. RETENTION OF JURISDICTION
31. This Court shall retain jurisdiction over this matter for
the purpose of interpreting and enforcing the terms of this Decree.
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 42
<PAGE>
XIII. INTEGRATION AND APPENDICES
32. This Decree and its appendices constitute the final, complete and
exclusive agreement and understanding among the Parties with respect to the
settlement embodied in this Decree. The Parties acknowledge that there are no
representations, agreements, or understandings relating to the settlement
embodied in this Decree other than those expressly contained in this Decree.
33. The following appendices are attached to, but are not incorporated
into, this Decree: "Appendix 1" -- the AOC; "Appendix 2" -- the First Funding
Agreement; "Appendix 3" -- the Second Funding Agreement; and "Appendix 411 --
instructions for FedWire Electronic Funds Transfers made pursuant to Paragraphs
5.c.i. and 5.f.iii. above. In the event that any terms and provisions of this
Decree are inconsistent or in conflict with the terms and provisions of the AOC
or the First Funding Agreement, the provisions of this Decree shall govern and
shall supersede the inconsistent provisions set forth in the AOC and the First
Funding Agreement.
XIV. LODGING AND OPPORTUNITY FOR PUBLIC COMMENT
34. This Decree shall be lodged with the Court for a period of not less
than 30 days, for public notice and comment. The United States reserves the
right to withdraw or withhold its consent to entry of the Decree if the comments
received disclose facts or considerations which indicate that the Decree is
inappropriate, improper, or inadequate. If no comments are received or no
changes are proposed in response to such comments,
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 43
<PAGE>
the Defendants consent to entry of the Decree without further
notice.
XV. SIGNATORIES AND SERVICE
35. Each undersigned representative of a Defendant and the
Assistant Attorney General of the Environment and Natural Resources
Division of the DoJ certifies that he or she is fully authorized to
enter into the terms and conditions of this Decree and to execute
and legally bind such party to this Decree.
36. Each Defendant hereby agrees not to oppose entry of this Decree by
this Court or to challenge any provision of this Decree, unless the United
States has notified the Defendants in writing that it no longer supports entry
of the Decree.
37. No modification of this Decree shall be binding unless it is in
writing and approved by this Court. Nothing herein shall be deemed to alter the
Court's authority to supervise, construe, modify, enforce, terminate or
reinstate the terms of this Decree.
38. Each Defendant has identified, on the attached signature pages, the
name and address of an agent who is authorized to accept service of process by
mail on behalf of that Party with respect to all matters arising under or
relating to this Decree. Defendants hereby agree to accept service in that
manner and to waive the formal service requirements set forth in Rule 4 of the
Federal Rules of Civil Procedure and any applicable local rules of this Court,
including, but not limited to, service of summons.
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 44
<PAGE>
IT IS SO ORDERED THIS _____ DAY OF ____________________, 19__.
------------------------------------
JOHN W. SEDWICK
United States District Judge
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 45
<PAGE>
THE UNDERSIGNED PARTIES enter into this Partial Consent Decree in
the matter of United States v. Alaska Railroad Corporation, Civil
No. A91-059 (D. Alaska) relating to the Standard Steel Superfund
Site.
Date: 10/5/96 /s/ Lois J. Schiffer
LOIS J. SCHIFFER
Assistant Attorney General
Environment and Natural
Resources Division
U.S. Department of Justice
Washington, D.C. 20530
/s/ Gina R. Belt for
MICHAEL D. ROWE, Attorney
Environmental Defense Section
Environment and Natural
Resources Division
P.O. Box 23986 L'Enfant Plaza
Washington, D.C. 20026-3986
/s/ Gina R. Belt
REGINA R. BELT, Attorney
Environmental Enforcement Section
Environment and Natural
Resources Division
801 B Street Suite 504
Anchorage, Alaska 99501-3657
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 46
<PAGE>
Date: 9/18/96 /s/ Chuck Clarke
CHUCK CLARKE
Regional Administrator, Region 10
U.S. Environmental Protection Agency
/s/ Lori L. Houck
LORI L. HOUCK
Assistant Regional Counsel, Region 10
U.S. Environmental Protection Agency
1200 Sixth Avenue SO-155
Seattle, Washinton 98101
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 47
<PAGE>
FOR THE DEFENDANTS:
For the Alaska Railroad Corporation:
Dated: September 9, 1996 /s/ Robert S. Hatfield, Jr.
Robert S. Hatfield, Jr.
President and Chief Executive Officer
Agent for Service of Process:
Phyllis Johnson
General Counsel
Alaska Railroad Corporation
P.O. Box 107500
Anchorage, Alaska 99510-7500
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 48
<PAGE>
For Bridgestone/Firestone, Inc.:
Dated: July 30, 1996 /s/ James K. Vines
James K. Vines
[title] General Counsel - Environmental
Agent for Service of Process:
Heidi H. Bumpers, Esq.
Metropolitan Square
1450 G Street, N.W.
Washington, D.C. 20005-2088
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 49
<PAGE>
For Chugach Electric Association, Inc.:
Dated: September 5, 1996 /s/ Eugene N. Bjornstad
Eugene N. Bjornstad
General Manager
Agent for Service of Process:
Eugene N. Bjornstad
General Manager
Chugach Electric Ass'n, Inc.
5601 Minnesota Drive
P.O. Box 196300
Anchorage, Alaska 99519-6300
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 50
<PAGE>
For J.C. Penney Company, Inc.:
Dated: September 12, 1996 /s/ Carl B. Seaholm
Carl B. Seaholm
Manager, Corporate Risk Management
Agent for Service of Process:
Guess & Rudd
510 L Street, Suite 700
Anchorage, Alaska 99501
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 51
<PAGE>
For Mongtomery Ward & Co., Inc.:
Dated: 9/19/96 /s/ Phillip D. Delk
Phillip D. Delk, Esq.
Vice President &
Deputy General Counsel
Agent for Service of Process:
Guess & Rudd
510 L Street, Suite 700
Anchorage, Alaska 99501
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 52
<PAGE>
For Sears, Roebuck and Co.:
Dated: 9/26/96 /s/ Bobbie McGee Gregg
Bobbie McGee Gregg
Vice President - Law
Sears, Roebuck and Co.
Agent for Service of Process:
Frederick J. Kulevich
Attorney
Sears, Roebuck and Co.
3333 Beverly Road
Hoffman Estates, Illinois 60179
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 53
<PAGE>
For Westinghouse Electric Corporation:
Dated: September 30, 1996 /s/ Samuel R. Pitts
Samuel R. Pitts
Vice President
Agent for Service of Process:
C T Corporation System
Suite 300
801 West Tenth Street
Juneau, Alaska 99801
CONSENT DECREE: STANDARD STEEL SUPERFUND SITE - 54
<PAGE>
APPENDIX 1 TO PARTIAL CONSENT DECREE
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
REGION 10
IN THE MATTER OF:
Standard Steel & Metals Salvage
Yard, Anchorage, Alaska
Chugach Electric Association, Inc.
RESPONDENT.
Proceeding Under Sections 104, 106
120(e)(6), 122(a), and 122(d)(3)
of the Comprehensive Environmental
Response, Compensation, and
Liability Act, as amended 42
U.S.C. ss. ss. 9604, 9606,
9620(e)(6), 9622(a), and
9622(d)(3).
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
U.S. EPA Docket
Nos.
1091-07-02-107 and
1091-07-01-120.
)
ADMINISTRATIVE ORDER ON CONSENT
FOR REMEDIAL INVESTIGATION/FEASIBILITY STUDY
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 1 September 23, 1992
<PAGE>
TABLE OF CONTENTS
Page
I. Introduction..................................................... 4
II. Jurisdiction..................................................... 4
III. Parties Bound.................................................... 5
IV. Statement of Purpose ............................................ 6
V. Findings of Fact................................................. 7
VI. Conclusions of Law............................................... 12
VII. Notice to State.................................................. 12
VIII. Work to be Performed............................................. 13
IX. U.S. EPA'S Baseline Risk Assessment.............................. 16
X. Modification of the Work Plan.................................... 17
XI. Quality Assurance................................................ 19
XII. Final RI/FS, Proposed Plan, Public Comment, Record
of Decision, Administrative Record.............................. 19
XIII. Progress Reports and Meetings.................................... 20
XIV. Sampling, Access, and Data Availability
/Admissibility.................................................. 21
XV. Designated Project Coordinators.................................. 25
XVI. Other Applicable Laws............................................ 27
XVII. Record Preservation.............................................. 27
XVIII. Dispute Resolution............................................... 27
XIX. Stipulated Penalties............................................. 30
XX. Force Majeure.....................................................33
XXI. Reimbursement of Response and Oversight Costs.................... 35
XXII. Financial Assurance, Insurance, and Indemnification.............. 38
XXIII. Judicial Review.................................................. 41
XXIV. Reservations of Rights........................................... 41
XXV. Other Claims..................................................... 42
XXVI. Effective Date and Subsequent Modification....................... 43
XXVII. Satisfaction..................................................... 44
XXVIII. Separate Documents............................................... 44
XXIX. Contingent Right to Withdraw..................................... 45
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 2 September 23, 1992
<PAGE>
I. INTRODUCTION
1.1 This Administrative Order on Consent
("Consent Order") is entered into voluntarily by the United States
Environmental Protection Agency ("U.S. EPA") and Chugach Electric
Association, Inc. ("Respondent"). This Consent Order concerns the
preparation and performance of a Remedial Investigation and Feasibility
Study ("RI/FS") and approved Interim Remedial Actions or new Removal
Responses for the Standard Steel & Metals Salvage Yard Superfund Site (the
"Site" or the "Standard Steel Site") located at 2400 Railroad Avenue,
Anchorage, Alaska.
II. JURISDICTION
2.1 This Consent Order is issued under the
authority vested in the President of the United States by any or all of the
following: Sections 104, 106, 120(e)(6), 122(a), and 122(d)(3) of the
Comprehensive Environmental Response, Compensation, and Liability Act, as
amended, 42 U.S.C. ss.ss. 9604, 9606, 9260(e)(6), 9622(a), and 9622(d)(3)
("CERCLA"). This authority was delegated to the Administrator of U.S. EPA
on January 23, 1987, by Executive Order 12580, 52 Fed. Reg. 2926 (1987) and
was further delegated to Regional Administrators on September 13, 1987, by
U.S. EPA Delegation No. 14-14-C. The authority was re-delegated to the
Director of the U.S. EPA Region 10 Hazardous Waste Division, by a Regional
Redelegation order signed by the Regional Administrator on April 8, 1987.
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 3 September 23, 1992
<PAGE>
2.2 The Respondent agrees to undertake all actions required by
this Consent order. In any action by U.S. EPA or the United States to
enforce the terms of this Consent Order, Respondent consents to the
authority and jurisdiction of U.S. EPA to issue or enforce this Consent
Order. Respondent and U.S. EPA agree not to contest the validity or terms
of this Consent Order, or the procedures underlying or relating to it, in
any action brought by the United States to enforce its terms.
III. PARTIES BOUND
3.1 This Consent Order applies to and is binding upon U.S. EPA
and upon the Respondent, its agents, successors, and assigns. Respondent is
jointly and severally responsible for carrying out all actions required of
them by this Consent Order. The signatories hereto certify that they are
authorized to execute and legally bind the parties they represent to this
Consent Order. No change in the ownership or corporate status of the
signatories or of the Site shall alter their responsibilities under this
Consent Order.
3.2 Respondent shall provide a copy of this consent order to
any proposed owner or successor in interest before stock, assets or other
indicia of ownership in the entity are transferred. Respondent shall also
provide a copy of this Consent Order to each contractor hired to perform
any work required under this Consent Order (the "Work"), and to each person
representing it with respect to the site or the Work. Respondent shall
condition all contracts entered into for
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 4 September 23, 1992
<PAGE>
performance of the work in conformity with the terms of this Consent Order.
Respondent, or its contractors, shall provide written notice of the Consent
Order to all subcontractors hired to perform any portion of the Work.
Notwithstanding the terms of any contract, Respondent shall be responsible
for ensuring that their subsidiaries, employees, contractors,
subcontractors, consultants and agents comply with this Consent Order.
IV. STATEMENT OF PURPOSE
4.1 In entering into this Consent Order, the objectives of
U.S. EPA and the Respondent is: (a) to determine the nature and extent of
contamination and any threat to the public health, welfare, or the
environment caused by the release or threatened release of hazardous
substances, pollutants, or contaminants at or from the Site, by conducting
a Remedial Investigation; (b) to determine and evaluate alternatives for
remedial action, if any, to prevent, mitigate, or otherwise respond to or
remedy any release or threatened release of hazardous substances,
pollutants, or contaminants at or from the Site, by conducting a
Feasibility Study; (c) to conduct Interim Remedial Actions or new Removal
Responses if proposed by Respondent and approved by U.S. EPA as a means to
effectuate the RI/FS; and (d) to recover response and oversight costs
incurred by U.S. EPA with respect to the RI/FS and this Consent Order.
4.2 The activities conducted by Respondent under
this Consent order are subject to approval by U.S. EPA and shall be
conducted in accordance with the provisions of CERCLA, the
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 5 September 23, 1992
<PAGE>
National Oil and Hazardous Substance Pollution Contingency Plan (the
"NCP"), 40 C.F.R. Part 300, and all applicable U.S. EPA guidances, policies
and procedures.
4.3 Respondent shall provide all information necessary for the
RI/FS. U.S. EPA shall be responsible for performance of the Baseline Risk
Assessment required for completion of the RI/FS (see Section IX) and for
preparation and release of the Proposed Plan and the Record of Decision
(the "ROD") for the remedial action at the Site (see Section XII). V.
FINDINGS OF FACT
5.1 By signing and taking actions under this Consent Order,
Respondent does not necessarily agree with the following findings of fact
in this Section and conclusions of law in Section VI below. Such findings
and conclusions do not constitute admissions of liability by Respondent,
nor shall they be admissible in evidence against the Respondent in any
judicial or administrative proceeding other than a proceeding by the United
States, including U.S. EPA, to enforce this Consent Order or any judgment
relating to it.
5.2 The Standard Steel Site is located on a six
and two-tenths (6.2) acre parcel of land at 2400 Railroad Avenue, in an
industrialized area just north of downtown Anchorage. Over 121,000 people
obtain drinking water from wells within three miles of the Site. The Site's
northern border is adjacent to an Alaska Railroad right-of-way. Ship Creek,
which borders the Site to the south, is a salmon migratory stream. An
Alaska Department
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 6 September 23, 1992
<PAGE>
of Fish and Game hatchery is located approximately 200 yards upstream of
the Site. Ship Creek is also used for recreational fishing and provides
fish for consumption by a transient population located downstream from the
Site.
5.3 The United States, through the Federal Railroad
Administration ("FRA"), an agency within the U.S. Department of
Transportation, or its predecessor agencies, owned the Site for many years.
Since at least the early 1960s, parcels within the Site were leased,
through a federal entity known as the Alaska Railroad, to various metal
salvage and recycling businesses.
5.4 Pursuant to Section 604 of the Alaska
Railroad Transfer Act, 45 U.S.C. ss. 1203, in January 1985, the Alaska
Railroad corporation, a State-owned corporation, received an exclusive
license to the Site and was authorized by statute to "use, occupy and
receive all benefits" of the property. Pursuant to Section 604(d)(2)(A) of
the statute, 45 U.S.C. ss. 1203(d)(2)(A), the State assumed all lease
obligations of the Alaska Railroad.
5.5 The current lessee of the Site is Ben Lomond, Inc., which
entered into a 35-year lease agreement with the Alaska Railroad in January
1983. At the same time, Ben Lomond, Inc. subleased a large portion of the
Site to Standard Steel & Metals Company ("Standard Steel"), a sole
proprietorship owned by Gerald Poirier. In April 1986, U.S. EPA closed most
of the Site to public access, with the exception of a small portion which
is
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 7 September 23, 1992
<PAGE>
currently used and/or subleased by Ben Lomond, Inc. and another small area
which is used by Poirier for an office and scrap yard.
5.6 The Site has been used for salvaging and recycling of
ferrous and non-ferrous metals and lead-acid batteries since at least 1967.
Activity on the Site has included, without limitation, reclamation of
PCB-contaminated electrical transformers, incineration of transformer oil
and copper cores, use of PCB oil in hydraulic equipment on-site, processing
of various types of surplused equipment and drums which contained hazardous
liquids, such as flammables, corrosives, oxidizers and waste oils, and
salvaging of various types of batteries.
5.7 Studies and sampling activities conducted by the Alaska
Department of Environmental Conservation ("ADEC") from approximately 1983
to 1985, and by U.S. EPA in 1985, indicated the presence of PCBs in
transformer fluids and in soils on and off-site. PCB contamination as high
as 165,000 parts per million ("ppm") was found in soils on-site; soil
samples for PCBs from roads on and off-site ranged from traces to 220 ppm.
Soil samples on-site also indicated high levels of lead and significant
levels of cyanide and trichlorobenzene. Ash samples from the on-site
incinerator contained dioxin with Toxic Equivalent Factor ("TEF") values as
high as 5.71 parts per billion ("ppb"). Off-site migration of PCBS was
documented in stream sediment sampling conducted along Ship Creek, which
indicated 2.5 ppm PCBS downstream of the Site. A groundwater monitoring
study demonstrated PCB contamination and organic
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 8 September 23, 1992
<PAGE>
solvent compounds in the shallow water table aquifer beneath the Site. The
presence of thousands of lead-acid batteries on-site also suggested
widespread lead contamination at the Site.
5.8 In May 1986, U.S. EPA determined that an imminent and
substantial endangerment to the public health and environment existed at
the Site. U.S. EPA thereafter conducted a three-phase removal action at the
Site to remove the most significant known contamination and sources of
contamination and to secure the Site for long-term cleanup. Removal
activities during the first phase, conducted during the summer of 1986,
included: staging of 185 transformers, removal of over 1000 gallons of
PCB-contaminated oil and 82 55-gallon drums of RCRA hazardous materials
(including flammable liquids, corrosives and oxidizers); installation of
four groundwater monitoring wells; isolation of dioxin and furan wastes;
construction of an erosion control wall along Ship Creek; and fencing of
the Site to prevent public access and exposure. Additionally, a study on
resident fish of Ship Creek and an initial PCB soil sampling program were
conducted to establish areas of higher risk within the Site boundary.
5.9 The second phase of the removal action, during the summer
and fall of 1987, included removal and/or recycling of approximately
700,000 pounds of batteries and 10,450 gallons of waste oil. Large portions
of the Site were cleared of scrap, which was repositioned on-site. An
estimated 1600 cubic yards of PCB-contaminated soil were stockpiled on-site
and
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 9 September 23, 1992
<PAGE>
protected with a concrete fiber cap.
5.10 The third and final phase of the removal action,
conducted in 1988, resulted in: sealing the stockpiled soil and severely
contaminated ground surfaces with shotcrete to limit exposure risks;
overpacking of drums, cans and other containers of hazardous materials;
and, reworking and strengthening the security fence. The On-Scene
Coordinator's ("OSC") Final Report, received in December 1988, summarized
the status of the work completed and the soil and water data collected
during the removal action.
5.11 On July 14, 1989, U.S. EPA proposed the Site
for inclusion on the National Priority List ("NPL"). 54 Fed. Reg. 29820
(July 14, 1989). The Site was listed on the NPL on August 30, 1990. 55 Fed.
Reg. 35502 (August 30, 1990).
5.12 Respondent Chugach Electric Association, Inc.
arranged for disposal to the Site of electrical transformers containing
PCB-contaminated oil. U.S. EPA has identified another potentially
responsible party not a party to this Consent Order that arranged for
disposal to the Site of electrical transformers containing PCB-contaminated
oil. U.S. EPA has identified other potentially responsible parties not
parties to this Consent Order which arranged for disposal to the Site of
lead-acid batteries.
5.13 Not all persons identified as potentially
responsible parties for the Site are Respondents in this Consent Order.
Certain federal agencies, including the U.S. Department of Transportation,
(including the Federal Railroad
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 10 September 23, 1992
<PAGE>
Administration) and U.S. Department of Defense (including the Defense
Logistics Agency, and the Defense Reutilization and Marketing Service), are
paying a portion of the costs of the RI/FS pursuant to a separate Funding
Agreement with the Respondent. Other potentially responsible parties
identified for the Site are not participating in this Order.
5.14 Hazardous substances at the site include lead and other
metals, PCBS, dioxins, trichlorobenzene and other organic solvent
compounds. Groundwater monitoring data indicate contamination on- and
off-Site.
5.15 Actual and/or potential contaminant release and migration
pathways include, but are not limited to, release and transport of soil
contaminants into the groundwater, surface water, and air.
VI. CONCLUSIONS OF LAW
6.1 The Site is a "facility" as defined in
Section 101(9) of CERCLA, 42 U.S.C. ss. 9601(9).
6.2 Major contaminants identified at the Site include lead,
PCBs and dioxin, each of which is a "hazardous substance" as defined in
Section 101(14) of CERCLA, 42 U.S.C. ss. 9601(14).
6.3 The presence of hazardous substances at the Site, or the
past, present, or potential migration of hazardous substances currently
located at or emanating from the Site, constitute actual and/or threatened
"releases" as defined in Section 101(22) of CERCLA, 42 U.S.C. ss. 9601(22).
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 11 September 23, 1992
<PAGE>
6.4 Respondent is a "person" as defined in
section 101(21) of CERCLA, 42 U.S.C. ss. 9601(21), and is "potentially
responsible parties" within the meaning of sections 104, 106, 107, 1-20 and
122 of CERCLA, 42 U.S.C. ss.ss. 9604, 9607, 9606, 9620, and 9622.
6.5 The actions required by this Consent Order
are: necessary to protect the public health or welfare or the environment
and in the public interest, 42 U.S.C. ss. 9622(a); consistent with CERCLA
and the NCP, 42 U.S.C. ss. 9604(a)(1) and 9622(a); and will expedite
effective remedial action and minimize litigation, 42 U.S.C. ss. 9622(a).
VII. NOTICE TO THE STATE
7.1 By providing it with a copy of this Consent Order, U.S.
EPA is notifying the State of Alaska that this Consent Order is being
issued and that U.S. EPA is the lead agency for coordinating, overseeing,
and enforcing the response actions required by this Consent Order.
VIII. WORK TO BE PERFORMED
8.1 All Work shall be under the direction and supervision of a
qualified contractor with a minimum of five (5) years of experience with
CERCLA and RCRA investigations who is familiar with applicable EPA
guidances (see Paragraph 8.2 below) and with environmental conditions and
standards in Alaska. Before the Work is begun, Respondent shall notify U.S.
EPA in writing of the identity and qualifications of the proposed
supervising contractor and the subcontractors and laboratories to be used
in
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 12 September 23, 1992
<PAGE>
carrying out the Work. The qualifications of such personnel shall be
subject to U.S. EPA review, for verification and approval that they meet
technical background and experience requirements. However, the Respondent's
initial supervising contractor, Woodward-Clyde Consultants, is hereby
approved. During the course of the RI/FS, Respondent shall notify U.S. EPA,
in writing, of any changes or additions in the contractors used to carry
out the Work and shall provide their names, titles and qualifications. U.S.
EPA shall have the same right to approve such changes and additions as it
has with respect to the original contractor proposed by Respondent.
8.2 Respondent shall conduct all activities for development of
the RI/FS listed in and according to the schedule set forth in the
Statement of Work ("SOW"), which is attached hereto as Appendix 1 to this
Consent Order and incorporated by reference herein. All such work shall be
conducted in accordance with CERCLA, the NCP, and U.S. EPA guidances,
including, but not limited to, the "Guidance for Conducting Remedial
Investigations and Feasibility Studies under CERCLA" (OSWER Directive #
9355.3-01) and "Guidance for Data Useability in Risk Assessment" (OSWER
Directive #9285.7-05), as these guidances may be amended or modified by
U.S. EPA. The specific tasks, schedules and list of deliverables that
Respondent is to perform and provide are described more fully in the
attached SOW.
8.3 Unless otherwise specified, if U.S. EPA
disapproves of or requires revisions to any deliverable, in whole
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or in part, Respondent shall amend and submit to U.S. EPA a revised
deliverable which is responsive to all U.S. EPA's comments, within thirty
(30) days of receiving U.S. EPA's comments, unless the U.S. EPA Project
Coordinator determines additional testing or analysis is needed pursuant to
Paragraph 10.1 herein, in which case Respondent shall amend and submit the
revised deliverable within the period agreed to by the Project
Coordinators. For purposes of this Consent Order, day means calendar day
unless otherwise noted.
8.4 U.S. EPA reserves the right to comment on, modify, and/or
direct changes to be made by Respondent in all deliverables. At U.S. EPA's
request, Respondent must fully correct all deficiencies and/or respond to
all U.S. EPA's comments in subsequent or resubmitted deliverables.
8.5 In the event that Respondent amends or revises a report,
plan, or other submittal upon receipt of U.S. EPA comments and U.S. EPA
subsequently disapproves the revised submittal, because the resubmitted
item does not reflect U.S. EPA's directions for changes, Respondent shall
be deemed to be in violation of this Consent Order and U.S. EPA may seek
stipulated or statutory penalties, and/or may seek any other appropriate
relief. It is agreed and understood that disapproval of any submittal is
subject to the dispute resolution procedures contained in Section XVIII.
8.6 Neither failure of U.S. EPA to expressly
approve or disapprove Respondent's submissions within a specified
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 14 September 23, 1992
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time period(s), nor the absence of comments, shall be construed as approval
of such submissions by U.S. EPA. U.S. EPA will provide written notice to
the Project Coordinator when a deliverable is approved or disapproved.
Specific tasks and deliverables identified in the SOW require U.S. EPA
approval before further work may proceed. Other than the specifically
identified tasks and deliverables pending approval or disapproval,
Respondent shall proceed with all other tasks, deliverables and activities
in accordance with the schedules set fort,i in the Sow or required by this
Consent Order. U.S. EPA reserves the right to stop Respondent from
proceeding further, either temporarily or permanently, on any task,
activity, or deliverable set forth in the SOW or required by this Consent
Order at any point during the RI/FS.
8.7 Any hazardous substance, pollutant or contaminant
transferred off-site as hazardous waste under this order must be taken to a
facility acceptable under the Off-Site Policy (OSWER Directive No. 9834.11,
November 13, 1987) in accordance with Section 121(d)(3) of CERCLA, 42
U.S.C. ss. 9621(d)(3). Prior to any off-site shipment of hazardous waste
from the Site to an out-of-state hazardous waste management facility,
Respondent shall provide written notification of such shipment to the
appropriate state environmental official in the receiving state and to U.S.
EPA's Project Coordinator, provided, however, that the notification
requirement shall not apply when the total volume of such off-site
shipments will not exceed ten
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(10) cubic yards.
(a) The off-site shipment notification shall be in
writing and shall include the following information: (1) the name and
location of the facility to which the hazardous substances are to be
shipped; (2) the type and quantity of the hazardous substances to be
shipped; (3) the expected schedule for the shipment of the hazardous
substances; and (4) the method of transportation.
(b) Respondent shall notify the receiving state and
U.S. EPA of major changes in the shipment plan, such as a decision to
ship the hazardous substances to another facility within the same
state, or to a facility in another state.
(c) Respondent shall provide written verification
to U.S. EPA that such shipment was received.
IX. U.S. EPA'S BASELINE RISK ASSESSMENT
9.1 U.S. EPA will perform the Baseline Risk
Assessment required for the completion of the RI/FS. Respondent shall
support U.S. EPA in this effort by providing the information and
deliverables required in the SOW. The major components of the Baseline Risk
Assessment include contaminant identification, exposure assessment,
toxicity assessment and human health and ecological risk characterization.
U.S. EPA will respond to all comments on the Baseline Risk Assessment
during the formal comment period on the Record of Decision.
9.2 U.S. EPA will provide sufficient information
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concerning baseline risks in a timely fashion so that Respondent can begin
drafting the Feasibility study and meet the schedules in the SOW. This
information may be in two memoranda. One memorandum will include a list of
the chemicals of concern for human health and ecological effects; the other
will list the current and potential exposure scenarios and the exposure
assumptions and exposure point concentrations that U.S. EPA plans to use in
the Baseline Risk Assessment.
X. MODIFICATION OF THE WORK PLAN
10.1 If at any time during the RI/FS process, Respondent
identifies a need for additional data or work beyond that required in the
approved Work Plan, a memorandum documenting the need for such data or work
shall be submitted to the U.S. EPA Project coordinator. U.S. EPA, by its
Project Coordinator, in its sole discretion, will determine whether such
additional data or work are to be incorporated into subsequent reports and
deliverables required in the SOW.
10.2 In the event of conditions at the Site posing an
immediate threat to human health or welfare or the environment, Respondent
shall notify U.S. EPA and the state immediately upon becoming aware of such
conditions. In the event of unanticipated or changed circumstances at the
Site that may pose an immediate threat to human health, or welfare or the
environment, Respondent shall notify the U.S. EPA Project Coordinator by
telephone within twenty-four (24) hours of discovery of such circumstances.
In addition to the authorities
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in the NCP, U.S. EPA may require Respondent to make appropriate responses
to eliminate the immediate threat. After the immediate threat is eliminated
to U.S. EPA's satisfaction, U.S. EPA may determine that the unanticipated
or changed circumstances warrant changes in the Work Plan. In such
circumstance, U.S. EPA may modify or amend the Work Plan, in writing,
pursuant to Paragraph 10.4. Respondent thereafter shall be bound by the
Work Plan as modified or amended.
10.3 U.S. EPA may determine that in addition to tasks defined
in the approved Work Plan (including any approved modification thereto),
other work may be necessary to accomplish the objectives of the RI/FS set
forth in the SOW. If it determines that such additional work is required
for a complete RI/FS, U.S. EPA may request that Respondent perform this
additional work. Within fourteen (14) days of receipt of U.S. EPA's
request, Respondent shall either confirm their willingness to perform the
additional work, in writing, to U.S. EPA, or shall invoke dispute
resolution pursuant to Section XVIII of this Consent Order. If Respondent
agrees to perform the additional work or if the dispute resolution process
results in an adverse decision for the Respondent, Respondent shall
implement the additional work according to the standards, specifications
and schedule set forth or approved by U.S. EPA in a written modification or
supplement to the Work Plan. In the event Respondent does not perform the
additional work or such work is not completed to U.S. EPA's satisfaction,
U.S. EPA may invoke any
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 18 September 23, 1992
<PAGE>
enforcement authority provided for in CERCLA, as described in
Section XVIII.
10.4 The following modifications or changes may be made by
written agreement of the Project Coordinators: (1) technical field
modifications to the Work Plan and the Sampling Analysis Plan; (2)
modifications to the schedules for deliverables in the SOW; and (3) any
other change to the RI or FS Work Plans, not otherwise addressed in
Paragraphs 10.2 and 10.3 above. Modification to the final completion date
of the RI/FS contained in the SOW may be made only by the written agreement
of all parties to this Consent Order.
XI. QUALITY ASSURANCE
11.1 Respondent shall assure that Work performed, samples
taken and analyses conducted conform to the requirements of the SOW, and
the quality assurance requirements in the approved Work Plan. Respondent
will assure that field personnel used by it are properly trained in the use
of field equipment and in chain-of-custody procedures.
XII. FINAL RI/FS, PROPOSED PLAN, PUBLIC COMMENT
RECORD OF DECISION, ADMINISTRATIVE RECORD
12.1 In accordance with CERCLA and the NCP, U.S.
EPA retains the responsibility for the release to the public of the final
RI/FS report and for the preparation and release to the public of the
Proposed Plan and Record of Decision for the Site. U.S. EPA will provide
Respondent with copies of the final RI/FS Report, Proposed Plan, and ROD.
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REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 19 September 23, 1992
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12.2 U.S. EPA will determine the contents of the
administrative record file for the selection of remedial action for the
Site. Respondent shall submit to U.S. EPA the documents developed during
the course of the RI/FS upon which selection of the remedial action may be
based. Respondent must also submit any previous studies for the Site
conducted under state, local, or other federal authorities relating to
selection of response actions for this Site, and all communications between
Respondent and state, local, or other federal authorities concerning
selection of response actions for this Site. Documents identified in this
paragraph shall be submitted to U.S. EPA no later than thirty (30) days
after U.S. EPA's request for the material. Respondent may submit comments,
including information and documents during the formal comment period for
the proposed plan, and U.S. EPA will include all such comments and
information and documents in the administrative record. At U.S. EPA's
request, Respondent shall also establish a community information repository
at or near the Site, to house one (1) copy of the administrative record.
XIII. PROGRESS REPORTS AND MEETINGS
13.1 In addition to the deliverables set forth in this Consent
Order, unless otherwise agreed by the Project Coordinators, Respondent
shall provide monthly progress reports to U.S. EPA, by the tenth of each
month. At a minimum, these progress reports shall: (1) describe the actions
which have been taken to comply with this Consent Order during the
preceding
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 20 September 23, 1992
<PAGE>
month; (2) include results of all sampling and tests and other data
received by Respondent during the preceding month and; (3) describe work
planned for the next two (2) months with schedules relating such work to
the overall project schedule for RI/FS completion; and (4) describe all
problems encountered and any anticipated problems, any actual or
anticipated delays, as well as the solutions developed and/or implemented
to address any actual or anticipated problems or delays.
13.2 Respondent shall participate in such meetings as U.S. EPA
may schedule during the performance of the RI/FS. In addition to
presentation of the technical aspects of the RI/FS, such meetings may
include discussion of anticipated problems or new issues. Meetings will be
scheduled at U.S. EPA's discretion subject to reasonable notice to
Respondent.
XIV. SAMPLING, ACCESS, AND DATA AVAILABILITY/ADMISSIBILITY
14.1 All results of sampling, tests, modeling, or
other data (including raw data) generated by Respondent or on Respondent's
behalf during implementation of this Consent Order, shall be submitted to
U.S. EPA in the monthly progress report described in the preceding section
of this Consent Order. U.S. EPA will make available to the Respondent all
results of sampling, tests, modeling, or other data, (including raw data)
generated by U.S. EPA or on behalf of U.S. EPA during implementation of
this Consent Order.
14.2 Respondent will verbally notify U.S. EPA at
least fifteen (15) days prior to conducting field events
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REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 21 September 23, 1992
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described in the SOW, Work Plan or Sampling and Analysis Plan. At U.S.
EPA's or ADEC's verbal or written request, or that of its authorized
Representative(s), Respondent shall allow split or duplicate samples to be
taken by U.S. EPA or ADEC or their authorized representatives of any
samples collected by Respondent in the course of implementing this Consent
Order. All such split or duplicate samples shall be analyzed by the quality
assurance methods identified in the approved Work Plan.
14.3 U.S. EPA and ADEC and their authorized representatives
shall have the authority at all reasonable times to enter and freely move
about the property at the Site and any off-Site areas where work is being
performed, for the purposes of inspecting conditions, activities, records,
operating logs, and contracts related to the site or Respondent and its
contractor(s) pursuant to this Consent Order; reviewing the progress of
Respondent in carrying out this Consent Order; conducting such tests as
U.S. EPA or ADEC or their authorized representatives deem necessary; and
verifying the data submitted by Respondent. In the course of such
activities, U.S. EPA and ADEC or their authorized representatives may use
cameras, recording devices, other documentary-type equipment. Respondent
shall permit U.S. EPA and its authorized representatives to inspect and
copy all records, files, photographs, documents, sampling and monitoring
data and other writings related to work undertaken in carrying out this
Consent Order. Nothing herein shall be construed to limit or affect U.S.
EPA's right of entry or inspection authority
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 22 September 23, 1992
<PAGE>
under federal law. All parties and agencies with access to the Site under
this paragraph shall comply with all approved Health and Safety Plans.
14.4 Respondent may assert claims of business confidentiality
covering part or all of the information submitted pursuant to the terms of
this Consent Order subject to the provisions of 40 C.F.R. ss. 2.203,
provided such claims are allowed by Section 104(e)(7) of CERCLA, 42 U.S.C.
ss. 9604(e)(7). Such claim shall be asserted in the manner described by 40
C.F.R. ss. 2.203(b) and substantiated at the time the claim is made.
Information determined to be confidential by U.S. EPA will be given the
protection specified in 40 C.F.R. Part 2. If no such claim accompanies the
information when it is submitted to U.S. EPA, it may be made available to
the public by U.S. EPA or the state without further notice to Respondent.
14.5 In entering into this Consent Order, Respondent and U.S.
EPA waive any objections to the QA/QC Procedures applied to any data
gathered, generated, or evaluated by U.S. EPA, the state, or Respondent in
the performance or oversight of the Work that has been verified according
to the Quality Assurance/Quality Control ("QA/QC") procedures required by
the Consent Order or any U.S. EPA-approved Work Plan or Sampling and
Analysis Plan. If Respondent objects to any data relating to the RI/FS,
they shall submit a report to U.S. EPA that identifies and explains their
objections, describes the acceptable uses of the data, if any, and
identifies any
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 23 September 23, 1992
<PAGE>
limitations to use of the data. The report must be submitted to U.S. EPA
within fifteen (15) days of the monthly progress report containing the
data.
14.6 Respondent agrees not to assert privilege or
confidentiality claims with respect to any documents or data related to
Site conditions, sampling or monitoring required to be submitted to U.S.
EPA pursuant to this Consent Order. Respondent, however, reserves the right
to assert privilege and work product protections as to opinions and
conclusions of their employees, consultants, attorneys or other agents. In
the event privilege is asserted, upon request, Respondent shall provide
U.S. EPA with the date, author, recipient or addressee, title or
description of the subject of the opinion or conclusion and the privilege
asserted by Respondent.
14.7 There is currently an agreement in place
among the Alaska Railroad Corporation, Ben Lomond, Inc. and Standard Steel
& Metals providing U.S. EPA, ADEC and the Respondent's consultant access to
the Site. Respondent shall use its best efforts to obtain additional
on-site and necessary off site agreements. Such agreements shall provide
access for U.S. EPA, its contractors and oversight officials, ADEC and its
contractors, and the Respondent and its authorized representatives. Such
agreements shall specify that Respondent is not U.S. EPA's representatives
with respect to liability associated with Site activities. Prior to
initiation of field activities on any property, Respondent shall provide to
U.S. EPA
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REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 24 September 23, 1992
<PAGE>
a copy of the access agreement pertaining to such property. if access
agreements are not obtained within a reasonable time, Respondent shall
notify U.S. EPA of its failure to obtain access and provide U.S. EPA with a
detailed description of its efforts to obtain access. U.S. EPA, in its
discretion, may seek to obtain access for the Respondent; may terminate the
Consent Order in the event that Respondent cannot obtain access agreements;
or may allow Respondent to continue work without access. In the event U.S.
EPA does not obtain access for Respondent and does not terminate the
Consent Order, Respondent shall perform all other activities not requiring
access to the off-site are in question. Respondent shall also reimburse
U.S. EPA for all costs, including, but not limited to, enforcement costs
and attorney fees incurred by the United States to obtain access for the
Respondent.
XV. DESIGNATED PROJECT COORDINATORS
15.1 On or before the effective date of this Consent order,
U.S. EPA and Respondent shall each designate their own Project Coordinator.
Each Project Coordinator shall be responsible for overseeing the
implementation of this Consent Order. To the maximum extent possible,
communications between Respondent and U.S. EPA shall be directed to the
Project Coordinator by mail, with copies to such other persons as U.S. EPA
and Respondent may respectively designate. Communications include, but are
not limited to, all reports, approvals and other documents and
correspondence submitted under this Consent Order.
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 25 September 23, 1992
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15.2 U.S. EPA and Respondent each have the right to change
their respective Project Coordinator. The other party must be notified, in
writing, at least ten (10) days prior to the change.
15.3 All reports, approvals, disapprovals and other documents
and correspondence which must be submitted under this Consent Order shall
be sent by hand, express or certified mail, return receipt requested, to
the following Project Coordinators or to such successor Project
Coordinators as may be designated in writing by the parties:
(a) For U.S. EPA:
Christopher Cora
Federal Facility Branch (HW-124)
U.S. EPA, Region 10
1200 Sixth Avenue
Seattle, Washington 98101
(b) For Respondent:
Alex Tula
Woodward-Clyde, Consultants
3440 Bank of California center
900 Fourth Avenue
Seattle, Washington 98164
15.4 U.S. EPA's Project Coordinator shall have the authority
vested in a Remedial Project Manager ("RPM") and On-Scene Coordinator
("OSC") by the NCP. In addition, U.S. EPA's Project Coordinator shall have
the authority, consistent with the NCP, to halt any work required by this
Consent Order, and to take any necessary response action when he/she
determines that
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 26 September 23, 1992
<PAGE>
emergency conditions at the Site may present an immediate endangerment to
public health, welfare, or the environment. The absence of the U.S. EPA
Project Coordinator from the area under study pursuant to this Consent
Order shall not be cause for the stoppage or delay of work.
15.5 In addition to its Project Coordinator, U.S. EPA shall
arrange for other qualified person(s) to assist in its oversight and review
of the conduct of the RI/FS, pursuant to Section 104(a) of CERCLA, 42
U.S.C. ss. 9604(a). Such persons may observe work and make inquiries in the
absence of the U.S. EPA Project Coordinator, but are not authorized to
modify the Work Plan.
XVI. OTHER APPLICABLE LAWS
16.1 Respondent shall comply with all applicable state,
federal and local laws when performing the RI/FS. No local, state, or
federal permit shall be required for any portion of any activity conducted
entirely on-site, where such action is selected and carried out in
compliance with Section 121 of CERCLA, 42 U.S.C. ss. 9621.
XVII. RECORD PRESERVATION
17.1 All records and documents in Respondent's possession that
relate in any way to the Site shall be preserved during the conduct of this
Consent Order and for five (5) years after commencement of any remedial
action. Respondent shall acquire and retain copies of all documents that
relate to the Site which are in the possession of its employees, agents,
ADMINISTRATIVE ORDER ON CONSENT FOR
REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 27 September 23, 1992
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accountants, contractors or attorneys. After this five (5) year period,
Respondent shall notify U.S. EPA at least ninety (90) days before the
documents are scheduled to be destroyed. If U.S. EPA requests that the
documents be saved, Respondent shall, at no cost to U.S. EPA, give U.S. EPA
the documents or copies of the documents.
XVIII. DISPUTE RESOLUTION
18.1 The dispute resolution procedures of this Section shall
be the exclusive mechanism to resolve disputes arising under or with
respect to this Consent Order and shall apply to all provisions of this
Consent Order. The fact that dispute resolution is not specifically
referenced in the individual Sections of the Consent Order is not intended
to and shall not bar Respondent from invoking the procedures with respect
to any disputed issue.
18.2 a. Any dispute which arises under or with respect to this
consent order shall in the first instance be the subject of informal
negotiations between the Respondent and U.S. EPA. The period for informal
negotiations shall not exceed fifteen (15) days from the time the dispute
arises, unless such period is modified by written agreement of the Project
Coordinators. The dispute shall be considered to have arisen when one party
sends the other parties a written Notice of Dispute. In the event that the
parties cannot resolve a dispute informally, the position advanced by U.S.
EPA shall be binding unless formal dispute resolution is invoked under
Paragraph
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REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 28 September 23, 1992
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18.2(b).
b. Within twenty (20) days after the
conclusion of the informal negotiation period, Respondent may request a
determination by U.S. EPA's Hazardous Waste Division Director by submitting
to U.S. EPA a written Statement of Position on the matter in dispute,
including, but not limited to, any factual data, analysis or opinion
supporting that position and any supporting documentation relied upon by
the Respondent.
c. Within twenty (20) days after receipt of
the Respondent's Statement of Position, the EPA will provide to the
Respondent its Statement of Position, including, but not limited to, any
factual data, analysis, or opinion supporting that position and all
supporting documentation relied upon by the U.S. EPA.
d. An administrative record of the dispute
shall be maintained by U.S. EPA and shall contain all Statements of
Position, including supporting documentation, submitted pursuant to this
Section. Where appropriate, the U.S. EPA may allow submission. of
supplemental Statements of Position by the parties to the dispute.
e. The Director of the Hazardous Waste
Division, will issue a final administrative decision resolving the dispute,
based on the administrative record described in subparagraph d. This
decision shall be binding upon the Respondent subject to the provision for
judicial review provided in Paragraph 18.3.
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REMEDIAL INVESTIGATION/FEASIBILITY STUDY - 29 September 23, 1992
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18.3 If the Respondent does not abide by U.S. EPA's final
administrative decision, U.S. EPA reserves the right in its sole discretion
to seek either stipulated or statutory penalties and/or to pursue any other
enforcement option provided in CERCLA. If U.S. EPA seeks enforcement of
this Consent order in court, Respondent may seek judicial review of U.S.
EPA's final administrative decision based on the administrative record
developed during the dispute resolution process. Such judicial review of
the dispute shall be under the arbitrary and capricious standard.
18.4 While a matter is pending in dispute resolu tion,
Respondent is not relieved of their obligations to perform other activities
and submit deliverables on the schedule(s) in their approved Work Plan. The
invocation of dispute resolution does not stay the accrual of stipulated or
statutory penalties under this Consent Order.
XIX. STIPULATED PENALTIES
19.1 U.S. EPA, in its sole discretion, may impose stipulated
penalties for each day that Respondent fails to complete a deliverable in a
timely manner or fail to produce a deliverable of acceptable quality, or
fail to revise any deliverable as directed by U.S. EPA. Penalties begin to
accrue on the day that performance is due or a violation occurs and shall
extend through the date of completion of the correction. Where a revised
submission is required of Respondent, stipulated penalties shall continue
to accrue until a satisfactory
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deliverable is submitted to U.S. EPA. U.S. EPA will provide written notice
for violations that are not based on timeliness; nevertheless, penalties
shall accrue from the day a violation commences. Payment shall be due
within thirty (30) days of receipt of a demand letter from U.S. EPA. U.S.
EPA may, in its sole discretion, waive imposition of stipulated penalties
if it determines that Respondent has attempted in good faith to comply with
this Order or in the event of timely cure of defects in initial
submissions.
19.2 Respondent shall pay interest on any unpaid
balance of stipulated penalties, which shall begin to accrue at the end of
the 30-day period, at the rate established by the Department of Treasury
pursuant to 30 U.S.C. ss. 3717.
19.3 Respondent shall make all payments on account of
stipulated penalties by cashier's or certified check(s) made payable to the
Hazardous Substances Superfund, which are to be transmitted to:
U.S. Environmental Protection Agency
Attn: Superfund Accounting
P.O. Box 360903M
Pittsburgh, PA 15251
All checks shall identify the name of the Site, the site identification
number and the account number. A copy of the check and/or transmittal
letter shall be forwarded to the U.S. EPA Project Coordinator.
19.4 For the following major deliverables,
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stipulated penalties shall accrue in the amount of $1000 per day, per
violation, for the first seven (7) days of noncompliance; $2000 per day,
per violation, for the 8th through 14th day of noncompliance- $5000 per
day, per violation, for the 15th day through the 30th day; and $10,000 per
day, per violation, for the 30th day through the 90th day.
1) The original draft and any revised RI Work Plan.
2) The original draft and any revised Sampling and
Analysis Plan.
3) The original draft and any revised RI Report.
4) The original draft and any revised FS Work Plan.
5) The original draft and any revised Treatability
Testing Work Plan if needed.
6) The original draft and any revised Treatability
Study Sampling and Analysis Plan if needed.
7) The original draft and revised FS Report.
19.5 For the following interim deliverables,
stipulated penalties shall accrue in the amount of $500 per day, per
violation, for the first week of noncompliance; $1000 per day, per
violation, for the 8th through 14th day of noncompliance; $3000 per day,
per violation, for the 15th day through the 30th day of noncompliance; and
$5000 per day, per violation, for the 30th through the 90th day.
1) Technical memorandum on modeling of Site
characteristics if Respondent proposes that
modeling is appropriate.
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2) Preliminary Site Data Summary.
3) Treatability Study Evaluation Report.
4) Memorandum on Remedial Action objectives.
5) Interim Remedial or Removal Action Work Plan if
proposed.
19.6 For failure to submit the monthly progress reports,
stipulated penalties shall accrue in the amount of $250 per day, per
violation, for the first week of noncompliance; $750 per day, per
violation, for the 8th through 14th day of noncompliance, $1500 per day,
per violation, for the 15th day through the 30th day; and $3000 per day,
per violation, for the 30th day through the 90th day.
19.7 Respondent may dispute U.S. EPA's right to the stated
amount of penalties by invoking the dispute resolution procedures under
Section XVIII of this Consent Order. Penalties shall accrue, but need not
be paid, during the dispute resolution period. If Respondent does not
prevail upon resolution of the dispute, all penalties shall be due to U.S.
EPA within thirty (30) days of resolution of the dispute. If Respondent
prevails in the dispute resolution, no penalties shall be paid.
19.8 In the event that U.S. EPA provides for
corrections to be reflected in the next deliverable and does not require
resubmission of the original deliverable, stipulated penalties for that
interim deliverable shall cease to accrue on the date of such decision by
U.S. EPA.
19.9 The stipulated penalties provisions in this
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Section do not preclude U.S. EPA from pursuing any other remedies or
sanctions, including applicable statutory penalties instead of stipulated
penalties, which are available because of Respondent's failure to comply
with this Consent Order. Payment of stipulated penalties does not alter
Respondent's obligation to complete performance under this Consent Order.
XX. FORCE MAJEURE
20.1 For purposes of this Consent Order, "Force Majeure" is
defined as any event arising from causes beyond the control of the
Respondent or of any entity controlled by Respondent, including their
contractors and subcontractors, that delays the timely performance of any
obligation under this Consent order, notwithstanding Respondent's best
efforts to avoid delay. The requirement that the Respondent exercise "best
efforts" to avoid the delay includes using best efforts to anticipate any
potential Force Majeure event and to address the effects of any potential
Force Majeure event: (1) as it is occurring; and (2) following the
potential Force Majeure event, such that the delay is minimized to the
greatest extent practicable. Force Majeure events shall not include
increased costs or expenses of any work to be performed under this Consent
order or the financial difficulty of Respondent in performing such work.
20.2 If any event occurs or has occurred that may delay the
performance of any obligation under this Consent Order, whether or not
caused by a Force Majeure event, Respondent shall
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notify the U.S. EPA Project Coordinator (or, in his or her absence, the
Federal Facility Branch Chief, U.S. EPA Region 10), by telephone, within
forty-eight (48) hours after Respondent first became aware that the event
might cause a delay. Within five (5) business days thereafter, Respondent
shall provide a written statement of the reasons for the delay; the
anticipated duration of the delay; all actions taken or to be taken to
prevent or minimize the delay; and a schedule for implementation of any
measures to be taken to mitigate the effect of the delay. Respondent shall
exercise best efforts to avoid or minimize any delay and the effects of
such delay. Failure to comply with the above requirements as to any event
shall preclude Respondent from asserting any claim of Force Majeure as to
that event.
20.3 If EPA agrees that the delay or anticipated delay is
attributable to a Force Majeure event, the time for performance of the
obligations under this Consent Order that are directly affected by the
Force Majeure event shall be extended, by agreement of the parties, for a
period of time not to exceed the actual duration of the delay caused by the
Force Majeure event. An extension of the time for performance of the
obligation directly affected by the Force Majeure event shall not, of
itself, extend the time for performance of any subsequent obligation.
20.4 If U.S. EPA does not agree that the delay or
anticipated delay has been or will be caused by a Force Majeure event, or
does not agree with Respondent on the length of the
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proposed extension of time, the issue shall be subject to the dispute
resolution procedures set forth in Section XVIII of this Consent Order. In
any such proceeding, Respondent shall have the burden of demonstrating by a
preponderance of the evidence that the delay or anticipated delay has been
or will be caused by a Force Majeure event, that the duration of the delay
was or will be warranted under the circumstances, that Respondent exercised
or are using their best efforts to avoid and/or mitigate the effects of the
delay, and that Respondent complied with the requirements of Paragraph
20.1.
20.5 Should Respondent carry the burden set forth in the
preceding paragraph, the delay at issue shall not be deemed to be a
violation of the affected obligation of this Consent Order.
XXI. REIMBURSEMENT OF RESPONSE AND OVERSIGHT COSTS
21.1 After receipt of the final draft RI/FS
Reports, U.S. EPA will submit to Respondent a summary and demand for
payment of all response costs incurred by U.S. EPA with respect to the
RI/FS and this Consent order. Response costs ("Response Costs") shall
include all direct and indirect costs incurred in overseeing Respondent's
implementation of this Consent order and in performance by U.S. EPA of
activities required as part of the RI/FS under this Consent Order,
including, without limitation, costs incurred in conduct of the Baseline
Risk Assessment, in obtaining access, if necessary, and in implementing a
community relations program for the Site. All
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cost summaries will include U.S. EPA'S: (a) payroll and travel costs, (b)
contract costs, and (c)indirect costs, including the amount computed an the
basis of direct labor hours. U.S. EPA's certified Financial Management
System summary of unreimbursed response costs shall serve as the basis for
each demand for payment.
21.2 Subject to requests for supporting documentation under
Paragraph 21.4, within thirty (30) days of receipt of demand for payment,
the amount shall be due and payable and Respondent shall remit a certified
or cashier's check for the amount of such costs. If the amount of any
demand is not paid in full within thirty (30) days of receipt of the
demand, interest shall accrue on the unpaid balance at the interest rate
determined annually by the Secretary of the Treasury for interest on
investments of the Hazardous Substances Superfund, pursuant to Section
107(a) of CERCLA, 42 U.S.C. ss. 9607(a).
21.3 All checks shall be made payable to the Hazardous
Substances Superfund and shall include the name of the Site, the Site
identification number and account number, and shall indicate that payment
is on account of U.S. EPA response costs. Checks shall be forwarded to:
U.S. Environmental Protection Agency
Attn: Superfund Accounting
P.O. Box 360903M
Pittsburgh, PA 15251
Copies of each transmittal letter and check shall be sent simultaneously to
the U.S. EPA Project Coordinator.
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21.4 Upon request by the Respondent within thirty (30) days of
receipt of the demand for payment, U.S. EPA shall provide the following
supporting documentation for Response costs: employee time sheets for
payroll costs, receipts for travel costs, contractor invoices and
supporting documentation for contractor charges and expenses, and
computation of U.S. EPA indirect costs. Some of the requested information
may be redacted or issued only after Respondent agrees to protective
provisions if the information is subject to a claim of privilege or is
confidential business information.
21.5 Respondent may dispute payment of any portion of the
Response costs demanded by U.S. EPA, but only on the basis of accounting
errors, the inclusion of costs outside the scope of this Consent Order,
costs inconsistent with the NCP, or not in accordance with CERCLA. Any such
objection shall be made in writing within fifteen (15) days of receipt of
the requested supporting documentation and shall specifically identify the
disputed costs and the basis of the dispute. Any non-contested costs shall
be remitted by Respondent within the fifteen (15) day notice period and in
accordance with the procedures in Paragraphs 21.2 and 21.3 above. In the
event that dispute resolution under Section XVIII above is invoked with
respect to any cost item, Respondent shall pay disputed costs into an
escrow account while the dispute is pending. In any dispute resolution
proceeding, Respondent shall bear the burden of establishing its
contentions of inappropriate costs on the grounds set forth above.
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21.6 Except as provided in this Paragraph, this Consent Order
does not apply to Respondent's liability for past costs incurred by U.S.
EPA in connection with the removal response action, which is currently the
subject of litigation filed in the U.S. District Court for the District of
Alaska. In any settlement with the United States, however, Respondent (and
the federal agencies signatories to the Funding Agreement) shall receive
credit for expenses incurred by them under this Consent order in
determining their proportionate liability for response costs at the Site.
XXII. FINANCIAL ASSURANCE, INSURANCE AND INDEMNIFICATION
22.1 Respondent shall demonstrate its ability to
complete the Work and any other obligations required under this Consent
Order, by obtaining and presenting to U.S. EPA for its approval, within
thirty (30) days after the effective date of this Consent Order, one of the
following: (a) a performance bond; (b) one or more letters of credit
equaling the total estimated cost of the Work, less the portion to which
the federal government agencies and departments who are potentially
responsible parties have agreed to pay; (c) a guarantee to perform the Work
by parent or sibling corporation or subsidiaries of the Respondent; or (d)
internal corporate financial information sufficient to satisfy U.S. EPA
that Respondent's net worth is sufficient to make additional financial
assurances unnecessary. If internal financial information is relied upon,
the standards used to determine the adequacy of Respondent's
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resources (or the adequacy of the guarantees of the parent or sibling
corporations or subsidiaries) shall be equivalent to those set forth in 40
C.F.R. Part 265, Subpart H.
22.2 U.S. EPA will have forty-five (45) days from receipt of
the financial assurance or internal corporate information to determine its
adequacy and to communicate its determination to Respondent. If U.S. EPA
determines that such assurance or information is inadequate, Respondent
shall remedy the defect or submit one of the other forms of assurance to
U.S. EPA for its approval. If internal corporate information is relied
upon, Respondent shall submit updated financial information annually, on
the anniversary of the effective date of this Consent Order.
22.3 In no event shall work required under this Consent Order
be delayed pending submission and/or approval of financial assurances under
this Section.
22.4 (a) Prior to commencing any work under this Consent
Order, Respondent shall obtain comprehensive general liability ("CGL") and
automobile insurance with limits of at least three million dollars
($3,000,000), combined single limit per occurrence, naming the United
States as additional insured, to insure against all claims of injury or
property damage to third parties arising from or related to such work. Such
insurance shall be maintained for the duration of this Consent Order and
for two years after completion of all work required hereunder. In lieu of
such coverage, Respondent, at its option,
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may provide evidence of financial capacity sufficient for purposes of
self-insurance pursuant to the requirements in 40 C.F.R. Part 265, Subpart
H.
(b) Respondent may demonstrate by evidence
satisfactory to U.S. EPA that its contractor or subcontractors maintain
equivalent coverage, or coverage for the same risks but in a lesser amount
or for lesser terms, in which case Respondent need provide only that
portion of the insurance described above which is not maintained by the
contractor or subcontractor. At least seven (7) days prior to commencing
any work under this Consent Order, Respondent shall provide U.S. EPA with
copies of the applicable policies or other evidence of the required
coverage.
(c) For the duration of this Consent Order,
Respondent shall satisfy, or ensure that its contractors or subcontractors
satisfy, all applicable laws and regulations regarding workers'
compensation coverage for all persons performing work on their behalf in
implementing this Consent Order. Prior to commencing such work, Respondent
shall provide U.S. EPA with copies of the applicable policies or other
evidence of such coverage.
22.5 Respondent agrees to indemnify and hold the United
States, its agencies, departments, agents and employees, excluding the
United States and its agencies, departments, agents and employees in their
role as Potentially Responsible Parties, harmless from any and all claims
or causes of action arising from
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or on account of acts or omissions of Respondent, its employees,
contractors, agents, receivers, successors, or assigns in carrying out
activities under this Consent Order. The United States or any agency or
authorized representative thereof shall not be held out as a party to any
contract entered into by Respondent in carrying out activities under this
Consent Order.
XXIII. JUDICIAL REVIEW
23.1 Nothing in this Consent Order shall be construed as
authorizing any person to seek judicial review of any action or work where
review is barred by any provision of CERCLA, including, without limitation,
Section 113(h) of CERCLA, 42 U.S.C. ss. 9613(h).
XXIV. RESERVATIONS OF RIGHTS
24.1 An action is pending in U.S. District Court for the
District of Alaska for recovery of past costs incurred at the Site, and for
other relief. With exception of these past costs, U.S. EPA reserves the
right to bring an action against Respondent under Section 107 of CERCLA, 42
U.S.C. ss. 9607, for recovery of all response costs, including oversight
costs, incurred by the United States at the Site that are not reimbursed by
Respondent, any costs incurred in the event that U.S. EPA performs any
work, and any future costs incurred by the United States in connection with
response activities conducted under CERCLA at this Site.
24.2 U.S. EPA reserves the right to bring an
action against Respondent to collect stipulated penalties
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assessed pursuant to Section XIX of this Consent Order, or to elect to seek
penalties pursuant to Section 109 of CERCLA, 42 U.S.C. ss. 9609.
24.3 Respondent retains its right to assert any claims f(Dr
contribution or otherwise it may have against other potentiaLly responsible
parties at the Site.
24.4 Except as expressly provided in this Consent order, each
party reserves all other rights and defenses it may have. Nothing in this
Consent order shall affect U.S. EPA's emergency removal authority or its
enforcement authorities including, but not limited to, the right to seek
injunctive relief, stipulated or statutory penalties, and/or punitive
damages.
24.5 Upon satisfactory completion of the requirements of this
Consent Order, Respondent (and the federal agencies, signatories to the
Funding Agreement) shall have resolved their liability to U.S. EPA for the
Work performed and the Response Costs incurred in connection with the
RI/FS. Respondent is not released from liability, however, for any response
actions taken at the Site beyond the scope of this Consent order including
removals, remedial action or activities under section 121(c) of CERCLA, 42
U.S.C. ss. 9621(c).
XXV. OTHER CLAIMS
25.1 In entering into this Consent Order,
Respondent waives any right to seek reimbursement under Section 106(b) of
CERCLA, 42 U.S.C. ss. 9606(b) and any right to present
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claims under Sections 111 or 112 of CERCLA, 42 U.S.C. ss.ss. 9611 or 9612
for the Work. This Consent Order does not constitute any decision on
preauthorization of funds under Section 111(a)(2) of CERCLA, 42 U.S.C. ss.
9611(a)(2). Subject to Section 25.2 of this Consent order, Respondent
further waives all other statutory and common law claims against the United
States, including, but not limited to, contribution and counterclaims,
relating to or arising out of conduct of the RI/FS.
25.2 Nothing in this Consent order shall constitute or be
construed as a release from any claim, cause of action, or demand in law or
equity against the United States, its agencies, departments, agents and
employees in their role as Potentially Responsible Parties, or against any
person, or entity not a signatory to this Consent Order for any liability
it may have arising out of or relating in any way to the generation,
storage, treatment, handling, transportation, release, or disposal of any
hazardous substances, pollutants, or contaminants found at, taken to or
from the Site.
25.3 Respondent shall not recover its own costs
and attorneys fees from U.S. EPA and/or the United States.
XXVI. EFFECTIVE DATE AND SUBSEQUENT MODIFICATION
26.1 The effective date of this Consent Order
shall be the date it is signed by all parties to this Consent order.
26.2 This Consent Order may be amended by mutual
agreement of U.S. EPA and Respondent. All such amendments shall
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be in writing and shall be effective when signed by all parties to this
Consent Order. U.S. EPA Project Coordinators are not authorized to sign
amendments to the Consent Order.
26.3 No informal advice, guidance, suggestions or comments by
U.S. EPA regarding reports, plans, specifications, schedules or any other
document submitted by the Respondent shall be construed as relieving the
Respondent of its obligation to obtain such formal approval as may be
required by this Consent order.
XXVII. SATISFACTION
27.1 The provisions of this Consent Order shall be satisfied
when Respondent certifies in writing to U.S. EPA that all activities
required under this Consent Order, including any additional work and
payment of costs and any stipulated penalties demanded by U.S. EPA, have
been performed and/or paid, and U.S. EPA has approved the certification.
U.S. EPA will respond within thirty (30) days to any such request for
approval of Respondent's certification or within a longer period of time as
may be agreed to by the Project Coordinators. If the U.S. EPA does not
respond within thirty days after receipt of Respondent's request or within
the agreed on time, or responds unfavorably, the Respondent may invoke
dispute resolution under Section XVIII. Such certification and approval
shall not, however, terminate Respondent's obligation to comply with
Sections XVII and XXII of this Consent Order.
27.2 The certification required in the preceding
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paragraph shall be signed by a responsible official representing
Respondent, who shall certify that the information contained in or
accompanying the certification is true, accurate, and complete. For
purposes of this Consent Order, a responsible official is a corporate
official in charge of a principal business function.
XXVIII. SEPARATE DOCUMENTS
28.1 This Consent Order may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
XXIX. CONTINGENT RIGHT TO WITHDRAW
29.1 If within 60 days of the execution of this Consent order
by Respondent the Funding Agreement, dated September 23, 1992 (referenced
in Paragraph 5.13), is not approved and executed by an authorized United
States Assistant Attorney General in its current form, or in a form
otherwise acceptable to Respondent, and thereby made binding upon the
federal agency parties, the Respondent shall have the right to withdraw its
consent to and approval of this Consent Order by written notice to U.S.
EPA. Such right to withdraw shall be continuing but shall terminate at such
time as such a Funding Agreement is fully executed and made binding upon
all parties thereto. In the event Respondent exercises the right to
withdraw pursuant to this provision, such withdrawal shall be effective
immediately upon delivery of written notice to U.S. EPA and
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Respondent shall be relieved of all obligations under this Consent Order,
provided, however, that Respondent shall, upon request, provide to the U.S.
EPA Project Coordinator any sampling information and/or other data
collected pursuant to this Consent order prior to withdrawal. In the event
of any withdrawal, neither the prior approval of this Consent Order by
Respondent nor the withdrawal from it shall enlarge or diminish any
obligation or liability of Respondent which may exist at any time
independent of this Consent order.
By: /s/ Randall F. Smith Date: 9/25/92
RANDALL F. SMITH, Director
Hazardous Waste Division
Region 10 1200 Sixth Avenue
Seattle, Washington 98101
ADMINISTRATIVE ORDER ON CONSENT FOR
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STIPULATED, AGREED, AND APPROVED FOR ISSUANCE
CHUGACH ELECTRIC ASSOCIATION, INC.
By: /s/ Evan J. Griffith, Jr. 9/23/92
Date
Acting Gen'l Mgr
Title
Evan J. Griffith, Jr.
Acting General Manager
Address
ADMINISTRATIVE ORDER ON CONSENT FOR
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1
APPENDIX 1
STATEMENT OF WORK
STANDARD STEEL AND METALS SALVAGE YARD
REMEDIAL INVESTIGATION AND FEASIBILITY STUDY
INTRODUCTION
The purpose of this Remedial Investigation/Feasibility Study (RI/FS) is
to investigate the nature and extent of contamination at the Standard Steel
Metals and Salvage Yard ("Site") located in Anchorage, Alaska and develop and
evaluate remedial alternatives. The RI and FS are interactive and may be
conducted concurrently so that the data collected in the RI influences the
development of remedial alternatives in the FS, which in turn affects the data
needs and the scope of treatability studies.
The Respondents will conduct this RI/FS (except for the baseline risk
assessment component) in accordance with the Administrative Order on Consent
("AOC") to which this Statement of Work is attached. Respondents will produce
draft RI and FS reports that are in accordance with this SOW, the Guidance for
Conducting Remedial Investigations and Feasibility Studies Under CERCLA (U.S.
EPA, Office of Emergency and Remedial Response, October 1988, OSWER Directive
No. 9355.3-01) (the "RI/FS Guidance"), and other guidances that the U.S.
Environmental Protection Agency ("U.S. EPA") uses in conducting a RI/FS (a list
of primary guidance is attached). The RI/FS Guidance describes the report format
and the required report content. The Respondents will furnish all necessary
personnel, materials, and services; needed, or incidental to performing the
RI/FS, except as otherwise specified in the AOC.
At the completion of the RI/FS, U.S. EPA will be responsible for the
selection of a site remedy, which it will document in a Record of Decision
("ROD"). The final RI/FS report, as adopted by U.S. EPA, and U.S. EPA's baseline
risk assessment, together with the administrative record, will form the basis
for the selection of the remedy at the Site and will provide the information
necessary for preparation of the ROD.
The remedial action alternative selected by U.S. EPA will meet the
cleanup standards specified in Section 121 of the Comprehensive Environmental
Response, compensation, and Liability Act ("CERCLA"), as amended by the
Superfund Amendments and Reauthorization Act of 1986 ("SARA"), 42 U.S.C. ss.
9621. That is, the selected remedial action will be protective of human health
and the environment, will be in compliance with, or include a waiver of,
applicable or relevant and appropriate requirements of other laws, will be
cost-effective, will utilize permanent
August 17, 1992
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2
solutions and alternature treatment technologies or resource recovery
technologies, to the maximum extent practicable, and will address the statutory
preference for treatment as a principal element.
TASK 1 - SCOPING (RI/FS Guidance, Chapter 2)
The specific project scope will be planned by the Respondents and U.S.
EPA. The respondent will document the specific project scope in a Work Plan in
accordance with the RI/FS Guidance and other applicable guidances. Because the
work required to perform a RI/FS is not fully known at the outset, and is phased
in accordance with the Site's complexity and the amount of available
information, it may be necessary to modify the Work Plan during the RI/FS to
satisfy the objectives of the study.
Based on available information, the site objectives for the Site have
been determined preliminarily to be the following:
Gather data of sufficient quantity and quality concerning contaminants
in groundwater, surface water, soil, sediments, and air to conduct a
Baseline Risk Assessment (human health and ecological), to determine
nature and extent of contaminants, contaminant fate and transport, and
to select the appropriate remedial action by conducting a feasibility
sturdy.
A sampling strategy will be agreed upon by U.S. EPA and the Respondents
which meets the foregoing objectives based on the nature and extent of
contamination at the site. Data gathered from the sampling activity will then be
used to meet all of the requirements of an RI/FS, which are outlined in this
SOW.
Respondents shall conduct the scoping activities described
in the RI/FS Guidance, Chapter 2 to the extent applicable to the Site and
as required by U.S. EPA. Respondents have provided U.S. EPA with a draft Work
Plan. U.S. EPA and Respondents are currently negotiating and discussing the
site-specific project scope. At the conclusion of the project planning phase,
Respondents shall provide U.S. EPA with the following deliverables:
(a) Draft Final RI Work Plan. Within 30 days of
the effective date of this Consent order, Respondents
shall submit to U.S. EPA a draft final RI Work Plan.
(b) Sampling and Analysis Plan. Within 30 days
of the effective date of this Consent Order,
Respondent(s) shall submit to U.S. EPA a draft final
Sampling and Analysis Plan. This plan shall include a
August 17, 1992
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3
Field Sampling Plan ("FSP") and a Quality Assurance
Project Plan ("QAPP").
(c) Site Health and Safety Plan. Within 30 days
of the effective date of this consent Order,
Respondents shall submit to U.S. EPA a Health and
Safety Plan for the Site.
(d) Draft Final FS Work Plan. Within 120 days of
the effective date of this Consent Order, Respondents
shall submit to U.S. EPA a draft final FS
Work Plan, which shall include:
(i) Identification of Candidate Technologies
Memorandum.
TASK 2 COMMUNITY RELATIONS
U.S. EPA will prepare a Community Relations Plan ("CRP") for
the RI/FS, in accordance with U.S. EPA guidances and the NCP. Upon request,
Respondents shall provide information to U.S. EPA to support its community
relations program. In addition, the Respondents may establish a community
information repository, at or near the site, to house one copy of the
administrative record. The extent of PRP involvement in CRP activities is left
to the discretion of U.S. EPA. The Respondents' community relations
responsibilities, if any, are specified in the community relations plan. All
PRP-conducted community relations activities will be subject to oversight by
U.S. EPA.
TASK 3 -- SITE CHARACTERIZATION (RI/FS Guidance, Chapter 3)
Following U.S. EPA approval or modification of the RI Work Plan and
Sampling and Analysis Plan, Respondents shall perform Site Characterization as
specified in the Work Plans, as they may be modified in accordance with the
procedures set forth in the AOC. Site Characterization shall be performed in
accordance with the RI/FS Guidance and any other applicable guidances.
Respondents shall verbally notify U.S. EPA at least fifteen (15) days prior to
conducting field events. Respondents shall provide U.S. EPA with analytical data
within ten (10) days of receipt of sampling results from each sampling activity.
Such data shall be provided in a electronic format (i.e., computer disk) showing
the location, medium, and results. Within seven (7) days of completion of field
activities, Respondents shall notify U.S.
EPA, in writing, of such completion.
During Site Characterization, Respondent(s) shall provide U.S. EPA with
the following deliverables, as described in the RI/FS Guidance and/or Work Plan:
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4
(a) Technical Memorandum on Modeling of Site
Characteristics. Where Respondents propose that modeling is
appropriate, Respondents shall submit a Technical Memorandum on
Modeling parameters within 30 days of their proposal.
(b) Preliminary Site Data Summary. Within 30
days of completion of the field sampling and receipt of
laboratory analysis for any phase of the remedial
investigation, Respondents shall submit a Site Data Summary
to U.S. EPA.
(c) Draft Remedial Investigation Report. Within 120
days of completion of the on-site work for all phases of the remedial
investigation, Respondents shall submit a draft RI Report consistent
with the RI/FS Guidance, Work Plan, and Sampling and Analysis Plan.
TASK 4 - TREATABILITY STUDIES (R1/FS Manual, Chapter 5)
Respondents shall conduct treatability studies, except where
they can demonstrate to U.S. EPA's satisfaction that they are not needed. The
treatability studies shall include determination of the need for and scope of
such studies and the design and completion of the studies, as described in the
RI/FS Guidance, Chapter 5. During treatability studies, Respondents shall
provide U.S. EPA with the following deliverables:
(a) Treatability Testing Work Plan. If U.S. EPA
determines that treatability testing is required, within 90 days
thereafter (or as specified by U.S. EPA), Respondents shall
submit a Treatability Testing Work Plan. The Treatability Testing
Work Plan shall include the following components:
(i) Treatability Testing Schedule;
(ii) Treatability Study Sampling and Analysis
Plan (if the need for a separate or revised QAPP or FSP is
identified by U.S. EPA); and
(iii) Treatability Study Site Health and
Safety Plan (if the need for a revised health and safety
plan is identified by U.S. EPA).
(c) Treatability Study Evaluation Report. Within 45
days of receipt of treatability testing results, Respondents shall
submit a treatability study evaluation report as provided in the RI/FS
Guidance and Work Plan.
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5
TASK 5 - DEVELOPMENT AND SCREENING OF Remedial Alternatives (Rl/FS
Manual, Chapter 4)
Respondents shall develop an appropriate range of waste management
options that will be evaluated through the development and screening of
alternatives, as provided in the RI/FS Guidance, Chapter 4 and Work Plan. During
the development and screening of alternatives, Respondents shall provide U.S.
EPA with the following deliverables:
(a) Memorandum on Remedial Action Objectives.
Within 60 days of receipt of U.S. EPA's Baseline Risk
Assessment, Respondents shall submit a memorandum on remedial action
objectives. U.S. EPA's Baseline Risk Assessment shall be submitted to
Respondents after all sampling phases approved in the RI Work Plan are
completed.
(b) Memorandum on Development and Preliminary
Screening of Alternatives, Assembled Alternatives Screening Results and
Final Screening. Within 30 days of approval of the memorandum on
remedial action objectives, Respondents shall submit a memorandum
summarizing the development and screening of remedial alternatives,
including an alternatives array document, as described in the RI/FS
Guidance.
TASK 6 - DETAILED ANALYSIS OF REMEDIAL ALTERNATIVES (RI/FS Guidance, Chapter
6)
Respondents shall conduct a detailed analysis of remedial alternatives,
as described in the RI/FS Guidance, Chapter 6 and Work Plan. During the detailed
analysis of alternatives, Respondents shall provide U.S. EPA with the following
deliverables:
(a) Report on Comparative Analysis and Presentation
to U.S. EPA. Within 10 days of approval of a memorandum on the
development and screening of remedial alternatives, Respondents shall
submit a report to U.S. EPA summarizing the results of the comparative
analysis of the remedial alternatives. within fourteen (14) days of
submitting the original report, Respondents shall make a presentation
to U.S. EPA summarizing the findings of the RI and remedial action
objectives and presenting the results of the nine criteria evaluation
and comparative analysis as described in the RI/FS Guidance.
(b) Draft Feasibility Study Report. Within 20
days of the above presentation, Respondents shall submit a
August 17, 1992
<PAGE>
6
draft FS report which reflects the findings in U.S. EPA's Baseline Risk
Assessment and documents the development and analysis of remedial
alternatives. Respondents shall refer to Table 6-5 of the RI/FS
Guidance for the content and format of this report. The report, any
amendments thereto, and the administrative record established pursuant
to Section 113(k) of CERCLA, 42 U.S.C. ss. 9313(k), shall provide the
basis for a Proposed Plan to be issued by U.S. EPA pursuant to Section
117(a) of CERCLA, 42 U.S.C. ss. 9617(a).
Notwithstanding the schedules contained herein, Respondents shall
submit the final draft RI and FS no later than 2-8 months from the effective
date of the Consent Order. This time period may be extended for Force Majeure
events and at the agreement of the parties to the Consent Order. If the parties
cannot agree to such extension, the issue is subject to the Dispute Resolution
provisions contained in Section XVIII of the Consent Order.
Task 7 INTERIM REMEDIAL ACTION or NEW REMOVAL ACTION
Upon Respondents' proposal and U.S. EPA's determination that an Interim
Remedial Action or new Removal Action would result in a significant reduction in
mobility, toxicity, and volume of contamination at the Site in defined source
areas, Respondents will submit a Work Plan for such action within 30 days after
such determination. Such Work Plan shall address the performance of the
necessary actions. Any Interim Remedial Action or new Removal Action Work Plan
will be consistent with U.S. EPA guidance on conducting remedial design and
remedial actions, the NCP, and shall include subtasks outlined in Tasks I and VI
above, unless otherwise agreed to by U.S. EPA. Any Interim Remedial or Removal
Action shall be consistent with long-term remedial action to be taken at the
Site.
August 17, 1992
<PAGE>
7
REFERENCES
The following list, although not comprehensive, comprises many of the
regulations and guidance documents that apply to the RI/FS process:
The (revised) National Contingency Plan
"Guidance for Conducting Remedial Investigations and Feasibility
Studies Under CERCLA," U.S. EPA, Office of Emergency and Remedial
Response, October 1988, OSWER Directive No. 9355.3-01.
"Interim Guidance on Potentially Responsible Party Participation
in Remedial Investigation and Feasibility Studies," U.S. EPA,
office of Waste Programs Enforcement, Appendix A to OSWERR
Directive No. 9355.3-01.
"Guidance on Oversight of Potentially Responsible Party Remedial
Investigations and Feasibility Studies," U.S. EPA, Office of
Waste Programs Enforcement, OSWER Directive NO. 9835.3.
"A Compendium of Superfund Field Operations Methods, "Two
Volumes, U.S. EPA, Office of Emergency and Remedial Response,
EPA/540/P-87/001a, August 1987, OSWER Directive No. 9355.0-14.
"EPA NEIC Policies and Procedures Manual," May 1978, revised November 1984,
EPA-330/9-78-001-R.
"Data Quality Objectives for Remedial Response Activities," U.S.
EPA, Office of Emergency and Remedial Response and Office of
Waste Programs Enforcement, EPA/540/G-87/003, March 1987, OSWER
Directive No. 9335.O-7B.
"Guidelines and Specifications for Preparing Quality Assurance
Project Plans," U.S. EPA, Office of Research and Development,
Cincinnati, OH, QAMS-004/80, December 29, 1980.
"Interim Guidelines and Specifications for Preparing Quality
Assurance Project Plans," U.S. EPA, Office of Emergency and
Remedial Response, QAMS-005/80, December 1980.
"Users Guide to the EPA Contract Laboratory Program," U.S. EPA
Sample Management Office, August 1982.
"Interim Guidance on Compliance with Applicable or Relevant and
Appropriate Requirements," U.S. EPA, office of Emergency and
Remedial Response, July 9, 1987, OSWER Directive No. 9234.0-05.
August 17, 1992
<PAGE>
8
"CERCLA Compliance with Other Laws Manual," Two Volumes, U.S.
EPA, Office of Emergency and Remedial Response, August 1988
(draft), OSWER Directive No. 9234.1-01 and -02.
"Guidance on Remedial Actions for Contaminated Ground Water at
Superfund Sites," U.S. EPA, Office of Emergency and Remedial
Response, (draft), OSWER Directive No. 9283.1-2.
"Draft Guidance on Preparing Superfund Decision Documents," U.S.
EPA, Office of Emergency and Remedial Response, March 1988, OSWER
Directive No. 9355.3-02.
"Risk Assessment Guidance for Superfund - Volume II Environmental
Evaluation Manual," March 1989, EPA/540/1-89/001.
"Guidance for Data Useability in Risk Assessment," October, 1990,
EPA/540/G-90/008.
"Performance of Risk Assessments in Remedial
Investigation/Feasibility Studies (RI/FSs) Conducted by
Potentially Responsible Parties (PRPs)," August 28, 1990, OSWER
Directive No. 9835.15.
"Role of the Baseline Risk Assessment in Superfund Remedy
Selection Decisions," April 22, 1991, OSWER Directive No. 9355.0
30.
"Health and Safety Requirements of Employees Employed in Field
Activities," U.S. EPA, Office of Emergency and Remedial Response,
July 12, 1981, EPA Order No. 1440.2.
OSHA Regulations in 29 CFR 1910.120 (Federal Register 45654, December 19, 1986).
"Interim Guidance on Administrative Records for Selection of
CERCLA Response Actions," U.S. EPA, Office of Waste Programs
Enforcement, March 1, 1989, OSWER Directive No. 9833.3A.
"Community Relations in Superfund: A Handbook," U.S. EPA, Office
of Emergency and Remedial Response, June 1988, OSWER Directive
No. 9230.033B.
"Community Relations During Enforcement Activities And
Development of the Administrative Record," U.S. EPA, Office of
Programs Enforcement, November 1988, OSWER Directive No.
9836.01A.
August 17, 1992
<PAGE>
APPENDIX 2 TO PARTIAL CONSENT DECREE
FUNDING AGREEMENT FOR THE
STANDARD STEEL SUPERFUND SITE
REMEDIAL INVESTIGATION/FEASIBILITY STUDY
This Funding Agreement ("Agreement") is made by and between CHUGACH
ELECTRIC ASSOCIATION, INC. ("Chugach") and the UNITED STATES OF AMERICA, acting
on behalf of the Department of Transportation (including the Federal Railroad
Administration), and the Department of Defense (including the Defense Logistics
Agency and the Defense Reutilization and Marketing Service) for the purpose of
providing the funding required to conduct a remedial investigation and
feasibility study ("RI/FS") at the Standard Steel and Metals Salvage Yard
Superfund Site, 2400 Railroad Avenue, Anchorage, Alaska 99501.
WHEREAS, the United States Environmental Protection Agency
("EPA") has placed the Standard Steel Superfund Site on the
National Priorities List (55 Fed. Reg. 35502, 35509 (August 30,
1990)), and made demand on certain potentially responsible
parties to conduct response action at the Site;
WHEREAS, the necessary first step preceding any further
response action is the conduct of an RI/FS;
WHEREAS, the parties to this Agreement agree that the most
cost-effective means of conducting the RI/FS involves the use of private
contractors retained by, and working under the direct supervision of, a
nongovernment entity;
WHEREAS, Chugach has entered into an Administrative order on Consent
with EPA governing the specific tasks to be accomplished and standards to be met
during the conduct of the RI/FS and
FUNDING AGREEMENT - September 23, 1992
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<PAGE>
requiring payment to EPA of response and oversight costs incurred
by EPA with respect to the RI/FS;
WHEREAS, the parties agree that certain federal agencies will
contribute to the costs of the RI/FS, including EPA-incurred and reimbursed
response and oversight costs related to the RI/FS, as provided for in this
Agreement; and
NOW, THEREFORE, in consideration of the mutual promises and conditions
contained herein, and without admission of any fact or legal conclusion, the
parties hereby agree:
DEFINITIONS
a. "Chugach" shall mean Chugach Electric Association,
Inc., an Alaska nonprofit electric cooperative corporation.
b. "Settling Federal Agencies" shall mean the Department
of Transportation (including the Federal Railroad
Administration), and the Department of Defense (including the
Defense Logistics Agency and the Defense Reutilization and
Marketing Service).
c. "Site" shall mean the Standard Steel and Metals Salvage Yard
Superfund Site, 2400 Railroad Avenue, Anchorage, Alaska 99501, and any
surrounding areas where work is necessary to complete the RI/FS that is the
subject of this Agreement.
d. "Consent Order" shall mean the Administrative Order on Consent
entered in the proceedings styled IN THE MATTER OF THE STANDARD STEEL AND METALS
SALVAGE YARD SUPERFUND SITE, EPA Docket Nos. 1091-07-02-107 and 1091-07-01-120
and dated September 23, 1992.
FUNDING AGREEMENT - September 23, 1992
PAGE 2
<PAGE>
e. "RI/FS" shall mean any and all work conducted, or incidental
expenses incurred, pursuant to the Consent Order defined in subpart d, supra,
but does not include the costs of removing scrap from the Site, whether or not
that material is contaminated.
f. "Oversight Costs" shall mean all direct and indirect costs incurred
by EPA in overseeing Chugach's implementation of the Consent Order and in
conducting activities required as part of the RI/FS under the Consent Order,
including, without limitation, costs incurred by EPA in conducting the Baseline
Risk Assessment, as defined in the Consent Order, in obtaining access to the
Site, if necessary, and in implementing a community relations program for the
Site.
PAYMENTS BY THE UNITED STATES
1. The United States, on behalf of the Settling Federal Agencies, shall
reimburse Chugach seventy-five percent (75%) of all Oversight Costs and costs of
performing the RI/FS pursuant to the Consent Order, including, without
limitation, all costs of RI/FS-related work performed by Chugach's contractor
(and its subcontractors and agents) prior to execution of the Consent Order.
2. Payment by the United States pursuant to Paragraph 1 shall be made
only for Oversight Costs charged to Chugach and the costs of performing the
RI/FS on time and in satisfactory fashion as required under the Consent Order,
including costs for RI/FSrelated work performed prior to execution of the
Consent Order as
FUNDING AGREEMENT - September 23, 1992
PAGE 3
<PAGE>
provided in Paragraph 1. The Settling Federal Agencies shall not
reimburse other expenses, including, but not limited to:
a. Payment of fines, stipulated penalties, or other
sanctions imposed as a result of any failure to complete
work required by the Consent Order on time and in
satisfactory fashion;
b. Payment of Chugach's administrative expenses,
including: (1) costs incurred in connection with contractor
selection and supervision; and (2) costs incurred in
connection with Chugach's oversight of its contractors
working at the Site; and
c. Payment of Chugach's attorneys' fees.
3. Payments pursuant to Paragraph 1 shall be made in
accordance with the following provisions:
a. For RI/FS costs other than Oversight Costs, Chugach shall,
on a bimonthly basis until Chugach certifies that the RI/FS is
completed, submit to the Project Coordinator for the settling Federal
Agencies (specified in Paragraph 17) payment demands with accompanying
invoices that precisely detail the RI/FS work performed for which
payment is demanded (itemized by task), the expenses incurred, the
hours required for performance of such work and the charges therefor as
billed to Chugach and allocated to the United States in accordance with
Paragraphs 1 and 2.
b. In addition to the payment procedure provided in Paragraph
3.a., Chugach shall submit to the Project Coordinator for the Settling
Federal Agencies a payment demand dated September 30, 1992 with an
accompanying invoice for the costs (not including Oversight Costs) of
all RI/FS related work performed through August 31, 1992 by Chugach's
contractor, together with any subcontractors and agents, as billed to
Chugach and allocated to the United States in accordance with
Paragraphs 1 and 2.
c. Each payment demand made under Paragraphs 3.a. and
3.b. shall specify that the amount demanded does not include
Oversight Costs and shall be accompanied by a certification
executed by Chugach as follows:
"Chugach certifies that the costs referenced in the attached
invoice were properly incurred pursuant to the Consent Order
and the separate Funding Agreement governing
FUNDING AGREEMENT - September 23, 1992
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<PAGE>
submission of this request for payment. Payment by the United
States of all amounts in the attached invoice as demanded by
Chugach shall be accepted by Chugach as payment in full of all
sums owing under the Funding Agreement by the Settling Federal
Agencies for services performed by Chugach's consultant,
together with any services billed to such consultant by
others, through the closing date reflected on the attached
invoice."
d. For Oversight Costs, Chugach shall, upon payment of
Oversight Costs as demanded or invoiced by EPA in accordance with the
Consent Order, submit to the Project Coordinator for the Settling
Federal Agencies a separate payment demand with an accompanying copy of
EPA's demand or invoice for Oversight Costs as billed to Chugach and
allocated to the United States in accordance with Paragraphs 1 and 2.
e. The payment demand made under Paragraph 3.d. shall
be accompanied by a certification executed by Chugach as
follows:
"Chugach certifies that the Oversight Costs referenced in the
attached invoice or demand were properly incurred by Chugach
pursuant to the Consent order and the separate Funding
Agreement governing submission of this request for payment.
Payment by the United States of all amounts in the attached
invoice or demand as demanded by Chugach shall be accepted by
Chugach as payment in full of all sums owing under the Funding
Agreement by the Settling Federal Agencies for oversight Costs
through the date of the attached invoice Or demand.
f. Payment of all amounts under this Agreement shall be made
directly to Chugach's Project coordinator in accordance with
instructions accompanying the payment demand and shall include interest
calculated and added to each payment by the United states, accruing
from the date of the payment demand to the date of payment at the rate
provided in CERCLA ss. 107(a), 42 U.S.C. ss. 9607(a). For purposes of
this paragraph, the "date of payment" shall be deemed to be the date
that a check is issued by the United States to satisfy each payment
demand under this Agreement.
FUNDING AGREEMENT - September 23, 1992
PAGE 5
<PAGE>
g. The United States shall make payment of all amounts
hereunder, except such amounts as are withheld or disputed in
accordance with this subparagraph 3.g., to Chugach's Project
Coordinator within 90 days after the date of the payment demand. If the
United States in good faith questions or contests any invoiced fees or
expenses, it shall have the right to withhold payment of such disputed
amount; provided, however, the United States shall notify Chugach in
writing of any disputed amount or item set forth in a payment demand
within thirty (30) days of the date of such payment demand and shall
make a good faith effort to resolve such dispute quickly with Chugach.
If a dispute regarding invoiced fees or expenses cannot be resolved
informally, the United States shall commence dispute resolution within
90 days after the date of the payment demand.
4. Payments by the United States on behalf of Settling Federal Agencies
are subject to the availability of appropriated funds. No provision of this
Agreement shall be interpreted as or constitute a commitment or requirement that
the Settling Federal Agencies obligate or pay funds in contravention of the Anti
Deficiency Act, 31 U.S.C. ss. 1341.
CONDUCT OF THE RI/FS BY CHUGACH
5. Chugach shall be responsible, without further contribution by the
Settling Federal Agencies, for the conduct of the RI/FS in a timely and
workmanlike fashion, in accordance with the provisions of the Consent Order.
Chugach shall select and engage such contractors, consultants and other
personnel as may be required pursuant to the Consent order, or otherwise
necessary to complete the RI/FS, and shall be exclusively responsible for any
fines, stipulated penalties, or other sanctions imposed as a result of Chugach's
or its agents', employees', or contractors' failure to complete work required by
the Consent Order on time
FUNDING AGREEMENT - September 23, 1992
PAGE 6
<PAGE>
and in satisfactory fashion. Nothing in this Agreement, however, shall be
construed to restrict any right Chugach may have to contest any such fines,
penalties, or sanctions.
RECORDS, AUDITING, AND RECONCILIATION
6. Chugach shall maintain all books, records, documents, and other
evidence, including descriptions of accounting procedures and practices,
necessary to document each and every expenditure relating to the RI/FS. The same
records shall be subject to the record preservation provisions of the Consent
Order, and shall not be disposed of or destroyed except in accordance with those
provisions and the terms of this Agreement.
7. In addition, Chugach shall notify the Project Coordinator for the
Settling Federal Agencies (specified in Paragraph 17) at least ninety (90) days
before documents relating to RI/FS expenditures are to be destroyed; provided,
however, no documents relating to RI/FS expenditures may be destroyed until at
least ninety (90) days after Chugach's delivery of the accounting required
pursuant to Paragraph 9. If, within ninety (90) days after being notified of
Chugach's intent to destroy any documents relating to RI/FS expenditures, any
Settling Federal Agency requests that the documents be saved, Chugach shall make
the original documents available or provide accurate copies thereof to the
Settling Federal Agencies' Project coordinator. Chugach's obligations under this
Paragraph shall terminate three (3) years after Chugach's delivery of the
accounting required pursuant to Paragraph 9.
FUNDING AGREEMENT - September 23, 1992
PAGE 7
<PAGE>
8. Chugach shall establish a single designated repository for
accounting and records maintenance; shall keep the records referenced in
Paragraph 6 current in accordance with good accounting practice; and shall make
those records available to the Settling Federal Agencies at all reasonable times
for inspection, audit, and reproduction.
9. Not later than 120 days after Chugach certifies completion of the
RI/FS pursuant to Consent Order Paragraph 27.1, Chugach shall deliver to the
Project Coordinator for the Settling Federal Agencies a full and final
accounting of the expenditures relating to the conduct of the RI/FS.
10. Should the final accounting rendered pursuant to Paragraph 9 or an
audit by any competent authority reveal that RI/FS expenditures were contrary to
the provisions of Paragraph 2, Chugach shall reimburse the United States for
those expenditures that Chugach agrees were contrary to the provisions of
Paragraph 2 and shall commence dispute resolution with respect to any contested
amounts within 90 days after delivery of the audit or final accounting.
REPORTS
11. Chugach shall provide copies of the following items to
the Project Coordinator for the Settling Federal Agencies:
* Copies of the progress reports required to be submitted
to EPA under Paragraph 13.1 of the Consent Order
* Draft and Final Work Plans
* Draft Sampling and Analysis Plan
FUNDING AGREEMENT - September 23, 1992
PAGE 8
<PAGE>
* Site Health and Safety Plan
* Site Data Summaries for the following:
* Groundwater Well Samples
* Soil Borings
* Surface Soil Samples
* Creek Samples
* Air Samples
* Surface Water Run-Off Evaluation
* Draft and Final RI Reports
* Draft and Final FS Reports
DISPUTE RESOLUTION
12. Should the parties disagree about any material aspect of the effect
or interpretation of this Agreement, either party may send the other party a
written notice which outlines the nature of the dispute and requests informal
negotiations. If the parties cannot reach an agreed resolution within thirty
(30) working days, each party reserves whatever rights it may have to secure
relief in a court of competent jurisdiction. Nothing in Paragraph 2 of this
Agreement shall be construed as a waiver of any party's right, if any, to
collect costs, including attorneys' fees, awarded by the court in connection
with dispute resolution.
COVENANTS
13. In consideration of the actions that will be performed and the
payments that will be made by Chugach under the terms of this Agreement, the
United States covenants not to sue Chugach for contribution pursuant to CERCLA
ss.ss. 107(a) or 113(f), 42 U.S.C. ss.ss. 9807(a) or 9613(f), state statutory or
common law, or
FUNDING AGREEMENT - September 23, 1992
PAGE 9
<PAGE>
any other provision of law, with respect to the costs of conducting the RI/FS,
together with any other matter covered by this Agreement. This covenant:
a. Applies only to suits for contribution relating to
the costs of conducting the RI/FS, and does not restrict any
other action by the United states, including, but not
limited to:
(1) An action pursuant to CERCLA ss. 107(a),
42 U.S.C. ss. 9607(a), to recover costs expended by the
Hazardous Substances Superfund or to receive sums for
damages for injury to natural resources;
(2) An action pursuant to CERCLA ss. 107(a) or
113(f), 42 U.S.C. ss.ss. 9607(a), 9613(f), state statutory
or common law, or any other provision of law, for
contribution relating to matters not covered by this
Agreement;
b. Is conditioned upon the complete and satisfactory
performance by Chugach of its obligations under this
Agreement and the Consent Order; and
c. Extends only to Chugach and not to any other
person.
14. In consideration of the payments that will be made by the United
States on behalf of the Settling Federal Agencies under the terms of this
Agreement, Chugach covenants not to sue the United States or any Settling
Federal Agency for contribution pursuant to CERCLA ss.ss. 107(a) or 113(f), 42
U.S.C. ss.ss. 9607(a) or 9613(f), state statutory or common law, or any other
provision of law, with respect to the costs of conducting the RI/FS, together
with any other matter covered by this Agreement. This covenant:
a. Applies only to suits for contribution relating to the
costs of conducting the RI/FS, and does not restrict any other action
by Chugach, including, but not limited, to an action pursuant to CERCLA
ss.ss. 107(a) or 113(f), 42 U.S.C.
FUNDING AGREEMENT - September 23, 1992
PAGE 10
<PAGE>
ss.ss. 9607(a) or 9613(f), state statutory or common law, or any other
provision of law for contribution relating to matters not covered by
this Agreement;
b. Is conditioned upon the complete and satisfactory
performance by the United States and the Settling Federal
Agencies of their obligations under this Agreement.
c. Extends only to the United States and the Settling
Federal Agencies and not to any other person.
ABSENCE OF ALLOCATION
15. Nothing in this Agreement shall be construed as an indication that
the parties hereto have agreed to an allocation between themselves, either under
CERCLA ss. 113, 42 U.S.C. ss. 9613 or otherwise, of any costs of response with
respect to the Site other than those of the RI/FS required pursuant to the
Consent Order. Each party to this Agreement expressly acknowledges that the
commitments undertaken pursuant to this Agreement and the Consent Order are
without prejudice to any position that any party to this Agreement may take in
the course of further discussions regarding contribution, and without admission
that any particular allocation is appropriate.
16. Nothing in this Agreement shall be construed as an indication that
the parties hereto accept or agree that any particular allocation between
themselves and any other person or entity is appropriate, either under CERCLA
ss. 113, 42 U.S.C. ss. 9613 or otherwise, as to any matter, obligation or
liability, including without limitation, EPA's past costs, costs of conducting
the RI/FS and other costs of response incurred at the Site.
FUNDING AGREEMENT - September 23, 1992
PAGE 11
<PAGE>
DESIGNATED PROJECT COORDINATORS
17. All reports, plans, approvals, disapprovals, and other
written communication required or permitted by this Agreement
shall be sent to each party's designated Project Coordinator. The
Project Coordinators are:
For the Settling Federal Agencies:
Bruce Noble, Environmental Specialist
Defense Reutilization and Marketing Service (DRMS-SHP)
Federal Center
74 North Washington
Battle Creek, Michigan 49017-3091
(616) 961-7412
FAX: (616) 961-5841
For Chugach:
Carol Johnson, Esq.
General Counsel
Chugach Electric Association, Inc.
P.O. Box 196300
Anchorage, Alaska 99519-6300
(907) 762-4790
FAX: (907) 762-4688
COMMUNITY RELATIONS
18. The Settling Federal Agencies may participate fully in any
community relations activities required by the Consent Order. Chugach shall
provide reasonable prior written notice to the Project Coordinator for the
Settling Federal Agencies of all such community relations activities.
19. Chugach shall provide advance drafts of any press
release or other public statement relating to the RI/FS to the Project
Coordinator for the Settling Federal Agencies, together with a reasonable
opportunity to supply comments before the statement is released. The Settling
Federal Agencies shall be
FUNDING AGREEMENT - September 23, 1992
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<PAGE>
offered the opportunity to join in the final draft of the statement, and
otherwise shall retain their rights to offer separate contemporaneous
statements.
MISCELLANEOUS
20. This Agreement applies to and is binding upon the United States and
Chugach, together with their heirs, successors, and assigns. changes in
ownership or corporate status of Chugach, including but not limited to, any
transfer of assets or real or personal property shall not alter Chugach's
responsibilities under this Agreement.
21. The undersigned representatives of each party certify that they are
fully authorized by the party or parties they represent to enter into the terms
and conditions of this Agreement, and to bind the parties they represent to
those terms.
22. This Agreement shall not be modified except by
appropriate written instrument executed by the United States and
Chugach.
23. This Agreement does not affect the rights of the United
States or Chugach against any person or entity that is not a
party to this Agreement or bound by its terms.
24. This Agreement does not relieve Chugach of any
obligation it may have to obtain and comply with any federal, state, or local
permit or other form of permission required to conduct the work required by the
Consent order or by this Agreement.
FUNDING AGREEMENT - September 23, 1992
PAGE 13
<PAGE>
25. Chugach shall not, by any manner or method, take, acquire, accept,
or show profit from the United States or any agency thereof from or by virtue of
payments made pursuant to this Agreement.
EFFECTIVE DATE
26. This Agreement shall be effective on, and not before, the date of
execution by the United States. Upon execution by the United States, this
Agreement shall bind the parties hereto retroactively as to all amounts to be
reimbursed pursuant to Paragraphs 1 through 4.
DATED: 1/11/93 UNITED STATES OF AMERICA
VICKI A. O'MEARA
Acting Assistant Attorney General
/s/ Michael D. Rowe
By: MICHAEL D. ROWE, Attorney
United States Department of Justice
Environment & Natural Resources
Division
DATED: 9/24/92 CHUGACH ELECTRIC ASSOCIATION, INC.
/s/ David L. Highers
By: DAVID L. HIGHERS
General Manager
FUNDING AGREEMENT - September 23, 1992
PAGE 14
<PAGE>
APPENDIX 3 TO PARTIAL CONSENT DECREE
SECOND FUNDING AGREEMENT FOR THE
STANDARD STEEL SUPERFUND SITE:
SCRAP REMOVAL CONTRACTING AND ALLOCATION
This Second Funding Agreement is made by and among the ALASKA
RAILROAD CORPORATION, CHUGACH ELECTRIC ASSOCIATION, INC., WESTINGHOUSE ELECTRIC
CORPORATION, MONTGOMERY WARD & CO., INC., J.C. PENNEY COMPANY, INC.,
BRIDGESTONE/FIRESTONE, INC., THE UNITED STATES OF AMERICA acting on behalf of
the Department of Transportation (including the Federal Railroad Administration)
and the Department of Defense (including the Defense Logistics Agency, the
Defense Reutilization and Marketing Service, and the Army/Air Force Exchange
Service), WOODWARD-CLYDE CONSULTANTS, and CECON CORPORATION for the purpose of
providing the funding necessary to conduct certain scrap removal operations
required in connection with an RI/FS being conducted at the Standard Steel and
Metals Superfund Site, and for the additional purpose of making payment to
certain parties conducting work at the same Site.
WHEREAS, Chugach entered into an Administrative Order on
Consent with the United States Environmental Protection Agency ("EPA") to
conduct an RI/FS for the Site on or about September 23,
1992;
WHEREAS, Chugach has retained Woodward-Clyde Consultants to
conduct the RI/FS pursuant to the Administrative Order on Consent and certain
EPA approved work plans;
WHEREAS, the United States, acting on behalf of certain
Federal Agencies, has agreed to reimburse Chugach for 75% of the
1
<PAGE>
cost of conducting the RI/FS, expressly excluding scrap removal costs, pursuant
to a funding agreement made effective on or about January 11, 1993;
WHEREAS, the United States and Chugach have continued to
negotiate with additional parties regarding allocation of both EPA past response
costs and RI/FS costs at the Site;
WHEREAS, the United States, Chugach, and certain additional
parties have reached a settlement regarding those matters, which will be
recorded in a Consent Decree in connection with the case styled United States v.
Alaska Railroad Corn., No.
A91-589-CIV (D. Alaska);
WHEREAS, removal of a substantial volume of scrap metal and
debris has been required to gain access to the Site for RI/FS purposes;
WHEREAS, Woodward-Clyde, CEcon, and ARRC have performed or
have retained others to perform the necessary Scrap Removal in furtherance of
the RI/FS; and
WHEREAS, the parties expect Scrap Removal to be complete prior
to entry of the Consent Decree, and wish to avoid undue delay in providing
compensation for satisfactorily completed work;
NOW, THEREFORE, in consideration of the mutual promises and
conditions contained herein, and without admission by any Party of any fact or
legal conclusion, the parties hereby agree:
2
<PAGE>
DEFINITIONS
1. "Agreement" shall mean this Second Funding
Agreement.
2. "CERCLA" shall mean the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C.
ss.ss. 9601-75. Terms not specifically defined in this Agreement that are
defined in CERCLA or in implementing regulations promulgated thereunder shall
have the meaning assigned to them in the statute or regulations.
3. "Consent Decree" shall mean that particular Partial Consent
Decree which the Settling Parties have executed simultaneously with this
Agreement, and which the United States expects to lodge and subject to public
comment pursuant to CERCLA ss. 122(d)(2), 42 U.S.C. ss. 9622(d)(2), in
connection with the case styled United States v. Alaska Railroad Corp., No.
A91-589-CIV (D. Alaska).
4. "Contractors" shall mean Woodward-Clyde and CEcon. However,
nothing in this Agreement shall be construed to impose any obligation on any
Party not specifically set forth in the Agreement, or to imply the existence of
any existing relationship between any Contractor and any other Party, whether
contractual, quasi-contractual, or otherwise.
5. "Effective Date" shall mean the date specified in
Paragraphs 52 and 53 of this Agreement.
6. "Interest" shall mean interest at the rate specified
for interest on investments of the Hazardous Substances Superfund,
3
<PAGE>
in accordance with Section 107(a) of CERCLA, 42 U.S.C. ss. 9607(a),
compounded on an annual basis.
7. "Party" means each entity executing this Agreement
and subject to its terms.
8. "RI/FS" shall mean the Remedial Investigation/ Feasibility
Study being conducted at the Site. The Parties agree that RI/FS tasks include
Scrap Removal necessary to obtain access to the underlying ground for sampling
and other appropriate purposes.
Chugach and the United States agree that the exclusion of
scrap removal costs from the definition of RI/FS in the funding agreement
already entered between them shall remain in place for purposes of that
agreement only, and that the present definition shall supersede it for all other
purposes.
9. "Scrap Removal" shall mean the elimination of scrap metal
and other debris from the Site and surrounding areas as required to gain access
for purposes of conducting the RI/FS, including without limitation: securing
rights to dispose of scrap metal and debris; sampling the same scrap metal and
debris for contamination; analysis of those samples, including appropriate
quality assurance and quality control tasks; cleaning, sorting, and loading
scrap and debris; Settling PRP oversight tasks associated with scrap and debris
handling; and transportation and disposal of scrap and debris.
10. "Scrap Removal Cost" shall mean the sum of the
amounts due as set forth in Addenda 1, 2, and 3.
4
<PAGE>
11. "Settling Parties" shall mean the Settling PRPs
together with the United States.
12. "Settling PRPS" shall mean the Alaska Railroad
Corporation, Chugach Electric Association, Inc., Westinghouse
Electric Corporation, Montgomery Ward & Co., Inc., J.C. Penney
Company, Inc., and Bridgestone/Firestone, Inc.
13. "Site" shall mean the Standard Steel and Metals
Superfund Site, 2400 Railroad Avenue, Anchorage, Alaska 99501.
14. "Unattributed Share" shall mean an amount equal to
the difference between the sum of the shares assigned to each Party
pursuant to Paragraph 24 and the Scrap Removal Cost.
PARTIES
15. "Alaska Railroad Corporation" ("ARRC") is a public
corporation of the State of Alaska created by Alaska Statute 42.40
with its principal place of business in Anchorage, Alaska.
16. "Chugach Electric Association, Inc." ("Chugach") is
an Alaska electric cooperative corporation with its principal place
of business in Anchorage, Alaska.
17. "Bridgestone/Firestone, Inc." ("Bridgestone/
Firestone") is an Ohio corporation with its principal place of business in
Nashville, Tennessee, which is qualified to do business, and is doing business,
in the State of Alaska.
18. "J. C. Penney Company, Inc." ("J.C. Penney") is a
Delaware corporation with its principal place of business in
5
<PAGE>
Plano, Texas, which is qualified to do business, and is doing business, in the
State of Alaska.
19. "Montgomery Ward & Co., Inc." ("Montgomery Ward") is an
Illinois corporation with its principal place of business in Chicago, Illinois,
which is qualified to do business, and is doing business, in the State of
Alaska.
20. "Westinghouse Electric Corporation" ("Westinghouse")
is a Pennsylvania corporation with its principal place of business in
Pittsburgh, Pennsylvania, which is qualified to do business, and is doing
business, in the State of Alaska.
21. "Woodward-Clyde Consultants" ("Woodward-Clyde") is
a Delaware corporation with its principal place of business in Denver,
Colorado, which is qualified to do business, and is doing business, in the State
of Alaska.
22. "CEcon Corporation" ("CEcon") is a private
Washington State Corporation with its principal place of business in
Tacoma, Washington, which is qualified to do business, and is doing business, in
the State of Alaska.
23. "United States" is the United States of America, and its
agencies, departments, and instrumentalities, including without limitation the
Department of Transportation (including the Federal Railroad Administration) and
the Department of Defense (including the Defense Logistics Agency, Defense
Reutilization and Marketing Service, and the Army/Air Force Exchange Service).
PAYMENTS BY SETTLING PARTIES (CONTRIBUTION)
6
<PAGE>
24. The Settling Parties agree to allocate their alleged
liability for the Scrap Removal Cost as follows:
ARRC $ 69,114.21
Chugach 82,522.06
Bridgestone/Firestone 3,194.81
J.C. Penney 11,277.70
Montgomery Ward 10,510.94
Westinghouse 31,117.49
United States 472,626.08
Unattributed Share 180,858.45
Scrap Removal Cost $861,221.74
25. ARRC has provided services and payments to others relating
to Scrap Removal which shall be applied as an offset against payment of the
share assigned to it in Paragraph 24, as provided in Addendum 3.
26. Not later than 30 days after the Effective Date provided
in Paragraph 52, each Settling PRP shall deliver payment of the amount assigned
to it in Paragraph 24 to ARRC by cashier's check or wire transfer pursuant to
instructions ARRC will timely provide to each Settling Party in accordance with
Paragraph 46. The instructions shall allow for payment by cashier's check or
wire transfer. Sums paid by the Settling PRPs pursuant to this Paragraph shall
be held in trust by ARRC and handled and disbursed in accordance with Paragraphs
31 through 35.
7
<PAGE>
27. Not later than 90 days after the Effective Date provided
in Paragraph 53, the United States shall deliver payment of the amount assigned
to it in Paragraph 24, together with an amount equal to the Unattributed Share,
to ARRC pursuant to instructions ARRC will timely provide to the United States
in accordance with Paragraph 46. The payment shall consist of a check drawn on
the United States Treasury in the amount of $618,484.53, and a wire transfer
drawn on the funds of the Army/Air Force Exchange Service in the amount of
$35,000.00. Sums paid by the United States pursuant to this Paragraph shall be
held in trust by ARRC and shall be handled and disbursed in accordance with
Paragraphs 31 through 35.
28. The United States shall be entitled to a "credit" for
payment of the Unattributed Share, as defined in Paragraph 3(d) of the Consent
Decree and as provided for in Paragraph 5(e) thereof.
29. In the event that any Settling Party fails to make timely
payment in full as required in Paragraphs 26 and 27, any amount outstanding
shall bear Interest from the date of the default.
30. Payments by the United States are subject to the
availability of appropriated funds. No provision of this Agreement
8
<PAGE>
shall be interpreted as or constitute a commitment or requirement that the
United States obligate or pay funds in contravention of the Anti-Deficiency Act,
31 U.S.C. ss. 1341.
HANDLING & DISBURSEMENT OF PROCEEDS
31. ARRC shall accept funds paid to it pursuant to Paragraphs
26 and 27 in trust, shall maintain those funds in a segregated account
appropriate for funds held in trust, and shall use or disburse those funds only
as instructed in this Agreement.
32. On or before March 23, 1994 ARRC shall disburse funds
received to and including that date, not to exceed $100,000, to CEcon.
Thereafter, ARRC shall disburse funds in accordance with Paragraphs 33 through
35.
33. Not more than 10 days after the time allowed for payment
by the Settling PRPs in accordance with Paragraph 26, ARRC shall disburse the
proceeds of such payments in accordance with the instructions provided in
Paragraph 34. Not more than 10 days after the time allowed for payment by the
United States in accordance with Paragraph 27, ARRC shall disburse the proceeds
of such payment in accordance with the instructions provided in Paragraph 34.
34. Disbursements by ARRC pursuant to Paragraph 33 shall
be applied pro rata against the amounts due as set forth in Addenda
9
<PAGE>
1, 2, and 3. Late payments shall be similarly applied, inclusive
of any Interest that may have accrued.
35. Not later than 30 days after the final disbursement of
proceeds, ARRC shall provide a written accounting to each Party documenting
receipts and disbursements under this Agreement.
a. Any surplus funds arising from overpayment by
any Settling PRP or the United States shall be refunded to that Party within the
same 30 day period.
b. Any surplus arising from any other source shall
be refunded on a pro rata basis to the Settling PRPs and the United
States within the same 30 day period. The pro rata refund to the
United States shall include an amount calculated on the basis of the
Unattributed Share.
WARRANTIES
36. Each Contractor and ARRC warrants to each Settling
PRP and the United States:
a. that it has and will perform Scrap Removal
operations in a good and workmanlike manner, with the skill and care ordinarily
exercised by members of the applicable Party's industry or profession practicing
under similar circumstances, and
10
<PAGE>
in accordance with generally accepted standards in the applicable
Party's field;
b. that it has conducted its Scrap Removal
operations in accordance with all applicable Federal, state, and
local laws and regulations;
c. that it has conducted its Scrap Removal
operations in accordance with any applicable provisions of scrap
removal workplan(s) approved by EPA for the Site;
d. that subcontractors, suppliers, materialmen,
and any other persons or entities retained by it in connection with Scrap
Removal operations have been paid for services rendered, or will be paid
promptly upon presentation of a proper invoice in the ordinary course of
business;
e. that no claims have been asserted or
threatened against it by such persons with regard to services performed as
part of Scrap Removal;
f. that it has resolved, or will resolve at its
own expense, any claims by others that may arise with regard to Scrap Removal,
including, without limitation, claims to ownership of scrap metal, or debris;
and
g. that costs invoiced by way of its Addendum
are those for Scrap Removal only, and not for any other work or task.
11
<PAGE>
37. In the event that any of the above warranties is breached
by any Contractor or ARRC, the Party in breach shall take whatever steps are
required to remedy that breach at that Party's sole expense, and shall further
hold harmless, indemnify, and defend the Settling PRPs and the United States
with regard to any claim, expense, damage, or penalty made or incurred as a
result of the breach.
RELEASE OF CLAIMS FOR SCRAP REMOVAL
38. Each Contractor and ARRC hereby release and forever
discharge any and all persons or entities, including, without limitation, the
Settling Parties, from and against any and all claims, obligations, causes of
action, suits, debts, costs, expenses, damages, or demands whatsoever, known or
unknown, vested or contingent, at law or in equity which each Contractor and
ARRC ever had, now has, or may acquire against any or all such persons or
entities, separately or collectively, arising out of, relating to, or otherwise
concerning Scrap Removal or the costs thereof.
39. The releases set forth in Paragraph 38 are conditioned
upon payment pursuant to Paragraph 26, and shall have no force or effect with
regard to any Settling PRP that fails to make payment in accordance with that
Paragraph.
12
<PAGE>
40. The releases set forth in Paragraph 38 are similarly
conditioned upon payment by the United States pursuant to Paragraph 27. The
releases shall have no force or effect with regard to the United States if it
fails to make payment in accordance with that Paragraph.
COVENANTS REGARDING CONTRIBUTION
41. In consideration of the actions performed and payments
made pursuant to the terms of this Agreement, the United States covenants not to
sue any of the Settling PRPs for contribution pursuant to CERCLA ss.ss. 107(a)
or 113(f), 42 U.S.C. ss.ss. 9607(a) or 9613(f), state statutory or common law,
or any other provision of law, with respect to Scrap Removal. This covenant:
a. Applies only to suits for contribution relating to
Scrap Removal, and does not restrict any other
action by the United States, including, but not
limited to:
1. An action pursuant to CERCLA ss. 107(a), 42
U.S.C. ss. 9607(a) , to recover costs expended
by the Hazardous Substances Superfund or to
receive sums for damages for injury to natural
resources;
2. An action pursuant to CERCLA ss.ss. 107(a) or
113(f), 42 U.S.C. ss. 9607(a), 9613(f), state
statutory or common law, or any other
provision of law, seeking contribution for any
cost other than that of Scrap Removal as
defined in this Agreement;
13
<PAGE>
b. Is conditioned upon complete and satisfactory
performance by each Settling PRP of its obligations
under this Agreement; and
c. Extends only to each Settling PRP, and not to any
other person or entity.
42. In consideration of the actions performed and payments
made pursuant to the terms of this Agreement, each Settling PRP covenants not to
sue the United States, and further covenants not to sue any other Settling PRP,
for contribution pursuant to CERCLA ss.ss. 107(a) or 113(f), 42 U.S.C. ss.ss.
9607(a) or 9613(f), state statutory or common law, or any other provision of
law, with respect to Scrap Removal. This covenant:
a. Applies only to suits for contribution relating to
Scrap Removal, and does not restrict any other
action by any Settling PRP, including, but not
limited to an action pursuant to CERCLAss.ss. 107(a)
or 113(f), 42 U.S.C.ss. 9607(a), 9613(f), state
statutory or common law, or any other provision of
law, seeking contribution for any cost other than
that of Scrap Removal as defined in this Agreement;
b. Is conditioned upon complete and satisfactory
performance by the United States and by each
Settling PRP of its obligations under this
Agreement; and
c. Extends only to the United States and to each other
Settling PRP, and not to any other person or
entity.
ASSIGNMENT OF RIGHTS
14
<PAGE>
43. Each Settling Party hereby assigns any claims for
contribution it may have in connection with Scrap Removal against
Scott-Douglas Industries, Inc., Pak-Trak Industries, Inc., or Douglas P. Hand to
ARRC. Claims not specifically assigned in this Paragraph are reserved by each
Settling Party.
CONSTRUCTION OF TERMS
44. Nothing in this Agreement shall be construed as an
indication that the Settling Parties have agreed to an allocation among
themselves, either under CERCLA ss. 113, 42 U.S.C. ss. 9613, or otherwise, of
any costs of response with respect to the Site other than costs of scrap
Removal. Each Settling Party expressly acknowledges that the commitments
undertaken pursuant to this Agreement are without prejudice to any position that
any Party may take in the course of further discussions or litigation regarding
contribution for other costs of response, and without admission that any
particular allocation is appropriate.
45. Nothing in this Agreement shall be construed as an
indication that the Settling Parties accept or agree that any particular
allocation between themselves and any other person or entity is appropriate,
either under CERCLA ss. 113, 42 U.S.C. ss. 9613 or otherwise, as to any matter,
obligation, or liability, other than costs of Scrap Removal.
15
<PAGE>
NOTICES AND DOCUMENTATION
46. All written communication required or permitted by this
Agreement shall be directed to the individuals and the addresses specified
below, or to such other individuals as the parties may hereafter designate in
writing.
16
<PAGE>
For ARRC: For Bridgestone/Firestone:
Phyllis Johnson Jim Vines, Staff Attorney
Vice President & Bridgestone/Firestone, Inc.
General Counsel 50 Century Boulevard
Alaska Railroad Corp. Nashville, TN 37214
P.O. Box 107500 (615) 872-1498
Anchorage, AK 99510-7500 (615) 872-1490
(907) 265-2461
(907) 265-2443 Telefax Stephen M. Ellis
Delaney, Wiles, Hayes, Reitman
& Brubaker
1007 West Third Ave., Suite 400
Anchorage, AK 99510
(907) 279-3581
(907) 277-1331 Telefax
For Chugach: For Woodward-Clyde:
Carol Johnson, Esq. Phyllis A. Brunner
General Counsel Vice President
Chugach Electric Assn. Seattle Operation Mgr.
P.O. Box 196300 Woodward-Clyde Consultants
Anchorage, AK 99519-6300 3440 Bank of California Center
(907) 762-4790 900 4th Avenue
(907) 762-4688 Telefax Seattle, WA 98164
(206) 343-7933
R. Paul Beveridge (206) 343-0513
Heller, Ehrman, White &
McAuliffe
6100 Columbia Center
701 Fifth Avenue
Seattle, WA 98104-7098
(206) 447-0900
(206) 447-0849 Telefax
For Westinghouse: For CEcon:
Stephen T. Wardzinski Charles Engstrom
Chief Counsel, Environmental CEcon Corporation
Affairs P.O. Box 1514
Westinghouse Electric Corp. Tacoma, WA 98401
Westinghouse Building (206) 272-8851
17
<PAGE>
Gateway Center (206) 272-1334 Telefax
Pittsburgh, PA 15222
(412) 642-5899
(412) 642-3923 Telefax
(Cont'd.)
Joseph L. Reece
Davis Wright Tremaine
550 W. 7th Avenue, Suite 1450
Anchorage, AK 99501
(907) 257-5300
(907) 257-5399
For Montgomery Ward: For J.C. Penney:
Phillip D. Delk, Esq. J.C. Penney, Inc.
Vice President & Deputy Corporate Risk Management
General. Counsel 2000 Oxford Drive, Second Floor
Corporate Offices Bethel Park, PA 15102
Montgomery Ward & Co., Inc. Attn: Mary Ann Snyder
535 West Chicago Ave.
Suite 3N George Lyle, Esq.
Chicago, IL 60610 Guess & Rudd
510 L Street, Suite 700
George Lyle, Esq. Anchorage, AK 99501
Guess & Rudd (907) 276-5121
510 L Street, Suite 700 (907) 279-8354 Telefax
Anchorage, AK 99501
(907) 276-5121
(907) 279-8354 Telefax
For the United States:
Bruce Noble
DRMS-SHO, Federal Center
74 North Washington
Battle Creek, MI 49017-3091
(616) 961-7412
(616) 961-5841 Telefax
Michael D. Rowe
U.S. Department of Justice
Environment & Natural Resources
Division
18
<PAGE>
P.O. Box 23986
Washington, DC 20036-3986
(202) 514-3144
(202) 616-2426 Telefax
19
<PAGE>
MISCELLANEOUS
47. This Agreement applies to and is binding upon the United
States, each Settling PRP, and each Contractor, as defined, together with their
successors and assigns. Changes in ownership or corporate status, including but
not limited to any transfer of assets, or real or personal property, shall not
alter the responsibility of any Settling PRP or Contractor subject to this
Agreement.
48. The undersigned representatives of each Party certify that
they are fully authorized by the Party or Parties each of them represents to
enter into the terms and conditions of this Agreement, and to bind those parties
to those terms and conditions.
49. This Agreement, together with pertinent provisions
of the Consent Decree, represent the entire understanding of the Parties
with regard to Scrap Removal.
50. This Agreement shall not be modified except by
appropriate written instrument executed by each Party.
51. This Agreement may be executed in a number of
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
EFFECTIVE DATE
20
<PAGE>
52. This Agreement shall be effective between and among
the Settling PRPs and the Contractors on March 18, 1994.
53. This Agreement shall be effective between and among the
United States, the Settling PRPS, and the Contractors on, and not before, the
date of execution by the Assistant Attorney General for Environment and Natural
Resources. The United States shall promptly serve a notice on each Party by
tele-facsimile upon such execution.
54. No release, covenant, or warranty under this Agreement,
whether given or received, shall apply with regard to any party until the
Effective Date applicable to that Party as provided in Paragraphs 52 and 53.
FOR THE
UNITED STATES OF AMERICA
Date: 3-21-94 /s/ Lois J. Schiffer
LOIS J. SCHIFFER
Acting Assistant Attorney
General
Environment and Natural
Resources Division
U.S. Department of Justice
Washington, D.C. 20530
21
<PAGE>
/s/ Michael D. Rowe
MICHAEL D. ROWE, Attorney
Environmental Defense Section
Environment and Natural
Resources Division
P.O. Box 23986
Washington, D.C. 20026
(202) 514-3144
22
<PAGE>
ROBERT C. BUNDY
United States Attorney for the
District of Alaska
Date: ______________ _______________________________
MICKALE C. CARTER
Assistant United States
Attorney
No. 9, Federal Building and
U.S. Courthouse
701 C Street
Anchorage, Alaska 99513
23
<PAGE>
FOR THE SETTLING DEFENDANTS:
ALASKA RAILROAD CORPORATION
Date 3/22/94 /s/ Robert D. Hatfield, Jr.
ROBERT S. HATFIELD, JR.
President & Chief Executive
Officer
24
<PAGE>
CHUGACH ELECTRIC ASSOCIATION, INC.
Date: 3/17/94 /s/ David L. Highers
DAVID L. HIGHERS
General Manager
Chugach Electric Association,
Inc.
25
<PAGE>
WESTINGHOUSE ELECTRIC CORPORATION
Date: 3-28-94 /s/ Samuel R. Pitts
SAMUEL R. PITTS
Vice President
26
<PAGE>
MONTGOMERY WARD & CO., INC.
Date: March 27,1994 /s/ Phillip D. Delk
[Name and title] vice president
27
<PAGE>
J. C. PENNEY COMPANY, INC.
Date: March 28, 1994 /s/ Carl B. Seaholm
Carl B. Seaholm
Manager
Corporate Risk Management
28
<PAGE>
BRIDGESTONE/FIRESTONE, INC.
Date: 4-25-94 /s/ James K. Vines
JAMES K. VINES
GENERAL COUNSEL - ENVIRONMENTAL
29
<PAGE>
WOODWARD CLYDE CONSULTANTS
Date: March 21,1994 /s/ Phyllis A. Brunner
PHYLLIS A. BRUNNER
Vice President
30
<PAGE>
CECON CORPORATION
Date: 3/21/94 /s/ Charles Engstrom
CHARLES ENGSTROM
President
31
<PAGE>
ADDENDUM 1
WOODWARD-CLYDE CONSULTANTS
I. Expenses:
A. Woodward-Clyde invoices:
#1356 dtd 09/17/96 $ 31,236.43
#3336 dtd 10/08/93 34,609.41
#6730 dtd 11/12/93 19,714.58
#10283 dtd 12/10/93 9,398.52
#13555 dtd 01/05/94 9,101.38
Subtotal invoices $104,060.32
B. Additional work:
Landfill debris oversight
(Firm lump sum price) $ 14,860.00
C. Total expenses $115,920.32
II. Receipts against expenses: $ 00.00
III. Amount due: $118,920.32
Addendum 2
CEcon Corporation
I. Expenses:
A. Cecon invoices:
#1820 dtd 09/04/93 $240,981.95
#1828 dtd 10/01/93 149,452.03
#1847 dtd 10/27/93 155,799.63
#1848 dtd 10/27/93 106,343.83
#1849 dtd 10/30/93 63,680.94
#1850 dtd 12/02/93 107,425.37
-----------
Subtotal Cecon invoices $823,683.75
B. Additional work:
Proposal dtd 02/25/94 for
removal of debris pile
(Firm lump sum price) $ 90,390.00
----------
C. Total Cecon expenses: $914,073.75
II. Receipts against expenses:
(dates are of cover letters)
11/03/93 $10,373.90
11/22/93 71,699.40
11/22/93 2,104.80
11/22/93 1,062.00
11/30/93 1,100.00
12/30/93 36,814.80
01/05/94 50,887.20
01/05/94 3,090.60
01/05/94 1,300.00
01/19/94 30,445.20
01/31/94 35,354.00 $244,231.90
--------- -----------
III. Amount due: $669,841.85
<PAGE>
Addendum 3
Alaska Railroad Corporation
I. Expenses:
A. Internal labor $19,456.12
B. Landfill fees 1,315.45
C. Shipment of 129 railcars
from Anch-Whittier 20,382.00
D. Shipment of 129 railcars
from Whittier-Seattle -0-
E. Switch charges in Seattle
(129 railcars) 25,800.00
F. APC tie downs 8,000.00
G. Shipment of 25 APC flat-
cars from Anch-Whittier 3,950.00
H. Shipment of 25 APC flat-
cars from Whittier-Seattle -0-
I. Switch charges in Seattle
(25 APC flatcars) 5,000.00
J. Bank fees for trust account 120.00
Total ARRC expenses $84,023.57
II. Revenues
A. Net proceeds of sale of
remaining APCs to Purdy Co. $ 5,939.00
B. Remaining local scrap sales 5,625.00
---------
Total revenues $11,564.00
III. Amount due $72,459.57
<PAGE>
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<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-1-1996
<PERIOD-END> SEP-30-1996
<CASH> 4,048,580
<SECURITIES> 0
<RECEIVABLES> 14,154,700
<ALLOWANCES> (543,745)
<INVENTORY> 20,246,087
<CURRENT-ASSETS> 39,881,127
<PP&E> 625,353,990
<DEPRECIATION> (210,880,665)
<TOTAL-ASSETS> 476,465,571
<CURRENT-LIABILITIES> 30,493,663
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0
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<SALES> $97,529,513
<TOTAL-REVENUES> $97,529,513
<CGS> 0
<TOTAL-COSTS> 73,763,680
<OTHER-EXPENSES> 0
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<INTEREST-EXPENSE> 19,171,108
<INCOME-PRETAX> 5,310,631
<INCOME-TAX> 0
<INCOME-CONTINUING> 5,310,631
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,310,631
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
