Unsafe sewage sludge or beneficial biosolids?: Liability, planning, and management
issues regarding the land application of sewage treatment residuals
Boston College Environmental Affairs Law Review, Summer 1999 by Goldfarb,
William, Krogmann, Uta
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Commentators have identified fear of liability as a major deterrent to the widespread land application of sewage sludge.
Liability issues regarding land application include not only legal liability, but also market liability as a result of negative
public perceptions of the land application of sewage sludge. Under current law, municipal sewage treatment facilities,
landowners, farmers, and even lenders are potentially liable for risks arising from sewage sludge application, unless
someone else assumes the risk through a clear and legally enforceable mechanism. This article introduces this
complex, evolving, and contentious environmental issue. It investigates the various siting and toxic tort liability issues
associated with the land application of sewage sludge, and explores some of the risk-sharing mechanisms developed to
minimize the liabilities associated with the application of sewage sludge to farmland. It concludes with a recommendation
for a public indemnification fund to compensate for losses caused by land application of sewage sludge.
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In order to comply with its common law duty to warn of any dangerous propensities, the manufacturer must furnish a
warning on the label that is sufficient to convey to those who might use the product notice of any inherent dangers in
the product and of the possible consequences of the use or even misuse thereof.413 A product may be manufactured
and designed perfectly, but may still be defective under the common law if it contains a hidden danger. Products with
such hidden dangers are defective unless they are accompanied by a warning that includes "the directions,
communications and information essential to make the use of the product safe."414 This might cause a problem for
sewage sludge manufacturers relying solely on Part 503 requirements. Recall that for sewage sludge and sewage
sludge derived products meeting the EQ standards, no labeling or user information is required.415 There has been a
great deal of criticism regarding the lack of information given to consumers about sewage sludge product quality.416
However, what is now merely criticism could in the future form the basis of a lawsuit. The common law actions against
fertilizer manufacturers described above suggest that sewage sludge product manufacturers relying on Part 503
compliance may also be open to common law property damage, personal injury, and failure to warn claims based on
product liability.417
B. Statutory Liability
1. CERCLA
Common law strict liability has been extensively supplemented, or even supplanted, by strict liability imposed under the
terms of environmental statutes. At the federal level, the most significant source of potential strict, joint, and several
liability is CERCLA.418 Under CERCLA, generators, transporters, and disposers of hazardous substances, including
those who arrange for the disposal of hazardous substances, such as POTW operators, are strictly, jointly, and
severally liable for the costs of cleanup relating to releases or threatened releases of such substances.419
At first glance, it appears that Congress and EPA have provided safe harbors in CERCLA directly applicable to the land
application of sewage sludge. First, section 101(22) of CERCLA specifically defines "release" to exclude the "normal
application of fertilizer."420 Second, a party is also protected when a release of a hazardous substance is federally
authorized, such as pursuant to a CWA permit.421 Lastly, in the preamble to the Part 503 Rule, EPA states that if the
placement of the sewage sludge on land is considered to be either (1) the normal application of fertilizer under
CERCLA, or (2) a "federally permitted release," then CERCLA liability would not result.422 However, CERCLA's fertilizer
and federally permitted release exemptions, and EPA's brief discussion about the exemptions' applicability to sewage
sludge land application, raise as many questions as they answer .423
Superficially, it appears that the land application of sewage sludge falls under the fertilizer exemption to CERCLA. In
addition, to the extent that sewage sludge is applied in a normal manner and within normal concentrations, that is, if
land application is a "federally permitted release," that placement would not constitute a "release" that would give rise to
CERCLA liability.424 A release in compliance with a sewage sludge permit issued by EPA (or an EPA-authorized state)
would thus qualify as a "federally permitted release."425 However, if any of the requirements contained in a Part 503
permit were violated, it would appear that an associated release would not be a "federally permitted release," and
CERCLA liability would accrue. In Fallowfield Development Corp. v. Strunk, the Pennsylvania Department of
Environmental Resources issued a permit to defendant Strunk, allowing him to land-apply sewage sludge as fertilizer to
cornfields.426
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Unfortunately, the sewage sludge contained lead, trichloroethane, trichloroethylene, chloroform, and other hazardous
substances, presumably in violation of the permit.427 Ultimately, the site was included on EPA's National Priority List
and the purchasers of the property sued Strunk under several theories, including CERCLA.428 The court summarily
rejected Strunk's argument that his application of sewage sludge was a protected release under CERCLA, holding that
"uncontradicted evidence support a finding that the sludge applied by the Strunk's [sic] was not 'normal' because it was
contaminated. Accordingly, the exemption for normal application of fertilizer is inapplicable."429
If sewage sludge is applied in violation of a permit, a farmer could be liable under CERCLA. Moreover, a POTW's
CERCLA fate may be entirely out of its control, and may depend on the ability of its contractors and/or farmers and
state enforcement officials to ensure that 100% compliance is maintained. If a POTW's sewage sludge contractors
disregard accepted management practices, then CERCLA liability may rest with the POTW.
Furthermore, neither CERCLA's language nor its legislative history indicates whether the exclusion of the initial
application of a fertilizer (first release) extends to any later contamination of groundwater caused by chemicals in the
sewage sludge.430 Thus, despite EPA's assertions to the contrary, CERCLA liability may exist in certain circumstances.
For farmers, however, CERCLA liability may actually be comparatively beneficial. The CERCLA exemption does not
protect them from state cleanup responsibility because the exemption does not appear to preempt state law, such as
State Spill Fund cleanup requirements.431 Accordingly, if farmers are subject to state cleanup laws, which are often
stricter than federal requirements, they may not be able to bring in other responsible parties to contribute to cleanup
costs. However, if CERCLA's joint and several liability scheme controls the cleanup, the statute may provide flexibility to
allow farmers to join other potentially responsible parties.
2. RCRA
CERCLA is not the only federal statute that may impose liability upon farmers for the land application of sewage sludge.
RCRA also governs disposal of "solid waste."432 Section 1004(27) of RCRA defines "solid waste" as "garbage, refuse,
sludge from a waste treatment plant, water supply treatment plant. . . and other discarded material . . . ."433The use of
the term "discarded material" has led to a longstanding debate about whether secondary materials that are reused and
recycled are "solid waste," and thus within the jurisdiction of RCRA.434 While EPA has sometimes vascillated about
whether other recycled materials are solid waste under RCRA, it has been the agency's consistent opinion, since 1979,
that sewage sludge used as fertilizer is a solid waste.435
In 1985, EPA amended its hazardous waste regulations to more clearly define when secondary waste materials (sewage
sludges) are considered to be solid wastes.436 EPA then explicitly took the position that all sewage sludges used in a
manner constituting disposal (i.e. placed on the land) were solid waste, even if used as fertilizer.437 It is unlikely that
sewage sludge used as fertilizer pursuant to section 405 of the CWA would be listed as hazardous waste. However,
under RCRA sections 7002 and 7003, as a nonhazardous solid waste, sewage sludge may still be subject to corrective
action requirements if disposed of at a facility requiring a RCRA Subtitle C Permit (which would not be the case for land
application to cropland or rangeland, or abatement action).
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Under the citizen suit provision of RCRA's section 7002, private RCRA cleanup actions might also be brought against
sewage sludge applicators by plaintiffs seeking reimbursement of cleanup costs.439 For years, it appeared that the
citizen suit remedy provided by RCRA was limited to the abatement of the contamination, not reimbursement of cleanup
costs.440 In KFC Western, Inc. v. Meghrig, however, a private cost recovery action against former service station
operators was successfully maintained by a party who had cleaned up a petroleum release on that parcel.441 Thus, it
appeared that private parties could obtain more complete relief under RCRA section 7002 then they could obtain under
CERCLA. However, the Supreme Court reversed the Ninth Circuit, holding that because plaintiffs had already cleaned
up the site, no imminent and substantial endangerment existed so as to allow for recovery of cleanup costs.442 The
Court stated that the RCRA citizen suit provision was not intended to provide compensation for past cleanup efforts.443
If an imminent and substantial endangerment still exists, however, it seems that private parties may recover response
costs for work taken thereafter.
Furthermore, while sewage sludge may not be listed as hazardous waste under RCRA, it may be regulated as such if it
exhibits RCRA toxicity characteristics or is derived from a listed waste.444 The domestic sewage exemption in section
1004 of RCRA does not provide a defense against a potential RCRA suit based on the land application of sewage
sludge-it has been a long-standing position of EPA that this "domestic sewage exemption" does not extend to residuals
from the treatment of domestic sewage.445
The potential for CERCLA and RCRA liability for sewage sludge reuse projects depends on two factors: (1) the
likelihood of harm occurring that would lead to legal action; and (2) the existence of a legal basis to support such an
action.446 The above discussion outlines possible statutory liability for flawed beneficial reuse projects, although
research has disclosed no CERCLA or RCRA legal actions in which plaintiffs have successfully recovered cleanup costs
and natural resource damages resulting from land application projects.447 But as time passes and scientific knowledge
increases, it is possible that even beneficial reuse projects performed in conformance with applicable regulations may
result in contamination, thus subjecting them to federal statutory liability under CERCLA and RCRA.
V. RISK-SHARING MECHANISMS
In examining the legal problems associated with sewage sludge application, one fact has become clear: "liability. . . is an
orphan-no one wants it, nor could any private business or individual accept it and stay in business."448 It is therefore
not surprising that Farm Credit Institutions, consisting of major farm lenders in the United States, have also raised
concerns over the potential damage to farmer livelihood should properties be subjected to the potential liabilities
discussed above.449 Naturally, lenders do not wish to be subject to joint and several liability, and wish to preserve land
productivity and value. Under CERCLA, ownership alone triggers liability, even though the owner has not actually
participated in generating or disposing of the substance.450 Lenders have been found liable for clean ups even if they
did not acquire the property, but had the capacity to affect hazardous waste disposal decisions 451 EPA has proposed
a system of de minimus landowner settlements under CERCLA, and has exempted lenders from the definition of
"owner-operator" if the lender does not participate in management and holds an "indicia of ownership primarily to
protect [his] security interest ...."452 If, however, a lender becomes an owner by foreclosing and taking title to the
property, or by conducting management activities at the site, he is potentially liable.453
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Lenders are also wary of the other possible legal actions, discussed above, that may be brought against them or other
parties involved. Thus, in order to explore the issues relating to liability arising from land application of sewage sludge,
the Farm Credit Bank of Springfield, Massachusetts, invited a number of interested parties to a twoday symposium, in
November of 1993, on "Minimizing Risks and Sharing Liability from Application of Sludge and Sludge By-Products on
Agricultural Land." The purpose of the symposium was to recommend actions for minimizing any perceived or real risks
attached to land application, and to focus on the task of developing equitable risk-sharing mechanisms within the joint
and several liability framework.454 One conclusion was certain-under current law, landowners, farm operators, and
lenders are all potentially liable for risks arising from application of sewage sludge, unless one of them assumes such
risks from the others through a clear, legally enforceable mechanism. A variety of management tools and risk-sharing
mechanisms were explored at the Symposium. The following is a description of three of these-bonds, insurance, and
express indemnification agreements.