Potential “Hazardous Substances” Listing
In September 2022, the Environmental Protection Agency (EPA) issued a proposed rule that would designate two PFAS compounds, perfluorooctanoic acid (PFOA) and perfluorooctane sulfonic acid (PFOS), as hazardous substances under Section 102(a) of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). 87 Fed. Reg. 54415 (Sept. 6, 2022). If the proposed rulemaking becomes law, expect immediate impacts to CERCLA National Priority List (NPL) sites, including potential re-openers and a broad swath of new potentially responsible parties (PRPs).
Tangential to that issue is EPA’s adoption of ASTM’s E1527-21 standard for Phase I environmental site assessments, effective as of February 13, 2023, as satisfying the all-appropriate-inquiries rule. The new standard is the first to adopt consideration of emerging contaminants, including PFAS, in a Phase I assessment. If, however, EPA ends up listing PFAS compounds as CERCLA hazardous substances, evaluation of PFAS impacts will become compulsory. Purchasers of real estate will need to ensure that they are asking the right questions in evaluating the property. Given the range of industries that have historically used PFAS compounds—from aviation to cosmetics to textiles—a close evaluation of current and historical uses of the property and adjacent properties will be necessary. PFAS is also highly mobile in groundwater. As a result, evaluation of surrounding land uses for PFAS-related industry will be crucial. PFAS compounds have also been historically prevalent in certain firefighting foams. As such, purchasers should evaluate the history of fire at a property, as well as the current and historic firefighting infrastructure in place at the property.
Environmental professionals wishing to go the extra mile could potentially incorporate a review of the Toxic Release Inventory (TRI), a publicly available database containing information on chemical use and waste management. Those companies that use TRI-listed chemicals, subject to a weight threshold, are required to report their use to EPA. In late 2019, EPA added certain PFAS required to be reported to EPA. Although initial reporting numbers were underwhelming due to the relatively low quantity of PFAS compounds required for most uses, EPA has signaled its intent to categorize PFAS as a “Chemical of Special Concern” that would eliminate the de minimis exemption used by companies that use small quantities of PFAS compounds. As a result, the number of companies reporting PFAS use is expected to increase significantly in 2023.
Although the TRI is typically used by communities, governmental agencies, and others to identify potential sources of contamination, it could also be used by environmental professionals in evaluating a property and its surrounding properties for PFAS use.
Consumer Products Bans—Food Packaging, Cosmetics, and Textiles
California, New York, and Vermont have taken action on PFAS in food packaging. The California Safer Food Packaging Cookware Act of 2021, which went into effect on January 1, 2023, prohibits the sale or distribution of any food packaging that contains PFAS. The act defines food packaging to be any “nondurable package” that is originally derived from plant fibers. Cal. Health & Safety Code § 109000(a)(1). The act also requires cookware manufacturers that sell cookware in the state of California to list the presence of PFAS in the cookware handle or any surface of the cookware that comes into contact with food. New York’s ban, which went into effect on December 31, 2022, is similar to California’s ban but does not extend to the cookware labeling requirements. California’s and New York’s bans follow Maine, which was the first state to enact a food packaging ban. Maine’s ban went into effect in July 2022.
Notably, the bans enacted to date in Maine, California, and New York do not specify particular PFAS that cannot be used in the packaging. Past regulations around PFAS have often zeroed in on PFOA or PFOS or five or six other highly prevalent PFAS compounds. As a result, the laws apply to any of the nearly 9,000 PFAS compounds that exist today.
A handful of other states—Colorado, Connecticut, Hawaii, Maryland, Minnesota, Rhode Island, Vermont, and Washington—also have implemented bans that take effect in the next two years. Many food companies, including Wendy’s, Burger King, McDonald’s, Whole Foods, and Chipotle, have proactively eliminated, or plan to eliminate, all PFAS from their food packaging.
Although not as widespread as the food packaging bans, several states have enacted or proposed bills that would restrict the manufacture and sale of cosmetics and textiles that contain certain PFAS compounds, including PFOA and PFOS. California’s initial ban on PFAS-containing cosmetics was limited to 15 or so compounds. In 2022, however, a California statute broadened the ban to all PFAS compounds. Cal. Health & Safety Code § 108981.5. Maryland, Minnesota, New York, Maine, and Colorado also have moved to act on PFAS-containing cosmetics.
In addition, California, Washington, and a few other states have enacted bills that phase out the use of PFAS in certain textiles. Under the California Safer Clothes and Textiles Act of 2022, textiles are broadly defined to include “apparel, accessories, handbags, backpacks, draperies, shower curtains, furnishings, upholstery, beddings, towels, napkins, and tablecloths.” Cal. Health & Safety Code § 108970(i)(1). California’s law contains a few notable carveouts, including apparel meant for exclusive use by the United States military, architectural fabric structures (e.g., stadium shades), and filtration media. Outdoor apparel for “severe wet conditions,” such as outerwear used in offshore fishing, offshore sailing, whitewater kayaking, and canyoneering, has a delayed ban that does not take effect until 2028. Id. §§ 108970(d), 108971(a)(2).