Was Settlement Agreement in Massive Superfund Case Tainted?

Government overreach and possibly improper participation of former EPA employee plague settlement yielding pennies on dollar of cleanup costs at Superfund site

Today, government watchdog Protect the Public’s Trust announced an ethics complaint regarding a former Environmental Protection Agency (EPA) official who was deeply involved in a controversial issue he also participated in while working for the agency years ago. The former employee is a primary negotiator in a nearly $2 billion Superfund cleanup project that appears to involve at least 14 separate parties with whom he interacted on the same issue as a federal official, a possible violation of what is known as the “Lifetime Ban” for federal employees.

In December 2022, EPA entered into a consent decree with 85 entities accused of having contributed to the pollution of the Lower Passaic River in New Jersey known as the Diamond Alkali Superfund Site. These 85 entities agreed to pay $150 million as part of the settlement, an amount representing less than 10 percent of the estimated $1.8 billion total costs for the cleanup. At least one New Jersey assemblywoman expressed the concern that the more than $1 billion gap “will likely fall onto the taxpayers of the municipalities whose river was polluted or to residents of the State of New Jersey.”

Whistleblower information obtained by PPT, as well as publicly available documents, court filings, and media reports appear to indicate that David Batson, a former Senior Alternative Dispute Resolution (ADR) Specialist and ADR Counsel at EPA, was involved in the Diamond Alkali Superfund Site not only during his tenure at EPA but continued his involvement after leaving the agency in 2015. While at EPA he worked on a settlement agreement involving at least a dozen of the entities that also are part of the consent decree. According to his 2019 resume, after entering the private sector he “[s]erved as allocator for the design and conduct of a unique allocation process” at the site. His continued involvement seemingly put him in a position to “switch sides” on the matter and use his federal service to benefit his current employer. This may have run afoul of post-government ethics obligations, including the “Lifetime Ban” that prohibits a former federal employee from participating in certain matters the employee worked on while in federal service.

The ethics concerns surrounding the former employee are only amplified by broader issues concerning the EPA’s potential overreach on management of the Superfund program. The “unique allocation process” employed at the Diamond Alkali site had been twice rejected by Congress for use by the EPA. The failed legislative proposals, for which Mr. Batson has claimed to be “the primary author,” relied on “a non-government, third-party neutral” in the allocation process at Superfund sites. Coincidentally, a “non-government, third-party neutral” employing the former Senior ADR of a Superfund site, such as Mr. Batson’s employer, would be uniquely positioned to contract with EPA for the services described in Mr. Batson’s failed legislative proposals. This allocation process appears to have been used at Diamond Alkali, apparently to the benefit of Mr. Batson’s current employer.

Since its inception, PPT has warned of the influence of special interests and the revolving door’s role in driving significant policy decisions. We recently commenced a Freedom of Information Act project, beginning at EPA, to obtain information on the participation of former government employees in matters involving their current employers and their prior government agencies. With trillions in new government spending recently approved to fund new programs, many at the EPA, the potential for abuse is rampant. More than ever, the public needs diligent oversight by agency and congressional watchdogs alike.

“The American public has to trust that its government is an impartial and neutral participant in matters that affect their lives and their pocketbooks,” declared Michael Chamberlain, Director of Protect the Public’s Trust. “As the government grows by the trillions, it becomes even more vital that its decisions are not influenced by revolving doors, conflicts of interest, and switching sides. Only a thorough investigation into our complaint would demonstrate a commitment to stopping the steady decline in public trust.”

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