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United States v. Chevron Mining Inc.

United States District Court, D. New Mexico

April 28, 2017

UNITED STATES OF AMERICA, STATE OF NEW MEXICO, and NEW MEXICO ENVIRONMENT DEPARTMENT, Plaintiffs,
v.
CHEVRON MINING INC., Defendant.

          FOR THE UNITED STATES OF AMERICA: JOHN C. CRUDEN Assistant Attorney General, NICOLE VEILLEUX Senior Counsel Environmental Enforcement Section Environment and Natural Resources Division U.S. Department of Justice

          FOR THE UNITED STATES OF AMERICA: DAMON P. MARTINEZ United States Attorney, HOWARD R. THOMAS Assistant United States Attorney

          FOR THE U.S. ENVIRONMENTAL PROTECTION AGENCY: Carl E. Edlund Director, Superfund Division U.S. Environmental Protection Agency, Elizabeth Pletan Assistant Regional Counsel U.S. Environmental Protection Agency

          FOR THE STATE OF NEW MEXICO: HECTOR BALDERAS Attorney General, William Grantham Assistant Attorney General

          FOR THE STATE OF NEW MEXICO: Ryan Flynn Cabinet Secretary, jennifer Hower - Certifying Legal Sufficiency Deputy General Counsel

          FOR THE STATE OF NEW MEXICO: David Martin Cabinet Secretary New Mexico Energy, Minerals and Natural Resources Department, Bill Brancard - Certifying Legal Sufficiency General Counsel New Mexico Energy, Minerals and Natural Resources Department

          FOR CHEVRON MINING, INC. Robert R. John Agent Authorized to Accept Service on Behalf of Above-signed Party: Steven M. Jawetz Beveridge & Diamond, P.C., Louis W. Rose Montgomery & Andrews, P.A.

          FOR CHEVRON MINING, INC. Robert R. John Agent Authorized to Accept Service on Behalf of Above-signed Party: Steven M. Jawetz Beveridge & Diamond, P.C., Louis W. Rose Montgomery & Andrews, P.A.

          FIRST PARTIAL REMEDIAL DESIGN/REMEDIAL ACTION (RD/RA) CONSENT DECREE

         TABLE OF CONTENTS

         I. BACKGROUND.........................................................................................................................1

         II. JURISDICTION..........................................................................................................................4

         III. PARTIES BOUND.....................................................................................................................5

         IV. DEFINITIONS............................................................................................................................5

         V. GENERAL PROVISIONS........................................................................................................13

         VI. PERFORMANCE OF THE WORK BY CMI..........................................................................16

         VII. QUALITY ASSURANCE, SAMPLING, AND DATA ANALYSIS.......................................20

         VIII. ACCESS AND INSTITUTIONAL CONTROLS.....................................................................22

         IX. REPORTING REQUIREMENTS.............................................................................................25

         X. EPA APPROVAL OF PLANS, REPORTS, AND OTHER DELIVERABLES.......................26

         XI. PROJECT COORDINATORS..................................................................................................28

         XII. PERFORMANCE GUARANTEE............................................................................................29

         XIII. CERTIFICATION OF COMPLETION....................................................................................37

         XIV. EMERGENCY RESPONSE.....................................................................................................38

         XV. PAYMENTS FOR RESPONSE COSTS..................................................................................39

         XVI. INDEMNIFICATION AND INSURANCE..............................................................................44

         XVII. FORCE MAJEURE...................................................................................................................46

         XVIII. DISPUTE RESOLUTION........................................................................................................48

         XIX. STIPULATED PENALTIES....................................................................................................52

         XX. COVENANTS BY PLAINTIFFS.............................................................................................56

         XXI. COVENANTS BY CMI............................................................................................................61

         XXII. EFFECT OF SETTLEMENT; CONTRIBUTION....................................................................64

         XXIII. ACCESS TO INFORMATION.................................................................................................66

         XXIV. RETENTION OF RECORDS...................................................................................................68

         XXV. NOTICES AND SUBMISSIONS.............................................................................................70

         XXVI. RETENTION OF JURISDICTION..........................................................................................71

         XXVII. APPENDICES...........................................................................................................................71

         XXVIII. COMMUNITY LNVOLVEMENT............................................................................................72

         XXIX. MODIFICATION......................................................................................................................72

         XXX. LODGLNG AND OPPORTUNITY FOR PUBLIC COMMENT.............................................73

         XXXI. SIGNATORIES/SERVICE.......................................................................................................73

         XXXII. FINAL JUDGMENT.................................................................................................................74

         I. BACKGROUND

         A. The United States of America ("United States"), on behalf of the Administrator of the United States Environmental Protection Agency ("EPA"), together with the State of New Mexico (the "State") and the New Mexico Environment Department ("NMED"), filed a joint complaint in this matter against Chevron Mining Inc. ("CMI").

         B. The United States and the State in their joint complaint seek, inter alia, reimbursement of costs incurred by EPA, the United States Department of Justice ("DOJ"), and the State for response actions at the Chevron Questa Mine Superfund Site in Taos County, New Mexico, together with accrued interest, pursuant to Section 107 of the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C § 9607. NMED further seeks performance of the Work described in Appendix A by CMI pursuant to the New Mexico Water Quality Act ("WQA"), NMSA 1978, §§ 74-6-10 and 74-6-11.

         C. In accordance with the NCP and Section 121(f)(1)(F) of CERCLA, 42 U.S.C. § 9621(f)(1)(F), EPA notified the State of New Mexico on September 14, 2011, of negotiations with CMI regarding the implementation of the remedial design and remedial action for the Site.

         D. The State of New Mexico is the regulatory authority under the New Mexico Water Quality Act and the New Mexico Mining Act and has issued permits to CMI for ongoing activities at the Site that contain requirements for mine reclamation and groundwater protection. EPA is the regulatory authority under CERCLA regarding the Work under this Partial Consent Decree, in consultation with the State.

         E. On September 30, 2015, the Court entered a Consent Decree in U.S. and State of New Mexico v. Chevron Mining, Inc., 14-cv-783 (KBM-SCY) (D.N.M). In the Complaint, Plaintiffs United States and State of New Mexico, on behalf of their natural resource trustee agencies - i.e., the State Office of Natural Resources Trustee, Fish and Wildlife Service of the U.S. Department of the Interior, and the Forest Service of the U.S. Department of Agriculture - asserted claims against Defendant Chevron Mining Inc. under CERCLA for injuries to natural resources resulting from Defendant's mining operations at the Site. The Consent Decree entered in that action resolves this claim for natural resource damages and requires Defendant to pay $4 million to fund restoration, replacement, or acquisition of natural resources, as well as to pay certain agency costs and to transfer a 225-acre parcel, including approximately 100 acres of sensitive riparian habitat. That separate action, including the Consent Decree, pertains only to natural resource damages caused by the Defendant's mining activities. In contrast, in this Consent Decree, the Defendant has agreed to perform certain response actions and to reimburse certain response costs incurred by the United States and the State of New Mexico.

         F. By entering into this Consent Decree, CMI does not admit any liability to Plaintiffs arising out of the transactions or occurrences alleged in the complaints, nor does it acknowledge that the release or threatened release of hazardous substances at or from the Site constitutes an imminent and substantial endangerment to the public health or welfare or the environment.

         G. On November 16, 2009, CMI submitted a Feasibility Study Report to EPA, which EPA approved on November 24, 2009.

         H. In January 2010, pursuant to CERCLA § 117, 42 U.S.C. § 9617, EPA published a notice of the issuance of the Proposed Cleanup Plan ("Proposed Plan") in The Taos News, a major local newspaper of general circulation, and advised the public of the opportunity to submit written and oral comments regarding the Proposed Plan. Public comments were submitted to EPA during an 85-day period which began on January 6, 2010, and ended on March 31, 2010.

         I. On December 20, 2010, EPA issued a Record of Decision ("ROD") describing the selected remedy and the reasons for selection of the remedy. The ROD includes an explanation of significant differences between the Proposed Plan and the ROD, as well as EPA's responses to public comments on the Proposed Plan. Notice of the final plan as set forth in the ROD was published in accordance with CERCLA § 117(b), 42 U.S.C. § 9617(b).

         J. On September 16, 2011, pursuant to CERCLA § 105, 42 U.S.C. § 9605, the Site was listed on the National Priorities List ("NPL"). 76 Fed. Reg. 57662 (Sept. 16, 2011).

         K. On March 7, 2012, CMI and EPA signed an Administrative Settlement Agreement and Order on Consent for Removal Actions, which was filed with the EPA Region 6 Hearing Clerk on March 8, 2012, in In the Matter of: Chevron Mining Inc., Respondent, CERCLA Docket No. 06-09-12 (hereinafter referred to as the "Removal AOC").

         L. On September 19 and 25, 2012, CMI and EPA, respectively, signed an Administrative Settlement Agreement and Order on Consent for Early Design Actions, which was filed with the EPA Region 6 Hearing Clerk on September 26, 2012, in In the Matter of: Chevron Mining Inc., Respondent, CERCLA Docket No. 06-13-12 (hereinafter referred to as the "Early Design AOC'').

         M. The Early Design AOC was amended on September 30, 2014, resulting in the First Amendment to the Administrative Settlement Agreement and Order on Consent for Early Design Actions. On November 13, 2014, the Early Design AOC was amended again, resulting in the Second Amendment to the Administrative Settlement Agreement and Order on Consent for Early Design Actions. All references herein to the Early Design AOC include these amendments as well as any others that become effective before or after the Effective Date of this Consent Decree.

         N. In this First Partial Remedial Design/Remedial Action Consent Decree, CMI has agreed to perform certain response actions set forth in the ROD and to pay certain costs. Other aspects of the remedy (as set forth in the ROD) are currently the subject of the Removal AOC and the Early Design AOC, as amended, or will otherwise be addressed separately from this Consent Decree at a later date.

         O. Based on the information currently available to EPA and the State, EPA and the State believe that the Work will be properly and promptly conducted by CM1 if conducted in accordance with the requirements of this Consent Decree and its appendices.

         P. Solely for the purposes of Section 113© of CERCLA, 42 U.S.C. § 96130), the remedy set forth in the ROD and the Work to be performed by CMI shall constitute a response action taken or ordered by the President for which judicial review shall be limited to the administrative record.

         Q, The Parties recognize, and the Court by entering this Consent Decree finds, that this Consent Decree has been negotiated by the Parties in good faith and implementation of this Consent Decree will expedite the cleanup of the Site and will avoid prolonged and complicated litigation between the Parties, and that this Consent Decree is fair, reasonable, and in the public interest.

         NOW, THEREFORE, it is hereby Ordered, Adjudged, and Decreed:

         II. JURISDICTION

         1. This Court has jurisdiction over the subject matter of this action pursuant to 28 U.S.C. §§ 1331, 1367, and 1345, and 42 U.S.C. §§ 9606, 9607, and 9613(b). This Court also has personal jurisdiction over CMI. Solely for the purposes of this Consent Decree and the underlying complaints, CMI waives all objections and defenses that it may have to jurisdiction of the Court or to venue in this District. CMI shall not challenge the terms of this Consent Decree or this Court's jurisdiction to enter and enforce this Consent Decree.

         III. PARTIES BOUND

         2. This Consent Decree applies to and is binding upon the United States and the State and upon CMI and its successors and assigns. Any change in ownership or corporate status of CMI including, but not limited to, any transfer of assets or real or personal property, shall in no way alter the Settling Defendant's responsibilities under this Consent Decree.

         3. CMI shall provide a copy of this Consent Decree to each contractor hired to perform the Work required by this Consent Decree and to each person representing CMI with respect to the Site or the Work, and shall condition all contracts entered into hereunder upon performance of the Work in conformity with the terms of this Consent Decree. CMI or its contractors shall provide written notice of the Consent Decree to all subcontractors hired to perform any portion of the Work required by this Consent Decree. CMI shall nonetheless be responsible for ensuring that its contractors and subcontractors perform the Work in accordance with the terms of this Consent Decree. With regard to the activities undertaken pursuant to this Consent Decree, each contractor and subcontractor shall be deemed to be in a contractual relationship with CMI within the meaning of Section 107(b)(3) of CERCLA, 42 U.S.C. § 9607(b)(3).

         IV. DEFINITIONS

         4. Unless otherwise expressly provided in this Consent Decree, terms used in this Consent Decree that are defined in CERCLA or in regulations promulgated under CERCLA shall have the meaning assigned to them in CERCLA or in such regulations. Whenever terms listed below are used in this Consent Decree or its appendices, the following definitions shall apply solely for purposes of this Consent Decree:

"Chevron Questa Mine Superfund Site Special Account" shall mean the special account, within the EPA Hazardous Substance Superfund, established for the Site by EPA pursuant to Section 122(b)(3) of CERCLA, 42 U.S.C. § 9622(b)(3).
"CERCLA" shall mean the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. §§ 9601-9675.
"CMP shall mean Chevron Mining Inc.

         "CMI's Related Parties" shall mean (i) CMI's successors and assigns, but only to the extent that the alleged liability of such person is based on the alleged liability of CMI; (ii) CMI's former or current officers, directors and employees, but only to the extent that the alleged liability of such person is based on acts and/or omissions that occurred in the scope of the person's employment or capacity as an officer, director or employee of CMI; (iii) Union Oil Company of California and Unocal Corporation, but only to the extent that the alleged liability of such entity is based on its status as the direct or indirect corporate parent of CMI (f/k/a Molycorp Inc.) or its alleged status as a former owner or operator of the Site; and (iv) the former or current officers, directors and employees of Union Oil Company of California and Unocal Corporation, but only to the extent that the alleged liability of such person is based on the person's employment or capacity as an officer, director or employee of Union Oil Company of California or Unocal Corporation.

         "CMI Property" shall mean the areas within the yellow property lines depicted by Figures 1 -2 and 1-3, provided as Attachments 1 and 2 to Appendix A.

         "Consent Decree, " "Decree" and "Partial Consent Decree" shall mean this Consent Decree and all appendices attached hereto (listed in Section XXVII).

         "Day" or "day" shall mean a calendar day unless expressly stated to be a working day. The term "working day" shall mean a day other than a Saturday, Sunday, or federal or state holiday. In computing any period of time under this Consent Decree, where the last day would fall on a Saturday, Sunday, or federal or state holiday, the period shall run until the close of business of the next working day.

         "DOJ" shall mean the United States Department of Justice and its successor departments, agencies, or instrumentalities.

         "Effective Date'* shall mean the date upon which this Consent Decree is entered by the Court as recorded on the Court docket, or, if the Court instead issues an order approving the Consent Decree, the date such order is recorded on the Court docket.

         "EMNRD" shall mean the New Mexico Energy, Minerals and Natural Resources Department and its successor departments, agencies or instrumentalities.

         "EPA" shall mean the United States Environmental Protection Agency and its successor departments, agencies, or instrumentalities.

         "EPA Hazardous Substance Superfund" shall mean the Hazardous Substance Superfund established by the Internal Revenue Code, 26 U.S.C. § 9507.

         "Future Response Costs" shall mean all costs, including, but not limited to, direct and indirect costs, that the United States, and the State as applicable, incur in reviewing or developing plans, reports, and other deliverables submitted pursuant to this Consent Decree, in overseeing implementation of the Work, or otherwise implementing, overseeing, or enforcing this Consent Decree, including, but not limited to, payroll costs, contractor costs, travel costs, laboratory costs, the costs incurred pursuant to Paragraph 9 (Notice to Successors-in-Title and Transfers of Real Property), Sections VIII (Access and Institutional Controls) (including, but not limited to, the cost of attorney time and any monies paid to secure access and/or to secure, implement, monitor, maintain, or enforce Institutional Controls including, but not limited to, the amount of just compensation), XIV (Emergency Response), Paragraph 46 (Funding for Work Takeover), and Section XXVIII (Community Involvement). Future Response Costs shall also include all Interim Response Costs and all Interest on those Past Response Costs that CMI has agreed to pay under this Consent Decree that has accrued pursuant to 42 U.S.C. § 9607(a) during the period from March 1, 2015 to the Effective Date. Future Response Costs shall also include all costs not inconsistent with the NCP, incurred by the United States or the State from the Effective Date forward, in implementing the Removal AOC (EPA Docket No. 06-09-12) and the Early Design AOC (EPA Docket No. 06-13-12). Future Response Costs shall not include any costs that the State incurs in administering the State Permits.

         "FWPCA" shall mean the Federal Water Pollution Control Act, as amended, 33 U.S.C. §§ 1251-1387 (also known as the Clean Water Act).

         "Interim Response Costs" shall mean all unreimbursed costs, including, but not limited to, direct and indirect costs, (a) paid by the United States or the State in connection with the Site between March 1, 2015 and the Effective Date, or (b) incurred prior to the Effective Date but paid after that date.

         "Interest" shall mean interest at the rate specified for interest on investments of the EPA Hazardous Substance Superfund established by 26 U.S.C. § 9507, compounded annually on October 1 of each year, in accordance with 42 U.S.C. § 9607(a). The applicable rate of interest shall be the rate in effect at the time the interest accrues. The rate of interest is subject to change on October 1 of each year. Rates are available online at: http://www.epa.gov/superfund/superfund-interest-rates.

         "Mine Site Area" shall mean the area within the yellow boundary lines depicted by Figure 1- 2 and designated as the "Questa Mine Site" by Attachment 1 to Appendix A.

         "MMD" shall mean the Mining and Minerals Division of the New Mexico Energy, Minerals and Natural Resources Department.

         "MMD Permit" shall mean any and all permits issued by MMD, pursuant to the NMMA and MMD Regulations, to CMI and/or its successor in connection with the Mine Site Area and the Tailing Facility Area, including without limitation Permit No. TA001RE (MMD), as such permit may have been or may be amended, modified or revised from time to time.

         "MMD Regulations" shall mean regulations adopted pursuant to the NMMA, including without limitation Title 19 Chapter 10 Part 1 through Title 19 Chapter 10 Part 14 NMAC, as such regulations may have been or may be amended from time to time.

         "National Contingency Plan" or "NCP" shall mean the National Oil and Hazardous Substances Pollution Contingency Plan promulgated pursuant to Section 105 of CERCLA, 42 U.S.C. § 9605, codified at 40 C.F.R. Part 300, and any amendments thereto.

         "NMED" shall mean the New Mexico Environment Department and any successor departments, agencies or instrumentalities.

         "NMED Permit" shall mean shall mean any and all permits issued by NMED, pursuant to the WQA and NMED Regulations, to CMI and/or its successor in connection with the Mine Site Area and the Tailing Facility Area, including without limitation Ground Water Discharge Permit Nos. DP-1055, DP-933, and DP-1539, as such permits may have been or may be amended, modified or revised from time to time.

         "NMED Regulations" shall mean regulations adopted pursuant to the WQA, including without limitation Title 20 Chapter 6 Part 2 NMAC, as such regulations may have been or may be amended from time to time.

         "NMMA" shall mean the New Mexico Mining Act, NMSA 1978, §§ 69-36-1 to -20.

         "Operation and Maintenance" or "O&M" shall mean all activities required to maintain the effectiveness of the Remedial Action as required under the Operation and Maintenance Plan approved or developed by EPA pursuant to Section VI (Performance of the Work by CMI) of this Consent Decree and the SOW.

         "Paragraph" shall mean a portion of this Consent Decree identified by an Arabic numeral or an upper or lower case letter, or combinations thereof.

         "Parties" shall mean the United States, the State of New Mexico and CMI.

         "Past Response Costs" shall mean all costs, including, but not limited to, direct and indirect costs, that the United States paid at or in connection with the Site from November 24, 2009 through February 28, 2015, plus Interest on all such costs that has accrued pursuant to 42 U.S.C. § 9607(a) through such date.

         "Past Response Costs (State)" shall mean all costs, including, but not limited to, direct and indirect costs, that the State paid at or in connection with the Site through February 28, 2015, plus Interest on all such costs that has accrued pursuant to 42 U.S.C. § 9607(a) through such date.

         "Performance Standards" shall mean the remedial action objectives, cleanup standards and other measures of achievement of the goals of the Remedial Action, set forth in the ROD and the SOW and any modified standards established pursuant to this Consent Decree.

         "Plaintiffs" shall mean the United States, the State of New Mexico and NMED.

         "Record of Decision" or "ROD" shall mean the EPA Record of Decision relating to the Chevron Questa Mine Superfund Site Dated: December 20, 2010, by the Superfund Division Director, EPA Region 6, and all attachments thereto. The ROD is available from EPA's website and upon request.

         "Remedial Action" or "RA" shall mean all the Remedial Action Projects that CMI is required to perform under this Consent Decree to implement the ROD, consistent with the SOW, the final approved remedial design submission, the approved Remedial Action Project Work Plan(s), and other plans approved by EPA, including implementation of Institutional Controls, until the Performance Standards are met, and excluding performance of the Remedial Design, O&M, and the activities required under Section XXIV (Retention of Records).

         "Remedial Action Work Plan" shall mean the document(s) developed pursuant to Section 10 of the Statement of Work and approved by EPA, as well as any modifications thereto.

         "Remedial Design" or "RD" shall mean those activities to be undertaken by CMI to develop the final plans and specifications for the Remedial Action pursuant to the Remedial Design Work Plan, as specified in the SOW.

         "Remedial Design Work Plan" shall mean the document(s) developed pursuant to Sections 8 and 9 of the Statement of Work and approved by EPA, as well as any modifications thereto.

         "Section" shall mean a portion of this Consent Decree identified by a Roman numeral.

         "Settling Defendant" shall mean Chevron Mining Inc.

         "Site" shall mean the Chevron Questa Mine Superfund Site, located in Taos County, New Mexico. The Site consists of a molybdenum mine and milling facility located approximately four miles east of the Village of Questa on approximately three square miles of land owned and operated by CMI (lat. 36°41' 54" N., long. 105°30' 18" W). The mine includes underground mine workings, an historic open pit, nine waste rock dumps or piles surrounding the open pit and a subsidence area which represents a surface-collapse feature above the ore extraction area. The Site also includes a tailing pipeline running parallel to State Highway 38, the area in the vicinity of the pipeline and the Tailing Facility in the Village of Questa flat. 36°42' 13" N., long. 105°36' 40" W. and lat. 36°42' 08" N., long. 105°37' 54" W.). The Site also includes all other areas where any hazardous substance, pollutant or contaminant from the Molycorp, Inc. (or successor) mining, milling and tailing disposal operations is located. The Site is depicted generally on Figures 1-2 and 1-3, provided as Attachments 1 and 2 to Appendix A.

         "State" shall mean the State of New Mexico, and, unless otherwise specified, refers specifically to both NMED and MMD; in Section XX (Covenants by Plaintiffs) only, ''State" shall include each department, agency, and instrumentality of the State.

         "State Permits" shall mean the MMD Permit and NMED Permit.

         "State Regulations" shall mean the MMD Regulations and the NMED Regulations.

         "Statement of Work" or "SOW" shall mean the statement of work for implementation of the Remedial Design, Remedial Action, and O&M at the Site, as set forth in Appendix A to this Consent Decree and any modifications made in accordance with this Consent Decree.

         "Supervising Contractor" shall mean the principal contractor(s) retained by CMI to supervise and direct the implementation of the Work under this Consent Decree.

         "SWDA" shall mean the Solid Waste Disposal Act, as amended, 42 U.S.C. §§ 6901-6992k (also known as the Resource Conservation and Recovery Act or "RCRA").

         "Tailing Facility Area" shall mean the area within the yellow boundary lines depicted by Figure 1-3 and designated as the "Questa Tailing Facility" on Attachment 2 to Appendix A.

         "Transfer" shall mean to sell, assign, convey, lease, mortgage, or grant a security interest in, or where used as a noun, a sale, assignment, conveyance, or other disposition of any interest by operation of law or otherwise.

         "United States" shall mean the United States of America and each department, agency, and instrumentality of the United States, including EPA.

         "Waste Material" shall mean (1) any "hazardous substance" under Section 101(14) of CERCLA, 42 U.S.C. § 9601(14); (2) any pollutant or contaminant under Section 101(33) of CERCLA, 42 U.S.C. § 9601(33); and (3) any "solid waste" as defined by SWDA § 1004(27), 42 U.S.C. § 6903(27).

         "Work" shall mean all activities and obligations CMI is required to perform under this Consent Decree, including Operation and Maintenance, except the activities required under Section XXIV (Retention of Records).

         "WQA" shall mean the New Mexico Water Quality Act, NMSA 1978, §§ 74-6-1 to -17.

         V. GENERAL PROVISIONS

         5. Objectives of the Parties. The objectives of the Parties in entering into this Consent Decree are to protect public health or welfare or the environment by the design and implementation of the specified response actions at the Site by CMI, to pay response costs of the Plaintiffs, and to resolve certain claims of the Plaintiffs against CMI, as provided in this Consent Decree.

         6. Commitments by CMI.

         CMI shall finance and perform the Work in accordance with this Consent Decree, the ROD, the SOW, and all work plans and other plans, standards, specifications, and schedules set forth in this Consent Decree or developed by CMI and approved by EPA pursuant to this Consent Decree. CMI shall pay the United States and the State for Past Response Costs and Future Response Costs as provided in this Consent Decree.

         7. Compliance with Applicable Law.

         All activities undertaken by CMI pursuant to this Consent Decree shall be performed in accordance with the requirements of all applicable federal and State laws and regulations. CMI must also comply with all applicable or relevant and appropriate requirements of all federal and State environmental laws, as set forth in the ROD and the SOW. The activities conducted pursuant to this Consent Decree, if approved by EPA, shall be deemed to be consistent with the NCP.

         8. Permits.

         a. As provided in Section 121(e) of CERCLA, 42 U.S.C. § 9621(e), and Section 300.400(e) of the NCP, no permit, other than as provided in the ROD, shall be required for any portion of the Work conducted entirely on-site (i.e., within the areal extent of contamination or in very close proximity to the contamination and necessary for implementation of the Work). Where any portion of the Work that is not on-site requires a federal or state permit or approval, CMI shall submit timely and complete applications and take all other actions necessary to obtain all such permits or approvals.

         b. CMI may seek relief under the provisions of Section XVII (Force Majeure) for any delay in the performance of the Work resulting from a failure to obtain, or a delay in obtaining, any permit or approval referenced in Paragraph 8.a and required for the Work, provided that it has submitted timely and complete applications and taken all other actions necessary to obtain all such permits or approvals.

         c. This Consent Decree is not, and shall not be construed to be, a permit issued pursuant to any federal or state statute or regulation.

         d. The State intends to amend any State Permit provisions that pertain to the Work to ensure their consistency with the requirements of the SOW. In the event that State Permit provisions pertain to the Work but have not been amended to conform thereto, the State will not enforce the obligations or directives of the State Permits that are inconsistent with the SOW. The State agrees to address any alleged noncompliance with the SOW solely pursuant to this Consent Decree, in cooperation with EPA.

         9. Notice to Successors-in-Title and Transfers of Real Property.

         a. For any real property owned or controlled by CMI located at the Site, CMI shall, within 15 days after the Effective Date, submit to EPA and the State for review and approval a proposed notice to be filed with the appropriate land records office that provides a description of the real property and provides notice to all successors-in-title that the real property is part of the Site, that EPA has selected a remedy for the Site, and that potentially responsible parties have entered into a Consent Decree requiring implementation of a portion of the remedy. The notice also shall describe the land use restrictions, if any, set forth in Paragraphs 21 .j and 23 and shall identify the United States District Court in which the Consent Decree was filed, the name and civil action number of this case, and the date the Consent Decree was entered by the Court. CMI shall record the notice within ten days after EPA's approval of the notice. CMI shall provide EPA and the State with a certified copy of the recorded notice within ten days after recording such notice.

         b. CMI shall, at least 60 days prior to any Transfer of any real property located at the Site, give written notice: (1) to the transferee regarding the Consent Decree and any Institutional Controls regarding the real property; and (2) to EPA and the State regarding the proposed Transfer, including the name and address of the transferee and the date on which the transferee was notified of the Consent Decree and any Institutional Controls.

         10. In the event of any Transfer of real property located at the Site, unless the United States and the State otherwise consent in writing, CMI shall continue to comply with its obligation under the Consent Decree, including, but not limited to, its obligation to provide and/or secure access, to implement, maintain, monitor, and report on Institutional Controls, and to abide by such Institutional Controls. In addition, in the event of any Transfer of real property located at the Site, unless NMED and MMD consent in writing, CMI shall continue to be the permittee under all permits that have been issued to CMI at the Site by NMED or MMD.

         VI. PERFORMANCE OF THE WORK BY CMI

         11. Selection of Supervising Contractor.

         a. All aspects of the Work to be performed by CMI pursuant to Sections VI (Performance of the Work by CMI), VII (Quality Assurance, Sampling, and Data Analysis), VIII (Access and Institutional Controls), and XIV (Emergency Response) shall be performed under the direction and supervision of one or more Supervising Contractor(s), the selection of which shall be subject to disapproval by EPA, after a reasonable opportunity for review and comment by the State. Within ten days after the Effective Date of this Consent Decree, CMI shall notify EPA and the State in writing of the name, title, and qualifications of any contractor proposed to be the Supervising Contractor, With respect to any contractor proposed to be Supervising Contractor, CMI shall demonstrate that the proposed contractor has a quality assurance system that complies with ANSI/ASQC E4-1994, "Specifications and Guidelines for Quality Systems for Environmental Data Collection and Environmental Technology Programs" (American National Standard, January 5, 1995), by submitting a copy of the proposed contractor's Quality Management Plan (“QMP”). The QMP should be prepared in accordance with "EPA Requirements for Quality Management Plans (QA/R-2)" (EPA/240/B-01/002, March 2001, reissued May 2006) or equivalent documentation as determined by EPA. EPA will issue a notice of disapproval or an authorization to proceed regarding hiring of the proposed contractor. If at any time thereafter, CMI proposes to change a Supervising Contractor, CMI shall give such notice to EPA and the State and must obtain an authorization to proceed from EPA, after a reasonable opportunity for review and comment by the State, before the new Supervising Contractor performs, directs, or supervises any Work under this Consent Decree. CMI shall demonstrate that the proposed replacement contractor has a quality assurance system that complies with ANSI/ASQC E4-1994, "Specifications and Guidelines for Quality Systems for Environmental Data Collection and Environmental Technology Programs" (American National Standard, January 5, 1995), by submitting a copy of the proposed contractor's Quality Management Plan. The QMP should be prepared in accordance with "EPA Requirements for Quality Management Plans (QA/R-2)" (EPA/240/B-01/002, March 2001, reissued May 2006) or equivalent documentation as determined by EPA.

         b. If EPA disapproves a proposed Supervising Contractor, EPA will notify CMI in writing. CMI shall submit to EPA and the State a list of contractors, including the qualifications of each contractor, that would be acceptable to CMI within 30 days after receipt of EPA's disapproval of the contractor previously proposed, EPA will provide written notice of the names of any contractor(s) that it disapproves and an authorization to proceed with respect to any of the other contractors. CMI may select any contractor from that list that is not disapproved and shall notify EPA and the State of the name of the contractor selected within 21 days after EPA's authorization to proceed.

         c. If EPA fails to provide written notice of its authorization to proceed or disapproval as provided in this Paragraph and this failure prevents CMI from meeting one or more deadlines in a plan approved by EPA pursuant to this Consent Decree, CMI may seek relief under Section XVII (Force Majeure).

         12. Performance of the Work in accordance with the SOW.

         Unless an earlier deadline is set forth in the SOW, CMI shall, within 60 days after EPA's issuance of an authorization to proceed pursuant to Paragraph 11 (Selection of Supervising Contractor), commence implementation of the SOW and all EPA-approved, conditionally approved, or modified deliverables, as required by the SOW. Upon approval by EPA, each Remedial Design Work Plan and Remedial Action Project Work Plan, and all other plans required by the SOW to be developed by CMI, shall be automatically incorporated into and enforceable under this Consent Decree.

         13. CMI shall continue to implement the Remedial Action and the O&M until the Performance Standards are achieved.

         14. Modification of SOW or Related Work Plans.

         a. If EPA, after consulting with the State regarding, inter alia, the State Permits, determines that (i) it is necessary to modify the Work specified in the SOW, and/or in work plans developed pursuant to the SOW, to achieve and maintain the Performance Standards or to carry out and maintain the effectiveness of the remedy set forth in the ROD, and (ii) such modification is consistent with the scope of the remedy set forth in the ROD, as defined herein, then EPA may issue such modification in writing and shall notify CMI of such modification. For the purposes of this Paragraph and Paragraph 48 (Completion of the Work) only, the "scope of the remedy set forth in the ROD" corresponds to the Work described in Section 5 of the SOW (Appendix A). If CMI objects to the modification, it may, within 30 days after EPA's notification, seek dispute resolution under Paragraph 67 (Record Review).

         b. The SOW and/or related work plans shall be modified: (1) in accordance with the modification issued by EPA; or (2) if CMI invokes dispute resolution, in accordance with the final resolution of the dispute. The modification shall be incorporated into and shall be enforceable under this Consent Decree, and CMI shall implement all Work required by such modification. CMI shall incorporate the modification into the Remedial Design Work Plan(s) or Remedial Action Work Plan(s) developed pursuant to Paragraph 12 (Performance of the Work in accordance with the SOW) or the SOW, as appropriate.

         c. Nothing in this Paragraph shall be construed to limit EPA's authority to require performance of further response actions as otherwise provided in this Consent Decree.

         15. Nothing in this Consent Decree, the SOW, or the Remedial Design or Remedial Action Work Plans constitutes a warranty or representation of any kind by Plaintiffs that compliance with the Work requirements set forth in the SOW and the Work Plans will achieve the Performance Standards.

         16. Off-Site Shipment of Waste Material.

         a. CMI may ship Waste Material from the Site pursuant to this Consent Decree to an off-Site facility only if CMI complies with Section 121(d)(3) of CERCLA, 42 U.S.C. § 9621(d)(3) and 40 C.F.R. § 300.440. CMI will be deemed to be in compliance with CERCLA § 121(d)(3) and 40 C.F.R. § 300.440 regarding a shipment if CMI obtains a prior determination from EPA that the proposed receiving facility for such shipment is acceptable under the criteria of 40 C.F.R. § 300.440. CMI may ship Investigation Derived Waste ("IDW") from the Site to an off-Site facility, pursuant to this Consent Decree, only if CMI complies with EPA 's Guide to Management of Investigation Derived Waste, OSWER 9345.3-03FS (Jan. 1992).

         b. CMI may ship Waste Material from the Site pursuant to this Consent Decree to an out-of-state waste management facility only if, prior to any shipment, it provides written notice to the appropriate state environmental official in the receiving facility's state and to the EPA Project Coordinator. This notice requirement shall not apply to any off-Site shipments when the total quantity of all such shipments will not exceed ten cubic yards. The written notice shall include the following information, if available: (1) the name and location of the receiving facility; (2) the type and quantity of Waste Material to be shipped; (3) the schedule for the shipment; and (4) the method of transportation. CMI also shall notify the state environmental official referenced above and the EPA Project Coordinator of any major changes in the shipment plan, such as a decision to ship the Waste Material to a different out-of-state facility. CMI shall provide the written notice after the award of the contract for Remedial Action construction and before the Waste Material is shipped.

         VII. QUALITY ASSURANCE, SAMPLING, AND DATA ANALYSIS

         17. Quality Assurance.

         a. CMI shall use quality assurance, quality control, and chain of custody procedures for all sampling and analyses performed pursuant to this Consent Decree in accordance with "EPA Requirements for Quality Assurance Project Plans (QA/R5)" (EPA/240/B-01/003, March 2001, reissued May 2006), "Guidance for Quality Assurance Project Plans (QA/G-5)" (EPA/240/R-02/009, December 2002), and Uniform Federal Policy for Quality Assurance Project Plans, Parts 1-3, EPA/505/B-04/900A through 900C (Mar. 2005).

         b. Prior to the commencement of any sampling or analysis performed pursuant to this Consent Decree, CMI shall submit to EPA for approval, after a reasonable opportunity for review and comment by the State, Quality Assurance Project Plants) ("QAPP") that are consistent with the SOW, the NCP, and applicable guidance documents. If relevant to the proceeding, the Parties agree that validated sampling data generated in accordance with the QAPP and reviewed and approved by EPA shall be admissible as evidence, without objection, in any proceeding under this Consent Decree. CMI shall ensure that EPA and State personnel and their authorized representatives are allowed access at reasonable times to all laboratories utilized by CMI in implementing this Consent Decree. In addition, CMI shall ensure that such laboratories shall analyze all samples submitted by EPA pursuant to the QAPP for quality assurance monitoring. CMI shall ensure that the laboratories it utilizes for the analysis of samples taken pursuant to this Consent Decree perform all analyses according to accepted EPA methods. Accepted EPA methods consist of those methods that are documented in the "USEPA Contract Laboratory Program Statement of Work for Inorganic Analysis, ILM05.4, " and the "USEPA Contract Laboratory Program Statement of Work for Organic Analysis, SOM01.2, " and any amendments made thereto during the course of the implementation of this Consent Decree; however, upon approval by EPA, after opportunity for review and comment by the State, CMI may use other analytical methods that are as stringent as or more stringent than the CLP-approved methods. CMI shall ensure that all laboratories it uses for analysis of samples taken pursuant to this Consent Decree participate in an EPA or EPA-equivalent quality assurance/quality control ("QA/QC") program. CMI shall use only laboratories that have a documented Quality System that complies with ANSI/ASQC E4-1994, "Specifications and Guidelines for Quality Systems for Environmental Data Collection and Environmental Technology Programs" (American National Standard, January 5, 1995), and "EPA Requirements for Quality Management Plans (QA/R-2)" (EPA/240/B-01/002, March 2001, reissued May 2006) or equivalent documentation as determined by EPA. EPA may consider laboratories accredited under the National Environmental Laboratory Accreditation Program as meeting the Quality System requirements. CMI shall ensure that all field methodologies utilized in collecting samples for subsequent analysis pursuant to this Consent Decree are conducted in accordance with the procedures set forth in the QAPP approved by EPA.

         18. Upon request, CMI shall allow split or duplicate samples to be taken by EPA and the State or their authorized representatives. CMI shall notify EPA and the State not less than 14 days in advance of any sample collection activity unless shorter notice is agreed to by EPA and the State. In addition, EPA and the State shall have the right to take any additional samples that EPA or the State deem necessary. Upon request, EPA and the State shall allow CMI to take split or duplicate samples of any samples they take as part of Plaintiffs' oversight of CMI's implementation of the Work.

         19. CMI shall submit to EPA and the State the results of all sampling and/or tests or other data obtained or generated by or on behalf of CMI in the implementation of this Consent Decree unless EPA agrees otherwise.

         20. Notwithstanding any provision of this Consent Decree, the United States and the State retain all of their respective information gathering and inspection authorities and rights, including enforcement actions related thereto, under CERCLA, RCRA, NMMA, WQA, State Regulations and any other applicable statutes or regulations.

         VIII. ACCESS AND INSTITUTIONAL CONTROLS

         21. CMI shall, commencing on the date of lodging of the Consent Decree, provide the United States and the State, and their representatives, contractors, and subcontractors, with access at all reasonable times to the Site, or any other real property owned or controlled by CMI, where access and/or land and/or water use restrictions are needed, to conduct any activity regarding the Consent Decree including, but not limited to, the following activities:

a. Monitoring the Work;
b. Verifying any data or information submitted to the United States or the State;
c. Conducting investigations regarding contamination at or near the Site or other CMI Property;
d. Obtaining samples;
e. Assessing the need for, planning, or implementing additional response actions at or near the Site;
f Assessing implementation of quality assurance and quality control practices as defined in the approved CQAP;
g. Implementing the Work pursuant to the conditions set forth in Paragraph 84 (Work Takeover);
h. Inspecting and copying records, operating logs, contracts, or other documents maintained or generated by CMI or its agents, consistent with Section XXIII (Access to Information);
i. Assessing CMI's compliance with the Consent Decree; and
j. Determining whether the Site or other real property is being used in a manner that is prohibited or restricted, or that may need to be prohibited or restricted under the Consent Decree.

         22. Commencing on the date of lodging of the Consent Decree, CMI shall not use the Site, or any other real property owned or controlled by CMI, where access and/or land and/or water use restrictions are needed, in any manner that EPA or the State determines will pose an unacceptable risk to human health or to the environment due to exposure to Waste Material or interfere with or adversely affect the implementation, integrity, or protectiveness of the Remedial Action or O&M.

         23. If the Site, or any other real property where access and/or land and/or water use restrictions are needed, is owned or controlled by persons other than CMI, then CMI shall use best efforts to secure from such persons:

a. an agreement to provide access thereto for the United States, the State, and CMI, and their representatives, contractors, and subcontractors, to conduct any activity regarding the Consent Decree including, but not limited to, the activities listed in Paragraph 21; and
b. an agreement, enforceable by CMI and the United States and the State, to refrain from using the Site, or such other real property, in any manner that EPA or the State determines will pose an unacceptable risk to human health or to the environment due to exposure to Waste Material or interfere with or adversely affect the implementation, integrity, or protectiveness of the Remedial Action,

         24. For purposes of Paragraph 23, "best efforts" means the efforts that a reasonable person in the position of CMI would use so as to achieve the goal in a timely manner, including the cost of employing professional assistance and the payment of reasonable sums of money to obtain access or secure an agreement to restrict land/water use. If CMI is unable to accomplish what is required under Paragraph 23 in a timely manner, it shall notify the United States and the State in writing, and shall include in that notification a summary of the steps that CMI has taken to attempt to comply with Paragraph 23. The United States and the State may, as they deem appropriate, assist CMI or take independent action in obtaining access or agreements to restrict land/water use. CMI shall reimburse the United States or the State, as applicable, under Section XV (Payments for Response Costs) for all costs incurred, direct or indirect, by the United States or the State in obtaining such access or agreements to restrict land/water use, including, but not limited to, the cost of attorney time and the amount of monetary consideration or just compensation paid.

         25. If EPA determines in a decision document prepared in accordance with the NCP that Institutional Controls in the form of state or local laws, regulations, ordinances, zoning restrictions, or other governmental controls are needed at or in connection with the Site, CMI shall cooperate with EPA's and the State's efforts to secure and ensure compliance with such governmental controls.

         26. Notwithstanding any provision of the Consent Decree, the United States and the State retain all of their respective access authorities and rights, as well as all of their rights to require Institutional Controls, including enforcement authorities related thereto, under CERCLA, RCRA, and any other applicable federal statute or regulations, or under the WQA, the NMMA, State Regulations or State Permits.

         27. Nothing in this Decree shall be construed to prohibit, restrict, limit or otherwise affect the State's right or authority to access the Site as authorized by the WQA, the NMMA, State Regulations or State Permits.

         IX. REPORTING REQUIREMENTS

         28. In addition to any other requirement of this Consent Decree, CMI shall submit to EPA and the State, respectively, one copy of each written monthly progress report. Each such report shall be prepared in accordance with the requirements of Section 7.4 of the Statement of Work attached hereto as Appendix A. CMI shall submit these progress reports to EPA and the State by the fifteenth day of every month following the lodging of this Consent Decree until EPA notifies CMI pursuant to Paragraph 48.c of Section XIII (Certification of Completion). If requested by EPA or the State, CMI shall also provide briefings for EPA and the State to discuss the progress of the Work.

         29. CMI shall notify EPA and the State of any change in the schedule described in the monthly progress report for the performance of any activity, including, but not limited to, data collection and implementation of work plans, no later than seven days prior to the performance of the activity.

         30. Upon the occurrence of any event during performance of the Work that CMI is required to report pursuant to Section 103 of CERCLA, 42 U.S.C. § 9603, or Section 304 of the Emergency Planning and Community Right-to-know Act ("EPCRA"), 42 U.S.C. § 11004, CMI shall, within 24 hours of the onset of such event, orally notify the (i) EPA Project Coordinator or the Alternate EPA Project Coordinator (in the event of the unavailability of the EPA Project Coordinator), or, in the event that neither the EPA Project Coordinator nor Alternate EPA Project Coordinator is available, the Emergency Response Section, Region 6, United States Environmental Protection Agency, (ii) the NMED Project Coordinator and (iii) the MMD Project Coordinator. These reporting requirements are in addition to the reporting required by CERCLA Section 103 or EPCRA Section 304.

         31. Within 20 days after the onset of an event described in Paragraph 30, CMI shall furnish to EPA and the State a written report, signed by CMI's Project Coordinator, setting forth the events that occurred and the measures taken, and to be taken, in response thereto. Within 30 days after the conclusion of such an event, CMI shall submit a report to EPA and the State setting forth all actions taken in response thereto.

         32. CMI shall submit one copy of all plans, reports, data, and other deliverables required by the SOW, the Remedial Design Work Plan, the Remedial Action Work Plan, or any other approved plans to EPA in accordance with the schedules set forth in such plans. CMI shall simultaneously submit two copies of all such plans, reports, data, and other deliverables to the State. Upon request by EPA or the State, CMI shall submit to EPA or the State, as requested, in electronic form all or any portion of any deliverables CMI is required to submit pursuant to the provisions of this Consent Decree.

         33. All deliverables submitted by CMI to EPA that purport to document CMFs compliance with the terms of this Consent Decree shall be signed by an authorized representative of CMI.

         34. Nothing in this Section IX shall relieve CMI of any reporting obligations it has under the NMMA, the WQA, State Regulations or State Permits.

         X. EPA APPROVAL OF PLANS, REPORTS, AND OTHER DELIVERABLES

         35. Initial Submissions.

         a. After review of any plan, report, or other deliverable that is required to be submitted for approval pursuant to this Consent Decree, EPA, after reasonable opportunity for review and comment by the State, shall: (1) approve, in whole or in part, the submission; (2) approve the submission upon specified conditions; (3) disapprove, in whole or in part, the submission; or (4) any combination of the foregoing.

         b. EPA also may modify the initial submission to cure deficiencies in the submission if: (1) EPA determines that disapproving the submission and awaiting a resubmission would cause substantial disruption to the Work; or (2) previous submission(s) have been disapproved due to material defects and the deficiencies in the initial submission under consideration indicate a bad faith lack of effort to submit an acceptable plan, report, or deliverable.

         36. Resubmissions.

         Upon receipt of a notice of disapproval under Paragraph 35. a(3) or (4), or if required by a notice of approval upon specified conditions under Paragraph 35.a(2), CMI shall, within 30 days or such longer time as specified in the SOW or by EPA in writing, correct the deficiencies and resubmit to EPA and the State the plan, report, or other deliverable for approval. After review of the resubmitted plan, report, or other deliverable, EPA may: (a) approve, in whole or in part, the resubmission; (b) approve the resubmission upon specified conditions; (c) modify the resubmission; (d) disapprove, in whole or in part, the resubmission, requiring CMI to correct the deficiencies; or (e) any combination of the foregoing, 37. Material Defects.

         If an initially submitted or resubmitted plan, report, or other deliverable contains a material defect, and the plan, report, or other deliverable is disapproved or modified by EPA under Paragraph 35.b(2) or 36 due to such material defect, then the material defect shall constitute a lack of compliance for purposes of Paragraph 70. The provisions of Section XVIII (Dispute Resolution) and Section XIX (Stipulated Penalties) shall govern the accrual and payment of any stipulated penalties regarding CMI's submissions under this Section.

         38. Implementation.

         Upon approval, approval upon conditions, or modification by EPA under Paragraph 35 (Initial Submissions) or Paragraph 36 (Resubmissions), of any plan, report, or other deliverable, or any portion thereof: (a) such plan, report, or other deliverable, or portion thereof, shall be incorporated into and enforceable under this Consent Decree; and (b) CMI shall take any action required by such plan, report, or other deliverable, or portion thereof, subject only to its right to invoke the Dispute Resolution procedures set forth in Section XVIII (Dispute Resolution) with respect to the modifications or conditions made by EPA. The implementation of any non-deficient portion of a plan, report, or other deliverable submitted or resubmitted under Paragraph 35 or 36 shall not relieve CMI of any liability for stipulated penalties under Section XIX (Stipulated Penalties).

         XI. PROJECT COORDINATORS

         39. Within 20 days after lodging this Consent Decree, CMI, MMD, NMED and EPA will notify each other, in writing, of the name, address, telephone number, and email address of their respective designated Project Coordinators and Alternate Project Coordinators. If a Project Coordinator or Alternate Project Coordinator initially designated is changed, the identity of the successor will be given to the other Parties and the Parties' Project Coordinators at least five working days before the change occurs, unless impracticable, but in no event later than the actual day the change is made. CMFs Project Coordinator shall be subject to disapproval by EPA and shall have the technical expertise sufficient to adequately oversee all aspects of the Work. CMI's Project Coordinator shall not be an attorney for CMI in this matter. He or she may assign other representatives, including other contractors, to serve as a Site representative for oversight of performance of daily operations during remedial activities.

         40. EPA, NMED and MMD may designate other representatives, including, but not limited to EPA and State employees, and federal and State contractors and consultants, to observe and monitor the progress of any activity undertaken pursuant to this Consent Decree. EPA's Project Coordinator and Alternate Project Coordinator shall have the authority lawfully vested in a Remedial Project Manager and an On-Scene Coordinator by the NCP, 40 C.F.R. Part 300. EPA's Project Coordinator or Alternate Project Coordinator, consistent with the NCP, and NMED's and MMD's Project Coordinators shall have authority to halt any Work required by this Consent Decree and to take any necessary response action when he or she determines that conditions at the Site constitute an emergency situation or may present an immediate threat to public health or welfare or the environment due to release or threatened release of Waste Material.

         41. The Project Coordinator for CMI shall communicate at least weekly with the EPA Project Coordinator, either in face-to-face meetings, through conference calls, or through electronic mail, unless otherwise agreed to in writing, XII. PERFORMANCE GUARANTEE

         42. In order to ensure the full and final completion of the Work, CMI shall establish and maintain a performance guarantee, initially in the amount of $143, 632, 481, for the benefit of EPA (hereinafter "Estimated Cost of the Work"). The performance guarantee, which must be satisfactory in form and substance to EPA, shall be in the form of one or more of the following mechanisms (provided that, if CMI intends to use multiple mechanisms, such multiple mechanisms shall be limited to surety bonds guaranteeing payment, letters of credit, trust funds, and insurance policies):

a. A surety bond unconditionally guaranteeing payment and/or performance of the Work that is issued by a surety company among those listed as acceptable sureties on federal bonds as set forth in Circular 570 of the U.S. Department of the Treasury;
b. One or more irrevocable letters of credit, payable to or at the direction of EPA, that is issued by one or more financial institution(s) (1) that has the authority to issue letters of credit and (2) whose letter-of-credit operations are regulated and examined by a federal or state agency;
c. A trust fund established for the benefit of EPA that is administered by a trustee (1) that has the authority to act as a trustee and (2) whose trust operations are regulated and examined by a federal or state agency;
d. A policy of insurance that (1) provides EPA with acceptable rights as a beneficiary thereof; and (2) is issued by an insurance carrier (i) that has the authority to issue insurance policies in the applicable jurisdiction(s) and (ii) whose insurance operations are regulated and examined by a federal or state agency;
e. A demonstration by CMI that it meets the financial test criteria of 40 C.F.R. § 264.143(f) and reporting requirements of this Section for the sum of the Estimated Cost of the Work and the amounts, if any, of other federal, state, or tribal environmental obligations financially assured through the use of a financial test or guarantee; or
f. A guarantee to fund or perform the Work executed in favor of EPA by one or more of the following: (1) a direct or indirect parent company of CMI, or (2) a company that has a "substantial business relationship" (as defined in 40 C.F.R. § 264.141(h)) with CMI; provided, however, that any company providing such a guarantee must demonstrate to the satisfaction of EPA that it meets the relevant financial test criteria of 40 C.F.R. § 264.143(f) and reporting requirements of this Section for the sum of the Estimated Cost of the Work and the amounts, if any, of other federal, state, and tribal environmental obligations financially assured through the use of a financial test or guarantee.

         43. Initial Performance Guarantee.

         a. Notwithstanding the first sentence of Paragraph 42, the initial performance guarantee provided by CMI shall be established and maintained for the benefit of EPA and the State (through the NMED and the EMNRD). Until and unless CMI is notified in writing by EPA of a change in the name of the beneficiary, any revised or alternative performance guarantee provided by CMI pursuant to Paragraphs 45 or 47 shall also be for the benefit of EPA and the State and may not include a demonstration under Paragraph 42.e.

         b. CMI has selected, and EPA and the State have found satisfactory, as an initial performance guarantee, a written guarantee by Chevron Corporation, pursuant to Paragraph 42.f, attached hereto as Appendix B. Within 30 days after the Effective Date, CMI shall execute or otherwise finalize all instruments or other documents required in order to make the selected performance guarantee(s) legally binding in a form substantially identical to the documents attached hereto as Appendix B, and such performance guarantee shall thereupon be fully effective. Within 30 days after the Effective Date, CMI shall submit copies of all executed and/or otherwise finalized instruments or other documents required in order to make the selected performance guarantee legally binding to the EPA Regional Financial Management Officer in accordance with Section XXV. (Notices and Submissions), with a copy to Section Chief, Enforcement Assessment Section, Superfund Division, U.S. Environmental Protection Agency, Region 6, 1445 Ross Ave., Suite 1200, Dallas, TX 75202, and to the United States, EPA, and the State, as specified in Section XXV.

         44. If CMI provides financial assurance by means of a demonstration or guarantee pursuant to Paragraph 42.e or 42.f, CMI shall also comply and shall ensure that its guarantor complies with the other relevant criteria and requirements of 40 C.F.R. § 264.143(f)(3) (except (f)(3)(i) and the fourth sentence of (f)(10)) and this Section, including but not limited to: (a) the initial submission to EPA of required documents from the affected entity's chief financial officer and independent certified public accountant no later than 30 days after the Effective Date; (b) the annual resubmission of such reports and statements within 90 days after the close of each such entity's fiscal year; and (c) the notification of EPA no later than 30 days after any such entity determines that it no longer satisfies the financial test requirements set forth at 40 C.F.R. § 264.143(f)(1). CMI agrees that EPA may also, based on a belief that an affected entity may no longer meet the financial test requirements of Paragraph 42.e or 42.f, require reports of financial condition at any time from such entity in addition to those specified in this Paragraph. For purposes of this Section, references in 40 C.F.R. Part 264, Subpart H, to: the terms "current closure cost estimate, "current post-closure cost estimate, " and "current plugging and abandonment cost estimate" include the Estimated Cost of the Work; (2) "the sum of the current closure and post-closure cost estimates and the current plugging and abandonment cost estimates" mean the sum of all environmental obligations (including obligations under CERCLA, RCRA and any other federal, state, or tribal environmental obligation) guaranteed by such company or for which such company is otherwise financially obligated in addition to the Estimated Cost of Work under this Partial Consent Decree; (3) the terms "owner" and "operator" include CMI; and (d) the terms "facility" and "hazardous waste management facility" include the Site.

         45. In the event that EPA determines at any time that a performance guarantee provided by CMI pursuant to this Section is inadequate or otherwise no longer satisfies the requirements set forth in this Section, whether due to an increase in the estimated cost of completing the Work or for any other reason, or in the event that CMI becomes aware of information indicating that a performance guarantee provided pursuant to this Section is inadequate or otherwise no longer satisfies the requirements set forth in this Section, whether due to an increase in the estimated cost of completing the Work or for any other reason, CMI, within 30 days after receipt of notice of EPA's determination or, as the case may be, within 30 days after CMI becomes aware of such information, shall obtain and present to EPA and the State for approval a proposal for a revised or alternative form of performance guarantee listed in Paragraph 42 that satisfies all requirements set forth in this Section XII; provided, however, that if CMI cannot obtain such revised or alternative form of performance guarantee within such 30-day period, and provided further that CMI shall have commenced to obtain such revised or alternative form of performance guarantee within such 30-day period, and thereafter diligently proceeds to obtain the same, EPA shall extend such period for such time as is reasonably necessary for CMI in the exercise of due diligence to obtain such revised or alternative form of performance guarantee, such additional period not to exceed 30 days. In seeking approval for a revised or alternative form of performance guarantee, CMI shall follow the procedures set forth in Paragraph (2). CMI's inability to post a performance guarantee for completion of the Work shall in no way excuse performance of any other requirements of this Consent Decree, including, without limitation, the obligation of CMI to complete the Work in strict accordance with the terms of this Consent Decree.

         46. Funding for Work Takeover.

         The commencement of any Work Takeover pursuant to Paragraph 84 shall trigger EPA's right to receive the benefit of any performance guarantee(s) provided pursuant to Paragraphs 42.a, 42.b, 42.c, 42.d, or 42.f, and at such time EPA shall have immediate access to resources guaranteed under any such performance guarantee(s), whether in cash or in kind, as needed to continue and complete the Work assumed by EPA under the Work Takeover. Upon the commencement of any Work Takeover, if (a) for any reason EPA is unable to promptly secure the resources guaranteed under any such performance guarantee(s), whether in cash or in kind, necessary to continue and complete the Work assumed by EPA under the Work Takeover, or (b) in the event that the performance guarantee involves a demonstration of satisfaction of the financial test criteria pursuant to Paragraph 42.e or Paragraph 42.f(2), CMI (or in the case of Paragraph 42.f(2), the guarantor) shall immediately upon written demand from EPA deposit into a special account within the EPA Hazardous Substance Superfund or such other account as EPA may specify, in immediately available funds and without setoff, counterclaim, or condition of any kind, a cash amount up to but not exceeding the estimated cost of completing the Work as of such date, as determined by EPA. In addition, if at any time EPA is notified by the issuer of a performance guarantee that such issuer intends to cancel the performance guarantee mechanism it has issued, then, unless CMI provides a substitute performance guarantee mechanism in accordance with this Section XII no later than 30 days prior to the impending cancellation date, EPA shall be entitled (as of and after the date that is 30 days prior to the impending cancellation) to draw fully on the funds guaranteed under the then-existing performance guarantee. All EPA Work Takeover costs not reimbursed under this Paragraph shall be reimbursed under Section XV (Payments for Response Costs).

         47. Modification of Amount and/or Form of Performance Guarantee.

         a. Reduction of Amount of Performance Guarantee.

         If CMI believes that the estimated cost of completing the Work has diminished below the amount set forth in Paragraph 42, CMI may, no more than once during each calendar year after the first anniversary of the Effective Date, or at any other time agreed to by the Parties, petition EPA in writing to request a reduction in the amount of the performance guarantee provided pursuant to this Section so that the amount of the performance guarantee is equal to the estimated cost of completing the Work. CMI shall submit a written proposal for such reduction to EPA that shall specify, at a minimum, the estimated cost of completing the Work and the basis upon which such cost was calculated. In seeking approval for a reduction in the amount of the performance guarantee, CMI shall follow the procedures set forth in Paragraph 47. (2) for requesting a revised or alternative form of performance guarantee, except as specifically provided in this Paragraph 47.a. If EPA decides, after consultation with the State, to accept CMFs proposal for a reduction in the amount of the performance guarantee, either to the amount set forth in CMFs written proposal or to some other amount as selected by EPA, EPA will notify CMI of such decision in writing. Upon EPA's acceptance of a reduction in the amount of the performance guarantee, the Estimated Cost of the Work shall be deemed to be the estimated cost of completing the Work set forth in EPA's written decision. After receiving EPA's written decision, CMI may reduce the amount of the performance guarantee in accordance with and to the extent permitted by such written acceptance and shall submit copies of all executed and/or otherwise finalized instruments or other documents required in order to make the selected performance guarantee(s) legally binding in accordance with Paragraph 47. (2). In the event of a dispute, CMI may reduce the amount of the performance guarantee required hereunder only in accordance with a final administrative or judicial decision resolving such dispute pursuant to Section XVIII (Dispute Resolution). No change to the form or terms of any performance guarantee provided under this Section, other than a reduction in amount, is authorized except as provided in Paragraphs 45 or 47.b.

         b. Change of Form of Performance Guarantee, (1) If, after the Effective Date, CMI desires to change the form or terms of any performance guarantee(s) provided pursuant to this Section, CMI may, on any anniversary of the Effective Date, or at any other time agreed to by EPA and CMI, petition EPA and the State in writing to request a change in the form or terms of the performance guarantee provided hereunder. The submission of such proposed revised or alternative performance guarantee shall be as provided in Paragraph 47.b(2). Any decision made by EPA on a petition submitted under this Paragraph shall be made in EPA's sole and unreviewable discretion, and such decision shall not be subject to challenge by CMI pursuant to the dispute resolution provisions of this Consent Decree or in any other forum.

         (2) CMI shall submit a written proposal for a revised or alternative performance guarantee to EPA, MMD and NMED that shall specify, at a minimum, the estimated cost of completing the Work, the basis upon which such cost was calculated, and the proposed revised performance guarantee, including all proposed instruments or other documents required in order to make the proposed performance guarantee legally binding. The proposed revised or alternative performance guarantee must satisfy all requirements set forth or incorporated by reference in this Section. CMI shall submit such proposed revised or alternative performance guarantee to the EPA Regional Financial Management Officer in accordance with Section XXV (Notices and Submissions), with a copy to Section Chief, Enforcement Assessment Section, Superfund Division, U.S. Environmental Protection Agency, Region 6, 1445 Ross Ave., Suite 1200, Dallas, TX 75202. EPA will notify CMI in writing of its decision to accept or reject a revised or alternative performance guarantee submitted pursuant to this Paragraph. Within ten days after receiving a written decision approving the proposed revised or alternative performance guarantee, CMI shall execute and/or otherwise finalize all instruments or other documents required in order to make the selected performance guarantee(s) legally binding in a form substantially identical to the documents submitted to EPA as part of the proposal, and such performance guarantee(s) shall thereupon be fully effective. CMI shall submit copies of all executed and/or otherwise finalized instruments or other documents required in order to make the selected performance guarantee(s) legally binding to the EPA Regional Financial Management Officer in accordance with Section XXV (Notices and Submissions) within 30 days after receiving a written decision approving the proposed revised or alternative performance guarantee, with a copy to Section Chief, Enforcement Assessment Section, Superfund Division, U.S. Environmental Protection Agency, Region 6, 1445 Ross Ave., Suite 1200, Dallas, TX 75202, and to the United States, EPA and the State as specified in Section XXV.

         c. Release of Performance Guarantee.

         CMI shall not release, cancel, or discontinue any performance guarantee provided pursuant to this Section except as provided in this Paragraph. If CMI receives written notice from EPA in accordance with Paragraph 48 that the Work has been fully and finally completed in accordance with the terms of this Consent Decree, or if EPA otherwise so notifies CMI in writing, CMI may thereafter release, cancel, or discontinue the performance guarantee(s) provided pursuant to this Section. In the event of a dispute, CMI may release, cancel, or discontinue the performance guarantee(s) required hereunder only in accordance with a final administrative or judicial decision resolving such dispute pursuant to Section XVIII (Dispute Resolution).

         XIII. CERTIFICATION OF COMPLETION

         48. Completion of the Work.

         a. Within 90 days after CMI concludes that all phases of the Work have been fully performed, CMI shall schedule and conduct a pre-certification inspection to be attended by CMI, EPA and the State. If, after the pre-certification inspection, CMI still believes that the Work has been fully performed, CMI shall submit to EPA and the State a written report by a registered professional engineer stating that the Work has been completed in full satisfaction of the requirements of this Consent Decree. The report shall contain the following statement and be signed by a responsible corporate official of CMI or CMFs Project Coordinator:

I certify under penalty of law that this document and all attachments were prepared under my direction or supervision in accordance with a system designed to assure that qualified personnel properly gather and evaluate the information submitted. Based on my inquiry of the person or persons who manage the system, or those persons directly responsible for gathering the information, the information submitted is, to the best of my knowledge and belief, true, accurate, and complete. I am aware that there are significant penalties for submitting false information, including the possibility of fine and imprisonment for knowing violations.

         b. If, after review of the written report, EPA, after reasonable opportunity for review, inspection and comment by the State, determines that any portion of the Work has not been completed in accordance with this Consent Decree, EPA will notify CMI in writing of the activities that must be undertaken by CMI pursuant to this Consent Decree to complete the Work, provided, however, that EPA may only require CMI to perform such activities pursuant to this Paragraph to the extent that such activities are consistent with the "scope of the remedy set forth in the ROD, " as that term is defined in Paragraph 14.a. EPA will set forth in the notice a schedule for performance of such activities consistent with the Consent Decree and the-SOW or require CMI to submit a schedule to EPA and the State for EPA's approval pursuant to Section X (EPA Approval of Plans, Reports, and Other Deliverables). CMI shall perform all activities described in the notice in accordance with the specifications and schedules established therein, subject to its right to invoke the dispute resolution procedures set forth in Section XVIII (Dispute Resolution).

         c. If EPA concludes, based on the initial or any subsequent request for Certification of Completion of the Work by CMI and after a reasonable opportunity for review, inspection and comment by the State, that the Work has been performed in accordance with this Consent Decree, EPA will so notify CMI in writing.

         XIV. EMERGENCY RESPONSE

         49. If any event occurs during the performance of the Work that causes or threatens a release of Waste Material on, at or from the Site and either constitutes an emergency situation or may present an immediate threat to public health or welfare or the environment, CMI shall, subject to Paragraph 50, immediately take all appropriate actions to prevent, abate, or minimize such release or threat of release, and shall immediately notify EPA's Project Coordinator, or, if the Project Coordinator is unavailable, EPA's Alternate Project Coordinator. If neither of these persons is available, CMI shall notify the EPA Response and Prevention Branch, Region 6, at 866-372-7745. In addition, CMI shall notify the National Response Center at 800-424-8802 as well as NMED's Project Coordinator and MMD's Project Coordinator. CMI shall take such actions in consultation with EPA's Project Coordinator or other available authorized EPA officer and in accordance with all applicable provisions of the Health and Safety Plans, the Contingency Plans, and any other applicable plans or documents developed pursuant to the SOW. In the event that CMI fails to take appropriate response action as required by this Section, and EPA or, as appropriate, the State takes such action instead, CMI shall reimburse EPA and the State all costs of the response action under Section XV (Payments for Response Costs).

         50. Subject to Section XX (Covenants by Plaintiffs), nothing in the preceding Paragraph or in this Consent Decree shall be deemed to limit any authority of the United States, or the State, (a) to take all appropriate action to protect human health and the environment or to prevent, abate, respond to, or minimize an actual or threatened release of Waste Material on, at, or from the Site, or (b) to direct or order such action, or seek an order from the Court, to protect human health and the environment or to prevent, abate, respond to, or minimize an actual or threatened release of Waste Material on, at, or from the Site.

         XV. PAYMENTS FOR RESPONSE COSTS

         51. Payment by CMI for the United States' Past Response Costs.

         a. Within 45 days after the Effective Date, CMI shall pay to EPA $5, 269, 949.78 in payment for Past Response Costs. Payment shall be made in accordance with Paragraphs 53.a (Instructions for Past Response Cost Payments).

         b. The total amount to be paid by CMI pursuant to Paragraph 51 .a shall be deposited by EPA in the Chevron Questa Mine Superfund Site Special Account to be retained and used to conduct or finance response actions at or in connection with the Site, or to be transferred by EPA to the EPA Hazardous Substance Superfund.

         52. Payments by CMI for Future Response Costs.

         CMI shall pay to EPA all Future Response Costs not inconsistent with the NCP.

         a. On a periodic basis, EPA will send CMI a bill requiring payment that includes a Certified Cost Documentation Package (which includes direct and indirect costs incurred by EPA, its contractors, the State and DOJ). CMI shall make all payments within 45 days after CMI's receipt of each bill requiring payment, except as otherwise provided in Paragraph 54, in accordance with Paragraphs 53.b (Instructions for Future Response Cost Payments).

         b. CMI shall receive a credit of $ 1, 810, 000 to reflect prepayment previously made to EPA under the Removal AOC (EPA Docket No. 06-09-12) and the Early Design AOC (EPA Docket No. 06-13-12). If the first bill under paragraph 52.a. is less than $1, 810, 000, the remaining credit shall apply to succeeding bills issued under paragraph 52.a.

         c. The total amount to be paid by CMI to EPA pursuant to Paragraph 52.a. shall be deposited by EPA in the Chevron Questa Mine Superfund Site Special Account to be retained and used to conduct or finance response actions at or in connection with the Site, or to be transferred by EPA to the EPA Hazardous Substance Superfund.

         d. This Consent Decree shall supersede the requirements of Paragraph 43 of the Removal AOC and Paragraph 52 of the Early Design AOC.

         53. Payment Instructions for CMI Payments to EPA.

         a. Instructions for Past Response Costs Payments.

         All payments to EPA required elsewhere in this Consent Decree to be made in accordance with this Paragraph 53.a shall be made at https://www.pay.gov to the U.S. Department of Justice account, in accordance with instructions provided to CMI by the Financial Litigation Unit ("FLU") of the United States Attorney's Office for the District of New Mexico after the Effective Date. Any payments exceeding $9.9 million and required, elsewhere in this Consent Decree, to be made in accordance with this Paragraph, may be made by Fedwire Electronic Funds Transfer ("EFT") to the U.S. Department of Justice account in accordance with current EFT procedures, and in accordance with instructions provided to CMI by the FLU after the Effective Date. The payment instructions provided by the Financial Litigation Unit shall include a Consolidated Debt Collection System ("CDCS") number, which shall be used to identify all payments required to be made in accordance with this Consent Decree. The FLU shall provide the payment instructions to:

Chevron Environmental Management Company ATTN: Michael D. Coats, Questa Project Manager 345 State Road 38 P.O. Box 469 Questa, NM 87556 (575) 586-7507 MichaelCoats@chevron.com

         on behalf of CMI. CMI may change the individual to receive payment instructions on its behalf by providing written notice of such change in accordance with Section XXV (Notices and Submissions). When making payments under this Paragraph 53.a, CMI shall also comply with Paragraph 53.c.

         b. Instructions for Future Response Costs Payments and Stipulated Penalties.

         All payments to EPA required, elsewhere in this Consent Decree, to be made in accordance with this Paragraph 53.b shall be made by Fedwire EFT to:

Federal Reserve Bank of New York
ABA = 021030004
Account = 68010727
SWIFT address = FRNYUS33
33 Liberty Street
New York NY 10045
Field Tag 4200 of the Fedwire message should read:
"D 68010727 Environmental Protection Agency"

         When making payments under this Paragraph 53.b, CMI shall also comply with Paragraph 53.c.

         c. Instructions for All Payments.

         All payments to EPA made under Paragraphs 53.a (Instructions for Past Response Cost Payments) or 53.b (Instructions for Future Response Cost Payments and Stipulated Penalties) shall reference the CDCS Number, Site/Spill ID Number 06DL, and DOJ Case Number 90-11-3-10261. At the time of any payment required to be made in accordance with Paragraphs 53.a or 53.b, CMI shall send notice that payment has been made to the United States in accordance with Section XXV (Notices and Submissions), to the EPA Cincinnati Finance Center by email at acctsreceivable.cinwd@epa.gov, by U.S. mail to 26 Martin Luther King Drive, Cincinnati, Ohio 45268, and to Section Chief, Enforcement Assessment Section, Superfund Division, U.S. Environmental Protection Agency, Region 6, 1445 Ross Avenue, Suite 1200, Dallas, TX 75202. Such notice shall also reference the CDCS Number, Site/Spill ID Number, and DOJ Case Number.

         54. Instructions for stipulated penalty payments to the State.

         Any stipulated penalty payments payable under Section XIX to NMED shall be made by certified or cashier's checks payable to "State of New Mexico" and referencing the Chevron Questa Mine Superfund Site and shall be sent to:

Director, Water Protection Division New Mexico Environment Department Post Office Box 5469 Santa Fe, New Mexico 87502-5469

         A copy of the check and transmittal letter shall be sent to counsel for NMED.

         Any stipulated penalty payments payable under Section XIX to EMNRD shall be made by certified or cashier's checks payable to "State of New Mexico" and referencing the Chevron Questa Mine Superfund Site and shall be sent to:

Director, Mining and Minerals Division, New Mexico Energy, Minerals and Natural Resources Department 1220 South St. Francis Drive Santa Fe, New Mexico 87505

         A copy of the check and transmittal letter shall be sent to counsel for EMNRD.

         55. CMI may contest any Future Response Costs billed under Paragraph 52 (Payments by CMI for Future Response Costs) if it determines that EPA or the State has made a mathematical error or included a cost item that is not within the definition of Future Response Costs, or if it believes EPA or the State incurred excess costs as a direct result of an EPA or State action that was inconsistent with a specific provision or provisions of the NCP. Such objection shall be made in writing within 45 days after receipt of the bill and must be sent to the United States and the State pursuant to Section XXV (Notices and Submissions). Any such objection shall specifically identify the contested Future Response Costs and the basis for objection. In the event of an objection, CMI shall pay all uncontested Future Response Costs to the United States within 45 days after CMI's receipt of the bill requiring payment. Simultaneously, CMI shall establish, in a duly chartered bank or trust company, an interest-bearing escrow account that is insured by the Federal Deposit Insurance Corporation ("FDIC"), and remit to that escrow account funds equivalent to the amount of the contested Future Response Costs. CMI shall send to the United States, as provided in Section XXV (Notices and Submissions), a copy of the transmittal letter and (i) a check paying the uncontested Future Response Costs, (ii) a copy of the correspondence that establishes and funds the escrow account, including, but not limited to, information containing the identity of the bank and bank account under which the escrow account is established and (iii) a bank statement showing the initial balance of the escrow account. Simultaneously with establishment of the escrow account, CMI shall initiate the Dispute Resolution procedures in Section XVIII (Dispute Resolution). If the United States prevails in the dispute, CMI shall pay the sums due (with accrued Interest) to the United States within five working days after the resolution of the dispute. If CMI prevails concerning any aspect of the contested costs, CMI shall pay that portion of the costs (plus associated accrued Interest) for which it did not prevail to the United States, within five working days after the resolution of the dispute. CMI shall be disbursed any balance of the escrow account. All payments to the United States under this Paragraph shall be made in accordance with Paragraphs 53.b (Instructions for Future Response Costs Payments and Stipulated Penalties). The dispute resolution procedures set forth in this Paragraph in conjunction with the procedures set forth in Section XVIII (Dispute Resolution) shall be the exclusive mechanisms for resolving disputes regarding CMPs obligation to reimburse the United States and the State for their Future Response Costs.

         56. Interest.

         In the event that any payment for Past Response Costs or for Future Response Costs required under this Section is not made by the date required, CMI shall pay Interest on the unpaid balance. The Interest to be paid on Past Response Costs under this Paragraph shall begin to accrue on the Effective Date. The Interest on all subsequent Future Response Costs shall begin to accrue on the date of the bill. The Interest shall accrue through the date of CMI's payment. Payments of Interest made under this Paragraph shall be in addition to such other remedies or sanctions available to EPA or the State by virtue of CMI's failure to make timely payments under this Section including, but not limited to, payment of stipulated penalties pursuant to Paragraph 72.

         XVI. INDEMNIFICATION AND INSURANCE

         57. CMI's Indemnification of the United States and the State.

         a. The United States and the State do not assume any liability by entering into this Consent Decree or by virtue of any designation of CMI as EPA's authorized representatives under Section 104(e) of CERCLA, 42 U.S.C. § 9604(e). CMI shall indemnify, save and hold harmless the United States, the State, and their officials, agents, agencies, employees, contractors, subcontractors, and representatives for or from any and all claims or causes of action arising from, or on account of, negligent or other wrongful acts or omissions of CMI, its officers, directors, employees, agents, agencies, contractors, subcontractors, invitees and any persons acting on its behalf or under its control, in carrying out activities pursuant to this Consent Decree, including, but not limited to, any claims arising from any designation of CMI as EPA's authorized representatives under Section 104(e) of CERCLA. Further, CMI agrees to pay the United States and the State all costs it incurs including, but not limited to, attorneys' fees and other expenses of litigation and settlement arising from, or on account of, claims made against the United States or the State based on negligent or other wrongful acts or omissions of CMI, its officers, directors, employees, agents, agencies, contractors, subcontractors, and any persons acting on its behalf or under its control, in carrying out activities pursuant to this Consent Decree. Neither the United States nor the State shall be held out as a party to any contract entered into by or on behalf of CMI in carrying out activities pursuant to this Consent Decree. Neither CMI nor any such contractor shall be considered an agent of the United States or the State.

         b. The United States and the State shall give CMI notice of any claim for which the United States or the State plans to seek indemnification pursuant to this Paragraph 57, and shall consult with CMI prior to settling such claim.

         58. CMI covenants not to sue and agrees not to assert any claims or causes of action against the United States and the State, respectively, for damages or reimbursement or for set-off of any payments made or to be made to the United States or the State, arising from or on account of any contract, agreement, or arrangement between any CMI and any person for performance of the Work on or relating to the Site, including, but not limited to, claims on account of construction delays. In addition, CMI shall indemnify and hold harmless the United States and the State with respect to any and all claims for damages or reimbursement arising from or on account of any contract, agreement, or arrangement between CMI and any person for performance of the Work on or relating to the Site, including, but not limited to, claims on account of construction delays.

         59. No later than 15 days before commencing any on-site Work, CMI shall secure, and shall maintain until the first anniversary after the issuance of EPA's Certification of Completion of the Work pursuant to Paragraph 48.c, commercial general liability insurance with limits of $2 million dollars, for any one occurrence, and automobile liability insurance with limits of $2 million dollars, combined single limit, naming the United States and the State as additional insureds with respect to all liability arising out of the activities performed by or on behalf of CMI pursuant to this Consent Decree. In addition, for the duration of this Consent Decree, CMI shall satisfy, or shall ensure that its contractors or subcontractors satisfy, all applicable laws and regulations regarding the provision of worker's compensation insurance for all persons performing the Work on behalf of CMI in furtherance of this Consent Decree. Prior to commencement of the Work under this Consent Decree, CMI shall provide to EPA and the State certificates of such insurance and a copy of each insurance policy. CMI shall resubmit such certificates and copies of policies each year on the anniversary of the Effective Date. If CMI demonstrates by evidence satisfactory to EPA and the State that any contractor or subcontractor maintains insurance equivalent to that described above, or insurance covering the same risks but in a lesser amount, then, with respect to that contractor or subcontractor, CMI need provide only that portion of the insurance described above that is not maintained by the contractor or subcontractor.

         XVII. FORCE MAJEURE

         60. "Force majeure, " for purposes of this Consent Decree, is defined as any event arising from causes beyond the control of CMI, of any entity controlled by CMI, or of CMP s contractors that delays or prevents the performance of any obligation under this Consent Decree despite CMFs best efforts to fulfill the obligation. The requirement that CMI exercise '"best efforts to fulfill the obligation" includes using best efforts to anticipate any potential force majeure and best efforts to address the effects of any potential force majeure (a) as it is occurring and (b) following the potential force majeure such that the delay and any adverse effects of the delay are minimized to the greatest extent possible. "Force majeure" does not include financial inability to complete the Work or a failure to achieve the Performance Standards.

         61. If any event occurs or has occurred that may delay the performance of any obligation under this Consent Decree for which CMI intends or may intend to assert a claim of force majeure, CMI shall notify EPA's Project Coordinator orally or, in his or her absence, EPA's Alternate Project Coordinator or, in the event both of EPA's designated representatives are unavailable, the Director of the Superfund Division, EPA Region 6, within 72 hours of when CMI first knew that the event might cause a delay. Within ten working days of when CMI first knew the event might cause a delay, CMI shall provide in writing to EPA and the State an explanation and description 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; a schedule for implementation of any measures to be taken to prevent or mitigate the delay or the effect of the delay; CMI's rationale for attributing such delay to a force majeure; and a statement as to whether, in the opinion of CMI, such event may cause or contribute to an endangerment to public health or welfare, or the environment. CMI shall include with any notice all available documentation supporting its claim that the delay was attributable to a force majeure. CMI shall be deemed to know of any circumstance of which CMI, any entity controlled by CMI, or CMI's contractors knew or should have known. Failure to comply with the above requirements regarding an event shall preclude CMI from asserting any claim offeree majeure regarding that event, provided, however, that if EPA, despite the late notice, is able to assess to its satisfaction whether the event is a force majeure under Paragraph 60 and whether CMI has exercised its best efforts under Paragraph 60, EPA may, in its unreviewable discretion, excuse in writing CMI's failure to submit timely notices under this Paragraph.

         62. If EPA, after a reasonable opportunity for review and comment by the State, agrees that the delay or anticipated delay is attributable to a force majeure, the time for performance of the obligations under this Consent Decree that are affected by the force majeure will be extended by EPA, after a reasonable opportunity for review and comment by the State, for such time as is necessary to complete those obligations. An extension of the time for performance of the obligations affected by the force majeure shall not, of itself, extend the time for performance of any other obligation. If EPA, after a reasonable opportunity for review and comment by the State, does not agree that the delay or anticipated delay has been or will be caused by a force majeure, EPA will notify CMI in writing of its decision. If EPA, after a reasonable opportunity for review and comment by the State, agrees that the delay is attributable to a force majeure, EPA will notify CMI in writing of the length of the extension, if any, for performance of the obligations affected by the force majeure.

         63. If CMI elects to invoke the dispute resolution procedures set forth in Section XVIII (Dispute Resolution), it shall do so no later than 15 days after receipt of EPA's notice. In any such proceeding, CMI 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, that the duration of the delay or the extension sought was or will be warranted under the circumstances, that best efforts were exercised to avoid and mitigate the effects of the delay, and that CMI complied with the requirements of Paragraphs 60 and 61. If CMI carries this burden, the delay at issue shall be deemed not to be a violation by CMI of the affected obligation of this Consent Decree identified to EPA and the Court.

         XVIII. DISPUTE RESOLUTION

         64. Unless otherwise expressly provided for in this Consent Decree, the dispute resolution procedures of this Section shall be the exclusive mechanism to resolve disputes regarding this Consent Decree or its implementation. However, the procedures set forth in this Section shall not apply to actions by the United States or the State to enforce obligations of CMI that have not been disputed in accordance with this Section. Moreover, nothing in this Section shall affect the dispute resolution procedures set forth in the WQA, the NMMA, State Regulations, or State Permits, as they may apply to disputes that are not regarding this Consent Decree or its implementation.

         65. Any dispute regarding this Consent Decree or its implementation shall in the first instance be the subject of informal negotiations between the parties to the dispute. The period for informal negotiations shall not exceed 20 days from the time the dispute arises, unless it is modified by written agreement of the parties to the dispute. The dispute shall be considered to have arisen when one party sends the other parties a written Notice of Dispute.

         66. Statements of Position.

         In the event that the parties cannot resolve a dispute by informal negotiations under the preceding Paragraph, then the position advanced by EPA (or, in disputes involving the State and CMI exclusively, the State) shall be considered binding unless, within 14 days after the conclusion of the informal negotiation period, CMI invokes the formal dispute resolution procedures of this Section by serving on the United States and the State 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 CMI. The Statement of Position shall specify CMI's position as to whether formal dispute resolution should proceed under Paragraph 67 (Record Review) or Paragraph 68.

         a. Within 30 days after receipt of CMI's Statement of Position, EPA (or the State, as appropriate) will serve on CMI 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 EPA. This Statement of Position shall include a statement as to whether formal dispute resolution should proceed under Paragraph 67 (Record Review) or Paragraph 68. Within 30 days after receipt of EPA's (or the State's) Statement of Position, CMI may submit a Reply.

         b. If there is disagreement between EPA (or the State, as appropriate) and CMI as to whether dispute resolution should proceed under Paragraph 67 (Record Review) or Paragraph 68, the parties to the dispute shall follow the procedures set forth in the paragraph determined by EPA to be applicable. However, if CMI ultimately appeals to the Court to resolve the dispute, the Court shall determine which paragraph is applicable in accordance with the standards of applicability set forth in Paragraphs 67 and 68.

         67. Record Review.

         Formal dispute resolution for disputes pertaining to the selection or adequacy of any response action and all other disputes that are accorded review on the administrative record under applicable principles of administrative law shall be conducted pursuant to the procedures set forth in this Paragraph. For purposes of this Paragraph, the adequacy of any response action includes, without limitation, the adequacy or appropriateness of plans, procedures to implement plans, or any other items requiring approval by EPA under this Consent Decree, and the adequacy of the performance of response actions taken pursuant to this Consent Decree. Nothing in this Consent Decree shall be construed to allow any dispute by CMI regarding the validity of the ROD's provisions.

         a. An administrative record of the dispute shall be maintained by EPA and shall contain all statements of position, including supporting documentation, submitted pursuant to this Section. Where appropriate, EPA may allow submission of supplemental statements of position by the parties to the dispute.

         b. The Director of the Superfund Division, EPA Region 6, will issue a final administrative decision resolving the dispute based on the administrative record described in Paragraph 67.a. This decision shall be binding upon CMI, subject only to the right to seek judicial review pursuant to Paragraphs 67.c and 67.d.

         c. Any administrative decision made by EPA pursuant to Paragraph 67.b shall be reviewable by this Court, provided that a motion for judicial review of the decision is filed by CMI with the Court and served on all Parties within ten days after receipt of EPA's decision. The motion shall include a description of the matter in dispute, the efforts made by the parties to resolve it, the relief requested, and the schedule, if any, within which the dispute must be resolved to ensure orderly implementation of this Consent Decree. The United States may file a response to CMPs motion.

         d. In proceedings on any dispute governed by this Paragraph, CMI shall have the burden of demonstrating that the decision of the Superfund Division Director is arbitrary and capricious or otherwise not in accordance with law. Judicial review of EPA's decision shall be on the administrative record maintained pursuant to Paragraph 67, a.

         68. Formal dispute resolution for disputes that neither pertain to the selection or adequacy of any response action nor are otherwise accorded review on the administrative record under applicable principles of administrative law, shall be governed by this Paragraph.

         a. Following receipt of CMP s Statement of Position submitted pursuant to Paragraph 66, the Director of the Superfund Division, EPA Region 6, will issue a final decision resolving the dispute. The Superfund Division Director's decision shall be binding on CMI unless, within ten days after receipt of the decision, CMI files with the Court and serves on the parties a motion for judicial review of the decision setting forth the matter in dispute, the efforts made by the parties to resolve it, the relief requested, and the schedule, if any, within which the dispute must be resolved to ensure orderly implementation of the Consent Decree. The United States may file a response to CMI's motion.

         b. Notwithstanding Paragraph P (CERCLA Section 113(j) Record Review of ROD and Work) of Section I (Background), above, judicial review of any dispute governed by this Paragraph shall be governed by applicable principles of law.

         69. The invocation of formal dispute resolution procedures under this Section shall not extend, postpone, or affect in any way any obligation of CMI under this Consent Decree, not directly in dispute, unless EPA or the Court agrees otherwise. Stipulated penalties with respect to the s disputed matter shall continue to accrue but payment shall be stayed pending resolution of the dispute as provided in Paragraph 77. Notwithstanding the stay of payment, stipulated penalties shall accrue from the first day of noncompliance with any applicable provision of this Consent Decree. In the event that CMI does not prevail on the disputed issue, stipulated penalties shall be assessed and paid as provided in Section XIX (Stipulated Penalties).

         XIX. STIPULATED PENALTIES

         70. CMI shall be liable for stipulated penalties in the amounts set forth in Paragraphs 72 and 73 to the United States and the State, divided equally, for CMI's failure to comply with the requirements of this Consent Decree specified below, unless excused under Section XVII (Force Majeure). "Compliance" by CMI shall include completion of all payments and activities required under this Consent Decree, or any plan, report, or other deliverable approved under this Consent Decree, in accordance with all applicable requirements of law, this Consent Decree, the SOW, and any plans, reports, or other deliverables approved under this Consent Decree and within the specified time schedules established by and approved under this Consent Decree.

         71. The assessment or collection of penalties pursuant to this Section XIX shall not relieve CMI of its obligation to pay penalties assessed by the State pursuant to State law, including without limitation, the NMMA, the WQA, State Regulations or State Permits, provided, however, that the State shall not seek penalties under State law for any violation that is also subject to a stipulated penalty under this Section XIX. All parties reserve their rights and defenses with respect to any penalties assessed by the State relating to the Site.

         72. Stipulated Penalty Amounts.

         a. Stipulated Penalty Amounts - Other Than Monthly Progress Reports. The following stipulated penalties shall accrue per violation per day for each failure to complete a deliverable in a timely manner or produce a deliverable of acceptable quality, or for any other noncompliance with this Consent Decree with the exception of monthly progress reports as described in Paragraph b:

Penalty Per Violation Per Day Period of Noncompliance
$1000 1st through 14th day
$2000 15th through 30th day
$4, 250 31 st day and beyond

         b. Stipulated Penalty Amounts - Monthly Progress Reports.

         The following stipulated penalties shall accrue per violation per day for failure to submit timely or adequate monthly progress reports pursuant to Paragraph 28:

Penalty Per Violation

Per Day Period of Noncompliance

$500

1st through 14th day

$ 1000

15th through 3 0th day

$2500

31 st day and beyond

         73. In the event that EPA assumes performance of a portion or all of the Work pursuant to Paragraph 84 (Work Takeover), CMI shall be liable for a stipulated penalty in the amount of $750, 000. Stipulated penalties under this Paragraph are in addition to the remedies available under Paragraphs 46 (Funding for Work Takeover) and 84 (Work Takeover).

         74. All penalties shall begin to accrue on the day after the complete performance is due or the day a violation occurs and shall continue to accrue through the final day of the correction of the noncompliance or completion of the activity. However, stipulated penalties shall not accrue: (a) with respect to a deficient submission under Section X (EPA Approval of Plans, Reports, and Other Deliverables), during the period, if any, beginning on the 31st day after EPA's receipt of such submission until the date that EPA notifies CMI of any deficiency; (b) with respect to a decision by the Director of the Superfund Division, EPA Region 6, under Paragraph 67.b or 68.a of Section XVIII (Dispute Resolution), during the period, if any, beginning on the 21st day after the date that CMI's reply to EPA's Statement of Position is received until the date that the Director issues a final decision regarding such dispute; or (c) with respect to judicial review by this Court of any dispute under Section XVIII (Dispute Resolution), during the period, if any, beginning on the 31st day after the Court's receipt of the final submission regarding the dispute until the date that the Court issues a final decision regarding such dispute. Nothing in this Consent Decree shall prevent the simultaneous accrual of separate penalties for separate violations of this Consent Decree, 75. Following EPA's determination that CMI has failed to comply with a requirement of this Consent Decree, EPA may give CMI written notification of the same and describe the noncompliance. EPA and the State may send CMI a written demand for the payment of the penalties. However, penalties shall accrue as provided in the preceding Paragraph regardless of whether EPA has notified CMI of a violation.

         76. All penalties accruing under this Section shall be due and payable to the United States and the State within 45 days after CMI's receipt from EPA of a demand for payment of the penalties, unless CMI invokes the Dispute Resolution procedures under Section XVIII (Dispute Resolution) within the 45-day period. All payments to the United States under this Section shall indicate that the payment is for stipulated penalties and shall be made in accordance with Paragraph 53.b (Instructions for Future Response Cost Payments and Stipulated Penalties). All payments to the State under this Section shall indicate that the payment is for stipulated penalties and shall be made in accordance with Paragraph 54 (Instructions for stipulated penalty payment to the State).

         77. Penalties shall continue to accrue as provided in Paragraph 74 during any dispute resolution period, but need not be paid until the following:

a. If the dispute is resolved by agreement of the Parties or by a decision of EPA that is not appealed to this Court, accrued penalties determined to be owed shall be paid to EPA and the State within 30 days after the agreement or the receipt of EPA" s decision or order;
b. If the dispute is appealed to this Court and the United States prevails in whole or in part, CMI shall pay all accrued penalties determined by the Court to be owed to EPA and the State within 60 days after receipt of the Court's decision or order, except as provided in Paragraph 77.c;
c. If the District Court's decision is appealed by any Party, CMI shall pay all accrued penalties determined by the District Court to be owed to the United States and the State into an interest-bearing escrow account, established at a duly chartered bank or trust company that is insured by the FDIC, within 60 days after receipt of the Court's decision or order. Penalties shall be paid into this account as they continue to accrue, at least every 60 days. Within 15 days after receipt of the final appellate court decision, the escrow agent shall pay the balance of the account to EPA and the State or to CMI to the extent that it prevails.

         78. If CMI fails to pay stipulated penalties when due, CMI shall pay Interest on the unpaid stipulated penalties as follows: (a) if CMI has timely invoked dispute resolution such that the obligation to pay stipulated penalties has been stayed pending the outcome of dispute resolution, Interest shall accrue from the date stipulated penalties are due pursuant to Paragraph 77 until the date of payment; and (b) if CMI fails to timely invoke dispute resolution, Interest shall accrue from the date of demand under Paragraph 76 until the date of payment. If ...


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