Indiana Law Review


Indiana Environmental Law: An Examination of 1989
Legislationt

Thomas R. Newby*
Stanley H. Rorick**

Kevin W. Betz***
Timothy L. Tyler****

I. Introduction

The 1989 session of the Indiana General Assembly has been called

'The Year of the Environment.'" That appears to be an apt label.

More environmental legislation was enacted in 1989 than in any year

t The 1990 Indiana General Assembly passed a number of significant environ-

mental bills which, due to time constraints imposed by the publication date of this article,

cannot be analyzed in detail here. The authors have attempted to footnote important

changes made during the 1990 session to legislation discussed in this article; however,

indepth discussion of the other 1990 legislation must be deferred until a later issue.
* Staff Attorney, Indiana Department of Environmental Management, Indiana-

polis. B.A., Indiana University, 1972; J.D. Indiana University School of Law—Bloom-
ington, 1987.

** Staff Attorney, Indiana Department of Environmental Management, Indiana-

polis. B.S., Indiana University, 1981; J.D., Indiana University School of Law—Bloom-
ington, 1987.

*** Law Clerk for Chief Justice Randall T. Shepard, Indiana Supreme Court.
B.A., Indiana University, 1982; M.S., Northwestern University, 1984; J.D., Indiana Uni-

versity School of Law—Bloomington 1988.
**** Senior Staff Attorney, Indiana Legislative Services Agency, IndianapoUs. B.A.,

Indiana University, 1981; J.D., Indiana University School of Law—Bloomington, 1986.
Mr. Tyler's participation in compiling and explaining the enactments of the 1989 Indiana

Legislature was invaluable; however, because of his position with the Legislative Services

Agency, his contribution was mainly hmited to sections II D through II H and section
III. He did not take part in those portions of this Article which include critical analysis
of the legislation.

1. Newland, House Republicans to Back Death Penalty in Drug Killings, Indi-
anapoUs Star, Jan. 5, 1989, at A-8, col. 1 ("[P]erhaps the most important issue we will

address in the next four to five years [is the environment]. If we fail to provide long-
term solutions to such critical problems as leaking underground storage tanks, the proper

disposal of hazardous waste and the reduction of solid waste, we will seriously jeopardize
the quality of life on this planet, not only for our children, but for our children's children."

Quoting Indiana House of Representatives Co-Speaker Paul Mannweiler.)

"After years of introducing environmental protection bills that drew skepticism and

sometimes outright ridicule from other legislators, State Sen. Vi Simpson finds herself

being treated differently this year," Indianapolis Star, Dec. 31, 1988, at A-1, col. 1.

329



330 INDIANA LAW REVIEW [Vol. 23:329

in recent memory.^ This legislative activity comes on the heels of three

national studies ranking Indiana among the least effective states in
environmental protection.^

This increased legislative attention to the environment comes during

a time when environmental issues are being considered nationally^ and

2. In 1983 and 1984, approximately two percent of the Public Laws passed by

the Indiana General Assembly during its annual sessions could be said to have been laws

that affected the environment in some way. In 1985 and 1986, this percentage increased

slightly to approximately two and one-half percent. In 1987 and 1988, the percentage

continued to increase to approximately three and one-half percent to three and three

quarters percent. In 1989, the percentage of environmental laws passed by the Indiana

General Assembly increased to almost six percent.

APPROXIMATE NUMBER OF PUBLIC LAWS "AFFECTING THE
ENVIRONMENT" PASSED BY THE INDIANA GENERAL ASSEMBLY

FROM 1982 THROUGH 1989

NUMBER OF PERCENT OF PUBLIC
ENVIRONMENTAL TOTAL NUMBER OF LAWS AFFECTING THE

YEAR LAWS PUBLIC LAWS ENVIRONMENT

1982 5 232 2.2%
*1983 7 384 1.8<7o

1984 4 220 1.8<yo

*1985 10 375 2.7%
1986 6 251 2.4%

*1987 15 396 3.8%

1988 7 210 3.3%
*1989 21 357 5.9%

* The Indiana General Assembly holds a "long session," consisting of sixty legislative

days, and a "short session," consisting of thirty legislative days in alternating years.

Those years marked by an asterisk were long sessions; other years were short sessions.

3. See Fund for Renewable Energy and the Environment, State of the
States 1987, 1988 and 1989 Reports. These reports may be obtained from Fund for
Renewable Energy and the Environment, 1001 Connecticut Avenue, N.W., Suite 719,

Washington, D.C. The 1987 report showed Indiana tied for 13th with Maine in studies

of air pollution reduction, soil conservation, groundwater protection, hazardous waste

management, solid waste and recycling, and renewable energy and conservation. Indiana

was one of six states found to have the best renewable energy and conservation policies.

It should be noted, however, that Indiana's renewable energy tax credit, which was largely

responsible for the high ranking, expired January 1, 1988. P.L. 1984-43, § 8. In 1988,

Indiana was ranked 29th in surface water protection, reducing pesticide contamination,

land use planning, eliminating indoor pollution, highway safety and energy pollution

control. In 1989 Indiana was in 41st place in forest management, solid waste recycling,

drinking water, food safety, and growth and the environment.

4. See, e.g., Sancton, Planet of the Year, What on Earth Are We Doing?, Time,
Jan. 2, 1989, at 24 ("Time analyzes the looming ecological crisis and provides an agenda

for urgent action"); Managing Planet Earth, Special Issue, 261 Sci. Am. (Sept., 1989);
As We Begin Our Second Century, The Geographic Asks: Can Man Save This Fragile



1990] INDIANA ENVIRONMENTAL LAW 331

internationally^ as among the foremost issues of our time. Because of
this increased legislative activity and increased environmental concern,

this review of environmental laws passed by the 1989 General Assembly

was undertaken. First, however, the authors provide an overview of

Indiana's administrative structure for environmental protection.^ The new

legislation cannot be understood in isolation. It will be implemented

within the existing administrative system.

II. Administration of Indiana's Environmental Laws

A. Introduction

The Indiana agency^ charged with administering what are commonly
thought of as the "environmental laws"^ of the state is the Indiana

Department of Environmental Management ("IDEM"). Created by the
1985 Indiana General Assembly,^ IDEM came into existence on April

Earth?, 174 Nat'l Geographic 766-914 (1989); Easterbrook, Cleaning Up Our Mess: What
Works, What Doesn't and What We Must Do To Reclaim our Air, Land and Water,
Newsweek, July 24, 1989, at 26. As anyone who has surveyed recent popular magazines
and newspapers knows, the preceding citations are only a small representation of the

media's deluge of coverage of the issue of the environment in 1989.

5. "Apart from the fear of nuclear war, easily the most unifying force around

the world is the desire of 9 in 10 people polled in 16 countries to take stronger action

nationally and internationally to curb pollution and to reverse the serious decay of the

environment. Over 2 in 3 feel their own health is endangered by environmental damage
right in their own country." Morning Edition (National Public Radio broadcast by pollster
Lou Harris) (Aug. 22, 1989).

6. See infra notes 8-42 and accompanying text.

7. The state of Indiana has been authorized by the United States Environmental

Protection Agency ("EPA") to act as the primary enforcer of the most important federal

environmental laws. See, e.g.. Clean Air Act State Implementation Plan Conditional

Approval, 40 C.F.R. 52.773 (1989), amended by 53 Fed. Reg. 33,808, 38,719, 46,608,

50,521 (1988), and 54 Fed. Reg. 2,112, 33,894 (1989). This primary enforcement authority,

or "primacy," allows Indiana to receive federal funds to implement the federal program

in Indiana. Primacy also obliges the state to implement and enforce a regulatory program

that is equivalent to and consistent with the federal program. See, e.g., 42 U.S.C. §
6926(b) (1982). If a state with primacy fails to implement an adequate program, the EPA
administrator is required to withdraw the state program and replace it with a federal

program. Even in states with primary enforcement authority, the EPA maintains concurrent
authority to enforce the federal statutes. See, e.g., 42 U.S.C. § 6928 (Supp. V 1987).

8. IDEM implements regulatory programs to protect the air, land, and water of
the state from harmful pollutants. Other laws, equally important for the protection of

Indiana's environment, regulate the use of Indiana's natural resources and are administered

by the Indiana Department of Natural Resources (IDNR). See Ind. Code §§ 13-2, 13-3,

13-4, 13-4.1, 14-2, 14-4, 14-5 (1988).

9. IDEM was created by a reorganization of the state environmental programs,
and took responsibility for the day-to-day enforcement and implementation of the state's



332 INDIANA LAW REVIEW [Vol. 23:329

1, 1986.^° IDEM was intended to be a separate state agency devoted
entirely to the protection of the environment." The Indiana General

Assembly recognized that '*the problem of pollution in our modern

society is serious and complex, and can be adequately addressed at the

state level only through an arm of state government provided with

adequate funding, staff, and other resources. "^^

Programs built into the regulatory structure of IDEM^^ include the

water pollution control division, ^^ the air pollution control division,*^

and the solid and hazardous waste management division.*^ Each of these

divisions regulates its respective "media" (that is, the water, the air, or

the land) through a system of permits^^ and rules*^ that define the Hmits

of environmentally acceptable behavior in the state.

environmental programs. 1985 Ind. Acts 1129. These programs had previously been im-

plemented and enforced by the State Board of Health under the direction and authority

of the Environmental Management Board, the Stream Pollution Control Board, and the

Air Pollution Control Board. Those preexisting boards maintained their rule-promulgation

and policy-making authority, but their names were changed to the Water Pollution Control

Board, the Air Pollution Control Board, and the Solid Waste Management Board. See

1943 Ind. Acts 625; 1961 Ind. Acts 382; 1972 Ind. Acts 555, and 1985 Ind. Acts 1193.

10. 1986 Ind. Acts 1092.

11. See 1985 Ind. Acts 1074 (preamble).

12. One might question the legislature's commitment to "adequately address" this

"serious and complex problem of pollution," given the perceived deficiencies in IDEM
resources.

13. Ind. Code § 13-7-2-13 (1988) estabhshes not only the regulatory programs for

air, water, and land, but also the office of environmental response for responding to

environmental emergencies, the office of external affairs for communicating with the

public, the office of hearings, the office of technical assistance to assist municipalities

and small business and industry in their efforts to comply and to promote waste reduction

and recycling; as well as offices of investigations, laboratory analysis, and administrative

services.

14. Under Ind. Code § 13-7-2-15 (1988), the Water Pollution Control Division is

the water pollution agency for the purposes of the Federal Water Pollution Control Act,

33 U.S.C. §§ 1251-1387 (Supp. V 1987), and the Federal Safe Drinking Water Act (SDWA),
42 U.S.C. §§ 300f-300j (1984), except for the Underground Injection Control Program

of the SDWA which is to be implemented by the Indiana Department of Natural Resource's
Oil and Gas Division under Ind. Code Ann. §§ 13-8-1-1 to -15-7 (Burns Supp. 1989).

15. The Air Pollution Control Division has primacy for purposes of the Federal

Clean Air Act, 42 U.S.C. §§ 7401-7642 (Supp. V 1987).
16. Ind. Code § 13-7-2-15 (1988) makes the sohd waste management division the

state agency for the purposes of the Resource Conservation and Recovery Act, 42 U.S.C.

§§ 6901-6991 (Supp. V 1987).
17. See Ind. Code Ann. §§ 13-7-10-1 to -5 (Burns Supp. 1989); Ind. Admin. Code

tit. 329, r. 3-33-54, 3-33-54 (Supp. 1989); Ind. Admin. Code tit. 329, r. 2-5-8 (1988);
Ind. Admin. Code tit. 326, r. 2 (1988); Ind. Admin Code tit. 327, r. 2-4 (1988).

18. These rules, codified in Titles 326, 327 and 329 of the Indiana Administrative

Code, are promulgated by the respective boards under the authority of Ind. Code Ann.



1990] INDIANA ENVIRONMENTAL LAW 333

While the structure of Indiana's Department of Environmental Man-
agement is basically sound, the agency has been found to lack the

resources, staff, expertise, and aggressive enforcement to fully effectuate

some of the legislative enactments. ^^ The report of the 1988 Legislative

Sunset Committee regarding IDEM noted that "[n]ew areas of toxics
and groundwater increase the complexity of an already complex field.

DEM resources are being spread thin.'"^^ A study conducted by the
Council of State Governments shows Indiana ranked near the bottom

in two important measures of state expenditures on environmental pro-

grams. Indiana was 49th in per capita spending, and 47th in expenditures

as a percentage of the total state budget. ^^

B. Enforcement

Behavior that exceeds limits of environmental acceptability can, the-

oretically, result in one or more of three types of enforcement actions:

an action initiated by the commissioner of IDEM, an emergency action,
or a citizen initiated action. ^^

7. IDEM Enforcement.—The first, and by far the most common,
enforcement action is one initiated by the commissioner of IDEM. The
commissioner institutes an enforcement action by notifying the alleged

violator in writing that a violation may exist and offering the alleged
violator the opportunity to enter into an agreed order. ^^ If the alleged

§§ 13-1-12-8, 13-1-3-4, and 13-1-1-3 (Burns Supp. 1989). The rules prohibit certain sources

of pollutants from operating without a permit or from exceeding their permit limits. The

rules also forbid everyone from undertaking certain pollution-causing activities, such as

open burning. See Ind. Admin. Code tit. 326, r. 4 (1988).
19. Indiana Legislative Services Agency, Sunset Audit of the Department

OF Environmental Management and Related Boards, Report to Indiana Legislative
Council 16-17 (1988).

20. Id. (Executive Overview) (emphasis added).

21. See R. Brown & L. Garner, Resource Guide to State Environmental
Management (1988). This low level of spending for environmental programs comes at a
time when Indiana state government has a general fund surplus of $559.6 miUion and a

Rainy Day Fund of $265.4 million for the 1988-89 fiscal year. Interview with William J.
Sheldrake, Director Tax & Revenue Policy for State of Indiana in Indianapolis, Indiana,
August 31, 1989.

22. Although all three types of action are statutorily authorized, only the first

option—action initiated by the commissioner in non-emergency situations—is used with
any regularity.

23. This notice of violation must identify the actions required to correct the violation

and, if appropriate, a civil penalty. The Commissioner is not required to extend this offer

for more than sixty (60) days, and the alleged violator may enter into the agreed order
without admitting that the violation occurred. Ind. Code Ann. § 13-7-1 l-2(b) (Burns
Supp. 1989).



334 INDIANA LAW REVIEW [Vol. 23:329

violator does not agree to an order within sixty days,^"* the commissioner

may issue a unilateral order requiring that a specific action be taken,
a civil penalty be paid, or both.^^ The unilateral order of the commissioner

takes effect twenty days^^ after the alleged violator receives it, unless

the alleged violator files a written request for review of the order with

the commissioner before the twentieth day.^^ If a request for review is

timely filed, the commissioner must appoint an administrative law judge

(ALJ) to conduct the review proceedings on behalf of the appropriate

board and in accordances^ with the Administrative Orders and Procedures

Act (AOPA).29

2. Emergency Enforcement.—If an emergency^^ exists, the com-
missioner may bring an action in the name of the state to restrain any
person from causing or contributing to the pollution that is causing the

emergency. ^^ In addition to seeking injunctive relief in emergency situa-

tions, the commissioner may provide assistance to prevent, control, or
neutralize any contaminant causing the emergency, and recover the cost

24. Because the Commissioner may not impose a unilateral order upon a violator
until 60 days have passed from the time of the Notice of Violation, a recalcitrant violator

may avoid the inevitable order (and continue its violation) for two months with no
justification and without entering into good faith negotiations with IDEM. The required
60-day wait thus builds an unnecessary delay of up to two months into the administrative

enforcement system. Id.

25. Id. § 13-7-11 -2(c) (Burns Supp, 1989). This subsection also requires that the

order: be sent via certified mail; be addressed to the last known place of residence or
place of business of the alleged violator; specify the statute or rule violated; and state

the manner and extent of the alleged violation. A copy of the order may also be sent
to a local government unit which may be a party to the action. Id.

26. This twenty day delay does not apply to emergency orders. See infra notes

31-35 and accompanying text.

Also, the order may, by it own terms, take effect after the twentieth day.
27. IND. Code Ann. § 13-7-1 l-2(d) (Burns Supp. 1989).
28. Id.

29. Id. §§ 4-21.5-1-1 to -6-7.

30. The term "emergency" is used slightly differently for each of the three (3)
alternative actions. To request a Governor's order under Ind. Code Ann. § 13-7- 12- 1(a),
the Commissioner must conclude that "contamination of air, water, or land in any area

has reached the point where it constitutes a clear and present danger to the health and

safety of persons in any area." Id. To bring an action on behalf of the state to restrain
pollution under Ind. Code Ann. § 13-7-12-2, the Commissioner must receive "evidence
that a pollution source ... is presenting an imminent and substantial endangerment to

the health of persons, or to the welfare of persons where such endangerment is to the

livelihood of such persons. . . ." Id. Finally, in order to provide emergency assistance to

abate or remedy a discharge or impending discharge of a contaminant under Ind. Code
Ann. § 13-7-12-3(b), the situation must pose "an imminent and substantial danger to the
public health or the environment. . . ." Id.

31. Ind. Code § U-l-ll-l (1988).



1990] INDIANA ENVIRONMENTAL LAW 335

of such assistance from any person responsible for the emergency. ^^

Finally, if the commissioner concludes that a pollution emergency is such

that it presents a clear and present danger to the health and safety of

persons in an area, the commissioner is required to consult with the

secretary of the state board of health and jointly request that the governor

proclaim an emergency and order all persons causing the emergency

situation to immediately discontinue the emissions of contaminants."

Presumably, the commissioner may also issue emergency orders directly
under authority granted to state agencies in general under the AOPA.^"^

3. Citizen Initiated Enforcement.—Any citizen of the state of
Indiana^^ may maintain an action for declaratory and equitable relief
in the name of the state against virtually anyone^^ for the protection of
the environment of the state from significant^^ pollution. ^^

Civil penalties for noncompliance may be up to $25,000 per day
for each violation. ^^ An ongoing offense is considered a separate violation
for each day of violation.'*^ Criminal penalties are also provided by the

Environmental Management Act for knowingly, willfully, recklessly, or

negligently violating the statute or rules."*'

II. Summary of 1989 Legislation

The single most significant piece of new legislation was the Re-
sponsible Property Transfer Law.'*^ That law requires disclosure between

the parties to certain real estate transactions (with notice to certain

government entities) of hazardous materials used, stored, released, or

disposed of on the property before transfer of the land occurs. While

32. Id. § 13-7-12-3.

33. Id. § 13-7-12-l(a).

34. Id. §§ 4-21.5-4-1 to -6.

35. In addition to citizens, other entities authorized under Ind. Code § 13-6-1-1

(1988) to maintain an action under that section include: corporations, partnerships or

associations maintaining an office in the state of Indiana; any state, city, town, county,

or local agency or officer vested with authority to seek judicial relief; or the Attorney

General of Indiana. See infra notes 117-30 and accompanying text for discussion of

amendments to citizen suit provisions.

36. See Ind. Code Ann. § 13-6-1 -1(a)(4) (Burns Supp. 1989).
37. Id. Although "significant pollution" has not yet been defined by Indiana case

law, it might be suggested that it at least includes violations of Indiana's environmental

statutes and rules.

38. See infra notes 117-30 and accompanying text for discussion of citizen en-

forcement in conjunction with the 1989 amendments to Ind. Code § 13-6-1-1 (1988).
39. Ind. Code Ann. § 13-7-13-l(a) (Burns Supp. 1989).
40. Ind. Code § 13-7-13-3(a) (1988).
41. Id.

42. 1989 Ind. Acts 1438.



336 INDIANA LAW REVIEW [Vol. 23:329

passage of that law was encouraging, the amendment of Indiana's citizen

suit provision'*^ was a disappointment. The amendment further weakened

what could have been a major weapon in protecting Indiana's environ-

ment. These two bills are discussed here in detail, followed by a summary

of other environmental legislation adopted in 1989.

A. Responsible Property Transfer Law

L Introduction.—The most noteworthy environmental statute passed
in the 1989 session, at least in terms of its day-to-day impact on practicing

attorneys in Indiana, is Senate Enrolled Act 54 1,"*^ the Responsible

Property Transfer Law (RPTL)."^^ The RPTL requires disclosure of certain
information to transferees of property where there is reason to believe

hazardous materials have been used, stored, released, or disposed of on

the property. The RPTL represents Indiana's recognition of, and par-
ticipation in, an important trend in environmental legislation toward

"transaction-triggered" laws. Such laws are aimed at shifting a part of

the burden of environmental regulation away from the government con-

trols to the market place by restricting the aUenability of property where

hazardous materials activity may have taken place. "^^ By imposing dis-
closure requirements or other restrictions in connection with the transfer

of such property, it is thought property owners will be encouraged to

clean up contaminated sites. It has long been required by Indiana law

and state and federal regulations that the owner of a hazardous waste

disposal facility record a statement in the deed to the property indicating

that the property was so used, and note restrictions on the use of the

property subsequent to the closure of the disposal facility. "^"^ The "trans-

43. 1989 Ind. Acts 658.

44. A Senate Bill becomes a Senate Enrolled Act (SEA) and a House Bill becomes
a House Enrolled Act (HEA) under Joint Rule 2 of the "Joint Rules For Conducting
Business In The Two Houses Of The General Assembly" after the bill has passed both
the House and the Senate during a Session of the General Assembly.

45. 1989 Ind. Acts 1438 (codified at Ind. Code Ann. §§ 13-7-22.5-1 to -21 (Burns
Supp. 1989)).

46. For a discussion of the "transaction-triggered" approaches taken by various

states, see Farer, Transaction-Triggered ECRA: The New Wave in Cleanup Law, Nat'l
L.J., Feb. 27, 1989, at 24-25; Stevens, ECRA: Government and Industry Cope with an
Evolving Regulatory Program, 5 Temp. Envtl L. Tech. J. 17 (1986); Stever, ECRA and
Other Restrictions on the Transfer of Hazardous Waste Sites 151, in The Impact of
Environmental Regulation on Business Transactions (Prac. L. Inst. 1988); Tasher and

Kaufman, A Guide to Nev^ Jersey's Environmental Cleanup Responsibility Act, 3 Nat.
Resources and Env't. 26 (1988).

47. See Ind. Code § 13-7-8. 5-5(d) (1988); Ind. Admin. Code tit. 329, r. 3-46-

10(b) (Supp. 1989) and 40 C.F.R. § 264.119 (1988). The authority of IDEM to require
such restrictive covenants was broadened by legislation passed in the 1989 session. Senate



1990] INDIANA ENVIRONMENTAL LAW 337

action-triggered" statutory requirements imposed by the RPTL and sim-
ilar laws go further, imposing additional requirements of direct notice

to a prospective purchaser of a number of types of properties other

than waste disposal facilities holding state or federal permits.

The inspiration for the wide variety of new laws imposing transaction-
triggered requirements is the New Jersey Environmental Cleanup Re-
sponsibility Act (ECRA)/^ The requirements of the New Jersey statute
go far beyond mere disclosure of information about hazardous substance

activity on the covered property. Under ECRA, the New Jersey De-
partment of Environmental Protection (NJDEP) becomes, in effect, a
party to certain real estate transactions; a transferor must, before con-

summating a transfer, satisfy NJDEP that there has been no release of
hazardous materials at the site, that any such release has been adequately

cleaned up, or submit a cleanup plan for NJDEP approval. If the
transferor fails to comply, the transfer may be voided either by a party
to it or by NJDEP. Not surprisingly, the intimate involvement of the
state environmental bureaucracy in covered real estate transfers entailing

delays of months, or sometimes years, has been perceived as extremely

burdensome by the regulated community."*^

Virtually all of the other ECRA-inspired statutes, including the

Indiana RPTL and the nearly identical Illinois Responsible Transfer
Act,^^ attempt to avoid such problems by emphasizing full disclosure by

the transferor rather than more direct state involvement in the transfer

itself. Presumably, if such disclosure is required at the time of the

transfer, market forces will encourage the cleanup of contaminated sites,

either prior to the sale or pursuant to an agreement by the parties.

Regardless of the form of the requirements, the effect upon practitioners

is the same; business and real estate lawyers must be prepared to routinely

deal with a number of issues which were, until recently, of concern only

to the relatively specialized environmental bar.

2. Disclosure requirements of the RPTL.—At the heart of the
Indiana RPTL is an "Environmental Disclosure Document" which must
be provided by a transferor of property subject to the law. The document

must be delivered to the other parties to the transfer (including lenders

involved in the transaction), recorded in the county where the property

Enrolled Act 370, 1989 Ind. Acts 1414 (codified at Ind. Code Ann. § 13-7-8.7-12 (Burns
Supp. 1989)). This authorizes the commissioner of IDEM to require that restrictive covenants
be recorded in connection with additional categories of hazardous waste management
facilities and other properties where it is suspected that hazardous substances have been

handled. Id.

48. N.J. Stat. Ann. §§ 13:lK-6 to -13 (West 1983).
49. See, e.g., Stevens, supra note 47, at 35.

50. III. Ann. Stat. ch. 30, para. 901-07 (Smith-Hurd Supp. 1989).



338 INDIANA LAW REVIEW [Vol. 23:329

is located, and filed with the IDEM. The recommended form of the
document is set forth in the statute itself.^' The document elicits in-
formation from the transferor concerning a wide variety of hazardous

waste-related activities on the property during the transferor's owner-

ship;^^ the processing, storage, or handling of petroleum; wastewater

discharge, air emission, or waste management permits held by the trans-
feror with regard to the property; requirements of the federal Emergency

Planning and Community Right-to-Know Act ^^ to which the transferor
has been subject; and certain other state or federal environmental actions

to which the transferor, the property, or a facility on the property has

been subject. The transferor must also indicate in the document whether
any reportable releases of hazardous substances or petroleum occurred

on the site during the transferor's ownership, and must (if he or she

has knowledge) state whether certain types of waste facilities were op-

erated on the property when it was under prior ownership. Finally, the
document must contain a ''liabihty disclosure" advising the transferor

and transferee that their ownership or control of the property may render
them Uable for cleanup costs even if they did not cause or contribute
to any environmental problem on the property. The document must be
delivered to the parties by the transferor at least 30 days before the

transfer, unless the deadline is waived by all the parties to the transfer.^"*
Within 30 days after the transfer, the transferor must file the document
with IDEM, and either the transferor or the transferee must record the
document with the appropriate county recorder. ^^

3. Applicability of the Act.—The appHcability of the RPTL to any
given transaction turns upon the definition of "property" and "transfer."
A wide range of conveyances constitute "transfers" subject to the pro-
visions of the Act, including a conveyance of an interest in property

51. IND. Code Ann. § 13-7-22.5-15 (Burns Supp. 1989).
52. There is also some reason to believe the RPTL was intended to apply to

properties where management of the broader category of "hazardous substances" took
place. See infra notes 109-14 and accompanying text. The 1990 amendments to the RPTL
contained in House Enrolled Act 1391 add two catch-all questions concerning the present
owner's activities. New question 9(c) asks whether there is any environmental defect on
the property that is not reported in response to questions 9(a) or (b); new question 11
asks whether the transferor ever conducted an activity on the property without a permit,

when an environmental management permit would have been required.
53. P.L. 99-499, § 4, 100 Stat. 1614 (1986) (codified at 42 U.S.C. §§ 11022-11050

(Supp. 1987)). That statute requires notification to certain emergency response agencies

by facilities which deal with hazardous chemicals.

54. iND. Code Ann. § 13-7-22.5-10 (Burns Supp. 1989).
55. Id. § 13-7-22.5-16. The 1990 amendments in House Enrolled Act 1391 add

Ind. Code § 13-7-22.5-22, permitting a property owner to add a statement to property
records to the effect that an environmental defect of which notice was previously recorded

had been ameliorated.



1990] INDIANA ENVIRONMENTAL LAW 339

by (1) a deed or other instrument of conveyance; (2) a lease whose term

could be over 40 years if all options are exercised; (3) a contract for

the sale of property; (4) an assignment of more than 25 percent of the

beneficial interest in a land trust; or (5) a mortgage or collateral as-

signment of a beneficial interest in a land trust. ^^

While a "transfer" is broadly defined, the definition of "property"

subject to the statute includes only three categories of parcels of real

estate." First, the statute applies to property subject to the reporting

requirements of the federal Emergency Planning and Community Right-
to-Know Act (the Right-to-Know Act).^^ The Right-to-Know Act requires

reporting of a hazardous chemical inventory form by facilities which

must prepare Material Safety Data Sheets pursuant to Occupational Safety

and Health Administration (OSHA) regulations regarding certain haz-
ardous chemicals. As a practical matter, that definition of "property"

will subject virtually all industrial sites to the provisions of the RPTL,
because the OSHA regulations cover all employers whose employees are,
or may be, exposed to hazardous chemicals in the workplace under
normal circumstances or foreseeable emergencies.^^

The second category of real estate subject to the RPTL is property
which is the site of an underground storage tank for which notification

is required under state or federal law.^ The vast majority of such

regulated facilities are gasoline stations and other facilities with petroleum

storage tanks; however, underground tanks containing certain "hazardous

substances"^' are also regulated by the underground storage tank laws.

56. Id. § 1 3-7-22. 5-7(a). Certain transactions are explicitly excluded from the def-

inition of "transfer" in the RPTL. The term "transfer" does not include: (1) a correction,
modification, or supplement, made without additional consideration, to a previously re-

corded deed or trust document; (2) a tax deed; (3) a deed or trust document of release

of property that is security for an obligation; (4) a deed of partition; (5) a conveyance

occurring as a result of a foreclosure of a mortgage or lien; (6) an easement; (7) a

conveyance of gas, oil, or mineral interests; (8) a conveyance by operation of law upon

the death of a joint tenant with right of survivorship; and (9) an inheritance. Id. § 13-

7-22.5-7(b). The 1990 amendments expanded the definition of "transfer" to include any

lease (regardless of term) which includes an option to purchase; a conveyance by a mortgage

or trust deed; and it clarifies that a conveyance by "contract" refers to an installment

land contract. See note 106, infra, and accompanying text.

The 1990 amendments also added to the exclusions to the definition of "transfer".

Most notably, the amendments clarified that neither a deed in lieu of foreclosure nor a

deed or trust document that changes title without changing beneficial interest is considered

a "transfer."

57. Id. § 13-7-22.5-6.

58. 42 U.S.C. §§ 11022-11050 (Supp. V 1987).
59. See 29 U.S.C. §§ 651-678 (Supp. V 1987) and 29 C.F.R. § 1910.1200 (1988).
60. See 42 U.S.C. § 6991(a) (Supp. V 1987) and Ind. Code Ann. § 13-7-20- 13(a)(8)

(Burns Supp. 1989).

61. 42 U.S.C. § 9601(14) (Supp. V 1987).



340 INDIANA LAW REVIEW [Vol. 23:329

The third category of subject property includes parcels listed on the

Comprehensive Environmental Response, Compensation, and Liability

Information System (CERCLIS).^^ jhe CERCLIS is a comprehensive list
of sites which might be candidates for Superfund cleanups under the

Comprehensive Environmental Response, Compensation, and Liability

Act (CERCLA).63 xhe CERCLIS Hst is derived from: (1) notices which
must be provided to EPA of hazardous substance releases and of facilities
where hazardous substances have been treated, stored, or disposed of;

(2) cleanup lists created by the states; (3) closed hazardous waste man-

agement facilities regulated under the Resource Conservation and Re-

covery Act (RCRA);^ and (4) complaints and petitions by citizens. The
CERCLIS hst serves as the source from which EPA establishes a priority
list of sites which will actually be candidates for Superfund cleanups.

It should be noted that certain facilities which fall within the three

categories constituting the definition of covered "property" may not be
subject to the RPTL if the facilities have been closed in accordance
with the applicable Indiana laws. The RPTL apphes only to property
''that has not been subject to bonding or other financial assurances

released by the appropriate governmental agency after compliance with

applicable state laws."^^ Presumably, that provision refers to financial

assurances which are required for regulated underground storage tanks

and for hazardous waste treatment, storage, and disposal facilities. Op-

erators of such facilities are required to post bonds or provide other

types of financial assurance in order that funding sufficient to pay for

proper closure of the facility will be available when the useful life of
the facility has ended. Once the state is satisfied that the closure re-
quirements for the facility have been met, the financial assurance re-

quirements are to be released.^ Upon such release, the facility is no
longer considered "property" subject to the RPTL.

The number of properties included within the three covered categories
is not known with precision. Currently, about 1,200 sites are included
on the CERCLIS list. The number of properties subject to the other
two registration or reporting requirements can only be estimated. IDEM
estimates that about 34,000 sites will be subject to the new underground

62. Id. § 9616.

63. Id. §§ 9601-9661.

64. Id. §§ 6921-6939.

65. IND. Code Ann. § 13-7-22.5-6(1) (Burns Supp. 1989).
66. See, e.g., Ind. Code § 13-7-20-14 (1988) (financial assurance requirements for

underground storage tanks); 12 Ind. Reg. 11 (1989) (financial assurance requirements for

solid waste disposal facilities, to be codified as Ind. Admin. Code tit. 329, r. 2-12); Ind.
Admin. Code tit. 329, r. 3-47-4 (Supp. 1989) (financial assurance for closure of hazardous
waste facilities).



1990] INDIANA ENVIRONMENTAL LAW 341

Storage tank regulations. Currently, nearly 6,000 facilities have submitted

reports under the Right-to-Know Act. However, it is estimated that about

70 percent of the businesses actually subject to the reporting requirements

(and thus, presumably, included in the definition of "property" for

RPTL purposes) have failed to submit the required reports. ^^

4. Effect of Failure to Provide Disclosure Document.—A number
of penalties and other consequences may flow from the failure to properly
complete, submit, record, or file the disclosure document. Even if the

document is properly provided in a timely manner, the transaction may
be affected by a revelation contained in the document indicating that

previously unknown environmental problems exist on the property. First,
a transferee or lender may be reheved of any obligation to complete
the subject transaction as a result of the transferor's failure to provide

the document by the statutory deadline or upon demand of a party
subsequent to the deadline,^^ or if the document reveals defects previously

unknown to the transferee or lender.^^ The RPTL does not permit a
party to void the transaction after the transfer has been completed,

however. ^° Second, the RPTL provides that a party to a covered transfer
may bring a civil action against any other party to the transfer for
consequential damages arising from a violation of the law. Costs and

attorney fees may also be recovered in connection with such actions.^'
In addition to the general provision allowing civil actions, the RPTL
classifies certain violations of the law as "infractions." Failure to deliver

the disclosure document in a timely manner is a Class B infraction, and
subjects the transferor to a fine of up to $1,000.^^ Knowingly making

a false statement in a disclosure document is a Class A infraction, with
a maximum fine of $10,000."^^ Each day that such a false statement goes
uncorrected is a separate infraction. Finally, the failure to record the

document in the county where the property is located is also a Class

A infraction. ^"^ While the RPTL does not explicitly provide for additional

67. Interview with Max Michael, Chief, Prevention Section, Title III Emergency
Planning and Community Right-to-Know, Office of Emergency Response, Indiana De-

partment of Environmental Management, in Indianapohs, Indiana, August 16, 1989.

68. IND. Code Ann. § 13-7-22.5-12 (Burns Supp. 1989).
69. Id. § 13-7-22.5-11.

70. Id. § 13-7-22.5-14.

71. Id. § 13-7-22.5-21.

72. Id. § 13-7-22.5-17.

73. Id. § 13-7-22.5-18.

74. It should be noted that while most RPTL duties and obligations are imposed
upon the transferor, the recording of the document is a joint responsibility of the transferor

and transferee. Id. § 13-7-22. 5-16(c). Curiously, the RPTL does not estabUsh a penalty
for the transferor's failure to file the disclosure document with IDEM. Presumably, the
general penalty provisions of the Environmental Management Act would apply to such a
violation. See Ind. Code § 13-7-13-3 (1988).



342 INDIANA LAW REVIEW [Vol. 23:329

civil or criminal penalties, it must be presumed that the general penalty

provisions which apply to virtually any violation of the Environmental

Management Act, the rules which implement it, or administrative orders

issued by IDEM or its governing boards would also apply to violations
of the various provisions of the RPTL. For example, the Environmental
Management Act establishes penalties of up to $25,000 per day for a

violation of '*any provision" of Indiana Code 13-7, any pollution control
board rule or standard, or any IDEM determination, rule, or order. ^^

In addition, the Act states that any such violations may also be prosecuted
as a Class D felony,^^ and goes on to provide that knowingly making
a "false statement ... in any . , . document filed or required to be

maintained" under Indiana Code 13-7 is a Class B misdemeanor.^^ The
RPTL took effect on January 1, 1990, and applies to transfers which
were closed, or scheduled to close, after December 31, 1989.

5. Issues Arising From the RPTL Provisions.—The relative novelty
of the "transaction-triggered" approach to environmental protection gen-

erally, and the untested and sometimes unclear language of the RPTL
in particular, give rise to a number of questions and concerns about
the meaning and application of the RPTL. The most important concern
to the parties involved in a covered transfer is the effect (or, more

accurately, the lack of effect) on potential liability under CERCLA of
a parcel's apparent clean bill of health with regard to its RPTL disclosure
document. Liabihty under CERCLA''^ is, or should be, a major concern

to many property transferees, especially those taking an interest in an
industrial facility or other parcel where hazardous substances may remain
on-site. Essentially, CERCLA liability may arise in any situation where
the federal government has spent money on a Superfund cleanup, or
where the state has incurred similar expenses under its parallel cleanup

authority. Joint, several, and strict liability attaches not only to the

party who operated the facility at the time hazardous substances were
discharged, but also to present owners (regardless of whether they had

any involvement in past discharges of hazardous materials) and to any

other persons involved in the treatment, transportation, or disposal of

the substances involved. ^^ It should be additionally noted that the CER-

75. IND. Code § 13-7-13-l(a) (1988).
76. Id. § 13-7-13-3(a). The felony provisions of the Act establish "strict liability"

criminal offenses. "Negligent" violations, as well as intentional, knowing, and reckless

acts are punishable under that section.

77. Id. § 13-7-13-3(b).

78. The extremely broad CERCLA liability provisions are found at 42 U.S.C. §
9607 (Supp. V 1987). Senate Enrolled Act 370, 1989 Ind. Acts 1414, imposes equally
broad liability to the State of Indiana when cleanups are financed by the state rather

than by the federal "superfund." See infra notes 132-47 and accompanying text.

79. 42 U.S.C. § 9607(a) (Supp. V 1987).



1990] INDIANA ENVIRONMENTAL LAW 343

CLA definitions of "owner or operator"^° and ''hazardous substance"^*
are very broad. Under the CERCLA and Indiana schemes, potential
liability arises for the costs of cleanup of the site, other response costs

incurred in connection with the discharge, and for damages for related

injuries to natural resources. ^^ It is common for CERCLA liability to
far exceed the value of the parcel where cleanup was necessary. The

CERCLA statute sets forth a small number of strictly limited defenses
to Superfund cleanup expense Hability.*^ Of particular interest in con-
nection with the RPTL is the so-called ''innocent landowner" defense^'*
created by the Superfund Amendment and Reauthorization Act of 1986
(SARA).^^ To establish "innocence" for purposes of the defense, a
property owner must be able to show that she took all prudent steps

to determine that no hazardous substances were disposed of on the site

prior to her purchase of the parcel. ^^ In practice, the necessary, prudent

steps have consisted primarily of an "environmental audit," a detailed

study of the environmental history of the subject parcel and of its record

of compHance with environmental regulations.^^

While the RPTL requires that useful information be provided to
transferees, and gives the transferee an option to cancel the transaction

if previously unknown environmental "defects" are discovered,*® it must
be emphasized that the RPTL disclosure document cannot substitute for
an environmental audit of suspect property. For a number of reasons,

the disclosure document should not be considered even an impHed guar-

antee that property is free of environmental problems; a careful real

estate attorney will continue to insist that an environmental audit be

conducted when appropriate, regardless of the contents of the RPTL
disclosure document. A major inadequacy of the RPTL document, at
least with regard to protecting against CERCLA liability, is that it does
not, strictly speaking, address the environmental quality of the property

itself; rather, it requires the transferor only to answer a number of

80. Id. § 9601(20).

81. Id. § 9601(14).

82. Id. § 9607(a). See also Ind. Code § 13-7-8.7-8 (1988).
83. 42 U.S.C. § 9607(b) (Supp. V 1987)
84. See id. §§ 9607(b)(3), 9601(35) (Supp. 1987). For a further discussion of the

"innocent landowner" defense, see Leifer, EPA's Innocent Landowner Policy: A Practical
Approach to Liability Under Superfund, 20 Env't Rep. (BNA) 646 (1989).

85. Pub. L. No. 99-499, 100 Stat. 1628, 1692 (1986).

86. 42 U.S.C. §§ 9607(b), 9601(35) (Supp. 1987).

87. See generally J. Moskowitz, Environmental Liability in Real Property

Transactions: Law and Practice §§ 16-21 (1989). The 1990 amendments add a disclaimer
to the disclosure document, indicating that compliance with the RPTL will likely not be
sufficient to protect the transferee as an "innocent landowner."

88. Ind. Code Ann. § 13-7-22.5-11 (Burns Supp. 1989).



344 INDIANA LAW REVIEW [Vol. 23:329

questions concerning what she knows about the property. ^^ The questions

need be answered only to the best of the transferor's "knowledge and

belief," and the law nowhere imposes upon the transferor any duty to

inquire or to independently verify the information provided. Further,

the disclosure document concentrates almost entirely on the transferor's

activities on the real estate;^ however, the CERCLA liability may attach
to the current property owner for environmental contamination arising

from the activities of prior owners.^'

The disclosure document also fails to elicit some information which

might be crucial to a determination of CERCLA liability. A notable
example is found in Section 111(A)(8) of the document,^^ which asks

whether the transferor, the property, or a facility on the property has

ever been subject to the filing of an environmental enforcement action

with "a court or the solid waste management board" for which a final

order or consent decree was entered,^^ While the response to that question

will no doubt be of interest to the transferee, as a practical matter, the

majority of administrative enforcement actions initiated by IDEM are
concluded with consent decrees entered into by the violator and the

Department, without the involvement of either the SoHd Waste Man-
agement Board or the courts.^"* The document also fails to elicit infor-
mation about administrative actions that might have been carried out

by any number of other entities, such as the air or water pollution
control boards, the EPA, or the Indiana Department of Natural Re-
sources.^^ As such, even a thorough, knowledgeable, and honest response
to that portion of the disclosure document could leave a transferee with

no protection against CERCLA liability, and in fact, inadequate infor-
mation even to meet the purpose of the RPTL.

A similar problem may arise from the definition of "property"
subject to the RPTL.^^ As indicated above, property which was previously
subject to, and later released from, certain bonding or other financial

assurance requirements (for example, financial guarantees of closure and

89. Id. § 13-7-22.5-15, Section III A.

90. Id. But see id. § 13-7-22.5-15, Section III B (requiring the transferor to disclose
limited information about activity of prior owners to the extent that the transferor knows
of them).

91. 42 U.S.C. § 9607(a) (Supp. V 1987).
92. IND. Code Ann. § 13-7-22.5-15 (Burns Supp. 1989).
93. Id.

94. See generally id. §§ 4-21.5-1 to -6 (administrative procedure and judicial review).

95. Kane, Enactments of the 1989 General Assembly Affecting Environmental Issues

21, unpubHshed manuscript of an address to the Indianapohs Bar Association, July 12,

1989.

96. See supra notes 59-69 and accompanying text.



1990] INDIANA ENVIRONMENTAL LAW 345

post-closure funding for hazardous waste disposal sites^^ and underground

storage tanks^^) is exempt from the disclosure provisions of the RPTL,
apparently on the assumption that the financial assurance requirements

would not have been released unless it was certain that the property

was free of environmental defects. Where potential CERCLA Hability
is concerned, that is not a safe assumption. Such financial assurance

obligations might have been released in accordance with earlier, less

stringent statutes and rules. Further, most such financial assurance re-

quirements were imposed upon facilities which, when they were oper-

ational, dealt with the relatively limited category of *' hazardous wastes. "^^

The broader category of
*

'hazardous substances," ^^ the discharge of

which might give rise to CERCLA liability, is not fully addressed in
the various financial assurance statutes and rules which determine whether

the RPTL applies to a particular parcel.
A number of issues unrelated to potential CERCLA liability are

likely to arise from provisions of the RPTL which are unclear or which
have been left undefined. The most significant source of potential con-

fusion (and litigation) in connection with the RPTL is the crucial void-
ability provision. ^^' That section provides that the parties to the transfer

are not obliged to accept the transfer, or to finance it, if the transferor's

disclosure document reveals ''environmental defects" that were not pre-

viously known to the other parties. '^^ In what appears to be a curious
omission, the term "environmental defect" is not defined in the RPTL
(nor in its Illinois counterpart •°^). As a result, a dispute over whether
any information which is revealed in the disclosure document and which

is relied upon by a party seeking to void the transfer constitutes an

"environmental defect" may be anticipated. It seems clear that a "yes"
response to any question asked on the disclosure document cannot,

without more, be considered to reveal an "environmental defect. "'^ The

97. See generally 40 C.F.R. § 264.140-.151 (1989).

98. See generally id. § 280.90-. 112.

99. See generally 42 U.S.C. § 6901(5) (Supp. 1987) and 40 C.F.R. § 261 (1989).
100. See infra note 113.

101. IND. Code Ann. § 13-7-22.5-11 (Burns Supp. 1989).
102. Id.

103. III. Ann. Stat. ch. 30, paras. 901-907 (Smith-Hurd Supp. 1989). The 1990

amendments to the RPTL add a definition of "environmental defect" in new Ind. Code
§ 13-7-22.5-1.5. An "environmental defect" includes a violation of an environmental law
or rule; a situation requiring environmental remedial action; a situation that substantially

endangers health, welfare or the environment; a situation which would materially lower

the value of the subject property or adjoining property; or a problem that would prevent

or interfere with someone else's ability to obtain an environmental permit needed to

operate a facility on the property.

104. Kane, supra note 96, at 12.



346 INDIANA LAW REVIEW [Vol. 23:329

fact that a transferor once held a permit for emissions to the atmosphere,

for example, cannot reasonably be seen as evidence of a present ''defect"

sufficient to justify avoidance of the transfer obligation. Until or unless

the RPTL is amended to clarify the term, the burden may fall upon
the parties to the transfer to define the relevant "environmental defects"

within each transfer agreement.

Another definitional question arises from the application of the RPTL
to a "contract for the sale of property. "'°^ While that section presumably

contemplates typical installment land contracts, the absence of any def-

inition of "contract for the sale of property" leaves open the possibility

that other kinds of agreements might be subject to the RPTL. For
example, if the agreement to purchase real estate which commonly
precedes a conveyance by deed is considered such a "contract," the

RPTL disclosure document would have to be provided at least 30 days
before the parties decided to enter into their purchase agreement, rather

than (or possibly in addition to) 30 days prior to the actual conveyance

by deed (which is itself defined as an RPTL "transfer"). An overly
inclusive interpretation of "contract" could thus cause substantial, un-

expected, and unnecessary delays in connection with otherwise routine

transactions.'^

Finally, a third definitional issue arises from a provision in the RPTL
which is not unclear, but may be erroneous. Section 111(A)(1) of the
RPTL disclosure document asks whether the transferor has ever "con-
ducted operations on the property which involved the generation, man-

ufacture, processing, transportation, treatment, storage, or handling of

'hazardous waste', as defined by IC 13-7-1."'°^ The document then goes

on in Section 111(A)(3) to ask, without mentioning the consumer goods

exclusion, a virtually identical question: "Has the transferor ever con-
ducted operations on the property which involved the generation, trans-

portation, storage, treatment, or disposal of 'hazardous waste', as defined

in IC 13-7-1."'^^ There are three reasons to believe that Question 111(A)(1)

of the Indiana disclosure document should have referred to "hazardous

substances" rather than "hazardous waste. "'^ First, the use of "haz-

105. Ind. Code Ann. § 13-7-22.5-7(a)(5) (Burns Supp. 1989). There is no parallel
provision in the Illinois Responsible Transfer Act after which the Indiana statute is modeled.

III. Ann. Stat. ch. 30, para. 903(g) (Smith-Hurd Supp. 1989) does not address a conveyance

by "contract" within the definition of "transfer."

106. See Kane, supra note 96, at 6.

107. Ind. Code Ann. § 13-7-22.5-15 (Burns Supp. 1989) (certain consumer goods
are excepted).

108. Id.

109. See Kane, supra note 96, at 21, The 1990 amendments changed the wording

of question III (A) (1) to refer to a "hazardous substance."



1990] INDIANA ENVIRONMENTAL LAW 347

ardous waste" in the two nearly identical sections of the Indiana doc-

ument causes the questions to be, for all practical purposes, redundant.

Second,
*

'hazardous substances" are referred to elsewhere in the dis-

closure document as a category distinct from "hazardous wastes."''^

Third, the nearly identical Illinois act refers to "hazardous substances"

rather than "hazardous wastes" in the section of the IlUnois disclosure

document which parallels question 111(A)(1) of the Indiana document. ^^^

The choice of terminology potentially has a tremendous effect on the

extent of the RPTL's applicability, because "hazardous substance," as
defined in the Indiana, Illinois and federal statutes, is a far more inclusive

term than "hazardous waste." The statutory definition of "hazardous

substances" includes a far broader range of materials than does the

definition of "hazardous waste," and is not limited to materials which

have been "discarded." As such, "hazardous substances" may include
products in use, as well as discarded "waste. "^'^ Thus, it appears that

110. See IND. Code Ann. § 13-7-22.5-15 (Burns Supp. 1989), questions III (A)(4)
and III (A)(9) of the disclosure document.

111. III. Ann. Stat. ch. 30, para. 905 (Smith-Hurd Supp. 1989). Question IV(1)
of the lUinois disclosure document, which corresponds to question III (A)(1) of the Indiana

document, asks whether the transferor ever conducted operations on the property involving

the "generation, manufacture, processing, transportation, treatment, storage, or handling

of "hazardous substances'' as defined by the Ilhnois Environmental Protection Act?" Id.

(emphasis added). Question 1V(3) of the Illinois document, which corresponds to question

III (A)(3) of the Indiana document, refers (like the Indiana question) to "hazardous

wastes'' as defined in the appropriate state's environmental protection statute. (The IlUnois

question also asks about "special wastes," a category which includes certain industrial

process waste, pollution control waste, and hazardous waste. See III. Ann. Stat. ch. Ill

1/2, para. 1003.45 (Smith-Hurd 1988). "Special waste" is also recognized as a separate

category by the Indiana solid waste rules, see 12 Ind. Reg. 1179-83 (1989) (to be codified

as Ind. Admin. Code tit. 329, r. 2-21), but the Indiana disclosure document does not
inquire about special waste.

112. The definition of "hazardous waste" which is referred to in Questions 111(A)(1)

and 111(A)(3) of the Indiana disclosure document is found at Ind. Code Ann. § 13-7-1-

12 (Burns Supp. 1989). The statute defines "hazardous waste" as:

a solid waste . . . that, because of its quantity, concentration, or physical,

chemical, or infectious characteristics, may: (1) cause or significantly contribute

to an increase in mortality or increase in serious, irreversible, or incapacitating

reversible, illness; or (2) pose a substantial present or potential hazard to human
health or the environment when improperly treated, stored, or disposed of, or

otherwise managed."

The definition of "hazardous waste" in the Illinois Environmental Protection Act is nearly

identical. See III. Ann. Stat. ch. Ill 1/2, para. 1003.15 (Smith-Hurd 1988). "Solid

waste," in turn, is any "discarded material resulting from industrial, commercial, mining,

or agricultural operations or community activities." Ind. Code Ann. § 13-7-1-22 (Burns
Supp. 1989). The regulatory definition of "hazardous waste," however, specifically excludes

sewage, industrial discharges regulated by the federal water pollution control statutes,

certain nuclear waste, and waste resulting from some farming operations. See Ind. Admin.



348 INDIANA LAW REVIEW [Vol. 23:329

the application of the Indiana Act, because of its possibly erroneous

reference to "hazardous waste" in Question 111(A)(1), might be limited

to a much narrower range of properties than was contemplated by
legislators intending to adopt legislation similar to the Illinois Act. Until

or unless the wording in Questions 111(A)(1) and (3) is clarified, trans-

ferors might be well advised to err on the side of greater disclosure,

responding to Question 111(A)(1) as if the broader class of '^hazardous

substances" rather than the relatively narrow class of '^hazardous wastes"

was actually the subject of the inquiry.

In addition to the above-mentioned definitional issues left unsettled

until the RPTL is interpreted by the courts or clarified by the legislature,
two potential practical problems are immediately apparent. First, while

the types of
*

'property" subject to the RPTL are relatively clearly defined,
a determination of whether a given parcel is included within the definition

will, as a practical matter, be difficult. As discussed previously,"^ there
is an excellent possibility that the owner of a parcel subject to the

underground storage tank or Right-to-Know Act reporting requirements

has failed to submit the required reports. Even if information about a

property has been reported as required, information about the status of

the property may be difficult to obtain. Parties to real estate transactions
and their attorneys will, in large part, be dependent upon the already-
strained resources of IDEM for information about whether a parcel is
on the CERCLIS list, whether it is the site of an underground storage
tank, or whether Right-to-Know Act reports have been submitted with

regard to the property. While virtually all IDEM records which are not

Code tit. 329, r. 3-3-4 (1988).
A "hazardous substance," by contrast, is not limited either to "waste" or to "solid"

or semi-solid material. Indiana has adopted the CERCLA definition of "hazardous sub-
stance," 42 U.S.C, § 9601(14) (Supp. V 1987) and also includes other substances declared
hazardous by IDEM. Ind. Code Ann. § 13-7-8.7-1 (Burns Supp. 1989). The Indiana and
federal definition of "hazardous substance," as well as the nearly identical Illinois definition

found at III. Ann. Stat. ch. Ill 1/2, para. 1003.14 (Smith-Hurd 1988), encompass the

entire category of "hazardous waste" regulated by the Federal Resource Recovery and

Conservation Act (RCRA), 42 U.S.C. §§ 6921-6939 (Supp. V 1987) and by the Illinois
and Indiana statutes. In addition, "hazardous substances" include substances designated

as hazardous by CERCLA regulations pursuant to 42 U.S.C. § 9602 (Supp. V 1987), as
well as pollutants regulated under certain provisions of the Clean Air Act, 42 U.S.C. §

7412 (1984), the Water Pollution Control Act, 33 U.S.C. §§ 1317, 1321 (Supp. V 1987),
and the Toxic Substances Control Act, 15 U.S.C. § 2606 (1984). So, a "hazardous

substance" may include virtually anything the EPA determines may threaten significant
danger if released to the environment, whether or not it is "waste" or "sohd." Petroleum

and natural gas are generally excluded from the definition of "hazardous substance." 42

U.S.C. § 9602(14) (Supp. V 1987). See 40 C.F.R. § 302.4 (1988) (list of CERCLA
hazardous substances).

113. See supra note 69 and accompanying text.



1990] INDIANA ENVIRONMENTAL LAW 349

**trade secrets" or **privileged" are available for public inspection,
^'"^

the agency is, in most situations, not obliged to search for and provide

such information to members of the public who need it. As a result,
a transferor or transferee who is out of state or in areas of Indiana
far from the IDEM offices may bear a heavy burden in time and expense
in searching IDEM records to determine whether a specific parcel falls
within a class of "property" subject to the RPTL provisions.''^

A second practical problem arises from the very nature of the
CERCLIS list, the placement of property upon which will bring the
RPTL requirements into play. While most of the sources of the CERCLIS
list suggest that a hsted parcel is, indeed, likely to be environmentally

'^defective," it should be noted that a number of CERCLIS properties
are placed on the list solely because citizen complaints have been received.

As a result, it is probable that a number of CERCLIS properties pose
no environmental threat; the citizen complaints which led to the listing

of the property might well have been unrelated to the concerns the

RPTL seeks to address, or may simply have been unfounded from an
environmental perspective. It is likely, however, that the very fact that

a parcel is on the CERCLIS list, and the resulting imposition of the
RPTL requirements, could have an occasional "chilling effect" on a
prospective transferee, whether or not a factual basis existed for the

citizen complaint that resulted in the CERCLIS listing.
6. Conclusion.—The disclosure requirements of the RPTL, when

properly observed, will no doubt benefit purchasers of most industrial

parcels in Indiana by assuring that the purchaser receive certain valuable

information about the subject real estate. It must be emphasized, however,

that the RPTL serves to provide only information, and not protection
from liability which may independently arise from prior environmental

114. IND. Code §§ 5-14-3-3 to -4, 13-7-6-6 (1988).
115. It should be noted that new Indiana hazardous waste rules will require IDEM

to search for and provide some agency records upon request. The rules, 12 Ind. Reg.

2035-46 (1989) (to be codified at Ind. Admin. Code tit. 329, r. 3-58) adopt the federal
disclosure requirements and provide that IDEM must search for and provide to the requestor
certain "hazardous waste records." While it is Ukely that some of the information pertinent

to determining the applicability of the RPTL to a particular parcel of land will fall within
the definition of "IDEM hazardous waste record" in Ind. Admin. Code tit. 329, r. 3-
58-1 (1989), it is doubtful that all three categories of covered "property" will be included.

If relevant property information is not within the definition of "IDEM hazardous waste
record," an interested prospective transferor or transferee cannot expect IDEM assistance
in locating or providing the information. The 1990 amendments add new Ind. Code sec.
13-7-22.5-9.5, which requires IDEM to "provide information" that is in its possession
concerning whether a parcel falls within the RPTL definition of "property". The new
section does not, however, indicate what service IDEM must provide beyond simply opening
its files. The new section also releases the state, IDEM, and IDEM employees from liability
for providing incomplete or erroneous information.



350 INDIANA LAW REVIEW [Vol. 23:329

damage to the property. A cautious purchaser or lender will thus continue
to insist on a thorough environmental audit appropriate to the property.

B. Citizen Suit Provisions

While an increase in the amount of environmental legislation passed

shows increased interest in the environment, not all the legislation will

necessarily have a positive effect. One disappointing enactment of the
1989 legislative session was House Enrolled Act 1148."^ Sections 2 and

4 of that law, which became effective July 1, 1989, weakened an already

anemic "citizen suit" provision.''^ The citizen suit statute which allows

citizens to act as "private-attorneys general" to bring suit against violators

of environmental laws is theoretically an integral part of most states'

and the federal government's environmental protection strategies.*'^ In-

diana's provision allows a citizen to "bring an action for declaratory

and equitable relief in the name of the state against an individual . . .
a company ... or any other legal entity ... for the protection of the
environment of Indiana from significant pollution, impairment, or de-

struction."*'^

An overview of this provision reveals an already weak statutory
scheme for citizen suits in Indiana. A citizen suit filed under the Indiana
statute may be used only to gain declaratory or equitable relief. No
provision for civil penalties or for litigation expenses such as attorney

or expert witness fees is provided for in the Indiana statute. Civil penalties

are an integral part of any enforcement scheme because the threat of

fines for past violation may provide an economic incentive for regulated
entities to bring themselves into prompt compliance with the applicable

laws. This is especially true in environmental regulation given the con-

siderable expense of compliance. Further, when citizen litigants cannot

116. 1989 Ind. Acts 658.

117. Ind. Code §§ 13-6-1-1 to -6 (1988). An item of note here is the difference
between Indiana's citizen suit authority and the provisions set out in the federal envi-

ronmental lav^s. The federal provisions allow citizens to sue for civil penalties as well as

injunctive relief to provide consistency in the regulatory program implemented by the

agency and by the citizens. The federal provisions also allow citizen plaintiffs to recover

the costs of the action, including attorney and expert witness fees, when the court deems

it appropriate. There is no such provision in the Indiana statute. For an excellent discussion

of environmental citizen suits see Miller, Private Enforcement of Federal Pollution Control

Laws, 13 Envtl. L. Rep. (Envtl. L. Inst.) 10,309 (1983).

118. See generally Hanks, An Environmental Bill of Rights: The Citizen Suit and
the National Environmental Policy Act of 1969, 24 Rutgers L. Rev. 230 (1969-70); Note,

Standing on the Side of the Environment: A Statutory Prescription for Citizen Participation,
1 Ecology L. Q. 561 (1971). See also Annotation, Maintainability in State Court of Class

Action for Relief Against Air or Water Pollution, 47 A.L.R.3d 796 (1973).

119. Ind. Code Ann. § 13-6- 1-1 (a)(4) (Burns Supp. 1989).



1990] INDIANA ENVIRONMENTAL LAW 351

recover reasonable expert witness and attorney's fees, the cost of litigation

effectively prohibits all but the wealthiest persons from bringing private

enforcement actions. Thus, to earnestly undertake a citizen suit under

Indiana law, one must be prepared to suffer substantial financial loss

for litigation expenses with the prospect of merely receiving injunctive

relief. Absent the authority to recover penalties or the cost of htigation,

environmental citizen suits in Indiana's courts are currently prohibitively

expensive and unfortunately incomplete tools of enforcement. This seems

contradictory to the goal of encouraging private actions as a supplement

to government efforts to protect the environment. Federal citizen suit

provisions, by contrast, allow for the recovery of civil penalties, attorney's

fees and expert witness fees.'^°

As a condition precedent to maintaining an action in Indiana, notice

must be given to the Department of Natural Resources, the IDEM, and
the attorney general.'^' Those state agencies are then required to notify

all state administrative agencies having jurisdiction over or control of

the pollution, impairment, destruction, or protection of the environment

for which rehef is sought. '^^ This notice allows the appropriate agency

to institute an administrative action against the alleged violation. These

provisions were not changed by the 1989 amendments.

The amendment that could allow a great deal more bureaucratic
foot-dragging deleted the requirement that a "final determination" of

the administrative action be completed within 180 days after receipt of

notice by the Attorney General.'" If the agency failed to meet that 180-

day requirement, the citizen suit could then proceed. Either way, the

action moved forward to some kind of final determination whether
administratively or judicially. The new provision requires only that the
agency "commence an administrative proceeding" within 90 days of the
citizen's notice. '^'* The new provision may permit indefinite bureaucratic
delays. Under the new 90-day rule, an action may not be maintained
unless none of the agencies that receives notice of the action commences

an administrative proceeding or a civil action on the alleged pollution

within 90 days after receiving notice. '^^ In other words, all the government

agency need do to halt a citizen suit is to begin "administrative pro-

ceedings." Another option to halt a citizen suit is for a notified agency

120. See 42 U.S.C. § 7604 (Supp. V 1987) (Clean Air Act); 33 U.S.C. § 1365
(Supp. V 1987) (Federal Water Pollution Control Act); 42 U.S.C. § 6972 (Supp. V 1987)
(Resource Conservation and Recovery Act).

121. Ind. Code Ann. § 13-6-l-l(a) (Burns Supp. 1989).
122. Id.

123. iND. Code § 13-6-l-l(b) (1988).
124. Ind. Code Ann. § 13-6-1 -1(b) (Burns Supp. 1989).
125. Id. § 13-6-1- 1(b)(1)(A); Ind. Code § 13-7-11-2(1) (1988).



352 INDIANA LAW REVIEW [Vol. 23:329

to "take steps" within 90 days after receiving notice to have a criminal

prosecution commenced. Finally, the agency that commences an admin-

istrative proceeding on the alleged pollution must "diligently pursue"

the proceeding after it is commenced. In contrast to the previous rule,

no time frame is set for a final determination by the administrative

agency. A court, moreover, might allow the agency an excessive amount
of time to act by broadly interpreting "diligently pursue" because of

the constraints within which the agencies are conducting their business. ^^^

The Indiana Department of Natural Resources and IDEM are under-
staffed and underfunded.'^^ The effect of the disincentives in the original

citizen suit provision is reflected in the fact that the statute has rarely

been used since it was originally passed in 1971.'^^ The 1989 modification

of Indiana's citizen suit provision will only further cripple any citizen-

enforced environmental protection strategy.

The citizen suit could be a vital part of this state's comprehensive

environmental protection strategy, especially considering the scarcity of

IDEM resources'^^ and the popularity of environmental protection ini-
tiatives. One might think that the legislature would embrace the op-
portunity to impose the cost of effective environmental enforcement on

the parties creating the environmental problems. An adequate citizen
suit provision would be a privately administered failsafe system to com-

plement IDEM's underfunded enforcement mechanism.

C. Property Owner Liability

Senate Enrolled Act 370'^° created statutory provisions to make
Indiana provisions for clean-up of environmentally contaminated sites

more similar to the federal provisions in CERCLA.'^' The amendments
were intended to make state law parallel to federal law for Hability of
property owners'^^ and also to allow the state to place a restrictive

126. Judicial construction of these statutory terms is open to speculation because

there is no case law addressing such new legislation. Furthermore, this weakening of

Indiana's citizen suit provision seems to be in response to the already rare use of the

provision.

127. See supra notes 20-22 and accompanying text.

128. See Sekerez v. United States Reduction Co., 168 Ind. App. 526, 344 N.E.2d

102 (1976); Sekerez v. Youngstown Sheet & Tube Co., 166 Ind. App. 563, 337 N.E.2d
521 (1975); J.M. Foster Co., Inc. v. Northern Ind. Pub. Serv. Co., 164 Ind. App. 72,

326 N.E.2d 584 (1975). These are the only reported cases citing Indiana's citizen suit

provision. The number of suits or notices filed under this provision is unknown.

129. See supra note 22 and accompanying text.

130. 1989 Ind. Acts 1414 (amending Ind. Code § 13-7-1) (1988).
131. See supra notes 80-89 and accompanying text.

132. 1989 Ind. Acts 1422 (amending Ind. Code § 13-7-8.7-8) (1988).



1990] INDIANA ENVIRONMENTAL LAW 353

covenant on property.^" A person that is liable under section 107(a) of
CERCLA for: (1) costs of removal or remedial action; (2) costs of any
health assessment or health effects; or (3) damages for injury to or loss

of natural resources of Indiana is liable, in the same manner and to

the same extent, to the State of Indiana. '^^ Any person that is responsible
for a release of hazardous waste and fails, without sufficient cause, to

provide removal or remedial action by court order is liable for punitive

damages. '^^ The IDEM commissioner may seek punitive damages of up
to 300 percent of the total costs incurred by IDEM as a result of the
person's failure to properly provide removal or remedial action. '^^ The

commissioner of IDEM may compel any responsible person to undertake
removal or remedial action. '^^ A restrictive covenant may be placed on
property if the commissioner determines that it is necessary for the

"protection of the public health or welfare or the environment from

unreasonable risk of future exposure to a hazardous substance. "'^^ The

restrictive covenant may be altered if "a change of conditions or ad-
vancements in science or technology permit. "^^^

House Enrolled Act 2061 ''^^ provides hability protection for land-

owners on whose land "garbage or other soHd waste (except hazardous

waste) has been illegally dumped without the landowner's consent."'^'
The Commissioner, however, may take enforcement action against the
landowner after making "a diligent and good faith effort" to identify,

locate, and take enforcement action against a person who appears likely
to have committed or caused the illegal dumping. '^^ The provision also

gives protection to the landowner for providing "good faith" information

to the Commissioner about potentially responsible persons. The Com-
missioner may include the landowner as a party to any enforcement
action against an alleged violator.''*^ This permits the Commissioner to

allow the alleged violator access to the land to remove and dispose of

the solid waste illegally dumped on the land.'"*^ Finally, the "landowner
on whose land garbage or other solid waste has been illegally dumped

133. 1989 Ind. Acts 1425. See Ind. Code Ann. § 13-7-8.7-12 (Burns Supp. 1989).
134. 1989 Ind. Acts 1422. See Ind. Code Ann. § 3-7-8.7-9 (Burns Supp. 1989).
135. 1989 Ind. Acts 1423. See Ind. Code Ann. § 3-7-8.7-10(b)(2) (Burns Supp.

1989).

136. 1989 Ind. Acts 1423.

137. 1989 Ind. Acts 1422. See Ind. Code Ann. § 13-7-8.7-9 (Burns Supp. 1989).
138. 1989 Ind. Acts 1425. See Ind. Code Ann. § 13-7-8.7-12(b) (Burns Supp. 1989).
139. 1989 Ind. Acts 1425. See Ind. Code Ann. § 13-7-8.7-12(d) (Burns Supp. 1989).
140. 1989 Ind. Acts 1434 (amending Ind. Code § 13-7-11) (1988).
141. 1989 Ind. Acts 1434. See Ind. Code Ann. § 13-7-1 l-6(a) (Burns Supp. 1989).
142. 1989 Ind. Acts 1434.

143. Id. See Ind. Code Ann. § 13-7-11 -6(b) (Burns Supp. 1989).
144. 1989 Ind. Acts 1434.



354 INDIANA LAW REVIEW [Vol. 23:329

without the landowner's consent may, in addition to any other legal or

equitable remedy, recover from the responsible dumper: (1) reasonable

expenses incurred by the landowner in disposing of the waste, and (2)
reasonable attorney fees.'""*^

D. Water

House Enrolled Act 1592"*^ made minor changes to the procedure
involved in the declaration of a ground water emergency by the Director

of the Department of Natural Resources (DNR).

The Director of the DNR is required to declare a ground water
emergency, '''^ by temporary order, if an investigation discloses the well

of an owner of a "nonsignificant ground water withdrawal facility" '"^^

(a facility that has a withdrawal capability of less than 100,000 gallons

of ground water in one day) has been adversely affected by the owner

of a "significant ground water withdrawal facility" ^'^^ (a facility that has

a withdrawal capability of 100,000 gallons or more of ground water in

one day). The Director may then restrict the quantity of water that may
be extracted by the significant ground water withdrawal facility. ^^^

Previously, the declaration of the ground water emergency was ef-

fective when a copy of the declaration was served upon the owner of
the significant ground water withdrawal facility. ^^^ House Enrolled Act
1592 added Indiana Code section 13-2-2. 5-6(c) which provides that if a
ground water emergency requires action before a copy of the declaration

can be served upon the owner of the significant ground water withdrawal
facility, then oral notification of the owner by a representative of the

DNR is sufficient to make the ground water emergency effective until
a copy of the declaration can be delivered to the owner. '^^ Oral noti-

fication is effective for no more than 96 hours after being delivered. ^^^

House Enrolled Act 1592 also specified that the temporary order

issued by the Director remains in effect for 90 days unless it is terminated

by the Director before that time or is extended under Indiana Code
section 4-21.5-4, the Administrative Adjudication Act.^^"^

145. Id.

146. 1989 Ind. Acts 1392 (amending Ind. Code § 13-2-2.5) (1988).
147. 1989 Ind. Acts 1392. See Ind. Code Ann. § 13-2-2.5-3(c) (Burns Supp. 1989).
148. Ind. Code § 13-2-2.5-2 (1988).
149. Id.

150. 1989 Ind. Acts 1394. See Ind. Code Ann. § 13-2-2.5-3.5 (Burns Supp. 1989).
151. Ind. Code § 13-2-2.5-6 (1988).
152. 1989 Ind. Acts 1394.

153. Id.

154. 1989 Ind. Acts 1395. See Ind. Code Ann. § 13-2-2.5-1 1(a) (Burns Supp. 1989).



1990] INDIANA ENVIRONMENTAL LAW 355

House Enrolled Act 1702^^^ added a new chapter to the Indiana

Code concerning ground water protection. The Act established the In-

teragency Ground Water Task Force to coordinate the implementation

of the Indiana ground water quahty protection and management strategy,

study ground water contamination in Indiana, and coordinate efforts

among government agencies to address ground water pollution prob-
lems. '^^ The Task Force is required to make an annual report on its
activities to the Governor and the General Assembly. '^^

House Enrolled Act 1702 also required the IDEM to establish and
operate a ground water clearing house to receive and ensure investigation

of complaints about ground water contamination, provide information

to the public about ground water and ground water pollution, and

coordinate the management of ground water quality data in Indiana. '^^

Also, the Water Pollution Control Board is required to adopt a variety

of rules regarding ground water. First, before July 1, 1990, the Board

must establish ground water quality standards. '^^ Second, the Board is

required to adopt rules before January 1, 1991, establishing protection

zones around community water system wells, ^^ and also establishing

procedures for the construction and monitoring of surface impoundments

used for the storage or treatment of nonhazardous waste and waste-

water.'^^

House Enrolled Act 1261'^^ amended Indiana Code section 14-3-1-

14, which lists the powers and the duties of the Department of Natural

Resources, by adding new language that states the Department of Natural

Resources is to cooperate with the IDEM, other state agencies, and local
units of government to protect the waters and the lands of Indiana from

pollution.'" House Enrolled Act 1261 also added a new section to the

Code that requires a person or an entity, other than a pubhc or municipal
water utility, to obtain a permit from the Department of Natural Re-

sources before filling, erecting a permanent structure in, or removing

material from a navigable waterway.'^

Senate Enrolled Act 340'^^ estabhshed the Water Resources Study

Committee, comprised of six state Senators and six state Representatives,

155. 1989 Ind. Acts 1452 (adding Ind. Code § 13-7-26) (1988).
156. 1989 Ind. Acts 1452. See Ind. Code Ann. § 13-7-26-2 (Burns Supp. 1989).
157. 1989 Ind. Acts 1452. See Ind. Code Ann. § 13-7-26-2(h) (Burns Supp. 1989).
158. 1989 Ind. Acts 1452. See Ind. Code Ann. § 13-7-26-4 (Burns Supp. 1989).
159. 1989 Ind. Acts 1452. See Ind. Code Ann. § 13-7-26-6 (Burns Supp. 1989).
160. 1989 Ind. Acts 1452. See Ind. Code Ann. § 13-7-26-7 (Burns Supp. 1989).
161. 1989 Ind. Acts 1452. See Ind. Code Ann. § 13-7-26-8 (Burns Supp. 1989).
162. 1989 Ind. Acts 890.

163. 1989 Ind. Acts 890. See Ind. Code Ann. § 14-3-1-14(8) (Burns Supp. 1989).
164. 1989 Ind. Acts 889. See Ind. Code Ann. § 13-2-4-9 (Burns Supp. 1989).
165. 1989 Ind. Acts 1388.



356 INDIANA LAW REVIEW [Vol. 23:329

to serve during the One Hundred Sixth Session of the General Assembly.
The Committee is to study and make recommendations to the General
Assembly on all matters relating to the surface and ground water resources

of Indiana.

E. Recycling

House Enrolled Act 1148^^^ added a new chapter to the Indiana

Code that requires the IDEM Office of Technical Assistance (OTA) to
gather and disseminate information on industrial practices that reduce,

eliminate, or avoid the generation of hazardous waste in order to reduce

risks to human health and the environment. ^^^ The OTA is to provide
this information in response to a request from a business that is active

in Indiana and, in the absence of a request, the OTA may present advice
on hazardous waste to a business that, in the judgment of the Com-
missioner of the IDEM, could significantly reduce, eliminate, or avoid
the generation of hazardous waste through industrial waste reduction

practices. *^^ In an effort to aid the OTA with gathering data on the
generation and generators of hazardous waste in Indiana, the statute

requires a person who submits the required biennial report concerning
hazardous waste generation^^^ to include additional information in the

report concerning the person's hazardous waste generation and the per-

son's industrial operation.
^"^^

House Enrolled Act 1310^"^' established the Solid Waste Separation

and Recycling Projects Fund. If money is available in the Fund, the
IDEM may make grants from the Fund to cities, towns, and counties
for projects involving solid waste separation or solid waste recycling. ^^^

The Fund is scheduled to terminate July 1, 1991.^^^

Senate Enrolled Act 41 S^^'^ requires state government agencies, in-

cluding the legislative and judicial branches of state government and

state supported colleges and universities, to make reasonable efforts to
collect and recycle paper products used by the agencies. ^^^ The Act also

requires state government agencies to procure recycled paper products

166. 1989 Ind. Acts 663 (adding Ind. Code § 13-7-27).
167. 1989 Ind. Acts 663. See Ind. Code Ann. § 13-7-27-4(a), (b) (Burns Supp.

1989).

168. 1989 Ind. Acts 663. See Ind. Code Ann. § 13-7-27-4(c) (Burns Supp. 1989).
169. See 42 U.S.C. § 6922(a)(6) (Supp. V 1987).
170. 1989 Ind. Acts 663 (amending Ind. Code § 13-7-27-7) (1988).
171. 1989 Ind. Acts 2101.

172. Id.

173. Id.

174. 1989 Ind. Acts 525. See Ind. Code Ann. §§ 4-13-4.1-5 and 20-12-67-1 to -3

(Burns Supp. 1989).

175. Id.



1990] INDIANA ENVIRONMENTAL LAW 357

if recycled paper products are available at the time of a paper products

procurement and it is economically feasible to procure those paper

products. '^^

Senate Enrolled Act 430'"^'^ requires the same state government entities

affected by Senate Enrolled Act 415'"'^ to procure disposable plastic

products that are degradable if degradable plastic products are available

at the time of a procurement of plastic products, the procurement is

appropriate, and the procurement is economically feasible. ^^^

Beginning January 1, 1992, under Indiana Code Section 13-7-22-1,

as added by Senate Enrolled Act 219,^*° a person may not sell a plastic
bottle with a capacity of sixteen fluid ounces or more or a rigid plastic

container with a capacity of eight fluid ounces or more unless the bottle

or container is coded with a three sided triangular arrow with a number

in the center and letters underneath indicating the resin from which the

bottle or container is made.^^' This coding is to assist recyclers in sorting

plastic bottles and containers by resin composition.

House Enrolled Act 1926'^^ added a new chapter to the Indiana

Code, creating the Indiana Institute on Recycling located at Indiana

State University. ^^^ The Institute is to develop concepts, methods, and

procedures to assist in efforts in recycUng solid waste in Indiana.'^'* The

Institute is to be administered by a Board of Governors which consists

of seven members representing state and local government, business and

industry, and environmental interests. '^^ The Board is to report biennially

to the General Assembly on the operations, findings, and recommen-

dations of the Institute. '^^ The Institute is scheduled to terminate July

1, 1994.^«^

F. Regulatory

Senate Enrolled Act 393'^^ prohibits the land application of used oil

to any ground surface without first obtaining a permit from the IDEM.^^^

176. Id. IND. Code 4-13.4-4-7.

177. 1989 Ind. Acts 527.

178. 1989 Ind. Acts 525.

179. 1989 Ind. Acts 528, Ind. Code. §§ 4-13.4-4-6 and 20-12-68.

180. 1989 Ind. Acts 1437.

181. Ind. Code Ann. § 13-7-22 (Burns Supp. 1989).
182. 1989 Ind. Acts 1450.

183. Ind. Code Ann. §§ 13-7-25-3, -4 (Burns Supp. 1989).
184. Id. § 13-7-25-5.

185. Id. § 13-7-25-6(b).

186. Id. § 13-7-25-7.

187. Id. § 13-7-25-13.

188. 1989 Ind. Acts 1427 (amending Ind. Code § 13-7-4-1) (1988).
189. Ind. Code Ann. § 13-7-4-1(14) (Burns Supp. 1989).



358 INDIANA LAW REVIEW [Vol. 23:329

Senate Enrolled Act 393 ^^^ amended Indiana Code section 1 3-7-8. 5-7(b)

which had required a generator of 1 ,000 kilograms or more of hazardous

waste in a month to submit to the Office of Solid and Hazardous Waste
Management of the IDEM a copy of the manifest that was created for
any transportation of the hazardous waste. Senate Enrolled Act 393^^^

changed this requirement so that it now appHes to generators of as little
as 100 kilograms or more of hazardous waste in a month. '^^ Senate

Enrolled Act 393^^^ also added a requirement that a manifest prepared

by and purchased from the IDEM must be used in the transportation
of hazardous waste to a treatment, storage, or disposal facility located

in Indiana. '^"^

Senate Enrolled Act 220'^^ amended Indiana Code section 13-7-8.6-

5 to allow a person who proposes to construct a hazardous waste or
low-level radioactive waste facility to apply for a certificate of environ-

mental compatibility from the Hazardous Waste FaciUty Site Approval

Authority before obtaining other required state or federal approval for

the facility. '^^ Previously, a person was required to obtain all other state

and federal approval before applying to the Authority.'^''

Senate Enrolled Act 220^^^ also added a requirement, which would

have become effective July 1, 1992, but was repealed by the 1990

legislature, concerning rules adopted by the Air Pollution Control Board,

the Water Pollution Control Board or the Solid Waste Management
Board. If a rule adopted by one of those boards had required a plan,

study, report, or other technical information prepared on behalf of a

person subject to the rule to be certified by a registered professional

engineer, the appropriate board would have required that the information

be certified by a hazardous materials manager certified by the Institute

of Hazardous Materials Management. ^^^

G. Agency Related

Senate Enrolled Act 548^^ amended Indiana Code section 13-7-13-

2 concerning the Environmental Management Special Fund. The Envi-

190. 1989 Ind. Acts 1429.

191. Id.

192. See Ind. Code Ann. § 13-7-8. 5-7(b) (Burns Supp. 1989).
193. 1989 Ind. Acts 1429.

194. Ind. Code Ann. § 13-7-8,5-7(0 (Burns Supp. 1989).
195. 1989 Ind. Acts 1432.

196. Id.

197. See Ind. Code § 13-7-8.6-5 (1988).
198. 1989 Ind. Acts 1431 (repealed by P.L. 19-1990).

199. Ind. Code Ann. § 13-7-7-7 (Burns Supp. 1989).
200. 1989 Ind. Acts 1435.



1990] INDIANA ENVIRONMENTAL LAW 359

ronmental Management Special Fund is a dedicated environmental fund

that may be used by the IDEM after approval of the Governor and the
State Budget Director.^^^ As amended, the statute now specifies that fees
collected by the Air Pollution Control Board, the Water Pollution Control

Board, and the Solid Waste Management Board are to be deposited in

the Environmental Management Special Fund instead of continuing to

be deposited in the State General Fund.^^^ Senate Enrolled Act 548 also

requires the Auditor of State to issue a report on the Special Fund every

four months. ^•'^ A copy of the report is to be forwarded to the IDEM
Commissioner, the standing committees of the Indiana House and Senate

concerned with the environment, the Environmental Policy Commission,

the Air Pollution Control Board, the Water Pollution Control Board,

and the Solid Waste Management Board.^^

House Enrolled Act 165(F^^ made several changes to the Wastewater
Revolving Loan Program. These changes included amending the Loan

Program to allow the Water Pollution Control Board to adopt emergency

rules to implement the Program,^^ and amending numerous sections of

Indiana Code 4-23-21 to allow loans to be made for the planning and
designing of wastewater systems, allow the IDEM to sell the creditor's
rights connected with the loans and to invest the money in the loan
fund in trusteed accounts, allow a political subdivision to issue and sell

notes to the IDEM, and allow the IDEM to enhance the obligations of
political subdivisions by granting money to be deposited in reserve funds,
paying bond insurance premiums or credit enhancement fees, or guar-

anteeing the obligations. ^°^

H. Air Pollution

House Enrolled Act 1837^°^ added a new chapter to the Indiana
Code concerning radon gas.^^ An individual now may not engage or
profess to engage in testing for radon gas or abatement of radon gas

unless the individual has been certified by the Indiana State Board of

Health (ISBH).^'^ Also, the ISBH is required to collect and disseminate

201. IND. Code § 13-7-13-2(a), (b) (1988).
202. See Ind. Code Ann. § 13-7-13-2(a) (Burns Supp. 1989).
203. Id. § 13-7-13-2(c).

204. Id.

205. 1989 Ind. Acts 2291.

206. See Ind. Code Ann. § 4-23-21 (Burns Supp. 1989).
207. Id.

208. 1989 Ind. Acts 335.

209. Ind. Code Ann. § 13-1-14 (Burns Supp. 1989).
210. Id. § 13-l-14-6(b).



360 INDIANA LAW REVIEW [Vol. 23:329

information concerning radon gas.^'' The Radon Gas Trust Fund was
established to pay the expenses of administering the chapter. ^'^

House Enrolled Act 1905^^^ revised the enforcement of the auto

emissions testing program required in Indiana counties that are not in

compliance with ozone air quality standards established by the EPA.^^"^

Currently, Clark, Floyd, Lake, and Porter Counties are not in compliance

with these standards. House Enrolled Act 1905 replaced the requirement

that stickers were to be displayed on a new vehicle to show the vehicle

was in compHance with emissions standards with the requirement that

a certificate of proof was to be issued and used to prove compliance. ^'^

Proof of compUance is now a condition for registering a vehicle with
the Bureau of Motor Vehicles (BMV) if the vehicle is located in a county
that has not attained the required ozone air quality level. ^^^ The BMV
must now suspend the registration of a vehicle in a nonattainment county
if the vehicle is not in compliance with emissions standards.

^^"^

House Enrolled Act 1905 repealed the law that required a vehicle

that was registered outside of a nonattainment area to be in compliance

with the emissions standards in the nonattainment area if the vehicle

travelled regularly in the area.^^^ House Enrolled Act 1905 also repealed

the civil penalties for noncompliance. ^^^

Senate Enrolled Act 505^^° defined clean coal technology as "a

technology that is used at an electric generating facility and directly or

indirectly reduces airborne emissions of sulfur or nitrogen based pollutants

associated with the combustion or use of coal and was not in use in

the United States as of January 1, 1989, or had been selected by the

United States Department of Energy for funding under the Innovative

Clean Coal Technology Program after December 31, 1988."^^* Senate

Enrolled Act 505 provides for recovery of preconstruction costs of clean

coal technology as operating expenses, construction work in progress

reimbursement for clean coal technology, amortization of clean coal

technology, and preapproval of clean coal technology by the Utility

Regulatory Commission. ^^^

211. Id. § 13-1-14-4(5).

212. Id. § 13-1-14-9.

213. 1989 Ind. Acts 1214-16.

214. Ind. Code Ann. §§ 13-1-1-6 to -12 (Burns Supp. 1989).
215. Compare Ind. Code § 13-1-1 l-l(b) (1988) with Ind. Code Ann. § 13-1-1-1 1(b)

(Burns Supp. 1989).

216. Ind. Code Ann. § 9-1-4-3.6 (Burns Supp. 1989).
217. Id. § 13-l-l-6(b).

218. 1989 Ind. Acts 1213. See Ind. Code § 13-1-1-1 1(a) (1988).
219. 1989 Ind. Acts 1213. See Ind. Code § 13-1-1-9 (1988).
220. 1989 Ind. Acts 113.

221. Id. Ind. Code 8-1-8.7-1.

222. Id.



1990] INDIANA ENVIRONMENTAL LAW 361

III. Future Legislation

In addition to the bills previously discussed, two bills with potentially

major environmental impact were introduced in 1989 but failed to pass.

One, Senate Bill 545, dealt with soHd waste management and the other,

House Bill 1910, dealt with underground storage tanks. ^^^

The introduced version of Senate Bill 545 would have required each

county, by itself or jointly, to form a solid waste management district

and adopt a district solid waste management plan. The bill would have

also imposed state fees on the disposal of soHd waste and required

IDEM to formulate a state soUd waste management plan. The basic
goal of both the district and state plans was to reduce the amount of

soHd waste being generated and reduce the amount of soHd waste being

disposed of in landfills.

The introduced version of House Bill 1910 would have specified the

IDEM and the State Fire Marshal to jointly operate the underground
storage tank program in Indiana. Also, the State Fire Marshal was to

establish a program to certify persons involved in underground storage

tank installation, testing, upgrading, and removal. This bill also would

have established a program to give financial assistance to owners and

operators of underground storage tanks to meet state or federal un-

derground storage tank requirements. Both of these bills were examined

by the Interim Study Committee on Environmental Issues during the

summer and fall of 1989 and will certainly be discussed during the 1990
Session.

IV. Conclusion

Despite an obvious increase in concern about environmental deg-

radation on the part of legislators and the general pubhc ahke, the state

government has, in large part, failed to either address the major en-

vironmental issues with effective legislation or to provide the state's

environmental agencies with sufficient staff or funding to effectively

administer existing programs. The legislature may also have inadvertently
weakened Indiana's environmental protection strategy by effectively de-

nying private citizen participation in the enforcement process. If there

is a ray of hope with regard to the future of environmental protection

efforts in Indiana, it may be that the state has begun, if hesitantly, to
pursue avenues other than traditional regulatory programs in an effort

to encourage environmental improvement while shifting the burden of

funding and administering such activity from the clearly inadequate state

223. Shortly before the printing of this Article, similar bills were passed by the

1990 Session of the General Assembly.



362 INDIANA LAW REVIEW [Vol. 23:329

mechanisms to private industry and individuals. Prime examples of that

approach are the "transaction-triggered" disclosure requirements of the

Responsible Property Transfer Law and the expanded restrictive covenant
provisions of Senate Enrolled Act 370, which aim at achieving envi-

ronmental compliance by restricting the alienability of property where

regulatory requirements have not been adequately observed. Other ex-

amples seen in 1989 legislation include "market-based" acts encouraging

recycling of paper and plastics and legislation intended to encourage

clean coal technology. As noted by former EPA administrator Lee
Thomas, "there are limits to how much environmental improvement can
be achieved under these [control] programs, which emphasize management

after pollutants have been generated. "^^'^ For that reason, EPA's policy
has shifted to pollution prevention rather than pollution control.

While the legislature's willingness to turn to somewhat innovative

approaches to environmental protection must be applauded, the legislators

must realize that disclosure documents and codes on plastic bottles cannot,

by themselves, lift Indiana from the cellar it occupies in many national
environmental quality rankings. A more comprehensive package of plan-
ning, creativity, initiative, and financial support of the regulatory struc-

ture sufficient to allow effective administration of existing law must be

provided if Indiana is to see improvement in its national standing with

regard to environmental protection, or, more importantly, improvement

of our land, air, and water.

224. Commoner, "Why We Have Failed," Greenpeace 12-13 (September/October
1989) (quoting L. Thomas, "Pollution Prevention Policy Statement" (unpublished)).