Senate To Vote on $600-Million for Asbestos Control

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A $600-million, seven-year program to fund asbestos removal in public and private schools will be considered by the U.S. Senate some time in the next few weeks, and its sponsors are cautiously optimistic that it will win the votes needed for passage.

Senator James Abdnor, Republican of South Dakota, is the main sponsor of the measure, filed earlier this month as an amendment to S757, the solid-waste-disposal amendments of 1983. The Senate is expected to take up that bill--the major environmental bill of the current session--late this week or early next week. The House passed its version of the solid-waste bill earlier, without an asbestos amendment.

The filing of the amendment coincided with several other major developments on the problem of asbestos in the schools. Late last week, a federal district judge in Philadelphia refused to vacate an earlier order that certified, or established, a "mandatory class" of school-district plaintiffs in suits against three of the 54 companies named in the class action.

The judge's move apparently means that all school districts are members of the class, and those who want to sue the three firms--which are the nation's largest manufacturers of the substance--must do so as part of the class action.

The order both halts further action on existing cases against the three companies and prohibits the filing of new ones. Any district seeking to recover damages against the companies must do so as part of the class action. The three defendants are U.S. Gypsum, National Gypsum, and W.R. Grace. U.S. Gypsum alone has 27 school suits pending against it, a spokesman said.

And earlier this month, in the first settlement of a suit by a school district against an asbestos company, U.S. Gypsum agreed to pay $678,000 to the Lexington County (S.C.) School District.

Meanwhile, the Environmental Protection Agency is continuing to cite and fine school districts that have not met the requirements of the agency's inspection and notification rule.

And at least one state, California, is considering legislation that would provide money for asbestos removal in the schools.

Shift of Agencies

The new hope for federal funding comes more than four years after the Congress passed the Asbestos School Hazard Detection and Control Act of 1979. That act authorized funding for inspection and removal of asbestos, but lawmakers never appropriated any money. The programs established by that bill were administered by the Education Department.

The asbestos-abatement amendment that the Senate will vote on would shift the authorization for asbestos-control funds from the Education Department to the Environmental Protection Agency. An aide to Senator Abdnor said the sponsors favored the shift both because the epa has far greater technical expertise in asbestos control, and because the program would then compete for funding with other environmental health programs, rather than education programs.

Under the program, the federal government would provide $50 million in no-interest loans and grants during the fiscal years 1984 and 1985, and $100 million in each of the subsequent five years.

"We think it looks really good," the aide said of the bill's chances for passage in the Senate. The sponsors, who include senators from both parties, many with a strong interest in education, worked with members of the House and representatives of the education community to devise an acceptable program.

Schools with demonstrated need would be eligible to receive the funds, but would be limited to 50 percent of the cost in grants, and another 50 percent in loans. The measure contains special language requiring the agency to carry over any unspent 1984 funds to 1985, since it is unlikely that $50 million could be allocated during the remainder of this fiscal year. Senator Abdnor's aide said that the sponsors sought to balance the epa's need for time to set up the program against the schools' need for asbestos-removal money.

Mandatory Class

The class action in Philadelphia is a consolidation of two other suits filed separately, one involving several school districts and the other involving only one.

In all class actions, the court must "certify" a class, the members of which will be represented in the suit. Most commonly, those identified as members of the class--school districts, in this case--may choose whether to join the suit or file their own. By contrast, in a mandatory class no members of the class would be able to exclude themselves.

On March 9, a lawyer representing one group of schools filed a motion and briefs asking the judge to certify a mandatory class; the lawyer also asked for an "opt-out" suit, in which plaintiffs may decide whether or not to become part of the suit. Three of the 54 companies named in the suit agreed that they would not oppose the certification of a mandatory class, according to Lawrence T. Hoyle, a lawyer representing National Gypsum in the case. The remaining 51 had not yet taken a position on the issue, Mr. Hoyle said.

On April 13, the judge agreed to certify the mandatory class, pending a final ruling at a hearing scheduled for May 9.

Disagreement on Efficacy

But lawyers for other plaintiff school districts--as well as some defendants--did not agree that the mandatory class was the best way to proceed, and sought to have the judge's order vacated. On April 19, the judge refused to do so.

Mr. Hoyle cited numerous advantages of the mandatory class for both plaintiffs and defendants, although he, like other lawyers interviewed, could cite no precedent for its establishment. "We believe there are enormous advantages to dealing with these cases in a single forum," Mr. Hoyle said. "It provides a single forum in which you can fairly and efficiently litigate the issues involved. It should be more cost-effective for parties on both sides. The judge will regulate fees charged to class members. It makes the litigation more manageable. It's an innovative effort to try to deal with the school cases in a different way than the personal-injury cases that have plagued the courts."

Some lawyers representing schools, however, argue that not all districts would be adequately represented in such an action. They contend that the companies are seeking the change because, if the court rules against them, the overall cost will be less than it would be if they had to make good on a large number of individual districts' suits.

"I personally believe there may be some grounds for dealing with this on on a bigger scale, but there are no grounds for making it mandatory," said Terry Richardson, a South Carolina lawyer involved in many school districts' suits. It is "just and fair" to have a class action that ensures equal treatment for all involved, he noted.

"But it certainly doesn't mean I want to be ordered to go to Philadelphia and take whatever I get."

At the May 9 hearing, the judge will make a final ruling on the certification of the class.

Favorable Sign

Last week's activity in the Philadelphia suit complicated an already murky legal situation, lawyers note. Nevertheless, those representing school districts view the out-of-court settlement reached by U.S. Gypsum and the Lexington County schools as a hopeful sign that other districts may also recover the cost of removing asbestos.

At least 40 cases filed by school districts are now pending, according to lawyers around the country.

"I certainly think that it will help tremendously," Mr. Richardson said. "My official comment has always been that while each case must be judged on its own merit, school districts should be encouraged by this result," said Daniel S. Speights, the Hampton, S.C., lawyer who represented the school district. "At least it shows that some cases can be won. The first case is always an important case."

More Suits

The number of school systems that have filed suit against asbestos manufacturers and processors has grown significantly since 1981, when the U.S. Attorney General issued a report recommending that schools file such suits to recover the costs of removing the potentially hazardous substance. (See Education Week, Oct. 5, 1981.)

A second surge of filings took place this year, according to lawyers involved in such actions. "There's been a great deal more interest in this avenue since June 1983, the deadline for complying with the Environmental Protection Agency's regulation," said Mr. Speights, who represents between 10 and 20 other districts in similar suits and is investigating possible litigation for others.

The epa rule required school districts to inspect for friable, or crumbling, asbestos by June 28, 1983. If they found it, they had to either remove or control it by the deadline, or notify parents and school personnel of its presence if the problem was still present after the deadline.

South Carolina Case

The school district involved in Lexington County School District v. U.S. Gypsum spent $378,000 to remove asbestos ceilings from Irmo Senior High School in 1981, Mr. Speights said. In its complaint against U.S. Gypsum, the school district sought both actual and punitive damages.

The product in question was a spray-on ceiling system that contained "a small amount of asbestos," according to U.S. Gypsum, a Chicago-based company that manufactures gypsum-based building products.

The company has not manufactured the ceiling spray since 1972. Currently, 27 suits filed by school districts are pending against U.S. Gypsum, but company officials would not say whether other out-of-court settlements were planned.

"About the only general statement that we could make is that we still believe that our product is not hazardous in schools, [if] properly installed and maintained, and we plan to vigorously defend other cases," said Paul Colitti, manager of public relations for U.S. Gypsum.

Mr. Hoyle, the lawyer for National Gypsum, added that the three companies involved in the mandatory action in Philadelphia still oppose the substance of the charges filed against them. "We do not believe that the mere presence of asbestos in a school building consti-tutes a hazard," he said.

New Carolina Suit

U.S. Gypsum is also a defendant in the next case scheduled to be tried, now slated to reach the U.S. District Court for the District of South Carolina in July, according to Mr. Speights. That case, Greenville County School District v. W. R. Grace, involves about 35 school buildings, and asbestos-control costs of more than $4 million.

Officials in other districts that have filed suit say they are not expecting a quick resolution of their cases.

In Los Angeles, where the school system filed a $250-million suit against more than 40 companies, a spokesman said lawyers anticipated no settlement for several years. A lawyer at the firm of Greene, O'Reilley, Agnew, and Broillet said other school districts have contacted the firm about possible suits, but as yet they are representing only Los Angeles.

'Viable' Case in Philadelphia

In Philadelphia, the district's $17.7-million suit progressed after initial delays because of the Manville Corporation's bankruptcy proceedings. Manville has been removed from the case, which is being heard in the Court of Common Pleas in Philadelphia.

The court ruled earlier that the district's case was a "viable cause of action under state law," according to a lawyer for Raynes, McCarty, Binder, and Mundy, the firm representing the district. In June, the participants will hold another status conference on the case, School Distict of Philadelphia v. Owens-Corning Fiberglass Corporation.

The suits are often costly to file, and frequently involve lengthy periods of investigation before the complaint can be filed, according to lawyers. Investigators must first identify the product involved, which can be difficult depending on the age of the building and the condition and availability of building records.

The suits generally seek to recover actual damages: the cost of inspection, laboratory analysis to see whether the suspect material is asbestos, removal, replacement, and architectural fees, and "consequential costs" that result from the disruption of construction--moving classes to another location, for example.

Growing Pressure on Districts

Although the successful settlement of one suit may indicate that companies will indeed be held liable for costs, many school officials point out that they need the money to pay for removal now, not in 10 years. Not only is public pressure to remove asbestos increasing, but some schools that have not complied with the epa rule are being cited and fined by the agency.

As of March 30, the most recent date for which statistics are available, the epa had issued 238 notices, a spokesman for the agency said.

Philadelphia, notified that it would be fined $12,000 for failing to post notices in what the epa viewed as appropriate locations about the presence of asbestos, has contested the fine. District officials point out that they put the notices in areas where teachers sign time cards, which is as close to being a common area as all the schools have.

The district's complaint will be heard and decided on by the epa If school officials are dissatisfied with the agency's ruling, they may take their case directly to the federal courts.

Hearing Scheduled

The agency will also convene a public hearing on the asbestos-in-the-schools rule on May 7 in Washington.

Education groups are expected to ask the agency to set a rule requiring school districts to tighten the notification process, and also to require removal of the asbestos if a hazard is found.

Arnold Fege, director of government relations for the National Congress of Parents and Teachers said the pta and other education groups are preparing testimony for the epa hearing.

The hearing was announced after the agency reopened the rule-making process in response to a petition filed by the Service Employees International Union. The petition sought to reopen the rule-making process because the union, like many other groups, contends that the current rule does not protect workers and children from asbestos exposure.

Surveys by the epa have found that 60 percent or more of the schools surveyed had not complied with some part of the regulation, often the notification requirement.

A limited survey conducted this spring by the pta the supports the epa data, according to the association. Although the relatively small return rate on the survey makes the results less than definitive, Mr. Fege said there seemed to be a non-compliance rate of 60 to 80 percent of schools. "The key is money, there's just no question," Mr Fege said. "No one wants to own up to the responsibility for cleanup."

Budgetary Dilemmas

In many districts, the money for cleanup will have to come from the budget for instructional programs, school officials have said. And in the majority of states and districts, officials are simultaneously being pressed to improve instruction.

In California, for example, a state survey found that about 3,000 of the state's 7,000 public-school buildings contained friable, or crumbling, asbestos, with the overall cost of cleanup estimated at somewhere between $73 million and $90 million. About 1,561 of the buildings still contain the asbestos.

At the request of Bill Honig, California's superintendent of public instruction, Assemblyman Gray Davis has introduced a bill that would provide $45 million in state funds to help pay for asbestos cleanup.

The bill has been approved by the Assembly's education policy committee, and will be voted on next by the Ways and Means Committee, according to an aide to Mr. Davis, a Democrat from Los Angeles.

The bill also requires that schools wishing to receive the money must have the asbestos inspection done by a qualified inspector, according to the aide. He noted that the bill has had good support thus far; in the policy committee, the only debate was on the best way to inspect for and control the asbestos, not whether the problem needed money and attention.

Vol. 03, Issue 31

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