EPA's PFAS CERCLA Designation And Its Impact On EPA Brownfields Grant Funding

Highlights

• The U.S. Environmental Protection Agency (EPA) recently answered questions related to the designation of two per- and polyfluoroalkyl substances (PFAS) – perfluorooctanoic acid (PFOA) and perfluorooctane sulfonic acid (PFOS) – as Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) hazardous substances.
• The published FAQs also explain that EPA Brownfields Grant recipients are required to demonstrate they cannot be held potentially liable for PFOA or PFOS contamination under CERCLA Section 107.
• This Holland & Knight alert explores how the EPA's designation will impact how EPA Brownfields Grants can be used to address PFAS contamination.

The U.S. Environmental Protection Agency (EPA) on April 17, 2024, announced the designation of two per- and polyfluoroalkyl substances (PFAS) – perfluorooctanoic acid (PFOA) and perfluorooctane sulfonic acid (PFOS) – as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). (See Holland & Knight's previous alert, "PFAS Designation Rule Will Impact Operational Compliance, Enforcement, Litigation and Policy," Nov. 25, 2024.) The rule became effective on July 8, 2024. Prior to their designation as CERCLA hazardous substances, PFOA and PFOS fell within the CERCLA definition of "pollutants or contaminants."

Under CERCLA Section 101(39), a "brownfield site" includes sites contaminated by a "hazardous substance, pollutant, or contaminant." Therefore, the EPA's designation of PFOA and PFOS as hazardous substances does not change whether EPA Brownfields and Land Revitalization Program resources, including grants, can be used to address PFOA and PFOS. Applicants were already authorized to use Brownfields Grant funding to assess and clean up PFOA and PFAS contamination prior to the designation.

On Sept. 17, 2025, the EPA announced its intent to retain this designation and to develop a "CERCLA Section 102(a) Framework Rule" governing future CERCLA hazardous-substance designations. (See Holland & Knight's previous alert, "EPA's PFAS Rulemaking Trajectory: Key Updates Across CERCLA, TSCA, RCRA, SDWA and CWA" Oct. 7, 2025.)

Now, with PFOA and PFOS being designated as CERCLA "hazardous substances," Brownfields Grant recipients who wish to use EPA funding to clean up PFOA- or PFOS-contaminated sites must first demonstrate that they cannot be held potentially liable under CERCLA Section 107.

In a response to FAQs, the EPA clarified that All Appropriate Inquiries (AAI) investigations conducted on a Brownfield site must now evaluate indications of releases of threatened leases of PFOA or PFOS to establish liability protection under CERCLA. The AAI Final Rule, 40 C.F.R. Part 312, provides that the American Society for Testing and Materials (ASTM) standard for environmental site assessments (ESA), E1527-21, is consistent with the requirements of the final rule and can be used to satisfy the statutory requirements for conducting AAI. Appendix X6.10 of ASTM E1527-21 clarifies that "hazardous substances" are limited to those compounds identified as hazardous substances under CERCLA. Prior to the EPA's designation, PFAS substances were treated as "emerging contaminants," addressed as "non-scope items," similar to asbestos, radon, lead paint and mold.

Appendix X6.10 of ASTM E1527-21 further provides that "[i]f and when such emerging contaminants are defined to be a hazardous substance under CERCLA, as interpreted by EPA regulations and the courts, such substances shall be evaluated within the scope of this practice." In issuing the answers to FAQs, the EPA clarified its intent for the designation to have a profound effect on CERCLA liability and access to EPA's Brownfields Grant funding.

Conclusion

Though it is now clear based on the FAQs that the EPA's designation necessitates changes in the approach to satisfying AAI utilizing ASTM E1527-21, based upon Holland & Knight's review of dozens of Phase I ESAs, many assessments completed in the past few months would not be considered to be sufficient to satisfy the AAI test in order to obtain access to EPA Brownfields grants.