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Case Summary: 2010 MLC (General Motors) Bankruptcy Settlement

On October 20, 2010, the U.S. Environmental Protection Agency (EPA), the U.S. Justice Department (DOJ), and the Unites States Attorney for the Southern District of New York (USAO-SDNY), along with the states of Delaware, Illinois, Indiana, Kansas, Louisiana, Massachusetts, Michigan, Missouri, New Jersey, New York, Ohio, Pennsylvania, Virginia, Wisconsin and the Saint Regis Mohawk Tribe announced that Motors Liquidation Corporation (MLC) had agreed to resolve its liabilities at 89 sites in the aforementioned 14 states across the U.S. for approximately $773 million.

The agreement settles certain proofs of claim of the U.S., the states and the tribe in the General Motors Corporation bankruptcy case relating to liabilities under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA, also known as Superfund), the Resource Conservation and Recovery Act (RCRA), and the Clean Air Act (CAA).

The bankruptcy settlement set up a $773 million Environmental Response Trust (the Trust) to conduct, manage, and fund cleanup at 89 owned sites where MLC has liabilities. The bankruptcy settlement also envisions the redevelopment of the appropriate sites in the Trust.

Additional Settlements Agreements in 2011: In March 2011, the government announced that six additional settlement agreements reached after the initial October 2010 bankruptcy settlement and filed in December 2010 were approved by the Bankruptcy Court for the Southern District of New York.  The court approved the additional settlement agreements on March 3, 2011. On March 4, 2011, the government announced that a seventh settlement agreement reached after the initial October 2010 bankruptcy settlement was filed with the same bankruptcy court. Information on the seven additional agreements are available on the 2011 overview of MLC bankruptcy settlement agreements web page.

Additional Settlement Agreements in 2012: In January and May, 2012, the government filed additional settlement agreements with the United States Bankruptcy Court for the Southern District of New York to resolve environmental claims against Motors Liquidation Company at several Superfund sites. From these settlements, EPA received additional funds to settle environmental claims at these sites, as well as cleanup work performed by third parties. The government also filed a stipulation with the court to apply a tax set off of $17.3 million for money owed by the government to New GM so that amount would be paid to EPA for the Lower Ley Creek portion of the Onondaga Lake Site at 100 cents on the dollar rather than in New GM stock and warrants. Information on the 2012 settlement agreements is available on the 2012 overview of MLC bankruptcy settlement agreements web page.

"We're happy to have a path forward that addresses the needs of former auto communities. This trust - the largest environmental trust in our history - provides support for aggressive environmental cleanups at these sites, which will create jobs today and benefit the environment and human health over the long-term." - Lisa Jackson, Administrator

On this page:

Overview of the Company

Motors Liquidation Corporation (MLC) is the business entity formerly known as the General Motors Corporation ("Old GM"). From 1908 through 2009, General Motors Corporation was an auto-manufacturer based in Detroit, MI.

On June 1, 2009 Old GM filed for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York. On July 5, 2009 the Bankruptcy Court approved the sale of most of Old GM’s assets to NGMCO, Inc., which later became known as General Motors Company ("New GM"). Old GM retained certain real property from the sale to New GM.

After the sale of assets to New GM, Old GM was renamed MLC, which is the holding company created to settle past liabilities of the Old GM.

Once the United States Bankruptcy Court for the Southern District of New York confirmed the bankruptcy plan on March 29, 2011, MLC was carved into four trusts:

  • Trust to settle the claims of unsecured creditors,
  • Trust to handle the environmental cleanup of MLC's remaining assets (the "Revitalizing Auto Communities Environmental Response Trust"),
  • Trust to handle present and future asbestos-related claims, and
  • Trust to handle litigation claims.

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Background information on the bankruptcy proceedings

On June 1, 2009, Old GM and three of its affiliates filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code (the “Bankruptcy Code”) in the U.S. Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”). The debtors’ cases are being jointly administered in the Bankruptcy Court and are collectively referred to as the “Bankruptcy Cases.”

On June 1, 2009, Old GM also filed a motion to approve the sale of substantially all of its assets pursuant to the sale provision of the Bankruptcy Code. On July 5, 2009, the Bankruptcy Court approved the sale of assets to NGMCO, Inc. (a/k/a Newco), later known as General Motors Company (“New GM”).

On November 28, 2009, DOJ filed Proofs of Claim (POC) on behalf of the EPA, the Department of Interior (DOI), and the National Oceanic and Atmospheric Administration (NOAA), alleging that it had incurred past response costs and may incur future response costs under CERCLA at specified properties owned by Old GM. The United States also alleged that Debtors have liabilities in connection with several properties to implement closure, post-closure work, corrective action, and to perform any necessary action pursuant to any imminent and substantial endangerment to health or the environment as required by RCRA. EPA’s claims are mostly attributable to estimated future response costs.

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Overview of the October 2010 settlement agreement

MLC has agreed to transfer ownership in 89 properties to an Environmental Response Trust (ERT or “Trust”). The Debtors will initially fund the trust with $773 million in cash and other assets. The Trust will perform cleanup work pursuant to budgets approved by the lead agencies and reimburse the government. The funding represents the most likely cost of cleanup based on available information.

The Environmental Response Trust will consist of the following:

  • Minimum Estimated Property Funding Account containing $295 million;
  • Reserve Property Funding Account containing $52 million;
  • Long Term OMM Property Funding Account containing $84 million;
  • Cushion Funding Account containing $68 million;
  • Administrative Funding Account containing $232 million; and
  • Administrative Funding Reserve Account containing $40 million.

MLC already paid $11.5 million for cleanup costs incurred through June 30, 2010 at the 89 owned properties.

Minimum Estimated Property Funding Account: This account of approximately $295 million will fund response, remediation, and oversight, as well as any other activities required under law in connection with the 89 properties. Funding for each site will be held in segregated site-specific trust subaccounts.

Reserve Property Funding Account: This account of approximately $52 million will fund response, oversight and operations/maintenance costs as defined under CERCLA in connection with the 89 properties upon the exhaustion of the Minimum Estimated Property Funding Account. Funding for each site will be held in segregated trust subaccounts.

Long Term Operation Monitoring and Maintenance (OMM) Funding Account: This account of approximately $84 million will fund OMM activities in connection with the 89 properties, beginning 10 years after the effective date of the settlement and trust agreement. Funding for each site will be held in segregated trust subaccounts.

Cushion Funding Account: The cushion account funds cleanup activities at any of the 89 properties when the original and reserve funding accounts for such properties have been exhausted. A total of approximately $68 million will be held in a pooled account and the Trustee, with input from the lead agencies will decide which properties qualify for this cushion funding based on specified factors. Generally, this funding will be used to address unforeseen contamination at a property.

Administrative Funding Account: This account funds the costs necessary for the administration of the Trust and administrative costs related to the 89 properties, including personnel costs, legal fees, security, utilities, property taxes, non-environmental demolition costs, and other similar expenses. Approximately $232 million in cash and other assets will be placed in the Trust to cover these expenses.

Administrative Funding Reserve Account: Due to concerns that there may be shortfalls in the Administrative Funding Account, MLC and the U.S. Department of the Treasury agreed to place $40 million in a reserve account which allows the trustee to fund actual or expected shortfalls in the Administrative Funding Account.

The proposed framework of the settlement and trust agreement is the result of a rigorous and concerted effort by the federal government, with input from its state and tribal partners, to determine the likely cost of cleaning up each of the 89 owned properties, the terms and structure of the Trust, and the selection of the trustee.

In addition, the settlement and the Trust place an emphasis on community involvement and productive reuse, that will enable the trustee to potentially redevelop, sell and/or transfer the properties back to the communities for productive use, and ensure that the impacted communities are engaged in this process.

The properties to be managed are:

EPA Lead Sites
Site Name State Funding
1-Acre Fire Suppression Lot* IN $0
Former GM Delco Plant 5 IN $7,268,319
Various Bedford Town Sites (60 contiguous properties counted as one site) IN $4,017,597
Venture 2000 Property* IN $0
607 Meadow Drive MI $0
631 Meadow Drive MI $0
642 Meadow Drive MI $0
652 Meadow Drive MI $0
Centerpoint Land (Etkin ground lease) MI $0
Centerpoint Land (no Etkin ground lease) MI $0
Chevrolet-Pontiac-Canada Pontiac Fiero Assembly Plant MI $839,741
Delphi C Livonia Coil & Bumper MI $0
Dort Highway Land MI $528,634
Fiero Site (Powerhouse) MI $0
Flint Flow-through Warehouse MI $0
Flint West - Flint River (Bluff Street) MI $3,186,069 
GMPT - Flint North #5/#10/#81 MI $0
GMPT – Livonia MI $1,861,394
GMVM - Pontiac Assembly MI $0
Midsize & Luxury Car Clark Street* MI $0
PCC-Validation MI $470,639
PCC Validation Southern Parking Lot MI $0
Pontiac Centerpoint Campus - Central* MI $0
Pontiac Centerpoint Campus - East* MI $0
Pontiac Centerpoint Campus - West MI $215,981
Textile Road Land MI $160,789
Vacant Land (76 acres) MI $20,924
Vacant Land South of Van Born (68 acres) MI $3,210,644
Massena NY $120,860,604
Delphi Harrison - Moraine OH $25,759,964
GMPT - Toledo 103C Landfill OH $2,634,063
Moraine Assembly* OH $0
Moraine Lagoon* OH $0

More site specific information is available on the 2010 Settlement Site Information: EPA Funded Sites and Communities Web page.

State Lead Sites
Site Name State Funding Amount
GMNA Car – Wilmington DE $11,728,473
GMPT - Danville Landfill IL $5,258,489
Allison Gas Turbines IN $1,668,107
Delphi I - Anderson/Monroe IN $2,811,565
Manual Transmission of Muncie IN $5,695,448
Metal Fab - Indianapolis IN $3,713,446
Fairfax I Plant KS $4,786,321
Fairfax Parking Lot* KS $0
GMVM - Shreveport Assembly (exclude Stamping)* LA $0
MCD - Framingham Landfill MA $2,325,836
1394 Oak Hollow (residence)* MI $0
1831 Grondinwood (residence)* MI $0
6560 Cass Ave/GMNA New Center Complex  MI $59,107
ACC - Penske site MI $150,495
Davison Road Land MI $612,280
Delphi C - Livonia Groundwater MI $6,669,037
Delphi I - Coldwater Rd. (Landfill) MI $4,250,661
Delta Engine Plant* MI $0
Employee Development Center MI $1,213,426
Former Howard W/H - Vacant Land  MI $248,252
GLTC land (Atherton Landfill/Die Lot Parking) MI $223,394
GMNA - Buick City MI $32,959,117
GMNA Car (Fisher Body) - Lansing MI $7,736,956
GMNA Car - Lansing 2 MI $5,509,240
GMNA Car - Lansing 3 MI $5,385,566
GMPT Bay City MI $3,526,770
GMPT Saginaw Malleable MI $10,725,985
GMPT - Willow Run MI $35,779,454
Greenpoint Landfill MI $1,774,460
Hemphill Lot MI $1,779,650
Land along Stanley Road* MI $0
Linden Road Landfill MI $167,523
Lot 8 - 6241 Cass Avenue at Amsterdam Ave. MI $124,382
Midsize & Luxury Car - Willow Run MI $7,573,707
Peregrine - Coldwater Rd. (plant) MI $1,471,173
Pontiac North MI $11,015,247
Powertrain - Romulus Engineering Center MI $276,029
Saginaw Nodular Iron (PIMS297) MI $4,668,779
Saginaw PLt 2 Landfill MI $374,204
Stamping - Grand Rapids MI $3,785,208
Willow Run Engineering Center* MI $0
Windiate Park Lots MI $143,971
Former Leed's Assembly Plant - Northern Parcel MO $1,724,806
Former Leed's Assembly Plant - Southern Parcel* MO $0
Hyatt Clark Industries NJ $14,176,022
Delphi Interior & Lighting Systems - Trenton NJ $10,532,047
GM-IFG Syracuse NY $31,121,812
Ley Creek PCB Dredging Site NY $1,882,342
Tonawanda Engine Landfill* NY $0
Delphi Interior – Elyria OH $7,263,306
Stamping – Mansfield OH $2,990,952
GMPT - Parma Complex OH $746,705
Lordstown Excess Land* OH $0
Metal Fab - Pittsburgh PA $3,299,231
Janesville Training Center WI $210,857
GMPT - Fredericksburg VA $25,922

* Twenty-nine of the above referenced sites are listed with a funding amount of $0. Currently, environmental remediation is not planned at these sites. However, should new information arise or should conditions change that require environmental remediation, the sites are eligible for monies from the Cushion Funding Account.

This Settlement affects only the specified 89 properties and sites. It does not affect the POCs filed against MLC by the United States and various states relating to sites other than the 89 properties and sites at issue. Also, it does not affect the general unsecured claims held by the United States against MLC for past costs and natural resource damages relating to the properties that are being placed in the trust.

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Comment period

The MLC settlement, filed with the U.S. Bankruptcy Court for the Southern District of New York, was subject to a 30-day public comment period and final court approval.

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Contact Information

Hiral Shah

Bob Roberts

U.S. Environmental Protection Agency
1200 Pennsylvania Avenue, NW
Washington, D.C. 20460

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