5.11 ERMUSR 11-14-2023Elk River
Municipal Utilities UTILITIES COMMISSION MEETING
TO:
FROM:
ERMU Commission
Mark Hanson — General Manager
MEETING DATE:
AGENDA ITEM NUMBER:
November 14, 2023
5.11
SUBJECT:
PFAS Litigation Settlement
ACTION REQUESTED:
Motion to Direct Staff to Remain in Class and File Claim Forms
Motion to Engage Legal Counsel and Approve Retainer Agreement
BACKGROUND:
ERMU has received notice of a class action settlement of various claims against chemical
companies for the proliferation of Perfluoroalkyl and polyfluoroalkyl substances (PFAS) in public
water systems. This settlement arises out of multi -party, multi -district litigation venued in
South Carolina. The Settling Defendants have agreed to pay $1,185,000,000.00, subject to final
settlement approval of the Court.
If an eligible water system (such as ERMU) does not opt out by the deadlines (Dec. 4, 2023, for
DuPont; Dec. 11, 2023, for 3M), it will automatically be included in the settlements and will be
precluded from bringing its own lawsuit against DuPont or 3M for PFAS damages.
DISCUSSION:
Eligible water systems with detected PFAS in at least one source and that do not opt out will
have to submit a claims form to receive their share of the settlement fund. For entities that did
not opt out of the settlement, they will have only 60 days after final approval of the settlement
to submit their claims form otherwise they will not receive payment if they are a phase one
eligible claimant (utilities that have detected PFAS before the settlement date). There are also
phase two eligible claimants which are public water systems that have not detected PFAS
before the settlement date but are either required to test drinking water for PFAS
contamination pursuant to Unregulated Contaminant Monitoring Rule 5 or by serving more
than 3,300 people according to the Safe Drinking Water Information System.
An eligible entity that opts out of the class settlement will not be eligible to receive any
payment from this settlement. However, a system that opts out will not be precluded from
bringing a lawsuit against DuPont or 3M for damages caused by PFAS contamination. Parties
that do not wish to be a Settlement Class Member, and do not want to participate in the
Settlement, may opt out by completing and mailing a notice of intention to opt -out.
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Under the timelines, eligible water systems will not be able to see how much money they are
entitled to under the class settlement until after deciding whether to participate. Eligible water
systems who have already detected PFAS in at least one source, and who don't opt out of the
settlements, must submit a claims form containing data about their PFAS impacts after final
approval. These forms will be processed by a claims administrator who will ultimately
determine each participating system's share of the settlement fund. The claims administrator
has begun operating a website at the following URL: https://www.pfaswatersettlement.com/.
ERMU is a phase one eligible claimant. In November 2021, the Minnesota Department of Health
(MDH) tested each of our eight wells for PFAS (see attached results report). Well Four was the
only well with a detectable amount of a PFAS contaminant, 0.0014 ug/L of PFBA, far below the
listed MDH guidance value of 7.0 ug/L. Per the MDH report, a person drinking water at or below
the guidance value would have little or no risk for health effects.
Additionally, there are multiple defendants and types of claims in the multi -district litigation.
Lockridge Grindel Nauen (LGN) is serving as local counsel in this litigation and would be able to
file claims on behalf of ERMU to protect its interests relating to future settlements. Staff
recommends engaging LGN on behalf of ERMU on a 25% contingency fee basis.
FINANCIAL IMPACT:
None. Since the retainer is set up on a contingency fee basis, Lockridge Grindel Nauen is only
paid if a settlement is received.
ATTACHMENTS:
• PFAS Sampling Report
• LGN Litigation Retainer Agreement
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