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LFR Levine-Fricke PRELIMINARY NONBINDING ALLOCATION OF RESPONSIBILITY Health and Safety Code section 25356.1, subdivision(e)requires the Department of Toxic Substances Control(DTSC)to prepare a nonbinding preliminary allocation of responsibility (the ANBAR=) among all identifiable potentially responsible parties (PRPs). Health and Safety Code section 25356.3, subdivision(a)allows PRPs, with an aggregate allocation in excess of 50 percent of the costs of removal and remedial actions, to convene an arbitration proceeding by submitting to binding arbitration before an arbitration panel. If PRPs with over 50 percent of the allocation convene arbitration, then any other PRP wishing to do so may also submit to binding arbitration. The sole purpose of the NBAR is to establish which PRPs will have an aggregate allocation in excess of 50 percent and can therefore convene arbitration if they so choose. The NBAR, which is based on the evidence available to the DTSC, is not binding on anyone, including PRPs, DTSC, or the arbitration panel. If a panel is convened, its proceedings are de novo and do not constitute a review of the provisional allocation. The arbitration panel=s allocation will be based on the panel=s application of the criteria set forth in Health and Safety Code section 25356.3, subdivision(c)to the evidence produced at the arbitration hearing. Once arbitration is convened, or waived, the NBAR has no further effect, in arbitration, litigation or any other proceeding, except that both the NBAR and the arbitration panel=s allocation are admissible in a court of law, pursuant to Health and Safety Code section 25356.7 for the sole purpose of showing the good faith of the parties who have discharged their obligations under the arbitration panel=s decision. DTSC sets forth the following nonbinding preliminary allocation of responsibility for the former Royster Tire Re-cycling Facility (a.k.a. Tracy Tire Fire Site), located at 29425 South MacArthur Drive, Tracy, California. The Royster Tire Re-cycling Facility ceased operation in 1998. Silas F. Royster was the property owner until his death in 1999. The Estate of Mr. Silas F. Royster is the current property owner. The Estate of Mr. Silas F. Royster is allocated 100 percent responsibility. Final_RAP_Tracy_9.18.03(fina1).doc:LFR Page C-1