ABSTRACT OF THE THESIS Toxic Materials and Groundwater Contamination In Southern New Jersey: The Concept of Net Risk Analysis by MARVIN WATERSTONE, Ph.D. Thesis Director: Professor J. Kenneth Mitchell Many environmental problems facing the United States, and other nations, require the allocation of limited resources for their amelioration. In order for such resources to be allocated effectively, it is usually necessary to utilize a procedure that sets priorities in a systematic way, frequently based upon assessments of risks and benefits. When dealing with issues of environmental pollution, such priority-setting systems often are based upon an assessment of potential risks and benefits. This research hypothesizes that the methodology utilized in most environmental risk assessments is inadequate because it fails to examine the ability of groups or individuals to respond to environmental threats. Without an explicit consideration of this response capability, communities (or individuals) may be viewed as equally at risk, when their risk situations may be completely different, a fact with important implications for the allocation of resources to deal with environmental problems. In this study, the usual type of risk assessment has been termed an "objective risk assessment." By contrast this study develops and applies the new concept of "net risk analysis," which includes not only the components of objective risk (which focuses on physical aspects of a threat and potential consequences), but also factors related to response capability (perception of an environmental threat, recognition that it is a threat, knowledge of options for coping with the threat, and an ability to implement such options). This concept of net risk analysis is applied to the specific problem of contamination of potable groundwater supplies by toxic chemicals. This problem is really two-fold. The first aspect relates to the issue of cleaning up existing improper disposal sites. The second part of the issue concerns the siting of future, safe hazardous waste management facilities. This study presents a net risk analysis of both aspects of this problem for 212 municipalities in southern New Jersey. The study was based on three working hypotheses: 1) that an analysis of objective risk would fail to discriminate sufficiently between municipalities to permit priorities to be set for cleaning up sites, or for siting new facilities; 2) that an analysis of net risk would begin to provide such discrimination; and 3) that the inclusion of response capability factors would alter the risk situation significantly. All three hypotheses are borne out.