New EPA Guidance for Brownfields - Real Estate Recovery Capital
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New EPA Guidance for Brownfields

As a quick refresher, the 2002 Brownfields Amendments to CERCLA offered liability protection options for buyers of properties with actual or perceived environmental contamination to encourage more redevelopment of Brownfields.  Buyers can establish Bona Fide Prospective Purchaser Protection for themselves and be exempt from most liabilities for previous owners’ contamination by demonstrating they have no connection to the liable party for the contamination and by conforming with “All Appropriate Inquiries” prior to purchase and certain continuing obligations after purchase.

 

On July 29, 2019, the EPA released a new guidance that supersedes the previous guidance from 2002 and provides additional clarification and examples of how the EPA encourages agencies to interpret individual scenarios surrounding landowner liability protection.  We will share two key takeaways but encourage you to read the full article to understand all the changes in the new guidance and to consult with legal counsel for your specific situation, as the information contained in this post is presented for informational purposes only and is not intended to be legal advice.

 

Takeaway 1:
The EPA is defining implementation of institutional controls after closing on a property as part of the ongoing requirement to cooperate with the regulatory agencies. For example, if a previous owner did not act on a previously suggested or required institutional control, the new landowner may be required to implement it in order to maintain their protected status as a Bona Fide Prospective Purchaser (BFPP), Contiguous Property Owner, or Innocent Landowner.

 

Takeaway 2:
The EPA now distinguishes between initial and secondary disposals.
– Initial disposals would be introducing new contamination to the site, which violates one of the ongoing continuing obligations required for maintenance of landowner liability protection.
– Secondary disposals would be reasonable actions that may unintentionally disturb or expose contamination, but that should not impact the BFPP protection if appropriate action is taken to contain and remediate.  Grading soil on a remediated Brownfield to redevelop for an approved use would likely be considered a reasonable action; an unprotected action would be disturbing a soil cap.

 

The EPA’s 30+ pages of the new guidance can be found here.

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