Brownfield
Liability
Federal Liability Protections for Private Developers
The Small Business Liability Relief and Revitalization Act (the
Brownfields Amendments) clarifies CERCLA liability provisions
for certain landowners and potential property owners. The Brownfields
Amendments provide liability protections for certain property
owners, if the property owners comply with specific provisions
outlined in the statute, including conducting all appropriate
inquiries into present and past uses of the property and the potential
presence of environmental contamination on the property. The Brownfields
Amendments amend Section 101(35)(B) of CERCLA and require EPA
to promulgate regulations that establish federal standards and
practices for conducting all appropriate inquiries.
The all appropriate inquiries standards and practices are relevant
to:
- The innocent landowner defense to CERCLA liability (§101
(35));
- The contiguous property exemption to CERCLA liability (§107
(q));
- The bona fide prospective purchaser exemption to CERCLA liability
(§107 (r)(1) and (§101 (40));
- The brownfields site characterization and assessment grant
programs (§104 (k)(2)).
The All Appropriate Inquiry may provide the information necessary
for an informed business decision. All Appropriate Inquiry is
part of the process that an innocent landowner, contiguous landowner,
or bona fide prospective purchaser must follow to secure an exemption
or defense to Comprehensive Environmental Response, Compensation
and Liability Act (CERCLA), also known as “Superfund,”
liability. All Appropriate Inquiries must be conducted or updated
within one year prior to acquiring ownership of a property. Additional
information and an explanation of the federal liability protections
are found at https://www.epa.gov/brownfields/aai/index.htm.
State Liability Protections for Private Developers
It is important that a private developer initiate Diligent Inquiry
prior to acquiring the property to begin the process to secure
state liability protections. Once remediation activities are complete,
the developer has a defense against third party damage claims,
will not be considered a Responsible Party and a Covenant Not
to Sue applies to the cleanup activities that are completed in
accordance with state requirements. These protections are found
at N.J.S.A. 58:10-23.11g(d)(4).
Federal Liability Protections for Governmental Entities
CERCLA also contains liability exemptions, affirmative defenses,
and protections which may apply to a local government when it:
- Acquires contaminated property involuntarily by virtue if
its function as a sovereign, CERCLA § 101(20)(D)
- Qualifies for a third party defense or innocent landowner
liability protection, CERCLA §§ 107(b)(3), 101(35)(A)
- Qualifies as a bona fide prospective purchaser (BFPP) when
it acquires the contaminated property, CERCLA §§ 101(40),
107(r)(1)
- Is conducting or has completed a cleanup of a contaminated
property in compliance with a state cleanup program, CERCLA
§ 128(b).
More information on local
and state CERCLA liability protections
State Liability Protections for Governmental Entities
A federal, state, county or municipal government entity can
determine whether it is responsible for the contamination by reviewing
the Spill Compensation and Control Act at N.J.S.A. 58:10-23.11g.d(4).
The Spill Act exempts government entities from joint and several
liability where the governmental entity involuntarily acquires
title to a site by virtue of its function as sovereign, or where
the governmental entity acquires the property by any means for
the purpose of promoting the redevelopment of that property.
The government entity is not liable for any discharge that occurred
prior to ownership of the site that the government entity acquired
involuntarily, such as in cases of:
- bankruptcy
- tax delinquency
- abandonment
- escheat
- eminent domain
- condemnation
There is no liability protection to the government entity if
it caused or contributed to the discharge of a hazardous substance,
or if it acquired ownership of the property by condemnation or
eminent domain and that property is being remediated in a timely
manner by another party.
Funding
Opportunities |
|