Publications | October 20, 2017

Brownfields Law Alert – Superfund Task Force Recommendations and Low-Threat Groundwater Policy

Superfund Task Force Recommendations Encourage Private Investment in Site Cleanup

Brownfield developers have been speculating for the past year about how Trump administration policies will affect the regulatory climate for Brownfield projects. The forecast appears sunny based on EPA Administrator Scott Pruitt’s recently released Superfund Task Force Recommendations and remarks from Patrick Traylor, Deputy Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance at this week’s CBA Environmental Law program.

Administrator Pruitt convened the task force in May of this year. Front and center among the Administrator’s five goals for the task force were recommendations to encourage private investment in site cleanups.

The recommendations were released on July 25th and reflect a material shift from EPA’s past position on the use of the principal liability management tools available to site purchasers and redevelopers, comfort letters, and settlement agreements. EPA historically has issued comfort/status letters to share information with interested parties about the status of properties that may present cleanup and liability concerns under the Comprehensive Environmental Response, Compensation and Liability Act and liability protections that may be available. EPA also has offered prospective purchaser agreements, which include a covenant not to sue and contribution protection to parties willing to perform certain cleanup or provide other consideration, but are not responsible for contamination. However, since 2002, when Congress passed the Brownfield Amendments that established statutory liability protections for certain landowners who are not responsible for contamination, EPA has viewed these protections as self-implementing and has offered assurances to facilitate private redevelopment transactions sparingly and with limited refinements to its principal tools.

The new recommendations indicate a commitment from EPA to support and enhance these liability management tools to incentivize private redevelopment of contaminated property and in EPA’s words, to “consider mitigating its retained rights” to that end. Recommendations and specific actions the Task Force outlined of particular interest include:

  • Making special account funds from PRP settlements available to bona fide prospective purchasers that perform cleanup work and prioritizing these funds for sites with redevelopment potential
  • Expanding the use of prospective purchaser agreements, windfall lien settlement agreements, and BFPP agreements to specifically limit purchaser liability
  • Updating the model forms of these agreements to incentivize settlement and better insulate “good faith purchasers from unexpected liability
  • Developing new tools to address liability concerns of parties who acquire or operate properties, such as model reuse assessment agreements, prospective operator agreements and prospective easement agreement
  • Providing greater comfort in comfort letters, including standard language that provides for certainty in securing funding from lenders for redevelopment of Superfund sites
  • Streamlining and expediting the regional/headquarter/DOJ approval process for site-specific letters and agreements

The timelines for taking specific recommended actions, if met, will mean EPA is beginning to implement these initiatives now and in early 2018. Mr. Traylor confirmed that EPA’s Office of Enforcement views the recommendations as encouraging greater efforts by his office to seek PRP funding for cleanup and to provide incentives for non-PRP cleanup. EPA Region 8 has not yet published any official statements.

The Superfund Task Force Recommendations are available on EPA’s website. Please contact Polly Jessen with questions regarding how the recommendations may affect your property acquisition or redevelopment project.

CDPHE’S Low-Threat Groundwater Policy

The Colorado Department of Public Health and Environment (CDPHE) Hazardous Materials and Waste Management Division worked hard to come up with a way for sites with low-threat groundwater contamination to exit the regulatory system. CDPHE would like to get the word out and let site owners (and their attorneys and consultants) know how to use this policy to get sites off the regulatory “books.” Please also join us on October 25th from noon to 1:00 p.m. for a CLE presentation by First Assistant Attorney General David Kreutzer and Assistant Attorney General Kendall Griffin from the Office of the Attorney General. They will discuss CDPHE’s Policy for Conditional Closure of Low-Threat Sites with Residual Groundwater Contamination. Registration is free, but space is limited. Please RSVP as soon as possible to Ossie Richards.

Kaplan Kirsch & Rockwell publishes Brownfields Law Alerts to announce late-breaking developments in legislation, regulation, and policy for our clients and colleagues. Nothing in the Alerts is intended as legal advice, and readers are reminded to contact legal counsel for legal advice on the matters that appear in our Alerts.