Developing Distressed Property: Desirability and Viability

Zarwin, Baum, DeVito, Kaplan, Schaer, Toddy P.C.
Paul M. Schmidt

July 25, 2017

Location, Location, Location. This remains one of the critical aspects of real estate development. The other is that “it’s not about the money, it’s about the money.” So, while the redevelopment of Brownfields makes people feel good, at the end of the day, a Brownfield site has to be in the right location for a redeveloper or buyer, and has to make economic sense. Currently, a number of trends in real estate desirability are making Brownfield sites the perfect location for redevelopment and reuse. At the same time, as programs concerning cleanup, funding and risk management have become more favorable, the return on investment, or economic viability, of properties has also increased. This article will examine some of the key aspects of desirability and viability that are working together to make Brownfield redevelopment increasingly attractive in today’s real estate market.

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Coming Soon To A Massachusetts Facility Near You: More Citizen Enforcement?

Foley Hoag LLP
Seth D. Jaffe

August 9, 2017

Earlier this week, the Massachusetts Executive Office of Environmental Affairs went live with two new web sites intended to increase the public availability of information concerning regulated entities in Massachusetts.  The first, ePLACE, will provide information about on-line permit applications.  However, since MassDEP began accepting on-line applications on May 5, 2017, ePLACE is going to be of much more interest in the future than it is today.  As of now, there is not much there.

The more interesting site is the Data Portal, which lists permits, inspections, and enforcement actions with respect to any facility in Massachusetts.  The site does not provide many specifics, but it does list every existing permit and enforcement action against each facility in Massachusetts.

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NJDEP Offers Guidance On Remedial Action Report Submittal Deadlines

Riker Danzig Scherer Hyland & Perretti LLP
Laurie J. Sands

August 1, 2017

Reprinted with permission.  © 2017 Riker Danzig Scherer Hyland & Perretti LLP.

Recently, the New Jersey Department of Environmental Protection (“NJDEP”) issued guidance regarding the regulatory and mandatory timeframes for the submission of a remedial action report pursuant to the Technical Requirements for Site Remediation and the Administrative Requirements of the Remediation of Contaminated Sites. The guidance is meant to assist persons responsible for conducting the remediation (“PRCR”) in determining when remedial action reports are due, when to request an extension of the regulatory and mandatory deadlines for submission of such reports and in what situations the NJDEP will consider such an extension.

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EPA Administrator Takes Aim at Aging Superfund Sites

Phillips Lytle LLP
Myriah V. Jaworski

July 27, 2017

Despite condoning a 34 percent cut to his agency’s funding for fiscal year 2018, U.S. EPA Administrator Scott Pruitt this week announced a seemingly ambitious plan to expedite the federal Superfund process to address the roughly 1,300 sites listed on the National Priorities List. Characterizing these sites as “languishing,” Pruitt promised that the “days of talking are over,” and that EPA would take immediate action to accelerate cleanup efforts nationwide.

Specifically, on July 25, Pruitt and the U.S. EPA Superfund Task Force released their “Recommendations to Streamline and Improve the Superfund Program.” The Report detailed 42 recommendations organized into five goals, which Pruitt believes will have the effect of expediting the remedial process and promoting reuse of contaminated sites. The high-level goals identified are: (1) expediting cleanup and remediation; (2) re-invigorating responsible party cleanup and reuse; (3) encouraging private investment; (4) promoting redevelopment and community revitalization; and (5) encouraging partners and stakeholders.

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Public Comment Opens on WOTUS Rulemaking

 

Vinson & Elkins LLP
Andrew R. Stewart and Taylor Holcomb

July 31, 2017

On July 27, the Environmental Protection Agency and the Corps of Engineers jointly proposed to rescind the “waters of the United States” definition in the Code of Federal Regulations and to apply the definition in place both before to the 2015 rulemaking adding the definition and after the Sixth Circuit’s late 2015 stay of the rule. This rulemaking is drawing substantial interest because the definition outlines much of these agencies’ jurisdiction. Public comments are due on August 28, 2017.

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Leaking Underground Storage Tank Trust Fund: Petroleum Marketers Association of America (and Other Groups) June 16th Letter to House Committee on Appropriations Addressing Funding

Mitchell Williams Selig Gates & Woodyard PLLC
Walter Wright

July 5, 2017

The Petroleum Marketers Association of America along with the National Association of Convenience Stores, National Association of Truck Stop Operators, and Society of Independent Gasoline Marketers of America (collectively “PMAA”) sent a June 16th letter to the Chairman and Ranking Member of the United States House of Representatives Committee on Appropriations addressing the federal Leaking Underground Storage Tank Trust Fund (“LUST Fund”).

The focus of the joint letter was opposition to the President’s FY 2018 budget request of $47 million for the LUST Fund arguing the amount is inadequate.

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Department of Justice Ends Controversial Third-Party Settlement Practice—What Will It Mean for Supplemental Environmental Projects?

Taft Stettinius & Hollister LLP
Will Gardner and Kimberly S. Lewis

July 6, 2017

On June 7, U.S. Attorney General Jeff Sessions issued a memorandum prohibiting the Department of Justice (“DOJ”) and the 94 U.S. attorney’s offices from entering into settlement agreements that provide for payment to a nongovernmental, third party that was not directly harmed by the conduct at issue. Settlement payments to third-party, non-governmental organizations (“NGO”) became commonplace during the Obama administration, with millions of dollars in settlement payments going to NGOs.

Third-party payments were used in a number of the Obama administration’s most high-profile settlements, including, the BP plea agreement regarding Deep Water Horizon ($350 million to the National Academy of Sciences), the mortgage lending settlements with JP Morgan, Citi and Bank of America (millions of dollars to NeighborWorks America and others), and the settlement with Volkswagen regarding vehicle emission testing ($2 billion in settlement payments for investment in zero-emission vehicle infrastructure, such as electric charging stations, to benefit both the public and various NGOs).

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NYSDEC Set to Propose Revisions to the Brownfield Cleanup Program: A Preview of Changes

Phillips Lytle LLP
Laura L. Mona

June 30, 2017

A preview of at least some of the proposed revisions to the New York State Department of Environmental Conservation’s (“NYSDEC”) regulations for the Brownfield Cleanup Program (“BCP”) (6 N.Y.C.R.R. Part 375) was revealed in May 2017, with official release anticipated later this year. Key changes are expected to include new program and tax credit eligibility requirements as well as clarifications to aspects of program implementation, all in an effort to provide more consistency across remedial programs and to generally update the BCP, now over a decade old. To what extent the revisions will provide clarity to BCP applicants remains to be seen once the changes are officially published. However, the preview reveals there is likely to be more questions and concerns than answers.

New eligibility requirements will likely include a formalized obligation for BCP applicants to conduct a search for potentially responsible parties (“PRPs”) before the application will be deemed complete. The scope and extent of PRP searches are expected to be outlined in the proposed regulations and will likely warrant close review as PRP searches can be time-consuming and costly.

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CERCLA Due Diligence Requirements Revised to Reflect Updated Phase I Standard for Forested and Rural Land

Spencer Fane LLP
Paul Jacobson

July 11, 2017

Purchasers of rural and forested land need to be aware of a recent change in EPA’s environmental due diligence rules. On June 20, 2017, EPA published a Direct Final Rule in the Federal Register, amending the All Appropriate Inquiries (AAI) Rule, 40 CFR Part 312, to reflect 2016 updates to ASTM E2247, a standard for Phase I investigations on rural and forested land. The AAI Rule sets forth requisite practices for satisfying CERCLA § 101(35)(B) so as to obtain CERCLA liability relief, i.e. the innocent landowner defense, bona fide prospective purchaser liability protection, and contiguous property owner liability protection. The AAI requirements also apply when conducting site characterizations and assessments with the use of a Brownfields grant, under CERCLA § 104(k)(2)(B).

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The Environmental Regulatory Reforms Manufacturers Want Most

Husch Blackwell LLP
Charles E. Merrill

June 14, 2017

U.S. manufacturers and their trade associations have submitted comments to the U. S. Department of Commerce (DOC) on changes they would like to see in environmental regulations. President Trump’s Memorandum of January 24, 2017, “Streamlining Permitting and Reducing Regulatory Burdens for Domestic Manufacturing”[1] directed the DOC to conduct outreach concerning the impact of Federal regulations on domestic manufacturing. This article reviews manufacturers’ responses to DOC on environmental issues.

The DOC sought input on:

The impact of Federal permitting requirements on the construction, expansion, or operation of domestic manufacturing facilities, and possible Federal actions to streamline permitting. Regulations that adversely impact domestic manufacturers, including compliance burdens for facility construction, expansion, or operation.[2]

DOC asked about the number of permits required; the time required to obtain permits; duplication or overlapping of permits; the most onerous features of permits; and suggestions for improvement of the permitting process. DOC received over 170 comments by its March 31, 2017 deadline on a wide range of federal regulations. The comments are available at: https://www.regulations.gov/docketBrowser?rpp=25&so=DESC&sb=commentDueDate&po=0&dct=P S&D=DOC-2017-0001.

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