For nearly 30 years, the Environmental Protection Agency (EPA) has run a program to remediate and clean up brownfields nationwide. A brownfield is a property that was previously in use and abandoned, potentially containing toxins and pollutants.
The program aims to encourage the government to work together with private entities to clean up such properties so they no longer pose a danger to others, potentially allowing for further development.
States and private entities involved in this process should consult an environmental compliance lawyer to learn more.
There are nearly half a million of these properties throughout the country, and all of them are unused and potentially dangerous.
Brownfields may include:
- Gas stations
- Dry cleaning facilities
- Abandoned factories
- Chemical dumps
- Landfills
Why The Government Must Act to Remediate Brownfields
There are numerous reasons why the government will want to clean up an abandoned industrial site. The chemicals and other hazards at these sites can pose a health danger for those in the surrounding areas.
People who live near abandoned sites may even have a legal cause of action against either the government or the entity that caused the pollution. Their life spans may decrease, and a chronically polluted site can result in an overall drop in economic productivity.
Industrial sites may need to be remediated before any further development can take place. If the government can order the site’s cleanup, the land may be sold for other uses, resulting in economic development. Moreover, polluted sites can hurt the surrounding property, depressing values and keeping other developments from occurring in the vicinity.
Brownfield vs. Superfund Sites
There is a difference between a brownfield and a Superfund site. The latter is a heavily polluted area that would require the federal government to clean up the site.
The government may seek financial contributions from the party responsible for the pollution in the first place, and they may go to court to do so. Cleanup costs may reach hundreds of millions of dollars, and the federal government may enter into a settlement agreement with the polluter to defray the costs.
A brownfield is conceivably not as polluted as a Superfund site. Here, a developer can remediate the property on their own, although they may need financial assistance to do so. The government will still have to oversee the project to ensure proper cleanup so the property can be reused for other purposes.
Designating an Area as a Brownfield or a Superfund Site
If the federal government decides that the property qualifies as a Superfund site under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), the implications entirely differ.
First, the entire process will have much greater legal involvement because a party is potentially liable for cleanup costs. Second, the federal government (as opposed to the state) will lead the cleanup process.
The EPA assesses the site and determines whether it would qualify for the Superfund or brownfield program. It uses a hazard-based scoring system to assign points for things like the type and quantity of hazardous substances present, the proximity to populations, and the potential for contamination migration.
If the area scores above a certain amount on the scale, the EPA will give it a Superfund designation.
If CERCLA liability applies, there is an additional challenge in determining who the responsible parties are and how much they must pay toward the cleanup. The party can face strict liability for the entire cost of the cleanup. Joint and several liability with other parties may apply.
For example, numerous companies might have potentially polluted a certain site, and they will share the liability. The legal question is how the parties will divide the costs of cleanup.
Finally, a company can bear partial responsibility for the conditions at the site and might need to pay part of the cleanup costs. The company may then need to pay a disproportionate amount of the cleanup costs.
Subsequent Property Owners Could Be Liable
If someone purchases a polluted property, they risk facing additional costs in the future. An owner may need to pay for cleanup costs if the EPA decides to designate the property as a Superfund site. Therefore, the property owner needs to know about the exact state of the property when they buy it and who may have polluted it in the past.
If the property qualifies as a brownfield, some protections can apply to the property owner that keep them from paying damages under CERCLA.
In that sense, the brownfield program seeks to encourage private parties to purchase potentially polluted land and clean it up with help, funding, and guidance from the state. Should the government designate the property as a Superfund site, they may not have to pay anything in the future.
Any entities purchasing such property should have guidance from an environmental compliance attorney.
In addition, protections from CERCLA liability apply when the state is involved in the acquisition or transfer of a contaminated site.
Congress passed the BUILD Act in 2018 for exactly this purpose. The law applies beyond just properties acquired involuntarily, and it added a new category of acquisitions that can promote and facilitate state-guided cleanups of these properties.
Funding and Financial Obstacles to Redevelopment
Remediation can involve very high cleanup costs. The extent of the pollution on the property can be even far greater than the developer or purchaser anticipated when they decided to begin the cleanup efforts.
Even though the EPA may have already scoured the property, the developer never quite knows exactly what is lurking beneath the surface until they try to begin the actual cleanup.
There is a very real possibility of a significant cost overrun during the cleanup process. The question is then whether the developer is on the hook for that entire amount, since they have accepted funding from the state to remediate the property. Developers may hesitate to take the risk, and it can defeat the purpose of the entire cleanup program.
There are certain protections for developers. For example, a developer can purchase insurance to cover any increased costs from additional or more extensive pollutants or significant delays to the project.
Then, the developer may need to deal with an insurance company when they file a claim to pay for the additional costs. The developer can apply for additional grants from the state or federal government to pay for the increased costs, but these are subject to funding being available and approval from the government.
The States’ Role in the Cleanup of Brownfields
Much of the heavy lifting for the cleanup of brownfields is done at the state level. The state environmental agency works with developers and others to provide guidance and direction (and in some cases, funding) to clean up brownfields.
The state often provides oversight to developers who want to conduct a cleanup to further develop the property. It may even provide other financial incentives, such as low-interest loans, to those who want to remediate the property.
Challenges for the State in the Brownfields Cleanup Process
When the state oversees the project, it must ensure parties adhere to both state and federal guidelines. It also needs to closely monitor the developer to ensure they follow proper remediation standards and that the project site is properly remediated before other development can occur.
The state must also coordinate among the various stakeholders involved in the project. Adjoining landowners may want a say in what happens at a neighboring site. The developer or the state may need to give these landowners notice of what is occurring, and they may need to incorporate their feedback into the process, whether it is informal or through a notice-and-comment process.
In addition, local governments can also influence the overall project through land use restrictions that may apply to the site. The developer may want to use the property in ways local zoning does not allow.
Alternatively, the local government may wish to restrict usage in line with existing regulations, impacting whether a developer wants to take on the project.
States and other entities involved in the process need help from an environmental attorney to learn more about the challenges involved in site cleanup and remediation. An environmental attorney in San Diego can review federal regulations and provide practical compliance advice to those involved in the process.