The federal government should provide incentives to state and local governments to plan for growth and redevelopment of infill sites in cities and inner suburbs. One means to achieve this objective is to provide builders and developers protection from the current threat of federal liability and enforcement action to those innocent landowners who redevelop brownfields under a state voluntary clean-up program.
Background
On January 11, 2002 President Bush signed the Small Business Liability Relief and Brownfields Revitalization Act (Public Law 107-118.) The law was intended to provide developers and builders incentives to redevelop contaminated properties. The law provides limited federal enforcement and liability protections under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) (commonly referred to as “Superfund”) for developers who successfully complete a site clean-up using an existing state clean-up program. Under the new law, states, not the federal government, will determine clean-up standards at a site, as well as determine when clean-up standards have successfully been reached. Equally important for developers and builders, the law provides developers, builders, local governments, and other landowners the needed clarification (in the form of an EPA regulation called “all appropriate inquiry” and EPA enforcement guidance clarifying what steps constitute “due care”) concerning what specific steps a landowner must take both prior and after acquiring a contaminated property to ensure he/she will qualify for liability protections extended under the law. NAHB members participated in this EPA negotiated rulemaking process that resulted in EPA’s final rule on “all appropriate inquiry” that went into effect on November 1, 2006.
While NAHB supported the federal brownfields law, it lacks liability and enforcement exemptions for all types of pollutants. Specifically, the brownfields law fails to provide federal enforcement and liability protections to developers or builders who successfully remediate petroleum-contaminated sites. This gap in federal enforcement and liability coverage exists despite the fact that approximately half of the nation’s brownfield sites are contaminated with petroleum, according to EPA. However, due to a statutory loophole that excludes petroleum from being covered under CERCLA, half the nation’s brownfield sites are ineligible for the liability and enforcement protections extended under the new law. Instead, petroleum-contaminated sites are covered under a totally different federal environmental statute, the Resource Conservation and Recovery Act (RCRA), which has similar enforcement and liability regimes as CERCLA, but lacks the protections to innocent landowners and developers.
Solutions
Support legislation or regulatory guidance to include enforcement and liability protections under the Resource Conservation and Recovery Act (RCRA) for developers and builders who qualify as bona fide prospective purchasers under the federal brownfields law who remediate petroleum–contaminated sites under existing state clean-up programs.
Support state programs that:
Address all brownfield sites, including petroleum-contaminated sites.
Permit the use of affordable clean-up standards that are proportional to the level of pollution and the end use of the property.
Recognize a balance between the cost of clean-up and the value of the property.
Offer liability protections for property owners and occupiers that did not cause the contamination (so-called innocent landowners or prospective purchasers).
Support economic incentives at both the state and federal levels, such as federal tax credits, grants, and low interest “revolving loans” to encourage brownfields redevelopment and defray the costs of environmental remediation.
