2009 CPEO Brownfields List Archive

From: Peter Strauss <petestrauss1@comcast.net>
Date: Sun, 22 Nov 2009 22:45:02 -0800 (PST)
Reply: cpeo-brownfields
Subject: Re: [CPEO-BIF] Reporting Phase 1 and Phase 2 Environmental Site Assessments
 
Larry, or anyone else who knows:
There was, as I recall , a law passed (ECRA?) in NJ that required an industrial site to take affirmative action on sites in which the owner was transferring property, similar to what we have been discussing.  Does anyone have experience with this law and how it has worked?  Did it meet an appropriate standard of informing the public; did it require remediation of contamination before the property could be transferred?  Most importantly, could this serve as a model for a policy that would require due care  (or pay the consequences)? Is the law still in effect?

Peter
On Nov 22, 2009, at 7:17 PM, Schnapf, Lawrence wrote:

My reference to new brownfield sites being created is the sheer number of contaminated sites being shutdown, or owned sites being abandoned to insolvent entities and  leased sites rejected as part of bankruptcy procedures in the past two years.

Again, my  concern is the  sites that do not have impending or foreseeable transactions so that contamination may continue to migrate, as well as sites that were redeveloped in the past as part of a self-directed cleanup.

As lender's counsel, I continually was confronted with former manufacturing, gas station and dry cleaner sites that were redeveloped and remediated without any regulatory oversight b/c of concerns about construction delays and overruns.

They would seek private financing to take out construction loans and could not provide any regulatory signoffs. often times, I had to force borrower to take additional sampling and then report results to the state for further remediation. However, the lenders often looked the other way when they would be securitizing the loans since they would be selling the loans to investors elsewhere in the world and getting hugh fees in addition to getting loans off their books. Created quite the moral hazard.

I've seen this all over the country in big states and small. The developers and owners rather risk the possibility of  regulators discovering the unsupervised cleanup than risk their construction schedules. .  The attitude is that the overworked regulators will focus on their unremediated sites and are to  unlikely impose any penalties for a  site that as already been redeveloped and occupied.

Of course, this only happens for projects that are privately-financed and  do not receive brownfield funding- which is the vast majority of the time

L
Larry Schnapf
Schulte Roth & Zabel
919 Third Avenue
New York, NY 10022
212-756-2205 (p)
212-593-5955 (f)

----- Original Message -----
From: brownfields-bounces@lists.cpeo.org <brownfields-bounces@lists.cpeo.org>
To: Brownfields Internet Forum <brownfields@lists.cpeo.org>
Sent: Sun Nov 22 15:15:56 2009
Subject: Re: [CPEO-BIF] Reporting Phase 1 and Phase 2 Environmental Site Assessments

Larry, could you please elaborate on the last sentence *Indeed, more brownfield
sites were created in 2009 than were
cleaned up!*? Are you referring to migration of soil and groundwater
contamination to adjacent properties either because cleanup is not happening or
because of incomplete/self-directed cleanups?

Also, I would also appreciate if anyone direct me to reports documenting these
various conditions under which legacy pollution is not required to be reported
to the relevant agencies during redevelopment/sale of properties (when I expect
these conditions to be made public).

Deb.

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