In 2002, the Environmental Protection Agency (EPA) passed The Small Business Liability Relief and Brownfields Revitalization Act (“Brownfields Amendments). This legislation amended the CERCLA (Superfund) regulation and provides statutory protection to bona fide prospective purchasers, contiguous landowners and innocent landowners.

The legislation provides new Federal (Superfund) exemptions to liability for two very important categories of entities.

The first exemption to liability is the Prospective Purchaser exemption. To qualify for this, the buyer must not have any other liability for pollution at the Property. To qualify the owner must not impede the response action or natural resource restoration. The pollution must have occurred before purchase, the person made “all appropriate inquiry” into the previous ownership and uses, the person cooperated with cleanup, institutional controls, and the personis not liable or affiliated with any person that is potentially liable.

The second exemption is for Contiguous Landowners: owners of land that is “contiguous to or otherwise similarly situated with respect to” land not owned by that person and that is or may be contaminated by pollution that has migrated from the contiguous property. The contiguous land owner must document that they did not cause or contribute to the pollution, is not potentially liable or affiliated with any other person that is potentially liable, took reasonable steps to stop or prevent pollution and fully cooperates with and gives access to those authorized to conduct cleanups.

How does this help us?

  1. the legislation basically precludes federal enforcement against property that has been cleaned up in accordance with state law
  2. the EPA will provide “comfort letters” that name the contiguous landowners or prospective purchasers
  3. the legislation specifically refers to the Phase 1 Environmental Site Assessment ASTM standard for conducting appropriate inquiry.
  4. The Brownfields Amendments provide significant legal protection for owners, buyers and lenders.

ERAS has recently been involved with an EPA site where a comfort letter was issued that allowed SBA financing.

ERAS can discuss these issues and a variety of agency comfort letters with you. ERAS has almost 15 years experience in conducting Phase 1 Environmental Site Assessments for appropriate inquiry.

ERAS also has extensive experience in conducting Phase 2 remediation projects at Brownfield sites.