DEC Proposes Amended Guidance on Brownfield Cleanup Program


By: Heewon Kim

DEC recently released a draft revision of its Brownfield Cleanup Program (“BCP”) guidance document, DER-32/Brownfield Cleanup Program Applications and Agreements. This document provides guidance on the BCP application process, as well as the content of and process for executing, amending and terminating a Brownfield Cleanup Agreement (“BCA”). The revisions are intended to reflect the 2015 amendments to the BCP, New York State’s statutory voluntary cleanup program offering tax credit incentives for remediation and redevelopment of contaminated properties, which went into effect in August 2016.

The draft guidance fails to answer some important questions raised by the 2015 amendments. One of the threshold changes in the 2015 legislation was the revision of the definition of “brownfield site” to require a demonstration that contamination is present at the site at “levels exceeding the soil cleanup objectives or other health-based or environmental standards, criteria or guidance… that are applicable based on the reasonably anticipated use of the property”. (ECL § 27-1405(2)). Although the draft guidance states that information in the application “must be sufficient to establish that the site conforms to the definition of a brownfield and that the site requires remediation”, it offers no further guidance on how such a determination will be made. This omission is notable because, in practice, DEC has construed the 2015 amendments as requiring applicants to make such a demonstration with on-site data of contamination in excess of applicable cleanup standards.

In addition, the draft guidance does not provide criteria for determining whether an applicant is a Volunteer or a Participant–specifically, how DEC interprets the requirement that a Volunteer has exercised “appropriate care with respect to contamination found at the facility”. (See 6 NYCRR § 375-3.2(c)(2).)  A Participant has additional obligations to address off-site contamination and pay state oversight costs for its site. The BCP statute and regulations allow broad discretion to DEC on this point, and thus the absence of clarification as to how DEC determines who can be a Volunteer or a Participant is noteworthy.  The draft guidance does state that, if there are multiple applicants executing a BCA and one is a Participant, the BCA will not be drafted to distinguish between the roles and responsibilities of the individual Applicants and that the COC for the site will not be issued until the off-site work has been completed.

Notably, the draft guidance addresses the potential that modifications to a BCA might move a site from a prior version of the Program into the 2015 BCP (referred to by DEC as “Generation 3”), which could have a significant impact on an Applicant’s eligibility for BCP tax credits. The draft guidance states that “depending on whether the application to amend is a major or minor amendment will determine which generation of the BCP’s requirements should apply to the site” (id. at 9) but it offers little insight into how DEC will make such a determination, noting that such determinations are made “on a case-by-case basis, taking into consideration the public interest and the factors described in this guidance” (id. at 10).  Those “factors” are not clearly set forth in the draft and only vague examples of major modifications are provided.

Of related importance, sites that entered the original BCP (i.e., prior to July 1, 2008) that do not receive a Certificate of Completion (“COC”) by December 31, 2017 will automatically be subject to the “Generation 3” BCP and corresponding regulations. As there are over 110 sites intending to obtain a 2017 COC – more than twice the number that received a COC in 2016 – it is crucial to submit closure documents early, ahead of the official milestone dates. For example, while the milestone date for submitting a Site Management Plan (“SMP”) is August 1, 2017, at a recent DEC event about the BCP program, DEC requested those who need to submit SMPs for site closure to submit drafts ASAP.

DEC is accepting comments on the draft revised guidance through Friday, May 19, 2017.   If you have questions about the draft guidance or the BCP itself, please contact Michael Bogin, Jenn Coghlan or Christine Leas.