A NEW ERA OF BROWNFIELDS REGULATION:
An In-Depth View of New York City’s Municipal Approach to Brownfields Regulation*
A Report of the New York County Lawyers’ Association Environmental Law Committee
July 22, 2009
On May 11, 2009, Mayor Bloomberg signed into law the New York City Brownfield and Community Revitalization Act (“Act”). The Act allows for the codification of the Mayor’s Office of Environmental Remediation (“OER”) and grants OER the authority to develop and operate the nation’s first municipality- directed local brownfield cleanup program. As the first fully comprehensive local program to address brownfield redevelopment in the United States, the Act may serve as a template for the development of similar programs in municipalities nationwide. Thus, the Act marks the beginning of a new era of brownfields regulations, one that introduces the municipality as a new regulatory entity.
The New York State Brownfield Cleanup Program (“BCP”) defines a “brownfield site” as “any real property, the redevelopment or reuse of which may be complicated by the presence or potential presence of a contaminant.” Brownfield sites are typically underutilized properties that remain vacant due to the difficulties and expenses associated with site remediation. Despite these obstacles, brownfields redevelopment is important because it can prevent urban sprawl and reduce threats to public health and the environment. In addition, brownfields redevelopment can create economic benefits such as urban revitalization, economic stimulation, job creation and revenue generation.
To promote brownfields redevelopment, the New York State Department of Environmental Conservation (“DEC”) enacted the BCP in 2003. The BCP is a voluntary program in which an applicant commits to undertaking remedial action at a contaminated site and agrees to State oversight of the cleanup. In exchange, the State provides the applicant with tax credits and a liability release. The DEC, however, does not accept all brownfield sites into the BCP. For example, many sites with low to moderate contamination are denied admittance into the program. In particular, sites contaminated with historic fill (many of which are located in New York City) are completely excluded from the BCP.
PlaNYC 2030 estimates that there may be as many as 7,600 acres of contaminated land in New York City. To address these sites and fill in the gap created by the exclusion of sites from the BCP, New York City established OER in June 2008. From its inception, OER has worked with City agencies, the New York City Council and environmental public interest organizations to draft a local law that will grant OER the authority to establish and implement a local brownfield cleanup program. On April 22, 2009, the New York City Council unanimously approved the Act; on May 11, 2009, Mayor Bloomberg signed the Act into law.
The New York City Brownfield and Community Revitalization Act:
The passage of the Act allows for the codification of OER by amending the New York City Charter (“Charter”) to include a new Section 1404 in Chapter 57. The Act also amends Section 15 of the Charter by adding a new Section (e). Section (e) establishes that there will be a Director of OER, defines the Director’s responsibilities and states that the Director will be appointed by the Mayor. Additionally, the Act amends Title 24 of the New York City Administrative Code (“Code”) to include a new Chapter 9, entitled the “New York City Local Brownfield Cleanup Law.” Chapter 9 describes the eligibility criteria for entrance into the New York City Local Brownfield Cleanup Program (“LBCP”), outlines the rules and regulations needed for the LBCP to function effectively and enumerates the benefits of participating in the LBCP.
Amendments to the New York City Charter:
Section 15(e) of the Charter states that there will be a Director of OER and confers a number of responsibilities on the Director. The Director, in consultation with other city agencies and officials, will develop and oversee City policies pertaining to brownfields redevelopment and ensure that such policies are protective of the public health and the environment. In collaboration with the New York City Office of Long-Term Planning and Sustainability, the Director will design programs that promote sustainable growth, particularly in brownfield opportunity areas. The Director is also responsible for the development of the LBCP and the administration of the program once it is fully operational. Furthermore, the Director will establish fees for programs administered by OER and will promulgate rules that are necessary to implement the LBCP.
The Act seeks to encourage community participation by amending the Charter to require that the Director promote community involvement, offer technical support and educate community groups, developers and property owners on the stages of brownfield redevelopment for sites located in their communities. The Act also requires that the Director support the efforts of community groups, developers and property owners when trying to utilize Federal, State and private funding throughout the brownfield redevelopment process. Finally, the Director may apply for and administer funds to support economic redevelopment of brownfield sites and can advise City agencies on any of their development projects involving brownfields.
The Charter amendments also transfer the authority to administer the New York City Zoning Resolution’s (E) Designation Program to OER. As such, OER will act as successor to the New York City Department of Environmental Protection (“DEP”) for the purposes of enforcing the (E) Designation program. Moreover, the responsibility of ensuring compliance with hazardous waste restrictive covenants arising from the environmental review of land use actions will also shift from DEP to the Director of OER.
Amendments to the New York City Administrative Code:
The newly amended Title 24, Chapter 9 of the Code establishes OER’s authority to create and implement the LBCP. To understand the elements of the LBCP, a look at the specific powers granted to OER is required. This section briefly describes certain provisions of this amendment.
Section 24-902 provides definitions for the terms used throughout the LBCP, including what constitutes a “local brownfield site.” A “local brownfield site” is defined as real property located within the physical parameters of New York City, “the redevelopment or reuse of which may be complicated by the presence or potential presence of light to moderate levels of contamination or any real property that meets the definition of a delegated brownfield site….” This definition specifically designates sites contaminated with historic fill and sites rejected from the New York State BCP for failure to demonstrate sufficient environmental contamination as sites that are eligible for admittance to the LBCP. The local brownfield site definition also describes sites that are excluded from the LBCP, such as sites already investigated through a State or Federal program, or sites with petroleum contamination.
The eligibility criteria for prospective LBCP sites are further defined in Section 24-904. Under this section, OER is authorized to accept or reject any site. However, Section 24-904 specifically states that OER shall reject a site if: (1) it fails to meet the definition of a local brownfield site as defined under Section 24-902; (2) there is an action or proceeding relating to the site currently pending in a civil or criminal court against the applicant; or (3) there is an order against the applicant calling for an investigation, removal, or remediation of contamination at the site. In addition, Section 24-904 reserves the right for OER to reject an applicant who has otherwise satisfied all the requirements for entrance into the LBCP if OER determines that the public interest would not be served by accepting that site into the program.
Rules and Regulations:
Under Section 24-903, the Director of OER is authorized to establish rules and regulations that will allow for the efficient operation of the LBCP. This section contemplates that rules need to be promulgated to develop a standardized process for entrance into the LBCP. For example, rules will be required for constructing an application form, developing an application review process and creating local brownfield cleanup agreements. Section 24-903 also foresees OER establishing rules to outline the requirements for remedial reports and remedial action work plans, and rules to define the procedures that will ensure that proposed remedial actions are protective of the public health and the environment. OER will also create rules that encourage citizen participation and provide notice to affected communities of brownfield sites that have applied for entrance into the LBCP. In addition, rules will be necessary to permit OER and its staff to gain access to site contamination information, as well as physical access, to any site that has either requested entrance, has already been enrolled, or has received a Certificate of Completion from the LBCP. Furthermore, OER will create rules that determine when remedial actions are complete and when a site is eligible to receive a Certificate of Completion (as discussed below). There will be rules to establish enforcement mechanisms to ensure that sites that have completed the program continue to operate all institutional and engineering controls as required. Finally, rules will be formulated that require an enrollee to provide notice to OER of any change of use at a LBCP site; however, OER may prohibit that change of use if it can show cause. Thus, once promulgated, these rules will flesh out the details of the LBCP and ensure its effective implementation.
Certificate of Completion:
Section 24-906 establishes the guidelines for awarding a Certificate of Completion to a site that has successfully navigated through the LBCP. The Certificate of Completion will demonstrate that the enrollee has fulfilled the requirements of the LBCP and will include a statement affirming that the City will not take any further investigatory or remedial action against the site or the enrollee regarding the addressed contamination. The Certificate of Completion will also contain a recommendation by the City that no other government agency take action against that site or the enrollee. Moreover, the Director of OER is currently seeking to enter into agreements with State and Federal agencies to strengthen the Certificate of Completion to include a statement, rather than a recommendation, that State and Federal agencies will not take any further action at that site regarding the addressed contamination. However, despite the non-enforcement assurances of the Certificate of Completion, Section 24-906 describes certain circumstances where OER may retain the right to take future action against a site or an enrollee. Specifically, the City may take investigatory or remedial action when there is a change in an environmental standard or when environmental contamination still present at the local brownfield site renders the remediation no longer protective of the public health or the environment. Section 24-906 also reserves the right of the City to further investigate or take remedial action when there is non-compliance with a cleanup agreement reached under the LBCP or when there is fraud or a change in use at the local brownfield site. Finally, Section 24-906 provides that the Certificate of Completion will run with the land and will extend to the enrollee’s successors and assigns. However, under this provision there is a duty for the successors and assigns to act with due care and in good faith to adhere to the obligations of any agreement established under the LBCP. Therefore, if there are any institutional or engineering controls required at the site, the successor or assign will be responsible for maintaining such controls in order to preserve the validity of the Certificate of Completion. Receiving and maintaining a Certificate of Completion is important because this serves as a valuable marketing tool to assure an interested buyer that the site remediation was performed in compliance with City standards.
The LBCP also contains a robust citizen participation component. When a site applies for admission into the LBCP, Section 24-905 requires OER to provide notice of the application to borough presidents, council members and community boards located in the district where the local brownfield site is situated. Notice must also be given to residents living on or adjacent to the local brownfield site and to all appropriate community groups. Furthermore, OER will provide the opportunity for public comment and will make documents submitted by the applicant available to the public prior to OER’s decision to accept a local brownfield site into the program. The LBCP thus reflects the intent to involve members of the community in the brownfield redevelopment process and provides interested parties with a meaningful opportunity to comment on the proposed remediation and redevelopment.
To ensure compliance, the LBCP contains provisions that allow for the assessment of civil penalties and the withholding of building permits under certain circumstances. Section 24-907 provides that civil penalties will be assessed against any applicant, enrollee or holder of a Certificate of Completion who is found to have misrepresented a material fact to OER regarding the local brownfield site’s investigation, remediation or management. Such penalties will be recoverable after a proceeding before the New York City Environmental Control Board. Under Section 24-908, OER is authorized to notify the New York City Department of Buildings (“DOB”) when a site has failed to properly maintain any institutional and engineering controls required by an agreement or document entered into under the LBCP. Once notified, the DOB will withhold issuing permits to that site. Through these provisions, OER is afforded the enforcement mechanisms needed to maintain the integrity of the LBCP and to ensure that the stated remediation and redevelopment goals are met.
The Future of Brownfields Regulation:
The passage of this Act signals the beginning of a new era in brownfields regulation. This Act created the nation’s first regulatory program designed to address brownfield redevelopment from a municipal level, rather than from the State or Federal levels. There are many advantages associated with local regulation of brownfield sites. For example, local governments can be a source of additional funding and oversight for brownfield cleanups, local officials may be more familiar with the local brownfield sites than their counterparts at the State or Federal government and local offices usually are better situated to promote community involvement. In addition to the inherent benefits of local regulatory oversight, the LBCP specifically aims to establish a streamlined process that will allow local brownfield sites to quickly and efficiently pass through. This avoids costly time delays, which, in the past, may have dissuaded parties from participating in a brownfield regulatory program administered by the State or Federal government. Given the variety of benefits facilitated by local regulation, and by the LBCP in particular, it would not be surprising to find the LBCP serving as the impetus that encourages other municipalities to adopt their own local brownfield cleanup programs. Thus, the municipality may emerge as a significant player in the realm of brownfields regulation.