Resolved: Let’s Make Brownfields Work!

By Richard G. Opper

Richard G. Opper is a principal in Opper & Varco LLP in San Diego, California, and the Section’s Communications Director. The author can be reached at ropper@Envirolawyer.com.

I n 2001 a Congress shaken from 9/11 sought a basis for bipartisan action and found it in brownfields. The good work that could be accomplished by cleaning sites, combined with the economic development such activity could provide, was an irresistible attraction and it led to broad and bipartisan support of the brownfield bill. In January 2002, President Bush signed the Act into law but we are, sadly, still waiting for some of the Act’s most telling amendments to have an impact on the marketplace for brownfield properties.

There are many reasons for this, but perhaps most important is the fact that the rulemakmg process necessary to support “reliance” on some of the Act’s new ideas is still ongoing. In the view of some it has taken an extraordinary amount of time and energy to gather the views of the many different stakeholder groups from around the nation, so that crucial definitions, such as what constitutes “All Appropriate Inquiry,” can be promulgated and adopted. U.S. EPA’s attention has been focused on these immediate issues, partly because they are the first critical step toward implementing the new law. Unfortunately, the amount of energy devoted to this rulemaking has caused us to miss other opportunities for reform and advancement of the congressional mandate to redevelop brownfields. We should not only think of rulemaking in terms of the specific tasks needed to implement the Act, but we should also consider strategic rulemaking to further the Act’s purposes.

There are strategic opportunities for rulemaking that could address the very root of some of the most vexing problems of brownfield redevelopment, which admittedly stem from the very law adopted to address the disposal of hazardous waste, CERCLA. CERCLA has become the alpha and the omega of cost recovery for hazardous waste for many interesting (if frustrating) reasons, and cities and private entities involved in cost-recovery disputes essential to brownfield redevelopment rely on the statute just as frequently (if not more so) than the U.S. EPA. Among the challenges posed to the practitioner using CERCLA is the requirement, under that statute, of ensuring that any cost recovery actions are for costs incurred consistent with the National Contingency Plan, or NCP. Many practitioners, however, have noted that trying to adopt the requirements of the NCP to a brownfield redevelopment project often poses challenges that clearly frustrate Congress’ intent to achieve brownfield reform.

Because CERCLA was originally designed to provide a governmental remedy at the nation’s most dangerous locations, those on the National Priority List, the NCP was not initially conceived with an eye toward how mitigation of environmental conditions can be accomplished within the scope of an ordinary real estate transaction. It is, of course, the ordinary real estate transaction that is required for success at 90 percent of the nation’s brownfield sites. Providing a process that is amenable to a “regular” real estate transaction requires a process that is both predictable and understandable in order that everyday buyers and sellers of property can acquire and improve property knowing what will be required of them. Regulatory policies designed with this goal in mind could result in the most effective brownfield reform policy seen yet in this country.

If the NCP, designed as an enforcement tool at the nation’s mega-sites, isn’t working effectively at the typical brownfield urban-infill redevelopment site, why can’t the U.S. EPA amend it? The NCP is a compilation of federal regulations that has been amended many times. Given the extraordinary and dramatic reforms that Congress attempted to achieve after 9/11, shouldn’t we revisit the NCP to determine whether further amendment and the adoption of policies designed to work within the context of a real estate transaction could be developed? It shouldn’t be so terribly difficult to adopt appropriate processes designed for these urban brownfield sites, which are often less threatening to the national environment, but just as important to a communities’ economic and environmental health.

Surely it could be possible to address some of the process issues that the NCP elaborates in a somewhat more simple and practical form. A casual reader of the NCP, for instance, comes away from it with a long list of documents that consultants must produce and present for review and approval in the course of any “NCP-consistent” cleanup. An almost endless series of investigations, remedial investigations, and feasibility studies, work plans, and an alphabet soup of acronyms can all be used to keep consultants and regulators busy, when, frankly, they have better things to do. It would be quite simple to adopt a statement in the NCP to the effect that, “when necessary and appropriate, all of the different analyses and documents required to propose a mitigation plan for a brownfield project can potentially be put into one document for review and approval.”

There are many cases (urban gas stations, dry cleaners, and auto salvage yards) where it ought not to be necessary to ignore the fact we have done these hundreds of times and know basically what to expect, although by and large the people who monitor compliance with the NCP seem to want to reinvent that wheel on site after site. Just the idea that the various analyses can be combined in flexible and creative ways to respond to the time sensitive needs of a real estate transaction would be tremendously helpful to many people who are trying to use this statute every day.

Using CERCLA to address brownfield problems is like trying to push a square peg into a round hole. Using the regulatory process to soften the edges of that peg so that it fits more easily into the brownfield paradigm should be a goal shared by the U.S. EPA and communities everywhere. Recently, an idea was generated within the Section of State and Local Government Law that quickly migrated to the Section on Environment Energy and Resources (SEER). This idea was to adopt a resolution at the House of Delegates of the American Bar Association that would call for U.S. EPA to begin work on amendments to the NCP to this end. A process should be started to adopt a “brownfields chapter” of the NCP to help realize the ambitions of a unanimous Congress by trying to find ways to stimulate brownfield redevelopment across the nation. Regulatory attention has been so focused on the critically needed rules required to enable some of the statutory reforms, that there has been too little discussion of potentially strategic rulemaking approaches to how the U.S. EPA can support brownfield redevelopment nationally in an effective manner.

Amendments to the NCP do not require legislation. Congress made its desire for brownfield reform crystal clear when the bill passed 99 to 0 in the U.S. Senate. Legislative changes are difficult to achieve and require many years of effort, and if past CERCLA re-authorization bills are any indication, future changes will be very slow in coming. A regulatory approach, giving voice to Congress’ mandate by addressing the needed policies through means available to the executive branch, is the ideal method to seize the day.

The resolution, urging U.S. EPA to amend the NCP to address brownfield issues, came out of the two sections and inched its way forward through the committee process. It came before SEER’s Council at its spring meeting in New York this year. There, proponents of the resolution from the Environmental Transactions, Audits and Brownfields Committee were told to pause in their campaign and redraft the resolution to include more detail about the approach, or perhaps the principles, that should guide the authors of any future NCP amendment designed to be helpful. A new draft of the resolution will soon make the rounds, through interested parties in several sections, in an effort to address those concerns, without proscribing how a brownfield chapter would ultimately appear. It is an exciting activity and one that has the promise of significant strategic benefit for the future. As your Section continues its discussion on this issue your participation and ideas are solicited and desired. Please don’t hesitate to share your thoughts with the author of the resolution (coincidentally also the author of this article). I look forward to hearing from you and to further discussion about this novel and strategic idea.