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IN DEPTH >> CALIFORNIA
Land Reuse and Revitalization Act of 2004: A Landmark
Shift for Brownfields
Taking a significant step toward fulfilling one of his campaign promises for the environment to rapidly address California’s brownfields, Governor Arnold Schwarzenegger recently signed legislation to promote the redevelopment of brownfields.
On September 23, 2004, Governor Schwarzenegger signed the California Land Reuse and Revitalization Act of 2004 (AB 389, Montañez, Chapter 705, Statutes of 2004) into law. This new law, which takes effect on January 1, 2005, is designed to provide liability relief for brownfield developers in California.
Under the new law, site purchasers and owners will not be held liable for property contamination they are not responsible for as long as they take prescribed steps. In addition, the law limits “reopeners.”
The bill aims to remove significant disincentives that often cause developers to look to clean properties or greenfields rather than invest in urban properties. These previously used properties often lay fallow because of their history and the possibility that their industrial past has left them tainted with chemical contamination. The bill gives new guarantees that developers won’t be pressured to clean properties after they’ve already been cleaned to state standards.
Developed around the framework and terms of the federal Small Business Liability Relief and Brownfields Revitalization Act, the California Land Reuse and Revitalization Act of 2004 is intended as a practical application of those federal provisions in California.
In many respects it goes beyond what the federal bill provides. While the federal bill provides “defenses” to liability under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or Superfund), the California Land Reuse and Revitalization Act provides “immunities” from environmental liabilities, not only the State’s Superfund equivalent, but any and all state laws that create a cleanup obligation.
This bill has the potential of becoming a landmark shift for brownfields in California. Key elements of the new law include:
• Its provisions are entirely voluntary – other tools continue to be available (including traditional Prospective Purchaser Agreements).
• Eligible sites are those within incorporated cities or in unincorporated areas surrounded by developed parcels.
• Provisions apply to bona fide purchasers, innocent landowners and contiguous property owners.
• To qualify for the liability protections, owners:
– Must first make (or have made) appropriate inquiry• Appropriate care is defined as entering an oversight agreement with a state agency, investigating the site and cleaning it up to agency’s satisfaction (to current agency standards).
• Oversight can be by either the Department of Toxic Substances Control (DTSC) or a Regional Water Quality Control Board (RWQCB).
• Immunity “attaches” when the oversight agreement is signed.
• Reopeners are allowed only if the site conditions endanger public health and safety and no other responsible party or Underground Storage Tank Trust funds (for petroleum releases) are available.
• Immunity for past releases is not affected if there are releases in the future. (They are dealt with separately.)
• Liability relief is transferable to future owners.
The law sunsets in five years (unless extended), although the immunity provided would continue beyond that period as long as the owner is in compliance with the ongoing requirements of the agreement and cleanup plan (including institutional controls).
The bill was the result of lengthy and extensive discussions among numerous stakeholders, including the Homeowners Advancement Foundation and the California Building Industry Association (its sponsors), state agency representatives, environmental and community interests, local governments and legislative staff, with an agreeable compromise being forged on the very last day of the legislative session.
DTSC and the Regional Boards are developing fact sheets and other resources to use in implementing this new law. We don’t yet know whether it will be used, or to what extent. We hoped to capture the very sensitive balance between public health and environmental protections and liability concerns that have long stymied brownfield development. California brownfields are entering a new era.
By Rick Brausch, assistant secretary for brownfields and toxic substance
programs for the California Environmental Protection Agency.