Fresh off its hotly anticipated August 2014 decision upholding the right of municipalities to zone oil and gas extraction operations out of their towns, the New York State Court of Appeals is set to weigh in on another oil and gas extraction issue. This latest matter arrived at the Court of Appeals through a somewhat unusual route, but promises to decide whether landowning lessors or industry lessees bear the cost of state level regulatory inaction on high volume hydraulic fracturing of shale with horizontal drilling (also known as fracking).
As most folks in the commercial real estate industry know, the Bona Fide Prospective Purchaser exemption from liability under the federal Superfund law is a very useful tool. Accordingly, a Phase I Environmental Site Assessment is standard practice for nearly every purchase of commercial real estate because it helps to satisfy EPA's "All Appropriate Inquiries" requirement for obtaining BFPP status and avoiding the often harsh liability associated with Superfund.
Everyone's heard of the phrase, "Be careful what you wish for," but Sunoco, Inc. might be ready to coin a new phase, "Be careful what you warrant."
Can a party who is not the holder of a certain environmental permit be required to perform the obligations set out in that permit? The New York State Department of Environmental Conservation thought so, and argued as much in the case of a property owner who had purchased land where a hazardous waste storage facility had operated years earlier. The purchaser, Thompson Corners, LLC, had never held a permit to operate the facility, which had closed years before the purchase, and was never required to obtain one.
How easily can a significant expansion in jurisdiction be called just a "clarification" of existing jurisdiction? On April 21, 2014, the United States Environmental Protection Agency and the Army Corps of Engineers published a proposed rule that promises to significantly change federal Clean Water Act jurisdiction. While EPA Administrator Gina McCarty has described the proposed rule as merely a clarification of existing EPA authority, if finalized, it will likely expand CWA permit requirements to include minor tributaries and even seasonal waters such as vernal pools as "waters of the United States."
The health threats posed by physical contact with contaminated soil or groundwater are well known. But increasingly, state and federal regulators are recognizing that harmful vapors from such contamination can be drawn into nearby buildings and pose a threat to the occupants. Known as soil vapor intrusion, this threat can come from undiscovered contamination beneath a building, or even from the remnants of previously remediated soil or groundwater.
Many insurance policies contain a "pollution exclusion" which seeks to exclude coverage for losses arising from pollution, except in the case of a "sudden and accidental" release. "Sudden and accidental" may bring to mind a burst pipe or overturned tanker truck, but a recent decision in the United States District Court for the Southern District of New York suggests that the interpretation can be much more complicated.
EPA has just extended to tenants the Bona Fide Prospective Purchaser ("BFPP") protection, by which Congress previously exempted certain prospective owners from harsh Superfund liability. Even where the landlord loses its BFPP protection, the new EPA enforcement guidance memo allows tenants to hold onto it, assuming the tenant can meet certain requirements.
During the summer of 2012, the DEC proposed its first substantive amendments to the State Environmental Quality Review Act (SEQRA) regulations since 1996. The DEC has explained that the amendments are meant to streamline the review process "without sacrificing meaningful review," but the potential impact of the proposed amendments appears to be somewhat mixed. The proposed amendments center most notably on the "scoping" process, the classification of certain types of projects, and the timeline of the SEQRA process.
A federal court in New York recently decided that the migration of subterranean contamination onto a neighboring property was not, by itself, a sufficient basis to hold a neighboring landowner jointly liable for remediation costs under the federal Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA").