CT LEGISLATURE | Transfer Act & Environmental Justice Law Modifications
On October 2, 2020, Governor Lamont signed two environmental bills into law. These bills serve to modernize and update the state’s environmental laws, as well as protect environmental justice communities from potentially harmful development. The bills will undoubtedly have a wide ranging impact across industries for years to come.
“An Act Revising Provisions of the Transfer Act and Authorizing the Development and Implementation of a Release-Based Remediation Program” (House Bill No. 7001)
HB 7001 made changes to the Transfer Act, which governs the transfer of properties deemed to be or likely to be polluted. The changes eliminate or modify certain exemptions. These changes are effective immediately and include the following:
- Shopping centers that include a tenant whose space qualifies as an “establishment” (such a dry cleaners) were previously subject to the Transfer Act. Now, the transfer of the shopping center will only require investigation and remediation of the “establishment” portion of the shopping center.
- Changing the name of an LLC will not trigger a “transfer of establishment”.
- Increases the exemption threshold for the transfer of an interest in a business from 40% to 50%.
- Certifying parties are more accountable to deadlines for filing Transfer Act forms, initiating remediation, and completing remediation.
The Transfer Act has been law in Connecticut since 1985. The Transfer Act requires investigation and, if necessary, the remediation of an “establishment” upon transfer of certain properties or businesses. After years of unintended consequences, CT DEEP and CT DECD determined that an overhaul was necessary to spur growth and development of properties that had been neglected, in whole or in part, due to the Transfer Act’s overly onerous requirements. HB 7001 effectively serves to sunset the Transfer Act in Connecticut at a yet to be determined date in the future.
HB 7001 sets the framework to eventually replace the Transfer Act with the development and implementation of a “release based” remediation program. The release based program shifts the focus from investigation and cleanup at the time of transfer to the time of the discovery of a “release”. HB 7001 defines release broadly, but it is clear that any person who creates or maintains a release is responsible to report and remediate; this definition should be clarified by the forthcoming regulations.
HB 7001 authorizes CT DEEP to draft and promulgate regulations that will define the details and scope of the release based program. It could be several years before these regulations are promulgated. In the meantime, the Transfer Act remains law.
“An Act Concerning Enhancements to the State’s Environmental Justice Law” (House Bill 7008)
Connecticut has had an environmental justice law in place for the last 12 years, but it has failed to meet expectations of community groups and regulators. HB 7008 revises the law so that applicants seeking to construct or expand “facilities” in environmental justice or distressed communities are now required to post notices and notify elected officials about the public meeting for the proposed facility.
Additionally, applicants are now required to enter into a community benefit agreement with the municipality in which the facility is to be located if the municipality already hosts five or more “facilities”. This more than likely includes municipalities such as New Haven, Hartford, Waterbury, Stamford, New London, and possibly many others. The community benefit agreement shall consider impact to the environment, including, but not limited to, air quality and watercourses, quality of life, asthma rates, traffic, parking, and noise.
Applicable facilities include, for example, electric generating facilities exceeding ten megawatts, sewage plants with capacity to exceed fifty million gallons per day, or a facility requiring a certificate under Chapter 277a of the General Statutes. Environmental justice communities are defined as communities located in census blocks where thirty percent of the population is low income individuals (below 200% of the federal poverty level), or communities defined as “distressed” by the Department of Economic and Community Development.
HB 7008 goes into effect on November 1, 2020, but will not affect applicants with pending permit applications.
Please contact a member of the UKS Environmental Practice Group with questions regarding this Client Alert.
Updike, Kelly & Spellacy, PC would like to thank associate Jeffrey Bausch for his contributions to this Alert.
Disclaimer: The information contained in this material is not intended to be considered legal advice and should not be acted upon as such. Because of the generality of this material, the information provided may not be applicable in all situations and should not be acted upon without legal advice based on the specific factual circumstances.