Natural Resources and Environmental Protection Act Archives - Dawda PLC

Old Tank Sites Subject to New DEQ Initiative

Editor — Tue, 29 Dec 2020 18:24:03 +0000

The MDEQ is increasing its review of dormant but open leaking underground storage tank (“LUST”) sites. This informal initiative is designed to resolve site status at open LUST locations. The MDEQ is requesting access to most open LUST sites to perform investigative work. One risk, though, is that owners of such sites may be required to reimburse the MDEQ for this work.

MDEQ requests access regardless of previous environmental reports showing no levels of contamination. While the prior reports do not constitute a final closure of a LUST site, they may demonstrate that these old sites do not pose a threat. Presumably, the MDEQ’s effort will result in a reduction in the number of listed contaminated sites throughout Michigan.

If an owner requests additional information, such as a work plan, or somehow delays a response to the request, the MDEQ may classify such a response as a “denial”. In the case of a denial for access, the MDEQ will refer the matter to its Compliance and Enforcement Section for further evaluation. The MDEQ may then conduct a liability determination, which may take several months, to determine if the owner is a liable party. If liable parties are identified, the MDEQ will issue a request under Part 213 for the owner to conduct an initial assessment report or a final assessment report regarding the open LUST release.

If a liable party cannot be found, the site will revert to “orphan” status and the State will continue to spend resources to investigate the LUST release at the site. Court proceedings may be necessary to obtain access.

The MDEQ will typically not provide a complete work plan to the Owner when it requests site access due to time and budget constraints. The owner is typically allowed to take split samples of soil or groundwater samples. Owners have an option to conduct additional work at their sites to control information and otherwise acquire information relevant to the MDEQ’s request. Where time has lapsed and other contaminants may become relevant, it is important to enlist the support of a competent environmental consultant as well as a lawyer to determine the best course of action.

The post Old Tank Sites Subject to New DEQ Initiative appeared first on Dawda PLC.

On Site Soil Movement: Part 201 or Part 111?

Editor — Sat, 07 Jan 2012 19:43:47 +0000

So what do you do if you own a contaminated property that is a “facility” under Part 201 of NREPA (Natural Resources and Environmental Protection Act) and you want to move dirt from one location on site to another?

Section 20120c(3) says you can do it if you apply the same degree of control in the new location that would need to have been used at the original location. But is that relocation then restricted by the requirements of Michigan’s solid waste statute (Part 111 of NREPA)? Some say it would.

The DEQ is aware of this conflict and is working on an amendment to the “other wastes regulated by statute” exemption in Rule 110. The amendment would exempt from Part 111’s scope any contaminated soils that are moved on-site provided it is done in accordance with Part 201. Right now the amendment is being held up because of the freeze that the Office of Regulatory Reform has on all State regulations while they review the ones that are considered overly burdensome.

See our Client Alert for more information on on-site and off-site soil movement under Part 201.

The post On Site Soil Movement: Part 201 or Part 111? appeared first on Dawda PLC.

Baseline Environmental Assessments and Landlord Refinancing

Editor — Tue, 13 Dec 2011 20:16:15 +0000

Here’s an interesting issue that landlords throughout Michigan may be seeing more of when they seek refinancing. Remember the Court of Appeals decision last year in 1031 Lapeer LLC v. R.L Price Properties? Banks remember it all too well. It was that pesky little case that reminded all of us that Part 201 of NREPA (Natural Resources and Environmental Protection Act) imposes an obligation on parties involved in real estate transactions to disclose that the property is contaminated.

In 1031 Lapeer, the tenant sought to void a lease with its landlord because the landlord failed to disclose that the premises were contaminated. The trial court ruled in favor of the tenant and the Court of Appeals upheld it because Part 201 Section 16 specifically states that if a party knows or is on notice that its property is contaminated, then it shall not transfer an interest in the property unless it has provided notice of that fact and the general nature of the contamination to the transferee. Based on the ruling in 1031 Lapeer, the notice requirement applies to sellers and landlords and failure to adhere to it can create a pretty harsh result – voiding the transaction.

Lenders have keyed in on this issue for obvious reasons; if their landlord or borrowers have redeveloped a contaminated property but have not disclosed the existence of the contamination to the tenants, the landlords are at risk of losing tenants (and thus the rent). With the current glut of retail and office space, this could mean a loss of income and the lender being saddled with a contaminated parcel – not a desirable picture from the bank’s point of view.

If you are a landlord that did not notify your tenants that the property they are renting is a Part 201 facility before they signed the lease, the bank may request that you provide the notice after the fact before the bank commits to refinance.

How do you handle that? Very carefully and with good legal counsel!

The post Baseline Environmental Assessments and Landlord Refinancing appeared first on Dawda PLC.