| BUILD Act Clarifies CERCLA Protections for Tenants |
Recent changes to federal law have clarified the applicability of environmental liability protections extended to tenants.
Earlier this year, President Trump signed the Consolidated Appropriations Act of 2018. It contains the "Brownfields Utilization, Investment, and Local Development Act of 2018" (the "BUILD Act"), which revised key sections of the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"). Brownfields are sites with a presence or potential presence of hazardous substance contamination. CERCLA was enacted in 1980 to impose liability on parties responsible for the release of hazardous substances onto property.
CERCLA holds responsible parties (i.e. owners or operators) strictly liable for "response costs" incurred as a result of a "release" or "threatened release" of "hazardous substances" from a "facility." Limited liability protections are available to innocent purchasers, contiguous property owners, and bona fide prospective purchasers. The liability protection for bona fide prospective purchasers, known as the "Bona Fide Prospective Purchaser Defense" was created after the defense for innocent purchasers was found to be inapplicable to property a bona fide prospective purchaser knew was contaminated.
To qualify for the Bona Fide Prospective Purchaser Defense, a party must:
- Have acquired the property after the Brownfields Revitalization Act was enacted on January 11, 2002;
- Establish that disposal of the hazardous substance occurred before the property's acquisition;
- Have made all appropriate inquiries into the previous ownership and uses of the facility;
- Comply with all release reporting requirements;
- Take appropriate care to stop any continuing release of contaminants and prevent or limit environmental exposures from any previous releases;
- Cooperate with authorized persons conducting response activities or natural resource restoration on the property;
- Comply with any remedial land use restrictions, not impede site institutional controls, and provide access to persons authorized to ensure the integrity of land use and institutional controls at the site;
- Comply with any Environmental Protection Agency ("EPA") requests for information or administrative subpoenas issued under CERCLA; and
- Establish there is no affiliation with a potentially liable party, other than a relationship created by title transfer instruments, by a tenancy, by instruments creating a leasehold interest, or by a contract for the sale of goods or services.
One of the most important changes from the BUILD Act is a clarified path for tenants to qualify for the Bona Fide Prospective Purchaser Defense. Previously, tenants could have been liable for contaminated property because the law did not specify how they could protect themselves from liability. A bona fide prospective purchaser was classified as "a person (or a tenant of a person)" who acquired ownership of a facility with the potential or present release of hazardous substances after January 11, 2002. However, even though tenants were included as parties who could claim the Bona Fide Prospective Purchaser Defense, CERCLA did not specify the rights or responsibilities for tenants to have the ability to claim it. CERCLA only specified the rights and responsibilities for a landlord or property owner.
With the passage of the BUILD Act, the rights or responsibilities of tenants concerning the Defense have now been clarified. To qualify for the Bona Fide Prospective Purchaser Defense, tenants must:
- Demonstrate that the leasehold interest in the facility was acquired after January 11, 2002; and
- Prove that the leasehold interest is not designed to avoid liability under CERCLA by any person; and meet any of the following criteria:
- The landlord qualified for the Bona Fide Prospective Purchaser Defense by meeting the requirements set forth in the bullets above.
- The landlord complied with CERCLA requirements, but later failed to maintain compliance with those requirements at no fault of the tenant.
- The tenant itself qualifies for the Bona Fide Prospective Purchaser Defense by meeting the requirements set forth in the bullets above.
Additionally, leases are now included in the same exclusion covering title transfer instruments and contracts for the sale of goods or services.
Other noteworthy revisions to CERCLA include express language allowing 501(c)(3) nonprofit organizations to receive brownfield revitalization funding and new authorization criteria for the EPA process for brownfield grants, such as remediation grant expansions, new multipurpose brownfield grants, and authorization for government entities to receive grants for property acquired prior to creation of the BUILD Act.
Our Land Development, Zoning & Environmental team has extensive experience advising clients on all matters related to brownfields, CERCLA, and qualifying for the various CERCLA defenses, including analyzing whether tenants may claim these defenses. For more information, please
contact us.
|
|
MEET THE AUTHORS
Special thanks to Nicole Neugebauer, who assisted in the drafting of this update. Nicole is a second-year Juris Doctor Candidate at Stetson University College of Law.
|
|
Developer Denied Relief Under Bert Harris Act For Failure to Formally Apply to Develop Property
After a reduced building height ordinance was passed on Hollywood Beach, a developer sued under the Bert Harris Act because the ordinance would prevent the development of its 15 story condominium. However, because the developer never formally applied for a permit or variance, the court denied relief.
View More
|
|
Under Bert Harris Act, Existing Zoning is a Non-Speculative Land Use, and Law of Takings Does Not Apply
The Fourth DCA held that a County decision denying an application for a concrete batch plant following a change in the zoning code from light industrial to general industrial satisfied the non-speculative land use requirement for entitlement under the Bert Harris Act, but not under the law of takings.
View More
|
|
Local Governments Do Not Owe a Duty to Convey Accurate Information Regarding Their Codes
After a property owner sought City approval to renovate existing commercial property, followed proper procedures set forth in the City's development code, and relied on representations by City employees that the renovation would be approved, the project was ultimately denied. The court found the City bears no statutory or common law duty to furnish accurate information regarding its City code.
View More
|
|
Current Miami-Dade Tax Collector's Unilateral Change to Paying Interest on Tax Assessment Reductions Obtained Via Settlement Prompts Taxpayer Class Action
Taxpayers, who obtained reductions in their ad valorem assessments by agreement with the Property Appraiser, but without a Value Adjustment Board ("VAB") hearing, were refused interest on their refunds by the current Miami-Dade Tax Collector (who also demanded refunds of interest paid by the prior tax collector). The Tax Collector took the position that interest was payable to a taxpayer only after a VAB hearing and a written VAB decision reducing the challenged assessment. This interpretation was a surprise to taxpayers, as the previous tax collector did not require a formal VAB hearing nor a written VAB decision. Taxpayers brought a class action contesting his actions and the trial court dismissed the complaint with prejudice. The Third DCA reversed, finding that nothing in the law required a VAB hearing as a condition to interest on a taxpayer's refund and remanded it for reconsideration on the merits.
View More
|
|
Eleventh Circuit Affirms $1,489,700 Verdict In Favor of Beachfront Property Owners in Takings Suit Against the City of St. Pete Beach
Owners of a beachfront property filed a "takings" action against St. Pete Beach, alleging the City gave the general public access to their property, a violation of the owners' Fourth Amendment rights. The Eleventh Circuit, in affirming the trial court, held that the evidence was sufficient to support a jury verdict in support of a "takings" claim and the city was not entitled to a transfer of fee title to the beachfront property. However, the court did award the City a permanent beach easement across the disputed property.
View More
Condominium Associations Cannot Represent a Defense Class of Unit Owners in Lawsuits Brought by Property Appraiser
After two condominium associations filed a joint petition with the Miami-Dade County Value Adjustment Board (VAB) regarding proposed assessments for the units in each respective condominium building and received substantial reductions in the assessed value in the VAB decision, the property appraiser appealed in separate lawsuits for each condominium, with the defendants being the individual unit owners. The court held that under Section 194.181, Florida Statutes, the individual taxpayers must be party defendants in an action brought by the county property appraiser to appeal a VAB decision. Condominium associations may sue or be sued on behalf of their unit owners in actions of eminent domain only.
View More
Second DCA Affirms Requirements to Ripen a Regulatory Takings Claim
When a property owner sued to protect his private property rights under Article X of the Florida Constitution and the Bert Harris Act, the court found that the complaint did not state a ripe cause of action. To have a regulatory takings claim ripe for adjudication, plaintiffs must demonstrate that they have both received a final decision regarding the application of the challenged regulations to the property at issue and sought compensation through proper state procedures.
View More
Third DCA Asks Legislature to Codify Method for Addressing Presumptively Invalid Petitions
Petition supporters seeking adaptation of a village charter to require voter approval on the sale, lease or disposal of real property and require a vote to approve of certain, defined commercial development were denied relief even though they acquired a sufficient number of signatures. Following Section 163.3167, Florida Statutes, an initiative or referendum process in regard to any development order is strictly prohibited. The court acknowledged the statutory gap for how a municipality should address petitions that appear invalid and called for the Legislature to address the issue.
View More
Property Owner Cannot File Mandamus Action Over Site Plan Condition Limiting Vehicular Access When it is Not a Criterion of Conditional Use Approval
Gateway Partners sued the Village Council over a condition restricting cross-access to property from adjacent commercial property to pedestrians, bicycles, and golf carts only. Gateway filed a petition for mandamus because the site criteria were satisfied by its initial application, which included access by vehicles. The Third DCA held that mandamus review does not apply in this case, but that no sanctions by the opposing party will be upheld since a claim for mandamus review is a good-faith argument for extension of existing law with a reasonable expectation of success to have the condition deleted.
View More
FWC Owes No Duty to Stop Hunters from Trespassing on Property When Otherwise Permitted by a Hunting License
After deer dog hunters continuously trespassed on their land, Appellees sued the Florida Fish and Wildlife Conservation Commission (FWC) under an inverse condemnation claim for violation of their right to quiet enjoyment. Overturning the trial court, the First DCA ordered summary judgment in favor of the FWC on sovereign immunity grounds because the authorization of deer dog hunting is a discretionary function of an administrative agency. Permitting an injunction to abate all deer dog hunting nuisances would be a direct violation of the separation of powers doctrine.
View More
|
|
Sabrina Weiss Robinson
Ad Valorem Tax
|
Sabrina's Practice:
Sabrina has nearly 30 years of commercial litigation experience, including 15 years focused exclusively on challenging property tax assessments. Sabrina helps owners, tenants, managers, lenders and developers throughout Florida reduce their tax liability through administrative appeals before Value Adjustment Boards and in Circuit Court. She has extensive experience in valuation appeals for various types of property, including retail centers, big box retailers, anchor department stores, office properties, hospitality, industrial, apartments, assisted/independent living facilities, vacant land and tangible personal property. Each year Sabrina appeals over 1,000 property valuations.
|
|
Notable Experience: In 2017, Sabrina represented one of the largest discount store retailers in the United States achieving reductions of market values totaling in excess of $28 million for locations in South Florida. She also represented a national home store achieving reductions of market values totaling in excess of $36 million for locations throughout Florida.
|
|
|
EXECUTIVE ORDER PERMIT EXTENSION TRACKER
|
|
|
