REMEDIATION REQUIRED BY REGULATION OR PURSUANT TO PA ACT 2

State enforcement action arises in two ways: 1) Issuance of a compliance order after site inspection reveals non-compliant waste storage or evidence of leaks and spills; 2) Issuance of an order or commencement of unilateral remediation in response to discovery or reporting of a significant spill or groundwater contamination.  

In order to incentivize site cleanup and redevelopment, most states also have “voluntary” cleanup programs such as Pennsylvania Act 2.  These allow parties to investigate and remediate property and receive state agency approval and statutory liability release commensurate with the degree of“cleanup” accomplished. These programs include a risk-based “site-specific standard” which can be attained with a combination of remediation, monitoring, and a recorded Environmental Covenant setting forth maintenance requirements and land use restrictions.  State approval documentation as well as the statutory liability release are often critical for sale of property or financing.     

Environmental counsel can give valuable advice to clients regarding the trade-offs associated with extent of remediation and future land use limitations and restrictions which are often imposed as conditions of approval. Counsel can also resolve state claims for remedial cost reimbursement or civil penalties.    

 selected experience
  • Representation of building owner in addressing TCE and petroleum groundwater contamination as well as  vapor intrusion issues, caused several decades earlier by an industrial tenant.

  • Representation of non-profit entity after discovery that previously acquired urban property  is significantly impacted by over 40 years of dry cleaning operations having utilized PCE. 

  • Representation of departing long-term tenant at an impacted truck stop facility. Negotiation of PA Act 2 Buyer-Seller Agreement with PADEP; Negotiation of three- party remediation agreement including the site owner and prospective purchaser.

  • Represented chemical manufacturer in negotiation of settlement with both PADEP and local sewer authority which would allow reissuance of necessary permits and resolution of  government response cost claims,   upon consummation of a pending acquisition of the business. 
  • Representation of community redevelopment non-profit in acquisition and remediation of contaminated industrial property, and seeking PA Act 2 approval allowing site redevelopment.                                                                                                                                        
  • Represented commercial property owner in seeking Pennsylvania Act 2 approval based on "Background Standard" for contaminated groundwater caused by historic operations at neighboring properties; Advised client own potential claims against current and former owner/operators of neighboring properties.  

UNDERGROUND STORAGE TANKS (USTs)

Sub-surface petroleum leakage from USTs is a common environmental issue—particularly for retail fuel facilities. Contaminated soils are usually at depths of 10-20 feet and have impacted groundwater with plumes of various product constituents such as MTBE and Benzene. There can also be third-party property damage claims from neighboring businesses and residents. Many facilities are currently owned and operated by small independent businesses who cannot afford the excessive costs. Thus, coverage by the state Underground Storage Tank Indemnity Fund (USTIF) may be crucial to financial survival. In Pennsylvania, the USTIF is known for taking every possible opportunity to deny or reduce coverage, as well as attempting to control the remedial decision making process. Environmental counsel can help navigate the program by assuring appropriate contractual arrangements with remedial contractors, and negotiation with USTIF for pre-approved remedial plans.  Counsel can also file appeals of coverage denial well as the frequently encountered short-pays on invoices submitted for reimbursement.   

 selected experience
  • Appeals of USTIF coverage denial based on timeliness of claim notification and proof of occurrence after 1994 jurisdictional date; Appeals of invoice short-pays because of alleged unreasonable costs; Negotiation of settlements allowing substantial payment for remediation;   

  • Representation of retail fuel company regarding release of MTBE to groundwater in residential area; negotiation with PADEP to allow phased investigation of leak source without shutting down the facility; negotiation with PA USTIF for full coverage and defense of homeowner suits.  

  • Represented owner of restaurant after the basement was inundated by gasoline from a tank leak from the nearby service station.  Negotiated safety, remedial, and compensation issues with DEP, insurance carrier, and local emergency responders.

REMEDIAL COST ALLOCATION DISPUTES

The cost of site investigation and remediation at an industrial or leaking fuel tank site can easily reach several hundred thousand dollars, and can escalate further if extensive groundwater monitoring or remediation are required.  Thus, resolution of site remediation issues often requires the efforts of Environmental counsel to secure cost reimbursement or “contribution” from other potentially liable parties such as prior owners and current or prior tenants.  Parties on the receiving end of such claims can likewise benefit from representation by Environmental counsel. Criteria for such “cost allocation” may include extent of causation or relative period of facility operation, relative economic benefit going forward, or interpretation of the terms of a prior lease or sale agreement.

For parties on both sides, the value-added by Environmental counsel is not just getting through tedious litigation with a favorable court verdict. It is often more about strategic advice and claim resolution  based on evaluating: 1) The legal costs necessary to complete pre-trial discovery and motions (and thereby reach the juncture where most parties are willing to settle); 2) The range of tolerable potential settlement options; and 3) Range and probability of outcome at a trial. In most cases, timely cost allocation settlements can provide important legal finality to all involved while minimizing legal costs and facilitating commencement of timely remediation.

 selected experience
  • Settlement of landlord/tenant dispute over costs incurred to address infiltration of contaminated groundwater from a neighboring property.  

  • Advice to long-term industrial tenants in performance of exit evaluation to determine contractual remedial obligations and liabilities. Cost allocation complicated by apparent historic impacts of previous tenants and owners, and limited availability of historic

  • Representation of estate holding title to an active auto service station found to have groundwater contamination; Cost allocation issues complicated by lengthy site operational history and attempts to sell the property to the current tenant/site operator..  

  • Represented buyer of former industrial property showing significant residual contamination in Phase II investigation. Negotiated pre-closing cost sharing agreement including previous owner responsible for site conditions.