Society of Texas Environmental Professionals April 25, 2014 Fort Worth, Texas REGULATORY TOOLS: VCP, DCRP, IOP, MSD and BROWNFIELDS. Dick Record, P.G.
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1 Society of Texas Environmental Professionals April 25, 2014 Fort Worth, Texas REGULATORY TOOLS: VCP, DCRP, IOP, MSD and BROWNFIELDS Dick Record, P.G. Cirrus Associates, L.L.C. Dallas/Houston
2 Agencies that provide useful regulatory tools: Texas Commission on Environmental Quality (TCEQ) Texas Railroad Commission (RRC)
3 The TCEQ oversees subsurface cleanup issues unless they are related to oil and gas exploration, production and transportation, which are covered by the Railroad Commission.
4 Types of Tools Available: Voluntary Cleanup Program (VCP) TCEQ and RRC Dry Cleaner Remediation Program (DCRP) - TCEQ Innocent Owner/Operator Program (IOP) TCEQ only Brownfields Grants TCEQ and RRC Municipal Setting Designation (MSD) TCEQ
5 Comic Relief (for 12 year olds)
6
7 TCEQ s VCP Primary benefit: Limits the liability of a purchaser of environmentally impacted property through a waiver from the TCEQ. - VCP is part of the Remediation Division s Corrective Action Section
8 TCEQ s Dry Cleaner Remediation Program (DCRP) Primary benefit Provides for state-funded evaluation of dry cleaning sites with soil/groundwater impacts after a $5,000 deductible is met and all past landowner and dry cleaner fees plus penalties are paid. Strong liability protections are also afforded the applicant. Your friendly environmental attorney can provide liability waiver details! The above statement regarding liability protections in no way is indicative of a Professional Geologist providing legal services in the State of Texas under applicable laws, regulations, statutes, guidance, general thoughts, or in any other manner.
9 TCEQ s IOP Primary benefit: Provides a liability waiver through regulatory concurrence that environmental impacts on your property were not caused by the operations on your property.
10 TCEQ s Brownfields Primary benefit: Provides tax benefits and grants to municipalities and nonprofit organizations to help facilitate redevelopment of environmentally impacted property.
11 TCEQ s Municipal Setting Designation (MSD) An MSD is not a program, but is a tool you use in Corrective Action or in Corrective Action s VCP. It is a law that eliminates the groundwater ingestion pathway and soil protection of that pathway after a City passes an ordinance restricting the use of groundwater, which the TCEQ then certifies through review of a TCEQ MSD application. The main effect of the MSD is removing the groundwater ingestion pathway thereby greatly increasing the site s critical PCL in the soil and groundwater.
12 Note The RRC does not officially recognize MSDs, but would use a city s restrictive ordinance against groundwater use.
13
14 TCEQ VOLUNTARY CLEANUP PROGRAM - VCP
15 VCP Statistics 2,530 sites 1,922 COCs or CCOCs
16 Key VCP Points Liability waiver from State actions for a purchaser of the property, not the current owner, and COC is transferrable. Purchaser should be placed on the VCP application prior to closing the transaction or they are not eligible for the liability waiver.
17 You must not initiate remediation prior to filing your application except in limited cases (unless conducted prior to April 19, 1996). Odd Side Note Staff (some) in the VCP are checking the backs of signature pages to see if they can feel pen marks where the paper was indented to see if they are original signatures.strange but true!
18 Two Types of Certificates: COC Final certificate with no further action required CCOC is a conditional certificate that allows a final certificate to be issued after certain conditions are met such as continued monitoring or it may always be conditional if an engineering control must remain.
19 A COC or CCOC provides a TCEQ sign-off on all contaminants on-site, so investigation requirements are higher. A site may be sub-divided into different sections with each section closed at different times and under different standards. Example American Airlines Center in Dallas which was separated into 30 different Partial Response Action Areas (PRAAs)
20 Old Landfill Wastewater Plant Power Plant Old RR Roundhouse (locomotive maintenance Rail Lines
21 PRAA s at American Airlines Center I A 2B 24 1B 1A 6 5A 23 3A A/1C
22 American Airlines Center Offices/Hotels/Condos/Retail Katy Trail (former Rail Line)
23 PRAA Soil or Groundwater
24
25 TCEQ INNOCENT OWNER/OPERATOR PROGRAM - IOP
26 IOP Statistics 918 applications 840 certificates issued
27 Key IOP Points COC provides a current owner immunity from the State from impacts to property from offsite but is not transferrable to a new owner. COC covers a particular contaminant or set of contaminants specified by the applicant. It is possible to get a COC if your property uses same chemical as that migrating on-site, but this typically requires extensive investigation or getting a COC for part of a site.
28 Ownership criteria: Property can t have been acquired from the owner of the source property unless... - It was purchased from the owner of the source property after September 1, 1997 (effective date of IOP law), then... - The applicant must demonstrate that he did not know or have reason to know of the contamination at the time the property was acquired.
29 TCEQ typically wants data within the past year, particularly in the case of groundwater
30
31 TCEQ Dry Cleaner Remediation Program
32 DCRP Statistics Started in applications accepted (03/2014) 53 Closures 94 active from remediation to assessment 150 sites are inactive
33 Key DCRP Points The DCRP controls the timing of when and what actions are taken on-site. Significant closures to date but 150 sites are inactive. The DCRP is committed to control risks associated with a site, but not necessarily taking all actions necessary for closure. An owner can complete remediation actions while the site is in the DCRP to facilitate closure. As policy, the DCRP will not utilize an MSD. It is possible to transfer to the VCP, but you may have costs for remediation to reimburse to the DCRP.
34 TCEQ BROWNFIELDS
35 Key Brownfields Points Brownfield Site Assessment (BSA) Program Grants are available for public entities and non-profit organizations for assessment and remediation. Property must meet definition of a Brownfields per the Small Business Liability Relief and Brownfields Revitalization Act.
36 Applicant must not be a potentially responsible party under CERCLA. Assessments are performed by a State contractor
37 MSD Key Points Primary benefits are less delineation and likely no groundwater monitoring since the GW GW ING PCL no longer applies. Those cost savings typically pay for the MSD. Widely divergent city requirements ranging from no program, to a program that takes 30 days to get an ordinance in support of the MSD, to a program which likely will take 6 months to 1 year to get a city ordinance. Standard TCEQ application for all MSDs
38 Threat of MSD to Achieve Closure
39
40 Case Study
41 A dry cleaners has a release into Class 2 groundwater with concentrations of 10 mg/kg in the soil and 4 mg/l PCE. The plume appears likely to be stable since the cleaners has been gone for 10 years. The owner is trying to sell and needs a closure from the TCEQ within a three year window as part of their transaction and is interested in a liability waiver. What are their best options? Does that change with a desire to have a liability waiver?
42 Case Study
43 One Possible Answer With a liability waiver as an important factor, the Site can be taken into the VCP and concurrently take the site through the MSD process. The eventual VCP COC provides the liability waiver to the buyer. The MSD raises the applicable groundwater and soil PCLs high enough that no remediation of the soil or groundwater or groundwater monitoring would be required. Assuming no ecological or vapor issues, the Site can be closed within the desired timeframe.
44
45 RRC VOLUNTARY CLEANUP PROGRAM (VCP)
46 RRC VCP Statistics Program started June Sites accepted into the program 53 certificates have been issued to date
47 Key RRC VCP Points A person who is responsible for the contamination is not eligible to enter the property into the program. COC provides a liability waiver for the applicant and subsequent innocent owner.
48 If applicant is not the surface owner, written authorization of all surface owners of the property is required to be in the program. There is a $1,000 application fee and $1,500 surcharge that pays for staff time to review project reports, etc.
49 RRC Brownfields There are 28 properties in the Brownfield Response Program (10/13) The program operates very similarly to the TCEQ Brownfield program with respect to eligibility and funding.
50 MSD Conclusions The TCEQ and RRC provide a mix of liability waivers and tax benefits to facilitate real estate transactions as summarized by the tools listed below: TCEQ RRC VCP DCRP VCP Brownfields IOP Brownfields
51 Utilization of these tools and others such as engineering controls, Tier 3 risk assessments, deed restrictions provide powerful means to achieve the desired end of a completed closure in selling or buying real estate with real or perceived environmental liabilities.
52
53
54 Dick Record, P.G. President Cirrus Associates Richardson, TX/ Houston, TX
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