Real Property & Environmental Law Alert

Real Property & Environmental Law Alert

Transactional Real Estate, Development/Redevelopment & Environmental Law

Remedial Investigation Deadline Looms for New Jersey Contaminated Sites

Posted in Development/Redevelopment, Environmental & Green Issues

In less than three weeks, the statutory deadline to complete a site-wide remedial investigation (“RI”) for many contaminated sites in New Jersey will pass. Any site for which an RI has not been completed will be subject to direct oversight of the New Jersey Department of Environmental Protection (“NJDEP”), which would come with additional costs, less control over the remediation, and other burdens for responsible parties. Accordingly, responsible parties and their Licensed Site Remediation Professionals (“LSRPs”) should do everything in their power to complete an RI by the statutory deadline: May 7, 2016.

The May 7, 2016 deadline is the result of the New Jersey Site Remediation Reform Act (“SRRA”), which upended and revamped the process for remediating contaminated sites in New Jersey. Pursuant to SRRA, NJDEP no longer directly supervises the remediation process of every individual site. Instead, LSRPs licensed by the State are responsible for day-to-day oversight, regulatory compliance, and all necessary submissions to NJDEP related to clean-up efforts at most contaminated sites. However, responsible parties who fail to hire an LSRP or otherwise run afoul of the requirements of NJDEP’s site remediation regulations fall into “direct oversight.” The remediation of sites under direct oversight is managed directly by NJDEP and responsible parties lose the autonomy, flexibility, and cost savings that result from an LSRP-managed clean up.

At the time it was enacted, SRRA provided that sites requiring remediation related to discharge of hazardous substances pre-dating May 7, 1999 must complete a site-wide remedial investigation by May 7, 2014, or face direct oversight. That deadline was later extended by legislation to May 7, 2016 for responsible parties who filed for an extension. With that deadline rapidly approaching, NJDEP has indicated that no further extensions will be granted, and no additional legislation is expected.

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Proposed Definition of “Underutilized” for Brownfield Cleanup Act Amendments Draws Many Comments

Posted in Development/Redevelopment

Numerous organizations and individuals have submitted comments on the proposed definition of “underutilized” published by the New York State Department of Environmental Conservation (NYSDEC) on March 9, 2016, pursuant to the 2015 Brownfield Cleanup Act Amendments. The Amendments require NYSDEC to propose a definition for “underutilized,” one of the few remaining ways for New York City sites to qualify for tangible property tax credits under the State’s Brownfield Cleanup Program (BCP). As such, this definition is seen by many as crucial to the continued viability of the BCP as a cleanup mechanism for brownfield properties in New York City.

NYSDEC proposed a definition last June but withdrew its proposal after widespread public criticism. The new definition is an attempt to cure the deficiencies of the earlier proposal.

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NYSDEC Proposes New Definition of “Underutilized” for Tangible Property Tax Credits at New York City Brownfield Sites

Posted in Development/Redevelopment

On March 9, 2016, the New York State Department of Environmental Conservation (NYSDEC) proposed a new definition of an “underutilized” site for purposes of claiming tangible property tax credits for sites in New York City under the New York State Brownfield Cleanup Program (BCP).

As noted in prior blogs, the 2015 amendments to the BCP established new restrictions on the ability of sites in the five boroughs of New York City to obtain tax credits related to expenditures for site improvements. One of the criteria which would allow a site to qualify for such credits was that the site be “underutilized.” That term was left undefined by the Legislature, with instructions to NYSDEC to finalize a definition by October 1, 2015.

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“And/Or” – No More

Posted in Development/Redevelopment, Environmental & Green Issues

The use of “and/or” in drafting or, for that matter, anything other than the most casual communications, is one of our pet peeves. It is a substitute for careful drafting and an invitation to ambiguity.

Ken Adams, in his Manual of Style for Contract Drafting – which we highly recommend to any serious drafter – devotes two pages to using, or perhaps, better said, mis-using, “and/or.” Mr. Adams observes that since the mid-20th century, judges and legal-writing commentators have railed against the use of “and/or” to convey the meaning of the inclusive “or.” He makes the following points:

  • it is often used when the only possible meaning is that conveyed by “or.” For example, “Acme shall incorporate the Subsidiary in Delaware and/or New York.”
  • it is confusing to use “and/or” in language of obligation or prohibition. Instead of “Acme shall purchase Widget A and/or Widget B”, say “Acme shall purchase Widget A or Widget B, and may purchase both.”
  • if “and/or” is used to list more than two items, it is unclear if the “or” is inclusive or exclusive. In other words, A, B, and/or C could mean either one or all of A, B, and C, or one or more of A, B, and C.

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Howard Geneslaw and Jason Tuvel to Speak at the 2016 Land Use Update

Posted in Development/Redevelopment

Howard D. Geneslaw, a Director in the firm’s Real Property & Environmental Department and Vice Chair of the Land Use Section of the New Jersey State Bar Association, will be participating, both as a moderator and speaker, at the upcoming 2016 Land Use Update on Wednesday, February 24, 2016 in West Orange, New Jersey. Jason R. Tuvel, also a Director in the firm’s Real Property & Environmental Department and a Director of the Land Use Section, will be speaking when the same program is presented next month on March 16, 2016 in Mount Laurel, New Jersey.

Mr. Geneslaw has served on the Board of Directors of the Land Use Section since 2009. His law practice focuses on real estate development, redevelopment and related issues, including litigation, as well as on alcoholic beverage and liquor licensing matters in New Jersey, New York, and Connecticut. He is a licensed Professional Planner in New Jersey and a member of the American Institute of Certified Planners (AICP). Mr. Geneslaw will be moderating the entire program, as well as leading the panel discussion on ethics. He will also speak about a recent case on variances.

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NJ High Court Clarifies Standard for Revocation of Direct Access to State Highway from Commercial Property

Posted in Development/Redevelopment

In its recent decision in In Re Revocation of the Access of Block #613, the New Jersey Supreme Court clarified the standard governing the revocation of direct access from a State highway to a property used for commercial purposes under the State Highway Access Management Act and the State Highway Access Management Code. The case outlines the requisite procedure for revocation of a commercial property’s direct access to a State highway by the New Jersey Department of Transportation (NJDOT).

NJDOT sought to widen Route 166 in Toms River in an effort to increase safety, traffic capacity, and movement on the roadway. Arielle Realty, LLC, a commercial tenant, conducted business on a property at the corner of Route 166 and West Gateway that had direct access to both streets. Arielle Realty objected to the road widening project because it would essentially eliminate its commercial property’s direct access to the State highway, in addition to eliminating eight of the property’s parking spaces located in an existing NJDOT right-of-way.

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Gibbons Director David Freeman Featured in The New York Environmental Lawyer

Posted in Environmental & Green Issues

David J. Freeman, a Director in the Gibbons Real Property & Environmental Department, was recently profiled in the Fall/Winter 2015 edition of The New York Environmental Lawyer for his achievements as a longstanding member of the Environmental Law Section of the New York State Bar Association.

A member of the Section for more than 30 years, Mr. Freeman serves as Co-Chair of both the Committee on Hazardous Waste/Site Remediation and the Section’s Brownfields Task Force. The Task Force played an important role in the passage of the State’s Brownfield Cleanup Act in 2003 and the amendments enacted in 2008 and 2015, and in monitoring and commenting on the implementation of the Act by the Department of Environmental Conservation. Mr. Freeman received the Section’s Distinguished Service Award in 2001.

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No Further Extensions of New Jersey’s Permit Extension Act

Posted in Development/Redevelopment

The state legislature took no action to further extend New Jersey’s Permit Extension Act (“PEA”) during the recently concluded legislative session, which means that permits and approvals extended by the PEA’s tolling period either have expired or will expire soon. Pursuant to the terms of the act, the expiration date for most approvals covered by the PEA are tolled through June 30, 2016, with certain approvals expiring before that date, making right now the time to evaluate projects approaching construction to determine which existing approvals were extended by the PEA, the exact expiration date of such approvals, and whether further extensions are available under other laws. After such an evaluation, developers and project managers can then determine whether approval rights can be fully vested prior to their expiration date and, if not, whether an extension, amendment, or renewal of the approval is required.

The PEA was initially enacted in 2008 in response to “the crisis in the real estate finance sector of the economy.” The purpose of the PEA was to toll the expiration of various approvals necessary for development through 2012. The PEA was later amended in 2012 and again in 2014, due to the then “current national recession,” extending the tolling of those approvals until December 31, 2015. The PEA provides for the tolling of any “approval,” as defined in the statute, which is or was in existence during the extension period (January 1, 2007 through December 31, 2015). Most subdivision, site plan, and variance approvals granted pursuant to the Municipal Land Use Law are encompassed within covered “approvals,” as are many approvals granted by the New Jersey Department of Environmental Protection (NJDEP), New Jersey Meadowlands Commission (NJMC), New Jersey Pinelands Commission, and various other state agencies. Caution, however: there are important exceptions to the general rule above, and some permits and approvals are expressly excluded from the tolling which the PEA provides. Continue Reading

Supreme Court Will Decide Whether State Can Face Liability Under Spill Act

Posted in Environmental & Green Issues

The New Jersey Supreme Court has decided to hear the State’s appeal of a September 2015 Appellate Division decision that held the State potentially liable for cleanup costs at the Raritan Bay Slag Site.

As we reported last fall, the Appellate Division held in NL Industries, Inc. v. State of New Jersey that the Spill Compensation and Control Act, which imposes liability upon both dischargers of hazardous substances and on parties “in any way responsible” for the hazardous substances, is applicable to the State. Under the Appellate Division’s ruling, the State could bear liability for all or some of the cleanup costs related to a seawall that was constructed using contaminated materials. The suit alleges that the State should be held liable because it owned the land under the seawall, approved its construction, issued a riparian grant to the developer that sought to build it, and issued a permit for it.

The Supreme Court granted the state leave to appeal on January 15, 2016.

Paul M. Hauge is Counsel in the Gibbons Real Property & Environmental Department.

Settlement Update on New Jersey Tax Court’s Closely-Watched AHS Hospital Decision

Posted in Development/Redevelopment

Several months ago, this blog reported on Judge Vito Bianco’s denial of Morristown Memorial Hospital’s (the “Hospital”) property tax appeal. While this was only a Tax Court decision, it was closely-watched because it had the potential to eviscerate the property tax exemption for modern integrated hospitals, and potentially for other nonprofit organizations with complicated corporate structures or relationships.

On November 11, it was reported that the Hospital entered into a global settlement with the town of Morristown, pertaining to a dispute over the Hospital’s property tax bill from 2006-2015. Under the agreement, the Atlantic Health System (“Atlantic Health”), owners of the Hospital, agreed to pay the town of Morristown $15.5 million dollars — including an upfront payment of $10 million — over the next 10 years. While Judge Bianco’s decision held that nearly the entire Hospital property was taxable, save for the limited exceptions of a visitor parking garage, fitness center, and auditorium located on site, under the settlement agreement, Atlantic Health will begin making annual tax payments on only approximately 25% of the Hospital’s property.

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