Recently, the City of Newark (the “City”) approved Ordinance No. 16-0803, a/k/a the Environmental Justice and Cumulative Impacts Ordinance, (the “Ordinance”), which may significantly impact the process for seeking development approvals from the City. The Ordinance purports to advance the policy of promoting environmental justice, environmental stewardship, and sustainable economic development in the City. More specifically, the Ordinance seeks to mitigate the disproportionate impact of pollution and environmental degradation on the health of minority and socioeconomically disadvantaged communities, otherwise known as “environmental injustice.” As the Ordinance notes, the prevalence of environmentally overburdened, underserved, and economically distressed communities near industrial centers and other areas afflicted by poor environmental quality is well documented.
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 Proposes New Definition of “Underutilized” for Tangible Property Tax Credits at New York City Brownfield Sites
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.
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.
On July 29, 2015, the New York State Department of Environmental Conservation (NYSDEC) conducted a public hearing on its proposed definition of an “underutilized” site for purposes of the 2015 Brownfield Cleanup Act Amendments. As indicated in a prior blog, this definition is critical because being “underutilized” is one of the few ways that a New York City brownfield site can qualify for tangible property credits under the 2015 Amendments.
After a number of failed attempts over the past several years, the New York State Legislature and Gov. Andrew Cuomo reached agreement as part of the 2015-16 state budget on sweeping amendments to the New York State Brownfield Cleanup Program (BCP). This achievement is significant in light of the scheduled expiration of tax credits under the program on December 31, 2015. The attached article published by Bloomberg BNA, reprinted with permission, and co-authored by David J. Freeman, reviews the key elements of the amended statute, evaluates their significance and identifies some of the important unresolved issues that will need to be addressed in implementing the new law.
New York State Governor and Legislature Reach Agreement on Reform and Extension of Brownfield Cleanup Program
Governor Andrew Cuomo and leaders of the New York State Senate and Assembly have reached an agreement with respect to extension and reform of the State’s Brownfield Cleanup Program (BCP), a significant development in view of impending expiration of tax credit eligibility on December 31, 2015. The essential elements of the deal are as follows: All sites currently in the Program, and those which are admitted prior to December 31, 2022, will be eligible for tax credits if they obtain their Certificates of Completion (COCs) by March 31, 2026.
In his budget proposal unveiled on January 21, Governor Andrew Cuomo included recommendations that would significantly change the New York State Brownfield Cleanup Program. Among the revisions he has recommended to the Legislature are the following: The deadline for sites to obtain their Certificates of Completion (COCs) in order to be eligible for tax credits under the Program would be extended until December 31, 2025. However, sites currently in the Program will need to obtain their COCs by December 31, 2017 to qualify for the existing level of tax credits. For sites admitted to the Program after April 2015, tangible property (development) credits would be available only for sites in environmental zones, sites where the projected cost of cleanup exceeds the value of the property as clean, or sites containing affordable housing. For sites meeting these criteria, tax credits would potentially be increased from current levels. However, sites not meeting these criteria would be ineligible for any type of development-related tax credit.
New York State Brownfield Developments: Governor Cuomo Vetoes Tax Credit Extension; State Bar Recommends Reforms
On December 29, Governor Andrew Cuomo vetoed a bill that would have extended, until March 31, 2017, the deadline for sites in the New York State Brownfield Cleanup Program to finish cleanups in order to qualify for the Program’s tax credits. The current deadline is December 31, 2015. The veto surprised many observers, since the Governor had earlier indicated that he would sign the bill.
David J. Freeman to Chair Panel on Brownfield Reform at New York State Bar Association Environmental Law Section Fall Meeting
David J. Freeman, a Director at Gibbons P.C., will chair a panel on reform of New York State’s Brownfield Cleanup Program at the Fall Meeting of the Environmental Law Section of the New York State Bar Association. The panel will discuss the Governor’s and Legislature’s actions this year―passage of an extension of the tax credit aspects of the Program, without enacting underlying reforms―and what is likely to happen next year. It will feature such prominent experts as Edward McTiernan, General Counsel of the New York State Department of Environmental Conservation; Christopher Goeken, Director of Public Policy and Governmental Relations of the New York League of Conservation Voters; Darren Suarez, Director of Governmental Affairs of the New York State Business Counsel; Jody Kass, Executive Director of New Partners for Community Revitalization; Philip Bousquet, Partner at Bousquet Holstein; and Linda Shaw, Partner at Knauf Shaw.