The term Brownfields refers to lands often in urban or older suburban areas which, for reasons of real or perceived contamination, have remained abandoned or underused. This is because developers choose to build on comparatively pristine land elsewhere, often in less developed suburban or rural areas. Similarly, lenders and investors can be reluctant to finance projects that may involve the risk of environmental liability.

The source of their concern is the federal Superfund statute, which imposes strict, joint and several, and retroactive liability for hazardous substances in the environment, and the similar Massachusetts Superfund statute, G.L.c.21E.

We are attorneys for developers, businesses and present and future landowners, as well as local governments, who desire to encourage and facilitate the redevelopment of contaminated properties must familiarize themselves with these brownfields opportunities and obligations. Of special note are the several new financial incentives for the cleanup, redevelopment, and reuse of brownfields.

The idea is to create new commercial opportunities with economic, social and community benefits. We are very much committed to getting contaminated sites back to productive use.

The Massachusetts Brownfields Act was created in 1998 to attract such reluctant parties to undertake the remediation and redevelopment of contaminated sites, reducing development pressure on the relatively pristine Greenfields. The legislation limits liability for innocent parties who buy and clean up brownfields. The law provides financial incentives, including tax breaks, loans, and grants for cleanup activities. Tax credits of 25% of cleanup costs are available for sites with future Activity-an-Use Limitations (AULs), or tax credits up to 50% are available for sites that are cleaned up to the point that no AULs are required.

The state law creates a Redevelopment Access to Capital program containing $15 million for loans guaranteed to businesses or individuals that clean up brownfields sites. A Brownfields Redevelopment Fund will contain $30 million in grant money for economically distressed areas.

The law offers release from liability to adjacent property owners and provides protection to secure lenders, redevelopment authorities, and community development corporations. In so doing, it benefits municipalities, as well as many other types of property owners and operators, who did not cause or contribute to the contamination, such as innocent purchasers, tenants and downgradient property owners.

There are extensive cleanup requirements in the statute and various additional requirements imposed by the Massachusetts Department of Environmental Protection (DEP) which must be met to obtain the liability relief provided by the statute.

Parties who do not qualify for the statutory relief in the Brownfields Act still may apply to the Office of the Attorney General (OAG) for liability protection under the brownfields covenant-not-to-sue program. Secured lenders are protected from liability provided they did not cause or contribute to any action that caused the release of hazardous substances or oil.
Guidance and regulations have been promulgated by:

• Massachusetts Development Finance Agency (MDFA) for funding;
• Department of Revenue (DOR) for tax credits;
• OAG for covenants-not-to-sue, and
• DEP for AULs which are an important component of settling liability

For our clients we coordinate with community leaders, consultants, contractors, claimants, and insurers to reach consensus on liability protections, cost-sharing, permits needed, public participation, and overcoming the environmental challenges to redeveloping Brownfields.