Environmental Law: The Diminishing Allure Of ELURs
As of October 1, 2013, Connecticut property owners have another tool in the contamination remediation toolbox. Public Act No. 13-308 revised the statutory provisions governing Environmental Land Use Restrictions (ELURs), which were first created in 1994. The act also created a new category of land use restriction known as a Notice of Activity and Use Limitation (NAUL). Like an ELUR, a NAUL is designed to provide long-term restrictions on the use of all or a portion of a property with residual contamination. NAULs are an additional means whereby human health and the environment are protected, while economic redevelopment of properties is facilitated and promoted. The Commissioner of Energy and Environmental Protection describes the NAUL as "an additional faster, flexible, and cheaper tool for cleanup" and "a self-implementing … optional legal control on future uses of certain low risk sites where pollution will be left in place." But there are still practical considerations as well as areas in need of further clarification.
Connecticut's Remediation Standard Regulations (RSRs) provide for the remediation of soil and groundwater to levels that are protective of human health and the environment. Under certain circumstances, where these standards cannot be met, the RSRs allow for the use of an ELUR as an alternative mechanism to achieve compliance. ELURs are easements granted to the Commissioner of Energy and Environmental Protection and are generally viewed as providing a less costly and more practical alternative. A frequent refrain by both regulated and regulator is that the ELUR process is inefficient, burdensome and time consuming.
Public Act No. 13-308 authorizes the Connecticut Department of Energy and Environmental Protection (DEEP) to make available a different, or at least additional, type of institutional control. The act begins with a redefinition of "environmental use restrictions" to now include both ELURs and NAULs. Unlike ELURs, NAULs are characterized as "self-implementing." The legislation provides for approval by a licensed environmental professional, even where the remediation is not being performed voluntarily. The stated goal is the processing and approval of the NAUL more expeditiously than the ELUR. At present, NAULs will be available only under limited circumstances. These are:
• To achieve compliance with the RSRs' industrial commercial direct exposure criteria, groundwater volatilization criteria and soil vapor criteria by restricting residential use of the property, if the property is zoned as industrial or commercial.
• To restrict the disturbance of inaccessible polluted soils or an engineered control that eliminates exposure to polluted soils, if these soils exceed only the RSR's direct exposure criteria by 10 times or less.
• To restrict demolition of a building or other permanent structure, which is isolating polluted soils, if these isolated soils either exceed only the RSRs' direct exposure criteria by 10 times or less or, where the volume of these isolated soils is 10 cubic yards or less, exceed the RSRs' direct exposure criteria by more than 10 times and the pollutant mobility criteria.
In testimony before the legislature's Environment Committee, the Environmental Professionals' Organization of Connecticut (EPOC) stated that the pollutant concentration threshold for semi-volatile organic compounds in soils eligible for a NAUL was too low. EPOC noted that this type of pollutant is frequently found in amounts exceeding this threshold because of normal vehicle traffic, stormwater runoff and similar common activity. EPOC also commented that the 10 cubic yard cutoff for isolated soils was likewise too low and not justified by any benefit to human health or the environment.
There has been considerable frustration during the ELUR approval process because of the requirement that, except when there is a waiver granted by DEEP, the property owner must obtain irrevocable subordination agreements from anyone holding an interest in the property to which the ELUR will apply. "Interest in the land" is broadly defined, encompassing mortgages, leases, liens, easements (including utility easements), and encumbrances.
During the NAUL process, instead of seeking subordination waivers from the DEEP, the property owner, pending final approval of the NAUL, makes the determination as to whether or not the prior interest in the land will interfere with the conditions or purposes of the NAUL. Where the property owner concludes there will be interference with the conditions or purposes of the NAUL, the property owner must secure a subordination agreement. At least 60 days prior to recording a NAUL, the property owner is required to notify all holders of interest in all or any part of the property. The holder of the interest in the land may waive this notice period.