Brown Ales and Brownfields

You’ve located the perfect spot for your new or expanded brew and tasting location. You’ve identified and contracted with a suitable consultant and requested that they perform a Phase I Environmental Site Assessment. The Phase I report is issued and you learn that your ideal location is impacted by prior uses at the site. Deep breath—your deal is not dead.

There are a number of available options to address a contaminated site, and the best option for a particular site is dependent on a variety of factors. For purposes of today’s blog I’d like to set the table for the new New York State Brownfield Cleanup Program—BCP-EZ program. The Brownfield Cleanup Program (“BCP”) is a comprehensive investigation, cleanup and redevelopment/reuse program that provides incentives in the form of technical oversight, tax credits and liability relief for eligible developers to complete cleanup projects. Unfortunately, the process of completing a cleanup to the point where the tax credits and liability relief are available was often costly and always time-consuming. A revamp of the 10-year-old Brownfield Cleanup Program occurred this summer in an effort to address a number of concerns. The amendments were established in law on July 1, 2015; one off-shoot was the BCP-EZ program.

Specific details on the BCP-EZ program are not yet available. Regulations are anticipated in early 2016 with implementation of the program in the summer of 2016. However, the BCP-EZ program is expected to essentially trade the tax credit incentive offered under the full BCP for the numerous public comment periods to allow for a streamlined cleanup process with little time lost in administrative or bureaucratic delays. Upon completion of a cleanup, liability relief in the form of a Certificate of Completion and a Covenant Not to Sue would be issued by the state. For those familiar with the former New York Voluntary Cleanup Program, which was ultimately replaced by the BCP, the BCP-EZ program is predicted to more closely resemble that process.

The value of the proposed BCP-EZ program lies both in the project speed of the process and the ability to obtain liability relief. The liability relief offered under the BCP-EZ program is critical for more than just peace of mind. For any contaminated property seeking funding, a sign-off and covenant not to sue issued by the state would likely be a requirement for any savvy investor and necessary to receive financing from any lending institution.

Please keep the BCP-EZ and other aspects of the BCP in mind as you shop for your ideal location. This blog will be updated as the details of the BCP-EZ pare fleshed out by the development and promulgation of new regulations. Until next time . . .



Jesse Hiney