Court Ruling Means Caution for Brownfield Developers

A recent ruling by a federal district court in Illinois means that persons who are redeveloping contaminated properties should be cautious in relying on assurances by State environmental regulators that no further environmental cleanup is necessary. In a case involving two developers owning adjacent properties, the court ruled that a State environmental agency “no further remediation required” (“NFR”) letter does not shield a property owner from a citizen suit under the federal Resource Conservation and Recovery Act (“RCRA”) for an imminent and substantial endangerment to health or the environment. The property owned by one of the developers formerly had a dry cleaner on it, and there was contamination from dry cleaning chemicals that had migrated to the adjacent property owned by a second developer. The second developer sued under RCRA seeking to require cleanup of the contamination on its property. The first developer argued that the NFR letter shielded it from liability. The court did not agree, and allowed the suit to proceed. Persons or entities who are interested in developing a contaminated property such as a former dry cleaner or gas station should carefully evaluate the strength of any applicable State brownfield redevelopment law to evaluate its risk in proceeding after receiving the required approvals from the State environmental agency. For more information, please contact Steve O’Day

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