Cleaning Up Contaminated Property in Texas
In the environmental context, remediation is an extensive process of cleaning up environmental contamination. Environmental remediation projects are some of the most challenging real estate development projects for a variety of reasons.
The remediation process must be tailored to the specific contamination and property. It also must take into consideration the intended future use of the contaminated property. Within several of these programs lurks the question “how clean is clean?”, and increasing standards of cleanliness dramatically escalate remediation costs.
The chosen remediation process often affects the contaminated property’s fair market value after the remediation. It may be necessary to balance the cost of the remediation with the effects on the property’s fair market value.
Mr. McPherson’s history in commercial real estate transactions uniquely qualifies him to help clients understand this relationship. He can help you strike the right balance for each situation.
At McPherson Law Firm PLLC, we can help you choose the right type of remediation and guide you through the process. Our attorneys can advance your best interests every step of the way. Reach out to our Texas law firm at (214) 722-7096 to get started today.
In Texas, remediation options include:
- The Voluntary Cleanup Program
- The Innocent Owner/Operator Program
- The Texas Risk Reduction Program
- The Municipal Setting Designation
- The Brownfields Site Assessment Programs
Here is a brief overview of each of these programs.
Voluntary Cleanup Program (VCP)
The Texas Legislature enacted the Texas VCP to provide incentives to encourage the cleanup of contaminated sites in Texas. Many unused or under-used properties may be restored to become economically productive and beneficial to the community.
The VCP protects all non-responsible parties involved in the cleanup or investment process from liability.
Sites are ineligible to enter the VCP if they are subject to:
- Response actions under RRC authority
- An order or permit from the Texas Commission of Environmental Quality (TCEQ)
- A pending TCEQ enforcement action
Parties entering the VCP must submit:
- An application
- An Affected Property Assessment Report describing the contaminated area of concern
- A $1,000 application fee
The VCP process usually takes many months to complete. However, it can raise the fair market value and eliminate land-use restrictions on a property.
The Texas IOP issues Innocent Owner/Operator Certificates (IOCs) to certain people when their property or businesses were contaminated.
The IOC verifies that:
- The release or migration of contaminants came from a source outside of the property
- The property owner or operator did not contribute to or cause the source of contamination
The IOP can be used to redevelop or add value to contaminated property. Unlike the VCP release of liability, however, IOCs are not transferable to future owners/operators. These future owners or operators must enter the IOP and receive their own IOC.
TRRP regulates the cleanup and management of wastes and substances (i.e. chemicals of concern), which are released into the environment from commercial and industrial facilities.
The TRRP process guides the closure and release of waste management facility components (e.g., tanks, container storage areas, surface impoundments). This process determines whether the processes will pose an unacceptable risk. If they do, it outlines what must be done to reduce the risk, prevent pollution, or protect natural resources. The TRRP can be a cost-effective way to rehabilitate properties and return them to productive use.
An MSD is an official state designation given to a property. It certifies that designated groundwater at the property can’t be used as potable drinking water because it is unacceptably contaminated. The prohibition is in the form of a city ordinance or an enforceable restrictive covenant.
An MSD can control the cost of a property cleanup. Essentially, it limits the need for investigations or costly response actions addressing groundwater contaminants. This is due to the fact that the water has already been declared unpotable.
In Texas, many former industrial properties lie dormant or underutilized due to actual or theoretical contamination and all associated liability issues. These properties are broadly referred to as “brownfields.”
The TCEQ facilitates cleanup, transfer, and revitalization of brownfields at no cost to local governments. It also provides technical advice, education, and project partnering for brownfields redevelopments. In response, some local governments have begun to offer property tax abatements to encourage cleanup and redevelopment.
Contact Us for Legal Assistance with a Contaminated Property
At McPherson Law Firm PLLC, we have years of experience navigating the unique legal differences between environmental remediation processes. We can assess your resources and goals to determine which path is best for you. We can then develop a strategy to protect you from liability issues and increase your likelihood of long-term profitability.