If you are thinking about acquiring a brownfield site, you are probably concerned about liability. You don’t need to be a lawyer to know that limiting your liability is a good thing.
Does Strict Liability Apply for My Project? If a unit of state or local government acquired ownership or control involuntarily through bankruptcy, tax delinquency, or abandonment then liability does not apply. However, if you come to own the property voluntarily through a purchase or gift, you must follow the All Appropriate Inquiries (AAI) steps prior to acquisition, in order to maintain your federal liability defense.
All Appropriate Inquiries is the federal pre-acquisition due diligence process of evaluating a property’s environmental conditions. This consists of conducting a Phase 1 Environmental Assessment with the following requirements:
- Must be conducted within one year prior to date of acquisition; certain aspects must be updated within 180 days prior to acquisition.
- Must be performed by an “environmental professional”, see more information here.
- Specific activities are required, for a full list click here.
Continuing Obligations: Even after you have established your liability defense, once you acquire the property there are ongoing responsibilities to maintain this protection.
The good news is that following these steps will not only limit your liability but also maintain your eligibility for USEPA assessment and cleanup funding. Consult with legal counsel for other elements associated with maintaining a federal liability defense when acquiring contaminated property. Additional information can be found here.
