Repeal of ‘Transfer Act’ Would Shift Burden For Environmental Clean-ups in Connecticut

Legislators and policy makers are proposing to change the way that hazardous waste cleanup works in Connecticut — a shift that advocates hope will both boost the economy and better protect the environment.  

The changes are outlined in two bills that if approved by the legislature will switch over the state of Connecticut from a system that is transfer-based — in which the owner is responsible for cleaning up hazardous materials only when a property changes hands — to a release-based system, in which the cleanup must be done as soon as the owner becomes aware of the problem. 

This change would require the repeal of the Transfer Act, a piece of legislation initially developed in 1985, on the heels of a series of federal acts regulating hazardous waste cleanup. The act says that when a property is transferred from one owner to another, any hazardous waste has to be cleaned up in compliance with state regulations. 

According to the EPA, “hazardous waste” includes industrial chemicals, some pesticides, waste from manufacturing, metal production and finishing, petroleum refining and coke production. Under the Transfer Act, the two parties in a sale come to an agreement over who will be responsible for that clean-up. 

According to State Sen. Christine Cohen, chair of the legislature’s Committee on the Environment, and one of the legislators working on the new bills, the Transfer Act was intended as a means of forcing property owners to clean up hazardous materials so that they would not cause long-term damage to the environment. Instead, it has acted as an economic drain, causing people to refrain from selling properties and discouraging buyers who might find it easier to purchase property in a different state. 

The result, she said, is a large number of abandoned facilities, and spills that have never been cleaned up. According to Cohen, it’s also an issue of environmental justice because many of these abandoned facilities are located in disadvantaged communities. 

“[The Transfer Act] just never did what it was supposed to do,” said Cohen. 

In Connecticut, just 25 percent of the 4,200 properties falling under the Transfer Act have made it through the process of environmental clean-up. The rest are still under investigation, or awaiting a necessary regulatory change. Properties falling under the act include brownfields, buildings that house dry cleaners, vehicle repair shops, furniture strippers, and any other site that has manufactured or disposed of more than 100 kilograms of hazardous waste, including some warehouses or printers.

At a listening session on Thursday, Department of Energy and Environmental Protection Commissioner Katie Dykes and Department of Economic and Community Development Commissioner David Lehman said that the move to a release-based system could provide a much-needed boost to the economy. 

The Transfer Act applies to properties in 158 of Connecticut’s 169 towns, with Stamford, Waterbury, Bridgeport, Hartford, New Haven and Norwalk being the most affected areas. A 2019 report by the Connecticut Economic Resource Center found that property sales held up in the Transfer Act had resulted in the loss of 7,000 jobs and $178 million in tax revenue. 

Graham Stevens, chief of the Bureau of Water Protection and Land Reuse at DEEP, said that the act has been modified almost 20 times since it was adopted. 

The most recent modifications happened last year, when Gov. Ned Lamont signed PA 19-75. This act, which was partly in response to the issues raised in the 2019 report, extended a number of exceptions to the activities that fall under the act. It also truncated the amount of time that the state can spend investigating a property, from three years to one year, a compromise from a separate bill proposed in January of 2019 that would have reduced the period to 60 days.   

PA 19-75 also created a working group, made up of legislators, representatives from the business and real estate sector, and DEEP and DECD officials, to further modify certain provisions of the Transfer Act. These modifications, which limit the types of properties and activities that fall under the act, became Senate Bill 281. One key revision says that if a multi-occupant building houses a business that generates hazardous waste, only the particular unit of the building where the business was, rather than the entire building, has to be investigated. 

After the working group finished the proposed modifications to the Transfer Act in January, an offshoot of the original group of real estate owners, businessmen, and officials from DEEP and DECD quickly drew up a second bill, Senate bill 293, outlining the tenants of a release-based system.  

Cohen sees the release-based system as ultimately being much simpler. “You find a spill, you clean it,” she said. And at the listening session, Dykes said that a release-based system would allow DEEP to focus on cleaning up the most risky contamination.

Yet Eric Brown, the vice president of manufacturing and policy at Connecticut Business Industries Association, told CT Examiner that drawing up the regulations for a release-based system presented “a huge undertaking.” 

In order for the change to take place, he said, the state would have to assess hundreds of properties that currently fall under the Transfer Act and integrate them under new laws. Brown also said that it would require hiring new staff members who specialize in risk assessment. 

DEEP says their goal with the regulations is to create a “tiered” system, which will evaluate a site based on the level of contamination. Unlike with the transfer system, where the same requirements for clean-up apply to all properties, the tiered system will allow lower-risk properties to meet environmental obligations more quickly. 

Stevens also said that properties currently under review in the transfer-based system will be placed in a “safe harbor” so that they can complete their obligations under the Transfer Act.  

Environmental lawyers and business people at the information session expressed concern that the shift to the release-based system was “rushed.” Representatives from the Environmental Professionals of Connecticut said that standards needed to be created in order to determine how spills of various materials should be cleaned up. They also suggested convening another working group to discuss the necessary regulations. 

Elizabeth Barton, an environmental land use attorney with Day Pitney, said that DEEP would need to hire a consultant in order to evaluate the risk of certain properties. Others expressed concern that the new regulations would loosen some of the protections for the environment. Brown also pointed out that there were some inconsistencies in the proposed bills. 

Brown said the goal was to have the necessary regulations ready within two years. Until then, the Transfer Act will stay in place, with modifications. The committee members are hoping that the two bills will be passed in the September special session, which would give them an extra nine months to work out the regulations. 

Brown told CT Examiner that while he believes the task will be difficult. He also said that shifting to a release-based system needs to be a priority. 

“It’s doable, but we have to do it thoroughly and carefully,” he said.

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