As Legislators Debate Economic Benefits, and Burden for Homeowners, New Environmental Cleanup Rules Receive Unanimous Vote

HARTFORD — During special session, a number of state senators debated legislation that would modify the Transfer Act, a law dating to 1985 that regulates the way that polluted properties are handled in Connecticut. 

The legislation shifts state law from a “transfer-based” system — one that requires hazardous waste spills to be cleaned up when a property changes hands — to a “released-based system,” requiring that property owners clean up pollution as soon as they are aware of the problem.

The new legislation passed the House on Wednesday by a vote of 143-0 with an amendment which would prevent peripheral members of a limited liability corporation from being held liable for an infraction. The legislation would eventually pass the Senate 35-0 — but lawmakers continued to disagree about whether in its current form the expected economic benefits of the legislation were overshadowing substantial new risks for homeowners.

According to proponents of the new legislation, the Transfer Act discouraged investment and led many property owners to abandon rather than clean up polluted properties.

State Sen. Joan Hartley, D-Waterbury, who is co-chair of the Commerce Committee, said that just a quarter of the roughly 4,200 properties falling under the Transfer Act had been cleaned up. 

State Rep. Caroline Simmons, D-Stamford, who introduced the bill in the House on Wednesday, cited a study by the Connecticut Economic Resource Center, since renamed AdvanceCT, which concluded that if the properties held up in the Transfer Act had been released in 2019, they had the potential to generate over 20,000 jobs and $178 million dollars in tax revenue. 

The Senate debate, however, raised concerns that while the change would benefit commercial properties, it could raise risks for residential real estate.

State Sen. Craig Miner, R-Litchfield, ranking member on the Environment Committee, warned that the shift to a release-based system would make residential owners — as well as commercial owners — responsible for cleaning up pollution.

“What this bill does, for the very first time publicly,” said Miner, “is expand the conversation to things that people would not have assumed to be ‘dirty.’” 

Most people buy a house without knowing there is pollution, said Miner, who expressed concern that residential owners would be held responsible for spills that happened sometime in the past, but which they would now have to clean up.

“The cost associated with cleaning up spills is probably, in most cases, more than a new septic system. Probably more than an addition on a house,” he said. 

According to State Sen. Christine Cohen, D-Guilford, however, the regulations currently being considered by the Department of Energy and Environmental Protection would only hold property owners responsible for spills greater than five gallons which cannot be cleaned up within an hour. Cohen, who chairs the Environmental Committee, said this was something that would rarely occur in a residential context.

The immediate effect of the bill would be to change the requirements so that owners of multi-unit properties where one unit is considered an “establishment” — for example a strip mall housing a dry cleaner — are required only to investigate that unit, rather than the entire property. That change is intended to save time and money for owners looking to sell or buy a property.

Sites or “establishments” falling under the act include not only dry cleaners, but vehicle repair shops, furniture strippers, and sites where more than 100 kilograms of hazardous material — including industrial chemicals, some pesticides, waste from manufacturing, metal production and finishing, petroleum refining and coke production — has been manufactured or disposed of.

Cohen said that the new release-based rules would not go into effect until the regulations are drawn up by a working group that includes representatives from DEEP, the Department of Economic and Community Development, legislators and other stakeholders, including environmental transaction attorneys, as well as representatives from manufacturing and realtors. 

In comments to CT Examiner, Miner said that while he was in favor of the legislation, he believed that the bill would have benefitted from further discussion and public deliberation during regular session in January.

Cohen, on the other hand, said that it was important that the bill be passed now, that COVID-19 had exhausted the state finances, and that the shift to a release-based system was “a way for us to provide true economic impact and development right now.” 

In the debate in the Senate, Hartley underscored that point.

“We’re back in the game with this,” said Hartley. “We can compete with 48 other states.” 

Neglected properties could be turned into residential or commercial developments, or even public parks, said Hartley, “the possibilities are endless and exciting.” 

But State Sen. Len Fasano, R-North Haven, urged caution as the regulations are written, lest the new law “put us, maybe not in a commercial problem, but in a residential problem.”

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