New Brownfields Law Falls Short Of Sought After Superfund Reforms

"We supported the legislation as a first step," she said. "The system still needs comprehensive reform. The brownfields bill does not deal with the underlying issue."

The legislation, called the Small Business Liability Relief and Brownfields Revitalization Act, is aimed at taking certain small contributors to Superfund sites out of the liability system. It also strives to create incentives for developers to purchase and restore abandoned urban sites known as "brownfields."

The small-business portion of the legislation largely exempts from liability those potentially responsible parties that contributed 110 gallons or less of liquid material, or 200 pounds or less of solid material, to a Superfund site.

Regarding brownfields, the legislation frees from liability certain bona fide prospective purchasers of a site.

It also establishes a defense to liability for those who purchase property not listed as a Superfund site but later found to contain pollution.

This defense provides that the property buyer will be deemed to have conducted an appropriate inquiry if he or she performed a facility inspection and title search that revealed no basis for further investigation.

Finally, the legislation establishes grants to states to establish and enhance response programs.

Ms. Sherno said that while the Alliance supported the legislation, it is unfair to exempt new owners of brownfield sites from liability while denying the exemption to previous owners.

Maintaining Superfund's strict, retroactive joint and several liability system for these owners remains a huge roadblock to brownfields redevelopment that Congress should address, she said.

Ms. Gackenbach said, however, that the legislation is still a positive step. Specifically for insurers, she said, the grant program established by the legislation allows response contractors to use a portion of their grants to purchase insurance.

This is important, she said, since many contractors, even with the liability protection, were reluctant to engage in cleanups without insurance.

Moreover, she said, the legislation has symbolic importance in that it demonstrates a direction for future reforms.

But Ms. Gackenbach acknowledged that comprehensive reform would be an uphill battle and would not happen any time soon.

The brownfields legislation, she noted, took eight years and a multitude of hearings to enact.

Moreover, she agreed with those who say that comprehensive Superfund reform is no longer seen as a realistic legislative priority.

Indeed, Ms. Gackenbach said, the current estimate is that 60 percent of Superfund sites will be cleaned by the end of 2003.

Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, March 25, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.