DEP Streamlines Process for Implementing Restrictive Covenants Required for Cleanup Closure With Conditions

by Carlton Fields

[author: Laurel Lockett]
In June 2012, the DEP released a new revision to its Institution Controls Guidance Procedures document, which substantially streamlines the approval process associated with implementation of restrictive covenants required to be recorded before a Site Rehabilitation Completion Order (SRCO) is issued by the DEP for a contaminated site that is closed "with conditions" (such implementation of a cap, restriction on use of groundwater or future residential use) under the DEP’s various risk-based corrective action rules. The revisions will substantially reduce the time and expense involved by eliminating, except in limited circumstances, the need for a property owner to obtain third party written approvals (primarily from lenders and easement holders) of a restrictive covenant (RC) before the DEP issues the SRCO. The revisions were the result of a collaborative effort between the DEP and the Florida Brownfield Association (FBA) to improve the process for completing cleanup at brownfields and other sites closed using risk-based corrective action.

Under prior policy, the Department required a lender holding a mortgage on a property to be closed with conditions to execute a recordable subordination of the mortgage, confirming that the lender would not wipe out the RC in foreclosure in the event that the owner defaulted. However, practical experience during the recent economic downturn has shown it to be very unlikely that a lender would ever choose to extinguish a RC through foreclosure — an action that would render the property out of compliance, subject to rescission of the SRCO, and unmarketable — particularly when the lender could proceed with foreclosure, leaving the RC in place, or simply sell the note, mortgage and pending foreclosure action to a third party.

Similarly, with recorded easements, the DEP historically required a recordable consent and joinder from the holders of recorded easements, confirming their agreement to comply with the terms of the RC. This has proved extremely difficult, expensive and time-consuming to obtain — requiring formal action by local governments that held platted or other utility easement rights, and prolonged attempts to contact and coordinate with private utilities not equipped to handle such requests.

Under the new guidance, rather than obtain a recordable subordination or consent and joinder, the owner must now provide written notice to the party of the intent to enter into the RC with the DEP, and provide proof of that notice to the Department. This notice can be provided on or after the time the owner publishes notice of the Department’s intent to enter in the RC in the local newspaper — a requirement under existing policy. The form of the notice to the lender or easement holder is similar to the form of notice the owner is required to publish.

There remain very limited and well-defined situations where a lender or easement holder still will be required to execute a recordable subordination of mortgage or consent and joinder. For a lender, those are limited to situations where site closure is dependent on an engineering control with an active control system that involves a substantial recurring expense or where the failure to maintain the control system could result in an imminent hazard (within a few days or weeks). This would include, for example, the operation of active gas collection systems that remove ignitable, corrosive, reactive or toxic vapors or maintenance of active holding tanks or ponds holding substantial volumes and control mechanisms requiring daily/weekly attention. In addition, subordination will be required if the mortgage specifically limits use of the property in a way that directly conflicts with the RC. For the easement holder, consent and joinder will be required only when an active control meeting the criteria is located in the easement area, or an engineering control (such as a cap) is located in the easement area, and the easement holder has a right to interfere with the control. Finally, consent and joinder can be required when the easement holder has rights to disturb the soil or groundwater in connection with potential installation of utilities, but has not yet done so, unless the owner demonstrates that the risks posed are small based on the nature and extent of existing contamination in the easement area.

As is the case with the published notice, the lender or easement holder will have 30 days from the date of receipt to provide comments to the Department. In addition, those third parties may exercise any rights they have under the mortgage or easement if the RC is in violation of the terms of the instrument, and retain the right of any substantially interested party to object to the issuance of the SRCO based on the RC. Fundamentally, the policy revisions place the right and responsibility for interpreting and enforcing private party contract rights with the appropriate parties — the parties to that agreement and not the Department while ensuring that those parties have been provided with adequate notice and multiple points of entry to the process. In addition, DEP staff are not put in the position of evaluating the contract rights or intentions of parties to existing recorded instruments, which has proven inefficient and time-consuming and subject to differing interpretation.

These changes have also allowed the Department to eliminate the requirement that DEP technical staff review title work before sending draft RCs to Tallahassee for review, further streamlining the RC review process. The Department is expected to formally roll out the revisions to the regulated community through a webinar to occur later this year.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Carlton Fields | Attorney Advertising

Written by:

Carlton Fields

Carlton Fields on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.