Maine’s “Wicked Good” Voluntary Cleanup Program

by Pierce Atwood LLP

Pierce Atwood LLP

Maine’s Voluntary Response Action Program (VRAP) was enacted in 1993 to encourage the cleanup and redevelopment of Maine’s contaminated properties.  The VRAP law is short and found at 38 M.R.S. § 343-E. VRAP is administered by the Maine Department of Environmental Protection (DEP). Several innovations make Maine’s VRAP law a useful contaminated property program, with features that other states might want to emulate.

In a nutshell, the law allows applicants to voluntarily investigate real property—and remediate the property, if appropriate—in exchange for state liability protections from DEP enforcement and cost-recovery actions for known contamination. A summary of the Maine VRAP follows.

Qualifying Properties and Applicants

DEP’s VRAP “Issue Profile” (Mar. 2018) states that:

Any property, including those involved in a real estate transaction (acquisition, refinancing, foreclosure, etc.), that has documented contamination of the surface or subsurface soils and/or groundwater as a result of discharges of contaminants, is potentially eligible for the program. While the law does not specifically preclude any type of site from eligibility, properties operating pursuant to a license issued by a specific program within the Department, or those that may fall under the jurisdiction of another program (e.g., RCRA, Superfund, etc.), may not be eligible for participation in VRAP. When an application is received, the Department will determine a site’s eligibility for VRAP.  

With the exception of the carved-out properties, most any property—whether subject of a planned real estate transaction or not—is eligible.

Eligibility is addressed on a case-by-case basis for properties that are licensed and operating solid waste or hazardous waste treatment, storage or disposal facilities; hazardous waste generators; or properties with underground storage tanks. For example, if the contamination issue has nothing to do with the fact that the facility generates hazardous waste on an on-going basis, VRAP should still apply to the contamination issue. VRAP will defer to Maine DEP’s hazardous waste program to address hazardous waste closure and Resource Conservation and Recovery Act (RCRA) corrective action issues.

Only the parties applying for inclusion of the property in VRAP and supplying the funding will receive liability protections. Those may include both current and prospective owners, though once VRAP liability protections are secured, successor owners and assigns obtain liability protections by operation of law. Current owners and operators will receive liability protection if they implement the cleanup and remove or remediate all known releases. For a “partial cleanup” (e.g., where soil is cleaned up, but not groundwater), an “otherwise responsible party (i.e., the current owner/operator of the property) does not receive liability protection.” A partial release may be obtained. For example, if soils are remediated but groundwater is not, DEP may issue a release for liability related to soils, and an environmental covenant prohibiting the use of groundwater for drinking or other purposes will likely be required.

Applications, Fees, and Information to Be Submitted

A completed five-page application must be submitted, together with all environmental reports. Typically, DEP requires at least a “phase I” environmental site assessment (meeting the ASTM 1527-E standard), and “phase II” results (sampling data) are often included. Effective January 1, 2018, the fee for a VRAP application is equal to 1 percent of the assessed value of the property at the time the application is submitted, subject to a $15,000 cap. Prior to 2018, the VRAP application and review fees were quite modest, so there has been only 10 months’ experience with this new fee program. Reports so far are that VRAP is on pace for a typical year.

Pursuant to submission guidelines that are periodically updated, DEP requires that applicants provide information on nearby groundwater users (public water supply sources and private wells), the possibility of vapor intrusion, and how the site is classed in the VRAP “Public Communication Decision Matrix. This matrix requires notice to abutters and others if groundwater contamination is known to be migrating off-site. All sites go onto a publicly available list.

Applicants must agree to comply with laws that require submission of information to DEP and to keep records of costs for properties that have been the subject of underground or aboveground petroleum storage tank discharges.

Plan Approval and No Action Assurance

If environmental information indicates no cleanup is necessary, DEP issues a “No Further Action Assurance” letter. If a cleanup plan is approved, DEP issues a “No Action Assurance” letter stating that no enforcement action will be taken against the parties for the cleanup activities following the plan.

Once the cleanup is complete and documented to the department’s satisfaction, which to date has not been unreasonably withheld, DEP will issue a Certificate of Completion, to be recorded in the county registry of deeds.

It is very important to remember that a No Action letter does not provide protection for “unidentified,” “undiscovered,” or “uncharacterized” contamination, or “unaddressed” environmental conditions. Thus, the quality of the site investigation is extremely important. Similarly, a VRAP letter cannot provide any protection against liability for conditions arising after the date of the letter, nor does it protect against third-party civil liability, criminal liability, or any federal liability.

Experience to Date

One of the most helpful features of VRAP is the timeliness of DEP’s response, and DEP’s recognition that many of the properties are the subject of proposed transactions or redevelopment—with attendant deadlines. DEP also is willing to meet with potential applicants to discuss what data would be helpful, and what possible cleanup might be appropriate. DEP typically insists that federal Brownfields sites go through the VRAP program.

Of the hundreds of VRAP applications received by DEP since 1993, DEP reports that over 80 percent have been resolved with “No Action” letters, and at least most of those have Certificates of Completion issued.

DEP liability protections are often conditional on recording activity and use limitations, such as limits on groundwater use, limits on residential development, and environmental media management plans requiring attention to soil and groundwater conditions in the event of excavation. Those must be adopted as “Environmental Covenants” under Maine’s Uniform Environmental Covenants Act.

Recommended Changes

Although Maine’s VRAP has been very popular and has returned hundreds of blighted properties back to productive use, even the most finely tuned machines need repairs or new parts from time to time. Given this, we offer the following as recommendations to improve Maine’s program:

  • VRAP is all about cleaning up contaminated sites and getting them back to productive use. But many contaminated sites that have been dormant for an extended period of time (e.g., 5 or 10 years) require additional incentives to attract developers with resources to remediate and develop the sites. For these long dormant contaminated properties, Maine should consider either a property tax credit or property tax holiday for a specific period of time—for example, seven years—provided a VRAP No Action Assurance letter and Certificate of Completion are obtained. The property tax benefit could be capped at 50 percent of the investigative and remedial costs incurred. We realize that this would require legislative action. But far better to have these properties cleaned up, redeveloped, potentially employing people, and ultimately back on the tax rolls, than allowing them to continue to sit dirty and dormant.
  • The current VRAP letters being issued state that they do not extend protection to any person who caused or is otherwise responsible for the release. However, the law only bars protections for persons who caused the release for “partial” plans that do not require removal or remediation of all known releases. To be consistent with the law, a current owner or operator that caused or is otherwise responsible for a release should get liability protections for releases he remediates.  After all, the release is being remedied (and it is worth acknowledging that most releases are not intentionally caused).
  • DEP should be more liberal in allowing access to VRAP for sites subject to RCRA, the Comprehensive Environmental Response, Compensation, and Liability Act, and state solid waste programs. Where a site cleanup has been or is being completed to the satisfaction of those programs, there is no policy reason not to encourage cleanup and grant liability protections.

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.

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