In a significant decision on eligibility of property for the New York Brownfield Cleanup Program (“BCP”), on Thursday, December 17, the First Department of the New York State Supreme Court, Appellate Division, held that the Department of Environmental Conservation (“DEC”) improperly excluded three Manhattan properties from the BCP that qualified under the Program’s definition of a “brownfield site.” In so holding, the appellate court affirmed the judgment of the lower court, which had set aside the DEC’s decision to exclude the properties. East River Realty Co., LLC v. New York State Department of Environmental Conservation, — N.Y.S.2d —-, 2009 WL 48411151 (1st Dept. Dec. 17, 2009) (“ERRC“).
DEC had argued that the property in question did not meet the eligibility criteria for a “brownfield.” Generally a brownfield is defined as property whose redevelopment or reuse of may be complicated by the presence or potential presence of a contaminant. The DEC contended that the property would have been redeveloped even without participation in the BCP, rendering it ineligible for the program. In a unanimous decision, the Court rejected DEC’s argument that a property may be deemed ineligible for participation in the BCP on the ground that the property would have been remediated regardless of such participation.
In rejecting DEC’s denial of eligibility under its application of a “but for” test, the Court cited two recent brownfield cases that similarly found DEC’s reliance on extra-statutory factors arbitrary and capricious. See Destiny USA Dev., LLC v. New York State Department of Environmental Conservation, 63 A.D.3d 1568 (4th Dept. 2009); HLP Props., LLC v. New York State Department of Environmental Conservation, 21 Misc. 3d 658 (Sup. Ct. N.Y. County 2008).
ERRC reaffirms the approach taken by the courts in Destiny and HLP, where the courts have required DEC to adhere to the eligibility criteria set forth in the BCP enabling statute, and struck down DEC eligibility decisions which seek to rely on factors outside the statute.
In addition to its reversal of DEC’s eligibility determination, the ERRC decision upheld the court below’s order that DEC accept the subject properties into the BCP. The Court agreed that given the sufficiency of evidence before the lower court, remand to the agency was not required.
SPR represented ERRC in connection with its challenge to DEC’s exclusion of the subject property from the BCP. For more information, please contact Daniel Riesel, Mark Chertok, Jeff Gracer, or Michael Bogin.
- Read a copy of the decision here
- Read more on brownfields issues
