February 16, 2010
On Wednesday, February 11, the First Department of the New York State Supreme Court, Appellate Division, held for the second time that the Department of Environmental Conservation (“DEC”) improperly excluded a Manhattan property from the Brownfield Cleanup Program (“BCP”) HLP Properties, LLC v. New York State Department of Environmental Conservation, — N.Y.S.2d —-, 2010 WL 455321 (1st Dept. Feb. 11, 2010) (“HLP”).
As it has argued in several cases, DEC contended that the property in question did not meet the eligibility criteria for a “brownfield” because the Site was already subject to a voluntary cleanup agreement. In a unanimous decision, the Court held that DEC had “improperly departed from statutory criteria,” noting that this result was “compelled” by its recent decision in East River Realty Co., LLC v. New York State Department of Environmental Conservation, 68 A.D.3d 564, 891 N.Y.S.2d 359 (1st Dept. 2009) (“ERRC”), which rejected such arguments by DEC. As it had held in ERRC, the First Department also held that remand to DEC for a new determination was unnecessary in light of the extensive record before it.
HLP represents the third consecutive Appellate Division decision striking down DEC’s efforts to exclude properties from the BCP based on extra-statutory factors. See also Destiny USA Dev., LLC v. New York State Department of Environmental Conservation, 63 A.D.3d 1568 (4th Dept. 2009) (“Destiny”).
The Court of Appeals will soon address related issues in a different context, having recently heard oral argument in an appeal where DEC’s exclusion of property was upheld based on DEC’s conclusion that the contaminants at issue did not exceed levels that would require remediation. Lighthouse Point Property Assocs. v. New York State Department of Environmental Conservation, 61 A.D.3d 1438 (4th Dept. 2009). HLP, ERRC, and Destiny all involved sites where the contaminant levels were significantly above DEC’s remediation standards, and where DEC conceded that remediation was necessary.
SPR represented HLP and ERRC in connection with their challenges to DEC’s exclusion of their property from the BCP. For more information, please contact Daniel Riesel, Mark Chertok, Jeff Gracer, or Michael Bogin.
December 18, 2009
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.
September 24, 2009
The U.S. Environmental Protection Agency (“EPA”) is proposing to add New York City’s Newtown Creek to its National Priorities List (“NPL”) of sites with known or threatened releases of hazardous substances throughout the United States and its territories. The NPL is EPA’s list of sites that warrant further investigation and long-term cleanup. This proposed action follows closely on the heels of the well-publicized and hotly-contested proposed listing of the Gowanus Canal as an NPL site.
As it did with the Gowanus Canal, the State of New York referred Newtown Creek to EPA “due to the complex nature of the contamination along the creek.” This complexity apparently stems from the myriad types and potential sources of contamination. As EPA noted in its press release for the proposed listing, contamination found in Creek sediment and surface water samples includes pesticides, metals, PCBs, and volatile organic compounds (“VOCs”), the last category of which are potentially harmful contaminants that can easily evaporate into the air.
From the mid-19th century until World War II, Newtown Creek was a hub of a growing industrial America: more than 50 industrial facilities were located along its banks, including some of the nation’s largest oil refineries, petrochemical plants, copper production and smelting plants, fertilizer and glue factories, sawmills, and lumber and coal yards. Industrial pollution resulted from these activities and from the City’s sewers that for many decades dumped untreated into the Creek. Some factories and facilities still operate along the Creek and its tributaries, and various adjacent contaminated sites have also potentially contributed to its contamination. As a result, Newtown Creek is, according to the EPA, “badly polluted” and its listing on the NPL “will allow EPA to build on the extensive sampling of the creek that has already been done.”
EPA’s press release does not explain the need for an NPL listing, given that in 2007 New York Attorney General Andrew Cuomo commenced litigation against Exxon Mobil Corp., BP, Chevron Corp., Keyspan Corp. and Phelps Dodge Corp. for their respective roles in polluting the Creek. Also it is not clear how an NPL listing would affect any of the other three suits brought by private parties and the environmental group Riverkeeper that seek cleanup of the Creek and at least $58 billion in damages. Whether this proposed listing provokes opposition from the City of New York and others, similar to the proposed Gowanus Canal listing, will probably be known soon. It is worth noting that only several months ago, in June 2009, the City spent $100 million to purchase 30 acres of property at the mouth of Newtown Creek to construct the largest middle-income housing development in New York since the 1970s. Known as “Hunter’s Point South,” that project will include 3,000 affordable housing units, a 1,100-seat high school, 11 acres of parkland, and a network of pedestrian walkways and bike paths along what may soon be a new federal Superfund site.
No one knows yet how wide EPA intends to cast the Superfund liability net. In the event the Creek is listed, property owners along the waterway and in the immediate area may face claims relating to the current and historic uses of their property, and the extent to which these uses may have contributed to Creek contamination. These parties may be well served by making their interests known in EPA’s public comment period which accompanies any NPL listing. The public comment period for Newtown Creek began September 23, 2009, and will remain open for sixty days. Comments may be submitted via EPA’s website here.
August 14, 2009
The construction of Brooklyn Bridge Park continues, with the building of the “grand staircase” which will overlook the Brooklyn Bridge, downtown Manhattan, and New York Harbor. The website NewYorkology has posted some photos of the staircase, and explains that it is constructed from recovered materials:
The stones are actually recycled and worn with age and graffiti from another East River location … the Roosevelt Island Bridge, which is undergoing its own massive reconstruction project.
SPR represented the Brooklyn Bridge Park Development Corporation (BBPDC) in connection with the environmental review of the park under the New York State Environmental Quality Review Act (SEQRA), and subsequent litigation surrounding the development and approvals of the park. See more examples of SPR’s development and land use work.
View more photos of the construction at NewYorkology.
August 7, 2009
A report recently released by the Trust for Public Land makes the case that land conservation–in the form of conservation easements, cluster zoning, or public parks–creates substantial economic benefits both to private landowners and the public at large. The report provides useful summaries of numerous studies which seek to evaluate and quantify the economic benefits of parks and conserved land. For example, the report describes Bryant Park in Manhattan, whose revitalization, a study claims, may be responsible for a near doubling of commercial rents in nearby office space as compared to surrounding neighborhoods. Similarly, Seattle’s Olympic Sculpture Park overlooking Puget Sound in downtown Seattle is credited with sparking new business development in adjacent areas, and notably increasing nearby residential values.
The report links land conservation with numerous environmental benefits, which may be described in economic terms by calculating the value of “ecosystem services” they provide. These include reduction in the need for stormwater treatment, promotion of water quality, reducing cooling costs by mitigating the urban “heat island” effect, and preventing costs associated with global warming, due to carbon sequestration in preserved lands. All of these spillover effects benefit the public at large, the report argues, while increased real estate values inure to the public benefit through increased local tax revenues. To see examples of SPR work on public open space, see our Project Updates pages.
July 31, 2009
New York’s highest court has annulled an approval by the Town of Chili (Monroe County) Planning Board of a proposed metal shredding facility on the grounds that the environmental review of the facility, undertaken pursuant to the State Environmental Quality Review Act (“SEQRA”), was inadequate. The Court of Appeals held that the environmental review failed to consider the risk of fires and flying projectiles from explosions at the facility that could adversely impact aircraft at an adjacent airport. Anderson v. Town of Chili Planning Board, 2009 WL 1850972 (No. 173 SSM 17, June 30, 2009). The risks to aircraft had been raised in a public comment submitted after the Planning Board had received input from the Town’s fire marshal and airport approval from the country planning agency. Because the environmental review was never updated to account for this risk, the Court of Appeals remanded the matter to the Planning Board for further proceedings.
The metal shredding facility was proposed by applicant Metalico Rochester, Inc., and the environmental review was conducted by the Planning Board with input from other relevant agencies and officials. As part of the SEQRA review, the Town’s fire marshal required installation of a fire-suppression system, and identified other measures to minimize the risk of explosions. The facility complied with height restrictions, and received airport approval from the county planning agency. The public then raised the potential risk to the adjacent airport, and the Planning Board failed to respond. The SEQRA process was concluded when the Planning Board adopted a Negative Declaration for the facility and issued a conditional use permit. Petitioners sued to challenge the SEQRA review and Planning Board approval. The trial court dismissed the petition, finding the SEQRA review sufficient.
The Appellate Division Fourth Department affirmed, with two justices dissenting. Anderson, 59 A.D.3d at 1017. While the majority appellate opinion noted that, “[t]he risk to aircraft was not specifically addressed in the [Environmental Assessment Form] or at the public hearing” that fact did not sway its decision. Instead, the majority held over dissent that despite the fact that “the precise concern” of potential impacts to aircraft was not addressed, viewed in light of the SEQRA “rule of reason,” the approval should be upheld.
The Appellate Division dissenters—whose reasoning was adopted by the Court of Appeals—disagreed, writing that, “it is not enough that the Planning Board considered the views of the Fire Marshal … inasmuch as it appears that neither had considered the risk to airplanes using nearby runways.” Id. at 1020. The dissent noted that petitioners had raised the potential risk of “explosions in the shredder resulting in fires and the risk of flying projectiles from the shredder with respect to airplanes using nearby runways” only after the fire marshal’s review and recommendations on the project. Ultimately, these concerns were found by the dissent and the Court of Appeals to be “sufficiently serious that they should have been addressed explicitly” before the applications were approved.
The case highlights the need for lead agencies and applicants to carefully analyze comments in the SEQRA process for their significance and, if necessary, respond to comments with additional substantive analysis. Failure to respond to comments that raise potentially significant issues creates a litigation risk, which may result in reversal and remand of a project approval.
June 9, 2009
On Friday, June 5, the Appellate Division, Fourth Department, in Destiny USA Development, LLC v. DEC, CA 08—1855 (4th Dept. June 5, 2009), substantially upheld a lower court decision from Syracuse that:
- Holds the New York State Department of Environmental Conservation (DEC) improperly interpreted the Brownfield Cleanup Act when it excluded contaminated properties from the state’s Brownfield Cleanup Program (BCP); and
- The Fourth Department also upheld the lower court’s order requiring DEC to admit the properties into the BCP.
The Destiny decision expressly cited and followed reasoning adopted by two lower courts regarding DEC’s improper exclusion of contaminated properties in Manhattan from the BCP. HLP Properties, LLC v. DEC, 21 Misc. 3d 658 (Sup. Ct. N.Y. Cty. 2008); East River Realty Co., LLC v. DEC, 22 Misc. 3d 404 (Sup. Ct. N.Y. Cty. 2008). SPR is counsel to HLP and East River Realty.
In a case now pending before the Court of Appeals, the Fourth Department upheld DEC’s exclusion of property from the BCP when contamination present at a property was not sufficient in DEC’s judgment to require remediation. Lighthouse Pointe Property Association, LLC v. DEC, 61 A.D. 3d 88 (App. Div. 4th Dept. 2009). In Destiny, by contrast, DEC acknowledged that contamination was present at levels above cleanup standards and did not dispute that remediation was required; it sought instead to exclude the property based on non-statutory economic factors set forth in a DEC guidance document. Quoting HLP and a Court of Appeals decision, the Fourth Department held that DEC could not exclude property that meets statutory eligibility criteria based on non-statutory guidance factors.
The Lighthouse decision is expected to be heard by the Court of Appeals in the fall of 2009. Meanwhile, the Fourth Department’s recent decision in Destiny demonstrates that New York courts remain ready, willing and able to ensure that DEC follows statutory mandates and does not improperly exclude properties from the BCP.
Recently, however, legislation has been introduced in the New York State Senate that would retroactively cap the qualified tangible property tax credit available for successful litigants in pending BCP cases, but not provide increased site remediation tax credits afforded to other property owners under BCP amendments enacted in 2008. Questions have been raised about whether such legislation is unconstitutional and represents unwarranted legislative interference with pending litigation.
SPR represents HLP and East River Realty in connection with their successful court challenges to DEC’s exclusion of their properties from the BCP, which are currently on appeal to the Appellate Division, First Department. For more information, please contact Daniel Riesel, Mark Chertok, Jeff Gracer, or Michael Bogin.
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