SRRA HOW ARE WE DOING?
The Site Remediation Reform Act ("SRRA") and the New Jersey Licensed Site Remediation Professional ("LSRP") program have been up and running since 2009. It introduced a number of new initiatives and a whole new way of doing business in regard to environmentally contaminated sites. So where do we stand today? Here is some information and a few statistics that you might find interesting:
- There are now at least 579 LSRPs. While LSRPs are necessary in regard to completing legally-required investigation and remediation efforts with the New Jersey Department of Environmental Protection ("NJDEP"), questions and debates still abound as to the use of LSRPs in transactions and, particularly, in regard to due diligence.
- Approximately 763 cases have been referred to enforcement. We have noted an uptick in compliance actions and NJDEP follow-up. As NJDEP personnel are freed up from reviewing on-going cases, they have been redeployed into bringing cases that are out of compliance back into compliance. This should be a wake-up call to those managing matters that have been languishing and that have not submitted their Remedial Investigation Reports ("RIRs") or otherwise not complied with applicable regulations.
- Relatedly, there was a May 2014 deadline for the submission of RIRs for cases in which there was a discharge before May 7, 1999. Of the 4,735 cases impacted, 539 still do not have an LSRP assigned. These are cases that are now clearly out of compliance. There is a whole other universe of cases that have an LSRP but still have not filed an RIR. There is no information as to how the NJDEP may deal with those cases, or when. But, in instances in which an RIR cannot be expeditiously completed, keeping the NJDEP advised as to on-going activities and other such strategies may help to avoid the imposition of penalties.
- To date, more than $3 million in penalties have been assessed against 89 entities or responsible parties for failure to comply.
- Six Response Action Outcomes ("RAOs") have been invalidated by the NJDEP. It should be noted that the NJDEP reserved the right to audit RAOs for a period of three years after issuance and to invalidate RAOs at any time if it is determined that the remediation is not protective of public health, safety or the environment. Among other things, this right must be addressed in the context of transactions, and obligations for responding to any such invalidation must be clearly assigned.
- New proposals in the areas of the Technical Regulations and the Administrative Requirements for the Remediation of Contaminated Sites are expected shortly from NJDEP.
There is no question that the new program is helping to move compliance along a more efficient track. In that regard, the average number of days for LSRP submissions to be deemed administratively complete is approximately 21, and the NJDEP total process time to inspect and review LSRP submissions is approximately 54 days. Transactions are no longer hindered by lagging NJDEP filing and response times. There are complications associated with the SRRA, however, that must be taken into account in the sale, purchase and management of environmentally-challenged cases in New Jersey.
A newly-announced NJDEP policy provides that NJDEP personnel will not be reviewing submissions as they are filed but only at such time as the final RAO is submitted, which, for the regulated community, creates a scenario in which problems are not identified until the end of the process as opposed to during the process.
Finally, all remedial action, including implementation of engineering or institutional controls, require retention of an LSRP. Accordingly, even when remediation is substantively complete, an LSRP is still required, at all times, for a case that has a Deed Notice, Classification Exception Areas, Soil Remedial Action Permit, and/or Ground Water Remedial Action Permit until the remediation action(s) is no longer needed to protect the public health and safety and the environment. This includes, but is not limited to, site inspections, ground water sampling, and certification filing requirements and is yet another obligation that must be addressed in the context of transactions.