🔒After years of work, state leaders say they’re close to replacing burdensome Transfer Act

Three years after state lawmakers agreed to replace the state’s burdensome system that governs environmental cleanups of potentially contaminated properties, Gov. Ned Lamont visited Waterbury Friday to announce progress toward sunsetting the Transfer Act.

Some members of the business community, however, have voiced concern about elements of the first draft of the new regulations, and are urging patience to get it right.

In 2020, state lawmakers agreed to a process to replace the Transfer Act with a release-based system more akin to the methods employed by 48 states.

“The Transfer Act is a relic of the past, and that’s where it belongs,” Lamont said. “We should be celebrated for our industrial past, not penalized by it.”

Only Connecticut and New Jersey employ a Transfer Act system, in which industrial and commercial properties deemed as potentially contaminated are required to have environmental investigations and cleanup at the time of a sale or other type of transfer.

Under the current system, any property that produced or stored more than 220 pounds of hazardous waste in any given month is subject to a lengthy and potentially onerous state review to prove the property is safe. The nearly 40-year-old system is widely disliked by developers and property brokers, who view it as a heavy-handed, deal-killer that has stifled redevelopment efforts, particularly in post-industrial cities like Waterbury and Hartford.

More than 3,000 properties have entered the Transfer Act program since the 1980s, but less than 400 have been remediated, according to Lamont’s office.

The state’s environmental and economic agencies have been working for three years to craft the complex regulations needed to replace the Transfer Act, aided by a working group of dozens of environmental consultants, specialist attorneys and others.

In 2020, Connecticut lawmakers agreed to transition to a “release-based” system in which cleanups are undertaken when contamination occurs or is discovered. Essentially, that would remove the guilty-until-proven-innocent brand from properties where toxic material was stored or produced, but not necessarily spilled or mishandled.

According to Lamont’s office, the state’s goal is to have new regulations go through a public comment period and then to the General Assembly’s Regulation Review Committee, “with the goal of approval by the end of 2024.”  

Hard to drop

The Transfer Act doesn’t have many fans, but it has proven difficult to dump.

Samuel Haydock, a principal with Meriden-based engineering and environmental consulting firm BL Companies, said this is the third attempt to move to a release-based system in 15 years. He is an enthusiastic supporter of a move to release-based cleanups and generally optimistic about the current effort. 

Still, Haydock acknowledges stakeholders have some concerns with some portions of the new regulations shared with the working group in December.

For one, some worry the new regulations might pull residential, municipal and institutional properties into the same rigorous reporting and action requirements that commercial and industrial properties face, Haydock noted. 

Some working group members are also worried about a more exacting contaminant testing regime that could increase costs with little public safety payoff, he said.

Haydock said he realizes there is pressure to finish regulations, but urged patience to get the best possible result and finally bury the Transfer Act. That means taking time for more input from the working group before soliciting public opinion on a final draft, he said.

“We are optimistic we can get this right,” Haydock said. “This has to be a success. We can’t have this fail again.”

The Connecticut Business & Industry Association is also raising a number of questions and concerns, among them the potential costs to residential property owners. Housing costs in Connecticut are already high, and any new regulations could add to the burden, which is a concern for businesses starved for employees to fill job openings.

CBIA lobbyist Peter Myers said his organization is optimistic that regulators and the working group can work together to avoid unintended consequences.

“We are hopeful something productive will come out of this,” Myers said. “We want to see an improvement. The business community still has questions for DEEP, and we are hopeful they can address some of these concerns.”

What’s the rush?

Emilee Mooney Scott, a Robinson + Cole attorney on the working group, said there is some concern about perceived pressure to get the regulations over the finish line. DEEP has given working group members until March 7 to submit comments to be considered for the next draft.

Mooney Scott said some “thorny issues” have been raised.

“I do believe they can be resolved through continued engagement with stakeholders, but we will really need to see how they are resolved in the next draft,” Mooney Scott said.

DEEP staff say input from the working group has been crucial, and will continue to help shape the new rules well beyond March 7.

“Their feedback has been critical,” said Emma Cimino, deputy commissioner of environmental quality for DEEP. “They are the industry insiders. They are the folks on the ground. And this work we have done, this transition, would not be possible without their input and their input is ongoing.”

Brendan Schain, an attorney with DEEP, stressed top agency staff have held multiple meetings with industry and stakeholder groups since draft regulations were released Dec. 29, and there will be additional outreach as the regulatory adoption process begins this spring.

Speaking with the Hartford Business Journal Friday, DEEP staff said they aim for the legislature’s Regulations Review Committee to sign off on the new rules in 2025. Staff anticipate some delay in implementation.

“We have taken the time to get to where we are today,” said Graham Stevens, chief of DEEP’s Bureau of Water Protection and Land Reuse. “It’s incumbent on DEEP to show our stakeholders that we are listening, and we will deliver a regulation that rings true for all the stakeholder objectives we are trying to embrace.”