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October 16, 2020

Lamont signs bill aimed at redeveloping unused, contaminated properties

Photo | FILE IMage Some properties that have fallen under the Transfer Act have sat idle for years and have attracted vandals, such as this property on Whalley Avenue in New Haven.
By Michelle Tuccitto Sullo

Hundreds of polluted properties around the state have sat idle because they have fallen under the controversial law commonly referred to as the “Transfer Act.” 

Now, new legislation aims to give these properties a better chance at redevelopment.

Gov. Ned Lamont recently approved revising the law and instituting a “release-based” hazardous material remediation program common in other states.

According to Lamont, the change will promote the revitalization of environmentally contaminated, blighted parcels and put them back into good use, while helping municipal economies and ensuring environmental protection.

The Connecticut Property Transfer Act of 1985 originally was enacted to place restrictions on the sale of properties with environmental pollution so they could not simply be transferred unremediated from one owner to the next.

According to many in the real estate industry and municipal leaders, the law had the unintended consequence of leaving properties — some with only minor or even just potential contamination — ending up as idle eyesores.

The legislation sunsets the Transfer Act and institutes a new release-based regulatory program. According to Lamont’s office, instead of singling out certain properties with onerous requirements, the new system will focus on compliance in cases that pose the greatest environmental risk. It creates standards to guide cleanups of low risk spills “without a lot of red tape.”

The hope, according to Lamont, is that this new approach will make parcels that have been unused for years more attractive to private investors.

“This new law will streamline cleanups of contaminated properties, bring properties back to life,” Lamont said. 

In the past, some property owners abandoned locations due to the costs of remediation, the time involved, or the uncertainty. 

State Department of Energy and Environmental Protection officials have indicated there are about 4,200 sites around the state which have fallen under the Transfer Act. Only about 25 percent of them were ever cleaned up and transferred, officials said.

This meant fallow properties and lost tax revenue for municipalities.

State Sen. Christine Cohen, D-Guilford, said her district alone has had 134 different sites subject to the Transfer Act, including 73 in Branford, 25 in Guilford, 17 in North Branford, 14 in Madison and five in Durham.

In New Haven, state environmental officials have dealt with about 234 filings, with many properties having prior manufacturing, automotive and dry-cleaning uses. 

“The results in other states have proven that, with a released-based approach, more hazardous releases are cleaned up and there are fewer problems transferring properties from one owner to the next," Cohen said, after the bill passed the Senate earlier this month. “I believe this bill will get us moving ahead on economic revitalization while protecting Connecticut's soil, water and air at the same time."

The real estate community has been calling for changes to the state law for years.

Christopher Nicotra of Apollo Investment Properties of Fairfield predicted the change will attract more business to the state.

“The changes are phenomenal,” said Nicotra. “It will have a major effect on commercial real estate values over the years. There are properties that have languished for years, and this will help get them back to being used again.”

According to Nicotra, people have been unable to sell their properties if they were covered by the Transfer Act, as cleanups were cost-prohibitive.

“It’s exciting to finally see change,” Nicotra said.

For months, a working group of lawmakers, environmental and business professionals discussed what changes should be made to the law.

DEEP Commissioner Katie Dykes said both businesses and environmental leaders have been calling for reform.

“We are responding to that call, and will finally move to a more effective release-based cleanup framework that matches the rest of the country,” Dykes said. “This new approach will protect our environment and our communities while incentivizing smart, sustainable and environmentally informed development. DEEP looks forward to working collaboratively with stakeholders on the regulatory framework in the months ahead.”

David Lehman, the state’s commissioner of economic and community development, said the Transfer Act “kept investors on the sidelines and left communities stagnant with decaying memorials of Connecticut’s former economic might.”

“This new law will begin to remove barriers and, as a result, encourage new private investment in properties all across our state,” Lehman said.

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