Transforming Brownfields: What You Need to Know About ADEM’s Latest Division 335-15 Regulation Updates
The Alabama Land Recycling and Economic Redevelopment Act (ALERA) marked a turning point for brownfield redevelopment in Alabama. Since the launch of the Brownfields Redevelopment and Voluntary Cleanup Program (VCP) in May 2001 following the passage of the Act, the Alabama Department of Environmental Management (ADEM) has received 396 applications and assessed, remediated, and returned over 250 sites to productive use. Currently, there are 85 active sites enrolled in the program.
Recent updates to ADEM’s Division 335-15 regulations are set to make the program even more accessible and beneficial for property owners and developers. These changes simplify the application process for Responsible Party applicants, provide earlier liability protections, and can establish new funding mechanisms to support redevelopment. Here’s what you need to know about the latest updates.
Introducing the “Responsible Person Applicant” Category
Historically, the VCP applicants fell into two categories: Responsible Party or Non-responsible Party. A Responsible Party refers to anyone who has contributed to or is contributing to the release of hazardous waste, hazardous constituents, or hazardous substances at a property or has failed to conduct proper due diligence before purchase. A Non-responsible Party is defined by ADEM as anyone who is not a Responsible Party. (Note: most lenders do require at least a Phase I Environmental Site Assessment prior to lending the funds to purchase a property.)
The Brownfield Remediation Reserve Fund Act of 2023 introduced the Responsible Person Applicant category. This designation applies to owners and operators of qualifying properties who enroll in the VCP and submit an ADEM-approved Voluntary Property Assessment Plan (VPAP) or Voluntary Property Assessment Report on or after the Act’s effective date. (Act Number 2023-356, 2023 Regular Session) [ADEM Admin. Code r. 335-15-4-.03, April 14, 2024]
Additionally, this Act has altered the timeline for liability protections. Previously, a Responsible Party was required to complete the VCP to obtain liability protections from the state. Liability protections for Responsible Person Applicants now begin upon the approval of their VPAP, rather than requiring the entire cleanup process to be completed. This change provides earlier and broader protection, shielding applicants from liabilities imposed by the state and third parties, significantly reducing risk for property owners.
Streamlined Contamination Delineation Requirements
Another key update involves the delineation of contamination on qualifying properties. Previously, applicants were required to map contamination both on and off their property. Under the new regulations, Responsible Person Applicants are no longer required to delineate off-site contamination and may focus on known contaminants, delineating groundwater contamination within the property border while addressing its full vertical extent. [ADEM Admin. Code r. 335-15-4-.06, April 14, 2024] This change reduces the burden of off-site investigations, saving time and resources while maintaining environmental safety.
What Is a “Qualifying” Property?
Not all properties are eligible for the program. To be considered eligible according to the Division 15 regulations, a property must meet the following criteria:
- The property cannot be listed on the federal National Priorities List.
- The property cannot be undergoing cleanup activities ordered by ADEM or the United States Environmental Protection Agency (US EPA) in accordance with the federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).
- The property cannot be a hazardous waste treatment, storage, or disposal facility subject to the permitting requirements of Division 335-14-8-.01 through Division 335-14-8-.08. [ADEM Admin. Code r. 335-15-2-.01, April 14, 2024]
These eligibility requirements ensure the program targets properties best suited for redevelopment.
The Brownfield Remediation Reserve Fund
A key feature of the updated regulation is the Brownfield Remediation Reserve Fund, created to provide financial support for post-remediation costs. Responsible Person Applicants contribute $500 per acre for each qualifying property, with the fund capped at $4 million per property. Notably, this fee is separate from, and not included as part of, the VCP application or associated oversight fees. The fund excludes reimbursement for long-term groundwater monitoring, soil management plans, or expenses resulting from non-compliance with response actions or land use controls specified in environmental covenants. Eligible owners and operators can request reimbursements from the reserve fund by submitting documentation verifying their payments for approved post-remediation expenses.
Promoting Redevelopment Through Brownfield Districts
Local municipalities can now establish Brownfield Districts within their jurisdictional boundaries to enhance the marketability of properties and create opportunities to secure grant funding for redevelopment projects. While ADEM does not currently oversee the creation of these districts, local municipalities can leverage them to spur redevelopment. According to Sara Janovitz, Brownfields and Redevelopment Section Manager at the US EPA, Brownfield Districts that meet the guidelines outlined in the brownfield grants package are eligible to receive funding.
Unlocking the Full Potential of Alabama’s Brownfields
Despite the program’s new benefits, participation has been slow, with only three sites enrolling as Responsible Person Applicants as of October 31, 2024. However, the expanded liability protection, streamlined contamination delineation requirements, and financial support offered by the Brownfield Remediation Reserve Fund could significantly benefit owners of former industrial properties. By addressing contamination early and offering financial safeguards, the updates to Division 335-15 regulations position Alabama to transform underutilized properties into productive assets.
Do you own a property with redevelopment potential? The latest changes to ADEM’s Brownfields Program could help you unlock its value. Contact Chey-Anne Kilpatrick at (334) 662-7357 or ckilpatrick@labellapc.com to learn how we can assist in getting your site enrolled.
