Liability at a brownfield is typically the legal responsibility for costs of cleaning up property that is contaminated (or thought to be contaminated) by a past owner or operator. Liability is based on the type of contamination found at the site, either hazardous substances or petroleum. Liability can be both strict and joint and several, depending on the applicable law.
- Strict liability: owners or operators can be held liable for contamination even if they did not cause or contribute to it, or did not know about it at the time of purchase
- Joint and several liability: one responsible party, including an owner who never used hazardous substances at the site, could be held liable for the entirety of the cleanup, notwithstanding the existence of other responsible parties
Concerns about liability issues for lenders and prospective purchasers are among the main potential obstacles to brownfields redevelopment.
State Mechanisms for Minimizing and Managing Liability
- Statutory liability exemptions for political subdivisions, lenders, trustees, fiduciaries, innocent landowners, prospective purchasers and contiguous property owners
- Risk-Based Cleanup Standards
- Enforcement discretion policies
There are several liability protections that may form the basis for a Comfort Letter. The three most commonly requested types are: Bona Fide Prospective Purchaser (BFPP), Lender, and Contaminated Aquifer.
The Program provides liability clarification for stakeholders that qualify for either a liability defense or application of an enforcement discretion policy. The Program also addresses the potential for IDEM to require a cleanup based on comparing site conditions to objective, risk-based standards found in the Risk-based Closure Guide (R2). Often these letters include the use of an institutional control in the form of requiring recordation of an environmental restrictive covenant (ERC) on the deed for the Site to ensure land uses do not result in contaminant exposure.
Liability Clarification Letters (Comfort and Site Status Letters)
The Indiana Brownfields Program (Program) attempts to eliminate liability concerns for stakeholders at sites where either an enforcement discretion policy or an exemption from liability based in statute applies. The Program also addresses the potential for the Indiana Department of Environmental Management (IDEM) to require a cleanup based on comparing site conditions to objective, risk-based standards found in the IDEM Risk-based Closure Guide (July 1, 2022 and applicable revisions) and Remediation Program Guide (RPG). The Program addresses these issues in either a Comfort or Site Status Letter, which is made available under the Brownfields Comfort/Site Status Letter Nonrule Policy Document.
A Comfort Letter is issued to a party that qualifies for an applicable exemption to liability found in Indiana law or application of an IDEM enforcement discretion policy, but is not a legal release from liability. A Comfort Letter is not transferable to other entities. A Comfort Letter explains the liability exemption or enforcement discretion policy for which the stakeholder has qualified and by which IDEM has determined not to pursue a party for cleanup. A Site Status Letter is issued to a party that did not cause or contribute to or knowingly exacerbate site contamination and can demonstrate that current levels of contaminants of concern at the brownfield substantially meet current cleanup criteria as established by IDEM. The potential cleanup liability of the party requesting the letter is not addressed. A Site Status Letter states that based on a technical analysis of information submitted to IDEM pertaining to site conditions, IDEM concludes that current site conditions do not present a threat to human health or the environment and that IDEM does not plan to take or require a response action at the brownfield site.
Comfort Letter/Site Status Letter Process Flowchart
Comfort/Site Status Letter Request Timelines
The length of the time required for the Program to issue a letter varies on the number of other requests already in the queue and the volume of data/reports associated with the site at issue that require review to draft the letter. Stakeholders should plan for a minimum of 120 days from the time the Program receives all pertinent documentation and information to receive the letter requested. Note: because the BFPP exemption was designed to be self-implementing, a stakeholder need not have IDEM’s Comfort Letter in hand at the time of a real estate closing to be protected under the law.
Comfort/Site Status Letter Requests
Please include the following information in a transmittal letter with your Comfort/Site Status Letter Request and all applicable forms (see below) to facilitate the timely review of your request:
- The basis in statute or enforcement discretion policy for the Comfort Letter request.
- Names, affiliations, contact information for all project stakeholders
- The parcel(s) comprising the site and the corresponding State 18-digit parcel number(s)
- A legible copy of the recorded deed(s) or a surveyed legal description(s) for the parcel(s) comprising the site
- The date of property acquisition (or proposed property transfer/closing date)
- Whether or not a purchase agreement has been finalized
- A black & white site map (no aerial photos) depicting property boundaries, parcel(s) & parcel number(s)
- Description of redevelopment project (type of development) including a site redevelopment/design plan (if available)
- Building size(s) (square feet), ceiling height(s), slab thickness, and HVAC air exchange rate(s) (if known VOC contamination & existing on-Site building(s) will continue to be used or are planned to be renovated)
- Map(s) depicting all utility corridors to and from the parcel(s) comprising the Site (if known VOC contamination)
- Applicable timeframes (application deadline) if this is an SBA Loan financed project
- Summarize HUD expectations regarding known environmental conditions on the Site if HUD financing being sought
- Tabulated and/or indexed relevant investigation/remediation reports. Other IDEM Program documentation should include (assigned IDEM site # and IDEM Virtual File Cabinet (VFC) Document #s) Reports Form
- Proposed or existing vapor mitigation system specifications
- Proposed building renovation details and/or new building construction specifications
- Purchase details (including combining multiple parcels on one deed, acquiring parcels on separate deeds, etc.)
- Explanation and associated documentation to support satisfaction of continuing obligations (including steps taken to mitigate exposures) if property already acquired
Important Comfort/Site Status Letter Submittal Information and Request Forms
E-Submissions
The Indiana Brownfields Program (Program) requests electronic submittals (e-submissions) of documents through the Portal (idem.in.gov/myesubmission). This e-submission site is available for public use and will replace all other forms as the preferred document submittal method. Program staff may, however, still request a hard copy for maps and/or large files.
E-submissions cannot be greater than 75 megabytes (MB). If a file cannot be reduced to less than 75 MB, it should be broken into multiple files. As a reminder, each form/document/report should be saved as a separate pdf, not as one large document as follows: Request Form(s), Cover Letter, Application, User Questionnaire, Reports (Phase I ESA, Phase II ESA, Completion Reports etc.), Deeds, Legal Descriptions/Surveys, and Maps (Maps not already included within a report).
The e-submission site is available to individual email addresses and shared email accounts. To request or modify your e-submission access, please use IDEM’s e-Submission Enrollment Form (idem.in.gov/myesubmission) Once enrolled, instructions on how to submit documents will be provided. Refer to the Brownfields Program Electronic (e-Submission) Folder External User Guide for instructions.
For issues or assistance with the e-submittal process, please contact Haley Faulds at 317-234-0685 or email hfaulds1@ifa.in.gov.
Below is an example of an electronic submittal.**
Please refer to this example of a complete Comfort Letter request.**
- Brownfields Comfort/Site Status Letter Request Form
- Brownfields Comfort/Site Status Letter Request Form (Word)
- Brownfields Comfort/Site Status Letter Supplemental Information Request Form
- Comfort/Site Status Letter Submittal Checklist
- Tabulated/Indexed Relevant Investigation/Remediation Reports Form
- Applicable Nonrule Policy Documents and Frequently Asked Questions
Brownfields Comfort/Site Status Letter Nonrule Policy Document
IDEM’s Property Containing Contaminated Aquifers Nonrule Policy Document
IDEM’s Property Containing Contaminated Aquifers/Underground Storage Tanks Nonrule Policy Document
All Appropriate Inquiries (AAI)
"All appropriate inquiries" or AAI is the process of evaluating a property's environmental conditions and assessing potential liability for any contamination. The Indiana Brownfields Program’s advice to all BFPPs, including prospective tenants, of potentially or known contaminated property is to conduct an AAI-compliant Phase I Environmental Site Assessment (Phase I ESA) prior to acquisition (EPA defines date of acquisition as the date on which a person acquires title to (or leases) the property.) Conducting a Phase I ESA for Testing and Materials (ASTM) Practice E-1527-21, Standard Practice for Environmental Site Assessment will ensure that you have the most information about potential or recognized environmental conditions on the property, as well as perhaps ensure your eligibility for an exemption from liability for any contamination on the property. The BFPP must provide answers to the user-specific questions to ensure its satisfaction of the Federal AAI rule.
The BFPP liability defense is self-implementing; if the applicant meets the pre-purchase statutory criteria and follows the post-acquisition continuing obligations, the applicant should be protected, regardless of whether it has obtained a letter from IDEM. Of course, such liability protection won’t be validated until and unless the BFPP is sued. A Comfort Letter also provides IDEM’s technical opinion on recommended reasonable steps regarding known environmental conditions on the Site in order to satisfy continuing obligations and maintain BFPP protection.
AAI-Compliant Phase I ESA Reports
Phase I ESA reports have two key expiration dates:
In order for a report to be valid for a property transfer, certain components of the Phase I ESA report cannot be older than 180 days. If more than 180 days has lapsed since the initial report information was collected prior to closing (from the earliest date collected/conducted) the following components of the Phase I ESA report must be updated prior to closing:
The shelf life of the Phase I ESA report is one year. If more than one year has lapsed from the date on which the earliest report information was collected prior to closing, an entirely new Phase I report must be obtained to qualify as a BFPP.
- Interviews with past and present owners, operators and occupants (40 CFR 312.23)
- Searches for recorded environmental cleanup liens (40 CFR 312.25)
- Reviews of federal, tribal, state and local government records (40 CFR 312.26)
- Visual inspections of the facility and adjoining properties (40 CFR 12.27)
- The declaration by the EP (40 CFR 312.21)
Phase I ESA BFPP User Information
The name of the entity (the User) for which the Phase I ESA report (and User Questionnaire) was completed needs to match the name of the entity that will be listed on the property deed (unless the party seeking protection is a prospective tenant, in which case it must match the entity identified in the lease agreement). If the Phase I ESA and User Questionnaire have already been completed for a different-named entity that will not be on the deed (or on a lease), the party seeking liability protection may be able to obtain a reliance letter for use of the report prior to acquisition/leasing and will have to complete a new User Questionnaire
ERC Modifications and Terminations
As site conditions and land use evolve, environmental guidance becomes more refined, and property changes hands, it may be necessary to evaluate recorded ERCs to ensure that the land use restrictions in place are appropriate and necessary. In accordance with Indiana Code 13-14-2-9(c)(3), an ERC may be modified if supporting information is provided. A request for an ERC modification or termination must be submitted in writing to the Program and include justification and supporting documentation sufficient to enable the Program to determine whether the proposed change(s) could increase the potential hazards to human health or the environment. The Program may request additional information from the owner of the Site, if necessary, prior to making such determination. The Program will apply current IDEM risk-based guidance (unless otherwise indicated in prior Program correspondence), evaluate recently collected data reflecting current environmental conditions on a Site, and any proposed change to land use to evaluate the appropriateness of an ERC modification or termination request.
Applicable U.S. Environmental Protection Agency Websites & Fact Sheets
U.S. EPA’s All Appropriate Inquiries Website
http://www.epa.gov/brownfields/brownfields-all-appropriate-inquiriesU.S. EPA’s Bona Fide Prospective Purchasers Website
http://www.epa.gov/enforcement/bona-fide-prospective-purchasersU.S. EPA’s All Appropriate Inquiry Fact Sheet
http://www.epa.gov/sites/production/files/2014-08/documents/aaifs.pdfU.S. EPA’s CERCLA, Brownfields, and Lender Liability Fact Sheet
http://www.epa.gov/sites/production/files/2015-09/documents/lenders_factsheet_1.pdf