Florida Real Estate Brokers Guide Sixth Edition Linda

Unit 17 Environmental Concerns Affecting Real Estate Transactions

CERCLA • Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) – Respond to release of hazardous substances – Liability for cleanup • Established Superfund to finance emergency response and cleanup costs • Program is administered by the EPA © 2017 Kaplan, Inc.

Potentially Responsible Person (PRP) • Liability for responsible parties • Present owners and operators • Past owners and operators of site when hazardous substances were on-site • Generators of hazardous substances • Transporters of hazardous substances to the site © 2017 Kaplan, Inc.

Liability Under CERCLA • Strict liability – Potential responsible persons (PRPs) are liable • Joint and several liability – One PRP or any group of PRPs may be held responsible for all cleanup costs © 2017 Kaplan, Inc.

Superfund Amendments and Reauthorization Act (SARA) • Innocent Landowner Defense • Pollution was caused by a third party; someone other than the current owner • Did not know property was contaminated when purchased • Reacted responsibly upon discovery of contamination • Make reasonable inquiries before purchase © 2017 Kaplan, Inc.

National Priorities List (NPL) • Maintained by EPA • List of sites that warrant remedial action – Determine which sites warrant further investigation – Identify what CERCLA-financed remedial actions may be appropriate – Notify the public of sites the EPA believes warrant further investigation – Notify potentially responsible parties that the EPA may initiate CERCLA-financed remediation © 2017 Kaplan, Inc.

Brownfields Legislation • Sites that the expansion, redevelopment, or reuse of may be complicated by the presence of contamination • Small Business Liability Relief and Brownfields Revitalization Act – Enables contaminated industrial and commercial properties to become economically viable through relief from liability for past contamination © 2017 Kaplan, Inc.

Environmental Due Diligence • Environmental site assessment – Phase I assessment • • • Study of past uses and records concerning site Physical inspection Review of procedures and safeguards Analysis of aerial photos and building records Review of scientific reports – Phase II assessment • Field testing and analysis – Phase III assessment • Complex soil, water, and air quality analysis © 2017 Kaplan, Inc.

Asbestos • Used as building insulation and fire retardant prior to 1978 • Federal and state regulation – DBPR licenses and regulates asbestos contractors and consultants • EPA recommends Phase I assessment – Signs of deterioration – Encapsulation vs. removal © 2017 Kaplan, Inc.

Radon Gas • Naturally occurring radioactive gas – May cause cancer • Testing only way to determine if radon levels exceed guidelines – Radon gas mitigation for homes that exceed guidelines • Florida Radon disclosure statement in sale contracts and leases © 2017 Kaplan, Inc.

Lead-Based Paint • Residential Lead-Based Paint Hazard Reduction Act – Enforced by HUD and

Lead-Based Paint Required Disclosures • Seller – Give buyer EPA pamphlet – Give buyer 10 days to conduct testing – Disclose known leadbased paint hazards – Include warning language in contract © 2017 Kaplan, Inc. • Landlord – Give tenant EPA pamphlet – Disclose known leadbased paint hazards – Include warning language in lease – Sign statement verifying completion • Retain for 3 years

Licensee Requirements • Inform sellers and landlords of how to comply – Certify in writing that licensee has made seller/landlord aware of legal obligations • Comply with law even if seller/landlord does not comply © 2017 Kaplan, Inc.

Exceptions to Lead-Based Paint Law • • Housing built after 1977 Commercial facilities Zero-bedroom units Leases for 100 days or less – If tenant does not have ability to renew the lease • Designated housing for elderly and handicapped – With no children under age six living there © 2017 Kaplan, Inc.