BILL NUMBER: SB 493 AMENDED
BILL TEXT
AMENDED IN SENATE JANUARY 5, 2004
AMENDED IN SENATE MAY 15, 2003
AMENDED IN SENATE MAY 6, 2003
AMENDED IN SENATE MARCH 24, 2003
INTRODUCED BY Senator Cedillo
FEBRUARY 20, 2003
An act to add Chapter 6.9.1 (commencing with Section
25400.1) 6.82 (commencing with Section 25395.60)
to Division 20 of the Health and Safety Code, relating to hazardous
materials.
LEGISLATIVE COUNSEL'S DIGEST
SB 493, as amended, Cedillo. Hazardous materials: liability.
Existing law, the Carpenter-Presley-Tanner Hazardous Substance
Account Act, imposes liability for hazardous substances removal or
remedial actions.
Existing law, including the Porter-Cologne Water Quality Control
Act and the provisions regulating hazardous waste and releases from
underground storage tanks, impose various requirements with regard to
corrective action and cleanup and abatement, upon persons subject to
those acts.
This bill would enact the Brownfields
California Land Reuse and Revitalization Act of 2003
2004 , which would provide that for the
transfer of property concluded on or after January 1, 2005, an
innocent purchaser landowner or a bona
fide prospective purchaser, as defined, is not liable for
response cost or damage claims under specified state laws that
impose liability for response costs upon an owner
or occupant of property acquired on or after January 1, 2004
, for cleanup of preexisting pollution
conditions caused by a release of a hazardous material on, under, or
adjacent to that property . The bill would immunize an
innocent purchaser or bona fide prospective purchaser for response
costs associated with a release or threatened release of a hazardous
material at a site, as defined, if the innocent purchaser
or bona fide prospective purchaser meets specified conditions.
The bill would prohibit an agency, as defined, from requiring an
innocent landowner or bona fide prospective purchaser to take certain
response actions under those state laws, except as specified.
The bill would also prohibit an agency from requiring an owner
of contiguous property, who also owns a site, from requiring
additional response action, except under specified conditions. The
bill would provide that a person is not liable under those
specified state laws for response costs or other damages
associated with a release or threatened release of a
hazardous material from a site that is not owned by that person,
if the person owns real property that is contaminated
by a release from real property not owned by that person and the
person's real property is contiguous to, or otherwise similarly
situated with respect to, that site other
property and the person complies with additional specified
requirements. The bill would, if there are unrecovered response
costs incurred by a lead agency, as defined, at a site for which an
owner of the site is not liable as a bona fide prospective purchaser,
require the lead agency to have a lien on the site, or authorize the
lead agency to obtain from the owner a lien on other property or
other assurance of payment for the unrecovered response costs, as
specified.
This bill would authorize a court to require a nongovernment
entity to pay reasonable attorneys' and experts' fees to any party
that establishes that it is an innocent landowner, bona fide
prospective purchaser, or contiguous landowner, as defined in the act
or a specified federal act, in an action in which a claim is made
that the party is liable for response costs or other damages.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 6.9.1 (commencing with Section
SECTION 1. Chapter 6.82 (commencing with Section 25395.60) is
added to Division 20 of the Health and Safety Code, to read:
CHAPTER 6.82. CALIFORNIA LAND REUSE AND REVITALIZATION ACT OF
2004
Article 1. Legislative Findings and Intent
25395.60. The Legislature finds and declares all of the
following:
(a) There are thousands of properties in the state where
redevelopment has been stymied due to real or perceived hazardous
materials contamination. Cleaning up these sites and returning them
to productive use will benefit the communities in which they are
located and the state as a whole.
(b) Contamination of property in the state has hampered
redevelopment, which in turn has limited job creation, economic
revitalization, and the full and productive use of the land.
(c) Private developers, local governments, and schools are
reluctant to acquire or redevelop these properties due, at least in
part, to concerns regarding liability associated with historic
contamination. Instead, they focus new development on clean areas
that present less complications and liability.
(d) This has resulted in a multitude of problems, including urban
sprawl, decaying inner-city neighborhoods and schools, public health
and environmental risks stemming from contaminated properties, lack
of development at former manufacturing sites and rural areas in need
of economic investment, and reduced tax bases.
25395.61. It is the intent of the Legislature, in enacting this
chapter, to do all of the following:
(a) Establish the cleanup and reuse of these sites as a priority
of the state.
(b) Relieve innocent purchasers, bona fide prospective purchasers,
and owners of property adjacent to contaminated sites of liabilities
and responsibilities that should be borne by those who caused or
contributed to the contamination.
(c) Encourage process efficiencies that continue to ensure
cleanups are protective of public health.
(d) Encourage the development and redevelopment of unused or
underused properties.
25395.62. This chapter shall be known, and may be cited as, the
"California Land Reuse and Revitalization Act of 2004."
Article 2. Definitions
25395.63. The definitions set forth in this article shall govern
the interpretation of this chapter. Unless the context requires
otherwise and except as provided in this article, the definitions
contained in Article 2 (commencing with Section 25310) of Chapter 6.8
shall apply to the terms used in this chapter.
25395.64. "Agency" means any city, county, district, commission,
the state, or any department, agency, or political subdivision
thereof, that has jurisdiction under an applicable statute to
require, oversee, or approve a response action at a hazardous
materials release site.
25395.65. "All appropriate inquiries" means reasonable efforts,
in accordance with generally accepted good commercial and customary
standards and practices, to determine, through investigations into
the previous ownership and uses of the facility, whether a release of
a hazardous material or discharge of a waste has occurred. One or
more of the following activities shall be deemed to meet the standard
of "all appropriate inquiries":
(a) Compliance with the procedures of the American Society for
Testing and Materials, including the document known as "Standard
E1527-001," entitled "Standard Practice for Environmental Site
Assessment: Phase I Environmental Site Assessment Process," in the
form of the document current at the time of the inquiry.
(b) Compliance with the standards and practices established by the
Administrator of the United States Environmental Protection Agency
pursuant to Section 101(35)(B)(ii) of the federal act (42 U.S.C. Sec.
9601(35)(B)(ii)).
(c) For property in residential use or other similar use at the
time of purchase by a nongovernmental or noncommercial entity, a site
inspection and title search does not reveal a basis for further
investigation.
25395.66. "Applicable statute" means all of the following state
laws, but includes only those provisions in each state law that
impose liability on an owner or occupant of property for pollution
conditions caused by a release of hazardous material on, under, or
adjacent to the property:
(a) Title 1 (commencing with Section 3479) of, Title 2 (commencing
with Section 3490) of, and Title 3 (commencing with Section 3501)
of, Part 3 of Division 4 of the Civil Code.
(b) Chapter 3 (commencing with Section 731) of Title 10 of Part 2
of the Code of Civil Procedure.
(c) Section 5650 of the Fish and Game Code.
(d) Chapter 6.7 (commencing with Section 25280), Chapter 6.75
(commencing with Section 25299.10), Chapter 6.8 (commencing with
Section 25300), and Chapter 6.10 (commencing with Section 25401) of
this division.
(e) Division 7 (commencing with Section 13000) of the Water Code.
25395.67. (a) "Appropriate care" means the performance of a
response action, with respect to hazardous materials found at a site,
that meets all of the following conditions:
(1) The response action is determined by the department or
regional board, or a local health agency or certified unified program
agency with authority delegated by the state to oversee
investigation and remediation of hazardous materials, to be necessary
to address an endangerment to human health or the environment.
(2) The response action is performed in accordance with a written
plan approved by the department, regional board, local health agency,
or certified unified program agency.
(3) The approved plan includes a provision for oversight of the
response action by the department, regional board, local health
agency, or certified unified program agency.
(4) The response action is required to prevent an endangerment to
human health or the environment.
(b) "Appropriate care" does not include or require the same type
or extent of response action that would be required of a responsible
party.
(c) Upon the request of any party, the department, regional board,
local health agency, or certified unified program agency shall
acknowledge, in writing and within 60 days of the date of the
request, that proper completion of the approved plan specified in
paragraph (2) of subdivision (a) constitutes "appropriate care"
within the meaning of this chapter.
25395.68. "Board" means the State Water Resources Control Board.
25395.69. "Bona fide prospective purchaser" means a person, or a
tenant of a person, who acquires ownership of a site on or after
January 1, 2005, and who establishes all of the following by a
preponderance of the evidence:
(a) All releases of the hazardous materials at issue at the site
occurred before the person acquired the site.
(b) The person made all appropriate inquiries into the previous
ownership and uses of the site.
(c) The person provides all legally required notices with respect
to the discovery or release of hazardous materials at the site.
(d) The person exercises appropriate care with respect to the
release of the hazardous materials at the site.
(e) The person provides full cooperation, assistance, and access
to persons who are authorized to conduct response actions or natural
resource restoration at the site, including the cooperation, and any
access necessary for the installation, integrity, operation, and
maintenance of complete or partial response actions or natural
resource restoration at the site.
(f) The person is in compliance with land use controls established
or relied on in connection with an approved response action at the
site and does not impede the effectiveness or integrity of any aspect
of any remedy employed at the site in connection with a response
action.
(g) The person complies with all requests for information or
administrative subpoena concerning the release of hazardous materials
by any agency with jurisdiction under any applicable statute.
(h) The person is not potentially liable, or affiliated with any
other person who is potentially liable, for the release at issue
through any of the following circumstances:
(1) Any direct or indirect familial relationship.
(2) Any contractual, corporate, or financial relationship, unless
the contractual, corporate, or financial relationship is created by
the instrument by which title or possession to the site is conveyed
or financed or a contract for the sale of goods or services.
(3) The result of a reorganization of a business entity that was
potentially liable for the hazardous materials at issue.
25395.71. (a) "Site" means real property for which the expansion,
redevelopment, or reuse may be complicated by the presence or
perceived presence of hazardous materials.
(b) "Site" does not include either of the following:
(1) A facility that is listed or proposed for listing on the
National Priorities List established under Section 105 of the
Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended (42 U.S.C. Sec. 9605).
(2) A site on the list maintained by the department pursuant to
Section 25356.
25395.72. "Department" means the Department of Toxic Substances
Control.
25395.73. "Endangerment" means conditions at a site that do
either of the following:
(a) Pose an existing and significant risk to human health.
(b) Require an immediate response action to prevent serious
environmental damage.
25395.74. "Hazardous material" has the same meaning as defined in
subdivision (d) of Section 25260.
25395.75. (a) "Innocent landowner" means a person who takes the
actions specified in subdivision (b) and meets both of the following
conditions:
(1) The person is any one of the following:
(A) A person who made all appropriate inquiries into the previous
ownership and uses of the site and, at the time the person acquired
the property did not know and had no reason to know of the release at
issue.
(B) A government entity that acquired property by escheat, or
through any other involuntary transfer acquisition, or through the
exercise of eminent domain authority by purchase or condemnation.
(C) A person who acquired the property by inheritance or bequest.
(2) The person is not potentially liable, or affiliated with any
other person who is potentially liable, for the release at issue
through any of the following circumstances:
(A) Any direct or indirect familial relationship.
(B) Any contractual, corporate, or financial relationship, unless
the contractual, corporate, or financial relationship is created by
the instrument by which title or possession to the site is conveyed
or financed or a contract for the sale of goods or services.
(C) The result of a reorganization of a business entity that was
potentially liable for the hazardous materials at issue.
(b) The person takes all of the following actions:
(1) Exercises appropriate care with respect to the release of the
hazardous materials at the site.
(2) Provides full cooperation, assistance, and access to a person
who is authorized to conduct response actions or natural resource
restoration at the site, including the cooperation and any access
necessary for the installation, integrity, operation, and maintenance
of complete or partial response actions or natural resource
restoration at the site.
(3) Complies with land use controls established or relied on, in
connection with an approved response action at the site, and does not
impede the effectiveness or integrity of any aspect of any remedy
employed at the site in connection with a response action.
(4) Complies with all requests for information or administrative
subpoena concerning the release of hazardous materials by any agency
with jurisdiction under an applicable statute.
25395.76. "Land use control" means a recorded instrument that
restricts or imposes obligations on the present and future uses or
activities on a site, including, but not limited to, a recorded
easement, covenant, restriction, or servitude, or any combination
thereof, as appropriate.
25395.77. "Regional board" means a California regional water
quality control board.
25395.78. "Release" has the same meaning as defined in Section
25320.
25395.79. "Response," "respond," or "response action" have the
same meaning as defined in Section 25323.3, except that "response,"
"respond," and "response action" under this chapter apply to
hazardous material, as defined in Section 25395.74.
Article 3. Liability
25395.80. (a) Except as provided in Section 25395.85, an innocent
landowner who did not cause or contribute to the release at issue,
is subject to the following immunities:
(1) The innocent landowner is not liable under any applicable
statute for a claim made by any party that is not a government agency
for response costs or other damages associated with a release or
threatened release of a hazardous material at the site.
(2) Except as provided in subdivision (b), an agency may not take
any action under any applicable statute to require the innocent
landowner to conduct any response action with respect to a hazardous
materials release at a site owned by the innocent landowner unless
both of the following conditions apply:
(A) The agency does either of the following:
(i) Makes all reasonable attempts to compel any necessary response
action from all other potentially responsible parties, and those
efforts have been unsuccessful.
(ii) Reasonably determines that no viable potentially responsible
party exists to perform the required response action at the site.
(B) The conditions on the property pose an endangerment to human
health.
(b) This section does not modify or limit the existing authority
of a state or local agency to impose a condition on the issuance of a
discretionary permit relating to the development, use, or occupancy
of any site.
(c) The immunities described in this section shall attach upon
approval of the written plan described in paragraph (2) of
subdivision (a) of Section 25395.67 and shall continue as long as the
innocent landowner substantially complies with the provisions of the
approved plan. An innocent landowner shall be deemed to be out of
substantial compliance with the approved plan only when it has
received written notice from the appropriate agency of an unexcused
and material failure to comply with the approved plan. Written
confirmation from the appropriate agency that the innocent landowner
has satisfactorily implemented the approved plan conclusively
presumes substantial compliance.
(d) Any potentially responsible party that is found to have
committed fraud, intentional nondisclosure, or misrepresentation to
any state or local agency with authority over cleanup or remediation
at a site, is not an innocent landowner and is not entitled to
immunity against costs of response imposed by the department, board,
regional board, local health agency, or certified unified program
agency.
25395.81. (a) Except as provided in Section 25395.85, a bona fide
prospective purchaser who did not cause or contribute to the release
at issue is subject to the following immunities:
(1) The bona fide prospective purchaser is not liable under any
applicable statute for a claim made by any party that is not a
government agency for response costs or other damages associated with
a release or threatened release of a hazardous material at the site.
(2) Notwithstanding any other provision of law or authority under
which a bona fide prospective purchaser has exercised appropriate
care with respect to a hazardous materials release, and except as
provided in subdivision (b), an agency may not take any action under
any applicable statute to require the bona fide prospective purchaser
or a subsequent property owner to conduct any additional response
action with respect to a hazardous materials release at a site unless
both of the following conditions are met:
(A) The agency does one of the following:
(i) Makes all reasonable attempts to compel any necessary response
action from all other potentially responsible parties, and those
efforts have been unsuccessful.
(ii) Reasonably determines that no viable potentially responsible
party exists to perform the required response action at the site.
(B) The conditions on the property pose an endangerment to human
health.
(b) The immunities described in this section shall attach upon
approval of the written plan described in paragraph (2) of
subdivision (a) of Section 25395.67 and shall continue as long as the
bona fide prospective purchaser substantially complies with the
provisions of the approved plan. A bona fide prospective purchaser
shall be deemed to be out of substantial compliance with the approved
plan only when it has received written notice from the appropriate
agency of an unexcused and material failure to comply with the
approved plan. Written confirmation from the appropriate agency that
the bona fide prospective purchaser has satisfactorily implemented
the approved plan conclusively presumes substantial compliance.
(c) Any potentially responsible party that is found to have
committed fraud, intentional nondisclosure, or misrepresentation to
any state or local agency with authority over cleanup or remediation
at a site, is not a bona fide prospective purchaser and is not
entitled to immunity against costs of response imposed by the
department, board, regional board, local health agency, or certified
unified program agency.
(d) This section does not modify or limit the existing authority
of a state or local agency to impose a condition on the issuance of a
discretionary permit relating to the development, use, or occupancy
of any site.
25395.82. (a) Except as provided in Section 25395.85, an agency
may not take any action under any applicable statute to compel an
owner of contiguous property to conduct additional response action,
with respect to a hazardous materials release at a site owned by the
owner of the contiguous property, unless the owner meets all of the
requirements of subdivision (c) and both of the following conditions
are met:
(1) The agency does one of the following:
(A) Makes all reasonable attempts to compel any necessary response
action from all other potentially responsible parties, and those
efforts have been unsuccessful.
(B) Reasonably determines that no viable potentially responsible
party exists to perform the required response action at the site.
(2) The conditions on the property pose an endangerment to human
health.
(b) A person who owns real property that is contiguous to, or
otherwise similarly situated with respect to, and that is or may be,
contaminated by a release or threatened release of a hazardous
material from real property that is not owned by that person, is not
liable under any applicable statute for response costs or other
damages associated with the release or threatened release if the
person demonstrates, by a preponderance of the evidence, all of the
following:
(1) The person did not cause, contribute, or consent to the
release or threatened release.
(2) The person is not potentially liable, or affiliated with any
other person who is potentially liable, for the release at issue
through any of the following circumstances:
(A) Any direct or indirect familial relationship.
(B) Any contractual, corporate, or financial relationship, unless
the contractual, corporate, or financial relationship is created by
the instruments by which title or possession to the site is conveyed
or financed or a contract for the sale of goods or services.
(C) The result of a reorganization of a business entity that was
potentially liable for the hazardous materials at issue.
(c) To qualify for the release from liability described in
subdivisions (a) and (b), the owner of the contiguous property shall
do all of the following:
(1) Except as provided in subdivision (d), exercise appropriate
care with respect to the release of any hazardous materials at the
site.
(2) Provide full cooperation, assistance, and access to persons
who are authorized to conduct response actions or natural resource
restoration at the site from which there has been a release or
threatened release, including the cooperation and access necessary
for the installation, integrity, operation, and maintenance of a
complete or partial response action or natural resource restoration
at the site.
(3) Comply with any land use control established or relied on in
connection with the response action at the site, and does not impede
the effectiveness or integrity of any aspect of any remedy employed
in connection with a response action at the site.
(4) Comply with any request for information or administrative
subpoena issued by an agency with jurisdiction under an applicable
statute.
(5) Provide all legally required notices with respect to the
discovery or release of hazardous materials at the site.
(6) Have conducted all appropriate inquiry into the previous uses
and ownership of the site and, at the time of acquisition not know or
have reason to know that the site was or could be contaminated by
the release of hazardous materials from other real property not owned
or operated by the person.
(d) Paragraph (1) of subdivision (c) does not require a person to
conduct groundwater investigations or to install groundwater
remediation systems with respect to hazardous materials from a source
that is not on the property of the person who is a contiguous
property owner and that enters groundwater beneath the property of
the person solely as a result of subsurface migration.
(e) The immunities described in this section shall attach upon
approval of the written plan described in paragraph (2) of
subdivision (a) of Section 25395.67 and shall continue as long as the
owner of contiguous property substantially complies with the
provisions of the approved plan. An owner of contiguous property
shall be deemed to be out of substantial compliance with the approved
plan only when it has received written notice from the appropriate
agency of an unexcused and material failure to comply with the
approved plan. Written confirmation from the appropriate agency that
the owner of contiguous property has satisfactorily implemented the
approved plan conclusively presumes substantial compliance.
(f) Any potentially responsible party that is found to have
committed fraud, intentional nondisclosure, or misrepresentation to
any state or local agency with authority over cleanup or remediation
at a site, is not entitled to immunity against costs of response
imposed by the department, board, regional board, local health
agency, or certified unified program agency.
(g) This section does not limit a defense to liability that may be
available to the person under any other provision of state law, and
this section does not impose liability on the person that is not
otherwise imposed by an applicable statute.
(h) This section does not modify or limit the existing
authority of a state or local agency to impose a condition on the
issuance of a discretionary permit relating to the development, use,
or occupancy of a site.
25395.83. (a) The immunities and prohibitions imposed by Sections
25395.80, 25395.81, and 25395.82 shall become operative on January
1, 2005, and do not apply to any transfer of property concluded
before January 1, 2005.
(b) The immunities and prohibitions imposed by Sections 25395.80,
25395.81, and 25395.82 are in addition to, and do not otherwise
affect, any other protection provided under state law.
25395.84. If there are unrecovered costs incurred by a lead
agency at a site for which an owner of the site is not liable as a
bona fide prospective purchaser, the lead agency shall have a lien on
the site, or may, by agreement with the owner, obtain from the owner
a lien on other property or other assurance of payment for the
unrecovered response costs, subject to all of the following
requirements:
(a) A response action for which there are unrecovered costs of the
agency is carried out at the site.
(b) The response action increases the fair market value of the
site above the fair market value of the site that existed before the
response action was initiated.
(c) The lien arises at the time at which costs are first incurred
by the agency with respect to a response action at the site.
(d) The lien amount may not exceed the increase in fair market
value of the property attributable to the response action at the time
of a sale or other disposition of the property.
(e) The lien shall continue until the earlier of satisfaction of
the lien by sale or other means, or recovery of all response costs
incurred by the agency at the site.
(f) (1) The lien shall be subject to the rights of a purchaser,
holder of a security interest, or judgment lien creditor whose
interest is perfected under applicable state law before notice of the
lien has been filed in the appropriate office within the state or
county or other governmental subdivision, as designated by state law.
(2) The purchaser, holder of a security interest, or judgment lien
creditor has the same protections against the lien as the protection
provided by state law against a judgment lien that arises out of an
unsecured obligation and that arises as of the time of the filing of
the notice of the lien.
(3) The notice of the lien shall be recorded in the official
records of the County Recorder's office for the county in which the
real property is located.
(4) For purposes of this subdivision, the "purchaser" and
"security interest" have the same meaning as defined in subsection
(h) of Section 6323 of Title 26 of the United States Code.
25395.85. This chapter does not exempt any of the following:
(a) A person from liability for bodily injury or wrongful death.
(b) A person from any requirement imposed under Chapter 6.5
(commencing with Section 25100), including, but not limited to,
corrective action and closure and postclosure requirements.
25395.86. A court of competent jurisdiction may require any
nongovernment entity to pay reasonable attorneys' fees and experts'
fees to any party that establishes that it is an innocent landowner,
bona fide prospective purchaser, or contiguous landowner, as those
terms are defined in this chapter or used in the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C.
Sec. 9601 et seq.). A court may award such fees in any action in
which a claim is made that the innocent landowner, bona fide
prospective purchaser, or contiguous landowner is liable for response
costs or other damages associated with a release or threatened
release of the hazardous materials at issue at the site. The award
of fees shall be made upon notice and motion by the innocent
purchaser, bona fide prospective purchaser, or contiguous landowner
and shall be an element of the costs of suit.
25395.87. (a) This chapter does not limit any defense to
liability that may be available to a person under any other provision
of law or impose liability on a person that is not otherwise imposed
by this chapter or an applicable statute.
(b) This chapter does not limit the authority of an agency to
conduct any response action it determines is necessary to contain or
eliminate an endangerment that requires action to protect public
health and safety or the environment pursuant to an applicable
statute. 25400.1) is added to Division 20 of the
Health and Safety Code, to read:
CHAPTER 6.9.1. BROWNFIELDS REVITALIZATION ACT OF 2003
25400.1. (a) The Legislature finds and declares all of the
following:
(1) California's exploding population growth is putting stress on
the state's natural resources, infrastructure, and supply of useable
land.
(2) The state can promote and encourage more orderly and efficient
growth patterns by making urban and downtown areas more attractive
for private development and redevelopment, thereby relieving some of
those stresses on natural resources and making better use of existing
infrastructure.
(3) There are thousands of so-called brownfields and similar
tracts of land in California's urban areas that lie dormant, as
previous industrial and other uses have left them contaminated and
unusable.
(4) State law impedes the redevelopment of these properties by
imposing on innocent purchasers and bona fide prospective purchasers,
who are willing to invest in these properties to put them to
productive use, the same liability that state law imposes on the
original polluters.
(5) This liability, that is created simply by virtue of ownership
or occupancy, chills interest in acquiring and redeveloping these
properties, leaving private investors to pursue lower-risk properties
on the urban fringe.
(6) The result of this liability is increasingly abandoned urban
neighborhoods, lost tax revenue, and outward development patterns
that leads to further development of greenfield sites, while
contaminated urban sites lie unused or underused.
(7) It is the intent of this chapter to encourage acquisition of
these urban sites for purposes of development and redevelopment by
limiting the liability of innocent purchasers and bona fide
prospective purchasers for response actions when the innocent
purchasers and bona fide prospective purchasers have met the
requirements specified in this chapter.
(8) It is not the intent of this chapter to change or modify
existing state or local authority to require necessary and
appropriate response actions at the sites' subject to this chapter
based on the sites future intended land use, as a condition of
issuing discretionary permits relating to development, use, or
occupancy.
(9) Further, it is not the intent of this chapter to impair a
cause of action against a polluter responsible for creating a spill,
discharge, or presence of a hazardous material.
(b) This chapter shall be known, and may be cited as, the
"Brownfields Revitalization Act of 2003."
25400.5. For purposes of this chapter, the following terms have
the following meanings:
(a) "Applicable statute" means all of the following state laws, to
the extent that the state law imposes liability for response costs
on an owner or occupant of property acquired on or after January 1,
2004, for cleanup of preexisting pollution conditions caused by a
release of hazardous material on, under, or adjacent to the property:
(1) Title 1 (commencing with Section 3479) of, Title 2 (commencing
with Section 3490) of, and Title 3 (commencing with Section 3501)
of, Part 3 of Division 4 of the Civil Code.
(2) Chapter 3 (commencing with Section 731) of Title 10 of Part 2
of the Code of Civil Procedure.
(3) Section 5650 of the Fish and Game Code.
(4) Chapter 6.5 (commencing with Section 25100), Chapter 6.67
(commencing with Section 25270), Chapter 6.7 (commencing with Section
25280), Chapter 6.75 (commencing with Section 25299.10), Chapter 6.8
(commencing with Section 25300) and Chapter 6.10 (commencing with
Section 25401).
(5) Article 12.5 (commencing with Section 33459) of Chapter 4 of
Part 1 of Division 24 of the Health and Safety Code.
(6) Division 7 (commencing with Section 13000) of the Water Code.
(b) "Bona fide prospective purchaser" means a person or a tenant
of a person who acquires ownership of a site on or after January 1,
2004, and that establishes all of the following by a preponderance of
the evidence:
(1) All disposal of hazardous materials at the site occurred
before the person acquired the site.
(2) The person made all appropriate inquiries into the previous
ownership and uses of the site in accordance with generally accepted
good commercial and customary standards and practices. One or more
of the following shall satisfy the "all appropriate inquiries"
requirement:
(A) Compliance with the procedures of the American Society for
Testing and Materials, including the document known as "Standard
E1527-001," entitled "Standard Practice for Environmental Site
Assessment: Phase I Environmental Site Assessment Process," in the
form of the document current at the time of the inquiry.
(B) Compliance with the standards and practices established by the
Administrator of the United States Environmental Protection Agency
pursuant to Section 9601(35)(B)(ii) of Title 42 of the United States
Code.
(C) In the case of property in residential or other similar use at
the time of purchase by a nongovernmental or noncommercial entity, a
site inspection and title search that does not reveal a basis for
further investigation.
(3) The person provides all legally required notices with respect
to the discovery or release of hazardous materials at the site.
(4) The person exercises appropriate care with respect to
hazardous materials found at the site by taking reasonable steps to
stop continuing release, prevent threatened future release, and
prevent or limit human, environmental, or natural resource exposure
to previously released hazardous material.
(5) The person provides full cooperation, assistance, and access
to persons who are authorized to conduct response actions or natural
resource restoration at a site, including the cooperation and access
necessary for the installation, integrity, operation, and maintenance
of complete or partial response actions or natural resource
restoration at the site.
(6) The person is in compliance with land use restrictions
established or relied on in connection with the response action at a
site and does not impede the effectiveness or integrity of
institutional control employed at the site in connection with a
response action.
(7) The person complies with all requests for information or
administrative subpoena issued by the lead agency under this chapter.
(8) The person is not potentially liable, or affiliated with any
other person who is potentially liable, for response costs at a site
through direct or indirect familial relationship, or contractual,
corporate, or financial relationship, other than a contractual,
corporate, or financial relationship that is created by the
instruments by which title to the site is conveyed or financed or by
a contract for the sale of goods or services, or the result of a
reorganization of a business entity that was potentially liable.
(c) (1) "Contractual relationship" includes, but is not limited
to, a relationship based on a land contract, deed, easement, lease,
or other instrument transferring title or possession, unless the site
was acquired by an innocent purchaser after the disposal or
placement of the hazardous material on, in, or at the site, and the
person meets the conditions specified in paragraph (2) and
establishes one or more of following by a preponderance of the
evidence:
(A) At the time the person acquired the site, the person did not
know and did not have reason to know, that hazardous material that is
the subject of the release or threatened release was disposed of on,
in, or at the site, as provided in paragraph (3).
(B) The person is a government entity that acquired the site by
escheat, or through any other involuntary transfer or acquisition, or
through the exercise of eminent domain authority by purchase or
condemnation.
(C) The person acquired the site by inheritance or bequest.
(2) The person establishes all of the following:
(A) The person is an innocent purchaser.
(B) The person provides full cooperation, assistance, and site
access to the persons that are authorized to conduct response actions
at the site, including the cooperation and access necessary for the
installation, integrity, operation, and maintenance of a complete or
partial response action at the site.
(C) The person is in compliance with land use restrictions
established or relied on in connection with the response action at a
site.
(D) The person does not impede the effectiveness or integrity of
institutional control employed at the site in connection with a
response action.
(3) To establish that, at the time the person acquired the site,
the person did not know and did not have reason to know that
hazardous material that is the subject of the release or threatened
release was disposed of on, in, or at the site, the person shall
demonstrate all of the following by a preponderance of the evidence:
(A) On or before the date on which the person acquired the site,
the person carried out all appropriate inquiries into the previous
ownership and uses of the site in accordance with generally accepted
good commercial and customary standards and practices.
(B) The person took reasonable steps to stop continuing release,
prevent threatened future release, and prevent or limit human,
environmental, or natural resource exposure to previously released
hazardous material.
(C) In the case of property for residential use or other similar
use purchased by a nongovernmental or noncommercial entity, a site
inspection and title search that did not reveal a basis for further
investigation shall satisfy the requirements of this paragraph.
(4) Nothing in this section diminishes the liability of a previous
owner or operator of a site who would otherwise be liable for the
release of hazardous materials. Notwithstanding this paragraph, if
the person obtains actual knowledge of the release or threatened
release of hazardous materials at a site when the person owned the
real property and then subsequently transferred ownership of the
property to another person without disclosing that knowledge, the
person who fails to make that disclosure is not entitled to a defense
under Section 25400.6.
(5) Nothing in this section affects the liability of a person who,
by an act or omission, causes or contributes to the release or
threatened release of a hazardous material that is the subject of the
action relating to the site.
(d) "Innocent purchaser" means a person who can establish all of
the following by a preponderance of the evidence:
(1) The release or threatened release of a hazardous material and
the damages resulting therefrom were caused solely by an act or
omission of a third party, other than an employee or agent of the
person, other than one whose act or omission occurs in connection
with a contractual relationship, existing directly or indirectly,
with the person, except where the sole contractual arrangement arises
from a published tariff and acceptance for carriage by a common
carrier by rail.
(2) He or she exercised due care with respect to the hazardous
material concerned, taking into consideration the characteristics of
the hazardous material, in light of all relevant facts and
circumstances.
(3) He or she took precautions against foreseeable acts or
omissions of a third party and the consequences that could
foreseeably result from those acts or omissions.
(e) "Hazardous material" has the same meaning as defined in
paragraph (8) of subdivision (a) of Section 25395.20.
(f) "Lead agency" means the agency that exercises primary
environmental oversight authority over remediation of a site and
incurs response costs for the site. If there is more than one
potential lead agency, an agency may request and be designated as the
administering agency by the Site Designation Committee applying the
factors set forth in subdivision (c) of Section 25262, and that
administering agency shall be deemed to be the lead agency for
purposes of this chapter.
(g) "Response" includes a response action as defined in Section
25323.3, or a response under any other applicable statute.
(h) (1) Subject to paragraph (2), "site" means an area that meets
both of the following conditions:
(A) It is located in an urban area, as defined in paragraph (3).
(B) It was previously the site of an economic activity that is no
longer in operation at that location as defined in paragraph (12) of
subdivision (a) of Section 25395.20.
(2) "Site" does not include any of the following:
(A) Property listed, or proposed for listing, on the National
Priorities List pursuant to the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 (42 U.S.C. Sec. 9605(a)(8)
(B)).
(B) Property that is, or was, owned or operated by a department,
agency, or instrumentality of the United States.
(C) Property that will be the site of a contiguous expansion or
improvement of an operating industrial or commercial facility, unless
one of the following applies:
(i) It is a small business, as defined in paragraph (15) of
subdivision (a) of Section 25395.20.
(ii) It is a nonprofit corporation formed under the Nonprofit
Public Benefit Corporation Law (Part 2 (commencing with Section 5110)
of Division 2 of Title 1 of the Corporations Code) or the Nonprofit
Religious Corporation Law (Part 4 (commencing with Section 9110) of
Division 2 of Title 1 of the Corporations Code).
(iii) It is a small business incubator that is undertaking the
expansion with the assistance of a grant authorized by Section
15339.3 of the Government Code or a loan guarantee provided pursuant
to Section 14090 of the Corporations Code.
(3) For purposes of paragraph (1), "urban area" means either of
the following:
(A) The central portion of a city or a group of contiguous cities
with a population of 50,000 or more, together with adjacent densely
populated areas having a population density of at least 1,000 persons
per square mile.
(B) An urbanized area as defined in subdivision (a) of, or
subparagraph (A) of paragraph (1) of subdivision (b) of, Section
21071 of the Public Resources Code.
25400.6. (a) An innocent purchaser or a bona fide prospective
purchaser is not liable under an applicable statute for response
costs associated with a release or threatened release of a hazardous
material at a site.
(b) This section does not modify or limit the existing authority
of a state or local agency to impose a condition on the issuance of a
discretionary permit relating to the development, use, or occupancy
of any site.
25400.7. (a) A person is not liable under an applicable statute
for response costs associated with a release or threatened release of
a hazardous material from a site that is not owned by that person,
if the person demonstrates, by a preponderance of the evidence, that
both of the following apply:
(1) The person owns real property that is contiguous to, or
otherwise similarly situated with respect to, the site, and the real
property owned by that person is, or may be, contaminated by a
release or threatened release from the site.
(2) The person demonstrates by a preponderance of the evidence all
of the following:
(A) The person did not cause, contribute, or consent to the
release or threatened release.
(B) The person is not potentially liable, or affiliated with a
person who is potentially liable, for response costs at a site
through one or more of the following:
(i) A direct or indirect familial relationship.
(ii) A contractual, corporate, or financial relationship, other
than a contractual, corporate, or financial relationship that is
created by a contract for the sale of goods or services.
(iii) A reorganization of a business entity that was potentially
liable.
(C) The person takes reasonable steps to stop a continuing
release, prevent threatened future release, and prevent or limit
human, environmental, or natural resource exposure to hazardous
material released on or from property owned by that person.
(D) The person provides full cooperation, assistance, and access
to persons who are authorized to conduct response actions or natural
resource restoration at the site from which there has been a release
or threatened release, including the cooperation and access necessary
for the installation, integrity, operation, and maintenance of a
complete or partial response action or natural resource restoration
at the site.
(E) The person is in compliance with land use restrictions
established or relied on in connection with the response action at
the site, and does not impede the effectiveness or integrity of
institutional control employed in connection with a response action.
(F) The person is in compliance with any request for information
or administrative subpoena issued by the lead agency.
(G) The person provides all legally required notices with respect
to the discovery or release of hazardous materials at the site.
(H) At the time the person acquired the property, the person
conducted all appropriate inquiry with respect to the property and
did not know or have reason to know that the property was or could be
contaminated by a release or threatened release of hazardous
material from other real property not owned or operated by the
person.
A person who knew or had reason to know at the time of acquisition
that the property was or could be contaminated by a release or
threatened release of a hazardous material from other real property
not owned or operated by the person may nevertheless qualify as a
bona fide prospective purchaser if he or she meets the requirements
of subdivision (b) of Section 25400.5.
(b) With respect to a hazardous material from one or more sources
that are not on the property of a person who is a contiguous property
owner that enters groundwater beneath the property of the person
solely as a result of subsurface migration in an aquifer,
subparagraph (C) of paragraph (2) of subdivision (a) does not require
the person to conduct groundwater investigations or to install
groundwater remediation systems, except in accordance with Management
Memo #90-11 issued by the Department of Toxic Substances Control
titled "RP-Ownership of Property Over Contaminated Groundwater."
(c) This section does not limit a defense to liability that may be
available to the person under any other provision of state law, and
this section does not impose liability on the person that is not
otherwise imposed by an applicable statute.
(d) This section does not modify
or limit the existing authority of a state or local agency to impose
a condition on the issuance of a discretionary permit relating to the
development, use, or occupancy of a site.
25400.8. The protections provided in Sections 25400.6 and 25400.7
are in addition to, and do not otherwise affect, other protections
provided under state law.
25400.9. If there are unrecovered response costs incurred by a
lead agency at a site for which an owner of the site is not liable as
a bona fide prospective purchaser, the lead agency shall have a lien
on the site, or may by agreement with the owner, obtain from the
owner a lien on other property or other assurance of payment for the
unrecovered response costs, subject to all of the following:
(a) A response action for which there are unrecovered costs of the
lead agency is carried out at the site.
(b) The response action increases the fair market value of the
site above the fair market value of the site that existed before the
response action was initiated.
(c) The lien shall arise at the time at which costs are first
incurred by the lead agency with respect to a response action at the
site.
(d) The lien amount may not exceed the increase in fair market
value of the property attributable to the response action at the time
of a sale or other disposition of the property.
(e) The lien shall continue until the earlier of satisfaction of
the lien by sale or other means, or recovery of all response costs
incurred by the lead agency at the site.
(f) The lien shall be subject to the rights of a purchaser, holder
of a security interest, or judgment lien creditor whose interest is
perfected under applicable state law before notice of the lien has
been filed in the appropriate office within the state or county or
other governmental subdivision, as designated by state law. That
purchaser, holder of a security interest, or judgment lien creditor
shall be afforded the same protections against the lien as are
afforded under state law against a judgment lien that arises out of
an unsecured obligation and that arises as of the time of the filing
of the notice of the lien. The notice shall be recorded in the
official records of the County Recorder's office for the county in
which the real property is located. For purposes of this
subdivision, the terms "purchaser" and "security interest" shall have
the definitions provided under Section 6323(h) of Title 26 of the
United States Code.
25400.10. Sections 24500.6 and 25400.7 do not exempt a person
from liability for bodily injury or wrongful death, and do not exempt
a permitted past, present, or future owner or operator of a
hazardous waste facility, as defined in Section 25117.1, from what is
required to obtain a hazardous waste facilities permit pursuant to
Chapter 20 (commencing with Section 66270.1) of Division 4.5 of Title
22 of the California Code of Regulations, or from the corrective
action, closure, and postclosure requirements set forth in Chapter
6.5 (commencing with Section 25100).
25400.11. Sections 25400.6 and 25400.7 are not intended to, and
may not be interpreted to, limit the state's authority, to the extent
that Chapter 6.5 (commencing with Section 25100) would not comply
with the requirements for obtaining approval and authorization under
Part 271 (commencing with Section 271.1) of Title 40 of the Code of
Federal Regulations.