Ohio House Introduces Brownfield Regulatory Reform Legislation (HB 737)

By Aaron Clapper, GOPC Project Manager

State Representative Steven Arndt (R – Port Clinton), with co-sponsors Rep. Seitz (R – Cincinnati) and Rep. Johnson (R – McDermott), introduced HB 737, which is brownfield regulatory reform legislation that Greater Ohio Policy Center helped to champion. HB 737 would provide an alternative to the Voluntary Action Program (VAP) liability protection in Ohio’s law as a means to encourage brownfield redevelopment in the state. Since the sunset of the CORF program, brownfields redevelopment is down in Ohio. HB 737 creates an easier path to brownfield development by bringing Ohio state law in line with federal guidelines related to the Bona Fide Prospective Purchaser (BFPP) Defense.

HB 737 incorporates into Ohio law the federal Bona Fide Prospective Purchaser (BFPP) defense established under CERCLA (CERCLA is the federal program created to regulate and handle Superfund sites). In 2002, Congress created the BFPP defense as an amendment to CERCLA to encourage brownfield redevelopment. By adding an alternative to Ohio’s Voluntary Action Program (VAP), HB 737 provides prospective buyers of contaminated property with an option to establish a defense to environmental liability after completing the All Appropriate Inquires and proper due diligence, as outlined in CERCLA’s BFPP defense.

HB 737 would fill the gap in brownfields redevelopment by aligning Ohio law with the federal BFPP defense. The BFPP defense offers a much more cost-effective means to putting brownfields into productive use because the BFPP defense does not require a full-blown assessment and clean-up of a prospective property. By strengthening protections under the BFPP Defense, buyers will have a greater incentive to reutilize brownfields in Ohio. In replicating the BFPP defense into Ohio law, Ohio would be in line with many other states, such as Indiana and Michigan, which have incorporated the BFPP defense or BFPP defense-like legal protection into state law. Michigan’s Baseline Environmental Assessment (BEA) program, similar to the BFPP defense, averaged 1,032 issuances per year between 1995 and 2015, while Ohio’s current VAP Covenant-not-to-Sue (CNS) averaged 26 per year during that same time period.

Brownfield redevelopment continues to be a top policy priority for Greater Ohio Policy Center. Public and private sector stakeholders agree that communities across Ohio can recognize the economic potential of brownfields revitalization through a combination of regulatory reform and the establishment of a sustained, community-responsive funding program, similar to the Clean Ohio Revitalization Fund (CORF). Earlier this month, Greater Ohio released a white paper on potential funding sources.

To learn more about the background of HB 737, please visit this blogpost written by Joe Koncelik on the Ohio Environmental Law Blog. GOPC will continue to provide updates on HB 737 as it moves through the legislature.