The Brownfields Utilization, Investment and Local Development (BUILD) Act was enacted on March 23 as part of the Consolidated Appropriations Act of 2018. The BUILD Act provides additional protections and enticements for brownfield redevelopments while prioritizing the development of renewable energy and energy-efficient projects. While there are some notable updates to the U.S. Environmental Protection Agency’s (EPA) existing Brownfields program, all of which are meant to encourage development of environmentally contaminated properties, the BUILD Act does not significantly alter the landscape for companies or individuals operating, purchasing or leasing contaminated properties.

  • Petroleum Brownfield Enhancement. Section 3 of the BUILD Act removes a hurdle for brownfield sites with petroleum contamination by allowing grants to assess and clean up petroleum contaminated sites that are not required to be remediated under other programs such as those for hazardous waste.
  • Lessees as Bona Fide Prospective Purchasers. Section 5 of the BUILD Act clarifies the definition of a bona fide prospective purchaser to include lessees of property who entered into a lease after Jan. 1, 2002, and who otherwise meet the requirements for the bona fide prospective purchaser defense. Although the BUILD Act provides clarity toward lessees, it was previously expected that lessees could qualify as bona fide prospective purchasers, so this is not a significant change.
  • Expanded Eligibility for Nonprofit Organizations. Section 6 of the BUILD Act authorizes brownfield revitalization funding for nonprofit organizations, including nonprofit limited liability companies and community development organizations. In addition, publicly owned sites acquired prior to 2002 may apply for assessment and remediation grants even if such public entity does not qualify as a bona fide prospective purchaser, but only if the entity is not responsible for the contamination.
  • Increased Funding for Remediation Grants and Multipurpose Grants. The BUILD Act also increased the cleanup grant funding amount from $200,000 to $500,000 per site, and eligible entities may request a waiver to obtain $650,000 per site based on the anticipated level of contamination and size of the site. The BUILD Act eliminates the current prohibition on administrative costs and allows grant recipients to use up to 5 percent of grant awards on administrative costs. Section 9 of the BUILD Act authorizes cleanup and assessment combination grants of up to $1 million.
  • New Ranking Criteria. Section 11 of the BUILD Act adds several new ranking criteria focusing on renewable energy, energy efficient projects and revitalization of waterfront property, all of which will now be considered in evaluating grant applications.
  • Brownfields Funding and Technical Assistance Grants. The BUILD Act nearly doubles the annual funding previously available to $200 million and authorizes a new grant program for states and tribes to provide training, technical assistance and research for small communities (less than 15,000 population), Indian tribes, rural areas and disadvantaged areas (maximum of $20,000 per community).

From a risk management perspective, the BUILD Act does not fundamentally alter the liability protections under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), but simply expands the universe of who may assert these protections. Instead, the original bona fide prospective purchaser provision from 2002 continues to shape liability protections.

Bona Fide Prospective Purchaser