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Proposed HDSRF Changes Reduce Available Remediation Funds

Posted on November 8th, 2016

The New Jersey State Assembly is considering changes to the Hazardous Discharge Site Remediation Fund (HDSRF) that, if enacted, will reduce the availability of funding to municipalities, counties, redevelopment entities, Brownfield Development Areas and recreation/conservation projects.  These proposed changes are found in Assembly bill A-1954.

Assembly bill A-1954 moved from the Environment and Solid Waste Committee to the full Assembly on October 27th.  A copy of the bill and summary statement may be accessed at the NJ Legislature web site, found at https://www.njleg.state.nj.us/.

This proposal reduces the amount of grant funding available to municipalities, counties and redevelopment entities to remediate contaminated properties that are scheduled for redevelopment from $3 million to $2 million a year.  It reduces the additional amount available to Brownfield Development Areas from $2 million to $1 million a year, and places caps on the funding available for each remedial phase and for each site.

Remediation funding for park development is always difficult.  It is not an eligible expense under the State Green Acres Program.  One of the most significant reductions in A-1954 is the funding for conservation and recreation projects, from 75% to 50% of Remedial Action costs.  Under A-1954, remediation funding for conservation and recreation projects would be capped at $500,000 a year.

In addition to the reductions in funding, A-1954 also proposes changes that may free up encumbered funds from stalled projects.  Preliminary Assessments and Site Investigations must be completed within two and three years of award, respectively, or the grant is cancelled.  In addition, no grant will be approved until the applicant demonstrates that it has expended or will expend the full amount of any previous grant for the same property.

A comparison between the existing HDSRF Program and the proposed changes is found on the chart below.  We hope you find this useful.

 

Current Provisions Proposed Changes
Municipalities, Counties & Redevelopment Entities 100% of PA/SI/RI, $3,000,000 a year cap 100% of PA/SI/Ri, $2,000,000 a year cap
Municipalities, Counties & Redevelopment Entities Cap of $750,000 for any one site
Municipalities, Counties & Redevelopment Entities Additional $2,000,000 a year for BDA Sites ($5,000,000 a year total) Additional $1,000,000 a year for BDA Sites ($3,000,000 a year total)
Municipalities, Counties & Redevelopment Entities BDA Sites – No individual site cap for Remedial Action funding BDA Sites – $750,000 Remedial Action funding cap for any one site
Municipalities, Counties & Redevelopment Entities 75% of Remedial Action costs for recreation or conservation, $5,000,000 a year cap 50% of Remedial Action costs for recreation or conservation, $500,000 a year cap
Municipalities, Counties & Redevelopment Entities 100% PA/SI/RI All Environmental Media PA & SI (100%, Soil Contamination only) $30,000 cap/site
RI (100%, Soil Contamination only) $100,000 cap/site
PA & SI (100%, All Media) $75,000 cap/site
RI (100%, All Media) $250,000 cap/site
Innocent Party [NJSA 58:10B-6(a)(4)] $1,000,000 per project cap $100,000 a year cap, $500,000 per project cap
Qualifying Persons $1,000,000 annual cap $500,000 annual cap
Qualifying Persons 25% project costs of the remediation that is specifically for the use of innovative technology, implementation of limited restricted or unrestricted use, remediation in an EOZ or those who voluntarily remediate if not otherwise eligible. $250,000 project cap These costs are no longer eligible for HDSRF funding.
  1. PA/SI must be completed in 2 years of award & RI must be completed within 3 years of award or grant is cancelled
  2. At least 25% of HDSRF for use in BDA of which 5% must be used for PA/SI/RI
  3. At least 30% of HDSRF for PA/SI/RI use on sites outside BDA
  4. No award would be approved until the applicant demonstrates to the satisfaction of the EDA that it has expended or will expend the full amount of any previous financial assistance or grant awarded to the applicant for the same property.
  5. Requires EDA to adopt criteria, which must be met by a municipality, county, or redevelopment entity that applies for a grant, that the subject real property be developed within a three-year period from completion of the remediation.
  6. Proposed Funding Priority:
    1. Sites on which there has been a discharge and the discharge poses an imminent and significant threat to a drinking water source, to human health, or to a sensitive or significant ecological area
    2. Sites that are owned by a municipality in a brownfield development area where the developer is a public entity
    3. Sites in areas designated as Planning Area 1 (Metropolitan) and Planning Area 2 (Suburban) pursuant to the “State Planning Act.”

Stephen Kehayes

Senior Manager


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