Cuomo Budget Proposal Threatens Brownfield Cleanup Program

March 22, 2018

Tucked into the fiscal year 2019 budget released on January 16 by Governor Andrew M. Cuomo is a proposal that, if adopted by the legislature, could have a devastating effect on the state’s brownfield cleanup program (BCP).

The governor is proposing to defer brownfield tax credits (as well as a variety of other tax credits, such as the historic tax credit) for three years to the extent a particular credit for a taxpayer exceeds $2 million. If enacted into law as part of the budget package, the change would affect brownfield projects now in progress – even though they had been promised tax credits and undoubtedly had relied on them.

Moreover, it very well could hamper enthusiasm about the BCP well into the future because it would throw the economics of brownfield cleanups – and the state’s willingness to support the BCP – into question. The proposal is of even greater concern now than it might otherwise have been because the state’s Voluntary Cleanup Program (VCP), discussed on the website of the New York State Department of Environmental Conservation (NYSDEC) at https://www.dec.ny.gov/chemical/8442.html, is terminating on March 31. Sites in the VCP can apply to transition into the BCP.

At least two state senators from the western part of New York, Chris Jacobs and Robert Ortt, and other interested parties are attempting to shed light on the proposal, and whether the legislature ultimately decides to approve the idea remains to be seen. This column briefly explores the tax credits available under the BCP; reviews an idea similar to the governor’s current proposal that became law in 2010, during the Great Recession, and the legal battle that resulted; and discusses the current proposal

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Charlotte A. Biblow, a partner in the environmental, land use and municipal law and litigation departments of Farrell Fritz, can be reached at cbiblow@farrellfritz.com.

Reprinted with permission from New York Law Journal, March 2018.

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  • Related Practice Areas: Commercial Litigation, Environmental, Land Use & Municipal
  • Publications: New York Law Journal