Our Client’s Challenge
Our client is a municipality in the state of Oregon. The City sought to acquire a parcel of land located on North Front Street within the City limits to construct a parking structure to help facilitate the long-term development plans for the downtown area. The southern portion of the property was contaminated with diesel range hydrocarbons, polynuclear aromatic hydrocarbons (PAHs), polychlorinated biphenyls (PCBs), and a number of different metals. Development of the property would therefore require appropriate management and cleanup of the contaminated soils. To protect the City’s finances and risk, the City was unwilling to acquire the property unless it could address the potential liability for the contamination as part of the transaction.
We successfully negotiated a Consent Judgment with the Oregon Department of Environmental Quality and the Oregon Department of Justice which included a Prospective Purchaser Agreement (PPA) that addressed the City’s cleanup obligations regarding the contamination present at the site consistent with the City’s proposed use of the property. As a result of the PPA, the City was able to complete the transaction while at the same time obtaining a release from liability and covenant not to sue from DEQ upon satisfactory completion of the cleanup work the City agreed to perform, as well as contribution protection against potential future third-party claims. Acquisition of the property will allow the City to continue with its desired downtown redevelopment efforts.
Tags: Environmental and Natural Resources, Local Governments and Special Districts