By Oriana Montani, originally published in Buffalo Business First on 12/2/16.

What you need to know about environmental easements

An Environmental Easement, or EE, is generally required by the New York State Department of Environmental Conservation for sites in the state Superfund and Brownfield Cleanup programs where there are ongoing institutional and/or engineering controls included as part of a remedy for the site. The EE is granted by the property owner of the site in favor of the NYSDEC.

Often one of the final remedial measures required by the DEC as a precursor to obtaining a certificate of completion and/or release of liability, submission of the EE package, which includes the easement agreement, survey, title and other documents, is a significant milestone that has proven daunting to remedial parties and practitioners alike.

Five things to consider when preparing an EE:

Use an attorney

Use an attorney to put the package together. It is apparently what the DEC intended when creating the EE process.

The EE checklist has an attorney certification wherein the attorney who prepared the easement package must attest to the easement package’s truth and completeness, indicating that “certification was prepared by [the attorney] or under [the attorney’s] supervision and direction; and that information provided on [the EE checklist] form and its attachments is true and complete to the best of [the attorney’s] knowledge and belief.”

Also, use an attorney with a background in real estate law. Remedial parties are often inclined to use an environmental attorney to complete the EE package. Using an environmental attorney is fine, however the attorney should have a real estate background or real estate acumen as well.

The preparation of the EE package requires survey reading, familiarity with tax maps and title analysis. Know that you are preparing an EE that is going to be reviewed by a real estate attorney resident in the NYSDEC for the specific purpose of drafting EE agreements and reviewing and approving EE packages.

The survey

Be extremely mindful of the legal description(s). The survey checklist requires that if the deed and measured legal descriptions are different, you must include both on the face of the EE survey. This discrepancy can occur in two different circumstances.

First, this occurs where the property subject to the DEC remedial project is a portion of a larger parcel. Second, this can occur when there are variations in the deed measurements and the surveyor’s measurements. In either situation, the DEC would require that both legal descriptions be included on the face of the survey.

Next, re-review the full DEC survey checklist when you receive a revised survey from the surveyor. The checklist sets forth a set of nuanced requirements that the EE survey must meet. Because of these nuances, there are often multiple iterations of the EE survey and a lot of back and forth between the surveyor and the practitioner.

Rather than reviewing the revised survey for the specific issue identified to the surveyor, it is best practice to review the revised survey against the full survey checklist to ensure that any requested revisions were properly incorporated into the most current version of the survey.

Create a dialogue with NYSDEC early

Not all EEs are created equal. Some are very straightforward while others are complex or contemplate a more unique set of facts. The EE checklist includes a list of “Special Circumstances.”

This list includes scenarios where the property subject to the easement was acquired by the current owner by quit claim deed or any other restricted transfer deed, a property subject to a Brownfield Cleanup Agreement which includes lands underwater and/or a property that has multiple owners.

I would add to this list: where the property subject to the EE is owned by a third party. That is to say that the property owner, the party with the legal right and authority to grant the EE to the DEC is not the remedial party.

These third-party scenarios can be challenging situations and can halt progress on the EE and receipt of the certificate of completion and/or release of liability. Speaking with the DEC early on can remove some of the guesswork.

The title search

The DEC will guide you with respect to the necessity of obtaining a full title search. The general guidance is that a title report is necessary where the property was acquired by quit claim deed or any other restricted transfer deed. The title report need only date back to the last warranty deed or 40 years, whichever is closer in time.

Preparing easement package, easement agreement

In 2016, the DEC revised its process for completing the EE agreement. Where it used to require the use of a fillable PDF form provided on their website, now the DEC’s EE attorney is drafting all EE agreements after review of the complete and certified EE package.

Finally, throughout the process of preparing the EE, be sure to check the DEC website for updates and revisions to the EE checklist.

ORIANA MONTANI focuses her practice in real estate law at Phillips Lytle LLP, particularly on commercial real estate sales, acquisitions, development and leasing: