1. John Slavich Guida, Slavich & Flores, P.C. 750 N. St. Paul Street, Suite 200 Dallas, Texas 75201 214.692.0009 E-Mail: slavich@guidaslavichflores.comslavich@guidaslavichflores.com WHO IS GETTING TAKEN TO THE CLEANERS? WORKING WITH THE TCEQS DRY CLEANER REMEDIATION PROGRAM

2. 2 Dry Cleaner Environmental Response Statute Texas Health & Safety Code Chapter 374 Originally created by 78 th Legislature in 2003 Amended by 79 th Legislature in 2005 © 2006

3. 3 Overview Provided for registration, operational regulation, investigation and remediation (corrective action) of dry cleaning facilities. Created a fund to pay for corrective action for releases from dry cleaner facilities. (374.101) Financed by dry cleaner registration fees and fees imposed on the purchase of dry cleaner solvent. (374.055) © 2006

4. 4 Overview (contd) Provided for rules that impose performance standards. (30 TAC § 337.20) Imposed release reporting for dry cleaning solvents. (374.151(b)) © 2006

5. 5 Definitions Release (374.001(13)) Dry Cleaning Facility (374.001(7)) Dry Cleaning Solvent (374.001(8)) Contaminated Dry Cleaning Site (374.203(a)) Owner (374.001(12)) Fund (374.001(11)) Corrective Action (374.001(4)) –Also definitions in regulations (30 TAC Ch. 337, as most recently amended effective 2/1/06) © 2006

6. 6 Dry Cleaner Remediation Program If a contaminated dry cleaning site has been ranked under 374.154, then State of Texas may use money from the fund (up to $5M for that single site) (374.203) for corrective action at the site © 2006

7. 7 Eligibility Two classes of owners are eligible to apply for a site to be ranked. (374.154(b) and.203) 1. Owner of dry cleaning facility –Not in arrears for money owed to state –In compliance with applicable performance standards (at time of release) 2. Owner of the real property on which the facility is located. –Five-year ownership requirement removed in 2005 amendments Includes former owners of facility and owners of real property on which facility was formerly located (§ 337.31(a)(2)) © 2006

8. 8 Site Ranking (374.154; § 337.31) An eligible person must submit a ranking application to be eligible for State cleanup (374.203(c)) Non-emergency sites are ranked in order of relative significance (374.154(a)) Deductible of $5,000 per site must be met (374.203(a)) © 2006

9. 9 Site Ranking (cont) TCEQ is to assign a rank for a site based on information contained in application (374.154) Ranking procedures (§ 337.31) –Numerical score assigned for a site TCEQ to assign ranking within 90 days. © 2006

10. 10 Site Prioritization (§337.30 ) Determined semi-annually (§337.30(a)) TCEQ will consider factors in addition to ranking score (§337.30(b)) Relative priority can change (§337.30(c)) © 2006

11. 11 Corrective Action TCEQ is responsible for corrective action Corrective action includes investigation, assessment and cleanup of affected soil, groundwater, and surface water (onsite and offsite) TCEQ cannot compel eligible persons to undertake corrective action (exceptions) TCEQ can compel site access TCEQ can approve other entities to perform corrective action © 2006

12. 12 Comparing DCRP to VCP © 2006 DCRPVCP Who can apply?Eligible personsAnyone (subject to site eligibility) Cost to apply$5,000 deductible$1,000 application fee Who does work?State contractors (State-lead program) Applicant hires contractors

13. 13 Comparing DCRP to VCP (contd) © 2006 DCRPVCP Other costsNonePay for corrective action; pay for State oversight State confirmation of completion No Further Action letterCertificate of Completion ProtectionEligible persons exempt from claims under State law for: (i) Cost recovery (ii) Enforcement of corrective action (with exceptions) Release of liability to future owners and lenders

14. 14 Points for Clients to Consider Is the site impacted by contaminants of concern in addition to dry cleaning solvents from the dry cleaning facility? –DCRP limited to addressing dry cleaning solvents from dry cleaning facilities (374.208(b)) –Other COCs need to be addressed under other State programs. When will NFA letter be issued? –Impact on financing –Impact on exit strategy © 2006

15. 15 Points for Clients to Consider (cont) Is a commercial/industrial closure sufficient? –Impact on residential/mixed-use redevelopment. Cannot dual track DCRP and VCP. –Limit on being in both programs simultaneously. –Can drop out of DCRP and re-enter. DCRP work can bar later entry of site into VCP. –Remediation will make site ineligible for VCP (See § 333.6 of VCP rules, Q&A C2 and C4). © 2006