Fees Developers Encounter When Generating Hazardous Waste

In New York City alone, it has been estimated that 7,600 acres of real property (an area more than nine times the size of Central Park) are contaminated with urban fill material and various other human-transported or anthropogenic deposits, some of which are considered “hazardous” under New York law. Add to this total the countless acres of property throughout the state that are be impacted by contaminants from former industrial processes, petroleum storage, accidental releases of contaminants and unlawful dumping activities. These properties can often present lucrative acquisition and development opportunities if environmental conditions are properly assessed and managed. Through the assistance of counsel and skilled consultants, owners and developers can often quantify to a reasonable degree the liabilities and costs associated with acquiring and redeveloping contaminated properties. However, in addition to the commonly anticipated and often considerable costs of managing environmental conditions as part of a development project, there are potentially quite large and frequently overlooked expenses that could land a fatal blow to a project budget.

Two programs that may burden the unsuspecting developer and can greatly impact the project owner’s bottom line are the New York State Hazardous Waste Program Fees and the New York State Special Assessments on Hazardous Waste Generated. Both of these programs may add significant costs that were not contemplated by the owners or developers of property contaminated with hazardous waste. These programs each require the payment of annual fees—as much as $800,000 for very large quantity generators—based upon the amount of hazardous waste that is generated within the state during any calendar year. Developers do not typically consider themselves generators of hazardous waste and, therefore, are often not aware of these additional costs. However, site development activities, such as excavation and dewatering, may generate large quantities of contaminated soils and wastewater that must be characterized, manifested, transported, and disposed of properly. To the extent that these materials contain constituents that render them “hazardous” under New York law, the fees and assessments may be payable.