Draft Regulations Expand Spill Reporting Obligations

The New York State Department of Environmental Conservation (“NYSDEC”) has issued draft regulations that substantially expand petroleum reporting obligations. Under existing regulations, the facility owner or operator is obligated to report a finding of a petroleum spill. Under NYSDEC’s reporting rules that existed prior to 2015 the obligation was for “any person with knowledge”.

Under the new draft regulations, the reporting obligation remains with a facility owner or operator but is expanded to include “any contractor in a contractual relationship with the facility owner”. The draft regulations do not specify that the contractor must be an environmental consultant or other party performing the petroleum investigation but would support such a conclusion.

Any Other Party and its Contractors Have An Obligation To Report

Significantly, the draft regulations provide that “any other party and its contractors who have been retained as part of a business transaction relating to the facility” have an obligation to report. A business transaction presumably means a contract of sale, lease or easement. Under this provision any party or a contractor who is involved in a business transaction who possess knowledge of a petroleum spill would have an obligation to report. Under this new draft provision, the reporting obligation could include an environmental consultant performing an investigation and extend to a broker involved in the transaction, a lender, and potentially a buyer or seller’s attorneys.

The NYSDEC has been accepting comments under the draft rule and would be expected to issue a new regulation in 2022