May 25, 2017 Articles

Superfund Sites and Property Value Diminution

Chemicals may impact the waterways, but people and their purchasing decisions determine the markets.

By Orell C. Anderson and Alexander R. Wohl – May 25, 2017

With the new administration’s proposed cuts to the Environmental Protection Agency (EPA) budget, the issue of Superfund funding is back in the news. The recent proposed cuts would continue a long-term trend of decreasing federal funds to the EPA’s Superfund, a program that channels money for cleaning up hazardous-substance contamination at sites. Annual appropriations to the Superfund program declined to $1.1 billion from $2 billion between 1999 and 2013.

According to a 2015 report from the Government Accountability Office, the EPA responded to the reduced allocations during the 2000s by prioritizing ongoing projects and therefore delaying the start of approximately one-third of the new remedial-action projects at National Priorities List (NPL) sites. Accordingly, though the present cuts may not necessarily affect the remediation of specific sites or even the total number of projects, they may affect timing.

As described below, timing can play an important role in property value diminution and damages analysis. But exactly how these cuts will affect property values or damage estimates is yet to be seen.

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