Connecticut’s Release-Based Cleanup Program: 10 Key Issues

As Connecticut transitions away from the Transfer Act to a release-based cleanup program, developers, lenders, investors, owners, and tenants must quickly adapt to a significantly different regulatory environment.

This shift comes with a steep learning curve and new compliance and risk management challenges and opportunities. 

Below are 10 key issues for consideration as the regulated community begins to better understand the implications of the RBCP and how it will impact business in Connecticut.    

1. Steep Learning Curve

Release-based cleanup is a complete regulatory shift. Understanding the “who, what, when, and where” of reporting triggers cleanup obligations, timelines, and fees under the new program is essential and complex.  

2. Evolving Legal Landscape

Recent legislative amendments will modify the Transfer Act, the emergence of the RBCP and related environmental programs.

The ground is still shifting, and staying current is critical to limit future liability and take advantage of new opportunities. 

That said, even once the RBCP takes effect, sites and businesses already in the Transfer Act still need to complete their journey under the Transfer Act.

3. Reporting Triggers = New Liability Risk  

Unlike the Transfer Act, RBCP obligations are triggered by the discovery of a historic release on any property (industrial, commercial, residential) and not by the transfer of a particular type of property or business that meets the definition of “establishment.” 

This significantly expands when and how reporting, investigation, and cleanup obligations can arise.  

4. Rethink Due Diligence  

Environmental due diligence for Connecticut transactions must now be conducted with RBCP obligations in mind (for both a seller and buyer, including its lender/investors) since identifying a historic release could trigger a duty to report or investigate/remediate that didn’t previously exist.  

5. New Transactional Risks 

Since additional/new environmental obligations can now arise under the RBCP during due diligence, parties should pay particular attention to allocating environmental risks/liabilities in deal documents under the new program and opportunities to manage and mitigate those risks, including through creative environmental insurance programs (e.g., pollution legal liability and/or secured creditor policies).  

6. Leverage the Opportunity to Choose the Devil You Know or the One You Don’t

With the RBCP adopted but not set to take effect until March 2026, owners, sellers, and potential buyers have a unique opportunity to speed up or slow down deals (including refinancing) to choose between the “devil we know” or waiting until the RBCP is in effect.  

7. Impacts on Day-to-Day Operations  

Owners, tenants, and property managers should review leases and property management agreements and evaluate who’s responsible when historical releases are (inevitably) discovered.

With a new trigger for discovery by “creators” and “maintainers,” understanding the legal obligations (both statutorily and contractually) will be key to addressing RBCP issues in the context of ongoing business operations.  

8. Impacts on Financing  

Environmental due diligence requirements of lenders/investors will now have an even more important role in when, how, and if historic environmental conditions are discovered and managing those issues upfront will be critical to limit surprises and keep deals alive.

Lenders and investors should re-evaluate and update their environmental underwriting standards for Connecticut transactions as appropriate and consider creative environmental risk management tools to get deals done.  

9. Guidance Still Evolving  

Many practical questions remain unresolved.

Without more guidance from the Department of Energy and Environmental Protection, uncertainty will persist, increasing the importance of cautious, well-advised decision-making and continued involvement of the legislatively created “working group” and broader regulated community to address the inevitable unintended consequences. 

10. Work with the Right Legal Counsel 

Engage environmental counsel who understand both the legal and practical impacts of the RBCP and can provide business-friendly guidance to help achieve your or the client’s goals.  

The bottom line remains: Release-based cleanup represents a paradigm shift in how Connecticut regulates environmental contamination. 

What you don’t know can hurt you. Work with experienced environmental counsel to understand your obligations—and how to manage risks proactively and effectively. 

This article first appeared on CBIA's website and is published here with permission.