'Innocent buyers' hope bill will solve their issues. The DNR worries it will leave contamination.
Laura SchulteMADISON - Lawmakers are hoping to provide support to "innocent" buyers of property they didn't know was contaminated with a new bill introduced last month.
The bill was inspired by Madison resident Ken Koeppler's story of purchasing a building on the city's east side in 1987, not knowing it had been a former dry cleaning facility. He lived in the building for nearly 20 years before renting it out, never knowing about the contaminated soil beneath the small, one-level home.
The legislation, known as Assembly Bill 44, would allow homeowners who purchased their property before Sept. 1, 1992, and had no knowledge of contamination not to be responsible for the contamination and the often-expensive cleanup costs.
It would also exempt a county from the responsibility of contaminated properties and allow it to sell a property to a buyer who would also be exempt from responsibility.
The responsibility for cleanup would likely fall to the state in these circumstances and would be paid for by taxpayers.
Under the state's current "spills law," the owner of a contaminated property can be held liable for contamination they didn't cause. In Koeppler's case, the building he owns was a dry cleaner so long ago, he didn't even know what the building had been used for. When he searched for the previous owners, he discovered they had all died.
Koeppler found out there was contamination beneath the building in 2015, after the Department of Natural Resources asked to conduct testing on his property. The business had released tetrachloroethylene, also known as PCE, into the environment. Since then, he's been battling the state over the responsibility for cleanup costs.
So far, Koeppler has placed a vapor mitigation system beneath the building to handle the toxic fumes rising through the concrete below it, dug monitoring wells and paid for testing. But there's still more work to be done to find the extent of the contamination and remove it from the densely packed neighborhood on Madison's east side.
Over the last few years, he's gotten some grant funding from the state and federal government, which has paid for the cost of several monitoring wells near the building, but he's worried about the future — when the grant funding runs out and he's again left with the bill. He's already spent close to $60,000 of his own money, he said, on top of the about $40,000 the grant has covered so far.
The grant has been a relief, he said, but without some type of innocent buyer protection, he's concerned.
"I'm not going to pay any more," he said.
Similar legislation was introduced last session, but wasn't voted on before the session ended.
"I'm glad to hear it's being reintroduced again," he said.
DNR, Democrats say fund to help property owners is better solution
When the legislation was introduced last time, the DNR said that, in the long run, it could end up costing hundreds of thousands of dollars of taxpayer money and leave a slew of properties sitting abandoned due to contamination.
It could also affect the "spills law," which has been used for decades to ensure that Wisconsin's water, soil and air remain clean.
During testimony on the bill introduced during the last session, a DNR employee said the law could actually hinder cleanups, putting more people at risk.
"These proposed exemptions would very likely result in more properties with contamination that would not get cleaned up and therefore could pose threats to human health and the environment," said Christine Seiger, a supervisor for the agency's redevelopment & remediation program.
The bill would also leave contamination for the state to clean up, which would still end up costing taxpayers.
"Depending on the complexity of environmental and public health issues, the estimated cost of this exemption to taxpayers could range from $62.3 million to $416 million," she said during the 2022 hearing. "Presently, there is not enough state funding available to assess, investigate and clean up all of the newly exempt properties this legislation would create, or even ensure a minimal level of protection."
Instead, the agency suggested establishing a fund to assist innocent buyers in paying for the investigation and cleanup of contamination. Gov. Tony Evers proposed a fund similar to the suggestion from the DNR in his recent biennial budget proposal, though it's unclear if Republicans who control the Legislature will support it.
But providing funds, rather than passing along responsibility, is the best way to handle contaminations like these, said Sen. Kelda Roys, D-Madison.
"I think it's important that all parties in real estate transactions go into deals with their eyes open," she said. "Nobody is guaranteed to make a profit and we don't want to give people an incentive to fail to do due diligence on properties and we also don't want to give property owners an out to not fix dangerous pollution on their properties.
"I think the solution is not to absolve property owners or purchasers or real estate investors from any responsibility. It's instead to make sure that we have adequate public funds available that can be accessed to clean up those sites."
Laura Schulte can be reached at leschulte@jrn.com and on Twitter at @SchulteLaura.