Looking at the Law

Monday, October 6, 2008

But that's not going to happen.

So, with apologies to Neil Chayet for lending us our title today, we'll move on to what's new in law affecting real estate and development this season. (We had the pleasure of sitting next to Chayet and his wife, Martha, a former Rose Kennedy Greenway Conservancy board member, at the Greenway Gala last Friday. More on that below.)

NAIOP had another full house on Oct. 2, for "Hot Off the Hill: Regulatory & Legislative Update," held at the Boston Harbor Hotel.

Keynoter was Laurie Burt, commissioner of the Massachusetts Department of Environmental Regulation, who it's probably safe to say was a little more enthusiastic about some of these new laws and regs than the developer and consultant types in the room. But everyone was civil.

Following Burt, experts -- mostly lawyers -- talked about 10 different areas in which the state is trying to make life better for Massachusetts residents, but it admittedly may make life a little more expensive and exasperating for developers.

Hitting only the high spots here, and first giving credit to NAIOP for providing travel drives (flash drives, thumb drives -- would somebody come up with a universal name for these?) instead of paper with all the PowerPoint material loaded on it:

Burt said DEP is doing its job with the equivalent of 200 fewer employees than about a decade ago, the early-2000s cuts not having been restored.

She described how DEP is working with the Department of Energy Renewal to implement new policies. Massachusetts recently participated in the first-in-the- country auction of carbon dioxide emissions, raising what Burt said was a total of $38.5 million.

Massachusetts brought home $13.3 million, as these six states held an early, voluntary "sale" of permits to pollute. Compliance starts in January, and 12.5 million tons of CO2 were auctioned -- everything that was on the block.

The Global Warming Solution Act, as it's called, sets economywide targets, including an 80 percent decrease in greenhouse gases by 2050.

"We think it will bring prices down," Burt said. We didn't get a chance to ask how that would happen, but somehow we doubt energy prices will fall.

Regulations for this act are due to be published by Jan. 1, with benchmarks for 2020, 2030, and 2040.

Regarding water, 75 percent of waterways assessed by the state are "impaired," Burt said.

Air is the first major challenge of the environment, she said, to be quickly followed by water. Stormwater causes 60 percent of the pollution, resulting in fish kills, algae blooms, and so forth, but, "We aren't in an acute crisis," she said.

A general permit program with self-regulation will be used as much as possible with new regulations, Burt said, "not the old command and control."

A few regs are even getting less stringent. PCEs, or perchloroethlenes, are not as dangerous when inhaled as previously thought, she said.

As new regulations are promulgated, everybody has to keep in mind all the old ones too. Those old ones aren't being scrapped, but at least they are being scanned and will all be available on line in 2010, Burt said.



Last week's 8-11 a.m. meeting just flew by, as:

-- Seth Jaffe of Foley Hoag LLP talked about Super MEPA, an "integrated permitting review" process. Burt said the Patrick administration is committed to "moving at the speed of business," and this policy, issued June 2, is supposed to provide earlier information about project impacts, encourage state agencies to take clearier positions earlier regarding major permitting issues, and maybe most important better coordinate input from all agencies.

Cautioning that it's for "noncontroversial" projects, Jaffe said it remains to be seen if it will speed things up. "What is the point of all this if you can't be certain you're going to get your permits out quickly?"

-- Lauren Liss of Rubin & Rudman LLP addressed the Greenhouse Gas Policy, which she noted admiringly is "only seven pages long."

It's something of a work in progress but it requires basically that any project that requires an environmental impact report will now have to quantify greenhouse gas emission.

The focus is on CO2, and offsets for expected emissions should be "real, permanent, and enforceable." There's no specific mitigation target amount set -- it's a slightly scary "We'll tell you when it's enough" system, Liss said.

One feature she described caught our attention: Developers have to propose a "better project" than they plan to build, and then make the case why they're not doing it.

-- H. Hamilton Hackney of Greenberg Traurig LLP took up the DEP Stormwater Initiative. "Soon you will need a permit to discharge stormwater," he said.

Possibly early next year.

Stormwater wasn't an issue before the early '90s, and then the EPA regulated it. But it's become a significant issue over the last 4-5 years, he said, and is now an EPA priority. It used to be covered only by wetlands protection laws in Massachusetts.

Now DEP is concerned about water quality and infiltration of pollutants into bodies of water everwhere. It concerns all locations statewide, not just wetlands.

-- Jamie Fay of Fort Point Associates, Inc. talked about the proverbial Chapter 91 Landlocked Tidelands Regulations, and they're almost too complicated to even get into here. The 2007 law is five pages long, and the draft regs are 27 pages. Those regulations are expected to be issued next month, he said.

Basically, if you're going to build on land the public has or once had a right to, you're going to provide some mitigation and public space or other benefits -- preferably on site but in some cases off site or in cash.

-- Ronald Ruth of Sherin and Lodgen LLP addressed 2008 MESA Maps, about which he said there is "much excitement." This involves the Massachusetts Environmental Protection Act and habitat protection, both "priority habitat" in upland areas and "estimated habitat," a fuzzier term, in wetlands. The law protects both plants and animals.

Regulations will be issued in about two weeks, Ruth said (but there are some bootleg copies floating around).

Six species formerly listed as endangered will be delisted, which clearly made NAIOP chief executive David Begelfer happy. He doesn't dislike wildlife, he just likes coexistence.

Ruth said the Massachusetts Environmental Protection Act is triggered for a project if the affected priority habitat is two acres or larger. Some had argued for a less stringent five acres. New maps are issued every two years, and the 2006 map was controversial because it expanded priority areas. The 2008 maps are eagerly awaited.

The Department of Fish and Wildlife reported a 5.2 percent reduction in the total area of priority habitats as of Oct. 1.

-- Deborah Gevalt of Haley & Aldrich, Inc. conquered the subject of Asbestos in Soil Regulations. She said this involves "quite possibly the longest living draft legislation in the history of the commonwealth." The most recent version is almost a year old.

The draft final regulations and policies are due Oct. 11, she said, and there will be 6-9 months between publication and implementation. There will be new asbestos reporting rules, a distinction between abatement and remediation, and implications for development and brownfields redevelopment.

-- Lisa Campe of Woodard & Curran, Inc. on Indoor Air Policy, said groundwater to indoor air is not a recognized pathway for undesirable breathables, but soil may be a source in some sites as well.

Some current concerns for developers are that there are no "background" levels established for indoor air quality, some sites closed out years ago have been reopened by DEP, and "stringent and shifting policies impede investment and development."

-- Michael Vhay of DLA Piper US LLP described the Green Communities Act, which prompts a sweeping new look at Massachusetts gas and electricity markets, implements the multistate Regional Greenhouse Gas Initiative, and promotes conservation, renewable energy, and R&D.

The Board of Building Regulations and Standards must adopt and integrate the International Energy Conservation Code as part of the state's building code -- but it can go further.

Vhay said NAIOP successfully fought to have the state implement these -- rather than the 351 communities each having a separate set of rules.

Under new code provisions, any new nonresidential building of 10,000 or more square feet, or any building undergoing major renovation, must have energy systems commissioned or tested for acceptance.

Some of these revisions "could bite the development community," Vhay said. The state is going to offer up to $10 million in grants for energy-efficient projects and renewable and alternative energy projects.

Utilities are required to buy renewable energy that is generated, and they may build, own, and operate solar facilities.

-- Kathleen McCabe of McCabe Enterprises talked about I-Cubed, which we recently journalized on at length. Sorry, Kathy. (If you want details: mccabe@Plan-Do.com .)

-- And, yes, finally: Douglas Landry of Vanasse Hangen Brustlin, Inc. on the Transportation Bond Bill. Landry listed 24 state, federal, and other agencies involved in transportation planning, and he said the two transporation bond bill -- of seven bond bills passed this year totaling $14-billion-plus -- are designed to help cut through that confusion.

They total about $5 billion -- not close to the $19 billion that it's pretty much agreed the state's transpostructure needs to stay in the condition it's currently in.

But there's also a bridge bond bill for some $3 billion, to speed up repair of 300 structures over the next eight years, and some transportation money is tucked away in assorted other bond legislation.

Even the billion-dollar life-sciences bill has $12.6 million in it for the Lowell Junction interchange.

Bond bills of course mean there is authorization to borrow the money. Not that it's borrowed or available yet.

Then everybody went off to work.







INAUGURATION DAY

As you probably know and maybe even witnessed, the Rose Fitzgerald Kennedy Greenway was inaugurated on Saturday, Oct. 4.

The old Green Monster is just a memory.

It couldn't have been a nicer day. There were long lines at the ferris wheel and Starbucks, the fountains performed, and the Boston Public Market made a rocking return for the occasion at Dewey Square.

We sampled the chocolate-chip gelato from Garden Girl/Urban Sustainable Living of Roxbury, and had a mouthwatering piece of chocolate bread at another tent.

With luck, the security issues will get worked out, perhaps with the help of The Boston Foundation, and the market will be back next summer.

Three good friends of the market, who are working on that, were there (pictured above): advocate Yanni Tsipis, market board chairman Don Wiest, and promoter Marlo Fogelman.



The wood-and-steel bear sculpture near the High Street block of the Greenway is temporary (as is the ferris wheel, though years ago there was talk of a permanent one), installed for inauguration festivities and a few weeks afterward.

It is one of five works of art that was scheduled to be put on the Greenway for inauguration weekend following a competition.

But two of the five pieces didn't, shall we say, live up to expectations. And unfortunately one of the three that did, a piece of marble, broke as it was being transportated. So two remain, until November, when they too will depart.



State Street Corp. sponsored a terrific gala dinner in the Wharf Room at the Boston Harbor Hotel on Friday night.

A lot of money was raised, and a lot of people got thanked for their efforts on behalf of the Greenway.

Norman Leventhal, 91, who had a Greenway dream long ago, was there. "How are you doing, Norman?" "I'm here!" Emcee Peter Meade, also Greenway conservancy board chairman, moved things along at a splendid pace.

Caroline Kennedy Schlossberg graciously remembered her grandmother, Rose, and thanked her husband, Ed. He's on the conservancy board and has contributed lots, she said, since he got the assignment from "Uncle Teddy."

Senator Kennedy wasn't there, but his sister, Eunice Kennedy Shriver, represented the generation.