Bona Fide Prospective Purchaser
House Bill 272, passed by the 2005 Kentucky General Assembly, provides liability protection for bona fide prospective purchasers of qualified properties. A bona fide prospective purchaser (BFPP) is an entity that:
Did not cause the contamination.
Has conducted an "all appropriate inquiry" assessment of environmental issues at the property.
Takes care to prevent the environmental problem from becoming worse.
Takes appropriate steps to prevent or eliminate exposure to previously released hazardous substances.
Is willing to provide access to the property for cleanup purposes.
Does not disrupt any institutional controls or violate land-use restrictions designed to manage the contamination.
Has no affiliation with the party responsible for the contamination.
For more information on the U.S. Environmental Protection Agency's (EPA) rule on all appropriate inquiry and bona fide prospective purchaser liability protection, see the EPA's Brownfields Liability website. To be eligible for state and federal brownfield cleanup grants, an entity must be a Bona Fide Prospective Purchaser.
During the 2012 Legislative session, a law was passed to enhance programs aimed at the redevelopment of brownfields in the Commonwealth. The result was a program that provides property owners and prospective property owners (who can certify that they did not cause a release or have a relationship with those who did and who develop a plan to reuse the property safely) documentation that they will not be held responsible for conducting site investigation and remediation under Kentucky Superfund Laws, specifically KRS 224.1-400 and KRS 224.1-405. For more information on this portion of the Kentucky Brownfield Redevelopment Program visit the redevelopment process page.
Note About “Closed” Sites
The federal Comprehensive Environmental Response, Compensation and Liability Information System (CERCLIS) database often list sites as NFRAP – No Further Remedial Action Planned. This refers to no further federal action being planned. The state may still have concerns about the property. The state database may list a site as “closed.” This generally means that a particular release or incident at a property has been properly addressed. There may be additional, often unidentified, issues at the property that are not included in the closure.
Furthermore, conditions at a site can change over time. For example, illegal dumping may have occurred in the intervening period. In addition, better knowledge of environmental issues, such as vapor intrusion, may mean that a remedy that was acceptable at the time may now be judged to be inadequate. Therefore, it is important that you have a current All Appropriate Inquiry (or Phase I Environmental Assessment) of the property before you acquire the property. For liability protection, the assessment must have been conducted within one year prior to the date of acquisition, with certain components of the assessment updated if conducted more than 180 days prior to the purchase.