The Environmental Practice Group has prepared a Client Advisory titled “New Jersey Department of Environmental Protection Discontinues Use of Letters of Non-Applicability Under Industrial Site Recovery Act.” The Advisory discusses the New Jersey Department of Environmental Protection’s (“NJDEP”) announcement that as of May 1, 2008, it has discontinued the use of Letters of Non-Applicability (“LNAs”) under the state’s Industrial Site Recovery Act (“ISRA”). The NJDEP is taking the action because LNAs are not required under ISRA for transactions that do not trigger the requirements of the statute. Due to the statewide budget crisis, the Department wants to focus its scarce financial resources on programs that involve mandatory compliance obligations.

Parties to transactions that potentially may trigger ISRA will now have to rely on their own environmental consultants and legal counsel to advise them on its application to a given transaction. Consequently, greater vigilance will be required on the part of purchasers, landlords and lenders in performing environmental due diligence and negotiating appropriate contractual protections, as these now will be the only avenues available to ensure compliance with ISRA and to determine its application.