Thursday, December 3, 2020

LESSONS LEARNED FROM MASSDEP’S 2020 REVIEW OF ITS LICENSED SITE PROFESSIONALS

 Samuel Butcher

The Licensed Site Professional Association (LSPA) and the Massachusetts Department of Environmental Protection (MassDEP) recently presented a training session on a recent review of the 2019


LSP Response Actions audit findings in an effort to summarize “lessons learned” for the benefit of all. There are some take-aways of which you might want to be aware.

First, as background, the MassDEP performs both random and targeted audits of documentation associated with LSP response action submittals.  These audits primarily concentrate on Activity and Use Limitations (AULs), a percentage of which the MassDEP is required to audit. 

Additionally, MassDEP includes all of the various other submittals which an LSP or Responsible Party might submit.  These include Risk Characterizations, Permanent Solution Statements, Downgradient Property Status (DPS) Opinions, and others.

 There appear to be three big lessons to which we all need to pay attention, as they likely affect your professional responsibilities and your clients’ properties:

·        AULs – Most of the errors and deficiencies associated with AUL audits revolved around conveyance errors.  The AUL must be conveyed with the deed upon transfer.  AULs are to “run with the land.” If such a conveyance is not clear or not implemented, that is a large problem, and can be a target for enforcement.  Related AUL problems, uncovered in the study, include inadequate documentation of inspections and incomplete delineations of the AUL boundaries.

·        Incomplete Site Characterization – The age-old question of “how much data is enough.”  The audits indicate that the MassDEP has concluded that in many situations there were inadequate data to support the conclusions made.  For example, there may be not enough reliable information to support an understanding of the extent of contamination or to develop exposure point concentrations.  

On this score, it would be easy to say that regulators always want more data and your data are never enough. That may be part of the issue. Yet another part is that LSPs could do a better job of explaining how they are using their data, what data were needed or useful, and perhaps why more data were not collected.  If there is a logical basis to support the data collected, sufficient to support and then corroborate conclusions, you may say so. That may address MassDEP questions.

·   Downgradient Property Status – Quite simply, MassDEP audited only a small number of DPSs but, in nearly all the cases, they found that there was not sufficient information to support the DPS opinion.  MassDEP reminds us that your DPS must both establish where the upgradient contamination is coming from and demonstrate there is no source on the 21E site on whose behalf you are submitting the DPS.  If you have not demonstrated both, the DPS is likely not complete.

We will be keeping an eye on these issues as we all incorporate these lessons in our services and any opinions we might be reaching, writing and submitting on behalf of our 21E clients.

Sam Butcher is a MA Licensed Site Professional at Loureiro Engineering Associates in Rockland, MA. He is a member of REBA’s Environmental Law Section. REBA membership is open to attorneys and other real estate and related professionals.  Sam can be reached at swbutcher@loureiro.com.

 

Wednesday, December 2, 2020

The Pooled Timber Income Fund: A New Conservation and Estate Planning Tool

 Todd Rodman

The New England Forestry Foundation has created a new vehicle for land conservation called the Pooled Timber Income Fund (PTIF).  The PTIF offers landowners the opportunity to permanently protect


their forest lands while receiving tax benefits, lifetime income and protecting working woodlands.

Since its founding in Boston in 1944, the New England Forestry Foundation has pursued innovative programs to advance conservation and forestry throughout New England. In partnership with land owners, NEFF has conserved more than 1.1 million acres of land, including one out of every three acres of forest protected in New England since 1999. Today, NEFF continues this conservation work through innovative conservation tools like the PTIF.

The PTIF is a new application of a well-established planned giving tool, but with some key differences. In a traditional pooled income fund, donors contribute cash or other assets to a charity, the charity invests the assets, and the income after expenses is distributed to the donors until their death, at which point the assets belong to the charity. In this planned giving vehicle, donors receive both lifetime income and a charitable tax deduction at the time of the initial donation. 

With NEFF’s PTIF, an owner’s interests in its forestlands are bifurcated, with a fee interest in the land donated to NEFF, and the timber growing on that land separately conveyed to the PTIF. In exchange, the landowner receives units in the fund equal to the value of its timber donation.  The fund then manages the timber in accordance with NEFF’s green-certified, Exemplary Forestry Management. This type of forestry balances income generation with the long-term health of forests. As with any traditional pooled income fund, donors receive both an initial charitable tax deduction and lifetime income.  However, with the PTIF, fund participants have the significant added benefit of participating in an investment that actively combats climate change. The PTIF uses Exemplary Forestry Management on all of its properties, leading to older, more diverse forests with a mix of tree age classes. Research suggests that this type of forest management makes the forests more resilient to climate change. This results in faster timber growth with a higher volume of wood than a typical forest, which increases the benefit to society due to the forests’ action in removing damaging carbon dioxide pollution from the atmosphere.

In addition to contributing to these climate benefits, the donor receives lifetime annual income generated from timber harvests on all of the land in the PTIF. The income is distributed based on the number units assigned at the time of donation. Using data from Massachusetts-based forests owned by NEFF, the projected rate of return before expenses on timber donations to the PTIF should range between 1.5 percent and 2.5 percent of the timber value per year. If the Pooled Timber Income Fund were to operate at a loss in any year, there would be no distributions to beneficiaries, but also no liability to cover those losses on the part of beneficiaries. Shares cannot be sold or transferred other than to successor beneficiaries named at the time of the donation. Because timber is harvested in most years from one or more of the pooled properties, each member of the fund is likely to receive a more consistent stream of income than they would if they managed their own land. There is also a reduced risk of loss from weather, insects, or other hazards, and reduced risk regarding timber prices due to the greater diversity of timber types and stand ages likely to be present in the fund.

Participants in the PTIF are eligible for a number of potential tax benefits (i.e., income, property and estate taxes), the value of which will depend on personal circumstances. Landowners donating to the PTIF may be able to claim a charitable tax deduction on their federal income tax returns for both the donation of the land to NEFF and the donation of the timber to the PTIF. The value of the donation to the PTIF is calculated from the timber value reduced by the expected income until the land passes on to NEFF. These deductions can be taken in the year of contribution and up to five succeeding years, subject to income-based limits on deductions. After enrolling in the PTIF, the landowner is no longer responsible for further property taxes on the woodland because NEFF will pay property taxes on the property while it is enrolled in the PTIF.

On the death of the landowner’s beneficiaries, the landowner’s shares are transferred to NEFF and the associated lands would merge back into the woodlands in NEFF’s portfolio of Community Forests.  NEFF owns and manages more than 140 properties totaling almost 30,000 acres across New England for the benefit of all New Englanders. These permanently protected Community Forests provide wildlife habitat and sustainably harvested wood, and because they are also free and open to the public, they can be enjoyed by visitors of all ages.

Though NEFF’s Pooled Timber Income Fund was designed as a vehicle for private forest landowners to donate forest land for conservation - cash or securities can also be donated to the PTIF. Cash and security donations entitle the donor to units in the PTIF based on market value of the asset given. In any case where cash or securities are donated, the PTIF will hold those funds in interest bearing accounts or diversified equity investments while seeking timber purchase opportunities.

 

Whether a donor is contributing timber or cash, the PTIF is a great tool to assist with future planning while advancing forest conservation throughout New England. This tool is unique in its ability to provide donors with both financial and conservation benefits. By supporting the PTIF you can help preserve the landscape of New England, protect forest wildlife habitat and ecosystems, and combat climate change.

A member of REBA’s land use and zoning section, Todd Rodman is a partner at the Worcester firm of Seder & Chandler LLP.   He has developed a broad ranging practice representing many aspects of the real estate industry. Todd represents individuals, real estate development companies, pension funds, REIT's, financial institutions, non-profits and others in connection with the acquisition, development, sale, leasing, management, permitting, construction and financing of commercial and residential properties.  Todd can be contacted at Trodman@sederlaw.com.

 

For more information about the program please contact conservation project manager, Sophie Traficonte at straficonte@newenglandforestry.org.

Monday, November 23, 2020

Lawn Maintenance Alone is Not Sufficient to Establish Adverse Possession

Elizabeth Lake

The Land Court issued a recent decision denying a property owner’s motion for a preliminary injunction in Geiger v. Needham Miller, LLC, No. 20 MISC 000269 (JSDR), 2020 WL 4436449 (Mass. Land Ct. Aug. 3, 2020). At issue in this case was an approximately 270 square foot area of the Defendant LLC’s property (“the Disputed Area”). The Plaintiff claimed ownership by virtue of adverse possession based on his use of the Disputed Area as an extension of his lawn. In denying the Plaintiff’s motion for preliminary injunction, the Land Court held that the Plaintiff’s use of the Disputed Area, consisting solely of lawn maintenance, was not open, adverse, and exclusive to satisfy a claim for adverse possession.

In denying the Plaintiff’s motion for preliminary injunction, the Land Court held that the Plaintiff’s use of the Disputed Area, consisting solely of lawn maintenance, was not open, adverse, and exclusive to satisfy a claim for adverse possession.

The Plaintiff in this case continuously resided on his property since approximately March 1990. Since such time, the Disputed Area was marked by a shrub, tree, and a planting bed. The Plaintiff alleged that at all times during his ownership, the Defendant LLC and its predecessors occupied and maintained the planting bed, while the Plaintiff occupied and maintained all the land to the right of the planting bed, to the exclusion of all others. Specifically, the Plaintiff alleged that he and professional landscapers engaged in the following acts on the Disputed Area: weekly moving during the growing season, applying fertilizer, seeding, seasonal clearing of leaves, removal of debris after storms, and seasonally watering multiple times per week. The Plaintiff also engaged professional arborists who had full access to and moved across the Disputed Area to tend to trees on the Plaintiff’s property.

To support his position, the Plaintiff relied upon the 2019 Appellate Court decision in Miller v. Abramson.   In Miller, the Appeals Court affirmed a judgment declaring that the Millers had acquired a thin triangle of land, approximately 492 square feet in size, by adverse possession. The Millers and their landscaping company mowed the lawn weekly and performed typical residential landscaping work within the disputed area. On appeal, the Abramson’s argued that lawn maintenance was insufficient to establish adverse possession under Massachusetts law. The Appeals Court disagreed,1 stating that Massachusetts law is more nuanced than that, and noted that “the context supplied by the surrounding landscape is significant in an adverse possession case — a use that is sufficient to establish ownership in a densely populated neighborhood may be inadequate in an isolated, wooded setting.” Id. at 833. Relying upon this premise, the Appeals Court held that the Millers engaged in typical suburban lawncare that gave rise to ownership.

The Defendant LLC argued that although lawn maintenance has been a factor in finding adverse possession, the courts have generally relied on factors in addition to lawn maintenance to support an adverse possessor’s claim. The Land Court agreed with the Defendant LLC and held the Plaintiff’s lawn maintenance was not open and adverse. The court wrote, “in every case that this court has reviewed, including those cited in Mullins, factors in addition to lawn maintenance support the adverse possessor’s claim.”

The court also held that the Plaintiff’s lawn maintenance was not an exclusive use, further supporting the court’s denial of injunctive relief. A use is exclusive if such use excludes not only the owner of record title, but also all third parties to the extent that the owner would have excluded them. Here, the Plaintiff did not take any steps that would have precluded the use of the Disputed Area by others. In its analysis, the court specifically noted that the Plaintiff did not fence off the Disputed Area, erect any structures on the Disputed Area, plant trees or shrubs, or incorporate the Disputed Area into his irrigation system. Further, the Defendant LLC’s predecessor had engaged a landscaping company to perform spring and fall cleanups every year from 2003 through 2018. The cleanup included the Disputed Area where the landscaping company blew leaves and picked up sticks and branches on the Disputed Area. By allowing others to go on to the Disputed Area for lawn maintenance activities, the Plaintiff’s use was not exclusive.

The principal takeaway from the Geiger decision is that if you are seeking ownership by or defending a claim for adverse possession, simply mowing and yard maintenance may not be adequate to establish adverse possession due to the fact-specific nature of each property dispute. Thus, consultation with counsel in bringing and/or defending such a claim is advised.

Liz is an associate in the litigation and real estate departments of Moriarty, Troyer & Malloy LLC. Liz concentrates her practice in condominium and real estate litigation and zoning and land use matters. Prior to joining MTM, Liz practiced in the litigation department for Steptoe and Johnson PLLC in West Virginia representing clients in all phases of litigation.  Liz can be contacted at elake@lawmtm.com 

Thursday, September 17, 2020

It’s Time to Bring your Condominium Documents into the 21st Century

Matthew W. Gaines

A lot has changed in the world since the advent of condominiums, and subsequent boom of condominium development in the 70s, 80s


and 90s.  However, most condominium documents, including many of those drafted more recently, are still far behind when it comes to methods of communications, voting and holding meetings.  I recently reviewed a set of documents that were drafted in the 1990s and they mentioned one of the methods by which notice can be give to unit owners is by telegraph.  I can’t imagine many boards or property managers have telegraphs lying around.  Since drafters of condominium documents often use the same template over and over again, unfortunately, even documents drafted in the 2000s do not contain provisions one would expect to see for a new condominium.

 

Notice by email.  One of the more common questions we receive is can the board or property manager send notices to the unit owners by email.  All documents have a section stating the method by which notice must be given to unit owners for meetings or other matters.  Typical language states notice to unit owners shall be given by leaving the notice at the unit or by mailing it to the address of the unit owner.  If notice by email is not specifically stated in the documents, then technically, notice by email is not sufficient.  Failure to give proper notice can result in a domino effect whereby any action taken subsequent to insufficient notice could be deemed invalid.  The solution is to amend the notice section in the documents (usually found in the bylaws) to permit notices to be sent by email.  Amendments to the bylaws do require the approval of unit owners.  If such an amendment is adopted, the board or property manager should keep a list of the current email addresses for all unit owners.

 

 

Electronic Board Meetings and Voting. While the issue of whether boards may meet and vote using electronic means has come up from time to time over the years, the Covid-19 pandemic and related restrictions on gatherings brought greater attention to this issue.  Many condominium documents are either vague or require actual in-person meetings and voting by the board.  Actions taken by a board which are not in compliance with the strict language of the documents could be subject to challenge.  Given that many board discussions take place via email, coupled with the fact board members are volunteers who often have full-time jobs and lives outside of the board, it would be prudent for the board to have the ability to meet via conference call, video conference or other electronic means, and to permit the board to make decisions via electronic means, including email.  The reality is many boards are likely already doing this, but perhaps such practice is not permitted by the documents.  Therefore, it is advisable to amend the relevant provisions in the condominium documents to permit boards to meet and vote by electronic means.

 

Electronic Unit Owner Meetings and Voting.  Many condominium documents require the annual meeting of the unit owners and elections of board members take place during April, May or June.  Due to the Covid-19 restrictions on gatherings, our office received many calls from boards and property managers asking what they should do given the inability to actually hold a unit owner meeting and election.  Many clients inquired whether they could hold a virtual ZOOM annual meeting and vote by electronic means.  As such technology was not available until recently, unfortunately, very few documents permit unit owners meetings to be held virtually, nor do the documents permit electronic voting.  Once again, the solution is to amend the documents. 

 

With respect to voting by electronic means, there are various services available which are set up to handle voting by unit owners over the internet.  Security and fraud are of course always a concern; thus, it is important to ensure the service chosen has adequate protections in place.  If a unit owner indicates he or she is not comfortable voting via the internet for whatever reason, the board should have paper ballots available.

 

With respect to holding unit owner meetings by electronic means, this is a bit trickier as unlike electronic voting which can have the alternative of a paper ballot, for meetings the meeting is either in-person or virtual, a hybrid approach likely would not work.  During the height of the Covid-19 pandemic, as many boards sought to hold unit owner meetings via ZOOM, several concerns were expressed.  What if a unit owner does not have the technology enabling them to participate?  In addition, for large condominiums, holding a ZOOM with 100 or more people could be difficult to manage.  Therefore, virtual unit owner meetings may not work for all condominium.  Before a board considers amending its documents to permit virtual unit owner meetings, it would be advisable to survey the unit owners to determine their comfort level with such an approach and to discuss alternatives if owners are not comfortable.

 

While boards often propose amendments to documents which could be viewed as controversial (smoking, leasing, pets, etc.), it is unlikely boards will run into much opposition for amendments to permit notices by email, and to permit boards to meet and vote by electronic means. 

 

A member of REBA’s legislation section, Matt Gaines is a Partner in the Condominium Practice Group of the Braintree firm of Marcus Errico Emmer Brooks, P.C.  He focuses on the review and drafting of condominium documents, lien enforcement actions, the enforcement of rules and covenants, and fair housing and discrimination matters, including requests for reasonable accommodations/modifications. Matt can be contacted by email at mgaines@meeb.com.