Connecticut brought together 60 to 70 stakeholders — including environmental attorneys, licensed environmental professionals, consultants, and municipal representatives — who met monthly from December 2020 through May 2025 to draft regulations replacing the state’s longstanding Transfer Act. The process was exhaustive and detailed. While the group quickly agreed on major principles, such as moving from the Transfer Act to a release-based system, one unresolved issue may prove to be the new system’s biggest challenge: how to handle legacy sites that predate the new regulations.
Brendan Schain, Partner at Shipman & Goodwin and the primary drafter of the release-based cleanup regulations, says the working group spent years on details that proved far more complex than expected. He describes the overhaul as a “generational shift” and acknowledges that the new program’s scope and requirements introduce significant uncertainty about how it will function in practice.
The new regulations attempt to draw a clear line: properties already subject to the Transfer Act remain under that law. In contrast, newly discovered contamination on other properties falls under the new release-based system. This approach was designed to prevent legacy sites from being moved into a more lenient framework. However, this separation has instead created confusion and practical difficulties.
Why Legacy Sites Remain a Challenge
Many properties have been under the Transfer Act for decades. Some have incomplete or missed filings. Others have environmental releases that technically require remediation due to their age, while some do not, depending on when the property last changed hands. The regulations do not provide definitive answers for every scenario, leaving property owners and regulators to interpret which rules apply.
Schain notes that there are “a lot of questions about how legacy Transfer Act sites will move into the system.” He points out that longstanding sites often have a mix of missed filings and outstanding releases, making it unclear which cleanup obligations remain.
This complexity was not entirely unexpected. Lawmakers made statutory changes to address the issue, but the underlying problem persists: each site presents unique circumstances that regulations alone cannot fully address. Schain concedes that the confusion is not due to a failure of statute or regulation, but rather the sheer variety of site histories and fact patterns. “There’s a long legacy. There are a lot of sites. They’re all a little bit different,” he says.
The central question now is whether the market will develop consistent practices for handling these gray areas, or whether Connecticut will face years of disputes over which cleanup regime applies to which property. This uncertainty could discourage buyers and lenders from engaging with properties with Transfer Act history, even if the new rules were designed to make transactions easier.
How Consensus Was Reached
The Transfer Act has been amended nearly every year since its adoption, usually to narrow its scope. In 2017, a study prompted by commercial realtors led to a legislative working group that proposed further changes. At that point, Schain says, stakeholders recognized the need for a more fundamental overhaul.
In September 2020, the legislature authorized the move to a release-based cleanup system and created a working group to advise the Connecticut Department of Energy and Environmental Protection (DEEP) on the design of the new program. Schain, then legal director for DEEP’s environmental quality branch, helped lead the effort and drafted the regulations.
Schain describes the Transfer Act as “a product of the time in which it was adopted,” noting that today’s real estate market is driven by the need for buyers, sellers, and lenders to understand and manage environmental liability.
The working group looked to Massachusetts as a model and quickly agreed on the general direction. However, translating broad principles into detailed regulations took years. The group debated the thresholds for triggering reporting requirements, appropriate timelines, the scope of exemptions, and the clarity of procedural steps.
Schain recalls that consensus on the main components came quickly, but “there was a lot of work to do around the details.” The process dragged on because the stakes were high and the impact broad. “Change can be very hard,” he says. “It’s a big change, and it has a lot of impact on a lot of different stakeholders. And so it took a long time.”
Key Issues to Watch
As the release-based system is implemented, Schain identifies three areas where confusion is likely to arise. First, there will be disputes over whether an environmental investigation has actually discovered a release. Determining whether contamination meets the numeric lower bounds for exemption or whether a release is established through multiple lines of evidence will require careful interpretation.
Second, questions will emerge around the timing and sharing of due diligence. Buyers and lenders may conduct Phase Two environmental site assessments, but how and when that information is shared with property owners — and how it triggers reporting and cleanup obligations — remains uncertain.
Third, ongoing cleanup efforts on legacy Transfer Act sites could be slowed by ambiguity over which properties remain subject to the old law and which fall under the new system. Schain notes that clarity on this point is still lacking, which could prolong or complicate remediation efforts.
Shipman & Goodwin is positioning itself to help clients navigate these complexities by drawing on Schain’s experience with the regulations and the stakeholder process. The firm’s environmental practice also includes Aaron Levy, who participated in the working group. As the market adapts, firms with regulatory drafting experience may have an advantage in interpreting ambiguous provisions and anticipating how the state will enforce new rules.
The Next Phase
After five years of stakeholder meetings and regulatory drafting, Connecticut has a new environmental cleanup framework. But the legacy site problem remains unresolved. The state now faces a test: will the new system provide enough clarity to make transactions smoother and cleanups more efficient, or will the unresolved ambiguities around legacy sites lead to litigation, regulatory challenges, and market hesitation?
The outcome will shape Connecticut’s environmental and real estate landscape for years to come. If the market and regulators can develop practical solutions for handling legacy sites, the release-based system could deliver the intended benefits of predictability and flexibility. If not, the state risks replacing one set of complications with another, and the legacy site problem may continue to stall deals and slow environmental progress.
In the coming 18 months, how Connecticut addresses these gray areas will determine whether the transition away from the Transfer Act is seen as a success — or as a well-intentioned effort that left some of the toughest problems unresolved. Buyers, sellers, and environmental professionals will need to watch closely, as the answers will shape both the state’s environmental outcomes and its economic development prospects.
