PLIA Announces New Revolving Loan and Grant Program for Contaminated Commercial Properties

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The Washington State Pollution Liability Insurance Agency (PLIA) has just announced a new revolving loan and grant program under which low interest loans of up to $2 million are available to install, retrofit, close or clean up underground storage tanks (UST’s) on contaminated commercial properties.  The grant or loan can be used on any site that currently has a UST, historically had a UST, or has impacts directly relating to a UST, including those from off-property UST sources.  The actual amount of the loan or grant will be determined by the scope of the work and the financial needs of the property owner.

The property owner may apply to PLIA any time, but the deadline to be considered for the calendar year’s award cycle is the first business day of March.  After the sites have been ranked by PLIA, a Preliminary Planning Assessment (PPA) will be conducted if there is insufficient data to evaluate the site.  Up to $150,000 is available to offset the cost of the PPA, which will be deducted from the total amount of financial assistance the owner is given.  In other words, the owner/operator is not required to repay the cost of the PPA.

After the PPA is completed and the site is ranked, the grant or loan will be awarded.  Financial disclosure prior to the loan will be required.  The minimum loan is $50,000 per site (for 9 or less sites), or $500,000 per applicant (for 10 or more sites).  The maximum grant/loan is $2,000,000.  It’s important to note that sites with no income or cash-strapped owners may qualify for a full grant.

Eight weighted factors are used to determine eligibility for the program and the amount of the loan.  In descending order they are:

  • Age of the tank(s)
  • Threat to public health
  • Extent of historical contamination
  • Insurance need
  • Financial need
  • Current insurance policy exceeded
  • Environmental justice
  • Community need/benefit

The program was created by 2016 legislation, which is codified at RCW 70.340.  Since it is brand new,  PLIA is reserving the right to change the process if necessary.  There will be a significant amount of paperwork associated with the loans and grants, but the effort can ultimately provide beneficial financial assistance to commercial properties contaminated by UST’s.


About the Authors

Michael Spence

Mike Spence co-chairs the real estate practice group at Helsell Fetterman. A significant part of his practice involves advising buyers, sellers, property owners and brokers all aspects of real estate including waterfront property issues.

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