The U.S. Air Force must reimburse homebuilders at the former Lowry Air Force Base the costs they incurred cleaning up asbestos at the redevelopment site, according to a decision by the U.S. Court of Federal Claims.
Five homebuilders sued the Air Force after spending $9 million to clean up land they purchased from the Lowry Redevelopment Authority, the quasi- governmental entity charged with redeveloping the former Air Force base.
Asbestos was discovered in the soil after the homebuilders bought the land from the LRA. The asbestos was traced to buildings that were previously demolished on the site.
With 22 military bases slated for closure by September 2011, the ruling sets a precedent for determining who is responsible for environmental cleanup costs, said Michelle Kales, an attorney with Brownstein Hyatt Farber Schreck who represented the homebuilders.
“As they close bases, more property will be transferred to private development,” Kales said. “It ensures that the transferees are not going to have to bear the cost of environmental cleanup that may not have been discovered prior to transfer.”
Two similar cases are pending, including one by the LRA, which spent more than $6 million cleaning up property where it was building infrastructure, said Durward Timmons of Sherman & Howard LLC, who is representing the LRA. The other is on a California naval base.
“The Air Force had basically given us a deed telling us it was clean property,” said Tom Markham, executive director for the LRA. “We dug it up, discovered it was contaminated and asked them to clean it up and pay for it. That’s what they refused to do.”
The five homebuilders that sued the Air Force are Richmond American Homes of Colorado Inc., Metropolitan Development IV LLC, Metropolitan Builders Inc., Standard Pacific of Colorado Inc. and Touchstone Homes LLC.
At the heart of the homebuilders and LRA’s claim is Section 330 of the National Defense Authorization Act, which requires the Department of Defense to reimburse those communities that incur cleanup costs as a result of prior DOD activities.
“Congress meant for this to be a sweeping protection of communities and people who take over these properties,” said Markham, immediate past president of the Association of Defense Communities, a national organization serving America’s defense communities.
“When the state directed us to clean it up, we did it. We also made sure this would never happen again by going through environmental privatization and making a deal with the Air Force to pay for future unknowns.”
Staff writer Margaret Jackson can be reached at 303-954-1473 or mjackson@denverpost.com.
