On November 17, 2025, the New Jersey Department of Environmental Protection (DEP) adopted, with substantial changes, rules to implement the 2019 amendments to the Site Remediation Reform Act, first proposed on January 31, 2025.

Perhaps the most controversial part of the proposed rules, the proposed due diligence reporting provision, which threatened to upend environmental due diligence related to commercial real estate transactions in New Jersey, was not adopted now. Rather, following public comment, the provision has been withdrawn and reproposed, effectively punting the issue to the next administration.

As originally proposed, the sweeping new reporting provisions, proposed at N.J.A.C. 7:26C-2.4, would have required that any discharges discovered during due diligence be immediately reported to DEP by the potential purchaser. Further, whenever “any person” obtained knowledge of a discharge at any location on a property, that person would have been required to immediately notify the DEP and the seller.

The reproposed version of the rule is difficult to meaningfully distinguish. The reproposed version of the rule requires the potential purchaser to notify the seller of a discharge discovered during “all appropriate inquiry in accordance with N.J.S.A. 58:10-23.11g,” but not the DEP. The “any person” language was also deleted. In practice, if the potential purchaser’s data is valid, then pursuant to N.J.S.A. 58:10-23.11e, upon notification by the potential purchaser the property owner will be obligated to report the spill to DEP immediately. Thus, the DEP reporting requirement has been shifted from the potential buyer to the potential seller — without addressing the two underlying issues identified by commenters to the initial version of the rule.

First, commenters stated that DEP does not have a statutory basis for requiring reporting from potential purchasers. With regard to dischargers, DEP regulates persons liable for discharges and LSRPs (who are currently only required to report discharges at sites where they have been retained or where they encounter substantial risks known as immediate environmental concerns). DEP’s jurisdiction does not extend to imposing reporting obligations on other persons with knowledge of a discharge. In fact, the legislative history of the Site Remediation Reform Act reveals that the DEP requested a broader reporting requirement, and the legislature declined to accommodate that request. For these reasons, commenters stated that the proposed reporting obligation may not survive judicial review.

Second, many commenters stated that requiring reporting of due diligence findings will chill property transfers. In short, DEP’s proposed reporting requirement will create the risk of triggering a remediation obligation by the owner if the transaction does not close. As a result, brownfields could become warehoused rather than redeveloped to avoid the risk of triggering costly remediations without the incentive of an economic benefit from redevelopment. Furthermore, the proposal encourages property transfers without due diligence, which imposes undue risk on buyers and is contrary to the innocent purchaser framework established in the Spill Act and federal law. Arguably, the rule could also increase transaction costs by encouraging pre-due diligence investigations which are not conducted in accordance with N.J.S.A. 58:10-23.11g, and that are intended to side-step the reporting obligation.

DEP will hold a virtual public hearing on Wednesday, December 17, 2025, at 1:00 pm. A Microsoft Teams link to the meeting is available on the DEP website. Written comments may be submitted until close of business on January 16, 2026 at https://dep.nj.gov/rules/rule-comment-form/, four days before the next administration inherits this issue.

For more information on environmental regulation, please contact the authors of this blog post or CSG Law.