The original law, the Coastal Zone Act of 1971, was intended to protect the state’s natural environment and its economically important tourism industry from the threat of pollution from operations like steel mills or oil refineries. Existing operations continued under the law, but it prevented new ones from starting. Environmentalists have fiercely defended the law in the decades since.
The new bill would amend the law by allowing most kinds of industrial development but would require new owners to take responsibility for cleaning up toxic residue at many of the sites. The plan would affect about 2 percent of the overall Coastal Zone, which extends two miles inland along 115 miles of coastline. It would retain a ban on new refineries, pulp and paper mills and incinerators.
Any buyers would have to provide financial assurances that the cleanup, called remediation, will continue even if their businesses do not. And they would have to show that their sites will be resilient to sea-level rise in the low-lying state.
At nine sites with existing docks, companies would be allowed to transfer bulk products that are produced in or used by businesses in the Coastal Zone. Environmentalists say that loading or unloading materials like edible oils or chemicals runs the risk of spills. Any such spill could damage Delaware’s economically important tourism industry, which is seeking to attract more visitors like bird-watchers to undeveloped coastal sites, environmentalists say.
Prospects that the law would be changed for the first time in its 46-year history rose on June 20 when the House voted by 34 to 7 in favor of the bill, sending it to the Senate just before the end of the legislative session on Friday.
The bill has the support of Delaware’s Democratic governor, John C. Carney Jr., who is trying to fill a $400 million budget deficit for the coming year. He told lawmakers in March that revision of the Coastal Zone could create badly needed jobs.
But critics say the plan would expose the coastline to renewed contamination from industrial activities.
Kenneth Kristl, an associate professor of environmental law at Widener University’s Delaware Law School, said the provisions on bulk product transfer risked spills of contaminants and ran counter to the existing law.
“When you are loading and unloading boats on the river, you pose the danger of releases, spills, accidents, and it encourages the development of satellite industries that in themselves create environmental problems,” Mr. Kristl said.
Matt Del Pizzo, president of the Delaware Audubon Society, argued against changing the current law, which he said had done a good job of protecting the state’s coastline. He predicted that developers would be unwilling to pay the high cost of remediating sites that have been contaminated with toxic materials.
“For business to come in and do those kinds of costs even before they start is going to be a heavy burden,” Mr. Del Pizzo said. “To say that this is going to be a great opportunity for those businesses is a bit of a stretch.”
Among the sites that would be opened up for development is a 65-acre parcel near Delaware City, a federal Superfund site where a chemical plant existed for about 35 years until going bankrupt in 2002. It is contaminated with benzene and toluene, both hazardous materials, said Tim Ratsep, a program administrator for Delaware’s Department of Natural Resources and Environmental Control, which is cleaning the site.
The cleanup has cost taxpayers $2.4 million so far and will cost the state $500,000 to $800,000 a year “in perpetuity” to prevent remaining contaminants from spreading into surrounding groundwater, Mr. Ratsep said. Any transfer of that liability to a private buyer would be subject to negotiation, he added.
The state is paying for the cleanup of that site because there is no “viable” private entity to do so, Mr. Ratsep said, but nine of the other sites are being remediated to state or federal standards at the expense of current or former owners. Any buyers would be required to clean a site to a higher standard if pockets of contamination are found, according to the bill.
Business leaders and state officials were reluctant to say how much interest developers had shown in any of the sites.
Cerron Cade, acting director of the Delaware Economic Development Office, a public agency that has been in touch with potential developers, said he knew of more than 30 companies, including a concrete manufacturer and a yacht builder, that had considered setting up in the Coastal Zone over the last five years but had withdrawn because of the existing law.
It was unclear whether any of those companies would reconsider locating in the zone if the bill passes, Mr. Cade said, but there have been promising signs. “We’ve seen some optimistic interest in the path that we are going on,” he said.
The success of any Coastal Zone revision will depend on the value of individual sites and whether they justify the cost of cleanup, said David Scolnic, a commercial real estate lawyer with the Philadelphia firm Hangley Aronchick Segal Pudlin & Schiller.
The cleanup cost can be offset by “sophisticated developers and sophisticated environmental consultants,” Mr. Scolnic said. “It’s not impossible.”