A restrictive covenant is a stand-alone document or a clause in a deed that limits or restricts future land uses. If remedial actions are completed at a facility for a category of cleanup other than unrestricted residential use, the party conducting the remedial action may develop and record a restrictive covenant or other acceptable institutional control mechanism to ensure the effectiveness and integrity of the remedy, and where contamination has been left in place, to ensure that potential exposures are controlled. For instance, if corrective action has been completed at a site and the level of contaminants in the groundwater are in excess of drinking water cleanup criteria, the responsible party may prepare and record a restrictive covenant which prohibits the use of potable water wells on the property, thus limiting the risk of potential exposure to contamination remaining in the groundwater.
In Michigan, the Michigan Department of Environment, Great Lakes, and Energy (EGLE) has developed a specific form and format for restrictive covenants that must be used in conjunction with response activities. Within 30 days of recording the restrictive covenant with the County Register of Deeds, a notice must be provided to the EGLE and the local zoning authority regarding the existence of the restrictive covenant. In certain instances, a restrictive covenant must be submitted to the EGLE for approval prior to recording with the Register of Deeds.
Another institutional control mechanism that is sometimes used in lieu of a restrictive covenant is a local ordinance, provided the local governmental unit has approved this participation and the EGLE has approved the terms of the ordinance. Some local governments have developed specific groundwater restriction ordinances that prevent the installation, operation, or existence of groundwater wells within a specific geographic area, thus limiting potential human health exposures.
We have extensive experience in drafting effective restrictive covenants, and have worked with both local governments and responsible parties in the development of ordinances for use as institutional controls. If you have any questions or need assistance, give us a call.