By Dru Shields
Director of Sales, EnviroForensics®
Let’s face the facts, the dry cleaning industry has seen its fair share of environmental problems, which are very complicated and costly. Some Wisconsin drycleaners are fortunate to have access to a limited amount of funding for environmental cleanup, which is partially sustained by a tax on certain dry cleaning solvents. If their sites are eligible through the Wisconsin Department of Natural Resources’ (WDNR) Dry Cleaner Environmental Response Fund (DERF), this fund can bring financial benefits to drycleaners required to clean up their property in Wisconsin. There are a few limitations to consider, however:
- The DERF process is a reimbursement program that requires you to pay upfront for the environmental investigation and cleanup. Many drycleaners don’t have the money to pay for this work. We are even aware of several drycleaners who have had to take out business loans to make upfront payments.
- Over the past eight years, the DERF fund has run out of funding three times. This leaves drycleaners in a scary situation since it is a reimbursement-based program. DERF reimbursements are currently taking two and a half to three years to process, meaning that if you made a claim today for money you already spent, you might not be reimbursed until the end of 2020 or beginning of 2021. In the meantime, the WDNR has expressed no intention to slow down on its enforcement activities requiring continued investigation and remediation at impacted sites, despite the lack of available DERF funding.
- The DERF program requires a deductible payment that can exceed $35,000, and caps the amount of eligible funding for each site at $500,000. Many environmental cleanups at drycleaner sites exceed $500,000 and oftentimes can be double or triple that amount.
These are frightening facts for drycleaners relying on the DERF. The one financial solution that is still available for drycleaners trying to do the right thing by cleaning up their properties are historical insurance assets. In Wisconsin, Commercial General Liability (CGL) policies from before 1985 may very well cover dry cleaners for environmental releases. This means that if a dry cleaner can find its (or its predecessor’s) insurance assets, those policies could help pay for the investigation and clean up required by the WDNR. They would likely also protect you from any neighbors who could sue for environmental damage to their property.
Our Unique Advantage
We are the nation’s leading environmental engineering firm and the industry leader for cleaning up PERC contamination from current and former drycleaners. We have worked with small business owners just like you for over 20 years and have helped Wisconsin drycleaners since 2008. In fact, we are actively cleaning up over 100 drycleaner sites right now.
Our business-oriented strategy focuses on helping business and property owners locate and use old insurance policies to help pay for the environmental cleanup work, which does not require you to make payments upfront like the DERF. Our goal is to help our clients achieve Site Closure and free them from environmental liability by cleaning up soil and groundwater contamination with minimal out of pocket expense. In the instances where our clients also own the real estate, our process can help restore their property to fair-market value. We pride ourselves on fighting for our client’s best interests.
Our process is proven; we have countless satisfied clients. Please consider having a free and confidential conversation with John Neu, our Wisconsin Sales Executive to answer any questions you may have about our services. You can reach John at 866-888-7911 or by email at jneu@enviroforensics.com.