Remediation Funding Source
Purpose of RFS
The purpose of an RFS is to ensure that funds are available
to complete the remediation of a site if the person who is required
to conduct remediation fails to do so.
Who must post and when?
Owners and operators of an industrial establishment subject to ISRA must establish
an RFS and submit it with a Remediation Certification prior to the
sale or transfer of ownership or operations of the industrial establishment. An RFS is also
required, if not already established, upon an LSRP's certification of a remedial action
Any party who is liable pursuant to the Spill Act who is required via an Administrative Order
or Spill Act Directive issued by the Department or a Court Order requiring cleanup pursuant
to the Spill Act, or who executed an Administrative Consent Order with the Department which
included an RFS requirement or a person subject to Direct Oversight, must establish an RFS as
instructed by the Department or court.
What are the requirements?
Parties required to post RFS must comply with the RFS requirements
How to determine the amount of RFS
The amount of the RFS posted must be equal to or greater than the amount calculated in a cost estimate to complete the remediation, including the DEP
fees and oversight costs, and including the estimated cost to operate, maintain and inspect engineering controls. The definition of remediation costs provided at
N.J.A.C. 7:26C-1.3 should be used as a guide for items to be included in the estimate. Once financial assurance (FA) has been established as part of a Remedial Action
Permit the amount of the remaining RFS may be adjusted to reflect costs to remediate AOCs not included under the permit (see FA below).
1% RFS surcharge
Parties must pay a 1% surcharge on the amount of RFS required
to be posted, except when a self-guarantee is used. The surcharge
is due when the RFS is required to be established and annually
thereafter (see N.J.A.C.
Exemptions from the requirement to post RFS
Except for cases in Direct Oversight, a person responsible for conducting the remediation is exempt from the requirement to post RFS when:
(see N.J.A.C. 7:26C-5.2(b)).
- The person is implementing an unrestricted or limited restricted
use remedial action. The exemption ONLY applies to the area(s)
of the site where the unrestricted or limited restricted use
remedial action is being implemented.
- The site or portion of the site being remediated is within
an environmental opportunity zone. The exemption ONLY applies
to the area(s) of the site that is designated as an environmental
opportunity zone. Please see FAQ #4
for more information.
- The person is implementing an innovative technology. Please
see FAQ #5 for more information.
- The person is a government entity.
- The person is undertaking remediation at his or her primary
or secondary residence.
- The person is the owner or operator of a child care center
licensed pursuant to N.J.S.A. 18A:1-1, or a charter school established
pursuant to N.J.S.A. 18A:36A-1.
Direct Oversight Requirements for RFS
N.J.A.C. 7:26C-14 contains the requirements for persons responsible for conducting the remediation of a contaminated site under Direct Oversight, including the criteria
for who is subject to Direct Oversight and the remediation requirements for those who are subject to Direct Oversight. One of the criteria for remediating a site under
Direct Oversight is that the person responsible for conducting the remediation must post RFS in the form of a Remediation Trust Fund. The requirement for sites being
remediated under Direct Oversight include:
The amount of the RFS posted must be equal to or greater than the amount calculated in a cost estimate to complete the remediation, including the cost to operate,
maintain and inspect engineering controls, and DEP fees and oversight costs or an amount that the Department requires when it undertakes direct oversight. The definition
of remediation costs provided at N.J.A.C. 7:26C-1.3 should be used as a guide in items to be included in the cost estimate.
Unless otherwise adjusted in writing by the Department, the Department must approve in writing the amount of the funds to be disbursed or reduced in order for the holder
of the RFS instrument to disburse the funds.
- RFS exemptions provided at N.J.A.C. 7:26C-5.2(b) and financial assurance exemptions provided at N.J.A.C. 7:26C-7.10(c) do not apply to Direct Oversight.
Differences between RFS and FA
- RFS is for ongoing remediation whereas FA is for (OM&M) of the
- RFS can be used to pay for actual remediation costs, while
FA cannot be used to fund the (OM&M) of the engineering control.
- Cannot use self-guarantee for a FA mechanism.
- Do not have to pay a 1% surcharge for FA.
NJDEP has created a RFS
guide, as well as a list of FAQs for
Remediation Funding Source Coordinator
New Jersey Department of Environmental Protection
Site Remediation and Waste Management Program
Remediation Funding Source Unit
Mail Code 401-06X
P.O. Box 420
401 East State Street
Trenton, NJ 08625-0420