Mayors' Comments on Redevelopment of Brownfields

Linda C. Beresford
McKenna & Cuneo, L.L.P.

Over the past several years, everyone involved in community planning, environmental issues, and construction and development has come to recognize the need to redevelop "brownfields." Attention this issue has received from mayors of both the largest and smallest cities of the United States is evidence that there is value in utilizing either abandoned or blighted properties historically avoided due to the existence of known or suspected contamination. In February 2000, the United States Conference of Mayors released the Third Annual National Report on Brownfields Redevelopment.

To compile this report, the U.S. Conference of Mayors distributed a "Brownfields Survey" to participating mayors. The Conference defines the term "brownfield" as "an abandoned or underutilized property where expansion or redevelopment is complicated by either real or perceived environmental contamination." The survey asked questions such as how many brownfields sites are in the city, what is the total number of brownfields acres, what are the most common impediments to their redevelopment, would additional monetary assistance be helpful in this redevelopment, and what are the potential local tax revenues and numbers of jobs that could be generated if these sites were redeveloped.

The report is a compilation of information provided from 231 cities from 42 states as well as Puerto Rico and the District of Columbia. The cities that contributed responses ranged in population sizes from 1,468, to 7,380,906, "proving once again that the problem of brownfields affects cities of every size." The primary findings include: 1) 210 cities estimated that they had a total of 21,178 brownfield sites; 2) 201 cities estimated that brownfields consumed 81,568 acres of land; 3) 62 percent (144) of respondents were from cities with less than 100,000 people, which accounted for 3,049 brownfield sites (14% overall) and 27,223 acres (33% overall).

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Respondents estimated that a total of $878 million to potentially $2.4 billion annually could be generated in local tax revenues if the brownfields were redeveloped.

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The most frequently identified impediment encountered in redeveloping brownfield sites was lack of cleanup funds, cited by 90% of the cities. Additionally, 176 cities or 76% of the respondents said that their cities had brownfield sites that would require additional subsidies in addition to cleanup and assessment grants in order to attract private investments. The types of resources needed included: low interest loans and infrastructure improvements such as roads and sewers, demolition monies, aid in acquisition and assembly of land, environmental tax increment financing ("TIFs"), state brownfield redevelopment funds and monies to market brownfield sites. These are also the same types of local incentives employed by the cities to attract developers.

Respondents were also asked to identify the four most important benefits to their city if their brownfields were redeveloped. The most frequently cited benefit was increasing the city’s tax base. Respondents estimated that a total of $878 million to potentially $2.4 billion annually could be generated in local tax revenues if the brownfields were redeveloped. The other most frequently cited benefits to redevelopment were job creation, neighborhood revitalization, and environmental protection. Respondents for 189 cities estimated that 554,419 new jobs could be generated if their brownfield sites were redeveloped.

Opening comments from the mayors involved in the various task forces such as the Brownfields Task Force also identified the need to utilize brownfields in order to preserve farmland and open spaces. "The latest U.S. Department of Agriculture statistics confirm what many Americans already suspect: the impact on sprawl on rural land is getting worse. On average over three million acres of rural land was developed each year between 1992 and 1997, more than doubling the 1.4 million acres lost per year from 1982 to 1992. American Farmland Trust calculates that fifteen percent of all land developed in our history as a nation was developed in the most recent five-year period." Lee R. Clancey, Mayor of Cedar Rapids. Hand in hand with this issue is the need to utilize existing infrastructure. "Cities, states, and the federal government have invested billions of dollars in our current infrastructure. It's just plain common sense that we utilize this infrastructure to its fullest potential before building more roads, sewers, and utilities elsewhere which equate to higher taxes." Anthony Masiello, Mayor of Buffalo.

Following the report’s findings is a sampling of narratives submitted by the cities discussing their various brownfields projects. As identified earlier, the greatest impediment to redeveloping brownfields is the lack of funding to either acquire or clean up the sites. The narratives were striking in that the vast majority of projects were funded by cities that had received grants from either federal, state or, occasionally, local sources. The secondary source of funding appeared to come from cities themselves, that acquired the sites and assumed responsibility for any necessary environmental assessment and cleanup. The last source of funding, in what appeared to be a distant third, was recovering the cost of the cleanup from the responsible parties. Whether this was due to the responsible parties having disappeared or being bankrupt, or due to the lack of either local or state statutory support to collect these funds, was often not identified in the narratives.

Another clear trend was that the vast majority of cities were using available funds to conduct Phase I and Phase II Site Assessments. Multiple cities stated that old industrial properties were not utilized due to fears that the properties were contaminated, or due to the unknown expenses associated with the remediation. A common theme was that if the cities were able to conduct site assessments, the results either indicated that in fact there were no environmental problems at the sites, or the cost of remediation became a known and economically viable option which could then be incorporated into a development proposal or an acquisition price.

The last noted trend was that many cities are creating partnerships with either the federal Environmental Protection Agency, or often the state and/or local environmental agency, to come up with funds and grants. However, another significant purpose for these partnerships is to create practical and risk-based remediation plans to minimize the cost of assessment and remediation, presumably so that only that amount of remediation necessary for the projects is accomplished. With this cooperative and use-based approach is often a state program which issues certificates of completion limiting liability for the issues addressed by the remediation efforts, another practical benefit for both cities, and potential developers.

Redevelopment of brownfields is an issue which affects the entire nation and significantly impacts local economies and problems associated with land use. It is optimistic to see that not only are both the federal and state governments recognizing the need to continue funding for these projects, but that cities and local administrators have used these funds smartly and efficiently. We can only hope to see this trend continue, perhaps also in combination with continuing legislation that makes it easier and more efficient to recover costs from responsible parties. A copy of the entire report from the United States Conference of Mayors can be located at www.usmayors.org/.