You are about to purchase a property and you hear that the previous owner may have dumped chemicals in the “back 40”. How do you know what’s back there? Who is responsible for cleaning it up? What do I need to know if I want to redevelop this property? Can I participate in a Brownfields Program?
What is a Brownfields Program?
For more than 20 years, the Environmental Protection Agency’s (EPA) Brownfields Program has changed the way contaminated property is perceived, addressed, and managed. It is designed to empower states, communities, and other stakeholders in economic redevelopment to work together in a timely manner to prevent, assess, safely clean up, and sustainably reuse brownfields.
A brownfield is a property, the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant. It is estimated that there are more than 450,000 brownfields in the U.S. Cleaning up and reinvesting in these properties increases local tax bases, facilitates job growth, utilizes existing infrastructure, takes development pressures off of undeveloped, open land, and both improves and protects the environment. (www.epa.gov)
How can G2’s environmental experts help?
G2 Consulting Group’s environmental team are recognized land development experts who help clients navigate the Brownfield Redevelopment process quickly and efficiently. Many G2 clients have asked about the costs and benefits of a Brownfield Redevelopment program. Michigan’s Brownfield Redevelopment program is unique and powerful because it does not require any funding from the State. Costs incurred by the developer for “eligible activities” are reimbursed through tax increment financing (TIF). This is similar to the method that Downtown Development Authorities (DDAs) use to fund projects within a defined DDA area. In a Brownfield TIF, the increased taxable value resulting from the redevelopment is captured each year until the developer is reimbursed for the eligible activities that were approved. The capture period can extend up to 30 years; however, payback times of five to 10 years are more common.
The process begins with environmental due diligence, Phase I Environmental Site Assessment (ESA), Phase II ESA, and Baseline Environmental Assessment (BEA). Once the property (or multiple properties) is eligible, a Brownfield Plan is prepared and submitted to the local Brownfield Redevelopment Authority. All of the environmental costs associated with due diligence can be included as eligible costs in the Brownfield Plan including preparation of the plan itself.
Properties can qualify as eligible for the Brownfield program in a number of ways. They can be contaminated, blighted, or functionally obsolete. Any property held in a City, County, or State Land Bank is eligible, even if it would not qualify otherwise.
Eligible activities can be environmental or non-environmental. Environmental activities include all of the due diligence investigation, preparation of BEAs and Due Care Plans, remediation costs, installation of vapor barriers, and other due care measures that are required in order to redevelop the property. Non-environmental activities include asbestos abatement, building and site demolition, and in some communities, infrastructure improvements including parking decks and storm water systems, bridges, bike paths, marinas and other infrastructure that provides a public benefit.
Smart. Results. Fast.
G2’s environmental professionals dig deep to unearth surprises before they become your financial responsibility. We apply our engineering, geology, hazardous materials management and health and safety experience to design thorough assessments, and create flexible, efficient remediation and compliance strategies to define site risks, and to manage those risks.