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Brownfield Regulation

One of the biggest and most unwanted surprises a new business can get is to find out that they just built their new factory on a spot that had been used decades earlier to dispose of hazardous materials. The way many environmental laws are written, it wouldn't matter that the new business had nothing to do with the contamination; it would be legally required to clean it up. It is for this reason that the thought of purposely building on sites with lurking environmental issues is difficult to imagine. However, the reuse or recycling of these areas for industrial space has become not only an important tool in the preservation of green spaces, but in containment of urban sprawl.

The term "brownfield" is defined by the EPA as real property, "the expansion, redevelopment, or reuse of land which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant." While the potential for serious contamination is real, according to the EPA only a handful of these properties are truly beyond reclamation. A few cases of serious environmental contamination have received so much national media attention that the remainder of cases has received a reputation that is simply not deserved. The GAO estimates that nearly half a million brownfield sites exist. Less than ten percent of those sites had historical uses that may be considered to pose a serious enough threat to require comprehensive testing to rule out the existence of a hazardous risk. In the end, only one percent are found to pose a problem, the magnitude of which justifies being slated for federal clean up under Superfund legislation. That means that virtually 99% of brownfield properties can be rehabilitated and reused without much difficulty.

The EPA realized that getting these properties back in use was in the best interests of their respective communities. This desire to contain development and preserve non-contaminated areas and greenspace has lead to the creation of incentives by local, state, and federal government agencies to encourage the reuse of these properties. Revitalized waterfronts, industrial parks, and warehouse districts that were once abandoned are now energetic, financially viable properties again. Almost every state has a collection of success stories fostered by brownfield regulation incentives. Many developers have found that it is easier than they anticipated when beginning construction in brownfield areas for a number of reasons. First, the land is often substantially cheaper than are so-called pristine "greenfields" elsewhere. Equally as important, property that is to be put to use for industrial purposes can benefit from the fact that the infrastructure in these previously used areas is usually already in place. It is likely, railroad lines served the previous occupant of the land along with trucking routes, shipping docks or waterfront access. Also, the community that has been plagued with the idle land is often in a position to be more lenient with the licensing and permit process. After all, they see that any re-development of abandoned industrial space provides, not only an aesthetic improvement to the area, but financial stimulus as well.

Not all spaces with a history of contamination are eligible for reuse under the brownfield programs. The driving force in the use of brownfields is the sense that the renovation will protect human health and improve the environment through economic development or the creation of parks, greenways, recreational property, or property used for nonprofit purposes. If the reuse poses too great a hazard to human occupation, obviously, no matter how great a bargain or how high-minded the use, development will be blocked. Properties that were exposed to serious chemical contaminants, such as PCBs or radiation, or properties that may have had problems associated with leaking underground storage tanks for petroleum or other chemical products remain unusable.

Once a site has been chosen for redevelopment, an assessment must be made to define the clean-up plan for a designated area. During a site assessment a technical expert will determine the type and extent of site contamination in two phases. Phase I involves gathering the basic information on the site using historical records, maps and other sources. If the findings at that point favor proceeding, the project enters Phase II. Phase II is more hands-on and includes sampling of the soil from site.

Tax incentives for re-utilizing brownfields over greenfields can be substantial. The costs associated with cleaning up a qualified site are fully deductible the year in which they are paid. Communities endeavoring to promote reuse may offer grants, low-cost loans, and/or technical assistance to complete the process. Areas of development located in particularly economically-depressed areas receive federal tax breaks and may be eligible for other tax incentives. More information on the choice of sites and federal programs may be found at the EPA's website for brownfields at http://www.epa.gov/brownfields.

If you are considering factory operations and are concerned with limiting the impact your business may have on the environment, you may wish to consider whether qualified brownfields can be found in your area. Compliance with all of the requirements of the program is critical in order to obtain tax benefits, as well as to document your efforts in cleaning up any contaminants from the land. Therefore, it is important to coordinate your work on the land with a qualified attorney who can help you through the process and assure that permits and inspections are completed as required. The right attorney can also ensure that you qualify for all the benefits to which you are entitled for using the brownfield.

It is important to remember that any development process has a number of prerequisites. Every project is going to have development concerns and costs associated with preparing a site for development. So, while it may seem a daunting task to plan your expansion using potentially contaminated property, with some effort, you may that find you are able to help your community by cleaning up a discarded area, bringing economic stimulus to an economically depressed area while receiving economic incentives and community support to do it.

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Brownfield Regulation

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