The Merits of Brownfield Redevelopment - Case Study Example

The Merits of Brownfield Redevelopment By Leonard Morlino MALS 4020 Graduate Research andWriting- CRN 4384 University of Denver University College Professor John Woodling -Instructing 1 Introduction "We're using old industrial assets - our canals, mills, factories, warehouses - once left to rot - now brought back to life. Providing new workspaces, new communities, and all on Brownfield sites so that we've met our 60 per cent target for all new homes on Brownfield land - eight years early."(Deputy Prime Minister, John Prescott, September 29, 2003) Most of the regions of the United States have been experiencing demographic shifts in economic activity from urban areas to suburban locations and inter-regional migration from the Northeast and Midwest to the South and West which has contributed to economic decline. This shift along with the overall trend away from heavy industry and other types of manufacturing have left many old industrial areas idle, underutilized or completely abandoned. The General Accounting Office estimates that between 130,000 and 425,000 Brownfield sites exist nationwide. (David.R. Allardice, 1995) (1) In fact, many sites are not in the real estate market adds to the difficulty of quantifying them. As the economic decline of cities gain national interest, the federal, state and local governments are began some initiative process by examining policies with regard to analyze the barriers and incentives for redevelopment of Brownfield sites and developing strategies to address these impediments. But in fact, these implementations turns into an impinge on other factors like social- Those associated with benefiting low income and minority populations, Environmental - Those related to human health and environmental benefits and economical- Those affecting the generation of business, tax revenues, ad jobs positively. (US EPA 2006) Brownfield land gained political significance after ------------------------------------------------------------------------------------------------------------ 1. Allardice, David R. et al. "Brownfield Redevelopment and Urban Economies," Chicago Fed Letter. The Federal Reserve Bank of Chicago, Chicago, Illinois, 1995 2. An Integrated Approach for Brownfield, Smart Growth Network, Urban and Economic Development Division Office of Policy, Planning and Evaluation, U.S. Environmental Protection Agency Sep.2006 2 the Government set a national target in February 1998 to ensure 60 per cent of all new developments were built on Brownfield land. (National Land Use Database, 2003)(3) The study shows that the allocation of such idle land for reconstructing stimulates social, economic and environmental factors. In this context, a study on the benefits/merits of Brownfield redevelopment may help better evolution of this area .Before threshold in to this, an overlook on the meaning of this aspect, the general framework and criteria for identifying Brownfield site redevelopment opportunities and developing strategies for successful Brownfield redevelopment etc. can be outlined. Brownfield land In narrow sense, we can say a 'Brownfield' land is an area of land or premises that has been previously used, but has subsequently become vacant, derelict or contaminated. In broad sense these are the sites which found in cities and towns across the country, are abandoned, vacant, derelict, or underutilized commercial and industrial properties where past actions have resulted in actual or perceived contamination and typically require preparatory regenerative work before any new development goes ahead, and can also be partly occupied. This term derived from its opposite, undeveloped or 'Greenfield' land. It is to be remembered that Brownfield's differ from other contaminated sites as they have good potential for being cleaned up and redeveloped for productive use. As part of its mission to protect human health and the environment, the U.S. EPA is dedicated to revitalizing all types of contaminated land to productive economic and green space use. (S.L. Bezer and B.S. Phillips,, 1990) (4) In other words, Brownfield's are real property, the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous ----------------------------------------------------------------------------------------------------------- 3. National Land Use Database, 2003 4. Bezer S.L. and Phillips, B.S. "Contaminated Property Valuation Issues: An Overview," Industrial Development, Vol. 159, No. 3, pp. 1-2, June 1990. 3 substance, pollutant, or contaminant, cleaning up and reinvesting in these properties takes development pressures off undeveloped, open land and both improves and protects the environment. As said before, the framework of redevelopments intended to integrate economic, environmental and social factors, thus guiding Brownfield redevelopment strategies in a way that achieves the multiple objectives .These objectives are; 1. Engender investment in areas which ultimately provides increased tax revenues and jobs, 2. Trim down human health and environmental risk, and 3. Benefiting low income and minority populations by revitalizing their neighborhoods. Naturally here the question arises that the accumulating the waste materials during the process of redeveloping may harm to the day to day life. But the government, whether it is state or federal has taken appropriate measures as well as enacted some legislation on behalf of this. The law enacted various provisions to effect the redevelopment, in which Comprehensive Environmental Response, Compensation, and Liability Act, otherwise known as CERCLA or Superfund plays a crucial role. (5) The Act encircles with the directives of creating a tax on the chemical and petroleum industries and provided broad federal authority to respond directly to releases or threatened releases of hazardous substances that may endanger public health or the environment. Later this Act was amended by "the Brownfield's Law" by providing funds to assess and clean up brown fields; clarified CERCLA liability protections; and provided funds to enhance state and tribal response programs. Other related laws and regulations impact Brownfield's cleanup and reuse through financial incentives and regulatory requirements.(6) ------------------------------------------------------------------------------------------------------------ 5. Comprehensive Environmental Response, Compensation, and Liability Act 6. On January 11, 2002, President Bush signed the Small Business Liability Relief and Brownfield's Revitalization Act Pub .L.No. 107-118, 115 stat. 2356, "the Brownfield's Law" 4 More over the Environmental protection authorities has been given power to control hazardous waste from the generation, transportation, treatment, storage, and disposal of hazardous waste.(7) The nature of the Brownfield redevelopment efforts also varies remarkably across the cities. For e.g. Trenton, a city of 89,000 people located in central New Jersey along the Delaware River, was a thriving manufacturing and industrial center in the late 1800s and early 1900s. Since that time, the city has experienced decades of economic and social decline. Recently, community development organizations have become more active in developing affordable housing and community gardens. The studies show that Trenton's Brownfield redevelopment efforts focus on sustainable community development that actively involves residents in site selection and land-use planning. But in Portland, a city of approximately 800,000 people is experiencing tremendous economic growth while maintaining a healthy environment. Since the 1980s, however, much of the job and population growth has been in suburban locations. The main objectives of Portland's Brownfield redevelopment efforts are to protect green fields in the outlying areas from development and to revitalize some of the neighborhoods in Portland where unemployment and poverty are most prevalent. (US EPA 2006)(8) Merits /Benefits of Brownfield redevelopment It is obvious that Brownfield can pretense a number of threats to a community's well being. Brownfield sites may cause potentially harm human health and the environment and it attract hooligan, open dumping, or other illegal activity that can lead to "urban blight". Moreover, there may lower surrounding property values and contribute to neighborhood deterioration. A shrivel in rate of local employment opportunities and tax revenues and limitation in economic growth and development are also the result of such fields. Apart from this, Brownfield contribute to urban sprawl as businesses and ------------------------------------------------------------------------------------------------------------ 7. Resource Conservation and Recovery Act (RCRA), 1986 8. US EPA 2 5 residents relocate to farmland and open space outside the existing urban area, also known as "green fields". Hence a redevelopment in this area indisputably manifests that the upshot of such developments should be the benefit of the community. Brownfield redevelopment in Trenton, New Jersey (9) If we take the example of city of Trenton, New Jersey in this regard, in 1993, the city expanded its Brownfield redevelopment efforts to areas of the city outside the UEZ. At the same time, under the direction of the New Jersey Department of Environmental Protection (NJDEP) and Isles, a non-profit community development organization based in Trenton, another Brownfield effort was taking place. The main purpose of this effort was to develop a strategy to involve surrounding neighborhoods in cleanup and future land-use plans for Brownfield sites in Trenton, through a pilot site redevelopment effort.(US EPA 2006)(10) As part of the pilot effort, the city has selected four focus Brownfield sites, for cleanup and redevelopment. 1. Magic Marker Site where the manufacture of pottery, lead battery and felt tip pen manufacturing operations. The site is located in the middle of a residential community; adjoin to a privately owned vacant lot on the west side, an elementary school across the street, and single family houses on the two other sides. Cleanup plans for this site are underway. 2. Champ ale Brewery Site which is a prime real estate property and it is located along the waterfront. Redevelopment of this site will likely be mixed-use, including restaurants and apartments. A marketing study will help evaluate potential redevelopment options and interested parties. 3. Thropp Brothers Site: This two acre site has been used by various manufacturing businesses, including a tool and die facility and a machine manufacturer. The site is near ------------------------------------------------------------------------------------------------------------ 9. Trenton Department of Housing and Development Trenton, New Jersey Brownfields Demonstration Pilot Program, February 28, 1995. 10. US EPA 2, 8 6 the city's largest elementary school. Redevelopment plans for the site are community-based and may include a playground for the nearby school and residential development. 4.Crane Site : This property is a large land parcel ,approximately nine acres, with no buildings, used at one time by the Crane porcelain company in the manufacture of toilets, sinks and bath tubs, It is bordered by a poor neighborhood and nearby school. From the above it can be noted that the city of Trenton the city's focusing into promote sustainable community development that actively involves residents in site selection and land-use planning. The types of Brownfield redevelopment most likely to provide sustainable community improvement in Trenton are residential, parks and open-space uses, neighborhood services, and limited commercial and industrial uses. Under these perspectives, it is momentous to specify the notions of advocates of Brownfield revitalization on many potential benefits. 1. Environmental benefits The environmental benefits of reducing the spread of urban sprawl and curtailing traffic congestion, related air quality problems, and other forms of environmental degradation is main merit of redevelopment process.(US Dept. of Agriculture,1996) (11) Moreover remediation of contaminated sites will help protect the environment and health of people particularly those living or working near them. . It also reduces society's tendency to develop agricultural or ecologically sensitive land. (NTREE, 2007)(12) 2. Economic benefits It include relocating jobs back to the central city, providing employment for dislocated workers and minority populations, and creating additional tax revenue. It is put forwarded that Brownfield redevelopment could encourage further central city revitalization efforts. For example, Brownfield sites located along urban waterfronts and -----------------------------------------------------------------------------------------------------------11. Brownfield and Their Redevelopment, The Ohio State University, The United States Department of Agriculture, NDAA, and County Commissions Cooperating,1996 12. Brownfield Redevelopment, NRTEE, Canada, Winter review, 2007 7 adjacent to downtown centers may be well positioned for development of retail and entertainment. In addition, Brownfield revitalization makes use of existing roads, utilities, and other infrastructure instead of using tax revenues and other public resources to extend the same services to new development in outlying areas. (US Dept. of Agriculture, 1996) (13)Brownfield remediation opens these sites for economic use instead of a comparable Greenfield. It indicates that new economic development in the area can provide community benefits. 3. Social benefits Redevelopment has potential for job creation, neighborhood revitalization, improved aesthetics, and other business opportunities. Lands which are under redevelopment provide desired community services such as health centers and grocery stores to benefit communities. These types of benefits are more likely for projects that include public participation in the cleanup and redevelopment plans. Moreover it helps to increase in easily accessible services which can apply to commercial development as many inner city neighborhoods do not have easy access to grocery stores or other important amenities. Increases in tax revenues generated by redevelopment may enable the city to provide better public services like schools, transportation, recreation etc. (US EPA 2006) (14) 4. Helps Job creation It can not be said that Jobs created by the redevelopment may benefit the local community if residents do not have the necessary education or training to fill these jobs. The redevelopment project may need to be coupled with education or job training. Moreover it causes improving labor market efficiency as increasing urban bag more job opportunities to city residents, thereby reducing job search costs, labor market search costs, and relocation costs. ------------------------------------------------------------------------------------------------------------ 13. US Dept. of Agriculture, 10 14. EPA 2, 8 8 4. Reduce in poverty /unemployment rate The studies shows that the areas meet certain socioeconomic eligibility criteria, including poverty rate, area size and general distress indicators suggests that the development may cause the shrinking in poverty rate. Moreover a high and increasing unemployment rate indicates that job creation may be an important benefit of redevelopment. 5. Neighborhood stability Population loss in an area indicates that the neighborhood may be declining; here redevelopment may help to prevent and possibly reverse such decline. Redevelopment in stable neighborhoods with active community groups is more likely to be successful due to the participation and investment of area residents. 6. Ground water protection and flood risk reduction Due to reduction in urban sprawl; Greenfield development replaces absorptive land with impermeable surfaces and treated lawns which can prevent clean rainwater from flowing into aquifers and streams. 7. Ecosystem and wetland restoration Redevelopment plans may also include wetland restoration and protection within urban areas, also due to curbing urban sprawl. The redevelopment creates green spaces which can be applied to apply to parks, open spaces, and community gardens redevelopment. 8. Increase in property values Even though it is not desirable that increase in property value causes in higher taxes and rents ,it help to increase owners assets and the city's tax revenues in surrounding area and redeveloped Brownfield site. 9. Prevent housing abandonment Increasing the desirability to live in the city may result from urban infill. Commensurate benefits include avoiding expenses of new construction, preventing crime that often occurs in and around abandoned buildings, and improving the aesthetics in the area. 9 10. Increased utilization of existing infrastructure Reduced pressure to provide infrastructure to outlying areas as urban sprawl is reduced; higher utilization of public utilities and transportation in the city. Apart from this, the redevelopment of brown field helps in evaluating the expected value of the remediate site minus cleanup costs, and assesses associated uncertainties to determine the potential for net public benefits. These discussions demonstrate that Brownfield development project never go in vain instead it creates a positive impact on the community. But there are a number of controversies spilled out amidst of these benefits. These controversies mainly crop up on its carelessness, Future risks, uncertainty in costs etc. (J. Urban Plng. and Devel, 2004)(15) Criticisms/Controversies The major controversy tip out of the brown redevelopment is its expense i.e the expense regarding clearing contaminated areas. Businesses and developers are often unenthusiastic about developing on Brownfield sites because of this expense and the limitations on building growth. Secondly, obtaining the necessary permissions can be delayed by negotiations over clean-up operations and other concerns hinders the planning process which is considered as major stumbling block to increasing Brownfield development. It may happen that Brownfield areas may not be suitable for gardens, although they are usually adequate for city apartment developments. Developers are sometimes accused of being more inclined to construct more profitable, larger 'executive' housing in attractive rural settings, rather than redeveloping decaying areas with limited space. Sometimes the Planning guidance may turn to be contradictory on flood risks, with Planning Policy Guidance (PPG). ------------------------------------------------------------------------------------------------------------ 15. J. Urban Plng. and Devel., Clean It and They Will Come' Defining Successful Brownfield Development Volume 130, Issue 2, pp. 101-108 (June 2004) 10 The most often cited controversy regarding brownfield redevelopment is uncertainty of liability, remediation cost, remediation process, and level of cleanup required. Inconsistency in current federal and state laws and their related enforcement contributes to the uncertainty. Due to this, the lending institutions may be reluctant to finance Brownfield redevelopment, which further decreases the opportunity to redevelop these sites. In addition, potential buyers prefer property be cleaned up prior to purchase. Uncertainty may also warp real estate markets. If owners fear detection of contamination, they may withhold their properties from the market. This shrinks supply, and causes buyers to seek uncontaminated properties. Brownfield's, therefore, become less desirable than Greenfield sites for future development. (Charles Bartsch, and Elizabeth Collaton, 1995) (16) It is said that industrial redevelopment of sites may have a negative impact on the community, if redevelopment occurs carelessly without pollution prevention and aesthetic considerations. Non-permanent, low-cost remedies, e.g., institutional controls may harbor future risks, particularly if land uses change. Cleanup and development may cause temporary disruption, risk and annoyance to nearby residents. The state and federal government has adopted a number of efforts to get rid of these controversies. For e.g.; in January 1995, EPA announced its original Brownfield's Action Agenda in response to the widespread economic development obstacles posed by urban Brownfield's. The (1995-1996) Brownfield Action Agenda encouraged a cooperative approach by EPA, lenders, and prospective purchasers to ease fears of financial liability and regulatory burdens. EPA has coordinated with the Office of the Comptroller of the Currency to create incentives within the CRA regulations for economic revitalization and development. Additionally Section 128(a) of the ------------------------------------------------------------------------------------------------------------ 16. Bartsch, Charles and Collaton, Elizabeth. Coming Clean for Economic Development: A Resource Book on Environmental Clean-Up and Economic Development. Northeast-Midwest Institute, Washington, D.C., 1995. 11 Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), as amended, authorize a noncompetitive $50 million grant program to establish and enhance state and tribal response programs. There are other legislations also are in force for the betterment of redevelopment in all aspects. (17) Conclusion The merits of Brownfield redevelopments can be enrooted in the community in devoid of controversies and criticisms, adopting certain strategies. Reducing clean up costs to conduct a detailed environmental site, reducing costs of environmental remediation through the use of innovative site remediation technologies such as in-situ bio-remediation -injection of micro-organisms into the soil and groundwater to neutralize contaminants, photo remediation - use of plant materials to neutralize contamination, chemical oxidation and air sparing etc are one of the remedies to trounce these controversies. Developers should also weigh the costs of treating contaminants versus the costs of leaving them in place through a site-specific risk assessment (SSRA) and utilizing deed restrictions where required. Owners and developers can reduce their potential liability through the purchase of environmental insurance products. Environmental insurance can be purchased to provide coverage for clean up cost overruns, clean up of unknown pre-existing contamination on the site and third party civil claims for costs and damages resulting from off-site contamination. Anyhow environmental professionals are now customarily offering cost-capped cleanups and some environmental companies will also consider a reduction of clean up costs in exchange for an equity share in the project. (18)(Niagra Falls Brownfield Redevelopment, 2004) *************************** ------------------------------------------------------------------------------------------------------------ 17. Funding Guidance for State and Tribal Response Programs for Fiscal Year 2008 18. Niagara Falls Brownfield Redevelopment City of Niagara Falls Planning and Development Department, Community information Package, 2004 Bibliography 1. Allardice, David R. "Brownfield Redevelopment and Urban Economies," Chicago Fed Letter. The Federal Reserve Bank of Chicago, Chicago, Illinois, 1995 2. U.S. Environmental Protection Agency, an Integrated Approach for Brownfield, Smart Growth Network, Urban and Economic Development Division Office of Policy, Planning and Evaluation, Sep.2006 3. Bartsch, Charles and Collaton, Elizabeth, Coming Clean for Economic Development: A Resource Book on Environmental Clean-Up and Economic Development. Northeast-Midwest Institute, Washington, D.C., 1995. 4. Bezer S.L. and Phillips, B.S. "Contaminated Property Valuation Issues: An Overview," Industrial Development, Vol. 159, No. 3, pp. 1-2, June 1990. 5, National round Table on Environment and Economy, NRTEE, Brownfield Redevelopment Canada, 2007 6. Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) 7. National Land Use Database, 2003 8. Niagara Falls Brownfield Redevelopment, City of Niagara Falls Planning and Development Department, Community information Package, 2004 9. Resource Conservation and Recovery Act (RCRA), 1986 10. Trenton Department of Housing and Development Trenton, New Jersey Brownfield Demonstration Pilot Program, February 28, 1995. 11. The United States Department of Agriculture, NDAA, Brownfield and Their Redevelopment, The Ohio State University, and County Commissions Cooperating,1996 12. Urban Plng. J and Devel., Clean It and They Will Come' Defining Successful Brownfield Development Volume 130, Issue 2, pp. 101-108 (June 2004) Read More