Overview of Federal
Legislative Proposals to Promote
Brownfields Cleanup and Redevelopment¹

The 105th Congress has seen the introduction of numerous "brownfields" bills that address a broad array of issues affecting remediation and redevelopment of contaminated property. This overview briefly touches on various issues addressed in different proposals. It also summarizes several proposals that, while not included in any legislation, have been recommended by public and private sector brownfields analysts as options to consider.

Federal Recognition of State Voluntary Cleanup Programs

While 37 states currently have operating Voluntary Cleanup Programs designed to provide oversight, support and process certainty for those cleaning up non-NPL sites, sites cleaned up under the auspices of a state program still have the legal cloud of federal Superfund liability hanging over them unless EPA has assured site stakeholders that federal action is unlikely (through a No Further Action letter or Covenant-not-to-sue). To improve process finality, numerous brownfields bills include provisions that limit federal liability if a state has a Voluntary Cleanup Program that meets particular standards.

These Voluntary Cleanup Program criteria vary widely, but the issues addressed in various proposals include:

site eligibility. Most bills exclude sites from the potential waiver of federal liability if they are already being addressed by the federal Superfund program, and some go further to exclude sites that are being addressed by other federal program (e.g., RCRA); still other seek to define a category of "seriously contaminated" sites that are excluded, even though they haven't been touched by federal Superfund.
technical assistance and adequate resources available. Several bills require that states ensure that technical assistance is available to site stakeholders and that the states provide adequate resources for oversight, enforcement and program management.
public participation. Some proposed certification standards include public participation standards, including notice and comment requirements or broader language requiring states to ensure that communities have the opportunity to provide "meaningful" input into remedy decisions.
state approval of cleanups. To ensure that voluntary cleanup program provide process finality, several bills require states to provide a mechanism for cleanup approval.
certification process. Several bills outline a timetable for EPA to review state plans and set general standards for when and how EPA can withdraw certification of a state program.
reopeners. Some legislation defines the circumstances under which EPA can reassert federal liability and take cost recovery or removal actions.

Liability for Innocent Landowners and Prospective Purchasers

Most brownfields proposals contain provisions to clarify that prospective purchasers of contaminated land and innocent landowners are not liable to EPA for cleanup costs. In addition, some proposals limit the liability of landowners whose aquifers were contaminated by nearby contaminated sites.

Financial Support for Brownfield Site Remediation

Financial support for brownfields cleanup and redevelopment would come from tax incentives and capital attraction incentives. A provision allowing for the expensing of cleanup costs, included in a number of brownfields proposals was enacted into law as part of the Omnibus Tax Bill signed by the President on August 5. Other tax-related proposals include allowing for the use of Industrial Development Bonds (or similar types of tax exempt finance) for cleanup costs. In addition, the establishment of "Brownfields IRAs," through which companies could set aside tax exempt funds for planned cleanup efforts, is proposed.

Capital attraction incentives include grants for site inventories, site assessments and other pre-cleanup activities. In addition, grants for capitalization of state revolving loan funds are proposed. Such loans could be used for either cleanup, pre-cleanup activities or both, depending upon the proposal.

Brownfield Prevention Program

While not currently included in any legislative proposals, some observers have recommended enhancing our focus on "preventing" brownfields in the first place. One recommendation is the establishment of a revolving loan fund at the national level to make capital available to "potential brownfield" facilities, generally small, highly polluting industrial users that have limited or no access to capital (electro-platers, printers...). The fund would have to addresses the issues that exclude these firms from private capital sources such as the problem of lending to firms with virtually no valued assets to serve as collateral to secure new debt.

A separate proposal would be to amend the Small Business Investment Act of 1958 to allow a portion of resources devoted to Small Business Investment Corporations (SBIC) to serve as the capital base for a SBIC whose charter will be to provide capital to small firms with little access to capital for environmental improvements.

In addition, organizations such as EPA's Environmental Finance Advisory Board need to examine the potential for :

Improving capacity of community-based lenders to evaluate environmental risk
Improving availability of environmental insurance products to smaller firms
Credit enhancements provided by EPA/SBA

Innovative Technologies

To improve the cost effectiveness and speed of brownfield cleanups, efforts to disseminate information on innovative technologies should be stepped up. EPA collects data on innovative technologies used at NPL sites and makes that information available to the public. As cleanup and redevelopment activity at non-NPL sites increases, information regarding the efficacy, cost and time requirements of various cleanup technologies will be generated. This information needs to be collected and packaged in a manner that makes it useful to the "market" of brownfields stakeholders — lenders, developers, community organizations and cleanup contractors.

EPA could consider convening a working group of brownfields stakeholders to develop an information management system that would allow participants in redevelopment projects to take advantage of the cumulative experience of other projects with regard to the use of innovative cleanup technologies.

Coordination of Cleanup and Economic Development Programs

At least one legislative proposal for brownfields redevelopment includes a provision that requires state Voluntary Cleanup Programs to coordinate with state economic development programs to ensure that brownfields redevelopment efforts and economic development programs support instead of compete with each other.

¹See Brownfields '97 conference notebook which includes a detailed review of provisions in all brownfields bills currently pending in the 105th Congress.

8 September 1997
http://www.nemw.org/brownlegover.htm