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April 23, 2007
ABCs of Brownfield Redevelopment: Legislature Exploring Ways to Turn More Ghosts into Greenfields

Scattered throughout Connecticut’s landscape are the neglected and abandoned relics of Connecticut’s manufacturing past. While these structures are found in almost every town, the vast majority are clustered in the urban centers. Once thriving and alive with activity, these former manufacturing complexes are located along roadways, rail lines and rivers. Largely since the 1950s, urban flight away from our state’s manufacturing base has led to suburban development and these complexes have become ghosts. Lost are thousands of acres of open space and found are more abandoned structures. This trend is continuing and will continue if left unchecked.

In 2006, and again this session, the General Assembly is focusing on brownfield reform to restore the economic and community value of these properties. Governor Rell also heralded the issue and, in October, formed the Office of Responsible Growth through Executive Order No. 15. Among various collaborative planning initiatives to marry job creation and housing with mass transit, the new office is to scrutinize consistency with responsible growth objectives when a project seeks funding or bonding.

One way to achieve the responsible growth objectives is to encourage development of the idle manufacturing structures that are brownfields. These sites, however, pose many challenges. Brownfields redevelopment is not only about the location and the market. Questions of cost, timing, regulatory certainty and liability loom large. The challenge is to create and implement programs to stimulate private sector investment in brownfields. The key to responsible growth lies in turning around brownfields. But how?

There are some fundamental A,B,Cs of brownfield development which can apply to any site. “A” is initially for Agency. Brownfield redevelopment often has to navigate many agencies beyond local approvals. Virtually all sites require the involvement of the Department of Environmental Protection. If state funding is sought, then the Department of Economic and Community Development and the Connecticut Development Authority are involved. In 2006, the General Assembly, recognizing the myriad of programs and agencies, created a new office – the Office of Brownfield Remediation and Development (OBRD). Among other tasks, the OBRD is to centralize and coordinate the application of these programs to any given project developer. It is a one-stop-shop for advice and guidance. The project developer would have someone to call and navigate through the DECD, CDA and DEP’s program maze. The “A”gency, therefore, is the OBRD.

“B” is for budget. Projecting development costs for an undeveloped site is an easier task than for a brownfield site. Projecting costs from the ground surface up deals with what is known. Projecting costs from the ground surface down is far trickier. And, brownfield sites often have hidden infrastructure costs relating to the existing building (e.g., asbestos, PCBs, lead paint). Many developers (including municipalities), however, are not as well-versed in the costs associated with investigating and remediating a brownfield site. Many construction companies also bid on projects without including remediation and abatement costs. The construction company that includes the real costs will likely not be the winning bidder. However, the project will suffer with change orders or be stalled completely until the environmental conditions are addressed. Managing, staging and planning the project to incorporate the remedy into the development saves time and cost. Prior planning to identify the issues and the hidden costs (or categories of costs) brings a project in on budget.

“C” is for coordination. The right consultants, contractors, architects, engineers and attorneys are key to a successful project. Brownfield development often requires disciplines unfamiliar to a typical real estate deal and necessitates having the right people in place to coordinate A&B.

“D” is about the dirt and what is in, above and below the dirt. The type, concentration and location of the contamination can alter the development. Zoning restrictions may need to be altered to accommodate the development given its environmental condition. Environmental Land Use Restrictions may restrict certain types of development or land uses today, but their effect on subsequent purchasers, the value of the property and the impact on a town’s plan of development (or zoning) require heightened evaluation. Above all else, the developer needs to know when it is done – when the dirt has been cleaned up sufficiently and it can walk away; confident that the state’s regulations have been achieved, that the consultant’s work will achieve DEP scrutiny and that liability (risk) is capped.

“E” is evaluation, the earlier the better. On-site and off-site impacts should be investigated. If you know what is there, the costs can be projected and the site managed. “E” is also environmental because a brownfield development is about environmental clean-up. Early evaluation leads to an efficient environmental clean-up, which also leads to another “E”, economic development, which is the goal.

“F” is funding and financing. DECD has several potentially applicable programs to brownfield redevelopment – primarily, the Urban Site Remedial Action Program, the Special Contaminated Property Remediation and Insurance Fund (SCPRIF). The Connecticut Development Authority also provides financing through Tax Incremental Financing (TIF) and, working with a municipality, agreements could be put in place for property tax abatement or relief. But, more is needed. Under Public Act 06-184, the legislature created a Brownfields Task Force to study the state’s existing programs and to make recommendations for legislative change. The Task Force Report was issued in February 2007. Many bills have been introduced this legislative session to modify the state’s brownfields programs, including two bills to implement the recommendations of the Task Force. The Task Force recommended further funding and financing mechanisms to stimulate private sector investment. But the solution lies not in funding and finance reform alone; it requires programmatic and regulatory/liability changes and the Task Force made recommendations relating to the A,B,C’s of brownfield redevelopment. Certain programmatic changes are needed – especially to get to “G”.

“G” is for greenfields and preserving our state’s open spaces. The objective of Executive Order 15 will be achieved through Brownfields redevelopment. Brownfield projects also lead to green certified buildings. Successful Brownfield redevelopment is a win-win, if you pay attention to your A,B,& Cs.

Brownfields & Urban Sites