Breathing New Life into Brownfields – The BUILD Act of 2013

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On March 7, 2013, Senators Lautenberg, Inhofe, Crapo and Udall introduced the Brownfields Utilization, Investment, and Local Development Act of 2013, which would amend the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.A. §9601 et seq. (“CERCLA”). The bill, known as the BUILD Act, reauthorizes the EPA’s Brownfields Program through an extension of current authorization levels through Fiscal Year 2016. However, the BUILD Act is much more than a simple reauthorization bill. On a symbolic level, the bill represents a refreshing reminder that elected officials on both sides of the aisle can still come together when change is needed. In substance, it contains important new eligibility and increased funding provisions that have the potential to both revive Brownfields projects that were tabled due to the economy and encourage new redevelopment projects.

Expanded eligibility is a cornerstone of the BUILD Act. At the present time, non-profit organizations are only eligible for site remediation grants. The Act broadens the definition of an “eligible entity” under CERCLA to include non-profit organizations, certain limited liability corporations, limited partnerships and “qualified community development entities” among those that can obtain site assessment grants.

In addition, under the BUILD Act, local governments benefit from expanded opportunities to obtain site assessment grants to investigate properties that were acquired prior to the enactment of the Small Business Liability Relief and Brownfields Revitalization Act in 2002. The site assessment grants are available to local governments even if they do not qualify for the “bona fide prospective purchaser exemption” under CERCLA (i.e. they did not undertake a level of due diligence amounting to “all appropriate inquiry” before buying the site).

States also benefit under the BUILD Act through targeted funding. The EPA is authorized under the BUILD Act to award up to $2,000,000 to provide grants to states. The caveat is that states must have spent at least 50% of the previous year’s funding on site assessment and remediation to qualify.

Increases in the amounts and allowable uses for funding are also key elements of the proposed legislation. Under the current law, site remediation grants cannot exceed $200,000 per site. The BUILD Act would increase that cap to $500,000 per site and give the EPA further authority to waive the limit and award up to $650,000.

Grant recipients would also have greater flexibility under the BUILD Act in terms of the costs that can be reimbursed though the grant program. CERCLA currently prohibits grant recipients from using grant proceeds to pay for administrative costs. If enacted, the BUILD Act would remove this prohibition and permit grant recipients to use up to 8% of any grant for administrative costs.

In the same vein, the BUILD Act would create multipurpose Brownfields grants of up to $950,000 that could be used to fund inventory, characterization, assessment, planning or remediation work at one or more sites in an area, provided that the grant money is used within a three-year period. At the present time, the grants are segmented such that multiple grants may be needed to complete an entire project. Allowing applicants to apply for one grant to cover multiple phases of a project can be expected to save grant recipients money by reducing the administrative application costs and the delays and uncertainty associated with piecemeal grants.      

Lastly, the BUILD Act incents Brownfields redevelopment at particular types of sites through focused funding. It directs EPA to give priority in awarding technical assistance grants to “small communities, Indian tribes, rural areas, or low-income areas with a population of not more than 15,000” individuals. The EPA is also required under the BUILD Act to give consideration to “waterfront brownfield sites” when awarding funds. A “waterfront brownfield site” is one that is located adjacent to a body of water or a federally designated floodplain. Special grants up to $500,000 are available for clean energy projects, which include renewable energy (wind, solar and geothermal) projects at Brownfields sites.

Whether viewed as part of the national environmental agenda or as an economic tool, the potential value of the BUILD Act in the continued success of the Brownfields program cannot be underestimated. According to EPA figures, as of this month, Brownfields grants have resulted in more than 20,000 properties being assessed and 845 cleanups being completed. As a result, over 38,000 acres of land have been made ready for reuse. Through the Brownfields Program, more than 86,000 jobs have been leveraged. The BUILD Act offers the hope that these benefits will not only continue, but will also reach those communities where help is needed the most.

The information contained herein is for general informational purposes only and is not intended to constitute legal advice or legal opinion as to any particular matter. For further information please contact Kristen W. Sherman at (401) 274-7200 or ksherman@apslaw.com

 

Topics:  Brownfield Properties, BUILD Act, CERCLA, EPA, Proposed Legislation, Redevelopment

Published In: Construction Updates, Environmental Updates, Finance & Banking Updates, Nonprofits Updates, Zoning, Planning & Land Use Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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