Does your community have blighted properties, underutilized buildings, or vacant infill sites? Is the redevelopment of these properties complicated by the presence or possible presence of hazardous substances, pollutant, or contaminant? If you answered yes, then your community has brownfields. The U.S. EPA estimates that there are more than 450,000 brownfields in the U.S. Cleaning up and reinvesting in brownfield properties not only increases local tax bases, but also facilitates job growth, utilizes existing infrastructure, takes development pressures off of undeveloped, open land, and improves and protects the environment.
There are several funding resources for the development of brownfield properties. The U.S. EPA provides grants and technical assistance to communities, states, tribes, and others for the following brownfield efforts:
Brownfields Assessment: provide grant funding for brownfield inventories, planning, environmental assessments, and community outreach.
Brownfields Cleanup: provide grants up to $500,000 for an applicant to address cleanup activities on one or multiple brownfield sites owned by the applicant. Cleanup grants require a 20% cost share.
Revolving Loan Fund (RLF): provides up to $1,000,000 in funding to capitalize loans that are used to clean up brownfield sites. RLF grants require a 20% cost share.
Multipurpose Grants: provide up to $800,000 in funding to conduct a range of eligible assessment and cleanup activities at one or more brownfield sites in a targeted area. At the time of the application, the applicant must own a brownfield site, within the targeted area. There is a $40,000 cost share requirement.
Qualified Opportunity Zones offer another tool to facilitate brownfields development through capital gains tax credits for investors. Opportunity Zones (OZ) were created to attract private investment to targeted census tracts. These census tracts are of low-income and distressed communities designated by state governors and certified by the Department of Treasury. Investing in Qualified Opportunity Funds (QOFs) offers significant tax advantages to private entities who have profits earned from selling investments (known as capital gains) if those capital gains are invested in a QOF associated with OZ census tracts. IRS rules state that a fund designated as a QOF must invest at least 90% of its assets in a qualified OZ property or qualified OZ business. The final IRS regulation can be found in Volume 85 of the Federal Register on page 1866 (85 FR 1866), includes several provisions to support QOF investment in brownfield assessment, cleanup, and redevelopment.
Watch the video below to learn how one riverfront city is expanding their downtown community through brownfields revitalization:
Impact7G offers services to assist with brownfields revitalization and planning. For more information on tackling brownfield properties in your community please contact us at https://www.impact7g.com/contact/