EPA’s Brownfields Program Office of Brownfields Cleanup and Redevelopment (OBCR) September 2005

2 What are Brownfields? Once productive areas have been abandoned – some are contaminated Once productive areas have been abandoned – some are contaminated Lenders, investors, and developers fear environmental liability and are more attracted to “greenfields” Lenders, investors, and developers fear environmental liability and are more attracted to “greenfields” The result has been blighted properties – brownfields The result has been blighted properties – brownfields GAO estimated that there are more than 450,000 brownfields across the country – others estimate that there may be more than a million GAO estimated that there are more than 450,000 brownfields across the country – others estimate that there may be more than a million

3 EPA Brownfields Program History In the early 1990’s, the U.S. Conference of Mayors pointed to brownfields as one of the most critical problems facing cities In the early 1990’s, the U.S. Conference of Mayors pointed to brownfields as one of the most critical problems facing cities Brownfields pushed down property values and tax revenues Brownfields pushed down property values and tax revenues Properties were not getting cleaned up and were worsening community blight Properties were not getting cleaned up and were worsening community blight EPA “pilots” provided seed money for helping communities and supporting new ideas EPA “pilots” provided seed money for helping communities and supporting new ideas

4 Small Business Liability Relief and Brownfields Revitalization Act Success of Brownfields Initiative led to legislative proposals Success of Brownfields Initiative led to legislative proposals Brownfields legislation signed in January 2002 Brownfields legislation signed in January 2002 Expanded funding for brownfields assessment and cleanup competitive grants Expanded funding for brownfields assessment and cleanup competitive grants Clarified liability protections Clarified liability protections Increased support for State and tribal programs Increased support for State and tribal programs

5 Expanded Program The Brownfields Law authorized the brownfields program including assessment, cleanup, revolving loan fund and job training grants The Brownfields Law authorized the brownfields program including assessment, cleanup, revolving loan fund and job training grants Current funding provides about $75 million per year for grants awarded through an annual competition Current funding provides about $75 million per year for grants awarded through an annual competition Expanded eligible properties to include petroleum contamination, mine scarred lands and abandoned controlled substance sites (meth labs) Expanded eligible properties to include petroleum contamination, mine scarred lands and abandoned controlled substance sites (meth labs) Expanded eligible activities to include direct cleanup grants, health monitoring, environmental insurance Expanded eligible activities to include direct cleanup grants, health monitoring, environmental insurance

6 Brownfields Grants – Eligibility General purpose units of government General purpose units of government Quasi-government entities operating under supervision of local government Quasi-government entities operating under supervision of local government Regional Councils Regional Councils Redevelopment Agencies Redevelopment Agencies Tribes (other than Alaska) Tribes (other than Alaska) Alaska Native Regional Corporation, Alaska Native Village Corporation, and the Metlakatla Indian community Alaska Native Regional Corporation, Alaska Native Village Corporation, and the Metlakatla Indian community

7 Brownfields Grants – Eligibility Non-profit organizations are eligible for cleanup grants for properties owned by the non-profit. Non-profit organizations are eligible for cleanup grants for properties owned by the non-profit. Loans from RLF grants may be made to: Loans from RLF grants may be made to: –Eligible entities –Developers –Private site owners

8 Eligible Properties Brownfields are real property, the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant. Brownfields are real property, the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant. Brownfields also include: Brownfields also include: –Petroleum-contaminated properties –Properties w/controlled substances –Mine-scarred lands

9 Eligible Properties Three types of Properties are not eligible for brownfields grants: Three types of Properties are not eligible for brownfields grants: – Sites listed on the NPL – Facilities subject to CERCLA orders and consent decrees – Properties owned or under the control of the federal government

10 Eligible Properties For some types of properties, EPA must make a “property-specific” determination for eligibility: For some types of properties, EPA must make a “property-specific” determination for eligibility: –RCRA-permitted facilities –CERCLA removal sites –Some facilities with PCB contamination –Sites that received UST trust fund monies

11 Clarified Liability Provided liability protections for innocent landowners, bona fide prospective purchasers and contiguous property owners Provided liability protections for innocent landowners, bona fide prospective purchasers and contiguous property owners Liability protections require that property owners demonstrate due diligence (all appropriate inquiries) prior to acquisition and take reasonable steps after acquisition Liability protections require that property owners demonstrate due diligence (all appropriate inquiries) prior to acquisition and take reasonable steps after acquisition Required EPA to issue regulations for all appropriate inquiries Required EPA to issue regulations for all appropriate inquiries

12 Increased Support for State and Tribal Programs Authorized funding to establish and enhance State and Tribal Response Programs Authorized funding to establish and enhance State and Tribal Response Programs –All Alaskan tribes eligible if they have response program the includes four required elements. Current funding provides about $50 million per year for grants awarded annually on an allocation basis Current funding provides about $50 million per year for grants awarded annually on an allocation basis States and Tribes use program funds to establish response programs and enhance site activities States and Tribes use program funds to establish response programs and enhance site activities Created enforcement bar against federal Superfund action for sites enrolled in State response programs Created enforcement bar against federal Superfund action for sites enrolled in State response programs

13 Overall Accomplishments Leveraged more than $7.1 billion in cleanup and redevelopment and more than 31,000 jobs Leveraged more than $7.1 billion in cleanup and redevelopment and more than 31,000 jobs Supported assessments at more than 7,000 properties Supported assessments at more than 7,000 properties Helped make more than 2,400 properties ready for reuse Helped make more than 2,400 properties ready for reuse Awarded more than 750 assessment, cleanup and revolving loan fund grants over the last 3 three years Awarded more than 750 assessment, cleanup and revolving loan fund grants over the last 3 three years Provided grants to all 50 States and 40 Tribes for their response programs Provided grants to all 50 States and 40 Tribes for their response programs Every dollar of Federal, State and local government spent on brownfields returns almost $2.50 in private investment (CUED, 1999) Every dollar of Federal, State and local government spent on brownfields returns almost $2.50 in private investment (CUED, 1999) Every acre of brownfields redeveloped saves 4.5 acres of greenspace (GWU, 2001) Every acre of brownfields redeveloped saves 4.5 acres of greenspace (GWU, 2001)

14 Small and Rural Communities 59% of the 295 grants awarded in FY05 went to communities with populations less than 100, % of the 295 grants awarded in FY05 went to communities with populations less than 100,000. Small and Rural Communities had a 43% applicant success rate (large had 46%) Small and Rural Communities had a 43% applicant success rate (large had 46%) Outreach includes workshops (many with NADO), resource guide, case studies. Outreach includes workshops (many with NADO), resource guide, case studies.

15 Recent and Upcoming Events More than 300 Assessment, Cleanup, Revolving Loan Fund and Job Training grants announced in May 2005 More than 300 Assessment, Cleanup, Revolving Loan Fund and Job Training grants announced in May 2005 The next round of applications will be opened in September 2005 The next round of applications will be opened in September 2005 All Appropriate Inquiries Rule - EPA anticipates publishing the final rule by the end of 2005 All Appropriate Inquiries Rule - EPA anticipates publishing the final rule by the end of 2005 Brownfields 2005 Conference – November 2-4 in Denver, CO Brownfields 2005 Conference – November 2-4 in Denver, CO

16 All Appropriate Inquiries The Small Business Liability Relief and Brownfields Revitalization Act requires that EPA develop federal standards and practices for “all appropriate inquiries.” The Small Business Liability Relief and Brownfields Revitalization Act requires that EPA develop federal standards and practices for “all appropriate inquiries.” Applicable to new liability protections. Applicable to new liability protections. Required of parties receiving Brownfields assessment grants. Required of parties receiving Brownfields assessment grants.

17 What is “All Appropriate Inquiries?” “All Appropriate Inquiries,” (AAI) or due diligence, is the process of evaluating a property for potential environmental contamination and assessing potential liability for any contamination present at the property. “All Appropriate Inquiries,” (AAI) or due diligence, is the process of evaluating a property for potential environmental contamination and assessing potential liability for any contamination present at the property.

18 Why Comply with AAI? Required if seeking protection from CERCLA liability Required if seeking protection from CERCLA liability To understand potential environmental risks associated with a property prior to purchase To understand potential environmental risks associated with a property prior to purchase Gain information that will help property owner comply with “continuing obligations” after purchase Gain information that will help property owner comply with “continuing obligations” after purchase

19 Small Business Liability Relief and Brownfields Revitalization Act Congress mandated that EPA promulgate regulations establishing federal standards for all appropriate inquiries Congress mandated that EPA promulgate regulations establishing federal standards for all appropriate inquiries Statute lists ten criteria EPA must include in regulations Statute lists ten criteria EPA must include in regulations Statute establishes interim standard Statute establishes interim standard

20 Applicability The All Appropriate Inquiries standards will apply to: The All Appropriate Inquiries standards will apply to: –Property owners asserting CERCLA liability protections –Persons receiving brownfields grants for site characterization and assessment under CERCLA 104(k)(2)(B) AAI may not be applicable to persons seeking liability relief under state law. AAI may not be applicable to persons seeking liability relief under state law.

21 Applicability (cont.) Brownfields cleaned up under state response programs may be eligible for federal enforcement bar per CERCLA 128(b) – AAI not required by CERCLA. Brownfields cleaned up under state response programs may be eligible for federal enforcement bar per CERCLA 128(b) – AAI not required by CERCLA. Until effective date of final rule, federal standard for AAI is ASTM E1527 (97 or 2000 version)—Interim standard set by Congress. Until effective date of final rule, federal standard for AAI is ASTM E1527 (97 or 2000 version)—Interim standard set by Congress.

22 CERCLA Liability Protections The Brownfields Amendments to CERCLA provide liability protections for landowners who qualify as: The Brownfields Amendments to CERCLA provide liability protections for landowners who qualify as: –contiguous property owners, –bona fide prospective purchasers, or –innocent landowners.

23 CERCLA Liability (cont.) To qualify for the liability protections, landowners must: To qualify for the liability protections, landowners must: –Meet certain threshold criteria prior to purchase –Satisfy certain continuing obligations after purchase.

24 Threshold Criteria No affiliation with liable party No affiliation with liable party Conduct all appropriate inquiries prior to date property is acquired Conduct all appropriate inquiries prior to date property is acquired

25 Continuing Obligations Comply with land use restrictions Comply with land use restrictions Do not impede effectiveness or integrity of institutional controls Do not impede effectiveness or integrity of institutional controls Take “reasonable steps” Take “reasonable steps” Provide cooperation, assistance and access Provide cooperation, assistance and access Comply with CERCLA information requests and subpoenas Comply with CERCLA information requests and subpoenas

26 Status of Federal Regulation Status of Federal Regulation Proposed rule published August 26, Proposed rule published August 26, Comment period ended November 30, Comment period ended November 30, Final rule developed by EPA and undergoing review by OMB. Final rule developed by EPA and undergoing review by OMB. Anticipate publication of final rule December Anticipate publication of final rule December 2005.

27 Highlights of Proposed Rule Structured around 10 statutory criteria Structured around 10 statutory criteria Objectives and performance factors Objectives and performance factors Definition of Environmental Professional Definition of Environmental Professional Report of findings Report of findings Rule addresses AAI; Not “continuing obligations.” Rule addresses AAI; Not “continuing obligations.”

28 Objectives of AAI Identify conditions indicative of releases or threatened releases of hazardous substances. Identify conditions indicative of releases or threatened releases of hazardous substances. Identify particular information about a property: Identify particular information about a property: –Uses and occupancies of property –Uses of hazardous substances –Waste management activities –Corrective actions and response activities –Institutional and engineering controls –Nearby and adjoining properties with environmental conditions

29 Next Steps EPA is developing final rule – recently submitted to OMB for review and approval EPA is developing final rule – recently submitted to OMB for review and approval Working with ASTM to update the E1527 Standard. EPA’s intention is to incorporate by reference an updated ASTM standard in regulation, if compliant with final rule. Working with ASTM to update the E1527 Standard. EPA’s intention is to incorporate by reference an updated ASTM standard in regulation, if compliant with final rule. Outreach and training. Outreach and training.

30 More Information EPA Website: EPA Website: Brownfields 2005 – Denver, Colorado November 2 – 4 Brownfields 2005 – Denver, Colorado November 2 – 4