Ohio House Bills 168 and 110: Just Another Drop in the Bucket for Brownfield Redevelopment?

By Mia Petrucci

A brownfield is “a property, [where] the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant.”[1] Ohio recently introduced House Bills 168 and 110 to be signed by Governor DeWine in June of 2020 and July of 2021.[2] These House Bills (1) provide liability protection to purchasers of brownfield sites, (2) allocate $500 million of Ohio’s budget to brownfield funding—with $350 million allotted for investigation, cleanup, and revitalization of brownfield sites and $150 million for demolition of vacant/abandoned buildings—and (3) create a new Building Demolition and Site Revitalization Program, for the revitalization of properties surrounding brownfield sites.[3]  Ohio has over 300 federal brownfield sites, with the highest concentration (90 brownfield sites) located in Cuyahoga County.[4]  Other counties, Lucas, Summit, and Franklin, have 53, 29, and 27 sites, respectively. The program reserves $1 million in funding per county ($88 million statewide), and the rest of the funds are awarded on a first-come, first-served application basis.[5] Counties have one year to use the funds before they are made available to other projects statewide.[6] Grants are for up to 75% of a project’s total cost, requiring a 25% match.[7]

While the allocated funds for brownfield revitalization are certainly helpful, the cost associated with redevelopment is large. It can cost anywhere from $15,000 to $35,000 to remediate one acre of contaminated land.[8] On average, the Northeast-Midwest Institute (NEMW) estimates the cost of brownfield cleanup to be $602,000 based on cleanup data provided by the EPA.[9] Based on that data, 75% of total project costs would be $451,500 per project. Thus, it would cost approximately $40.7 million to clean up the 90 brownfield sites in Cuyahoga County, $24 million to clean up sites in Lucas County, $13 million to clean up Summit County, and $12.2 million to clean up Franklin County. Thus, almost one-fifth of the entire brownfield revitalization budget could be utilized to clean up just four counties.

But the cost is not the only factor that stops developers from wanting to take on brownfield projects. These projects also take a long time to complete. Investigations of the property can take 90-180 days; the full cleanup of the property can potentially take over three years to complete.[10]  In 2019, only nine brownfield cleanups were completed in Ohio.[11] At the peak of brownfield redevelopment in Ohio, 35 projects were completed in one year.[12] Moreover, the problems with brownfield sites do not always end after redevelopment. Studies suggest that long-term stigmatization of land can affect property values after remediation. [13]

House Bills 168 and 110 are certainly a step in the right direction for Ohio. Subsidizing the costs of redevelopment is a common incentivization scheme utilized by state and local governments.[14] However, whether the bills go far enough to make meaningful change in Ohio is yet to be seen. The funds allocated could cover 75% of the cost of cleaning up the over 300 sites in Ohio. But getting developers to front the other 25% of the funds may be harder than Ohio anticipates.

House Bills 168 and 110 should be just the beginning for Ohio’s goals of brownfield redevelopment.

Image from: Moss

[1] EPA, Overview of EPA’s Brownfields Program, https://www.epa.gov/brownfields/overview-epas-brownfields-program (last visited Oct. 2, 2021).

[2] H.B. 168, 134 Gen. Assemb., Reg. Sess., (Ohio 2021); H.B. 110, 134 Gen. Assemb., Reg. Sess., (Ohio 2021).

[3] H.B. 168; H.B. 110.

[4] Ohio Fed. Brownfield Site Locations (2021), https://environment.netronline.com/state/OH/acres/.

[5] H.B. 110.

[6] Id.

[7] Id.

[8] Greater Ohio Policy Center, Redeveloping Brownfields: Increasing Opportunities for Job Growth and Econ. Dev., https://www.greaterohio.org/redeveloping-brownfields (last visited Oct. 2, 2021).

[9] Kevin Haninger et. al., The Value of Brownfield Remediation (Nat’l Bureau of Econ. Rsch., Working Paper No. 20296, 2014) (citing Evans Paull, The Environmental and Economic Impacts of Brownfields Redevelopment, Northeast-Midwest Inst. (2008)).

[10] Joseph Koncelik, Rethinking Brownfield Redevelopment in Ohio, Ohio Env’t L. Blog (May 2, 2016), https://www.ohioenvironmentallawblog.com/2016/05/brownfields-transactions/rethinking-brownfield-redevelopment-in-ohio-part-3-of-4/.

[11] Joseph Koncelik, Brownfield Redevelopment and Ohio’s Legacy Cities, Ohio Env’t L. Blog (Jan. 26, 2020), https://www.ohioenvironmentallawblog.com/2020/01/brownfields-transactions/brownfield-redevelopment-and-ohios-legacy-cities/.

[12] Id.

[13] Jill j. McCluskey & Gordon C. Rausser, Stigmatized Asset Value: Is it Temporary or Long-Term 285 (Review of Economics and Statistics, vol. 85 2003) (describing that in the years directly following cleanup, properties within a two mile radius of the previously contaminated land sold at significantly lower prices than properties located farther away).

[14] EPA, A Guide to Fed. Tax Incentives for Brownfield Redevelopment 20 (2011 ed.) (describing State tax incentives and credits, targeted financial assistance, and direct brownfields financing).

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