|
| Who Can Borrow Money for Brownfields Cleanup?
Before you can redevelop a brownfield, you have to clean up the contamination. And money for cleanup is a challenge. Most lenders are unwilling to lend money for something like that, and you’re caught in a catch 22: You can’t sell or redevelop the property because you don’t have the money to clean it up. You can’t borrow the money to clean it up because it’s contaminated.
That’s where we come in. The primary source of funding available through the Brownfields Coalition is the Brownfields Loan Fund (BLF). However, sites and borrowers must be eligible for the funding and eligibility can be tricky to determine. Below are some general guidelines to help you figure out if you might qualify.
Brownfield site eligibility
Site eligibility is based on the situation, the urgency of the project, the threat of the contamination, and the time frame in which a cleanup can be done. The cleanup must also be approved through the Department of Ecology’s Voluntary Cleanup Program.
How you plan to reuse your property determines how the property will be cleaned up…which can, in turn, impact your eligibility for a loan. Contamination doesn’t always have to be removed. Depending on the circumstances and plans for the property, contaminated soil might just be contained and paved over, but not always. Obviously, property that will be redeveloped for a school or housing will require much more stringent clean up than a car dealership.
Some factors that determine loan eligibility include:
- A site reuse or redevelopment plan with near-term economic viability
- The project will result in job creation and retention
- The project will improve existing environmental conditions
When evaluating a loan application, we can also look at the social and economic benefits of the redevelopment, including an evaluation of the property’s marketability and land value, visibility, neighborhood conditions and physical infrastructure. But the financial and environmental factors will still be the most important.
A BLF loan may also be used for prevention, abatement, or removal of hazardous substances or contaminants that threaten public safety, drinking water or sensitive ecosystems.
An evaluation of your loan application will include a review of the risks of the cleanup and the proposed redevelopment. Your coalition partner can help you get a better idea of whether or not your site will qualify for a loan.
Specific types of brownfields
So far, we’ve discussed eligibility in general terms. But there are different types of brownfields and you need to know what you have before you can proceed. Which one best describes yours?
- Properties contaminated by hazardous materials, like those left behind by drycleaners, wrecking yards, industrial facilities, electroplating, fabricating, meth labs, etc.
- Petroleum sites such as closed or abandoned gas stations and storage facilities
Brownfield sites not eligible for funding
A BLF loan may not be used on:
- Superfund sites, whether listed or proposed
- Sites subject to a unilateral administrative order, court order, administrative order on consent or a judicial consent decree under CERCLA
- Sites subject to the jurisdiction, custody or control of a department, agency or instrumentality of the U.S. except land held in trust for an Indian tribe
Brownfield borrower eligibility
When we look at your situation to see if we can loan you money, we don’t just consider the site. You as the borrower must be eligible too. You absolutely, positively can not borrow money for cleanup if you were in any way responsible for the contamination in the first place.
And if my brownfield site is not eligible?
The new Brownfields law gave EPA the authority to fund work at brownfield sites and certain other sites, which are generally excluded from the definition of a brownfield site. As a result, if your site looks like it’s not eligible based on the criteria above, it may still qualify for funding. EPA can make a site-specific ruling based on whether the project will:
- Protect human health and the environment, and
- Either promote economic development or enable the creation of, preservation of, or addition to parks, greenways, undeveloped property, other recreational property or other property used for nonprofit purposes.
For more detailed information on site eligibility, see the loan guide.
|
|
|