Despite new incentives to spur development of brownfield sites, state lawmakers again ignored a task force”™s repeated requests to establish a tax credit for such purposes.
Brownfields are abandoned sites that under normal circumstances do not attract developers due to the presence of polluted soil or water. By providing incentives to clean up sites for reuse, the public benefits both by the eradication of blighted properties, as well as capping “green field” construction that sprawls into open spaces.
Gov. M. Jodi Rell was in Norwalk July 16 to draw attention to the latest bill she signed into law that takes effect Oct. 1. She was accompanied by Joan McDonald, commissioner of the Department of Economic and Community Development, and Gary O”™Connor, an attorney with Hartford-based Pepe & Hazard who is co-chair of a state task force on brownfield strategies.
“We have been working on brownfields for what seems an eternity now,” Rell said, adding that such projects have received $22 million in aid the past few years in Connecticut. “We need the developers because they are bringing the private dollars to the table ”¦ A lot of developers have told me, ”˜I don”™t mind jumping in with both feet, as long as I know what I am getting into.”™”
“For all the attorneys in the audience,” McDonald added laughingly, “stand down.”
Among other measures, the law removes the liability of developers for prior pollution that has seeped into adjacent properties of the sites they purchase.
That is the basic problem with brownfields, of course ”“ cleaning up properties in which the legal entities for the original polluters no longer exist.
“This law will help remove some of the hurdles for developers, who see great potential in these idled properties,” Rell said.
In the case of the $300,000 cleanup adjacent to the South Norwalk train station, the original pollution occurred in the 19th century after an industrial pond was filled, leaving heavy metals buried below.
Asked by a reporter whether the bill would help officials track down polluters in such “cold” cases, Rell gave a noncommittal shrug signifying not much could be done in such scenarios.
But according to O”™Connors”™s state task force, many sites slapped with the brownfield tag are currently held or were once owned or leased by still-viable organizations who have intentionally vacated the site. The new law attempts to address that by modifying the state”™s private-party cost recovery statute. The law also extends the statute of limitations under Connecticut”™s property transfer act, which some judges had interpreted at less than three years, which often is how long it takes to determine the extent of pollution in a given brownfield property.
The question now becomes how well the new rules will stand up in a wilted economy. In its annual report published in February, O”™Connor”™s task force stated significant progress has not been made in redeveloping brownfield sites in Connecticut the past three years, in part due to the economic collapse of the past year.
Legislators pulled up well short of a request by the task force to free up $200 million to support brownfield development activities over the next five years and to establish a tax credit to reward investors who successfully redevelop properties for commercial or residential use.
Several states have such tax credits in place, ranging from a Missouri program that offers credits valued at up to 100 percent of the costs of redeveloping brownfields; to New York”™s program offering up to 12 percent of total development costs up to $35 million; or triple a site”™s cleanup costs, whichever is less.
The Norwalk cleanup was approved last October as part of an initial, $2.5 million outlay authorized in 2006 for brownfield cleanups, with Fairfield County receiving three other infusions for the Harbor Point development in Stamford; the Georgetown Land Development Co. project in Redding; and the cleanup of the former Axton Cross site in Shelton
