They are all too common in most Midwestern cities and towns – sites that were once productive that now sit vacant or underused, often due to historic environmental contamination. These "brownfields" have long been a serious impediment to municipal growth, deterring investment and encouraging urban sprawl. But that is the past. Spurred on by numerous grant and low-cost loan opportunities, municipalities of all sizes have begun to aggressively market and redevelop brownfields, often through partnerships that successfully leverage private investment and create new jobs.
Nowhere are the municipal funding alternatives for brownfields redevelopment more promising than in Ohio. This is largely because, in November 2000, Ohio voters passed one of the nation's most aggressive environmental funding measures – the Clean Ohio Fund. This law created a $400 million bond pool to fund grant programs aimed at preserving natural areas and farmland, protecting streams, creating outdoor recreational opportunities, and revitalizing urban areas by returning contaminated properties to productive use. Almost $200 million in grant money was set aside specifically to enable four rounds of municipal-led brownfields redevelopment. The results from the first three rounds of funding are striking: municipalities statewide have refurbished more than 100 brownfields.
With the application deadline for the final, fourth round of funding now past, many thought that the Ohio brownfields renaissance was over. But, recognizing the value of this program, one of Governor Taft's final acts before leaving office was to sign a bill, approved by lawmakers in late December 2006, that enables the Clean Ohio Fund's redevelopment program to continue. That legislation – House Bill 699 – removed the legislative caps that would have spelled an end to the program after the current round of funding. Specifically, it amended language that had capped the total debt the Clean Ohio Fund could incur at $200 million to provide that the outstanding Clean Ohio Fund debt cannot exceed $200 million. Thus, as the fund's debt is paid off, additional rounds of grant appropriations can be made.
Of course, the Clean Ohio Fund is just one of many funding sources available to aid municipal redevelopment. In addition to traditional tax increment financing alternatives, several federal agencies including the U.S. Environmental Protection Agency, U.S. Department of Housing and Urban Development and U.S. Department of Transportation all offer grants and low-cost loans to support brownfields redevelopment. Similarly, other state-level programs – like the Job Ready Sites Program – exist. Importantly, environmental laws also increasingly are reflecting the importance of brownfield redevelopment, through recent changes meant to protect against redeveloper liability and enhance the ability of those incurring clean-up costs to recover from those responsible for the contamination. Squire Sanders' public finance and environmental lawyers have substantial experience in all facets of municipal property redevelopment, and have particular expertise in developing creative ways to fund and recover the costs of brownfield efforts.