Brownfield

What Is a \”Brownfield\”?

The United States Environmental Protection Agency (U.S. EPA) defines a \”Brownfield\” as 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.

The State of Michigan defines a \”Brownfield\” site as a \”facility\” as defined by Part 201 of Natural Resources and Environmental Protection Act (NREPA) (contaminated at levels above generic residential use criteria). Properties that are adjacent and contiguous to \”Brownfields\” may also be considered \”Brownfields\”. The State of Michigan also identifies blighted and functionally obsolete sites as \”Brownfields\”:

Blighted

• Declared a public nuisance by local government
• Attractive nuisance to children
• Fire hazard or otherwise dangerous
• Utilities, heat, etc. disconnected so property is unfit for intended use
• Tax reverted property owned by a qualified unit of government
• Owned by a land bank fast track authority
• Contains substantial buried debris

Functionally Obsolete

• Unable to be used to adequately perform the function for which it was intended because of over capacity, changes in technology, deficiencies or super adequacies in design, or relationship to surrounding properties (certified by Level 3 or 4 Assessor)

Examples of potential Brownfields are foundries; automobile repair service centers; machine shops; dry cleaners; unlicensed dumps; and other sites where the use and storage of chemicals may have resulted in environmental impact at the sites.

How Do I Know If A Property Is A Brownfield?

An interested party should contact the Otsego City Manager\’s office or the City of Otsego\’s Brownfield Redevelopment Authority (BRA) to see if information suggesting the site is a Brownfield is available. Information may also be available through the Michigan Department of Environmental Quality (MDEQ): www.michigan.gov/deq.

Brownfields may be created by: 1) closed or under utilized industrial and commercial facilities (e.g., economics, population changes or city development and planning changes); 2) unintended consequences of federal and state environmental regulations (e.g., status liability for contamination or stringent cleanup requirements); and 3) relative costs of development – old developed sites vs. new suburban land.

What Is A Brownfield Redevelopment Authority and What Role Do They Play?

The Brownfield Redevelopment Financing Act (1996 PA 381, as amended by 2000 PA 145) allows a local unit of government to create a Brownfield Redevelopment Authority (BRA) to assist in redevelopment of Brownfields. BRAs develop and approve Brownfield plans, which identify eligible activities that will be conducted at the site, and determine if the community will support tax increment financing to capture state and local incremental property taxes.

Tax increment financing allows BRAs to capture property taxes from the increased taxable value observed after redevelopment. These captured taxes can then be used to reimburse the costs of eligible environmental and non-environmental activities.

What Is The Brownfield Redevelopment Process?

The Brownfield redevelopment process begins with a discussion with the City of Otsego City Manager and/or the City of Otsego BRA. From there, the interested party prepares a Brownfield Plan, which describes the project in detail and includes the information on the eligible activities to be performed at the site. The Brownfield Plan describes the taxes that are to be captured at each property, and indicates how the eligible activities will initially be funded.

Once a Brownfield Plan is complete, the City of Otsego BRA votes on whether to recommend it to the Otsego City Council. The City Council then has the final vote on whether or not to approve the plan. If the interested party intends to capture state school taxes, an Act 381 Work Plan must also be prepared. If the interested party is seeking reimbursement of eligible environmental activities (e.g., contaminated soil removal, hazardous materials abatement), the Act 381 Work Plan must be submitted to and approved by the MDEQ. If the interested party is seeking reimbursement of eligible non-environmental activities (e.g., building demolition, infrastructure improvements) the Act 381 Work Plan must be submitted and approved by the Michigan Economic Development Corporation (MEDC)/Michigan Economic Growth Authority (MEGA). The City of Otsego BRA will work with the developer through every step of the process to help ensure the project is a success.

U.S. EPA Assessment Grant

The United States Environmental Protection Agency (U.S. EPA) awarded the Cities of Allegan, Otsego and Plainwell a $200,000 Brownfield Assessment Grant for Hazardous Substances in 2008. The grant was awarded to the communities to help identify, characterize and prepare Brownfields for redevelopment. The cities used the grant to develop an inventory of Brownfields within each community, and then performed environmental assessments on priority sites to identify issues of concern and help prepare them for sale and/or redevelopment. The grant money was available to assist with site assessments for environmental due diligence and reuse planning at properties where a committed developer and redevelopment plan had been identified. The activities conducted under the U.S. EPA Brownfields Assessment Grant helped identify environmental concerns at many area Brownfields. This grant was an instrumental tool in attracting developers to Brownfield sites and ultimately transforming them into viable businesses. An example of a successful Brownfield redevelopment spurred by the U.S. EPA Brownfields Assessment Grant is summarized below.