Outlook for Brownfields Redevelopment in 2009
Like all sectors of our economy, brownfields redevelopment has been adversely effected by the current economic crisis. Over the last 10 years since I returned to private practice after helping develop the Act 2 program, I've worked with a large number of brownfield redevelopers to turn old industrial sites in Pennsylvania into modern manufacturing facilities, commercial and retail space, shopping malls, hotels and casinos, office buildings, banks, drug stores, and housing developments. It has been an experience that is both personally and professionally rewarding, and nothing makes me happier than to drive past a site where I played some role in taking a vacant, blighted eyesore and putting it back into productive use, creating jobs and strengthening local communities. That is what brownfield redevelopment is all about. That is what motivates me and many other attorneys that are involved with brownfield redevelopment efforts, both in private practice and working at PADEP.
This last year has been a difficult one. Brownfield redevelopment continues but the pace has slowed considerably. The current economic crisis has killed a number of very high profile brownfield redevelopment projects. Last week, Pittsburgh based Sunnyside Ethanol LLC scrapped plans to build a multimillion dollar ethanol plant and waste coal electric facility on a former steel manufacturing site in Aliquippa. Earlier in December, North American Alcohols backed out of plans to build an ethanol plant on 114 acres owned by Rohm and Haas in Bristol Township, Bucks County. Housing developments continue to be built on brownfield sites, but the number, size and scope have dropped significantly. Even projects targeted as low cost townhomes or condominiums are slow sellers at this point. So where can we expect things to go in 2009?
As an optimist, I'd say the only place to go is up. I see several possible bright spots in 2009. First, I would expect that some part of the economic stimulus package being prepared in Washington will find its way to brownfield redevelopment projects. The President-elect has talked about building renewable energy projects and creating green jobs. Some of the best locations for that work will be on brownfield sites. Lower Bucks County, at the site of the former USX steel mill, is home to one of the most active green industrial parks, manufacturing wind mills and building solar panels. Recently, Superfund Report noted that the Obama transition team for EPA had been discussing policies designed to promote brownfield redevelopment on Superfund sites, and how such sites could be used in the drive for renewable energy. Second, as companies close manufacturing facilities, a new batch of brownfield properties will become available. To the extent that any of those closed facilities are in Pennsylvania, Act 2 will help facilitate future redevelopment through the use of clear cleanup standards, releases of liability and assessment and remediation funding. One question is whether the companies closing those facilities will be motivated to sell or simply mothball the sites for potential future use. A second question is whether there is sufficient financing and venture capital for brownfield redevelopers to reclaim those sites. We'll have to wait and see how that all shakes out.
I can tell you from personal experience that brownfield redevelopment has not stopped. It continues. I am working on a project in northwest Pennsylvania where a former manufacturing facility is being acquired by a local economic development agency and it has prospective tenants coming by almost weekly to look at the site. I am working on other projects where former corner gas stations are being redeveloped into bank branches and drug stores. Developers who are in this for the long haul continue to look for good sites and they are thinking creatively. A land-locked 10 to 20 acre former waste disposal area at the rear of a brownfield site now looks like a great place to put solar panels and generate about 2 to 3 megawatts of electricity. Opportunities exist for those who remain in the game.
To all of my readers, I want to thank you for your comments throughout the year. We had a wonderful dialog surrounding the implementation of the Uniform Environmental Covenants Act in Pennsylvania. I also want to thank all the public officials who were willing to talk with me and allow me to post stories including those comments and remarks. I look forward to continue those discussions with all of you in 2009.
Best wishes to all for a happy, healthy New Year.
