Barriers to Brownfield Redevelopment
RCED-96-125: Published: Jun 17, 1996. Publicly Released: Jun 28, 1996.
Pursuant to a congressional request, GAO reviewed proposed legislation to redevelop abandoned, urban industrial sites, focusing on: (1) the number of potential sites nationwide; (2) impediments to redeveloping sites posed by the Superfund program; and (3) whether proposed loans to local governments are sufficient for conducting site assessments.
GAO found that: (1) researchers estimate that about 150,000 acres of abandoned or underused industrial land exists nationwide; (2) lenders, property buyers, and property owners are reluctant to redevelop these sites because federal and state environmental laws may require expensive cleanups of latent industrial wastes before property improvements can be made; (3) federal law limits the liability of a party that holds ownership in a property but does not manage the property; (4) proposed legislation would limit the amount lenders would have to pay in the event they are liable, limit the liability of property buyers who assess a site for contamination before buying it, and provide assistance for state programs that encourage voluntary cleanup of industrial waste sites; (5) even if the liability of lenders and property buyers is limited, abandoned industrial sites might continue to be viewed as risky investments due to the possibility of contamination; and (6) proposed legislation would provide interest-free loans to localities to conduct site assessments to determine the extent of contamination.