Brownfield Redevelopment

Brownfield Redevelopment

Brownfields are sites where environmental contamination concerns – whether real or perceived – have hindered resale, redevelopment and reuse. Brownfields may include former gas stations, petroleum bulk plants, fertilizer warehouses, or vacant industrial plants and factories.  Issues related to potential liability for soil and groundwater contamination, regulatory requirements for the management of hazardous buildings materials, such as asbestos or lead-based paint during renovation or demolition, and the time and costs associated with these concerns results in properties that sit latent or vacant, negatively affecting community vitality and sustainability.

The Iowa DNR does not designate a property as a brownfield; rather, the term brownfield is a description of these types of sites that have the reputation of being dirty, dingy, or tarnished from a reuse and redevelopment interest perspective.  However, the DNR sees these sites as more than obstacles, as they can be an opportunity for redevelopment and reuse that adds character and value back to Iowa communities, both large and small.

Most brownfield sites do not present significant challenges for environmental contamination or hazardous building material issues, and the DNR can assist Iowans with answering questions about environmental liability concerns, how to approach brownfield redevelopment with proper due diligence, and even financial assistance for brownfield site assessment and cleanup for local governments and community-based non-profits that seek to acquire and redevelop properties of this description.

Is my site a Brownfield?

The Iowa DNR does not designate a property as a brownfield.  The term brownfield is only a descriptive term for sites where environmental concerns, whether real or perceived, are hindering redevelopment.   There may be sites where state or federal grants and technical assistance have been utilized to help answer or address these environmental questions, and these sites may be referred to as a brownfield within a database or regulatory reference for where assistance was provided.   So, don’t worry if you are, or aren’t, classified as a brownfield site, as the IDNR can help you with any related questions you have about your property.
 

DNR Brownfield Program Financial and Technical Assistance

The DNR’s Brownfield Redevelopment Program, funded by the federal Brownfield Revitalization Act, provides technical and financial resources to communities to help them find answers to environmental questions at brownfield sites. The program also assists with environmental cleanup planning and implementation to prepare sites for reuse or redevelopment.

Cities, counties, area development corporations, and nonprofit organizations that wish to acquire and redevelop brownfield sites are eligible for the program. Financial assistance cannot be provided to parties that have obtained sites without first conducting an environmental due diligence process, at petroleum sites where there is a liable and viable party, to private parties for their own environmental due diligence, to local governments or non-profits for the repair or renovation of their own facilities, nor directly to any entity that would have caused, or be responsible for, any potential contamination to be addressed.

• 100% Cost reimbursement for an "all appropriate inquires" report about the recorded development and environmental history of a site prior to purchase (known as a Phase I environmental site assessment)

• 100% cost reimbursement, up to $25,000 per site for:

  • Phase II pre-purchase environmental site assessments, involving sampling soil and groundwater for contaminants
  • certified asbestos inspections.
  • Lead-based paint (LBP) inspection, to determine if any LBP that would be removed needs to be disposed of as a hazardous waste.
• 75% cost-share for environmental cleanups, up to $25,000 per site for
  • Asbestos removal prior to demolition or renovation
  • Lead-based paint removal prior to renovation
  • Cleanup of soil or groundwater contaminants (requires enrollment in the Land Recycling Program, a certified cleanup program).

All financial assistance requires a contract with DNR before assessment or inspection activities may begin, and these assistance grants are subject to further eligibility restrictions, funding priorities, funding available, and additional state and federal regulatory compliance considerations.

The community should have a redevelopment and reuse plan for the site, and financial resources that would result in one of the following redevelopment outcomes once the environmental issues are addressed through DNR grant assistance:

• Direct economic redevelopment through resale and reuse of the site to create tax base and job creation
• Value-added use of direct benefit to the public (such as a new library, community center, historic preservation)
• Conversion to improved greenspace, recreational use, or natural habitat restoration.

Understanding Phase I and Phase II Site Assessments

While Iowa law does not require property owners or buyers to conduct environmental sampling of soils or groundwater prior to a real estate transaction, many potential buyers, lenders or investors seek an environmental assessment prior to purchase. Assessments allow all parties involved to anticipate environmental conditions that could impact the suitability of the site. Without an environmental assessment, property owners may have a difficult time finding buyers if the site has current or historical activities that involved storage, use or disposal of hazardous materials.

Phase I Environmental Site Assessment

The first step in conducting pre-purchase environmental due diligence is often a Phase I environmental site assessment (ESA). Conducting a Phase I ESA is a non- intrusive process that involves reviews of environmental records at local, state and federal agencies for the property and areas around it, reviews of local building records and historic aerial photos and maps, as well as a site walk-over with photography. The Phase I ESA provides a summary of historic and current site and area activities and observations that could have potential environmental impact, and the Phase I ESAs finding will recommend if it would be warranted to do sampling and analysis of soils and groundwater for any suspected contaminants (a Phase II ESA) to confirm if past site activities have created any environmental or human health impacts of concern.

Environmental engineering or consulting firms with experience in this area conduct Phase I ESAs. Completion of a Phase I ESA does not create liability issues for current owners unless obvious, hazardous conditions are observed. If a buyer seeks federal environmental liability exemptions or brownfield grant program resources, a timely Phase I ESA is required prior to purchasing the property, and the Phase I ESA must be conducted by using ASTM Standard E1527-21.

Phase II Environmental Site Assessment

If a Phase I ESA indicates possible environmental impacts, the buyer may request a Phase II ESA to confirm or deny contamination in suspect areas. This assessment involves collecting soil and groundwater samples, laboratory analysis, and comparing results to regulatory standards. While Iowa law does not require Phase II ESAs, if results indicate a potentially hazardous condition, such findings must be provided to the DNR for further review. Current owners may have an obligation under Iowa law to conduct further assessment to determine the extent of the contamination. Owners may also have to conduct cleanup or other remedial actions if it is determined they caused any hazardous conditions.

Key Items for Consideration

If you are considering buying or selling a property, you may want to evaluate the need for conducting environmental testing prior to the sale.    Buyers and sellers of property should discuss the Phase I and Phase II ESA process, and related responsibilities and regulatory considerations, before proceeding with assessments.

Brownfield Redevelopment Process Steps for Communities

Take the Right Approach for Site Acquisition and Eligibility!

If your local government or non-profit redevelopment group is interested in redeveloping a brownfield site, you’ll need to take a number of steps to ensure potential environmental contamination is handled properly and that you meet the requirements to receive financial and technical assistance.

Communities must ensure that they conduct property “all appropriate inquiries” into a property’s development and environmental history by conducting a timely Phase I environmental site assessment, BEFORE they voluntarily purchase a site, or acquire it through quit claim deeds or other voluntary acquisition, in order to be eligible for brownfield cleanup funding.   Communities that acquire a property by back tax foreclosure, Court Ordered transfer to the City through abandonment proceedings within Iowa Code Chapter 657A, or by eminent domain may be eligible for cleanup funding assistance without completing a Phase I ESA prior to purchase.

For an outline of the proper approach and timing for pre-acquisition assessment, and post-acquisition cleanup, this link provides an outline graphic to help you take the right approach to site acquisition for brownfield funding eligibility and assistance.