Brownfields Redevelopment Financing for Small Cities, Rural Communities And Tribes October 27-29, 2003 Sharon Kophs Washington State Department of Community, Trade & Economic Development

Agenda   Rural issues and opportunities   Developing a game plan for redevelopment   Myriad of funding sources

Washington’s Brownfields Team RLF Cooperative AgreementStatewide Revolving Loans $1.2M $1.5M King Co/Seattle City of Tacoma CTED - Rural City of Spokane EPA CTED Lead Agency Fund Manager Ecology Site Manager EPA CTED Lead Agency Fund Manager Ecology Site Manager $5.1M

Rural Issues   Remote location   Empty historic buildings   Infrastructure costs are skyrocketing   Local, state & federal funding disappearing

Rural Issues   Industry in flux   Jobs disappearing   Population shrinking   Retail struggling   Youth drain   Crime rising   Digital divide

Rural Opportunities   Low cost of real estate   Proximity to resources   Social capital   Ingenuity   Room to grow   History   Unique character

The Key to Brownfields Redevelopment Is…..

Managing the Risks   Thorough site assessments   Defined cleanup goals   Known future site use   Well thought out cleanup plan   Secured (and multiple) financial resources   Team approach   Public acceptance

The Circle of Players Banker Developer Municipality Regulator Nonprofits Insurer

Managing the Risks   Economic viability ü ü Is the project economically sound? How much will it cost? What’s the return on investment? Where’s the money coming from? How long will it take?   Financial risks ü ü How can the risk of unexpected loss be managed? Discovery of new contaminants Failure of controls Firm regulatory decision

Managing the Risks - Economics $ Value of Property Present value Future Value Reuse design/Engineered controls Perceived Present Value Actual cost of cleanup Estimated cost of cleanup $ Cost of Cleanup Stop-loss Insurance Liability Insurance PROFITMARGINPROFITMARGIN

Managing the Risks - Financial ….. ….. Through a public development authority Similar to a Port District Created by a municipality Has its own board of directors focused on a single purpose

Managing the Risks …..it has no taxing authority! …..it has no taxing authority! Does not have to be formed through the voting process Can be created by a municipality or a county to undertake public projects in partnership with private Formed when municipality or county adopts and ordinance and charter, with specific criteria attached

Managing Risk   PDA’s can ….. ü ü Apply for public funds ü ü Own property ü ü Enter into public/private partnerships ü ü Issue bonds and invest ü ü Not create a liability for the entity that formed it.

Show me the money…

Community Financing Tools   Federal tax credits   Tax abatements   Low interest loans   Enterprise zones   New markets tax credits   Assessment & remediation grants   Community reinvestment tax incentives   Sales tax investment

Federal Funding Sources Tax incentives Assessment Grants Cleanup grants and loans Economic Technical Assistance Infrastructure support Transportation grants Rural Development grants

Brownfields Grants Available   U.S. Environmental Protection Agency Assessment – grants on community-wide or site-by-site basis of up to $200,000. Cleanup – grants of up to $200,000 per site; May apply for up to 5 sites. Cleanup revolving loan fund – grants of up to $1,000,000 per eligible entity to capitalize a revolving loan fund. Job training – grants of up to $200,000 per eligible entity.

State Financing Sources   State Cleanup Grants for public entities   WA Brownfields Redevelopment Program   Community Development Block Grant   Infrastructure Assistance Coordinating Council   Interagency Committee for Outdoor Recreation Department of Fish & Wildlife Department of Natural Resources State Parks & Recreation Commission

State Financing Sources   Transportation Improvement Board   Community Economic Revitalization Board   Fish and wildlife recovery   Small cities grant funds   Centennial water Fund   Public Works Board   Housing Trust Fund

Other Funding Sources   Local Funding Tax increment financing.08 Sales Tax for small communities Enterprise zone designation Bonds   Foundations Environmental Resource recovery Parks and recreation   Non-Profits ü ü Public Housing

Keep Focus on Redevelopment  A real estate and business deal with an environmental component  Managed with sound business principles and solid economics

Find Partners  Local leadership/redevelopment advocate  Team approach with developer, environmental firm, insurer, regulator  Developers willing to accept cleanup responsibility  Allow flexibility in structure of transaction AND redevelopment planning