Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Financing Brownfield Redevelopment Barbara Vojvodíková Daiva Velykienė Edmunds Teirumnieks „This project has been funded with support from the European Commission. This publication [communication] reflects the views only of the author, and the Commission cannot be held responsible for any use which may be made of the information contained therein.“

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Awareness Funds usually come from a variety of sources at various points in the regeneration process There are different types and ways to acquire money for brownfield regeneration To find out financing possibilities of brownfield redevelopment in Lithuania To find out financing possibilities of brownfield redevelopment in Latvia

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Goals of the teaching unit Show main sources of financing brownfields regeneration Brief introduction to risks connected with brownfields project realization

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Content Money in brownfields regeneration - in general Examples from the Czech Republic Examples from Lithuania Examples from Latvia

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Main sources of financing private investors public sources - state budget or funds - municipal or regional budgets or funds - EU funds – new tool JESSICA donations and grants from other funds and organizations

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ JESSICA Joint European Support for Sustainable Investment in City Areas It is a new tool for use of Structural Funds. It is a credit tool. The main idea lies in renting money to projects which lead to town development. Financial means from Structural Funds are invested by the leading organization into holding funds or directly into Urban development fund - This will take place in Lithuania via the funds established in the participating banks Financial means can be inserted into Urban development funds also by municipalities, European Investment Bank, Council of Europe Development Bank, commercial banks and other financial institutions.

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Combination of sources advantages: greater chance to get loans lower benefits are required better flexibility during realization disadvantage: more complex project preparation

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Methods of financing of brownfields regeneration in the Czech Republic They differ in sources of financing: - private recourses, - public budgets, - EU resources. They differ in the aim: - at regeneration of old industrial areas and their revitalization, - removal of old ecological burdens, - removal of mining consequences. or -environmental -economical -urban development

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ The owner or user of activity is responsible of impact to environment and human health made in the process of the activity. All the damage made to environment must be recovered according to the principle of ‘Polluter pay’. Therefore, the owners or polluters must remedy contaminated sites and developed derelict buildings using their funds. Private finances in Lithuania

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ State funding in Lithuania There are a lot of historical contamination and ownerless abandoned buildings in Lithuania, so county and municipal administrations are responsible for the liquidation of construction and environmental clean-up. Since 2006 the government annually provides about 2 million Lt for municipalities and counties to finance construction clean-up operations.

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Projects in Lithuania supported by EU funds(1) The measures of 1 priority 4 task of Cohesion action program 3 measure – ‘Protection of biodiversity and landscape’. Supporting areas: Liquidation of abandoned (ownerless) buildings and other objects harmful to the environment. Applicant: State Service of Protected Areas (330 million. Lt.). 5 measure – ‘Impact assessment of contaminated sites’. Supporting areas: –Inventory of contaminated sites (CS) –Risk assessment of CS, treatment setting of priorities in the light of those real negative effects on human health, groundwater and surface water, ‘Natura 2000’ and others protected areas. –The preliminary eco-geological investigations on the priority areas and eco- geological research in areas dangerous to environment and human health. Applicant: Lithuanian Geological Survey(5 million. Lt.)

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Projects in Lithuania supported by EU funds(2) The measures of 1 priority 4 task of Cohesion action program 6 measure – ‘Historically contaminated sites’. Supporting areas: Surface contamination assessment of research or study performance. The necessary documentation preparing of CS rehabilitation. Remedy of CS (significant improvement in the state) from petroleum products, pesticides, etc.. environmentally hazardous materials. Applicant: Municipal Administration (62,996 million. Lt).

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Projects in Lithuania supported by EU funds(3) The European Regional Development Fund under the general support documents (SPD) measure 1.3 ‘Environmental quality improvement and environmental damage prevention’. The main objective - to reduce water, air and soil pollution and its potential threat to Lithuanian regions, to ensure the public's right to a safe and clean environment, to avoid the farming and other activities harmful effects on the environment (or lower), while maintaining the sustainable use of natural resources and the formation of a responsible Public attitudes to the natural environment. These measures include the following operating groups: –Setting of historical pollution and its clearing, with the support of two activities: management of CS, including their remediation and necessary equipment purchase; environmental clean-up of harmful substances from rivers, streams, lakes and valleys. The implementation of projects in these regions will become more attractive for economic development. Total on the activities of the group was signed 35 grant agreements (for the support of Lt.).

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Financial aspects in Latvia sources of financing Main possible sources of financing: State funding EU Structural funds, e.g. European Regional Development Fund (ERDF) Bank loans Private finances

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Investments in brownfields The environmental investment projects in Latvia are aided by the World Bank, The European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), the Nordic Environment Finance Corporation, the Nordic Investment Bank (NIB). The coordination of diversion of loans from these financial institutions to prior environmental investment projects is responsibility of the Ministry of Environment.

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Supported actions 1.Elimination of pollution source; 2.Remediation of polluted area; 3.Utilization of pollutants extracted during remediation. Applicable costs: 1.Project development and project management up to 10% of applicable costs, 2.Construction works, 3.Deliveries of facilities and equipment.

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Remediations priority Remediations of 1st category polluted sites are to be considered as a priority. From the environmental protection point of view it is more important to remediate those historically polluted sites where pollution presents higher level of hazards: – the highest level of concentration of pollutants, –the biggest area, –pollution or its spread endangers valuable nature objects or residential areas.

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ The Latvian Environmental Protection Fund LEPF - is state funded program which announces project tenders in agreement with project guidelines for funding and organizes project assessment according to decisions of Fund’s board. Projects of the state budget subprogram “Environmental protection projects” are implemented by societies, foundations, local governments, businessmens and individuals.

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Remediations priority Remediations of 1st category polluted sites are to be considered as a priority. From the environmental protection point of view it is more important to remediate those historically polluted sites where pollution presents higher level of hazards: – the highest level of concentration of pollutants, –the biggest area, –pollution or its spread endangers valuable nature objects or residential areas.

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ The reasons of brownfields existence in Latvia are: A socio - economic factors - the lack of resources, which prevents to renew the historical housing development Indetermination of common Development strategy in municipalities Locations of polluted territories in private estate Limited resources for polluted site remidiation Incompleteness in state legislation

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Conclusion Financing brownfields have many different way – diversification of sources is necessary Projects on brownfields bring many unusual risks but these risks can be eliminated Financing sources of contaminated sites redevelopment possible in Lithuania and Latvia Main projects allocated money from EU structural funds and the national budget in Lithuania and Latvia

Brownfields in Baltic States - Lifelong Educational Project CZ/08/LLP-LdV/TOI/ Thank you for your attention „This project has been funded with support from the European Commission. This publication [communication] reflects the views only of the author, and the Commission cannot be held responsible for any use which may be made of the information contained therein.“