Congress passes new brownfields legislation.

In a move that is likely to benefit real estate developers, the Congress passed new brownfield legislation on Dec. 20, loosening the environmental clean-up requirements and absolving land owners of responsibility for land damages they haven't caused.

The bill, entitled Brownfields Revitalization and Economic Restoration Act of 2001, transfers the environmental control responsibility from the federal government to the state and officially terminates the practice by which property owners could be held accountable for contamination caused by a previous owner or a neighboring brown field site. Most experts agree that the bill goes a long way toward making redevelopment more attractive, but say that issues of most importance to the developers in New York have to be resolved the state level.

"On the federal level it's helpful because it provides a release from responsibility for the purchaser of the property if that property was contaminated prior to the purchase," says Larry Schnapf, a pro bono council for the Brownfields Coalition. "Before this you could not be an innocent purchaser. And it also increases funding and allows the Environmental Protection Agency to provide the money directly to the developer. But it still doesn't replace a state-initiated program.

Ronald B. Bruder, chairman of the New York-based Brookhill Group and an active brownfield redeveloper, holds the same view. "I haven't finished studying the bill yet, but it definitely goes a long way toward what we wanted," he notes. "Of course, this should have happened a long time ago."

Among the things that the Brownfields Coalition, and real estate developers like Bruder had been fighting for is greater flexibility for clean-up requirements. They feel that the standards imposed by the EPA are often not practical and apply the health guidelines relevent in the building of a residential community to the development of an office complex or a mall. The new bill takes into account such views and offers property owners protection from the federal Superfund regulations as long as they comply with a voluntary state clean-up program.

So the members of the Real Estate Roundtable's Environmental Policy Advisory Committee, one of the groups that had been promoting the bill in Congress, feel that at least in that respect they achieved a breakthrough.

"This bill places the primary responsibility for supervising brownfield cleanups with state programs and limits the circumstances under which the EPA can second-guess the state's handling of the issue," says Roger Platt, senior vice president of the committee. "So we are extremely pleased that Congress has created important incentives for private investment in blighted communities."

According to Schanpf, however, there lies the rub.

"The reality is that most brownfield programs are still controlled at the state level," he says. "So the new Act is helpful because it minimized the possibility of legal action, but I won't say that everyone will suddenly be rushing to develop brownfields as a result of it."