March 24, 1997
One of the most daunting challenges faced by most older, industrialized urban centers is the redevelopment of vacant brownfield sites Ñ properties with low-level contamination that do not fall under the Superfund clean-up guidelines. The U.S. Government Accounting Office estimates that as many as 600,000 brownfield properties are idle nationwide. Most of these properties are located in urban centers, near major transportation arteries and residential communities. Most have languished for years as potential purchasers, developers and financiers have balked at potential liability and clean-up costs associated with redevelopment. This reluctance has triggered a spiral leading to declining property values, unemployment and lost opportunities.
In Elizabeth (NJ), Mayor Chris Bollwage and his administration have built new partnerships at the local, state and federal levels to overcome these obstacles and successfully redevelop several very large brownfield sites.
"Due to the lack of developable property in urban centers, we must work with what we have to build new ratables and create jobs," Bollwage says. "That's why the recycling and reclamation of brownfield properties makes perfect sense for the economy and for the environment. It raises revenues without razing the environment and prevents further destruction of invaluable green space that is becoming a precious commodity in many cities."
One redeveloped former brownfield property is currently home to the IKEA Center at Exit 13A which includes the chain's best-performing North American store, and a Toys R Us/Kids World Superstore, the company's largest. Combined, both businesses provide hundreds of new jobs, more than $1 million in annual tax revenues and more than $2 million in Urban Enterprise Zone revenues.
Across the street from the IKEA Center, the City of Elizabeth is transforming 166 acres of a former garbage dump into a major metropolitan retail center which Bollwage says will be the envy of the East Coast. This is the $320 million MetroMall project which will create as many as 5,200 permanent jobs, 1,700 construction jobs and as much as $4.2 million in new tax revenues for the City. The pace of pre-leasing negotiations with tenants reflects the enthusiasm with which the mall is being received. A formal groundbreaking is scheduled for the Fall of this year.
The property will be developed into a manufacturers' and value outlet mall consisting of a main structure of 1.2 million square-feet plus 300,000 square-feet of separate retail buildings and a total of 6,000 parking spaces. The main mall will accommodate 12 major tenants, 250 shops and 18 restaurants. The western parcel consisting of 30 acres will be developed into a 300,000 square-foot retail center.
Converting this particular landfill into a commercial enterprise required almost 20 permits, including the permit for a clean bill of health under what was formerly known as ECRA (the Environmental Clean-up Responsibility Act). Through the efforts of a task force that included city, state and county officials, the developer and a private planning consultant, these permits were secured within the space of a few years, a remarkable achievement for a project of this size and complexity. Moving the project ahead also required the creation of new procedures and new legislation. Mayor Bollwage, city administrators and the developer successfully lobbied for legislation which will allow the City of Elizabeth to issue bonds to finance the development. The bonds will be paid off through franchise fees of up to three percent on businesses within a landfill reclamation improvement district. In this case, mall tenants will pay the fees. The Economic Development Authority will issues bonds to pay for infrastructure improvements to the 166-acre site. This has never been done and is serving as a model for similar developments across the nation.
Keeping the project moving took a lot of bi-partisan teamwork. With the City and a private planning consultant in the lead, all parties involved met once a month to trouble-shoot any snags in the permitting process, to identify new sources of funding, and to coordinate the state and local approvals process. In order to "fast-track" it, the City also worked to have the project classified as a high priority within the New Jersey Department of Environmental Protection, and a memorandum of agreement (MOA) with the Department of Environmental Protection enabled the developer to conduct the requisite remedial activities under DEP supervision.
While the property is easily accessible from the New Jersey Turnpike, Routes 1 and 9, and the Newark/Elizabeth airport/seaport, the City has worked to create even greater access: Construction of a four-lane road through the property has been completed, road widening is underway, and a flyover bridge from Exit 13A on the Turnpike will be built. The State Department of Transportation contributed significant financing Ñ $4.3 million Ñ in the form of grants for road improvements. This DOT commitment also led to the creation of a local transportation working group made up of task force consultants, City personnel and representatives from the Port Authority and its traffic consultants.
"With increased cooperation from the federal government and through the kind of bi-partisan teamwork demonstrated in Elizabeth, municipalities around the nation can turn its trash into cash," Bollwage said. "In the 1950s and 1960s, we were dumping garbage at some of these sites. In the 90s, we are going to be providing jobs and raising revenues at these sites." Information on the Elizabeth brownfields initiative is available from Sebastian D'Elia, (908) 820-4029.
The United States Conference of Mayors
J. Thomas Cochran, Executive Director
1620 Eye Street, NW, Washington, DC 20006
Telephone (202) 293-7330, FAX (202) 293-2352