Funding for Brownfields Redevelopment Discussed at Task Force

By Judy Sheahan and Derrick Coley

Elizabeth Mayor Chris Bollwage, led a brownfields discussion that focused on financing, federal programs, and legislation at the joint meeting of Mayors and Bankers and Brownfields task forces. Despite adverse weather that prohibited many Mayors and the representatives from the banking districts to be present, reports were provided by Charles McLean of the Federal Housing Finance Board, Kris Sarri of the Department of Housing and Urban Development, and Karl Alvarez of the Environmental Protection Agency.

Mayor Bollwage, Chair of the Brownfields Task Force, discussed his city’s accomplishment in developing an old landfill into a $387 million dollar mall. The mall was able to attract 3 million people in the first ninety days of operation. The City of Elizabeth was able to secure a 3% franchise fee for the revenue the mall generates the first year with guaranteed revenues of $4.8 million the second year and $6.5 million guaranteed the third year. The franchise fee amounts are approximately 5% of the total budget for the City of Elizabeth. Also, New Jersey Governor Christine Whitman recently announced a $15 million brownfields grant program in her State of the State address.

The Federal Home Loan Bank, according to Charles McLean, has spent the last year conducting community needs assessments and community lending plans in their districts. The community lending plans are to be submitted to the Federal Housing Finance Board in February. The purpose for these assessments was to determine if the district banks were meeting the financial needs for their member banks and the communities they represent as well as determine if other tools are necessary to meet these needs. Due to the Conference of Mayors work with the Federal Home Loan Bank System regarding brownfields, many of the District Banks looked into this issue while doing their needs assessments and have recommended some innovative programs.

The Federal Home Loan Bank of Atlanta developed one such innovative program. The Economic Development and Growth Enhancement program or EDGE, is a below-market advance program that provides funds to subsidize advances for community economic development projects. The Federal Home Loan Bank of Atlanta hopes that these funds can provide initial support for a project that might not be supported by conventional loans or to provide gap financing.

Kris Sarri from the Department of Housing and Urban Development (HUD) discussed HUD’s current efforts for brownfields redevelopment including a new round of funding for the Brownfields Economic Development Initiative (BEDI) program worth $25 million. The federal register notice should appear within the next two weeks.

Karl Alvarez told the audience that EPA is planning on announcing fifty more Brownfields assessment grants with the applications due on February 16, 2000. In addition, $32 million will be available for Brownfield Revolving Loan Funds. The cities of Stamford and Las Vegas have been successful in distributing a loan through the revolving loan fund. The EPA has also allocated $2 million dollars for Job Training and Workforce for new pilots. The EPA was also able to obtain a one-year tax credit extension for Brownfields cleanup until 2001.

More information regarding the Federal Home Loan Banks’ Community Lending Plans will be provided to the Mayors once they become available.