The Clean Air/Brownfields Partnership Pilot held its second joint city meeting in Dallas on August 5-6, 1999. The Partnership Pilot kicked-off last August by the U.S. Environmental Protection Agency (EPA) in cooperation with the U.S. Department of Commerce Economic Development Administration, The U.S. Conference of Mayors and the three pilot cities: Baltimore, Chicago and Dallas. The purpose of the Pilot is to better understand the complicated linkage between urban redevelopment activities and air quality goals, an issue first brought to EPA's attention by Fort Wayne Mayor Paul Helmke, past President of the Conference of Mayors. Mayor Helmke at the Brownfields '97 Conference asked EPA to look at how various rules and regulations, especially the new Clean Air standards, would have an impact on a city's ability to attract business to their brownfield sites.

The meeting provided an opportunity for the participants to present their interim findings and relevant information for review and discussion. The participants have identified five areas involving air quality programs and regulations and economic redevelopment efforts that have linkages. The goal is to complete a report by the end of January 2000.

Discussion of the New Source Review Requirements

Karen Blanchard, EPA's project manager for the New Source Review Program (NSR), reported on the requirements for new and modified sources of air pollution under the NSR program. She also discussed the EPA's National NSR Reform Effort, and how the current Partnership Pilot has been included in the Reform effort.

The NSR program requires federal preconstruction permits for about 100 new and modified industrial sources each year. Areas in nonattainment are required, under the program, to employ greater levels of pollution control before they begin construction in order to protect public health.

Some critics of the Agency's NSR program have suggested that a lengthy and costly permitting process creates too much uncertainty regarding major financial investments in infrastructure development/redevelopment. Other concerns include the complexity of the NSR process and difficulty in obtaining rare and expensive offsets. Others claim that EPA's program is not restrictive enough to prevent air quality problems. One response by the EPA was to undertake a National New Source Review (NSR) Reform effort in the mid-90's, and proposed revisions in the program in 1996. The Reform Effort is on going at the time of this writing.

Blanchard indicated that EPA's Air Office staff is looking specifically at the linkage between the NSR program and urban redevelopment in the Partnership Pilot. She stated that any new or modified source that is drawn into the NSR program must comply with technology based emissions controls; and other operating, monitoring and reporting requirements. The three Pilot cities, Baltimore, Chicago and Dallas are all currently designated as severe nonattainment for ozone, and are therefore subject to what is called "LAER" -- lowest achievable emissions reductions. This means the best, and often most costly, air pollution control technology must be used regardless of cost. In addition, Blanchard stated that each new source adding emissions must be "offset" by decreasing existing emissions in the air region by more than what they add. The offset requirement is a way for nonattainment areas to continue to allow new business to locate in the region, but continue to reduce the overall emissions to bring the air quality in line with the national standards.

The group, according to Blanchard, is studying the extent to which the NSR program might inhibit redevelopment in urban centers, and, if so, what possible solutions can be identified. "The goal of our reform effort is to eliminate complexity, burden and permit delays without sacrificing environmental protection", stated Blanchard.

Progress Reported on EPA Efforts to Take Local Actions into Account

Geoffrey Anderson, project manager for EPA's Office of Policy, described exploring regulatory mechanisms that would allow cities to take credit for quantifiable air benefits resulting from local actions. EPA undertook a study to demonstrate quantitatively that infill development can lead to reductions in overall vehicle miles traveled (VMT) and associated air emissions. If such reductions can be proven, then there should be some consideration in the State Implementation Plans, (SIPs), toward crediting local/regional areas progress in achieving attainment, and/or allow them to accrue to an emissions credit bank for use as offsets.

Preliminary results from Anderson's study, (described in US Mayor, 7/12/99), indicate that avoided emissions accrue from reduced auto travel when development is located in the proximity to urban centers rather than greenfields located at the urban fringe. Three case studies suggested some 48-62% reduction in per capita VMT, and an associated 27-42% reduction in NOx emissions.

Mr. Anderson said the study is being extended to estimate similar emissions reduction potential in the three Pilot cities through application of a modeling approach. Some results on the application of the model in Dallas indicate that one infill development project would yield a 73% reduction in volatile organic chemicals (VOCs), and an 87% reduction in NOx emissions compared to a representative greenfield location. Anderson suggested that emissions benefits could add up if more infill sites are chosen for development over greenfield sites.

EPA has encountered some difficulties in this effort. Anderson stated that the Agency is seeking answers concerning how emission benefits are calculated, what scale of comparison should be employed, and will successful results be achievable in other urban centers? Each of these concerns affects the question of whether or not meaningful emission reductions can be realized and be reflected in the SIP.

Land Use Policy Options and the State Implementation Plan (SIP) Process

Patrice Thornton from EPA's Office of Policy reported on efforts by the Agency to determine how quantifiable emissions reduction can be reflected in a SIP. This effort involves a review of transportation-related emissions and land use policies that are designed to minimize or avoid them. The quantification tools designed to compare infill versus greenfield sites for development/redevelopment would be one way for local government to quantify reduced or avoided air emissions. If local government can steer development to the infill site (urban redevelopment), then the avoided emissions should be reflected in the SIP.

EPA has stated several times during the Pilot study that urban redevelopment can be an effective way to avoid sprawl development and some of the substantial increases in transportation related air emissions associated with it. One of the key elements to this review is an examination of how local land use policies can lead to what is referred to as "Smart Growth". If land use policies are to be an effective way to control the level of air emissions, then they must take into account, and be harmonized with regional transportation plans.

Thornton indicated that the Agency is still grappling with the quantification issues outlined in the previous section. She stated that they plan develop a final report soon that will include general steps that an area will need to perform to receive SIP or conformity credit.

Locating Clean Utilities on Urban Brownfields

Greg Dain from EPA's Office of Policy presented a progress report from the group reviewing the potential for redeveloping brownfields with modern electrical generation technology. Catherine Morris and Paige Shelby of the Center for Clean Air Policy (CCAP) head this effort.

Dain explained that if you locate clean energy generating plants on brownfield sites, then you could reduce the amount of, or dependency on, older more polluting energy producers. It is generally recognized that, of the fossil fuel alternatives, generating electricity from natural gas produces less air emissions in general. When you consider combined heat and power (CHP) facilities on these brownfield sites the air emissions savings are even greater.

Dain pointed out that CCAP suggests that achieving the clean utility/brownfield redevelopment goal is impeded by a number of factors. One factor identified by the CCAP is the requirement to go through the NSR program in nonattainment areas. CCAP has undertaken a program of interviewing business that have some experience with utility development in urban centers. They seek to find out what the location decision criteria is for these firms, and whether or not they view NSR as a barrier. Issues of the cost of technology (LAER) and offsets will be evaluated, along with other air regulations.

One of the particular difficulties identified is credits and offsets, and how they are employed in actual permit decisions. Part of the appeal to locating clean utilities on brownfield sites is that they would employ relatively clean energy generation. This electricity should displace electricity demand generated by the older, higher emitting plants. The theory is that the older and less efficient plant will go off-line, or reduce production. The associated emission reductions, CCAP argues, should be credited to the utility/brownfield development. Currently, there is no regulatory mechanism to assign such credit.

The Urban Economic Redevelopment Perspective

This group consists primarily of local government staff from Baltimore, Chicago and Dallas, with assistance and coordination from The U.S. Conference of Mayors. Each of the Pilot city representatives presented results of their research on the city's economic development history, future plans and air quality designations since the inception of the Clean Air Act.

The recurrent theme was -- how do we attract business and jobs without adding to the air quality problems we are currently facing? Baltimore and Dallas representatives, Melanie Wilson of Baltimore and Karen Alvarez of Dallas, indicated that their economic development plans was centered on clean industry and the type of incentives that could used to attract these types of businesses.

Alex Holt from Chicago reported on Mayor Daley's involvement with the Metropolitan Mayors Caucus, a 269-city effort to tackle air quality nonattainment issues from a regional perspective. She indicated that the rigors of the NSR program worked against the urban economic redevelopment plan.  Holt told the assembly, however, that local governments can take local actions which can add up to big reductions in air emissions, and help regions achieve attainment status. This is in line with Mayor Daley's assertion that we can simultaneously achieve clean air and economic goals, (See U.S. Mayor April 5, 1999). She described a number of efforts now underway in Chicago to locate a new and clean electric utility on a Chicago brownfield site. She also elaborated on some local actions, such as idling ordinances, reducing the effects of urban heat islands, promoting non-combustion related transportation, etc. which she is currently attempting to quantify. She discussed the need to develop an emissions reduction credit bank and trading program approach to take advantage of the air benefits from local actions. The bank and trading program would provide a buffer for scarce and costly offsets.

The current thinking on brownfield redevelopment is that air regulations pose a cost and uncertainty barrier. While it is the purpose of this Pilot to more carefully and accurately describe this potential barrier, it is recognized that air quality goals are not the only barrier. The cost involved to certify that a brownfield site is clean, and can be redeveloped is another barrier. The basic problem here is that the brownfield redevelopment approach makes much economic sense, and results in better air quality if done correctly. Yet, businesses are less likely to agree to pay the premium involved to clean up and get an air permit in a nonattainment area.

The group reported that they are lining up some brownfield redevelopment case studies to further explore the nature of the problem. The plan is to learn from the case studies what will and will not work to achieve brownfield redevelopment. The USCM plans to develop a list of "Best Practices" based on local and regional actions that local government can take independently, and in cooperation with regional organizations to help cities advance economic redevelopment goals.