1999 Winter Meeting

Financing Brownfields Sites Can Be Accomplished with the Right Tools say Mayors and Banking Officials

By Judy Sheahan

Mayors and banking officials from the Federal Home Loan Bank System and Federal Housing Finance Board discussed the financing options available to local governments as cities try to redevelop brownfield sites. Brownfield sites are properties that are not developed due to the fear of real or perceived environmental contamination. Banking officials have been meeting with cities for the past two months to discuss financing options and potential partnerships. The result of their initial work was released in a report at the joint session of the Brownfields and Mayors and Bankers Task Forces held at the Conference of Mayors Winter Meeting on Wednesday, January 27, 1999.

Opening the meeting, Fort Wayne Mayor Paul Helmke said, "We decided to hold a joint task force meeting between the Brownfields and Mayors and Bankers Task Forces when it became apparent that one of the biggest financing issues cities dealt with were brownfield properties."

Representative Jim Leach (IA), Chair of the House Banking and Financial Services Committee, EPA Administrator Carol Browner, and Cardell Cooper, Assistant Secretary for the Department of Housing and Urban Development, all spoke before the Task Forces and emphasized that it would take a multitude of resources to provide the tools necessary to encourage brownfields redevelopment.

Cooper commended Fort Wayne Mayor Paul Helmke who, as President of the Conference of Mayors last year, put 'brownfields on the map.' "I would encourage all of you to recognize that there are federal partners for this process with cities continuing to link federal dollars with private and public funds," Cooper said.

Rep. Leach said that properties now known as brownfields should be viewed as opportunities. "At one time these sites were prime locations and if remediated, they can once again bring positive economic benefits," Leach stated, adding that, "Leadership on the solution will come from the local level with the federal government playing a part."

Administrator Browner outlined the Administration's efforts including assessment pilot grants in over 227 communities and the future use of $35 million for local revolving loan funds to assist in the clean up of these sites. Browner also unveiled a new initiative called the 'Better America Bonds' which will give tax credits to states and local communities to issue $9.5 billion in bond authority to preserve green spaces, protect water quality and to clean up brownfields.

Some of the participants of the Task Forces include Fort Wayne Mayor Paul Helmke, Macon Mayor Jim Marshall, Bruce Morrison, Chair of the Federal Housing Finance Board, Al DelliBovi, President of the Federal Home Loan Bank of New York, Cedar Rapids Mayor Lee Clancey, Elizabeth Mayor Chris Bollwage, Dayton Mayor Mike Turner, Jackson Mayor Harvey Johnson, Buffalo Mayor Anthony Masiello, and Rockford Mayor Charles Box.

Community Investment Officers (CIOs) from Federal Home Loan Bank Districts throughout the United States submitted to the Task Forces a community update on their meetings with local governments to discuss financing options. Tools such as liability relief for cities, lenders, and innocent developers who are not responsible for the contamination; expansion of the scope for letters of credit; and expansion of the types of collateral the banks can utilize where some of the recommendations made by the CIOs to encourage banks to lend money on brownfield properties.

Mayor Marshall concluded the meeting by asking the banks and Administrator Browner for an examination of the types of federal, state, and lender policies that promote urban sprawl and hinder infill development. The Task Forces will be examining all of these issues and will be meeting again in June in New Orleans at The U.S. Conference of Mayors Annual Meeting.