Public Sector Investment in Brownfield Cleanup Can Draw Private Sector Interest

Written by Amanda Maher

Until the mid-1900s, mills, manufacturing plants and other sites of heavy industry were concentrated in cities. As industry moved to the suburbs, and later, overseas, many urban neighborhoods were left with an abundance of brownfield sites, or parcels with “dirty dirt.”

Brownfield sites can be polluted in any number of ways, by contaminants such as chemical spills, oil pooling and heavy metals. Special testing, cleanup procedures and ongoing monitoring make brownfields incredibly expensive to remediate. Owners may turn a blind eye and potential buyers often shy away for fear of future liability. As a result, these sites typically lie fallow for years – or decades – and cause a significant drain on local economies. Many end up abandoned and cause pockets of blight in cities.

In order to restore these sites to productive uses, a partnership between public and private stakeholders is often required, as a recent What Works Case Study of Waterbury, Connecticut, illustrates.

The former Chase Metal Works site in Waterbury, Connecticut, provides an example. When the factory closed in the 1970s, a behemoth 600,000 square foot mill was left behind. Portions of the “Mile-Long Mill” were heavily contaminated; other sections were structurally unsound. Private owners tried to lease the facility but had little success. The site exchanged hands a number of times, and by 2007, the largest remaining tenant was threating that if the facility was not improved the company would leave, taking dozens of well-paying industrial jobs with it.

When rehabbing the facility and cleaning the site proved too costly for the building owners, the city acquired the property and secured a $15 million grant from the U.S. Department of Defense (DOD) to assist with remediation. It was an unlikely source of funding, as most brownfield dollars come from the U.S. Environmental Protection Agency (EPA). But Chase Metal Works once manufactured brass products for the U.S. military, so DOD supported cleanup efforts. The EPA contributed another $1 million and the City bonded more than $23 million to round out the first phase of rehabilitation and remediation efforts.

With that federal funding, the City of Waterbury was able to convince the existing industrial tenant not only to stay but also to expand at the site, later renamed the “Waterbury Industrial Commons.” The City continues to serve as the property owner and manager of the complex. Its redevelopment efforts have successfully attracted or retained hundreds of jobs and commercial leases are pulling in millions in new tax revenue each year.

Somerville, Massachusetts, has found success through a similar process. Like Waterbury, Somerville has a long industrial history. From the 1840s to 1980s, Somerville was a hub for heavy industry, including leadworks, brickyards, meatpackers and chemical storage facilities. With the decline of U.S. manufacturing, Somerville lost much of its employment base. Left behind were tens of thousands of residents living among vacant, heavily polluted sites and commuting to jobs in other cities.

New interest in cleaning up those sites was ignited when the local transit agency, the Massachusetts Bay Transportation Authority, committed to building the Green Line Extension through Somerville. The light rail would extend from Boston’s Lechmere station and make five stops in Somerville, including one rail spur to Somerville’s Union Square neighborhood.

The Green Line Extension provided an opportunity for Somerville to transform by creating more jobs within the city. The city is New England’s most densely populated, so any unused or underused land is ripe for redevelopment. The challenge, however, was that this vacant land was heavily contaminated.

A property known as the “Kiley Barrel” site, in reference to the company that once cleaned chemical drums there, is one such brownfield. It is adjacent to the planned Union Square Green Line Station, but the 1.3-acre site would cost more than $3 million to remediate. Even with the promise of lucrative new transit-oriented development, private developers shied away from the project, wary of the up-front costs.

The Somerville Redevelopment Authority acquired the property and began to aggregate the parcels that comprise the Kiley Barrel site. The U.S. EPA funded the assessment, and then contributed $1.2 million in grants that could be used toward cleanup. The Massachusetts Development Finance Agency (MassDevelopment) contributed another $950,000 toward clean up. With $2.15 million, the City was able to remediate the Kiley Barrel site to a level adequate to draw interest from the private sector.

Now, a private developer has been selected to redevelop the Kiley Barrel site and surrounding parcels – 15 acres in total. More remediation will be necessary, but the public sector’s initial investment paved the way for private sector redevelopment. The site will be home to hundreds of new jobs, residential units and, in 2018, a new train station.

These two different cities took similarly proactive approaches to brownfield remediation, as was discussed at a panel at the EPA’s 2015 Brownfields Conference. As both cities showed, participation of public and private sector players can be vital to transform brownfield sites into vehicles of economic growth, and initial public investment can kickstart job creation on former industrial sites in urban areas.