    [Senate Hearing 107-955]
    [From the U.S. Government Publishing Office]

                                                           S. Hrg. 107-955

                     SMART GROWTH AND ECONOMIC DEVELOPMENT

    =======================================================================

                                    HEARING

                                   BEFORE THE

                                  COMMITTEE ON
                          ENVIRONMENT AND PUBLIC WORKS
                              UNITED STATES SENATE

                          ONE HUNDRED SEVENTH CONGRESS

                                 SECOND SESSION

                                       ON

    S. 995, A BILL TO IMPROVE ENVIRONMENTAL POLICY BY PROVIDING ASSISTANCE
    FOR STATE AND TRIBAL LAND USE PLANNING, TO PROMOTE IMPROVED QUALITY OF
    LIFE, REGIONALISM, AND SUSTAINABLE ECONOMIC DEVELOPMENT, AND FOR OTHER
                                    PURPOSES

    S. 1079, A BILL TO AMEND THE PUBLIC WORKS AND ECONOMIC DEVELOPMENT ACT
     OF 1965 TO PROVIDE ASSISTANCE TO COMMUNITIES FOR THE REDEVELOPMENT OF
                                BROWNFIELD SITES

                                   __________

                                 MARCH 6, 2002

                                   __________

      Printed for the use of the Committee on Environment and Public Works

                          U.S. GOVERNMENT PRINTING OFFICE

    83-687                       WASHINGTON : 2003
    _______________________________________________________________________
    For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800, DC area (202) 512-1800 Fax: (202) 512-2250 Mail: stop SSOP, Washington, DC 20402-0001

                   COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                          one hundred seventh congress
                                 second session
                      JAMES M. JEFFORDS, Vermont, Chairman
    MAX BAUCUS, Montana                  BOB SMITH, New Hampshire
    HARRY REID, Nevada                   JOHN W. WARNER, Virginia
    BOB GRAHAM, Florida                  JAMES M. INHOFE, Oklahoma
    JOSEPH I. LIEBERMAN, Connecticut     CHRISTOPHER S. BOND, Missouri
    BARBARA BOXER, California            GEORGE V. VOINOVICH, Ohio
    RON WYDEN, Oregon                    MICHAEL D. CRAPO, Idaho
    THOMAS R. CARPER, Delaware           LINCOLN CHAFEE, Rhode Island
    HILLARY RODHAM CLINTON, New York     ARLEN SPECTER, Pennsylvania
    JON S. CORZINE, New Jersey           BEN NIGHTHORSE CAMPBELL, Colorado

                    Ken Connolly, Democratic Staff Director
                    Dave Conover, Republican Staff Director

                                C O N T E N T S

                                  ----------
                                                                       Page

                                 MARCH 6, 2002
                               OPENING STATEMENTS

    Campbell, Hon. Ben Nighthorse, U.S. Senator from the State of
      Colorado.......................................................    30
    Chafee, Hon. Lincoln, U.S. Senator from the State of Rhode Island     2
    Jeffords, Hon. James, U.S. Senator from the State of Vermont.....     1
    Wyden, Hon. Ron, U.S. Senator from the State of Oregon...........     4

                                   WITNESSES

    Anderson, Deb, director, Wood Partners, Durham, NC, representing
      the National Multi Housing Council.............................    17
        Prepared statement...........................................   197
    Bentley, Mary Lou, executive director, Western Nevada Development
      District, Carson City, NV, representing the National
      Association of Development Organizations.......................    23
        Prepared statement...........................................   219
    Chen, Don, director, Smart Growth America, Washington, DC........    19
        Prepared statement...........................................   211
    Garczynski, Gary, president, National Association of Home
      Builders, Washington, DC.......................................    22
        Prepared statement...........................................   215
        Responses to additional questions from Senator Jeffords......   217
    Humstone, Elizabeth, executive director, Vermont Forum on Sprawl,
      Burlington, VT, representing the American Planning Association.    15
        Prepared statement...........................................    40
    Levin, Hon. Carl, U.S. Senator from the State of Michigan........     6
        Prepared statement...........................................     7
    Sampson, David, Assistant Secretary for Economic Development,
      U.S. Department of Commerce....................................    10
        Prepared statement...........................................    30
        Responses to additional questions from:
            Senator Jeffords.........................................    35
            Senator Smith............................................    39

                              ADDITIONAL MATERIAL

    Comments, Paul S. Barru on behalf of the American Road and
      Transportation Builders Association; International Council of
      Shopping Centers; National Apartment Association; National
      Association of Home Builders; National Association of
      Industrial and Office Properties; National Association of
      Realtors; National Multi Housing Council; and Self Storage
      Association....................................................   199
    Letters from:
        American Institute of Architects, American Planning
          Association, American Society of Landscape Architects,
          Defenders of Wildlife, National Association of Regional
          Councils, Natural Resources Defense Council, National Trust
          for Historic Preservation, National Wildlife Federation,
          Scenic America, Sierra Club, Smart Growth America..........    47
        Vermont Forum on Sprawl, Association of Vermont Conservation
          Commissions, Conservation Law Foundation, Friends of the
          Earth, Preservation Trust of Vermont, Vermont Public
          Interest Research Group, Vermont Natural Resources Council,
          Vermont Planners Association...............................    48
    Statement, National Association of Realtors......................   221
    Survey, American Planning Association, Planning for Smart Growth,
      2002 State of the States.......................................50-196
    Texts of bills:
        S. 975, Community Character Act of 2001.....................224-236
        S. 1079, Brownfield Site Redevelopment Assistance Act of 200237-250

                     SMART GROWTH AND ECONOMIC DEVELOPMENT

                                  ----------

                            WEDNESDAY, MARCH 6, 2002

                                   U.S. Senate,
             Committee on Environment and Public Works,
                                                Washington, DC.
        The subcommittee met, pursuant to notice, at 9:34 a.m. in
    room 406, Dirksen Senate Office Building, Hon. James M.
    Jeffords (chairman of the committee) presiding.
        Present: Senators Jeffords, Chafee, and Wyden.
        Also present: Senator Levin.

    OPENING STATEMENT OF HON. JAMES M. JEFFORDS, U.S. SENATOR FROM
                          THE STATE OF VERMONT

        Senator Jeffords. Good morning. I'd like to begin by
    thanking all the witnesses for participating in today's
    hearing. I am really looking forward to listening to your
    testimonies.
        Today's hearing stems from a long-term interest in helping
    our cities and towns become economically vibrant and culturally
    cohesive communities. One of the best ways to support these
    efforts is to provide our communities with growth planning and
    redevelopment tools.
        I have always been involved in smart growth efforts since
    the 1960's, when I served as a Vermont State Senator and
    Attorney General of Vermont. I'm proud to have had a major role
    in drafting Vermont's development review plans that became Act
    250, the first and most comprehensive State-level growth
    management policy in the United States.
        I have continued my activities with regard to smart growth
    during my tenure in both the House and Senate. In January 1999,
    I established a Senate Smart Growth Task Force, a bipartisan
    and multi-regional caucus. Twenty-three Senators currently
    participate in the task force. The overall goal of the task
    force is to determine how the Federal Government can help
    States and localities address their own growth management
    problems.
        Growth decisions should be made ultimately at the local
    level; however, the Federal Government needs to continue
    assessing Federal policies that may interfere with local
    government growth management. For example, the national
    interstate system has had a tremendous impact upon local
    development patterns. Over the past 10 years, we have brought
    substantial attention to the issue through the transportation
    and planning process. We will address this issue in our
    upcoming hearing on transportation and smart growth.
        The Federal Government also needs to provide communities
    with the necessary tools and resources to achieve local growth
    objectives. I believe that the two bills before us today help
    us make great strides in that direction.
        With the recent enactment of the Small Business Liability
    Relief and Brownfields Revitalization Act, we have made great
    progress in addressing local liability and financial concerns.
    Through the Brownfields Site Redevelopment Assistance Act, we
    have an opportunity to complement these efforts. S. 1079 will
    address the next step after assessment and cleanup. The step is
    which communities actually begin redeveloping the sites.
        The economic benefits are incredible. The U.S. Conference
    of Mayors estimates that brownfields redevelopment could
    regenerate more than 550,000 additional jobs and up to $2.4
    billion in new tax revenues for the cities.
        The other bill we will discuss today is the Community
    Character Act. The bill presents another important opportunity
    to provide communities that wish to plan prospectively and
    proactively with the resources to do so. This is especially
    important in my home State of Vermont. Rural communities
    frequently grapple with the lack of planning and resources and
    expertise. I recently learned from the distinguished Vermont
    witness that only 39 percent of rural governments do
    comprehensive planning, versus more than 70 percent of the
    metropolitan governments doing so. S. 975 provides necessary
    resources to even out that ratio.
        Finally, I am in the process of working on another smart
    growth legislative proposal. It will substantially improve
    decisionmaking capacity for local planners. The legislation
    will provide communities with the resource to access
    revitalization and modeling and other planning tools. I look
    forward to working with EPW colleagues on this legislation.
        I now turn to my good friend from Rhode Island. I
    appreciate the work you've done, especially more recent passage
    of the brownfields bill. You've done a great job and you are a
    great Senator.

    OPENING STATEMENT OF HON. LINCOLN CHAFEE, U.S. SENATOR FROM THE
                         STATE OF RHODE ISLAND

        Senator Chafee. Thank you, Mr. Chairman. Good morning.
        I introduced this legislation on May 25, 2001, and was
    joined by Senators Bennett, Specter, Jeffords, Cleland, Levin,
    Bingaman, and Lieberman in introducing the Community Character
    Act.
        The bill provides Federal assistance to States and Indian
    tribes to create or update State-wide or tribal land use
    planning legislation. Up-to-date planning legislation empowers
    States and local governments to spur economic development,
    protect the environment, coordinate transportation
    infrastructure needs, and preserve our communities.
        America has grown from east to west, as well as from an
    urban setting to a suburban one. The Nation's sweeping growth
    can be attributed to many things, including a strong economy
    and transportation and technology advancements that allow
    people to live greater distances from work due, in part, to
    inadequate planning, strip malls, and retail development
    catering to the automobile have become the trademark of the
    American landscape.
        In the wake of the post-World War II building boom, my home
    town of Warwick, RI, had experienced the type of development
    that too often offends the eye and saps our economic strength.
    Due to a lack of planning, incremental and haphazard
    development occurred through a mixture of incompatible zoning
    decisions. Industrial and commercial facilities and residential
    homes were frequently and inappropriately sited next to each
    other. The local newspaper described the city as a suburban
    nightmare. However, we learned that proper approaches to
    planning would help every State meet its challenges, whether it
    is preserving limited open space in the east or protecting
    precious drinking water supplies in the west.
        The Community Character Act will benefit each community and
    neighborhood by authorizing the Economic Development
    Administration to provide $25 million per year to States and
    tribes for the purpose of planning. The bill recognizes that
    land use planning is appropriately vested at the State and
    local levels and accords States and tribes flexibility in using
    their grants. The bill does not prescribe any particular
    approach to land use planning because, of course, each
    community must decide for itself what is appropriate. Mistakes
    made through haphazard development are very costly and not
    easily erased. Once started down that path, communities may
    feel like they can never get their head above water.
        I view this legislation as an opportunity for the Federal
    Government to play a limited but helpful role. In the past, the
    Federal Government has been more of a culprit than a partner.
    Through enactment of numerous and oftentimes incompatible laws
    regarding transportation, housing, environment, energy, and
    economic development, the Federal Government has created demand
    for State and local planning.
        The Community Character Act should be viewed as providing
    the Federal payment for a non-funded mandate whose account is
    overdue. The Senators who have sponsored the bill represent
    geographically diverse States, from Rhode Island to New Mexico,
    from Georgia to Utah. This bipartisan bill represents a small
    investment in our communities, but one that will yield large
    dividends to communities in each corner of the Nation.
        I note that one of the cosponsors is Senator Bennett. Of
    course millions all over the world, if not billions, saw the
    value of Salt Lake City, but that city, evidenced by the fact
    that Senator Bennett is cosponsor, is experiencing lack of
    planning in its growth, and Senator Bennett said in 1846 when
    Brigham Young came over the mountains he was not well, and he
    was lying in his covered wagon, and as they came over the
    mountain they asked, ``How does it look,'' and he sat up in his
    wagon and said, ``This is the right place, move on.'' Of
    course, Salt Lake City was developed. We want it to be
    beautiful, and I think this bill would help make it stay
    beautiful, as millions around the world, billions around the
    world saw what a beautiful place it is. We want to make sure it
    stays that way, and all over the rest of the United States,
    also.
        Thank you, Mr. Chairman.
        [The prepared statement of Senator Chafee follows:]
      Statement of Hon. Lincoln D. Chafee, U.S. Senator from the State of
                                  Rhode Island
        Good morning. Thank you, Mr. Chairman, for conducting today's
    hearing on the Community Character Act of 2001. I introduced this
    legislation on May 25, 2001 and was joined by Senators Bennett,
    Specter, Jeffords, Cleland, Levin, Bingaman, and Lieberman. The bill
    provides Federal assistance to States and Indian tribes to create or
    update statewide or tribal land use planning legislation. Up-to-date
    planning legislation empowers States and local governments to spur
    economic development, protect the environment, coordinate
    transportation and infrastructure needs, and preserve our communities.
        America has grown from East to West, as well as from an urban
    setting to suburban one. The nation's sweeping growth can be attributed
    to many things, including a strong economy and transportation and
    technology advancements that allow people to live greater distances
    from work. Due in part to inadequate planning, strip malls and retail
    development catering to the automobile have become the trademark of the
    American landscape.
        In the wake of the post-World War II building boom, my hometown of
    Warwick, Rhode Island had experienced the type of development that too
    often offends the eye and saps our economic strength. Due to a lack of
    planning, incremental and haphazard development occurred through a
    mixture of incompatible zoning decisions. Industrial and commercial
    facilities and residential homes were frequently and inappropriately
    sited next to each other. The local newspaper described the city as a
    ``suburban nightmare''. However, we learned that proper approaches to
    planning would help every State meet its challenges, whether it is
    preserving limited open space in the East or protecting precious
    drinking water supplies in the West.
        The Community Character Act will benefit each community and
    neighborhood by authorizing the Economic Development Administration to
    provide $25 million per year to States and tribes for the purpose of
    planning. The bill recognizes that land use planning is appropriately
    vested at the State and local levels, and accords States and tribes
    flexibility in using their grants. The bill does not prescribe any
    particular approach to land use planning, because each community must
    decide for itself what is appropriate.
        Mistakes made through haphazard development are very costly and not
    easily erased. Once started down that path, communities may feel like
    they can never get their head above water. I view this legislation as
    an opportunity for the Federal Government to play a limited, but
    helpful role. In the past, the Federal Government has been more of a
    culprit than a partner. Through enactment of numerous and often-times
    incompatible laws regarding transportation, housing, environment,
    energy, and economic development, the Federal Government has created a
    demand for State and local planning. The Community Character Act should
    be viewed as providing the Federal payment for an unfunded mandate
    whose account is overdue.
        The Senators who have sponsored this bill represent geographically
    diverse States, from Rhode Island to New Mexico and from Georgia to
    Utah. This bipartisan bill represents a small investment in our
    communities, but one that will yield large dividends to communities in
    each corner of the Nation.
        Thank you, Mr. Chairman.

        Senator Jeffords. Thank you.
        Do you have a statement, Senator Wyden?

      OPENING STATEMENT OF HON. RON WYDEN, U.S. SENATOR FROM THE
                            STATE OF OREGON

        Senator Wyden. Thank you, Mr. Chairman. First let me say
    I'm glad you are on the mend. I think last night we were
    concerned that you were ill, so I'm glad you're here and able
    to chair.
        Senator Jeffords. Thank you.
        Senator Wyden. Congratulations to you for all the work that
    you've done on smart growth issues over the years, really going
    back to your days as Attorney General, and also to Senator
    Chafee and Senator Levin, who have really championed these
    issues for some time.
        What is so striking is how little the Federal Government
    has done over the years to promote smart growth. I think
    Senator Levin might even remember that Senator Jackson of
    Washington State was one of the first to introduce a smart
    growth bill years ago when he was in the U.S. Senate, and it
    was basically labeled a communist plot. This very modest bill
    that Senator Jackson from my region had introduced was
    essentially described as a Federal zoning bill, an approach
    that was going to sweep out all efforts at the State and local
    level to promote smart growth. So it is striking that finally
    government at all levels is recognizing how important it is by
    the work that Senator Levin and Senator Chafee are doing, and,
    of course, the work that our chairman has done over the years
    has been a great catalyst.
        At this point, as far as I can tell, there is only one
    Federal law on the books that promotes smart growth. I admit to
    being a little biased, because it came from this committee, and
    Senator Moynihan helped me put it in place. What we did as part
    of TEA-21 in 1997 was author the first program to provide
    incentives for State and local government to promote local
    smart growth policies. It's called the Transportation and
    Community System Preservation Act, by the way. Then chairman
    John Chafee was very supportive of that effort, as well. In
    just 5 years this particular program has grown from a modest
    $20 million program to one that provides over $100 million of
    funding for smart growth projects that are connected to
    transportation this year.
        It seems to me what Senator Chafee's legislation does is
    build on that effort with TEA-21 to provide comprehensive smart
    land use planning by States, tribes, and cities so as to take a
    similar approach to economic development that the TEA-21 pilot
    project program has used in the transportation area.
        My home State of Oregon, we consider ourselves pioneers in
    the development of smart growth. Brownfield redevelopment
    really combines smart growth and a variety of other public
    policies that make sense because it is certainly less costly to
    redevelopment formerly contaminated brownfield sites than to
    build in pristine greenfield sites that contribute to urban
    sprawl, so this type of redevelopment that turns polluted
    former industrial sites into new homes and new businesses is
    probably the ultimate form of recycling and smart growth.
        I congratulate the sponsors, and I look forward to Senator
    Levin's contribution this morning. His legislation recognizes
    that the process of redevelopment doesn't end when the
    pollution is cleaned up, and that the Federal Government can
    help communities complete the process of revitalization and
    ensure that these sites are recycled into productive use.
        I look forward to working with you and our colleagues, Mr.
    Chairman.
        Senator Jeffords. Thank you for your excellent statement.
        Now we turn to Carl Levin. He is the sponsor of S. 1079,
    the Brownfield Site Redevelopment Assistance Act, which is one
    of the two bills being discussed here today. Senator Levin is
    also my co-chair on the Senate Smart Growth Task Force.
        It is a pleasure to have you here. Please proceed.

     STATEMENT OF HON. CARL LEVIN, U.S. SENATOR FROM THE STATE OF
                                MICHIGAN

        Senator Levin. Mr. Chairman, thank you. Senator Wyden,
    Senator Chafee, it is good to be with you all on a subject that
    is dear to the hearts of all of us. You've all been very deeply
    involved in smart growth efforts. We've had some successes
    actually recently in the smart growth area with the Brownfields
    Act, which eliminated some of the liability problems which
    prevented brownfields from being cleaned up and redeveloped.
    That was a great success story which this committee was very
    deeply involved in, and I congratulate you for it. You've all
    been involved in this effort.
        As Senator Jeffords just mentioned, he and I co-chair a
    task force, a Smart Growth Task Force which is bipartisan,
    which is also multi-regional. All of our regions in one way or
    another are very deeply involved in this area. We are affected
    when we do not grow smartly, when we just use up greenfields
    and we don't recycle land. We recycle bottles and cans and
    newspapers. We have to recycle our land, too, and not just let
    it go to waste, as we too often have.
        The two bills which are before you today are efforts in
    this direction. In the bill that was referred to, the
    Brownfield Site Redevelopment Assistance Act, which is Senate
    bill 1079, we do a number of things in that bill. We provide
    additional funds, $60 million each year for 5 years, for
    brownfields redevelopment. This will give the EDA the authority
    to provide grants for brownfields redevelopment projects,
    including development of public facilities; business
    development, including revolving loan funds; technical
    assistance and training; activities to help communities
    diversify their economies; and encourage in-fill development.
        EDA has a current cap on their authorization appropriations
    at $335 million. We would add $60 million for this particular
    focus, purpose.
        Until this year, the EDA has made brownfields redevelopment
    as one of its priorities, but in this year's EDA request they
    leave out that designation. In other words, with the limited
    pot of money that it has, when it submitted its budget this
    year brownfields redevelopment was not included as a funding
    priority, meaning there is not as strong a commitment at the
    EDA, if their budget is adopted as presented, as there has been
    in recent years where there was a priority given to brownfields
    redevelopment. So the adoption of our bill will help give a
    priority to that redevelopment, as well as some additional
    funding for it.
        We have the support of a whole host of organizations, and
    I'll end with just this very brief reference. These are just
    some of the organizations which support this legislation: the
    National Association of Counties, the National Association of
    Towns and Townships, the National League of Cities, the U.S.
    Conference of Mayors, Council for Urban Economic Development,
    the Enterprise Foundation, National Association of Business
    Incubators, National Association of Development Organizations,
    National Association of Regional Councils, National Congress
    for Community Economic Development and Smart Growth America.
    There are other entities, as well.
        I want to thank you, Mr. Chairman and members of this
    committee, for holding this hearing, for your support for smart
    growth. You've all been leaders in this effort, and I feel that
    I am not only among friends in presenting my thoughts to you,
    but that in many cases you are way ahead of me in a number of
    these areas, and it is a real treat just to be with people who
    are so committed to a very important cause.
        Senator Jeffords. Thank you very much.
        [The prepared statement of Senator Levin follows:]
     Statement of Hon. Carl Levin, U.S. Senator from the State of Michigan
        Mr. Chairman and members of the committee, thank you for holding
    today's hearing on smart growth issues.
        It is my honor to co-chair the Senate Smart Growth Task Force with
    Chairman Jeffords. We established this multi-regional bipartisan task
    force in 1999 to provide Senators with a forum to consider and
    coordinate efforts concerning sustainable growth patterns. The overall
    goal of the Task Force is to determine and promote ways the Federal
    Government can assist States and localities to address their own growth
    management issues. As part of that effort we have jointly sponsored and
    supported legislation that we believed would achieve this goal. Two of
    these bills are the focus of today's hearing: The Brownfield Site
    Redevelopment Assistance Act of 2001 (S. 1079); and The Community
    Character Act (S. 975).
        Mr. Chairman, under your leadership I am hopeful that these two
    important community development bills can be enacted this year. They
    will provide States and communities with the tools they need to better
    plan for land use and development in order to improve the quality of
    life of our citizens.
        Brownfields redevelopment is one of the most important ways to
    revitalize cities and implement growth management. The redevelopment of
    brownfields is a fiscally sound way to bring investment back to
    neglected neighborhoods, cleanup the environment, reuse infrastructure
    that is already paid for and relieve development pressure on our urban
    fringe and farmlands.
        Under this committee's initiative and leadership, Congress recently
    took the important step of increasing funding for brownfields cleanup
    and providing necessary liability relief by enacting H.R. 2869 (S. 350)
    the Small Business Liability Protection and Brownfield Revitalization
    Act. That legislation will go a long way to help communities across the
    country start cleaning up and reusing the thousands of brownfields
    sites that now sit idle.
        With THE big brownfields law enacted, it is tempting to think that
    we have solved the brownfields problem. But States, regional councils
    and local communities need financial assistance to make brownfields
    redevelopment happen. One way to do this is to give communities more
    tools to redevelop and promote the economic reuse of brownfield sites
    once they have been cleaned.
        S. 1079, the Brownfield Site Redevelopment Assistance Act would do
    this. Senators Jeffords and I, along with Senators Baucus, Reid and
    Lieberman introduced this bill to expand the Department of Commerce's
    Economic Development Administration (EDA) efforts to assist communities
    with economic development. The bill authorizes a program to provide
    targeted assistance for projects that redevelop brownfield sites. The
    bill will provide EDA with increased funding flexibility to help
    States, local communities, Indian tribes and nonprofit organizations
    restore these sites to productive use. The bill authorizes $60 million
    each year for 5 years for brownfields redevelopment. It gives EDA the
    authority to provide grants for brownfields redevelopment projects,
    including:
         Development of public facilities
         Business development (including revolving loan funds)
         Technical assistance and Training
         Activities to help communities diversify their economies
    and encourage infill development
         Collaborative economic development planning.
        While EDA assistance has helped communities redevelop brownfields,
    the agency lacks a specific authority and a dedicated source of funding
    for brownfields. As a result, there is no guarantee that the agency
    will be able to sustain the level of investment it has made in recent
    years. The current ``cap'' on EDA appropriations at the authorization
    level of $335 million will significantly affect the ability of the
    agency to support future brownfield redevelopment activities.
        This bill would provide EDA with the authority to facilitate
    effective economic development planning for reuse; develop
    infrastructure necessary to prepare sites for re-entry into the market;
    and, provide the capital necessary to support new business development.
    It would also make brownfields redevelopment a priority for EDA. Our
    nation's population is growing and we need to find creative ways to
    accommodate growth while improving the lives of our residents and
    protecting our land, air and water. With limited Federal resources
    available to help communities with these important goals, it is
    critical that we encourage the reuse of our land. We recycle cans,
    bottles and newspaper B we must also recycle our land.
        In communities across Michigan and across the country, the
    prevalence of brownfields sites is an obstacle to development. When
    redeveloped, these sites offer new opportunities for businesses,
    housing and green space. Undeveloped brownfields sites force expansion
    into green areas and open spaces, and many communities need support in
    order to reuse these sites. This bill would help to provide additional
    resources to communities and States to assist their brownfields
    conversion efforts.
        The U.S. Conference of Mayors estimated that brownfields
    redevelopment could generate more than 550,000 jobs and up to $2.4
    billion in new tax revenues. This legislation aims to support local
    communities and States in their efforts to reclaim brownfields by
    providing economic development resources to revitalize these sites.
        Testimony to the critical need for this additional brownfields
    redevelopment funding is the support for the bill of the following
    organizations: National Association of Counties, National Association
    of Towns and Townships, National League of Cities, the U.S. Conference
    of Mayors, the Council for Urban Economic Development; Enterprise
    Foundation, National Association of Business Incubators, National
    Association of Development Organizations, National Association of
    Installation Developers, National Association of Regional Councils,
    National Congress for Community Economic Development, and Smart Growth
    America.
        I am pleased the committee is taking up this legislation. It
    clearly complements the resources and liability clarifications enacted
    in H.R. 2869 (S. 350). It is a logical next step to provide communities
    with the financial assistance needed to leverage private investment in
    brownfields and accelerate reuse.
                                     ______

              Brownfield Site Redevelopment Assistance Act of 2001
                               Section-by-Section
        Section 1. Short Title.--Brownfield Site Redevelopment Assistance
    Act of 2001
        Section 2. Purposes.--To provide targeted assistance through the
    Department of Commerce's Economic Development Administration for
    projects that promote the redevelopment and economic recovery of
    brownfield sites in order to bring new income and private investment to
    distressed communities.
        Section 3. Definitions.--Defines brownfield site (same definition
    as in the Small Business Liability Protection and Brownfield
    Revitalization Act). Permits the Secretary of Commerce in consultation
    with the EPA Administrator to include other pollutant or contaminants
    in the definition of brownfields. Other pollutants may include
    petroleum, lead and asbestos. EDA funding can current be used for
    remediation of these contaminants.
        Section 4. Coordination.--Recommends that the Secretary of Commerce
    coordinate brownfields redevelopment activities with other Federal
    agencies, States, local governments, consortia of local governments,
    Indian tribes, nonprofit organizations and public-private partnerships.
        Section 5. Grants for Brownfield Site Redevelopment.--Makes grants
    available through EDA for brownfields projects that alleviate excessive
    unemployment, underemployment, blight and infrastructure deterioration.
    Projects include: development of public facilities, development of
    public services, business development, planning, technical assistance
    and training. Grants may also be made available for activities
    identified by a community negatively impacted by brownfields. These
    activities include: diversifying the economy; carrying out industrial
    or commercial redevelopment projects; promoting smart growth through
    infill development that conserves environmental and agricultural
    resources; and carrying out collaborative economic development
    planning.
        Section 6. Authorization of Appropriations.--Authorizes $60 million
    for each fiscal years 2002 through 2006.

        Senator Jeffords. What limits does EDA currently have
    regarding their ability to do brownfields redevelopment?
        Senator Levin. As I indicated, they could, if they put a
    priority on it, use their money for this purpose, but they have
    a cap on those funds. We would designate the money in this bill
    specifically for this purpose. Also until this year, they have
    at least identified brownfields redevelopment as a priority for
    their funding, and this year they left that out, which means
    that in their view it is not a priority. So we do two things--
    we add funds that otherwise are not designated for this
    purpose, and, we add emphasis and we add a targeting, a
    priority to the EDA which apparently is not otherwise assured.
    It is there some years, other years not. So we would guarantee
    that a priority and an emphasis be given to this particular
    purpose, as well as additional funding for it.
        Senator Jeffords. Senator Chafee.
        Senator Chafee. Thank you, Senator Levin.
        What is your experience in Michigan on these lines? Are
    there many brownfield sites in Michigan?
        Senator Levin. There are huge numbers, and actually my
    State has taken some very important initiatives in the
    brownfields area. To the extent that we have been able to, we
    have eliminated those really almost bizarre liability problems,
    which have so often deterred the cleanup and the reuse of
    brownfields, making subsequent owners liable to people, making
    banks who would subsequently lend money on mortgages liable for
    any damages which had previously been caused. I mean, you're
    not going to get people to undertake a piece of land, clean it
    up, and reuse it if they are going to be liable for previous
    damages which were caused to people before they took over the
    land.
        Michigan has done everything that it could do in that area
    and has promoted significant brownfields redevelopment, and I
    want to give credit to the Governor and the legislature in
    Michigan for doing that.
        Our bill was your bill I think a year or two ago when we
    took on the liability issue, then removed some of EPA's hurdles
    which it had placed to brownfields redevelopment based on some
    of those I consider to be irrational, almost, liability
    problems. So at a national level, with the adoption of that
    bill we removed some additional hurdles. Even before that
    Michigan had done everything it could do, I think, reasonably
    to remove the hurdles at the State level in terms of State law
    for people who were willing to undertake brownfields reuse.
        Senator Chafee. OK, similar to my State of Rhode Island,
    I'm sure, a little industrial background, and we want to get
    them back on the tax rolls. They sit fallow and not providing
    revenue to our municipalities, which, of course, then we can
    put those property taxes to good use building schools or fixing
    roads, all the demands upon those officials in these
    communities. We removed, as you said, a lot of the liabilities
    in the previous bill, but your bill gives us the juice now to
    do it.
        Senator Levin. Thank you.
        Senator Jeffords. Senator Wyden.
        Senator Wyden. What kind of employment, Carl, do you think
    is created by legislation that will help redevelop these
    brownfields? It seems to me that, in addition to all the pluses
    that you've already stated about your bill, which I strongly
    support, there's also a good component as an economic catalyst.
    What's your sense there?
        Senator Levin. Well, the Conference of Mayors has estimated
    that brownfields redevelopment could generate more than a half
    million jobs, and, as Senator Chafee has pointed out, also
    generate up to $2.4 billion in new tax revenues. So the jobs
    point, which is an important point, is there.
        The revenue for local communities, which are really
    strapped now, particularly in a recession--I mean, we've got
    local communities that have been pushed to the brink and over
    the brink as a result of this recession that really need this
    kind of tax revenue. So from both aspects it is a huge plus, as
    well as a number of other benefits in terms of reusing land
    instead of leaving it lie fallow from a purely social
    perspective and a community perspective.
        Senator Wyden. I don't have any other questions, but I just
    think you're making a very big contribution with your bill, and
    I literally go back to the Scoop Jackson days that I touched
    on, when not only was this not regarded as constructive, but
    somehow this was seen as preempting local authorities.
        I think if you look at the kind of bills that we are
    advancing now as part of the Smart Growth Task Force and your
    legislation and Senator Chafee's legislation, in no way are we
    preempting local prerogatives. What your legislation does is
    puts the Federal Government in the business of being a good
    partner on the brownfields legislation. That's what we did on
    TEA-21 and the bill that I authored with Senator Chafee's dad
    and Senator Moynihan, so godspeed for your cause, and we'll
    help any way we can.
        Thank you, Mr. Chairman.
        Senator Jeffords. Thank you.
        Senator Levin. Thank you. Can I just add one comment?
        Senator Jeffords. You can say anything you want.
        Senator Levin. One thought, because you mentioned Scoop
    Jackson and you mentioned your Dad, both of whom are great
    heroes of mine, as a matter of fact, and great champions of
    communities. I probably shouldn't get too sentimental here,
    other than to say the invocation of both of those former
    colleagues and friends of mine is very meaningful to me.
        Senator Jeffords. Thank you very much. We look forward to
    working with you.
        Our next witness is Dr. David Sampson, Assistant Secretary
    for Economic Development at the U.S. Department of Commerce.
    Both of the bills being discussed here today would come under
    the jurisdiction of the Economic Development Administration.
        Dr. Sampson, thank you for being here today. We look
    forward to your statement.

     STATEMENT OF DAVID SAMPSON, ASSISTANT SECRETARY FOR ECONOMIC
                DEVELOPMENT, U.S. DEPARTMENT OF COMMERCE

        Mr. Sampson. Thank you, Chairman Jeffords. Senator Chafee,
    good to see you both again.
        I appreciate the opportunity to appear before the committee
    regarding the Economic Development Administration's role
    supporting brownfields revitalization and development planning.
    I do have a written statement that I would ask be entered into
    the record, and with your permission would like to summarize
    that testimony at this time.
        Senator Jeffords. It will be entered and you may summarize.
        Mr. Sampson. Thank you.
        The Administration, the Department of Commerce, and the
    Economic Development Administration recognize the need for
    brownfield revitalization and strategic land use planning
    objectives that are the focus of S. 1079 and S. 975. EDA has an
    established track record of working with local stakeholders to
    redevelop and reuse brownfields and has partnered with the
    Environmental Protection Agency to provide assistance similar
    to what is outlined in these bills.
        The President has announced that his fiscal year 2003
    budget will double the funds available through EPA from $98
    million in 2002 to $200 million in the 2003 budget to help
    States and communities around the country cleanup and
    revitalize brownfields sites; however, given the demands on the
    Federal budget to fight the war on terrorism and safeguard our
    national and homeland security, the Administration cannot
    support the additional funding beyond the increased funding
    already in the President's budget for this item.
        The Economic Development Administration has a longstanding
    role in supporting economic redevelopment of abandoned, idled,
    and contaminated industrial and commercial sites. As a matter
    of fact, since 1997 EDA has invested over a quarter of a
    billion dollars in 250 brownfield redevelopment projects, and
    last year, alone, EDA invested $55 million in 58 brownfield
    projects around the country. That's close to the level
    authorized in S. 1079.
        EDA's flexible economic development programs, as you have
    referenced earlier--you and Senator Chafee both in your opening
    comments--have provided a wider range of tools that local
    communities can use through EDA to facilitate the
    redevelopment.
        EDA has been a long-time supporter of the Environmental
    Protection Agency's brownfields initiative and was the first
    Federal Agency to enter into a partnership agreement with EPA,
    signing a memorandum of understanding in 1995, and a
    reauthorization of that memo is prepared and is awaiting the
    signatures of Secretary Evans and Administrator Whitman at this
    time.
        Now, as the President stated upon signing EPA's landmark
    brownfields legislation in January, we believe the key to
    effectively and efficiently addressing the brownfields
    redevelopment challenges is for the Federal Government to
    pursue a more cooperative, common-sense approach. This
    brownfields legislation was passed with bipartisan support, and
    the legislation recognizes and supports State efforts directed
    at regulatory relief and market-based incentives for
    redevelopment.
        An example of an effective market-based incentive that we
    strongly support but was not included in EPA's legislation is
    the brownfields tax incentive. This incentive allows for
    environmental cleanup costs to be fully depreciated in the year
    they are incurred, rather than being amortized and depreciated
    over the life of the property.
        Under current law, favorable tax treatment for the
    contamination cleanup costs will expire at the end of 2003. As
    proposed in the President's fiscal year 2003 budget, the
    Administration believes that the brownfields tax incentive
    should be made permanent. According to Government estimates,
    the $300 million annual investment in the brownfields tax
    incentive will leverage approximately $2 billion in private
    investment and return 4,000 brownfields to productive use.
        Now, while there are many parallels between S. 1079 and
    EDA's current efforts to support brownfield revitalization
    efforts, portions of the bill represent a broad departure from
    EDA's mission. For example, the legislation calls for EDA to
    create parks, playgrounds, and recreational facilities. This
    type of development falls outside of EDA's principal mission as
    authorized by Congress.
        Finally, we are concerned that S. 1079 calls for resources
    that are not included in the President's budget. We believe
    that the objectives of this legislation can be best attained
    within current budgetary resources through improved
    coordination of existing programs, a market-based incentive
    approach, and a locally driven development process.
        Now, the committee also asked me to comment on the
    Community Character Act. Certainly in recent years concerns
    have been raised regarding the kinds of development occurring
    in America's suburban communities. We certainly believe that
    comprehensive, market-based local and regional planning is an
    essential component of successful, sustainable economic
    development, and for almost 40 years economic development
    planning has been a cornerstone of EDA's development programs.
    As a matter of fact, EDA is currently involved in and committed
    to local planning through its partnership planning program,
    which supports 325 multi-county economic development districts
    and 59 American tribes and Alaska Native villages.
        Since 1997, EDA has provided planning assistance matching
    the level of funding that would be provided through the
    Community Character Act.
        This process supports local planning by encouraging
    development of a regional comprehensive economic development
    strategy, or CEDS. The CEDS process is designed to guide the
    economic growth of an area through an inclusive and dynamic
    process that coordinates the efforts of community
    organizations, local governments, private industry, and
    economic development leaders. These grants can be used to
    enhance or update local land use plans, if that is the priority
    of participating local jurisdictions. While not prescriptive,
    local communities developing CEDS are encouraged by EDA to
    address economic issues and opportunities in a manner that
    promotes economic development, fosters effective transportation
    access, enhances and protects the environment, and balances
    resources through sound management.
        Again, the Administration cannot support S. 975 because it
    calls for resources that are not included in the President's
    budget to support activities that can be accomplished through
    existing authorities and appropriations.
        This Administration will continue to work for the American
    people to protect the quality of our air, land, and water,
    while building on the premise that environmental protection and
    economic prosperity go hand in hand. By working together with
    State and local communities and leveraging the Federal
    Government's current resources and coordinating the efforts
    among agencies, we can work effectively to create a market-
    based approach to develop and revitalize communities across the
    Nation.
        Thank you very much, Mr. Chairman and Senator Chafee for
    your leadership on these issues so important to us all. EDA
    appreciates your support and looks forward to working with you
    as we continue to achieve commonly held objectives. I would be
    happy to address any questions that you may have.
        Senator Jeffords. Thank you for your testimony.
        In your testimony you note that the Administration is
    seeking $200 million in fiscal year 2003 for EPA's brownfield
    program. How will EDA in a collaborating role keep up with
    EPA's activity without additional funding?
        Mr. Sampson. Well, first of all, we intend to renew the MOU
    that we have with EPA on those joint efforts, and, second, I
    would point out that in our recently published final notice of
    funding availability in the ``Federal Register,'' we do specify
    public works dollars will be used to support both tech-lead
    economic development and brownfield redevelopment projects, and
    so that is included in our final notice for public works
    projects for the coming year.
        Senator Jeffords. In your testimony you comment that your
    brownfields activities are under existing statutory authority.
    Does EDA have specific authority to engage in brownfields
    redevelopment work? Is this authority adequate?
        Mr. Sampson. I believe that we do, sir, and I believe that
    it is. As a matter of fact, in my short time at the helm at
    EDA, I've visited a number of brownfield redevelopment sites
    that EDA has worked on, and I think they are model
    redevelopment projects around the Nation.
        Senator Jeffords. How has EDA supported local development
    planning in the past? How can EDA improve that work, especially
    in the rural areas?
        Mr. Sampson. Well, EDA has a very long history of working
    with economic development districts around the country. In our
    40-year history, planning has been the cornerstone of EDA's
    economic development strategy.
        As I mentioned, since 1997 EDA has funded approximately
    $100 million to economic development districts, and last year,
    alone, we funded over $20 million to these economic development
    districts around the country, and we anticipate that that
    funding level will be maintained in next year's budget.
        Senator Jeffords. Thank you.
        Senator Chafee.
        Senator Chafee. Thank you, Senator.
        Welcome, Dr. Sampson.
        Mr. Sampson. Thank you very much, Senator Chafee.
        Senator Chafee. Good to see you again.
        Senator Jeffords mentioned a lot of growth is occurring in
    the western States. I think Nevada and Idaho have seen some of
    the sharpest population growth--and Arizona, New Mexico--of any
    States--Montana. As Senator Wyden said earlier, planning used
    to be considered almost a communist thought, especially in the
    west, but now these communities are saying, ``We've got to
    prepare. We've got to organize the growth and have the
    industrial growth where the people want the industry, and we
    want retail where our citizens want retail, and residential,
    all the zoning, where the people of our community want it.''
        We very carefully want to have the Federal Government
    involved in that, understanding that there is some reluctance
    to have the Federal Government involved, so this bill, the
    Community Character Act, would just make available the funds.
        My question is: does your Department have the capacity to
    dispense these funds if this bill were to be successful?
        Mr. Sampson. Senator, if the bill were passed and the funds
    were appropriated to us, EDA would obviously be careful
    stewards of that money and would ensure that any funds are
    expended wisely and are used effectively.
        As a former economic development professional at the State
    and local level in Texas, I am well aware that there are
    problems associated with the stress that growth brings on
    communities. In my travels around the country, I think that the
    primary concern that I've heard from State and local officials
    has been the lack of growth or stagnant growth in terms of job
    creation and the fear of losing core industries in States, and
    that's why in this year's notice of funding availability we
    have placed our first priority on assisting those communities
    that are going through economic dislocation or transition that
    are caused by changing economies.
        But certainly for those communities that are experiencing a
    unique distress caused by rapid growth, the existing planning
    dollars that we use through our partnership planning program
    can be used by those local economic development districts, and
    especially the rural areas that might not have as many
    resources, for the comprehensive land use planning as outlined
    in the bill.
        Senator Chafee. I would argue further that economic
    development would go hand-in-hand with a well-planned community
    where we don't--as I mentioned in my opening statement, my home
    town of Warwick, in the post-World War II boom--there was farm
    land in my home community, and it spilled out of the main city
    of Providence down there, and, as I said, strip malls and
    industry and retail and commercial and residential all--because
    there was no zoning to direct it, and we certainly--I would
    argue it inhibits economic development to have that kind of
    growth. As we see these western communities--Las Vegas; Boise,
    ID--just growing at a breakneck speed, I think everybody wants
    to have some kind of organization to it to promote economic
    development and good jobs and proper growth.
        Mr. Sampson. Senator, I certainly would concur that high
    performance and development standards generally yield premium
    return on investment for the development community, and my
    experience as an economic development professional is that the
    development community is as concerned as anyone about high
    development standards and performance standards so that they
    know that their investment is going to be protected over the
    long term.
        Further, the development community generally prefers to
    work in those communities where the rules of the game are
    clearly laid out so that they know that they can--if they come
    in and abide by those rules and development standards, that
    their development will proceed in a timely fashion.
        I do believe that, if you look around the country today,
    there is a very strong case that can be made that a locally
    centered, market-based approach that incorporates high
    performance and development standards does yield aesthetically
    pleasing, environmentally sensitive communities in which people
    want to live, work, and raise their families, and I think that
    those efforts at the local level are very appropriate.
        Senator Chafee. Good ringing endorsement. Thank you.
        Senator Jeffords. Thank you very much, Doctor. That was
    excellent testimony, and we look forward to working with you.
        Mr. Sampson. Thank you very much.
        Senator Jeffords. Our next witness is Elizabeth Humstone.
    Elizabeth is executive director of the Vermont Forum on Sprawl
    located in Burlington. She is co-author of a new American
    Planning Associations book, ``Above and Beyond.'' She comes
    here both as a Vermonter and as a representative of the APA.
        Welcome, Ms. Humstone.

     STATEMENT OF ELIZABETH HUMSTONE, EXECUTIVE DIRECTOR, VERMONT
      FORUM ON SPRAWL, BURLINGTON, VT, REPRESENTING THE AMERICAN
                          PLANNING ASSOCIATION

        Ms. Humstone. Good morning, Chairman Jeffords and Senator
    Chafee.
        I am Elizabeth Humstone. I am the executive director of the
    Vermont Forum on Sprawl and vice chair of the Burlington, VT,
    Planning Commission. I am here as a Vermonter and on behalf of
    the American Planning Association. I offer our vision for smart
    growth and support for the legislation under consideration by
    the committee, particularly S. 975, the Community Character
    Act.
        I know firsthand the daily struggle to achieve growth that
    supports environmental quality, rural working landscapes,
    healthy town centers, and community values of sharing, access,
    and equity.
        Americans are increasingly aware and concerned that
    unplanned growth and its byproducts--loss of open space,
    congestion, limited housing options, decline of neighborhoods,
    duplicative and costly infrastructure, empty shopping malls,
    and loss of ecological biodiversity--are major problems. This
    is not just a suburban phenomenon. It is impacting cities,
    rural areas, and tribal lands, as well.
        An alternative is smart growth, a movement taking root
    across the Nation as citizens seek ways of reversing decades of
    policies that have led to what is commonly referred to as
    ``sprawl.'' Smart growth is a set of policies designed not to
    stifle growth, as some critics would have it, but to promote
    development in ways that create efficient communities of
    balanced consumer choice and lasting value.
        Smart growth is a broad-based, grassroots-driven,
    bipartisan movement. Every political barometer--polls
    legislation executive orders, budget proposals, and ballot
    initiatives--indicates that planning reform and smart growth
    are major concerns.
        In Vermont, affordable housing advocates, businesses,
    developers, environmentalists, historic preservationists,
    community development specialists, planners, and social equity
    organizations are all working toward smart growth.
        Planning is essential to achieve smart growth. The plan and
    the process of planning helps communities move boldly forward
    with a clear vision and articulate agenda for shaping their
    future. In spite of the importance of planning, many States
    still rely on model planning laws developed by then Commerce
    Secretary Herbert Hoover in the 1920's. While useful and
    innovative for their time, these ordinances are woefully
    inadequate today. Many communities that want to plan are
    inhibited by these outmoded statutes.
        Even the States that have good planning laws are losing the
    battle to sprawl due to budget shortfalls, poor enabling
    statutes, and inability and failure to implement what they
    have. For example, in Vermont, despite, Mr. Chairman, your
    incredible efforts for smart growth in our State, we are known
    for interest and concern about growth issues but we still have
    sprawl, and it is getting worse. In Vermont we have no State
    planning office, no funds to enforce our Growth Management Act,
    and extremely limited resources to provide technical assistance
    to our many small towns.
        The American Planning Association believes that the
    Community Character Act would be an effective and beneficial
    tool for promoting smart growth and improving planning, while
    respecting local and State land use prerogatives. We are not
    alone. Broad-based coalitions working to strengthen communities
    and neighborhoods through improved built and natural
    environments have joined in support of this legislation.
        The bill provides flexible grants that could be used for a
    variety of planning and smart growth programs. States
    implementing reforms or seeking to bolster planning would be
    eligible for funding.
        The Community Character Act also is designed to promote
    locally driven planning innovation through resources, technical
    assistance, and capacity building. Many areas, particularly
    rural regions and small towns--as, Mr. Chairman, you indicated
    in your opening remarks--suffer from a lack of planning
    resources and expertise.
        At the Vermont Forum on Sprawl, we hear daily from citizens
    and local officials asking for help with local planning issues,
    and we are very hard pressed to meet this tremendous demand.
        In Vermont, the Community Character Act could help us to
    review our existing State planning statutes, and, with the
    involvement of diverse interest groups and citizens, propose
    ways to make them more effective. It could support a State-wide
    local planner training program, or it could help regional
    planning commissions and local governments arrive at better
    regional approaches to smart growth.
        All levels of government--Federal, State, regional, county,
    and local--have a proper role and responsibility in improving
    communities and supporting smart growth. Local governments have
    long and rightly been the principal stewards of land and
    infrastructure resources, yet Federal and State governments
    play important roles, as well.
        We believe Federal incentives and assistant for smart
    growth are appropriate for you to consider. There are a variety
    of Federal tools that could help Vermont and organizations like
    mine pursue smart growth. I have focused this morning on the
    Community Character Act. There is also the Brownfields Site
    Redevelopment Assistance Act and the Post Office Community
    Partnership Act, and, Mr. Chairman, your planned legislation to
    provide grant support for community visualization and
    decisionmaking technologies would also greatly aid smart growth
    planning efforts.
        We are committed to working with you, Mr. Chairman, and
    this committee in making the promise of smart growth a reality.
        This concludes my testimony. I thank you and the committee
    for the opportunity to be here today.
        Senator Jeffords. Well, thank you for an excellent
    statement.
        Our next witness is Deb Anderson. Deb Anderson is director
    of Wood Partners located in Durham, NC. She is representing the
    National Multi Housing Council, a national association
    representing the interests of the Nation's most prominent
    apartment firms.
        Ms. Anderson, thank you for joining us today.

    STATEMENT OF DEB ANDERSON, DIRECTOR, WOOD PARTNERS, DURHAM, NC,
            REPRESENTING THE NATIONAL MULTI HOUSING COUNCIL

        Ms. Anderson. Thank you. Chairman Jeffords and Senator
    Chafee, my name is Deb Anderson and I am the director of Wood
    Partners, a multi-family apartment, real estate development
    firm located in the Raleigh-Durham area of North Carolina. I am
    here today on behalf of the National Multi Housing Council and
    the National Apartment Association, both trade associations
    representing the Nation's multi-family property developers,
    owners, managers, and financiers.
        NMHC and NAA commend the members of this committee for
    their work on the important issue of strengthening America's
    communities. As I'm sure you already know, in recent years the
    concept of smart growth has taken the country by storm. In
    November 2000, more than 200 ballot initiatives were passed on
    suburban sprawl and open space preservation. While this is
    largely a State and local issue, there is also an important
    role for the Federal Government.
        We believe that the Community Character Act under
    consideration today fits that role by providing the funding and
    incentives needed to help State and local governments develop
    sound and comprehensive land use plans. Tired of struggling
    with traffic, pollution, long commutes, and over-crowded
    schools, Americans are calling for more livable communities.
    They are looking for pedestrian-friendly neighborhoods with
    more open space and better traffic flow. They are seeking
    communities with walkable distances between homes and nearby
    shopping, schools, and entertainment.
        Understanding that growth is inevitable, many State and
    local policymakers are searching for ways to expand without
    sacrificing quality of life. I know from my own experience in
    dealing with land use policymakers on the State and local
    levels that they face complex decisions as they endeavor to
    integrate all of the ingredients of a successful community into
    a specific land use decision.
        Increasingly, these decisionmakers are coming to appreciate
    that smart planning will require new ways of thinking and new
    regional approaches. Many are expanding their community
    development tool boxes to include important but often
    overlooked assets such as high-density housing.
        As a developer of high-quality apartment homes, I believe
    that apartments are an integral piece of the smart growth
    solution. Apartments conserve land to help preserve open spaces
    and create pedestrian-friendly neighborhoods. They also use
    municipal infrastructure more efficiently. For example,
    apartment households generate 30 to 40 percent fewer vehicle
    trips than single-family homes. Apartments place less burden on
    local schools and regional transportation systems. They help
    revitalize neglected neighborhoods, they create new jobs, and
    they provide local, State, and Federal tax revenues.
        Apartment homes are increasingly becoming the housing type
    of choice for a new demographic, representing both the aging in
    our population and the boom in younger households for the first
    time in 20 years.
        Many local governments still have barriers in place to
    higher-density housing, such as zoning programs that do not
    permit compact development. The end result is that apartment
    developers like myself, eager to design and deliver new
    pedestrian-friendly neighborhoods that citizens are calling
    for, are often blocked from doing so.
        This is where Congress can play a role. NMHC and NAA
    support S. 975's creation of a Federal grant program to provide
    States with the additional financial resources they may need to
    support and encourage local authorities to update their land
    use planning activities. The bill wisely relies on incentive-
    based measures rather than command and control systems. The
    bill also properly recognizes the need to explore regional land
    use planning. Smart growth issues often span the jurisdictional
    coverage of several communities, particularly in areas of
    transportation and economic development.
        While the need for regional planning is almost universally
    recognized, there are few effective models. S. 975 specifically
    states that multi-State land use planning should be facilitated
    through the grant program. This incentive will go a long way to
    jump-starting a fresh approach to regional planning.
        NMHC and NAA also strongly support the legislation's
    direction that a range of affordable housing options be
    included as a requirement by States before receiving Federal
    moneys. Communities that exclude apartments and other
    affordable housing jeopardize their own continued prosperity.
    In doing so, they squeeze out a segment of the population that
    is vital to local businesses, as both customers and employees.
    Communities that offer a diversified work force and a wide
    range of housing options are more likely to attract and retain
    top employers. An adequate supply of affordable housing,
    therefore, can be essential to a municipality's economic
    growth.
        The fact that S. 975 encourages consideration of affordable
    housing options will encourage communities to take a fresh look
    at their approach to this issue and consider ways they can
    support more affordable housing.
        This is particularly important in high-cost areas, where
    the price of land and the associated development costs have
    diminished the ability of the private market to create
    affordable housing on its own.
        NMHC and NAA support the Community Character Act with the
    understanding that the bill does not endorse by oblique
    reference any one particular land use planning standard. We are
    specifically concerned that the American Planning Association's
    recent publication, ``Growing Smart Legislative Guidebook,''
    not be viewed as the definitive land use guide. APA's guidebook
    contains many sound provisions, but it does not enjoy universal
    support among stakeholders. Dissenting comments pointing out
    where the book is unbalanced in its approach are attached to
    this testimony for your review.
        The important principle here is that we believe State and
    local jurisdictions must be free to study and employ a variety
    of planning tools as they deem appropriate. The Federal
    Government should encourage land use planning, but it should
    not specify the plan. Land use decisions should properly remain
    in the precinct of the local jurisdiction.
        We believe the provision to encourage pilot projects of new
    land use planning activities developed by local policymakers
    will help create smarter answers to our Nation's growth
    challenges. We also endorse the use of funds to develop
    voluntary educational programs, new technologies, and new
    electronic data bases to support land use planning and local
    policymakers who do not always have access to these resources.
        In summary, NHMC and NAA believe the role of the Federal
    Government in land use planning should be limited to funding
    through grants. As the Nation moves forward to strengthen its
    communities and accommodate changing demographics, local land
    use statutes will need to be responsive to the communities'
    needs. This bill is intended to provide support for State and
    local land use planning activities without undermining local
    land use control.
        Thank you very much.
        Senator Jeffords. Thank you.
        Our next witness is Don Chen, who is the director of Smart
    Growth America, a coalition of advocacy organizations working
    on growth management issues at the national, State, and local
    levels.
        Welcome, and please proceed.

        STATEMENT OF DON CHEN, EXECUTIVE DIRECTOR, SMART GROWTH
                        AMERICA, WASHINGTON, DC.

        Mr. Chen. Thank you very much. Mr. Chairman, Senator
    Chafee, thank you for holding today's hearing on smart growth.
        I am the executive director of Smart Growth America, a
    nationwide coalition of over 70 groups, including the American
    Farmland Trust, the Natural Resources Defense Council, the
    League of Women Voters for Smart Growth, the National Low
    Income Housing Coalition, and the Enterprise Foundation.
    Together we promote smart growth, an approach to development
    that makes efficient use of natural resources and
    infrastructure, revitalizes neighborhoods, keeps housing
    affordable, protects farmland and open space, and provides more
    transportation choices.
        Smart growth is a local issue, driven by the decisions of
    individuals and families, so people often ask if there is a
    Federal role. The answer is unequivocally yes. For decades the
    Federal Government has influenced the shape of America's
    communities through programs like the interstate highway system
    and FHA's home mortgage insurance program. The real question
    is: what is the appropriate role?
        There are four key roles: No. 1, to share information about
    best practices, tools, and research; No. 2, to provide
    financial assistance to help States and localities use
    resources more efficiently; No. 3, to identify ways in which
    smart growth can help communities meet Federal requirements;
    and, No. 4, to lead by example and be a good neighbor.
        Let me briefly elaborate.
        First, information sharing is a critical Federal
    responsibility, because States and localities do not have the
    capacity to conduct extensive research on innovations. The
    Department of Housing and Urban Development's new report on
    modern rehabilitation codes, for instance, shares information
    about an innovation which has boosted rehab investment in
    Newark, NJ, Jersey City, and Trenton by 68, 83, and 40 percent
    respectively.
        These innovations also include smart growth planning tools
    that model the fiscal and environmental outcomes of different
    growth scenarios, and software tools that enable the public to
    better visualize change. These tools have been applied with
    great success in places like Lancaster, PA; Salem, OR; San
    Diego, CA; and Kingston, RI.
        Mr. Chairman, I'm delighted to learn of your interest in
    these community decisionmaking tools and would welcome the
    opportunity to work with you to develop them further.
        Second, the Federal Government should provide financial
    assistance to support efforts to use economic and environmental
    resources more efficiently. For example, EPA recently provided
    a grant to the Envision Utah project. Using state-of-the-art
    demographic and land use projections, local leaders estimated
    that a smart growth scenario would save 171 square miles of
    open space, tremendously reduce traffic and commute times, and
    save the region $4.6 billion in infrastructure costs.
        Third, the Federal Government should identify ways in which
    smart growth can help communities meet Federal requirements. A
    great example is the Atlantic Station Development in Atlanta,
    GA, which applied smart growth principles to meet Federal air
    quality standards. At the request of the developer, EPA's
    technical staff determined that the project would reduce
    regional travel by 50 million miles per year because of its
    excellent public transit access, walkability, and compact
    street design.
        Fourth, the Federal Government should strive to be a good
    neighbor to States and localities that are pursuing smarter
    growth by, for example, locating its facilities in existing
    business districts and more efficiently disposing of HUD-
    foreclosed, abandoned buildings.
        Several trends underscore the need for Federal action. As
    Senator Chafee noted, communities nationwide are grappling with
    rapid growth. As a result, housing affordability remains a dire
    and persistent problem. According to the congressionally
    established Millennial Housing Commission, 28 million Americans
    do not have access to decent, affordable housing.
        Traffic problems are stifling the economies of regions all
    across America. Last year, congestion cost Americans $78
    billion in lost time and wasted fuel.
        Consumer housing preferences are also changing. According
    to a new study published by the Fannie Mae Foundation, aging
    baby boomers will drive a substantial shift in homebuyer
    preferences in which 31 to 55 percent of active homebuyers will
    prefer compact, walkable neighborhoods during the coming
    decade.
        As a response to these trends, Americans are demanding
    better choices for their communities. In recent years, voters
    have approved hundreds of measures to preserve open space and
    farmland. A poll released in 2000 by Smart Growth America found
    that Americans overwhelmingly support smart growth measures,
    from affordable housing production to increased public transit
    spending. Such support is also found at the local level. This
    week a poll by the University of Toledo will report that metro
    Toledans support similar measures very strongly.
        S. 975 and S. 1079 will help communities respond to the
    impacts of rapidly changing growth patterns that have resulted
    in the abandonment of some communities and over-crowded schools
    and over-burdened infrastructure in others.
        The Community Character Act offers assistance to State and
    tribal governments that have identified a need to update
    planning legislation but lack the capacity to do so.
    Appropriately, S. 975 is not a mandate; rather, it helps State
    and tribal governments cover the costs of incurring public
    participation, developing land use plans, and acquiring
    technology.
        S. 975 will help communities apply smart growth principles
    to future development, including reinvestment in existing
    communities. This committee has already shown great leadership
    on this issue. Senator Chafee, I congratulate you and the
    entire committee on the passage of the Small Business Liability
    Relief and Brownfields Revitalization Act. Smart Growth America
    was one of the first organizations to endorse S. 350, and we
    were delighted to see President Bush sign the final bill into
    law.
        Despite such gains, cleaning up brownfields is only the
    first step to economic recovery, particularly for impoverished
    communities. S. 1079 complements the recently signed
    brownfields law by targeting assistance toward public
    facilities and services, planning, business development, and
    training to help communities reclaim not just their land, but
    also their livelihood.
        Smart growth is about providing better choices for our
    communities and our Nation. Across the Nation, families are
    demanding more convenient and affordable transportation and
    housing options. Communities need tools to handle rapid change,
    and business and civic leaders want greater predictability in
    the development process.
        The Community Character Act and the Brownfield Site
    Redevelopment Assistance Act will help deliver these goals.
    Smart Growth America supports both bills and looks forward to
    working with the committee to see their timely passage.
        Mr. Chairman, Senator Chafee, thank you for the opportunity
    to share the experiences of communities from across the Nation.
    I'm happy to answer any questions.
        Thank you.
        Senator Jeffords. Thank you very much.
        Our next witness is Gary Garczynski, the president of the
    National Association of Home Builders. He is a builder and
    developer in northern Virginia.
        Mr. Garczynski, we appreciate your sharing with us your
    thoughts.

     STATEMENT OF GARY GARCZYNSKI, PRESIDENT, NATIONAL ASSOCIATION
                   OF HOME BUILDERS, WASHINGTON, DC.

        Mr. Garczynski. I hope you'll feel that way when we're
    finished, Senator.
        Senator Jeffords. I'll let you know.
        Mr. Garczynski. Mr. Chairman and Senator Chafee, I, like
    both of you, have been laboring in the vineyards of smart
    growth for the last 4 years as the senior officer with
    oversight over the smart growth initiative and have been a co-
    founder of the Smart Growth Alliance for Metropolitan
    Washington, and am currently working with former Administrator
    of the EPA, Carol Browner, on an Aspen Institute initiative on
    smart growth, so we have been there.
        My remarks today are centered, first of all touching on
    Senator Levin's S. 1079. We feel that what we've reviewed of
    the bill, that NAHB could soon very well be a supporter of that
    initiative, following up with what Senator Chafee did last
    year, although we would have liked to have seen petroleum
    included, we think it is a step in the right direction.
        While we appreciate the efforts of the committee and the
    chair regarding S. 975, NAHB is opposed to the Community
    Character Act. We know that this country is going to grow, and
    we have been working for years on making sure that ``where do
    we grow from here'' is growing smart. There's a demand, no
    matter who you talk to--a demographer, an economist--that there
    is going to be 1.6 million households formed in this country
    continuously over the next decade, and there's really not an
    option of halting growth. It's going to be how is that growth
    molded.
        Unfortunately, we feel the Community Character Act's effort
    to address the short-term pressures of growth is too much of a
    prescriptive intrusion into the local land use process, and for
    that reason, is unacceptable to the home building industry. We
    believe the legislation promotes a top-down approach and
    negates the critical role of a local and a regional approach in
    planning, regulating, and managing land resources.
        Specifically, the act authorizes the Secretary of Commerce
    to make subjective determinations about inadequate or outmoded
    land use planning legislation and areas that are experiencing
    significant growth. Unfortunately, the Secretary is authorized
    to make a subjective judgment in an area where the Secretary
    can claim no special expertise, at least that we see at this
    point.
        We believe strongly that local citizens and local
    governments and regional initiatives are the best arbiters of
    what is an appropriate design for local and regional land use
    plans, and not the intrusion of the Federal Government.
        We are pleased that in S. 975 that you have alluded to a
    balance of affordable housing options, which we think are
    important to any smart growth plan. In particular, the
    provision about the Secretary of Commerce favoring grant
    applications which include approaches to land use planning that
    are consistent with established professional land-use planning
    standards, we believe, gives off the perception, especially in
    criteria No. 6, that the bill could be tied to, from a
    perception basis, to the APA's No. 1 legislative priority, and
    that's its growing smart initiative.
        S. 975 also authorizes grant funding for the use of
    integrating State, regional, tribal, local land use plans with
    Federal land use plans. I think in your opening statements it
    should be the reverse, as you both alluded to. There needs to
    be better coordination from the Federal Government with the
    local agencies, rather than local back to the Federal. Again,
    it is that top-down approach that we are concerned with.
        You know, ultimately we have adopted a policy at the
    National Association of Home Builders that is fundamentally
    opposed to statewide planning and Federal intrusion into the
    process. Our overall experience in facing the challenges of
    ``where do we go from here'' is that that challenge is best met
    by the stakeholders at the local and regional level, and not on
    the State level. I have been hearing for 30 years from the
    Commonwealth of Virginia what Richmond was going to do to help
    northern Virginia. I've yet to evidence any help.
        It is that premise that has led us to our compact with the
    National Association of Counties, working on compacts with the
    National League of Cities and the U.S. Conference of Mayors
    that planning belongs at the local and regional level. For that
    reason, at this time, we could not support S. 975.
        Thank you.
        Senator Jeffords. Thank you for your view.
        Our next and last witness is Mary Lou Bentley. Mary Lou
    Bentley is executive director of the Western Nevada Development
    District in Carson City, NV. She is representing the National
    Association of Development Organizations, which advocates for a
    regional approach to community, economic, and rural
    development.
        Thank you for traveling this great distance in coming to
    share your thoughts with us today.

      STATEMENT OF MARY LOU BENTLEY, EXECUTIVE DIRECTOR, WESTERN
    NEVADA DEVELOPMENT DISTRICT, CARSON CITY, NV, REPRESENTING THE
           NATIONAL ASSOCIATION OF DEVELOPMENT ORGANIZATIONS

        Ms. Bentley. Thank you, Mr. Chairman and members of the
    committee, for the opportunity to testify today. It was an
    interesting trip across our great country yesterday, and I will
    be returning this afternoon.
        I am the executive director of the Western Nevada
    Development District, which is headquartered in Carson City. If
    you're not aware, it is the State capital of Nevada. We
    represent a seven-county region in the very northwest portion
    of the State.
        Incorporated in 1983, WNDD is one of the 325 designated and
    funded economic development districts that Dr. Sampson referred
    to earlier in his testimony. We are, however, a Nevada not-for-
    profit association of local governments, and we are governed by
    a policy board that consists of county and city elected
    officials, along with tribal representatives, business leaders,
    and citizen representatives from our region.
        The National Association of Development Organizations, or
    NADO, provides training, information, and representation for
    regional planning and development organizations that serve over
    82 million people who live in small metropolitan and rural
    America. Founded in 1967 as a public interest group, NADO and
    its members are part of the intergovernmental partnership among
    Federal, State, and local governments.
        Mr. Chairman, NADO strongly supports the goals of the EDA
    brownfields redevelopment legislation for three main reasons.
    First, Mr. Chairman, the EDA program would significantly
    strengthen the current portfolio of Federal brownfield
    programs. While the Environmental Protection Agency has an
    exceptionally effective and very important program, it is
    targeted almost exclusively toward helping urban communities
    assess and cleanup brownfields. The EDA program would establish
    a unique and a far more flexible set of tools to help local
    governments, regional development organizations, and nonprofits
    transform former brownfield sites into productive facilities.
        As highlighted in two recent reports by the NADO Research
    Foundation, there have been a number of impediments
    historically to successful brownfields work in small metro and
    rural areas. These include a lack of local professional staff
    expertise and time, limited project implementation funds,
    liability concerns, and property ownership issues.
        In addition, redevelopment activities are very costly, with
    a typical project costing over $5 million.
        While the recently enacted EPA brownfields legislation
    aggressively addresses many of these impediments, such as the
    liability concerns and funding for assessment and cleanup,
    there is still a significant void in funding for redevelopment
    activities, including planning and technical assistance.
        By establishing the new EDA program, local organizations
    would have potential support for activities that extend beyond
    the traditional cleanup efforts. Local communities could pursue
    strategies for taking previously productive industrial and
    commercial facilities and returning them to viable economic
    centers.
        This, in turn, represents the best of both worlds, creating
    jobs and increasing local revenue, while also raising community
    pride, promoting sustainable development practices, and
    encouraging reinvestment in older areas.
        Second, Mr. Chairman, the EDA brownfields program would
    help regional development organizations and local governments
    incorporate redevelopment efforts into their comprehensive
    economic development strategies. Currently, EDA provides seed
    funding for local communities, predominately through the 325
    economic development districts, to prepare the comprehensive
    strategies that balance the environment and economic growth.
        We believe that the legislation takes the right approach by
    providing supplemental planning assistance, instead of simply
    mandating another requirement in the current planning process.
        It also makes sense to use economic development districts
    for planning and capacity building. This model builds
    professional expertise on a regional basis, instead of working
    individually with cities and counties. The national network of
    districts serves over 2,000 counties and 15,000 small cities
    and townships.
        Third, Mr. Chairman, the proposed legislation would allow
    EDA to continue its successful brownfields redevelopment work
    without depleting its resources that are so desperately needed
    for the infrastructure needs of many of our small communities.
    Since 1997, EDA has invested more than a quarter of a billion
    dollars in over 250 brownfield redevelopment projects
    nationwide. However, we have little reassurance that the Agency
    can sustain this level of investment, especially given the
    existing appropriations and authorization caps.
        By establishing a specific program for brownfields
    redevelopment, the Agency would be given the stability and the
    sustainability required to meet the growing needs of all
    communities, including both urban and rural areas.
        By separating the program, the Agency would also be better
    positioned to assist distressed communities with their very
    pressing needs, whether it is recovering from a natural
    disaster, responding to a plant closing, or expanding existing
    businesses.
        While many of the Nation's urban and suburban areas have
    enjoyed economic prosperity in recent years, there are still
    hundreds of small communities struggling to enter or re-enter
    the economic mainstream. Oftentimes, EDA is the only Federal
    Agency that can truly help these smaller distressed
    communities.
        Over the past 35 years, EDA has developed a very successful
    track record in partnering with other Federal agencies and
    local communities, including regional development
    organizations, to revitalize, upgrade, and expand former
    commercial sites into industrial facilities. This work has
    resulted in the creation of quality jobs and expanded tax base
    for local governments, and a better quality of life for our
    area residents.
        In conclusion, Mr. Chairman, we strongly believe that the
    expanded brownfields program would be a valuable addition to
    the EDA tool box. The legislation would significantly
    strengthen the current portfolio of Federal brownfields
    programs, and it would allow regional development organizations
    and their partners to incorporate brownfield redevelopment
    efforts into the identified projects through the comprehensive
    economic development strategy, and it would allow EDA to
    continue its brownfields work without depleting resources for
    its other job creation programs.
        Mr. Chairman and members of the committee, thank you for
    the opportunity to testify today on behalf of NADO, and I would
    welcome any questions you might have.
        Senator Jeffords. Thank you.
        We thank all of you for very excellent testimony, and some
    disagreement, which is good. That's how we get things done in a
    better and more efficient way.
        I'm going to pick on my good Vermonter first here. Ms.
    Humstone, can you tell me about the polling you have done
    evaluating citizen awareness of sprawl and desire for changing
    those growth patterns? What are the implications of that data?
        Ms. Humstone. Mr. Chairman, we have been doing polling
    since 1998, pretty much on an annual basis, with the University
    of Vermont helping us, and what we've found is the percentage
    of Vermonters who have heard of Sprawl development has
    dramatically increased to well above 70 percent, and,
    interestingly, in the Northeast Kingdom, which, as you know, is
    one of our most under-populated areas and economically
    depressed, that percentage has really leaped during those 3
    years of polling.
        In terms of the need to take action against sprawl, when
    asked that question, ``Do you feel there's a need to take
    action against sprawl,'' we have found very consistently that
    around 60 to 66 percent of Vermonters feel there is need to
    take action against sprawl in our polling.
        In addition, if you look at some of the national polling by
    the American Planning Association, I believe it is around 78
    percent feel that it is important at the Federal level that
    steps be taken to promote smart growth, as well.
        So we feel that there is a strong grassroots support for
    what we are working on in the State, and we also see that in
    our legislature, as well. They've very much supported a
    development cabinet in the Governor's office that would
    coordinate State investments. They also have supported a
    downtown program that would provide incentives for more growth
    downtown and, in addition, have continually supported our
    Vermont Housing Conservation Board, which provides money for
    affordable housing and land conservation, even in very lean
    times. So we see that there is strong support reflected both
    among citizens and the legislature, as well.
        Senator Jeffords. How do you respond to the perception that
    small States like Vermont don't really have any problems with
    sprawl?
        Ms. Humstone. That is a continual problem, and actually
    that's one reason why I wrote the book ``Above and Beyond,''
    because we wanted to show through aerial photography that we
    have problems with sprawl. It is different. It's not going to
    look like Atlanta. It's not going to look like Long Island.
    Rural sprawl tends to be fragmentation of natural resources,
    the breaking up of farmland into large lots, or linear
    commercial development along highways that causes congestion
    and ruins the scenic beauty of our State. When people come to
    Vermont, they come there for the scenic beauty and our
    wonderful small towns, and what we found is that with sprawl
    we're losing the vitality in these small towns and our highways
    are becoming congested and certainly not as pretty as they once
    were.
        Senator Jeffords. Thank you.
        Ms. Anderson, you mentioned in your testimony that higher-
    density housing has often been overlooked. Why do you think
    that is?
        Ms. Anderson. Anecdotally, I can give you information from
    the area that I come from, which is Raleigh-Durham. We have an
    MSA there of well over a million people, and yet there are as
    many as a dozen jurisdictions in which I might be seeking a
    rezoning or an approval for a higher-density project. So, as
    you can imagine, when you take an area of that size and you
    break it down into 10 to 15 local jurisdictions, they are often
    working with land use plans that are maybe the first one
    they've ever had since the beginning of time, or plans that
    need to be updated, plans that need to think ahead.
        As an example, we are trying to have a project of about 60
    units to the acre approved in Durham, NC. We should have known
    this, I suppose, but when we went to submit, we realized that
    their zoning ordinance didn't contemplate any multi-family
    housing in excess of 20 units to the acre. So to propose a
    project at 60 took everyone by surprise, and we spent months
    working with civil engineers, architects, planners to try to
    help the city of Durham draft a new zoning ordinance which
    would include high density.
        So in many instances high density has been overlooked
    because it has never really been contemplated, even in areas
    where I think many of you might say, ``Well, Raleigh-Durham
    surely has high-density housing,'' and, in fact, it does not.
        So I believe this bill could help groups like these smaller
    towns and municipalities create plans that effectively deal
    with high density. Durham specifically tried to travel to other
    cities to see what they were doing in other cities, but there
    are time pressures, and once an application is submitted the
    staff has to respond quickly.
        So we now have an ordinance in Durham that will carry
    capacity for 20, 40, 60, or even 80 units to the acre, but I'm
    confident that those planners need to work on the specifics.
    They were concerned about how to set open space requirements,
    parking limits, setbacks, buffers. All of the minutia that went
    into those higher categories were difficult for them to figure
    out, and our project has been the test case and we'll see how
    it works.
        I think a lot of municipalities just don't have capacity in
    their code for high density.
        Senator Jeffords. We look forward to talking to you again
    to see how it works.
        Ms. Anderson. We do, as well. Thanks.
        Senator Jeffords. Mr. Chen, many people have suggested that
    smart growth and affordable housing are mutually exclusive.
    Have you found that to be the case?
        Mr. Chen. No, we have not found that to be the case. If you
    look at the membership of our coalition, I think you will see
    that there are a great number of people who advocate for smart
    growth and affordable housing all working together.
        This is actually an issue that has generated a great deal
    of heat, and that's why I was so pleased to see the Brookings
    Institution produce a report just last month that shed some
    light on the issue.
        For starters, the Brookings Institution looked only at the
    academically juried research on this question of whether or not
    growth management affects affordable housing, and they found
    that overwhelmingly, the major factor that affects housing
    prices is the market--in other words, market demand. If you
    have a hot housing market, then prices will go up.
        They found that growth management measures such as zoning
    and planning and others tend to have a very small impact, if
    any, on housing prices. In fact, they looked specifically at
    Oregon, at a number of studies there, and found that the
    increase of jobs and economic activity in the Portland area, in
    particular, tended to raise housing prices in that area, and
    that the urban growth boundary, did not have such an impact.
        The study also concluded that, based on the research that's
    out there, the current system of sprawl development does not
    serve our purposes very well when it comes to affordable
    housing. It tends to lead to exclusionary housing measures and
    generally a very low supply of affordable housing.
        The report's authors do argue that, in fact, well-
    maintained, good growth management strategies can, in fact,
    increase affordable housing production, and particularly if
    measures such as Montgomery County's inclusionary housing
    measure are implemented.
        Senator Jeffords. With Federal, State, and local
    governments facing tight budgets, is small [sic] growth really
    an area that we should be venturing into right now?
        Mr. Chen. Well, that's a great question. Smart growth, as
    you may have heard from the couple of examples that I've
    mentioned, is about the efficient use of natural and economic
    resources. In Utah, for example, we saw a savings of $4.6
    billion in infrastructure costs. Thanks to the scenario
    planning that they've conducted down there, in Atlanta we see a
    reduction in traffic and accompanying problems.
        What is interesting about smart growth is that not only is
    it very important to conserve these resources, but I think that
    communities are really calling for tools that they can use to
    more efficiently use their resources. The Community Character
    Act certainly does that.
        I also think that at this time, when we are in an economic
    recession, we especially need economic stimulation of the right
    kind, and, in particular, the brownfields bill that we are
    discussing today offers that type of assistance.
        Senator Jeffords. Mr. Garczyinski, do you believe that the
    Federal role in land use planning is any greater in these bills
    than the numerous tax credits, developer incentives, and
    Federal grant programs already in existence that aid current
    development patterns?
        Mr. Garczynski. I think typically the restrictions in
    Federal housing programs are imposed on builders through
    insurance requirements or financing requirements and
    regulations, but here you're getting into the very fundamental
    question of land use policy, so that's where I think the
    difference comes.
        Senator Jeffords. Mary Lou, I am interested in hearing more
    about the challenges you face in coordinating economic
    development among the seven counties. What is your biggest
    challenge? What tool or resources besides funding, which we
    always know is one without asking, would make your job easier?
        Ms. Bentley. Oh, my. Am I still limited to 5 minutes, Mr.
    Chairman?
        In our case in Nevada, we have not been directly, as an
    organization, involved in a brownfields project for several
    reasons. One, as I stated earlier in my testimony, we are
    organized as a Nevada not-for-profit association. We are not a
    501(C)(3), and there is no State legislation that recognizes or
    grants our organization any particular standing. We are there
    because our members see some benefit to having us there, and we
    are there because we are a designated EDA planning district.
        Because we don't have that kind of legal standing and
    because we are not a 501(C)(3), we have not been able to get
    into the EPA assessment program. One of our communities, our
    board endorsed their application, and through the State of
    Nevada they completed an assessment of a particular site that
    they are dealing with right now. Legislation that would move
    this into the EDA arena and would recognize the economic
    development districts would allow our board then to take a look
    at brownfields on a regional basis, without having to change
    the legal status of the organization or change any legislation
    at our State level that might be something they might regret
    later.
        Senator Jeffords. Senator Chafee.
        Senator Chafee. Thank you, Mr. Chairman.
        I second your motion that it is good to have dissenting
    views. That's why we have hearings.
        Hopefully we can improve the bills to meet some of your
    criticisms and hopefully get your endorsement. I'm sure you
    have been at public hearings, as I have, both kinds--those that
    last until 1 o'clock or 2 o'clock in the morning by all the
    angry neighbors out there ranting and raving until the wee
    hours opposed to a project, whether it's the density or just
    compatibility to their neighborhood, and then also been at
    public hearings where there's one or two people carefully
    looking at the plans and silently walking out of the room. I
    think the difference there is that if there is a master plan
    bought into by everybody, then when the projects come forward
    that do concur with the plan then there's not a lot of
    controversy, whether it is the density or the landscape design.
        Senator Jeffords. Goodbye.
        Senator Chafee [assuming chair]. Thank you. Very good
    questions. Thank you.
        It is a lot easier for both the developer and the
    neighborhood to see growth in a community, and, as Mr. Chen
    said, we want it to be smart growth, and that's the object also
    with the Community Character Act. Whether it is Vermont, just a
    rural area that's seeing growth, or whether, as I mentioned,
    some of the western States that are just seeing enormous growth
    and how it is planned, and so when the developer does come
    forward there are some parameters that everybody is agreed to
    in a planning process, and the developer knows that the next
    fellow that comes 2 weeks later is going to have to conform
    with those parameters, and it is much easier for them.
        I have been at both kinds of hearings, and I can say it's a
    lot easier to have the 45-minute hearing with not a lot of
    raised voices and not the officials, whether it is on the
    zoning board or the city council or whatever it might be,
    perspiring in front of their angry constituents.
        I would just look forward to working with you on that bill
    and hopefully get your endorsement. I think Senator Jeffords
    had some good questions, and I appreciate your testimony and
    look forward to working with you and hopefully get a bill that
    will get everybody's approval and pass the Senate and the House
    and get the President's signature on both bills.
        Thank you very much.
        I guess I have the gavel, so I'm going to tape it. Thank
    you.
        [Whereupon, at 11 a.m., the committee was adjourned, to
    reconvene at the call of the chair.
        [Additional statements submitted for the record follow:]
      Statement of Senator Ben Nighthorse Campbell, U.S. Senator from the
                               State of Colorado
        Thank you Mr. Chairman.
        As we know, Brownfields are an ongoing concern in this country and
    specifically in my home State of Colorado. So far, this program has
    been very successful in its goal of revitalizing abandoned, idled, or
    under-used industrial and commercial facilities.
        While these areas pose a low public health risk, they are often
    avoided by developers because of cleanup costs and potential liability.
    This designation has expanded as Superfund has, for the most part,
    already cleaned up the worst hazardous waste sites in the Nation.
        The Brownfields program is instrumental in achieving the goal of
    cleaning up these less-hazardous areas by relieving the liability
    burdens on contiguous property owners, prospective purchasers, and
    innocent landowners. This is of increasing importance as cities expand
    into these former industrial areas. My home State of Colorado is home
    to Denver's Jefferson County, currently the third-largest growing in
    the Nation. It is vital that we make these lands usable by reducing
    potential health-risks to our citizens.
        In fact, the city of Denver was recently named a Brownfield
    Showcase Community. These Brownfield Showcase Communities have three
    main goals:
        1. To promote environmental protection, economic redevelopment, and
    community revitalization through the assessment, cleanup, and
    sustainable reuse of Brownfields.
        2. To link Federal, State, local and non-governmental action
    supporting community efforts to restore and reuse Brownfields.
        3. To develop national models demonstrating the positive results of
    public and private collaboration addressing Brownfield challenges.
        I look forward to working with my colleague, Senator Levin, on this
    bill (S. 1079), which addresses issues affecting our nation's
    communities and seeks to aid their efforts to revamp abandoned
    Brownfield sites by providing new incentives and needed reform to
    expedite the process of mending these properties, especially since
    Denver has an estimated 100 Brownfield sites.
        Now that there is a new administration and a fresh outlook on our
    environment and natural resources, I look forward to working with all
    of the interested parties to form a consensus on this issue.
        It is of great importance that we provide the necessary relief to
    the many cities faced with the cleanup of Brownfields, and empower
    States to assist in shepherding the cleanup effort.
        Thank you Mr. Chairman.
                                   __________
        Statement of David A. Sampson, Assistant Secretary for Economic
                    Development, U.S. Department of Commerce
        Chairman Jeffords, Senator Smith, members of the committee:
        Thank you for this opportunity to appear before the Environment and
    Public Works Committee regarding the Economic Development
    Administration's role supporting brownfields revitalization and
    development planning.
        The Administration, the Department of Commerce (DOC), and the
    Economic Development Administration (EDA) recognize the need for
    brownfield revitalization and strategic land-use planning objectives
    that are the focus of S. 1079, the Brownfield Site Redevelopment
    Assistance Act and S. 975, the Community Character Act of 2001. EDA has
    an established record of working with local stakeholders to redevelop
    and reuse brownfields and has partnered with the Environmental
    Protection Agency (EPA) to provide assistance similar to what is
    outlined in these bills. The President has announced that his fiscal
    year 2003 budget will double the funds available through EPA in fiscal
    year 2002 from $98 million to $200 million--to help States and
    communities around the country cleanup and revitalize brownfield sites.
    However, given the demands on the Federal budget to fight the war on
    terrorism and safeguard our national and homeland security, the
    Administration cannot support the additional funding beyond the
    increased funding already in the President's budget.
        In addition, brownfield redevelopment and land use planning must be
    addressed through community-driven, market-based approaches instead of
    a centralized approach. We must focus our efforts on leveraging
    existing resources and authorities at the Federal, State, and local
    levels to support market-based solutions.
        In the economic development arena, free markets, community
    organizations, private industry, and local governments are the drivers
    of successful long-term economic opportunity. It is the private sector
    that has the financial resources necessary to revitalize our
    communities and create jobs and wealth in America. Therefore, it is the
    Federal Government's role to create an environment that allows local
    governments to partner with private industry by encouraging market-
    based solutions that attract private sector investment to revitalize
    America's communities.
        This strategy lies at the heart of EDA's mission to help our
    partners across the Nation create wealth and minimize poverty by
    promoting a favorable business environment to attract private capital
    investment and create higher-skill, higher-wage jobs. This approach is
    consistent with the Administration's vision that government should be
    active, but limited; engaged, but not overbearing. Government has a
    role to play in brownfields redevelopment and strategic economic
    development planning by creating an environment where private sector
    solutions can be realized.
        Successful regions build on their inherited assets such as
    geography, climate, population, research centers, companies,
    governmental organizations, to create specialized economies that both
    differ from other regions and offer comparative advantages to local
    companies.
            history of eda/doc brownfields redevelopment assistance
        The Economic Development Administration (EDA) has a longstanding
    role in supporting the economic redevelopment of abandoned, idled, and
    contaminated industrial and commercial sites. Since 1997, EDA has
    invested over a quarter of a billion dollars in more than 250
    brownfield redevelopment projects. Last year alone, EDA invested $55
    million in 58 brownfield projects, that is close to the level
    authorized in S. 1079.
        EDA's flexible economic development program tools have assisted
    local governments, nonprofit organizations, and regional Economic
    Development Districts in overcoming their brownfields revitalization
    challenges. Under existing statutory authority, EDA provides assistance
    to brownfields-impacted communities designed to achieve long-term
    economic revitalization. In assisting with brownfields redevelopment
    activities, EDA has used a variety of different program tools to
    address various phases of brownfields redevelopment, including:
         Providing targeted planning and technical assistance
    investments to support market feasibility studies and geographic
    information system (GIS) inventories of brownfields;
         Assisting communities with infrastructure investments to
    rehabilitate land and buildings, attract private capital investment
    that in turn creates jobs; and
         Making investments to capitalize local revolving loan
    funds used to provide gap financing in support of local business
    development.
        In my brief tenure at the helm of EDA, I have visited several
    brownfield sites and have viewed first hand the powerful economic
    transformation that can occur when previously constrained market forces
    are unleashed. For example, at the former Fitzsimons Army Medical
    Center in Denver, Colorado, a BRAC closure and brownfield site, EDA has
    invested $9.4 million to replace the 4,000 jobs and $192 million in
    annual expenditures lost to the Aurora community.
        The site is currently being transformed into a new employment
    center with 25,000 jobs anchored by a new medical campus for the
    University of Colorado and a 160-acre bioscience research and
    development park. The bioscience research and development park is the
    first of its kind west of the Mississippi. The new work force already
    exceeds 2,000 people, with a projected full replacement of jobs lost by
    2004.
        More than $500 million in construction is completed or underway,
    and ten biotechnology companies have already located at Fitzsimons.
    Major private investments include a $55 million gift for a clinical
    complex and $18 million in venture capital for the largest biotech
    company located in the business incubator on the site. Total private
    investment to date is estimated to be well over $100 million.
        EDA has been a longtime supporter of the Environmental Protection
    Agency's (EPA) Brownfields Initiative and was the first Federal agency
    to enter into a partnership agreement with EPA--signing a memorandum of
    understanding (MOU) in 1995.
        Pursuant to this partnership, EPA funds a Brownfields Coordinator
    position in EDA headquarters to enhance communication and coordination
    among the two agencies, and our prospective applicant beneficiaries.
    This unprecedented level of cooperation between two Federal agencies,
    with markedly different missions, has established a new model for
    intergovernmental collaboration and effective delivery of assistance to
    local communities.
        Another part of the Department of Commerce, the National Oceanic
    and Atmospheric Administration (NOAA), has also been involved in the
    cleanup and redevelopment of brownfield sites. NOAA is the Nation's
    primary coastal steward and the Agency has worked to improve our
    Nation's coastal areas and resources in a number of areas. NOAA
    programs are working at coastal brownfield sites to sponsor local
    workshops focusing on brownfields restoration; revitalizing waterfronts
    and redeveloping sites through effective coastal zone management; and
    providing advice to communities on cleaning up and restoring
    contaminated coastal areas. For example, NOAA is sponsoring a
    Brownfields Showcase Community coordinator for the city of New Bedford,
    MA to work on the joint EPA and NOAA issues. This coordinator is
    assisting the local brownfields task force in cleaning up and restoring
    brownfields sites in the city. NOAA works with a number of other local
    communities to deliver tools and services that promote effective local
    decisionmaking to revitalize local economies and communities. EDA and
    NOAA are looking at ways to enhance what our two agencies, as part of
    DOC, can bring to these communities.
        Despite these efforts, we recognize the need for a more
    comprehensive approach to dealing with brownfields redevelopment across
    the Nation. Toward this end, the Department of Commerce and the
    Environmental Protection Agency are drafting a memorandum of
    understanding that empowers all DOC bureaus to partner with EPA to
    comprehensively address brownfields redevelopment. This partnership
    would allow DOC and EPA to provide additional assistance to
    brownfields-impacted communities across the country.
                 current challenges in brownfield redevelopment
        As the President stated upon signing EPA's landmark brownfields
    legislation in January, we believe the key to effectively and
    efficiently addressing the brownfields development challenges facing
    our nation's communities is for the Federal Government to pursue a more
    cooperative common sense approach. This brownfields legislation was
    passed with the support from both Republicans and Democrats. Notably,
    the legislation recognizes and supports State efforts directed at
    regulatory relief and market-based incentives for redevelopment.
        An example of an effective market-based incentive that we strongly
    support, not included in EPA's legislation, is the brownfields tax
    incentive. This incentive allows for environmental cleanup costs to be
    fully deducted in the year they are incurred, rather than being
    amortized and depreciated over the life of the property. Under current
    law, favorable tax treatment for the contamination cleanup costs will
    expire at the end of 2003. As proposed in the President's fiscal year
    2003 budget, the Administration believes that the brownfields tax
    incentive should be made permanent. According to government estimates,
    the $300 million annual investment in the brownfields tax incentive
    will leverage approximately $2 billion in private investment and return
    4,000 brownfields to productive use.
        The Administration believes brownfields redevelopment is about
    reclaiming land and returning it to productive use by encouraging
    private sector investments that will create jobs, rejuvenate local tax
    roles, and support sustainable use of restored natural resources.
    Public policy in this area should focus on incentives to encourage
    entrepreneurs and developers to invest in and revitalize brownfields
    sites. Furthermore, it is essential that we engage in collaborative
    partnerships and leverage funding through existing programs to provide
    assistance to brownfields-impacted communities.
        Given the scope and complexity of brownfields throughout the United
    States, one program, agency, or organization is not able to adequately
    address the multitude of issues involved in brownfields redevelopment.
    Therefore, the best approach to address this complex problem is through
    an enhanced coordination between Federal agencies and leveraging
    existing assets at the Federal, State, and local levels which create an
    environment that attracts private sector investment. The collaboration
    of all parties will result in the redevelopment of brownfields, new
    jobs and a cleaner environment.
        An example of Federal agencies coordinating their efforts and
    assets is the national Brownfields Showcase Communities Initiative that
    has provided technical assistance and resources from more than 20
    Federal agencies to selected communities grappling with brownfields
    issues.
    addressing the brownfield site redevelopment assistance act of 2001 (s.
                                     1079)
        S. 1079 recognizes EDA's historic role in supporting national
    brownfields revitalization efforts through planning, technical
    assistance, infrastructure construction, and revolving loan fund
    development tools. With EPA focused on the front-end assessment and
    cleanup of brownfields, and EDA focused on the back-end redevelopment
    and revitalization of sites, we believe this model partnership is the
    proper vehicle to address the nation's brownfields challenges.
    Recognizing the success of this partnership, EDA and NOAA will work to
    strengthen collaboration with EPA and other partners on the
    revitalization of brownfields-impacted areas.
        While there are many parallels between this legislation and EDA's
    current efforts to support brownfields revitalization activities,
    portions of this bill represent a broad departure from EDA's mission.
    For example, the legislation calls for EDA to ``create parks,
    playgrounds, and recreational facilities.'' This type of development
    falls outside of EDA's principle mission as authorized by Congress.
        Finally, we are concerned that S. 1079 calls for resources that are
    not included in the President's budget. We believe that the objectives
    of this legislation can be best attained within current budgetary
    resources through improved coordination of existing programs, a market-
    based tax incentive approach, and a locally driven development process
    where community and business leaders come together to address economic
    and environmental needs.
                  the community character act of 2001 (s. 975)
        The committee has also asked me to comment on the Community
    Character Act. In recent years, concerns have been raised regarding the
    kinds of development occurring in America's suburban communities.
    Concern exists that development is occurring in a way that detracts
    from quality of life as characterized by traffic congestion, air and
    water pollution, and unfocused and unattractive development.
        This problem is addressed through local community planning with a
    focus on investments that look beyond the immediate economic horizon
    and anticipate economic changes in the local regional economy and
    embrace market-based rigorous development standards.
                 history of eda/doc support for local planning
        Comprehensive market-based local and regional planning is an
    essential component of successful economic development. Effective
    planning creates a road map for communities to grow and develop with a
    focused approach toward creating higher-skill, higher-wage jobs.
        For almost 40 years, economic development planning has been a
    cornerstone of EDA's development programs. During this time EDA has
    found that effective economic development planning is accomplished at
    the local level. Other than special circumstances such as coastal zone
    management planning, as a general rule, States are too far removed from
    local history, background, and circumstances involving land use
    planning to reasonably find solutions to what are frequently unique
    local circumstances. Local stakeholders are best able to effectively
    identify and analyze local problems and opportunities, and implement
    the vision of the community.
        EDA is currently involved in and committed to local planning
    through its Partnership Planning program, which supports 325 multi-
    county Economic Development Districts and 59 American Indian tribes and
    Alaska Native villages. Since 1997, EDA has provided planning
    activities matching the level of funding that would be provided through
    the Community Character Act. Last year alone, EDA provided over $18
    million to Economic Development Districts and more than $2.5 million to
    American Indian tribes through the Partnership Planning program. This
    program provided approximately $100 million in assistance to support
    regional development. Last year, EDA made 49 short term planning
    investments totaling almost $3 million; 26 of these investments were to
    regional planning districts, 14 to urban areas, and 9 directly to
    States.
        This process supports local planning by encouraging development of
    a regional comprehensive economic development strategy (CEDS). The CEDS
    process is designed to guide the economic growth of an area through an
    inclusive and dynamic process that coordinates the efforts of community
    organizations, local governments, and private industry concerned with
    economic development.
        While our CEDS process is a prerequisite for EDA infrastructure
    construction assistance, its greater value to communities is the
    development of a strategic vision as well as a capacity-building
    program. While not prescriptive, local communities developing CEDS are
    encouraged to address economic issues and opportunities in a manner
    that promotes economic development, fosters effective transportation
    access, enhances and protects the environment, and balances resources
    through sound management.
        Fundamental to the success of the CEDS process is that regional
    strategies are market-based and recognize that each community or region
    must craft an economic development plan that focuses on its unique
    strengths. These local strategies then translate into a holistic
    approach to local land use planning by considering multiple issues of
    concern by community stakeholders, including job creation,
    environmental protection, transportation options, and public works
    investments, among others.
        In addition, NOAA, under its Coastal Zone Management Act
    responsibilities, has a 30-year history of working with coastal States
    to support effective local planning. Coastal zone management plans
    provide a framework for successful economic development and the
    maintenance of environmental quality at the State and local level.
    Thirty-three coastal States and territories, covering 99 percent of our
    Nation's ocean and Great Lakes coasts, have approved coastal zone
    management plans.
            addressing the community character act of 2001 (s. 975)
        The Community of Character Act proposes new funding to establish a
    grant program to promote comprehensive land use planning at the State,
    tribal, and local levels. The bill would authorize $25 million each
    year, for 5 years at the State level for planning activities. The
    Administration cannot support S. 975 because it calls for resources
    that are not included in the President's budget to support activities
    that can be accomplished through existing authorities and
    appropriations, and a centralized approach to land use planning is not
    the most effective solution to address issues of sprawl and unfocused
    economic development.
        Rigorous development standards in land use planning, which are
    market-based, locally defined, and focused beyond the immediate
    economic horizon, are good business. While quality of life issues
    surrounding poor land use planning in America's suburbs are a growing
    concern, the most effective approach to land use planning is to create
    a locally devised plan that is market-based in its focus.
        EDA's experience has proven local planning efforts work. As I
    stated earlier in my testimony, EDA's planning grants require the
    participation of local economic development stakeholders including
    community organizations, local governments, and private industry.
    Ultimately, this process must involve leveraging public, private and
    community resources, to achieve a commonly held vision for the
    community. This approach will allow for different local planning views
    to be considered, resulting in market-based planning that is flexible
    enough to accommodate innovation.
        This market-based approach is currently addressing the concerns
    about sprawl throughout the country. Developers are using cutting-edge
    designs that mitigate the unpleasant aspects of sprawl, while
    satisfying citizens' demands for clean and convenient communities.
    Markets are naturally driving developers toward high-end development
    standards demanded by consumer interest in development designs that
    reflect their desire for pleasing aesthetic environments, convenience,
    safety, and affordability. In the end, a market is more than a place;
    it is a process.
        EDA, for example, has been actively involved in supporting eco-
    industrial development as a preferred redevelopment technique for
    brownfields impacted areas and has supported many of the nation's early
    efforts in this regard. Eco-industrial development emphasizes
    synergistic corporate relationships and closed loop industrial systems,
    where the waste product of one industry is used as input for another.
    Eco-industrial development takes many forms, but the overarching goal
    is to catalyze local economic growth through cost saving, performance
    based long-term development approaches. Fundamental to this concept is
    the use of high-end development standards.
        There are several innovative approaches in the marketplace
    addressing eco-industrial development. For example, The Londonderry,
    New Hampshire Ecological Industrial Park is a successful example of the
    eco-industrial concept. The anchor tenant for this industrial park is a
    720 mega-watt combined cycle natural gas power plant that will use
    treated wastewater from the neighboring city of Manchester for cooling
    as part of a closed-loop industrial system. The industrial park is
    located adjacent to several residential areas and was developed through
    a market-based local planning process that included government,
    private-sector, and community participants. As such, the park includes
    100 acres of permanently protected open space and other aesthetic
    amenities providing value added benefits to tenants and the surrounding
    community.
        Another innovation in the marketplace is the emergence of
    environmentally sensitive development. This emerging market niche
    marries real estate development with natural and rural amenities.
    Typically, some portion of these ``eco-developments,'' as they are
    known, is set aside as community space while the remainder is divided
    up for commercial and residential uses. An example of this kind of
    development is Prairie Crossing in Grayslake, Illinois located between
    Chicago and Milwaukee. This development incorporates agricultural
    production and open space preservation in a model that allows
    developers to realize returns in the top quartile of the area real
    estate market. Development in Prairie Crossing is holistically
    integrated with the natural environment including 150 acres of
    agricultural land and community gardens; 228 acres of lakes, wetlands,
    meadows, and prairies; and 15 miles of hiking trails.
                                   conclusion
        This Administration will continue to work for the American people
    to protect the quality of our air, land, and water, while building on
    the premise that environmental protection and economic prosperity go
    hand in hand. It is important to provide flexibility to States and
    local communities to craft solutions that address their unique
    situations. Further, legal obstacles to clean up brownfields should be
    removed, brownfield tax incentives made permanent, and Federal
    financial assistance made more effective by cutting red tape.
    Brownfields cleanup, restoration, and redevelopment are important
    because they revitalize communities by improving public health and
    environmental conditions, boosting local property tax rolls, and
    creating jobs.
        In all aspects of its development and implementation, economic
    development must be addressed at the local level if it is to be
    successful in its objectives of creating wealth and minimizing poverty
    by promoting a favorable business environment to attract private
    capital investment and job opportunities.
        By working together with State and local communities, leveraging
    the Federal Government's current resources, and coordinating the
    efforts among agencies, we can work effectively to create a market-
    based approach to develop and revitalize communities across the Nation.
        Thank you for allowing me to testify before you today. I would be
    pleased to answer any questions that you may have.
                                     ______

        Responses by David Sampson to Additional Questions from Senator
                                    Jeffords
        Question 1. In the past, EDA identified brownfields, and
    Environmental Protection Agency (EPA) designated Brownfields Assessment
    Pilots in particular, as strategic funding priorities in the agency's
    Notice of Funding Availability (NOFA). I note this year, that
    brownfields redevelopment is no longer listed as a funding priority.
    Can you tell me why? Without brownfields redevelopment as a specific
    priority, how does EDA plan to maintain its commitment to work with
    communities, States and other Federal agencies on brownfields
    redevelopment?
        Response. Each year EDA establishes its investment priorities in
    the Notice of Funding Availability (NOFA) based on a variety of
    factors, including the exigencies of the nation's contemporary economic
    conditions; the emergence of new effective models to address poverty
    and economic distress; and Administration policy priorities. For
    example, EDA's fiscal year (FY) 2002 NOFA prioritizes investments that
    assist communities in developing and implementing economic adjustment
    strategies in response to sudden and severe economic dislocations. Such
    economic adjustment strategies leverage regional assets and support
    community and faith-based social entrepreneurship.
        Brownfields redevelopment remains a top priority of EDA and the
    Administration. In EDA's fiscal year 2002 NOFA, we highlight
    brownfields redevelopment together with technology-led development, and
    eco-industrial development as one of three principal investment types
    the Agency is interested in under its Public Works and Economic
    Development Facilities Assistance program. Brownfields transactions, in
    fact, have always been encouraged because from an economic efficiency
    standpoint they take advantage of readily available infrastructure and
    markets.
        The EDA has a longstanding role in supporting the economic
    redevelopment of abandoned, idled, and contaminated industrial and
    commercial sites. Since 1997, EDA has invested over a quarter of a
    billion dollars in more than 250 brownfield redevelopment projects.
    Last year alone, EDA invested $55 million in 58 brownfield projects,
    that is close to the level authorized in S. 1079. Furthermore, EDA has
    been a longtime supporter of the Environmental Protection Agency's
    (EPA) Brownfields Initiative and was the first Federal agency to enter
    into a partnership agreement with EPA--signing a memorandum of
    understanding (MOU) in 1995.
        Pursuant to this partnership, EPA funds a Brownfields Coordinator
    position in EDA headquarters to enhance communication and coordination
    among the two agencies, and our prospective applicant beneficiaries.
    This unprecedented level of cooperation between two Federal agencies,
    with markedly different missions, has established a new model for
    intergovernmental collaboration and effective delivery of assistance to
    local communities.

        Question 2. The objective of S. 1079 is to ensure that EDA is able
    to help communities promote brownfields redevelopment and economic
    revitalization and to improve coordination. It also allows a greater
    number of community partners such as universities, non-profit
    organizations, and regional councils, help spur revitalization. Funding
    issues aside, would this authority help EDA work with communities on
    brownfields redevelopment and job creation?
        Response. Through its existing statutory authority and
    appropriations, EDA currently has the ability and resources necessary
    to support national brownfields revitalization activities including
    community partners such as universities, non-profit organizations, and
    regional councils. In fulfilling its mission, EDA is guided by the
    basic principle that local communities must be the drivers of their own
    economic development and revitalization strategies. Based on these
    locally and regionally developed strategies, EDA responds to local
    economic development needs that are consistent with the agency's
    statutory requirements and established investment priorities. Under
    EDA's highly responsive investment strategy, the Agency has naturally
    been funding more brownfields revitalization activities as national
    needs have increased. Since EDA already has the necessary flexibility
    in its authorization to address Brownfields requirements, new
    authorities in separate legislation would be redundant.

        Question 3. EDA's NOFA this year includes seven new investment
    criteria. How do you think these new investment criteria will influence
    funding of brownfield projects at EDA? In what ways will the use of
    these criteria impact the selection of the kinds of brownfield projects
    that EDA has historically funded? I am concerned that many brownfields
    are located in poor market areas and therefore these new criteria may
    be a barrier to brownfields redevelopment. Do you anticipate a change
    in the number of projects that will be funded, relative to previous
    years, as a result of the use of these new criteria?
        Response. Application of the guidelines will lead investment
    decisions to be based on outcomes such as value-added employment and
    private sector investment. The investment criteria will ensure that
    those brownfields redevelopment projects selected for funding will have
    a higher likelihood of success and provide a greater return on taxpayer
    investment. EDA does not anticipate a significant change in the number
    of brownfields projects that will be funded this fiscal year relative
    to recent years; however, because EDA investments are based on locally
    driven needs, the number and aggregate amount of funding does vary from
    year to year. During the period from fiscal year 1997 through 2001 EDA
    funded a high of 78 projects totaling $79 million (1998) and a low of
    31 projects totaling $35 million (1997). We expect that future EDA
    investments will fall within this range. Furthermore, we believe that
    in conjunction with the resources requested in the President's fiscal
    year 2003 Budget for the EPA, and as a result of developers ability to
    continue taking advantage of the Brownfields Tax Incentive through
    fiscal year 2003, that EDA will be able to identify numerous
    prospective brownfields investments that meet the Agency's new
    investment criteria.

        Question 4. Could you please provide an example from EDA's current
    brownfields projects that you believe meets these new investment
    criteria, and an example of a project that you feel does not,
    explaining why in both instances.
        Response. The redevelopment of the Fitzsimons Army Medical Center
    is an example of a project that meets EDA's Investment Policy
    Guidelines. At this BRAC closure and brownfield site, EDA has invested
    $9.4 million to replace the 4,000 jobs and $192 million in annual
    expenditures lost to the Aurora community. The site is currently being
    transformed into a new employment center with 25,000 jobs anchored by a
    new medical campus for the University of Colorado and a 160-acre
    bioscience research and development park. The new work force already
    exceeds 2,000 people, with a projected full replacement of lost jobs
    lost by 2004. More than $500 million in construction is completed or
    underway, and ten biotechnology companies have already located at
    Fitzsimons. Major private investments include a $55 million gift for a
    clinical complex and $18 million in venture capital for the largest
    biotech company located in the business incubator on the site. Total
    private investment to date is estimated to be well over $100 million.
        An early EDA brownfield redevelopment investment that meets EDA's
    Investment Policy Guidelines is the Cornerstone Partnership Project in
    Wellston, Missouri. Many of the community's WWII-era employers left a
    legacy of environmental contamination from their former industrial
    activities including significant levels of PCBs. EDA investments in
    Wellston began in 1984, and have totaled over $8.9 million for
    infrastructure and rehabilitation of an existing building to create the
    Advanced Metals Technology Training center. A principal goal of the
    training center is to assist 5,000 displaced defense workers and 600
    defense contractors in transitioning from jobs supporting defense
    functions to jobs in global commerce. Since inception in 1998 over 500
    students have enrolled and the average placement wage of all graduates
    is $10.77 per hour. In 2000, there were 87 placements at an average
    wage of $11.51 per hour.
        While it is likely that EDA has made past brownfields redevelopment
    investments that would not have been selected under EDA's Investment
    Policy Guidelines, the majority of past investments would likely
    qualify under the guidelines. However, generally EDA is not interested
    in funding projects that lack solid market fundamentals and have
    limited likelihood of supporting the future growth of the regional
    economy. This would include speculative projects with no clear plan for
    future development or very long development lead times. As a general
    rule, EDA is also not interested in funding projects that have a
    minimal impact on securing jobs and leveraging private investment or
    have undefined purposes. I believe such cleanup activities are most
    appropriately handled by State and Federal agencies with this
    responsibility.

        Question 5. You expressed concern about the S. 1079 provision to
    provide funding for publicly owned parks or cultural centers. Healthy
    economies need healthy communities and public facilities are an
    important component for spurring reinvestment in distressed
    communities. Studies show that public facilities and green space in
    urban areas can serve as a catalyst for economic development as
    businesses like to provide these amenities to workers. In the past, I
    believe that EDA has funded these types of public facilities. Why do
    you feel it is inconsistent with the Agency's effort to encourage
    economic investment?
        Response. As noted previously, EDA's authorizing legislation and
    mission is to invest in projects that create jobs and attract private
    investment. Such projects provide a high return on taxpayer investment.
    Without question, publicly owned parks and cultural centers encourage
    reinvestment in economically disadvantaged areas. As a general rule,
    however, these types of activities do not provide for the long-term,
    higher skill, higher wage jobs that EDA seeks to encourage with its
    limited capital pool. Creation of parks and recreational facilities is
    best left to the purview of State and local governments and other
    Federal agencies that are more suited to advancing and overseeing this
    kind of activity.

        Question 6. In your testimony, you note the fiscal constraints on
    the Federal Government. However, you also speak of the tremendous
    return on investment from brownfields redevelopment. Don't you agree
    that examples, like the former Fitzsimons Army Medical Center in
    Denver, make a compelling case for Federal investment in brownfields
    redevelopment?
        Response. The revitalization of Fitzsimons Army Medical Center is
    an excellent example of the role that the Federal Government can play
    in supporting brownfields redevelopment. Moreover, the Fitzsimons Army
    Medical Center is an example of the type of project that EDA would look
    to fund out of our existing program resources in the future. It is a
    market-based investment that capitalized on the regions existing
    regional infrastructure to build comparative advantages for future
    business investment. EDA's $9.4 million investment in the facility
    advanced innovation and productivity by transforming the facility into
    a new employment center with 25,000 jobs.
        Fitzsimons is anchored by a new medical campus for the University
    of Colorado and a 160-acre bioscience research and development park as
    a part of a long term regional strategy that has resulted in ten
    biotechnology companies that have already located at Fitzsimons. This
    strategy, developed by a concerted effort of local officials, has
    resulted in a new work force that already exceeds 2,000 people, with a
    projected full replacement of lost jobs lost by 2004. Furthermore, this
    project is maximizing the return on taxpayer investment by stimulating
    $500 million in construction that is completed or underway. Major
    private investments include a $55 million gift for a clinical complex
    and $18 million in venture capital for the largest biotech company
    located in the business incubator on the site. Total private investment
    to date is estimated to be well over $100 million. This will result in
    the replacement of $192 million in annual expenditures lost to the
    Aurora community by the base closure.
        As I stated in my testimony, brownfields redevelopment remains a
    top priority of EDA and the Administration. We highlight brownfields
    redevelopment in our fiscal year 2002 NOFA as one of three principal
    investment types the Agency is interested in under its Public Works and
    Economic Development Facilities Assistance program. Last year alone,
    EDA invested $55 million in 58 brownfield projects and look to continue
    funding competitive proposals that redevelop abandoned, idled, and
    contaminated industrial and commercial sites. Finally, EPA will look to
    enhance our coordination with the EPA through a more comprehensive MOU
    to leverage the resources of both agencies more effectivley.

        Question 7. Please tell me about the success of tools such as
    market feasibility studies and geographic information system (GIS)
    inventories.
        Response. Geographic Information System: In addition to the
    infrastructure investments that EDA commonly makes in support of local
    brownfields redevelopment efforts, many communities have found that
    EDA's economic adjustment, planning and technical assistance programs
    can be effectively leveraged to support their redevelopment efforts
    using tools such as market feasibility studies and geographic
    information system (GIS) inventories. Many communities, for example,
    have used EDA planning grants to support the development of local or
    regional GIS inventories of idled, abandoned, or under-used industrial
    sites (i.e., brownfields) or other vacant land in support of regional
    economic development activities. These inventories are useful to both
    local decisionmakers, for purposes of planning where community growth
    and development will take place; and for private developers and
    corporations making location decisions by assisting them in identifying
    a site that has necessary characteristics. For example, a developer or
    corporation might need a certain size site with both highway and deep-
    water port access. Characteristics such as these are easily input and
    identified in a GIS system, frequently in a graphical manner with many
    associated layers of data (e.g., property titles, infrastructure maps,
    etc.), allowing prospective employers to easily locate sites.
        Market Feasibility: Some local communities have used EDA local
    technical assistance grants to determine the market feasibility of a
    particular brownfield site for adaptive reuse or other purposes. Market
    feasibility studies are an effective tool to determine what uses the
    market will support on a particular site. While these local technical
    assistance grants are typically small in size and scope, they can
    prevent costly mistakes and misguided investments that are sometimes
    made when they are not conducted. This stems from the fact that
    economically distressed communities sometimes have a pre-disposition
    toward the same types of industries that have historically been
    employers in an area, while market forces may be moving in another
    direction all together. Costly infrastructure investments to support
    obsolete industries are not an efficient and effective use of public
    resources, and will not support the long-term economic interests of
    local communities. Targeted market feasibility studies can help
    communities overcome these hurdles and identify tomorrow's higher-
    skill, higher-wage employers.

        Question 8. How could EPA and EDA strengthen their collaboration
    under current brownfields redevelopment authority?
        Response. As noted previously, EDA has been a longtime supporter of
    the Environmental Protection Agency's (EPA) Brownfields Initiative and
    was the first Federal agency to enter into a partnership agreement with
    EPA--signing a memorandum of understanding in 1995. Since 1997, EDA has
    invested over a quarter of a billion dollars in more than 250
    brownfield redevelopment projects. Last year alone, EDA invested
    approximately $55 million in 58 brownfield projects.
        Recognizing the need to buildupon this historic relationship and
    foster a more comprehensive approach to brownfields redevelopment, EDA
    is exploring new mechanisms to enhance coordination between Federal
    agencies and leverage existing assets at the Federal, State, and local
    levels. The Department of Commerce and the EPA are developing a
    memorandum of understanding to strengthen the partnership between the
    agencies, and replicate successful brownfields redevelopment
    partnerships such as the Brownfields Showcase Communities Initiative.

        Question 9. How can the Federal Government do a better job of
    creating the market-based solutions that attract private sector
    resources to distressed areas?
        Response. To attract private sector resources to distressed areas
    the Federal Government must foster an economic and regulatory
    environment that allows the private sector to do what it does best--
    grow the economy and create jobs. In some cases, this means that the
    government must streamline its efforts to assist communities, in others
    it involves preventing the government from inhibiting markets, in still
    others it entails directly assisting the private sector to overcome
    market barriers.
        Brownfields redevelopment is an area where government clearly has a
    role to play, by supporting private sector efforts to clean up and
    reuse contaminated former industrial and commercial land. In this
    regard, the Administration advances a two-pronged approach to national
    brownfields revitalization efforts--a permanent brownfields tax
    incentive and enhanced collaboration and cooperation among Federal
    agencies, through existing programs and appropriations, in support of
    local market-driven redevelopment efforts.
        Under current law, favorable tax treatment of contamination cleanup
    costs will expire at the end of 2003. As proposed in the President's
    fiscal year 2003 budget, the Administration believes that the
    brownfields tax incentive should be made permanent. According to
    government estimates, the $300 million annual investment in the
    brownfields tax incentive will leverage approximately $2 billion in
    private investment and return 4,000 brownfields to productive use.
        Furthermore, we believe that EDA's new investment criteria will
    help to target EDA investments in such a way that leveraging of private
    sector resources in distressed areas will be maximized. These new
    criteria channel EDA capital toward market-based, pro-active
    investments that will help to diversify local economies, attract
    private capital, promote higher wage jobs, maximize the governments
    return on investment, and have a high probability of success.

        Question 10. I note where the Commonwealth of Massachusetts has
    established a Brownfields Redevelopment Access to Capital program. In
    the last 2 years it has resulted in over 70 Brownfield cleanups and
    some $400 million in loans and cleanup. The key component of this
    program is State funded subsidized environmental insurance that for the
    most part secures loans and cleanup costs. Has the EDA looked at this
    program, and more importantly, can EDA grant funds to States or local
    governments be used to establish a similar program? If yes, will you
    work with my State to see if a program can be piloted this year to
    determine if it is feasible to do on a national basis?
        Response. EDA is aware of the Commonwealth's Brownfields
    Redevelopment Access to Capital (BRAC) program and its record assisting
    parties that purchase, cleanup and develop brownfields in
    Massachusetts, as well as the lenders who finance them. Programs such
    as BRAC both leverage limited existing public resources and help
    attract private sector capital. As you know, the goal of this
    innovative program is to use market-driven tools to create a positive
    financing environment for brownfields cleanup and redevelopment by
    leveraging a small amount of public funds (in the form of an insurance
    loan pool) into a large amount of private capital for revitalization
    efforts. In essence, through State-subsidized insurance allowing
    developers to more easily access capital needed for development
    projects the program transfers the environmental risks associated with
    brownfields redevelopment transactions to the insurer. The results have
    been impressive. Since inception, developers and lenders working
    through the BRAC program have invested over $600 million ($400 million
    in 2001 alone) while creating or retaining some 5,800 permanent, full
    time jobs in the State. Nevertheless, we believe that additional
    research regarding the specific components of the program, and legal
    opinions from our counsel are prudent next steps in our exploration of
    this development tool.
                                     ______

      Response by David Sampson to Additional Question from Senator Smith
        Question. I was very pleased that you included eco-industrial
    development (EID) in your testimony. As you know, I have a strong
    interest in EID, an economic development concept that partners growth
    with conservation and efficiency. I believe it fits well with the
    mission of EDA.
        I have tried to incorporate this concept into a few of the bills I
    have worked on, including the Appalachian Regional Commission Act and
    the Water Investment Act. In the two bills before the committee today,
    I see great potential to further develop the EID concept.
        I understand that you have concerns with these two bills, however,
    if the committee proceeds with them and your concerns can be addressed,
    do you see a means to buildupon EID through them and to foster a better
    understanding of this important development tool?
        Response. EDA has been actively involved in supporting eco-
    industrial development as a preferred redevelopment technique for
    brownfields impacted areas and has supported many of the nation's early
    efforts in this regard. Eco-industrial development is also an example
    of an area where EDA has coordinated closely with EPA and other
    partners to achieve local development objectives. EDA will continue to
    support this innovative development concept through its existing
    programs and appropriations. As noted previously, eco-industrial
    development was identified together with brownfields redevelopment and
    technology-led development as one of three primary investment types
    that EDA is interested in under its Public Works and Economic
    Development Facilities Assistance program this fiscal year.
        I believe there is ample opportunity to advance this innovative
    development technique under EDA's existing authorities and
    appropriations. I look forward to working with you and the other
    members of the committee to find new and better ways to promote eco-
    industrial development issues.
                                   __________
     Statement of Elizabeth Humstone, Executive Director, Vermont Forum on
     Sprawl and Vice Chair, City of Burlington, Vermont Planning Commission
        Good morning Chairman Jeffords, Ranking Member Smith, and members
    of the committee, I am Elizabeth Humstone, Executive Director of the
    Vermont Forum on Sprawl and Vice Chair of the Burlington, Vermont
    Planning Commission. I appear today both as a Vermonter and on behalf
    of the American Planning Association.
        The American Planning Association represents 32,000 professional
    planners, planning commissioners, and citizen activists interested in
    shaping the vision for the future of their communities. APA's members
    are involved in formulating planning policies and land-use provisions
    at all levels of government. APA has a long history of promoting public
    policies to improve quality of life in the nation's communities and
    neighborhoods through better planning.
        APA has long promoted smart growth and believes strongly that good
    planning is essential to achieving it. We are here this morning to
    offer our vision for smart growth and support for the legislation under
    consideration by the committee, the Community Character Act and the
    Brownfields Site Redevelopment Assistance Act.
        As one engaged daily in the struggle to achieve growth that is
    consistent with Vermont values of environmental quality, rural working
    landscape, healthy town centers and community values of sharing, access
    and equity. My organization, the Vermont Forum on Sprawl, works to
    assist citizens and communities throughout the State in achieving
    compact settlement surrounded by rural landscape while encouraging
    community and economic development consistent with this vision.
        We are not alone in this quest. In Vermont, ten non profit
    organizations, including affordable housing, social equity, planning,
    historic preservation and environmental groups, have embraced a common
    set of smart growth principles and banded together to work
    cooperatively on these issues. The Forum also is part of the national
    Growth Management Leadership Alliance, a collection of grassroots
    organizations promoting smart growth in States and communities.
        My work as Vice Chair of Burlington's Planning Commission and
    nearly 30 years of experience working with communities on land use
    issues means that I know first hand how planning informs development
    patterns, the challenges that communities face in achieving development
    that builds value while promoting high quality of life, and the
    importance of local land use authority as an instrument to reflect the
    vision of local citizens. However, I have also developed a keen
    understanding of the absolutely vital role that the State and Federal
    Governments play in the development process.
        I applaud you Mr. Chairman, Ranking Member Smith and members of the
    committee for demonstrating the vision and leadership to hold this
    hearing, which is, I believe, the first time a congressional committee
    has specifically examined the issue of smart growth. I would also like
    to thank Senator Chafee for his strong efforts in introducing and
    supporting the subject of today's hearing, the Community Character Act.
    My home region is certainly well represented today.
        Americans are increasingly aware and concerned about unplanned
    growth and its byproducts-loss of open space, congestion, limited
    housing options, decline of neighborhoods, empty strip development, and
    loss of ecological biodiversity-as clearly indicated by surveys and the
    passage of numerous local ballot initiatives to address these issues.
    This hearing is an important step in advancing the public discussion
    about how the Federal Government can appropriately and effectively
    support State and local smart growth activities that seek to address
    these problems.
                           importance of smart growth
        Smart growth refers to a citizen-led movement taking root across
    the Nation as citizens seek ways of reversing decades of policies that
    have led to what's commonly referred to as sprawl. Sprawl is the all-
    too-familiar pattern of strip development and spread-out, auto-
    dependent, low-density development in the countryside that leads to a
    gradual decline in community life and values, and the erosion of the
    economic base in cities and towns.
        Smart growth, by contrast, is a set of public policies designed not
    to stifle growth, as some critics would have it, but to promote
    development in ways that create communities of balance, consumer
    choice, and lasting value. Smart growth is planning, designing,
    developing, and revitalizing communities to promote a sense of place,
    preserve natural and cultural resources, minimize public outlays, and
    equitably distribute the costs and benefits of development. Smart
    growth enhances ecological integrity over the short-and long-term, and
    improves the quality of life by expanding the range of transportation,
    employment, and housing choices in a fiscally responsible manner.
    Compact, pedestrian-oriented, mixed-use development patterns epitomize
    smart growth and achieve more sustainable communities.
        Smart growth is a broad-based, grassroots-driven, bipartisan
    movement. Every political barometer--polls, legislation, executive
    orders, budget proposals and ballot initiatives--indicates that
    planning reform and smart growth are major concerns. A recent APA
    analysis of planning reform activity in the States during the past 3
    years confirms that planning reform and smart growth are among the top
    political concerns in statehouses across the Nation. More than 2,000
    planning bills were introduced between 1999 and 2001, and approximately
    20 percent of them were approved.
        In Vermont in the past 4 years, our legislature, with the support
    of Governor Dean, has passed bills that provide significant new
    incentives for downtown development, direct State agencies to manage
    their investments and programs to support smart growth, and reinforce
    the importance of town plans in State permit proceedings.
        Activity has been bipartisan; of the 24 smart growth executive
    orders issued between 1992 and 2001, 12 came from Republican Governors
    and 12 from Democratic Governors; 27 Governors--15 Republicans, 10
    Democrats, and 2 Independents--made specific planning and smart growth
    proposals in 2001. The President's own cabinet reflects this support
    with former Governors Whitman, Thompson, and Ridge along with former
    County Executive Martinez all having taken leading roles in support of
    planning and smart growth during their tenure in State or local
    government. This bipartisan interest and support for smart growth is
    further reflected in the work of this chamber's Senate Smart Growth
    Task Force. Mr. Chairman, we thank you for your leadership of this
    effort as co-founder and co-chairman of the Task Force.
        In Vermont, affordable housing advocates, businesses, developers,
    environmentalists, historic preservationists, community development
    specialists, planners and social equity organizations are all working
    toward smart growth. For example, the Vermont Forum on Sprawl is allied
    with the Vermont Business Roundtable, a policy organization of 125
    chief executive officers of large and small Vermont companies, to
    develop new models for commercial and industrial development more
    reflective of smart growth principles. The Coalition for Vital
    Downtowns--including the State homebuilders and realtors associations,
    League of Cities and Towns, State chamber of commerce, a regional
    chamber of commerce, developers, the Preservation Trust of Vermont, and
    our organization--developed and successfully lobbied for more
    incentives for downtown development. More recently, the Vermont Smart
    Growth Collaborative, so far made up of 10 diverse organizations, is
    pooling its resources and technical expertise to promote better State
    agency planning, to assist communities, and to build public awareness
    of the issues with sprawl and the opportunities with smart growth.
        Smart growth provides a framework for growth and development that
    assists all types of communities: inner cities, first ring suburbs,
    exurban communities, small towns, and rural America. Importantly, smart
    growth recognizes and promotes multijurisdictional cooperation and
    regionalism in planning as means of coordinating development that leads
    to greater efficiencies, reduced public expenditures, enhanced quality
    of life, and protection of natural resources.
        Many people believe that smart growth does not apply to rural areas
    or that curbing sprawl in small towns means ``no growth.'' My
    experience in Vermont demonstrates that the opposite is true. We are
    slowly destroying our valuable farm and forest land with wasteful,
    large lot development often dictated by well-intended local
    regulations. Our once scenic highways are becoming congested as the
    roadsides fill up with fast food restaurants, gas stations, strip
    centers and big box stores. Vermont communities are experimenting with
    alternatives, such as the Richmond (2000 population: 4,090) housing
    project, a relatively dense, but attractive, pedestrian-oriented,
    affordable housing complex that fits well with the historic village
    character. A new two-story Filene's department store in downtown
    Burlington shows that 150,000 square feet of retail space can fit into
    a built-up area and does not have to go on a corn field.
        In addition to citizen concerns about eroding quality of life, one
    of the major catalysts for smart growth and improved planning is the
    recognition of the increasingly high costs, for government and
    individual taxpayers, related to existing patterns of development.
    There is growing awareness that poorly planned development is a hidden
    tax on citizens and communities alike.
        States and communities are dealing with the growing fiscal
    implications of unmanaged growth facing metropolitan areas, suburbs and
    neighboring towns. Planning reforms and smart growth provide long-term
    savings by eliminating inefficiencies caused by inconsistent and
    uncoordinated planning and widely scattered development. With planning,
    communities can focus development where infrastructure is already
    located avoiding duplication and costly waste. The fiscal situation is
    becoming more acute as more States face deficit budgets. These deficits
    not only make smart growth planning more necessary to control costs
    over the long term. At the same time, ironically, financially strapped
    State and local governments are hard pressed to implement better
    planning in the short term. In the current State fiscal environment,
    Federal resources--financial and technical--are critically needed.
    Indeed, some data resources needed for good planning and new planning
    technologies (e.g., Geographic Information Systems, or GIS) can only be
    provided through the Federal Government. This situation makes Federal
    assistance in the form of the Community Character Act more timely and
    necessary than ever.
        The Vermont Forum on Sprawl has carefully examined the potential
    savings resulting from implementation of smart growth and improved
    planning. Our research has shown that sprawl patterns can cost from 3
    to 4 times more than compact patterns of development. More compact and
    carefully planned development patterns can lower costs for roads, bus
    and transit service, water and sewer service, school bus
    transportation, police and emergency services, thus saving on Federal,
    State and local governments' infrastructure expenditures. Developers
    also can save on land costs, installation costs for road, sewer, water,
    electric and gas lines, sidewalks, curbing, landscaping and other
    improvements, thus lowering the housing costs for homebuyers and
    renters.
                   role of planning in promoting smart growth
        Planning is essential to achieving smart growth. Plans help a
    community establish a common vision of development and a means of
    realizing that vision. The plan and the process of planning helps
    communities move boldly forward with a clear and articulate agenda for
    shaping their future. Within a planning framework of diverse interests,
    a regional perspective and a vision of place, the interests of
    preservation, environmental conservation, economic development, fair
    housing, transportation and development can all move forward more
    effectively. A plan is the foundation of a smart growth agenda. Various
    smart growth policies--from open space acquisition to urban
    revitalization--are only effectively realized in the context of a plan.
        Although planning is essential to achieving the smart growth
    vision, many States still rely on model ordinances developed by then-
    Commerce Secretary Herbert Hoover in the 1920's. These statutes, the
    Standard City Planning and Zoning Enabling Acts, were designed to
    support the rise of zoning and were almost universally adopted. While
    useful and innovative for their time, ordinances and planning for turn-
    of-the-20th-Century America are woefully inadequate for America at the
    turn of the 21st Century. It is the updating of these enabling statutes
    and the implementation of those reforms that the Community Character
    Act most seeks to support. But unlike the Hoover model, the Community
    Character Act does not suggest imposing a single model on all the
    States but rather supports reform and implementation that is developed
    based on the unique needs and context of individual States and
    communities.
        The pace of reform activity is astonishing. A recent APA report,
    ``Planning for Smart Growth: 2002 State of the States,'' found that
    reform is increasing in terms of the level of activity and the number
    of places focusing on the issue. Twenty 5 percent of the States are
    implementing moderate to substantial statewide comprehensive planning
    reforms, and nearly one-third of the States are actively pursuing their
    first major statewide planning reforms for effective smart growth.
    Fifteen Governors issued executive orders related to planning and smart
    growth during the past 2 years, compared to nine in the previous 8
    years combined. Eight States issued legislative task force reports on
    smart growth, compared to ten such reports during the entire decade of
    the 1990's. Reform efforts also can no longer be characterized as an
    East Coast--West Coast phenomenon. The movement is clearly spreading
    across the Nation with inland States representing 13 of the 25 total
    States actively engaged in reform efforts.
        Unfortunately, too many States and communities still lag behind.
    Approximately one-quarter of the nation's States have made few or no
    updates to the original 1920's model planning statute. These States,
    like the rest of the Nation, are struggling with issues like congestion
    and loss of agriculture land but lack the planning tools to cope
    effectively. Many counties and municipalities have no legal access to
    some of the most rudimentary planning techniques. New planning
    strategies and approaches are needed so growth and development can be
    managed in a way that maintains and improves quality of life.
        Even the States that have good planning laws are losing the battle
    to stop sprawl due to budget shortfalls, poor enabling statutes and
    inability and failure to implement what they have. For example, the
    State of Vermont for over 30 years has attempted to maintain its
    historic settlement pattern of compact community centers separated by
    rural countryside by adopting a State land development law (Act 250),
    in which Chairman Jeffords had a major role, and a State growth
    management law (Act 200), as well as providing incentives through the
    Vermont Housing and Conservation Board grants program and the Downtown
    Program. These laws and programs have generated strong interest in
    community planning, preserved 100,000's of acres of prime farm and
    forest land, provided over 6,000 units of perpetually affordable
    housing, and revitalized downtowns and village centers.
        Yet, despite many years of interest and concern about growth issues
    among the major political parties in Vermont, we still have sprawl, and
    it is getting worse. Why? There are many reasons, but among them are
    State public investments that work against State growth policies, poor
    local planning due to lack of training and technical expertise, lack of
    awareness of alternative ways to grow, and failure to coordinate
    planning among separate jurisdictions. In Vermont we have no State
    planning office, no funds to enforce our growth management act,
    extremely limited resources to provide technical assistance to our many
    small towns, and a regional planning system that has been ineffective
    in managing growth. The Vermont Forum on Sprawl is working to draw
    attention to these problems, but we need your help.
                          the community character act
        APA believes that the Community Character Act would be an effective
    and beneficial tool for promoting smart growth and improving planning
    while respecting State and local land-use prerogatives. I am greatly
    encouraged by today's hearing and hope that it is but the first step
    toward enacting this important legislation.
        APA is not alone in our support for the Community Character Act (S.
    975). Like smart growth in general, a broad-based coalition working to
    strengthen communities and neighborhoods through improved built and
    natural environments has joined in support of this legislation, and I
    am pleased to include this coalition's letter of endorsement with my
    testimony this morning. Likewise, the measure enjoys support among
    grassroots organizations like mine. In Vermont, eight groups comprised
    of citizens concerned about smart growth have endorsed the Community
    Character Act.
        The reason for the measure's strong support is that it responds to
    widespread citizen interest in smart growth by providing critical
    resources to help State and local leaders, business and environmental
    interests, and concerned citizens bring about positive change in their
    communities through better planning. It provides an incentive for
    better planning while maintaining flexibility for States and
    localities. Without legislating local or State planning policy, the
    bill would be a landmark in encouraging planning that achieves some key
    smart growth objectives, such as linking planning to implementation,
    encouraging regionalism and public participation, supporting housing
    choice and affordability, making more efficient use of land and
    infrastructure, and conserving vital resources.
        S. 975 encourage States to create a framework for smart growth
    planning without mandating local land-use policy. The bill provides
    support for innovative and updated tools needed by States and
    communities working to manage the many challenges presented by growth.
    Communities would not be forced to pursue smart growth strategies, but
    S. 975 would provide assistance to those that choose to do so.
        The bill supports planning reform and implementation through grants
    that could be used for a variety of planning and smart growth programs.
    Grant funding is designed to be flexible and responsive to local needs
    and vision. States could pass grant funding directly to local
    governments for planning activities. Grants could also be applied to
    activities other than statutory revision, such as research and
    development activities for State, regional or local planning, public
    meetings, policymaker workshops and coordination of local plans and
    Federal land management. Funding could also be used to acquire
    information technology and equipment to improve planning, such as GIS
    systems, and public understanding of the consequences of current
    development patterns, as well as envisioning alternatives.
        Mr. Chairman, your planned legislation to provide grant support for
    community visualization and decisionmaking technologies would greatly
    aid smart growth planning efforts. That legislation, in combination
    with the support possible through the Community Character Act, would
    greatly enhance planning and public participation in crafting a vision
    for the community. We look forward to continuing to work with you on
    behalf of both bills.
        Program eligibility would be broad and not limited to States
    revising enabling statutes. A major focus of the bill is promoting the
    reform of State planning statutes; however, States implementing reforms
    or seeking to bolster comprehensive planning would also be eligible for
    funding. S. 975 establishes criteria for grants that recognize
    statutory reform as an important priority but lays out other criteria
    under which any State could apply, including economic development,
    environmental protection and regionalism.
        The Community Character Act is designed to promote locally driven
    planning innovation through resources, technical assistance and
    capacity building. Many areas, particularly rural regions and small
    towns, suffer from a lack of planning resources and expertise.
    According to a survey of county governments conducted last year, only
    39 percent of rural governments do comprehensive planning versus more
    than 70 percent of metropolitan governments. At the Vermont Forum on
    Sprawl we hear daily from citizens and local officials asking for help
    with local planning issues. Several thousand citizens have requested
    our Way To Grow! planning guides and nearly 25 percent of Vermont
    communities have been represented in our training courses. We are hard-
    pressed to meet the tremendous demand for help. S. 975 sets up a grant
    for local or regional planning pilot projects to promote smart growth
    and continued planning innovation. The measure also establishes a
    technical assistance and capacity building program that would support
    improved planning in a variety of ways, including expanded research,
    training programs, new data resources for local planning and improved
    intergovernmental cooperation.
        With such tremendous need for planning resources and the many
    opportunities for Community Character grants to make a substantial
    impact, the singular drawback to legislation before the committee is
    the limited amount of funding authorized. We recognize the fiscal
    limitations of the moment but hope that funding levels might ultimately
    be increased. APA has found through various studies that any investment
    in planning will pay dividends many times over in money saved on
    unnecessary waste, duplication and inefficiency. Quite simply, we
    cannot afford not to help communities plan.
        This legislation is also a long overdue step toward assisting
    tribal governments with comprehensive planning and promoting improved
    cooperation on land-use planning between Federal land management
    agencies and State and local land-use planning officials. The bill
    correctly notes that tribal governments routinely lack adequate
    resources for planning and that improved land-use planning would
    enhance environmental protection, housing opportunities and
    socioeconomic conditions for tribes. Some funding would be reserved for
    use by tribal governments. The bill also seeks to encourage improved
    consultation on land-use decisions among Federal agencies, State
    governments, local governments and nonprofit organizations.
        In Vermont the Community Character Act could help us review our
    existing State planning statutes and, with the involvement of diverse
    interest groups and citizens, propose ways to make them more effective.
    It might even generate interest in the return of our State planning
    office. It could support a statewide local planner training program
    that would improve the development and implementation of local plans
    reflecting community visions. Or it could help regional planning
    commissions and local governments arrive at better regional approaches
    to smart growth.
        But the reach of the Community Character Act certainly is not
    limited to my State. Potential uses of the legislation include helping
    States with formal State smart growth commissions, such as Kentucky,
    Colorado, Florida, and New York; easing the implementation of planning
    reform in States like Pennsylvania, Wisconsin, New Jersey, and
    Tennessee; or simply aiding the local and regional innovations in
    States across the Nation.
                            need for a federal role
        Some will argue that because planning and land use are local
    responsibilities, the Federal Government should play no role. APA
    recognizes that all levels of government, as well as the nonprofit and
    public sectors, play an important role in creating and implementing
    policies that support planning and smart growth. The complex array of
    incentives, assistance, regulations, and financial considerations
    already in place affect and drive development practices. The current
    patterns of development do not occur in a vacuum.
        All levels of government--Federal, State, regional, county, and
    local--have a proper role and responsibility in improving communities
    and supporting smart growth. Local governments have long, and rightly,
    been the principal stewards of land and infrastructure resources
    through implementation of land-use policies. Smart growth respects that
    tradition, yet recognizes the important roles that Federal and State
    governments play as leaders and partners in advancing and implementing
    smart growth principles.
        In fact, the Federal Government has often contributed to sprawl in
    the past. The Federal Government remains the nation's largest landlord.
    While we often think of the vast Federal tracts of land in West, we
    might also consider all the post offices, courthouses, and Federal
    buildings that dot the landscape in almost every town and county in the
    Nation. All too often in the past, Federal facility regulations or
    outright exemptions from planning and land-use policies have led to
    Federal agencies harming downtowns while simultaneously aiding and
    abetting sprawl.
        In Vermont, right now, to meet Federal design specifications, a new
    Immigration and Naturalization Service building in Chittenden County
    will be forced to locate on a greenfield because no existing downtown
    buildings or sites can qualify. Numerous communities, such as
    Westminster and Enosburg Falls, are fighting to keep their post offices
    in their town centers, but many have already lost the battle. We are
    most appreciative of the leadership of Chairman Jeffords and Senator
    Baucus in addressing the problem of ``postal sprawl'' with Federal
    legislation, S. 897.
        Similarly, other Federal policies, seemingly unconnected to land-
    use and development patterns, have had a profound, if unintended,
    impact. Post World War II policies ranging from the mortgage interest
    tax deduction to water and sewer extension aid were major factors in
    shaping patterns of development. Few would argue the benefits
    associated with expanding homeownership and providing needed
    infrastructure. However, we are now at a moment in our nation's history
    where, as good stewards of our resources, we must address how we can
    better plan and coordinate development if we hope to maintain the
    quality of life and quality of community demanded by citizens. If the
    Federal Government has been part of the problem, surely it can now be
    part of the solution.
        I believe that Federal incentives and assistance for smart growth
    are appropriate for you to consider because promotion of smart growth
    is squarely in the national interest and demands a national response. I
    am not alone. A national public opinion survey conducted for APA found
    that 78 percent of voters in the last election believe Congress should
    provide incentives to help promote smart growth and comprehensive
    planning. This same survey found that more than three-quarters of those
    surveyed believe it is ``important for the 107th Congress to help
    communities solve problems associated with urban growth.'' These
    findings were underscored by almost identical support levels in a
    survey conducted by my panel colleague this morning, Don Chen and Smart
    Growth America, as well as surveys conducted on behalf of the Forum on
    Sprawl.
        Many who oppose assistance for planning today will be back tomorrow
    looking for tax breaks and infrastructure assistance to support the
    development status quo. If we are prepared to support tax incentives or
    other forms of assistance for specific types of development in specific
    places, however beneficial, why then can we not offer assistance to
    communities for better planning and coordinating that development? I
    would say to my friends who might oppose an incentive for planning, how
    is one more intrusive of local prerogatives than the other? Should they
    not work together?
        Some interest groups will wrap themselves in the mantle of smart
    growth, crowing about its importance, yet consistently oppose any real
    legislative reform. These organizations view any incentive or
    assistance, however modest or voluntary, as somehow ``Federalizing''
    land use. Nothing in the legislation before the committee this morning
    contains anything of this sort. Support for planning and smart growth
    must be more than rhetorical exercises intended to respond to public
    opinion polls.
        The types of incentives envisioned in both the Community Character
    Act and the Brownfields Site Redevelopment Assistance Act are in the
    national interest because each would provide broad environmental
    enhancement outcomes and would do so without relying on regulations and
    enforcement. In addition, the kind of strategic planning, investment
    coordination, and public participation envisioned in both bills would
    leverage a wide range of existing Federal investments, from Community
    Development Block Grants to an array of new or expanded Federal land
    conservation programs. The Federal Government offers many programs
    aimed at economic and community development. However, all too often
    these programs provide little or no support for planning. An investment
    in planning would increase the ultimate impact of the Federal
    investment.
        The Environmental Protection Agency under both the Clinton and Bush
    administrations has recognized the need for a Federal role in promoting
    planning and smart growth. Administrator Whitman recently made the
    Administration's support clear: ``Addressing new environmental
    challenges requires us to manage all of our resources better--economic,
    social, and environmental--and manage them for the long term. That is
    why Smart Growth is so important--it is critical to economic growth,
    the development of healthy communities, and the protection of our
    environment all at the same time. The Bush Administration--and the EPA
    especially--understands the importance of Smart Growth.''
        Administrator Whitman was echoing comments offered by Housing and
    Urban Development Secretary Martinez during his confirmation hearing
    when he indicated that smart growth issues would be a priority at HUD.
    He called for ``a national dialog on the challenges of growth and its
    impact on quality of life'' in his testimony, and in response to a
    question on what HUD's role should be in smart growth, Martinez
    answered that managing growth is part of HUD's mission. He also
    stressed that a Federal response to growth issues goes beyond HUD and
    would involve other agencies and departments.
        There is also a strong need to promote multi-state cooperation on
    these issues. The Community Character Act specifically attempts to do
    this by enabling grants for multi-state regional cooperation on
    planning. Fostering regional cooperation and education is essential
    because natural resources, watersheds, city borders, and development
    impacts do not stop at artificial political boundaries. This is
    certainly the case in New England, where all the States in the region
    recognize the need to learn from each other and collaborate in order to
    produce sustainable, smart growth outcomes throughout the region. We
    know we cannot go it alone in Vermont and be successful without
    engaging other States. We have worked with New Hampshire in assisting
    them with analyses of State expenditure patterns as part of a State
    sprawl report. Additionally, we have conducted joint training and
    planner exchange programs with the Maine State Planning Office, and a
    similar program has been requested by people in Massachusetts.
        But New England is not the only place in the Nation where this type
    of multi-state cooperation on planning is needed. Federal action is
    sorely needed to help overcome the obstacles of working across State
    lines. Grants through the Community Character Act for precisely this
    kind of activity would provide a valuable incentive for improving
    regional communication and collaboration, resulting in improved land
    use throughout an entire region.
                 brownfields site redevelopment assistance act
        APA and other proponents of smart growth were delighted by the
    final passage of brownfields reform last year and equally pleased to
    see the Bush Administration's budget request for brownfields programs.
    Mr. Chairman, you and the members of this committee deserve great
    praise for leading the long effort to seeing brownfields reform become
    law.
        Now is the time to build on that success with targeted assistance
    for the planning and redevelopment of brownfields sites. Earlier
    efforts focused on solving liability problems and providing resources
    for site identification, evaluation and clean-up. These were critically
    important first steps. But in order to realize the full economic,
    environmental, and social potential of brownfield redevelopment, we
    must go beyond a focus on remediation alone to an approach that places
    brownfields within the larger context of community reinvestment and
    revitalization. This is precisely what S. 1079 does.
        By providing resources for planning, development of public
    facilities and services, revolving loan funds for business development,
    and general technical assistance associated with brownfield sites, this
    legislation allows communities to not only cleanup sites but also make
    these sites part of a broad economic development plan and strategy. In
    essence, this bill would function as a ``multiplier'' effect for
    current Federal investments in brownfield remediation and further
    leverage private sector investments in these communities.
        As one familiar with the particular challenges facing small towns
    and rural areas, I am pleased that this legislation recognizes that
    brownfields are not limited to urban America. Provisions focusing on
    communities experiencing difficulties related to economic
    restructuring, outmigration, and infrastructure deterioration will make
    this a valuable resource for small towns.
        The planning provisions in the bill are positive steps forward. By
    promoting consistency between plans and brownfield projects, this
    legislation helps ensure that grants would not just provide isolated
    assistance but would be a catalyst for broader economic and community
    development. Additionally, the legislation rightly articulates the
    importance of community participation and visioning in planning for
    brownfields-related redevelopment. Such provisions help answer long-
    standing concerns about environmental justice in distressed
    neighborhoods.
        Finally, the bill envisions assistance for brownfield redevelopment
    projects that ``conserve environmental and agricultural resources.''
    This focus directly responds to the demand for smart growth plans and
    projects. By including assistance for adaptive reuse, development of
    land and abandoned property, and the of creation parks and recreational
    opportunities, the bill can be an incentive for improved planning and
    smart growth.
                                   conclusion
        Planners are heartened by this hearing and the important step
    forward it represents. We are further encouraged by the legislation
    contemplated this morning that would offer vital assistance to numerous
    States and communities struggling with the consequences of change,
    whether rapid growth and development or economic decline. These bills
    recognize that the Federal Government can, and should, be a
    constructive partner with communities seeking innovative solutions to
    improving local quality of life through better planning and land use.
    The Community Character Act and the Brownfields Site Redevelopment
    Assistance Act are a modest investment that will bring substantial
    dividends in improving the livability of cities, towns, neighborhoods,
    and rural areas throughout the Nation. We hope this hearing is but a
    first step toward their enactment.
         We are committed to working with you, Mr. Chairman, and this
    committee in making the promise of smart growth a reality.
        Mr. Chairman, this concludes my testimony. I thank you and the
    committee for the opportunity to be here today, and I would be pleased
    to answer your questions at the appropriate time.
                                     ______

                                                         March 4, 2002.
    Hon. James Jeffords, Chairman,
    U.S. Senate,
    Washington, DC.

    Hon. Robert Smith, Ranking Minority Member,
    U.S. Senate,
    Washington, DC.
        Dear Chairman Jeffords and Senator Smith: The undersigned
    organizations, representing a broad array of interests and professions
    working to strengthen communities and neighborhoods through improved
    built and natural environments, applaud your leadership in holding a
    hearing on smart growth and, particularly, the Community Character Act
    (S. 975). We endorse this bipartisan legislation introduced by Sen.
    Lincoln Chafee and urge you, and your committee colleagues, to consider
    and approve S. 975.
        This hearing is an important step in advancing the public
    discussion about how the Federal Government can appropriately and
    effectively support State and local smart growth activities. S. 975
    provides an opportunity to assist and complement State and local
    efforts to promote smart growth and is a perfect example of how to
    support local planning efforts without undermining local control of
    land use. With most State and local governments facing dire fiscal
    situations, the need for limited Federal assistance is greater than
    ever.
        Americans are increasingly aware and concerned about unplanned
    growth and its byproducts--loss of open space, congestion, limited
    housing options, strip malls, and loss of ecological biodiversity--as
    clearly indicated by surveys and the passage of numerous local ballot
    initiatives to address these issues. S. 975 responds to these concerns
    by authorizing voluntary funding assistance to State, tribal, and local
    governments that request help in planning and implementing their
    respective visions of sustainability.
        The legislation recognizes that land use planning should not stop
    at arbitrary jurisdictional boundaries and promotes coordinated,
    regional land use planning. Further, S. 975 seeks to address the
    tremendous need for planning and community development by the nation's
    tribal governments. Other provisions allow grants for acquiring new
    information technology to improve local planning, pilot projects to
    support innovative planning, and technical assistance. This legislation
    promotes smart growth principles and encourages States and localities
    to create or update the framework necessary for good planning. It
    creates a partnership with communities through incentives, not
    mandates. This program is a modest investment that will bring
    substantial dividends in improving the quality and character of cities,
    towns, and neighborhoods.
        Good planning and design make good business sense, in addition to
    minimizing some of the harmful impacts that unmanaged growth can have
    on local and regional ecosystems. Long-term planning and design help to
    create communities with character and a variety of options for living
    and working. As people are drawn to such places--as tourists or
    residents--the economy thrives.
        Again, thank you for your leadership and vision in holding this
    important hearing. We ask that you continue to demonstrate your support
    for smart growth by supporting and adopting S. 975.
                Sincerely,
                        Lisa Blackwell, Managing Director, Government
                                Affairs, American Institute of Architects;
                                W. Paul Farmer, AICP, Executive Director,
                                American Planning Association; Marcia
                                Argust, Director, Legislative and Public
                                Affairs, American Society of Landscape
                                Architects; Mark Shaffer, Senior Vice
                                President, Defenders of Wildlife; Robert
                                Sokolowski, Executive Director, National
                                Association of Regional Councils; Deron
                                Lovaas, Deputy Director, Smart Growth
                                Policies, Natural Resources Defense
                                Council; Gordon Kerr, Director,
                                Congressional Affairs, National Trust for
                                Historic Preservation; John Kostyack,
                                Senior Counsel, National Wildlife
                                Federation; Meg Maguire, President, Scenic
                                America; Debbie Sease, Legislative
                                Director, Sierra Club; Don Chen, Executive
                                Director, Smart Growth America.
                                     ______

                                                         March 4, 2002.
    Hon. James Jeffords, Chairman,
    U.S. Senate,
    Washington, DC.

    Hon. Robert Smith, Ranking Minority Member,
    U.S. Senate,
    Washington, DC.
        Dear Chairman Jeffords and Senator Smith: The undersigned
    organizations, representing a broad array of interests and professions
    working to strengthen communities and neighborhoods through improved
    built and natural environments, applaud your leadership in holding a
    hearing on smart growth and, particularly, the Community Character Act
    (S. 975). We endorse this bipartisan legislation introduced by Sen.
    Lincoln Chafee and urge you, and your committee colleagues, to consider
    and approve S. 975.
        This hearing is an important step in advancing the public
    discussion about how the Federal Government can appropriately and
    effectively support State and local smart growth activities. S. 975
    provides an opportunity to assist and complement State and local
    efforts to promote smart growth without undermining local control of
    land use. With most State and local governments facing dire fiscal
    situations, the need for limited Federal assistance is greater than
    ever.
        Vermonters, like many Americans, are increasingly aware and
    concerned about unplanned growth and its byproducts--loss of open
    space, congestion, decline of neighborhoods, limited housing options,
    strip malls, and loss of ecological biodiversity. According to our 2001
    poll, nearly two thirds of Vermonters think that current development
    trends will lead to sprawl and that there is a need to take action to
    stop it. S. 975 responds to these concerns by authorizing voluntary
    funding assistance to State and local governments that request help in
    planning and implementing their respective visions of sustainability.
        Many communities find that they cannot develop or implement their
    visions due to outmoded State planning and zoning enabling laws. The
    legislation will offer assistance to States that want to update their
    laws and find better ways to provide assistance to communities. Other
    provisions allow grants for acquiring new information technology to
    improve local planning, pilot projects to support innovative planning,
    and technical assistance. S. 975 recognizes that land use planning
    should not stop at arbitrary jurisdictional boundaries and promotes
    coordinated, regional land use planning. This program is a modest
    investment that will bring substantial dividends in improving the
    quality and character of cities, towns, and countryside.
        Good planning and design make good business sense, in addition to
    minimizing some of the harmful impacts that unmanaged growth can have
    on local and regional ecosystems. Our work with the business community
    in Vermont demonstrates their commitment to long-term planning and
    better design that will create communities with character and a variety
    of options for living and working. As people are drawn to such places--
    as tourists or residents--the economy thrives.
        Again, thank you for your leadership and vision in holding this
    important hearing. We ask that you continue to demonstrate your support
    for smart growth by supporting and adopting S. 975.
                Sincerely,
                                       Elizabeth Humstone,
                                               Executive Director, Vermont
                                                   Forum on Sprawl.

                                       Virginia Rasch,
                                               Executive Director,
                                                   Association of Vermont
                                                   Conservation
                                                   Commissions.

                                       Mark Sinclair,
                                               Senior Attorney and Vice
                                                   President, Conservation
                                                   Law Foundation.
                                       Brian Dunkiel,
                                               Attorney for Friends of the
                                                   Earth.

                                       Paul Bruhn,
                                               Executive Director,
                                                   Preservation Trust of
                                                   Vermont

                                       Curt McCormack,
                                               Director of Advocacy,
                                                   Vermont Public Interest
                                                   Research Group.

                                       Elizabeth Courtney,
                                               Executive Director, Vermont
                                                   Natural Resources
                                                   Council.

                                       Sharon Murray,
                                               President, Vermont Planners
                                                   Association.

           Statement of Deborah Anderson, Director Wood Partners, LLC
        Chairman Jeffords, Senator Smith, and distinguished Members of the
    Environment and Public Works Committee, my name is Deborah Anderson. I
    am a Director of Wood Partners a multifamily real estate development
    firm located in Durham, North Carolina. I am here today on behalf of
    the National Multi Housing Council and the National Apartment
    Association, trade associations representing the nation's multifamily
    property developers, owners, managers and financiers.
        NMHC and NAA commend the members of the committee for their work on
    the important issue of strengthening America's communities. As I am
    sure you already know, in recent years the concept of ``smart growth''
    has taken the country by storm. In November 2000, more than 200 ballot
    initiatives were passed on suburban sprawl and open space preservation.
    While this is largely a State and local issue, there is also an
    important role for the Federal Government. We believe that the
    Community Character Act under consideration today fits that role by
    providing the funding and incentives needed to help State and local
    governments develop sound and comprehensive land use plans.
        Tired of struggling with traffic, pollution, long commutes and
    overcrowded schools, Americans are calling for more livable
    communities. They are looking for pedestrian friendly neighborhoods
    with more open space and better traffic flow. They are seeking
    communities with walkable distances between homes and nearby shopping,
    schools and entertainment.
        Understanding that growth is inevitable, many State and local
    policymakers are searching for ways to expand without sacrificing
    quality of life. I know from my own experience in dealing with land use
    policymakers on the State and local levels that they face complex
    decisions as they endeavor to integrate all of the ingredients of
    successful communities into specific land use decisions. Increasingly,
    these decisionmakers are coming to appreciate that smart planning will
    require new ways of thinking and new regional approaches.
        Many are expanding their community development toolboxes to include
    important, but often overlooked, assets, such as higher density
    housing. As a developer of high quality apartment homes, I believe that
    apartments are an integral piece of the smart growth solution.
    Apartments conserve land to help preserve open space and create
    pedestrian-friendly neighborhoods. They also use municipal
    infrastructure more efficiently. For example, apartment households
    generate 30 to 40 percent fewer vehicle trips than single-family homes.
    Apartments place less burden on local schools and regional
    transportation systems. They are an important driver of economic
    development. They help revitalize neglected neighborhoods, create new
    jobs and provide local, State and Federal tax revenues. Apartment homes
    are increasingly becoming the housing type of choice for the new
    demographic representing both the aging of our population and the boom
    in younger households for the first time in 20 years.
        Despite the newfound appreciation of apartment living among
    consumers, many local governments still have barriers in place to
    higher density housing, such as zoning programs that do not permit
    compact development. Some rules require housing and non-housing uses to
    be separated. The end result is that apartment developers, like myself,
    eager to design and deliver the new pedestrian-friendly neighborhoods
    citizens are calling for, are often blocked from doing so.
        This is where Congress can play a role. NMHC and NAA support S.
    975's creation of a Federal grant program to provide States with the
    additional financial resources they may need to support and encourage
    local authorities to update their land use planning activities. The
    bill wisely relies on incentive-based measures, rather than command and
    control systems.
        The bill also properly recognizes the need to explore regional land
    use planning. Smart growth issues often span the jurisdictional
    coverage of several communities, particularly in the areas of
    transportation and economic development. While the need for regional
    planning is almost universally recognized, there are few effective
    models. S. 975 specifically states that multi-state land use planning
    should be facilitated through the grant program. This incentive will go
    a long way to jump-starting a fresh approach to regional planning.
        S. 975 also strikes an important note with its recognition that
    economic development is an important consideration in land use
    planning. According to an Urban Land Institute study, real estate
    capital represents approximately 20 percent of the nation's total gross
    domestic product. On the local level, real property taxes constitute
    approximately 70 percent of all tax revenue. These facts support the
    idea that the economic consideration posed by development are properly
    considered in land use planning.
        NMHC and NAA also strongly support the legislation's direction that
    ``a range of affordable housing options'' be included as a requirement
    by States before receiving Federal moneys (Sec. 4(b)(1)(F)).
    Communities that exclude apartments and other affordable housing
    jeopardize their own continued prosperity. In doing so, they squeeze
    out a segment of the population that is vital to local businesses as
    both customers and employees. Communities that offer a diversified work
    force and a wide range of housing options are more likely to attract
    and retain top employers. An adequate supply of affordable housing,
    therefore, can be essential to a municipality's economic growth. The
    fact that S. 975 encourages consideration of affordable housing options
    will encourage communities to take a fresh look at their approach to
    this issue and consider ways they can support more affordable housing.
    This is particularly important in high cost areas where the cost of
    land and associated development costs have diminished the ability of
    the private market to create affordable housing on its own.
        NMHC and NAA also support the legislation's position that the
    States, and not the Federal Government, are responsible for choosing
    how the grant money is to be used (Sec. 4(c)). We believe that land use
    is, and should remain, a local decision. Each unique jurisdiction has
    its own goals and priorities, and land use planning should reflect
    that.
        As a developer, I have worked with local planning boards and town
    councils in several States. While our discussions often focus on common
    elements--roads, schools, playgrounds and water treatment facilities--
    the answers to those questions vary with each locale. There is simply
    no ``one-size-fits-all'' approach to land use planning.
        NMHC and NAA support the Community Character Act with the
    understanding that the bill does not endorse, by oblique reference, any
    one particular land use-planning standard. We are specifically
    concerned that the American Planning Association's (APA) recent
    publication, Growing Smart Legislative Guidebook not be viewed as the
    definitive land use guide. APA's Guidebook contains many sound
    provisions, but it does not enjoy universal support among stakeholders.
    Dissenting comments pointing out where the book is unbalanced in its
    approach are attached to this testimony for your review. The important
    principle here is that we believe State and local jurisdictions must be
    free to study and employ a variety of planning tools, as they deem
    appropriate. The Federal Government should encourage land use planning,
    but it should not specify the plan. Land use decisions should properly
    remain the precinct of the local jurisdiction.
        We applaud the fact that S. 975 allows grant funds to be used for
    education and consultation with policymakers (Sec. 4(d)). We believe
    there is need for greater dialog and information sharing between
    academicians, policymakers and the public on matters such as
    infrastructure needs; economic sustainability; and how growth policies
    affect the ability of the private market to provide affordable housing.
        We believe the provision to encourage Pilot Projects of new land
    use planning activities developed by local policymakers will help
    create smarter, answers to our nation's growth challenges. We also
    endorse the use of funds to develop voluntary educational programs, new
    technologies and new electronic data bases to support land use planning
    (Sec. 5(b)) to support local policymakers who do not always have access
    to these resources.
        In summary, NMHC and NAA believe the role of the Federal Government
    in land use planning should be limited to funding through grants. As
    the distinguished Senator from Rhode Island aptly stated when
    introducing the bill, ``[t]hrough enactment of transportation, housing,
    environmental, energy, and economic development laws and requirements,
    Congress has created a demand for State and local planning. In fact,
    the Community Character Act should be viewed as providing the Federal
    payment for an unfunded mandate whose account is overdue.''
        As the Nation moves forward to strengthen its communities and
    accommodate changing demographics, local land use statutes will need to
    be responsive to community needs. This bill is intended to provide
    support for State and local land use planning activities without
    undermining local land use controls. Thank you.
                                     ______

           ATTACHMENT: Dissenting Comments on the APA Growing Smart
                             Legislative Guidebook
         Comments of Paul S. Barru on Behalf of the American Road and
    Transportation Builders Association; International Council of Shopping
     Centers; National Apartment Association; National Association of Home
      Builders; National Association of Industrial and Office Properties;
     National Association of Realtors; National Multi Housing Council; and
                            Self Storage Association
                                    preface
        As the member of the Growing Smart Directorate representing the
    ``built environment'', I speak for the citizens who own land and who,
    in any proposed use of such land, would be subject to the rules and
    processes proposed in the Guidebook if adopted by States, regions,
    counties, or municipalities. I submit this on behalf of the
    homebuilders, office and industrial developers, real estate agents,
    general contractors, road builders, engineers, architects, and others
    who are generally classed as the built environment.
        Clearly, I will not presume to comment on the whole of this
    monumental work, but only briefly on three things: (1) assumptions that
    either do or should underlay the process; (2) a major disappointment in
    the Guidebook; and (3) a selected group of specific issues of such
    major import to the whole enterprise of Smart Growth and its twin,
    Smart Process, that if not implemented and managed properly, have the
    potential to undermine much of the value that has been achieved.
                                  assumptions
        Smart Growth means planning for growth, not slowing growth or no
    growth. The Guidebook is successful in reaching its objective of Smart
    Growth and its twin, Smart Process, in some specific areas. However, on
    the whole, it falls far short of what might have been achieved. This is
    hardly a surprise when you consider the current state of growth
    management and the constant battleground it has become. I feel the
    process began to come undone as it moved ahead with a broad vision of
    Smart Growth, because working assumptions and definitions were not
    constantly revisited to see if they had continuing validity. In the
    end, the process sought to satisfy two or more visions, often imposed
    from outside of the staff and Directorate, by presenting alternatives
    rather than doing the harder job of reaching consensus on a common
    vision. Alternative choices for managing growth--within a common vision
    of Smart Growth that means planning for growth as needed, not stopping
    it--are what is needed to meet the needs of divergent communities.
        Any approach to Smart Growth must be comprehensive. This means that
    it must include concerns for the environment, the economy, and social
    equity or justice. These three elements must be balanced. Like a three-
    legged stool, if the legs are not the same length, it will not provide
    a solid base to stand on; and if one leg is too long, the stool will
    tip over.
        The natural environment needs strong protection, but protection
    comes in many forms. Some lands need to be preserved in public
    ownership, while others are best protected by environmentally sensitive
    development. Still other lands are suitable for intense development to
    allow a community to accommodate its projected development needs. The
    Guidebook falls short in identifying various types of land that require
    protection and criteria to judge the best protection techniques. While
    limited in scope, the Guidebook focuses on limiting development in
    ``sensitive areas'' with little guidance on defining what they are and
    the best ways to protect them.
        The absence of an economist on the Directorate or of any
    significant economic or tax studies is an indication that the economics
    of Smart Growth were only peripherally addressed. When essential
    economic issues began to emerge, there was little willingness to
    indicate at the very least that they were important and needed to be
    considered, even if they were not included in any depth within the
    Guidebook. To deal with the economy seriously, beyond the Guidebook's
    modest efforts, you must include a consideration of economic
    development and job generation, especially how they interact in
    creating land use demand. Other related topics that need to be
    understood include how taxation policy drives land use decisions,
    favoring job generation without always addressing the provision of
    adequate housing to match those jobs; how housing, commercial, and
    retail markets interact in creating growth pressure; how you plan for,
    build, and finance infrastructure in a timely and cost-effective
    manner; among many other items that affect the economy.
        In the simplest terms, social equity is concerned with how well
    people can live in a community on the wages they are able to earn in
    jobs created by economic development and the degree to which growth
    benefits all segments of society. The Guidebook gives considerable
    protection from the adverse consequences of growth but does not
    adequately address the equity issues inherent in a community's failure
    to ensure that affordable housing for all income segments is available.
    The inclusions in the Guidebook are not sufficient.
        To judge APA adversely for not having predicted that
    ``comprehensive planning'' for Smart Growth included such a broad array
    of issues is unfair. This is an area of inquiry that grows as the
    interrelatedness of many issues and their importance to the whole
    emerges. While it might have been impossible to include all of these
    within the scope of the original enterprise, the work suffers by not
    indicating that these gaps exist. I hope that if the Guidebook
    undergoes revisions in future years, the APA will consider analyzing
    some of these areas and that broad advisory input from affected
    interest groups will be incorporated in such revisions. In the
    meantime, the absence of these issues in this Guidebook compromises its
    goal of providing pathways for Growing Smart.
        Growing Smart requires a blueprint or comprehensive plan that, when
    adopted, becomes public policy.--The process for developing any
    effective public policy must be inclusive, deliberate, and, to the
    greatest degree possible, achieved by consensus. It cannot be a top-
    down process, with public officials and staff driving and controlling
    the process. Rather, they need to enable the broadest possible
    community of voices and viewpoints to be heard and to participate. This
    should also include private sector business people, who are often
    excluded from the public debates. After all, they are the ones who take
    many of the risks involved in implementing the growth plan. The goal is
    to achieve a community vision that balances as many needs and desires
    of the community as possible. This vision takes tangible form as public
    policy known as an adopted comprehensive plan. Elected officials then
    need to legislate the most effective structure for the efficient,
    timely, and cost-effective implementation of this public policy.
        Smart growth requires a smart process to fully implement what the
    community seeks from its smart growth public policy. When a landowner
    or any other citizen seeks to use their land or any other outcome in
    strict conformity to the provisions of the master plan/public policy,
    they have a right to expect a process that allows only directly and
    significantly affected parties to participate. Unforeseen and
    unexpected negative consequences of the proposed implementation need to
    be dealt with equitably. The benefits to the community and the
    applicant will be fidelity to the community's growth vision, the
    elimination of unnecessary risk and time, and significant cost savings
    to all parties, not the least being for taxpayers/consumers.
        A basic philosophical premise of smart growth should be that
    comprehensive plans be implemented, not nullified in piecemeal fashion
    through the development review process. Issues settled during the
    comprehensive plan debate should not be reopened for a period of time
    following adoption if the plan and the process are to be meaningful.
                              major disappointment
        At best, this is a complex document that requires a good deal of
    knowledge to even begin to use. A solid index is only a partial and
    incomplete solution. The cross-referencing list now included at the
    beginning of each chapter is a good start, but to make this work truly
    useful requires extensive cross-referencing within the text itself,
    section-by-section, subsection-by-subsection. This is a major but
    absolutely essential task for effective and complete use.
                        specific issues in the guidebook
        My objections and recommendations relate to the eight most critical
    areas of concern: standing and reopening of settled issues,
    supplementation of the record, sanctions on local government for
    failure to update plans, exhaustion of remedies, moratoria, vested
    rights, third-party initiated zoning petitions, and designation of
    critical and sensitive areas.
    Standing and Reopening of Settled Issues
        After embracing the traditional standard of ``aggrievement'' as the
    basis for standing to petition for judicial review of a land use
    decision (September 2001 Draft of the Guidebook, hereinafter
    ``September 2001 Draft''), the most recent draft (hereinafter, the
    ``October 2001 Draft'') inexplicably dilutes the definition of
    ``aggrieved'' and adds other options that effectively allow any person
    with any ax to grind to pursue a court challenge, whether or not he or
    she will actually suffer any special harm or injury, has appeared at or
    offered evidence during a public hearing, or even lives in the impacted
    community. This expansive approach to standing fundamentally alters the
    system now in place across the Nation, which requires a party
    challenging a land use decision to take part in the approval process
    and offer comments, to actually live in the community in question, and
    to demonstrate that the proposed use will cause special injury or harm
    to them over and above its impact upon the public generally. These
    liberal standing provisions will increase the amount of litigation that
    communities will face and it is more likely the government will be sued
    rather than a developer.
        The objectionable provisions of the Guidebook with respect to
    issues of standing seem to be motivated by a desire to be inclusive,
    that is, to apply a liberal standard that is easily met. Section 10-
    607(4) no longer includes an aggrievement test when determining who can
    petition the courts on a land use matter, and Section 10-607(5) is
    acknowledged in the commentary to afford standing to persons who
    haven't even participated in the agency's hearings. Perhaps this
    approach follows from the current trend of greater public participation
    in planning. I wholeheartedly support the idea of extensive public
    participation in planning. However, it does not follow from this that
    broad public participation in development review or in judicial review
    of site-specific development proposals is a good thing. On the
    contrary, such participation would be detrimental and open the door to
    undermining the work of the greater citizenry that helped to produce
    and articulate the broad public policy themes of the comprehensive
    plan. Liberal standards of public involvement are appropriate at the
    level of planning, policy, and broad regulatory enactments such as
    comprehensive zoning and zoning ordinance text amendments. But the
    standards should become stricter as we move down to levels of post-
    zoning implementation, such as site-specific project review, and
    judicial review.
        The public generally shares this view as evidenced by the
    overwhelming rejection of Amendment 24 in Colorado and of Proposition
    202 in Arizona in the November 2000, elections. A specific development
    proposal that is consistent with the comprehensive plan and development
    regulations is also consistent with the greater public's ``vision'' for
    the future. It does violence to this vision when we open the appeal
    process liberally to active special interests, no matter how well
    intentioned, and permit them to derail worthy projects that do not
    comport with their particular vision. A community cannot achieve its
    vision of ``smart growth'' without a smart process that preserves and
    protects its adopted vision from naysayers in the community.
        Major issues decided at the comprehensive planning and zoning
    stage, such as use, density or intensity, should not be revisited in
    the post-zoning site-specific proceeding unless the application does
    not comply with these decisions. It is critical that this principle be
    recognized in the Guidebook. Otherwise, there will be no protection or
    political cover for decisionmakers from the onslaught of entrenched
    growth opponents who reside in areas planned for growth. They could
    stop the proposed growth allowed in the Master Plan, oppose adopted
    public policy and create costly delays.
             legal analysis of the guidebook's approach to standing
         After previously acknowledging that ``aggrieved'' status
    (with the twin elements of special harm or injury distinct from any
    harm or injury caused to the public generally) should be the primary
    criterion in determining one's standing to petition for judicial review
    of a land use decision, the final draft Guidebook guts any such
    requirement. First, the definition of ``aggrieved'' in Section 10-101
    has been revised to make both ``special'' and ``distinct from any harm
    or injury caused to the public generally'' optional. The principal
    definition now requires merely an undefined generalized showing of
    ``harm or injury'' in order for one to have standing. (This is similar
    to the discredited ``may be prejudiced'' test advanced in prior drafts,
    and is also contrary to the understandings reached at the Directorate's
    final meetings on September 23-24, 2001.)
         Second, Section 10-607(4) now broadly allows ``all other
    persons'' who participated by right in an administrative review or who
    were ``parties to a record'' to seek judicial review without any
    showing of aggrieved status. This appears to be based upon comments by
    the Staff in an October 12, 2001, Memorandum to Directorate members
    suggesting that a showing of aggrievement on judicial review is
    unnecessary in a record appeal when the challenger has already been
    deemed to be aggrieved by the local government agency (October 12,
    2001, Memorandum, p. 5). This view is contrary to established legal
    precedent, since it is within the purview of the court (not the
    administrative agency whose decision is under review (to determine
    whether or not the challenger is aggrieved. The court's authority
    cannot be usurped by an agency determination regarding aggrieved
    status. See, e.g., Sugarloaf Citizens Assn. v. Department of
    Environment, 686 A.2d 605 (Md. 1996), discussing the difference between
    administrative standing before an agency and the requirement for
    standing to challenge the agency's decision in court. While the former
    rule is not very strict, ``judicial review standing'' requires that one
    be both a party before the agency and ``aggrieved'' by the agency's
    final decision (i.e., specifically affected in a way different from the
    public at large). Determination of judicial review standing is
    exclusively a judicial function and the court need give no deference to
    the agency's finding in this regard. Id. Section 10-607(4) is a legally
    flawed criterion, which effectively allows the administrative agency
    whose decision is under review to determine who shall be ``aggrieved.''
         Third, Section 10-607(5) allows ``any other person,''
    including persons who have skipped the agency proceedings altogether,
    to seek judicial review merely upon a showing that they are
    ``aggrieved'' under the expansive new definition of that term in
    Section 10-101.
         Treatise writers favor the traditional aggrievement
    standard. As can be seen from the following examples, the views
    expressed herein regarding Sections 10-101 and 10-607 (4) and (5) are
    shared almost universally by treatise writers and courts.

              L``Almost all State statutes contain the `person
            aggrieved' provision but only a minority extend standing to
            taxpayers . . . Under the usual formulation of the rule, third-
            party standing requires `special' damage to an interest or
            property right that is different from the damage the general
            public suffers from a zoning restriction. Competitive injury,
            for example, is not enough. This rule reflects the nuisance
            basis of zoning, which protects property owners only from
            damage caused by adjacent incompatible uses. Although the
            special damage rule is well entrenched in zoning law, a few
            courts have modified it. New Jersey has adopted a liberal
            third-party standing rule that requires only a showing of ``a
            sufficient stake and real adverseness.'' Daniel M. Mandelker,
            Land Use Law Sec. 8.02 at 337 (4th ed. 1997) (emphasis added)
            (citations omitted).
              LThe requirement that a person must be `aggrieved' in
            order to appeal from the board of adjustment to a court of
            record was originally included in the Standard State Zoning
            Enabling Act and has been adopted by most of the States. See
            Kenneth H. Young, Anderson's American Law of Zoning Sec. 27.09
            (4th ed. 1997).
              L``To be a person aggrieved by administrative
            conduct, it is necessary to have a more specific and pecuniary
            interest in the decision of which review is sought. A
            Connecticut court said that in order to appeal, plaintiffs are
            required to establish that they were aggrieved by showing that
            they had a specific, personal and legal interest in the subject
            matter of the decision as distinguished from a general interest
            such as is the concern of all members of the community and that
            they were specially and injuriously affected in their property
            or other legal rights.'' Id., Sec. 27.10 at 523-24 (Citations
            omitted.) (Emphasis added.)

         Case law in many jurisdictions is in accord with the
    special injury rule. See, e.g., Hall v. Planning Comm'n of Ledyard, 435
    A.2d 975 (Conn. 1980); DeKalb v. Wapensky, 315 S.E.2d 873 (Ga. 1984);
    East Diamond Head Ass'n v. Zoning Bd. Of Appeals of City and County of
    Honolulu, 479 P.2d 796 (Haw. 1971); Sugarloaf Citizens Ass'n v.
    Department of Env't, 686 A.2d 605 (Md. 1996); Bell v. Zoning Appeals of
    Gloucester, 709 N.E.2d 815 (Mass. 1999); and Copple v. City of Lincoln,
    315 N.W.2d 628 (Neb. 1982).
         In view of these and other long established precedents for
    establishing aggrievement as the standard for participating in the
    proceedings of local government agencies and thereafter, for
    challenging their decisions in court, it is disappointing that gaping
    loopholes have been inserted in the Guidebook that (a) allow persons
    who are not aggrieved to gain standing before agencies and thereafter
    in court to contest an agency decision (Sec. 10-607(4)), and (b) allow
    other persons, including adjacent residents (thus prima facia aggrieved
    (to bypass the agency proceeding altogether and hold their challenge
    for court (Sec. 10-607(5)).
                              recommended solution
    Avoiding Reopening of Settled Issues
        To avoid reopening issues settled in the adoption of a
    comprehensive plan, a ninth item should be added to Section 10-207
    (Record Hearings) to state that when any site specific development
    application is submitted for review under this section within 6 years
    of the adoption or amendment of the plan, major issues such as land
    use, density or intensity shall not be reargued or reconsidered. The
    only limited exceptions to this prohibition should be if the proposed
    use of the site is not in accordance with the plan, or if the density
    or intensity proposed for the site exceeds that in the plan and
    applicable zone.
        This is based on the sound premise that the site-specific
    proceeding should not become a forum to reopen debate on the
    community's already decided broad land use and growth policies. See J.
    Tryniecki, Land Use Regulation: A Legal Analysis and Practical
    Application of Land Use Law 323 (American Bar Assn. 1998).
    Standing to Seek Judicial Review
        Items (4) and (5) of Section 10-607 (Standing and Intervention)
    should be deleted and new Sections 10-607 (4) and (5) should be added
    to provide that only those persons who both participated in the record
    hearing and are aggrieved (i.e., will suffer special harm or injury
    distinct from that caused to the public generally) by the land use
    decision has standing to intervene in the land use decision.
                Supplementation of the Record
        In a proposal that closely mirrors expanded standing, an optional
    provision in the Guidebook would allow for expansion of the record by
    the court that hears a land use challenge. Parties would be able to
    introduce new studies, new testimony and new exhibits that were never
    made available to the local jurisdiction that issued the land use
    decision in the first place. Neither would the applicant have had an
    opportunity to challenge, verify, or modify them in a deliberative
    process. Such a proposal would turn courts into planning and zoning
    appeals boards, allowing them not only to second guess a local
    decision, but to make a decision entirely on their own with no
    deference to local concerns.
        In the final meeting of the Directorate, it was my understanding
    that the commentary would be modified to include a statement that
    remand is preferable to supplementation where the evidentiary record is
    inadequate. The statement added to the October 2001 Draft of the
    Guidebook leaves the issue ambiguous and open to interpretation that is
    destructively broad.
        Section 10-613 and the commentary preceding it address the pros and
    cons of courts supplementing the record. The commentary mentions such
    factors as time, fairness, cost, experience, etc. that should be
    weighed but neglects one very important consideration that I believe
    may override the others. That is the importance of maintaining a
    separation of power between the legislature and the judiciary. It is
    acknowledged that local legislative bodies may be subject to political
    pressure, but that is the essence of representative democracy. In our
    system of government, it is the job of legislative bodies to debate
    public policy and in the end to make decisions that reflect the
    dominant view. In contrast, the job of the judiciary in record appeals
    from decisions of local government legislative and administrative
    bodies is to review the decisionmaking process to ensure fairness, to
    see that the decision is in accordance with the law, and to review the
    record based upon a reasonableness standard (i.e. substantial evidence/
    nor clearly erroneous), but not to substitute its judgment for that of
    the local government decisionmaker.
        I believe subsections 10-613(1)(d) and 10-613(2) blur the
    distinction between the acts of local government legislatures and
    administrative bodies on the one hand and the judiciary on the other
    and permit the judiciary to usurp the proper role and powers of these
    bodies. Land use decisions are by nature political decisions, thus the
    proper places for the resolution of competing views are the local
    legislature, planning board, or board of appeals, not the courtroom.
    If, upon review of the record, it is found that the decisionmaker did
    not consider essential information, the judge should remand the case
    back to it with instructions to consider the missing information and
    then make the decision. In our view judges should strongly resist the
    urge to rule on the substantive merits of a land use controversy.
    Unlike other cases that come before a judge, there may be no ``right''
    or ``wrong'' in land use. Instead, the question is likely to be, ``what
    decision provides the greatest good for the greatest number?'' and that
    is the business of the local legislative body.
                    legal analysis of supplementation issues
         Courts conducting ``record reviews'' of land use decisions
    should exercise judicial restraint, particularly with respect to agency
    findings of fact on evidentiary matters, and should not allow the
    record to be supplemented with additional substantive evidence on
    appeal, or take other actions that would usurp the traditional
    authority of local government in the land use approval process. The
    Guidebook would broadly allow supplementation of the record by
    reviewing courts, a dangerous precedent as it would make the court--not
    the local government--the final decisionmaker in land use cases.?
         The most objectionable provision is Optional Section 10-
    613(1)(d), which states that a reviewing court ``may supplement the
    record with additional evidence'' if it relates to ``matters
    indispensable to the equitable disposition of the appeal.'' This is an
    open-ended invitation to abuse.
         Treatise writers and court decisions have narrowly
    construed the role of courts on judicial review.

              L``The local government, not the court, should be the
            final decisionmaker in land use cases. Generally, the judge's
            role in land use litigation is ``to provide a forum for serious
            and disinterested review of the issues, sharply limited in
            scope but independent of the immediate pressures which often
            play upon the legislative and administrative decisionmaking
            processes.'' Williams, American Land Planning Law Sec. 4.05 at
            100 (1988 Revision) (emphasis added).
              LHistorically, reviewing courts have emulated the
            Uniform Administrative Procedure Act by limiting their review
            of an agency action to the question of whether that action was
            arbitrary, capricious, unreasonable or illegal. Where the
            agency record is inadequate to support its action, the proper
            practice is to remand the matter to the agency for rehearing
            and redetermination. Carbone v. Weehawken Township Planning
            Bd., 421 A.2d 144 (N.J. Super. 1980). See also, Yokely's Law of
            Subdivisions Sec. 69(c) (2d ed. 1981). See also, Kenneth H.
            Young, Anderson's American Law of Zoning Sec. 27.29 at 605 (4th
            ed. 1997): (``Reviewing courts say they are not superzoning
            boards and that they will not weigh the evidence.'')

         These authorities and numerous other reported cases
    reflect the overwhelming consensus that an appellate court or a trial
    court should not be second-guessing an administrative finding.

              LFederal Circuit.--SFK USA Inc. v. United States, No.
            00-1305, 2001 WL 567509 (Fed. Cir. May 25, 2001) (Where an
            administrative agency defends its decision before reviewing
            court on the grounds it previously articulated, the court's
            obligation is clear: it reviews the agency's decision under
            Administrative Procedure Act (APA) and any other applicable
            law, and based on its decision on the merits, it affirms or
            reverses, with or without a remand. 5 U.S.C.A. Sec. 551 et
            seq.);
              LState Courts.--Numerous State courts, including
            courts in California, Connecticut, Maryland and Pennsylvania,
            hold that the scope of judicial review is narrow; that remand
            is the appropriate remedy when an agency has applied the wrong
            legal standard; and that the court should not substitute its
            judgment for that of the agency.

        Recommended Solution.--Delete optional Sec. 10-613(1)(d) and
    Sec. 10-613(2) as authority for a court to supplement the record.
    Sanctions for Inconsistency and Lack of Periodic Review
        The desire for some ``stick'' to compel local governments to comply
    with State statutes regarding consistency of regulations with plans and
    for periodic reviews of plans and regulations is understandable.
    However, I have made known my opinion on several occasions that the
    sticks proposed--voiding and loss of the presumption of reasonableness
    of local land development regulations--are poor ones. This approach
    unfairly jeopardizes the status of development approvals already issued
    or under review, threatens the stability of the land development
    process, and introduces unacceptable risk into development financing.
                     legal analysis of sanction provisions
         Unwise sanctions are imposed for failure of local
    governments to timely meet statutory milestones, i.e., failure to:

            adopt regulations consistent with the comprehensive plan
            (Sec. 8-104);
            review development regulations (Sec. 8-107);
            update development standards (Sec. 8-401); and
            record the comprehensive plan and regulations in the GIS Index
            (Sec. 15-202).

         Missing these milestones has the effect of making local
    government regulations or comprehensive plans ``void,'' ``voidable,''
    ``not effective;'' or subject to losing their ``presumption of
    reasonableness.'' These are strong terms with serious legal
    implications that can place the regulatory framework in legal limbo and
    undermine the process by which land development is reviewed and
    financed. The following statements illustrate why.

              L``We recognize the uncertainty and possible chaos
            that might accompany invalidation of the County's existing
            zoning scheme.'' Pennington County v. Moore, 525 N.W.2d 257,
            260, n.3 (S.D. 1994).
              LVoid conditions are subject to collateral attack at
            any time. Elkhart County Bd. of Zoning Appeals v. Earthmovers,
            Inc., 631 N.E.2d 927, 931 (Ind. Ct. App. 1994); Sitkowski v.
            Zoning Bd. of Adjustment of Borough of Lavalette, 569 A.2d 837
            (N.J. Super. Ct. App. Div. 1990).
              LAvoidable provision is ``valid until annulled and is
            ``capable of being affirmed or rejected at the option of one of
            the parties.'' Black's Law Dictionary 1569 (1979).
              L``The importance of the presumption [of validity] is
            that it formally fixes the responsibility for planning policy
            in the legislature, and prompts a reviewing court to exercise
            restraint. Anderson's American Law of Zoning Sec. 3.13 at 117
            (4th ed. 1996).
              LChing v. San Francisco Bd. of Permit Appeals (Harsch
            Inv. Corp.), 60 Cal. App. 4th 888 (Cal. Ct. App. 1998) (statute
            imposed 90-day limitations period for attacking a local zoning
            decision).

                    L``The clear legislative intent of this statute is to
                    establish a short limitations period in order to give
                    governmental zoning decisions certainty, permitting
                    them to take effect quickly and giving property owners
                    the necessary confidence to proceed with approved
                    projects.'' Id. at 893. (Emphasis added.)

         The October 2001 Draft has addressed these concerns with
    respect to Section 8-107. However, the same defects in Sections 8-104,
    8-401, and 15-202 remain unaddressed.
        Recommended Solution: The section entitled Consistency of Land
    Development Regulations with Local Comprehensive Plan states that
    actions not consistent with the comprehensive plan shall be voidable.
    This section should not provide that a failure to comply with
    timeframes for updating comprehensive plans will affect the validity of
    any land development regulation or land use action of the local
    government.
        The Section on Uniform Development Standards should not provide
    that the failure of State planning agencies to conduct a timely general
    review and report of uniform development standards will result in the
    standards loosing their presumption reasonableness. This section should
    state that failure to file a timely report as required by this section
    shall not affect the validity or presumption of reasonableness of
    existing uniform development standards, nor of permits issued pursuant
    to such standards.
        Section 15-202 (Recordation Requirements) should not suggest that
    the failure to comply with recording requirements will render
    comprehensive plan, subplans, and land development regulations ``not
    effective.'' Instead, this section should state that the failure to
    comply with the recording requirements of this Chapter shall not affect
    the validity, effectiveness or presumption of correctness of any plan
    or land development regulation.
    Exhaustion of Remedies
        An essential element of smart process is a means of establishing
    when the approval process has run its full course and a land
    development decision is final. If the decision process is open-ended
    and lacks closure, then it is also unpredictable. Unpredictability adds
    delay and risk, and the costs associated with risk and delay are
    ultimately paid by consumers as well as by taxpayers.
        I applaud the authors of the Guidebook for the needed and
    progressive reform proposed in Section 10-603 on the finality of land
    use decisions. Unfortunately, this important reform is contradicted and
    negated by the provisions of Section 10-604, Exhaustion of Remedies. To
    support the provisions on finality the Guidebook should have provided
    here for streamlined qualification for appeals and made clear that in
    normal circumstances an applicant need only apply for remedies that are
    actually available. The Guidebook also fails to consider and include
    among its criteria for finality important guidelines from the Supreme
    Court's recent decision in Palazzolo v. Rhode Island.
                  legal analysis of administrative exhaustion
         The well-conceived ripeness reforms (Sec. Sec. 10-201, 10-
    202, 10-203, 10-210, and 10-603) may have been undone by overly complex
    requirements for exhaustion of remedies. The Model requires an
    applicant to exhaust three additional remedies after the initial agency
    decision before seeking judicial review (Sec. 10-604). (This has always
    been a ``ripe'' area for abuse of process.)

              LUnless the administrative remedy is futile or
            inadequate, applicants must:

               Lappeal for administrative review (Sec. 10-209);
               Lapply for a conditional use (Sec. 10-502); and
               Lseek a variance (Sec. 10-503).

              LExhaustion of these ``remedies'' could add years to
            the review process and effectively gut the ripeness reforms.
            This, on top of a growing trend in State courts to apply the
            draconian ripeness standards used in Federal courts. See Daniel
            R. Mandelker, Land Use Law Sec. 8.08.10 (4th ed. & Supp. 2000).
            Professor Mandelker, although a self-described ``regulatory
            hawk'', has long been a critic of abusive practices in agencies
            and courts regarding the finality doctrine as espoused in
            Williamson County Regional Planning Commission v. Hamilton
            Bank, 473 U.S. 172 (1985). See Testimony of Daniel R. Mandelker
            regarding H.R. 1534 before the House Judiciary Committee,
            Subcommittee on Courts and Intellectual Property, September 25,
            1997. See also Amicus Brief of the American Planning
            Association in Suitum v. Tahoe Regional Planning Agency, 117 S.
            Ct. 1659 (1997). This portion of APA's brief was later
            ``repudiated'' by APA in its testimony to Congress opposing
            H.R. 1534. See letter of September 16, 1997, from APA
            President, Eric Damian Kelly, to the Honorable Henry J. Hyde,
            Chair, House Judiciary Committee. These practices have made it
            virtually impossible for Fifth Amendment Takings claimants to
            gain access to Federal courts. See J. Delaney and D. Desiderio,
            Who Will Clean Up The Ripeness Mess? A Call for Reform so
            Takings Plaintiffs Can Enter the Federal Courthouse, 13 Urb.
            Law. 195 (1999).
               LPublic agency abuse of the land use review process has long
            been a concern. An excellent discussion and compilation of some
            of the numerous commentaries on this serious problem may be
            found in the June 2001 issue of Zoning and Planning Law Report.
            See Rodney L. Cobb, Land Use Law: Marred by Public Agency
            Abuse, Zoning and Planning Law Report, Vol. 24, No. 6.
         Palazzolo: The Supreme Court's Latest Statement on
    Ripeness
        In Palazzolo v. Rhode Island, 121 S.Ct. 2448 (2001), which is not
    mentioned in the October 2001 Draft's commentary on Section 10-604, six
    members of the U.S. Supreme Court provided important direction on the
    issue of ripeness. The Court stated:

            L``While a landowner must give a land-use authority an
            opportunity to exercise its discretion, once it becomes clear
            that the agency lacks the discretion to permit any development,
            or the permissible uses of the property are known to a
            reasonable degree of certainty, a takings claim is likely to
            have ripened.''

        Recommended Solution.--At the final meeting of the Directorate, I
    understood that the final draft would be amended to add that an
    applicant should not have to seek approval of a conditional use when
    such a use would not be practical for the applicant. Instead, Section
    10-604(1) uses the more ambiguous term ``applicable'' regarding both
    conditional uses and variances. The explanatory language states that
    ``if there is no conditional use provision applicable to the property''
    as zoned, the applicant does not have to seek a conditional use before
    commencing judicial review. This is not the problem I was concerned
    about. For example, an applicant seeking approval of a 10-lot
    residential subdivision would not be interested in having to file for a
    group home or medical clinic--even if available in the zoning
    ordinance. To avoid abuse and unnecessary filing of applications, as
    discussed in Palazzolo, Section 10-604(1) should be revised to delete
    the requirement to seek approval of a conditional use (as provided in
    Sec. 10-502) and to limit the exhaustion requirement to a practical
    remedy, which might be either an appeal for administrative review
    (Sec. 10-209) or filing for a variance (Sec. 10-503).
    Moratoria
        Moratoria are indicators of planning failure. Clearly, absent some
    catastrophe or unforeseeable event, a reasonable planning process
    should not lead to a pass where growth is brought to a stop by fiat.
    But, catastrophes and unforeseen events do occur from time to time, and
    the law in most States allows for temporary moratoria to protect public
    health and safety. However, when the difficulty arises because of a
    failure to plan or inadequate planning, those responsible should not
    escape the consequences of their failure. Nor should the building
    industry and housing consumers suffer from the failure of others to do
    their jobs properly.
        It is recognized that local communities are often challenged by the
    impacts of growth, particularly impacts on infrastructure. That is why
    it is so important to plan for infrastructure at the same time the
    community is planning for the expansion of population, jobs, and
    housing. While it is one thing to create a plan for the provision of
    public facilities, it is another thing to finance and implement that
    plan. Not every community does a good job getting infrastructure built.
    Other spending priorities and pressure to keep taxes low make it
    difficult to keep up with infrastructure demands. Nonetheless, getting
    infrastructure built is a public sector responsibility. It is too easy
    to use moratoria to escape this responsibility.
        The October 2001 draft deletes the provisions in the Guidebook that
    would have permitted moratoria to be imposed on the grounds of ``any
    significant threat to the . . . environment,'' and in lieu thereof
    inserts protection of the ``general welfare'' as an additional ground
    for imposing moratoria. While ``general welfare'' is an improvement
    over singling out ``the environment'' as one element of public policy
    that should be allowed to trump other pressing public needs, such as
    affordable housing and jobs, it is a broad standard that can be used to
    allow moratoria to be imposed for virtually any reason. At the final
    Directorate meeting, it was agreed that the ``or the environment''
    standard would be excised wherever it appeared in the Guidebook. This
    has apparently not been done. See, e.g., optional Sec. 8-604(4), which
    was the section under discussion, let alone other possible sections in
    the Guidebook.
        The Guidebook also permits moratoria while the government prepares,
    adopts or amends comprehensive plans, historic preservation plans or
    land development regulations, absent any looming threat to public
    health or safety (Section 8-604 (3)(b) and (c)). The provisions for
    potentially indefinite, open-ended moratoria (see for e.g., Sections 8-
    604(3)(b) under Alternative 2, 8-604(8) and 8-604(10)) are
    inappropriate. Moratoria should be for a definite, fixed period, in no
    case to exceed 1 year.
        Moratoria are serious, last-resort measures that should be
    judiciously applied. When the legal criteria for moratoria are
    difficult to satisfy, an incentive is created to plan more carefully.
    The whole point of the Growing Smart exercise is to change and improve
    the level of planning, and incentives have a role in bringing that
    about.
        Accordingly, a strict standard of ``danger to public health and
    safety'' that must be established before a moratorium may be declared
    would be fitting. This standard, observed by several States, reflects a
    public policy that moratoria are serious matters not to be used as a
    convenience, but as a last resort. While a moratorium may stop the
    issuance of development permits, it has no effect on housing demand.
    Its effect may thus be to direct growth outside the boundaries of the
    government that declared the moratorium and thereby contribute to
    sprawl. For this reason, States may wish to limit local governments'
    power to use this tool by adopting a strict standard. In addition,
    States may wish to adopt a strict standard to ensure that local
    governments take seriously their responsibility to plan for and build
    infrastructure. If the standards for use of moratoria are set too low,
    then there is less incentive to do a good job of planning. With proper
    planning, most conditions that might give rise to use of moratoria
    should be avoidable. In rare cases, where even good planning cannot
    prevent an unforeseen danger to public health and safety, the statutory
    language in this alternative would permit limited use of a moratorium.
                     legal analysis of moratoria provisions
        The Guidebook authorizes moratoria on a virtual open-ended basis
    (up to 1.5 years or more), and ``planning moratoria'' (up to 2 years or
    more) are also authorized (Sec. 8-604). In addition, no meaningful
    restrictions on moratoria are provided in designated growth areas.
         In designated Smart Growth areas, moratoria should be:

              Llimited to circumstances in which a serious threat to public
            health or safety exists;
              Llimited as to duration; and
              Lthe government entity imposing the moratorium should be
            required to immediately address and resolve the problems giving
            rise to the moratorium. See Westwood Forest Estates v. Village
            of S. Nyack, 244 N.E.2d 700 (N.Y. 1969).

         Moratoria are not part of the planning and zoning process.
    Rather, they are often the result of a failure to properly plan.

              L``Planning moratoria'' should generally be
            prohibited or severely limited.

              L``Even construing the provisions of the [enabling act]
            liberally, we find that the power to enact a zoning ordinance,
            for whatever purpose, does not necessarily include the power to
            suspend a valid zoning ordinance to the prejudice of a land
            owner . . . More significantly, the power to suspend land
            development has historically been viewed in this Commonwealth
            as a power distinct from and not incidental to any power to
            regulate land development. Accordingly, as the [enabling act]
            is silent regarding land planning through the temporary
            suspension of development, we decline to condone a
            municipality's exercise of such power.'' Naylor v. Township of
            Hellam, 773 A.2d 770 (Pa. 2001) (emphasis added).

         Moratoria raise takings issues as well. See D.R. Mandelker
    and J.M. Payne, Planning and Control of Development, Cases and
    Materials 642 (5th ed. 2001).
         Significantly, on June 28, 2001, the U.S. Supreme Court
    granted certiorari in the case of Tahoe-Sierra Preservation Council v.
    Tahoe Regional Planning Agency, 228 F.3d 998 (9th Cir. 2000), cert.
    granted, 121 S.Ct. 2859, 150 L. Ed. 2d 749 (U.S. June 28, 2001).
    Certiorari was granted on the question ``[w]hether the Court of Appeals
    properly determined that a temporary moratorium on land development
    does not a constitute a taking of property requiring compensation under
    the takings clause of the United States Constitution.''
        Recommended Solution.-- Delete Alternative 1 in Sec. 8-604(3), as
    it would authorize moratoria to be imposed for virtually any reason.
        Delete Alternative 2 in Sec. 8-604(3), particularly Sec. Sec. 8-
    604(3)(b) and (c), allowing planning moratoria of 2 years (or more).
    Planning moratoria should not be allowed, and if allowed, should never
    exceed 6 months.
        Revise Sec. 8-604(8) to limit extensions of moratoria (other than
    planning moratoria, which should not be extended (to not more than one
    6-month period, and only upon a finding of ``compelling need'' as
    defined in Sec. 8-604 Alternatives (2)(d) and (3)(b).
        Delete Sec. 8-604(10)(a) and (b) which allow State or local
    governments to impose additional ``temporary moratoria'' upon already
    issued permits or to adopt ``temporary policies'' against approving
    zoning map amendments. Alternatively, these additional restrictions
    should only be imposed upon a finding of ``compelling need'' as defined
    in Sec. Sec. 8-604(2)(d) and (3)(b).
    Vested Right to Develop
        Traditional late vesting rules in effect in most States are out of
    date and unfair. These require issuance of a building permit and
    commencement of construction (or other acts of reliance) in order for
    rights to vest. Late vesting rules do not recognize the complexity of
    the modern regulatory environment, or the difference between a single
    building project on the one hand, and long-term land development or
    multi-building projects on the other. Statutory reform is urgently
    needed in this area and the Guidebook has taken steps to provide it.
    Vesting of development rights should be recognized earlier in the
    process, such as at the time of subdivision or site plan approval, or
    at the time of filing of a complete application for subdivision/site
    plan approval.
        A legally vested right to develop land is essential to the
    stability of development processes and real estate markets. The
    Guidebook, in Section 8-501, provides two alternatives. The first
    alternative is a vesting model that establishes a vested right to
    develop (which includes design, planning and preparation of the land
    for development, as well as construction) as soon as a complete
    development application is filed. The second alternative has been
    modified from the previous second alternative that required the
    issuance of a permit and ``substantial and visible construction'' to
    one that allows vesting based upon ``significant and ascertainable
    development'' pursuant to a development permit. This is much more
    equitable than the original second alternative since it appears to
    recognize expenditures (and other acts of reliance) based on the
    development of the property, rather than merely on construction of one
    or more buildings. The development process, from design to approval to
    construction, is significantly more complex today than it was 50 years
    ago.
        Although the proposed first alternative allowing vesting to occur
    upon submission of a complete application is laudable and is recognized
    in some States, it may be more reform than some other States are
    willing to undertake. Thus, the second alternative proposed in the
    October 2001 Draft is also appropriate if it is interpreted as
    recognizing vested rights based upon development work pursuant to
    appropriate approvals, rather than upon construction of a building or
    buildings pursuant to a building permit. (See Legal Analysis.)
                      legal analysis of vesting provisions
         In today's world, the land use regulatory process has
    become increasingly elongated and complex, with environmental
    permitting often overlaying the traditional review process, regulations
    proliferating, more reviewing agencies in the mix, and more public
    hearings. All of these factors, and the increasing uncertainty that
    accompanies them, have led to a serious problem, particularly for long-
    term, multi-building projects, which must receive many development
    approvals before the first building permit is obtained. The design and
    approval phases of any development, particularly one which involves
    multiple buildings, is time consuming and expensive. Before a single
    footing is poured, architects and experts must be hired, attorneys
    retained, engineering started, a series of regulatory systems
    navigated, equipment leased, materials ordered, financing arranged and
    site development work commenced. Thus, it is appropriate that
    ``development'' activity pursuant to government approvals, and not
    merely ``construction'' of a building or buildings pursuant to a
    building permit, be the criterion for recognizing vested rights.
         However, it must be noted that the Guidebook's definition
    of ``development permit'' lists a number of approvals, including a
    ``building permit'' (Sec. 10-101), could be interpreted to apply solely
    to a building permit. If this were to be the interpretation, the
    language would have the exact opposite effect of what was intended,
    which was to suggest an early vesting rule that recognizes the huge
    expense and commitments required to prepare a development plan and
    proposal. Thus, the revised second alternative in Section 8-501, if it
    were to be interpreted to be applicable only to a building permit,
    could also be construed as authorizing a late vesting rule (similar to
    the common law vesting rule in effect in approximately 30 States (that
    would not confer vested status on a project until after a building
    permit has been issued and significant and ascertainable construction
    thereunder has occurred. This would be a draconian imposition of the
    rule in today's multi-layered regulatory environment because it ignores
    the often numerous development approvals that a project may have
    previously received and implemented. If applied in this manner, the
    revised section relating vested status to significant and ascertainable
    development pursuant to a development permit would not affect
    meaningful reform and instead would only embalm the status quo.
    (Unfortunately, the Guidebook's definition of ``development permit''
    does not include preliminary subdivision plans.)
         Approximately 12 States have enacted vesting laws, several
    of which recognize one's right to proceed with development under the
    law in effect at the time of approval of a site-specific application,
    such as a preliminary subdivision plan. Other States' laws (e.g.,
    Connecticut) allow vesting even earlier, such as at the time of
    submission of the initial development application. Both of these
    approaches are reasonable.
         Maryland is cited in the Guidebook as a primary source of
    the late vesting rule, which is as it should be, since Maryland's
    ``very late'' vesting rule is among the most inflexible in the country.
    Indeed, Maryland courts have not recognized vested rights under this
    rule even in circumstances where the landowner's failure to acquire the
    requisite building permit and commence construction is the result of
    previously adjudicated or acknowledged unlawful conduct of the
    government. See, e.g., Sycamore Realty Co. Inc. v. People's Counsel of
    Baltimore County, 684 A.2d 1331 (Md. 1996); Rockville Fuel & Feed Co.
    v. Board of Appeals, 291 A.2d 672 (Md. 1972).
        Recommended Solution.--Retain Alternative 1 and revise Alternative
    2 to clarify that vesting upon commencement of ascertainable
    development does not require that the project must have received a
    building permit. Amend the definition of ``development permit'' in
    Section 10-101 to include preliminary subdivision plans or plats.
    Commonly, most of the detailed (and expensive) engineering design work
    must be accomplished in preparation at the preliminary plat stage.
    Third-party Initiated Zoning Petitions
        I strongly object to subsections 8-103(1)(d) and (e), which allow
    new land development regulations (and zoning changes) to be initiated
    either by petition of owners of record lots constituting ``51 percent
    of the area that is to be the subject of the proposed ordinance,'' or
    by petition of a stated minimum number of ``bona fide adult residents
    of the local government [sic].'' At the final Directorate meeting, it
    was indicated that the text would include a statement that petitions of
    this nature should be disfavored.
        The language that has been added does not adequately convey that
    the initiative process is extremely destabilizing to orderly planning
    and social equity and undermines settled planning and zoning decisions.
    It is all the more so when it can be accomplished by a mere plebiscite
    of a neighborhood. Neighborhood plebiscites to effect zoning changes
    are unlawful in many States. See, for example, Benner v. Tribbit, 57
    A.2d 346 (Md. 1948). There is an excellent discussion of this problem
    in the case of Township of Sparta v. Spillane, 312 A.2d 154 (N.J.
    Super. 1973). The fact that a minority of States authorizes the
    initiative process through their constitutions or State enabling laws
    by no means establishes the wisdom of this process, or its value in
    achieving the goals of Smart Growth. It is helpful that the final draft
    has been amended to recognize this point.
                 legal analysis of third party zoning petitions
         The Guidebook acknowledges that some States authorize land
    development regulations to be initiated:

              LBy 51 percent or more of record lot owners ``in the
            area that is to be the subject of the proposed ordinance''
            (Sec. 8-103(1)(d)), or
              LBy ``petition of a minimum percentage of bona fide
            adult residents'' of the jurisdiction (Sec. 8-103(1)(e)).
        Allowing local land use regulations to be enacted via voter
    initiative or by a neighborhood plebiscite can completely destabilize
    the land use regulatory process and promote exclusionary zoning. The
    fact that the local legislative body would make the final decision
    regarding enactment of the proposed legislation does not ameliorate the
    mob hysteria that often accompanies such initiatives. See, e.g., City
    of Eastlake v. Forest City Enterprises, 426 U.S. 668 (1976), United
    States v. City of Black Jack, 508 F.2d 1179 (8th Cir. 1974), cert den.,
    422 U.S. 1042 (1975). Neighborhood plebiscites are often used to affect
    the civil rights or property rights of others.
         Of course, initiatives that are authorized by State
    Constitutions are likely beyond the reach of remedial legislation.
    However, the Model should not encourage the use of initiatives as they
    have been almost universally criticized as antithetical to good
    governance and good planning. See, e.g., David Broder, Democracy
    Derailed--Initiative Campaigns and the Power of Money (Harcourt)
    (author is a senior columnist for the Washington Post).
         Criticism of the initiative as a tool for planning and
    zoning has been particularly harsh and widespread. See, e.g., Nicholas
    M. Kublicki, Land Use by, for, and of the People: Problems with the
    Application of Initiatives and Referenda to the Zoning Process, 19
    Pepp. L. Rev. 99, at 104, 105, 155, 157-158 (1991).
         Courts have been equally suspicious of the initiative and
    referendum. See, for example:
            LTownship of Sparta v. Spillane, 321 A.2d 154, 157 (N.J. Super.
            1973) (``Among other things, the social, economic, and physical
            characteristics of the community should be considered. The
            achievement of these goals might well be jeopardized by
            piecemeal attacks on the zoning ordinances if referenda were
            permissible for review of any amendment. Sporadic attacks on a
            municipality's comprehensive plan would tend to fragment zoning
            without any overriding concept.''). To the same effect are:
            Benner v. Tribbit, 57 A.2d 346, 353 (Md. 1948); Leonard v. City
            of Bothell, 557 P.2d 1306, 1309-10 (Wash. 1976); City of
            Scottsdale v. Superior Court, 439 P.2d 290, 293 (Ariz. 1968).
        Recommended Solution.--Delete Sec. 8-103(1)(d) authorizing
    ordinance text and map amendments to be ``initiated'' by 51 percent of
    the owners of lots of record in ``the area'' that is to be the subject
    of the proposed ordinance, and replace it with a new Sec. 8-103(1)(d),
    which would allow owners of lots of record to apply to the local
    government legislature for regulatory relief in situations affecting
    their property or the general community. The local government would
    retain the discretion whether to accept or consider the amendment
    application.
        Of course, a landowner's right to seek redress of a site-specific
    problem through legislation (such as a zoning text amendment) would not
    absolve the local government from evaluating the proposed amendment on
    the basis of whether it would promote the health, safety, and welfare
    of the general public.
        Similarly, optional Section 8-103(1)(e), authorizing a specified
    percentage of adult residents of the local government to petition for
    ordinance amendments, should be deleted. If a single category, or a
    group of citizens, have a meritorious case for amending an ordinance,
    they can pursue it under Sec. Sec. 8-103(1)(a), (b) and (c) by
    convincing their legislative body or planning agency of the merits of
    their proposal. If they are dissatisfied with the outcome, they can
    voice their displeasure in the next election.
    Designation of Critical and Sensitive Areas
        The Guidebook defines ``critical and sensitive areas'' as those
    areas that contain or constitute natural resources sensitive to
    excessive or inappropriate development. (Section 9-101(3)(c)). This
    definition is extremely broad. All areas can contain or constitute some
    natural resource. Certainly, any undeveloped property could easily be
    categorized as containing or constituting a ``natural resource.'' In
    fact, no definition of ``natural resource is provided within the text.
    Furthermore, the Guidebook definition refers to ``excessive or
    inappropriate development'' but does not attempt to define what these
    terms mean. Without a clear, concise definition, any development could
    be identified as ``excessive or inappropriate.'' Such lack of clarity
    or of any definition altogether could easily allow a local government
    to restrict any type of development in any area.
        The Guidebook language provides that local governments can opt out
    of adopting regulations for critical/sensitive areas if all critical/
    sensitive areas in their jurisdiction are designated as areas of
    ``state'' critical concern (Section 9-101(1)). However, just as
    importantly, the local government should be able to avoid adopting
    regulations for critical/ sensitive areas that have been designated as
    ``critical'' by the Federal Government. For example, the U.S.
    Endangered Species Act of 1973 (ESA) requires the Federal Government to
    designate ``critical habitat'' for endangered or threatened species.
    The ESA provides extensive protection of ``critical habitat.'' The ESA
    requires an applicant to apply for a permit from the Fish and Wildlife
    Service (FWS) or National Marine Fisheries Service (NMFS) if their
    action will likely impact an endangered or threatened species (which
    would likely occur in an area designated as critical habitat). The Act
    also requires projects within critical habitat, needing a Federal
    permit, approval or funding to go through a consultation process with
    FWS or NMFS. If the outcome of the consultation determines that the
    activity will likely adversely affect the survival and recovery of the
    species, the applicant will be required to minimize or mitigate the
    impacts of the activity.
        Recommended Solution.--Provide a definition for ``natural
    resources'' similar to the following: natural resources are plants,
    animals, or useful minerals indigenous to a specific site that provide
    benefits not only to the owner of the site but to the public generally
    and that the exploitation of which would have a detrimental effect on
    the public welfare.
        Amend the definition of ``critical and sensitive areas'' to
    include: lands and/or water bodies containing natural resources and/or
    which are themselves natural resources the exploitation of which would
    cause a threat to the public health, safety, or welfare.
        Provide a definition for ``excessive or inappropriate development''
    similar to the following: excessive or inappropriate development is
    grading, construction, or site disturbance that is unlawful or not in
    compliance with duly adopted regulations or not in compliance with duly
    issued permits.
        Provide in Section 9-101(1) and/or in Section 7-202 (5) an opt-out
    provision for lands designated as ``critical'' by the Federal
    Government.
                                   conclusion
        While many of my comments have been frankly critical, hopefully
    they will be perceived as constructive in their intent. Stuart Meck,
    his able staff, and important outside consultants have produced an
    impressive and very useful piece of work. The thoughtful and diligent
    work of a dedicated Directorate who read and commented extensively and
    constructively on literally thousands of pages of text is not to be
    overlooked. That the Guidebook can and should be made better is not a
    detraction of the work as it stands, but rather on the broad scope and
    great complexity of the undertaking. I consider it a privilege and a
    great learning opportunity to have been allowed to work on the Growing
    Smart Directorate.
                                   __________
        Statement of Don Chen, Executive Director, Smart Growth America
        Mr. Chairman, Ranking Member Smith, and Members of the Senate
    Committee on Environment and Public Works, thank you for holding
    today's hearing on Smart Growth.
        I am the Executive Director of Smart Growth America, a nationwide
    coalition of more than 70 organizations, including the Enterprise
    Foundation, the League of Women Voters for Smart Growth, American
    Farmland Trust, Natural Resources Defense Council, and the National
    Low-Income Housing Coalition. Together, we promote smart growth, a
    strategy of development that makes efficient use of natural resources
    and infrastructure, revitalizes neighborhoods, keeps housing
    affordable, protects farmland and open space, and provides people with
    more transportation choices.
        Smart Growth is a local issue that is driven by decisions made by
    individuals and families. These include everything from a developer's
    decision to build a variety of residential, commercial and retail
    buildings near a transit station to a farmer or rancher's decision to
    sell development rights to boost the viability of working his land.
        Land use decisions are made locally, so many people naturally ask
    the question, is there a Federal role in smart growth? The answer--
    unequivocally--is yes. Local and individual land use decisions are
    influenced by incentives and policies that have been made at the local,
    State and Federal levels. The Federal Government has had an enormous
    impact on development patterns for decades, if not centuries. A 1999
    Fannie Mae Foundation survey of leading urban scholars found the
    Interstate Highway System and the Federal Housing Administration's home
    mortgage insurance program to be ranked as the top two influences in
    shaping American cities and metropolitan development during the past
    half century.
        The Federal Government has affected development patterns in the
    past, and will continue to do so in the future. The real question is,
    what is the appropriate role? There are four functions.
        First, the Federal Government should share information about best
    practices, decisionmaking tools, and research. State and local
    governments do not have the capacity to identify, analyze or develop
    tools, such as complex predictive computer models or urban planning
    software, nor should they need to reinvent the wheel in search of
    practices and policies that will allow them to use their economic and
    natural resources more efficiently.
        Federal agencies can assist States and communities by disseminating
    information such as the Department of Housing and Urban Development's
    new report on modern rehabilitation codes, entitled Smart Codes in Your
    Community: A Guide to Building Rehabilitation Codes (August 2001). The
    report identifies and analyzes State innovations that have yielded
    substantial smart growth benefits. For example, in 1997 the State of
    New Jersey worked with developers, firefighters, building inspectors
    and environmental groups to adopt a ground-breaking rehabilitation code
    to encourage the renovation of decaying buildings. This new code was
    necessary because in the past, rehabilitation codes were mainly derived
    from inflexible new construction standards, which often required
    unreasonable overhauls of older buildings. Within a year after these
    new codes were adopted, rehabilitation investment statewide rose by 8
    percent. In the cities of Newark, Jersey City and Trenton, spending
    increased by 60 percent, 83 percent and 40 percent, respectively. Gains
    in Newark totaled $41 million. The strategy was so successful that
    other States, such as Maryland, are following suit. The HUD report
    catalogues these emerging building rehabilitation codes to help other
    States and localities address the widespread problem of decaying or
    abandoned properties, a top priority for HUD Secretary Mel Martinez.
        Rehabilitation codes and other smart growth tools are already being
    used nationwide to help communities make decisions on how their
    communities can grow. For instance, PLACE3S (Planning for
    Community, Energy, Economic, and Environmental Sustainability) is a set
    of predictive computer models developed by the Department of Energy
    that helps communities understand how their growth and development
    decisions can lead to better economic, community, and environmental
    outcomes. It integrates planning, design, and quantitative measurement
    into a public involvement process that is appropriate for both regional
    and neighborhood-scale planning. PLACE3S evaluates how
    efficiently a community integrates land uses, provides housing and
    jobs, transports people and materials, allocates public infrastructure
    improvements, and uses other resources. It has proven to be an
    invaluable component of many recent transportation and land-use
    planning projects across the U.S. and is increasingly in demand.
        For example, the city of Salem, Oregon is creating a city-wide
    preferred growth strategy using the PLACE3S model. The city
    held a series of workshops to apply three land use scenarios throughout
    Salem and analyze their impacts on nine neighborhoods. Workshop
    participants were asked to create a number of alternative land use
    scenarios that met a target range of housing and employment densities
    that matched the city's vision and principles for future population
    growth. The PLACE3S model was used interactively to adjust
    the new scenarios in real time, compare them against existing land uses
    and current zoning for each geographic location, and then analyze the
    potential ``livability'' of a new land use alternative based on a
    predefined set of community indicators, such as jobs/housing balance,
    annual vehicle miles traveled (VMT) and air pollution costs.
        In Lancaster County, Pennsylvania, several communities are
    currently engaged in a strategic community planning process to create a
    regional comprehensive plan that addresses the future of their
    communities. CommunityViz, a software tool developed by the Orton
    Family Foundation, allows planners, landowners, and interested citizens
    to create and manipulate a virtual representation of a town, and
    explore different land use scenarios and make informed decisions on
    issues that affect their quality of life.
        Mr. Chairman, I understand that you are interested in developing
    legislation to catalogue community decisionmaking and visualization
    tools and provide assistance to communities wishing to employ such
    tools. Smart Growth America would welcome the opportunity to work with
    you in that effort.
        Second, the Federal Government should provide financial assistance
    to States and localities to enable them to invest in practices and
    policies that they believe are in the best economic and environmental
    interest of their citizens. A tangible example of the Federal
    Government's valuable role was a recent grant that the EPA provided to
    the Envision Utah project, which enabled residents of the Greater
    Wasatch Area to deploy state-of-the-art demographic projection and land
    use mapping techniques to better plan for future growth. Using long-
    range planning and visioning tools, project leaders determined that
    continued sprawling, low-density development would result in a doubling
    of the Greater Wasatch Area's urbanized land area. They estimated that
    a smarter growth scenario featuring major investments in public transit
    would save 171 square miles of open space, reduce the amount of driving
    by 2.4 million miles per day, decrease commute times by 5.2 percent,
    increase average speeds by 12.5 percent, and save the region $4.6
    billion in infrastructure costs. Under the leadership of Governor Mike
    Leavitt, the region is now pursuing the attainment of these smart
    growth outcomes, which will likely include infrastructure savings for
    the Federal Government as well as broad environmental benefits.
        Third, the Federal Government should support smart growth
    innovations that give local governments more flexibility in meeting
    Federal requirements. A great example that merits replication is the
    Atlantic Station development in Atlanta, Georgia, which applied smart
    growth principles to meet Federal air quality standards. To be built on
    the site of the old Atlantic Steelworks, this 138-acre mixed-use
    transit-oriented development project had the misfortune of requiring a
    small bridge to improve connectivity with the region's transit and road
    network at a time when Atlanta was under a federally mandated
    moratorium preventing investment in such infrastructure. The moratorium
    was the result of Atlanta's lapse in Federal air quality conformity-a
    necessary step to protect the public health. However, at the request of
    the developer, the EPA's technical staff determined that the site's new
    neighborhood would in fact reduce regional travel by 50 million miles
    per year because of its excellent public transit access, walkability,
    and compact street design. In addition to reduced traffic, the project
    is expected to decrease air pollution and its innovative stormwater
    management system will reduce the volume of polluted runoff. The
    project's smart growth benefits enabled the bridge construction to go
    forward and led to EPA's official guidance that allows smart growth
    developments to qualify as Transportation Control Measures under the
    Clean Air Act.
        Fourth, the Federal Government should get its own house in order so
    that its activities support States and localities in their efforts to
    pursue smarter growth. The Federal Government has a major presence in
    communities all across America, and its daily operations should not
    interfere with State or local efforts to encourage smart growth. This
    ranges from the location and design of Federal facilities, including
    disposal of HUD foreclosed abandoned buildings, to offering Federal
    employees a choice to receive either pre-tax parking or public transit
    benefits at equal cash value. This committee has taken up the Federal
    facilities issue through its interest in the Downtown Equity Act,
    introduced by Senator Leahy in the 106th Congress, and which would
    require Federal offices to be located in existing business districts.
    We hope that it will be reintroduced and that progress is made on this
    important measure.
        The Federal Government's role in supporting smart growth has become
    increasingly important, as rapid changes in development patterns
    overwhelm State and local governments trying to keep up with rising
    demands for public services, facilities and infrastructure. In
    particular, several trends underscore the need for Federal action.
        First, housing affordability remains a dire and persistent problem
    for an astounding number of Americans. According to the congressionally
    established Millennial Housing Commission, 28 million Americans do not
    have access to decent, affordable housing. In 2000, the National Low-
    Income Housing Coalition reported that there was not a locale in the
    United States where a full-time minimum-wage earner could afford fair-
    market rent for a two-bedroom apartment. According to a new paper by
    Anthony Downs, Senior Fellow at the Brookings Institution, affordable
    housing too often exists in either declining neighborhoods that are
    geographically isolated from opportunities, or in fringe ex-urban areas
    and require residents to spend a large proportion of their income on
    car travel, which according to the Department of Commerce accounts for
    40 percent of income for America's lowest-wage earners. Another new
    report from the Brookings Institution presents the academic evidence
    debunking the claim that smart growth and affordable housing are at
    odds. This paper shows that good growth management policies increase
    affordable housing opportunities even in communities that are in high
    demand.
        Second, traffic problems are stifling the economies of regions all
    across America. Traffic congestion costs Americans $78 billion in lost
    time and wasted fuel, and the average person spends 36 hours per year
    stuck in traffic. What we once referred to as ``rush hour'' now lasts 3
    hours and occurs twice a day. This hurts everyday commuters, but it is
    especially harmful for low-income workers, who face the unenviable
    choice between the costly ownership and operation of a car and public
    transportation services that are inadequately funded to meet the
    public's demands.
        Third, consumer housing preferences are changing. According to a
    new study published by the Fannie Mae Foundation, aging baby boomers
    will constitute a growing proportion of homebuyers in the next decade,
    and many of them express a preference for compact, walkable
    neighborhoods over low-density conventional sprawl. The report's
    authors-two professors from the University of Southern California-
    estimate that between 31 and 55 percent of active homebuyers will
    prefer this type of ``smart growth'' or ``New Urban'' development
    during the coming decade. Unfortunately, the report's authors are
    pessimistic about the ability of the market to meet this growing demand
    because of the rigid finance, insurance, planning and regulatory
    conventions that facilitate sprawl development to the exclusion of
    other development patterns. As a result, the construction or
    rehabilitation of compact, walkable communities is a commonly
    unpredictable challenge, introducing the potential for expensive delays
    resulting from approvals for zoning variances and neighborhood
    resistance.
        As a response to these trends, Americans are increasingly concerned
    about urban sprawl and are seeking better choices for their
    communities. In the past 5 years, large majorities of voters have
    approved hundreds of measures to raise funds for open space and
    farmland preservation to protect valuable recreational areas, scenic
    vistas, and biologically important habitats. In 2000, the Pew Center
    for Civic Journalism released a report that found runaway sprawl and
    traffic congestion to be Americans' top local concern. A poll released
    by Smart Growth America later that year confirmed these conclusions,
    finding that large majorities of Americans are willing to support
    specific smart growth measures, ranging from affordable housing
    production to increased public transit funding. Even after the
    tragedies of September 11, voters from New Jersey to Colorado to
    California have indicated growth management to be a top local concern.
    This week, a poll by the University of Toledo will report that metro
    Toledans strongly support smart growth measures as well.
        The bills being considered by this committee can offer better
    choices to communities that are grappling with these challenges. The
    Community Character Act, S. 975, and the Brownfield Site Redevelopment
    Assistance Act, S. 1079, are two proposals that will help communities
    respond to the impacts of rapid changes in growth patterns that have
    left some communities with dwindled populations and vacant buildings,
    and still others with overcrowded schools and overburdened
    infrastructure. These two bills provide valuable assistance to States
    and communities to address these issues in a manner that is appropriate
    for the Federal Government.
        The Community Character Act offers assistance to State or tribal
    governments who have identified a need to develop or update land use
    planning legislation, but lack the capacity to do so. Appropriately,
    the Community Character Act does not impose a mandate on States to
    update their land use plans. Instead, it offers State and tribal
    governments financial assistance to help cover their costs of ensuring
    broad public participation, researching and developing land use plans,
    integrating State, regional, tribal or local plans with Federal land
    use plans, and acquiring technology to support their efforts.
        S. 975 will help communities create a vision for the future, while
    leaving land use and development decisions to State and local
    governments. In many places, part of that vision for the future will
    include an effort to reinvest and encourage economic development in
    existing communities. This committee has already shown great leadership
    on this issue. Senator Chafee, I congratulate you and the entire
    committee on the passage of the Small Business Liability and
    Brownfields Revitalization Act. Smart Growth America was one of the
    first organizations to endorse S. 350, and we were delighted to see
    President Bush sign the final bill into law.
        The Small Business Liability and Brownfields Revitalization Act
    will make a tremendous contribution to brownfield redevelopment by
    assisting in their clean-up and providing liability relief. However,
    many of these sites are located in communities that have experienced
    such widespread disinvestment that their recovery is dependent on
    additional economic stimulation. The Brownfield Site Redevelopment
    Assistance Act, S. 1079, complements the recently signed brownfields
    law by targeting assistance toward the development of public facilities
    and services, planning, training and technical assistance to help
    communities overcome the burdens of brownfield sites.
        Smart Growth is about providing better choices for our communities.
    Across the Nation, families are demanding more convenient, affordable
    and safe transportation and housing options, communities want more
    tools for grappling with rapid change, and civic leaders wish to have
    greater predictability in the business of development and preparations
    for the future. The Federal Government has a responsibility to aide
    States and localities communities by sharing information on best
    practices, providing financial and technical support to help
    communities respond to changing growth patterns, and to be a good
    partner with State and local leaders. The Community Character Act and
    the Brownfields Site Redevelopment Assistance Act both advance these
    goals to improve the quality of life of all Americans. Smart Growth
    America supports both of these bills and looks forward to working with
    the committee to see their timely passage.
     Statement of F. Gary Garczynski, President on Behalf of the National
                          Association of Home Builders
        Chairman Jeffords and members of the Environment and Public Works
    Committee, I am pleased to appear before you today to share the views
    of the National Association of Home Builders concerning S. 975, the
    Community Character Act of 2001. My name is Gary Garczynski and I am
    the 2002 President of the National Association of Home Builders. I am a
    homebuilder and developer from Woodbridge, Virginia, and much of my
    business focuses on redevelopment of urban areas and the inner ring of
    older suburbs. I am a past president of the Northern Virginia
    Transportation Alliance and a founder of the Greater Washington Region
    Smart Growth Alliance.
                                   background
        While we appreciate the efforts of this committee to address growth
    issues, NAHB is opposed to the Community Character Act. This country
    will continue to grow and NAHB has been working for years on how to
    grow ``smart.'' An emerging issue that goes hand in hand with smart
    growth is population pressure. Projections based on U.S. Census data
    show that the population segment between 25 to 64, the population
    segment that accounts for the most household formation, will increase
    by about 1.4 million per year over the next 10 years. Although every
    State will add people in this segment, the States of California,
    Florida, Georgia, North Carolina, Texas and Washington will account for
    half of the population growth. With the addition of approximately
    800,000 immigrants per year, the number of households will increase
    about 1.3 million per year for the next 10 years. To satisfy this
    demand, and demand for the replacement of lost housing stock, home
    builders will have to provide approximately 1.6 million new homes a
    year. The option to halt future growth as a means of controlling
    present frustrations is unrealistic.
        In an effort to address the short-term pressures of growth, the
    Community Character Act of 2001 provides funding incentives for Federal
    and State agencies to work together toward implementing State land use
    plans. Although the legislation acknowledges that land use planning is
    within the rightful jurisdiction of the State and local governments,
    there are a number of alarming elements found in the bill. There have
    been some modifications to the bill from its original form in the 106th
    Congress, such as the recognition of the need for a range of housing
    choices in land use planning. However, S. 975, taken in its totality,
    remains prescriptive and intrusive in character and for this reason
    unacceptable to the home building community.
                               critique of s. 975
        NAHB's overall concern and objection to S. 975 is based upon an
    unwarranted Federal intrusion into the State and local land use
    process. Further, there is insufficient emphasis on the critical and
    appropriate role of local government in land use decisions. S. 975
    emphasizes State land use plans, not just State support for local land
    use planning. This legislation implies that all planning should take
    place on a State or tribal government level, which is a top down
    approach to planning, and negates the critical role of local
    jurisdictions in planning, regulating and managing land resources. NAHB
    believes there needs to be adequate and improved coordination with
    local plans on all levels.
        The Community Character Act authorizes the Secretary of Commerce,
    acting through the Assistant Secretary of Commerce for Economic
    Development, to create a Federal grant program to incentivize the
    updating of State land use planning. The legislation presumes that the
    Secretary of Commerce, and the Federal Government, has a better idea of
    the source of nationwide development pressures and the best way to
    solve those problems. NAHB strongly believes that local citizens and
    local governments are the best arbiters for what is the appropriate
    design for local land use plans. As a builder, I work on a day-to-day
    basis with local and State officials and community groups to plan
    development in a responsible and thoughtful manner.
        Section 4(a)(3) of the Community Character Act authorizes the
    Secretary of Commerce to give preference to a State that has
    ``inadequate or outmoded land use planning legislation'' and ``is
    experiencing significant growth.'' Unfortunately, the Secretary is
    authorized to make a subjective judgment in an area where the Secretary
    can claim no special expertise. In an effort to award these grants, the
    Secretary would presumably establish a Federal definition of what
    constitutes ``inadequate or outmoded land use planning legislation'' or
    a Federal definition for ``significant growth'' and somehow apply those
    Federal definitions to State and local situations. The Secretary of
    Commerce can claim no particular expertise in the determination of
    ``significant growth'' when comparing two or more areas of the country.
        Additionally, under Section 4(a)(3), the Secretary is required by
    the legislation to give favor to a State that will develop or revise
    their land use plan ``consistent with updated land use planning
    legislation.'' I am fearful that this language authorizes the Federal
    Government to develop ``updated land use planning legislation.'' Or
    perhaps the Secretary is authorized to endorse a particular State's
    land use legislation as guidance. Authorizing the Secretary to use a
    particularly proactive State's land use legislation as a standard that
    embodies the concept of ``updated'' could lead to the Federal
    endorsement of some land use plans that are both onerous and an ill-fit
    for other States. But, because of the allure of Federal money, States
    might be inclined to overlook the negative aspects of these onerous
    plans.
        NAHB is pleased that S. 975 recognizes the need for a ``range of
    affordable housing options'' in any smart growth plan (Section
    4(b)(1)(F)). Certainly, housing affordability should be one of the
    goals of any local government. As we have seen in many areas of the
    country, economic prosperity and job creation are often not accompanied
    by affordable housing opportunities. Without the availability of
    decent, affordable housing and the ability for citizens to live where
    they work, citizens are forced into longer commuting times and longer
    distances from goods and services.
        Of particular concern to NAHB is the condition of grant eligibility
    found in Section 4(b)(6). Under this section, the Secretary of Commerce
    is required to favor grant applicants which include ``approaches to
    land use planning that are consistent with established professional
    land use planning standards.'' Simply, this provision uses Federal
    dollars to incentivize State legislatures to adopt professional
    planning standards. While there are certainly many differing
    professional planning standards, given the very recent release of the
    American Planning Association's Growing Smart Legislative Guidebook, S.
    975 appears to facilitate the adoption of the model statutes contained
    in the Legislative Guidebook. NAHB cannot support legislation that
    could be construed to impose a Federal model for land use planning on
    local governments. NAHB believes that the best way to promote
    ``community character'' is to let the community determine its own land
    use policies.
        Another point of concern is the use of grant funds in the
    legislation. Specifically, Section 4(c)(1)(D) authorizes grant funding
    for the use of integrating ``State, regional, tribal, or local land use
    plans with Federal land use plans.'' This top-down approach that is
    promoted by S. 975 concerns NAHB. If land use planning is ``rightfully
    within the jurisdiction of State, tribal, and local government,'' as
    Section 2(2) of the legislation states, the Federal Government should
    be integrating with State and local plans, not the other way around as
    encouraged by the legislation.
        The legislation raises potential constitutional questions under the
    Tenth Amendment, where powers not expressly granted to the Federal
    Government in the Constitution--like zoning and land use decisions--are
    reserved to the States and local governments. Just over a year ago, in
    Solid Waste Agency of Northern Cook County v. U.S. Army Corps of
    Engineers, 531 U.S. 159 (2001) (``SWANCC''), the Supreme Court demanded
    ``heightened'' scrutiny when statutes and regulations ``alter[] the
    Federal-State framework by permitting Federal encroachment upon a
    traditional State power.'' In this regard, the Court ruled:
    ``Regulation of land use [is] a function traditionally performed by
    local governments.'' By creating prescriptive criteria by which Federal
    grant money is awarded for State land use planning, the Community
    Character Act has the potential to upset the Federal-State balance that
    the Court cautioned against in SWANCC.
        Finally, Section 5 of the bill authorizes $1 million a year for
    Economic Development Administration Technical Assistance. While the
    intent of Section 5 may be no more than the establishment of a
    Department of Commerce clearinghouse for planning ideas, the authority
    granted under this section underscores the Federal Government's
    opportunity to influence local planning decisions. Under Section 5, the
    Secretary of Commerce is authorized to provide technical assistance to
    planning officials after consultation with a myriad of Federal
    agencies: The Environmental Protection Agency; the Department of
    Transportation; the Department of Agriculture and any of the other
    Federal agencies. Finally, the Secretary of Commerce is expected to
    consult with ``non profit organizations that promote land use
    planning.'' While there are many organizations who would qualify in
    this later category, it is logical to assume that the American Planning
    Association and the Legislative Guidebook could be the primary
    providers of the technical assistance and the information sharing
    promoted by the Commerce Department. Again, the Federal Government
    should not be in the business of promoting local land use planning.
                                   conclusion
        The Community Character Act is an unnecessary interference by the
    Federal Government in traditionally and constitutionally protected
    rights of local governments. By offering Federal dollars to State
    legislators who have concerns about the increasing pressures of growth,
    the Community Character Act rewards States for solving problems in the
    manner the Federal Government would like it solved. This legislation
    implies that Washington knows best when is comes to controlling
    development pressures.
        Rather than authorizing money to promote the Federalizing of the
    local land use process, I believe the government is best served by
    using its money to coordinate its own various land use authorities and
    the government's often contradicting policies. Simply, local planners
    would be better served by the streamlining or improved cross-department
    coordination of the Federal requirements and processes that contribute
    to the local and State land use plans. Our industry has struggled over
    the years with a myriad of overlapping regulations that inhibit
    responsible development.
        Mr. Chairman, last year members of this committee, led by Senator
    Lincoln Chafee, spearheaded the passage and eventual enactment of
    Federal brownfields legislation. While NAHB maintains that the
    brownfields legislation could have gone further to truly address the
    entire universe of brownfields sites in this country, the legislation
    was a good first step in returning brownfields sites to productive use.
    In fact, NAHB's national smart growth policy recognizes the importance
    of brownfields redevelopment in the concept of smart growth.
        I believe the new brownfields law represents the best avenue for
    future Federal involvement in local planning. By removing the barriers
    to the cleanup and redevelopment of brownfields, the Federal Government
    has given local governments another tool to effectively plan for and
    manage growth. I truly believe the best way for the Federal Government
    to aid in the management of growth is to reform Federal laws which
    inhibit local communities from using all of their growth management
    tools and let local communities plan the best education,
    transportation, housing plan that reflects their unique needs.
        Additionally, Senator Levin's bill, S. 1079, the Brownfield Site
    Redevelopment Assistance Act of 2001, may further the ability of local
    communities to redevelop brownfield sites and return them to productive
    use. Grants provided under S. 1079 have the potential to complement the
    U.S. Environmental Protection Agency brownfields grant program recently
    enacted in the new brownfields law. However, I am concerned that grants
    under this program can be used for local planning and the criteria for
    awarding of those grants are subject to Federal interpretation and
    therefor open to Federal preferences for growth management.
        Further, NAHB supports H.R. 2941, the Brownfields Redevelopment
    Enhancement Act of 2001. This legislation, sponsored by Representative
    Gary Miller of California and Representative Carolyn Maloney of New
    York, removes Federal barriers to brownfields redevelopment funds. The
    bill would eliminate the current requirement for local communities to
    leverage Department of Housing and Urban Development (HUD) brownfields
    grants with Community Development Block Grants (CDBG) funds. This
    requirement has served to stall brownfields redevelopment because
    communities are reluctant to tie up these critical funds. H.R. 2941
    will provide local communities with greater flexibility without Federal
    prescriptions.
        Another example of ``smart growth'' is looking at Federal
    initiatives that target population needs and help revitalize and
    redevelop communities. In the coming months, Senators Kerry and
    Santorum plan to introduce a homeownership tax credit that provides tax
    credits for the development or substantial redevelopment of homes for
    low to moderate-income buyers in census tracts with median incomes up
    to eighty percent of the State median. This tax credit illustrates a
    positive Federal role for the encouragement of smart growth.
        Mr. Chairman, thank you for this opportunity to share the views of
    the National Association of Home Builders on this important issue. I
    look forward to any questions you of the members of the committee may
    have.
                                     ______

           Responses of Gary Garczynski to Additional Questions from
                                Senator Jeffords
        Question 1. A study in the current issue of Fannie Mae Foundation's
    Housing Policy Debate found that home buyers aged 45 and older, who
    prefer denser, more compact housing alternatives, will account for a
    third of total homeownership growth over the next 10 years. That is
    double the same segment's market share in the 1990's. Demographics are
    rewriting the assertion that people prefer single family, detached lots
    in the suburbs. How do you propose we meet the preferences of these
    consumers?
        Response. While NAHB survey data has shown that a vast majority of
    Americans still prefer single-family homes located in the suburbs,
    there does seem to be an increase in demand for high-density
    development. In fact, NAHB and U.S. Census data shows an increase over
    the last decade in the number of housing units, both single- and multi-
    family, built in city centers. As demand for high-density development
    increases, NAHB will continue to meet that demand as it has in the
    past: by working with local, State and Federal partners to provide
    opportunities and incentives for homeowners. Government must continue
    to provide efficient, modern infrastructure, effective crime
    prevention, quality school systems and homebuyer incentives as a means
    of keeping interest high and costs low.
        Two good examples of the effectiveness of this
    homebuildergovernment partnership are the Building a Million Homes in
    America's Cities initiative and the recent enactment of the Federal
    brownfields law. In 1999, NAHB partnered with the Department of Housing
    and Urban Development (HUD) and the U.S. Conference of Mayors to
    construct one million homes in the nation's cities and inner-ring
    suburbs over the next 10 years. This effort will help curb urban sprawl
    as well as aid in the revitalization of America's cities. Further, NAHB
    has supported brownfields redevelopment as a means of turning
    unproductive former industrial land into viable economic opportunities.
    The new law will remove the threat of liability, provide funding for
    clean-ups and encourage private investment in the redevelopment of
    these sites.
        The home building industry has been answering home buyers' and
    renters' demand and preferences for housing for as long as the industry
    has existed. The home building industry will respond to the location
    preferences of the next group of homebuyers and renters, just as it has
    in the past. Challenges will continue to exist wherever the next
    development is located. Infill development will present a different set
    of the challenges to the home builder. Home builders and local
    governments will have to work together to respond to consumer
    preferences for denser, more compact housing alternatives within the
    current housing patterns and zoning permissions. In many places, voters
    and their elected representatives will have to change existing land use
    rules before the building industry can respond to buyers and renters.
        As we move forward from this time and preferences continue to
    change, home builders will continue to provide a range of safe, decent,
    affordable housing for all Americans where ever they choose to live.

        Question 2. I understand that the National Association of Home
    Builders supports the Administration's proposal to increase
    homeownership in targeted neighborhoods by providing developers with
    tax credits to cover the difference between construction costs and land
    values in distressed neighborhoods. I would assert that this proposal
    is no different--and in fact may be more intrusive--than what is being
    contemplated at today's hearing. Please explain your interpretation of
    the difference.
        Response. NAHB supports the Bush Administration's home buyer tax
    credit as a means of addressing home ownership in distressed areas and
    for households that would otherwise be unable to afford a home. NAHB
    also supports rational, local land planning in order to anticipate
    future housing and other development needs.
        The Bush Administration's ``Renewing the Dream'' tax credit
    proposal provides an enhancement for the housing industry by providing
    the necessary infusion of capital to provide greater homeownership
    opportunities for minorities. While there are certain income and
    geographic eligibility requirements, the Federal Government is not
    mandating that a particular type of housing be built in a particular
    location. The tax credit is an incentive to builders who willingly
    comply with the program's requirements. Simply, without this type of
    program, homes cannot be built in these locations because of the
    increased cost to developers. Further, the program complements the
    concept of ``smart growth'' by providing an incentive to revitalize
    older neighborhoods. By utilizing an existing model of housing support,
    the Low-Income Housing Tax Credit, the Administration's proposal limits
    the need for additional Federal bureaucracy and complex administration.
        In contrast to the ``Renewing the Dream'' tax credit, the Community
    Character Act rewards States for solving growth problems in the manner
    the Federal Government would like it solved. While the proposed tax
    credit provides an incentive to build affordable housing in
    economically disadvantaged areas, the Community Character Act creates
    an additional and unnecessary layer of bureaucracy. The Community
    Character Act does not provide an incentive for States to simply update
    their planning statutes, but rather makes Federal planning preferences
    a condition of Federal aid.
       Statement of Mary Lou Bentley, Executive Director, Western Nevada
        Development District, on Behalf of the National Association of
                           Development Organizations
        Thank you, Mr. Chairman and members of the committee, for the
    opportunity to testify today on behalf of the National Association of
    Development Organizations (NADO) on the EDA Brownfield Site
    Redevelopment Assistance Act of 2001.
        My name is Mary Lou Bentley and I am the Executive Director of the
    Western Nevada Development District, which is headquartered in Carson
    City and serves a seven-county region in Northwest Nevada. Incorporated
    in 1983, the organization is a designated and funded Economic
    Development District recognized by the US Economic Development
    Administration (EDA). As a locally controlled entity, the Western
    Nevada Development District is governed by a policy board consisting of
    county and city elected officials, business leaders and citizen
    representatives.
        The National Association of Development Organizations (NADO)
    provides training, information and representation for regional
    development organizations serving the 82 million people living in small
    metropolitan and rural America. Founded in 1967 as a public interest
    group, NADO and its members are part of the intergovernmental
    partnership among Federal, State and local governments. Through its
    research foundation, NADO also provides research, education and
    training opportunities for community, economic and rural development
    practitioners and policymakers.
        NADO's general members--known variously as councils of government,
    economic development districts, planning and development districts,
    regional planning commissions and regional councils--provide valuable
    professional and technical assistance to over 1,800 counties and 15,000
    small cities and towns, many of which have little or no professional
    staff.
        Members of NADO also deliver a myriad of Federal and State programs
    on a regional basis. Depending on local need, a regional development
    organization may administer and deliver aging, community and economic
    development, emergency management, environment, housing, small business
    development finance, transportation and work force development
    programs.
        Another important function of the 325 regional development
    organizations who are designated by EDA as Economic Development
    Districts is to bring local communities together on a regional basis to
    develop Comprehensive Economic Development Strategies (CEDS). With EDA
    planning grant assistance, each regional organization formulates
    programs and strategies to create and retain quality jobs as well as
    build local institutional capacity in distressed areas.
        Mr. Chairman, we strongly support the goals and intent of the EDA
    brownfields redevelopment legislation for three main reasons.
        First, Mr. Chairman, the proposed EDA brownfields redevelopment
    program would significantly strengthen the current portfolio of Federal
    brownfields programs. While the Environment Protection Agency has an
    exceptionally effective and important brownfields program, it is
    targeted almost exclusively toward helping communities assess and
    cleanup brownfields. The EDA program would establish a unique and
    flexible set of tools to help local governments, regional development
    organizations and nonprofits redevelop and transform former brownfields
    sites into productive facilities.
        As highlighted in two recent reports by the NADO Research
    Foundation, there have been a number of impediments historically to
    successful brownfields work in small metropolitan and rural areas.
    These include a lack of local professional staff expertise and time,
    limited project implementation funds, liability concerns and property
    ownership issues. In addition, redevelopment activities are very
    costly, with a typical project costing over $5 million. [Source:
    Reclaiming Rural America's Brownfields: Alternatives to Abandoned
    Property. NADO Research Foundation, April 2001.]
        While the recently enacted EPA brownfields legislation aggressively
    addresses many of these impediments, such as liability concerns and
    funding for assessment and cleanup, there is still a significant void
    in funding for redevelopment activities, including planning and
    technical assistance. The proposed program would not only place a
    priority on brownfields redevelopment within EDA, but also raise
    awareness in local communities about the hundreds of thousands of sites
    scattered around the country.
        More importantly, the creation of the EDA program would reinforce
    the concept that local organizations have options beyond cleaning up
    sites to preserve green space and curb sprawl. Local communities could
    now pursue strategies for taking previously productive industrial and
    commercial facilities and returning them to viable economic centers.
    This represents the best of both worlds: creating jobs and increasing
    local revenue, while also raising community pride and environmental
    awareness, promoting positive land use, and encouraging reinvestments
    in older areas. Sites that once marred the landscape could be put back
    into productive use for the public and private sectors.
        In studying existing brownfields efforts, the NADO Research
    Foundation found a host of good examples and best practices around the
    Nation. In Vermont, for example, local elected officials and community
    leaders within the area covered by the Southern Windsor County Regional
    Planning Commission teamed together to address six brownfields sites,
    including a former Goodyear plant and machine shop. Today, the adaptive
    reuse of the site is providing quality jobs and tax revenue to the
    community.
        Located on a narrow strip of land between the Chesapeake Bay and
    the Atlantic Ocean, the town of Cape Charles and Northhampton County in
    Virginia also proved that redevelopment is possible, even in highly
    distressed areas. With assistance from EDA and others, the community
    now has the nation's first eco-industrial park, which features
    manufacturing space, conference facilities, restored wetlands, a nature
    trail, environmental education facility and a tertiary sewage treatment
    system. It even uses solar panels to cut energy costs.
        Second, Mr. Chairman, the proposed EDA brownfields program would
    help regional development organizations and local governments
    incorporate redevelopment efforts into their comprehensive economic
    development strategies.
        Acknowledging the presence of brownfields in a particular area is
    an important first step to considering redevelopment. Many
    organizations that are currently involved in brownfields work initially
    failed to recognize they had brownfields, but instead knew they had
    land that was abandoned and potentially contaminated. In many cases,
    this awareness coincided with the stark reality that land for
    development was unavailable. At this point, their sights often turn to
    vacant, abandoned pieces of land.
        Along the shoreline of Lake Michigan, for example, the West
    Michigan Shoreline Regional Development Commission (RDC) is assisting
    120 cities and towns and five counties in economic development
    activities including redeveloping brownfields sites. The West Michigan
    Shoreline RDC annually asks local governments to submit projects for
    its Comprehensive Economic Development Strategy. The suggested projects
    are then prioritized and sorted into EDA's main project categories.
        Within the region, both the city and county of Muskegon are
    recognized as leaders in taking a proactive role in brownfields
    redevelopment. The city has established a Brownfields Redevelopment
    Authority to promote the revitalization of environmentally distressed
    properties within the city, while the county is transforming former
    foundries into recreational parks, industrial parks, shopping centers,
    restaurants and housing. The regional organization plays the key role
    of coordinator, making sure that the various levels of government are
    communicating and sharing information.
        Currently, EDA provides seed funding for local communities,
    predominantly through the national network of 325 Economic Development
    Districts, to prepare comprehensive strategies that:

              promote economic development opportunities;
              foster effective transportation access;
              enhance and protect the environment; and
              balance resources through sound management of
            development.

        While brownfields redevelopment and revitalization is consistent
    with the overall goal of the planning process, most small metropolitan
    and rural communities have been either reluctant to tackle the issue or
    were unaware of potential Federal assistance programs. Another major
    problem is the decline in the true purchasing power of the EDA planning
    grant program, making it difficult for most regions to add another
    element to the process.
        While still an incredibly valuable and essential program for
    regions, the average district planning grant is currently about
    $54,000, the same average as in 1966. Adjusted for inflation, the value
    of a 2002 grant is less than $10,800 or 20 cents on the dollar. For
    districts to continue building on their successful track records, they
    need a well-deserved funding increase to remain on the cutting edge,
    informed and well versed in the latest planning issues.
        We believe the legislation takes the right approach by providing
    supplemental planning assistance and calling for more coordination of
    brownfields redevelopment within the context of the existing strategy
    development process. It is also noteworthy that legislation
    specifically requires the Secretary of Commerce to be involved in
    coordinating efforts with other Federal agencies, State and local
    officials, Indian tribes and nonprofit organizations.
        Brownfields redevelopment activities are complex, costly and time
    intensive, therefore, coordination is a major key to success. This
    includes dialog and partnerships among the various Federal agencies, as
    well as at the local level between local governments, nonprofits, the
    private sector and the public. It also involves open communications
    among the various levels of government.
        Third, Mr. Chairman, the proposed legislation would allow EDA to
    continue its successful brownfields redevelopment work without
    depleting its resources for other equally important initiatives. Since
    1997, EDA has invested more than $250 million in more than 250
    brownfield redevelopment projects nationwide. However, there is little
    assurance currently that the agency can sustain this level of
    investment, especially within the existing appropriations and
    authorization caps.
        By establishing a specific program for brownfields redevelopment,
    the agency would be given the stability and sustainability required to
    meet the growing needs. According to the US Conference of Mayors, the
    redevelopment of brownfields could generate more than 550,000
    additional jobs and up to $2.4 billion in new tax revenue for major
    cities. This number is even greater when you add the hundreds of
    thousands of brownfield sites in small metropolitan and rural areas. A
    1999 survey of regional development organizations found that millions
    of dollars could be generated annually through local taxes on
    redeveloped brownfields property.
        In addition, the program is needed to help ensure that rural areas
    have an opportunity to obtain implementation, technical assistance and
    planning funds for brownfields activities. Within both the current EPA
    and EDA programs the limited budgets almost force the agencies to
    select high profile projects in major urban areas. This frustration
    with the lack of resources for less populated regions was constantly
    mentioned during the NADO Research Foundation studies.
        By separating the program, the agency would also be better
    positioned to assist distressed communities with their other pressing
    needs, whether it is recovering from a natural disaster, responding to
    a plant closing or expanding existing businesses. While many of the
    nation's urban and suburban areas have enjoyed economic prosperity in
    recent years, there are still hundreds of small communities struggling
    to enter or re-enter the economic mainstream. Often times, EDA is the
    only Federal agency that can help these distressed rural and small
    metropolitan communities.
        Over the past 35 years, Mr. Chairman, EDA has developed a
    successful track record in partnering with local communities--including
    regional development organizations--to revitalize, upgrade and expand
    former commercial sites into industrial facilities that help create
    quality jobs, expand the local tax base and improve the quality of life
    in the area. This includes making the necessary investments in
    infrastructure, as well as providing often overlooked planning and
    technical assistance.
        In conclusion, we strongly believe that the expanded brownfields
    redevelopment program would be a valuable addition to the EDA toolbox.
    The legislation would significantly strengthen the current portfolio of
    Federal brownfields programs. It would help regional development
    organizations and their partners incorporate brownfields redevelopment
    efforts into their comprehensive economic development strategies. And,
    it would allow EDA to continue its brownfields work without depleting
    resources for its other job creation programs.
        Mr. Chairman and members of the committee, thank you for the
    opportunity to testify today on behalf of NADO and I would welcome any
    questions.
                                   __________
              Statement of the National Association of Realtors()
                                  introduction
        Thank you for the opportunity to submit for the record the National
    Association of Realtors'() comments on S. 975, the Community Character
    Act; S. 1079, the Brownfield Site Redevelopment Act; and EPA Smart
    Growth Initiatives.
        Land development and growth, and planning for this growth, is an
    issue facing many of our communities. We believe growth should be
    encouraged as it is a stimulus to the economy, increases the tax base,
    provides places to live and work, and offers opportunities that would
    not otherwise exist. We also realize the responsibility Realtors()
    have to educate and work with local, State, and Federal Government
    officials in developing responsible growth planning that is equitable
    and which considers the divergent needs of transportation, housing,
    agriculture, commercial, industrial, and environmental concerns.
        In considering the issue of Smart Growth, the National Association
    of Realtors() identified five principles that we believe must be
    addressed in any Smart Growth policies:
        1. Provide Housing Opportunity and Choice.--Despite the housing
    market's strength in recent years, and the achievement of an all-time-
    high 68 percent homeownership rate, both the supply of and the demand
    for affordable housing--in both the rental and sales markets, and in
    both existing homes and new development--remains a serious issue in
    communities throughout the Nation. Smart growth policies must foster a
    wide range of housing choices at all price levels to suit a diverse
    population. These objectives will have to be met primarily through
    market-driven approaches.
        2. Build Better Communities.--Livable communities offer a variety
    of affordable housing choices in an environment with good schools, low
    crime, efficient transportation systems, ample recreation and park
    facilities, open space, a strong employment base, and an economically
    viable commercial real estate sector.
        3. Protect the Environment.--Governments at all levels should
    consider policies and program that aid the control of pollution;
    provide for programs that encourage preservation of natural resources,
    significant land and properties of historic significance, and further
    encourage, through incentives, the protection of aquifers, rivers and
    streams, agricultural lands, wetlands, scenic vistas, natural areas,
    and open space. In adopting environmental protection policies, the
    Federal Government must recognize the importance of local
    decisionmaking.
        4. Protect Private Property Rights.--Land use policies at all
    levels of government must recognize the importance of private property
    rights. Private property rights are fundamental to our free-market
    economic system and are protected by the 5th and 14th Amendments to the
    United States Constitution. The continued strength of our nation's
    economy depends on the preservation of the right to freely own, use and
    transfer real property.
        5. Implement Fair and Reasonable Public Sector Fiscal Measures.--To
    support adequately the infrastructure needs of communities resulting
    from growth, governments at all levels should cooperate in the adoption
    of balanced, fair, equitable and incentive-based approaches to finance
    and pay for the development, expansion and maintenance of roads,
    schools, water and sewer facilities. Revenue and financing mechanisms
    established to pay for necessary infrastructure costs should be shared
    proportionately by those segments of the population that are served by
    the improvements.
                        s. 975, community character act
        The National Association of Realtors supports the Community
    Character Act, which would provide grants to States for land use
    planning. NAR supports this bill because the bill:
         Recognizes that land use planning is rightfully a State
    and local government function;
         Provides needed assistance to States and localities to
    better plan for inevitable growth;
         Requires that planning performed under this Act must
    provide for housing opportunity and choice and ``provide for a range of
    affordable housing options;''
         Promotes improved quality of life, sustainable economic
    development, and protection of the environment
        Additionally, we support the following specific elements of S. 975:
         The inclusion of education as an eligible use of the funds
    (Sec. 4(c)). We believe there is a need for citizens and policymakers
    to become more educated about infrastructure needs; about how growth
    policies affect the ability of the private market to provide affordable
    housing; and about the need for higher density development in
    appropriate places.
         The provisions for Pilot Projects for Local Governments
    (Sec. 4(d)), which would increase the capacity of local governments to
    plan for their futures.
         The use of these funds for improved technology and
    development of electronic data bases to support land use planning (as
    suggested in Sec. 5(b)).
        We would like to stress that there is no ``one-size-fits-all''
    approach to land use planning or State planning statutes. Professional
    planners, planning commissioners, elected officials, and citizens
    should study a wide variety of land use planning approaches before
    deciding what is best for their State or local community. Land use
    planning should remain a State and local government function, and
    neither the Federal Government nor any particular professional
    organization should impose its version of planning statutes on the
    States. We support the Community Character Act with the understanding
    that nothing in the Act would oblige a State to adopt any particular
    approach to land use planning or regulation.
         s. 1079, brownfield site redevelopment assistance act of 2001
        NAR has been committed to brownfields reform for many years, and
    enactment of such legislation is our top environmental priority in the
    107th Congress. We were strong advocates of the Small Business
    Liability Relief and Brownfields Revitalization Act, which was recently
    passed by Congress and signed into law by President Bush. By addressing
    brownfields liability and funding concerns, this new legislation
    provides the certainty necessary for the real estate industry to move
    forward and undertake redevelopment of brownfields sites throughout the
    country. Through a reinvigorated cooperative effort between government
    and private business interests, EPA's Brownfields Economic
    Redevelopment Initiative will successfully promote brownfields
    redevelopment for years to come.
        In that same spirit, NAR supports S. 1079, the Brownfield Site
    Redevelopment Assistance Act. In accordance with its mission, the
    Economic Development Administration (EDA) works in partnership with
    State and local governments to help economically distressed communities
    attract private capital investment and create employment opportunities.
    EDA's support of brownfields redevelopment is an important complement
    to EPA's program. By providing grants to redevelop brownfields sites
    and put them to new and productive uses, S. 1079 will provide a cleaner
    and safer environment, increase the tax base and create jobs.
                          epa smart growth initiatives
        We are pleased to be a partner with the U.S. Environmental
    Protection Agency in the Smart Growth Network. We support the two Smart
    Growth initiatives recently announced by the EPA Administrator,
    Governor Whitman: an EPA National Award for Smart Growth Achievement to
    recognize and publicize exemplary development; and a program to help
    local planners better integrate brownfields redevelopment and open
    space preservation through grants and technical assistance.
        Thank you for the opportunity to express our views.
        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                                    [greek-d]