[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]
