[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]




 
 THE CHALLENGE OF BROWNFIELDS: WHAT ARE THE PROBLEMS AND SOLUTIONS IN 
         REDEVELOPING PENNSYLVANIA'S LEHIGH VALLEY COMMUNITIES?

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

                                HEARING

                               before the

                       SUBCOMMITTEE ON FEDERALISM
                             AND THE CENSUS

                                 of the

                              COMMITTEE ON
                           GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                            OCTOBER 25, 2005

                               __________

                           Serial No. 109-117

                               __________

       Printed for the use of the Committee on Government Reform


  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                               index.html
                      http://www.house.gov/reform


                                 ______

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                     COMMITTEE ON GOVERNMENT REFORM

                     TOM DAVIS, Virginia, Chairman
CHRISTOPHER SHAYS, Connecticut       HENRY A. WAXMAN, California
DAN BURTON, Indiana                  TOM LANTOS, California
ILEANA ROS-LEHTINEN, Florida         MAJOR R. OWENS, New York
JOHN M. McHUGH, New York             EDOLPHUS TOWNS, New York
JOHN L. MICA, Florida                PAUL E. KANJORSKI, Pennsylvania
GIL GUTKNECHT, Minnesota             CAROLYN B. MALONEY, New York
MARK E. SOUDER, Indiana              ELIJAH E. CUMMINGS, Maryland
STEVEN C. LaTOURETTE, Ohio           DENNIS J. KUCINICH, Ohio
TODD RUSSELL PLATTS, Pennsylvania    DANNY K. DAVIS, Illinois
CHRIS CANNON, Utah                   WM. LACY CLAY, Missouri
JOHN J. DUNCAN, Jr., Tennessee       DIANE E. WATSON, California
CANDICE S. MILLER, Michigan          STEPHEN F. LYNCH, Massachusetts
MICHAEL R. TURNER, Ohio              CHRIS VAN HOLLEN, Maryland
DARRELL E. ISSA, California          LINDA T. SANCHEZ, California
JON C. PORTER, Nevada                C.A. DUTCH RUPPERSBERGER, Maryland
KENNY MARCHANT, Texas                BRIAN HIGGINS, New York
LYNN A. WESTMORELAND, Georgia        ELEANOR HOLMES NORTON, District of 
PATRICK T. McHENRY, North Carolina       Columbia
CHARLES W. DENT, Pennsylvania                    ------
VIRGINIA FOXX, North Carolina        BERNARD SANDERS, Vermont 
JEAN SCHMIDT, Ohio                       (Independent)
------ ------

                    Melissa Wojciak, Staff Director
       David Marin, Deputy Staff Director/Communications Director
                      Rob Borden, Parliamentarian
                       Teresa Austin, Chief Clerk
          Phil Barnett, Minority Chief of Staff/Chief Counsel

               Subcommittee on Federalism and the Census

                   MICHAEL R. TURNER, Ohio, Chairman
CHARLES W. DENT, Pennsylvania        WM. LACY CLAY, Missouri
CHRISTOPHER SHAYS, Connecticut       PAUL E. KANJORSKI, Pennsylvania
VIRGINIA FOXX, North Carolina        CAROLYN B. MALONEY, New York
------ ------

                               Ex Officio

TOM DAVIS, Virginia                  HENRY A. WAXMAN, California
                     John Cuaderes, Staff Director
                       Shannon Weinberg, Counsel
                         Juliana French, Clerk


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on October 25, 2005.................................     1
Statement of:
    Ferdas, Abraham, Director, Hazardous Site Cleanup Division, 
      U.S. Environmental Protection Agency, Region III; Eugene 
      Depasquale, deputy secretary for community revitalization 
      and local government support, Pennsylvania Department of 
      Protection; James M. Seif, vice president, corporate 
      relations, PPL Corp.; Paul Schoff, esq., Feinberg and 
      Schoff, LLP, CEO of Brownfield Realty, Ltd.; and Robert 
      Colangelo, executive director, National Brownfield 
      Association................................................    30
        Colangelo, Robert........................................    72
        Depasquale, Eugene.......................................    42
        Ferdas, Abraham..........................................    30
        Seif, James M............................................    48
        Schoff, Paul.............................................    57
    Michalerya, William, associate vice president, government 
      relations, Lehigh University...............................     1
    Wrobel, Kerry, president, Lehigh Valley Industrial Park, 
      Inc.; Chad Paul, Jr., chief executive officer, Ben Franklin 
      Technology Partners; Ray Suhocki, president and CEO, Lehigh 
      Valley Economic Development Corp.; and Stephen Donches, 
      president, National Museum of Industrial History...........    86
        Donches, Stephen.........................................   116
        Paul, Chad, Jr...........................................    93
        Suhocki, Ray.............................................   109
        Wrobel, Kerry............................................    86
Letters, statements, etc., submitted for the record by:
    Colangelo, Robert, executive director, National Brownfield 
      Association, prepared statement of.........................    74
    Dent, Hon. Charles W., a Representative in Congress from the 
      State of Pennsylvania, prepared statement of...............    14
    Depasquale, Eugene, deputy secretary for community 
      revitalization and local government support, Pennsylvania 
      Department of Protection, prepared statement of............    44
    Donches, Stephen, president, National Museum of Industrial 
      History, prepared statement of.............................   118
    Ferdas, Abraham, Director, Hazardous Site Cleanup Division, 
      U.S. Environmental Protection Agency, Region III, prepared 
      statement of...............................................    32
    Michalerya, William, associate vice president, government 
      relations, Lehigh University, prepared statement of........     3
    Paul, Chad, Jr., chief executive officer, Ben Franklin 
      Technology Partners, prepared statement of.................    95
    Schoff, Paul, esq., Feinberg and Schoff, LLP, CEO of 
      Brownfield Realty, Ltd., prepared statement of.............    60
    Seif, James M., vice president, corporate relations, PPL 
      Corp., prepared statement of...............................    50
    Suhocki, Ray, president and CEO, Lehigh Valley Economic 
      Development Corp., prepared statement of...................    11
    Turner, Hon. Michael R., a Representative in Congress from 
      the State of Ohio, prepared statement of...................     7
    Wrobel, Kerry, president, Lehigh Valley Industrial Park, 
      Inc., prepared statement of................................    89


 THE CHALLENGE OF BROWNFIELDS: WHAT ARE THE PROBLEMS AND SOLUTIONS IN 
         REDEVELOPING PENNSYLVANIA'S LEHIGH VALLEY COMMUNITIES?

                              ----------                              


                       TUESDAY, OCTOBER 25, 2005

                  House of Representatives,
         Subcommittee on Federalism and the Census,
                            Committee on Government Reform,
                                                     Bethlehem, PA.
    The subcommittee met, pursuant to notice, at 10 a.m., in 
rooms 291, 292, 293 of Lehigh University Rauch Business Center, 
Hon. Michael Turner (chairman of the subcommittee) presiding.
    Members present: Representatives Dent and English.
    Staff present: Shannon Weinberg, counsel; Juliana French, 
clerk; and Erin Maguire, Rep. Dent/LC.
    Mr. Turner. Good morning. We will call to order the hearing 
of the Government Reform Subcommittee on Federalism and the 
Census, and this hearing is entitled ``The Challenge of 
Brownfields: What are the Problems and Solutions in 
Redeveloping Pennsylvania's Lehigh Valley Communities?'' We 
have this morning William Michalerya to welcome us to Lehigh 
University and we want to thank him and Lehigh University for 
hosting us today.

                STATEMENT OF WILLIAM MICHALERYA

    Mr. Michalerya. Thank you very much. Congressman Dent, 
Congressman English and Chairman Turner: On behalf of President 
Greg Farrington and Lehigh University, I would like to welcome 
you to Lehigh University, Bethlehem and the Lehigh Valley.
    You could hopefully pick up on the university's emphasis on 
partnerships, since it was mandatory to welcome you to the 
university, the city and the region, and for Congressman Turner 
from Ohio, to the Commonwealth.
    At Lehigh, we consider ourselves a ``medium-sized'' 
university with approximately 4,700 undergraduate, 2,000 
graduate students, 430 faculty members and 1,200 staff. Our 
campus is approximately 1,600 acres. Our annual operating 
budget is approximately $330 million, with research 
expenditures of approximately $45 million.
    Lehigh University was founded and initially grew to support 
the railroad, steel and manufacturing industries. We are now 
playing a key role in developing the ``knowledge economy'' and 
transforming the economic landscape in the region and the 
Nation.
    We have another strong commitment in our research and 
education mission and that is industry partnerships and 
economic development. On our campus we host the Ben Franklin 
Technology Partners, the Manufacturers Resource Center and, in 
this building, the Small Business Development Center.
    In addition, we have a tradition of developing major 
research centers, including the Center for Advanced Technology 
for Large Structural Systems, the Center for Optical 
Technologies and the Center for Advanced Materials and 
Nanotechnology. These centers are anchored by a strong industry 
partnership program. They also have assisted with the missions 
of many Federal agencies, including the National Science 
Foundation, the Department of Defense, Department of 
Transportation, and NASA.
    We are also very committed to the revitalization of the 
former Bethlehem Steel property and the south side of 
Bethlehem, so your hearings on ``brownfield sites'' is 
especially appropriate to us today.
    Finally, I just want to acknowledge the hard work and 
expertise of your staffs, especially Erin Maguire, Juliana 
French, and Shannon Weinberg. It was a pleasure to work with 
them to organize this hearing.
    Again, welcome to Lehigh University and we are proud to 
help with the important work of this committee. Thank you.
    [The prepared statement of Mr. Michalerya follows:]

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    Mr. Turner. Thank you so much. Before we begin, I want to 
recognize the Members that we have on the panel today. With us 
we have Representative Phil English, who I know that you all 
know. He is from Erie, PA. We are very honored to have him 
here. He is a leader in the House on the Ways and Means 
Committee. He is also a member of the Speaker's Saving 
America's Cities Working Group where he has been recognized for 
his expertise in urban issues, the Speaker having turned to 24 
Members of the House Republican Conference who have experience 
in local government and looking to them for ways in which an 
urban policy can assist in economic development in urban areas.
    Representative English is also a leader in the issues of 
protecting our manufacturing base. He was kind enough to come 
to my district in Dayton, OH for a manufacturers' forum where 
we listened to manufacturers in my community and the challenges 
that they face and ways in which they can be assisted, and was 
the author and the lead on recent action by the House to 
encourage the floating of China's currency that has long been 
an issue of dispute for manufacturers with the fear of their 
undervalued currency providing them an edge in our economy. We 
are very excited to have him here today. He is also a cosponsor 
of my brownfields redevelopment bill, a tax credit bill, that 
when you look at these economic development opportunities in 
brownfields, could provide some Federal funding in an 
unprecedented level. We appreciate having you here today and I 
will recognize you soon for an opening statement.
    And of course, we have Representative Charles Dent. I 
greatly appreciate being asked to bring the hearing to your 
district to look at the successes that are here. We had an 
opportunity to tour the Bethlehem Steel site this morning and 
what a great incredible opportunity and an example of a 
private/public partnership, a community that has a plan and is 
working diligently and has economic successes. It is great 
today to get on the record some of the elements that have 
caused that success, but also to look at the issues that I know 
are very close to Mr. Dent's heart as he works in the House. He 
has been recognized because of his leadership in Pennsylvania 
as Vice Chair of this committee.
    It is very unusual for a freshman to be named vice chair to 
a subcommittee, but Mr. Dent was named Vice Chair of this 
subcommittee, which is again Federalism and the Census, looking 
at the interrelationship between State, local and Federal 
Governments, so he brings his expertise in the Pennsylvania 
government as we look to the issues of how the Federal 
Government can work more effectively for communities.
    And with that, I would again like to welcome you all to our 
subcommittee on Federalism and the Census and this field 
hearing entitled, ``The Challenge of Brownfields: What are the 
Problems and Solutions in Redeveloping Pennsylvania's Lehigh 
Valley Communities?'' This is the fourth in a series of 
hearings held on the issue of brownfields and brownfield 
redevelopment. Our hearings in D.C. are informative and 
helpful, but all too often we get the inside-the-beltway view 
and these field hearings allow us to reach out to the public 
and interact with individual communities on a more personal 
basis and to learn firsthand of their concerns, their 
suggestions and their successes. We have had great response to 
this hearing and I would like to again express my appreciation 
to the city of Bethlehem and to President Gregory Farrington of 
Lehigh University and his staff for sharing these facilities 
and for their accommodating efforts.
    We have a great number of witnesses present and we are here 
to listen to you. In the interest of time, I will submit my 
complete comments for the record, a copy of which is available 
at the press table.
    [The prepared statement of Hon. Michael R. Turner follows:]

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    Mr. Turner. We have two panels of witnesses before us to 
help us understand the state of brownfield redevelopment and 
the impact of the EPA's Brownfield Program across the 
Commonwealth of Pennsylvania. We also hope to hear your ideas 
for improving or complementing the EPA Brownfields Program in 
order to encourage more aggressive redevelopment. And as I 
identify the members of the two panels, if I should slaughter 
anyone's name, please reintroduce yourself to us as you come to 
be recognized.
    On our first panel we have Abraham Ferdas, Director of the 
Hazardous Site Cleanup Division with the U.S. Environmental 
Protection Agency's Region III office. We have Eugene 
DePasquale.
    Mr. DePasquale. Very good.
    Mr. Turner. They wrote it phonetically, that helps. Deputy 
Secretary for Community Revitalization and Local Support with 
the Pennsylvania DEP. Jim Seif, vice president of corporate 
relations with PPL Corp. Mr. Seif was also Secretary of the 
Pennsylvania DEP under Governor Tom Ridge. Paul Schoff, 
Feinberg and Schoff, LLP and Robert Colangelo is going to be on 
our second panel. He is currently stuck in traffic and he is 
the executive director of the National Brownfield Association.
    Our second panel of witnesses consists of representatives 
from the Pennsylvania State core community. And we have Kerry 
Wrobel, President of the Lehigh Valley Industrial Park. Chad 
Paul, Chief Executive Officer of the Ben Franklin Technology 
Partners. Ray Suhocki, president and CEO of Lehigh Valley 
Economic Development Corp. And Stephen Donches, president of 
the National Museum of Industrial History.
    I look forward to hearing all of your testimony. In 
addition to your testimony, we will have a series of questions. 
Everyone will be given 5 minutes for their presentation. I do 
want to tell you that we are going to attempt to end the 
hearing today by 12:30. We all have to return back to 
Washington today for votes in hearings and so we are going to 
try to catch an earlier train. And with that, I would like to 
recognize the vice chair of the subcommittee, the 
Representative for the 15th District of Pennsylvania, for his 
opening comments and remarks.
    Mr. Dent. Thank you, Chairman Turner, for holding this 
important hearing and thank you, too, Congressman English for 
coming from the other end of the State to be with us today. I 
truly appreciate that. Thanks again to Bill Michalerya, Greg 
Farrington and the entire staff at Lehigh University for 
providing this wonderful facility for this hearing. This 
proceeding does provide us with a wonderful opportunity to 
address the issues surrounding brownfields clean-up as they 
exist around the country and more specifically, as we have to 
confront them within the Commonwealth of Pennsylvania.
    Brownfields are both an important environmental and 
economic issue. How we decide to clean up and reuse brownfields 
across the country will be an important question to resolve as 
we go about the task of promoting industrial redevelopment, 
especially in those areas that were once dominated by 
traditional manufacturing concern, such as automaking, steel 
fabricating and ship building. These parcels of land typically 
contain hazardous substances, pollutants or contaminants and 
that is where the problem lies. The presence of these foreign 
substances sometimes makes it more cost-effective to abandon 
the land rather than pay the bill to have the property properly 
cleaned up and remediated. There are many disincentives to 
remediating a contaminated property, the first and foremost of 
which is price. To this effect, sometimes the cost of clean-up 
may be more expensive than the value of the land itself.
    Here on the south side of Bethlehem, right here in 
Pennsylvania, lies one of the largest brownfield sites in the 
country. It is the former manufacturing facility of the 
Bethlehem Steel Corp. This old plant contains railroad tracks, 
abandoned mills and left-over plant equipment on some 1,800 
acres of land that run along the banks of the Lehigh River. 
Steelmaking began here in 1857 and expanded greatly during the 
early part of the 20th century. By the 1950's the company had 
become the Nation's second largest steel producer and much of 
that work was done on the Bethlehem site.
    In fact, I was at a meeting last week of the Winston 
Churchill Society and it was brought up about Winston 
Churchill's deal with Charles Schwab in front of a very 
distinguished Washington group about the history of Winston 
Churchill and Charles Schwab and Bethlehem playing an important 
role in that discussion, just as a parenthetical. This area 
also played a vital role in the national defense. During the 
Second World War the steel that formed the basis of the 16-inch 
armor plating on battleships such as the Missouri and the 
Wisconsin was rolled at this site. For many years, it was the 
economic backbone of the Lehigh Valley.
    By the 1990's, however, Bethlehem Steel Corp. found that it 
could no longer effectively compete against foreign steel 
products and in 1995 the plant closed its doors, leaving 375 
tons of soil contaminated with arsenic and lead at the site. 
During the last years of its existence, the company operated 
the plant on what has been classified as a brownfield site 
under guidelines set up by the Federal Resource Conservation 
and Recovery Act [RCRA]. This act permitted operation of the 
plant only if the company could demonstrate that it was capable 
of managing and cleaning up the hazardous wastes that accompany 
steel production.
    While the steel company is no longer with us, the 
environmental clean-up of this site has proceeded and the 
future of this piece of property appears bright. Local 
developers, several of whom will be testifying shortly, have 
put forth plans to build a conference center, technology center 
and retail shops. Further, there is a move afoot to commemorate 
the actions of the great employees who worked here by 
establishing the Smithsonian Institution's National Museum of 
Industrial History on the site.
    These great accomplishments are the result of the 
Environmental Protection Agency and the Pennsylvania Department 
of Environmental Protection working together to establish State 
and Federal RCRA clean-up requirements with one plan. 
Pennsylvania was the first State to sign an MOA, a Memorandum 
of Agreement, with the EPA that included three Federal program 
areas: the Comprehensive Environmental Response, Compensation 
and Liability Act; the Resource Conservation and Recovery Act; 
and the Toxic Substance Control Act.
    I think this type of State and Federal partnership should 
be encouraged throughout the country, an alliance that ideally 
would bring together not only the EPA and a particular State's 
environmental agency, but other Federal agencies as well, all 
with a commitment to redevelopment.
    Pennsylvania's Land Recycling Program has had an astounding 
turnaround effect on brownfields that has not only promoted 
environmental protections, but also created economic 
opportunities for thousands of families. It has also 
rejuvenated the tax bases of dozens of communities across 
Pennsylvania. I applaud the fact that Pennsylvania's Land 
Recycling Program has transformed abandoned, inactive pieces of 
land into places of economic revitalization. Over 30,000 jobs 
have been created or retained as a result of the many business 
opportunities engendered by the recovery of brownfields in 
Pennsylvania.
    It is clear that we must continue to work at cleaning up 
and redeveloping America's brownfield sites. This is imperative 
in order to encourage job growth, promote the development of 
transportation and infrastructure on these inactive urban 
industrial areas while at the same time saving greenfields. 
While many strides have been made, there is still much to be 
done.
    That said, it is important to acknowledge future 
legislative proposals that will move us toward our goal of 
complete brownfields remediation. Last Congress, Chairman 
Turner introduced the Brownfields Revitalization Act of 2004, 
H.R. 4480, which proposed a tax credit of up to 50 percent for 
qualified remediation expenses performed at brownfield sites in 
certain poverty-rated areas. Chairman Turner expects to 
reintroduce a similar piece of legislation this Congress. This 
bill will be similar to its predecessor, but it will also more 
explicitly define the roles and obligations of some of the 
major governmental entities or parties involved, including the 
State's development agency and the environmental protection 
organization.
    It will also explicitly set out the requirements that need 
to be fulfilled in order for a developer to enjoy a tax credit 
in return for remediating a brownfields site. In addition, my 
colleague and fellow member of the Pennsylvania delegation, 
Representative Melissa Hart, has proposed the Pennsylvania, 
excuse me, the Brownfield Redevelopment Assistance Act, H.R. 
1237. This bill would provide grant moneys earmarked through 
the Department of Commerce for promotion of economic projects 
on brownfields' sites. Specifically, the goal of this 
legislation is to provide funding that would target those 
projects that have the potential to both restore employment and 
bring new income and private investment to distressed 
communities.
    Congresswoman Hart has also proposed the Financing of 
Brownfields Activities through Government Bonds Act, H.R. 3451, 
which would amend the Internal Revenue Code to allow the use of 
tax-exempt redevelopment bonds to finance the costs of 
environmental remediation at brownfield sites. Permitting the 
use of these bonds for the purpose of clean-up will provide 
much needed capital that will not only make for a healthier 
environment but will also promote needed economic redevelopment 
in areas that would clearly benefit from the same.
    Again, thank you, Chairman Turner, for acknowledging the 
importance of this issue and I look forward to hearing the 
testimony of our knowledgeable panelists, all of whom have a 
distinguished background, either at the State or National level 
or, later on, people at the local level who are just as 
experienced. So again, thank you, Chairman Turner and Mr. 
English for your presence.
    [The prepared statement of Hon. Charles W. Dent follows:]

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    Mr. Turner. Thank you. And I would like to recognize the 
Honorable Phil English.
    Mr. English. Mr. Chairman, I would like to submit my 
statement for the record. I am very enthusiastic to hear the 
testimony today of these two panels, which are truly 
extraordinary, but having submitted my formal statement for the 
record, I would like to thank you and Mr. Dent for bringing 
your subcommittee here to Lehigh and allowing me to sit in on 
it. The fact finding that you are doing today is particularly 
significant for our National policy. It is important, I think, 
that you are coming to Pennsylvania because, as Mr. Seif will 
attest, Pennsylvania has a long track record of programmatic 
commitments to economic development that I think can give us a 
perspective that would be useful for our National efforts to 
strengthen communities. At the same time, coming to this 
community, I think, is particularly important because I think 
looking at this from a Pennsylvania perspective, this community 
has done an extraordinary job making maximum use of its 
industrial space and reclaiming old sites for productive use.
    The tour that we had this morning, for me, was a real eye 
opener. And finally, I would like to say that I think you and I 
agree on this--Jane Jacobs was right. I think the health of our 
National economy is ultimately tied to the health of our urban 
communities and one of the pillars of our effort to create 
opportunities in urban communities has to be an aggressive 
brownfields policy. I want to congratulate both of you, as a 
colleague, for the extraordinary groundbreaking effort you are 
doing to focus Congress on this issue and I just want to say we 
on the Ways and Means Committee, Representative Hart and 
myself, representing Pennsylvania, are strongly committed to 
joining with you on this effort. So I thank you for the 
opportunity to be part of this proceeding today.
    Mr. Turner. Thank you. We will now start with the 
witnesses. Each witness has kindly prepared written testimony 
which will be included in the record of this hearing. Each 
witness has also prepared an oral statement which summarizes 
their written testimony. Witnesses will notice that there is a 
timer, a light on the witness table. The green light indicates 
that you should begin your remarks and the red light indicates 
the time has expired. In order to be sensitive to everyone's 
time schedule, we ask that witnesses cooperate with us in 
adhering to the 5-minute time allowance to their oral 
presentation. We will follow that with a question and answer 
period. It is the policy of this committee that all witnesses 
be sworn in before they testify, so we will now swear in panel 
one of the witnesses.
    [Witnesses sworn]
    Mr. Turner. Please let the record show that all witnesses 
have responded in the affirmative and we will begin with you, 
Mr. Ferdas.

STATEMENTS OF ABRAHAM FERDAS, DIRECTOR, HAZARDOUS SITE CLEANUP 
 DIVISIONS, U.S. ENVIRONMENTAL PROTECTION AGENCY, REGION III; 
       EUGENE DEPASQUALE, DEPUTY SECRETARY FOR COMMUNITY 
   REVITALIZATION AND LOCAL GOVERNMENT SUPPORT, PENNSYLVANIA 
   DEPARTMENT OF PROTECTION; JAMES M. SEIF, VICE PRESIDENT, 
CORPORATE RELATIONS, PPL CORP.; PAUL SCHOFF, ESQ., FEINBERG AND 
    SCHOFF, LLP, CEO OF BROWNFIELD REALTY, LTD.; AND ROBERT 
 COLANGELO, EXECUTIVE DIRECTOR, NATIONAL BROWNFIELD ASSOCIATION

                  STATEMENT OF ABRAHAM FERDAS

    Mr. Ferdas. Good morning, Mr. Chairman, and members of the 
subcommittee. My name is Abraham Ferdas. The chairman 
pronounced it right. I am Director of the Environmental 
Protection Hazardous Site Cleanup Division in Region 3 and I am 
responsible for all brownfield, superfund, oil line and 
emergency response. More than a decade ago, EPA identified a 
large problem. We saw local communities who were having a hard 
time dealing with properties that were contaminated or 
potentially contaminated by hazardous wastes. The private and 
public sector were very hesitant to get involved in those sites 
which are now known as brownfields. So 10 years ago, EPA began 
providing seed money through grants to local communities to 
identify and assess contamination of brownfields properties. 
Over the years EPA added grants for revolving loan funds to 
clean up properties. The agency also provided job training 
grants to promote employment opportunities in brownfields 
communities.
    Since EPA's earliest efforts, States, tribes, local 
governments and nonprofit organizations are now focusing on 
brownfields cleanup and development. The landmark 2002 
brownfields legislation brought into EPA's program and provided 
liability protection to promote private sector participation in 
brownfields cleanup and development. Under the new law, EPA now 
awards direct cleanup grants to public sector and nonprofit 
property owners. The 2002 law also broadened the definition of 
what could be considered a brownfields property. EPA can now 
award its brownfields grants to petroleum contaminated 
properties, mine-scarred lands and sites contaminated by 
controlled substances.
    The National brownfields effort has produced successful 
results. Since EPA awarded its first grant, EPA and its grants 
recipients have conducted more than 7,400 assessments. 
Brownfield grantees have leveraged $7.2 billion in cleanup and 
redevelopment money, creating more than 33,000 jobs. 
Brownfields have proven to be a good public investment. For 
every public dollar spent in brownfields leveraging, for every 
public dollar the leverage is $2.50 in private investment. 
Every acre of reused brownfields save 4.5 acres of green space. 
The brownfields initiative has become a National effort that 
links environmental protection and economic development with 
the ultimate goal of breathing new life in local communities.
    The Commonwealth of Pennsylvania and some 61 communities 
and nonprofits so far have received $19 million in EPA 
brownfields funding. This represents one of the Nation's 
largest concentration of EPA brownfield resources.
    Before the 2002 brownfields law, Pennsylvania was one of 
the first to receive an EPA brownfield grant to address 
contamination from mine-scarred lands. This paved the way to 
include the sites in the National Brownfields Program. Since 
passage of the Brownfields Law, all the Region 3 communities 
have received funding to address mine-scarred land projects. 
This includes the recent award of a second EPA cleanup grant to 
a nonprofit organization, Earth Conservancy, to clean up mine-
scarred sites in the Nanticoke area.
    Last year EPA and Pennsylvania Department of Environmental 
Protection signed the Nation's first One-Cleanup Memorandum 
Agreement, as Congressman Dent described better than me. This 
agreement provides a one-stop shop approach where contaminated 
communities, builders, lenders and businesses can get what they 
need from the coordination of an EPA-DEP program to ensure they 
are satisfying the State requirements in ways that are 
consistent with EPA cleanup programs. And that is very 
important. I mean, we want to be one-shop. The developer has to 
only see Pennsylvania. It doesn't have to see EPA, if we can 
help it.
    So in conclusion, EPA Brownfields Program provides valuable 
tools needed to protect and clean our environment, reduce 
neighborhood blight, generate tax revenues and create jobs. Our 
continued success will require even more interaction and 
teamwork in all levels of government, the private sector and 
non-government organizations. EPA is committed to reach out to 
our partners and the administration is committed to continue to 
strong funding for the program. Thank you very much.
    [The prepared statement of Mr. Ferdas follows:]

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    Mr. Turner. Mr. DePasquale.

                 STATEMENT OF EUGENE DEPASQUALE

    Mr. DePasquale. DePasquale. Thank you, Mr. Chairman. First 
of all, I want to thank you for highlighting this issue for 
brownfields. I went to college at the College of Western Ohio, 
which is about an hour to the east of Dayton and I am sure one 
of the reasons why you are highlighting this is Dayton, Wooster 
and cities all across Pennsylvania, if we are truly going to 
get our cities moving forward, brownfields has to be considered 
a critical piece of that, of the tools to make that happen. 
Congressman English and Congressman Dent, thank you for being 
here, as well. Special thank you to Congressman Dent for when 
we passed the Land Recycling Program in Pennsylvania, the 
Congressman was then a member of the General Assembly and was a 
critical leader in that effort and also Congressman English, 
from the local effort in Erie for the International Paper site 
and the Erie Gunite site, those are critical excellent 
brownfield projects and we respect all of your leadership on 
those issues.
    Abe, who preceded me, we have the role that most 
environmental regulators are jealous of and that is we get to 
create jobs and clean up the environment, sort of one of the 
few jobs that people get jealous when you are an environmental 
regulator. And to my left is Jim Seif. Mr. Seif was the 
secretary that preceded this administration and the reason why, 
one of the key reasons why, the grid work is happening in this 
district in brownfields is his leadership on the issue. The 
Pennsylvania Land Recycling Program is a model for the Nation 
and without that, you would literally have thousands of people 
that would not have jobs today, you would have hundreds and 
thousands of acres that have not been cleaned up and you would 
have jobs that would not have been brought into Pennsylvania. 
Mr. Seif deserves a huge amount of credit for that, so I thank 
him for his efforts, as well.
    Before we go--or before I go--into recommendations, it 
might be good to talk about a little bit of how we got here 
today. Pennsylvania, prior to 1995, was, because of several 
brownfields, it would be the steel mills in this district to 
where I grew up in Pittsburgh, you are talking about hundreds 
and hundreds of acres of sites and thousands of jobs that were 
lost and in many ways businesses were prepared to give up on 
those sites. Pennsylvania passed through the first, or Act II 
of 1995 that Governor Ridge signed into law, the Land Recycling 
Program that offered the liability relief and also the cleanup 
standards that would be site specific to the sites, depending 
on what you wanted to use, whether it be housing, which would 
have very strict standards, to whether it be a parking lot, 
which would have lower standards, without compromising public 
health. That bill has helped spearhead the brownfield movement 
across the country.
    Moving forward, when Governor Rendell took office, one of 
the first things he did as Governor, was put together a 
stimulus package. A critical piece of that stimulus package was 
a $300 million investment called Business in Our Sites and that 
money was used to help local economic development corporations 
acquire sites, mainly brownfields, clean them up and also 
revitalize the infrastructure. That program has been put in 
place across the State now and they have now invested close to 
$200 million in revitalizing old industrial sites to prepare 
them to be pad-ready so Pennsylvania can bring jobs into them.
    Another issue that we have done is the Brownfield Action 
Team program. The Brownfield Action Team program has been a 
critical addition to the Pennsylvania brownfield arsenal. In 
fact, the Bethlehem site was the first Brownfield Action Team 
site in Pennsylvania. What we aim to do with the Brownfield 
Action Team is to equal the playing field between brownfields 
and greenfields by streamlining our permits so that we cut the 
permitting time in half and when communities designate a site 
as a priority site, we move those sites through the permitting 
process as fast as the law will allow.
    We also have a Memorandum of Agreement with EPA so that we 
become a one-stop shop. Pennsylvania is right now the only 
State in the country and while we are happy about that, because 
it has given us a competitive advantage, the reality is that we 
think every State in the country should at some point have that 
agreement with EPA so that we can move projects forward across 
the country on brownfields.
    What the Federal Government can do--and obviously we have 
talked about some legislation that is in before you, whether it 
be from the tax credit side or from bonding from Congresswoman 
Hart--the big picture is keeping in mind that we have to level 
the playing field, so whether it be from the permitting side--
maybe EPA and DEP could look at how we can bring our model of 
an MOA to the rest of the country--providing, perhaps, a 
streamlined permitting process for priority brownfield 
districts at the Federal level, or, also, perhaps some more 
flexibility on our EPA funding for the brownfields. I will 
commend Region 3 because they have been very cooperative with 
us on those programs, but we need to continue to work at ways 
to equalize that playing field from the funding side and the 
permitting side, because if the sites are not, if people that 
are investing feel that they are going to have too long a time 
of getting their permitting up or the funding will be too 
difficult to achieve, they will simply not invest in those 
sites, so we all have to work together to come to that common 
ground.
    [The prepared statement of Mr. DePasquale follows:]

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    Mr. Turner. Thank you. Mr. Seif.

                   STATEMENT OF JAMES M. SEIF

    Mr. Seif. Mr. Chairman, welcome to Pennsylvania and Mr. 
English, welcome to the Lehigh Valley and Charlie Dent, welcome 
home. It is good to have you. I will correct the record at the 
risk of not being gracious of the nice things that have been 
said. It was Tom Ridge that was responsible for the brownfields 
program in Pennsylvania, not Jim Seif.
    Mr. DePasquale. But you are sitting to my left.
    Mr. Seif. Tom Ridge was occasionally to my left, as well, 
but that is another--let me talk about what, I am going to 
depart from my testimony. It has that little anecdote about 
representing National Cash Register, which was an unfortunate 
event, where the adversarial system was used in a totally 
inappropriate place, which was to try to solve an environmental 
problem. That says it all about Superfund.
    Let me talk about what I think a successful recipe for 
brownfield statutes would be. First, you have to start with the 
recipe itself, a piece of paper and that piece of paper needs 
two things. They are mentioned in the bullets at page three of 
my testimony. You have to have a real cleanup, an actual, 
transparent-to-the-community, safe cleanup. This is not just 
paving stuff over and wishing for jobs. It has to be, the 
community has to agree to it. The risk standards have to be set 
sometimes State by State. I would not favor a Federal 
approbation of risk standards.
    Second, you need a piece of paper from the State or other 
authority that says you have done what you are supposed to do. 
That is what puts the property back in the stream of commerce. 
It has been prevented from being there by so many things, the 
long dissertation I have done about Superfund's failings as the 
principle example. It became legally toxic and people just let 
it go and that can't happen.
    The next thing you have to do is clear out the kitchen. 
There is some stuff in there that shouldn't be there. One, you 
have to administer the laws that are in place that are not 
toxic waste laws so that you create no more Superfund sites. To 
stop creating brownfields we have to conduct ourselves 
economically and environmentally the way the public wants us 
to, whether we are a company or whether we are administering 
statutes.
    And then you have to clean out Superfund. I think that has 
been done. I am among, you know, EPA has done a great job, like 
any reform center does and I was among the sinners. I was 
talking with Abe this morning when we worked together on 
Superfund. We did have to chase around a lot of people and with 
all the dysfunctions in the Superfund statute and the 
incentives to fight instead of get the job done, it didn't 
work. And I think the Federal Government got off to a wrong 
start administratively. It also got off to a start at a time 
when we didn't know what the dimensions of the problem were. 
There were thousands of these, not 128, which is what Jimmy 
Carter once thought. Thousands of them. We also didn't have 
ways to clean up stuff, technologies or money or administrative 
techniques and they had to be invented and since the Superfund 
program used litigation to invent, it took awhile.
    Looking more positively on what it takes, then you have to 
have not just the piece of paper and a clean kitchen, but a lot 
of stuff, a lot of ingredients, lots of cooks--lots of people 
like the second panel who get it about there is economic 
opportunity in land, that it is a commodity and it has value 
and it is not just something to stay away from. You have to 
have new technology and these people are good at inventing it. 
I think Mr. Colangelo will talk about his group which consists 
of hundreds of people in Pennsylvania, alone, who have an 
incentive economically and from the community point of view to 
make this thing work. Contrast that to Superfund, who had 
hundreds of lawyers whose career depended on making it not 
work. And this is a far more important bunch of people in terms 
of getting things done.
    You would have to have a sensitivity to land use. I think 
the sprawl debate has helped prevent some greenfields from 
being used and tipped the balance a little bit toward using 
land in Erie or Dayton or Bethlehem or Allentown. That has been 
helpful. You have to advertise like hell. Frankly, I have used 
the Henry Ford analogy. He didn't make better or more cars than 
anybody else, but he sure got out and sold a lot of cars. And 
people are concerned about these toxic sites. I think that 
concern has been considerably less over the last few years, but 
you have to do what we have heard Gene DePasquale talking 
about: get out and tell people about it. Use the Business on 
Our Sites program that Rendell has used or the Site Finding 
program that we instituted and just get out and make it happen, 
just as you would push any other asset in a State--good land, 
close in.
    You have to have good quality control. The sites have to be 
really cleaned up. You have to have KOZ kinds of items 
available. You have to have flexibility. You can put a 
playground where an old factory was if you do it right. You 
have to have a deal where you can get it wholesale, like our 
multi-site agreements. You have to have State variation. Not 
every State deals with risk the same way, deals with economic 
incentives the same way and if the 10th amendment is as strong 
as we have recently learned that it is, that will be a good 
thing.
    And into the mix comes tax policy, for which I commend the 
committee for looking at. There will be revenue consequences 
and there will be difficulties over how do we simplify the code 
and still do all these things and I will let Congressman 
English worry about that in his other committee. The fact is 
that it is not only Federal taxes, but local taxes that are a 
problem or an opportunity with brownfields. KOZ has solved, in 
some respects, the local problem, Keystone Opportunity Zone, 
which is a tax-free zone. But more could be done in those 
areas. I would be happy to talk about more war stories or more 
parts of the recipe if there is interest.
    [The prepared statement of Mr. Seif follows:]

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                    STATEMENT OF PAUL SCHOFF

    Mr. Schoff. Thank you. My name is Paul Schoff and I know 
that I am definitely to the left of Mr. Seif. It is my pleasure 
to address the members of the Subcommittee on Federalism and 
the Census and in particular, I am pleased and privileged that 
you would send an invitation to me to talk about brownfields 
here in the Commonwealth of Pennsylvania. My company, 
Brownfield Realty, LTD handled the first brownfield transaction 
under Pennsylvania's then new voluntary cleanup program [VCP], 
the Land Recycling Act, known colloquially as ``Act 2.'' 
Pennsylvania's VCP or brownfield law has provided a tremendous 
boost to the Pennsylvania economy by allowing a common sense 
approach to the handling of environmentally challenged 
properties.
    That first site, the Delta Truck Body site, if you take a 
look at exhibit A to my materials, had been on the list 
maintained by the Pennsylvania Hazardous Sites Cleanup Act 
[HSCA], for more than 3 years when we negotiated that first 
Consent Order and Agreement, with Pennsylvania's DEP Office of 
Chief Counsel. That order, which was dated October 31, 1995 was 
the first step in getting this property back into productive 
use and generating tax revenue and providing employment for the 
local community.
    Since that first site, Pennsylvania's DEP has approved the 
cleanup reuse of hundreds of sites and now 10 years later, it 
is clear that the Pennsylvania VCP is not only an unqualified 
success, but a model for other States to follow.
    As noted in my article written for ``Business Law Today'' 
in May 1997, at the time of the Delta Truck Body site 
transaction there was no Federal law allowing for risk-based 
cleanups. There was no Federal VCP. Since that time, Congress 
has passed legislation which provides for no Federal 
involvement, a process commonly called ``overfiling,'' on a 
State brownfield site, which is being remediated under a State 
brownfields program unless the State requests EPA action or the 
EPA determines that a continuing release presents an imminent 
and substantial endangerment to human health or the environment 
or where certain new information regarding the extent of 
contamination is perceived by the EPA as requiring further 
remediation. Notably, however, this law only limits EPA 
overfiling under CERCLA, the Federal Superfund law, while the 
EPA is free to pursue claims and enforcement under Federal 
environmental laws such as RCRA, TSCA and the like. 
Fortunately, in April of last year, Pennsylvania and the EPA 
executed a Memorandum of Agreement, or Memorandum of 
Understanding, which covers Federal involvement where CERCLA, 
RCRA and TSCA legislation is implicated and clarifies how sites 
remediated under Act 2 may also satisfy requirements for these 
three key Federal environmental laws.
    Since inception, Pennsylvania's Act 2 has allowed the 
cleanup and reuse of at least 1,712 sites. In addition to the 
enviable record which Pennsylvania has behind it, DEP has not 
rested on its laurels. The formation of the Brownfield Action 
Team, the Low-risk Sites Process, the Clean Fill Policy are all 
outgrowths of the original VCP program. Together with the 
Pennsylvania SiteFinder which has listed 485 properties since 
its creation in 2001, DEP has awarded 50 Brownfield Inventory 
Grants. These grants, together with the grants and low interest 
loans under the Industrial Sites Reuse Program, have all 
contributed to making Pennsylvania an extremely hospitable 
venue for new and existing businesses.
    It is also important to mention the use of environmental 
insurance products, such as stop-loss coverage, environmental 
impairment liability protection and cap cost policies, which 
have allowed questionable transactions to proceed with the 
assurance that financial resources will be available in the 
event unexpected contamination is found at a later date or if 
remediation costs end up exceeding preliminary estimates. These 
policies, together with the Pennsylvania brownfield initiative 
have permitted transactions to proceed in situations where 
uncertainty and speculation abounded regarding a particular 
site.
    It should also be noted that Act 3, which was part of the 
original package--Acts 2, 3 and 4--under Pennsylvania's VCP 
legislation adopted in 1995 provides protection for economic 
development agencies, lenders and fiduciaries. In my written 
materials I have gone into an analysis of exactly what that 
protection is for economic development agencies, lenders and 
fiduciaries. I don't know that it is necessary for me to go 
into that at great detail at this time, but suffice to say that 
a lot of the economic development agencies which Mr. DePasquale 
had referenced in his remarks would not have taken title to 
these properties, or acted as conduits, if this legislation had 
not been passed. Act 3 provides that protection. Act 3, as well 
as Act 2, is a model for other States.
    These protections for economic development agencies, 
lenders and fiduciaries, they all add up to providing key 
relief to an area which was fraught with danger. To that end, I 
believe Act 3 has been an unqualified success in providing the 
comfort required by these third parties in order to maintain 
reasonable control over their respective situations.
    If there is one bugaboo in the system, it is the 
increasingly popular policy of State environmental agencies 
seeking compensation for natural resource damages. While 
Pennsylvania has taken a common sense approach and has not 
proceeded to follow this path. Our sister State, New Jersey, 
has embarked upon an aggressive campaign to obtain financial 
recompense for responsible parties for the overall damage done 
to the State's natural resources as a result of migrating 
pollution.
    While the policy has surface appeal, if you take the 
argument to its logical conclusion, each one of us could and 
should be prosecuted for driving vehicles which contribute to 
the deteriorating condition of the air we breathe. My question 
becomes where does it end? In my humble opinion, while the 
States are free to govern their own affairs, U.S. Congress 
could require, by statute or regulation, that any existing or 
future MOUs or MOAs with States require prohibition on the 
recovery of NRDs except in the case of willful or malicious 
intentional acts.
    Notwithstanding the controversy of NRD recovery, my opinion 
is that the Pennsylvania program Acts 2 and 3 and 4 has been 
one of the finest legislative products produced by the 
Commonwealth and the fact that we are holding these hearings in 
the city containing this country's largest brownfield site, 
serves as further testimony as to the viability and vitality of 
the Pennsylvania program and the cooperation between the 
Commonwealth and the Federal Government. Thank you for 
extending the invitation to speak before your subcommittee. I 
thank you for offering me the opportunity to share my views 
with the members of the subcommittee. I look forward to any 
questions you may have.
    [The prepared statement of Mr. Schoff follows:]

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    Mr. Turner. Mr. Colangelo.

                 STATEMENT OF ROBERT COLANGELO

    Mr. Colangelo. Thank you. Good morning, Mr. Chairman and 
members of the subcommittee. Thank you for inviting me here 
today and I really commend each of you for tackling this 
brownfield issue and looking at alternative financial 
incentives to attract private sector investment. Government 
can't do it alone. It has to be a public/private partnership 
and now a lot of the easy brownfield sites have been done and 
in order to attract the private sector, we need more innovative 
financial solutions.
    The National Brownfield Association is a nonprofit 
educational organization and we have more than 900 members, 
property owners, developers, investors, service professionals 
and representative governments who are all dedicated to the 
responsible redevelopment of brownfields. And one of my 
pleasures is that I get to travel the country working with a 
lot of States on their brownfield programs, so I think I can 
offer you a unique perspective on what is happening in the 
brownfield market.
    The NBA has a longstanding relationship with the State of 
Pennsylvania. Pennsylvania DEP was one of our founding members 
under Governor Ridge and Secretary Seif, and you know, we 
learned firsthand just the quality of people that are involved 
in the agency and the innovativeness that has come out of the 
agency and its programs. And also, just recently, we launched 
our NBA Pennsylvania chapter working with Secretary McGinty and 
Deputy Secretary DePasquale. And that has been a great success. 
That chapter started out with 100 people. There is a very 
strong interest here in Pennsylvania and you have a very 
sophisticated market with a number of highly skilled 
specialists.
    I can attest that the Land Recycling Program, through Act 
2, 3 and 4 is innovative and it is innovative because owners 
can secure liability relief. The program is unique because it 
has flexibility. The applicant can choose the type and level of 
cleanup based on end use. And it also requires the Department 
have timely response so that they can move at the speed of 
business, which is very important in the development community. 
And then last, it provides an array of financial incentives and 
technical insistence.
    Additional program innovations under the current 
administration include the MOU that Deputy Secretary DePasquale 
mentioned and it is so important that you can offer a broad 
range of brownfield sites, such as RCRA, CERCLA and TSCA to be 
included under the brownfield program. And so this MOU, I 
think, is a model that other States will start to emulate. And 
then last, the formation of a department of revitalization, 
local government support, which really gives an emphasis to 
making brownfields a redevelopment issue is very important and 
we strongly support this and we hope that hits a trend that 
other States will soon follow.
    The act program incubated under Governor Ridge and 
Secretary Seif was nationally recognized for its innovative 
solutions, but probably one of the most important things that 
happened under that time was that they marketed that program 
very aggressively and not only did that raise public awareness 
in Pennsylvania, but it really raised public awareness of the 
whole brownfield issue. They were the tide that floated all 
brownfield boats and it really increased the level of interest 
out in the National marketplace and now I could say that there 
is 5,000 to 10,000 people that make their livelihood in 
brownfields. And so again, I really commend Congress. I am not 
sure if they knew they were creating an industry, but there is 
a whole industry out there of people that make their livelihood 
out of redeveloping these sites and a lot of that stemmed, you 
know, through the Pennsylvania Department of Environmental 
Protection's aggressive efforts to market their program and it 
had National repercussions. And that effort has been continued 
now under this administration. But the State can't, you know, 
tackle brownfields alone. It requires a partnership with the 
private sector. And the government's role, I think, is best as 
a facilitator and the administrator of programs that reduce 
risk and attract private investment.
    For government incentives to be meaningful to the private 
sector, they need to be predictable and consistent, be easy to 
understand and administer, applied to a wide type of projects, 
allow flexibility in the use of funds and provide meaningful 
funding amounts. And I think Pennsylvania has many of those 
elements. As time goes on, fewer easy-to-develop brownfield 
sites are available, and so cities are going to be left with 
the harder, more complicated sites and these have to have 
financial incentives to attract private sector investment.
    Chairman Turner, I personally commend your efforts to look 
for a financial solution and support the legislation similar to 
H.R. 4480, which allows a Federal tax credit program to deduct 
demolition and remediation expenses. As you draft language for 
the bill, I encourage you to consider allowing for these 
credits to be traded on a secondary market. I think this would 
further enhance their value and would stimulate more private 
sector investment. And again, thank you very much for asking me 
to present my comments. Also, the NBA has recently created an 
analysis of State voluntary cleanup programs and recognizing 
that no State has the best program, but many States have great 
elements, we put that forth in our analysis and I encourage you 
to look at that as a resource. Thank you.
    [The prepared statement of Mr. Colangelo follows:]

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    Mr. Turner. Excellent. Thank you so much. We will go to Mr. 
Dent for the first questions.
    Mr. Dent. OK. Thank you, Mr. Chairman. Thank you all for 
your testimonies. It is very helpful. Secretary DePasquale, you 
talked a bit about the allocation of Federal moneys and how 
they are too restrictive and that States with established 
programs should be afforded greater flexibility with those 
Federal dollars. Explain how this increased flexibility would 
assist in a greater efficiency in rebuilding communities and 
you know, what we should do, you know, legislatively to help 
you get that flexibility?
    Mr. DePasquale. Here is, I mean, the simplest answer is 
that, you know, some of the money that we are allocated needs 
to go into marketing of brownfields or even of the program, and 
that is money that we think, at this point, we have 
significantly marketed the brownfields program. I mean, people 
that are doing economic development in Pennsylvania know about 
the tools that we have and we certainly can go out to forums 
like this and use those efforts to market what we have. We 
think that, for States that have established programs and 
people already have a familiarity with what we do, that money 
would be more effective going straight into remediation. So if 
you have an economic development deal you are trying to put 
together and you already know about our brownfields program, 
but one of the pieces is you need $250,000 of remediation money 
to make the project go and so again, when we talk about 
leveling the playing field between greenfield and brownfield 
sites, and this is one that Region 3 has been working with us 
to increase the flexibility of what we can do in Pennsylvania, 
but we do know that is something that if we could use all of 
our money for remediation and that would be very helpful.
    Mr. Dent. So OK, you would just like to be able to use all 
that money for remediation?
    Mr. DePasquale. To have the ability to use it.
    Mr. Dent. OK.
    Mr. DePasquale. There may be some instances where we would 
need to use it for marketing, but I can tell you that if we 
were able to use all of our money for remediation, that would 
be something that we would likely do.
    Mr. Dent. Do you think that would require an administrative 
change or a legislative change?
    Mr. DePasquale. I think it would be more, my sense is it 
would be more administrative. That would be my sense.
    Mr. Dent. And my second question, final question for you, 
Mr. DePasquale, deals with liability relief. What can the State 
and Federal Government do to get on the same page with respect 
to liability relief?
    Mr. DePasquale. Again, with the MOA, between EPA Region 3 
in Pennsylvania, I think we are getting pretty close to nailing 
this, you know, threading that needle. But I do, possibly what 
we could do, you could even have, whether it be Abe and myself 
taking a little road show out to other States or simply using 
this forum with your committee to inform other States as to 
what, and other regions, as to what is happening. And you know, 
I don't know if that is taking place on from a larger level, 
from EPA headquarters, but I do know that is, that I think 
sometimes at some level, it is just letting people know what we 
are doing, because when you talk about a one-stop shop, we were 
in a situation where we were trying to, you know, nail down an 
economic development deal in the north central part of our 
State and we were in the process of losing it and then during 
the conference call, I informed them that we had an MOA with 
EPA for the brownfield program and the tenor of the discussion 
immediately changed. They didn't realize how quickly you can go 
through the EPA and DEP process on a brownfield site and so 
that enabled us to secure it.
    Now, there is somebody at a pay grade higher than me that 
will announce that project in the near future, so I don't want 
to be taking away any of their gusto, but I do, I can tell you, 
without the project's name, that is something that happened 
within the last week in a conference call. And so that is a 
project that easily could have gone and they would have just 
bought 50 acres of a greenfield site and gone there as opposed 
to reusing an old industrial site.
    Mr. Dent. And quickly, to Jim Seif, in your testimony you 
almost go as far as to say that Superfund should not have been 
passed. You didn't quite go that far, but what led you to such 
a conclusion and just tell us again what your thoughts are with 
respect to the distinctions between what we have done here in 
Pennsylvania, what you did, largely, in Pennsylvania with 
brownfields and contrast that to the Superfund experience.
    Mr. Seif. I think Superfund is one of the least successful 
Federal environmental statutes of my professional lifetime, 
which goes back to the founding of the agency. And it simply 
took the wrong premises about the nature of the problem and 
about the sub-decisions you would have to make to get it to 
work right, you know, how clean is clean and so on and 
miscalculated what, how large the task was. Like prohibition, 
there were certain wrong premises about the public response to 
the prohibition that was settled upon. But we sort of had to do 
it that way to learn what the right way was. We had to go down 
some wrong paths to decide, wait a minute, how can we make this 
faster, you know, time is money, when they learn that you can 
get a State and Federal judgment at the same time. That took 25 
years after the passage of Superfund. How can we decide how 
clean is clean, can it vary by site? We concluded that it 
could. Can we just cap stuff? We concluded that we can. But 
those were big fights.
    And I guess we had to have those fights to learn that the 
answer should have been we didn't have to have those fights. 
That is the way policy gets made, I guess, in a democracy, 
disjointed incrementalism it has been called. But I think the 
Superfund taught us a lot of lessons. It gave us a lot of 
expertise as physical, chemical, medical risk expertise that is 
now part of the tools that go together to make a good 
brownfield program. Yes, I would have passed it. I guess I 
would have. It might have been that we could have made it worse 
so that it would have taught us faster, but we didn't and here 
we are. I think all is well that ends well.
    Mr. Dent. And one more.
    Mr. Turner. Sure.
    Mr. Dent. And finally, Jim, same question that I gave to 
Mr. DePasquale. What do you think we should be doing at the 
Federal level to give you greater flexibility or funding? What, 
specifically, do you think we ought to do to make the efforts 
we have seen in Pennsylvania even better on brownfields?
    Mr. Seif. In Pennsylvania, not very much. I think that with 
tax relief, Federal or property tax, which we know is a huge 
debate in our Commonwealth right now, there might be a few more 
dollars added. And when you are dealing with a decision between 
this piece of land or that piece, $12.50 can swing a deal. It 
can be the lubrication that is needed to make a decision go 
faster and the tax element is always part of a deal. I would 
not wish to see the tax element become so large that deals are 
made because of it. I think deals have to be good deals, good 
cleanups, good commercial outcome and so on, and tax can help. 
Again, with reference to the revenue implications of it all and 
the simplification issues that I think would be helpful to 
everybody, we probably ought to be doing that. Property tax 
abatement is not a Federal Government issue, but there should 
be some encouragement, possibly even Federal grants to 
communities that provide that abatement so that it is less 
painful and they get a quicker payoff on the bringing of the 
jobs and the redeveloped property back onto the tax rolls.
    Mr. Turner. Thank you. Mr. English.
    Mr. English. Thank you, Mr. Chairman. One of the things I 
found most encouraging about the evolution of brownfields 
policy is that since we got started, there were new 
technologies available that are actually bringing down 
radically the costs of doing cleanups. There have been some 
examples. For example, biologicals that are now being used to 
break down poisons in the ground rapidly and allow for what 
would have been fantastically expensive cleanups with huge 
movement of earth to be achievable in a fairly unintrusive way. 
What sorts of changes need to be made in the Federal program to 
make it easier to introduce these new technologies? Mr. Seif.
    Mr. Seif. You are right, and Superfund engendered those 
technologies as capitalists desperately looked for ways not to 
dig up thousands of tons of Earth, burn it and bury it 
somewhere else, which was often required, even in these big 
landfills where NCR got caught in.
    We have since learned that a variety of new techniques can 
be used, many of them developed in the private sector, which is 
the best place to develop anything, in my view. It saves the 
taxpayers a lot of money, but in the energy area, and because 
of the most recent energy bill, there will be a lot of 
investments in clean coal technology and that will have an 
enormous benefit in Pennsylvania and Ohio and elsewhere because 
you have a lot of old abandoned coal sites, or grayfields, if 
you will. The coal that we used to throw away is now, has 
enough BTUs in it to make it worthwhile going after and you can 
make diesel fuel out of it. That is what we have done in 
Schuylkill County shortly here and do other things. The Federal 
Government has really stepped up to the plate in the most 
recent energy bill in helping that happen.
    You can also prevent more grayfields from being formed if 
there were more nuclear power. That is way off the topic of 
this meeting, I understand, but it is clear that if nuclear 
power came to us now with the global warming effort, the 
enviros would be saying what a great thing. And we perhaps 
ought to turn in that direction for the variety of reasons that 
we are all familiar with. But the Federal Government can 
incentivize at fine universities, especially like this one, the 
development of more technology, but not be the developer 
itself, obviously, and let the private sector judge which one 
makes it in the market and which ones don't.
    Mr. English. Mr. DePasquale, in applying these new 
technologies, do you see any way that we should be refining or 
sharpening the Federal program to make it possible to introduce 
them more quickly?
    Mr. DePasquale. I think that some of the tools are already 
there and Don Welsh, who is the Region 3 Administrator, has 
shown his leadership in being creative with the MOA. I think 
that across the board, whether it be environmental protection 
agencies across the country at the State level or even all the 
regions in EPA and Washington, you need to have a culture of 
creativity and, because I believe the tools are already there, 
and you need to have, you know, people that are committed at 
the higher level of the agencies and also at the lower level, 
that are committed to being problem solvers on these issues 
because the tools that you raise in the question are already 
there. I mean, I don't think that you really need to pass new 
legislation, I think, you know, maybe it is banging away at it 
to make sure that the people who are listening both at the 
State and Federal level that they need to be creative and find 
solutions because, you know, in a, to be fully honest, if you 
think everyone in the DEP in Pennsylvania is really throwing 
parties because of what I do, it is not the case. I mean, 
sometimes you have to really work to get people to come to the 
table and figure these things out, but I am fortunate to have a 
boss like Governor Rendell and Secretary McGinty that back me 
up on these things. And I can imagine that for Abe doing some 
deals at the Federal level, he has similar issues. It is a 
culture of creativity that needs to be a match from the top on 
down.
    Mr. English. Mr. Colangelo, do you have anything to add 
from your perspective with your association?
    Mr. Colangelo. I would say training, education and outreach 
is, this brownfields market is constantly changing. Each year 
the USCPA hosts a brownfield conference and the numbers have 
grown each year. This year they are looking at 5,000 people in 
Denver and the interesting part of that is that there are so 
many new faces each year as this rotates around the country. 
And so when you are talking about new technologies or new 
processes, all these new entrants into the market need to be 
trained and they need to understand, you know, how they apply 
and what changes have taken place. And that goes for all the 
stakeholder groups, too, you now, working with the property 
owners, working with the developers, you know, working with the 
investors. And again, you know, Pennsylvania had gone through 
some budget cuts and to say it politely, but they were really a 
lead marketer and that hurt the whole industry when that budget 
got cut, so providing that constant outreach and education and 
training internally and to the stakeholders, I think, is 
something that has to be done continuously.
    Mr. English. Thank you, Mr. Chairman.
    Mr. Turner. Thank you. Mr. Seif, one of the things that you 
related to us when you talked about the two points that need to 
occur is the issue of getting a piece of paper or a release and 
understanding of your liability. The question that I have for 
the panel relates to a portion of my brownfield tax credit 
bill, which is No. 4480, and that is the goal of providing that 
type of relief to individuals that come in and redevelop 
brownfield sites or even a past polluter that has joined in the 
redevelopment and the cleanup of the site.
    A brief overview, again, the bill provides a 50 percent tax 
credit, it doesn't provide 100 percent of the funding, but the 
tax credit can be applied to environmental remediation and 
building demolition to the extent that buildings need to be 
removed with respect, as part of environmental remediation. It 
also includes petroleum. The goal of providing relief to 
individuals who utilize the tax credit, initially, in the 108th 
Congress, the bill provided a release if the past polluter came 
to the table and funded portions of the remaining environmental 
remediation and the individuals that were redeveloping it, 
also, were able to avail themselves of liability relief.
    And in working with the Real Estate Roundtable, we have 
narrowed that as a result of a number of objections that people 
had who, on the environmental side, were very concerned about 
another form of relief or release being provided. And we were 
encouraged to fashion the bill so that there is a requirement 
now that individuals availing themselves of the tax credit 
would have to go through the volunteer cleanup program, and 
through the volunteer cleanup program, they would then receive 
their relief from liability that they would be seeking.
    One of the issues that we have, obviously, Mr. Schoff, your 
summary in your testimony of your Business Law Today article 
where you talk about the 2002 bill, the Small Business 
Liability Relief Act, and the relief that it provides under 
CERCLA, but the failure to include RCRA and TSCA that the MOA 
with Pennsylvania encompasses, raises an issue of there are 
several States that do not have that opportunity of providing 
their volunteer cleanup program developers or past polluters 
this type of relief.
    And I would like, if you will, one, to talk about the issue 
of how difficult was it to accomplish including all of those. 
Since the 2002 bill did not specifically include RCRA and TSCA, 
did Region 3 have difficulty in coming to the table and 
providing that umbrella with Pennsylvania, and from that, then, 
is there a need for additional legislation to enable EPA to do 
that on a routine basis so that the 2002 Small Business 
Liability Relief and Revitalization Act would recognize that 
both EPA and the States are encouraged to have a more broader 
MOA? From Pennsylvania's standpoint, how critical has it been 
for it to be a full umbrella, how difficult was it to include 
it? And if the rest of you could talk about the issue of the 
need for that relief and what you have seen and experienced. 
Mr. Ferdas.
    Mr. Ferdas. OK. First of all, I want to say that one of the 
major events in Superfund was a realization that private people 
can do the work better than us. We basically went into a so-
called enforcement first, so we basically encouraged the 
responsible parties to do the cleanups and Region 3 right now 
is 80 percent of all the cleanups are being done by responsible 
parties and that is what gives the credibility and the 
creativity to the cleanups. And one other point is a major 
development is also going on in the assessment side in the 
sense that we are getting better and better tools to sample 
things in the field and that is also reducing significantly the 
amount of cost of assessing aside, which is the first step for 
that.
    And that, just following with your question, I think that 
what we did in Region 3 in Pennsylvania is we figured out how 
to deal in the back room in the sense that we still have the 
whole RCRA structure clicking away, but it is hidden. It is 
basically taken care of in the back room and if there are any 
problems, obviously, we will say it and we have the authority 
to say it, but basically, it is done invisibly, transparent 
from the person who is trying to do the development and I think 
that is a key issue and we never claimed that RCRA went away, 
that TSCA went away. They just, we made it transparent to the 
person that is coming in and Pennsylvania understands those 
laws and they can do it. So I mean, I obviously can't say that 
we should change RCRA. I mean, I am not in a position to say 
that, but I think what we did was actually come to a solution, 
which is just make it transparent to the person that is coming 
in.
    I mean, TSCA has even more severe problems than RCRA, I 
think, because of the different regulations and so on and so I 
think that, you know, I can't talk about changing the law, but 
what I am saying is we found a way to kind of do it transparent 
from the people who are trying to get help to develop.
    Mr. DePasquale. I mean, my response would be it depends on 
whether you are trying to find a way to get the yes or trying 
to find a way to get to no, and in our region and with DEP, we 
are trying to get the yes. So when it comes to the umbrella 
side, yes, there is this Memorandum of Agreement, but as you 
can imagine, when it comes to day by day, I mean, there are 
things that develop that are somewhat outside of that agreement 
or there are problems that you didn't know about or you know, 
like Jim has been banging away at this for a couple years more 
than me, maybe two or three more than me. There are things that 
you need to get better at over time and so the best way I, you 
know, just really would echo what Abe has said and that is we 
really get in project by project sometimes to figure out some 
of the new challenges that come up inside of this umbrella 
agreement that we have, so you know, you can pass a law and 
sometimes that will make it, you know, enforce what we are 
already doing, but again, sometimes I don't want to give people 
an out. There are already the tools to make this work.
    Mr. Seif. The transparency issue was the most important. 
The developer doesn't care under which statute or under which 
sovereign it is that he can proceed, he wishes to proceed. And 
it is incumbent upon public servants, if they wish to be called 
servants, to figure out how to help. Forcing standards to be 
sure, but to make it happen. It also occurs to me that any 
scheme, mix of Federal and State cleanup laws, regulations and 
people needs not to make any distinction between past polluter, 
future user and all that.
    There is no such thing as a polluter on most Superfund 
sites, either in the legal sense, because they are long gone 
and their grandchildren are in California, or in the sense that 
you still have a viable company and what it did in 1942 was 
make products that we all bought for less cost than they would 
be today because the practice was to throw it out in the back 
40. Not blameworthy, maybe not nice and neat, but the point is 
when we go after people, common term used in the bureaucracy or 
when we call people, make the polluter pay was the 
congressional mantra when Superfund was passed. Well, you are 
looking at a polluter and you would find that same polluter in 
the mirror.
    The fact is, it is a public problem most severe in States 
like ours which have an industrial legacy that we ought to be 
proud of and not point fingers about, so when we enable a 
cleanup, statutorily or otherwise, we ought to say everybody 
welcome, do your part and that excludes date cutoffs about 
eligibility for certain tax credits. It includes petroleum 
because that was an inexplicable omission in Superfund, well, 
explicable in a certain way and not explicable logically. And 
we also ought to, for the benefit of the public, require the 
use of the program that exists in a given State because that 
program was passed by the general assembly or the legislature 
and it is administered in a public and, we want to hope, 
transparent way, and the community ought to have whatever the 
other parties are up to, some confidence that there is a 
procedure that is common to everybody.
    And the people who are developing other sites ought to have 
some confidence that no shortcuts are being made by their 
competitors. So there ought to be whatever the package that is 
developed ought to have those characteristics, in my opinion.
    Mr. Turner. Mr. Schoff.
    Mr. Schoff. I will keep my remarks very brief. Just two 
points, Chairman Turner. One is during Mr. Ferdas' initial 
testimony he said that it was important that the consumer or 
the taxpayer had a one-stop shop and I think it is very 
important in order to have a one-stop shop. And before the MOU 
or the MOA came into effect, you still had the concern that 
``Gee, if it was something covered by RCRA or TSCA, you know, 
the legislation which was passed in January 2002 is not going 
to cover it.'' So you still have that potential risk. In the 
back of your mind you are thinking, ``Well, the EPA could still 
come in and do this. They could come in, they could do an 
overfiling, they could say, `Alright, we know you are under the 
Pennsylvania program, but under our auspices, now, we don't 
think that meets muster.' '' To have that one-stop shop is 
critical from the private sector's standpoint, you know, to 
know that you have complete protection, that you only have to 
deal with the agency on a one-time basis. That is very, very 
important.
    The second point I want to make, I guess, is that the 
easiest thing to do would be to amend the 2002 legislation to 
include protection under all Federal environmental laws, not 
just under CERCLA. Like Mr. Seif had indicated, for CERCLA not 
to include petroleum, I mean, I can tell you from a practical 
standpoint, the vast majority of brownfields out there have 
some petroleum contamination, some petroleum constituent. I 
think everyone would agree with that on this panel. Sure, you 
want to make sure that the dioxin sites are very carefully and 
very detailed, examined, that they have a very high level of 
scrutiny and the potential for damage to the health, safety and 
welfare of the individuals and the public is very high there. 
But for sheer numbers standpoint, you have industrial solvents, 
you have petroleum, you have leaking underground storage tanks. 
A lot of these are petroleum based. CERCLA doesn't touch that. 
That is RCRA and other Federal environmental statutes.
    If the 2002 legislation were to be amended to include 
protection for under all Federal environmental statutes, I 
think that would go a long way toward easing a lot of people's 
fears and putting their fears to rest once and for all.
    Mr. Turner. Mr. Colangelo.
    Mr. Colangelo. Thank you, Mr. Chairman. According to our 
research, there is about $4 to $6 trillion of industrial 
property in the United States and corporations own about 40 
percent of that. And we estimate that somewhere between 20 to 
50 percent of it is environmentally impaired. And those sites 
aren't coming to market because of this reason. And I think 
that is the next evolution for the brownfield market is dealing 
with this liability relief for liability clarity for the 
potentially responsible parties and you know, the key there is, 
I think we all agree in polluter pays, the question is how much 
and there is a whole group of companies out there that are 
willing to voluntarily clean up their properties to the 
suggested standards through the State voluntary cleanup 
programs if they can get off the hook and right now, we have a 
double standard. A developer or a perspective purchaser can buy 
a property, enter it into the program, clean it up to the 
standard, get liability relief, but the property owner can't. 
And so I think that is the next issue that needs to be fixed, 
you know, using a combination of the State oversight insurance 
or a third party fiduciary to help, you know, look at the long-
term stewardship of this are all ideas that I think have some 
efficacy in this area.
    Mr. Turner. Thank you. Mr. Dent.
    Mr. Dent. Yes, I am just going to ask one fairly quick 
question to both Paul Schoff and to Jim Seif. Paul, you 
mentioned the policy of State environmental agencies that are 
seeking compensation for National resource damages. You 
discussed the approach taken by New Jersey, I think, in 
particular to obtain financial compensation for the damages 
suffered by natural resources. Can you explain your suggestions 
to how Congress could assist in helping this trend with regard 
to existing and future MOAs?
    Mr. Schoff. Sure, I will be happy to. It is a subject that 
is near and dear to my heart. Natural resource damages is a 
concept which, I am not sure exactly where it began, but I know 
New Jersey has taken a fairly active role where they believe 
that, or at least it is the policy is such, that if there was 
damage to the State's natural resources in any fashion as a 
result of contamination from a particular site--for instance, 
if groundwater had been affected and migrated to a field, to a 
stream, to a river--if there was anything which affects the 
natural resources of the State, there should be compensation 
paid by whoever did this pollution. Which, if you just listen 
to it, it sounds like it actually makes sense except for the 
fact that there is, the real question is where do you draw the 
line?
    And it may be a combination of things that have caused that 
contamination. It may be a combination of contamination from 
several different sites that have caused pollution of a 
particular stream bed or a river. It may be the wind blowing 
contaminated soil from one site to another. There is three 
media that contamination can exist in. There is air, there is 
water and there is soil, you know. Right now, if you take a 
look at their policy, they are focusing on soil and water, 
especially on water. But, as I said in my remarks, I mean, 
everybody could be held liable for fouling the air we breathe 
because we drive cars that pollute the air.
    The real question is where do you draw the line? I think it 
is sort of taking the, taking something, an idea which has 
surface appeal and then just magnifying it, saying well, we 
just need to get compensation for any damages which were ever 
done to any natural resources of the State.
    As I mentioned in my remarks, one of the things that 
perhaps could be considered is to have EPA institute a policy 
that they won't sign an MOU or MOA unless NRDs, natural 
resource damages, are excluded. That may provide some 
incentive. I mean, ultimately, it is a State issue, but from a 
Federal standpoint, I would imagine that would be one way that 
the Federal Government could get a handle on it by having the 
EPA say this just doesn't make sense.
    In some ways, it is almost a throwback to the old days of 
CERCLA where, you know, we are going to clean it up to pristine 
Adam and Eve standards, which is just as, it is just not 
practical. And you end up, you know, the people that you want 
to get to pay end up being people that are not the people that 
did the pollution to begin with. You know, they may be people 
who purchased the site, cleaned it up for whatever was there at 
the time, from the previous owner and yet, they are still being 
hit by natural resource damages because the site, itself, 
contributed to those damages. It would seem to me that, you 
know, one way of dealing with that would be through the EPA.
    Mr. Dent. Finally, Jim, just a quick question for you. You 
participated in the MOU agreement, the signing ceremony down 
here, a few blocks from here a few years ago.
    Mr. Seif. Yes, I did.
    Mr. Dent. If that agreement had not been signed by DEP and 
EPA at the time, do you believe that we would be able to 
redevelop that 1,800 acre tract of land?
    Mr. Seif. I have it on the authority of Hank Barnett, the 
president emeritus of Bethlehem Steel and you will hear, I 
think, from Steve Donches, that answer would be no. There are 
other sites that the company owns in other States that were 
closed at the same time and have had no further progress made.
    Mr. Dent. So that agreement is really what facilitated all 
the activity we are seeing down there today?
    Mr. Seif. Essentially. Tom Ridge would say so, as well, I 
might say.
    Mr. Turner. Gentlemen, I want to thank you for both the 
time that you prepared for this hearing and also your 
participation in it and I also thank you for your expertise 
that you lend to our communities as we tackle this tough issue 
and I want to give you one opportunity for closing remarks. If 
there are things that we didn't ask you that you wanted to add 
to the record or things that you thought of since you have 
heard other people's testimony that you would like to add to, I 
want to give you one opportunity for those closing remarks. 
Would anyone like to add anything to their testimony? Mr. Seif.
    Mr. Seif. One of the most sensitive Federal/State relations 
areas in the environment is the overfiling situation, whether 
it is a water case, a Superfund thing. It is a really sticky 
thing causing lots of disputes. I don't know that you can 
legislate borders that prevent those kind of disputes. The real 
solution to this and indeed, to the problem of natural resource 
damage suits is to have smart Governors appoint sensible DEP 
secretaries and so they don't fight with them. I am not saying 
that has been done in Pennsylvania, but I do believe that 
results show less strife and more progress than elsewhere, 
where I have seen real blowups and in my own history at EPA, 
between--Abe recall West Virginia on just about every case and 
progress was not made. You really need to be sensitive in 
legislating not to create new opportunities for those kind of 
struggles and to count on the training and other kinds of 
things that people who want to make these sites work can bring 
to the table and the fact that people who really want cleanups 
would rather not fight, they will just figure out how to do it 
right. The private sector is that way. Time is money. Fights 
are losers.
    Mr. DePasquale. Yes, under the Commerce Department there is 
the Economic Development Administration and while that is maybe 
not necessary for this panel here to have jurisdiction over, 
but it may be something to take back to your colleagues and 
that is as much the EDA/NPA has some funding to help with 
remediation, Commerce has the big money to help put some deals 
together. When I was director of Economic Development in the 
city of York, we did a brownfield project and the key was EDA 
money. They brought in $1 million and that is the whole of what 
we get in Pennsylvania from EDA and again, I am not saying that 
is bad, I mean, but that is just where the two agencies are 
limited in funding.
    I would take back to your colleagues that EDA, that 
funding, considering the President's priority he has put on 
brownfields, that is another pot of money that when you think 
about that can be targeted to brownfields across the country 
and there is no real stipulation one way or the other right 
now, I mean, but that is an area where they could really focus 
on helping to revitalize the cities by using that money, also, 
for remediation in putting together economic development 
projects in the cities across the country, so that is another 
piece that I wanted to make sure that I made you aware of.
    Mr. Schoff. Just very quickly, I just want to thank the 
subcommittee for taking the time to go into this and this is 
just, it is one of the--Acts 2, 3 and 4 in Pennsylvania--are 
one of those few pieces of legislation that really, really 
works and I really have to hand it to then-Governor Ridge and 
to Jim Seif for putting in place a program which really has 
been exemplary and from the private sector has been a 
tremendous boon and as Bob Colangelo told you, it has been a 
model for the country, you know, and has spurred development 
throughout the country, so really kudos to that administration 
for doing this and for following up, and with this 
administration for following up on Governor Ridge's program.
    Mr. Colangelo. I mentioned earlier that this brownfield 
market is growing and one of the things, as the market matures, 
is that there is starting to be a big economic divide between 
the ``have'' and ``have-not'' cities and so one of the things 
that we need to look at, as an industry, is how do we help some 
of these smaller cities on the other side of the economic 
divide? As the market matures, all the developers, investors 
want to do the big projects in the well-located areas and they 
don't want to tackle the smaller brownfield sites in the cities 
without strong market demand. And so I think that is something 
that we are going to have to collectively look at, is there 
special incentives or what can we do, as an industry, to help 
provide extra relief for those smaller cities, because many 
times that is a harder problem for that city. They don't have 
the resources and they lost a big job base when that factory 
closed.
    Mr. Turner. Good point. Well, gentlemen, I want to thank 
you so much again for your time here and with that, then we 
will be turning to our second panel. Our second panel includes 
Kerry Wrobel, president of the Lehigh Valley Industrial Park; 
Chad Paul, chief executive officer of the Ben Franklin 
Technology Partners; Ray Suhocki, president and CEO of the 
Lehigh Valley Economic Development Corp.; and Stephen Donches, 
president of the National Museum of Industrial History. If you 
gentlemen will come forward. To let you know, I am going to ask 
you to take the oath, which means that you will be standing. If 
you would like to set your materials down and remain standing, 
we can just proceed directly to the oath. Gentlemen, it is the 
policy of this committee that all of the witnesses be sworn in 
to testify.
    [Witnesses sworn].
    Mr. Turner. Please let the record show that all witnesses 
have responded in the affirmative. Kerry, we appreciate the 
tour that you gave us this morning and it was wonderful to see 
the site and your success. We look forward to your testimony 
and we will begin with you.

STATEMENTS OF KERRY WROBEL, PRESIDENT, LEHIGH VALLEY INDUSTRIAL 
   PARK, INC.; CHAD PAUL, JR., CHIEF EXECUTIVE OFFICER, BEN 
 FRANKLIN TECHNOLOGY PARTNERS; RAY SUHOCKI, PRESIDENT AND CEO, 
LEHIGH VALLEY ECONOMIC DEVELOPMENT CORP.; AND STEPHEN DONCHES, 
        PRESIDENT, NATIONAL MUSEUM OF INDUSTRIAL HISTORY

                   STATEMENT OF KERRY WROBEL

    Mr. Wrobel. Thank you, Mr. Chairman. Good morning. My name 
is Kerry Wrobel and I am president of Lehigh Valley Industrial 
Park. LVIP is a private, nonprofit economic development 
corporation, which ironically was founded due to a 100-day 
strike at Bethlehem Steel. Today LVIP is constructing its 
seventh industrial park on 1,000 acres of the former Bethlehem 
Steel plant in the city of Bethlehem. As in our previous six 
parks, we envision a premier business center with diverse uses, 
manufacturing, technology, distribution, office and retail, all 
in this major brownfield site that we call LVIP VII at the 
Bethlehem Commerce Center. LVIP's first six parks converted 
greenfields into business centers. Our success, 1,500 acres of 
industrial development, 370 companies and 17,000 employees, has 
played a supportive role in diversifying the Lehigh Valley 
economy and ultimately, weathering the loss of Bethlehem Steel.
    While developing our greenfield park over the past 15 
years, LVIP kept a watchful eye on opportunities to redevelop 
an urban brownfield site. In June 2001, Bethlehem Steel 
approached LVIP with just such an offer to develop a major 
portion of the company's South Bethlehem plant. I have to give 
credit to Steve Donches, who made the phone call to LVIP. We 
purchased 1,000 acres of the plant in May 2004. LVIP VII at the 
Bethlehem Commerce Center will cost approximately $100 million 
to develop, and that is just infrastructure alone. That is more 
than our previous six parks combined. LVIP, a land developer, 
will construct roads, as you saw this morning; utilities and a 
108-acre intermodal facility. We are addressing all 
environmental issues on the site and we are preparing the 
parcels for end users.
    And progress can be seen already this afternoon. In fact, I 
will leave here and attend a ribbon cutting ceremony for our 
first tenant, U.S. Cold Storage, a firm based in Cherry Hill, 
NJ, and Cold Storage has constructed a first phase 175,000 
square foot facility with 38 employees on LVIP VII's 32 acres. 
At full build-out, they expect a 625,000 square foot facility 
and 200 employees.
    Perhaps no other issue resonates as soundly with today's 
populace as the continual march of suburban sprawl. As farms 
give way to residential and commercial developments, there is a 
clear understanding that public policy and regional planning 
must incent and direct the reuse of urban sites. If we are to 
rebuild our cities and prioritize brownfields, the public 
sector must invest public dollars to offset the premium costs 
associated with brownfield development. Here are a few of my 
recommendations.
    As Secretary DePasquale just mentioned, allocate a fixed 
percentage of EDA funding annually for brownfield development. 
LVIP VII received a $2 million EDA grant for the construction 
of infrastructure in its first phase. The grant offsets the 
significant premium costs of trenching for utilities and roads 
through 20 foot foundations and 5 foot slabs. By offsetting the 
premium costs, the EDA grant has allowed LVIP to sell its land 
at a price that is competitive with greenfield developments. 
Certainly, any new targeted brownfield funding that was 
mentioned here this morning would be welcome and appreciated by 
the economic development community.
    No. 2 would be to allow funds from the EPA's Brownfields 
Revolving Loan Fund to pay for environmental insurance. 
Environmental insurance premiums for brownfield sites can reach 
seven figures. Equally challenging, the environmental insurance 
premium must be paid at the time of land acquisition, before 
land sales can generate revenue of an organization. A grant 
from the Revolving Loan Fund could provide critical assistance 
early in the project's life and, once again, offset a premium 
cost not experienced in greenfield development.
    We heard much from the previous panel about the One Clean-
Up Program Memorandum of Understanding and I echo their 
sentiments that, without that agreement, we would not be 
funding or developing LVIP VII. It is that critical to the 
confidence of our private sector developers and users. As the 
developer of a 1,000-acre site who knows that the timetable for 
that development will occur over 10 to 15 years, my concern is 
in 10 years will we still have the same fervor for brownfields 
as we do today? How do we codify and how do we incent our 
regulators to continue to work with us over the next decade in 
development?
    My comments have been based on that of a practitioner, 
someone who is developing the site. I will state that the 
legislation proposed by you, Mr. Chairman, regarding the 
Brownfields Revitalization Act of 2005, would add another 
weapon to our arsenal. We can provide local tax incentives, we 
can provide State funding, we can provide Federal funding. If 
we can also provide Federal tax incentives, that is a missing 
link that at the moment we cannot provide. As you know, we 
cannot provide Federal grants directly to private businesses, 
so that is a hole in our incentive program and another form of 
assistance for those taking the risk--it truly is a risk to 
step on and develop and put one's equity into a brownfield 
site.
    In closing, LVIP VII at the Bethlehem Commerce Center is an 
exciting project that has challenged and galvanized all 
elements of our organization. It is extremely fulfilling to 
work with partners at the local, State and Federal levels on a 
project that will make a difference for generations to come. On 
behalf of the Board of Directors, I would like to thank you for 
the opportunity to speak before you today.
    [The prepared statement of Mr. Wrobel follows:]

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    Mr. Turner. Thank you. Mr. Paul.

                     STATEMENT OF CHAD PAUL

    Mr. Paul. Good morning, Mr. Chairman, Mr. English, Charlie. 
Thank you very much for inviting me to speak about the Ben 
Franklin involvement with the brownfields projects here in 
Bethlehem. The Ben Franklin Technology Partners was another 
great idea coming from a Governor. Governor Thornburgh, in 
1982, along with legislative partners, passed legislation to 
create the Ben Franklin Technology Partners. We work with early 
stage technology entrepreneurs to bring their companies to 
market and we use technology to creatively solve problems for 
established manufacturers in Pennsylvania to keep those family 
sustaining jobs in Pennsylvania. Our particular center is 
located here on the campus of Lehigh University and my office 
is responsible for this activity in the 19 counties that make 
up the northeastern corner of Pennsylvania.
    We bring business expertise and, notably, investment in 
those companies; up to a half a million dollars over 3 years 
can be invested in a particular company that we are working 
with. We bring business, university and government links 
together to solve problems for those clients. What does that 
have to do with brownfields? Ben Franklin Northeast has started 
over 300 companies, created almost 600 new products, created 
almost 10,000 jobs in Pennsylvania, retained in excess of 
17,000 jobs and we have done that through our investment 
processes and through the operation of our National award 
winning business incubator on the mountaintop of Lehigh 
University's campus.
    The problem is that those incubators can only be so big and 
when companies get to a certain point, we need to move them 
out. We need to create post-incubator space and we have done 
that on the south side of Bethlehem. The committee had an 
opportunity to see two of the three buildings that are on the 
Bethlehem Technology Center campus and that was, in fact, a 
collaboration of Ben Franklin and our economic development 
partners, notably organizations represented by two other folks 
on this panel, showing you that local, State and ultimately, 
Federal assistance can do great things with respect to the 
development of technology and redeveloping brownfields all at 
the same time and with the same money.
    We collaborated together in 1993, before the 1995 act, 
obviously, was passed to build the first Bethlehem Technology 
Center on Bethlehem Steel brownfields property without the 
protections that came with the 1995 act. It made it much more 
difficult, as you can imagine, for a nonprofit group to create 
an ``if you build it, they will come'' kind of project. We were 
able to do that with $3.7 million and now that facility is 
occupied 100 percent by one of the original tenants, IQE, with 
an employment of 90 folks. Bethlehem Technology Center II 
followed in 1999, a $3.2 million collaboration of the similar 
partners, primarily for OraSure Technologies, but also for two 
other incubator graduates, CDG Technologies and SCG. All folks 
that started in our incubator with one or two folks and an 
idea.
    Bethlehem Technology Center III is now the headquarters of 
OraSure Technologies and it was built entirely with resources 
provided by OraSure and its management. No public money was 
involved in the development of that facility, at all.
    And finally, we are in the planning stages of Bethlehem 
Technology Center IV, since we are bursting at the seams, both 
at the incubator and in our post-incubator facilities and it is 
in that area that I would say to the committee that to the 
extent that you are providing funding sources, that you can 
strongly consider that an element of funding for redevelopment 
should be in helping local economical development organizations 
to do projects such as our Bethlehem Technology Centers through 
grants that match what it is that we can provide in the way of 
funding to make more opportunities for more of these technology 
companies to grow in our communities and reclaim brownfields at 
the same time. I think you can see that the leverage that is 
being provided by these activities has been outstanding.
    [The prepared statement of Mr. Paul follows:]

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    Mr. Turner. Thank you. Mr. Suhocki.

                    STATEMENT OF RAY SUHOCKI

    Mr. Suhocki. Good morning. Good morning, Mr. Chairman, 
Charlie, Congressman English. Thanks for the opportunity. 
Lehigh Economic Development Corp. is somewhat unique. We are an 
economic development organization representing the two counties 
of Lehigh and Northampton and we are what we call a one-stop 
shop and part of that one-stop shop includes a function called 
the Lehigh Valley Land Recycling Initiative. And we are unique 
in that we are not, we don't do redevelopment of the property, 
we are not a government agency, we are a facilitator between 
the government agencies and the property owners and the 
developers. So it is a somewhat unique situation and I want to 
offer some perspective as it relates to our experience in 
dealing with both sides of the fence.
    First of all, I want to note that the majority of the 
brownfield sites within the Lehigh Valley are located within 
the urban boundaries of our three cities, Allentown, Bethlehem 
and Easton or smaller, generally poorer municipalities and 
therefore, the proposed Federal tax credit legislation should 
provide incentives to support LVEDC's continued effort in the 
redevelopment of brownfield sites in the region.
    A few of the impediments that should be looked at and could 
help us, and I will touch on three of them, the first, the 
community perception of health risks associated with 
environmental impact that remain in place as part of brownfield 
redevelopment projects. Although the use of engineering and 
institutional controls are widely accepted as safe, permanent 
alternatives to removing historical industrial impact, the 
public continues to fear the presence of residual 
contamination. Additional education efforts are needed to help 
the general public understand the use of these strategies and 
their long-term impact on a community. I want to talk about the 
public understanding. That public is not just the John Q. 
Public, it is also folks that are developers, engineering 
firms, accounting firms that are, and bankers who are advisers 
to potential property owners.
    The second issue, multi-layered regulatory programs that 
often require numerous approvals from multiple agencies and 
departments within agencies. This results in increase of 
project costs and time to insure appropriate approval is 
obtained from all parties involved. Recently, in Pennsylvania, 
the Department of Environmental Protection under Secretary 
Kathleen McGinty, announced a new program to facilitate the 
review and approval process on brownfields redevelopment 
project. That program, the Brownfields Action Team [BAT] 
program, created a single point of contact approach to the 
review and approval process across the agency. Permits, plans, 
reports and submittals are required to demonstrate compliance 
under State laws go through one point of contact. That person 
is responsible for facilitating the review and approval process 
that ultimately reduces the cost and time to complete the 
project. This effort should be extended to the Federal agencies 
through the recently approved Memorandum of Agreement between 
Pennsylvania and EPA such that one point of contact can be 
assigned to brownfields projects and involve both State and 
Federal approvals.
    Through the MOAs, a one-stop shop can be established where 
both agencies agree to one lead agency and one point of contact 
that is responsible, again, for facilitating all reviews and 
approvals required to comply with both State and Federal 
environmental laws. Our experience has been that one-stop shop 
through the BAT team is extremely helpful and allows that 
insider to cut through red tape, to understand how to push for 
approvals, etc.
    And last, funding for due diligence and site assessment 
activities needs to be increased. With the reduction in funding 
available from State environmental cleanup programs, in this 
case, the ISRP, the Industrial Site Redevelopment Program, a 
critical gap is developing. Although EPA brownfields assessment 
grants are available for these activities, the time and 
administration associated make these dollars hard to use on 
small and time-sensitive projects. With the introduction of new 
regulations governing All Appropriate Inquiry [AAI], and due 
diligence that is required to protect innocent purchasers, 
greater focus will be on completing due diligence and site 
assessment activities before communities or innocent purchasers 
take title to brownfield properties.
    These investigations typically come when crucial, time-
sensitive decisions need to be made. For example, tax 
foreclosure or property takings by eminent domain. Time to 
develop and obtain approvals for work scopes and bid contractor 
workout may not be available under the EPA funding programs and 
historically, State brownfield programs filled this gap and 
provided the necessary funding on time-critical schedule to 
complete the work. Those are a few examples of our experience 
and recommendations for where some changes might be made. Thank 
you for your time and attention.
    [The prepared statement of Mr. Suhocki follows:]

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    Mr. Turner. Thank you. Mr. Donches.

                  STATEMENT OF STEPHEN DONCHES

    Mr. Donches. Chairman Turner, Mr. Dent, Mr. English, thank 
you for the opportunity to speak today. I would like to talk 
about Bethlehem Steel's approach to brownfields remediation 
during the time I was in charge of the redevelopment of the 
idled former steel plant you visited this morning. The decision 
to close a plant is never an easy one and without exception, it 
presents hardships to both communities and to employees. 
Historically, the loss of jobs and business opportunities and 
tax revenues is always further aggravated by the fact that too 
many sites remain dormant because existing laws and practices 
provided no incentive for the owner to redevelop the property.
    The steel industry, along with other old line industries, 
suffered through downsizing throughout the 1980's and 1990's 
and at which time numerous plants in many States were closed. 
And, depending on the State in which a shut down facility was 
located, a company may or may not have had a good opportunity 
to redevelop or reuse the site. For example, Bethlehem Steel 
closed a plant in Lackawanna, NY in the early 1980's and then 
subsequently closed the local plant in the mid-1990's. The 
Lackawanna plant in New York under then New York law, did not 
provide for brownfield cleanup and liability release and 
consequently, other than demolition, not much else has taken 
place up there. Plans have been put in place, but the laws 
restricted activity.
    Contrast that, if you will, with the Pennsylvania approach. 
When Governor Tom Ridge took office in 1995, he worked with the 
General Assembly to pass the Land Recycling Act, which we have 
heard, Act 2, early that year. The law addressed two key things 
from an employer-owner standpoint: that is the uncertainty 
associated with brownfield cleanup standards and it also 
brought finality as far as liability release is concerned. 
Secretary Seif already commented, but it is safe to say and at 
the time, our chairman, Hank Barnett did say that had 
Pennsylvania not had Act 2 in place at the time, Bethlehem 
Steel would not have been able to take the approach it did on 
the 1800 acres here in Bethlehem. It would have been a totally 
different project and the Beth Works now and the LVIP projects 
that we see today are only possible because of the fact that we 
had Act 2 in place.
    There are several key factors that position the 1,800 acres 
for the opportunity that exist today and one was the leadership 
provided by Secretary Seif of the DEP and which is being 
continued by Secretary McGinty. Another was the enlightened 
management of Bethlehem Steel that was willing to take some 
measured risks and to negotiate some uncharted waters in 
applying the new law to its property. Many of the principles of 
both DEP and Bethlehem Steel were the same both before the new 
law and after the law. The difference was that with the new law 
in place and with inspired leadership, instead of an 
adversarial approach with little or no progress, the parties 
saw an opportunity to convert an inactive operation into a 
potentially prosperous community economic development project 
by jointly addressing the issues.
    Another key factor was that DEP introduced EPA into the 
project at an early date and we have heard about the agreement 
that was signed between the parties. This turned out to be very 
significant because throughout the negotiations, all the 
principle parties, the decisionmakers, Bethlehem and its 
advisors, DEP and EPA, were always at the table. And the 
importance of this approach was that surprises were eliminated 
or at least minimized because new information was passed among 
the parties almost simultaneously upon being received.
    Now, after completing the studies to determine highest and 
best use of the land, the most important question critical to a 
property's future was how the environmental issue was going to 
be managed. By choosing the brownfield remediation approach, 
Bethlehem was able to prepare most of the 1,800 acres for sale 
or reuse, and DEP and EPA at the time called this a National 
model for brownfields redevelopment. Bethlehem had projected 
that when fully developed, investment of private and public 
dollars in the Bethlehem Works and Bethlehem Commerce Center 
project would be about $1.2 billion, would create between 7,500 
and 10,000 jobs and generate some $70 million in annual tax 
revenues.
    These projections still look good today, but now the 
investment looks, now looks like it will approach $2 billion 
and probably exceed the $2 billion. To date, there has been 
significant investment in a power plant by CONECTIV Energy, 
about $600 million, an intermodal facility by Lehigh Valley 
Rail serving Norfolk Southern, three technology centers you 
have heard referred to, a skating rink, LVIP's new industrial 
park and onsite infrastructure of more than $25 million. Site 
preparation and planning by Bethlehem Steel exceeded $40 
million. Congressman Dent was here recently announcing funds 
for a new highway expansion, it will also add about $60 million 
to the project and the National Museum of Industrial History 
has about a $25 million investment in the project it is doing. 
None of this would have happened had we not had the 
Pennsylvania brownfields law in place. Thank you, Mr. Chair.
    [The prepared statement of Mr. Donches follows:]

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    Mr. Turner. Thank you. Mr. Dent.
    Mr. Dent. Kerry, thank you for the tour this morning and 
also, I just was reviewing your comments once again and you 
made some specific suggestions about what we ought to be doing 
particularly with respect to Federal EPA funding. As you are 
probably aware, Ray probably more so, many of the State 
programs, I believe, are directed or there are incentives to 
take State program funding dollars toward brownfield sites. 
They give you greater incentive. I am not sure if there is a 
fixed percentage. Has it been your experience, and this is 
really for Kerry and for Ray, that EDA funding is not as 
targeted toward brownfields sites and do we need to provide 
that kind of a fixed percentage for brownfield sites of that 
funding? I just always thought that most of the funding would 
logically go there because that is where it is most needed.
    Mr. Wrobel. LVIP was a recipient of EDA funding for three 
out of its previous six industrial parks and I think the issue 
there is the legislation and the environmental insurance 
industry catching up that allows for private development on 
brownfield sites, so most recently, I would say yes, it is my 
understanding that there has been an emphasis with EDA funding 
on brownfield sites, but if we can, again, codify and make sure 
a fixed percentage each year is definitely allocated toward 
brownfield----
    Mr. Dent. What would be a reasonable percentage?
    Mr. Wrobel. Working in brownfields? I would say----
    Mr. Dent. Because industrial site reuse at the State level, 
I believe there is a fixed percentage. I don't know what it is 
off the top of my head, but----
    Mr. Suhocki. The ISRP funds are down to about half a 
million dollars a year now.
    Mr. Wrobel. But 100 percent allocated toward brownfields 
sites.
    Mr. Dent. It is 100 percent?
    Mr. Wrobel. Yes.
    Mr. Dent. OK.
    Mr. Wrobel. Yes. So I would say at least, you know, 60 to 
75 percent I would assume.
    Mr. Dent. Of EDA funds----
    Mr. Wrobel. Should be targeted toward brownfield sites.
    Mr. Dent. Great, OK. And then on the, you also mentioned 
the environmental insurance.
    Mr. Wrobel. Correct.
    Mr. Dent. That issue, how would you, would you recommend 
that EDA funds be allowed to go toward that, as well?
    Mr. Wrobel. It is my understanding this is being discussed 
at the staff level and at EDA currently and again, the 
representative from EDA this morning, Abe, spoke about the 
block grants that are being given to communities. At the 
moment, those block grants must be used for remediation, which 
triggers another level of Federal reporting that is not 
required by Pennsylvania's DEP. By funding environmental 
insurance premiums, it is being discussed that Federal funding 
would not be triggered and because it is not actually funding 
remediation, it is funding the insurance premium and an 
organization like us would get the benefit of having the 
streamlined approach that DEP's providing as far as reporting 
and remediation with the added bonus of a grant paying for what 
is a very significant up front cost.
    Mr. Dent. OK, thank you. And just finally, Steve, I wanted 
to say I thank you to you and your colleagues at Bethlehem 
Steel at the time for being enlightened. The tour that we took 
today, I mean, Bethlehem Steel could have taken the approach, 
it could have just locked the gate and they didn't. They did a 
lot of things very thoughtfully and they planned well and I 
think today we are seeing some of the results of that planning 
in conjunction with Acts 2, 3 and 4 at the State level and just 
proud to be able to drive through there today and just see all 
the activity on a dreary, rainy morning, just to see, you know, 
life there, a lot of life and a lot of action there and I just 
want to thank you for your leadership and could you just quick 
give us a summary of where you stand with the museum right now?
    Mr. Donches. Well, we have raised about half the money we 
need, about $12\1/2\ million. We started restoration work on 
the building by replacing the roof recently and we continue to 
raise funds to do the rest of the construction work and exhibit 
work. It is an opportunity to bring the Smithsonian Institution 
with our relationship to a small community, which was a major 
part of the affiliations program that the Smithsonian talked 
about, how to take objects that have been in storage in and 
around Washington warehouses and bring them out to communities 
throughout the country.
    I am proud to say that we were the first affiliate. We 
served as the template for the affiliations program for the 
Smithsonian. There are now about 140 in some 38 or 39 States, 
all different types of purposes, so this is another opportunity 
that the brownfields presented, because you would not have done 
this otherwise.
    And if I might comment, Charlie, that I think the important 
thing in this whole brownfields project was the public/private 
partnerships that we were able to establish early on. And it 
was to know the working process with EPA and DEP literally 
sitting around the table on a regular basis talking about the 
issues, doing the testing and I think the reference that was 
made earlier about the need to communicate to the public what 
brownfields are all about. It can't be overemphasized. It is 
critical because the general consensus right off the bat, for 
example, the steel plant, was that it will be so contaminated 
that it won't have possible future use. In fact, many of the 
sites are managed quite well from an environmental standpoint 
and the remediation under the options under brownfields law can 
be accomplished at reasonable cost and put to good use in the 
future.
    But the detail work that went into the remediation plan is 
very, very significant. The monitoring wells, the soil testing, 
over periods of many quarters to determine what, if any, 
contamination exists and then to file a Notice of Intent to 
remediate with the State, which required approval. I think all 
that information is often just passed over because you say 
brownfields and people say oh, it is a different approach. It 
is different, but it is also very detailed and it does result 
in a cleanup.
    Mr. Dent. Thank you. Thank you, Mr. Chairman.
    Mr. Turner. Thank you. Mr. English.
    Mr. English. Mr. Chairman, if I could, I would be happy to 
yield my time to Mr. Dent.
    Mr. Turner. Good, excellent. Gentlemen, I would assume that 
many communities come to you and look at the things that you 
have accomplished and look to advice as to how they can be more 
successful. When those communities come or when people ask you 
what do you think is essential for them to have success, what 
advice do you give them? Kerry.
    Mr. Wrobel. Well, I think the LVIP model is very 
interesting. It is a stand alone organization, nonprofit, no 
government affiliation, so we keep politics at the door. We say 
we are nonpolitical. Our only focus is economic development, so 
to have an organization, and this is not simply to toot our 
horn, but it is something that other communities will say we 
don't have something like LVIP, which is a group that is 
independent, has the ability to secure Federal and State grants 
and low interest funding.
    It has a specific focus of infrastructure development and 
selling land to end users and then really basically getting out 
of the way and letting the private sector function, so I would 
say LVIP is certainly a model that could be shown and 
demonstrated to develop brownfields successfully to other 
communities. And then will echo what Steve has said. LVIP VII 
is possible by funding from State, county and Federal levels, 
from the city of Bethlehem with timely approvals and tax 
abatement, the school district and the county, as well, with 
tax abatement, so it has to be--it is an overused term now, 
over 15 years I have been hearing this word--the 
``partnership,'' it is overused, but it is so critical. You 
cannot develop a brownfield site without all governments at the 
table with nonprofits making this a top priority for a 
community.
    Mr. Paul. Well, ``partners'' is in our name. Ben Franklin 
Technology Partners is the most respected, most successful and 
most imitated technology-based economic development 
organization in the United States. As a result, we have had 
visits from Governors' offices and various economic development 
groups from a dozen or more States and some foreign countries. 
And to echo Kerry, the partnership is what makes it work 
because we don't have all the resources that we need under our 
umbrella. The fact that we work with the university, with the 
city, with all of the other economic development organizations 
in a partnership to make something happen has been the secret 
to our success. Our companies that we are going to put into 
those brownfields buildings and have put in those brownfields 
buildings have companies that would not exist if these 
partnerships did not work.
    Mr. Turner. I will just build on that, and the partnerships 
are critical and the partnerships are on a regional basis. As I 
mentioned earlier, I represent two counties and across those 
two counties, that network that Chad talked about of education, 
government, etc. really pulls together in setting priorities so 
that when we are talking to government, we are talking from the 
same page. The issues that are important to us are the issues 
that are important for every partner, so there is that kind of 
agreement that doesn't keep us fighting one for the other for 
the few dollars. It lets us focus on the top priorities and 
move on those.
    Mr. Donches. Mr. Chairman, I would say that it is important 
that people looking at sites understand that there are 
voluntary cleanup standards that they want to meet and they 
have the choice as to how they want to meet those standards, so 
it is important to have technical expertise as you approach the 
standards. Of course, the issue that I mentioned of finality 
and liability release, if you don't have that, you are not only 
not going to get developers, you are not going to get anybody 
to finance the projects, either.
    I think communication broadly, to the community, is 
provided for in the brownfields law in Pennsylvania but it is 
important to do that at an early date. For example, we had a 
couple of open hearings, public hearings where we just invited, 
through newspaper advertisements, people to come and hear what 
the project was about and how remediation was going to be 
addressed. I thought that was very useful.
    And I think I would probably say to owners or developers 
not to be afraid to explore the issues and the opportunities. 
You find one, you sit down today with DEP certainly in 
Pennsylvania and EPA. It is a different approach. And you find 
that it is not as bad as it used to be, the old adversarial 
days where we locked horns. I think today openness is there, 
there is transparency and I would say explore the issues; the 
opportunities are great.
    And then, finally, it has been mentioned a number of times, 
infrastructure funding, both onsite and offsite, is critical 
and to get that into play early on. Locally here, we were 
fortunate to have the county, Northampton County, push for a 
bond issue that resulted in some $13 million for a road that 
gets into the area that Kerry is going to be developing, but 
even with early support, that has taken a long time; they are 
finishing it up now. But it won't do any good to have a 
remediation plan and go through the whole process if you can't 
get to the site. And in the case of this one, it is extremely 
large, 1,800 acres.
    It has been called the largest private brownfield 
development. You need not only the onsite infrastructure that 
the county has helped provide, but the highway that surrounds 
the site, State Highway Route 412. That funding has been under 
discussion for every bit of 10 years and we are now finally 
getting to that point where the funding is essentially in 
place. I think construction is out to 1998 for starter, but 
without the infrastructure funding, all the other work, if you 
can't have access to the site, it comes up a little bit short, 
so that is critical.
    Mr. Turner. Thank you. Mr. Dent for final questions.
    Mr. Dent. Just to Chad Paul, actually. I believe before you 
arrived at the Ben Franklin Technology Partners, I guess 
Technology Centers I and II were already up and running, if I 
am not mistaken and I believe one or, I believe maybe both of 
those buildings were built prior to Acts 2, 3 and 4. Is that 
correct?
    Mr. Paul. We had coverage on 2, 3 and 4, I believe, Steve, 
right, for Beth Tech II?
    Mr. Donches. Yes, Beth Tech II. Only the first one was----
    Mr. Paul. But we did not have it for the first one.
    Mr. Dent. I guess the question I have, and maybe it is a 
better, I am not sure if I should address it to Chad or to 
Steve, but how is it that you were able to build Tech Center I 
without that liability protection when you did it?
    Mr. Paul. The board of Lehigh Valley Industrial Parks of 
Northampton County Development Corp. had long talks with folks 
from Bethlehem Steel. They had guarantees, corporate guarantees 
from Bethlehem Steel to ease the pain and Steve was involved 
with all that. Perhaps you may want to address that in more 
detail, but it was the, it was assurances of help from 
Bethlehem Steel if there was more of a problem than what we had 
originally seen on the site that allowed all of us to, and 
again, I am talking about my organization, not me.
    Mr. Dent. So Bethlehem Steel was essentially going to 
assume liability or----
    Mr. Donches. Yes, there were dollar limits if they were 
exceeded, that Bethlehem Steel would step up and there was a 
risk involved, but it was a relatively small site and my memory 
is maybe 4 acres or something of that sort and since we owned 
the site for, Bethlehem Steel owned the site for 100 years, 
pretty good records as to what was there and what it was used 
for, so it was a measured risk which you might take on a small 
site and also, the main thing at the time was that Bethlehem 
was trying to present an opportunity to help revitalize the 
community, so it was part of a good citizenship thing that, 
with the consortium, would help to underwrite part of the 
costs, just to make it, just to give it a start and with LVIP, 
Job Corps II, BETCO, Northampton County, it came together, 
again, it was a partnership that everybody helped to pull a 
little bit on the oars.
    Mr. Paul. I should note as an addendum that finally this 
year we are getting final clearance on that original site.
    Mr. Dent. My point is that I think you can see that 
somebody had to accept responsibility for a potential 
contamination liability; in this case it was Bethlehem Steel.
    Mr. Paul. Correct. Since our partnership of organizations 
owns those buildings through Northampton County New Jobs Corp., 
once Bethlehem Steel was no longer there to back us up, we felt 
it prudent to spend the dollars we needed to spend to get that 
final work done and get that clearance.
    Mr. Suhocki. And we are trying to sell it, so obviously, we 
have to go through those clearances.
    Mr. Dent. Trying to sell Tech Center I? OK.
    Mr. Wrobel. And just finally, I just want to acknowledge 
for the committee here, that there were good local partners in 
this process. It wasn't just the State and the Feds, the MOA, 
but the--as was mentioned--the county governments matched 
significant dollars on that road that we drove on today, 
actually, that four lane highway--Commerce Boulevard. And also 
municipal government and, of course, the economic development 
corporations all played leading roles in the redevelopment of 
this site, so I just wanted to acknowledge that.
    Mr. Turner. Great. As with the first panel, I want to give 
you an opportunity for any closing remarks or if there are 
questions that we haven't asked you that you would like to 
respond to or things that you would like to add, having heard 
the other panel members. I want to give you that opportunity if 
you have any additional comments.
    Mr. Suhocki. I would just like to say that we appreciate 
your interest and involvement here. It is very, very important. 
We have approximately 100 brownfield sites in the Lehigh 
Valley. They are not all as famous and large as, fortunately, 
as the LVIP project, but they are very important and each one 
of those, as I mentioned earlier in my comments, are typically 
within an urban setting and it is great as we look at the 
proposed legislation that you are preparing that the tax credit 
will help those kinds of properties be returned to use and 
useful.
    Mr. Turner. Excellent. Well, before I give you my closing 
comments, I want to thank Mr. Dent for having us here in his 
district and for allowing us to focus on what is obviously a 
successful partnership and has given us some additional issues 
and ideas of what we need to do on the Federal level for 
brownfields. It is great to hear the past successes that you 
have had as a community and certainly, Mr. Dent's participation 
in that is why he is so effective in Congress and as Vice Chair 
of this committee because he brings that level of experience in 
working with you at the community level and his experience in 
the legislature to Congress so we can address National issues. 
And I want to thank Mr. English for being here. He certainly 
raises our profile and his leadership in being here at this 
hearing.
    Mr. English. Mr. Chairman, I would also like to thank you 
and Mr. Dent for being so proactive in sponsoring this hearing 
and in focusing on what I think is one of the better case 
studies in the country for this program and how you tackle 
brownfield problems, so it has been a privilege to be part of 
this process today and I think this will be immensely valuable 
to us when we make decisions in a number of committees in 
Congress.
    Mr. Turner. Excellent. Before we adjourn, Mr. Dent, do you 
have any closing comments for us?
    Mr. Dent. I want to thank everybody for providing testimony 
today and I think what we have seen here today is, again, 
talking about the Bethlehem issue in particular is interesting, 
but most brownfield sites, of course, aren't as big or as 
complex and that, you know, we can take a lot of lessons out of 
here and apply them, frankly, to smaller sites, that hopefully 
will be less complex but nevertheless difficult and that is 
really what I am hoping for, that, you know, here we are 
taking, really, the mother of all brownfields in the United 
States and seeing a lot of success and there are lessons 
learned and hopefully we can take this experience, this model, 
from Pennsylvania and from Bethlehem and apply it around the 
country.
    Mr. Turner. Thank you. I want to thank all of our panel 
members, again, for your preparation today, for what you 
contributed in participating and also what you do for your 
communities. These field hearings are a valuable tool for us as 
we get to learn from your experience and your expertise and be 
able to take those back to Washington to look at Federal 
policies.
    I would also like to express my appreciation to the city of 
Bethlehem and to Lehigh University for hosting us and we owe a 
special thanks to President Farrington and his staff, 
particularly, to Vice President Michalerya, who has stayed here 
with us and for showing your wonderful facilities and for your 
accommodating efforts. And in the event there may be additional 
questions that we don't have time for today, we will leave the 
record open for 2 weeks for submitted questions and answers and 
statements for the record. With that, I thank you all and we 
will be adjourned.
    [Whereupon, the subcommittee was adjourned.]

                                 
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