[Congressional Record Volume 141, Number 128 (Thursday, August 3, 1995)]
[Extensions of Remarks]
[Pages E1621-E1622]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                        CLEANING UP BROWNFIELDS

                                 ______


                          HON. JOHN D. DINGELL

                              of michigan

                    in the house of representatives

                        Thursday, August 3, 1995
  Mr. DINGELL. Mr. Speaker, I rise with my colleagues from Ohio, Mr. 
Brown, and my colleague from Missouri, the distinguished minority 
leader, Mr. Gephardt, to introduce legislation which, if enacted, will 
promote the cleanup of lands containing abandoned or under used 
industrial facilities where legal, environmental, and financial 
barriers prevent redevelopment.
  Contaminated, often vacant industrial sites, known as brownfields, 
pose significant economic and environmental challenges for communities 
throughout southeastern Michigan. These challenges are formidable, but 
not insurmountable. I will explore the issues which determine how to 
succeed in converting our brownfields in Downriver and Detroit back to 
engines of economic progress.
  Industrial properties, contaminated from years of use, are very 
difficult to redevelop. Even ongoing operations may be difficult to 
sustain. Cleanup costs are high and liabilities for past contamination 
scare potential purchasers, developers, and lenders. However, 

[[Page E 1622]]
not cleaning and reusing these sites means that sites with the 
potential to contribute to local economic development and job creation 
sit dormant, and pollution remains unchecked. The lack of usable 
properties in long-term manufacturing centers like those in 
metropolitan Detroit and other cities encourages builders and investors 
to look for more distant locations for development.
  The bill which I am sponsoring with my colleagues will address these 
concerns by providing more than $100 million over 3 years so that local 
governments can choose and develop the sites which have the best chance 
of success if they are cleaned up. The grants will be used to assess 
the environmental conditions and economic potential of a site. Loans 
will allow cities and other development authorities to finish the job. 
Perhaps most important, current Federal laws would be amended to reduce 
fears of liability for purchasers and lenders. Together with the 
enhanced public funding, it is hoped that these steps will leverage 
additional private investment in brownfields.
  I am pleased to say that local governments in my congressional 
district are not waiting for this legislation to get started on these 
efforts. However, organizations like the Southeast Michigan Council of 
Governments [SEMCOG] and the Port of Monroe assure me that this 
legislation should help guarantee success.
  Mr. Speaker, I look forward to working with my colleagues on the 
Commerce Committee to see how this legislation fits with efforts to 
reauthorize the Superfund.
              Brownfield Bill--Section-By-Section Analysis


                          SECTION I. FINDINGS

                    SECTION II. FINANCIAL ASSISTANCE

      Purpose
       Provide financial incentives that encourage redevelopment 
     efforts of brownfield sites.
       Help create a more level playing field relative to the more 
     desirable ``greenfields''.
       Aid with the expenses involved with cleanup activities at 
     brownfield sites.
     Summary
       Provides grants to local governments for site 
     investigations to assess the level of contamination; 
     authorizes $15 million each fiscal year from the Superfund 
     trust fund.
       Provides interest-free loans to local governments for 
     cleanup activities. Such loans are to be repaid within 10 
     years to be deposited back into the Superfund trust. 
     Authorizes $30 million each fiscal year from the Superfund 
     trust fund for such purposes.
       Establishes a 3 year sunset for authorization of funds.
       Permits local governments to submit to EPA an application 
     for a grant or loan for specific redevelopment project(s).
       Specifies criteria by which applications are ranked; 
     includes: Stimulation of economic development (eg. job 
     creation, increased revenue); extent local community 
     participates and supports remediation and development; 
     financial involvement of State and local governments (in lieu 
     of matching requirement); extent the local community supports 
     the redevelopment project(s); and extent health and 
     environmental risks (or threat of) are reduced.


                     SECTION III. LENDER LIABILITY

     Purpose
       Encourage lenders to help finance brownfield redevelopment 
     efforts by reducing liability fears induced by unfavorable 
     court interpretations. The US v. Fleet Corp. court ruling 
     inflicted uncertainty among lending institutions regarding 
     liability.
       Clarify activities that lenders can perform without being 
     held liable under Superfund.
     Summary
       Upholds EPA's 1992 Lender Liability rule which was 
     invalidated by a court ruling:
       Species lender's activities that give rise to potential 
     liability. These include undertaking responsibility for 
     hazardous substance practices and day-to-day decisionmaking 
     with respect to environmental compliance and operational 
     functions.
       Specifies activities that do not give rise to liability. 
     Includes: Mere capacity to influence or unexercised right to 
     control facility operations; actions to require environmental 
     inspection and/or cleanups; work out' activities (eg. 
     preventing foreclosure by restructuring terms).
       To remain exempt from liability after foreclosure, a lender 
     must sell, re-lease, or otherwise divest itself of the 
     property in a reasonably expeditious manner.


                    section iv. purchaser liability

     Purpose
       Protect new purchasers and redevelopers from liabilities 
     for past problems.
       Under N.Y. v. Shore Realty, the court held the current 
     owner responsible for response costs; it reasoned that CERCLA 
     unequivocally imposes strict liability on the current owner 
     of a facility from which there is a release without regard to 
     causation.
     Summary
       Exempts prospective purchasers from liability when acquires 
     ownership of a facility and establishes each of the 
     following:
       All active disposal of hazardous substances at the facility 
     occurred before that person acquired the facility.
       Person made all appropriate inquiry into the previous 
     ownership and uses of the facility and poverty.
       The person provided all legally required notices with 
     respect to the discovery or release of any hazardous 
     substances at the facility.
       The person exercised appropriate care with respect to 
     hazardous substances found by stopping on-going releases and 
     preventing future releases of hazardous substances.


                     section v. fiduciary liability

     Purpose
       Reduce banks' fears of liability in their capacity as a 
     fiduciary. Fiduciaries are wary of accepting real estate into 
     their trust portfolios due to unfavorable court decisions.
     Summary
       Limits the liability of fiduciaries (trustees) to the value 
     of the assets of the trust or estate unless: Person 
     undertakes fiduciary status to avoid preexisting personal 
     liability; fiduciary is personally, causing or contributing 
     to release of hazardous substance; fiduciary participates in 
     planning and implementing a scheme to evade CERCLA; and 
     fiduciary fails to comply with requirements set by EPA.
       Fiduciaries undertaking or directing others to undertake a 
     response/cleanup action under CERCLA are precluded from 
     liability.
     

                          ____________________