[Congressional Record Volume 141, Number 128 (Thursday, August 3, 1995)]
[Extensions of Remarks]
[Pages E1622-E1623]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


    IN SUPPORT OF SUPERFUND REFORMS TO PROMOTE THE REDEVELOPMENT OF 
                            ``BROWNFIELDS''

                                 ______


                        HON. RICHARD A. GEPHARDT

                              of missouri

                    in the house of representatives

                        Thursday, August 3, 1995
  Mr. GEPHARDT. Mr. Speaker, I join today with Mr. Brown of Ohio, Mr. 
Dingell, Mr. Stokes, Mr. Borski, Mr. Rush, Mr. Klink, Mr. Manton, Mr. 
Towns, and Ms. Furse in introducing legislation to redevelop abandoned 
or underutilized industrial sites. As many as 500,000 sites that once 
sustained industrial or commercial activities now lie vacant or idle 
across the country in our rural and urban areas. Returning these sites 
to productive use must be an important national goal.
  This legislation is intended to promote the cleanup and redevelopment 
of such abandoned properties, commonly referred to as ``brownfields.'' 
Too often the private sector is deterred from redeveloping such 
brownfields because of their high cleanup costs and the potentially 
open-ended liability associated with undiscovered contamination. 
Likewise, cities have lacked the resources to assess contamination 
levels at abandoned sites or to help finance cleanups.
  Like many cities across the country, St. Louis has hundreds--perhaps 
thousands--of abandoned sites that sit idle and need to be reused. In 
many cases, private owners have simply given up on their properties, 
allowing them to revert to the public domain; the municipality of St. 
Louis owns more than 40,000,000 square feet of abandoned property and 
buildings. But many other underused sites remain in private hands as 
well.
  St. Louis has seen some neighborhoods deteriorate as investment and 
jobs have gone elsewhere. Many times it has been more attractive for 
businesses to invest in untouched property that does not carry with it 
potential environmental liability and expensive cleanup costs. Thus, 
many sites--the old Carondelet Coke plant in south St. Louis City, 
areas along the Mississippi riverfront, and the former National Lead 
site in St. Louis County--remain unused.
  Our goal is to encourage the cleanup and reuse of brownfields for 
productive uses, thus bringing new job opportunities to blighted areas. 
This bill contains provisions to encourage private sector investment in 
redevelopment and provide cities with the resources to coordinate site 
characterization and promote cleanups. There are three major 
objectives.
  First, this legislation provides cities new resources necessary to 
promote the cleanup of sites. Developers or purchasers often find 
capital out of reach when potentially costly environmental liabilities 
are present. In addition, cities often have difficulty in obtaining the 
necessary resources to assess the extent of toxicity of individual 
sites, the first step in brownfield redevelopment.
  To help provide funding that the private sector cannot always 
provide, the bill authorizes the EPA to provide funds from the 
Superfund trust fund for cleanup activities. Local government entities, 
such as the St. Louis community development agency, would be able to 
apply and compete for interest-free loans or grants to perform site 
assessments and cleanup activities. The grants and loans would be 
competitively awarded based on their capacity to create new jobs, as 
well as the amount of local participation and financial support.
  The cities have emphasized that site characterizations and 
assessments are extremely useful in marketing contaminated sites to 
prospective buyers or developers. After determining the level of 
contamination, parties are more inclined to invest in brownfield 
properties since the projected cleanup costs are better known. This 
bill authorizes the EPA to provide 

[[Page E 1623]]
up to $15 million annually from the Superfund to local governments to 
perform such assessments. Furthermore, to facilitate cleanups, the bill 
authorizes the use of up to $30 million annually in loans to finance 
remediation activities.
  Second, this legislation clarifies the lender liability issue in 
order to encourage private sector investment. The Fleet Factors case 
obscured the intent of Superfund's secured-lenders exemption. This 
confusion has made many lenders reluctant to become involved in 
potentially contaminated properties. Bankers now often fear that their 
interest may make them subject to cleanup liability for newly 
discovered or released contamination. The bill makes it clear that 
lenders who are merely performing a lending function and not managing a 
site's daily operations or contributing to the contamination can lend 
for redevelopment purposes without fear of incurring large 
environmental liabilities. The bill also provides protections to 
lenders who act in their capacity as fiduciaries.
  Third, this legislation provides protection for good faith 
prospective purchasers. To protect innocent landowners from Superfund 
liability when they acquire property subsequently found to be 
contaminated, the bill exempts prospective purchasers from such 
liability if certain precautionary measures are taken. Under Superfund, 
the owner of a contaminated tract of land may be held responsible for 
cleaning it up even if the pollution was created by the prior owner. 
Thus, potential purchasers are often deterred from investing in sites 
with potential contamination. This provision allows a purchaser who 
checks the site carefully before purchase to avoid liability if 
contamination is subsequently discovered.
  This legislation is the result of our discussions with many leaders 
on this issue. St. Louis Mayor Freeman Bosley, Jr., cochair of the U.S. 
Conference of Mayors' Brownfields Committee, has been committed to 
finding solutions to problems associated with brown- fields. We have 
also worked closely with St. Louis lenders, environmentalists, and the 
St. Louis Regional Commerce and Growth Association. Finally, I am 
pleased that this bill has the support of the National League of 
Cities. Their contributions helped us focus on the most critical 
problems and develop solutions that are workable in an era of fiscal 
limits.
  This legislation does not solve all aspects of the brownfields 
redevelopment problem. The solutions require a comprehensive reform of 
the Superfund bill, of the sort that nearly passed the House last year. 
There are also other aspects of the problem--such as those involving 
the treatment of leaking underground storage tanks--that must be 
addressed as well.
  Generally, this legislation begins us on the way toward confronting 
the most important factors that have blocked the redevelopment of 
communities throughout urban and rural America. I thank all of my 
colleagues, particularly Mr. Brown and Mr. Dingell, for their hard work 
in developing this bill.


                          ____________________