[Congressional Record Volume 146, Number 47 (Thursday, April 13, 2000)]
[Senate]
[Page S2752]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ABRAHAM:
  S. 2436. A bill to amend the Internal Revenue Code of 1986 to repeal 
the targeted area limitation on the expense deduction for environmental 
remediation costs and to extend the termination date of such deduction; 
to the Committee on Finance.


                  brownfield cleanup cost recovery act

 Mr. ABRAHAM. Mr. President, I rise today to introduce the 
Brownfield Cleanup Cost Recovery Act. This legislation would repeal the 
targeted area limitation on the expense deduction for environmental 
remediation costs and extend the termination date of such deduction to 
2004.
  Mr. President, the Environmental Protection Agency's brownfields 
program is designed to help communities restore less seriously 
contaminated sites that have the potential for economic development. 
Brownfields are defined as abandoned, idled, or under-used industrial 
and commercial facilities where expansion or redevelopment is 
complicated by real or perceived environmental contamination.
  In general, costs incurred for new buildings or for permanent 
improvements to increase the value of a property must be capitalized--
the cost must be deducted over a period of years. Some expenses, such 
as repairs, are currently deductible--deductible in the year in which 
the cost is incurred. This is also called expensing. It is a 
considerable financial advantage to be able to fully deduct an expense 
in one year rather than over many. The brownfields tax provision would 
include environmental remediation costs as allowable costs for 
expensing. This would create the financial incentive needed to bring 
companies in to remediate brownfields.
  Prior to the passage of the Taxpayer Relief Act of 1997, the tax code 
discouraged the remediation of environmentally damaged property. In 
1996, I introduced legislation to eliminate this bias. This legislation 
ultimately was included as part of the Taxpayer Relief Act of 1997, 
which is now law. However, the incentive expires at the end of this 
year. As part of the Taxpayer Refund and Relief Act of 1999, Congress 
passed provisions expanding upon this important community development 
legislation. This bill contains the same provisions that were included 
in the Taxpayer Refund and Relief Act of 1999, which Congress passed, 
but President Clinton vetoed.
  In addition, Mr. President, current law limits expensing of 
brownfield sites to those sites within ``targeted'' areas--defined as 
being a renewal community under section 198. This bill would eliminate 
the ``targeted area'' limitation, allowing for increased remediation in 
all areas, not just federal designated zones.
  Mr. President, encouraging community renewal has long been a very 
important issue to me. In 1995, my first year as a Senator, I joined 
with Senators Lieberman, Santorum, DeWine and Moseley-Braun, to 
introduce the Enhanced Enterprise Zones Act, to stimulate job creation 
and residential growth in America's most distressed rural and urban 
communities. More recently, Senator Lieberman and I introduced the 
American Community Renewal Act. The ACRA would provide benefits to 100 
distressed communities around the country, including tax benefits 
designed to attract businesses and employers to Renewal Zones. It is my 
hope that this bill will become law this year.
  In my opinion, Mr. President, brownfield remediation is a crucial 
component of any policy for community renewal if that policy is to be 
successful. The provisions provided in this legislation will make such 
remediation more likely and more common. Therefore, I urge my 
colleagues to give it their strong support.
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