[Congressional Record Volume 148, Number 150 (Tuesday, November 19, 2002)]
[Senate]
[Pages S11556-S11557]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                       BROWNFIELDS REVITALIZATION

  Mr. BAUCUS. Mr. President, I rise today to highlight an issue of 
great importance to the people of my State and to people across this 
country.
  Over the past several years, I worked closely with a number of my 
Senate colleagues to pass the Brownfields Revitalization and 
Environmental Restoration Act. Signed into law by the President last 
year, this act is an innovative piece of legislation that will promote 
and accelerate the cleanup of hundreds of brownfield sites around the 
country.
  The Brownfields Revitalization and Environmental Restoration Act 
passed with strong bipartisan support in both the House and the Senate. 
It will help states and local communities clean up the country's 
estimated 1,000,000 brownfield sites. These sites blight our 
communities, threaten public health and safety, and drain local tax 
bases.
  I am proud of this legislation. It devotes desperately needed 
resources to address the environmental and economic challenges posed by 
brownfields.
  Still, I remain convinced that there is much left to do. With an 
estimated 1,000,000 brownfield sites across this nation and new sites 
being discovered each day, the very best efforts of our government will 
be insufficient to tackle this growing concern in any reasonable period 
of time.
  For that reason, I have begun exploring legislative options to 
encourage additional private capital investment in the remediation and 
redevelopment of our nation's brownfield sites. Such a solution would 
complement the Brownfields Revitalization and Environmental Restoration 
Act and could help us make great strides toward creating jobs and 
cleaning up the environment in communities across the country.
  Over 60 percent of the institutional capital in the United States is 
held for investment by tax-exempt entities such as pension funds and 
university endowments. Given the risks associated with acquiring and 
cleaning up contaminated sites, it is no surprise that private 
investors are reluctant to invest large amounts of capital in 
brownfields cleanup and revitalization. Tax exempt entities are often 
prevented from engaging in brownfield cleanups because of the unrelated 
business taxable income, UBTI, provisions in the code.
  The UBTI provisions of the tax code play an important role in 
ensuring that entities do not use their tax-exempt status to gain a 
competitive advantage in the marketplace over taxed entities. It is 
clear, however, that the free market is not moving to remediate and 
redevelop many of these sites, certainly not at a rate that will solve 
this problem during our lifetimes. It is my belief that without some 
additional stimulus, many of these sites will remain unattractive as 
business investments and will continue to languish and blight our 
communities.
  If we were to allow tax-exempt entities to invest in the remediation 
and redevelopment of these sites without incurring UBTI, we may be able 
to create a powerful engine to help revitalize our Nation's brownfield 
sites. It also seems possible that we could accomplish these goals in 
this slowed economic climate with a solution that neither materially 
impacts revenues nor

[[Page S11557]]

requires significant costs for administration.
  In the coming months, it is my intent to explore legislative options 
to encourage the investment of additional private capital into the 
cleanup and redevelopment of our Nation's brownfield sites. It is my 
intention and desire to work on this matter in a bipartisan fashion 
with my good friend and colleague, the senior Senator from Iowa.
  Mr. GRASSLEY. Mr. President, let me thank the good Senator from 
Montana and take a moment to echo his remarks. I strongly supported the 
Brownfield Revitalization Act and applaud the strides that it is making 
toward remediating brownfield sites across our Nation.
  In Iowa, as in many other States, we are challenged with our share of 
brownfields in places like Des Moines, Cedar Rapids and Sioux City. The 
cleanup and redevelopment of brownfield sites can help reduce health 
risks, protect the environment, revitalize surrounding communities, 
preserve open space and create jobs by reintroducing properties into 
the stream of commerce that have languished for years.
  Philosophically, I support efforts to encourage private markets to 
help solve problems such as those presented by our Nation's brownfield 
sites. Given the size and scope of the brownfield problem in this 
country, I believe it behooves us to look for additional, innovative 
and low-cost solutions to help encourage investment in the remediation 
and redevelopment of these sites.
  I understand that current law may discourage tax-exempt investors 
from contributing capital to the remediation and revitalization of 
brownfield sites. Let me say to my good friend and colleague from 
Montana that I will gladly work with him to explore legislative options 
to help bring additional private capital to bear on solving our 
Nation's brownfield problem.
  Mr. BAUCUS. Mr. President, I thank my good friend from Iowa. As we 
have worked together as chairmen and as ranking members of the Senate 
Finance Committee, I have always found him to approach issues in a fair 
and even-handed manner. Let me express my sincere appreciation to him 
for the many bipartisan efforts that we have worked on together, 
particularly the Brownfields Revitalization and Environmental 
Restoration Act that passed 99-0 in the Senate. I look forward to 
working with him on this and many other issues in the months and years 
to come.

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