Environmental Protection: Agencies Have Made Progress in Implementing the
Federal Brownfield Partnership Initiative (Letter Report, 04/09/99,
GAO/RCED-99-86).

Pursuant to a congressional request, GAO provided information on the
status of 10 federal agencies' efforts to implement the Brownfield
National Partnership Action Agenda, focusing on: (1) comparing federal
agencies' planned financial assistance to brownfields, which are
abandoned, idle, or underused industrial facilities, to their actual
spending for brownfields in fiscal years (FY) 1997 and 1998; (2)
describing the purposes of these obligations; and (3) determining the
extent to which agencies met the Partnership's goals and objectives.

GAO noted that: (1) during FY 1997 and FY 1998, the 10 federal agencies
GAO examined reported that they provided about $413 million in
assistance to brownfields, as compared to the Partnership's planned
financial assistance of $469 million; (2) brownfield managers at the
Department of Housing and Urban Development (HUD) also told GAO that the
agency may have provided more financial assistance for brownfields than
it reported because it provided most of its financial assistance through
its Community Development Block Grant program; (3) about one-half of the
total assistance that agencies provided for grant programs was from new
funds made available for brownfields; (4) the remainder represented
funds that the agencies had traditionally been providing to low-income
and depressed communities under their community and economic development
grant programs, not new or reprogrammed funds for brownfields; (5) HUD,
the Environmental Protection Agency, and the Economic Development
Administration were responsible for $409 million, or 99 percent of the
assistance provided; (6) the three agencies used most of the funds to
make grants and loan guarantees to communities; (7) the 10 federal
agencies in GAO's review reported achieving better coordination and
accomplishing their brownfield action items but do not have
comprehensive data to determine the extent to which this will result in
the expected economic benefits of jobs and private investment in
brownfields; (8) the agencies reported that they increased their ongoing
coordination as a result of the Partnership initiative, most noticeably
through their showcase community projects; (9) the agencies also
completed about 89 percent of their action items in the Partnership
Agenda, such as revising policies that were barriers to brownfield
redevelopment and providing communities more information about available
assistance, predominantly as part of their ongoing programs; and (10)
however, the extent to which the Partnership initiative is meeting the
economic goals--creating new jobs, leveraging additional private
investments in brownfields, and preserving greenfields--cannot be
determined because most agencies are not tracking all of these outcomes
or collecting data specific to brownfields that would allow them to do
so.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-99-86
     TITLE:  Environmental Protection: Agencies Have Made Progress in
	     Implementing the Federal Brownfield Partnership
	     Initiative
      DATE:  04/09/99
   SUBJECT:  Environment evaluation
	     Urban economic development
	     Economically depressed areas
	     Grants to states
	     Hazardous substances
	     Federal aid to localities
	     Federal/state relations
	     Industrial facilities
	     Waste disposal
IDENTIFIER:  Community Development Block Grant
	     Brownfield National Partnership Action Agenda
	     EPA Brownfields Economic Development Initiative

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ENVIRONMENTAL PROTECTION: Agencies Have Made Progress in
Implementing the Federal Brownfield Partnership Initiative
GAO/RCED-99-86 United States General Accounting Office

GAO Report to the Chairman, Committee on Commerce, House of
Representatives

April 1999 ENVIRONMENTAL PROTECTION Agencies Have Made Progress in
Implementing the Federal Brownfield Partnership Initiative

GAO/RCED-99-86

  GAO/RCED-99-86

GAO United States General Accounting Office

Washington, D. C. 20548 Resources, Community, and Economic
Development Division

B-282148 April 9, 1999 The Honorable Thomas Bliley Chairman,
Committee on Commerce House of Representatives

Dear Mr. Chairman: Since the early 1990s, federal, state, and
local governments have focused much attention on the cleanup and
economic redevelopment of brownfields abandoned, idle, or
underused industrial and commercial facilities where real or
perceived environmental contamination is a barrier to
redevelopment. In some cases, rather than face the potentially
high costs to clean up the contamination at brownfields and any
future liability for it, businesses have looked to greenfields
undeveloped sites in rural and suburban areas for expansion and
new development. However, this trend contributes to urban blight,
suburban sprawl, and a reduced tax and employment base in
traditional urban centers. In response to communities' requests
for federal assistance to address brownfields, in May 1997 the
administration announced the Brownfield National Partnership
Action Agenda, a 2- year initiative to bring federal, state, and
local agencies together to clean up and redevelop these sites.

Under the Partnership initiative, more than 20 federal agencies
were to better coordinate their brownfield resources and
activities, specifically carrying out more than 100 action items
involving brownfields that would, among other things, generate
$469 million in federal financial assistance$ 304 million
predominantly in grants to local communities, and $165 million in
loan guarantees. These actions and this investment were to result
in three specific economic outcomes leveraging an additional $5
billion to $28 billion in private investments in brownfields,
creating up to 196,000 new jobs, and protecting up to 34,000 acres
of greenfields. 1

Reflecting congressional interest in brownfields, you asked us to
(1) compare federal agencies' planned financial assistance to
brownfields,

1 The federal agencies included in the initiative were the
departments of Agriculture; Commerce, including its Economic
Development Administration and its National Oceanic and
Atmospheric Administration; Defense, including its U. S. Army
Corps of Engineers; Education; Energy; Health and Human Services,
including its Agency for Toxic Substances and Disease Registry and
its National Institute for Environmental Health Sciences, and
Office of Community Services; Housing and Urban Development; the
Interior; Labor; Transportation; Treasury, including its Office of
the Comptroller of the Currency; and Veterans Affairs and the
Environmental Protection Agency, the General Services
Administration, and the Small Business Administration.

GAO/RCED-99-86 Environmental Protection Page 1

B-282148

as stated in the Partnership Agenda, to their actual spending for
brownfields in fiscal years 1997 and 1998; (2) describe the
purposes of these obligations; and (3) determine the extent to
which agencies met the Partnership's goals and objectives. We
collected financial data and documentation of brownfield
activities and met with the senior managers involved with
brownfields from 10 Partnership agencies that are involved in
these activities: the departments of Agriculture, Defense's U. S.
Army Corps of Engineers, Energy, Health and Human Services,
Housing and Urban Development, and Transportation, the Economic
Development, the National Oceanic and Atmospheric, and the General
Services Administrations, and the Environmental Protection Agency.
Eight of these 10 agencies were responsible for 100 percent of the
planned financial assistance outlined in the Partnership Agenda.
Appendix I includes a more detailed discussion of our scope and
methodology.

Results in Brief During fiscal years 1997 and 1998, the 10 federal
agencies we examined reported that they provided about $413
million in assistance to

brownfields, as compared to the Partnership's planned financial
assistance of $469 million. Brownfield managers at the Department
of Housing and Urban Development (HUD) also told us that the
agency may have provided more financial assistance for brownfields
than it reported to us because it provided most of its financial
assistance through its Community Development Block Grant program.
Under this program, communities have wide discretion on how they
use these funds, and while the agency does track communities' use
of the funds, it does not separately track if the funds were used
for brownfield activities. About one- half of the total assistance
that agencies provided for grant programs was from new funds made
available for brownfields. The remainder represented funds that
the agencies had traditionally been providing to low- income and
depressed communities under their community and economic
development grant programs, not new or reprogrammed funds for
brownfields.

HUD, the Environmental Protection Agency (EPA), and the Economic
Development Administration (EDA) within the Department of Commerce
were responsible for $409 million, or 99 percent of the assistance
provided. The three agencies used most of the funds to make grants
and loan guarantees to communities, which used the funds for
activities such as assessing contamination at sites, cleaning up
sites and planning redevelopment, demolishing old buildings,
constructing new ones, developing and upgrading infrastructure,
and accomplishing real estate transactions for brownfield sites.

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The 10 federal agencies in our review reported achieving better
coordination and accomplishing their brownfield action items but
do not have comprehensive data to determine the extent to which
this will result in the expected economic benefits of jobs and
private investment in brownfields. The agencies reported that they
increased their ongoing coordination as a result of the
Partnership initiative, most noticeably through their showcase
community projects agencies' efforts to provide 16 select
communities with federal funding and technical support for
cleaning up and redeveloping brownfields. The agencies also
completed about 89 percent of their action items in the
Partnership Agenda, such as revising policies that were barriers
to brownfield redevelopment and providing communities more
information about available assistance, predominantly as part of
their ongoing programs. However, the extent to which the
Partnership initiative is meeting the economic goals creating new
jobs, leveraging additional private investments in brownfields,
and preserving greenfields cannot be determined because most
agencies are not tracking all of these outcomes or collecting data
specific to brownfields that would allow them to do so.

Background In 1993, in response to calls from local communities
and professional associations representing them such as the U. S.
Conference of

Mayors to provide more and better coordinated federal support for
brownfields, EPA began providing grants to select communities to
conduct assessments of the potential contamination at brownfield
sites. EPA got involved because lenders' and developers' fear that
contamination would lead to long and costly cleanups was often one
of the first barriers to redeveloping these sites. But communities
wanted more help than EPA could provide with its assessment
grants. Therefore, in July 1996, EPA created the Interagency
Working Group on Brownfields, with staff from more than 20 federal
agencies, and the Interagency Steering Committee, with senior
management representatives from these same agencies. According to
EPA, both groups were created to provide a forum for federal
agencies to exchange information and develop a coordinated
national strategy for brownfields that focused on both
environmental and redevelopment issues.

Subsequently, while developing this strategy, EPA asked the
members of the Working Group to identify specific actions that the
federal agencies would take to support brownfield redevelopment
and the funding they would obligate for these activities for
fiscal years 1997 and 1998. EPA collected this information from
the agencies, which totaled more than 100

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action items and plans to invest about $469 million$ 304 million
predominantly in grants and another $165 million in loan
guarantees. On May 13, 1997, the administration publicly announced
the planned financial assistance and more than 100 action items as
part of its Brownfield National Partnership Action Agenda
initiative, along with the goals of improving agencies'
coordination of their brownfield activities and achieving specific
economic benefits for communities.

One of the major actions under the initiative is the brownfield
Showcase Communities project. In fiscal year 1998, the Working
Group selected 16 pilot communities from eligible applicants. The
agencies intended for these communities to demonstrate to other
communities how they can use federal support to successfully clean
up and redevelop brownfields. According to EPA's Director of
Outreach and Special Projects, the agencies hope to develop models
of how 16 very different types of communities, such as those in
rural, urban, and coastal areas, successfully worked with federal
agencies to redevelop their unique brownfield properties.

Agencies Were Successful in Providing Funds for Brownfield
Activities

The 10 agencies in our review reported that they provided about
$413 million $ 272 million primarily through grants and $141
million in HUD loan guarantees in financial assistance for
brownfield activities in fiscal years 1997 and 1998. EPA, HUD, and
EDA within the Department of Commerce were responsible for $409
million, or 99 percent of this assistance.

Table 1 below outlines the planned federal investment for
brownfields as stated in the Partnership Agenda, and actual
obligations 2 and loan guarantees for fiscal years 1997 and 1998
that agencies reported went for brownfield- related activities.

2 An obligation is a definite commitment on the part of a federal
agency to disburse funds at a later time. Grants are one type of
obligation.

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Table 1: A Comparison of Agencies' Planned Investment in the
Partnership Agenda and Obligations and Loan Guarantees for
Brownfields During Fiscal Years 1997 and 1998

Dollars in millions

Federal agency Planned brownfield

assistance as stated in the Partnership Agenda

Obligations and loan guarantees agencies made for brownfields

EPA $125 $128 HUD 155 26 a EDA 17 114 Other federal agencies b 7 4
Subtotal $304 $272 HUD's loan guarantees c $165 $141

Total $469 $413

a The primary reason for the difference between the planned and
actual financial assistance for HUD is that about $100 million of
the planned assistance for brownfield- related activities was from
HUD's Community Development Block Grant program. Under this
program, communities have wide discretion on how they use their
funds and while the agency does track communities' use of funds,
it does not track if funds were specifically spent on brownfields.
Therefore, HUD could not report an amount of obligations made for
brownfields under its block grant program.

b The other federal agencies are the departments of Commerce's
National Oceanic and Atmospheric Administration; Energy; Health
and Human Services; and Transportation and the General Services
Administration.

c Under HUD's Section 108 loan guarantee program, the agency may
guarantee loans to local governments to conduct large- scale
economic revitalization projects. Local governments must pledge
Community Development Block Grant funds that they have received as
partial security for financing these projects.

Sources: Documentation supporting the Partnership Agenda and
agencies' brownfield managers.

In making this dollar comparison, it is important to understand
the basis of the planned assistance stated for the three primary
agencies in the Partnership Agenda, illustrated in the middle
column of the table above. About one- half of the $304 million
planned assistance was funding that the agencies could actually
commit to obligate on brownfields during the 2- year period. For
example, EPA decided to obligate $125 million because it received
this amount of new appropriations available for brownfields during
this time frame. While HUD's planned financial assistance through
grants as stated in the Partnership Agenda was for $155 million,
agency brownfield managers clarified that the agency could only
commit to spend $25 million because it received this amount of
appropriations for its new Brownfield Economic Development
Initiative (BEDI) program. 3 Most of the remaining $130 million
was an estimate of the amount of fiscal year 1997 grant funds that
communities might choose to use for brownfields

3 Under this program, HUD provided competitive grants specifically
for brownfield development to communities that had already
received community development grant funds from the agency.

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under the agency's Community Development Block Grant program. HUD
could not commit to spend a specific amount of grant funds on
brownfields because under this program, grant recipients have
broad discretion in how they can use the funds. EDA brownfield
managers explained that this was also the case for the $17 million
presented as the agency's planned financial assistance in the
Partnership. EDA could not commit to spend these funds on
brownfields through its economic development grant program because
the agency responds to locally identified economic development
needs, which may or may not include brownfield redevelopment
needs. As a result, EDA cannot estimate the amount of brownfield-
related funding assistance that communities will request or the
agency will award in any given fiscal year.

In comparing these amounts in the Partnership Agenda to the
amounts of actual brownfield obligations and loan guarantees the
agencies achieved, as illustrated in the right- hand column of the
table, we determined that agencies may have obligated more than
they reported but not all of these obligations were a result of
the Partnership initiative. HUD can document the amount of BEDI
funds obligated for brownfields, since this program is dedicated
to such activity. However, HUD does not separately track the
amount of its Community Development Block Grant funds spent at
brownfield sites. Consequently, we could not determine the exact
amount of federal funds the Partnership agencies were using on
brownfields.

More specifically, for the Partnership Agenda, HUD estimated that
grant recipients might use up to $100 million during fiscal year
1997 in Community Development Block Grant funds on brownfield-
related activities. On the basis of some survey and anecdotal
information from grant recipients, HUD brownfield managers
estimated that recipients probably spent more than $100 million on
brownfields through this program during that year. But the
Department cannot demonstrate the extent to which communities used
grant funds for brownfields because communities have wide
discretion in using the funds and the Department does not track
them by this category. EPA and EDA can track their brownfield
obligations EPA because it received its appropriations for
brownfields separately and EDA because recipients identify whether
they are using grant funds for brownfield- related activities in
either their application or their status report on the use of the
funds.

While EDA can track that it awarded $114 million in grant funds
during the 2 fiscal years to communities that used the funds for
brownfield- related activities, compared to the $17 million in
planned assistance for the agency

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in the Partnership Agenda, EDA does not attribute its actual
brownfield obligations directly to the Partnership initiative.
Rather, according to EDA managers, since the beginning of the
program in 1965, the agency had been awarding grants for the
revitalization and reuse of idle and abandoned industrial
facilities, now called brownfields, as a core component of its
mission to aid the nation's most economically distressed
communities. For example, historically EDA had funded projects to
bring about the reuse of closed military facilities; now the
agency is counting these activities as brownfield projects.

HUD anticipates an increase in the amount of funds going to
brownfields in the future. Some communities were not certain if
funds under HUD's Community Development Block Grant program could
be used to address environmental contamination at certain
brownfield properties. HUD's fiscal year 1998 appropriations
provided that states and communities may use Community Development
Block Grant funds for the cleanup and redevelopment of
brownfields, and the agency's fiscal year 1999 appropriations
extended this change to all future fiscal years. According to HUD
officials, the agency will update its block grant regulations to
add that addressing environmental contamination is an allowable
activity under the program.

HUD is also considering modifying one of the three primary
national objectives under its Community Development Block Grant
program preventing or eliminating slums or blight 4 to clarify
that since environmental contamination and economic disincentives
contribute to blight, block grant funds can be used to address
these concerns. HUD expects that this change will encourage the
use of block grant funds for brownfields. EDA has added brownfield
redevelopment as a category for which communities can receive
priority consideration for grant funds. Under EDA's program, once
an applicant meets the agency's basic grant criteria, 5 if the
applicant plans to use the funds on brownfields, the agency can
give the applicant priority for a grant award.

4 Funded activities under the Community Development Block Grant
program must give maximum feasible priority to at least one of
three national objectives: (1) benefiting low- and moderate-
income people, (2) helping to prevent or eliminate slums or
blight, and (3) meeting other urgent community development needs.

5 According to agency officials, EDA uses three basic criteria to
determine project eligibility: (1) high unemployment, (2) low per
capita income, and (3) special need.

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Federal Agencies' Funds Were Used for a Variety of Brownfield
Activities

EPA, HUD, and EDA distributed their funds primarily through grants
and loan guarantees to communities that used them for activities
ranging from assessing a site to conducting some cleanup and on-
site construction. In March 1998, we reported on EPA's use of
brownfield funding. 6 We reported that the agency obligated the
majority of its fiscal year 1997 and 1998 funds for brownfields
through (1) grants to state, local, and tribal governments to
assess the nature and extent of contamination at these properties
in order to promote their cleanup and redevelopment; (2) seed
money to these governments to establish revolving loan funds that
help to pay for actual cleanup activities; (3) grants to states to
develop voluntary programs that provide incentives for developers
to clean up and redevelop brownfields; and (4) grants and funding
support for pertinent research, outreach to community groups, job
training for performing hazardous waste cleanups, and other
related activities.

Over those same 2 fiscal years, HUD provided funds primarily
through (1) the Brownfield Economic Development Initiative (BEDI)
grant program, (2) its Section 108 loan guarantee program, (3) the
Community Development Block Grant program, and (4) its programs to
abate the risks of lead- based paint. HUD awarded its BEDI grants
specifically to communities to use the grants for activities such
as site cleanup or purchasing a brownfield property and selling it
to a private party at a discount price in exchange for the
property's redevelopment. HUD must make economic development
grants, including the BEDI grants, in conjunction with loan
guarantees for, among other things, the acquisition and
rehabilitation of properties. Communities have used their Section
108 loan guarantees to pursue larger- scale redevelopment
activities, including public facilities and physical development
projects, such as acquiring a failed shopping center for
rehabilitation. As for its Community Development Block Grant
program, HUD conducted a recent survey of a small number of its
grant recipients, 80 out of about 1,000 recipients, who
voluntarily provided information on the use of their grants. On
the basis of these data, HUD managers stated that a majority of
these recipients are spending some portion of their funds on
brownfield- related activities, such as cleaning up contaminated
soil and groundwater and removing asbestos and lead from sites.
During fiscal year 1998, HUD also awarded one community in Boston
a grant under its lead- based paint program, which the community
used to clean up lead- contaminated soil at approximately 56
parcels of brownfields that were then converted into housing
units.

6 Superfund: EPA's Use of Funds for Brownfield Revitalization
(GAO/RCED-98-87, Mar. 19, 1998).

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In these same fiscal years, EDA provided funds for brownfield
redevelopment through several of its grant programs. Communities
used these funds for a variety of brownfield- related activities,
including redevelopment planning; the development of inventories
of abandoned, idle, and underutilized properties using geographic
information systems; economic assessments of brownfield parcels;
building renovation and repair, historical rehabilitation,
demolition, and new construction; support for revolving loan funds
for cleanup activities; and brownfield research studies. For
example, one recipient used an EDA grant at a brownfield site to
rehabilitate half of a large building in a former industrial
complex. The environmental contamination had already been cleaned
up prior to the recipients receiving the grant. Another recipient
is using its grant to construct a Bioscience Park Center at a
former Defense medical facility site that EDA classifies as a
brownfield. EDA grant recipients have reported that their
communities are only using up to about 10 percent of their funds
on actual cleanup.

Federal Agencies Are Better Coordinating and Achieving Their
Action Items

In May 1997, the administration announced that through its
Brownfield National Partnership Action Agenda, it intended to
bring together the resources of more than 20 federal agencies to
better coordinate federal support so as to empower communities to
redevelop their brownfields. The administration reported that the
agencies would provide a total of $469 million in financial
assistance by implementing more than 100 brownfield action items
and that this assistance was expected to result in the (1)
leveraging of additional private investments in brownfields, (2)
creation of new jobs, and (3) protection of greenfields.

The 10 federal agencies in our review have improved both their
internal and external coordination of brownfield activities and
have accomplished most of their respective Partnership actions,
thereby increasing the federal government's role in brownfield
redevelopment. However, the administration cannot tell if the
initiative is meeting the economic goals because most agencies are
not tracking these results or collecting data specific to
brownfields that would allow them to do so.

Agencies and Communities Agree That Federal Coordination Has
Improved

Officials of most of the 10 federal agencies in our review stated
that they are better coordinating their actions to address
brownfields, both within their own agency as well as between
agencies. Individual communities and the professional associations
that represent them also agreed that federal coordination had
improved, although they noted that they still face the

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administrative burden of managing multiple federal grants and that
some states and counties were not included in these efforts at
improved coordination.

More than half of these agencies reported that, to participate in
the Partnership, they established informal internal working groups
to better identify what programs and funding within their own
agencies could be used to address brownfields. Moreover, agencies'
involvement in the Partnership, such as helping to select the
showcase communities, has increased their awareness of other
agencies' resources available for brownfields. Consequently,
agencies can better direct communities to the right sources,
depending on the type of assistance the communities need. Some
agencies have also signed a memorandum of understanding in which
they established joint policies and procedures for conducting
brownfield projects. For example, EPA and the National Oceanic and
Atmospheric Administration signed such a memorandum, agreeing to,
among other things, provide to coastal communities information on
brownfields and training on conducting assessment, cleanup, and
redevelopment activities. These efforts, according to the agency
brownfield managers, have resulted in a more efficient federal
approach to brownfields.

In another example, the General Services Administration (GSA)
helped Denver to redevelop a major brownfield property that,
according to the agency's brownfield managers, otherwise probably
would have sat in the agency's inventory. The city wanted to turn
the federal property, located in a depressed area, into an
industrial park that would provide jobs and commerce. The city had
already attracted grants from five different federal agencies for
the project but could not get the money unless GSA transferred the
property. Once GSA became aware of the other agencies' support
through its involvement in the Partnership and community efforts,
the agency was able to expeditiously transfer the property.
Similarly, HUD brownfield managers reported that their
coordination with other agencies has made them more sensitive to
the agencies' requirements. For example, these managers explained
that HUD invited two EPA staff to participate on its panel to
select BEDI grant recipients, and the staff provided valuable
insights about how the grant recipients might manage contamination
issues at their sites. In another instance, brownfield managers
for the U. S. Corps of Engineers claimed that agencies were saving
a significant amount of money by better coordinating and not
duplicating the support they could bring to the showcase
communities. Furthermore, several agencies have revised or expect
to revise a number of federal regulations as a result of the
Partnership. One of the more recent and significant actions that

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could promote more redevelopment, according to the EPA's
brownfield director, was a change in the lending guidelines for
Federal Home Loan Banks that encourages lending institutions to
provide financial assistance to certain brownfield projects.

Perhaps the most evident example of coordination is the Showcase
Communities project. According to the city development managers
from two of the longest- running showcase communities, in Salt
Lake City, Utah, and Dallas, Texas, they are now better aware of
the federal resources available to support brownfield
redevelopment and how to access them and are getting more
technical and financial help from agencies. They also highlighted
that federal agencies are now more willing to participate in joint
efforts, such as forums and periodic teleconferences, to help the
communities overcome any hurdles. The managers acknowledge that a
major reason for this success is that EPA loaned a staff person to
each city, under the Intergovernmental Personnel Act, for 2 years.
For each city, the managers report, this staff person has been
invaluable in identifying available federal resources, such as
grant programs; helping the city to apply to each relevant agency
for these funds; and providing technical assistance, such as
information on the extent of cleanup required at brownfield sites.
Staff who are managing brownfield issues for four professional
associations representing cities, states, and other community
stakeholders indicated that coordination among federal agencies
had improved, especially in the 16 showcase communities. 7

While federal coordination has increased, local community
officials stated that little has been done to reduce the
burdensome administrative processes involved in obtaining federal
financial assistance. In fact, according to the city manager in
Salt Lake City, the rules and regulations governing one HUD
program were so onerous and time- consuming that the city chose
not to pursue the funding. The HUD brownfield managers
acknowledged that federal requirements to ensure grant and loan
guarantee recipients are financially accountable for federal funds
can be burdensome. The local managers further pointed out that
cities not participating in the showcase pilots may not be able to
afford to provide the type of staff resource that they had
obtained from EPA to assist them in applying for and managing
grants from the various agencies. Two of the associations
representing state cleanup agencies and county governments also
noted that some states and counties are concerned that the federal
agencies are bypassing them by meeting with and providing funding

7 These professional associations are the Association of State and
Territorial Solid Waste Managers, the National Association of
Counties, the National Association of Local Government
Environmental Professionals, and the U. S. Conference of Mayors.

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directly to municipalities. The EPA brownfield manager explained
that the agency had met with state and local government officials
when developing the Partnership Agenda and that better
coordination with states was beginning to happen at the regional
level in some areas. While the manager noted that EPA has been
awarding some of its brownfield assessment grants to counties, the
Partnership was late in inviting counties to participate.

Federal Agencies Have Completed Most of the Partnership's Action
Items

Officials of the 10 federal agencies in our review stated that
their agencies had accomplished 63 of their 71 nonfinancial action
items in the agenda, or about 89 percent. 8 In our meetings with
them, the officials reported that they conducted most of these
activities within their ongoing programs and had not established a
formal system to separately track their progress in accomplishing
the action items in the Partnership Agenda. In general, the action
items included implementing changes to existing policies that had
presented barriers to brownfield redevelopment, providing
technical support to communities, providing information to
agencies and communities on federal avenues to support brownfield
redevelopment, and conducting brownfield research. For example,
HUD issued a joint study with EPA on the redevelopment of
brownfields, specifically spotlighting the effects of
environmental hazards and regulation on urban redevelopment. The
Department of Transportation (DOT) issued a new policy repealing
its past policy of avoiding all contaminated properties when
undertaking new transportation projects. The new policy encourages
state departments of transportation, local planning organizations,
and local communities to address their brownfield redevelopment in
their transportation plans and projects.

Agencies had not yet achieved eight of the action items. Officials
reported that agencies did not complete two items and did not
realize they had made the commitments for two other items. For
example, the Partnership Agenda stated that HUD would fund a job
training demonstration project in a low- income community, but
brownfield managers stated that they did not meet the commitment
because they were unaware that it had been made. Agencies dropped
the remaining four action items because they were not feasible or
the agencies lacked adequate funding. For example, Agriculture did
not complete its studies of the economic impacts of revitalizing
brownfields because it did not receive funding for this activity.
Also, EPA did not issue guidance to its regions on the process to
enter into

8 The Partnership Agenda included 99 nonfinancial action items for
more than 20 federal agencies, in addition to the planned
financial investment discussed earlier in this report. The 10
agencies in our review were responsible for 71 of these items.

GAO/RCED-99-86 Environmental Protection Page 12

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memorandums of agreement with states regarding their voluntary
cleanup programs because of negative comments regarding the
guidance from key stakeholders, including the states.

EPA recently hired a contractor to take an accounting of the more
than 100 action items in the Partnership Agenda for all 20
agencies involved. EPA is asking the agencies to report which
action items they achieved, which they did not achieve, why they
did not achieve them, how the actions enhanced support for
redeveloping brownfields, and what specific examples of this they
could provide. EPA expects a final report this summer.

Most Agencies Cannot Demonstrate Whether Expected Economic
Outcomes Will Be Achieved

The Partnership's expected economic outcomes of new jobs, more
private investment, and protected greenfields were estimates of
potential long- term benefits, generated from economic models,
that might result from the federal support for redeveloping
brownfields. They were not goals that the agencies could measure
and achieve within the 2- year period of the Partnership
initiative. For example, HUD brownfield managers noted that it
would take 3 to 5 years after construction is complete at a site
before all anticipated jobs are created. Similarly, EDA brownfield
managers stated that it may take up to 10 years beyond the
completion of a project funded under its grant programs for a
community to realize the full economic benefits from the project.
While EPA brownfield managers stated that the strategy of the
Partnership Agenda was to achieve these long- term outcomes
through the action items, there was no documented strategy that
showed how all of these individual action items, such as
distributing information or providing technical support, were
linked in a way that would result in these economic benefits.

Also, most federal agencies generally do not have the
comprehensive data necessary to determine the extent to which the
economic benefits will be achieved, according to the EPA managers.
For example, communities applying to EPA for grants to assess the
contamination at a site may include an estimate of the number of
jobs they expect to generate if they subsequently clean up and
redevelop it or the amount of private sector funds they will
leverage, and EPA has been compiling these voluntary estimates;
however, EPA does not require recipients to submit such data and
cannot verify the accuracy of these estimates. HUD will be able to
track the number of jobs created at those brownfield sites
addressed through its BEDI grants. HUD also tracks the number of
jobs created under its Community Development Block Grant program.
Recipients provide these

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data in their annual reports to HUD on their use of the grant
funds. HUD can determine which of these jobs were created in
communities with low and moderate income but cannot determine
which of these jobs were specifically created at brownfields or as
a result of the Partnership initiative. EDA grant recipients,
beginning with fiscal year 1997 grants, are required to report on
the number of permanent jobs created or retained and the private
sector dollars invested as a result of brownfield projects that
EDA funded. The EPA brownfield managers said that they planned to
ask agencies to provide whatever data they have available on the
economic benefits achieved through their grant programs and
compile this information as an indicator of the success of the
Partnership initiative.

Agency Comments We provided copies of a draft of this report to
EPA, HUD, and EDA for review and comment, since they are the
primary agencies involved in federal

brownfield efforts. We also provided portions of the draft that
pertained to the remaining Partnership agencies in our review to
them for their comment. The agencies generally agreed that the
report accurately describes their brownfield activities.
Representatives from EPA, including the Director of the Outreach
and Special Projects Staff, the organizational unit that manages
all of EPA's brownfield activities, clarified the goals of the
Partnership Agenda and the extent to which agencies can track
economic benefits, specific to brownfields, that were generated as
a result of the Partnership. We revised the report to more clearly
lay out the goals of the Partnership and clarified that the three
agencies' ability to track jobs and other economic benefits
generated specifically from their brownfield funding varies. HUD
brownfield managers, including the Director of the Community
Development Block Grant program, the primary program HUD uses to
fund brownfield- related activities, pointed out that the agency
was not expected to be able to report an exact amount of block
grant funds obligated specifically for brownfields because this
program does not have such a separate tracking category for this
purpose; we revised the report to include this point. In addition,
the agency clarified the extent to which it tracks the number of
jobs created as a result of its grant programs. We revised the
report to explain that HUD can track jobs created at brownfield
redevelopment sites under its BEDI grant program but not under its
block grant program. Finally, EDA brownfield managers, including
the Assistant Secretary for Economic Development, provided a more
detailed description of the types of brownfield- related
activities the agency funds and reported that communities may not
fully realize the economic benefits from funded activities for up
to 10 years after construction of a project is complete. We
included this expanded description of brownfield activities

GAO/RCED-99-86 Environmental Protection Page 14

B-282148

in the report and also revised the report to clarify that economic
benefits from EDA grants would accrue over the long term.

As arranged with your office, unless you publicly announce its
contents earlier, we plan no further distribution of this report
until 14 days from the date of this letter. At that time, we will
send copies of this report to Senator Max Baucus, Senator
Christopher S. Bond, Senator John H. Chafee, Senator Frank R.
Lautenberg, Senator Barbara A. Mikulski, Senator Robert C. Smith,
Representative Sherwood Boehlert, Representative Robert Borski,
Representative John D. Dingell, Representative Alan B. Mollohan,
Representative James L. Oberstar, Representative Michael G. Oxley,
Representative Bud Shuster, Representative Edolphus Towns, and
Representative James T. Walsh in their capacities as Chair or
Ranking Minority Member of Senate and House Committees and
Subcommittees. We will also send copies of this report to the
Honorable William H. Daley, Secretary of Commerce; the Honorable
Carole Browner, Administrator of EPA; the Honorable Andrew Cuomo,
Secretary of HUD; and the Honorable Jacob Lew, Director of the
Office of Management and Budget. Copies will also be made
available to others on request. If you would like additional
information on this report, please call me at (202) 512- 6111.

Sincerely yours, Peter F. Guerrero Director, Environmental

Protection Issues

GAO/RCED-99-86 Environmental Protection Page 15

Contents Letter 1 Appendix I Scope and Methodology

18 Appendix II Major Contributors to This Report

20 Table Table 1: A Comparison of Agencies' Planned Investment in
the

Partnership Agenda and Obligations and Loan Guarantees for
Brownfields During Fiscal Years 1997 and 1998

5

Abbreviations

DOT Department of Transporation EDA Economic Development
Administration EPA Environmental Protection Agency GSA General
Services Admnistration HUD Housing and Urban Development

GAO/RCED-99-86 Environmental Protection Page 16

GAO/RCED-99-86 Environmental Protection Page 17

Appendix I Scope and Methodology

To respond to our first and second objectives to compare federal
agencies' planned financial investment for brownfields, as stated
in the Partnership Agenda, to their actual obligations for
brownfields in fiscal years 1997 and 1998, and to describe the
purposes of these obligations we used a structured data collection
instrument to request and then review the fiscal year 1997 and
1998 brownfield- related obligations and activities of the
following agencies: (1) the departments of Energy, Health and
Human Services, Housing and Urban Development, and Transportation,
(2) the Economic Development, the National Oceanic and
Atmospheric, and the General Services administrations, and (3) the
Environmental Protection Agency. The stated financial commitments
pledged by the administration to the Partnership for these eight
agencies made up the total $300 million federal investment as well
as $165 million in loan guarantees. We also reviewed the fiscal
years 1997 and 1998 obligations for the Department of Agriculture
and the U. S. Army Corps of Engineers. While these two agencies
did not have an amount of planned financial investment included in
the Partnership Agenda, they did have a number of nonfinancial
action items to accomplish. We determined that in implementing
these actions, both agencies could have obligated funds for
brownfields, so we included them in our review. We interviewed
those managers responsible for brownfield- related activities in
these 10 agencies to confirm that they agreed with the proposed
financial assistance as stated in the Partnership Agenda for them.
We discussed the extent to which the agencies achieved the planned
spending, and we obtained corroborating documentation where
available. We also discussed with them the primary reasons why
they were not able to obligate funds equal to the planned amounts
in the agenda.

To respond to our third objective to determine the extent to which
agencies met the Partnership's goals and objectives we used a
structured survey to obtain the brownfield managers' perspectives
on these issues. We confirmed with the managers their agency's
interpretation of the Partnership's goals and objectives as stated
in the May 1997 announcement and determined the extent to which
the agencies adopted these or other goals. We next asked them to
demonstrate the extent to which they met these goals and to
provide documentation where possible. Furthermore, we discussed
the primary reasons for any unmet goals. We also selected 2 of the
16 brownfield showcase communities to review, ones in Salt Lake
City, Utah, and Dallas, Texas. We chose these two because they
were among the first communities selected for this pilot and
therefore had the longest experience with it. We used a structured
survey to obtain community officials' views on the benefits and
limitations of the

GAO/RCED-99-86 Environmental Protection Page 18

Appendix I Scope and Methodology

federal agencies' approach to providing them brownfield assistance
under the pilot and on any ways in which the federal government
could improve this support.

Finally, we also met with representatives of several professional
associations that have responsibility for brownfield issues. We
selected the following associations because they represent
community interests and have been most active in the area of
brownfields: the U. S. Conference of Mayors, the National
Association of Counties, the Association of State and Territorial
Solid Waste Management Officials, and the National Association of
Local Government Environmental Professionals. We discussed with
them their understanding of the Partnership initiative and overall
federal involvement in brownfields, the benefits and limitations
they observed from this involvement, and ways in which the federal
government could improve its support for redeveloping brownfields.
We also obtained and reviewed the results of any studies they had
done on the issue of brownfields. We conducted our work from June
1998 through March 1999 in accordance with generally accepted
government auditing standards.

GAO/RCED-99-86 Environmental Protection Page 19

Appendix II Major Contributors to This Report

Eileen Larence, Assistant Director DeAndrea Michelle Leach,
Evaluator- in- Charge John Johnson, Senior Evaluator

(160452) GAO/RCED-99-86 Environmental Protection Page 20

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