A brownfield is a property that is difficult to use or redevelop because of the conditions of its previous development and use. (Contrast with "greenfield", a site that has never been built on before, and so does not typically provide many challenges or surprises.)

The Michigan Department of Environmental Quality provides the following definition:

Brownfields are abandoned, idle, or under-used industrial and commercial properties, often in urban areas, where expansion or redevelopment is hindered or complicated by real or perceived environmental conditions. In Michigan brownfields are considered properties that are either contaminated, blighted, or functionally obsolete.

The term "brownfield" can therefore cover a broad variety of properties, from the very small (an abandoned gas station or oil change business) to the very large (every auto manufacturing plant in the state). Even if the site does not host actual chemical contamination, it requires additional care to work with - the question of whether the site is chemically contaminated must be determined, and the existing structures on the site may be "functionally obsolete", either outright unusable or else requiring substantial reconfiguration to meet current codes and business practices.

Why brownfields?

Brownfields have recently been the focus of much attention in the urban planning, environmental, and development fields for a number of reasons:

  • Brownfield properties can be a danger to surrounding properties and residents, either from health concerns or risk of physical injury from entering abandoned and decrepit buildings.
  • Redeveloping brownfield properties preserves farmland, woodland, and other open spaces that might otherwise be developed.
  • Brownfields are often located inside cities or towns, allowing redevelopment to happen in areas that are already built up, limiting urban sprawl and minimizing the public cost of providing utilities, police and fire coverage, and other services to the site.

Brownfield financing incentives

In order to assist with the increased challenges and costs of working with brownfield sites, along with the liability concerns of taking on a contaminated site, the State of Michigan enacted the Brownfield Redevelopment Financing Act, PA381 of 1996, to provide protections and incentives for developers of these sites. While most states now have brownfield legislation in place, Michigan is nationally recognized as a leader in the field.

Most brownfields are eligible for tax increment financing (TIF) for work such as cleaning up chemical contamination. TIF allows for the developer to be repaid for these costs over a number of years from the new tax revenues created by the project (the "increment") - the local units of government maintain their pre-development revenue levels during this time - as if the developer had loaned the clean-up money to the public.

Some projects are additionally eligible for TIF on the state school taxes (not included in the basic TIF), or for Michigan Business Tax credits. This determination is made by the Michigan Economic Growth Authority. MEGA typically looks for additional regional or state benefit (such as strengthening urban cores with high-quality urban development), beyond the basic local benefit of cleaning up hazardous conditions on the site.

Brownfield development process

The general process of managing a brownfield redevelopment project is as follows:

  1. Developer performs "Phase I" evaluation of property, including review of historical ownership and use, public records relating to the site, and visual inspection of the property, looking for warning signs that the site may have existing environmental concerns.
  2. Developer performs "Phase II" testing of property based on any concerns found during Phase I evaluation. This may include sampling of building material for asbestos, lead, and other contaminants; soil borings; and groundwater testing, depending on the Phase I findings.
  3. Developer files "Baseline Environmental Assessment (BEA)", report results of Phase I and Phase II investigations. An approved BEA essentially absolves the developer of liability for the issues reported, on the grounds that the conditions are pre-existing, and the developer has no responsibility for creating these problems. The developer is still responsible for "due care" activities, to protect site users and the public from any potential harm arising from those conditions.
  4. Developer prepares "Brownfield Plan" stating intended redevelopment and use of property, eligible activities needed to perform that redevelopment, costs of those activities, and proposed financing.
  5. Local governmental unit and Brownfield Redevelopment Authority review and provide approval to Brownfield Plan.
  6. Michigan DEQ reviews and provides approval of Brownfield Plan.
  7. Certain activities are reviewed by MEGA for eligibility for additional financing incentives.
  8. Developer begins work on site.

Brownfield controversies

The financial incentives provided to brownfield projects are frequently criticized as public subsidies of private developments through tax dollars. Supporters respond that the development would not happen without the incentives, and therefore the tax dollars involved would not exist - the public does not lose any revenues during the process, and gains new revenues at the end of the project. (This is less directly the case with the MEGA-awarded MBT credits, which are not directly linked to new revenues created by the project.)

In some cases, controversy is more explicitly linked to criticism of the proposed development as a whole, and not simply the financing of it. In these cases, opponents of brownfield incentives will assert that the project conflicts with public goals, and public financing incentives should not be provided to such projects. Addressing these critiques requires broader discussion and consideration of the planning process and ensuring that the community in engaged in consensus-building around public goals. These discussions should take place at a larger scope, not linked to a specific project, so that the discussion is not driven (or derailed) by an established conflict over the project.

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