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| BROWNFIELDS: A TAX increase (INcentive) EVERYBODY WANTS |
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The current economic environment has been anything but friendly to municipalities. Federal contributions are declining, employment and sales tax revenues are on a downturn and local governments are feeling the strain on their balance sheets. Many are seeking tax incentives, and other ways, to ease the times.
While often overlooked, brownfield redevelopment provides a unique opportunity to meet both the social and economic needs of municipalities.
Blighted properties are a liability to both the community and the environment. Redeveloping them into multifamily, retail or commercial properties provides a number of positive outcomes.
Brownfield redevelopment is a form of gentrification and provides similar benefits, if not more. Removing an unattractive and potentially dangerous property gives the community a useful piece of real estate that enhances both the quality of life and the viability of the neighborhood.
From an economic perspective it boosts municipal revenue through both property taxes and wage taxes on any new jobs that might be created by the property. This is one way to increase taxes that all parties would approve of.
Here are some real-world examples of how communities are turning contamination into revenue:
- In Jersey City, NJ, EnviroFinance Group provided financing for the remediation of asbestos on a 2.7 acre site, which will serve as the future home of a 540,000 square-foot Conrad Hilton luxury hotel and condo high rise with sweeping views of the Manhattan Skyline.
- In Honolulu Hawaii EnviroFinance Group provided financing for the remediation of benzene on a 4 acre site to be developed into a retail complex
- In the Los Angeles area, EnviroFinance provided financing for the remediation of a pesticide laden 10-acre farm for future development of new community featuring 125 single-family units.
- In Richmond, CA, EnviroFinance Group provided a loan to the Richmond ROA of a former tank farm for the future development of a midrise condo. Providing the city with a windfall of $11 million and future TIF funding of $25-30 million.
In each of these cases, the municipalities are well positioned to capture valuable tax revenue from troubled sites that were once a strain on both the local economy and the environment. These are brownfield redevelopment tax incentives everyone benefits from.
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