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The Business Council strongly supports this legislation, which will extend and reform the Brownfield Cleanup Program tax credit until March 31, 2025.
The Business Council strongly supports efforts to extend the Brownfield Cleanup Program. This program works for the environment. It works for economic development. And, it works for New York State.
Unless extended, the BCP tax incentives will expire on December 31, 2015. This will result in very few new sites entering the program and/or being remediated and redeveloped, since it is unlikely that new sites will be completed by the time the tax incentives end.
The BCP has proven to be a catalyst for private-sector investment in the cleanup and redevelopment of contaminated properties. The BCP was established to allow for the voluntary clean up and redevelopment of contaminated real property. By design, the program allows investors to offset a portion of their site preparation and redevelopment costs through state tax credits.
Data from the Department of Environmental Conservation shows that every state dollar awarded under the brownfield tax credits was matched by $6.78 in private sector investments. Since 2007, the BCP has generated more than $6.5 billion in private sector investment across New York State.
This proposed legislation makes several significant adjustments and modifications to the current program. Key reforms include:
- Extension of the BCP redevelopment tax credits for 10 years ;
- Reform of the tangible property credit to ensure that it is targeted to priority areas and sites, in those in underserved areas, and brownfields that are underutilized, functionally obsolescent, or “upside-down” (i.e., site values are exceeded by cleanup costs;)
- Allowing for “bonus” tax credits for projects located in an Environmental Zone or BOAs, that result in affordable housing, and/or are manufacturing sites;
- Creation of a fast-track project approval process, without access to tax credits, that maintains state oversight of cleanups and liability releases; and
- Clarification of existing provisions of the BCP and improvements in the administration of the program.
The BCP is the single most effective tool in stimulating economic growth and the redevelopment of contaminated, post-industrial sites across the state. The program effectively facilitates the redevelopment of former industrial lands prevalent throughout our communities, by making projects with exorbitant remediation costs financially feasible for developers.
The BCP has leveraged more than 21,000 new jobs and nearly $7 billion in development, across almost 100 projects since the program's inception. With the program currently scheduled to sunset in December 2015 new projects are already out of time.
Therefore, The Business Council strongly supports the program extension and reforms set forth in S.4209 Part R.