Brownfields tax incentives helped redevelop Merchandise Mart on Washington Avenue in St. Louis. Via Flickr.
This week, Congresswoman Elizabeth Esty (D-CT) introduced the Brownfields Redevelopment Tax Incentive Reauthorization Act of 2014, or H.R. 4542. The legislation would re-establish the brownfields tax incentive for five years through 2018. In a bipartisan show of support for the bill, Congressman Tim Bishop (D-NY) and Congressman Chris Gibson (R-NY) have signed on as cosponsors.
Originally signed into law in 1997 and extended through December 31, 2011, Section 198’s Brownfields Tax Incentive is a tax deduction intended to encourage the cleanup and revitalization of brownfield properties. Under the incentive, environmental cleanup costs are fully deductible in the year incurred, rather than capitalized and spread over time. Improvements in 2006 expanded the Incentive to include petroleum cleanup.
The Brownfields Tax Incentive has been an integral part of the redevelopment of many former contaminated sites. In St. Louis, the vacant Merchandise Mart building was redeveloped in 2001 into a 213 unit mixed-income apartment redevelopment that helped revitalize the Washington Avenue Lofts District. With over $12 million in remediation costs, the project greatly benefitted from the brownfields tax incentive.
In Milwaukee, the Clock Shadow Building was completed in 2012 on a former brownfield site and is now a mixed-use office building that includes amenities for the neighboring community. The building is an example of sustainable development, having achieved a 45 percent reduction in energy use relative to conventional construction.
Smart Growth America and the National Brownfields Coalition are supportive of this legislation and are also calling for the passage of the Brownfields Utilization, Investment, and Local Development (BUILD) Act of 2013, which recently passed through the Senate Committee on Environment and Public Works.