Superfund

During the past several decades, manufacturing has been on the decline in many U.S. cities. When businesses close, they often leave behind abandoned and idled properties, known as "brownfields," which are sometimes contaminated with chemical wastes. To avoid the cost of assessing and cleaning up these properties in accordance with federal and state environmental laws, some new businesses have opted to locate in uncontaminated sites outside cities. These decisions have deprived central city neighborhoods of tax revenues and employment opportunities. This testimony draws on the findings of a June 1996 report (GAO/RCED-96-125). GAO discusses the (1) legal barriers that the Superfund legislation poses to redeveloping brownfields and (2) types of federal financial support that states and localities would like to help them address such properties.

GAO noted that: (1) Superfund's liability provisions make brownfields difficult to redevelop, in part because owners are unwilling to identify contaminated properties and prospective developers and property purchasers are reluctant to invest in a redevelopment project that could leave them liable for cleanup costs; (2) while brownfields are usually not contaminated seriously enough to be listed as Superfund sites, these parties still fear that they may be sued under Superfund and state laws for cleanup costs if they become involved with a contaminated property; (3) in addition, most of the voluntary cleanup program managers in the 15 states GAO surveyed judged that volunteers' concerns about being held liable for a property under federal Superfund law, once a cleanup is complete, discouraged some of them from initiating a cleanup; (4) both bills include provisions that would help to address these concerns, including provisions to limit liability for some prospective purchasers; (5) to help promote the redevelopment of brownfields, states and localities would like federal financial support to cover some of the costs of assessing these properties for contamination, cleaning them up, and developing their voluntary cleanup programs; (6) over the past few years, the Environmental Protection Agency (EPA) and Congress have provided some funds which states and localities have used for activities such as developing an inventory of brownfield properties; (7) funding provisions in the bills would continue and expand this support and respond to the states' and localities' needs; (8) for example, Senate bills S. 8 and S. 18 would authorize EPA to provide grants to support the characterization and assessment of brownfields; (9) GAO determined that the amounts of the grants proposed in the bills for these activities would be sufficient to cover the costs for most brownfield properties; and (10) additional provisions in the bills for grants to fund some cleanup costs and provisions in S. 8 to fund the development of state voluntary cleanup programs should also promote brownfield cleanup and redevelopment.