Brownfields and Greater Binghamton Revitalization

Presentation of Kenneth S. KamletDirector of Legal Affairs,

Newman Development Group, LLC

To Broome Leadership InstituteGreater Binghamton Chamber

Oct. 28, 2004

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Who I Am—My Background

Director of Legal Affairs, NDG—’97-Present Education: Penn Law—JD, ’73; Yale U.—

M.Phil.,’70—Biochem. Sciences; CCNY—B.S.,’66—Biology.

Pollution & Toxics Director, and Director of Legal Affairs— Nat’l Wildlife Fed.—’73-’85

Environmental Consultant—’85-’92 Private Law Practice—’92-’97

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Outline of Presentation

What’s a “Brownfield”?Project examples (8 in Greater

Binghamton)New NYS Brownfields LawCurrent ControversyConclusion

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What’s a “Brownfield”?

“Any real property, the redevelopment or reuse of which may be complicated by the presence or potential presence of a contaminant [hazardous waste, petroleum, or pollutant]….”

Exclusions: site that is subject to any on-going state or federal environmental enforcement action related to the contamination

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Project Examples--1

Vestal Town Square Mall– Public opposition– Brownfield site (asphalt plant, etc.)Brownfield site (asphalt plant, etc.)– Wetlands– Geotechnical issues– Real estate recession– SEQRA litigation– Subsequent TSM Expansion

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Vestal Town Square Mall

Original Wal-Mart

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Project Examples--2

Shoppes at Vestal– Brownfield site (former meatball factory)Brownfield site (former meatball factory)– 3-sided culvert– Wetlands– Stormwater management– Vestal Rail-TrailVestal Rail-Trail– Streambank erosion adjacent to Town Park

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The Shoppes at Vestal

View of Meatball Factory from Vestal Parkway

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Project Examples--3

Vestal Rail-Trail

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Project Examples—4

Vestal Lowe’s– Originally part of petroleum tank farm

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Vestal Lowe’s

Town Square Mall

Petroleum Tank Farms

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Project Examples--5

Gannett Corp. regional printing press facility

Former Endicott-Johnson Ranger Paracord Site

Architect’s rendering of new printing press facility

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Ranger Paracord/Gannett, cont’d

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Ranger Paracord/Gannett, cont’d

Total site = 27.41 acres; Gannett parcel is 11.56 acres State-of-the-art, high-tech printing press from Wurzburg,

Germany will rise to a height of 6 stories in a 96,000-sf building

It will service Gannett papers from not only Binghamton, but also Elmira and Ithaca

The building will also house distribution and paper storage facilities

Site was chosen because of proximity to 3 major interstates (I-81, I-88, and future I-86)

Also, hopefully, to catalyze similar efforts to revitalize other dormant industrial sites in Greater Binghamton

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Project Examples—6

Parkway Plaza– Replacement of former factory (Ozalid

plant) and old shopping center (Century Plaza)

– Another example of a brownfield revitalization

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Parkway Plaza

Former Ozalid Factory

--looking southeast

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Parkway PlazaTown Square MallGiant Food Store

Former Ozalid factory

Former Century Plaza

Former Video King location

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Project Examples—7

Vestal Plaza/Vestal Park– Failed, deteriorating shopping center– Addition of office uses (NCI, AIG)– Addition of Ames / bankruptcy of Ames– Addition of student housing

Not a Brownfield (but maybe a “grayfield”—Not a Brownfield (but maybe a “grayfield”—real property that is declining in use, but not real property that is declining in use, but not contaminated)contaminated)

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Vestal Plaza/Vestal Park

AIG Call Center

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Vestal Plaza / Vestal Park

Old Vestal Plaza—pre-Newman

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Vestal Plaza/Vestal Park, cont’d

Artist’s Rendering—Student Housing

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Project Examples—8

Chenango Plaza/Lowe’s– Voluntary cleanup agreement negotiated

with DEC in 1996– It took >6 years and >$250,000 to secure

a liability release– Much time and money was spent because

many people could say “No” and require more study, but only one person could say “Yes”

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Chenango Plaza / Lowe’s

I-81

Old Chenango Plaza

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Chenango Plaza

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Chenango Plaza / Lowe’s

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New NYS Brownfields Law

A. 9120 approved by Assembly June 20th per 3-way agreement; Senate passes wrong bill

Senate reconvenes September 16th and passes A. 9120 / S. 5702 by a 51-9-2 vote

Governor participates in Babylon, Long Island event Sept. 17th—planned to sign bill, but it doesn’t make it there in time.

Signing occurred in October 2003—a little over a year ago

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Brownfields Bill (A. 9120)

For more information about the

new Brownfields legislation and

its genesis, please consult my

New York Brownfields website:

www.ny-brownfields.com

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New NYS Brownfields Law

107 pages Has positive and negative features All western New York Senators (Buffalo, Rochester,

etc.) voted against it They were concerned that the legislation would not

significantly benefit redevelopers of Upstate BF sites 48-page Technical Correction Amendments

approved by the Legislature on Aug. 11, 2004

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BF Benefit-Risk Matrix

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VCP Risk/Benefit MatrixVCP Risk/Benefit Matrix

Threshold SitesThreshold Sites

VIABLE VIABLE SITESSITES

NONNON--VIABLE VIABLE SITESSITESLOW ROI, LOW RISKLOW ROI, LOW RISK

HIGH ROI, HIGH RISKHIGH ROI, HIGH RISK

Risk of Environmental Liability

EXPECTED

ROI

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New NYS Brownfields Law

Main Positive Features:– Financial incentives (tax credits, including one for

environmental insurance; priority assistance for sites in BOAs)

– Improvements to Environmental Restoration Program & ability to stay foreclosure proceedings

– Adoption of federal liability exemptions– Workable cleanup goal & use-based cleanup track– Relaxed liability for current owners– Liability release binding on State, not just DEC– Greater certainty and finality

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New NYS Brownfields Law

Main negative features:– Several provisions that may make innocent owners

reluctant to enter into BCAs “mothballing”– Several provisions that may discourage BF real estate

transactions—especially Upstate—because of added red tape, cost, and delay

– Failure to carry use-based cleanups over to municipally-owned BF sites

– Failure to change DEC’s organizational structure– Adding extra site investigation costs to outstanding tax bills

may discourage redevelopment

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Current Controversy

Forest City Ratner/New York Times project– 52-story office tower on Eighth Ave & 40th St--

$850-million project– Never industrial– Limited contamination– Highly desirable Times Square real estate– Deal was committed to before new BF law– Seeking >$170-million in BF tax credits

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Current Controversy, cont’d

DEC has proposed new guidance to allow it to disqualify sites based on:– Limited contamination in relation to the value of

the deal—BF status is not “complicating” the property’s development or re-use

– Even if the property meets the definition of a BF, if it is not in the “public interest” to grant it BF status

Legislators are threatening to amend the law to cap or roll back BF tax credits

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Conclusion

The new Brownfield Cleanup Program can be a very significant economic development tool.