Re: [CPEO-BIF] Sarbanes-Oxley Act putting mothballed sites on market

["Peter B. Meyer" <pbmeye02@louisville.edu>]

I'll echo Kris Wernstedt's comment (since we heard it together at times).

For the sake of clarity, however, let me correct an error in the opening extract from the article. Quoting the extract: 

	"...In addition, Hollingworth noted, more sites are coming on the market because of the Sarbanes-Oxley Act that prohibits companies from warehousing brownfield sites
and forces them to put them--and the cost associated with cleaning them up--on
their balance sheets."

	-- This is half wrong and half correct. The costs will have to be carried on balance sheets under FASB 147 and FIN 43 if the properties are retained (and that means that companies will have to get cleanu pcost estimates -- which means they will have a new incentive to get site assessments done and thus might be exposed to state immediate response requirements if they do such assessments), but there is NO PROHIBITION on warehousing or mothballing the sites if the firms want to retain them. 

In fact, one of the interesting questions going forward is whether the costs of carrying the liability on the books -- continuing to mothball sites -- will be high enough to drive owners to permit or promote mitigation and redevelopment despite the new liabilities that could arise for the PRP from the reuse of the sites. If the carrying costs are high enough, then new sites will be driven to the market. 

==> that's precisely what I'd like to study. 

Peter Meyer




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