[CPEO-BIF] CPEO-BIF thread on measuring success

["Kris Wernstedt" <krisw@vt.edu>]

CPEO types,

EPA sponsored a small workshop several years ago on trying to get a handle
on community impacts from reusing properties.  It's a bit dated, but some of
the workshop material is still posted on

www.rff.org/rff/Events/Estimating-Community-Economic-Impacts-from-the-Reuse-
of-Contaminated-Properties.cfm

I wrote one of the background papers for the workshop ("Overview of Existing
Studies . . .", downloadable from the website) on various past quant efforts
to measure success.  It's a lot of blah blah blah but might have some useful
background info, particularly for your June 15th conference, Lee.  

Best regards,

Kris


*************************************
Kris Wernstedt
Urban Affairs and Planning
Virginia Polytechnic Institute and State University
Alexandria Center
1021 Prince Street, Suite 200
Alexandria, Virginia 22314
703-706-8132 (voice), 703-518-8009 (fax)
krisw@vt.edu, www.uap.vt.edu/thePeople.htm
*************************************
 

> -----Original Message-----
> From: brownfields-bounces@list.cpeo.org 
> [mailto:brownfields-bounces@list.cpeo.org] On Behalf Of Ilan, Lee
> Sent: Tuesday, May 29, 2007 10:31 AM
> To: Brownfields Internet Forum
> Subject: RE: [CPEO-BIF] Data on New York's Brownfields Cleanup Program
> 
> I'm very glad to see this conversation going on now.  I'm 
> facilitating a panel for the NBA's Tri-State (that's 
> NY-NJ-CT) conference on 15 June on "Measuring Success" of 
> brownfield redevelopment, and this discussion is raising some 
> interesting issues.  
> 
> It's clear that what defines success often depends on your 
> perspective (developer, regulator, community group, owner, 
> economic development agency, etc.)  And the question of how 
> to measure it has multiple answers as well.  It does not 
> appear that there is any one agreed-upon methodology that 
> everyone uses to demonstrate that particular public 
> investments (such as tax credit programs) are worthwhile. 
> Further, I'm always curious when "new jobs" are reported - is 
> this a projection, or self-reported accomplishments, or are 
> the analysts invited to examine payroll logs?  
> 
> Good stuff - keep those cards & letters coming!
> --Lee
> 
> Ms. Lee Ilan
> Senior Environmental Planner
> Mayor's Office of Environmental Coordination City of New York
> 253 Broadway, 14th Floor
> New York, NY 10007
> Tel. 212-788-2929
> Fax 212-788-2941
> lilan@cityhall.nyc.gov
> URL: www.nyc.gov/oec
> 
> -----Original Message-----
> From: brownfields-bounces@list.cpeo.org
> [mailto:brownfields-bounces@list.cpeo.org] On Behalf Of 
> Bruce-Sean Reshen
> Sent: Monday, May 28, 2007 6:13 PM
> To: 'peter '; lsiegel@cpeo.org; 'Brownfields Internet Forum'
> Subject: RE: [CPEO-BIF] Data on New York's Brownfields Cleanup Program
> 
> Peter,
> 
> Why do you say that the qualitative factor "benefits to the community"
> is missing?
> I beg to differ with your analysis.
> 
> Larry mentioned numerous quantitative measures that all serve 
> as proxies for benefits to the community.  Number of 
> cleanups, dollar size of cleanups, dollar size of 
> redevelopments and number of jobs created in the community 
> all are valid proxies for measuring benefits to the community.
> 
> However, there is one item in Larry's analysis that does 
> require further examination.  When Larry says, " the amount 
> of cleanup dollars accomplished by the BCP that would not 
> have ordinarily been accomplished or would have had to been 
> incurred at the taxpayers expense,"  he is implicitly 
> assuming that tax credits should not be regarded as an 
> "expense to the community".  But, of course, tax credits 
> represent dollars of tax not collected by the government; 
> dollars that could be used to improved conditions in the 
> various communities of the state ( even assuming that a 
> percentage of the foregone tax dollars would be lost in 
> "administrative waste").  Thus, the best measure of the value 
> of the BCP would the leverage impact of the tax dollars, 
> meaning the extent to which the value of the redevelopment 
> and cleanup exceeds the "cost"
> of the tax benefits.
> 
> Bruce
> 
> 
> Bruce-Sean Reshen
> p. 203-259-1850
> c. 917-757-5925
> 
> -----Original Message-----
> From: brownfields-bounces@list.cpeo.org
> [mailto:brownfields-bounces@list.cpeo.org] On Behalf Of peter
> Sent: Monday, May 28, 2007 5:20 PM
> To: lsiegel@cpeo.org; 'Brownfields Internet Forum'
> Subject: RE: [CPEO-BIF] Data on New York's Brownfields Cleanup Program
> 
> Larry:
> 
> I agree with the others that this is good and useful work, so 
> please don't take my comments as a major critique.
> 
> I have difficulty understanding the reasoning behind your 
> first conclusion (that the percentage of cleanup costs to 
> development costs does not appear to be a useful metric for 
> determining the effectiveness of a Brownfield program).  
> Wouldn't it be sound public policy to concentrate efforts 
> that have the most return?  Don't overall development costs 
> represent a proxy of expected economic return (as well as 
> construction jobs)?  It seems to indicate where you get the 
> most bang for your buck. Perhaps the ratio is not the only 
> metric to be used when assessing the value of the BCP 
> program, but it seems to me that it is useful for policy makers.
> 
> I would also be interested in how you are determining Cleanup 
> Costs net of normal excavation/construction costs.  Are you 
> able to get data on net excavation/construction costs?
> 
> One qualitative factor that seems to be missing is the 
> benefit to the community.
> 
> Peter Strauss 
> 
> -----Original Message-----
> From: brownfields-bounces@list.cpeo.org
> [mailto:brownfields-bounces@list.cpeo.org] On Behalf Of Lenny Siegel
> Sent: Sunday, May 27, 2007 8:52 PM
> To: Brownfields Internet Forum
> Subject: [CPEO-BIF] Data on New York's Brownfields Cleanup Program
> 
>  From Larry Schnapf
> <LSchnapf@aol.com>
> 
> During the past few months, a number of environmental lawyers 
> and consultants have graciously volunteered their time to 
> help me gather certain information about sites that have been 
> accepted into the New York State Brownfield Cleanup Program 
> (BCP) and have either received Certificates of Completion 
> (COCs) or are currently being remediated.
> 
> Our goals were to develop some objective information about 
> the BCP projects as the new administration considers making 
> changes to the law. 
> We felt that the decision-makers should be armed with hard 
> facts  before
> 
> they decide how to amend the program, and not be distracted 
> by anecdotal
> 
> accounts or research that might be influenced by the agendas 
> or interests funding those research efforts.
> 
> When we started our initiative, we had no idea what the 
> results of the our investigation would reveal or where it 
> would take us. We decided to gather the following categories 
> of information: Current Use; Proposed Use; Nature of 
> Contamination; Nature of Remediation/cleanup track; Estimated 
> Cleanup Costs (net of normal excavation/construction costs); 
> Estimated No. of construction/permanent jobs; and 
> Pre-Application Transaction Costs.
> 
> This task was made more difficult because there was no 
> central repository for this kind of information. As a result, 
> our volunteers had
> 
> to do the arduous and tedious work of collecting data from 
> persons involved in the BCP.
> 
> One of first conclusions we reached was that the percentage 
> of cleanup costs to development costs does not appear to be a 
> useful metric for determining the effectiveness of a 
> brownfield program. For example, some
> 
> projects in NYC have had very expensive cleanups at sites 
> that have been
> 
> dormant for decades yet the % of cleanup costs to project 
> costs for these sites frequently hover around 1% to 2% 
> because of the enormous vertical development costs of these 
> projects. In contrast, the range cleanup costs at upstate 
> sites seem to range between 5%-10%. Some upstate sites might 
> have cleanup costs approaching 40% of the total costs yet all 
> they're doing is pulling a few tanks and removing some soil. 
> Contrary to conventional thinking, most of the 25 COCs issued 
> during the past year are not from the NYC area but from 
> upstate projects.
> 
> Another conclusion that seemed to jump out to me at least is 
> that the number of sites cleaned up is not as important as 
> the number of jobs created and the amount of cleanup dollars 
> accomplished by the BCP that would not have ordinarily been 
> accomplished or would have had to been incurred at the 
> taxpayers expense.
> 
> Thus far, the preliminary results of our research indicate 
> appears that BCP cleanup costs are averaging $1 MM to $10 MM 
> per site with several NYC projects having cleanups 
> approximating $20 MM. In region 2 alone (which is where NYC 
> is located), it looks like the BCP has generated at least 
> $100MM in cleanup costs-this is cleanup that would not have 
> been done or cleanup dollars that would have been incurred by 
> the taxpayers but for the BCP. The data we have collected 
> thus far suggests that approximately 80% of the projects of 
> the NYC projects exceed $40 MM in total development costs and 
> 50% exceed $100 million.
> 
> It also appears that the transaction costs to get a site into 
> the BCP are ranging from $25 K to $50 K. The cost vary 
> depending on how much work the applicant does to prepare for 
> the pre-application meeting and the resources it devotes to 
> the application. In my opinion, the pre-application meeting 
> is the single most important step of the BCP process since 
> this is the only time that applicants will have a change to 
> meet face-to-face with some of the staff who will be making 
> the decision on their application and will also be able to 
> learn what DEC will be expecting to see in the application. 
> Applicants would be well advised to be fully adequately 
> prepared to discuss their project, its benefits and how 
> enrollment in the BCP is crucial to the success of the project.
> 
> The NYC jobs tend to generate around 200 construction jobs 
> and 50-100 permanent jobs depending on the type of project, 
> with residential generating less permanent jobs. Indeed, 
> three of the COCs in NYC generated approximately 1756 jobs.
> 
> I think our preliminary data shows that the BCP is not 
> "broken" but is, in fact, definitely accelerating cleanups. 
> While the tax credits might be tweaked somewhat to encourage 
> more cleanups in poorer neighborhoods and more affordable 
> housing projects, it does seem that the BCP is accomplishing 
> what it set out to do-namely incentivizing cleanup and 
> redevelopment of sites. The very generous tax credits do seem 
> to be attracting capital and investment to sites that have 
> long underutilitized or "warehoused." A number of BCP 
> applicants are implementing extensive source removal and site 
> characterization at sites
> 
> where remediation has been going on at a snails pace for a 
> decade or more. The applicants were willing to take on the 
> risk of site redevelopment without knowing the full range of 
> site remediation costs because of the generous tax credits.
> 
> Another interesting issue that I have been encountering is 
> the sheer volume of misinformation out there about the BCP. I 
> seem to get a call every two or three weeks from for profit 
> and affordable housing developers sharing with me some 
> bizarre advice they have received about what the BCP is 
> requiring and what sites are allowed into the program. I
> 
> suspect  this misinformation is based on individuals or 
> groups extrapolating experiences with individual sites into 
> programmatic policy. Each application is a site-specific 
> determination and when one reviews the list of sites that 
> have either been rejected or have withdrawn their 
> applications, these anecdotal stories do not hold up under 
> scrutiny. The most common misconceptions that I have heard to
> date: petroleum sites are not being admitted into the 
> program, only upstate sites are being allowed into the 
> program and that only sites with at least $1 MM in cleanup 
> costs are accepted.
> 
> It has been a long and hard process and our volunteers have 
> had sacrifice much of their personal time to dig up this 
> information without
> 
> any compensation. We hope to have our final findings by the 
> end of June.
> 
> Larry
> 
> 
> --
> 
> Lawrence Schnapf
> 55 E.87th Street #8B/8C
> New York, NY 10128
> 212-876-3189 (h)
> 212-756-2205 (w)
> 212-593-5955 (f)
> 203-263-5212 (weekend)
> www.environmental-law.net
> 
> 
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