2014年-世界发展银行全球_Financing_Mechanisms_for_Addressing_Remediation_of_Site_Contamination_85页_1mb

Summary of Financing Mechanisms for Addressing Remediation of Site Contamination

Core Content

This report explores various financing mechanisms used globally to address the remediation of contaminated industrial and commercial sites, with a focus on the United States and emerging models in Europe. It emphasizes the need for innovative and flexible financial tools to support the cleanup and redevelopment of brownfields, especially in low and middle-income countries where regulatory and policy frameworks may be underdeveloped. The report outlines six main financing mechanisms: Bond Finance Programs, Loan Fund Programs, Tax Increment & Special Assessment Finance Programs, Tax Credit & Incentive Programs, Grant Financing Programs, and Emerging Finance Models. Each mechanism is analyzed for its strengths, weaknesses, and global applicability.

Main Financing Mechanisms

1. Bond Finance Programs

• Introduction to Bond Finance: Bonds are a financial tool used to fund projects through dedicated revenue streams. They are particularly useful for financing environmental remediation and infrastructure development.

• Governmental Bonds: These are typically used for public purposes and are tax-exempt, making them attractive for lower-cost borrowing. They are limited in private sector involvement due to federal regulations.

• Private Activity Bonds (PABs): These are issued for private purposes and can be tax-exempt if they meet specific criteria. They allow for greater private sector participation but at a higher interest rate.

• Case Studies:

  • Chicago, Illinois: The Chicago Brownfields Initiative used general obligation bonds to fund cleanup and redevelopment, resulting in economic and environmental improvements.
  • Oregon: The Oregon Brownfields Program includes two funds, one supported by state revenue bonds and the other by a revolving loan grant from the EPA.
  • Ohio: The Clean Ohio Bond Program is funded by liquor sales and provides grants and loans for site assessment and remediation.
  • California: CALReUSE offers low-interest loans and grants for brownfield cleanup, with case studies showing successful redevelopment.
  • Elizabeth, New Jersey: General obligation bonds funded the transformation of a former landfill into a major commercial development.
  • Bridgeport, Connecticut: Bonds were used to finance a stadium, with revenue from gate and concession sales used to repay the debt.
  • Europe 2020 Bond Project Initiative: Project bonds are used in public-private partnerships, with Canada having a more mature system than much of Europe.

• Strengths: Flexibility, ability to seed private loan programs, tax-exempt benefits.

• Weaknesses: Limited private sector involvement with governmental bonds, higher interest rates for PABs, potential for misuse if not properly regulated.

• Applicability: Can be applied globally but require adaptation to local legal and economic conditions.

2. Loan Fund Programs

• Introduction to Debt Financing: Revolving loan funds (RLF) are a common tool for financing brownfield redevelopment.

• Administration of RLF: These funds are typically managed by local or regional governments and can be used for a variety of purposes.

• Case Studies:

  • Washington State: Utilized RLF for brownfield projects.
  • Federation of Canadian Municipalities (FCM): Collaborated on RLF initiatives.
  • Cuyahoga County, Ohio: Implemented an RLF to support brownfield cleanup.
  • California: CALReUSE is a state-administered RLF.
  • Massachusetts: Used RLF for brownfield redevelopment.

• Strengths: Flexibility, ability to provide long-term capital, can be combined with other financing tools.

• Weaknesses: Dependency on public funding, limited scalability.

• Applicability: Suitable for countries with a strong public sector and existing regulatory frameworks.

3. Tax Increment & Special Assessment Finance Programs

• Introduction to Tax Increment Finance (TIF): TIF allows for the reinvestment of future tax revenues generated from redevelopment into the initial cleanup and development.

• Why TIF?: It provides a mechanism to finance brownfield redevelopment by capturing future tax increases.

• Ideal Usage: TIF is best used for abandoned or underutilized sites where future development can generate significant tax revenue.

• Case Studies:

  • Dearborn, Michigan: Used TIF for site redevelopment.
  • Palatine, Illinois: Implemented TIF to fund brownfield projects.
  • Denver, Colorado: Utilized TIF for environmental cleanup.
  • Kansas City, Missouri: Used TIF to support redevelopment.
  • Atlanta, Georgia: Implemented TIF for brownfield projects.
  • Redford Township, Michigan: TIF was used to finance land redevelopment.
  • Scotland: TIF efforts were noted in the report.

• Strengths: Captures future tax revenue, supports long-term redevelopment.

• Weaknesses: May be politically contentious, requires long-term planning.

• Applicability: Effective in regions with strong local governance and predictable future tax revenue.

4. Tax Credit & Incentive Programs

• Introduction to Tax Credits: These are incentives provided to encourage investment in brownfield redevelopment.

• Brownfields Tax Credits: Examples include the New Market Tax Credit (NMTC) in the U.S.

• Layered Financing Approaches: Combining tax credits with other financing tools can enhance the feasibility of brownfield projects.

• Case Studies:

  • West Chester, Pennsylvania: Used tax credits for brownfield redevelopment.
  • Milwaukee, Wisconsin: Tax credits supported redevelopment.
  • Lawrence, Massachusetts: Implemented tax credit programs.
  • San Francisco, California: Used tax incentives for brownfield cleanup.

• Strengths: Encourages private investment, can be combined with other funding sources.

• Weaknesses: Limited scope, depends on local tax policies.

• Applicability: Can be applied globally, but effectiveness depends on the local tax system.

5. Grant Financing Programs

• Introduction to Grants: Grants provide direct funding for brownfield remediation without requiring repayment.

• Types of Grants: Include federal, state, and local grants, such as those from the U.S. EPA and HUD.

• Clawbacks: Some grants may include conditions that require repayment if certain benchmarks are not met.

• Case Studies:

  • U.S. EPA Grant Programs: Fund various environmental activities.
  • HUD Brownfields Economic Development Initiative (BEDI): Supports economic development through brownfield cleanup.
  • Michigan Department of Environmental Quality: Provides grants for brownfield redevelopment.
  • Connecticut: Offers municipal grants for brownfield projects.
  • Oklahoma City: Implements a brownfield redevelopment program.
  • Hennepin County, Minnesota: Uses the Environmental Response Fund (ERF) for cleanup.

• Strengths: No repayment required, supports community development.

• Weaknesses: Limited funding, potential for misuse.

• Applicability: Effective in countries with strong public funding mechanisms.

6. Emerging Finance Models

• Public-Private Partnerships (PPPs): These models involve collaboration between public and private entities to fund and manage brownfield projects.

• The Gingko Fund: A private initiative in Belgium that provides funding for brownfield redevelopment.

• Case Studies:

  • Webster, Texas: PPP with Cherokee Investment Partners.
  • Indianapolis: Brownfield initiative involving local governments and private entities.
  • Rudolstadt, Germany: Used innovative financing for brownfield projects.
  • Vienna, Austria: Implemented sustainable financing models.
  • Liverpool, UK: Utilized PPPs for brownfield redevelopment.
  • Burcht, Belgium: Case of the Gingko Fund.
  • Versailles-Satory, France: PPP model for site remediation.
  • Detroit Land Bank Authority: Combines land banking with redevelopment.

• Strengths: Innovation, flexibility, potential for private investment.

• Weaknesses: Complexity, need for strong regulatory frameworks.

• Applicability: Emerging models can be adapted globally but require local adaptation and regulatory support.

Key Information

• Contaminated sites pose significant economic and environmental risks, necessitating innovative financing solutions.
• Bond financing is a common tool, especially in the U.S., with governmental and private activity bonds serving different purposes.
• Loan funds offer a flexible and sustainable approach, often used in conjunction with other mechanisms.
• Tax increment and special assessment financing allow for reinvesting future tax revenues into initial cleanup efforts.
• Tax credits are incentives that can attract private investment and support redevelopment.
• Grants provide direct financial support, often from government agencies, but may have limitations.
• Emerging models, such as public-private partnerships, offer new opportunities for financing and managing brownfield sites.

Conclusion

The report underscores the importance of diverse and adaptable financing mechanisms in addressing contaminated site remediation. It highlights the role of the World Bank and external agencies in developing and promoting these tools. Each mechanism has its own strengths, limitations, and applicability, depending on the local legal, economic, and regulatory environment. The case studies illustrate how these mechanisms can be effectively implemented in various contexts, from the U.S. to Europe. The report serves as a guide for communities and countries seeking to finance brownfield remediation and redevelopment, emphasizing the need for tailored approaches and strong policy frameworks.