RENEWED INTEREST IN BROWNFIELD REMEDIATION (2022)

Brownfields are an ongoing problem in communities across Canada. They affect both large cities and small rural municipalities, and can be any size – from small, former gas stations to large chemical processing sites.

Brownfields can be defined as “abandoned, vacant, derelict, or underutilized commercial or industrial properties where past actions have resulted in actual or perceived contamination and there is an active potential for redevelopment.” (National Roundtable on the Environment and the Economy, 2003)

Background

Whether these sites are large or small, there are costs to inaction, and according to the Province of BC, there are anywhere from 4000-6000 brownfield sites across the province, and the Province does not have an inventory of sites province-wide.[1] Brownfields can blight neighborhoods, impede municipal development or investment, lower property values, result in unpaid taxes, and increased enforcement and policing costs. That’s not to mention the potential environmental damage, contaminated soil and groundwater, safety, and health risks. Many of these can be found on the BC Ministry of Environment Site Registry, but this has limitations. The Site Registry is not solely a registry of contaminated sites, and it does not clearly outline the steps to redevelopment potential needed on each site.

Municipalities can play an important role in encouraging remediation, even on privately owned land, with planning, proper zoning and incentives for developers. In some case municipalities may also own contaminated sites themselves or have assumed responsibility for such sites.

The provincial government plays an important role in setting out the legislative framework, as well as supporting the assessment and remediation/risk management activities that need to take place. Unfortunately, the overly complex process includes up to 16 procedures to follow for a site to be considered remediated, and leaves many property owners or prospective developers unable to navigate the bureaucratic process. Furthermore, once remediation work has been undertaken, property owners or potential buyers are often left waiting for years to receive contaminated sites legal instruments, such as a Certificate of Compliance that confirms that a site meets numerical or risk-based standards following remediation.

The Federation of Canadian Municipalities (FCM) has played a leading role in supporting communities and private sector partners. They provide grants for planning and loans for remediation projects at low cost.

Ontario was the first province in Canada to recognize that the upfront costs faced in the development of brownfields is a barrier to redevelopment, and therefore created incentives in 2004. The Brownfields Financial Tax Incentive Program (BFTIP) is an initiative of the government of Ontario to encourage the cleanup and redevelopment of brownfield properties. It allows municipalities to provide property tax assistance to property owners in connection with environmental rehabilitation of brownfields properties within an approved community improvement project area. It also provides provincial tax incentives that match the municipal tax assistance (through a reduction in the provincial education portion of the taxes for that property). Other jurisdictions in Canada, including British Columbia, have followed Ontario’s lead with their own programs and incentives.

The Province of BC has, in the past, played a leadership role with its Brownfield Renewal Strategy, which helped to build awareness of brownfield issues. It encouraged communities to take advantage of the Revitalization Tax Exemption through the Community Charter, which allows municipalities to provide property tax exemptions for brownfield redevelopment projects (similar to the municipal property tax assistance portion of Ontario’s program). The strategy included funding for site assessments as ‘seed’ money to assist in moving brownfield sites across the province back into productive use. The five-year Funding Program granted approximately $7 million towards site assessment projects and was completed in 2013/2014.

It is important that BC regains its momentum, and to recognize that brownfield redevelopment is a business issue. It is also an issue that has already fallen off of the provincial government agenda because real estate is so valuable in certain areas of the Province. That is not the case for small, medium, and rural communities across BC where there is less valuable real estate and less access to capital for redevelopment purposes. The Province’s Brownfield Renewal Strategy website acknowledges that Brownfield redevelopment can:

• improve local economic growth;
• increase local tax revenue from redeveloping vacant & underused properties;
• enhance land values surrounding redeveloped brownfields;
• replace lost jobs by creating space for new industry on redeveloped brownfields;
•  and be a catalyst for surrounding development, creating a favourable climate for more brownfield redevelopment projects. 

FCM has noted that for every $1 invested in brownfield redevelopment, an average of $3.80 is invested in the economy. The Union of BC Municipalities has also advocated for improvements to the provincial policies on brownfields taxation after a resolution was passed in 2018. Further progress can be made to enhance transparency on liability issues (often historic information is needed to clearly identify who is responsible for the remediation), and on-site specific information for developers. Additionally, incentives are needed for private sector motivation to encourage remediation on land that is known to be contaminated and would not be redeveloped otherwise.

THE CHAMBER RECOMMENDS

That the Provincial Government:

1. Update the BC Brownfield Renewal Strategy, and continue to provide municipalities and developers with clear rules, incentives, and information;
2. Develop a simplified set of guidelines and procedures with defined timeline requirements for Ministry of Environment officials to process contaminated sites legal instruments;
3. Develop an inventory of all brownfield sites in British Columbia that are available for redevelopment so that municipalities and developers have clear awareness of redevelopment opportunities that are eligible for incentives through provincial programs, the FCM Green Municipal Fund, or other programs;
4. Create incentives for brownfield remediation activity by canceling or deferring the provincial portion of property taxes and permit local governments to match these incentives through the Revitalization Tax Exemption, currently available to communities through the Community Charter; and
5. Consider re-investment in the Brownfield Renewal Strategy Funding Program for the next 3-year budget cycle.

[1] https://www2.gov.bc.ca/assets/gov/environment/air-land-water/site-remediation/docs/fact-sheets/fs38.pdf.