$3 million offered for cleanup, tests of industrial sites Matching grants, loans are incentives to fix up brownfields

Empowerment zone areas

November 25, 1997|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

Hoping to draw new industry and jobs to Baltimore's vacant or underused industrial sites, the Empower Baltimore Management Corp. is offering $3 million in loans and grants to developers and land owners to clean up contaminated properties.

Matching grants totaling $500,000 will cover costs of environmental testing, while a $2.5 million revolving loan pool will help finance cleanup of land in the city's federally designated empowerment zones, the corporation said yesterday.

Working with other city agencies, the nonprofit Empower Baltimore is targeting the Fairfield industrial area in South Baltimore and the Carroll-Camden Industrial Park, adjacent to the stadiums, where about 230 acres likely have contaminated soil, the corporation said.

"We think we have real viable land options sitting inside the city and sitting inside the zone that can be transformed into jobs," said Diane Bell, chief executive and president of the nonprofit corporation managing the city's $100 million federal empowerment zone fund.

Because of unknown contamination and the costs of environmental testing for oil or metals in the soil, it is often prohibitive to redevelop former industrial sites, known as brownfields.

"A lot of times developers are skeptical in terms of purchasing property that was once industrially used because they don't know what kind of contamination there was, and it's difficult to get loans for testing and cleanup," said Charles C. Graves III, director of the city's Department of Planning. He estimated that a third of all the city's vacant and underused industrial land has been contaminated.

A state law that took effect this year reduced prospective purchasers' future liability for previous contamination. But most developers still lacked the means to do the testing and cleanup.

The program attempts to fill a gap in financing, as most banks will not make loans for environmental testing or remediation, which can include filtering or removing soil.

"Initially, it helps remove the question mark over some of these sites," making it easier to approach lenders for construction or other financing, said Larisa Salamacha, a senior development officer with the Baltimore Development Corp., a partner in the brownfields program.

Baltimore's brownfields sites, once redeveloped, could create up to 2,700 jobs and generate $2.3 million in local real estate tax revenues, Graves estimated.

Sites in the Fairfield area, for instance, have access to water, rails and highways, are close to downtown and to the airport, Salamacha said. The city hopes to recruit light manufacturers, especially those considered environmentally conscious, as well as warehouse industrial space and assembly uses.

Current property owners, developers or potential buyers are eligible for matching grants of up to $50,000, with half the cost coming from another source. Maximum loans are $250,000 -- or $500,000 if the developer matches the second $250,000 with private investment.

City officials hope the initial funding will entice the private sector to invest in redevelopment.

Pub Date: 11/25/97

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