Moving Beyond Cleanup: Identifying the Crucibles of Environmental Gentrification

This paper reviews the distributional impacts associated with "environmental gentrification" following the cleanup and reuse of LULUs. By making a neighborhood more attractive, cleanup and reuse of LULUs may drive up local real estate prices. Renters in the neighborhood would have to pay higher rents. Moreover, existing residents may not value the removal of the disamenity as much as other households, creating a mismatch between their priorities and the new character of the neighborhood. Thus, even if they do not move, existing residents, especially renters, may be harmed by the gentrification effects of cleanup. We find that even a simple economic model does not yield clear predictions on neighborhood effects following cleanup, except for the initial effect of rising housing values. In the empirical literature, we actually find conflicting evidence of rising real estate prices following cleanup of LULUs. We find somewhat stronger evidence for increased housing density and increasing incomes, but no evidence for racial impacts. Our review also uncovers a variety of factors that are likely to minimize the likelihood of gentrification or temper its adverse consequences. Working Paper 07-2

Environmental Risk Perceptions of Commercial and Industrial Real Estate Lenders

This study analyzes the risk perceptions of commercial and industrial mortgage lenders related toenvironmental contamination. Two research questions are addressed. The first is whether perceived risks vary with a property’s remediation/cleanup status. The second is whether market conditions have an intervening effect on environmental risk. An analysis of national lender survey data found significant differences in perceived risk before, during and after cleanup, with most lenders unwilling to make a loan before cleanup and a majority willing to loan at typical rates and terms after cleanup. The study also found that strong market demand significantly reduces risk while weak demand increases risk.

Environmental Justice: Challenges of Contaminated Site Cleanup in Rural AK

A shorter version of this article appeared on pp. 1–4 of the Summer 2018 print edition.Efforts to clean up contaminated sites from military installations and other sources have been ongoing in Alaska since the 1980s, and new sites continue to be identified. Most Formerly Used Defense Sites (FUDS) properties are in remote locations, placing a disproportionate impact on Alaska Native communities that depend upon environmental resources for their livelihood. Cleanup projects that are begun may take many years to complete due to the complicated nature of each site. Since 1990, over 5,300 sites have been cleanup up; more than 2,200 sites remain open, including military installations (both abandoned and active), bulk fuel storage and gas stations, airports and airfields, maintenance facilities, and oil exploration, transport, and refining facilities.Superfund and FUDS / Multiple projects and parties / FUDS closure but site still open / DEC closed sites vs. open sites / Assessing risk / [Sidebar:] Cleanup in rural Alaska is expensive and complicated / Liability and costs of cleanup / Financing assessment and remediation / Federal funds / Reference

Determinants and Effects on Property Values of Participation in Voluntary Cleanup Programs: The Case of Colorado

State Voluntary Cleanup Programs (VCPs) were established starting in the 1990s to encourage the environmental remediation and redevelopment of contaminated properties. These programs typically offer liability relief, subsidies and other regulatory incentives in exchange for site cleanup. This paper asks three questions: First, what type of properties are attracted to voluntary cleanup programs? Second, what is the interaction between these state programs and other incentives for remediation and economic development, such as Enterprise Zone and Brownfield Zone designations? Third, what is the effect of participation in the VCP on property values? We use data from Colorado’s VCP to answer these questions. We find that most of the properties enrolled in this program were not previously listed on EPA’s contaminated site registries, and that most applicants seek to obtain directly a “no further action” determination without undergoing remediation. The main determinants of participation are the size of the parcel and whether the surrounding land use is primarily residential, while other incentives have little effect. Properties with confirmed contamination sell at a 47% discount relative to comparable uncontaminated parcels, and participation tends to raise the property price, but this latter effect is not statistically significant. Taken together, these findings suggest that the participating properties are those with high development potential, and hint at the possibility that owners or developers may be seeking to obtain a clean bill of health from the State with only minimal or no cleanup efforts. Were these findings confirmed with data from other states, they would raise doubts about the effectiveness of voluntary programs in encouraging remediation and their usefulness in reversing some of the undesired effects of the Superfund legislation.Brownfields, Contaminated sites, Voluntary cleanup programs, Incentives

Assessing the Risk of Oil Spills in the Mediterranean: the Case of the Route from the Black Sea to Italy

Recent major spills on European coasts have highlighted the primary policy relevance for the EU of oil spills. This paper assesses the risks related to carrying oil to the EU along the route from the Russian Black Sea coast to Sicily, Italy (one of the most congested and strategically relevant European import routes). We develop a methodology based on Fault Tree Analysis, and we apply it to the most likely causes of an oil spill. We couple the resulting probabilities with data on expected spill size, types of oil carried and cleanup costs, to estimate expected costs for cleanup and loss of cargo. The route analysed appears to be a risky one; there is a “high” to “very high” risk of a spill along this route. The Turkish Straits turn out to be the major danger point; however, there is no obvious hierarchy amongst the other sites along the route.Oil spills, Cleanup costs, Risk analysis

Superiorfund - An Answer to State Court Holdings That Government-Mandated Cleanup Costs Constitute Damages under Comprehensive General Liability Policies

This comment analyzes the state high court decisions which seem to be reaching a consensus that the term damages in a Comprehensive General Liability policy encompasses the cost of cleaning up a hazardous waste site. In six state high court cases, the courts held in favor of the insureds, holding that cleanup costs constitute damages. In only three state high court cases, decided by two courts, the holdings were in favor of insurers with rulings that cleanup costs do not constitute damages. Two possible solutions to resolve the insurance carriers\u27 dilemma regarding the damages question are proposed in this comment. The preferred alternative is to amend the Comprehensive Environmental Response, Compensation, and Liability Act and make cleanup costs an uninsurable interest. With reimbursement of cleanup costs by insurers an impossibility, an alternative to insurance would be necessary. The author proposes a solution to the problem in the creation of a pollution fund to clean up hazardous waste sites. As a less desirable alternative, the author recommends that insurance carriers seek alternatives to litigation such as settling out of court

Land Use and Remedy Selection: Experience from the Field — The Fort Ord Site

In September of 1994, the Army closed the Fort Ord Military Reservation, a Superfund site of some 28,000 acres located in Monterey County, California. Under the Base Closure and Realignment Act, nearly all of this land will be transferred to federal and state entities and to a number of cities of the Monterey peninsula that border the base. A good deal of this property is valuable real estate — coastal dunes, golf courses, and barracks that can be converted to apartments or dormitories. For the beneficiaries of these property transfers the Fort Ord cleanup is a modern day gold rush that is taking place as part of a Superfund cleanup. What effect have economic development pressures had on the cleanup process and on decisions about cleanup standards? This case study addresses this question by examining: (i) how the legal requirements regulating cleanup, community involvement and reuse have been implemented by the Army and the U. S. Environmental Protection Agency; and (ii) the effectiveness of two groups created by legislation to integrate reuse planning and cleanup — the Fort Ord Reuse Authority, an economic planning authority representing the area’s local governments, and the Fort Ord Restoration Advisory Board, a citizens group mandated to advise the Army about the cleanup process.

Environmental Policy Since Earth Day I: What Do We Know About the Benefits and Costs?

Data on costs and benefits of the major environmental laws passed during the 1970s are reviewed. The winners in terms of benefit-cost analysis include: getting lead out of gasoline, controlling particulate air pollution, reducing the concentration of lead in drinking water, and the cleanup of hazardous waste sites with the lowest cost per cancer case avoided under Superfund. The losers include: mobile source air pollution control, water pollution control, and many of the regulations and cleanup decisions taken under the Federal Insecticide, Fungicide, and Rodenticide Act, the Toxic Substances Control Act, the Safe Drinking Water Act, and Superfund.Environmental Economics and Policy,

Identifying the Burdens and Opportunities for Tribes and Communities in Federal Facility Cleanup Activities: Environmental Remediation Technology Assessment Matrix For Tribal and Community Decision-Makers

The cleanup of this country's federal facilities can affect a wide range of tribal and community interests and concerns. The technologies now in use, or being proposed by the Department of Energy, Department of Defense and other federal agencies can affect tribal treaty protected fishing, hunting and other rights, affect air and water quality thereby requiring the tribe to bear the burden of increased environmental regulation. The International Institute for Indigenous Resource Management developed a tribal and community decision-maker's Environmental Remediation Technology Assessment Matrix that will permit tribes and communities to array technical information about environmental remediation technologies against a backdrop of tribal and community environmental, health and safety, cultural, religious, treaty and other concerns and interests. Ultimately, the matrix will allow tribes and communities to assess the impact of proposed technologies on the wide range of tribal and community interests and will promote more informed participation in federal facility cleanup activities

Liability for Past Environmental Contamination and Privatization

This paper examines the role of liability for past environmental contamination in the privatization processes of Central and Eastern Europe. The theoretical section establishes a link between a risk-averse investor's amount of information regarding the extent of past environmental contamination (and its cleanup costs) and the investor's willingness to pay for a particular enterprise, i.e., bid. As the investor obtains a more precise estimate of the uncertain cleanup costs, the investor faces less risk; therefore, the investor's risk premium falls and the investor's bid rises. This link generates four hypotheses regarding a privatization agency's responses to the investor's knowledge of cleanup costs. The empirical section of this paper proposes to test these hypotheses with forthcoming analysis using data from the Czech Republic.http://deepblue.lib.umich.edu/bitstream/2027.42/39686/3/wp302.pd