House Bill 2734 would address brownfield remediation in two key ways – by allowing local governments to create limited liability organizations, called "land banks," that could take on cleanup; and by offering limited property tax cuts to property owners that clean up brownfields.
Those brownfields are plentiful – more than 5,000 of them across Oregon, said Seth Otto, an analyst at Maul Foster Alongi. In the Portland region, officials have identified more than 2,000 sites.
They range from shuttered gas stations to long-departed dry cleaners to bankrupt factories, places where, over time, hazardous chemicals leaked into the ground.
Without remediation – cleaning the toxins that leaked into the soil over the years – these sites often sit idle, too expensive to clean and thus impossible to redevelop.
Speaking in favor of the bill at a Tuesday hearing of the Oregon Rural Communities, Land Use and Water Committee was Rep. Lew Frederick, D-Portland, who talked about a contaminated site in his neighborhood.
It was once home to an auto shop that he'd take his bright green, blue and yellow Volkswagen – "a major hippie bus," Frederick said.
"The mechanic came out of the back of the shop with a bucket of solvent and poured it on the ground," Frederick recalled. "I said, 'You can't do that,' and he said 'I've been doing it for years, I don't know what you're talking about.' That's the kind of contamination that takes place."
The brownfield at the site has since been remediated, Frederick said.
"It has been cleaned up and is going to be developed shortly," Frederick said. "I'm not necessarily keen on the development they're putting in there, but it's being developed on something I saw actually be contaminated."
There are 147 such sites in Frederick's district alone.
Brownfield remediation isn't as simple as sucking toxins from the ground with a big vacuum. Contaminated soil often has to be excavated – and moved to a place where it won't further contaminate the soil.
State and federal regulations require property owners to clean up the land, but if the owner of a contaminated site goes bankrupt, there's no entity to assume the liability. That can mean brownfields sitting vacant or underutilized for years, even decades.
"I have a lot of brownfields in my district that have food carts," Frederick said. "I like food carts, but I'd much prefer to have a small manufacturing plant or something else on that site."
The costs for cleanup of a gas station can go into the hundreds of thousands of dollars. But for communities, the costs can go even further.
"In addition to being eyesores and public health hazards, brownfields represent a lost economic opportunity," Otto said.
A 2014 evaluation of Oregon brownfield remediation showed that every $1 spent by the state on cleanup prompted $116 in private-sector spending.
In the bill's proposed land bank system, Oregon cities could work with other groups – counties, nonprofits, even school districts – to create a "land bank district." That district could buy contaminated properties and clean them up, or work with other organizations to get them remediated.
The advantage of the land bank district system, said Tonkon Torp lawyer David Rabbino, is that it would protect local governments from liability.
In the current system, a city that went in alone to clean a brownfield could ultimately be liable for any future contamination. That would expose the city's general fund revenue to damages, discouraging cities from getting deeply involved in brownfield cleanup.
The bill would limit the liability of the "land bank authority," shielding city governments from lawsuits. And even if the land bank authority were liable, bill proponents say, its assets would be limited to the contaminated land it owns – not tax money that's supposed to go to streets, parks and police.
"The land bank can acquire property, sell the property, they can lease it, develop it. They can do pretty much what anyone else can do, but they're the entity responsible, not the city that sets it up," Rabbino said. "There is a liability wall that gets set up both from the city, and this legislation would insulate the land bank itself from liability."
If the Legislature authorized property tax abatement on brownfields, local governments could curb the taxes on a contaminated property for a number of years after cleanup. That portion of the bill still hasn't been drafted yet.
About 10 people testified at Tuesday's hearing, all in favor of the proposed bill.
Brian Harper, a Metro planner who's studied brownfields, said none of the proposals, on their own, will solve the brownfields problem.
"Together as a suite, used effectively with a lot of other tools we have – like urban renewal and the state's brownfield cleanup program – you can put these things together and address brownfield cleanup," Harper said. "You need a lot of tools to do it. No one tool can get it done."