THE EFFECTS OF ENVIRONMENTAL HAZARDS 
           AND REGULATION ON URBAN REDEVELOPMENT 
                            August 1997 
                       Submitted by Researchers From: 
                            Urban Institute 
                         Northeast-Midwest Institute 
                          University of Louisville 
                        University of Northern Kentucky 
                            Submitted to: 
                      U.S. Department of Urban Development 
                     Office of Policy Development and Research 
                      U.S. Environmental Protection Agency 
                            Office of Policy 
                         UI Project No.; 06542-003-00 
            THE EFFECTS OF ENVIRONMENTAL HAZARDS 
          AND REGULATION ON URBAN REDEVELOPMENT 
                          August 1997 
           The Department is now actively participating in the Administration’s initiative to help 
       communities clean up and sustainably redevelop brownfields.  The Department is taking a series 
       of programmatic steps to be responsive to this high priority of concern of State and local elected 
       officials.  This includes new Economic Development Initiative funds to specifically address 
       brownfields redevelopment needs, provide technical assistance to State and local governments, and 
       streamline community development regulations to make them more friendly to brownfields 
       redevelopment. 
           A key part of the Department’s efforts is an active brownfields research program.  The Office 
       of Policy Development and Research is implementing an aggressive research agenda in support 
       of the Department’s programmatic efforts.  The purpose of our brownfields research and 
       development program is to better understand how brownfields are impediments to revitalization of 
       America’s  distressed communities, and to develop ways to overcome and eliminate those 
       impediments. 
           Our ongoing research is examining a range of issues: how the intertwined issues of 
       environmental risk and neighborhood economic distress affect the redevelopment process; how the 
       Community Development Block Grant program supports local brownfields revitalization efforts; the 
       feasibility of using environmental insurance as a tool to spur economic redevelopment; and 
       innovative approaches for financing brownfields clean up and development activities. 
           This report, jointly sponsored by HUD and EPA, provides insight into some of the most basic 
       issues confronting brownfields policy: the relative importance of environmental risk versus 
       neighborhood economic distress as deterrents to the neighborhood development.  The report 
       addresses the significance of: 1) site contamination as a deterrent to brownfield redevelopment, as 
       compared to other factors retarding reuse; 2) which environmental development cost or uncertainty 
       most deters investments in redevelopment; and 3) which types of State brownfield clean up policies 
       and programs are likely to be conducive to investments and redevelopment.  This report sharpens 
       the focus on what the real policy issues are and what are appropriate policy options for addressing 
       these issues. 
                                  Paul A. Leonard 
                                  Deputy Assistant Secretary for 
                                   Policy Development 
           The Effects of Environmental Hazards and Regulation on Urban Redevelopment 
                           Acknowledgments 
           This report was drafted by Christopher Walker and Patrick Boxall of the Urban Institute, 
        Charles Bartsch and Elizabeth Collaton of the Northeast-Midwest Institute, Peter Meyer of the 
        University of Louisville, and Kristen Yount of Northern Kentucky University.  We thank Ken Chilton, 
        Jason Greenberg of the U. of Louisville, Maris Mikelsons of the Urban Institute, Brandon Roberts, 
        and Robert Schneider of Public Policy Associates for their help in data collection.  We acknowledge 
        the patient guidance of Edwin Stromberg of the Department of Housing and Urban Development 
        and  the advice and assistance of Ludmyrna Lopez, Linda Garczynsky and Ben Hamm of the U.S. 
        Environmental Protection Agency.  We also thank the numerous developers, lenders, State and 
        local officials, and others who took their valuable time to speak with us.  Mistakes and conclusions 
        are those of the authors, and not their respective institutions.