Illinois Business Journal - Private brownfields developers unaware of 3-year-old, $3 million grant program

A total of $3 million in state grant dollars still sits waiting to be used by private, nonmunicipal brownfields developers; since the program was converted from a loans-only initiative in 2001, not a single developer has applied for any portion of the money, according to Illinois Environmental Protection Agency Director Renee Cipriano.

Created via an amendment to the Illinois Environmental Protection Act, Section 58-15b, the Brownfields Site Restoration Program offers private developers a chance to apply directly to the state for up to $750,000 per site in state grant money, without having to go through the municipality in which the site is located.

In Illinois' budget deficit environment, the information that this money is still available statewide comes as good news to developers across Southwestern Illinois. But the fact that the grant program has had no takers in nearly three years, several area developers say, is because they knew nothing about it.

"It's great to know there is a state grant program available to the private sector," said Karl Ruhmann, director of environmental services for SCI Engineering Inc. "When it comes to a deal happening, time is crucial. The fact that the state of Illinois is offering developers the opportunity to apply directly to the state for funding, rather than needing to allow extra time to apply through the municipality, is welcome news. I had no idea such a program existed."

Matt Robinson, senior vice president for Environmental Operations Inc., is aware of the state grant program because he helped create it, supporting legislation back in 2001 that converted $3 million of the total available municipal loan program monies into grant dollars.

"It's true that the state of Illinois just hasn't advertised this grant program," he said. "The IEPA has kept this card pretty close to its chest for some reason. But it is important to see the program utilized. There are even provisions in the legislation to prevent it from being used on projects in the Chicago area."

Robinson said his firm has not applied for any of the grant dollars, but that EOI has successfully applied for monies through the state's parallel program, the Brownfields Redevelopment Loan Program. In this separate program, municipalities can team with private sector developers to apply for up to $240,000 in loans to cover costs of environmental assessment and, as of 2003, actual cleanup of a brownfields site.

"If nothing else, it's significant that there's still grant money in place," Robinson said. "Even if it's awarded to projects in areas other than Southwestern Illinois, this program needs to have some successes so money will be added to it every year and it will continue to exist."

The private grant program's initial wording called for dollars to be added each fiscal year, above the initial $3 million appropriation. Cipriano said the program still exists at $3 million.

Robinson and others said one reason the grant program may have had no applicants since it was created points to the lack of organization and coordination between the IEPA and the Department of Commerce and Economic Opportunity, the two state agencies charged with jointly administering it. The program calls for developers to secure an application from DCEO and get certified, and after working the site - with a "No Further Action" letter from DCEO in hand - return to the IEPA for reimbursement of up to $750,000.

"The process is cumbersome," he said.

Cipriano said both the IEPA and DCEO are in the process of reviewing the Brownfields Site Restoration Program, making sure that the application process is doable for developers.

"Back in 2001, when we worked to convert some of these loan dollars to grant dollars, developers were telling us that the state loan programs and tax credit remediation programs (Illinois Tax Credit Act) were not attractive to them because there were too many hoops to jump though," she said. "In revamping the programs, we wanted to work with what was then DCCA (Department of Commerce and Community Affairs, now known as DCEO) to also create an economic benefit. We thought this would be a good way to set up the new private sector brownfields grant program, but it has been in place since 2001 and has not yet been used.

"And now, one of the governor's (Gov. Rod Blagojevich) top priorities is his Opportunity Returns initiative, and brownfields redevelopment is a very important aspect of that. We've started to look at this program and make whatever adjustments are necessary to make it viable. The $3 million is still in place. It's first-come, first-served."

Cipriano said to her knowledge no formal marketing efforts have been made, either on DCCA, DCEO or IEPA's part, to tout the program's existence to its potential applicants.

The emergence of several U.S. EPA federal brownfields programs during 2002 may have created confusion in the minds of developers seeking funding, she said.

Phil Roggio, director of development and housing for the city of Alton, said he was not aware of the private developer grant money from the state, despite direct discussions with the IEPA last summer about what funding was available to assist Alton Steel in its remediation efforts.

"We'd be thrilled to work with Alton Steel in applying for that grant funding," Roggio said. "We reapplied in December for $350,000 in U.S. EPA money for site assessment on Alton Steel's behalf, for $200,000 in federal dollars that could go toward cleanup and remediation and for a $1 million revolving loan fund, but state grant dollars would definitely be put to good use, too."

Despite several attempts to procure an application to the Brownfields Site Restoration Program, the Illinois Business Journal was not successful. Interested applicants, Cipriano said, are encouraged to first contact their Opportunity Returns regional director; for the Southwest Region, that is Edie Koch, (618) 346-3818. Cipriano said applicants are also welcome to contact her office, (217) 785-1871.