Rabbino

Oregon,Brownfields,andtheNewLandBank
Authority
HowDoesItAllWork–AndWhyCi?es,
Coun?es,andPortsShouldBeInterested
PresentedbyDavidA.Rabbino,Esq.
TonkonTorpLLP
May16,2016
OregonBrownfieldConference,Sunriver,OR
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Agenda
Ø BrownfieldProperLesInOregon;
Ø WhatToolsExistToHelpRemediateBrownfields;
Ø HB2734-TheLandBankAuthorityBill;and,
Ø NewOpportuniLesUnderTheLandBankAuthority
Law.
Copyright2015TonkonTorpLLP
Whatisa“Brownfield”?
Ø Generally–AnyPropertyWithSomeEnvironmental
ContaminaLonThatImpedesDevelopment;
Ø PerORS285A.185:“realpropertywhereexpansionor
redevelopmentiscomplicatedbyactualorperceived
environmentalcontaminaLon”;
Ø CanBeAnythingFromAFormerDryCleanerSiteToA
LargeScaleIndustrialSeangSuchAsTheFormerBlue
HeronSiteInOregonCity.
Copyright2015TonkonTorpLLP
WhyAreBrownfieldsProblems?
Ø TheyPresentAPotenLalHealthHazardToThePeople
WhoLiveNearby;
Ø TheyImpairTheValueOfSurroundingProperLes,
ReducingPropertyTaxRevenues;
Ø TheyContributeToGeneralBlightCondiLons;
Ø TheyCanResultIn“DeadAreas"InWhatCould
OtherwiseBeVibrantNeighborhoods.
Copyright2015TonkonTorpLLP
AreThereBrownfieldProperLesinOregon?
Ø TheyExistStatewide;
Ø ThereAreApproximately13,500Throughoutthe
State;
Ø TheyExistInBothUrbanandRuralSeangs;
Ø ExtentOfCleanupRequiredWillVary.
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ImpedimentsToBrownfieldRedevelopment
Ø ManyBrownfieldsOwnersHaveNeitherTheWillNor
MeansToCleanUpOrRedevelopTheProperty;
Ø PrivateDevelopersAreReluctantToAcquire
BrownfieldsDueToUnknownExtentOfLiabilityAnd
CostsToCleanUpTheProperLes;
Ø EnvironmentalLawsProvideLimitedWaysForLocal
GovernmentsToAcquireBrownfieldsWithoutBeing
SubjectToEnvironmentalLiabilityAsAn“Owner.”
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WhatToolsExistToHelpRemediateBrownfields?
Ø ToolsAreBothPublicAndPrivate;
Ø ThereAreEPA/StateGrants;
Ø ThereIsContribuLonLiLgaLon;and,
Ø ThereAreProspecLvePurchaserAgreements
(“PPAs”).
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WhatToolsExistToHelpRemediateBrownfields?
Ø NewToolNowExists–the“LandBankAuthority”;
Ø NewLegislaLonPassedJune2015;
Ø AuthorizesLocalGovernmentsToCreateSeparate
LandBankAuthoriLesToAcquireAndRedevelop
Land;
Ø EffecLveJanuary1,2016.
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HB2734-TheLandBankAuthorityBill
Ø HB2734,WasEnactedToEnableLocalGovernmentTo
"createanauthorityforthepurposeofacquiring,
rehabilitaLng,redeveloping,reuLlizing,orrestoring
brownfieldproperLesthatarelocatedwithinthe
geographicboundariesoverwhichthelocal
governmenthasjurisdicLon“;
Ø OnceEstablished,ALandBankAuthorityHas"all
powersnecessarytoaccomplishthepurposesof
acquiring,rehabilitaLng,redeveloping,reuLlizingor
restoringbrownfieldproperLes."
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HowDoesTheLandBankAuthorityWork?
Ø  LandBankAuthoriLesAreCreatedByResoluLon/
OrdinanceOfTheLocalGovernment;
Ø  OnceEstablished,TheLandBankAuthorityIsManaged
AndControlledByABoardofDirectors,TheComposiLon
OfWhichIsMadeUpOfIndividualsFromTheLocal
GovernmentAndLocalCommunity;
Ø  ALandBankAuthorityMayAlsoEstablishAnAdvisory
CommikeeToProvideGuidanceOn"theinterestsofthe
communityintheacLonsoftheboardandtheauthority."
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HowDoesTheLandBankAuthorityWork?
Ø OnceSetUp,AnLBAIsA“MunicipalCorporaLon”
UnderOregonlaw;
Ø SubjectToAllPublicRecordsRequirements;
Ø MustGivePublicNoLceOfProposedDisposiLonsOf
Land;and,
Ø PrepareAnAnnualReportToTheGovernor.
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ThePowersOfALandBankAuthority
Ø LandBankAuthori?esHaveExtensiveAuthority:
Ø LBACanBuyAndSellProperLes,LeaseProperLes,
AcceptPropertyByGil,IssueBonds,AndTakeOn
DebtToAcquireProperLes;
Ø LBACanIniLateCleanupAcLviLesAtBrownfield
ProperLesAndSeekToRecoverCleanupCostsFrom
TheParLesThatActuallyContaminatedThe
ProperLes;
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ThePowersOfALandBankAuthority
Ø  LBACanDevelopPrioriLesForTheUseOfThePropertyIt
Acquires(e.g.,Industrial,ResidenLal,Mixed-Use,Low
IncomeHousing,AndOpenSpace);
Ø  LBACanAcquireBrownfieldsWithAnEyeToward
AggregaLngTheProperLesIntoMoreDevelopable
Parcels;
Ø  LBACanServeAs“PaLentCapital"—Acquiring
BrownfieldsAndHoldingThemUnLlTheRight
DevelopmentOpportunityArises.
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LiabilityProtecLonsGivenToAnLBA
Ø HB2734ReducesLiabilityRisksForLocalGovernments
AndForTheLandBankAuthorityItself;
Ø LBAIsASeparateLegalEnLty-LBA’sAcLonsAreNot
AkributableToTheLocalGovernmentThatCreatesIt;
Ø LBAsAreExemptFromBothPropertyTaxAndState
IncomeTaxOnTheirAssetsWhileTheyOwnThem.
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LiabilityProtecLonsGivenToAnLBA
Ø LBADoesNotAcquire“Owner"LiabilityUnderExisLng
StateCleanupLawsSimplyAsAResultOfAcquiringA
Brownfield;
Ø TheLocalGovernmentIsNOTLiableForTheLand
BankAuthorityDebts–UnlessItExpresslyAgreesTo
Be.
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PossibleFundingMechanisms:
CapitalizaLon
Ø Generalfundalloca?on(s)-FlexibleSource;
AllocaLonsCanBeMadeOverMulLpleYearsToBuild
Corpus,ButRequiresFurtherPoliLcalApproval;
Ø GeneralObliga?on(GO)Bond-FlexibleSourceWith
SignificantFinancialCapacity,ButRequiresPublic
Vote;
Ø RevenueBonds-RequiresDedicaLonOfARevenue
StreamForDebtRepayment;and,
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PossibleFundingMechanisms:
CapitalizaLon
Ø SDCsorLinkageFeesOnNewDevelopment-
DependentOnNewDevelopmentAndTherefore
Cyclical;RequiresLegalAnalysis;
Ø UrbanRenewal-StrongNexusBetweenFundPurpose
AndLBAAcLons,MayRequirePlanAmendmentsTo
OvercomePossibleLimitaLonsonUR$$Use;
Ø Public/PrivatePartnership–JointVentureBetween
LBAandPrivateDeveloper.
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NewOpportuniLesUnderLandBank
AuthorityBill
Ø OpportunityToAcquirePropertyForDevelopment;
Ø OpportunityToParLcipateInPublic/Private
PartnershipWithPrivateDevelopers;
Ø OpportunityForCollaboraLveDevelopmentWith
Community.
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NewOpportuniLesUnderLandBank
AuthorityBill
Ø OpportunityToAcquireBrownfieldPropertyWithout
LiabilityForExisLngContaminaLon;
Ø OpportunityToPerformRemediaLon/ConstrucLonOn
LBA-ownedProperty;
Ø OpportunityToSeekRecoveryOfRemediaLonCosts.
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Conclusion
Ø  BrownfieldProperLesExistinOregon–TheyAre
OpportuniLes,NotNecessarilyLiabiliLes;
Ø  TheLiabilityProtecLonAndTaxExempLonProvisionsOf
HB2734RemoveMuchOfTheFinancialRiskAndLegal
UncertaintyPreviouslyAssociatedWithALocal
Government'sAcquisiLonOfContaminatedProperty;
Ø  LandBankAuthoriLesPromoteLocalControl;
Ø  CiLes,CounLes,andPortsThatMoveFirstWillBenefitThe
Most.
Copyright2015TonkonTorpLLP