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Wisconsin Plant Recovery Initiative: Grant and Technical Services Opportunities Expand as Program Matures

Public Finance Law Update George J. Marek, Alexander J. Gore

In March 2010, the Wisconsin Department of Natural Resources ("DNR") launched an initiative to revitalize closed manufacturing plants. Called the Wisconsin Plant Recovery Initiative ("WPRI"), this initiative offers technical assistance as well as financial and liability tools for the clean up and eventual redevelopment of factories and other businesses that have shut their doors or are in the process of doing so. Please refer to Quarles & Brady's March 2010 Public Finance Update, "Wisconsin DNR Launches Industrial and Commercial Facilities Recovery Initiative: Benefits for Wisconsin Municipalities," for more information.

Six months into the program, certain technical assistance and financial grant aspects of WPRI are now fully in place and available to Wisconsin municipalities. These grants can help municipalities learn important information about the environmental condition of properties - information that is crucial in determining if and how to proceed with the redevelopment of historic industrial sites.

In particular, the WPRI Assessment Monies ("WAM") portion of the initiative is now fully operational. Under WAM, a total of $1 million is available to local governments and other eligible applicants to hire environmental consultants to investigate environmental contamination, including Phase I and/or Phase II site assessments, NR 716 site investigations and underground storage tank ("UST") removals.

WAM was awarded to the DNR by the U.S. Environmental Protection Agency ("EPA"). Ninety percent (90%) of the funds are to be used at sites with real or perceived hazardous substance contamination, with the remaining 10 percent available for sites with real or perceived petroleum contamination. A municipality does not need to own the Brownfield site but must have access to it.

There are two categories of WAM funding. The first addresses larger, more complex properties, and WAM awards will range between $50,000 to $200,000. Qualifying municipalities are eligible for these "Community Managed Funds."

A second category of the WAM funding initiative is for smaller, less complex sites. At such closed or closing plant sites, both qualifying municipalities as well as private businesses and/or developers are eligible to obtain "Contractor Services" awards. Upon granting a Contractor Services award, the DNR will hire an environmental consultant to conduct Phase I and/or Phase II environmental site assessments. The cost to conduct these environmental investigations are generally at least $15,000, with a maximum of $25,000. An appealing aspect of the Contractor Services awards is that the DNR handles all of the paperwork and pays the environmental consultant directly. The requirements for the municipality and/or the private business owner or developer are minimal: The applicants must insure that the current owner of the site has signed an access agreement authorizing the DNR and its environmental consultants to access the site to perform the environmental site assessments.

Statewide, DNR has signed contracts with three environmental consultants to conduct the Contractor Services awards environmental site assessments: AECOM, Short Elliot Hendrickson Inc. and The Sigma Group.

Recently, the City of Racine received the first grant award under the Contractor Services awards program to investigate a property located within a larger 50-acre manufacturing complex. Once the site assessment and cleanup work are completed at that site, the goal is to build a 30,000 to 40,000 square foot addition to an existing manufacturing facility, resulting in the addition of 50 jobs.

The DNR is actively seeking applicants for WAM Contractor Services awards.

Finally, the DNR has applied for an additional $1 million from the EPA in order to continue assisting municipalities and private entities to conduct environmental investigations through the WAM program. EPA will announce funding awards in early 2011.

Conclusion

In conclusion, the WPRI has matured; there are a number of technical and financial assistance opportunities for companies undergoing a plant closing as well as the municipalities in which such plants are located.

While the WPRI provides a helpful starting point for a number of Brownfield redevelopment issues, there are multiple legal responsibilities and practical considerations surrounding a plant closing and the redevelopment of a Brownfield site. To fully understand those obligations and opportunities, one must address technical, legal and business factors. If you have any questions, please contact George J. Marek of Quarles & Brady's Environmental Law Group at (414) 277-5537 / george.marek@quarles.com or Alex Gore of Quarles & Brady's Public Finance Group at (414) 277-5719 / alexander.gore@quarles.com.