The International Information Center for Geotechnical Engineers

The Impacts of Brownfield Redevelopment Both Economically and Socially - Role of Liability, Regulation, and Economic Incentives

ECONOMIC IMPACT OF REDEVELOPMENT

On the surface Brownfield Redevelopment funding looks to be the subsidization of private-for-profit entities through taxpayer dollars. There are many reason where this public-private partnership serves the public good.

Most immediately, helping private developers recycle brownfields brings land back into the local tax base. This increases the money available for local government services such as schools, roads, and fire departments. It also increases the value of surrounding land parcels. One EPA study saw an increase in residential property values of 5.1% to 12.8% after a nearby brownfield was assessed or cleaned up (EPA 2014). By repurposing this land, it makes the area more appealing, which increases the land value and thus the tax rate.

For this same reason, if brownfields are converted to public lands such as parks or other community spaces, the redevelopment indirectly increases tax revenue by increasing surrounding property values (DeSousa 2009). Even if the investment by local governments is not partnered with private entities, the redevelopment can help provide a space that fosters community, which increases the perceived value of properties in that community (Kotoval 2016).

Beyond the positive economic impacts that redeveloping these brownfields would have, companies also have an inherent incentive based on Detroit’s location. Detroit has the only deep water international port in Michigan. The Ambassador Bridge is also located in Detroit, and is known as the ‘number 1 international border crossing’ in the US due to the volume of imports and exports that cross it each year. This gives companies incentive beyond what a public partnership offers, a robust infrastructure already in place and an access to international trade.

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