By Mary Beth Dial

According to the United States Environmental Protection Agency, Brownfield sites are defined as “abandoned, idled, or under-used industrial and commercial facilities where expansion or redevelopment is complicated by real or perceived environmental contamination”. These abandoned sites are more than eyesores for communities; they can involve many environmental risks, contribute to lost tax revenue, and negatively impact communities.

Along with environmental hazards that can be associated with Brownfield sites, such as leaks in water and gas pipes, the values of properties around these sites are lowered, economic activity is decreased, and the sites can also become hosts for criminal activities. According to the United States Conference of Mayors, there are approximately 81,000 acres of Brownfield sites occupying 21,000 sites in 232 American cities.

 

Thomas F. Darden, chief executive officer of Cherokee Investment Partners, along with John Mazzarino, managing director, formed the company of Cherokee in 1993 with the purpose of concentrating on assets negatively affected by environmental hazards. The company is based in Raleigh, North Carolina and raises money from state pension funds, corporate trusts, and other institutional investors to buy Brownfield properties, clean them up, and then sell them to developers. Its mission is to “transform real estate liabilities into assets to advance global responsiveness to poverty and the environment” by using a “remediate, cultivate, collaborate” approach which is designed to assist in cleanup, educate leaders, and partner with and grant to similar organizations. In 1994, they developed an advisory affiliate to manage risks, and in 1996, Cherokee’s first fund was formed. Former funds have provided hundreds of millions of dollars to use for Cherokee’s efforts ($250 million in 1998, $620 million in 2002, and $1.2 billion in 2005). One of its main goals is providing investors with an annual return of more than twenty percent, and with the profits from selling the properties once cleaned, investors receive all of their invested funds back plus all of the profit up to a ten percent return. Within that ten percent, Cherokee keeps twenty percent and the rest is then also given to the investors. With this system in place, investors, communities, and the environment all receive great benefits from the redevelopment of Cherokee’s purchased Brownfield sites.

The amount of financial burden that these sites account for is devastating when compared to the potential tax growth and job creation possibilities in their redevelopment. If cleaned and repurposed, these sites could provide between $902 million and $2.4 billion in new tax revenue as well as create approximately 587,000 jobs.

Although many of these sites undoubtedly have positive potential, the process of  receiving federal funds to restore them from organizations such as the Economic Development Administration, is tedious and often times unsuccessful due to regulations and stipulations. Also, Superfund sites (highly contaminated former industrial areas) are eligible to be placed on the United States Environmental Protection Agency’s National Priority List; however, Brownfield sites are not.

The lack of federal support in cleaning up these Brownfield sites results in these hazardous areas continuing to impact communities.

Once Brownfield sites have been cleaned, their potential for use extends too many different amenities such as parks, schools, housing, and new businesses. Accompanying these new facilities can be job creations and training, economic stimulation and local spending, community pride, and beneficial tax revenue. The value of surrounding property also increases when the dangerous and unattractive Brownfield site is removed. Along with the added benefits, there is the elimination of environmental hazards associated with air, water, and hazardous waste. Also, the decrease in crimes, such as vandalism, arson, pollution, and drug marketing is also an extremely positive result from Brownfield cleanup. Overall, the benefits from repurposing Brownfield sites create cleaner and healthier communities. By utilizing the land that once was a Brownfield site, safer communities and rejuvenated social participation can be achieved.

Tony Duque, the Brownfield project manager at the North Carolina Division of Waste Management, thinks that “Cherokee is representative of what will be a growing trend”. Duque believes that education is the key to tackling harmful Brownfield sites and “we will see more of it”. Cherokee puts high priority in educating leaders, and the company’s vision is “a world with protected natural resources, sustainable production and consumption patterns, and no poverty”. Cherokee is currently hosting a contest called the Cherokee Challenge for teams pursuing their own environmental business, and the winner will receive $20,000 to assist in its start up. The deadline to apply was May 27, 2011, and the winning team will be announced on August 12. Cherokee strives to help make lasting impacts on environmental cleanup, and its core values to be reciprocated are stewardship, respect, love, courage, faith, and creativity. Cherokee continues to be successful in eliminating harmful Brownfield sites and supporting and encouraging others to do the same. Cherokee’s efforts provide inspiration to others who are passionate about eliminating these environmental hazards and promoting prosperous communities, which is significant since the responsibility to clean up these sites is majorly placed on communities and private organizations.


 

References:

  1. http://www.cherokeefund.com/pdfs/N&O_CapitalistsCleanUp.pdf
  2. Brownfield Redevelopment, U.S. Department of Commerce, Economic Development Administration (EDA)
  3. http://cherokeegivesback.org/about/
  4. http://www.cherokeefund.com/history.htm
  5. http://www.cherokeefund.com/
  6. http://www.epa.gov/
  7. http://www.cherokeechallenge.com/

For Further Reading:

  1. US Environmental Protection Agency
  2. http://www.cherokeefund.com/
  3. http://cherokeegivesback.org/
  4. http://www.cherokeechallenge.com/

Photo Credits:

  1. http://www.coj.net/ (Brownfield site)
  2. http://cherokeegivesback.org/ (Cherokee Logo)
  3. http://brentwood.thefuntimesguide.com/2007/07/new_brentwood_park_owlcreek.php (Playground)
  4. http://cherokeegivesback.org/cultivate/internships-mentored-studies/ (Clean Landscape)

 


 

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