City pioneers brownfield cleanup loan program
October 06, 2009
Eric McGuinness
The Hamilton Spectator
http://www.thespec.com/News/BreakingNews/article/648690
Hamilton plans a pioneering loan program to help redevelop former gas stations and other contaminated properties in the downtown and along the west harbourfront.
A pilot project expected to begin next spring will reimburse up to $100,000 in soil cleanup costs at an interest rate one per cent below prime. The money will be repaid out of ERASE brownfield redevelopment grants awarded after projects are complete.
City officials say landowners need help in advance, when banks are reluctant to get involved.
Ron Marini, director of downtown development, said staff came up with the idea after realizing the ERASE program works well, “but gives them (developers) money at the wrong end of the process.”
Glen Norton, senior business development consultant, told city councillors today that owners have to wait eight to 10 years for their ERASE money, and “some people can’t wait that long.” He said the new program is needed “if we want to get anything done.”
Planner Hazel Milsome said two parties are already interested in building condos on former service station sites that have been remediated sufficiently for commercial use. Each property requires an estimated $150,000 to $200,000 to bring them up to residential standards.
Councillor Lloyd Ferguson welcomed the attempt “to attract investment to the waterfront again,” but asked for assurance the loans would be secured to protect taxpayers from anything like the $1.1 million lost in the bankruptcy of a company that received a city loan to turn the old Spectator downtown printing plant into condominium apartments.
In the new program, Norton said, “We believe we will get, if not every penny, most of our money back,” but “we don’t want to layer on so much security we scare away the people we want.”
Milsome and Marini said they know of no other municipality with a similar program.
“No one’s done this before,” Marini told members of council’s economic development and planning committee.
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