The redevelopment of contaminated properties is vital to the economic growth and development of the nation’s urban and industrialized areas. For developers, the process of preparing a brownfield property for reuse can be expensive and complicated. As prime brownfield properties are redeveloped, developers are forced to turn to less desirable properties, usually those with higher levels of contamination and other regulatory hurdles. Over the past several years, federal and state lawmakers have recognized the difficulties facing developers of brownfield properties and have created numerous programs and policies, such as liability protections and financial incentives, to encourage redevelopment. In some instances, legislators and agency rulemakers have designed laws that create an unanticipated adverse effect on brownfield redevelopment.

When the U.S. Congress passed the Small Business Liability Relief and Brownfields Revitalization Act in 2001, legislators insisted that developers who receive financing from the Brownfields Cleanup Revolving Loan Fund for brownfield redevelopment projects should pay prevailing wages to project workers. While this provision advances the laudable goal of maintaining high wages, it also burdens developers of brownfields with significant additional costs if they want to take advantage of federal financial incentives. Based on our experience, the prevailing wage law typically increases labor costs by 20 to 25 percent. ...

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