'Brownfield' companies get tax break without proof of pollution [Orlando Sentinel]By Sandra Pedicini, Orlando SentinelMcClatchy-Tribune Information Services
Aug. 19--A state program created to redevelop polluted areas is doling out tax breaks for companies that lease offices in downtown high-rises, build on pastureland and open restaurants on busy highways, even when there is no proof they are on contaminated land.
From January 2011 through April 2012 alone, about $11 million in tax refunds have been approved for dozens of businesses, according to a database accidentally released in June by the state Department of Economic Opportunity. In some instances local governments would not contribute their share, which means the overall total could be lower.
The companies range from Orlando startup video-game developer Row Sham Bow to Fortune 500 corporations including Darden Restaurants and Publix Super Markets.
Many businesses can receive up to $2,500 per job during several years when they open or expand in so-called "brownfields," defined as properties underdeveloped because of actual or perceived environmental pollution.
Companies are getting the breaks largely because Florida's brownfield initiative has a major loophole, critics say. To be eligible, there is no need to prove that anything needs cleaning up. The perception alone of contamination is enough under the vaguely written law.
"Cities and counties are broadly designating areas in a desperate attempt to attract businesses and investors to their area, with lands qualified for more government handouts from taxpayers," said Dan Krassner, executive director of Integrity Florida, a watchdog group that tracks state incentives.
One of the original sponsors of the law says much of its use appears to go beyond legislators' intent. And an attorney who helps companies take advantage of the law concedes it needs revisions.
The program has, in fact, improved some polluted areas. Businesses sign separate agreements to clean up contamination for other tax credits.
However, local governments in Florida have designated 226,962 acres as brownfield areas so far, and cleanup agreements are in place for just 3,642 acres.
In Central Florida, brownfields take up many west Orlando neighborhoods and all of downtown Orlando. They include downtown areas in Sanford, Kissimmee and Mount Dora, and long stretches of U.S. Highway 17-92 in Seminole County. They also encompass more than 1,000 acres in Winter Springs, including its decade-old town center and undeveloped tracts near State Road 417.
Former state Rep. Lee Constantine, who sponsored legislation establishing the brownfield program in 1997, said some of its recent use "doesn't sound like the pure definition we envisioned."
Constantine said the intent was to encourage development in "areas that were the most degraded ... inner cities, areas that were used as dumps, other things like that."
Supporters say the brownfield program has cleaned up pollution, revitalized depressed communities and prevented sprawl by encouraging infill development.
But attorney Michael Goldstein, an advocate of the program who helps companies such as Darden andWal-MartStores tap its incentives, said language establishing it is vague. Goldstein said his clients use the program legitimately, but some communities have designated areas too broadly.
He plans to ask legislators to tweak the program, including requiring companies who want land deemed a brownfield to prove they have valid contamination fears. Otherwise, he said, there is "the potential to consume limited resources too quickly and inequitably in a way that's going to make the Legislature reconsider the entire program."
Last year, startup video-game maker Row Sham Bow was approved for $150,000 in brownfield credits for moving into The Plaza downtown.
"I was unaware of exactly why that particular block was designated a brownfield. I just knew that it was," said Philip Holt, Row Sham Bow's chief executive officer. "We wanted to be aware of whatever incentives were available for the various addresses we were looking at."
In fact, all of downtown has been designated a brownfield. Some areas have had contamination, but city officials were largely concerned with economic development.
A city spokeswoman said Orlando doesn't know whether individual properties are polluted. Florida's Department of Environmental Protection said on many of the downtown sites where companies have received incentives, there are no cleanup agreements and it has no records showing contamination.
City economic-development director Brooke Bonnett would not comment on why properties such as The Plaza, which is 5 years old, would be considered to have a perception of contamination.
"So long as the state statute allows for the program to operate in the way that it does, our job is to make our city as competitive as we can make it on an economic-development front," she said.
Krassner questioned why someone would get brownfield funds for leasing space in buildings years after they're constructed.
"Without any environmental improvement," he said, "why are we giving taxpayers' money away?"
Cow pasture for Publix
Earlier this year, Orlando designated more than 100 acres of pastureland near Orlando International Airport as a brownfield. Lakeland-based Publix, which has owned the property since 2009, plans a distribution center there. It will get $390,000.
Orlando said a brownfield designation on agricultural land makes sense because it could have pesticide contamination. But Publix spokeswoman Maria Brous said last year that "the brownfields designation has nothing to do with potential contamination, but rather with job creation." She also said there is no cleanup going on.
The project should create 156 jobs during three years.
Olive Gardens, LongHorns
Orlando-based Darden received approval last year for $620,000 in brownfield breaks for three Olive Gardens and two LongHorn Steakhouses in Lake City and Miami-Dade County.
Company spokesman Mike Bernstein said in an email that businesses such as Darden are helping "eliminate sites that, through actual or perceived contamination, create a spiral of blight and disinvestment."
Darden doesn't think anything needs cleaning up, but it had to do more work than usual on the properties, Bernstein said. He did not elaborate.
One Miami-Dade site, in Hialeah, is a former car dealership where there was previously petroleum found in groundwater. Officials said recent tests have come back clean.
Another property in Cutler Bay is just outside a mall.
Officials in Cutler Bay and the North Florida town of Lake City say they don't know of any contamination on Darden's properties.
In Lake City, officials designated an old motel where Darden will build two restaurants as a brownfield, at the company's request.
City Manager Wendell Johnson said a new Olive Garden and LongHorn will be a boon. But "it's not really a blighted property," he said. "It's within an area very conducive to new development."
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Who got breaks
Companies awarded some of the brownfield program's largest breaks:
Darden Restaurants: $620,000 in 2011 for five restaurants in North Florida and Miami-Dade.
Publix Super Markets: $390,000 this year to build a distribution center on pastureland.
BBA US Holdings: $250,000 this year for a headquarters expansion in Seaside Plaza in downtown Orlando.
Teledyne Industries: $250,000 in 2011 for an expansion in Daytona Beach.
iGPS Orlando: $187,500 in 2010 for expanding its headquarters, which moved to Landmark Center Two in downtown Orlando.
Row Sham Bow: $150,000 in 2011 for establishing its headquarters in downtown Orlando's The Plaza.
Evolution Auto Sales: $100,000 this year for opening in the old David Maus Toyota on U.S. Highway 17-92, Longwood.
SOURCE: Florida Department of Economic Opportunity
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