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by Daniel Gloade on December 2, 2013

The City of Waterloo has a Brownfield Project.  An article about this program can be found here:  In essence, if you wish to develop property containing environmental contaminates then you can get a grant from the City of Waterloo and the Region.  The amount of the grant is based on the cost of the clean-up and the projected increase in tax revenue arising from the increased value of the now clean property.  The grant funds will be paid over time and the payments do not start until the development is complete.

The cost of the program can be up to $7.3 million.

This program seems overly complicated to me.  It is simpler if the buyer of the land pays the cost of cleaning the site.  The buyer can have the whole spectrum of methods to raise sufficient money to pay for the clean-up.  The buyer can either reduce the purchase price of the property, arrange for the seller to remove the contamination or raise more funds through the bank.

Also, this program allows polluters to use taxpayer’s funds to clean up the pollution.  The polluter should be penalized for the environmental damage done by a reduction in the value of the property.  This penalty should be incurred even if the land is owned by the City of Waterloo.

Finally, the program does not deal with costs directly.  First, if a business is receiving a grant to clean a site then there is less incentive for that business to find the most cost-effective company to clean the site.  Second, the payback schedule is based on projected increased revenue from the increased value of the property.  Assuming that the payout will likely continue long into the future, it is likely that the estimated value of future income will not accord to the actual value of the property.

If the City of Kitchener does not wish to wait for land to be sold, it can hire companies to clean the land directly.  The cost of the clean-up would be earmarked to the land’s owners or paid by the future land’s purchasers.

I welcome contrary thoughts and opinions, however.

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