Brownfields Tax Credits

Why Give Money Back?

Why does Massachusetts have a Brownfields Tax Credit program? Because ultimately jobs and housing are created when property is restored to productive use. The primary intent of the Brownfields Tax Credit is to incentivize real estate development of contaminated properties by offsetting costs, and “tip the scales” to make otherwise marginal projects go forward. The Massachusetts Brownfields Act was passed in 1998 to encourage and provide an incentive for the cleanup of contaminated sites, sometimes known as Brownfield sites. (EPA defines Brownfields as property where expansion, redevelopment, or reuse is complicated by real or perceived environmental contamination.) The programs put in place by the Brownfields Act offer both economic incentives and liability protections as a way to restore properties to productive use, which results in both economic development and a cleaner environment for our citizens.

Why is this Needed?

In Massachusetts, the hazardous waste law generically known as “Chapter 21E” makes the owner of a contaminated property liable or “guilty”. This liability applies even to an “innocent” owner who purchases a property that is already contaminated. In this way, the 21E law is a disincentive to purchase such a property, because the new owner has a potentially unlimited financial liability. This explains why many such properties (Brownfields) are underutilized and tough to sell – because of the cost, liabilities, and stigma. The Brownfields Act contains both liability protections and financial incentives. The Brownfields Tax Credit program has proven to be remarkably successful at meeting these objectives and rescuing many of these problem sites. Because of this program, many properties throughout the state have been cleaned and put back into productive use. Even better, program changes in 2006 greatly enhanced this tax credit program. By allowing the credits to be transferred or sold, now even not-for-profit organizations or taxpayers with limited tax liability can benefit from this program by selling their credits, resulting in cash. If your project meets the eligibility factors, we encourage you to take advantage of this incentive.

“Thanks to Cooperstown, we received almost double the amount of tax credits we had believed we were entitled to. All we had to do was show Cooperstown our records of cleanup costs, and they did the rest. Jim Curtis’ understanding of the Brownfields Tax Credit program is unparalleled. ”

- Dirk R.Casagrande, Trustee, Casagrande Family Real Estate Trust