Before the Court: EPA admits that it has failed to meet its nondiscretionary obligations to implement the Landfill Emissions Guidelines, as compelled by the CAA. The only questions before the Court were whether the Plaintiffs have standing and, if so, how long to give EPA to comply with its overdue nondiscretionary duties under the Landfill Emissions Guidelines. The Plaintiffs are the States of Illinois, Maryland, New Mexico, Oregon, Rhode Island, California, Vermont, and the Commonwealth of Pennsylvania.
Ruling: Plaintiffs have standing, and the EPA must approve existing submitted plans by September 6 and issue the federal plan by November 6.
Impact on Landfill Owners/Operators: This will create some confusion, as landfills will be working on getting revised rules in place while at the same time start complying with the old EG rule. We are already doing that with XXX sites, but this ruling adds complexity. If EPA keeps to the schedule and we have final approved revised rules by March 2020, landfills won’t have to do as much under the old rules before new ones take effect.
Contact your SCS Project Manager for more information, email us at , or follow SCS on your preferred social media.
On May 1, 2019, the Department of Treasury published in the Federal Register its second set of proposed guidance related to the new Opportunity Zone tax incentive created by the 2017 Tax Cuts and Jobs Act. Opportunity Zones are communities where new investments may be eligible for significant tax incentives. The incentive is designed to spur economic development and job creation. Secretary Steven T. Mnuchin said, “We are pleased to issue guidance that provides greater flexibility for communities and investors as we continue to encourage investment and development in Opportunity Zones…This incentive will foster economic revitalization, create jobs and spur economic growth that will move these communities forward and create a brighter future.”
The second set of guidance defines the meaning of “substantially all” where at least 70 percent of the tangible property owned or leased by a trade or business is qualified opportunity zone (QOZ) business property and similarly, that “use” is satisfied if at least 70 percent of the property is located within a QOZ. The guidance also clarifies that sales or dispositions of assets by a Qualified Opportunity Fund (QOF) do not impact in any way investors’ holding periods in their qualifying investments or trigger the inclusion of any deferred gain reflected in such qualifying investments so long as they do not sell or otherwise dispose of their qualifying investment for purposes of section 1400Z-2(b). According to the guidance, a QOF has 12 months from the time of the sale or disposition or the return of capital to reinvest the proceeds in other QOZ property before the proceeds would not be considered QOZ property with regards to the 90-percent asset test.
As many of the Opportunity Zones will be designated in areas containing Brownfields redevelopment opportunities, SCS expects many of our clients will be interested in this opportunity to do well by doing good. If you are interested in investing in a potential brownfield site, contact SCS Engineers to help you evaluate and manage environmental concerns associated with your site. Visit www.scsengineers.com to learn more.
The following are links to the press release and second set of proposed guidance:
U.S. Department of Treasury Press Release
Proposed Rule by the Internal Revenue Service on 05/01/2019
Within a few months, the Department of Treasury and the IRS expect to address the administrative rules that would apply to a QOF that does not maintain the required 90 percent investment standard as well as information-reporting requirements. SCS will provide an update when this information becomes available.
Next year… 2020 will be the 30th year of SCS Engineers keeping roads in Madison, WI. clean.
A USDA study finds 21 percent of food purchased in the U.S. goes uneaten.
In the United States, 31 percent—or 133 billion pounds—of the 430 billion pounds of the available food supply at the retail and consumer levels in 2010 went uneaten. Retail-level losses represented 10 percent (43 billion pounds) and consumer-level losses 21 percent (90 billion pounds) of the available food supply.
“We’re excited to have SCS Engineers design a food waste prevention program that the individual cities will be able to bring to our residents,” said Lori Topley, Solid Waste Program Manager for the City of Mountain View. “Reducing food waste was recently identified by Project Drawdown (drawdown.org) as one of the top five solutions to reverse global warming.”
Christina Finizio, a recent graduate from the University of Florida now holds a Bachelor of Science in Environmental Engineering. Her journey with SCS began last summer when she joined the Boca Raton team as an Intern. Christina did not always know she would become an engineer, she thought she would study International Business just like her sister, but that quickly changed.
In high school, she attended a Hackathon event that took place in San Francisco, and that is when her interest in engineering began. In this event, she got a glimpse of computer science and other areas; her instincts kept drawing her to engineering. She looked at her options, and many did not seem appealing to her until she looked into environmental engineering. It ultimately made sense to go that route; she always had an interest in the environment and was the President of the Environmental Club in high school.
While in college, she participated in an exchange program and flew out to Madrid for the spring semester. Her experience was unforgettable. During this time, she made friends from all over Europe and the world, improved her Spanish and explored the world of tapas. While there, she took care of business and had an internship with Sacyr’s (Valoriza Servicios Medioambientales), a construction firm, where she joined their Environmental Engineering group. Her internship focused on environmental and solid waste. This was the first time she was exposed to the solid waste industry, and where her interest grew.
After completing her exchange and internship program, she arrived home with a clear idea and knowledge of what she wanted to do next. She did her research and found a well-known professor who teaches and researches in solid waste at her university. She took his classes and studied with his group so she could become more knowledgeable.
Christina is was involved on campus and joined many student organizations. At one of the Society of Women Engineers’ (SWE) event, she met SCS’s Director of Talent Acquisition, Jennifer McCafferty. Christina was interested in SCS’s work and kept in touch with Jennifer. The following summer she applied to SCS’s internship program and was offered an internship in the Boca Raton, Florida office. She enjoyed the experience because it focused on solid waste management her primary area of interest.
Shortly after graduating, Christina joined the SCS team as an Associate Professional at the Tampa, Florida office. She loves the culture, and enjoys working with her team; they are exceptionally friendly and are always willing to lend a hand. She feels her success is in part, due to her team’s focus on their clients’ needs and believes this focus and the team’s communication style is valuable to clients, her team and herself.
Every day her work is different; she can be out in the field one day and in the office the other. She works on a variety of reports such as annual air monitoring and greenhouse gas reports; performs construction oversite for gas systems and system expansions. Her internship and new responsibilities give her a deeper understanding of the solid waste business, and how landfill gas can become a renewable energy resource rather than an environmental impact.
One of her biggest challenges is being able to imagine or see what is going on in the landfill. Landfills are complex requiring environmental monitoring and multiple systems for continuous protection; no doubt that Christina will continue to learn from the best in the business and continue to excel as an Associate Profesional.
Her advice to new interns is to always ask for help when you need it and offer support to those around you. You will be surprised how much you will learn from different areas and how friendly and willing to mentor everyone is. She feels this mantra was what prepared her for her current position.
Fun facts you should know about Christina; that she loves to salsa dance, cook, and travel. She is the first one in her immediate family to hold a degree in engineering and the STEM field. Christina is a valuable member of the SCS Tampa office team and the firm.
SCS Engineers is fortunate to include Christina and our many other Young Professionals at SCS on our teams.
The days of laying out ground control points and spending hours in front of a computer processing data have come and gone. Phil Carrillo of SCS Engineers and others discuss how to get a drone program started that will add real value to your landfill operations, and provide a good return on investment.
In addition to the expert tips, the article provides links to information and resources important to planning a program. Here are a few tips from the experts:
Still sound daunting? It’s not for the professionals at SCS Engineers. Read the article on our website; we encourage sharing it with others too.
More landfill technology resources are here
These kids are among the more than 1,200 students and their families who took the pledge to recycle right at the 10th Annual Earth Day Event celebration hosted by Waste Management at Monarch Hill Renewable Energy Park. SCS Engineers professionals contributed their support and know-how to celebrate and educate at the environmental event.
For the past decade, the event has offered students hands-on recycling, renewable energy and environmental-related activities. One of the most popular activities at the anniversary celebration was a wind machine in which students hilariously tried to catch swirling “hurricane debris.” The most recent storm, Hurricane Irma, added 660,000 tons of debris into the landfill in just four months. Experts explained other inner workings of the Renewable Energy Park such as how landfill gas becomes electricity and “clean” renewable energy.
The day’s activities included stations where students target what can’t be recycled in a bow and suction cup arrow game; don WM vests and hardhats beside the CNG truck which reduces greenhouse gas emissions, make a landfill out of candy before taking a bus tour of the real landfill and use recycled materials to make art with Young at Art and musical instruments with the South Florida Junior Chamber Ensemble.
Proving that being good to the environment is a winning strategy, Miami Dolphins’ former wide receiver O.J. McDuffie and former cornerback Patrick Surtain were on hand to sign autographs and take photos, many of which were shared on social media at #greenbroward, a local initiative in Broward County by Waste Management designed to engage and educate the community on sustainability efforts.
As part of the Earth Day festivities, Waste Management also awarded funds to all participating schools. The Dumpster Art Contest featured the handiwork of 14 schools that all took home gift cards to Michaels for future art projects.
In a letter dated December 18, 2018, Patricia Overmeyer, Deputy Director, Office of Brownfields and Land Revitalization at the USEPA encouraged the IRS to clarify the proposed opportunity zone regulations (REG-115420-18). She reminded the IRS that investments in the assessment, remediation, and redevelopment of brownfields properties in qualified opportunity zones (QOZ) are included within the scope of qualified opportunity funds (QOF).
Her goal is to give Opportunity Fund investors confidence that QOF investments can be used to assess, remediate, and redevelop brownfields properties located in QOZs. Subsequently, these clarifications may lead to the economic revitalization of many of our nation’s disadvantaged communities.
The public comment period for these regulations expired on December 28, 2018. The public hearing was held on February 14, 2019; participants requested additional guidance on a wide variety of proposed regulations, with many suggesting improvements to the regulations allowing for more flexibility in regards to business investment.
FULL TEXT
December 18, 2018
Kirsten B. Wielobob
Deputy Commissioner for Services and Enforcement
CC:PA:LPD:PR (REG-115420-18), Room 5203
Internal Revenue Service
PO Box 7604
Ben Franklin Station
Washington, DC 20044
Subject: U.S. EPA Office of Brownfields and Land Revitalization Seeks Regulatory Clarifications and Improvements to Proposed IRS Rule Regarding “Investing in Opportunity Funds,” REG-115420-18
Dear Ms. Wielobob:
On behalf of the U.S. Environmental Protection Agency’s (EPA) Office of Brownfields and Land Revitalization (OBLR), thank you for the opportunity to comment on the Department of Treasury’s Proposed Regulations §1400Z-2(a)-1, 2(c)-1, 2(d)-1, 2(e)-1 and Revenue Ruling 2018-29, regarding “Investing in Opportunity Funds.” EPA’s OBLR encourages the IRS to clarify and improve the proposed rule to better foster investment in blighted and contaminated properties, or “brownfield sites,” in designated Opportunity Zones.
The “Investing in Opportunity Act” has the potential to spur investment in communities where neighborhoods have long been plagued by concentrated distress and those left behind by the economic recovery following the Recession. Many of these communities struggle with stagnation and lack of access to capital, in part due to the challenges of remediating and redeveloping their brownfield sites. A brownfield is a property where the presence or potential presence of a hazardous substance, pollutant, or contaminant from the property’s former use complicates or inhibits the property’s expansion, redevelopment, or productive reuse. Brownfield sites often stigmatize neighborhoods and perpetuate blight and socio-economic distress.
EPA’s OBLR encourages the IRS to clarify in the final guidance that investments in the assessment, remediation, and redevelopment of brownfields properties located in Qualified Opportunity Zones (QOZs) are included within the scope of Qualified Opportunity Funds (QOFs). This clarification will provide an incentive to invest funds in the assessment, remediation, and reuse of brownfield properties. Assessing, remediating and redeveloping brownfield sites in QOZs is integral to the primary purpose of the Investing in Opportunity Act provisions1 because:
Clarification Requests and Comments:
EPA’s OBLR requests that the IRS make the following clarifications to the proposed guidelines. These clarifications will give Opportunity Fund investors confidence that QOF investment can be used to assess, clean up, and redevelop brownfields properties located in QOZs.
EPA’s OBLR requests that the IRS clarify the definition of “Original Use” so that the term applies to property that is a brownfield site as defined by section 101(39) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. 9601), which is the law that establishes the U.S. EPA brownfields program and guides brownfields considerations by many other federal departments and agencies. The IRS has used this definition of “brownfield” as well, under 26 U.S.C. Section 198(c), which permitted certain treatment of expenditures on “qualified environmental remediation” at a “qualified remediation site”, which was defined as “any area . . . at or on which there has been a release (or threat of release) or disposal of any hazardous substance.”
While most new investments assume that a property already meets applicable health and safety standards, brownfields properties are different in that they are complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant.
Defining “Original Use” to incorporate brownfields properties located in QOZs creates the best solution to enabling QOF investments in brownfields remediation and redevelopment. This clarification will address the concern that the 30-month window for substantial improvement is unrealistic for brownfields properties, which take longer than traditional vertical development projects due to the added challenges of contamination.
Example: A brownfields remediation firm purchases a contaminated brownfields property in a QOZ, where a former factory was once located, to remediate the land and sell the property for new use. This brownfield property should qualify as QOZ property under “original use.
“Underutilized” could be defined as it is in other federal statute, such as the definition of “underutilized” in 45 CFR 12a.1 (which defines underutilized as it relates to property owned by federal agencies), stating that ” underutilized” should mean an entire property or portion thereof, with or without improvements which is used only at irregular periods or intermittently by the owner or operator for purposes of that owner or operator, or which is used for current purposes that can be satisfied with only a portion of the property.
The definition of original use should also permit QOZ investment in properties that contribute to blight or create barriers to economic vibrancy due to prolonged vacancy or underutilization. Defining original use to include new use of properties that are contributing to decay within distressed communities is clearly in line with the purpose of the incentive
Example: A developer purchases a property to rehabilitate for new use. The property has a factory on it that has been vacant for more than one year. Regardless of whether that property is reused for a similar manufacturing purpose, a new manufacturing purpose, or a different kind of development (such as commercial or residential), this property should qualify as QOZ Property under “original use.” The same should apply for a property that has a 5-acre factory on it where only 0.5 acres of space are currently in use.
Local units of government often acquire brownfields and other blighted properties through tax delinquency, abandonment, bankruptcy, etc. A bright line test around the status of ownership for properties in foreclosure, receivership, or involuntary transfer may be easier to determine than the historical use of the property and expedite investment in assembled properties, particularly in distressed urban areas.
Without this clarification, it is unclear how improvements to the land itself factor into a calculation of substantial improvement, given that the adjusted basis in the example outlined in Rev. Rule 2018-29 pertains only to improvements to a building. While Rev. Rule 20 18-29 indicates that the cost of the land on which the building is located is not included in the adjusted basis for the substantial improvement calculation, it is unclear what the calculation would be on a brownfields project for which the primary or sole improvements are improvements to the land itself, when vertical development expected later.
Environmental assessment and remediation activities can make a property ready for redevelopment where it would otherwise be unsafe for reuse due to the presence or potential presence of environmental contamination. Unless the land is assessed, remediated to appropriate contaminant levels and exposures controlled (based on reuse of the property), any building and business investment will not occur on the property.
The following environmental assessment and remediation activities commonly occur at brownfield properties because they are necessary to enable safe reuse:
Example: A developer purchases Property X, which is located in a QOZ, for $1 million. Property X consists of a building previously used as a factory erected prior to 20 18 and land on which the factory building is located. Sixty percent ($600k) of the $1 million purchase price for Property X is attributable to the value of the land and forty percent ($400k) is attributable to the value of the building. QOF A intends to convert the factory building to residential rental property. The transformation will require $800k in environmental remediation costs. Within 29 months after the date of QOF A’s acquisition of Property X, QOF A invests $800k in remediating the property and $500k in additions to the building. Clarification is necessary to ensure that the expenses associated with remediating the land will count toward the substantial improvement calculation. The same is true for a similar scenario common at complex brownfield sites in which at the close of the 30-month period the only expenditures have been for remediation of the land.
Clarification on this issue is particularly pertinent to facilitating the ability for QOZ Businesses to remediate brownfields properties with QOF funds to sell to a vertical developer and still access the benefits of the step-up in basis. Without this clarification, using QOF funding for brownfields remediation and property improvement as the primary business activity might require the owners of the site to sit on the site for the duration of the ten years after remediation is complete in order to access the benefits of the Opportunity Zone incentive.
Example: On January 1, 2019, T, a calendar-year taxpayer, invested $1 million of gain in B, an QOF partnership dedicated to brownfields cleanup that remediates properties to sell for future vertical development by other parties. B immediately makes a $1 million investment in remediation and land improvements to a brownfields site that qualifies as QOZ Property. On January 1, 2023 (after four years), B sells the remediated QOZ Property to a vertical developer for $1.5 million and reinvests all of the proceeds in replacement QOZ Property within 12 months. Clarification is necessary that if the entire $1.5 million from the sale of QOZ Property is reinvested into replacement QOZ Property: 1) the deferral and reduction in basis timeclocks on the original $1 million investment would not reset, and 2) the 10-year timeclock on would not reset for the $500,000 in gain.
Brownfields remediation and redevelopment often includes separate land improvement (horizontal development) and vertical development phases, and investors face regulatory risk of effectuating cleanup which enables the property to be financed. These factors make the substantial improvement 30-month window extremely difficult time frame in which to complete a redevelopment which involves remediation of environmental contamination.
Large redevelopment projects such as auto manufacturing site or former hospitals may require extensive demolition of existing buildings, excavation, cleanup and grading as early site preparations for the construction of the new structure. It is common to spend several years on existing structural demolition, earthmoving, and environmental cleanup on large sites, which almost guarantees that the finished building will not be completely operational by the end of the 30-month period for substantial improvement. Many “ground up” construction projects in cold weather climates will also face greater challenges in achieving occupancy within 30 months and will likely be a work in progress. Clarity is needed so that significant — and transformative — redevelopment projects can be pursued.
Thank you for considering our requests for clarifications. The clarifications we are requesting will give Opportunity Fund investors confidence that QOF investments can be used to assess, remediate, and redevelop brownfields properties located in QOZs. Subsequently, these clarifications may lead to the economic revitalization of many of our nation’s disadvantaged communities. Should you want to discuss our comments and requests for clarification, please feel free to contact me at 202-566-2774 or .
Sincerely,
Patricia Overmeyer
Deputy Director
Office of Brownfields and Land Revitalization
U.S. Environmental Protection Agency
1See H.R. Rept. 115-466, 537, which describes the intent to attract an influx of capital to designated low-income communities with impacts and outcomes in those areas including job creation, poverty reduction, and other metrics.
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Jeffrey Reed, P.E. is now leading SCS Engineers business operations in Texas, including all environmental consulting, landfill, landfill gas, and solid waste business. He commences his responsibilities immediately, under the title Business Unit Director, and is managing the staff and business operations of four offices. His primary office is located in Houston, Texas.
Jeff, a Professional Engineer, licensed in Alabama, Florida, Louisiana, Minnesota, Mississippi, New Mexico, North Carolina, Oklahoma, South Carolina, and Texas has a broad range of environmental expertise. He has provided design and consulting services for projects in 26 states across the U.S., Canada, and Mexico.
Jeff is a Vice President of SCS Engineers and a National Expert on Landfill Design and Construction Quality Assurance for the firm. He has over 30 years of experience working in the solid waste industry. His project experience includes stormwater management, liquids management and leachate control, erosion control, hydrogeological/hydraulic analysis, landfill design and permitting, geosynthetic lining and cover systems, stability analysis, and construction quality assurance. He is a member of the American Society of Civil Engineers and the Solid Waste Association of North America.
Kevin Yard, PE, BCEE, SCS’s former Texas Business Unit Director, will continue to support key projects in Texas while he manages clients nationwide that are investing in new infrastructure and processes compatible with their firms’ environmental climate goals.
“Over his ten+ years with SCS, Jeff has demonstrated his leadership and capabilities resolving complex environmental challenges,” said Kevin Yard. “Jeff provides the standard of quality and services to our clients who rely on SCS to support their business operations while meeting rapidly-changing air, water, and soil compliance standards.”
A Facility’s Perspective into a Modeled PSD Increment Violation
Midwest Environmental Compliance Conference – MECC 2019
In 2005, dispersion modeling was conducted in Nebraska Bluff Road Landfill as part of the construction permitting process for the Lincoln Electric System Salt Valley Generating Station. The modeling results identified a Prevention of Significant Deterioration (PSD) increment violation at the Bluff Road Landfill resulting from activities associated with landfill operations. The model results predicted an increment violation for particulate matter less than 10 microns (PM10) at the landfill boundary, specifically for the short term 24-hour standard for PM10.
This SCS Engineers’ presentation by Tia Jeter, focuses on the experience of Bluff Road Landfill and the City of Lincoln, as the entities responded to the modeled violation, and provides highlights of the process required to ultimately resolve the increment violation and bring the facility into modeled compliance with the increment.
Resolving the modeled increment violation required coordination with multiple entities, including the local air permitting authority, the Lincoln Lancaster County Health Department (LLCHD), the Nebraska Department of Environmental Quality (NDEQ) and US EPA Region 7. To resolve the violation, facility emission processes, operational limitations, emission controls, model setup, and the compliance boundary was evaluated and revised numerous times. Initial modeling efforts conducted as part of the response utilized the Industrial Source Complex 3 Short Term (ISC3ST) model, which was the EPA-approved dispersion model at the outset of the project. Due to the prolonged timeline of the project, the final compliance modeling scenario submitted to the regulatory agency was completed using AERMOD which is now the EPA-approved dispersion model.
Along the path to compliance there were multiple challenges, including negotiations on emission point modeling methods, clarification on the definition of ambient air as it relates to leased property, the requirement to create federally enforceable compliance requirements, the slow response and feedback from the regulatory authority (ies), and the bureaucratic “hold-up” of other facility projects until resolution of the violation was attained.
Tia’s presentation will provide an overview of the road to compliance for the Bluff Road Landfill from the beginning of the project to the resolution of the increment violation. Her presentation provides an insight into what other facilities may experience in the future as compliance with the National Ambient Air Quality Standards and PSD increment for PM10 and particulate matter less than 2.5 microns (PM2.5) becomes increasingly more scrutinized. Learn more about Tia Jeter.
