On Friday, the Clean Ohio Council met to discuss proposed changes to the Clean Ohio program. As discussed previously on this blog, the Kasich Administration has repeatedly discussed completely revamping brownfield funding in Ohio. The Administration previously announced its intention to shift the program's administration to JobsOhio along with the liquor profits that were used to payoff the bonds that created Clean Ohio. The Administration also has indicated it wants to shift from a grant based program to loans.
JobsOhio is currently caught up in a legal challenge to the constitutionality of the semi-public organization. As a result of the legal challenge, the Administration has not provided any details as to what brownfield funding will look like under JobsOhio.
Back in May, it was announced that $15 million in new funding would be allocated to the Clean Ohio program as a stop gap measure until the dust settled on the JobsOhio litigation. Clean Ohio funding has previously been at $37.5 million per year. Many believed that the $15 million would be allocated using the similar Clean Ohio process and procedures that have operated for nearly a decade.
On Friday, staff from the newly created Development Services Agency presented revised policies for new procedures to be utilized in awarding the $15 million in new funding. The proposal presented represents a seismic shift in how funding decisions will be made.
Here is a quick synopsis of the major changes:
- Major Reduction in Funding Available Per Project- The maximum available in funding for assessment grants was reduced from $300,000 down to $200,000. The maximum available in clean up funding was reduced from $3 million to $1 million;
- Overhaul to the Grant Selection Process- Previously, there were two grant rounds per year. Grant applications received during a round competed against one another for funding. The Clean Ohio Council utilized a scoring process to evaluate each grant application. The scoring criteria was a mix of points based upon the proposed development, amount of clean up occurring and importance to the local community. The new proposal would do away with grant rounds and the scoring process entirely. Under the new system, the Director of Development Services would make awards on a rolling basis utilizing Agency discretion.
- Premium on Job Creation- While the application process is still somewhat murky because the forms have not been released, it appears from documents released Friday that the intention is to evaluate applications based on jobs almost exclusively. The old scoring system provided placed higher value on clean up of highly contaminated sites as well as their importance to the local community.
- More Funding for Infrastructure- The new proposal increases the percentage of the grant that can be spent on infrastructure versus environmental clean up from a maximum of 10% up to 25%.
- Loans- While the policy changes incorporate the concept of loans, as it stands the new policy would retain the limitation that no more than 15% of funding shall be used for loans. (See, Section 6.02). Therefore, the Administration, at least for now, wants to see the vast majority of funding in the form of grants versus loans
Concerns were expressed during the Clean Ohio Council meeting on Friday that there had not been any opportunity for the public to comment on the major restructuring of the program. In response, it was decided to allow a thirty day (30) public comment period on the policy changes.
Click here to access the proposed changes to the Clean Ohio Fund Policies. Instructions for submitting comments are also available on the web page.
Implications of the Policy Changes
It is pretty easy to acknowledge the Clean Ohio as we know will no longer exist if the proposed changes are adopted following the public comment period. The old program had two grant processes:
a) Clean Ohio Assistance Fund (COAF)- Allowed for up to $300,000 for assessment and $700,000 for clean up. COAF applications could be submitted on a rolling basis and decisions were made exclusively by the Director of Development.
b) Clean Ohio Revitalization Fund (CORF)- Allowed for up to $3 million in clean up funding. There were typically two rounds per year. Applications were submitted and competed against one another in each round. The project applications were scored using a mix of points for development, environmental clean up and importance to the local community.
The proposal presented Friday essentially does away with CORF and moves exclusively to a COAF like approach. The advantage of the new approach is the speed as to which funding decisions will be made. However, the disadvantages to this approach are as follows:
- $1 Million Dollar Cap on Clean Up Grant Funding will mean Only Smaller Clean Up Projects will Get Funded- The vast majority of the larger development projects involved $2 to $3 million in funding under the old CORF program. By capping the available cap at $1 million, the larger brownfield redevelopment projects are far less likely to occur. What could happen is that the only projects getting funded in future will be for asbestos abatement & demolition. There simply won't be enough funds to deal with sites that have significant soil or groundwater contamination.
- No Competition Makes it More Difficult to Ensure the Limited Funds Go to the Best Projects- Because all grant awards will be made on a rolling basis it will be much more difficult to compare and contrast projects. No objective scoring criteria will be implemented and the public involvement in selecting projects will be greatly reduced.